Document:

CLDT-EX10.1PSA_2014.05.08

Exhibit 10.1

PURCHASE AND SALE AGREEMENT 
 
 
by and among 
 
 
THE ENTITIES SET FORTH ON SCHEDULE A ATTACHED HERETO, 
 
    collectively, SELLERS, 
 
CHATHAM LODGING, L.P.,  
solely for purposes of Section 2(a) hereof, 
 
THE INDIVIDUAL OWNERS AND OPERATING LESSEES LISTED ON THE SIGNATURE PAGES HERETO, 
solely for purposes of Section 43 hereof 
 
and 
 
NEWINK, LLC, 
 
    PURCHASER. 
 
 
 
 
Premises:  THE PROPERTIES SET FORTH ON SCHEDULE B ATTACHED HERETO
Dated as of May 8, 2014

	
			
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	TABLE OF CONTENTS

	 
	 
	Page

	1
	

	DEFINITIONS
	2

	2
	

	PURCHASE AND SALE.
	6

	3
	

	DUE DILIGENCE PERIOD; ACCESS; RIGHTS OF INSPECTION AND CONFIDENTIALITY.
	11

	4
	

	PURCHASE PRICE AND DEPOSIT.
	15

	5
	

	STATUS OF TITLE.
	20

	6
	

	TITLE INSURANCE; LIENS.
	21

	7
	

	APPORTIONMENTS.
	25

	8
	

	PROPERTY NOT INCLUDED IN SALE.
	30

	9
	

	COVENANTS OF SELLER AND PURCHASER.
	30

	10
	

	TRANSFER; SECURITY DEPOSITS; CONDITIONS TO CLOSING.
	35

	11
	

	CONDITION OF THE PROPERTY; REPRESENTATIONS.
	37

	12
	

	DAMAGE AND DESTRUCTION.
	53

	13
	

	CONDEMNATION.
	54

	14
	

	BROKERS AND ADVISORS.
	55

	15
	

	TAX REDUCTION PROCEEDINGS.
	56

	16
	

	TRANSFER TAXES; SALES TAXES; AND TRANSACTION COSTS.
	57

	17
	

	DELIVERIES TO BE MADE ON THE CLOSING DATE.
	58

	18
	

	CLOSING DATE.
	60

	19
	

	NOTICES.
	60

	20
	

	DEFAULT BY PURCHASER OR SELLER.
	62

	21
	

	FIRPTA COMPLIANCE.
	66

	22
	

	ENTIRE AGREEMENT; ACCEPTANCE OF JV ASSIGNMENTS.
	66

	23
	

	AMENDMENTS.
	67

	24
	

	WAIVER.
	67

	25
	

	PARTIAL INVALIDITY.
	67

	26
	

	SECTION HEADINGS.
	67

	27
	

	GOVERNING LAW.
	67

	28
	

	PARTIES; ASSIGNMENT AND RECORDING.
	68

	29
	

	CONFIDENTIALITY AND PRESS RELEASES.
	69

	30
	

	FURTHER ASSURANCES.
	71

	31
	

	THIRD PARTY BENEFICIARY.
	71

	32
	

	JURISDICTION AND SERVICE OF PROCESS.
	71

	33
	

	WAIVER OF TRIAL BY JURY.
	71

	34
	

	ATTORNEYS' FEES.
	71

	35
	

	EXCULPATION.
	72

	36
	

	RIGHT OF FIRST OFFER.
	73

	37
	

	INTENTIONALLY OMITTED.
	74

	38
	

	HOTEL EMPLOYEES.
	74

	39
	

	BOOKINGS AND INFORMATION.
	76

	40
	

	AFFECTED PROPERTIES; AFFECTED INDIVIDUAL PROPERTIES.
	78

	
			
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	41
	

	MISCELLANEOUS.
	78

	42
	

	TAX MATTERS.
	80

	43
	

	INDIVIDUAL OWNERS AND OPERATING LESSEES JOINDER
	80

	
			
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	Schedules

	 
	 

	A.
	Seller Entities

	B.
	List of Properties

	B-1.
	Purchase Price Allocation

	B-2
	Percentage Interest in Transferred Entity

	C.
	List of Franchise Agreements

	C-1
	List of Franchise Agreement Defaults

	D.
	List of Leases

	D-1
	List of Prepaid Rent

	E.
	Section 2(a)(2) Definitions

	F.
	Pending Condemnation Proceedings

	G.
	List of Litigation

	H-1.
	Mezz A Borrowers

	H-2.
	Mezz B Borrowers

	H-3.
	Mezz C Borrowers

	I.
	Current Structure Chart

	J.
	Purchase Price

	K.
	Insurance Certificates

	L.
	Financials

	M.
	Judgments

	N.
	Operating Leases

	O.
	Intentionally Omitted

	P.
	Hotel Employees

	Q.
	Transfers Taxes and Title Fees

	 
	 

	Exhibits
	 

	1
	

	Escrow Agent's Wire Instructions

	2
	

	Form of FIRPTA Affidavit

	3
	

	Form of Assignment and Assumption Agreement

	4
	

	Form of Ground Lease Estoppel Certificate

	
			
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THIS PURCHASE AND SALE AGREEMENT (this "Agreement") made as of the 8th day of May, 2014 (the "Effective Date"), by and among (i) THE ENTITIES SET FORTH ON SCHEDULE A ATTACHED HERETO (individually, a "Seller" or collectively, the "Sellers"), jointly and severally, having an address c/o Cerberus Real Estate Capital Management, LLC, 875 Third Avenue, 12th Floor, New York, New York 10022, (ii) CHATHAM LODGING, L.P., solely for purposes of Section 2(a) hereof, (iii) NewINK, LLC, a Delaware limited liability company, having an address at c/o NorthStar Realty Finance Corp., 399 Park Avenue, 18th Floor,  New York, New York 10022 ("Purchaser") and (iv) the INDIVIDUAL OWNERS AND OPERATING LESSEES, solely for purposes of Section 43 hereof. Sellers and Purchaser may hereinafter be referred to individually as a "Party" and collectively as the "Parties".
W I T N E S S E T H :
WHEREAS, Sellers are the owners of a Percentage Interest (as hereinafter defined) (the "Transferred Interests") in INK Acquisition LLC, INK Acquisition III LLC, INK Acquisition IV LLC, INK Acquisition V LLC, INK Acquisition VI LLC, and INK Acquisition VII LLC, as applicable (each, a "Transferred Entity" and, collectively, the "Transferred Entities") as described on the structure chart attached hereto as Schedule I (the "Current Structure Chart") pursuant to the operating agreements of the Transferred Entities (the "Operating Agreements"). For purposes of this Agreement, the term "Percentage Interest" shall have the meaning set forth in the applicable Operating Agreements;
WHEREAS, each Transferred Entity owns one hundred percent (100%) of the direct or indirect ownership and  other interests (the "JV Interests") in certain entities (each, a "JV Entity" and, collectively, the "JV Entities"), as shown on the Current Structure Chart,  including, without limitation, the entities that hold fee title or ground leasehold, as applicable, interests in the Properties (as hereinafter defined) (each, an "Individual Owner" and, collectively, the "Individual Owners") and in the case of Ink Acquisition III LLC, the operating tenants (individually, an "Operating Lessee" and collectively, the "Operating Lessees") with rights to the Properties;
WHEREAS, each Individual Owner is the owner and holder of the fee simple estate (or in the case of the Individual Property (as hereinafter defined) located in Fort Lauderdale, Florida, the leasehold estate) in and to each plot, piece and parcel of land (individually, the "Individual Land" and collectively, the "Land") more commonly known by the address as set forth next to its name, and legally described, on Schedule B attached hereto, together with the buildings and all other improvements (individually, a "Building" and collectively, the "Buildings") located on the Individual Land owned by the Individual Owner (the Buildings and the Land being sometimes collectively referred to hereinafter as the "Premises" and each Individual Land with the Building or Buildings located thereon, an "Individual Premises"); and
WHEREAS, Sellers desire to sell the Transferred Interests to Purchaser, and Purchaser desires to purchase the Transferred Interests (as set forth in the terms and provisions of the Operating Agreements) from Sellers, upon and subject to  the terms and conditions of this Agreement.

	
			
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NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements herein contained, the Parties hereto covenant and agree as follows:

	
			
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	1.
	DEFINITIONS

	
		
	Accounts Receivable
	Section 7(c)(ii)

	Additional Deposit
	Section 4(a)(ii)

	Additional Rent
	Section 7(b)(ii)

	Adjourned Closing Date
	Section 6(a)(v)

	Affected Individual Property
	Section 6(b)

	Affected Property
	Section 13(a)(ii)

	Affiliate
	Section 11(h)(ix)

	Agreement
	Preamble

	Allocated Purchase Price
	Section 4(a)

	Anti-Money Laundering Laws
	Section 11(h)(vi)

	Asbestos
	Section 11(i)

	Assigned Operating Agreements
	Section 2(j)

	Bargaining Unit Employees
	Section 38(a)

	Base Rents
	Section 7(b)(ii)

	BK Acquisition
	Section 11(d)(xiv)

	Bookings
	Section 2(p)

	Books and Records
	Section 2(m)

	Broker
	Section 14(a)

	Building
	Recitals

	Buildings
	Recitals

	Bulk States Compliance
	Section 39(f)

	Bulk Sales Filing
	Section 39(f)

	Bulk Sales States
	Section 39(f)

	Business
	Section 7(c)(ii)

	business day
	Section 4(g)

	Cerberus Guarantors
	Section 10(c)(iii)

	Chatham LP
	Section 2(a)(i)

	Chatham Aggregate Deemed Distribution Liquid Amount
	Schedule E

	Chatham Deemed Pro-Rata Distribution Amount
	Schedule E

	Chatham Post-Distribution Liquid Amount
	Schedule E

	Chatham Post-Distribution Liquid Amount
	Schedule E

	Closing
	Section 18(a)

	Closing Date
	Section 18(a)

	Closing Statement
	Section 7(a)

	Code
	Section 2(a)(i)

	Confidentiality Agreement
	Section 29(a)

	Contracts
	Section 10(a)(ii)

	CRE Guarantors
	Section 10(c)(iii)

	CRE-Ink REIT Member
	Section 2(a)(i)

	Cure Extension Notice
	Section 11(e)

	
			
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	Current Structure Chart
	Recitals

	Cut-Off Time
	Section 7(b)

	Damages
	Section 11(e)

	Datasite
	Section 3(a)

	Deemed Disproportionate Distribution Amount
	Schedule E

	Deemed Pro-Rata Distribution Amount
	Schedule E

	Deposit
	Section 4(a)(i)

	Diligence Party
	Section 11(f)

	Disclosed Survey Items
	Section 5(a)

	Due Diligence Period
	Section 3(a)

	Effective Date
	Preamble

	Employee Benefit Funds
	Section 38(c)

	Environmental Laws
	Section 11(i)

	ERISA
	Section 11(h)(iv)

	Escrow Agent
	Section 4(a)(i)

	Excluded Personalty
	Section 8

	Exculpated Parties
	Section 11(a)

	Excluded Materials
	Section 2(b)(m)

	Existing Financing
	Section 4(d)

	Existing Mezzanine Debt
	Section 4(d)

	Existing Mortgage Debt
	Section 4(d)

	FF&E
	Section 2(d)

	F&B
	Section 2(g)

	Financials
	Section 11(d)(xxi)

	Financial Institution
	Section 11(h)(v)

	FIRPTA
	Section 21

	Franchise Agreements
	Section 7(b)(xii)

	Franchisors
	Section 7(b)(xii)

	GPARI
	Section 41(f)

	Grossed-Up Purchase Price
	Schedule E

	Grossed-Up Specified Hotel Purchase Price
	Schedule E

	Ground Lease Estoppel Certificate
	Section 9(a)(xxvi)

	Ground Lease Property
	Section 10(e)

	Guest Ledger
	Section 7(c)(i)

	Hazardous Materials
	Section 11(i)

	Hotel Employees
	Section 38(a)

	Hotel Guest Data and Information
	Section 39(d)

	Hyatt
	Section 36

	Hyatt Franchise Agreements
	Section 36

	Individual Land
	Recitals

	Individual Premises
	Recitals

	Individual Property
	Section 2

	
			
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	Individual Owner
	Recitals

	Individual Owners
	Recitals

	Initial Deposit
	Section 4(a)(i)

	Ink I
	Section 2(a)(i)

	Intangible Property
	Section 2(q)

	IT Systems
	Section 2(f)

	JPM
	Section 4(d)

	JV Assignments
	Section 17(a)(iv)

	JV Entity
	Recitals

	JV Entities
	Recitals

	JV Interests
	Recitals

	Land
	Recitals

	Leases
	Section 10(a)(i)

	Letter Agreement
	Section 10(c)(iii)

	Licenses and Permits
	Section 2(k)

	Limitation Period
	Section 11(e)

	Losses
	Section 3(e)

	Manager
	Section 3(a)

	Management Agreement
	Section 16(c)

	Marriott
	Section 4(e)

	Mezz A Loan
	Section 4(d)

	Mezz B Loan
	Section 4(d)

	Mezz C Loan
	Section 4(d)

	Net Cash Flow
	Schedule E

	New Closing Notice
	Section 6(d)

	Notices
	Section 19

	Non-Objectionable Encumbrances
	Section 6(a)(v)

	Objection Period
	Section 6(a)(iv)

	OFAC
	Section 11(h)(v)

	Operating Agreements
	Recitals

	Operating Lessee
	Recitals

	Operating Lessees
	Recitals

	Ordinary Course of Business
	Section 9(a)(i)

	Organizational Documents
	Section 11(d)(xxii)

	Overage Rent
	Section 7(b)(ii)

	Party
	Preamble

	Parties
	Preamble

	Patriot Act
	Section 11(d)(xii)

	PBGC
	Section 38(e)

	PCBs
	Section 11(i)

	Pension Fund
	Section 38(c)

	Percentage Interest
	Recitals

	
			
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	Permitted Encumbrances
	Section 5

	Person
	Section 11(h)(v)

	Plans and Specifications
	Section 2(n)

	Pre-Closing Tax Periods
	Section 42(a)

	Premises
	Recitals

	Principal Transaction
	Section 2(b)

	Proceeding
	Section 11(e)

	Properties
	Section 2

	Property Facility Revenue
	Section 7(b)(viii)

	Property Level Taxes
	Section 7(b)(i)

	Prorations
	Section 7(b)

	Purchase Price
	Section 4(a)

	Purchaser
	Preamble

	Purchaser Indemnified Parties
	Section 9(c)

	Purchaser Party
	Section 11(h)(v)

