Document:

EXHIBIT 10.2

                    ENVIRONMENTAL INDEMNIFICATION AGREEMENT

     This Environmental Indemnification Agreement (this "Agreement") is made
and entered into effective for all purposes as of the 26th day of June , 2001,
by the parties signatory hereto or to an Accession Agreement (as hereinafter
defined) (collectively, the "Indemnitor" whether one or more), to and for the
benefit of SOCIETE GENERALE, SOUTHWEST AGENCY, as Joint Book Runner and
Administrative Agent (the "Administrative Agent"), BANK OF MONTREAL, CHICAGO
BRANCH as Syndication Agent (the "Syndication Agent"), DEUTSCHE BANC ALEX.
BROWN, as Joint Book Runner and Documentation Agent ("Documentation Agent"),
and the banks and other lenders named in the Credit Agreement herein described
(the "Banks").

                                 INTRODUCTION

     WHEREAS, this Agreement is given in connection with that certain Third
Amended and Restated Senior Unsecured Credit Agreement dated as of June 26,
2001 ("Credit Agreement"), among LASALLE HOTEL OPERATING PARTNERSHIP, L.P., a
Delaware limited partnership (the "Borrower"), Administrative Agent,
Syndication Agent, Documentation Agent and the banks and other lenders party
thereto (collectively the "Banks") pursuant to which the Banks are making,
subject to future advances, a loan in an amount up to $200,000,000.00 (the
"Loan") to Borrower as more specifically described therein;

     WHEREAS, the Borrower and Subsidiaries of the Borrower now or hereafter
will own certain Hotel Properties which include without limitation the Initial
Properties, the Future Properties, the Permitted Non-Eligible Properties and
the properties owned by the Permitted Other Subsidiaries (said properties
together with all property owned by the Participating Lessees in connection
with such Hotel Properties, all rights and appurtenances to such Hotel
Properties and all improvements presently located or hereafter constructed on
such Hotel Properties are hereinafter collectively called the "Properties",
and each a "Property");

     WHEREAS, the Borrower is the principal financing entity for capital
requirements of its Subsidiaries, and from time to time the Borrower has made
and will continue to make capital contributions and advances to its
Subsidiaries, including the Subsidiaries which are parties hereto. Other than
the Parent, each Indemnitor is a direct or indirect subsidiary of the
Borrower. Each Indemnitor will derive substantial direct and indirect benefit
from the transactions contemplated by the Credit Agreement; and

     WHEREAS, the Banks have required the execution and delivery of this
Agreement as a condition precedent to the execution of the Credit Agreement.
The Banks would not be willing to execute the Credit Agreement in the absence
of the execution and delivery by Indemnitor of this Agreement.

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                                   AGREEMENT
                                   ---------

     NOW, THEREFORE, Indemnitor, as an inducement to the Banks to make the
Loan, hereby covenants and agrees to and for the benefit of the Banks as
follows:

     1.   Defined Terms. All terms used in this Agreement, but not defined
          -------------
herein, shall have the meaning given such terms in the Credit Agreement.

     2.   Hazardous Material. As used in this Agreement, the term "Hazardous
          ------------------
Materials" shall mean any flammable explosives, radioactive materials,
hazardous wastes, hazardous materials, hazardous or toxic substances, or
related materials as defined in the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended (42 U.S.C.ss. 9601 et.
seq.), the Hazardous Materials Transportation Act, as amended (49 U.S.C.ss.
1801 et seq.), the Resource Conservation and Recovery Act, as amended (42
U.S.C.ss. 6901 et seq.), and in the regulations adopted and publications
promulgated pursuant thereto, and all friable asbestos, petroleum derivatives,
polychlorinated biphenyls, and materials defined as hazardous materials under
any federal, state or local laws, ordinances, codes, rules, orders,
regulations or policies governing the use, storage, treatment, transportation,
manufacture, refinement, handling, production or disposal thereof
(collectively, "Environmental Laws").

     3.   Representation. Except as set forth in the Environmental Reports,
          --------------
Indemnitor warrants and represents to the Banks that it has no knowledge of
(a) the presence of any Hazardous Materials on any of the Properties except
for Permitted Hazardous Substances; or (b) any material spills, releases,
discharges or disposal of Hazardous Materials that have occurred or are
presently occurring off any of the Properties as a result of any construction
on or operation and use of any of the Properties. In connection with the
operation and use of any of the Properties, Indemnitor warrants and represents
that, as of the date of this Agreement, it has no knowledge of any failure to
comply in all material respects with all applicable law, state and federal
environmental laws, regulations, ordinances and administrative and judicial
orders relating to the generation, recycling, reuse, sale, storage, handling,
transport and disposal of any Hazardous Materials other than as set forth in
the Environmental Reports.

     4.   Covenant. Indemnitor covenants and agrees not to cause or permit the
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presence, use, generation, release, discharge, storage, disposal or
transportation of any Hazardous Materials on, under, in, about, to or from any
of the Properties except for Permitted Hazardous Substances.

     5.   Indemnification. Indemnitor shall exonerate, indemnify, pay and
          ---------------
protect, defend (with counsel approved pursuant to the Credit Agreement) and
save the Administrative Agent, the Syndication Agent, the Documentation Agent,
the Banks, and their respective directors, trustees, beneficiaries, officers,
shareholders, employees and agents of the Banks (collectively, the
"Indemnified Parties"), harmless from and against any claims (including,
without limitation, third party claims for personal injury or real or personal
property damage), actions,

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administrative proceedings (including informal proceedings), judgments,
damages, punitive damages, penalties, fines, costs, taxes, assessments,
liabilities (including, without limitation, sums paid in settlements of
claims), interest or losses, including reasonable attorneys' fees and expenses
(including, without limitation, any such reasonable fees and expenses incurred
in enforcing this Agreement or collecting any sums due hereunder), consultant
fees, and expert fees, together with all other reasonable costs and expenses
of any kind or nature (collectively, the "Costs") that arise directly or
indirectly in connection with the presence, suspected presence, release or
suspected release of any Hazardous Materials in or into the air, soil, ground
water, surface water or improvements at, on, about, under or within any of the
Properties, or any portion thereof, or elsewhere in connection with the
transportation of Hazardous Materials to or from any of the Properties (any
such release being referred to herein as a "Release"); provided however that
Indemnitor shall not be so liable for any Costs arising because of the gross
negligence or willful misconduct of an Indemnified Party or Costs arising
because of a Release from or on a Property after the Administrative Agent or
the Administrative Agent's nominee acquires title to such Property.
INDEMNITOR'S OBLIGATION TO SO INDEMNIFY THE INDEMNIFIED PARTIES SHALL INCLUDE
INDEMNIFICATION FOR ANY OF SUCH MATTERS CAUSED IN WHOLE OR IN PART BY THE
NEGLIGENCE OF ANY OF THE INDEMNIFIED PARTIES. The indemnification provided in
this Section shall specifically apply to and include claims or actions brought
by or on behalf of tenants or employees of Indemnitor; Indemnitor hereby
expressly waives (with respect to any claims of the Indemnified Parties
arising under this Agreement) any immunity to which Indemnitor may otherwise
be entitled under any industrial or worker's compensation laws. In the event
any of the Indemnified Parties shall suffer or incur any such Costs,
Indemnitor shall pay to the Administrative Agent for the benefit of the
Indemnified Party the total of all such Costs suffered or incurred by such
Indemnified Party within ten (10) days after demand therefor, such payment to
be disbursed by the Administrative Agent in accordance with the Credit
Agreement. Without limiting the generality of the foregoing, the
indemnification provided by this Section 5 shall specifically cover Costs,
including, without limitation, capital, operating and maintenance costs,
incurred in connection with any investigation or monitoring of site
conditions, any clean-up, containment, remedial, removal or restoration work
required or performed by any federal, state or local governmental agency or
political subdivision ("Governmental Agency") or performed by any
non-governmental entity or person as required or requested, by any
Governmental Agency because of the presence, suspected presence, release or
suspected release of any Hazardous Materials in or into the air, soil,
groundwater, surface water or improvements at, on, under or within any of the
Properties (or any portion thereof), or elsewhere in connection with the
transportation of Hazardous Materials to or from any of the Properties, and
any claims of third parties for loss or damage due to such Hazardous
Materials.

