Document:

Amendment No. 3 to Microsoft Corporation/WebTV Shopping Insertion Order

 Exhibit 10.24 
  
 AMENDMENT 3 TO MICROSOFT CORPORATION / WEBTV SHOPPING INSERTION ORDER 
  
 This Amendment 3 is made pursuant to that certain Microsoft Corporation / WebTV Shopping Insertion Order and the attached
Microsoft Corporation Non-Standard Terms and Conditions dated June 26, 2000 by and between Microsoft Corporation and Proflowers (“Company”) and amended by that certain Amendment to Microsoft Corporation / WebTV Shopping Insertion Order
dated September 7, 2001 and Amendment 2 dated August 22, 2002, whereby Microsoft Corporation assigned its rights and obligations thereunder to Microsoft Online, LP (collectively, the “Agreement”), and sets forth the terms pursuant
to which Company will participate in the shopping placements in the MSN Shopping Channel (“MSN Shopping”), MSN TV Service Shopping Center as well as other Microsoft Corporation owned or controlled sites (collectively, the
“Microsoft Shopping Channels”). Hereinafter Microsoft Corporation and Microsoft Online, LP will be referred to either collectively or individually as “Microsoft.” 
  
 Microsoft and Company hereby agree to modify the Agreement as follows,
effective immediately: 
  

	1.	 	All references to “eShop” in the Agreement shall be deemed deleted, and the words “MSN Shopping” shall be deemed inserted therein. 

  

	2.	 	The Term, Total Fees and Order Summary outlined in the Agreement will be deemed deleted, and such elements will be amended and deemed inserted as set forth below:

  
 Account Executive: Seth Dallaire 
 Email: [*] 
  

	Company:	  	 Proflowers
	  	Agency:	  	 n/a

	Contact:	  	 5005 Wateridge Vista Drive
 San Diego, CA 92121
 Contact: Mark Irace
 [*]
 TEL: [*}
	  	Contact:	  	 
				
	Site URL:	  	 www.proflowers.com
	  	Term:	  	 [*]

				
	 	  	 	  	Total Fees:	  	See Exhibit 1-B

  

	 Ad Elements

	  	 Order Total

	  	 Total Minimum Ad Results

			
	 Microsoft Shopping Channel placements (See Exhibit 1-A)
 [*]
	  	$3,200,000	  	[*]
			
	 Additional Placements (See Exhibit 1-A)
 [*]
	  	Included above	  	n/a

  

	3.	 	CANCELLATION: The parties agree that Section 6 of the Agreement shall be deemed deleted, and the following shall be deemed inserted therein: 

  
 If either Microsoft or Company materially defaults under this Agreement, the
non-defaulting party will notify the other in writing. If the failure is not cured within ten (10) business days after written notice is received by the notified party, the non-defaulting party may terminate this Agreement immediately with no
further obligation to the notified party. Upon expiration of this Agreement, or if Microsoft terminates this Agreement due to Company’s willful and/or intentional breach (including, but not limited to, Company’s failure to pay Microsoft),
Company will immediately pay any amounts of the Total Fees not yet paid. If Microsoft terminates this Agreement due to an unintentional breach by Company: (a) prior to [*], Company shall be obligated to render payment of [*] in the amount of [*] to
Microsoft; or (b) [*], Company shall be obligated to render payment of any amounts of the Total Fees not yet paid. If Company terminates due to an uncured default by Microsoft, Company will be obligated to render payments to Microsoft through the
effective date of termination. If Microsoft terminates due to an uncured default by Company, Microsoft will be obligated to serve Company’s advertisements through the effective date of termination. 
  

	*	 	Material has been omitted pursuant to a request for confidential treatment. 

	4.	 	REPORTS: The parties agree that Section 7 of the Agreement shall be deleted, and the following shall be deemed inserted therein: 

  
 Company will provide reports or access to online reports from a third party
approved by Microsoft [*] of the Term, and such reports will include the following information, outlined [*]: (a) clicks; and (b) [*]. Company acknowledges that Microsoft is [*] for [*] received by Company. If Microsoft’s [*] Company, the
parties will mutually agree upon an alternate length for each tracking session within [*] following such finding by Microsoft. 
  

	5.	 	The parties agree that Section 17 of the Agreement shall be deleted, and the following Section shall be deemed inserted therein as Section 17, “FEATURED SITES”:

  
 A. Placements: Company will receive the
Featured Sites words and closely related variants set forth in Exhibit 1-A on a non-exclusive basis commencing on the date of first exhibition of Company’s links by Microsoft and continuing through the end of the Term. Company’s site will
receive placement in relevant MSN user searches, however, Microsoft cannot guarantee Company’s placement and/or ranking within the “Featured Sites” section of MSN Search. If Company does not receive [*] placement within Featured
Sites, Microsoft will notify Company at least [*] prior to the Featured Sites change and provide an alternate solution to capture the lost orders associated with the Featured Sites placement change. Microsoft will deliver ad requests in promotion of
the Featured Sites words, however, such ad requests are not guaranteed to Company, and Microsoft’s failure to deliver such ad requests shall not be deemed a breach of this Agreement or entitle Company to any legal remedy. Microsoft reserves the
right to update the MSN Search template at any time during the Term. 
  
 B. Delivery: During the Term, Microsoft will make reasonable efforts to deliver [*] to Company’s site from search results on any Microsoft site. Microsoft is not obligated to deliver [*] evenly throughout the Term. Failure by
Microsoft to deliver a certain number of clicks shall not be deemed a breach of this Agreement or entitle Company to any legal remedy. 
  
 C. Featured Sites Cancellation: At any time during the Term, either party may terminate the Featured Sites portion of this Agreement upon thirty
(30) days’ prior written notice to the other party. In such event, Microsoft will exercise one of the following options within ten (10) business days following the date of the Featured Sites termination notice in its sole discretion. Microsoft
will either: (x) perform the obligations set forth in Section 17.D, and Company will remain obligated to render payment to Microsoft for such placements through the effective date of termination (but shall not owe Microsoft any additional
consideration for Microsoft’s obligations set forth in Section 17.D); or (y) Microsoft will reduce the Fee (as such term is defined in Exhibit 1-B) by a rate [*] click delivered by Microsoft through the effective date of termination of the MSN
Search Featured Sites placement. The total Featured Sites value baseline is [*]. The total click delivery for the Term is projected at [*]. Following each party’s performance as set forth above, the parties will be relieved of their respective
obligations solely with respect to the MSN Search Featured Sites placements. The cancellation rights set forth in this Section 17.C will not pertain to Company’s Microsoft Shopping Channel placements. 
  
 D. Alternate placements. If the Featured Sites portion of this
Agreement is terminated by Company, Microsoft shall serve ad requests until Company achieves the number of orders (“Lost Orders”) projected to be achieved during the time from the termination to the expiration date (“Lost Order
Period”). The number of Lost Orders is quantified based upon the historical ratio of orders to ad requests [*] prior to the termination date (and is currently [*]). Dividing the number of ad requests that should have been delivered over the
Lost Order Period by the number of ad requests historically necessary to achieve [*], results in the number of Lost Orders that Microsoft shall serve. For example, if the historical ratio is [*] and [*] ad requests should have been delivered over
the Lost Order Period, then Microsoft would have to achieve [*] orders. The obligations of this Section 17.D shall survive termination of the Agreement. 
  

	*	 	Material has been omitted pursuant to a request for confidential treatment. 

	6.	 	The parties agree that Exhibits 1-A, 1-B attached to Amendment 1 and Exhibits 1-A, 1-B attached to Amendment 2 shall be deemed deleted, and Exhibit 1-B attached hereto shall be
deemed inserted therein. 

  
 This Amendment 3 and the Exhibits 1-A
and 1-B attached hereto, shall be attached to and incorporated into the Agreement, and are subject to all the terms and conditions of the Agreement. Whereby the parties enter into this Amendment 3 and the Exhibits 1-A and 1-B attached hereto, as of
the later of the two dates below. 
  

	 Microsoft
	    	 Company

	MICROSOFT ONLINE, LP	    	PROFLOWERS.COM
	 6100 Neil Road
	    	 5005 Wateridge Vista Drive, Second Floor

	 Reno, NV 89570
	    	 San Diego, CA 92121

		
	 By                            /s/ Joanne Bradford

	    	 By                        /s/ Abigail Sorenson

	 (Sign)
	    	 (Sign)

		
	 Joanne Bradford

	    	 Abigail Sorenson

	 Name (Print)
	    	 Name (Print)

		
	 VP MSN Sales

	    	 Senior Marketing Manager

	 Title
	    	 Title

		
	 7/25/2003

	    	 7/24/03

	 Date
	    	 Date

  
 Program Contact: See Account
Executive above 

 EXHIBIT 1-A 
  

	 	  	 Proj Annual Ad Requests

	 MSN Shopping
	  	 [*]

	 [*]
	  	 [*]

	 [*]
	  	 [*]

	 [*]
	  	 [*]

	 Media Programming (1)
	  	 [*]

	 Content [*] (2)
	  	 [*]

	 Content [*] (2)
	  	 [*]

	 MSN Exclusives
	  	 
	 (1) MSN does not report ad requests on these placements; only transfers.
	  	 