	Purchaser Related Party
	Section 35(b)

	Purchaser's Permitted Assignee
	Section 28(b)

	Purchaser's Representatives
	Section 3(a)

	Rents
	Section 7(b)(ii)

	Report
	Section 6(a)(i)

	Reports
	Section 6(a)(i)

	Report Objections
	Section 6(a)(iii)

	Representation
	Section 11(d)

	Representations
	Section 11(d)

	Representation Insurance Policy
	Section 11(e)

	Representation Update
	Section 17(a)(xv)

	Retail Merchandise
	Section 2(h)

	ROFO
	Section 36

	ROFO Property
	Section 36

	Safe Deposit Box
	Section 37(a)

	Seller Disclosure Statement
	Section 41(g)

	Specified Hotel Interests
	Section 2(a)(i)

	Specified Hotel Net Value
	Schedule E

	Specified Hotel Transaction
	Section 2(a)(i)

	Specified Hotel Transaction Consideration
	Schedule E

	Scheduled Closing Date
	Section 18(a)

	Seller
	Preamble

	Sellers
	Preamble

	Seller Party
	Section 11(d)(xi)

	Seller's Broker
	Section 14(a)

	Seller Knowledge Individuals
	Section 11(d)(xii)

	Seller Related Parties
	Section 3(e)

	
			
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	Sharing Percentages
	Section 2(a)(i)

	Specially Designated Nationals and Blocked Persons
	Section 11(h)(v)

	Specified Hotel Transaction
	Section 2(a)(i)

	Supplies
	Section 2(e)

	Surveys
	Section 5(a)

	Taking
	Section 13(a)

	Tax Certiorari Proceeding
	Section 15

	Tax Representations
	Section 11(e)

	Tax Return
	Section 42(b)

	Taxes
	Section 7(b)(i)

	Title Company
	Section 6(a)(i)

	Title Cure Period
	Section 6(a)(v)

	Title Objections
	Section 6(a)(iv)

	Trade Payables
	Section 7(b)(x)

	Transfer Taxes
	Section 16(a)

	Transfer Tax Laws
	Section 16(a)

	Transferred Entity
	Recitals

	Transferred Entities
	Recitals

	Transferred Interests
	Recitals

	Union Contract
	Section 11(d)(iv)

	Update Exception
	Section 6(a)(iv)

	Update Objection Deadline
	Section 6(a)(iv)

	U.S. Person
	Section 11(h)(v)

	Violations
	Section 6(f)

	Warranties
	Section 2(o)

		
	2.
	PURCHASE AND SALE.

(a)    Specified Hotel Transaction.
(i)    Immediately before the Closing, the members of the Transferred Entities shall cause each of INK Acquisition IV LLC, INK Acquisition V LLC, INK Acquisition VI LLC and INK Acquisition VII LLC to merge with and into INK Acquisition LLC (the "Mergers"); 
(ii)    Immediately following the Mergers and immediately prior to the Closing, the members of INK Acquisition LLC ("INK I") shall cause INK I to distribute to Chatham Lodging, L.P. ("Chatham LP") 100% of INK I's right, title and interest in and to the membership interests in Grand Prix San Mateo LLC, Grand Prix Mountain View LLC, Grand Prix Sili I LLC and Grand Prix Sili II LLC  (the Properties owned by such entities, the "Specified Hotels", and the membership interests in such entities, collectively, the "Specified Hotel Interests", and such distribution, the "Specified Hotel Transaction").  Sellers and Purchaser acknowledge and agree that, in a liquidation of INK I and INK Acquisition III LLC (collectively, the "Final Transferred Entities") following the Mergers and the sale of their assets for cash in an amount equal to the Grossed Up 

	
			
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Purchase Price (as hereinafter defined), Net Cash Flow (as hereinafter defined) of the Final Transferred Entities would be distributed 78% to the Sellers, on the one hand, and 22% to Chatham LP and Chatham TRS Holding, Inc., on the other hand, it being understood and agreed by the Parties that such percentage interests set forth in this sentence are estimates only and that the actual percentage interests will be determined based upon Section 7 of each of the limited liability company agreements of the Transferred Entities as determined on the Closing Date or such earlier date as such determination is required to be made under such agreements, as applicable) (such percentages, collectively, the "Existing Sharing Percentages").  Solely for federal income tax purposes, the Parties and Chatham LP shall treat the distribution of the Specified Hotel Interests and the payment of the Specified Hotel Transaction Consideration (as hereinafter defined) as (i) a deemed pro-rata distribution of the Specified Hotel Interests to the members of INK I with a value equal to the Deemed Pro-Rata Distribution Amount (as hereinafter defined) in a tax-deferred distribution under Section 731 of the Internal Revenue Code of 1986, as amended (the "Code"), (ii) a deemed disproportion distribution of the Specified Hotel Interests to Chatham LP with a value equal to the Deemed Disproportionate Distribution Amount in a tax-deferred distribution under Section 731 of the Code, and (iii) immediately after the deemed distributions required to in clauses (i) and (ii), the deemed taxable sale by CRE-Ink REIT Member LLC to Chatham LP of CRE-Ink REIT Member LLC's portion of Specified Hotel Interests deemed distributed to CRE-Ink REIT Member LLC in the deemed distribution referred to in clause (i) for an amount equal to the Specified Hotel Transaction Consideration.  The Parties shall not take any position inconsistent with the one described in the preceding sentence.  For purposes of interpretation of this Agreement, the Specified Hotels shall be considered Individual Properties and the entities whose interests are being distributed in the Specified Hotel Transaction shall be considered JV Entities.  Capitalized terms used in this Section 2(a)(ii) and not otherwise defined shall have the meanings set forth on Schedule E attached hereto.  Notwithstanding anything to the contrary contained herein, if Purchaser and Chatham LP jointly so elect, upon not less than five (5) business days' notice to Sellers, the Specified Hotel Transaction will not occur and instead Purchaser shall indirectly acquire the Specified Hotel Interests by means of Purchaser's acquisition of the Transferred Interests pursuant to the terms and provisions hereof, provided that in such event Chatham LP will be released from all obligations under this Agreement and Purchaser shall be required to pay the Specified Hotel Transaction Consideration.
(b)    Principal Transaction.  At the Closing, immediately after the consummation of the Specified Hotel Transaction, each of the Sellers listed in Schedule A shall sell, assign and convey to Purchaser, and Purchaser shall purchase and acquire from each such Seller, subject to the terms and conditions of this Agreement and the Operating Agreement of such Transferred Entity, all of its right, title and interest in and to such Seller's  Percentage Interest in the Transferred Entity listed opposite such Seller's name on Schedule B-2, in each case, free and clear of all liens, encumbrances, claims, or other rights other than those arising under the Operating Agreement of such Transferred Entity (the "Principal Transaction"); and
(c)    As a result of the transactions contemplated by Sections 2(a) and (b) above, Purchaser shall indirectly acquire, all of Sellers' indirect interest in and to the JV Interests including, without limitation, the Individual Owners and Operating Lessees and the following: 

	
			
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	a.
	the Premises, which shall include, without limitation, (i) all easements, rights of way, privileges, appurtenances and other similar rights, if any, pertaining thereto, (ii) all right, title and interest of each Individual Owner, if any, in and to any land lying in the bed of any street, road or avenue opened or proposed, public or private, in front of or adjoining any portion of the Land, to the center line thereof and (iii) subject to Section 12 below, all right, title and interest of each Individual Owner, in and to any award received following the Closing Date solely with respect to damage to any portion of the Land by reason of change of grade of any street, and the Buildings;

		
	b.
	the Leases (as hereinafter defined) in effect on the Closing Date;

		
	c.
	the Buildings and all fixtures on the Land or in the Buildings which constitute real property under applicable law, including, without limitation, the hotels located on the Premises;

		
	d.
	all fixtures, furniture, furnishings, equipment, machinery, inventory, tools, vehicles, signs, appliances, vehicles, art work and other items of tangible personal property which are owned by any Individual Owner or Operating Lessee or located at any of the Premises or used or usable in connection with the business conducted at the Premises (other than property owned by tenants) (collectively, the "FF&E"); 

		
	e.
	all china, paper goods, tablecloths, glassware and silverware, linens, uniforms, engineering, maintenance, cleaning and housekeeping and other supplies, matches and ashtrays, soap and other toiletries, stationery, menus, directories and other printed materials, and all other supplies and materials and similar items, which are located at the Premises or used or usable in connection with the business conducted at the Premises, as of the Closing (collectively, the "Supplies");

		
	f.
	all computer hardware and equipment, telephones, scanners, facsimile machines, postal machines, telecommunications and information technology systems located at or used in connection with the Premises, and all computer software used at or in connection with the Premises (subject to the terms of the applicable license agreement, if any), to the extent the same are owned by any Operating Lessee or any Individual Owner (collectively, the "IT Systems");

		
	g.
	all food and beverages (alcoholic (if permitted by law)     and nonalcoholic) which are located at, used or useable at the Premises 

	
			
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(whether opened or unopened), as of the Closing, including, without limitation, all food and beverages located in mini-bars or elsewhere in guest rooms (collectively, the "F&B"); 
		
	h.
	all merchandise located at the Premises and/or held for sale to guests and customers of the Premises as of the Closing, including, without limitation, the inventory held for sale in any gift shop or newsstand operated by any Seller at the Premises, but expressly excluding items owned by tenants (collectively, the "Retail Merchandise");

		
	i.
	all leases and purchase money security agreements for any equipment, machinery, vehicles, furniture or other personal property located at, or used exclusively in connection with, the Premises which are held by any Operating Lessee or any Individual Owner, together with all deposits made thereunder, to the extent the same and such deposits are transferable with respect to the transactions described herein or the Parties obtain any consent necessary to effectuate such a transfer;

		
	j.
	all Contracts to the extent the same are transferable with respect to the transactions described herein or the Parties obtain any consent necessary to effectuate such a transfer (collectively, the "Assigned Operating Agreements"); 

		
	k.
	all licenses, permits, consents, authorizations, approvals, registrations and certificates issued by any governmental authority which are held by any Individual Owner or any Operating Lessee with respect to the Premises or which otherwise relate to the Premises, including, without limitation, the construction, use or occupancy of the Buildings, any real property or the Business, together with any deposits made by any Seller thereunder, to the extent the same are transferable with respect to the transactions described herein or the Parties obtain any consent necessary to effectuate such a transfer (the "Licenses and Permits");

		
	l.
	all Hotel Guest Data and Information (as hereinafter defined);

		
	m.
	all books and records located at, or relating exclusively to, the Business or any of the Premises (as hereinafter defined), but expressly excluding all documents and other materials which (the "Excluded Materials") (i) are legally privileged or constitute attorney work product (provided that, prior to the expiration of the Due Diligence Period, Sellers have advised Purchaser in writing if any such information being withheld from Purchaser materially and adversely effects the Transferred Interests, the JV Interests or the Properties), (ii) are subject to an applicable law or a confidentiality 

	
			
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agreement prohibiting their disclosure by Seller (provided that, prior to the expiration of the Due Diligence Period, Sellers have advised Purchaser in writing if any such information being withheld from Purchaser materially and adversely effects the Transferred Interests, the JV Interests or the Properties), or (iii) constitute confidential internal assessments, memoranda, notes or other informal correspondence prepared by, for or on behalf of any officer or employee of Seller which was not delivered to third parties other than such officers or employees, including, without limitation, all (A) internal financial analyses and appraisals (provided, however, that as part of its due diligence process, Purchaser shall have access to the lease projections used by Chatham Lodging, L.P. and the Sellers to set the rents on the hotel operating leases), and (B) any informal work papers, internal memoranda, internal analysis, internal correspondence and similar documents and materials in each case that were prepared by or for Seller in connection with the transactions described in this Agreement (collectively, the "Books and Records");
		
	n.
	all plans and specifications, blue prints, architectural plans, engineering diagrams and similar items located at the Premises or in any Seller's, Transferred Entity's or JV Entity's possession or control which relate exclusively to the Premises (collectively, the "Plans and Specifications");

		
	o.
	all warranties and guaranties with respect to any of the other components of the Properties, to the extent the same are transferable (and Sellers shall, after the Closing, at no cost or expense to Seller, at Purchaser's written direction, use good faith efforts to enforce any of the same on Purchaser's behalf to the extent any of the same cannot be enforced after the Closing and provided Purchaser indemnifies Sellers for any losses sustained by Sellers as a result thereof) (collectively, the "Warranties"); 

		
	p.
	all bookings and reservations for guest, meeting, conference and banquet rooms or other facilities at the Premises as of the Closing, including, without limitation, (i) any internet and travel agent reservation agreements and promotions, if any, in effect with respect to each Individual Premises, and (ii) group room bookings and contracts, together with all deposits held by Seller with respect thereto (collectively, the "Bookings");

		
	q.
	(i) any and all trademarks, service marks, copyrights, logos and trade names, together with all translations, adaptations, derivations, and combinations thereof and including, without limitation, all 

	
			
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goodwill associated therewith, and all applications, registrations, and renewals in connection therewith, (ii) all copyrightable works, all copyrights, and applications, registrations, and renewals in connection therewith, (iii) all trade secrets and business information (including ideas, research and development, know-how, formulas, compositions, marketing processes and techniques, technical data, designs, drawings, customer and supplier lists, pricing and cost information, and business and marketing plans and proposals), (iv)  website and email addresses and domain names, telephone numbers and listings, (v) all general intangibles relating to design, development, operation and use of the Buildings and the Hotels, (vi) all rights and work product under construction, service, consulting, engineering, architectural and other contracts, (vii) keys and lock and safe combinations and (viii) all promotional materials, in each case solely to the extent any of the same are owned by Sellers, any Transferred Entity or any JV Entity which  relate exclusively to the Premises (collectively the "Intangible Property");
		
	r.
	 all of Grand Prix Ft. Lauderdale LLC's right, title and interest as lessee, under the Fort Lauderdale Ground Lease; and

		
	s.
	all Accounts Receivable (including the Guest Ledger) as set forth in Sections 7(c)(i) and (ii).

The items described in clauses (a)-(s) above are sometimes referred to individually as an "Individual Property" and collectively as the "Properties."
Upon Purchaser's prior written request, Sellers shall, on or prior to the Closing Date, cause 100% of the limited liability company interests in GP AC Sublessee LLC to be transferred to INK Lessee LLC, free of liens other than as permitted pursuant to this Agreement.  For the avoidance of doubt, it is expressly acknowledged and agreed that in no event shall (x) Purchaser, Chatham LP or any other Person be permitted to acquire the Specified Hotels under this Agreement unless the Principal Transaction occurs simultaneously, and (y) the Principal Transaction occur unless Purchaser or Chatham LP simultaneously therewith acquires the Specified Hotels.
		