     6.   Remedial Work. In the event any investigation or monitoring of site
          -------------
conditions or any clean-up, containment, restoration, removal or other
remedial work ("Remedial Work") is required (a) under any Environmental
Law, (b) by any judicial, arbitral or administrative order, (c) in order to
comply with any agreements affecting any of the Properties, or (d) to maintain
any of the Properties in a standard of environmental condition which prevents
the release or

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<PAGE>

generation of any Hazardous Materials except for Permitted Hazardous
Substances, Indemnitor shall perform or cause to be performed such Remedial
Work; provided, that Indemnitor may withhold commencement of such Remedial
Work pending resolution of any good faith contest regarding the application,
interpretation or validity of any law, regulation, order or agreement, subject
to the requirements of Section 7 below. All Remedial Work shall be conducted
(i) in a diligent and timely fashion by a licensed environmental engineer,
(ii) pursuant to a detailed written plan for the Remedial Work approved by any
Governmental Agency with a legal or contractual right to such approval, (iii)
with such insurance coverage pertaining to liabilities arising out of the
Remedial Work as is then customarily maintained with respect to such
activities and (iv) only following receipt of all required permits, licenses
or approvals. In addition, Indemnitor shall submit to the Banks promptly upon
receipt or preparation, copies of any and all reports, studies, analyses,
correspondence, governmental comments or approvals, proposed removal or other
Remedial Work contracts and similar information prepared or received by
Indemnitor in connection with any Remedial Work or Hazardous Materials
relating to any of the Properties. All costs and expenses of such Remedial
Work shall be paid by Indemnitor, including, without limitation, the charges
of the Remedial Work contractors and the consulting environmental engineer,
any taxes or penalties assessed in connection with the Remedial Work and the
Banks' reasonable fees and costs incurred in connection with monitoring or
review of such Remedial Work. In the event Indemnitor should fail to commence
or cause to be commenced such Remedial Work, in a timely fashion, or fail
diligently to prosecute to completion, such Remedial Work, the Administrative
Agent following consent of the Required Lenders (following thirty (30) days
written notice to Indemnitor) may, but shall not be required to, cause such
Remedial Work to be performed, and all costs and expenses thereof, or incurred
in connection therewith shall be Costs within the meaning of Section 5 above.
All such Costs shall be due and payable to the Administrative Agent by
Indemnitor upon thirty (30) days after demand therefor, such payments to be
disbursed by the Administrative Agent in accordance with the Credit Agreement.

     7.   Permitted Contests. Notwithstanding any provision of this Agreement to
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the contrary, Indemnitor may contest by appropriate action any Remedial Work
requirement imposed by any Governmental Agency or similar agency provided that
(a) Indemnitor has given the Banks written notice that Indemnitor is
contesting or shall contest and Indemnitor does in fact contest the
application, interpretation or validity of the law, regulation, order or
agreement pertaining to the Remedial Work by appropriate legal or
administrative proceedings conducted in good faith and with due diligence and
dispatch, (b) such contest shall not subject any of the Indemnified Parties
nor any assignee of all or any portion of the Banks' interest in the Loan nor
any of the Properties to civil or criminal liability and does not jeopardize
any such party's lien upon or interest in any of the Properties and (c) if the
estimated cost of the Remedial Work is greater than $1,000,000, Indemnitor
shall give such security or assurances as may be reasonably required by the
Banks as determined pursuant to the Credit Agreement to ensure ultimate
compliance with all legal or contractual requirements pertaining to the
Remedial Work (and payment of all costs, expenses, interest and penalties in
connection therewith) and to prevent any sale, forfeiture or loss by reason of
nonpayment or non-compliance.

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<PAGE>

     8.   Reports and Claims. Indemnitor shall deliver to the Banks copies of
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any reports, analyses, correspondence, notices, licenses, approvals, orders or
other written materials relating to the environmental condition of any of the
Properties promptly upon receipt, completion or delivery thereof. Indemnitor
shall give notice to the Banks of any claim, action, administrative proceeding
(including, without limitation, informal proceedings) or other demand by any
governmental agency or other third party involving Costs or Remedial Action at
the time such claim or other demand first becomes known to Indemnitor. Receipt
of any such notice shall not be deemed to create any obligation on the Banks
to defend or otherwise respond to any claim or demand. All notices, approvals,
consents, requests and demands upon the respective parties hereto shall be in
writing, including telegraphic communication and delivered or teletransmitted
to the Administrative Agent, as set forth in the Credit Agreement and to each
Indemnitor, at the address set forth beneath such Indemnitor's signature or in
the Accession Agreement executed by such Indemnitor, or to such other address
as shall be designated by any Indemnitor or the Administrative Agent in
written notice to the other parties. All such notices and other communications
shall be effective when delivered or teletransmitted to the above addresses.

     9.   Banks as Owner. If for any reason, the Administrative Agent or any of
          --------------
the Banks (or any successor or assign of such parties) becomes the fee owner
of any of the Properties and any claim, action, notice, administrative
proceeding (including, without limitation, informal proceedings) or other
demand is made by any governmental agency or other third party which implicate
Costs or Remedial Work, Indemnitor shall cooperate with such party in any
defense or other appropriate response to any such claim or other demand;
provided however that Indemnitor shall not be so liable for any Costs arising
because of the gross negligence or willful misconduct of an Indemnified Party.
Indemnitor's duty to cooperate and right to participate in the defense or
response to any such claim or demand shall not be deemed to limit or otherwise
modify Indemnitor's obligations under this Agreement. Any party subject to a
claim or other proceeding referenced in the first sentence of this Section 9
shall give notice to Indemnitor of any claim or demand governed by this
Section 9 at the time such claim or other demand first becomes known to such
party.

     10.  Subrogation of Indemnity Rights. If Indemnitor fails to fully perform
          -------------------------------
its obligations under Sections 5 and 6 above, the Indemnified Parties shall be
subrogated to any rights or claims Indemnitor may have against any present,
future or former owners, tenants or other occupants or users of any of the
Properties, any portion thereof or any adjacent or proximate properties,
relating to the recovery of Costs or the performance of Remedial Work.

     11.  Assignment by Agents and Banks. No consent by Indemnitor shall be
          ------------------------------
required for any assignment or reassignment of the rights of the
Administrative Agent, the Syndication Agent, the Documentation Agent or the
Banks under this Agreement to any successor of such party or a purchaser of
the Loan or any interest in or portion of the Loan including participation
interests in accordance with the terms of the Credit Agreement.

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<PAGE>

     12.  Merger, Consolidation or Sale of Assets. In the event Indemnitor is
          ---------------------------------------
dissolved, liquidated or terminated or all or substantially all the assets of
Indemnitor are sold or otherwise transferred to one or more persons or other
entities, the surviving entity or transferee of assets, as the case may be,
(i) shall be formed and existing under the laws of a state, (ii) shall deliver
to the Banks an acknowledged instrument in recordable form assuming all
obligations, covenants and responsibilities of Indemnitor under this
Agreement.

     13.  Independent Obligations; Survival. The obligations of Indemnitor
          ---------------------------------
under this Agreement shall survive the consummation of the Loan transaction
described above and the repayment of the Loan. The obligations of Indemnitor
under this Agreement are separate and distinct from the obligations of
Indemnitor under the Credit Documents. This Agreement may be enforced by the
Banks without regard to or affecting any rights and remedies the
Administrative Agent and/or the Banks may have against Indemnitor under the
Credit Documents and without regard to any limitations on the Administrative
Agent's or Banks' recourse for recovery of the Loan as may be provided in the
Credit Documents. Enforcement of this Agreement is not and shall not be deemed
to constitute an action for recovery of the indebtedness of the Loan.

     14.  Default Interest. In addition to all other rights and remedies of the
          ----------------
Banks against Indemnitor as provided herein, or under applicable law,
Indemnitor shall pay to the Administrative Agent, immediately upon demand
therefor, Default Interest (as defined below) on any Costs and other payments
required to be paid by Indemnitor to the Banks under this Agreement which are
not paid within ten (10) days after demand therefor, such payments to be
disbursed by the Administrative Agent in accordance with the Credit Agreement.
Default Interest shall be paid by Indemnitor from the date such payment
becomes delinquent through and including the date of payment of such
delinquent sums. "Default Interest" shall mean a per annum interest rate equal
to three percent (3%) above the Adjusted Base Rate or reference rate for the
then current calendar month, as of the first day of such calendar month, which
is publicly announced from time to time by the Administrative Agent.