	 MSN Shopping Network Merchandising
	  	 
	 Network [*]
	  	 [*]

	 Network [*]
	  	 [*]

		
	 [*]
	  	 [*]

		
	 	  	 Proj Annual Ad Requests

	 MSN Search
	  	 [*]

	 MSN Search [*]
	  	 [*]

	 MSN Search [*]
	  	 [*]

		
	 	  	 Proj Annual Ad Requests

	 MSN.com
	  	 [*]

	 MSN.com [*]
	  	 [*]

	 MSN.com [*]
	  	 [*]

	 MSN.com [*]**
	  	 [*]

	 MSN.com [*]**
	  	 [*]

	 MSN.com [*]**
	  	 [*]

	 **MSN does not report ad requests for these placements; only transfers.
	  	 

  

	*	 	Material has been omitted pursuant to a request for confidential treatment. 

	 	  	 Proj Annual Ad Requests

	 MSNBC
	  	 [*]

	 [*]
	  	 [*]

	 [*]
	  	 [*]

		
	 	  	 Proj Annual Ad Requests

	 Hotmail
	  	 [*]

	 Hotmail [*]
	  	 [*]

	 Hotmail [*]
	  	 [*]

	 Hotmail [*]
	  	 [*]

	 Hotmail [*]
	  	 [*]

  

 (1) The media programming ad requests above are a non-binding estimate; Microsoft
makes no warranty regarding the number of media programming ad requests which will be delivered under this Agreement. Notwithstanding the foregoing, Microsoft will report [*] delivered by Microsoft to Company’s site as the result of such
placements. Company agrees that Microsoft will count [*] delivered each day Company’s advertisements appear on MSN.com (including the MSN Shopping [*], and the network information pane) for a period of [*]. 
  
 Microsoft will make reasonable efforts to deliver the total ad requests and [*] from the MSN
Shopping, Search and cross-MSN placements set forth above (the “Delivery Goal”), unless otherwise agreed upon by the parties. If Microsoft fails to provide the Delivery Goal by the end of the Term, Company’s [*] until the
Delivery Goal is met. 
  
 (2) [*] dates will be determined by Microsoft in its sole discretion. 
  
 The ad requests set forth above are a non-binding estimate, however, Microsoft is obligated to provide the Total Minimum Ad Requests set forth on the first page of this
Schedule. Microsoft makes no warranty about [*] ad request totals, a particular cost per acquisition or a certain return on investment metric which may be delivered to Company hereunder. 
  
 Microsoft will provide placement to Company in the placements set forth above, or in like placement (in terms of size and placement), as
such like placements are determined by Microsoft in its reasonable discretion. 

	*	 	Material has been omitted pursuant to a request for confidential treatment. 

 MSN SEARCH FEATURED SITE WORDS 
  

	 Keyword
	 	 [*]

	 [*]
	 	 

  

	*	 	Material has been omitted pursuant to a request for confidential treatment. 

  

	 [*]
	 	 [*]

  
 MSN SEARCH [*] WORDS

	 [*]
	  	 [*]
	  	 [*]

  

	*	 	Material has been omitted pursuant to a request for confidential treatment. 

 EXHIBIT 1-B 
 TOTAL FEES 
  
 The Total Fees shall be
comprised of the following elements: 
  

	1.	 	Fee. Company will pay Microsoft a flat fee of three million two hundred thousand dollars (US $3,200,000) (the “Fee”) in consideration for [*] ad requests from the
elements set forth in Exhibit 1-A. The Fee is a guaranteed payment to Microsoft, except as set forth in Section 4 of this Amendment. The Fee will be rendered to Microsoft in [*]. The [*] payment hereunder is due when [*]. Microsoft will invoice
Company for the [*], and Company will pay such invoiced amounts within [*] following the date of such invoice. 

  

	2.	 	Bounty Fee. 

  

	 	2.1.	 	During the Term, Microsoft will make reasonable efforts to deliver [*] to Company’s site (the [*]). 

  

	 	2.2.	 	If Microsoft provides [*] to Company, Company will pay Microsoft [*] Microsoft in [*] (the “Bounty Fees”) allowing for [*]. 

  

	 	2.3.	 	Payment of Bounty Fees (if any) called for by this Section 2 will be paid on [*] basis, in arrears within [*] after the end of any [*] as to which Bounty Fees are payable. Company
will remit to Microsoft the aggregate Bounty Fees due, together with a statement specifying the aggregate number of [*] in the applicable [*]. 

  

	 	2.4.	 	Company agrees to keep all usual and proper records and books of account and all usual and proper entries relating to Company’s obligations described in this Section 2.
Microsoft shall have the right to cause, at its sole cost and expense, an audit and/or an inspection to be made of the applicable Company records in order to verify Company’s compliance with the terms of this Agreement. Any audit and/or
inspection shall be conducted during regular business hours upon at least thirty (30) days prior written notice [as per Section 5B of the Agreement]. 

  

	 	2.5.	 	The parties will meet on a [*] basis during the Term to monitor and manage the placements. Following each such meeting, the parties may revise the placements in an effort to
optimize [*] to Company’s site. 

  

	 	2.6.	 	Company will be billed for Bounty Fees [*] Microsoft, however, Microsoft will not be required to refund or otherwise return to Company any portion of the Fee for [*]. Failure by
Microsoft to meet [*] shall not be deemed a breach of this Agreement or entitle Company to any legal remedy. Microsoft is not obligated to deliver [*] evenly throughout the Term 

  

	*	 	Material has been omitted pursuant to a request for confidential treatment.<PAGE>
                                                                    Exhibit 4.1

                              INNKEEPERS USA TRUST
                              --------------------

                    AMENDED AND RESTATED DECLARATION OF TRUST

     Innkeepers USA Trust (the "Trust"), a Maryland real estate investment trust
("REIT") under Title 8 of the Corporations and Associations Article of the
Annotated Code of Maryland ("Title 8"), desires to amend and restate its
Declaration of Trust as currently in effect and as hereinafter amended and
restated.

     The following provisions are all the provisions of the Declaration of Trust
currently in effect and as hereinafter amended and restated:

                                   ARTICLE I

                                   FORMATION

     The Trust is a REIT within the meaning of Title 8. The Trust shall not be
deemed to be a general partnership, limited partnership, joint venture, joint
stock company or a corporation (but nothing herein shall preclude the Trust from
being treated for tax purposes as an association under the Code)

                                   ARTICLE II

                                      NAME

     The name of the Trust is:

           Innkeepers USA Trust

     Under circumstances in which the board of Trustees of the Trust (the "Board
of Trustees" or "Board") determines that the use of the name of the Trust is not
practicable, the Trust may use any other designation or name for the Trust.

<PAGE>

                                  ARTICLE III

                               PURPOSE AND POWERS

     Section 1. Purposes. The purposes for which the Trust is formed are to
invest in and to acquire, hold, manage, administer, control end dispose of
property, including, without limitation or obligation, engaging in business as a
REIT under the Internal Revenue Code of 1986, as amended (the "Code").

     Section 2. Powers. The Trust shall have all of the powers granted to REITs
by Title 8 and all other powers set forth in the Declaration of Trust which are
not inconsistent with law and are appropriate to promote and attain the purposes
set forth in the Declaration of Trust.

                                   ARTICLE IV

                                 RESIDENT AGENT

     The name of the resident agent of the Trust in the State of Maryland is
James J. Hanks, Jr., whose post office address is c/o Ballard Spahr Andrews &
Ingersoll, 300 East Lombard Street, Baltimore, Maryland 21202. The resident
agent is a citizen of and resides in the State of Maryland. The Trust may have
such offices or places of business within or outside the State of Maryland as
the Board of Trustees of the Trust may from time to time determine.

                                   ARTICLE V

                                BOARD OF TRUSTEES

     Section 1. Powers.

            (A) Subject to any express limitations contained
in the Declaration of Trust or in the Bylaws, (i) the business and affairs of
the Trust shall be managed under the direction of the Board of Trustees and (ii)
the Board shall have full, exclusive and absolute power, control and authority
over any and all property of the Trust. The Board may take any action as it, in
its sole judgment and discretion, deems necessary or appropriate to conduct the
business and affairs of the Trust. The Declaration of Trust shall be construed
with a presumption in favor of the grant of

                                       2

<PAGE>

power and authority to the Board. Any construction of the Declaration of Trust
or determination made in good faith by the Board concerning its powers and
authority hereunder shall be conclusive. The enumeration and definition of
particular powers of the Trustees included in the Declaration of Trust or in the
Bylaws shall in no way be limited or restricted by reference to or inference
from the terms of this or any other provision of the Declaration of Trust or the
Bylaws or construed or deemed by inference or otherwise in any manner to exclude
or limit the powers conferred upon the Board of Trustees under the general laws
of the State of Maryland or any other applicable laws.