	3.
	DUE DILIGENCE PERIOD; ACCESS; RIGHTS OF INSPECTION AND CONFIDENTIALITY.

(a)    During the period prior to the Effective Date and continuing until 5:00 p.m., New York time, on May 15, 2014 (the "Due Diligence Period"), and thereafter if this Agreement is not terminated prior to the expiration of the Due Diligence Period in accordance with the terms hereof, Purchaser shall conduct its review and due diligence and physically inspect the Properties in accordance with this Section 3 and the other provisions of this Agreement.  Prior to the Effective Date, each Seller has made available to Purchaser on that certain website maintained by Seller's Broker (as hereinafter defined) (the "Datasite"), copies of the documents and/or information relating to the Properties to the extent such documents and information are in such 

	
			
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Seller's possession or control by posting same on the Datasite or otherwise causing the same to be delivered to Purchaser.  Each Seller shall permit Purchaser and Purchaser's direct and indirect  agents, employees, attorneys, accountants, consultants, advisors, title company, lenders, investors (prospective and current), inspectors, appraisers, engineers, contractors, affiliates, experts, partners, officers and other persons that Purchaser deems reasonably need to know such information (collectively, "Purchaser's Representatives") to examine and audit the same and to make copies of same at Purchaser's expense.  Notwithstanding the foregoing, Seller shall have no obligation to make available or deliver to Purchaser any Excluded Materials.  Sellers have made available to Purchaser on the Datasite or at the Properties or by otherwise causing the same to be delivered to Purchaser, to the extent in any Seller's possession or control, among other things: plans and specifications; copies of all the Leases and the Contracts and Seller's Books and Records relating to the operation of the Properties.  Purchaser acknowledges its receipt of the due diligence materials set forth on the Datasite for the Properties.  For purposes of this Agreement, "Manager" shall mean Island Hospitality Management, Inc., a Florida corporation, or any other Person that manages any one or more of the Properties. 
(b)    Subject to the provisions of Section 3(c), Purchaser's Representatives shall have the right, through the Closing Date, from time to time, upon the advance notice required pursuant to Section 3(c), to enter upon and pass through the Premises and examine the other components of the Properties during normal business hours to examine and inspect the same.  Notwithstanding any such inspection, or anything to the contrary herein contained, Purchaser's obligations hereunder shall not be limited or otherwise affected as a result of any fact, circumstance or other matter of any kind discovered following the Effective Date in connection with any such inspection, access or otherwise except as expressly provided in this Agreement (it being agreed that Sellers are permitting Purchaser such right of inspection and access as a courtesy to Purchaser in its preparation for taking title to the  Transferred Interests) except as expressly provided in this Agreement.  
(c)    In conducting any inspection of the Premises or otherwise accessing the Premises, Purchaser shall at all times comply with all laws and regulations of all applicable governmental authorities, and neither Purchaser nor any of Purchaser's Representatives shall (i) (x) conduct any inspection or otherwise access any Individual Premises or (y) contact or have any discussions with any of Manager's employees, agents or representatives, or with any tenants at, or contractors providing services to, the Individual Premises, unless in each case Purchaser has given any Seller at least one (1) business day's notice and, if so elected by such Seller, has a representative of such Seller in attendance at such inspection or meeting, (ii) unreasonably interfere with the business of Seller (or any of its tenants or guests) conducted at the Premises or unreasonably disturb the use or occupancy of any occupant of the Premises, or (iii) damage the Properties unless Purchaser promptly repairs the same.  Notwithstanding the foregoing, Purchaser and Purchaser's Representatives may meet with, discuss with and interview the general manager, any director, any executive or any person with a managerial position at any of the Properties, but shall not be entitled to meet with, communicate with or interview any other Individual Property employees other than following the expiration of the Due Diligence Period if Purchaser has delivered the Additional Deposit in connection with hiring them as of the Closing.  In conducting the foregoing inspection or otherwise accessing the Premises, Purchaser and Purchaser's Representatives shall at all times 

	
			
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comply with, and shall be subject to, the rights of any guests and any of the tenants under the Leases (and any persons claiming under or through such tenants).  Sellers may from time to time establish reasonable rules of conduct for Purchaser and Purchaser's Representatives in furtherance of the foregoing.  Purchaser shall schedule and coordinate all inspections, including, without limitation, any environmental tests, or other access with Seller and shall give Seller at least one (1) business days' prior notice thereof.  Sellers shall be entitled to have a representative present at all times during each such inspection or other access.  Purchaser agrees to pay to the Seller of the applicable Individual Property on demand the cost of repairing and restoring any damage which Purchaser or Purchaser's Representatives shall cause to the Properties that Purchaser does not repair.  All inspection fees, appraisal fees, engineering fees and other costs and expenses of any kind incurred by Purchaser or Purchaser's Representatives relating to such inspection and its other access shall be at the sole expense of Purchaser.  In the event that the Closing hereunder shall not occur for any reason whatsoever (other than any Seller's default), Purchaser shall (A) if requested by Sellers, promptly deliver to Seller, provided Sellers reimburse Purchaser for the actual out-of-pocket costs thereof, and without representation or warranty, the originals of all tests, reports and inspections of the Premises, made and conducted by Purchaser or Purchaser's Representatives or for Purchaser's benefit which are in the possession or control of Purchaser or Purchaser's Representatives, and (B) promptly return to Seller copies of all due diligence materials delivered by Seller to Purchaser and shall destroy all copies and abstracts thereof except as required by law or the document retention policies of Purchaser or any of its direct or indirect investors or affiliates.  Prior to the Closing, Purchaser or Purchaser's Representatives and any others who gain access to the due diligence materials through Purchaser or Purchaser's Representatives shall treat all such due diligence materials as confidential and proprietary to Seller, and shall not disclose to others during the term of this Agreement (or for one (1) year thereafter in the event that the Closing hereunder shall not occur) any such due diligence materials whether verbal or written, or any description whatsoever which may come within the knowledge of Purchaser, Purchaser's Representatives or such other parties, unless, in each instance, Purchaser obtains the prior written consent of the Seller of the applicable Individual Property (except in each such instance as otherwise expressly permitted herein or in the Confidentiality Agreement (as hereinafter defined)).  Purchaser and Purchaser's Representatives shall not be permitted to conduct borings of the Premises or drilling in or on the Premises, or any other invasive testing, in connection with the preparation of an environmental audit or in connection with any other inspection of the Premises without the prior written consent of Seller of the applicable Individual Property which shall not be unreasonably withheld (and, if such consent is given, Purchaser shall be obligated to pay to such Seller promptly after written demand the cost of repairing and restoring any borings or holes created or any other damage as aforesaid which is not repaired by Purchaser and, in the event this Agreement is not terminated prior to the expiration of the Due Diligence Period and Purchaser thereafter shall become entitled under any other provision of this Agreement to a return of the Deposit, any such repair or restoration cost remaining unpaid may be withheld from the Deposit (in accordance with Section 4(b)(4) hereof) and paid to Seller before any remaining balance of the Deposit is returned to Purchaser provided that the amount to be so withheld shall not exceed the lesser of (x) the sum of $2,500,000 in the aggregate with respect to all matters under this Agreement for which it is stated that amounts may be withheld from the Deposit or that the Deposit secures an obligation of Purchaser, or (y) the actual reasonable out-of-pocket cost of such repair.  Any liens against the Premises, or any portion thereof, arising from the performance of services by third-party contractors retained by Purchaser in connection with Purchaser's due diligence activities 

	
			
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shall be removed by Purchaser as promptly as practicable and in any event not later than ten (10) business days' after Purchaser shall have been notified of the filing of such liens.  The provisions of this Section 3(c) shall survive any termination of this Agreement but shall not survive the Closing. 
(d)    Prior to conducting any physical inspection or testing at any Individual Premises, other than mere visual examination, including without limitation, boring, drilling and sampling of soil, Purchaser shall obtain, and during the period of such inspection or testing shall maintain, at its expense, commercial general liability insurance, including a contractual liability endorsement, and personal injury liability coverage, with the Individual Owner and Operating Lessee of the applicable Individual Property and its managing agent, if any, as additional insureds, from an insurer reasonably acceptable to Seller, which insurance policies must have limits for bodily injury and death of not less than Three Million Dollars and 00/100 ($3,000,000.00) for any one occurrence and not less than Three Million Dollars and 00/100 ($3,000,000.00) for property damage liability for any one occurrence.  Prior to making any entry upon any Individual Premises, Purchaser shall furnish to the applicable Seller a certificate of insurance evidencing the foregoing coverages. 
(e)    Purchaser agrees to indemnify and hold each Seller and its disclosed or undisclosed, direct and indirect, shareholders, officers, directors, trustees, partners, principals, members, employees, agents, affiliates, representatives, consultants, accountants, contractors and attorneys or other advisors, and any successors or assigns of any of the foregoing and Manager (collectively with Sellers, the "Seller Related Parties") harmless from and against any and all losses, costs, damages, liens, claims, liabilities or expenses (including, but not limited to, reasonable attorneys' fees, court costs and disbursements) ("Losses") for personal injury or property damage incurred by any Seller Related Parties arising from or by reason of (to the extent not caused by any Seller Related Parties) (i) Purchaser's and/or Purchaser's Representatives' access to, or inspection of, the Premises, or any tests, inspections or other due diligence conducted by or on behalf of Purchaser and (ii) Purchaser's breach of any of the terms or provisions of this Section 3, provided, notwithstanding anything to the contrary contained herein,  Purchaser shall not be obligated to indemnify Seller Related Parties for any Losses (or repair or remediate any condition) relating to a pre-existing condition at the Premises that was merely discovered by Purchaser or a Purchaser Representative.  The provisions of this Section 3(e) shall survive the any termination of this Agreement.
(f)    Notwithstanding anything to the contrary contained in this Agreement, Purchaser shall have the period commencing on the Effective Date and expiring upon the end of the Due Diligence Period during which to determine that either (i) Purchaser has determined to proceed with the transactions contemplated hereby or (ii) Purchaser has determined to terminate this Agreement pursuant to this clause (f).  If Purchaser delivers any Seller a written notice under clause (i) above and has made the Additional Deposit (as hereinafter defined) before the expiration of the Due Diligence Period, then Purchaser shall be deemed to have waived any further right to terminate this Agreement pursuant to this clause (f), the Due Diligence Period shall be deemed to have expired on the date such notice was delivered, and this Agreement shall continue in full force and effect.  If Purchaser delivers a notice under clause (ii) above before the expiration of the Due Diligence Period, then Escrow Agent shall immediately refund the Initial Deposit (and 

	
			
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all interest accrued thereon) to Purchaser, and upon such refund, this Agreement shall be deemed canceled and of no further force or effect and no party hereto shall have any further rights or obligations hereunder, except those arising under provisions of this Agreement that expressly survive the termination hereof.  Purchaser's failure to deliver any notice pursuant to this clause (f) before the expiration of the Due Diligence Period shall be deemed an election by Purchaser under clause (ii) on the last day of the Due Diligence Period.  Purchaser shall have the right to deliver Purchaser's Notice under clauses (i) or (ii) above for any reason or for no reason in Purchaser's sole and absolute discretion. Without limiting the foregoing, if Purchaser elects, in its sole discretion for any reason or for no reason, not to deposit the Additional Deposit with Escrow Agent (as hereinafter defined) before the expiration of the Due Diligence Period, Escrow Agent shall promptly return the Initial Deposit to Purchaser, this Agreement shall be deemed canceled and of no further force or effect and no party hereto shall have any further rights or obligations hereunder, except those arising under provisions of this Agreement that expressly survive the termination hereof.  Notwithstanding anything to the contrary contained herein, the Parties acknowledge and agree that, provided Purchaser deposits the Additional Deposit on the Effective Date, Purchaser has waived its right to terminate this Agreement pursuant to this Section 3(f), the Due Diligence Period has expired and Purchaser has elected to proceed with the transactions contemplated hereby pursuant to this Section 3(f) (subject to the other terms and provisions of this Agreement).
(g)    Notwithstanding anything contained or implied herein to the contrary (i) except for Sellers' representations, covenants and warranties expressly contained herein (in the case of representations and warranties, as they are qualified by the applicable schedules hereto (as such schedules may be modified or supplemented in the Representation Update)), Purchaser is accepting the Property "AS IS" and "WHERE IS" and anything disclosed in its inspection shall not relieve Purchaser from its obligations hereunder, and (ii) Purchaser shall have no right to terminate this Agreement or obtain a return of the Deposit except as expressly provided in this Agreement.
		