     15.  Contribution. As a result of the transactions contemplated by the
          ------------
Credit Agreement, each of the Indemnitors will benefit, directly and
indirectly, from the Obligations and in consideration thereof desire to enter
into a contribution agreement among themselves as set forth in this Section 15
to allocate such benefits among themselves and to provide a fair and equitable
arrangement to make contributions in the event any payment is made by any
Indemnitor hereunder to the Administrative Agent, the Syndication Agent, the
Documentation Agent or the Banks (such payment being referred to herein as a
"Contribution," and for purposes of this Agreement, includes any exercise of
recourse by the Administrative Agent against any Property of a Contributor and
application of proceeds of the sale of such Property in satisfaction of such
Indemnitor's obligations under this Agreement). The Indemnitors hereby agree
as follows:

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<PAGE>

          15.1. Calculation of Contribution. In order to provide for just and
                ---------------------------
     equitable contribution among the Indemnitors in the event any
     Contribution is made by an Indemnitor (a "Funding Indemnitor"), such
     Funding Indemnitor shall be entitled to a contribution from certain other
     Indemnitors for all payments, damages and expenses incurred by that
     Funding Indemnitor in discharging any of the obligations under this
     Agreement (the "Obligations"), in the manner and to the extent set forth
     in this Section. The amount of any Contribution under this Agreement
     shall be equal to the payment made by the Funding Indemnitor to the
     Administrative Agent or any other beneficiary pursuant to this Agreement
     and shall be determined as of the date on which such payment is made.

          15.2. Benefit Amount Defined. For purposes of this Agreement, the
                ----------------------
     "Benefit Amount" of any Indemnitor as of any date of determination shall
     be the net value of the benefits to such Indemnitor and all of its
     Subsidiaries (including any Subsidiaries which may be Indemnitors) from
     extensions of credit made by the Banks to the Borrower under the Credit
     Agreement; provided, that in determining the contribution liability of
     any Indemnitor which is a Subsidiary to its direct or indirect parent
     corporation or of any Indemnitor to its direct or indirect Subsidiary,
     the Benefit Amount of such Subsidiary and its Subsidiaries, if any, shall
     be subtracted in determining the Benefit Amount of the parent
     corporation. Such benefits shall include benefits of funds constituting
     proceeds of Advances made to the Borrower by the Banks which are in turn
     advanced or contributed by the Borrower to such Indemnitor or its
     Subsidiaries and benefits of Letters of Credit issued pursuant to the
     Credit Agreement on behalf of, or the proceeds of which are advanced or
     contributed or otherwise benefit, directly or indirectly, such Indemnitor
     and its Subsidiaries (collectively, the "Benefits"). In the case of any
     proceeds of Advances or Benefits advanced or contributed to a Person (an
     "Owned Entity") any of the equity interests of which are owned directly
     or indirectly by an Indemnitor, the Benefit Amount of an Indemnitor with
     respect thereto shall be that portion of the net value of the benefits
     attributable to Advances or Benefits equal to the direct or indirect
     percentage ownership of such Indemnitor in its Owned Entity.

          15.3. Contribution Obligation. Each Indemnitor shall be liable to a
                -----------------------
     Funding Indemnitor in an amount equal to the greater of (A) the (i) ratio
     of the Benefit Amount of such Indemnitor to the total amount of
     Obligations, multiplied by (ii) the amount of Obligations paid by such
     Funding Indemnitor and (B) 95% of the excess of the fair saleable value
     of the property of such Indemnitor over the total liabilities of such
     Indemnitor (including the maximum amount reasonably expected to become
     due in respect of contingent liabilities) determined as of the date on
     which the payment made by a Funding Indemnitor is deemed made for
     purposes of this Agreement (giving effect to all payments made by other
     Funding Indemnitors as of such date in a manner to maximize the amount of
     such contributions).

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          15.4. Allocation. In the event that at any time there exists more
                ----------
     than one Funding Indemnitor with respect to any Contribution (in any such
     case, the "Applicable Contribution"), then payment from other Indemnitors
     pursuant to this Agreement shall be allocated among such Funding
     Indemnitors in proportion to the total amount of the Contribution made
     for or on account of the Borrower by each such Funding Indemnitor
     pursuant to the Applicable Contribution. In the event that at any time
     any Indemnitor pays an amount under this Agreement in excess of the
     amount calculated pursuant to clause (A) of Subsection 15.3 above, that
     Indemnitor shall be deemed to be a Funding Indemnitor to the extent of
     such excess and shall be entitled to contribution from the other
     Indemnitors in accordance with the provisions of this Section.

          15.5. Subsidiary Payment. The amount of contribution payable under
                ------------------
     this Section by any Indemnitor shall be reduced by the amount of any
     contribution paid hereunder by a Subsidiary of such Indemnitor.

          15.6. Equitable Allocation. If as a result of any reorganization,
                --------------------
     recapitalization, or other corporate change in the Borrower or any of its
     Subsidiaries, or as a result of any amendment, waiver or modification of
     the terms and conditions of other Sections of this Agreement or the
     Obligations, or for any other reason, the contributions under this
     Section become inequitable as among the Indemnitors, the Indemnitors
     shall promptly modify and amend this Section to provide for an equitable
     allocation of contributions. Any of the foregoing modifications and
     amendments shall be in writing and signed by all Indemnitors.

          15.7. Asset of Party to Which Contribution is Owing. The Indemnitors
                ---------------------------------------------
     acknowledge that the right to contribution hereunder shall constitute an
     asset in favor of the Indemnitor to which such contribution is owing.

          15.8. Subordination. No payments payable by an Indemnitor pursuant
                -------------
     to the terms of this Section 15 shall be paid until all amounts then due
     and payable by the Borrower to the Administrative Agent, the Syndication
     Agent, the Documentation Agent, or any Bank, pursuant to the terms of the
     Credit Documents, are paid in full in cash. Nothing contained in this
     Section 15 shall affect the obligations of any Indemnitor to the
     Administrative Agent, the Syndication Agent, the Documentation Agent, or
     any Bank under the Credit Agreement or any other Credit Documents.

     16.  Miscellaneous. If there shall be more than one Indemnitor hereunder,
          -------------
or pursuant to any other indemnification of Banks relating to Hazardous
Materials arising out of or in connection with the Loan ("Other Indemnitor"),
each Indemnitor and Other Indemnitor agrees that (a) the obligations of the
Indemnitor hereunder, and each Other Indemnitor, are joint and several, (b) a
release of any one or more Indemnitors or Other Indemnitors or any limitation
of this Agreement in favor of or for the benefit of one or more Indemnitors or
Other Indemnitors shall not in any way be deemed a release of or limitation in
favor of or for the benefit of any other Indemnitor or Other Indemnitor and
(c) a separate action hereunder may be brought and

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prosecuted against any or all Indemnitors or Other Indemnitors. If any term of
this Agreement or any application thereof shall be invalid, illegal or
unenforceable, the remainder of this Agreement and any other application of
such term shall not be affected thereby. No delay or omission in exercising
any right hereunder shall operate as a waiver of such right or any other
right. This Agreement shall be binding upon, inure to the benefit of and be
enforceable by Indemnitor and the Banks, and their respective successors and
assigns, including (without limitation) any assignee or purchaser of all or
any portion of the Banks' interest in (i) the Loan, (ii) the Credit Documents,
or (iii) any of the Properties.

     17.  GOVERNING LAW. ANY DISPUTE BETWEEN THE INDEMNITOR, ANY AGENT, ANY
          -------------
BANK, OR ANY INDEMNITEE ARISING OUT OF, CONNECTED WITH, RELATED TO, OR
INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH,
THIS AGREEMENT OR ANY OF THE OTHER CREDIT DOCUMENTS, AND WHETHER ARISING IN
CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE RESOLVED IN ACCORDANCE WITH THE
INTERNAL LAWS (INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW, BUT OTHERWISE WITHOUT REGARD TO THE CONFLICTS OF LAWS
PROVISIONS) OF THE STATE OF NEW YORK.

     18.  CONSENT TO JURISDICTION; SERVICE OF PROCESS; JURY TRIAL.
          -------------------------------------------------------

     (A)  EXCLUSIVE JURISDICTION. EXCEPT AS PROVIDED IN SUBSECTION (B), EACH OF
          ----------------------
THE PARTIES HERETO AGREES THAT ALL DISPUTES AMONG THEM ARISING OUT OF,
CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED
AMONG THEM IN CONNECTION WITH, THIS AGREEMENT OR ANY OF THE OTHER CREDIT
DOCUMENTS WHETHER ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE
RESOLVED EXCLUSIVELY BY STATE OR FEDERAL COURTS LOCATED IN NEW YORK, NEW YORK,
BUT THE PARTIES HERETO ACKNOWLEDGE THAT ANY APPEALS FROM THOSE COURTS MAY HAVE
TO BE HEARD BY A COURT LOCATED OUTSIDE OF NEW YORK, NEW YORK. EACH OF THE
PARTIES HERETO WAIVES IN ALL DISPUTES BROUGHT PURSUANT TO THIS SUBSECTION (A)
                                                               --------------
ANY OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT CONSIDERING THE
DISPUTE.