     (B) The Board, without any action by the shareholders of the Trust, shall
have and may exercise, on behalf of the Trust, without limitation, except for
the provisions of Article III, Section 6(b) of the Bylaws, the power to adopt,
amend and repeal Bylaws to the extent provided in Article XII of the Bylaws; to
elect officers in the manner prescribed in the Bylaws; to solicit proxies from
holders of shares of beneficial interest of the Trust; and to do any other acts
and deliver any other documents necessary or appropriate to the foregoing
powers.

     (C) It shall be the duty of the Board of Trustees to ensure that the Trust
satisfies the requirements for qualification as a REIT under the Code,
including, but not limited to, the ownership of outstanding shares of its
beneficial interest, the nature of its assets, the sources of its income, and
the amount and timing of its distributions to its shareholders. The Board of
Trustees shall take no action to disqualify the Trust as a REIT or to otherwise
revoke the Trust's election to be taxed as a REIT without the affirmative vote
of two thirds of the number of shares of Common Shares entitled to vote on such
matter at a meeting of the shareholders.

     Section 2. Classification and Number. (A) The Trustees of the Trust
(hereinafter the "Trustees") shall be classified, with respect to the terms for
which they severally hold office, into three classes, as nearly equal in number
as possible, one class ("Class I") to hold office initially for a term expiring
at the first annual meeting of shareholders, another class ("Class II") to hold
office initially for a term expiring at the second succeeding annual meeting of

                                       3

<PAGE>

shareholders and another class ("Class III") to hold office initially for a term
expiring at the third succeeding annual meeting of shareholders, with the
Trustees of each class to hold office until their successors are duly elected
and qualify. At each annual meeting of shareholders, the successors to the class
of Trustees whose term expires at such meeting shall be elected to hold office
for a term expiring at the annual meeting of shareholders held in the third year
following the year of their election. Shareholder votes to elect Trustees shall
be conducted in the manner provided in the Bylaws.

(B) The number of Trustees initially shall be one (1), which number may be
increased or decreased pursuant to the Bylaws of the Trust. The name, address
and class of the Trustee who shall serve as the initial Trustee and until his
successor is duly elected and qualifies are:

Name                          Address                            Class
----                          -------                            -----
Jeffrey H. Fisher             Suite 100                          Class III
                              5525 Federal Highway
                              Boca Raton, Florida 33487

This Trustee may increase the number of Trustees and fill any vacancy, whether
resulting from an increase in the number of Trustees or otherwise, on the Board
of Trustees prior to the first annual meeting of shareholders in the manner
provided in the Bylaws.

     Section 3. Resignation, Removal or Death. Any Trustee may resign by written
notice to the Board, effective upon execution and delivery to the Trust of such
written notice or upon any future date specified in the notice. A Trustee may be
removed at any time, with or without cause, at a meeting of the shareholders, by
the affirmative vote of the holders of not less than two thirds of the Shares
then outstanding and entitled to vote generally in the election of Trustees.

     Section 4. Independent Trustees. Notwithstanding anything herein to the
contrary, at all times (except during a period not to exceed sixty (60) days
following the death,

                                       4

<PAGE>

resignation, incapacity or removal from office of a Trustee prior to expiration
of the Trustee's term of office), a majority of the Board of Trustees shall be
comprised of persons who are not officers or employees of the Trust or
"Affiliates" of (i) any lessee of any property of the Trust, (ii) any subsidiary
of the Trust or (iii) any partnership which is an Affiliate of the Trust. This
section may not be amended, altered, changed or repealed without the affirmative
vote of 85% of the members of the Board of Trustees or the affirmative vote of
two thirds of the Shares then outstanding and entitled to vote on this matter.

     Section 5. Definition of Affiliate. For purposes of the foregoing
subsection, "Affiliate" of a person shall mean (i) any person that, directly or
indirectly, controls or is controlled by or is under common control with such
person, (ii) any other person that owns, beneficially, directly or indirectly,
five percent (5%) or more of the outstanding capital shares, shares or equity
interests of such person, or (iii) any officer, director, employee, partner or
trustee of such person or of any person controlling, controlled by or under
common control with such person (excluding trustees and persons serving in
similar capacities who are not otherwise an Affiliate of such person). The term
"person" means and includes individuals, corporations, general and limited
partnerships, stock companies or associations, joint ventures, associations,
companies, trusts, banks, trust companies, land trusts, business trusts, or
other entities and governments and agencies and political subdivisions thereof.
For the purposes of this definition, "control" (including the correlative
meanings of the terms "controlled by" and "under common control with"), as used
with respect to any person, shall mean the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of
such person, through the ownership of voting securities, partnership interests
or other equity interests.

                                       5

<PAGE>

                                   ARTICLE VI

                          SHARES OF BENEFICIAL INTEREST

     Section 1. Authorized Shares. The beneficial interest of the Trust shall be
divided into shares of beneficial interest (the "Shares"). The Trust has
authority to issue one hundred million (100,000,000) common shares of beneficial
interest, $.01 par value per share ("Common Shares"), and twenty million
(20,000,000) preferred shares of beneficial interest, $.01 par value per share
("Preferred Shares").

     Section 2. Common Shares. Subject to the provisions of Article VII, each
Common Share shall entitle the holder thereof to one vote on each matter upon
which holders of Common Shares are entitled to vote. The Board of Trustees may
reclassify any unissued Common Shares from time to time in one or more classes
or series of Shares.

     Section 3. Preferred Shares. The Board of Trustees may classify any
unissued Preferred Shares and reclassify any previously classified but unissued
Preferred Shares of any series from time to time, in one or more series of
Shares.

     Section 4. Classified or Reclassified Shares. Prior to issuance of
classified or reclassified Shares of any class or series, the Board of Trustees
by resolution shall (a) designate that class or series to distinguish it from
all other classes and series of Shares; (b) specify the number of Shares to be
included in the class or series; (c) set, subject to the provisions of Article
VII and subject to the express terms of any class or series of Shares
outstanding at the time, the preferences, conversion or other rights, voting
powers, restrictions, limitations as to dividends or other distributions,
qualifications and terms and conditions of redemption for each series; and (d)
cause the Trust to file articles supplementary with the State Department of
Assessments and Taxation of Maryland ("SDAT"). Any of the terms of any class or
series of Shares set pursuant to clause (c) of this Section 4 may be made
dependent upon facts or events ascertainable outside the Declaration of Trust
(including determinations by the Board of Trustees or other facts or events
within the control of the Trust) and may vary among holders thereof, provided
that the

                                       6

<PAGE>

manner in which such facts, events or variations shall operate upon the terms of
such class or series of Shares is clearly and expressly set forth in articles
supplementary filed with the SDAT.

     Section 5. Authorization by Board of Share Issuance. The Board of Trustees
may authorize the issuance from time to time of Shares of any class or series,
whether now or hereafter authorized, or securities or rights convertible into
Shares of any class or series, whether now or hereafter authorized, for such
consideration (whether in cash, property, past or future services, obligation
for future payment or otherwise) as the Board of Trustees may deem advisable (or
without consideration in the case of a Share split or Share dividend), subject
to such restrictions or limitations, if any, as may be set forth in the
Declaration of Trust or the Bylaws of the Trust.

     Section 6. Dividends and Distributions. The holders of all common Shares
will participate equally in dividends payable to holders of Common Shares when
and as authorized and declared by the Board of Trustees and in net assets
available for distribution to holders of Common Shares upon liquidation or
dissolution. The Board of Trustees may from time to time authorize and declare
to shareholders such dividends or distributions, in cash or other assets of the
Trust or in securities of the Trust or from any other source as the Board of
Trustees in its discretion shall determine. The Board of Trustees shall endeavor
to declare and pay such dividends and distributions as shall be necessary for
the Trust to qualify as a REIT under the Code; however, shareholders shall have
no right to any dividend or distribution unless and until authorized and
declared by the Board. The exercise of the powers and rights of the Board of
Trustees pursuant to this Section shall be subject to the provisions of any
class or series of Shares at the time outstanding.

     Section 7. General Nature of Shares. All Shares shall be personal property
entitling the shareholders only to those rights provided in the Declaration of
Trust. The shareholders shall have no interest in the property of the Trust and
shall have no right to compel any partition, division, dividend or distribution
of the Trust or of the property of the Trust. The

                                       7

<PAGE>

death of a shareholder shall not terminate the Trust. The Trust is entitled to
treat as shareholders only those persons in whose names Shares are registered as
holders of Shares on the beneficial interest ledger of the Trust.

     Section 8. Fractional Shares. The Trust may, without the consent or
approval of any shareholder, issue fractional Shares, eliminate a fraction of a
Share by rounding up or down to a full Share, arrange for the disposition of a
fraction of a Share by the person entitled to it, or pay cash for the fair value
of a fraction of a Share.