	4.
	PURCHASE PRICE AND DEPOSIT.

(a)    The purchase price to be paid by Purchaser to Sellers equals the amount set forth on Schedule J under the column entitled "Purchase Price" corresponding to the date on which the Closing occurs (the "Purchase Price") (it being acknowledged and agreed by the Parties that the Purchase Price will be adjusted based on the Closing Date, as more particularly set forth on Schedule J), which the Parties agree is to be allocated (the "Allocated Purchase Price") to each Individual Property and Individual Owner (and the components of each Individual Property) as set forth on Schedule B-1 attached hereto.  In addition, the Parties agree that the Allocated Equity Purchase Price (as defined on Schedule B-1 attached hereto) shall be allocated to the Transferred Interests in each Transferred Entity and the Specified Hotel Interests as set forth on Schedule B-1, provided, however, that the Parties agree that the Allocated Equity Purchase Price with respect to CRE-Ink-TRS Holding, Inc.'s interest in INK Acquisition III LLC will be set prior to the Closing Date at a mutually agreed upon price not to exceed $100,000.00, and that such amount shall be set forth on Schedule B-1.  The Purchase Price owed by Purchaser herein shall be subject to apportionment as provided in Section 7 and elsewhere herein.  The Deposit (as hereinafter defined) shall be payable as follows: 

	
			
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(i)    Within one (1) business day after the execution of this Agreement by Purchaser, Sellers and Escrow Agent, Purchaser shall deliver to Fidelity National Title Insurance Company (the "Escrow Agent"), as escrow agent, a wire transfer in immediately available federal funds in the amount of Twenty Million Dollars ($20,000,000.00) (the "Initial Deposit") to the escrow account of the Escrow Agent in accordance with the wire instructions set forth on Exhibit 1 (the Initial Deposit and the Additional Deposit, if any, shall hereinafter be collectively referred to as, the "Deposit").  It shall be a condition precedent to the effectiveness of this Agreement that Purchaser shall have timely delivered the Initial Deposit to the Escrow Agent as provided above in this Section 4(a)(i).
(ii)    If Purchaser elects, in its sole and absolute discretion, to proceed with the transaction contemplated by this Agreement pursuant to Section 3(f) above, then, on or before 5:00 p.m., New York time, on the last day of the Due Diligence Period, Purchaser shall deliver to Escrow Agent a wire transfer in immediately available federal funds in the amount of Ten Million Dollars ($10,000,000.00) (the "Additional Deposit").
(b)    (i)    Upon receipt by Escrow Agent of the Deposit, Escrow Agent shall cause the same to be deposited into an interest bearing account at a bank selected by Escrow Agent and reasonably approved by Seller and Purchaser, it being agreed that Escrow Agent shall not be liable for (y) any loss of such investment (unless due to Escrow Agent's gross negligence, willful misconduct or breach of this Agreement) or (z) any failure to attain a favorable rate of return on such investment.  Escrow Agent shall not be responsible for levies by taxing authorities based upon the taxpayer identification number used to establish this interest bearing account.  Escrow Agent shall deliver the Deposit, and the interest accrued thereon, to Seller or to Purchaser, as the case may be, under the following conditions:
(1)    The Deposit (together with all interest accrued thereon) shall be delivered to Sellers at the Closing upon receipt by Escrow Agent of a statement executed by Sellers and Purchaser authorizing the Deposit and the interest accrued thereon to be released.  The Deposit, and the interest accrued thereon, shall be delivered to Sellers following receipt by Escrow Agent of written demand therefor from Sellers (copying Purchaser) stating that Purchaser has defaulted in the performance of its obligations under this Agreement, provided Purchaser shall not have given written notice of objection in accordance with the provisions set forth below; or
(2)    The Deposit, and the interest accrued thereon, shall be delivered to Purchaser following receipt by Escrow Agent of written demand therefor from Purchaser (copying Sellers) stating that any Seller has defaulted in the performance of its obligations under this Agreement or that this Agreement was terminated under circumstances entitling Purchaser to the return of the Deposit, and specifying the Section of this Agreement which entitles Purchaser to the return of the Deposit, in each case provided Seller shall not have given written notice of objection in accordance with the provisions set forth below; or

	
			
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(3)    The Deposit, and the interest accrued thereon, shall be delivered to Purchaser or Seller as directed by written instructions signed by both Seller and Purchaser.  
(4)    Upon the receipt of a written demand for the Deposit by Seller or Purchaser, pursuant to subsection (1) or (2) above, Escrow Agent shall promptly give notice thereof (including a copy of such demand) to the other party.  The other party shall have the right to object to the delivery of the Deposit, by giving written notice of such objection to Escrow Agent at any time within five (5) business days' after such party's receipt of notice from Escrow Agent, but not thereafter.  Such notice shall set forth the basis (in reasonable detail) for objecting to the delivery of the Deposit.  Upon receipt of such notice of objection, Escrow Agent shall promptly give a copy of such notice to the party who filed the written demand.  If Escrow Agent shall have timely received such notice of objection, Escrow Agent shall continue to hold the Deposit, and the interest accrued thereon, until (x) Escrow Agent receives joint written notice from Seller and Purchaser directing the disbursement of the Deposit, in which case Escrow Agent shall then disburse the Deposit, and the interest accrued thereon, in accordance with said direction, or (y) litigation is commenced between Seller and Purchaser, in which case Escrow Agent shall deposit the Deposit, and the interest accrued thereon, with the clerk of the court in which said litigation is pending, or (z) Escrow Agent takes such affirmative steps as Escrow Agent may elect, at Escrow Agent's option, in order to terminate Escrow Agent's duties hereunder, including but not limited to depositing the Deposit, and the interest accrued thereon, in court and commencing an action for interpleader, the costs thereof to be borne by whichever of Seller or Purchaser is the losing party in such interpleader action.
(ii)    Escrow Agent may rely and act upon any instrument or other writing reasonably believed by Escrow Agent to be genuine and purporting to be signed and presented by any person or persons purporting to have authority to act on behalf of Seller or Purchaser, as the case may be, and shall not be liable for (a) any loss, cost or damage incurred by Escrow Agent in connection with the performance of any duties imposed upon Escrow Agent by the provisions of this Agreement, except for loss, cost or damage sustained as a result of Escrow Agent's own gross negligence, willful misconduct or breach of its obligations under this Agreement or (b) any loss or impairment of the Deposit, and the interest accrued thereon, that is deposited with a Federally insured financial institution approved by Seller and Purchaser, resulting from the failure, insolvency, or suspension of the depositary.  Escrow Agent shall have no duties or responsibilities except those set forth herein.  Escrow Agent shall not be bound by any modification, cancellation or rescission of this Agreement unless the same is in writing and signed by Purchaser and Seller, and, if Escrow Agent's duties hereunder are affected, Escrow Agent, unless Escrow Agent shall have given prior written consent thereto.  Purchaser and Seller each hereby agree to severally (but not jointly) indemnify and save Escrow Agent harmless from any and all loss, damage, claims, liabilities, judgments and other cost and expense of every kind and nature which may be incurred by Escrow Agent arising out of its acting as Escrow Agent hereunder (including, without limitation, reasonable legal fees and disbursements of outside counsel) except in the case of its own willful misconduct, gross negligence or breach of its obligations under this Agreement, with Seller and Purchaser each being responsible to Escrow Agent for a fifty 

	
			
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percent (50%) share of the total loss, damage, claims, liabilities, judgments and other costs and expenses incurred by Escrow Agent except as otherwise expressly provided herein.  Escrow Agent shall be reimbursed by Seller and Purchaser for any expenses (including reasonable legal fees and disbursements of outside counsel), including all of Escrow Agent's fees and expenses with respect to any interpleader action incurred in connection with this Agreement, and such liability shall be several (but not joint); provided, however, that, as between Purchaser and Seller, the prevailing party in any dispute over the Deposit shall be entitled to reimbursement by the losing party of any such expenses paid to Escrow Agent.  In the event that Escrow Agent shall be uncertain as to Escrow Agent's duties or rights hereunder, or shall receive instructions from Purchaser or Seller that, in Escrow Agent's opinion, are in conflict with any of the provisions hereof, Escrow Agent shall be entitled to hold the Deposit, and the interest accrued thereon and may decline to take any other action.  After delivery of the Deposit, and the interest accrued thereon, in accordance herewith, Escrow Agent shall have no further liability or obligation of any kind whatsoever.
(iii)    Escrow Agent shall have the right at any time to resign upon ten (10) business days' prior notice to Seller and Purchaser.  Seller and Purchaser shall jointly select a successor Escrow Agent and shall notify Escrow Agent of the name and address of such successor Escrow Agent within ten (10) business days' after receipt of notice of Escrow Agent of its intent to resign.  If Escrow Agent has not received notice of the name and address of such successor Escrow Agent within such period, Escrow Agent shall have the right to select on behalf of Seller and Purchaser a bank or trust company licensed to do business in the State of New York and having a branch located in New York County to act as successor Escrow Agent hereunder.  At any time after the ten (10) business day period, Escrow Agent shall have the right to deliver the Deposit, and the interest accrued thereon, to any successor Escrow Agent selected hereunder, provided such successor Escrow Agent shall execute and deliver to Seller and Purchaser an assumption agreement whereby it assumes all of Escrow Agent's obligations hereunder.  Upon the delivery of all such amounts and such assumption agreement, the successor Escrow Agent shall become the Escrow Agent for all purposes hereunder and shall have all of the rights and obligations of the Escrow Agent hereunder, and the resigning Escrow Agent shall have no further responsibilities or obligations hereunder.
(iv)    The interest earned on the Deposit shall be paid to the party entitled to receive the Deposit as provided in this Agreement.  At Closing, Purchaser shall receive a credit against the Purchase Price with respect to any such interest paid to any Seller at Closing.  The Party receiving such interest shall pay any income taxes thereon.  The provisions of this Section 4(b) shall survive the Closing or the termination of this Agreement.
(v)    Notwithstanding anything to the contrary contained in this Agreement, including, without limitation, the other provisions of this Section 4, prior to the expiration of the Due Diligence Period, the escrow established hereunder shall be a "sole order" escrow for the benefit of Purchaser (meaning that Escrow Agent shall act solely in accordance with the instructions of Purchaser until the expiration of the Due Diligence Period in respect of the Initial Deposit and all interest accrued thereon).  Without limiting the 

	
			
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generality of the foregoing, in the event that on or prior to the expiration of the Due Diligence Period, Purchaser delivers notice to Escrow Agent stating that Purchaser has elected to terminate this Agreement pursuant to the provisions of Section 3(f) then Escrow Agent shall refund to Purchaser the Initial Deposit (and accrued interest thereon) without any requirement that Escrow Agent first notify or obtain any approval or consent of any Seller as provided in this  Section 4 above.  In furtherance of the foregoing, in the event Purchaser so instructs Escrow Agent on or prior to the expiration of the Due Diligence Period, Escrow Agent agrees that it shall not be permitted to, and shall not, follow any conflicting instructions given by any Seller or any third party as to the disposition of the Deposit and such accrued interest but shall instead follow only the instructions of Purchaser in connection therewith.  Sellers agree in such instance not to deliver any conflicting instructions to Escrow Agent for any reason and hereby instructs Escrow Agent to act in respect of the Deposit and such accrued interest solely in accordance with Purchaser's instructions on or prior to the expiration of the Due Diligence Period, including instructions of Purchaser to return the Deposit and such accrued interest to Purchaser.
(c)    At the Closing, Seller shall be entitled to retain the Deposit (together with all interest accrued thereon) and Purchaser shall deliver the balance of the Purchase Price (i.e., the Purchase Price less the Deposit (but with a credit for any interest accrued thereon)) to Escrow Agent (with instructions to deliver the same to Sellers at the Closing), as adjusted pursuant to Section 7 and elsewhere herein.
(d)    In addition to the Purchase Price, Purchaser expressly acknowledges and agrees that Purchaser shall be responsible to pay one hundred percent (100%) of the Spread Maintenance Payment (as defined in the loan documents evidencing the Existing Financing which were provided on the Datasite without regard to any amendments thereto (the "Loan Documents")) as set forth on the existing mortgage and mezzanine lenders' payoff letters (to the extent the same are consistent with the Loan Documents) but not any other costs, fees and charges relating to the prepayment or prepayment penalties that the Individual Owners are required to pay as a result of them prepaying the Existing Financing (as hereinafter defined) at the Closing (if the Closing occurs).  The Existing Financing consists of: (i) the Individual Owners are the borrowers under that certain mortgage loan encumbering the Properties originated by JPMorgan Chase Bank, National Association ("JPM") in the original principal amount of Five Hundred Seventy Five Million Dollars ($575,000,000.00) (the "Existing Mortgage Debt"); (ii) Mezz A Borrowers (as defined on Schedule H-1) are the borrowers under that certain mezzanine A loan originated by JPM in the original principal amount of One Hundred Eighty-Five Million Dollars ($185,000,000.00) secured by a pledge of Mezz A Borrower's membership interests the Individual Owners (the "Mezz A Loan"); (iii) Mezz B Borrowers (as defined on Schedule H-2) are the borrowers under that certain mezzanine B loan originated by JPM in the original principal amount of One Hundred Million Dollars ($100,000,000.00) secured by a pledge of Mezz B Borrower's membership interests in Mezz A Borrowers (the "Mezz B Loan"); and (iv) Mezz C Borrowers (as defined on Schedule H-3) are the borrowers under that certain mezzanine C loan originated by JPM in the original principal amount of Ninety Million Dollars ($90,000,000.00) secured by a pledge of Mezz C Borrower's membership interests in Mezz B Borrowers (the "Mezz C Loan"; and together with the Mezz A 

	
			
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Loan and the Mezz B Loan, collectively, the "Existing Mezzanine Debt"; and the Existing Mezzanine Debt, together with the Existing Mortgage Debt, collectively, the "Existing Financing").
(e)    Notwithstanding anything to the contrary contained in this Agreement or in any other document, it is expressly acknowledged and agreed by Purchaser that as a material inducement to Sellers to enter into this Agreement, Purchaser shall, at its sole cost and expense, complete the Gatehouse Renovations (as defined in certain letter agreement dated as of April 24, 2013 from Marriott International, Inc. ("Marriott") and acknowledged and agreed to by Operating Lessee with respect to Generation One Residence Inn Hotels and Term Extensions for Grand Prix Fixed Lessee LLC and INK Lessee LLC) and the construction of gate houses and renovations of lobbies at certain Properties and any other "PIP" work.  It is acknowledged and agreed by the Parties that the Purchase Price has been reduced in order to compensate Purchaser for the cost of such Gatehouse Renovations and "PIP" Work that the Franchisors may require Purchaser to complete as a condition to their consent to the transactions contemplated hereby and their entering into new Franchise Agreements with Purchaser.
(f)    All monies payable by Purchaser under this Agreement, unless otherwise specified in this Agreement, shall be paid by Purchaser causing such monies to be wire transferred in immediately available federal funds at such bank account or accounts designated by Escrow Agent (with instructions to deliver the same to Sellers), and divided into such amounts designated by Sellers in writing as may be required to consummate the transactions contemplated by this Agreement.
(g)    As used in this Agreement, the term "business day" shall mean every day other than Saturdays, Sundays, all days observed by the federal or New York State government as legal holidays and all days on which commercial banks in New York State are required by law to be closed.  Any reference in this Agreement to a "day" or a number of "days" (other than references to a "business day" or "business days") shall mean a calendar day or calendar days.
		