     (B)  OTHER JURISDICTIONS. THE INDEMNITOR AGREES THAT ANY AGENT, ANY BANK
          -------------------
OR ANY INDEMNITEE SHALL HAVE THE RIGHT TO PROCEED AGAINST THE INDEMNITOR OR
ITS PROPERTY IN A COURT IN ANY LOCATION TO ENABLE SUCH PERSON TO (1) OBTAIN
PERSONAL JURISDICTION OVER THE INDEMNITOR OR (2) ENFORCE A JUDGMENT OR OTHER
COURT ORDER ENTERED IN FAVOR OF SUCH PERSON. THE INDEMNITOR AGREES THAT IT
WILL NOT ASSERT ANY PERMISSIVE COUNTERCLAIMS IN ANY PROCEEDING BROUGHT BY SUCH
PERSON TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF SUCH PERSON. THE
INDEMNITOR WAIVES ANY OBJECTION THAT IT MAY HAVE

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<PAGE>

TO THE LOCATION OF THE COURT IN WHICH SUCH PERSON HAS COMMENCED A PROCEEDING
DESCRIBED IN THIS SUBSECTION (B).
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     (C)  SERVICE OF PROCESS. THE INDEMNITOR WAIVES PERSONAL SERVICE OF ANY
          ------------------
PROCESS UPON IT AND IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OF ANY
WRITS, PROCESS OR SUMMONSES IN ANY SUIT, ACTION OR PROCEEDING BY THE MAILING
THEREOF BY ANY AGENT OR THE BANKS BY REGISTERED OR CERTIFIED MAIL, POSTAGE
PREPAID, TO THE INDEMNITOR ADDRESSED AS PROVIDED HEREIN. NOTHING HEREIN SHALL
IN ANY WAY BE DEEMED TO LIMIT THE ABILITY OF ANY AGENT OR THE BANKS TO SERVE
ANY SUCH WRITS, PROCESS OR SUMMONSES IN ANY OTHER MANNER PERMITTED BY
APPLICABLE LAW. THE INDEMNITOR IRREVOCABLY WAIVES ANY OBJECTION (INCLUDING,
WITHOUT LIMITATION, ANY OBJECTION OF THE LAYING OF VENUE OR BASED ON THE
GROUNDS OF FORUM NON CONVENIENS) WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY SUCH ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH IN ANY JURISDICTION SET FORTH ABOVE.

     (D)  WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES
          --------------------
ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER
SOUNDING IN CONTRACT, TORT, OR OTHERWISE, ARISING OUT OF, CONNECTED WITH,
RELATED TO OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN
CONNECTION WITH THIS AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT
EXECUTED OR DELIVERED IN CONNECTION HEREWITH. EACH OF THE PARTIES HERETO
AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION
SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT ANY PARTY HERETO MAY
FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS AGREEMENT WITH ANY COURT AS
WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR
RIGHT TO TRIAL BY JURY.

     (E)  ADVICE OF COUNSEL. EACH OF THE PARTIES REPRESENTS TO EACH OTHER PARTY
          -----------------
HERETO THAT IT HAS DISCUSSED THIS AGREEMENT AND, SPECIFICALLY, THE PROVISIONS
OF THIS SECTION 18, WITH ITS COUNSEL.

     19.  Amendments/Accession Agreement. No waiver of any provision of this
          ------------------------------
Agreement nor consent to any departure by any Indemnitor therefrom shall be
effective unless the same shall be in writing and signed by the Administrative
Agent and the Required Lenders, and no amendment of this Agreement shall be
effective unless the same shall be in writing and signed by the Administrative
Agent, with the consent of the Required Lenders; provided that any amendment
                                                 --------
or waiver releasing any Indemnitor from any liability hereunder shall be
signed by

                                     -10-
<PAGE>

all the Banks; and provided further that any waiver or consent shall be
                   ----------------
effective only in the specific instance and for the specific purpose for which
given. Notwithstanding the foregoing, in the event that any Subsidiary or
Affiliate of the Borrower hereafter is required in accordance with the terms
of the Credit Agreement or otherwise agrees to become an Indemnitor under this
Agreement, then such Subsidiary or Affiliate may become a party to this
Agreement by executing an Accession Agreement ("Accession Agreement") in the
form attached hereto as Annex 1, and each Indemnitor and the Administrative
Agent hereby agrees that upon such Subsidiary's or Affiliate's execution of
such Accession Agreement, this Agreement shall be deemed to have been amended
to make such Person an Indemnitor hereunder for all purposes and a party
hereto and no signature is required on behalf of the other Indemnitors or the
Administrative Agent to make such an amendment to this Agreement effective.

                             [INTENTIONALLY BLANK]

                                     -11-
<PAGE>

     IN WITNESS WHEREOF, Indemnitor has caused this Agreement to be executed
as of the day and year first written above.

                                      INDEMNITORS:

                                      LASALLE HOTEL OPERATING PARTNERSHIP,
                                      L.P., a Delaware limited partnership

                                      By:   LASALLE HOTEL PROPERTIES, a Maryland
                                            real estate investment trust,
                                            its general partner

                                            By:________________________________
                                            Name:______________________________
                                            Title:_____________________________

                                      Address:  4800 Montgomery Lane, Suite M25
                                                Bethesda, Maryland 20814
                                                Attn:    Mr. Hans S. Weger

           Signature Page of Environmental Indemnification Agreement

                                     -12-
<PAGE>

                                      LASALLE HOTEL PROPERTIES,
                                      a Maryland real estate investment
                                      trust

                                      By:________________________________
                                      Name:______________________________
                                      Title:_____________________________

                                      Address:  4800 Montgomery Lane, Suite M25
                                                Bethesda, Maryland 20814
                                                Attn:  Mr. Hans S. Weger

                                      LHO MISSION BAY HOTEL, L.P.,
                                      a California limited partnership

                                      By:  LaSalle Hotel Operating Partnership,
                                           L.P., a Delaware limited partnership,
                                           its general partner

                                          By:   LaSalle Hotel Properties,
                                                its general partner

                                                By:____________________________
                                                Name:__________________________
                                                Title:_________________________

                                      Address:  4800 Montgomery Lane, Suite M25
                                                Bethesda, Maryland 20814
                                                Attn:   Mr. Hans S. Weger

                                     -13-
<PAGE>

                                      LHO VIKING HOTEL, L.L.C., a Delaware
                                      limited liability company

                                      By:______________________________________
                                      Name:____________________________________
                                      Title:___________________________________

                                      Address:  4800 Montgomery Lane, Suite M25
                                                Bethesda, Maryland 20814
                                                Attn:    Mr. Hans S. Weger

           Signature Page of Environmental Indemnification Agreement

                                     -14-

<PAGE>

                                       I & G CAPITOL, L.L.C.
                                       LHO WASHINGTON HOTEL ONE, L.L.C.
                                       LHO WASHINGTON HOTEL TWO, L.L.C.
                                       LHO WASHINGTON HOTEL THREE, L.L.C.
                                       LHO WASHINGTON HOTEL FOUR, L.L.C.

                                       By:   LaSalle Hotel Operating
                                             Partnership, L.P., a Delaware
                                             limited partnership,
                                             its managing member

                                             By:  LaSalle Hotel Properties,
                                                  its general partner

                                                  By:__________________________
                                                  Name:________________________
                                                  Title:_______________________

                                        Address: 4800 Montgomery Lane, Suite M25
                                                 Bethesda, Maryland 20814
                                                 Attn:   Mr. Hans S. Weger

           Signature Page of Environmental Indemnification Agreement

                                     -15-
<PAGE>

                                       LASALLE HOTEL LESSEE, INC.
                                       LASALLE WASHINGTON ONE LESSEE, INC.
                                       LASALLE WASHINGTON TWO LESSEE, INC.
                                       LASALLE WASHINGTON THREE LESSEE, INC.
                                       LASALLE WASHINGTON FOUR LESSEE, INC.

                                       By:_____________________________________
                                       Name:___________________________________
                                       Title:__________________________________

                                       Address: 4800 Montgomery Lane, Suite M25
                                                Bethesda, Maryland 20814
                                                Attn:    Mr. Hans S. Weger

           Signature Page of Environmental Indemnification Agreement

                                     -16-
<PAGE>

                                       LHO WASHINGTON FIVE LESSEE, L.L.C.