     Section 9. Declaration of Trust and Bylaws. All shareholders are subject to
the provisions of the Declaration of Trust and the Bylaws of the Trust.

                                  ARTICLE VII

                  RESTRICTIONS ON TRANSFER AND SHARES-IN-TRUST

     Section 1. Restrictions on Transfer.

          (A) Definitions. The following terms shall have the following
     meanings:

               (1) "Beneficial Ownership" shall mean ownership of Equity Shares
          by a Person who would be treated as an owner of such Equity Shares
          either directly or indirectly through the application of Section 544
          of the Code, as modified by Section 856(h)(1)(B) of the Code. The
          terms "Beneficial Owner," "Beneficially Owns," and "Beneficially
          Owned" shall have correlative meanings.

               (2) "Beneficiary" shall mean, with respect to any Share Trust,
          one or more organizations described in each of Section 170(b)(1)(A)
          (other than clauses (vii) or (viii) thereof) and Section 170(c)(2) of
          the Code that are named by the Trust as the beneficiary or
          beneficiaries of such Share Trust, in accordance with the provisions
          of Section 2(A) hereof.

               (3) "Board of Trustees" shall mean the Board of Trustees of the
          Trust.

                                       8

<PAGE>

               (4) "Code" shall mean the Internal Revenue Code of 1986, as
          amended from time to time.

               (5) "Constructive Ownership" shall mean ownership of Equity
          Shares by a Person who would be treated as an owner of such Equity
          Shares either directly or indirectly through the application of
          Section 318 of the Code, as modified by Section 856(d)(5) of the Code.
          The terms "Constructive Owner," "Constructively owns," and
          "Constructively Owned" shall have correlative meanings.

               (6) "Equity Shares" shall mean Preferred Shares and Common
          Shares. The term "Equity Shares" shall include all Preferred Shares
          and Common Shares that are held as Shares-in-Trust in accordance with
          the provisions of Section 2 hereof.

               (7) "Innkeepers USA Partnership Agreement" shall mean the
          agreement of limited partnership of Innkeepers USA Limited
          Partnership, a Virginia limited partnership, as amended and restated.

               (8) "Initial Public Offering" means the sale of Common Shares
          pursuant to the Trust's first effective registration statement for
          such Common Shares filed under the Securities Act of 1933, as amended.

               (9) "Market Price" on any date shall mean the average of the
          Closing Price for the five consecutive Trading Days ending on such
          date. The "Closing Price" on any date shall mean the last sale price,
          regular way, or, in case no such sale takes place on such day, the
          average of the closing bid and asked prices, regular way, in either
          case as reported in the principal consolidated transaction reporting
          system with respect to securities listed or admitted to trading on the
          New York Stock Exchange or, if the Equity Shares are not listed or
          admitted to trading on the New York Stock Exchange, as reported in the
          principal consolidated transaction reporting system with respect to
          securities listed on the principal national securities exchange on
          which the Equity Shares are listed or admitted to trading or, if the
          Equity Shares are not listed or admitted to trading on any national
          securities exchange, the last quoted price, or if not so quoted,

                                       9

<PAGE>

          the average of the high bid and low asked prices in the
          over-the-counter market, as reported by the National Association of
          Securities Dealers, Inc. Automated Quotation System or, if such system
          is no longer in use, the principal other automated quotations system
          that may then be in use or, if the Equity Shares are not quoted by any
          such organization, the average of the closing bid and asked prices as
          furnished by a professional market maker making a market in the Equity
          Shares selected by the Board of Trustees. "Trading Day" shall mean a
          day on which the principal national securities exchange on which the
          Equity Shares are listed or admitted to trading is open for the
          transaction of business or, if the Equity Shares are not listed or
          admitted to trading on any national securities exchange, shall mean
          any day other than a Saturday, a Sunday or a day on which banking
          institutions in the State of New York are authorized or obligated by
          Law or executive order to close.

               (10) "Non-Transfer Event" shall mean an event (other than a
          purported Transfer) that would cause any Person to Beneficially Own or
          Constructively Own Equity Shares in excess of the Ownership Limit,
          including, but not limited to, the granting of any option or entering
          into any agreement for the sale, transfer or other disposition of
          Equity Shares or the sale, transfer, assignment or other disposition
          of any securities or rights convertible into or exchangeable for
          Equity Shares.

               (11) "Ownership Limit" shall mean, with respect to the Common
          Shares, 9.8% of the number of outstanding Common Shares and, with
          respect to any series of Preferred Shares, 9.8% of the number of
          outstanding Preferred Shares of such series.

               (12) "Permitted Transferee" shall mean any Person designated as a
          Permitted Transferee in accordance with the provisions of Section 2(E)
          hereof.

               (13) "Person" shall mean an individual, corporation, partnership,
          estate, trust, a portion of a trust permanently set aside for or to be
          used exclusively for the purposes described in Section 642(c) of the
          Code, association, private foundation within the meaning of Section
          509(a) of the Code, joint stock company or other entity and also
          includes a

                                       10

<PAGE>

          "group" as that term is used for purposes of Section 13(d)(3) of the
          Securities Exchange Act of 1934, as amended.

               (14) "Prohibited Owner" shall mean, with respect to any purported
          Transfer or Non-Transfer Event, any Person who, but for the provisions
          of Section 1(C) hereof, would own record title to Equity Shares.

               (15) "Redemption Rights" shall mean the rights granted under the
          Innkeepers USA Partnership Agreement to the limited partners to
          redeem, under certain circumstances, their limited partnership
          interests for Common Shares (or cash at the option of the Trust).

               (16) "REIT" shall mean a real estate investment trust under
          Section 856 of the Code.

               (17) "Restriction Termination Date" shall mean the first day
          after the date of the Initial Public Offering on which the Board of
          Trustees and the shareholders of the Trust determine, pursuant to
          Article V, Section 1(C), that it is no longer in the best interests of
          the Trust to attempt to, or continue to, qualify as a REIT.

               (18) "Shares-in-Trust" shall mean any Equity Shares designated
          Shares-in-Trust pursuant to Section 1(C) hereof.

               (19) "Share Trust" shall mean any separate trust created pursuant
          to Section 1(C) hereof and administered in accordance with the terms
          of Section 2 hereof, for the exclusive benefit of any Beneficiary.

               (20) "Share Trustee" shall mean any person or entity unaffiliated
          with both the Trust and any Prohibited Owner, such Share Trustee to be
          designated by the Trust to act as trustee of any Share Trust, or any
          successor trustee thereof.

               (21) "Transfer" (as a noun) shall mean any sale, transfer, gift,
          assignment, devise or other disposition of Equity Shares, whether
          voluntary or involuntary,

                                       11

<PAGE>

          whether of record, constructively or beneficially and whether by
          operation of law or otherwise. "Transfer" (as a verb) shall not have
          the correlative meaning.

            (B) Restriction on Transfers.

               (1) Except as provided in Section 1(G) hereof, from the date of
          the Initial Public Offering and prior to the Restriction Termination
          Date, (i) no Person shall Beneficially Own or Constructively Own
          outstanding Equity Shares in excess of the Ownership Limit and (ii)
          any Transfer that, if effective, would result in any Person
          Beneficially Owning or Constructively Owning Equity Shares in excess
          of the Ownership Limit shall be void ab initio as to the Transfer of
          that number of Equity Shares which would be otherwise Beneficially
          Owned or Constructively Owned by such Person in excess of the
          Ownership Limit, and the intended transferee shall acquire no rights
          in such excess Equity Shares.

               (2) Except as provided in Section 1(G) hereof, from the date of
          the Initial Public Offering and prior to the Restriction Termination
          Date, any Transfer that, if effective, would result in the Equity
          Shares being beneficially owned by fewer than 100 Persons (determined
          without reference to any rules of attribution) shall be void ab initio
          as to the Transfer of that number of shares which would be otherwise
          beneficially owned (determined without reference to any rules of
          attribution) by the transferee, and the intended transferee shall
          acquire no rights in such excess Equity Shares.

               (3) From the date of the Initial Public Offering and prior to the
          Restriction Termination Date, any Transfer of Equity Shares that, if
          effective, would result in the Trust being "closely held" within the
          meaning of Section 856(h) of the Code shall be void ab initio as to
          the Transfer of that number of Equity Shares which would cause the
          Trust to be "closely held" within the meaning of Section 856(h) of the
          Code, and the intended transferee shall acquire no rights in such
          excess Equity Shares.

               (4) From the date of the Initial Public Offering and prior to the
          Restriction Termination Date, any Transfer of Equity Shares that, if
          effective, would cause the

                                       12

<PAGE>

          Trust to Constructively Own 10% or more of the ownership interests in
          a tenant of the Trust's real property, within the meaning of Section
          856(d)(2)(B) of the Code, shall be void ab initio as to the Transfer
          of that number of Equity Shares which would cause the Trust to
          Constructively Own 10% or more of the ownership interests in a tenant
          of the Trust's real property, within the meaning of Section
          856(d)(2)(B) of the Code, and the intended transferee shall acquire no
          rights in such excess Equity Shares.