	5.
	STATUS OF TITLE.

Subject to the terms and provisions of this Agreement, each Individual Owner's interest in the Premises, at the Closing, shall be subject only to the following except as otherwise expressly provided in this Agreement (collectively, the "Permitted Encumbrances"):
(a)    the state of facts disclosed for each Individual Property (the "Disclosed Survey Items") on the surveys (collectively, the "Surveys") delivered to Purchaser by Sellers prior to the Effective Date, and any further state of facts which are not Disclosed Survey Items as a current survey or inspection of the Premises would disclose, provided such further state of facts do not materially and adversely affect the current use of the Premises;
(b)    the standard pre-printed exclusions from coverage contained in the ALTA owner's title insurance policy from the Title Company (as hereinafter defined) currently in use in the jurisdiction where the applicable Individual Property is located;

	
			
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(c)    Non-Objectionable Encumbrances (as hereinafter defined); and any liens, encumbrances or other title exceptions approved or waived by Purchaser as provided in this Agreement; 
(d)    property taxes which are a lien but not yet due and payable, subject to proration in accordance with Section 7 hereof;
(e)    any laws, rules, regulations, statutes, ordinances, orders or other legal requirements affecting the Premises, including, without limitation, all zoning, land use, building and environmental laws, rules, regulations, statutes, ordinances, orders or other legal requirements, including landmark designations and all zoning variance and special exceptions, if any; 
(f)    to the extent shown in the Reports, all covenants, restrictions and utility company rights, easements and franchises relating to electricity, water, steam, gas, telephone or other service or the right to use and maintain poles, lines, wires, cables, pipes, boxes and other fixtures and facilities in, over, under and upon the Premises, provided that, in the case of any of the foregoing items which shall not be of record, the same do not materially adversely affect the present use of the Premises;
(g)    any installment not yet due and payable of assessments imposed after the Effective Date and affecting the Premises or any portion thereof;
(h)    all Violations (as hereinafter defined) now or hereafter issued or noted; 
(i)    the rights and interests held by tenants under the Leases in effect at the Closing as tenants only without an option to purchase all or any portion of the Properties (any non-disturbance agreements and memorandum of lease relating thereto); 
(j)    the Operating Leases (as defined on Schedule N attached hereto);
(k)    possible encroachments and/or projections of stoop areas, roof cornices, window trims, vent pipes, cellar doors, steps, columns and column bases, flue pipes, signs, piers, lintels, window sills, fire escapes, satellite dishes, protective netting, sidewalk sheds, ledges, fences, coping walls (including retaining walls and yard walls), air conditioners and the like, if any, on, under, or above any street or highway, the Premises or any adjoining property; and
(l)    all other matters which, pursuant to the terms of this Agreement, are deemed Permitted Encumbrances.
		
	6.
	TITLE INSURANCE; LIENS.

(a)    (i)    The Parties acknowledge that Purchaser has reviewed the title reports for the Properties (together with all instruments set forth therein, each individually a "Report" and collectively, the "Reports"), obtained from Nick DeMartini of Fidelity National Title Insurance Company (the "Title Company") for an owner's policy of title insurance with respect to the Premises).  

	
			
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At the Closing, Purchaser shall obtain title insurance from the Title Company, as "lead insurer," provided, that, at Purchaser's option, Purchaser may direct that one or more other national title insurance companies, as co-insurers, provide up to fifty percent (50%) of the owner's and lender's insurance coverage.
(ii)    The Parties acknowledge that Purchaser has received the Surveys and the Reports. 
(iii)    Intentionally Omitted. 
(iv)    Purchaser shall direct the Title Company to deliver a copy of any update or continuation to the Report to Seller simultaneously with its delivery of the same to Purchaser.  If, prior to the Closing Date, the Title Company shall deliver any update to the Report or Survey which discloses additional liens, encumbrances or other title exceptions or other matters which were not disclosed by the Report and are not Disclosed Survey Items and which do not otherwise constitute Permitted Encumbrances hereunder (each, an "Update Exception"), then Purchaser shall have until the earlier (the "Objection Period") of (x) five (5) business days after delivery of such update to Purchaser or its counsel or (y) the Closing Date, time being of the essence (the "Update Objection Deadline") to deliver written notice to Seller objecting to any of the Update Exceptions (the "Title Objections").  If Purchaser fails to deliver such objection notice by the Update Objection Deadline, Purchaser shall be deemed to have waived its right to object to any Update Exceptions (and the same shall not constitute Title Objections, but shall instead be deemed Permitted Encumbrances).  If Purchaser shall deliver such objection notice by the Update Objection Deadline, any Update Exceptions which are not objected to in such notice shall not constitute Title Objections, but shall be Permitted Encumbrances.
(v)    Purchaser shall not be entitled to object to, and shall be deemed to have approved, any liens, encumbrances or other title exceptions (and the same shall not constitute Title Objections, but shall instead be deemed to be Permitted Encumbrances) (A) against which the Title Company is willing to provide affirmative insurance (without additional cost to Purchaser or where Seller pays such cost for Purchaser) acceptable to Purchaser in its reasonable discretion, or (B) which will be extinguished of record upon the transfer of the Properties (collectively, the "Non-Objectionable Encumbrances").  Notwithstanding anything to the contrary contained herein, if Seller is unable to eliminate (i.e., remove of record) the Title Objections by the Scheduled Closing Date (as hereinafter defined), unless the same are waived by Purchaser without any abatement in the Purchase Price, Seller may, upon at least two (2) business days' prior notice to Purchaser (except with respect to matters first disclosed during such two (2) business day period, as to which matters notice may be given at any time through and including the Scheduled Closing Date) adjourn the Scheduled Closing Date (such date to which Seller adjourns the Scheduled Closing Date is the "Adjourned Closing Date"), for a period not to exceed ninety (90) days (the "Title Cure Period"), in order to attempt to eliminate (i.e., remove of record) such exceptions.  

	
			
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(b)    If a Seller is unable to eliminate (i.e., remove of record) any Title Objection with respect to an Individual Property (an "Affected Individual Property") prior to the Closing (or within the Title Cure Period if applicable), then, except as provided below in this clause (b), unless the same is waived by Purchaser, Purchaser may (i) accept the Affected Individual Property subject to such Title Objection without abatement of the Purchase Price, in which event (x) such Title Objection shall be deemed to be, for all purposes, a Permitted Encumbrance, (y) Purchaser shall close hereunder notwithstanding the existence of same, and (z) such Seller shall have no obligations whatsoever after the Closing Date with respect to such Seller's failure to cause such Title Objection to be eliminated, or (ii) terminate this Agreement with respect to the Affected Individual Property only, by notice given to such Seller within two (2) business days following expiration of the Title Cure Period or Response Period (as hereinafter defined), as applicable, time being of the essence in which event the Purchase Price shall be reduced by an amount equal to the portion of the Purchase Price allocated to the Affected Individual Property as shown on Schedule B-1).  If Purchaser shall fail to deliver the termination notice described in clause (ii) within the two (2) business day period described therein, time being of the essence, Purchaser shall be deemed to have made the election under clause (i) above.  Upon the timely giving of any termination notice under clause (ii), as of the Closing, the Properties that are the subject of such termination notice shall no longer be deemed to include the Affected Individual Property and same shall be conveyed out or distributed to the existing members of the Transferred Entities in accordance with the terms of the applicable Operating Agreement so that same are not owned by a JV Entity or Transferred Entity at the time of the Closing (such act of conveyance or distribution, an "Elimination"), this Agreement shall be deemed canceled and of no further force or effect with respect to such Affected Individual Property only, and no party hereto shall have any further rights or obligations hereunder with respect to such Affected Individual Property, except those arising under provisions of this Agreement that expressly survive the termination hereof.  In the event that Purchaser gives Seller notice of any Title Objections, then no later than the earlier to occur of (the "Response Period") (x) five (5) business days after Seller receives such Title Objections, or (y) the date prior to the Scheduled Closing Date (unless notice of such Title Objections is given by Purchaser on the Scheduled Closing Date in which event the Response Period shall expire on the Scheduled Closing Date), time being of the essence, Seller shall notify Purchaser whether or not it intends to eliminate (i.e., remove of record) the applicable matter (and (x) if Seller so notifies Purchaser that it will not eliminate (i.e., remove of record) the applicable matter, then Purchaser shall have the rights set above in this clause (b), or (y) if Seller so notifies Purchaser that it will so eliminate the applicable matter, and Seller does not do so, then Purchaser has the continuing right to (i) accept the Affected Individual Property subject to such Title Objection without abatement of the Purchase Price, in which event (x) such Title Objection shall be deemed to be, for all purposes, a Permitted Encumbrance, (y) Purchaser shall close hereunder notwithstanding the existence of same, and (z) such Seller shall have no obligations whatsoever after the Closing Date with respect to such Seller's failure to cause such Title Objection to be eliminated, or (ii) terminate this Agreement with respect to such Affected Individual Property and the same shall be conveyed out or distributed at or prior to the Closing in the manner set forth above and, by notice given to such Seller within two (2) business days' following the expiration of the Title Cure Period or Response Period, as applicable, time being of the essence in which event the Purchase Price shall be reduced by an amount equal to the portion of the Purchase Price allocated to the Affected Individual Property as shown on Schedule B-1).

	
			
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(c)    It is expressly understood that in no event shall Seller be required to bring any action or institute any proceeding, or to otherwise incur any costs or expenses in order to attempt to eliminate any Title Objections, or take any other actions to cure or remove any Title Objections, or to otherwise cause title in the Premises to be in accordance with the terms of this Agreement on the Closing Date.  Notwithstanding anything in this Section 6 or any other provision hereof to the contrary, but subject in all respect to Purchaser's obligation to pay one hundred percent (100%) of the Spread Maintenance Payment as set forth in Section 4(d) above, without Purchaser having to send any Title Objections or other written notice thereof, Sellers shall be required to remove, by payment, bonding or otherwise (but in all events deletion of the applicable matter from Purchaser's title insurance policies): (i) any mortgage or other lien granted by any Seller, any JV Entity, any Transferred Entity, any Individual Owner or Operating Lessee which secures indebtedness for borrowed money (and, with regard thereto, at the Closing Sellers shall be required to ensure (x) that the Existing Mortgage Debt is paid off in full; (y) that the Existing Mezzanine Financing or similar debt relating to the JV Entities and Transferred Entities are paid off in full and all documents evidencing the same removed from the public record as evidenced by UCC-3 terminations; and (y) the Transferred Interests and the JV Interests are otherwise fee of liens, encumbrances and other rights or claims including, without limitation, liens or security interests in respect of the Existing Financing), (ii) any Title Objections which have been voluntarily recorded or otherwise placed by Seller against the Properties on or following the Effective Date (other than with the approval of Purchaser), or (iii) any Title Objections which would not fall within the definition of clauses (i) or (ii) above and which can be removed by the payment of a liquidated sum of money; provided, however, that with respect to such items set forth in this clause (ii), in no event shall Seller be obligated to expend amounts in excess of $500,000 for any Individual Property or in excess of $5,000,000 in the aggregate for all of the Properties pursuant to the provisions of this sentence. 
(d)    If Seller shall have adjourned the Scheduled Closing Date in order to cure Title Objections in accordance with the provisions of this Section 6, Seller shall, upon the satisfactory cure thereof in accordance with this Section 6, promptly reschedule the Scheduled Closing Date as soon as possible, upon at least five (5) business days' prior notice to Purchaser (the "New Closing Notice"); it being agreed, however, that if any Title Objections arise between the date the New Closing Notice is given and the rescheduled Scheduled Closing Date, Seller may again adjourn the Closing for a reasonable period or periods, in order to attempt to cause such exceptions to be eliminated subject to the other provisions of this Section 6 as applicable thereto; provided, however, that Seller shall not be entitled to adjourn the new Scheduled Closing Date pursuant to this Section 6 for a period or periods in excess of ninety (90) days in the aggregate. 
(e)    If the Reports or any update of the Reports disclose judgments, bankruptcies or other returns against other persons having names the same as or similar to that of any Individual Owners or an Operating Lessee, on request,  Sellers shall deliver to the Title Company affidavits showing that such judgments, bankruptcies or other returns are not against such Individual Owners or Operating Lessees in order to request the Title Company to omit exceptions with respect to such judgments, bankruptcies or other returns or to insure over same.  Purchaser acknowledges that certain Chapter 11 bankruptcy proceeding of Innkeepers USA Trust, together with certain of its affiliates, including Individual Owners (other than Grand Prix Rockville Subsidiary LLC), was 

	
			
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filed on July 19, 2010 in the United States Bankruptcy Court for the Southern District of New York which proceeding has been resolved and closed pursuant to a final non-appealable order of the United States Bankruptcy Court for the Southern District of New York. 
(f)    Purchaser agrees to purchase the Transferred Interests notwithstanding that the Properties may be subject to any and all notes or notices of violations of law, or municipal ordinances, orders, designations or requirements whatsoever noted in or issued by any federal, state, municipal or other governmental department, agency or bureau or any other governmental authority having jurisdiction over the Premises (collectively, "Violations"), or any condition or state of repair or disrepair or other matter or thing, whether or not noted, which, if noted, would result in a Violation being placed on the Premises.  Seller shall have no duty to remove or comply with or repair any condition, matter or thing whether or not noted, which, if noted, would result in a violation being placed on the Premises, Seller shall have no duty to remove or comply with or repair any of the aforementioned Violations, or other conditions, and Purchaser shall accept the Premises subject to all such Violations, the existence of any conditions at the Premises which would give rise to such Violations, if any, and any governmental claims arising from the existence of such Violations, in each case without any abatement of or credit against the Purchase Price.  Notwithstanding the foregoing, the provisions of this clause (f) shall not limit or modify any of the other provisions of this Agreement that expressly provide for obligations of a Party that contradict with the terms of this clause (f) (including, without limitation, Section 9(a)(i) below).
		
	7.
	APPORTIONMENTS.

(a)    Closing Statement.  No later than the business day immediately preceding Closing, Purchaser and each Seller, through their respective employees, agents or representatives, jointly shall have concluded  such examinations, audits and inventories of the Properties as may be necessary to make the adjustments and prorations to the Purchase Price as set forth in Sections 7(b) and 7(c) or any other provisions of this Agreement on an Individual Property basis (i.e., a separate closing statement for each Individual Property and a single consolidated statement).  Based upon such examinations, audits and inventories, the Parties jointly shall prepare prior to Closing a closing statement (the "Closing Statement"), which shall set forth their best estimate of the amounts of the items to be adjusted and prorated under this Agreement. The Closing Statement shall be approved and executed by the Parties at Closing.  Notwithstanding the foregoing, if at any time within one hundred and eighty (180) days after the Closing Date, any Party discovers any item which was omitted or incorrectly adjusted or prorated in the Closing Statement, such item shall be adjusted and prorated in the same manner as if their existence or such error had been known at the time of the preparation of the Closing Statement, and the Party in whose favor such original omission or error was made shall refund such difference to the other Party promptly after the original omission or error is discovered. 
(b)    Prorations.  Except as otherwise provided herein, the items of revenue and expense set forth in this Section 7(b) shall be prorated between the Parties (the "Prorations") as of 11:59 p.m. on the day preceding the Closing Date (the "Cut-Off Time"), or such other time expressly provided in this Section7(b), so that the Closing Date is a day of income and expense for Purchaser. 