                                       By:  LaSalle Hotel Lessee, Inc.,
                                            its managing member

                                            By:_______________________________
                                            Name:_____________________________
                                            Title:____________________________

                                       Address: 4800 Montgomery Lane, Suite M25
                                                Bethesda, Maryland 20814
                                                Attn:    Mr. Hans S. Weger

           Signature Page of Environmental Indemnification Agreement

           Signature Page of Environmental Indemnification Agreement

                                     -17-
<PAGE>

                                    ANNEX 1
                  to Environmental Indemnification Agreement

                              ACCESSION AGREEMENT

_______________________ [NAME OF ENTITY], a [limited partnership/corporation]
(the "Company"), hereby agrees with (i) SOCIETE GENERALE, SOUTHWEST AGENCY, as
Joint Book Runner and Administrative Agent (the "Administrative Agent") under
the Third Amended and Restated Senior Unsecured Credit Agreement dated as of
June 26, 2001 (the "Credit Agreement") among LASALLE HOTEL OPERATING
PARTNERSHIP, L.P., a Delaware limited partnership, as the Borrower, the
Administrative Agent, BANK OF MONTREAL, CHICAGO BRANCH as Syndication Agent,
DEUTSCHE BANC ALEX. BROWN, as Joint Book Runner and Documentation Agent, and
the Banks; (ii) the parties to the Environmental Indemnity and Agreement (the
"Environmental Indemnity") dated as of June 26, 2001 executed in connection
with the Credit Agreement, (iii) the parties to the Guaranty and Contribution
Agreement (the "Guaranty") dated as of June 26, 2001 executed in connection
with the Credit Agreement, as follows:

     The Company hereby agrees and confirms that, as of the date hereof, it
(a) intends to be a party to the Environmental Indemnity and the Guaranty and
undertakes to perform all the obligations expressed therein, respectively, of
an Indemnitor and a Guarantor (as defined in the Environmental Indemnity and
the Guaranty, respectively), (b) agrees to be bound by all of the provisions
of the Environmental Indemnity and the Guaranty as if it had been an original
party to such agreements, (c) confirms that the representations and warranties
set forth in the Environmental Indemnity and the Guaranty, respectively, with
respect to the Company, a party thereto, are true and correct in all material
respects as of the date of this Accession Agreement and (d) has received and
reviewed copies of each of the Environmental Indemnity and the Guaranty.

     For purposes of notices under the Environmental Indemnity and the
Guaranty the address for the Company is as follows:

        Attention:________________________________________
        Telephone:________________________________________
        Telecopy:_________________________________________

     This Accession Agreement shall be governed by and construed in accordance
with the laws of the State of New York.

     IN WITNESS WHEREOF this Accession Agreement was executed and delivered as
of the ___ day of ___________________, 20___.

                                       [NAME OF ENTITY]

                                       ________________________________________
                                       By:_____________________________________
                                       Title:__________________________________EXHIBIT 10.3

                      GUARANTY AND CONTRIBUTION AGREEMENT

     This Guaranty and Contribution Agreement (this "Agreement") is made and
entered into effective for all purposes as of the 26th day of June, 2001, by
the parties signatory hereto or to an Accession Agreement (as hereinafter
defined) (collectively, the "Guarantor" whether one or more) to and for the
benefit of SOCIETE GENERALE, SOUTHWEST AGENCY, as Joint Book Runner and
Administrative Agent (the "Administrative Agent"), BANK OF MONTREAL, CHICAGO
BRANCH as Syndication Agent (the "Syndication Agent"), DEUTSCHE BANC ALEX.
BROWN, as Joint Book Runner and Documentation Agent ("Documentation Agent"),
and the banks and other lenders named in the Credit Agreement herein
described.

                                 INTRODUCTION

     WHEREAS, this Agreement is given in connection with that certain Third
Amended and Restated Senior Unsecured Credit Agreement dated as of June 26,
2001 ("Credit Agreement"), among LASALLE HOTEL OPERATING PARTNERSHIP, L.P., a
Delaware limited partnership (the "Borrower"), Administrative Agent,
Syndication Agent, Documentation Agent and the banks and other lenders party
thereto (collectively the "Banks");

     WHEREAS, pursuant to the Credit Agreement the Banks are making a loan
(the "Loan") to Borrower as more specifically described therein;

     WHEREAS, the Borrower is the principal financing entity for capital
requirements of its Subsidiaries, and from time to time the Borrower has made
and will continue to make capital contributions and advances to its
Subsidiaries, including the Subsidiaries which are or will become parties
hereto. Other than the Parent, each Guarantor is a direct or indirect
subsidiary of the Borrower. Each Guarantor will derive substantial direct and
indirect benefit from the transactions contemplated by the Credit Agreement;
and

     WHEREAS, the Banks have required the execution and delivery of this
Agreement as a condition precedent to the execution of the Credit Agreement.
The Banks would not be willing to execute the Credit Agreement in the absence
of the execution and delivery by Guarantor of this Agreement.

                                   AGREEMENT
                                   ---------

     NOW, THEREFORE, in order to induce the Banks to make the Advances and the
Issuing Bank to issue its Letters of Credit, each Guarantor hereby agrees as
follows:

     Section 1.   Defined Terms. All terms used in this Agreement, but not
                  -------------
defined herein, shall have the meaning given such terms in the Credit
Agreement.

<PAGE>

     Section 2.   Guaranty.  Each Guarantor hereby unconditionally
                  --------
and irrevocably guarantees the punctual payment when due, whether at stated
maturity, by acceleration or otherwise, of all obligations of the Borrower now
or hereafter existing under the Credit Agreement, the Notes and any other
Credit Document, whether for principal, interest, fees, expenses, or otherwise
(such obligations being the "Guaranteed Obligations") and any and all expenses
(including reasonable counsel fees and expenses) incurred by the
Administrative Agent, the Syndication Agent, the Documentation Agent, or any
Bank in enforcing any rights under this Agreement. Each Guarantor agrees that
its guaranty obligation under this Agreement is a guarantee of payment, not of
collection and that such Guarantor is primarily liable for the payment of the
Guaranteed Obligations.

     Section 3.   Limit of Liability. Each Guarantor that is a
                  ------------------
Subsidiary of the Borrower shall be liable under this Agreement with respect
to the Guaranteed Obligations only for amounts aggregating up to the largest
amount that would not render its guaranty obligation hereunder subject to
avoidance under Section 548 of the United States Bankruptcy Code or any
comparable provisions of any state law.

     Section 4.   Guaranty Absolute. Each Guarantor guarantees that the
                  -----------------
Guaranteed Obligations will be paid and performed strictly in accordance with
the terms of the Credit Agreement, the other Credit Documents and the
Participating Leases, as applicable, regardless of any law, regulation, or
order now or hereafter in effect in any jurisdiction affecting any of such
terms or the rights of the Administrative Agent, the Syndication Agent, the
Documentation Agent, the Banks or the Participating Lessees with respect
thereto. The liability of each Guarantor under this Agreement shall be
absolute and unconditional irrespective of:

     (a)  any lack of validity or enforceability of the Credit Agreement, any
other Credit Document, any Participating Lease or any other agreement or
instrument relating thereto;

     (b)  any change in the time, manner, or place of payment of, or in
any other term of, any of the Guaranteed Obligations, or any other amendment
or waiver of or any consent to departure from the Credit Agreement, any Credit
Document or any Participating Lease;

     (c)  any exchange, release, or nonperfection of any collateral, if
applicable, or any release or amendment or waiver of or consent to departure
from any other agreement or guaranty, for any of the Guaranteed Obligations;
or

     (d)  any other circumstances which might otherwise constitute a defense
available to, or a discharge of the Borrower or a Guarantor.

     Section 5.   Continuation and Reinstatement, Etc. Each Guarantor
                  -----------------------------------
agrees that, to the extent that the Borrower makes payments to the
Administrative Agent, the Syndication Agent, the Documentation Agent or any
Bank or the Administrative Agent, the Syndication Agent, the Documentation
Agent or any Bank receives any proceeds of any property of Borrower or any
Guarantor and such payments or proceeds or any part thereof are subsequently
invalidated,

                                      -2-
<PAGE>

declared to be fraudulent or preferential, set aside, or otherwise required to
be repaid, then to the extent of such repayment the Guaranteed Obligations
shall be reinstated and continued in full force and effect as of the date such
initial payment or collection of proceeds occurred. The Guarantor shall defend
and indemnify the Administrative Agent, the Syndication Agent, the
Documentation Agent and each Bank from and against any claim or loss under
this Section 5 (including reasonable attorneys' fees and expenses) in the
defense of any such action or suit.

