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EXHIBIT 10.3
 
  GENERAL ELECTRIC CAPITAL CORPORATION
  [WINSTON SPECIAL PURPOSE ENTITY]
 
 FORM OF LOAN AGREEMENT
 
  
 DOCUMENT PREPARED BY:




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TABLE OF CONTENTS
 PageARTICLE 1 CERTAIN DEFINITIONS
    
    
    1Section 1.1
    
    Certain Definitions
    
    
    1ARTICLE 2 LOAN TERMS
    
    
    7Section 2.1
    
    The Loan
    
    
    7Section 2.2
    
    Interest Rate; Late Charge
    
    
    7Section 2.3
    
    Terms of Payment
    
    
    7Section 2.4
    
    Security; Establishment of Funds
    
    
    8ARTICLE 3 INSURANCE, CONDEMNATION, AND IMPOUNDS
    
    
    11Section 3.1
    
    Insurance
    
    
    11Section 3.2
    
    Use and Application of Insurance Proceeds
    
    
    13Section 3.3
    
    Condemnation Awards
    
    
    14Section 3.4
    
    Impounds
    
    
    15ARTICLE 4 ENVIRONMENTAL MATTERS
    
    
    16Section 4.1
    
    Certain Definitions
    
    
    16Section 4.2
    
    Representations and Warranties on Environmental Matters
    
    
    16Section 4.3
    
    Covenants on Environmental Matters
    
    
    17Section 4.4
    
    Allocation of Risks and Indemnity
    
    
    17Section 4.5
    
    No Waiver
    
    
    18ARTICLE 5 LEASING MATTERS
    
    
    19Section 5.1
    
    Representations and Warranties on Leases
    
    
    19Section 5.2
    
    Standard Lease Form; Approval Rights
    
    
    19Section 5.3
    
    Covenants
    
    
    19Section 5.4
    
    Tenant Estoppels
    
    
    20ARTICLE 6 REPRESENTATIONS AND WARRANTIES
    
    
    20Section 6.1
    
    Organization, Power and Authority
    
    
    20Section 6.2
    
    Validity of Loan Documents
    
    
    20Section 6.3
    
    Liabilities; Litigation
    
    
    21Section 6.4
    
    Taxes and Assessments
    
    
    21Section 6.5
    
    Other Agreements; Defaults
    
    
    21Section 6.6
    
    Compliance with Law
    
    
    21Section 6.7
    
    Location of Borrower
    
    
    22
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PageSection 6.8
    
    ERISA
    
    
    22Section 6.9
    
    Forfeiture
    
    
    22Section 6.10
    
    Tax Filings
    
    
    22Section 6.11
    
    Solvency
    
    
    23Section 6.12
    
    Full and Accurate Disclosure
    
    
    23Section 6.13
    
    Flood Zone
    
    
    23Section 6.14
    
    Single Purpose Entity/Separateness
    
    
    23Section 6.15
    
    Anti-Terrorism and Anti-Money Laundering Laws
    
    
    25ARTICLE 7 FINANCIAL REPORTING
    
    
    27Section 7.1
    
    Financial Statements
    
    
    27Section 7.2
    
    Accounting Principles
    
    
    28Section 7.3
    
    Other Information; Access
    
    
    28Section 7.4
    
    Annual Budget
    
    
    28ARTICLE 8 COVENANTS
    
    
    28Section 8.1
    
    Due On Sale and Encumbrance; Transfers of Interests
    
    
    28Section 8.2
    
    Taxes; Utility Charges
    
    
    29Section 8.3
    
    Control; Management
    
    
    29Section 8.4
    
    Operation; Maintenance; Inspection
    
    
    29Section 8.5
    
    Taxes on Security
    
    
    29Section 8.6
    
    Legal Existence; Name, Etc
    
    
    30Section 8.7
    
    Further Assurances
    
    
    30Section 8.8
    
    Estoppel Certificates
    
    
    30Section 8.9
    
    Notice of Certain Events
    
    
    30Section 8.10
    
    Indemnification
    
    
    31Section 8.11
    
    Cooperation
    
    
    32Section 8.12
    
    Payment For Labor and Materials
    
    
    33Section 8.13
    
    Certain Hotel Covenants
    
    
    33ARTICLE 9 EVENTS OF DEFAULT
    
    
    37Section 9.1
    
    Payments
    
    
    37Section 9.2
    
    Insurance
    
    
    37Section 9.3
    
    Sale, Encumbrance, Etc
    
    
    37Section 9.4
    