	
			
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(i)    Property Level Taxes.  All real property, personal property, and similar Property Level Taxes that accrue during the taxable period during which the Closing Date occurs (and, to the extent unpaid, any previous taxable period) shall be prorated as of the Cut-Off Time between Sellers and Purchaser based on the number of days in the applicable tax year during which the applicable Party indirectly owned the applicable Individual Property. If the amount of any such Property Level Taxes is not ascertainable on the Closing Date, the proration for such Taxes shall be based on the most recent available bill; provided, however, that (i) after the Closing, Sellers and Purchaser shall reprorate the Property Level Taxes with respect to 2014 and pay any deficiency in the original proration to the other Party promptly upon receipt of the actual bill for the relevant taxable period, such adjustment to be completed, and payment made (if applicable) within thirty (30) days following such receipt, and (ii) Sellers shall be entitled to receive any refunds or other amounts payable to the owner of an Individual Property due to an overpayment of Property Level Taxes attributable to any period prior to the Closing.  Notwithstanding the foregoing, any supplemental Taxes relating to any period from and after the Closing Date that arise from and out of the change in ownership of the JV Entities shall be the sole responsibility of Purchaser and shall be paid by Purchaser when due and payable.  "Property Level Taxes" means any state or local real property, personal property, sales, use, room, occupancy, ad valorem or similar taxes, assessments, levies, charges or fees imposed by any governmental authority on an Individual Owner with respect to the Properties or the Business, including, without limitation, any interest, penalty or fine with respect thereto, but expressly excluding any (i) federal, state, local or foreign income, capital gain, gross receipts, capital stock, franchise, profits, estate, gift or generation skipping tax, or (ii) transfer, documentary stamp, sales, recording or similar tax, levy, charge or fee incurred with respect to the transaction described in this Agreement. 
(ii)    Rents.  Any rents and other amounts prepaid under the Leases shall be prorated as of the Cut-Off Time between Sellers and Purchaser. The JV Entity entitled to hold any security deposits through such Leases shall continue to hold same after the Closing.  For a period of one hundred eighty (180) days following the Closing Date, Purchaser shall cause the applicable Individual Owner to bill tenants owing Rents for periods prior to the Closing Date, on a monthly basis and Purchaser shall use commercially reasonable efforts to collect past due Rents from tenants owing Rents for periods prior to the Closing Date; provided, however, that Purchaser shall have no obligation to cause the termination of any Lease as a result of its failure to collect any such past due Rents, declare a default or commence litigation.  Rents collected by Purchaser or an Individual Owner after the Closing Date to which a Seller is entitled pursuant to this Agreement shall be paid to such Seller within five (5) business days' after receipt thereof by Purchaser.   If any Seller receives any rents or other payments relating to any Property after the Closing, such Seller shall hold the balance of same in trust for Purchaser and immediately deliver the same to Purchaser for application in accordance with the terms hereof.  No Seller shall commence any litigation against, or assert any claim against, any tenant at any of the Properties after the Closing.  "Rents" means all Base Rents, Overage Rent, and Additional Rent.  "Base Rents" means monthly base rents and parking charges under the Leases.  "Overage Rent" means additional or escalation rent based upon (A) a percentage of a tenant's gross sales during a specified 

	
			
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annual or other period or (B) increases in real estate taxes, operating expenses, labor costs, cost of living indices or porter's wages.  "Additional Rent" means items of rent or charges which are not Base Rents or Overage Rents, such as charges for electricity, steam, water, cleaning, overtime services, sundry charges or other charges of a similar nature. Any Rents collected by any JV Entity from and after the Closing Date from tenants who owe Rents for periods prior to the Closing Date, shall be applied (unless otherwise specifically specified by the applicable tenant), (A) first, in payment of Rents for the calendar month in which the Closing Date occurs; (B) second, in payment of Rents for the calendar month immediately preceding the Closing Date; (C) third, in payment of Rents for all periods following the Closing Date; and (D) fourth, in payment of Rents for periods prior to the Closing Date and not paid pursuant to (B) above.  Each such amount, less reasonable collection costs, shall be adjusted and prorated as provided above, and the party receiving such amount shall, within five (5) business days, pay to the other party the portion thereof to which it is so entitled.
(iii)    Contracts.  Any amounts prepaid, accrued or due and payable under the Contracts (other than for utilities which proration is addressed separately in Section 7(b)(v)) shall be prorated as of the Cut-Off Time between Sellers and Purchaser, with Sellers being credited for amounts prepaid, and Purchaser being credited for amounts accrued and unpaid.  Each Seller shall receive a credit for all deposits under the Contracts (together with any interest thereon) which are transferred to Purchaser in accordance with the terms of this Agreement or remain on deposit for the benefit of Purchaser.
(iv)    Licenses and Permits.  All amounts prepaid, accrued or due and payable under the Licenses and Permits shall be prorated as of the Cut-Off Time between Sellers and Purchaser.  Each Seller shall receive a credit for all deposits under the Licenses and Permits (together with any interest thereon) which are transferred to Purchaser or which remain on deposit for the benefit of Purchaser.
(v)    Utilities.  All utility services shall be prorated as of the Cut-Off Time between Sellers and Purchaser. The Parties shall use commercially reasonable efforts to obtain readings for all utilities as close in time as possible to the Cut-Off Time.  If readings cannot be obtained as of the Closing Date, the cost of such utilities shall be prorated between Sellers and Purchaser by estimating such cost on the basis of the most recent bills for such services; provided, however, that after the Closing, the Parties shall reprorate the amount for such utilities and pay any deficiency in the original proration to the other Party promptly upon receipt of the actual bill for the relevant billing period, which obligation shall survive the Closing. Each Seller shall receive a credit for all fuel stored at the Properties based on the actual cost for such fuel as reflected on the last invoice therefor.  Sellers shall receive a credit for all deposits transferred to Purchaser or which remain on deposit for the benefit of Purchaser with respect to such utility contracts.
(vi)    Bookings.  Purchaser shall receive a credit for all prepaid deposits and advance payments for Bookings scheduled to occur on or after the Closing Date, except to the extent such deposits are transferred to Purchaser. 
(vii)    Intentionally Omitted. 

	
			
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(viii)    Restaurants, Bars and Function Rooms.  Sellers shall cause to be closed out the transactions in the restaurants and bars in the Properties as of the regular closing time for such restaurants and bars operated by or on behalf of each Operating Lessee during the night in which the Cut-Off Time occurs and retain all monies collected as of such closing, and Purchaser (indirectly through the Operating Lessees) shall be entitled to any monies collected from the restaurants and bars thereafter.  Purchaser shall receive a credit at Closing for all revenues received by any Operating Lessee prior to the Closing Date but attributable to the period of time after the Cut-Off Time from conferences, receptions, catering activities, meeting and other functions held or conducted in conference rooms, banquet rooms, meeting rooms, or in any other Individual Property facility and adjacent facilities owned or operated by any Individual Owner (including without limitation usage charges and related taxes, food and beverage sales, parking charges, equipment rental and telecommunications charges) attributable to any of the foregoing (the "Property Facility Revenue") to the extent they occur after the Cut-Off Time.  To the extent not adjusted in accordance with Section 7(c) below, any Property Facility Revenue received by Purchaser after Closing, but attributable to the period prior to the Cut-Off Time, shall be paid by Purchaser to Seller promptly upon receipt.  This Section 7(b)(viii) shall survive the Closing. 
(ix)    Vending Machines.  To the extent owned by an Operating Lessee, prior to Closing, Sellers shall cause to be removed all monies from all vending machines, laundry machines, pay telephones and other coin operated equipment as of the Cut-Off Time and shall retain all monies collected therefrom as of the Cut-Off Time, and to the extent assigned to Purchaser pursuant to this Agreement, Purchaser shall be entitled to any monies collected therefrom after the Cut-Off Time.
(x)    Trade Payables.  Except to the extent an adjustment or proration is made under another subsection of this Section 7(b), (i) prior to Closing, Sellers shall cause to be paid in full prior to Closing, all amounts payable to vendors or other suppliers of goods or services for the Business or otherwise relating to the Properties (the "Trade Payables"), and (ii) Purchaser shall receive a credit for the amount of such Trade Payables which have accrued, but are not yet due and payable as of the Closing Date to the  extent the same relates to a Contract to be retained by Purchaser pursuant to this Agreement, and Purchaser shall pay all such Trade Payables accrued on and after the Closing Date when such Trade Payables become due and payable to the extent the same relates to a Contract to be retained by Purchaser pursuant to this Agreement; provided, however, Sellers and Purchaser shall reprorate the amount of credit for any Trade Payables and pay any deficiency in the original proration to the other Party promptly upon receipt of the actual bill for such goods or services. Sellers shall not receive any  credit for any advance payments or deposits made with respect to, or otherwise with respect to the value or cost of FF&E, Supplies, F&B and Retail Merchandise ordered or at the Properties.  
(xi)    Cash.  Sellers shall receive a credit for all cash on hand or on deposit in any house bank at the Properties to the extent same shall remain on deposit for the benefit of Purchaser. In addition, for the avoidance of doubt, notwithstanding anything to the contrary contained in this Agreement, Sellers shall be entitled to retain any cash reserves 

	
			
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or escrows held by any lender in respect of the Existing Financing and shall be entitled to cause the distribution of all cash and deposits in any house bank (other than security deposits) to, or for the benefit of, the respective owner of the Transferred Entities immediately prior to the Closing and Purchaser shall have no right to, or interest in any such cash.
(xii)    Franchise Agreements.  To the extent applicable, any amounts accrued or due and payable to the applicable Franchisor under the Franchise Agreements to the extent such amounts have not been retained by Franchisor to set off against such amounts due to Franchisor by the JV Entities, shall be prorated as of the Cut-Off Time between Seller and Purchaser.  For purposes of this Agreement, "Franchise Agreements" shall mean those Franchise Agreements set forth on Schedule C attached hereto.  For purposes of this Agreement, "Franchisors" shall mean each franchisor under the Franchise Agreements. 
(xiii)    Management Agreements.  At or before Closing, Sellers shall cause the JV Entities to pay to the Manager all amounts due and owing to Manager under the Management Agreements through the Cut-Off Time and the JV Entities shall be responsible for all payments to Manager from and after the Cut-Off Time.
(xiv)    Other Adjustments and Prorations.  All other items of income and expense as are customarily adjusted or prorated upon the sale and purchase of a hotel property similar to the Properties (and direct and indirect equity interests in the owners thereof) shall be adjusted and prorated between Sellers and Purchaser accordingly. In the event complete information is not available or estimates have been utilized to calculate Prorations as of the Closing Date, any such Prorations shall be further adjusted between Sellers and Purchaser within one hundred and eighty (180) days after the Closing Date.  Any adjustments to initial estimated Prorations which are required upon review of such complete information within such period shall be made by Sellers and Purchaser, with due diligence and cooperation, by prompt cash payment to the party entitled to a credit as a result of such adjustments. Any errors or adjustments in calculating the foregoing adjustments and Prorations shall be corrected or adjusted as soon as practicable within the one hundred and eighty (180) day period after the Closing.  All such adjustments and prorations to be performed under this clause (b) shall be done on a net cash basis (e.g., prorations shall be made based on actual cash receipts after deducting commissions (credit cards or otherwise) or other payments that may be due to third parties).  Notwithstanding anything to the contrary contained herein, the obligations and liabilities of the Parties (and the provisions) set forth under this clause (b) shall survive the Closing for one hundred eighty (180) days.
(c)    Accounts Receivable. 
(i)    Guest Ledger.  At Closing, Sellers shall receive a credit in an amount equal to: (i) all amounts charged to the Guest Ledger (as hereinafter defined) for all room nights up to (but not including) the night during which the Cut-Off Time occurs, and (ii) one half (1⁄2) of all amounts charged to the Guest Ledger for the room night which includes the Cut-Off Time (other than any restaurant or bar charges on the Guest Ledger which shall be prorated in accordance with Section 7(b)(viii)), and Purchaser shall be entitled to retain all deposits made and amounts collected with respect to such Guest Ledger.  For 

	
			
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purposes of this Agreement, "Guest Ledger" means all charges accrued to the open accounts of any guests or customers at the Properties as of the Cut-Off Time for the use or occupancy of any guest, meeting, conference or banquet rooms or other facilities at the Properties, any restaurant, bar or banquet services, or any other goods or services provided by or on behalf of any Operating Lessee at the Properties.
(ii)    Accounts Receivable (Other than Guest Ledger).  At Closing, Sellers shall receive a credit for all Accounts Receivable (other than the Guest Ledger which is addressed in Section 7(c)(i)) that are not more than ninety (90) days past due on the Closing Date and a credit equal to fifty percent (50%) of all Accounts Receivable that are more than ninety (90) days but not more than 180 days past due on the Closing Date, and Purchaser shall be entitled to all amounts collected for all Accounts Receivable.  For purposes of this Agreement, "Accounts Receivable" means all amounts which any Operating Lessee is entitled to receive from the Business which are not paid as of the Closing, including, without limitation, charges for the use or occupancy of any guest, meeting, conference or banquet rooms or other facilities at the Properties, any restaurant, bar or banquet services, or any other goods or services provided by or on behalf of any Operating Lessee at the Properties, but expressly excluding all items of income otherwise prorated pursuant to Section 7(b) or 7(c)(i).  For purposes of this Agreement, "Business" means the lodging business and all activities related thereto conducted at the Properties, including, without limitation, (i) the rental of any guest, meeting, conference or banquet rooms or other facilities at the Properties, (ii) the operation of any restaurant, bar or banquet services, together with all other goods and services provided at the Properties, (iii) the rental of any commercial or retail space to tenants at the Properties, (iv) the maintenance and repair of the Properties and tangible personal property, (v) the employment of the Individual Property employees, and (vi) the payment of Taxes. All such adjustments and prorations to be performed under this clause (c) shall be done on a net cash basis (e.g., prorations shall be made based on actual cash receipts after deducting commissions (credit cards or otherwise) or other payments that may be due to third parties).
		
	8.
	PROPERTY NOT INCLUDED IN SALE.

Notwithstanding anything to the contrary contained herein, it is expressly agreed by the Parties hereto that any fixtures, furniture, furnishings, equipment or other personal property (including, without limitation, trade fixtures, pictures, paintings, prints and drawings, sculptures, tapestries or other items of art in, on, around or affixed to the Building) owned or leased by any tenant, other than a tenant under the Operating Leases (collectively, "Excluded Personalty"), shall not be included in the Properties to be  indirectly sold to Purchaser hereunder. Other than the Excluded Properties, no other portion of the Properties may be removed therefrom without the consent of Purchaser.
		