     Section 6.   Certain Waivers.
                  ---------------

     6.01 Notice. Each Guarantor hereby waives promptness, diligence, notice
          ------
of acceptance, notice of acceleration, notice of intent to accelerate and any
other notice with respect to any of the Guaranteed Obligations and this
Agreement.

     6.02 Other Remedies. Each Guarantor hereby waives any requirement
          --------------
that the Administrative Agent, the Syndication Agent, the Documentation Agent
or any Bank protect, secure, perfect, or insure any Lien or any Property
subject thereto or exhaust any right or take any action against the Borrower
or any other Person or any collateral, if any, including any action required
pursuant to a Legal Requirement.

     6.03 Waiver of Subrogation.
          ---------------------

     (a)  Each Guarantor hereby irrevocably waives, until payment in
full of all Guaranteed Obligations and termination of all Commitments, any
claim or other rights which it may acquire against the Borrower that arise
from such Guarantor's obligations under this Agreement or any other Credit
Document, including, without limitation, any right of subrogation (including,
without limitation, any statutory rights of subrogation under Section 509 of
the Bankruptcy Code, 11 U.S.C. ss.509, or otherwise), reimbursement,
exoneration, contribution, indemnification, or any right to participate in any
claim or remedy of the Administrative Agent, the Syndication Agent, the
Documentation Agent or any Bank against the Borrower or any collateral which
the Administrative Agent, the Syndication Agent, the Documentation Agent or
any Bank now has or acquires. If any amount shall be paid to any Guarantor in
violation of the preceding sentence and the Guaranteed Obligations shall not
have been paid in full and all of the Commitments terminated, such amount
shall be held in trust for the benefit of the Administrative Agent, the
Syndication Agent, the Documentation Agent or any Bank and shall promptly be
paid to the Administrative Agent for the benefit of Administrative Agent, the
Syndication Agent, the Documentation Agent and the Banks to be applied to the
Guaranteed Obligations, whether matured or unmatured, as the Administrative
Agent may elect. Each Guarantor acknowledges that it will receive direct and
indirect benefits from the financing arrangements contemplated by the Credit
Agreement and that the waiver set forth in this Section 6.03(a) is knowingly
made in contemplation of such benefits.

     (b)  Each Guarantor further agrees that it will not enter into any
agreement providing, directly or indirectly, for any contribution,
reimbursement, repayment, or indemnity by the Borrower or any other Person on
account of any payment by such Guarantor to the

                                      -3-
<PAGE>

Administrative Agent, the Syndication Agent, the Documentation Agent or the
Banks under this Agreement.

     Section 7.   Representations and Warranties. Each Guarantor hereby
                  ------------------------------
represents and warrants as follows:

     7.01 Corporate Authority. Such Guarantor is either a corporation,
          -------------------
limited liability company, limited partnership or trust duly organized,
validly existing and in good standing under the laws of the jurisdiction of
its organization. The execution, delivery and performance by such Guarantor of
this Agreement are within such Guarantor's organizational powers, have been
duly authorized by all necessary organizational action and do not contravene
(a) such Guarantor's organizational authority or (b) any law or material
contractual restriction affecting such Guarantor or its Property.

     7.02 Government Approval. No authorization or approval or other action by
          -------------------
and no notice to or filing with, any Governmental Authority is required for
the due execution, delivery and performance by such Guarantor of this
Agreement.

     7.03 Binding Obligations. This Agreement is the legal, valid and
          -------------------
binding obligation of such Guarantor enforceable against such Guarantor in
accordance with its terms subject to the effect of any applicable bankruptcy,
insolvency, reorganization, moratorium, or similar law affecting
creditors' rights (whether considered in a proceeding at law or in equity).

     Section 8.   Covenants. Each Guarantor will comply with all covenant
                  ---------
provisions of Article V and Article VI of the Credit Agreement to the extent
such provisions are applicable.

     8.01 Additional Covenant. As soon as possible and in any event
          -------------------
within five days after the incurrence of any Indebtedness by the Parent or any
Subsidiary of the Parent other than the Obligations or any other Indebtedness
permitted under the Credit Agreement, the Parent shall notify the
Administrative Agent in writing of such incurrence.

     Section 9.   Contribution. As a result of the transactions
                  ------------
contemplated by the Credit Agreement, each of the Guarantors will benefit,
directly and indirectly, from the Guaranteed Obligations and in consideration
thereof desire to enter into a contribution agreement among themselves as set
forth in this Section 9 to allocate such benefits among themselves and to
provide a fair and equitable arrangement to make contributions in the event
any payment is made by any Guarantor hereunder to the Administrative Agent,
the Syndication Agent, the Documentation Agent or the Banks (such payment
being referred to herein as a "Contribution," and for purposes of this
Agreement, includes any exercise of recourse by the Administrative Agent
against any Property of a Guarantor and application of proceeds of such
Property in satisfaction of such Guarantor's obligations under this
Agreement). The Guarantors hereby agree as follows:

                                      -4-
<PAGE>

     9.01 Calculation of Contribution. In order to provide for just and
          ---------------------------
equitable contribution among the Guarantors in the event any Contribution is
made by a Guarantor (a "Funding Guarantor"), such Funding Guarantor shall be
entitled to a contribution from certain other Guarantors for all payments,
damages and expenses incurred by that Funding Guarantor in discharging any of
the Guaranteed Obligations, in the manner and to the extent set forth in this
Section. The amount of any Contribution under this Agreement shall be equal to
the payment made by the Funding Guarantor to the Administrative Agent or any
other beneficiary pursuant to this Agreement and shall be determined as of the
date on which such payment is made.

     9.02 Benefit Amount Defined. For purposes of this Agreement, the
          ----------------------
"Benefit Amount" of any Guarantor as of any date of determination shall be the
net value of the benefits to such Guarantor and all of its Subsidiaries
(including any Subsidiaries which may be Guarantors) from extensions of credit
made by the Banks to the Borrower under the Credit Agreement and the benefit
of entering into the Participating Leases; provided, that in determining the
contribution liability of any Guarantor which is a Subsidiary to its direct or
indirect parent corporation or of any Guarantor to its direct or indirect
Subsidiary, the Benefit Amount of such Subsidiary and its Subsidiaries, if
any, shall be subtracted in determining the Benefit Amount of the parent
corporation. Such benefits shall include benefits of funds constituting
proceeds of Advances made to the Borrower by the Banks which are in turn
advanced or contributed by the Borrower to such Guarantor or its Subsidiaries
and benefits of Letters of Credit issued pursuant to the Credit Agreement on
behalf of, or the proceeds of which are advanced or contributed or otherwise
benefit, directly or indirectly, such Guarantor and its Subsidiaries
(collectively, the "Benefits"). In the case of any proceeds of Advances or
Benefits advanced or contributed to a Person (an "Owned Entity") any of the
equity interests of which are owned directly or indirectly by a Guarantor, the
Benefit Amount of a Guarantor with respect thereto shall be that portion of
the net value of the benefits attributable to Advances or Benefits equal to
the direct or indirect percentage ownership of such Guarantor in its Owned
Entity.

     9.03 Contribution Obligation. Each Guarantor shall be liable to a
          -----------------------
Funding Guarantor in an amount equal to the greater of (A) the (i) ratio of
the Benefit Amount of such Guarantor to the total amount of Guaranteed
Obligations, multiplied by (ii) the amount of Guaranteed Obligations paid by
such Funding Guarantor and (B) 95% of the excess of the fair saleable value of
the property of such Guarantor over the total liabilities of such Guarantor
(including the maximum amount reasonably expected to become due in respect of
contingent liabilities) determined as of the date on which the payment made by
a Funding Guarantor is deemed made for purposes of this Agreement (giving
effect to all payments made by other Funding Guarantors as of such date in a
manner to maximize the amount of such contributions).

     9.04 Allocation. In the event that at any time there exists more
          ----------
than one Funding Guarantor with respect to any Contribution (in any such case,
the "Applicable Contribution"), then payment from other Guarantors pursuant to
this Agreement shall be allocated among such Funding Guarantors in proportion
to the total amount of the Contribution made for or on account of the Borrower
by each such Funding Guarantor pursuant to the Applicable Contribution. In the

                                      -5-
<PAGE>

event that at any time any Guarantor pays an amount under this Agreement in
excess of the amount calculated pursuant to clause (A) of Subsection 9.03
above, that Guarantor shall be deemed to be a Funding Guarantor to the extent
of such excess and shall be entitled to contribution from the other Guarantors
in accordance with the provisions of this Section.

     9.05 Subsidiary Payment. The amount of contribution payable under this
          ------------------
Section by any Guarantor shall be reduced by the amount of any contribution
paid hereunder by a Subsidiary of such Guarantor.