    Covenants
    
    
    37Section 9.5
    
    Representations and Warranties
    
    
    37Section 9.6
    
    Other Encumbrances
    
    
    38Section 9.7
    
    Involuntary Bankruptcy or Other Proceeding
    
    
    38Section 9.8
    
    Voluntary Petitions, etc
    
    
    38Section 9.9
    
    Anti-Terrorism
    
    
    38Section 9.10
    
    Franchise and Management Agreements
    
    
    38Section 9.11
    
    Operating Lease
    
    
    39
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PageARTICLE 10 REMEDIES
    
    
    39Section 10.1
    
    Remedies  Insolvency Events
    
    
    39Section 10.2
    
    Remedies  Other Events
    
    
    39Section 10.3
    
    Lenders Right to Perform the Obligations
    
    
    39ARTICLE 11 MISCELLANEOUS
    
    
    40Section 11.1
    
    Notices
    
    
    40Section 11.2
    
    Amendments and Waivers
    
    
    41Section 11.3
    
    Limitation on Interest
    
    
    41Section 11.4
    
    Invalid Provisions
    
    
    42Section 11.5
    
    Reimbursement of Expenses
    
    
    42Section 11.6
    
    Approvals; Third Parties; Conditions
    
    
    42Section 11.7
    
    Lender Not in Control; No Partnership
    
    
    43Section 11.8
    
    Contest of Certain Claims
    
    
    43Section 11.9
    
    Time of the Essence
    
    
    44Section 11.10
    
    Successors and Assigns
    
    
    44Section 11.11
    
    Renewal, Extension or Rearrangement
    
    
    44Section 11.12
    
    Waivers
    
    
    44Section 11.13
    
    Cumulative Rights; Joint and Several Liability
    
    
    44Section 11.14
    
    Singular and Plural
    
    
    44Section 11.15
    
    Phrases
    
    
    44Section 11.16
    
    Exhibits and Schedules
    
    
    44Section 11.17
    
    Titles of Articles, Sections and Subsections
    
    
    45Section 11.18
    
    Promotional Material
    
    
    45Section 11.19
    
    Survival
    
    
    45Section 11.20
    
    WAIVER OF JURY TRIAL
    
    
    45Section 11.21
    
    Waiver of Punitive or Consequential Damages
    
    
    46Section 11.22
    
    Governing Law; Jurisdiction
    
    
    46Section 11.23
    
    Entire Agreement
    
    
    47Section 11.24
    
    Counterparts
    
    
    47ARTICLE 12 LIMITATIONS ON LIABILITY
    
    
    47Section 12.1
    
    Limitation on Liability
    
    
    47Section 12.2
    
    Limitation on Liability of Lenders Officers, Employees, etc
    
    
    49
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LIST OF EXHIBITS AND SCHEDULES
 EXHIBIT A
    
    LEGAL DESCRIPTION OF PROJECTSCHEDULE I
    
    DEFEASANCESCHEDULE II
    
    REQUIRED REPAIRSSCHEDULE III
    
    REPLACEMENT MANAGERSSCHEDULE IV
    
    RADIUS HOTELS
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LOAN AGREEMENT
 Agreement GENERAL ELECTRIC CAPITAL CORPORATION Lender [WINSTON
SPECIAL PURPOSE ENTITY]  Borrower
 ARTICLE 1
CERTAIN DEFINITIONS
 Section 1.1 Certain Definitions
 Affiliate
 Agreement
 Assignment of Leases and Rents
 Award
 Bankruptcy Party
 Borrower Party
 Budget
 Business Day
 Page 1




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Casualty
 Closing Date
 Code
 Condemnation
 Contract Rate
 Debt
 Debt Service
 Debt Service Coverage
 Default Rate
 Defeasance Option
 Environmental Indemnity Agreement
 Environmental Laws
 ERISA
 Event of Default
 Page 2




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FF&E
 FF&E Account
 FF&E Account Conditions
 Funds
 GAAP
 Hazardous Materials
 Impound Trigger Event
 Insurance Premiums
 Interest Only Period
 Joinder Party
 Lease Subordination Agreement
 Lien
 Loan
 Loan Documents
 Page 3




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Loan Year
 Management Agreement
 Management Subordination Agreement
 Manager
 Maturity Date
 Mortgage
 Net Cash Flow
 Note
 Operating Expenses
 Page 4