	9.
	COVENANTS OF SELLER AND PURCHASER.

(a)    By their execution hereof, the Individual Owners and Operating Lessees agree that during the period from the Effective Date until the Closing Date or earlier termination of this Agreement with respect to the then applicable Individual Property, JV Entity or 

	
			
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Transferred Entity, as applicable, they shall, and Sellers shall, or shall cause the Manager to, in each case to the extent within their power and control (Purchaser acknowledges and agrees that Chatham LP and Manager run the day-to-day operations at the Properties); provided, however, if Chatham LP or any of its Affiliates is the Purchaser of the Specified Hotels, it shall not be a condition precedent to Closing that Seller comply with any of the covenants of Seller set forth in this Section 9(a) (to the extent such covenants specifically relate to Individual Properties) with respect to the Specified Hotels: 
(iii)    except as otherwise provided in this Agreement, conduct the Business in the Ordinary Course of Business, and shall cause the Manager to operate the Properties in the Ordinary Course of Business.  For purposes of this Agreement, "Ordinary Course of Business" means the ordinary course of business consistent with Sellers' past custom and practice for the Business, taking into account the facts and circumstances in existence from time to time, except that Seller shall not be required to make (or cause to be made) any capital improvements or replacements to the Properties other than (x) as expressly provided herein, (y) standard maintenance and other work needed to keep the Properties in good order and repair, and (z) such work as is necessary to prevent threat of harm to persons or property (each of which shall be at Sellers' cost);
(iv)    use commercially reasonable efforts to comply with its obligations, if any, under Contracts, Leases, Ft. Lauderdale Ground Lease and the Union Contract and to enforce the obligations of the applicable third parties thereunder; 
(v)    from time to time as reasonably requested by Purchaser but not more than one time each calendar month, deliver to Purchaser, updated balance sheets, rent rolls, income statements and other financial statements with respect to the Transferred Entities, the JV Entities and/or the Properties.
(vi)    keep in force and effect all material Permits and Licenses;
(vii)    not perform any material alterations to any Properties, except for ongoing improvements and renovations in the Ordinary Course of Business; 
(viii)    provide to Purchaser and its financing sources all books and records reasonably requested by Purchaser that relate to any Individual Property or the Properties (or any of the Transferred Interests, Transferred  Entities, JV Interests or JV Entities) and otherwise reasonably cooperate with Purchaser's and its financing sources' due diligence and other examinations and inspections  of the Properties and the applicable entities and their efforts to obtain the financing necessary to consummate the Closing;
(ix)    without Purchaser's prior written consent, not remove or permit the removal from the Premises any article of FF&E, except as may be necessary for repairs, or the discarding of worn out FF&E which is replaced with substantially the same FF&E;

	
			
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(x)    without Purchaser's prior written consent, not permit there to be initiated, consented to, approved or otherwise taken any action with respect to the zoning, or any other governmental rule or regulation, presently applicable to all or any part of the Properties;
(xi)    maintain in full force and effect the insurance policies currently in effect with respect to the Properties and cause all applicable carriers to confirm that the Individual Owners remain fully covered thereunder after the Closing notwithstanding the change of ownership and control caused by the transactions contemplated by this Agreement.  At the Closing, complete copies of all such policies shall be provided to Purchaser;
(xii)    not sell, transfer, assign, encumber or change the status of title of all or any portion of the Properties, the Transferred Interests or the JV Interests (or amend or terminate any of the documents relating to the same); 
(xiii)    not subject (x) the Transferred Interests or the JV Interests to any additional liens, encumbrances or other rights or claims, (y) the Properties to any material liens (without limiting Purchaser's right to submit Title Objections under Section 6 in respect of any types of liens, whether or not the same is material), or (z) the Properties, the Transferred Interests or the JV Interests to any encumbrances, covenants or easements or other rights or claims;
(xiv)    promptly following receipt thereof, provide Purchaser with a copy of all material written notices or correspondence received or delivered by Seller (or any Individual Owner, JV Entity or Transferred Entity) including, without limitation notices or correspondence (A) to or from any Franchisor, (B) to or from any counterparty to any Contract, (C) to or from any union or Hotel Employees with respect to the Union Contracts, (D) with respect to any litigation or proceeding (pending or threatened) which affects the any Individual Property, JV Entity, Transferred Entity or Individual Owner, or (E) from a governmental authority which alleges or asserts a violation of law by or relating to the Premises;
(xv)    in connection with obtaining the consent of the Franchisors, Seller shall use commercially reasonable efforts to cooperate with Purchaser in seeking such consent; 
(xvi)    not, without Purchaser's prior written consent, (i) amend, extend, renew or terminate any existing Contracts or Leases, nor (ii) enter into any Leases or Contracts (or take any other action that would bind, Purchaser, a JV Entity or a Transferred Entity after the Closing), unless as to such Leases or Contracts the same are terminable by Purchaser without any termination fee upon not more than thirty (30) days' notice (provided that if any termination fee is owed (or there is any cost or charge during such 30-day  termination period), Sellers shall pay such fee, costs and charges at or before the Closing);

	
			
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(xvii)    not enter into any new union contracts or agreements with any Hotel Employees (or, terminations, extensions or amendments to any of the foregoing) at the Premises which would be the responsibility of Purchaser or the JV Entities or Transferred Entities from and after the Closing, or make any changes to the salary or other benefits payable to any Hotel Employee, in each case, except in the ordinary course or as required by such agreement or applicable law and except for termination of Hotel Employees, without first obtaining Purchaser's written consent of the proposed action;
(xviii)    obtain the approval of Purchaser with regard to any actions to be taken in any pending or threatened litigation, proceeding or arbitration (including, without limitation, the defense thereof) that is likely to materially and adversely affect any of the Properties, any of the Transferred Entities or the JV Entities;
(xix)    maintain the existence and good standing of the Transferred Entities and the JV Entities in the state of Delaware and all other states where such entity conducts business;
(xx)    after and prior to the Closing permit Purchaser and its auditors and other representatives to audit the books and records of the Transferred Entities and the JV Entities (which obligation shall, solely to the extent in Sellers' possession or exclusive control, survive the Closing for a period of six (6) years and one (1) month); 
(xxi)    without Purchaser's prior written consent, which consent may be granted or withheld in Purchaser's sole and absolute discretion, not cause or permit any of the Transferred Entities and the JV Entities to engage in any business other than the ownership of the Properties and the Business, as applicable;
(xxii)    without Purchaser's prior written consent, which consent may be granted or withheld in Purchaser's sole and absolute discretion, not amend or otherwise alter or permit any of the Transferred Entities and the JV Entities to amend or otherwise alter their respective certificate of formation, limited liability company operating agreement, or other organizational documents or issue (or agree to issue) any securities or equity interests (or securities convertible into or that otherwise give any person the right to acquire equity interests) in any of such entities, as applicable; 
(xxiii)    without Purchaser's prior written consent, which consent may be granted or withheld in Purchaser's sole and absolute discretion, not cause or permit the sale, mortgage, pledge, hypothecation or other transfer or disposal of all or any part of the Transferred Interests, JV Interests, any Individual Property or any interest therein(or enter into any agreement, negotiate with respect to, or market any of the foregoing);
(xxiv)    if requested by Purchaser, the applicable JV Entities shall request estoppel certificates and "SNDAs" from tenants under Leases, provided that delivery of any such estoppel certificates and "SNDAs shall not be a condition precedent to Closing and shall impart no liability whatsoever upon Sellers;

	
			
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(xxv)    without Purchaser's prior written consent, not engage in  and shall not permit any of the JV Entities or Transferred Entities to engage in (i) any transaction or take any action other than in the Ordinary Course of Business; or (ii) the commencement of any litigation, arbitration or governmental proceedings (other than Tax Certiorari Proceedings (as hereinafter defined)).  In the event that any such liabilities or obligations are created in violation of this Agreement, then Purchaser may offset the amount of such liability or obligation against any amount payable to Sellers under any other provision of this Agreement; 
(xxvi)    not take any action which would encumber the ownership of the JV Interests or Transferred Interests; 
(xxvii)    not make, rescind, or revoke any income Tax election, settle or compromise any income Tax liability, or amend any income Tax Return which will have a material impact on Purchaser; and
(xxviii)    request and use commercially reasonable efforts to obtain an estoppel certificate from the Ground Lessor substantially in the form attached hereto as Exhibit 4 (subject to (i) non-material modifications thereof, (ii) modifications thereof to conform the same to the Fort Lauderdale Ground Lease and (iii) limiting its statements "to knowledge" (or words of similar import)); provided, however, that if Ground Lessor is required or permitted under the terms of the Fort Lauderdale Ground Lease to provide a different form of estoppel, less information or to otherwise make different statements in a certification of such nature than are set forth on Exhibit 4, then Purchaser shall accept any modifications made to such form of estoppel certificate to the extent that such modifications to the form are consistent with the minimum requirements set forth in the Fort Lauderdale Ground Lease (it being understood by Purchaser that Ground Lessor shall not be required to make any certifications not specifically enumerated in the Fort Lauderdale Ground Lease estoppel requirements even if the Fort Lauderdale Ground Lease requires the Ground Lessor to certify to any additional items "reasonably requested") (any such estoppel certificate complying with this clause (xxvi) that does not (1) describe a material default of a material obligation by lessee under the Fort Lauderdale Ground Lease, or (2) reflect an inconsistency of a material term in the Ground Lease as compared to the copy of the Ground Lease contained in the Datasite is a "Ground Lease Estoppel Certificate").
(b)    If this Agreement is still in full force and effect following the expiration of the Due Diligence Period, then during the period from the expiration of the Due Diligence Period until the earlier to occur of the Closing Date and the earlier termination of this Agreement with respect to the then applicable Individual Property, Sellers shall, if requested by Purchaser, request and use good faith efforts to cause, to the extent permitted by applicable law or as is customary (but in all events in New York), that the current lender holding the Existing Mortgage Debt assign its current mortgages in the states where the same is permitted by law or customary to Purchaser's designated lender, provided that such assignment shall be (x) at Purchaser's sole cost and expense and (y) without recourse, representation or warranty.  Failure to so assign any such mortgage, however, shall not be a condition precedent to Closing and shall impart no liability 

	
			
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whatsoever upon Sellers.  If Purchaser's designated lender reasonably requires an estoppel certificate with respect to any covenant, condition and/or restriction affecting the title to any Individual Property, Sellers shall, at Purchaser's sole cost and expense, request the counterparty to such covenant condition and/or restriction to issue to such lender an estoppel certificate in form and substance reasonably satisfactory to such lender, provided, however, that the failure to obtain any such estoppel certificate shall not be a condition precedent to Closing and shall impart no liability whatsoever upon Sellers.
(c)    Sellers shall indemnify, defend and hold Purchaser, the JV Entities and the Transferred Entities (as constituted after the Closing), and their respective direct and indirect members, managers (including, without limitation, asset managers or property managers), partners, officers, directors, shareholders, employees, affiliates and their respective successors and assigns (collectively, the "Purchaser Indemnified Parties"), harmless from and against any and all Losses which any Purchaser Indemnified Party incurs arising out of or resulting from any claims due or arising out of death or injury to persons, or damage to the property of others, which were sustained prior to the Closing.
		
	10.
	TRANSFER; SECURITY DEPOSITS; CONDITIONS TO CLOSING.

(a)    Transfer.  On the Closing Date, by virtue of Purchaser's acquisition of the JV Entities and the Transferred Entities, through such entities Purchaser will indirectly acquire Sellers' right, title and interest in and to, among other things, the following: 
(i)    the leases, licenses and other occupancy agreements demising space at the Properties, whether written or oral, together with all amendments and modifications thereof and supplements, guaranties, side letters and other binding documentation relating thereto (collectively, the "Leases") as set forth on Schedule D attached hereto; the term Leases shall not include subleases, licenses and occupancy agreements entered into by tenants under the Leases) which are then in effect; 
(ii)    to the extent transferable with respect to the transactions described herein, the service, maintenance, supply and other agreements to which any Seller, JV Entity or Transferred Entity is a party relating to the operation of the Properties, together with all modifications and amendments thereof and supplements relating thereto (collectively, the "Contracts") which are then in effect, provided, however, Purchaser may direct Sellers to take action, prior to Closing, to terminate any of the Contracts which are terminable without any cost to the terminating party (or, if there is such a cost, to agree to pay the cost thereof when due and payable) (and, to the extent that the transfers described in this Agreement would violate any of the transfer, change in control or other provisions in any such Contracts, Sellers shall cooperate with Purchaser to obtain the consent of the applicable third party thereto (and if such consent cannot be obtained by Closing, Sellers shall cause such Contracts to be terminated at the Closing at Sellers' cost)); and
(iii)    the permits and licenses, if any, relating to the Properties and the other intangible personal property.

	
			
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(b)    Security Deposits.  Prior to the Closing, the Operating Lessees and Individual Owners agree that they shall (i) not apply any security deposits held under Leases in respect of defaults by tenants under the applicable Leases or for other reasons and (ii) return the security deposit of any tenant thereunder who in the good faith judgment of Sellers is entitled to the return of such deposit pursuant to the terms of its Lease or otherwise by law.  At the Closing, the applicable Operating Lessees and Individual Owners shall retain the security deposits (including any letter of credit as security under the Leases) and not returned to tenants as above provided, subject to the apportionment of administrative charges pursuant to Section 7 above. 
(c)    Conditions to Obligations of Seller.  The obligation of Sellers to effect the Closing shall be subject to the fulfillment or written waiver by Sellers at or prior to the Closing Date of the following conditions:
(i)    Representations and Warranties.  The representations and warranties of Purchaser contained in this Agreement shall be true and correct in all material respects as of the Closing Date, as though made at and as of the Closing Date.  For the avoidance of doubt, the Representation Update shall be disregarded for purposes of determining whether the condition in this Section 10(c)(i) has been satisfied.
(ii)    Performance of Obligations.  Purchaser shall have (x) paid the full balance of the Purchase Price pursuant to Section 17(b), and (y) executed, acknowledged (if applicable) and/or delivered all documents required to be executed, acknowledged (if applicable) and/or delivered by Purchaser hereunder on the Closing Date; and in all material respects performed all other obligations required to be performed by it under this Agreement on or prior to the Closing Date.
(iii)    Cerberus Releases.  The Cerberus Guarantors (as hereinafter defined) shall be released of all liabilities and obligations pursuant to documentation in form and substance reasonably acceptable to the Cerberus Guarantors under (i) those certain guaranties made as of October __, 2011 made by, among others, CRE-Ink TRS Holding Inc., CRE-Ink REIT Member, LLC, CRE-Ink Member II, Inc., CRE-Ink REIT Member IV, LLC, CRE-Ink REIT Member V, LLC, CRE-Ink REIT Member VI, LLC, and CRE-Ink REIT Member VII, LLC (collectively, the "CRE Guarantors") in favor of Marriott, and (ii) that certain letter agreement made as of October 27, 2011 by, among others, Cerberus Series Four Holdings, LLC (collectively with the CRE Guarantors, the "Cerberus Guarantors") in favor of Marriott.
(d)    Conditions to Obligations of Purchaser.  The obligations of Purchaser to effect the Closing shall be subject to the fulfillment (or written waiver by Purchaser) at or prior to the Closing Date of the following conditions:
(i)    Representations and Warranties.  The representations and warranties of each Seller contained in Section 11(d) and elsewhere herein shall be true and correct in all material respects as of the Closing Date, as though made at and as of the Closing Date. 