     9.06 Equitable Allocation. If as a result of any reorganization,
          --------------------
recapitalization, or other corporate change in the Borrower or any of its
Subsidiaries, or as a result of any amendment, waiver or modification of the
terms and conditions of other Sections of this Agreement or the Guaranteed
Obligations, or for any other reason, the contributions under this Section
become inequitable as among the Guarantors, the Guarantors shall promptly
modify and amend this Section to provide for an equitable allocation of
contributions. Any of the foregoing modifications and amendments shall be in
writing and signed by all Guarantors.

     9.07 Asset of Party to Which Contribution is Owing. The Guarantors
          ---------------------------------------------
acknowledge that the right to contribution hereunder shall constitute an asset
in favor of the Guarantor to which such contribution is owing.

     9.08 Subordination. No payments payable by a Guarantor pursuant to
          -------------
the terms of this Section 9 shall be paid until all amounts then due and
payable by the Borrower to any Bank, pursuant to the terms of the Credit
Documents, are paid in full in cash. Nothing contained in this Section 9 shall
affect the obligations of any Guarantor to any Bank under the Credit Agreement
or any other Credit Documents.

     Section 10.   Miscellaneous.
                   -------------

     10.01 Addresses for Notices. All notices and other communications
           ---------------------
provided for hereunder shall be in writing, including telegraphic
communication and delivered or teletransmitted to the Administrative Agent, as
set forth in the Credit Agreement and to each Guarantor, at the address set
forth under such Guarantor's signature hereto or in the Accession Agreement
executed by such Guarantor, or to such other address as shall be designated by
any Guarantor or the Administrative Agent in written notice to the other
parties. All such notices and other communications shall be effective when
delivered or teletransmitted to the above addresses.

     10.02 Amendments, Etc. No waiver of any provision of this Agreement
           ---------------
nor consent to any departure by any Guarantor therefrom shall be effective
unless the same shall be in writing and signed by the Administrative Agent,
the Required Lenders and the Borrower and no amendment of this Agreement shall
be effective unless the same shall be in writing and signed by each Guarantor
and the Administrative Agent, with the consent of the Required Lenders;
provided that any amendment or waiver releasing any Guarantor from any
liability hereunder

                                      -6-
<PAGE>

shall be signed by all the Banks; and provided further that any waiver or
                                      ----------------
consent shall be effective only in the specific instance and for the specific
purpose for which given. Notwithstanding the foregoing, in the event that any
Subsidiary or Affiliate of the Borrower hereafter is required in accordance
with the terms of the Credit Agreement or otherwise agrees to become a
guarantor of the Borrower's obligations under the Credit Documents, then such
Subsidiary or Affiliate may become a party to this Agreement by executing an
Accession Agreement ("Accession Agreement") in the form attached hereto as
Annex 1 and each Guarantor and the Administrative Agent hereby agrees that
-------
upon such Subsidiary's or Affiliate's execution of such Accession Agreement,
this Agreement shall be deemed to have been amended to make such Person a
Guarantor hereunder for all purposes and a party hereto and no signature is
required on behalf of the other Guarantors or the Administrative Agent to make
such an amendment to this Agreement effective.

     10.03 No Waiver; Remedies. No failure on the part of Administrative
           -------------------
Agent, the Syndication Agent, the Documentation Agent or any Bank to exercise,
and no delay in exercising, any right hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.

     10.04 Right of Set-Off. Upon the occurrence and during the
           ----------------
continuance of any Event of Default, the Administrative Agent, the Syndication
Agent, the Documentation Agent and the Banks are hereby authorized at any
time, to the fullest extent permitted by law, to set off and apply any
deposits (general or special, time or demand, provisional or final) and other
indebtedness owing by the Administrative Agent, the Syndication Agent, the
Documentation Agent or the Banks to the account of any Guarantor against any
and all of the obligations of such Guarantor under this Agreement,
irrespective of whether or not the Administrative Agent, the Syndication
Agent, the Documentation Agent or the Banks shall have made any demand under
this Agreement and although such obligations may be contingent and unmatured.
The Administrative Agent, the Syndication Agent, the Documentation Agent and
the Banks agree promptly to notify each Guarantor affected by any such set-off
after any such set-off and application made by the Administrative Agent, the
Syndication Agent, the Documentation Agent or the Banks provided that the
failure to give such notice shall not affect the validity of such set-off and
application. The rights of the Administrative Agent, the Syndication Agent,
the Documentation Agent and the Banks under this Section 10.04 are in addition
to other rights and remedies (including, without limitation, other rights of
set-off) which the Administrative Agent, the Syndication Agent, the
Documentation Agent and the Banks may have.

     10.05 Continuing Guaranty; Transfer of Interest. This Agreement
           -----------------------------------------
shall create a continuing guaranty and shall (a) remain in full force and
effect until payment in full and termination of the Guaranteed Obligations,
(b) be binding upon each Guarantor, its successors and assigns, and (c) inure,
together with the rights and remedies of the Administrative Agent hereunder,
to the benefit of the Administrative Agent, the Syndication Agent, the
Documentation

                                      -7-
<PAGE>

Agent and the Banks and their respective successors, transferees and assigns.
Without limiting the generality of the foregoing clause, when any Bank assigns
or otherwise transfers any interest held by it under the Credit Agreement or
other Credit Document to any other Person pursuant to the terms of the Credit
Agreement or other Credit Document, that other Person shall thereupon become
vested with all the benefits held by such Bank under this Agreement. Upon the
payment in full and termination of the Guaranteed Obligations, the guaranties
granted hereby shall terminate and all rights hereunder shall revert to each
Guarantor to the extent such rights have not been applied pursuant to the
terms hereof. Upon any such termination, the Administrative Agent will, at
each Guarantor's expense, execute and deliver to such Guarantor such documents
as such Guarantor shall reasonably request and take any other actions
reasonably requested to evidence or effect such termination.

     10.06 GOVERNING LAW. ANY DISPUTE BETWEEN THE GUARANTOR, ANY AGENT,
           -------------
ANY BANK, OR ANY INDEMNITEE ARISING OUT OF, CONNECTED WITH, RELATED TO, OR
INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH,
THIS AGREEMENT OR ANY OF THE OTHER CREDIT DOCUMENTS, AND WHETHER ARISING IN
CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE RESOLVED IN ACCORDANCE WITH THE
INTERNAL LAWS (INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW, BUT OTHERWISE WITHOUT REGARD TO THE CONFLICTS OF LAWS
PROVISIONS) OF THE STATE OF NEW YORK.

     10.07 CONSENT TO JURISDICTION; SERVICE OF PROCESS; JURY TRIAL.
           -------------------------------------------------------

     (A)  EXCLUSIVE JURISDICTION. EXCEPT AS PROVIDED IN SUBSECTION (B),
          ----------------------                        --------------
EACH OF THE PARTIES HERETO AGREES THAT ALL DISPUTES AMONG THEM ARISING OUT OF,
CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED
AMONG THEM IN CONNECTION WITH, THIS AGREEMENT OR ANY OF THE OTHER CREDIT
DOCUMENTS WHETHER ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE, SHALL BE
RESOLVED EXCLUSIVELY BY STATE OR FEDERAL COURTS LOCATED IN NEW YORK, NEW YORK,
BUT THE PARTIES HERETO ACKNOWLEDGE THAT ANY APPEALS FROM THOSE COURTS MAY HAVE
TO BE HEARD BY A COURT LOCATED OUTSIDE OF NEW YORK, NEW YORK. EACH OF THE
PARTIES HERETO WAIVES IN ALL DISPUTES BROUGHT PURSUANT TO THIS SUBSECTION (A)
                                                               --------------
ANY OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT CONSIDERING THE
DISPUTE.