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Operating Lease
 Operating Lessee
 Operating Revenues
 Payment Date
 Person
 Potential Default
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Project    Exhibit A
 Rating Agencies
 Secondary Market Transaction
 Securitization
 Securitization Date
 Single Purpose Entity
 Site Assessment
 Standard Adjustments
 State
 Tax and Insurance Escrow Fund
 Taxes
 Underwritten NOI
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Underwritten Operating Expenses
 Underwritten Operating Revenues
 Uniform System of Accounts Uniform System of Accounts for the
Lodging Industry
 Yield Maintenance Amount Schedule I
 ARTICLE 2
LOAN TERMS
 Section 2.1 The Loan
 Section 2.2 Interest Rate; Late Charge Contract Rate
 Section 2.3 Terms of Payment
 (a) Interest and Principal
 (i)
    
    A payment of interest only on the date hereof for the period
from the date hereof through the last day of the current month.(ii)
    
    Commencing on July 1, 2006, and continuing on the first
(1st) day of each calendar month thereafter (each such date a
Payment Date) during the
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Interest Only Period, Borrower shall pay
interest only in arrears computed at the Contract Rate on the outstanding
principal balance of the Loan.(iii)
    
    Thereafter, commencing on the forty-ninth (49th)
Payment Date, and continuing on each Payment Date thereafter until the Maturity
Date, Borrower shall make a constant payment of $. Each of such
payments shall be applied (i) to the payment of interest computed at the
Contract Rate and (ii) the balance applied toward reduction of the principal
sum. The constant payment required hereunder is based on a thirty (30)-year
amortization schedule.
 (b) Maturity
 (c) Prepayment
  (d) Defeasance Schedule I Defeasance Option
 Section 2.4 Security; Establishment of Funds .
  Page 8




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(i)
    
    Although no escrow is required therefor, Borrower shall
complete the required repairs set forth on Schedule II annexed hereto
on or before six (6) months from the date hereof;(ii)
    
    subject to the last sentence of this Section 2.4(a)(ii), to the
extent not already required under the Franchise Agreement (as hereinafter
defined), (x) Borrower will be required to deposit into an escrow with Lender
(the FF&E Account) four percent (4%) of the monthly Operating
Revenues of the Project each month for the repair and replacement of the
furniture, fixtures and equipment used in connection with the operation, use
and occupancy of the Project (the FF&E), and (y) on the date hereof
Borrower shall deposit in the FF&E Account the amount of any existing funds
maintained by or for the benefit of Borrower for the repair and replacement of
the FF&E, unless such funds are required to be deposited with the franchisor.
Notwithstanding the foregoing, no deposits shall be required in the FF&E
Account so long as (A) Borrower is, directly or indirectly, controlled by
Winston Hotels, Inc., (B) no monetary or other material Event of Default
exists, and (C) Borrower provides evidence satisfactory to Lender on or before
July 15 of each calendar year commencing July 15, 2007, that over the preceding
sixty (60) month period an amount equal to four percent (4%) of Operating
Revenues, or such greater amounts as required by the Franchise Agreement, for
such period has been spent on capital improvements, replacements, and FF&E for
the Project (the FF&E Account Conditions); and(iii)
    
    Borrower shall deliver to Lender reservation payments made for
guest, meeting, banquet or other rooms made more than six (6) months in advance
and exceeding $150,000 in the aggregate which shall be disbursed to Borrower
upon receipt of notice to Lender of the occurrence of the applicable event to
which such deposit is related or the required return or forfeiture of the
deposit.
 (b) Pledge and Disbursement of Funds
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(i)
    
    following the occurrence of any FF&E Account Condition, if such
repair and repair and replacement are not in accordance with the Budget, Lender
has approved the repairs and replacements and related plans and specifications,
which approval shall be deemed approved if not disapproved within thirty (30)
days after receipt of documents reasonably required in connection with such
review;(ii)
    
    Lender determines that the repairs and replacements of the FF&E
are capital expenditures rather than normal repair and maintenance expenses;(iii)
    
    the requested disbursement is made not more frequently than
once monthly and in increments of not less than Five Thousand Dollars
($5,000.00);(iv)
    
    the work for which the disbursement is requested does not
include any immediate repairs required under Section 2.4(a) above;(v)
    