            (C) Transfer to Share Trust.

               (1) If, notwithstanding the other provisions contained in this
          Section 1, at any time after the date of the Initial Public Offering
          and prior to the Restriction Termination Date, there is a purported
          Transfer or Non-Transfer Event such that any Person would either
          Beneficially Own or Constructively Own Equity Shares in excess of the
          Ownership Limit, then, (i) except as otherwise provided in Section
          1(G) hereof, the purported transferee shall acquire no right or
          interest (or, in the case of a Non-Transfer Event, the person holding
          record title to the Equity Shares Beneficially Owned or Constructively
          Owned by such Beneficial Owner or Constructive Owner, shall cease to
          own any right or interest) in such number of Equity Shares which would
          cause such Beneficial Owner or Constructive Owner to Beneficially Own
          or Constructively Own Equity Shares in excess of the Ownership Limit,
          (ii) such number of Equity Shares in excess of the Ownership Limit
          (rounded up to the nearest whole share) shall be designated
          Shares-in-Trust and, in accordance with the provisions of Section 2
          hereof, transferred automatically and by operation of law to the Share
          Trust to be held in accordance with that Section 2 and (iii) the
          Prohibited Owner shall submit such number of Equity Shares to the
          Trust for registration into the name of the Share Trust. Such transfer
          to a Share Trust and the designation of shares as Shares-in-Trust
          shall be effective as of the close of business on the business day
          prior to the date of the Transfer or Non-Transfer Event, as the case
          may be.

               (2) If, notwithstanding the other provisions contained in this
          Section 1, at any time after the date of the Initial Public Offering
          and prior to the Restriction Termination

                                       13

<PAGE>

     Date, there is a purported Transfer or Non-Transfer Event that, if
     effective, would (i) result in the Equity Shares being beneficially owned
     by fewer than 100 Persons (determined without reference to any rules of
     attribution), (ii) result in the Trust being "closely held within the
     meaning of Section 856(h) of the Code, or (iii) cause the Trust to
     constructively own 10% or more of the ownership interests in a tenant of
     the Trust's real property, within the meaning of Section 856(d)(2)(B) of
     the Code, then (x) the purported transferee shall not acquire any right or
     interest (or, in the case of a Non-Transfer Event, the person holding
     record title of the Equity Shares with respect to which such Non-Transfer
     Event occurred, shall cease to own any right or interest) in such number of
     Equity Shares, the ownership of which by such purported transferee or
     record holder would (A) result in the Equity Shares being beneficially
     owned by fewer than 100 Persons (determined without reference to any rules
     of attribution), (B) result in the Trust being "closely held" within the
     meaning of Section 856(h) of the Code, or (C) cause the Trust to
     Constructively Own 10% or more of the ownership interests in a tenant of
     the Trust's real property, within the meaning of Section 856(d)(2)(B) of
     the Code, (y) such number of Equity Shares (rounded up to the nearest whole
     share) shall be designated Shares-in-Trust and, in accordance with the
     provisions of Section 2 hereof, transferred automatically and by operation
     of law to the Share Trust to be held in accordance with that Section 2, and
     (z) the Prohibited Owner shall submit such number of Equity Shares to the
     Trust for registration into the name of the Share Trust. Such transfer to a
     Share Trust and the designation of shares as Shares-In-Trust shall be
     effective as of the close of business on the business day prior to the date
     of the Transfer or Non-Transfer Event, as the case may be.

          (D) Remedies For Breach. If the Trust, or its designees, shall at any
     time determine in good faith that a Transfer has taken place in violation
     of Section 1(B) hereof or that a Person intends to acquire or has attempted
     to acquire Beneficial Ownership or Constructive Ownership of any Equity
     Shares in violation of Section 1(B) hereof, the Trust shall take such
     action as it deems advisable to refuse to give effect to or to prevent such
     Transfer or acquisition,

                                       14

<PAGE>

     including, but not limited to, refusing to give effect to such Transfer on
     the books of the Trust or instituting proceedings to enjoin such Transfer
     or acquisition.

          (E) Notice of Restricted Transfer. Any Person who acquires or attempts
     to acquire Equity Shares in violation of Section 1(B) hereof, or any Person
     who owned Equity Shares that were transferred to the Share Trust pursuant
     to the provisions of Section 1(C) hereof, shall immediately give written
     notice to the Trust of such event and shall provide to the Trust such other
     information as the Trust may request in order to determine the effect, if
     any, of such Transfer or Non-Transfer Event, as the case may be, on the
     Trust's status as a REIT.

          (F) Owners Required To Provide Information. From the date of the
     Initial Public Offering and prior to the Restriction Termination Date:

               (1) Every Beneficial Owner or Constructive Owner of more than 5%,
          or such lower percentages as required pursuant to regulations under
          the code, of the outstanding Equity Shares of the Trust shall, within
          30 days after January 1 of each year, provide to the Trust a written
          statement or affidavit stating the name and address of such Beneficial
          Owner or Constructive Owner, the number of Equity Shares Beneficially
          Owned or Constructively Owned, and a description of how such shares
          are held. Each such Beneficial Owner or Constructive Owner shall
          provide to the Trust such additional information as the Trust may
          request in order to determine the effect, if any, of such Beneficial
          Ownership or Constructive ownership on the Trust's status as a REIT
          and to ensure compliance with the Ownership Limit.

               (2) Each Person who is a Beneficial Owner or Constructive Owner
          of Equity Shares and each Person (including the shareholder of record)
          who is holding Equity Shares for a Beneficial Owner or Constructive
          Owner shall provide to the Trust a written statement or affidavit
          stating such information as the Trust may request in order to
          determine the Trust's status as a REIT and to ensure compliance with
          the Ownership Limit.

          (G) Exception. The Ownership Limit shall not apply to the acquisition
     of Equity Shares by an underwriter that participates in a public offering
     of such shares for a period

                                       15

<PAGE>

     of 90 days following the purchase by such underwriter of such shares
     provided that the restrictions contained in Section 1(B), hereof will not
     be violated following the distribution by such underwriter of such shares.
     In addition, the Board of Trustees, upon receipt of a ruling from the
     Internal Revenue Service or an opinion of counsel in each case to the
     effect that the restrictions contained in Section l(B)(2), Section 1(B)(3),
     and/or Section 1(B)(4) hereof will not be violated, may exempt a Person
     from the Ownership Limit provided that (i) the Board of Trustees obtains
     such representations and undertakings from such Person as are reasonably
     necessary to ascertain that no individual's Beneficial Ownership or
     Constructive Ownership of Equity Shares will, violate the Ownership Limit
     and (ii) such Person agrees that any violation or attempted violation will
     result in a transfer to the Share Trust of Equity Shares pursuant to
     Section 1(C) hereof.

        Section 2. Shares-in-Trust.

          (A) Share Trust. Any Equity shares transferred to a Share Trust and
     designated Shares-in-Trust pursuant to Section 1(C) hereof shall be held
     for the exclusive benefit of the Beneficiary. The Trust shall name a
     beneficiary of each Share Trust within five days after discovery of the
     existence thereof. Any transfer to a Share Trust, and subsequent
     designation of Equity Shares as Shares-in-Trust, pursuant to Section 1(C)
     hereof shall be effective as of the close of business on the business day
     prior to the date of the Transfer or Non-Transfer Event that results in the
     transfer to the Share Trust. Shares-in-Trust shall remain issued and
     outstanding Equity Shares of the Trust and shall be entitled to the same
     rights and privileges on identical terms and conditions as are all other
     issued and outstanding Equity Shares of the same class and series. When
     transferred to a Permitted Transferee in accordance with the provisions of
     Section 2(E) hereof, such Shares-in-Trust shall cease to be designated as
     Shares-in-Trust.

          (B) Dividend Rights. The Share Trust, as record holder of
     Shares-in-Trust, shall be entitled to receive all dividends and
     distributions as may be declared by the Board of Trustees on such Equity
     Shares and shall hold such dividends or distributions in trust for the

                                       16

<PAGE>

     benefit of the Beneficiary. The Prohibited Owner with respect to
     Shares-in-Trust shall repay to the Share Trust the amount of any dividends
     or distributions received by it that (i) are attributable to any Equity
     Shares designated Shares-in-Trust and (ii) the record date for which was on
     or after the date that such shares became Shares-in-Trust. The Trust shall
     take all measures that it determines reasonably necessary to recover the
     amount of any such dividend or distribution paid to a Prohibited Owner,
     including, if necessary, withholding any portion of future dividends or
     distributions payable on Equity Shares Beneficially Owned or Constructively
     Owned by the Person who, but for the provisions of Section 1 (C) hereof,
     would Constructively Own or Beneficially Own the Shares-in-Trust; and, as
     soon as reasonably practicable following the Trust's receipt or withholding
     thereof, shall pay over to the Share Trust for the benefit of the
     Beneficiary the dividends so received or withheld, as the case may be.