     (B)  OTHER JURISDICTIONS. THE GUARANTOR AGREES THAT ANY AGENT, ANY
          -------------------
BANK OR ANY INDEMNITEE SHALL HAVE THE RIGHT TO PROCEED AGAINST THE GUARANTOR
OR ITS PROPERTY IN A COURT IN ANY LOCATION TO ENABLE SUCH PERSON TO (1) OBTAIN
PERSONAL JURISDICTION OVER THE GUARANTOR OR (2) ENFORCE A JUDGMENT OR OTHER
COURT ORDER ENTERED IN FAVOR OF SUCH PERSON. THE GUARANTOR AGREES THAT IT WILL
NOT

                                      -8-
<PAGE>

ASSERT ANY PERMISSIVE COUNTERCLAIMS IN ANY PROCEEDING BROUGHT BY SUCH PERSON
TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF SUCH PERSON. THE
GUARANTOR WAIVES ANY OBJECTION THAT IT MAY HAVE TO THE LOCATION OF THE COURT
IN WHICH SUCH PERSON HAS COMMENCED A PROCEEDING DESCRIBED IN THIS
SUBSECTION (B).
--------------

     (C)  SERVICE OF PROCESS. THE GUARANTOR WAIVES PERSONAL SERVICE OF
          ------------------
ANY PROCESS UPON IT AND IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OF ANY
WRITS, PROCESS OR SUMMONSES IN ANY SUIT, ACTION OR PROCEEDING BY THE MAILING
THEREOF BY ANY AGENT OR THE BANKS BY REGISTERED OR CERTIFIED MAIL, POSTAGE
PREPAID, TO THE GUARANTOR ADDRESSED AS PROVIDED HEREIN. NOTHING HEREIN SHALL
IN ANY WAY BE DEEMED TO LIMIT THE ABILITY OF ANY AGENT OR THE BANKS TO SERVE
ANY SUCH WRITS, PROCESS OR SUMMONSES IN ANY OTHER MANNER PERMITTED BY
APPLICABLE LAW. THE GUARANTOR IRREVOCABLY WAIVES ANY OBJECTION (INCLUDING,
WITHOUT LIMITATION, ANY OBJECTION OF THE LAYING OF VENUE OR BASED ON THE
GROUNDS OF FORUM NON CONVENIENS) WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
           ----- --- ----------
BRINGING OF ANY SUCH ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN
CONNECTION HEREWITH IN ANY JURISDICTION SET FORTH ABOVE.

     (D)  WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO IRREVOCABLY
          --------------------
WAIVES ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER
SOUNDING IN CONTRACT, TORT, OR OTHERWISE, ARISING OUT OF, CONNECTED WITH,
RELATED TO OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN
CONNECTION WITH THIS AGREEMENT OR ANY OTHER INSTRUMENT, DOCUMENT OR AGREEMENT
EXECUTED OR DELIVERED IN CONNECTION HEREWITH. EACH OF THE PARTIES HERETO
AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION
SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT ANY PARTY HERETO MAY
FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS AGREEMENT WITH ANY COURT AS
WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF THEIR
RIGHT TO TRIAL BY JURY.

     (E)  ADVICE OF COUNSEL. EACH OF THE PARTIES REPRESENTS TO EACH
          -----------------
OTHER PARTY HERETO THAT IT HAS DISCUSSED THIS AGREEMENT AND, SPECIFICALLY, THE
PROVISIONS OF THIS SECTION 10.08, WITH ITS COUNSEL.
                   -------------

                             [INTENTIONALLY BLANK]

                                      -9-
<PAGE>

     Each Guarantor has caused this Agreement to be duly executed as of the
date first above written.

                                      GUARANTORS:

                                      LASALLE HOTEL PROPERTIES, a Maryland real
                                      estate investment trust

                                      By:______________________________________
                                      Name:____________________________________
                                      Title:___________________________________

                                      Address:  4800 Montgomery Lane, Suite M25
                                                Bethesda, Maryland 20814
                                                Attn:    Mr. Hans S. Weger

                                      LHO MISSION BAY HOTEL, L.P.,
                                      a California limited partnership

                                      By:  LaSalle Hotel Operating Partnership,
                                           L.P., a Delaware limited
                                           partnership, its general partner

                                           By:  LaSalle Hotel Properties,
                                                its general partner

                                                By:____________________________
                                                Name:__________________________
                                                Title:_________________________

                                      Address:  4800 Montgomery Lane, Suite M25
                                                Bethesda, Maryland 20814
                                                Attn:    Mr. Hans S. Weger

                                     -10-
<PAGE>

             Signature Page of Guaranty and Contribution Agreement

                                      -11-
<PAGE>

                                      LHO VIKING HOTEL, L.L.C.,
                                      a Delaware limited liability company

                                      By:______________________________________
                                      Name:____________________________________
                                      Title:___________________________________

                                      Address: 4800 Montgomery Lane, Suite M25
                                               Bethesda, Maryland 20814
                                               Attn:    Mr. Hans S. Weger

             Signature Page of Guaranty and Contribution Agreement

                                      -12-
<PAGE>

                                      I & G CAPITOL, L.L.C.
                                      LHO WASHINGTON HOTEL ONE, L.L.C.
                                      LHO WASHINGTON HOTEL TWO, L.L.C.
                                      LHO WASHINGTON HOTEL THREE, L.L.C.
                                      LHO WASHINGTON HOTEL FOUR, L.L.C.

                                      By:  LaSalle Hotel Operating Partnership,
                                           L.P., a Delaware limited partnership,
                                           its managing member

                                           By:  LaSalle Hotel Properties,
                                                its general partner

                                                By:____________________________
                                                Name:__________________________
                                                Title:_________________________

                                      Address:  4800 Montgomery Lane, Suite M25
                                                Bethesda, Maryland 20814
                                                Attn:    Mr. Hans S. Weger

             Signature Page of Guaranty and Contribution Agreement

                                      -13-
<PAGE>

                                      LASALLE HOTEL LESSEE, INC.
                                      LASALLE WASHINGTON ONE LESSEE, INC.
                                      LASALLE WASHINGTON TWO LESSEE, INC.
                                      LASALLE WASHINGTON THREE LESSEE, INC.
                                      LASALLE WASHINGTON FOUR LESSEE, INC.

                                      By:______________________________________
                                      Name:____________________________________
                                      Title:___________________________________

                                      Address:  4800 Montgomery Lane, Suite M25
                                                Bethesda, Maryland 20814
                                                Attn:    Mr. Hans S. Weger

             Signature Page of Guaranty and Contribution Agreement

                                      -14-
<PAGE>

                                      LHO WASHINGTON FIVE LESSEE, L.L.C.

                                      By:  LaSalle Hotel Lessee, Inc.,
                                           its managing member

                                           By:_________________________________
                                           Name:_______________________________
                                           Title:______________________________

                                      Address:  4800 Montgomery Lane, Suite M25
                                                Bethesda, Maryland 20814
                                                Attn:    Mr. Hans S. Weger

             Signature Page of Guaranty and Contribution Agreement

                                     -15-
<PAGE>

                                    ANNEX 1
                      Guaranty and Contribution Agreement

                              ACCESSION AGREEMENT

_______________________ [NAME OF ENTITY], a [limited partnership/corporation]
(the "Company"), hereby agrees with (i) SOCIETE GENERALE, SOUTHWEST AGENCY, as
Administrative Agent (the "Administrative Agent") under the Third Amended and
Restated Senior Unsecured Credit Agreement dated as of June 26, 2001 (the
"Credit Agreement") among LASALLE HOTEL OPERATING PARTNERSHIP, L.P., a
Delaware limited partnership, as the Borrower, the Administrative Agent, BANK
OF MONTREAL, CHICAGO BRANCH as Syndication Agent, DEUTSCHE BANC ALEX. BROWN,
as Joint Book Runner and Documentation Agent, and the Banks; (ii) the parties
to the Environmental Indemnity Agreement (the "Environmental Indemnity") dated
as of June 26, 2001 executed in connection with the Credit Agreement, (iii)
the parties to the Guaranty and Contribution Agreement (the "Guaranty") dated
as of June 26, 2001 executed in connection with the Credit Agreement, as
follows:

     The Company hereby agrees and confirms that, as of the date hereof, it
(a) intends to be a party to the Environmental Indemnity and the Guaranty and
undertakes to perform all the obligations expressed therein, respectively, of
an Indemnitor and a Guarantor (as defined in the Environmental Indemnity and
the Guaranty, respectively), (b) agrees to be bound by all of the provisions
of the Environmental Indemnity and the Guaranty as if it had been an original
party to such agreements, (c) confirms that the representations and warranties
set forth in the Environmental Indemnity and the Guaranty, respectively, with
respect to the Company, a party thereto, are true and correct in all material
respects as of the date of this Accession Agreement and (d) has received and
reviewed copies of each of the Environmental Indemnity and the Guaranty.

     For purposes of notices under the Environmental Indemnity and the
Guaranty the address for the Company is as follows:

         Attention:___________________________________
         Telephone:___________________________________
         Telecopy:____________________________________

     This Accession Agreement shall be governed by and construed in accordance
with the laws of the State of New York.

     IN WITNESS WHEREOF this Accession Agreement was executed and delivered as
of the ___ day of __________________, _____.

                                      [NAME OF ENTITY]

                                      _________________________________________
                                      By:______________________________________
                                      Title:___________________________________

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