    Borrower has fulfilled all conditions precedent under the
Franchise Agreement (if applicable) for the work related to the requested
disbursement; and(vi)
    
    there exist no monetary or other material Event of Default
under the Loan Documents.
 (d) Interest Payable by Lender
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Depository Institution Borrowers
Interest
 ARTICLE 3
INSURANCE, CONDEMNATION, AND IMPOUNDS
 Section 3.1 Insurance
 (a) Casualty; Business Interruption
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(b) Liability
 (c) Additional Insurance
 (i)
    
    Dram Shop and/or Innkeepers Liability insurance in an
amount not less than the greater of One Million Dollars ($1,000,000.00) or as
required by applicable law, against claims or liabilities arising directly or
indirectly to Persons or property on account of the sale or dispensing of beer,
wine or other alcoholic beverage, including in such coverage loss of means of
support; and(ii)
    
    employee dishonesty, and money and securities insurance (inside
and out), depositors forgery, and liability for guests property on a blanket
basis covering all employees of Borrower or Manager who have access to or are
responsible for the handling of Borrowers funds, guest property or tenant
security deposits, in such amounts as Lender shall require from time to time,
but in no event less than One Million Dollars ($1,000,000.00); and(iii)
    
    Builders risk insurance, as applicable, in amounts and with
coverages reasonably required by Lender.
 (d) Form and Quality
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Insurance Premiums
 (e) Adjustments
 Section 3.2 Use and Application of Insurance Proceeds.
 Casualty
  (i)
    
    if the loss is less than or equal to Three Hundred Fifty
Thousand Dollars ($350,000.00), Lender shall permit Borrower to apply the
insurance proceeds to restoration provided (A) no Event of Default or
Potential Default exists that would not be cured by the application of the
insurance proceeds to and the restoration of the Project, and (B) Borrower
promptly commences and is diligently pursuing restoration of the Project;(ii)
    
    if the loss exceeds Three Hundred Fifty Thousand Dollars
($350,000.00) but is not more than twenty-five percent (25%) of the replacement
value of the improvements, the insurance proceeds shall be deposited with a
financial institution or third-party insurance intermediary reasonable
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acceptable to Borrower and Lender for application, prior to the occurrence of
an Event of Default, to restoration provided that (A) at all times during such
restoration no Event of Default or Potential Default exists that would not be
cured by the application of the insurance proceeds to and the restoration of
the Project; (B) Lender determines throughout the restoration that there are
sufficient funds available to restore and repair the Project to a condition and
value, substantially as prior to the casualty; (C) Lender determines that the
Operating Revenues of the Project during restoration, taking into account rent
loss or business interruption insurance, will be sufficient to pay Debt
Service; (D) Lender reasonably determines (based on leases which will remain in
effect after restoration is complete if the Project is not a multi-family
project) that after restoration the ratio of net operating income to Debt
Service will equal at least the ratio that existed on the Closing Date; (E)
Lender reasonably determines that the ratio of the outstanding principal
balance of the Loan to appraised value of the project after restoration will
not exceed the loan-to-value ratio that existed on the date of the casualty;
(F) Lender reasonably determines that restoration and repair of the Project to
a condition approved by Lender will be completed within nine (9) months after
the date of loss or casualty and in any event ninety (90) days prior to the
Maturity Date; (G) Borrower promptly commences and is diligently pursuing
restoration of the Project; and (H) the Project after the restoration will be
in compliance with and permitted under all applicable zoning, building and land
use laws, rules, regulations and ordinances; and(iii)
    
    if the conditions set forth in (i) and (ii) above are not
satisfied in Lenders reasonable discretion, Lender may apply any insurance
proceeds it may receive to the payment of the Loan or allow all or a portion of
such proceeds to be used for the restoration of the Project.
  Section 3.3 Condemnation Awards Condemnation Award
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Section 3.4 Impounds. th Tax and Insurance Escrow Fund
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ARTICLE 4
ENVIRONMENTAL MATTERS
 Section 4.1 Certain Definitions.
 Environmental Laws
 Hazardous Materials
 Section 4.2 Representations and Warranties on Environmental Matters.
 Page 16




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Section 4.3 Covenants on Environmental Matters.
    Section 4.4 Allocation of Risks and Indemnity.
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Section 4.5 No Waiver.
 Page 18




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ARTICLE 5
LEASING MATTERS
 Section 5.1 Representations and Warranties on Leases.
 Section 5.2 Standard Lease Form; Approval Rights. Material Leases
 Section 5.3 Covenants.
 Page 19