            (C) Rights Upon Liquidation. In the event of any voluntary or
     involuntary liquidation, dissolution or winding up of, or any distribution
     of the assets of, the Trust, each holder of Shares-in-Trust shall be
     entitled to receive, ratably with each other holder of Equity Shares of the
     same class or series, that portion of the assets of the Trust which is
     available for distribution to the holders of such class and series of
     Equity Shares. The Share Trust shall distribute to the Prohibited Owner the
     amounts received upon such liquidation, dissolution, or winding up, or
     distribution; provided, however, that the Prohibited Owner shall not be
     entitled to receive amounts pursuant to this Section 2(C) in excess of, in
     the case of a purported Transfer in which the Prohibited Owner gave value
     for Equity Shares and which Transfer resulted in the transfer of the shares
     to the Share Trust, the price per share, if any, such Prohibited Owner paid
     for the Equity Shares and, in the case of a Non-Transfer Event or Transfer
     in which the Prohibited Owner did not give value for such shares (e.g., if
     the shares were received through a gift or devise) and which Non-Transfer
     Event or Transfer, as the case may be, resulted in the transfer of shares
     to the Share Trust, the price per share equal to the Market Price on the
     date of such Non-

                                       17

<PAGE>

     Transfer Event or Transfer. Any remaining amount in such Share Trust shall
     be distributed to the Beneficiary.

          (D) Voting Rights. The Share Trustee shall be entitled to vote all
     Shares-in-Trust. Any vote by a Prohibited Owner as a holder of Equity
     Shares prior to the discovery by the Trust that the Equity Shares are
     Shares-in-Trust shall, subject to applicable law, be rescinded and shall be
     void ab initio with respect to such Shares-in-Trust and the Prohibited
     Owner shall be deemed to have given, as of the close of business on the
     business day prior to the date of the purported Transfer or Non-Transfer
     Event that results in the transfer to the Share Trust of Equity Shares
     under Section 1(C) hereof, an irrevocable proxy to the Share Trustee to
     vote the Shares-in-Trust in the manner in which the Share Trustee, in its
     sole and absolute discretion, desires.

          (E) Designation of Permitted Transferee. The Share Trustee shell have
     the exclusive and absolute right to designate a Permitted Transferee of any
     and all Shares-in-Trust. In an orderly fashion so as not to materially
     adversely affect the Market Price of the Shares-in-Trust, the Share Trustee
     shall designate any Person as Permitted Transferee, provided, however, that
     (i) the Permitted Transferee so designated purchases for valuable
     consideration (whether in a public or private sale), at a price as set
     forth in Section 2(G) hereof, the Shares-in-Trust and (ii) the Permitted
     Transferee so designated may acquire such Shares-in-Trust without such
     acquisition resulting in a transfer to a Share Trust and the redesignation
     of such Equity Shares so acquired as Shares-in-Trust under Section 1(C)
     hereof. Upon the designation by the Share Trustee of a Permitted Transferee
     in accordance with the provisions of this Section 2(E), the Share Trustee
     shall (i) cause to be transferred to the Permitted Transferee that number
     of Shares-in-Trust acquired by the Permitted Transferee, (ii) cause to be
     recorded on the books of the Trust that the Permitted Transferee is the
     holder of record of such number of Equity Shares, (iii) cause the
     Shares-in-Trust to be canceled and (iv) distribute to the Beneficiary any
     and all amounts held with respect to the Shares-in-Trust after making the
     payment to the Prohibited Owner pursuant to Section 2(F) hereof.

                                       18

<PAGE>

          (F) Compensation to Record Holder of Equity Shares that Become
     Shares-in-Trust. Any Prohibited Owner shall be entitled (following
     discovery of the Shares-in-Trust and subsequent designation of the
     Permitted Transferee in accordance with Section 2(E) hereof or following
     the acceptance of the offer to purchase such shares in accordance with
     Section 2(G) hereof) to receive from the Share Trustee following the sale
     or other disposition of such Shares-in-Trust the lesser of (i) in the case
     of (a) a purported Transfer in which the Prohibited Owner gave value for
     Equity Shares and which Transfer resulted in the transfer of the shares to
     the Share Trust, the price per share, if any, such Prohibited Owner paid
     for the Equity Shares, or (b) a Non-Transfer Event or Transfer in which the
     Prohibited Owner did not give value for such shares (e.g., if the shares
     were received through a gift or devise) and which Non-Transfer Event or
     Transfer, as the case may be, resulted in the transfer of shares to the
     Share Trust, the price per share equal to the Market Price on the date of
     such Non-Transfer Event or Transfer and (ii) the price per share received
     by the Share Trustee from the sale or other disposition of such
     Shares-in-Trust in accordance with Section 2(E) hereof. Any amounts
     received by the Share Trustee in respect of such Shares-in-Trust and in
     excess of such amounts to be paid the Prohibited Owner pursuant to this
     Section 2(F) shall be distributed to the Beneficiary in accordance with the
     provisions of Section 2(E) hereof. Each Beneficiary and Prohibited Owner
     waive any and all claims that they may have against the Share Trustee and
     the Share Trust arising out of the disposition of Shares-in-Trust, except
     for claims arising out of the gross negligence or willful misconduct of, or
     any failure to make payments in accordance with this Section 2 by such
     Share Trustee or the Trust.

          (G) Purchase Right in Shares-in-Trust. Shares-in-Trust shall be deemed
     to have been offered for sale to the Trust, or its designee, at a price per
     share equal to the lesser of (i) the price per share in the transaction
     that created such Shares-in-Trust (or, in the case of devise, gift or
     Non-Transfer Event, the Market Price at the time of such devise, gift or
     Non-Transfer Event) and (ii) the Market Price on the date the Trust, or its
     designee, accepts such offer. The Trust shall have the right to accept such
     offer for a period of ninety days after the later of (i)

                                       19

<PAGE>

     the date of the Non-Transfer Event or purported Transfer which resulted in
     such Shares-in-Trust and (ii) the date the Trust determines in good faith
     that a Transfer or Non-Transfer Event resulting in Shares-in-Trust has
     occurred, if the Trust does not receive a notice of such Transfer or
     Non-Transfer Event pursuant to Section 1(E) hereof.

          Section 3. Remedies Not Limited. Nothing contained in this Article VII
     shall limit the authority of the Trust to take such other action as it
     deems necessary or advisable to protect the Trust and the interests of its
     shareholders by preservation of the Trust's status as a REIT and to ensure
     compliance with the Ownership Limit.

          Section 4. Ambiguity. In the case of an ambiguity in the application
     of any of the provisions of Article VII, including any definition contained
     in Section 1(A) hereof, the Board of Trustees shall have the power to
     determine the application of the provisions of this Article VII with
     respect to any situation based on the facts known to it.

          Section 5. Legend. Each certificate for Equity Shares shall bear the
     following legend:

          "The [Common or Preferred] Shares represented by this certificate are
     subject to restrictions on transfer for the purpose of the Trust's
     maintenance of its status as a real estate investment trust under the
     Internal Revenue Code of 1986, as amended (the "Code"). No Person may (i)
     Beneficially Own or Constructively Own Common Shares in excess of 9.8% of
     the number of outstanding Common Shares; (ii) Beneficially Own or
     Constructively Own Preferred Shares of any series of Preferred Shares in
     excess of 9.8% of the number of outstanding Preferred Shares of such
     series, (iii) beneficially own Equity Shares that would result in the
     Equity Shares being beneficially owned by fewer than 100 Persons
     (determined without reference to any rules of attribution), (iv)
     Beneficially Own Equity Shares that would result in the Trust being
     "closely held" under Section 856(h) of the Code, or (v) Constructively Own
     Equity Shares that would cause the Trust to Constructively Own 10% or more
     of the ownership interests in a tenant of the Trust's real property, within
     the meaning of Section 856(d)(2)(B) of the Code. Any Person who

                                       20

<PAGE>

     attempts to Beneficially Own or Constructively Own shares of Equity Shares
     in excess of the above limitations must immediately notify the Trust in
     writing. If the restrictions above are violated, the Equity Shares
     represented hereby will, be transferred automatically and by operation of
     law to a Share Trust and shall be designated Shares-in-Trust. All
     capitalized terms in this legend have the meanings defined in the Trust's
     Amended and Restated Declaration of Trust, as the same may be further
     amended from time to time, a copy of which, including the restrictions on
     transfer, will be sent without charge to each shareholder who so requests.

          Section 6. Severability. If any provision of this Article VII or any
     application of any such provision is determined to be invalid by any
     federal or state court having jurisdiction over the issues, the validity of
     the remaining provisions shall not be affected and other applications of
     such provision shall be affected only to the extent necessary to comply
     with the determination of such court.