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Section 5.4 Tenant Estoppels.
 ARTICLE 6
REPRESENTATIONS AND WARRANTIES
  Section 6.1 Organization, Power and Authority.
 Section 6.2 Validity of Loan Documents.
 Page 20




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Section 6.3 Liabilities; Litigation.
   Section 6.4
Taxes and Assessments.
 Section 6.5 Other Agreements; Defaults.
 Section 6.6 Compliance with Law.
  Page 21




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Section 6.7 Location of Borrower.
 Section 6.8 ERISA.
 ERISA
  Section 6.9 Forfeiture.
 Section 6.10 Tax Filings.
 Page 22




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Section 6.11 Solvency.
 Section 6.12 Full and Accurate Disclosure.
 Section 6.13 Flood Zone.
 Section 6.14 Single Purpose Entity/Separateness.
  Page 23




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Page 24




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Section 6.15 Anti-Terrorism and Anti-Money Laundering Laws
   (i)
    
    is listed on the Lists (as defined below);
 Page 25




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(ii)
    
    is a Person who has been determined by competent authority to
be subject to the prohibitions contained in the Anti-Money Laundering Laws;(iii)
    
    is owned or controlled by, nor acts for or on behalf of, any
Person on the Lists or any other Person who has been determined by competent
authority to be subject to the prohibitions contained in the Anti-Money
Laundering Laws;(iv)
    
    shall transfer or permit the transfer of any interest in
Borrower or any Borrower Party to any Person who is or whose beneficial owners
are listed on the Lists; or(v)
    
    shall knowingly lease space in the Project to any Person who is
listed on the Lists or who is engaged in illegal activities.
       Anti-Money Laundering Laws
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et seq ., et seq et seq
 Lists
 OFAC
 Tenant
 knowledge
 ARTICLE 7
FINANCIAL REPORTING
 Section 7.1 Financial Statements
 (a) Monthly Reports
 (b) Quarterly Reports
 (c) Annual Reports
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(d) Certification; Supporting Documentation
 Section 7.2 Accounting Principles.
 Section 7.3 Other Information; Access.
 Section 7.4 Annual Budget. Budget
 ARTICLE 8
COVENANTS
  Section 8.1 Due On Sale and Encumbrance; Transfers of Interests.
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Section 8.2 Taxes; Utility Charges. Taxes
 Section 8.3 Control; Management.
 Section 8.4 Operation; Maintenance; Inspection.
 Section 8.5 Taxes on Security.
 Page 29




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Section 8.6 Legal Existence; Name, Etc.
 Section 8.7 Further Assurances.
 Section 8.8 Estoppel Certificates.
 Section 8.9 Notice of Certain Events.
 Page 30




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Section 8.10 Indemnification.
   Claim
 Page 31




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Section 8.11 Cooperation. Secondary Market Transactions, Securitization Securities
 Page 32




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Section 8.12 Payment For Labor and Materials.
 Section 8.13 Certain Hotel Covenants.
 Franchise
Agreement
  Page 33




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Schedule III Schedule III
    (i)
    
    promptly perform and/or observe all of the covenants and
agreements required to be performed and observed by it under the Franchise
Agreement and the Management Agreement and do all things necessary to preserve
and to keep unimpaired its material rights thereunder;(ii)
    
    promptly notify Lender of any material default under the
Franchise Agreement or the Management Agreement of which it is aware;(iii)
    
    promptly deliver to Lender a copy of each financial statement,
business plan, capital expenditures plan, or material notice, report and
estimate received by it under the Franchise Agreement or the Management
Agreement;(iv)
    
    promptly enforce the performance and observance of all of the
material covenants and agreements required to be performed and/or observed by
 Page 34




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the franchisor under the Franchise Agreement and the Manager under the
Management Agreement; and(v)
    
    ensure that each Manager shall hold and maintain all necessary
licenses, certifications and permits required by law.(vi)
    
    require Manager, or any successor manager, to execute an
agreement with Lender, in form and substance satisfactory to Lender, which
shall provide, among other things, that the Manager, or any successor manager:
 (1)
    
    agrees to give Lender a simultaneous copy of
any notice of default sent to Borrower;(2)
    
    grants Lender the right, but not the
obligation, to cure monetary defaults of Borrower under the Management
Agreement within thirty (30) days and cure non-monetary defaults of
Borrower within sixty (60) days;(3)
    
    allows Lender to foreclose its lien and will,
thereafter, upon request, reinstate the Management Agreement, without
charge, if such is suspended prior to or during the foreclosure
proceedings, provided all defaults have been cured; and(4)
    
    agrees that if Lender, any affiliate of Lender,
or any nominee of Lender or other transferee acquires ownership of the
property, such party may terminate the Management Agreement without
payment or liability to the Manager upon thirty (30) days notice to the
Manager; and
 (vii)
    
    Perform all of the work set forth in the Property Improvement
Plan (PIP), if any, set forth in the Franchise Agreement in
accordance with the following:
 (1)
    
    Borrower shall complete the PIP at its sole
cost and expense in accordance with the budget therefor reasonably
approved by Lender within the time periods set forth the PIP in a
lien-free and good and workmanlike manner, and such work shall be
performed in compliance with all applicable local, State and federal
laws, and in compliance with franchisors fire protection and life
safety standards set forth in the PIP, even if such standards exceed
the requirements of applicable local, State and federal laws;(2)
    
    Borrower shall deliver to franchisor all plans,
specifications, permits, certificates, professional opinions and other
related requirements within the time periods set forth in the PIP;
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(3)
    
    Borrower shall deliver to Lender a copy of
franchisors final inspection report for the PIP and franchisors
written approval acknowledging Borrowers completion of all of the
requirements set forth in the PIP to franchisors complete
satisfaction; and(4)
    
    Borrower shall deliver to Lender the written
certification that all of the work set forth in the PIP meet all of
franchisors requirements and evidence of completion to franchisors
full satisfaction.
     (i)
    
    surrender, terminate or cancel the Franchise Agreement or the
Management Agreement;(ii)
    
    reduce or consent to the reduction of the term of the Franchise
Agreement or the Management Agreement;(iii)
    
    increase or consent to the increase of the amount of any
charges under the Franchise Agreement or the Management Agreement; or(iv)
    
    otherwise modify, change, supplement, alter or amend, or waive
or release any of its rights and remedies under, the Franchise Agreement or the
Management Agreement in any material respect; provided that the Franchise
Agreement and Management Agreement may be extended or renewed so long as no
default has occurred and is continuing thereunder and no Event of Default has
occurred and is continuing hereunder.
 Schedule IV
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ARTICLE 9
EVENTS OF DEFAULT
  Section 9.1 Payments.
 Section 9.2 Insurance.
 Section 9.3 Sale, Encumbrance, Etc.
 Section 9.4 Covenants.
 Section 9.5 Representations and Warranties.
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Section 9.6 Other Encumbrances.
 Section 9.7 Involuntary Bankruptcy or Other Proceeding Bankruptcy Party
 Section 9.8 Voluntary Petitions, etc
 Section 9.9 Anti-Terrorism
 Section 9.10 Franchise and Management Agreements
 Schedule III
  Page 38




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Section 9.11
Operating Lease
  ARTICLE 10
REMEDIES
 Section 10.1 Remedies  Insolvency Events.
 Section 10.2 Remedies  Other Events.
 Section 10.3 Lenders Right to Perform the Obligations.
 Page 39




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ARTICLE 11
MISCELLANEOUS
 Section 11.1 Notices.
 If to Borrower:
    
    [Winston Special Purpose Entity]c/o Winston Hotels, Inc.2626 Glenwood AvenueRaleigh, North Carolina 27608Attention: Joe GreenTelecopy: (919) 510-5251If to Lender:
    
    General Electric Capital Corporationc/o GEMSA Loan Services, L.P.1500 City West Blvd., Suite 200Houston, Texas 77042-2300Attention: Portfolio Manager/Access ProgramTelecopy: (713) 458-7500
 Page 40




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with a copy to:
    
    General Electric Capital Corporation16479 Dallas Parkway, Suite 500Two Bent Tree TowerAddison, Texas 75001-2512Attention: David R. MartindaleTelecopy: (972) 728-7650
  Section 11.2 Amendments and Waivers.
 Section 11.3 Limitation on Interest.
 Page 41




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Section 11.4 Invalid Provisions.
 Section 11.5 Reimbursement of Expenses.
 Section 11.6 Approvals; Third Parties; Conditions.
 Page 42




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Section 11.7 Lender Not in Control; No Partnership.
 Section 11.8 Contest of Certain Claims.
 Page 43