                                  ARTICLE VIII

                                  SHAREHOLDERS

          Section 1. Meetings. There shall be an annual meeting of the
     shareholders, to be held on proper notice at such time (after the delivery
     of the annual report) and convenient location as shall be determined by or
     in the manner prescribed in the Bylaws, for the election of the Trustees,
     if required, and for the transaction of any other business within the
     powers of the Trust. Except as otherwise provided in this Declaration of
     Trust, special meetings of shareholders may be called in the manner
     provided in the Bylaws. If there are no Trustees, the officers of the Trust
     shall promptly call, a special meeting of the shareholders entitled to vote
     for the election of successor Trustees. Any meeting may be adjourned and
     reconvened as the Trustees determine or as provided in the Bylaws.

          Section 2. Voting Rights. Subject to the provisions of any class or
     series of Shares then outstanding, the shareholders shall be entitled to
     vote only on the following matters:

                                       21

<PAGE>

     (a) termination of REIT status as provided in Article V, Section (1)(C);
     (b) election of Trustees as provided in Article V, Section 2(A) and the
     removal of Trustees as provided in Article V, Section 3; (c) amendment of
     the Declaration of Trust as provided in Article X; (d) termination of the
     Trust as provided in Article XIII, Section 2; (e) merger or consolidation
     of the Trust, or the sale or disposition of substantially all of the Trust
     Property, as provided in Article XI; and (f) such other matters with
     respect to which a vote of the shareholders is required by applicable law
     or the Board of Trustees has adopted a resolution declaring that a proposed
     action is advisable and directing that the matter be submitted to the
     shareholders for approval or ratification. Except with respect to the
     foregoing matters, no action taken by the shareholders at any meeting shall
     in any way bind the Board of Trustees.

          Section 3. Preemptive and Appraisal Rights. Except as may be provided
     by the Board of Trustees in setting the terms of classified or reclassified
     Shares pursuant to Article VI, Section 4, no holder of Shares shall, as
     such holder, (a) have any preemptive or preferential right to purchase or
     subscribe for any additional Shares of the Trust or any other security of
     the Trust which it may issue or sell or (b), except as expressly required
     by Title 8, have any right to require the Trust to pay him the fair value
     of his Shares in an appraisal or similar proceeding.

          Section 4. Extraordinary Actions. Except as specifically provided in
     Article V, Sections 1(C), 2(A), 3, and 4, and Article VIII, Article X,
     Sections 2 and 3, and Article XIII, Section 2 of this Declaration of Trust,
     notwithstanding any provision of law permitting or requiring any action to
     be taken or authorized by the affirmative vote of the holders of a greater
     number of votes, any such action shall be effective and valid if taken or
     authorized by the affirmative vote of holders of Shares entitled to cast a
     majority of all the votes entitled to be cast on the matter.

          Section 5. Board Approval. The submission of any action to the
     shareholders for their consideration shall first be approved by the Board
     of Trustees.

                                       22

<PAGE>

                                   ARTICLE IX

                      LIABILITY LIMITATION, INDEMNIFICATION

                         AND TRANSACTIONS WITH THE TRUST

     Section 1. Limitation of Shareholder Liability. No shareholder shall be
liable for any debt, claim, demand, judgment or obligation of any kind of,
against or with respect to the Trust by reason of his being a shareholder, nor
shall any shareholder be subject to any personal liability whatsoever, in tort,
contract or otherwise, to any person in connection with the property or the
affairs of the Trust by reason of his being a shareholder.

     Section 2. Limitation of Trustee and Officer Liability. To the maximum
extent that Maryland law in effect from time to time permits limitation of the
liability of trustees and officers of a REIT, no Trustee or officer of the Trust
shall be liable to the Trust or to any shareholder for money damages. Neither
the amendment nor repeal of this Section, nor the adoption or amendment of any
other provision of the Declaration of Trust or Bylaws of the Trust inconsistent
with this section, shall apply to or affect in any respect the applicability of
the preceding sentence with respect to any act or failure to act which occurred
prior to such amendment, repeal or adoption. In the absence of any Maryland
statute limiting the liability of trustees and officers of a Maryland REIT for
money damages in a suit by or on behalf of the Trust or by any shareholder, no
Trustee or officer of the Trust shall be liable to the Trust or to any
shareholder for money damages except to the extent that (a) the Trustee or
officer actually received an improper benefit or profit in money, property, or
services, for the amount of the benefit or profit in money, property, or
services actually received; or (b) a judgment or other final adjudication
adverse to the Trustee or officer is entered in a proceeding based on a finding
in the proceeding that the Trustee's or officer's action or failure to act was
the result of active and deliberate dishonesty and was material to the cause of
action adjudicated in the proceeding.

     Section 3. Indemnification. The Trust, to the maximum extent permitted by
Maryland law in effect from time to time, shall indemnity and
pay or reimburse reasonable

                                       23

<PAGE>

expenses in advance of final disposition of a proceeding to, (a) any individual
who is a present or former shareholder, Trustee or officer of the Trust or (b)
any individual who, while a Trustee of the Trust and at the request of the
Trust, serves or has served as a director, officer, partner, trustee, employee
or agent of another corporation, partnership, joint venture, trust, employee
benefit plan or other enterprise from and against any claim or liability to
which such person may become subject or which such person may incur by reason of
his status as a present or former shareholder, Trustee or officer of the Trust.
The Trust shall have the power, with the approval of its Board of Trustees, to
provide such indemnification and advancement of expenses to a person who served
as a predecessor of the Trust in any of the capacities described in (a) or (b)
above, and to any employee or agent of the Trust or a predecessor of the Trust.

     Section 4. Transactions Between the Trust and its Trustees, Officers,
Employees and Agents. Subject to any express restrictions in the Declaration of
Trust or adopted by the Trustees in the Bylaws or by resolution, the Trust may
enter into any contract or transaction of any kind with any person, including
any Trustee, officer, employee or agent of the Trust or any person affiliated
with a Trustee, officer, employee or agent of the Trust, whether or not any of
them has a financial interest in such transaction.

                                   ARTICLE X

                                   AMENDMENTS

     Section 1. General. The Trust reserves the right from time to time to make
any amendment to the Declaration of Trust, now or hereafter authorized by law,
including any amendment altering the terms or contract rights, as expressly sat
forth in the Declaration of Trust, of any Shares. All rights and powers
conferred by this Declaration of Trust on shareholders, Trustees and officers
are granted subject to this reservation. An amendment to the Declaration of
Trust (a) shall be signed and acknowledged by at least a majority of the
Trustees, (b) shall be filed for record with SDAT as provided in Title 8 and (c)
shell become effective as of the later of

                                       24

<PAGE>

the time the SDAT accepts the amendment for record or the time established in
the amendment, not to exceed 30 days after the amendment is accepted for record.
All references to the Declaration of Trust shall include all amendments thereto.

     Section 2. By Trustees. The Trustees may amend the Declaration of Trust
from time to time, in the manner provided by Title 8, without any action by the
shareholders, to qualify as a REIT under the Code or under Title 8.

     Section 3. By Shareholders. Other than amendments pursuant to Section 2 of
this Article X, any amendment to the Declaration of Trust shall be valid only if
approved by the affirmative vote of at least a majority of all the votes
entitled to be cast on the matter, except that any amendment to Article V,
Sections 1(C), 2(A), 3 and 4, and Article VII, and Article X, Sections 2 and 3,
and Article XIII, Section 2, and Article XII of the Declaration of Trust shall
be valid only it approved by the affirmative vote of two thirds of all the votes
entitled to be cast on the matter.

                                   ARTICLE XI

                 MERGER, CONSOLIDATION OR SALE OF TRUST PROPERTY

     Subject to the provisions of any class or series of Shares at
the time outstanding, the Trust may (a) merge the Trust into another entity, (b)
consolidate the Trust with one or more other entities into a new entity or (C)
sell, lease, exchange or otherwise transfer all, or substantially all of the
Trust Property. Any such action must be approved by the Board of Trustees and,
after notice to all shareholders entitled to vote on the matter, by the
affirmative vote of a majority of all the votes entitled to be cast on the
matter.

                                  ARTICLE XII

                           LIMITATION ON INDEBTEDNESS

     The Trust may not incur Indebtedness (as defined below) in an amount in
excess of forty percent (40%) of the Trust's investment in hotel properties, at
cost, after giving effect to

                                       25

<PAGE>

the Trust's use of proceeds from any Indebtedness. For purposes of the foregoing
restrictions, "Indebtedness" of the Trust shall mean all obligations of the
Trust, its subsidiaries or any partnership in which the Trust serves as general
partner, for borrowed money (including all notes payable and drafts accepted
representing extensions of credit) and all obligations evidenced by bonds,
debentures, notes or other similar instruments on which interest charges are
customarily paid, including obligations under capital leases.