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Section 11.9 Time of the Essence.
 Section 11.10 Successors and Assigns.
 Section 11.11 Renewal, Extension or Rearrangement.
 Section 11.12 Waivers.
 Section 11.13 Cumulative Rights; Joint and Several Liability.
 Section 11.14 Singular and Plural.
 Section 11.15 Phrases.
 Section 11.16 Exhibits and Schedules.
 Page 44




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Section 11.17 Titles of Articles, Sections and Subsections.
 Section 11.18 Promotional Material.
 Section 11.19 Survival.
 Section 11.20 WAIVER OF JURY TRIAL.
 Page 45




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Section 11.21 Waiver of Punitive or Consequential Damages.
 Section 11.22 Governing Law; Jurisdiction.
   Page 46




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Section 11.23 Entire Agreement.
 Section 11.24 Counterparts.
 ARTICLE 12
LIMITATIONS ON LIABILITY
 Section 12.1 Limitation on Liability.
    Page 47




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Page 48




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Section 12.2 Limitation on Liability of Lenders Officers, Employees, etc.
 Page 49




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LENDER:
    
    GENERAL ELECTRIC CAPITAL CORPORATION,a Delaware corporationBy:
    
    /s/ David R. MartindaleDavid R. Martindale, Managing DirectorBORROWER:
    
    [WINSTON SPECIAL PURPOSE ENTITY],a Delaware limited liability companyBy:
    
    WINN LIMITED PARTNERSHIP,a North Carolina limited partnership,its Sole MemberBy:
    
    WINSTON HOTELS, INC.,a North Carolina corporation,its General PartnerBy:
    
    /s/ Jacob A. DarlingJacob A. Darling, Vice President
 Signature Page




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JOINDER
 Joinder Joinder Parties
 Waivers
        Agreements
   Joinder Page 51




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Joinder Page 52




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JOINDER PARTY:
    
    WINSTON HOTELS, INC.,a North Carolina corporationBy:
    
    /s/ Jacob A. DarlingJacob A. Darling, Vice President
 Joinder Signature Page




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EXHIBIT A
 Legal Description
 Exhibit Page




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SCHEDULE I
 DEFEASANCE
  Release Date
     i)
    
    a security agreement in form and substance
satisfactory to Lender, creating a first priority lien on the U.S.
Obligations (hereinafter defined) purchased by or on behalf of Borrower
that will provide payments on or prior to, but as close as possible to
all successive Payment Dates after the Release Date, including the
amounts due on the Maturity Date, as it may be accelerated in
accordance with Section 2.3(c) of the Agreement and Section 2 of this
Schedule I (the Security Agreement);ii)
    
    a release of the Project from the lien of the
Mortgage and the release of Borrower from its obligations under this
Agreement, the Mortgage and the Note (for execution by Lender) in a
form appropriate for the jurisdiction in which the Project is located;iii)
    
    an officers certificate of Borrower certifying
that the requirements set forth in this paragraph (e) have been
satisfied;iv)
    
    an opinion of counsel in form and substance,
and rendered by counsel satisfactory to Lender at the expense of
Borrower, stating, among other things, that Lender has a perfected
first priority security interest in the U.S. Obligations purchased by
or on behalf
 Schedule Page 55




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of Borrower and pledged to Lender and as to enforceability of the
Security Agreement and other documents delivered in connection
therewith;v)
    
    if required by the Rating Agencies and/or
pooling and servicing agreement relating to the Secondary Market
Transaction, evidence in writing from the applicable Rating Agencies to
the effect that such release will not result in a qualification,
downgrade or withdrawal of any rating in effect immediately prior to
such defeasance for any securities issued in connection with a
Secondary Market Transaction;vi)
    
    evidence of satisfaction of all requirements of
the Successor Borrower, including payment if required of administrative
expenses and applicable federal income taxes associated with or to be
incurred by Successor Borrower during the remaining term of, and
applicable to, the Loan; andvii)
    
    such other certificates, documents or
instruments as Lender may reasonably request.
  Schedule I
 Scheduled Defeasance Payments Schedule I
 Schedule Page 56




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th Schedule I Schedule
I
 Schedule I Schedule Successor Borrower Assignment Agreement Schedule I Schedule
 Schedule I
 Yield Maintenance Amount
 U.S. Obligations Government Securities
 Schedule Page 57




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SCHEDULE II
 REQUIRED REPAIRS
 Schedule Page 58




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SCHEDULE III
 REPLACEMENT MANAGERS
 Schedule Page 59




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SCHEDULE IV
 RADIUS HOTELS
 Schedule Page 60