                                  ARTICLE XIII

                        DURATION AND TERMINATION OF TRUST

     Section 1. Duration. The Trust shall continue perpetually unless terminated
pursuant to Section 2 of this Article XII or pursuant to any applicable
provision of Title 8.

     Section 2. Termination.

          (a) Subject to the provision of any class or series of Shares at the
     time outstanding, the Trust may be terminated at any meeting of
     shareholders, by the affirmative vote of two thirds of all the votes
     entitled to be cast on the matter. Upon the termination of the Trust:

               (i) The Trust shall carry on no business except for the purpose
          of winding up its affairs.

               (ii) The Trustees shall proceed to wind up the affairs of the
          Trust and all of the powers of the Trustees under the Declaration of
          Trust shall continue, including the powers to fulfill or discharge the
          Trust's contracts, collect its assets, sell, convey, assign, exchange,
          transfer or otherwise dispose of all or any part of the remaining
          property of the Trust to one or more persons at public or private sale
          for consideration which may consist in whole or in part of cash,
          securities or other property of any kind, discharge or pay its
          liabilities and do all other acts appropriate to liquidate its
          business.

               (iii) After paying or adequately providing for the payment of all
          liabilities, and upon receipt of such releases, indemnities and
          agreements as they deem necessary

                                       26

<PAGE>

for their protection, the Trust may distribute the remaining property of the
Trust among the shareholders so that after payment in full or the setting apart
for payment of such preferential amounts, if any, to which the holders of any
Shares at the time outstanding shall be entitled, the remaining property of the
Trust shall, subject to any participating or similar rights of Shares at the
time outstanding, be distributed ratably among the holders of Common Shares at
the time outstanding.

     (b) After termination of the Trust, the liquidation of its business and the
distribution to the shareholders as herein provided, a majority of the Trustees
shall execute and file with the Trust's records a document certifying that the
Trust has been duly terminated, and the Trustees shall be discharged from all
liabilities and duties hereunder, and the rights and interests of all
shareholders shall cease.

                                       27

<PAGE>

     IN WITNESS WHEREOF, this Amended and Restated Declaration of Trust has been
signed on this 21st day of September, 1994, by the sole Trustee of the Trust who
acknowledges that this document is his free act and deed, and that to the best
of his knowledge, information, and belief, the matters and facts set forth
herein are true in all material respects and that the statement is made under
the penalties for perjury.

     The undersigned acknowledges that the shareholders of the Trust have
approved this Amended and Restated Declaration of Trust as required by Maryland
law.

                                           /s/ Jeffrey H. Fisher        (SEAL)
                                           -----------------------------
                                           Jeffrey H. Fisher, Trustee

                                       28

<PAGE>

                              INNKEEPERS USA TRUST
                              --------------------

                        AMENDMENT OF DECLARATION OF TRUST

THIS IS TO CERTIFY THAT:

         FIRST: The Declaration of Trust of Innkeepers USA Trust, a Maryland
real estate investment trust (the "Company"), is hereby amended by deleting the
following trustee's name and address set forth in Section 2 of Article V:

         Name                              Address
         ----                              ---------
         Jeffrey H. Fisher                 Suite 100
                                           5255 North Federal Highway
                                           Boca Raton, Florida 33487

and inserting in lieu thereof the following trustees' names and addresses:

         Name                               Address
         ----                              ---------

         Jeffrey H. Fisher                 Suite 100
                                           5255 North Federal Highway
                                           Boca Raton, Florida 33487

         Miles Berger                      Suite 300
                                           5255 North Federal Highway
                                           Boca Raton, Florida 33487

         Nicholas A. Buoniconti            Suite 300
                                           5255 North Federal Highway
                                           Boca Raton, Florida 33487

         Bruce Zenkel                      Suite 300
                                           5255 North Federal Highway
                                           Boca Raton, Florida 33487

         SECOND: The foregoing amendment to the Declaration of Trust of the
Company has been duly approved by the Board of Trustees of the Company be at
least a two-thirds vote as required by law.

         THIRD: The undersigned acknowledges this amendment to be the trust act
of the Company and, as to all matters or facts required to be verified under
oath, the undersigned acknowledges that, to the best of his knowledge,
information and belief, these matters and facts are true in all material
respects and that this statement is made under the penalties for perjury.

<PAGE>

         IN WITNESS WHEREOF, the Company has caused this amendment to be signed
in its name and on its behalf by its President and attested to by its Secretary
on this 4th day of October, 1995.

ATTEST:                                 INNKEEPERS USA TRUST

/s/ David Bulger                        /s/ Jeffrey H. Fisher            (SEAL)
------------------                      ---------------------------------
David Bulger                            Jeffrey H. Fisher
Secretary                               President

                                       2

<PAGE>

                              INNKEEPERS USA TRUST
                              --------------------

                        AMENDMENT OF DECLARATION OF TRUST

THIS IS TO CERTIFY THAT:

     FIRST: The Amended and Restated Declaration of Trust, as amended (the
"Declaration of Trust"), of Innkeepers USA Trust, a Maryland real estate
investment trust (the "Company"), is hereby amended by deleting the first
sentence of Article XII as follows:

          The Trust may not incur Indebtedness (as defined below) in an amount
     in excess of forty percent (40%) of the Trust's investment in hotel
     properties, at cost, after giving effect to the Trust's use of proceeds
     from any Indebtedness.

and inserting in lieu thereof the following sentence:

          The Trust may not incur Indebtedness (as defined below) in an amount
     in excess of fifty percent (50%) of the Trust's investment in hotel
     properties, at cost, after giving effect to the Trust's use of proceeds
     from any Indebtedness.

     SECOND: The foregoing amendment to the Declaration of Trust of the Company
has been duly approved by the shareholders of the Company by at least a
two-thirds vote of all votes entitled to be cast as required by the Declaration
of Trust.

     THIRD: The undersigned acknowledges this amendment to be the trust act of
the Company and, as to all matters or facts required to be verified under oath,
the undersigned acknowledges that, to the best of his knowledge, information and
belief, these matters and facts are true in all material respects and that this
statement is made under the penalties for perjury.

     IN WITNESS WHEREOF, the Company has caused this amendment to be signed in
its name and on its behalf by its duly authorized Secretary on this 18th day of
September, 1996.

                                            INNKEEPERS USA TRUST

                                            /s/ David Bulger             (SEAL)
                                            ---------------------------
                                            David Bulger
                                            Secretary

<PAGE>

                              INNKEEPERS USA TRUST
                              --------------------

                        AMENDMENT OF DECLARATION OF TRUST

THIS IS TO CERTIFY THAT:

     FIRST: The Amended and Restated Declaration of Trust, as amended (the
"Declaration of Trust"), of Innkeepers USA Trust, a Maryland real estate
investment trust (the "Company"), is hereby amended by adding to Article VII,
Section 1 a new Subsection (H) as follows:

          (H) Securities Exchange Transactions. Nothing in this Article VI or
     this Declaration of Trust shall prohibit the settlement of any transaction
     entered into through the facilities of any national securities exchange
     registered under the Securities Exchange Act of 1934, as amended (the
     "Exchange Act"), or of the national market system of a national securities
     association registered under the Exchange Act. The immediately preceding
     sentence shall not limit the authority of the Board of Trustees to take any
     and all actions it deems necessary or advisable to protect the Company and
     the interests of its shareholders in preserving the Company's status as
     REIT, so long as such actions do not prohibit the settlement of any
     transactions entered into through the facilities of any national securities
     exchange registered under the Exchange Act or of the national market system
     of a national securities association registered under the Exchange Act.

     SECOND: The Declaration of Trust of the Company is hereby amended by
deleting Article VII, Section 3 in its entirety and substituting therefor
the following:

          Section 3. Remedies Not Limited. Nothing contained in this Article VII
     shall limit the authority of the Trust to take such other action as it
     deems necessary or advisable to protect the Trust and the interests of its
     shareholders by preservation of the Trust's status as a REIT and to ensure
     compliance with the Ownership Limit, so long as such actions do not
     prohibit the settlement of any transaction entered into through the
     facilities of any national securities exchange registered under the
     Exchange Act or of the national market system of a national securities
     association registered under the Exchange Act.

     THIRD: The foregoing amendment to the Declaration of Trust of the Company
has been duly approved by the shareholders of the Company be at least a majority
vote of all votes entitled to be cast as required by the Declaration of Trust.

<PAGE>

     FOURTH: The undersigned acknowledges that this amendment to be the trust
act of the Company and, as to all matters or facts required to be verified under
oath, the undersigned acknowledges that, to the best of his knowledge,
information and belief, these matters and facts are true in all material
respects and that this statement is made under the penalties for perjury.

     IN WITNESS WHEREOF, the Company has caused this amendment to be signed on
its name and on its behalf by its duly authorized Secretary on this 12th day of
May, 1999.

                                         INNKEEPERS USA TRUST

                                         /s/ Mark Murphy
                                         ----------------------------
                                         Mark A. Murphy
                                         Secretary

                                       2

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