	
			
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(ii)    Performance of Obligations.  Sellers shall have in all material respects performed all obligations required to be performed by each Seller under this Agreement on or prior to the Closing Date.
(iii)    Title Insurance.  The Title Company shall be committed to issue to the Individual Owners a title insurance policy in the amount of the Purchase Price meeting the requirements of Section 6 above, effective as of the Closing, insuring that title to the Premises vests in Purchaser.
(iv)    Ground Lease Estoppel Certificate.  Sellers shall have delivered the Ground Lease Estoppel Certificate dated no later than thirty (30) days prior to the Closing Date, provided, however, if Purchaser elects to extend the Scheduled Closing Date pursuant to and in accordance with Section 18 below, then such 30-day period shall be increased by the amount of days by which Purchaser so extends the Scheduled Closing Date (i.e., if Purchaser extends the Scheduled Closing Date for ten (10) days, the Ground Lessor Estoppel shall be dated no later than forty (40) days prior to the Closing Date).  Purchaser shall have no right to object to the Ground Lease Estoppel Certificate which references a general conditional statement by Ground Lessor such as "we reserve all rights". 
(v)    Bankruptcy. There shall be no proceeding involving bankruptcy or creditors' rights pending or threatened (under any state, federal or local laws) relating to any Seller, any JV Entity or any Transferred Entity.
(e)    Failure of Condition.  If the conditions precedent to Sellers' obligations to effect the Closing are not satisfied as of the Scheduled Closing Date (and Sellers have not waived such unsatisfied conditions in writing), then Sellers may terminate this Agreement.  If the conditions precedent to Purchaser's obligation to effect the Closing (except with respect to the condition precedent set forth in Section 10(d)(iv) above) are not satisfied as of the Scheduled Closing Date (and Purchaser has not waived such unsatisfied conditions in writing), then Purchaser may terminate this Agreement, provided that Sellers may, if they so elect and without any abatement in the Purchase Price, adjourn the Scheduled Closing Date for a period or periods not to exceed ninety (90) days in the aggregate in order to attempt to effect the Closing.  If this Agreement is so terminated pursuant to this Section 10(e), then Purchaser shall (except to the extent Sellers are entitled to retain the Deposit under Section 20(a) or have made a claim against a portion thereof under Section 20(b)) be entitled to receive the Deposit (and all accrued interest thereon) and this Agreement shall be deemed canceled and of no further force or effect, and no Party hereto shall have any further rights or obligations hereunder, except those arising under provisions of this Agreement that expressly survive the termination hereof (without limiting Purchaser's remedies for any Seller's default to the extent expressly set forth herein, including, without limitation, any limitations set forth herein).  If the conditions precedent to Purchaser's obligation to effect the Closing set forth in Section 10(d)(iv) above are not satisfied as of the Scheduled Closing Date, Purchaser may (i) accept the Individual Property subject to the Fort Lauderdale Ground Lease (the "Ground Lease Property") without abatement of the Purchase Price, in which event (x) Purchaser shall close hereunder notwithstanding the failure of Sellers to deliver the Ground Lessor Estoppel Certificate, and (y) Sellers shall have no obligations whatsoever after the Closing Date to deliver the Ground Lessor 

	
			
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Estoppel, or (ii) terminate this Agreement with respect to the Ground Lease Property only, by notice given to such Seller in which event the Purchase Price shall be reduced by an amount equal to the portion of the Purchase Price allocated to the Ground Lease Property as shown on Schedule B-1  (and Sellers shall cause an Elimination to occur with respect to the Ground Lease Property).
		
	11.
	CONDITION OF THE PROPERTY; REPRESENTATIONS.

(a)    PURCHASER HEREBY ACKNOWLEDGES THAT, EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, NEITHER SELLER, NOR ANY PERSON ACTING ON BEHALF OF SELLER, NOR ANY PERSON OR ENTITY WHICH PREPARED OR PROVIDED ANY OF THE MATERIALS REVIEWED BY PURCHASER IN CONDUCTING ITS DUE DILIGENCE, NOR ANY DIRECT OR INDIRECT OFFICER, DIRECTOR, PARTNER, MEMBER, SHAREHOLDER, EMPLOYEE, AGENT, REPRESENTATIVE, ACCOUNTANT, ADVISOR, ATTORNEY, PRINCIPAL, AFFILIATE, CONSULTANT, CONTRACTOR, SUCCESSOR OR ASSIGN OF ANY OF THE FOREGOING PARTIES (SELLER, SELLER RELATED PARTIES AND ALL OF THE OTHER PARTIES DESCRIBED IN THE PRECEDING PORTIONS OF THIS SENTENCE (OTHER THAN PURCHASER) SHALL BE REFERRED TO HEREIN COLLECTIVELY AS THE "EXCULPATED PARTIES") HAS MADE OR SHALL BE DEEMED TO HAVE MADE ANY ORAL OR WRITTEN REPRESENTATIONS OR WARRANTIES, WHETHER EXPRESSED OR IMPLIED, BY OPERATION OF LAW OR OTHERWISE (INCLUDING WITHOUT LIMITATION WARRANTIES OF HABITABILITY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE), WITH RESPECT TO THE PROPERTIES, THE PERMITTED USE OF THE PROPERTIES OR THE ZONING AND OTHER LAWS, REGULATIONS AND RULES APPLICABLE THERETO OR THE COMPLIANCE BY THE PROPERTIES THEREWITH, THE REVENUES AND EXPENSES GENERATED BY OR ASSOCIATED WITH THE PROPERTIES, OR OTHERWISE RELATING TO THE PROPERTIES OR THE TRANSACTIONS CONTEMPLATED HEREIN.  EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, PURCHASER FURTHER ACKNOWLEDGES THAT ALL MATERIALS WHICH HAVE BEEN PROVIDED BY ANY OF THE EXCULPATED PARTIES HAVE BEEN PROVIDED WITHOUT ANY WARRANTY OR REPRESENTATION, EXPRESSED OR IMPLIED AS TO THEIR CONTENT, SUITABILITY FOR ANY PURPOSE, ACCURACY, TRUTHFULNESS OR COMPLETENESS AND PURCHASER SHALL NOT HAVE ANY RECOURSE AGAINST SELLER OR ANY OF THE OTHER EXCULPATED PARTIES IN THE EVENT OF ANY ERRORS THEREIN OR OMISSIONS THEREFROM.  PURCHASER IS ACQUIRING THE PROPERTIES BASED SOLELY ON ITS OWN INDEPENDENT INVESTIGATION AND INSPECTION OF THE PROPERTIES AND NOT IN RELIANCE ON ANY INFORMATION PROVIDED BY SELLER, OR ANY OF THE OTHER EXCULPATED PARTIES, EXCEPT FOR THE REPRESENTATIONS AND COVENANTS EXPRESSLY SET FORTH HEREIN.  PURCHASER EXPRESSLY DISCLAIMS ANY INTENT TO RELY ON ANY SUCH MATERIALS PROVIDED TO IT BY SELLER IN CONNECTION WITH ITS DUE DILIGENCE AND AGREES THAT IT SHALL RELY SOLELY ON ITS OWN INDEPENDENTLY DEVELOPED OR VERIFIED INFORMATION EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT.

	
			
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(b)    PURCHASER ACKNOWLEDGES AND AGREES THAT IT IS PURCHASING THE PROPERTIES "AS IS" AND "WITH ALL FAULTS", BASED UPON THE CONDITION (PHYSICAL OR OTHERWISE) OF THE PROPERTIES AS OF THE DATE OF THIS AGREEMENT, REASONABLE WEAR AND TEAR AND, SUBJECT TO THE PROVISIONS OF SECTIONS 12 AND 13 OF THIS AGREEMENT, LOSS BY CONDEMNATION OR FIRE OR OTHER CASUALTY EXCEPTED.  PURCHASER ACKNOWLEDGES AND AGREES THAT ITS OBLIGATIONS UNDER THIS AGREEMENT SHALL NOT BE SUBJECT TO ANY FINANCING CONTINGENCY OR OTHER CONTINGENCIES OR SATISFACTION OF CONDITIONS AND PURCHASER SHALL HAVE NO RIGHT TO TERMINATE THIS AGREEMENT OR RECEIVE A RETURN OF ANY PORTION OF THE DEPOSIT (OR THE ACCRUED INTEREST THEREON) EXCEPT AS EXPRESSLY PROVIDED FOR IN ANY PROVISION OF THIS AGREEMENT THAT EXPRESSLY PROVIDES FOR THE RETURN OF THE DEPOSIT TO PURCHASER.
(c)    EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT (AS UPDATED BY THE REPRESENTATION UPDATE), PURCHASER HEREBY IRREVOCABLY RELEASES SELLER AND ALL SELLER RELATED PARTIES FROM ALL CLAIMS WHICH PURCHASER OR ANY PARTY CLAIMING BY, THROUGH OR UNDER PURCHASER HAS OR MAY HAVE AS OF THE CLOSING ARISING FROM OR RELATED TO ANY MATTER OR THING RELATED TO OR IN CONNECTION WITH THE CONDITION OF THE PROPERTY, THE FRANCHISE AGREEMENTS, ANY CONSTRUCTION DEFECTS, ERRORS OR OMISSIONS IN THE DESIGN OR CONSTRUCTION AND ANY ENVIRONMENTAL CONDITIONS, AND PURCHASER SHALL NOT LOOK TO ANY SELLER RELATED PARTIES IN CONNECTION WITH THE FOREGOING FOR ANY REDRESS OR RELIEF.  THE FOREGOING RELEASE SHALL NOT BE APPLICABLE TO ANY AGREEMENT, REPRESENTATION OR WARRANTY OF SELLER FOR THE BENEFIT OF PURCHASER TO THE EXTENT EXPRESSLY CONTAINED IN THIS AGREEMENT.  THIS RELEASE SHALL BE GIVEN FULL FORCE AND EFFECT ACCORDING TO EACH OF ITS EXPRESSED TERMS AND PROVISIONS, INCLUDING THOSE RELATING TO UNKNOWN AND UNSUSPECTED CLAIMS, DAMAGES AND CAUSES OF ACTION AND, IN THAT REGARD, PURCHASER HEREBY EXPRESSLY WAIVES ALL RIGHTS AND BENEFITS IT MAY NOW HAVE OR HEREAFTER ACQUIRE UNDER CALIFORNIA CIVIL CODE SECTION 1542 WHICH PROVIDES: "A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR."  PURCHASER HAS BEEN ADVISED BY ITS LEGAL COUNSEL AND UNDERSTANDS THE SIGNIFICANCE OF THIS WAIVER OF SECTION 1542 RELATING TO UNKNOWN, UNSUSPECTED AND CONCEALED CLAIMS.  BY ITS INITIALS BELOW, PURCHASER ACKNOWLEDGES THAT IT FULLY UNDERSTANDS, APPRECIATES AND ACCEPTS ALL OF THE TERMS OF SECTIONS 11 (a)-(c). 
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	PURCHASER'S INITIALS
	 
	SELLERS' INITIALS

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(d)    Each Seller hereby represents and warrants to Purchaser jointly and severally as of the Effective Date as follows (each, a "Representation" and collectively, the "Representations"); provided, however, that none of the following Representations or any other representation of Sellers contained in this Agreement (to the extent they specifically relate to Individual Properties) shall apply to the Specified Hotels if Chatham LP or any of its Affiliates is the Purchaser thereunder: 
(i)    Organization and Power.  Each Seller is duly incorporated or formed (as the case may be), validly existing and in good standing in the jurisdiction of its incorporation or formation.  Each of the Transferred Entities and the JV Entities (other than Individual Owners) is duly incorporated or formed (as the case may be), validly existing, in good standing in the jurisdiction of its incorporation or formation.  Each Individual Owner is duly incorporated or formed (as the case may be), validly existing, in good standing in the jurisdiction of its incorporation or formation, and is qualified to do business in the jurisdiction in which such Individual Owner owns fee title or a ground leasehold interest in the applicable Premises.
(ii)    Authority and Binding Obligation.  (i) each Seller has full power and authority to execute and deliver this Agreement and all other documents to be executed and delivered by such Seller pursuant to this Agreement, (ii) the execution and delivery by the signer on behalf of each Seller, and the performance by each Seller of its obligations hereunder, has been duly and validly authorized by all requisite action and (iii) each document executed by any Seller hereunder, when executed and delivered, will constitute the legal, valid and binding obligations of such Seller enforceable against such Seller in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium, liquidation, fraudulent conveyance, fraudulent transfer and other laws relating to or affecting creditors' rights and remedies generally and general principles of equity and except to the extent Purchaser itself is in default thereunder.
(iii)    Condemnation.  To Sellers' Actual Knowledge (as hereinafter defined), except as set forth on Schedule F attached hereto, no Seller (nor any Transferred Entity or JV Entity) has received any written notice from a Governmental Authority of any pending condemnation proceeding or other proceeding in eminent domain. 
(iv)    Union Contract.  Except with respect to the collective bargaining agreement between Manager d/b/a Westin Governor Morris and The New York Hotel and Motel Trades Council, AFL-CIO (the "Union Contract"), none of Seller, any JV Entity or any Transferred Entity is a party to (or otherwise subject to) any collective bargaining agreement with any labor union with respect to the Hotel Employees or otherwise. Attached hereto as Schedule P is an accurate description of all Hotel Employees' titles, together with their base salary, bonus opportunity and hire date.  Sellers have delivered to Purchaser a true, correct and complete copy of the Union Contract.
(v)    Franchise Agreements.  Except for the Franchise Agreements set forth on Schedule C attached hereto, no Seller, JV Entity or any Transferred Entity is a party to any franchise agreements with respect to the Properties.  Except as set 

	
			
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forth on Schedule C-1 attached hereto, no Seller has received any written notice from any Franchisor that the JV Entities are in default under the applicable Franchise Agreements (other than those defaults that have been cured).  Sellers have delivered to Purchaser true and correct copies of all Franchise Agreements in effect with respect to any of the Properties.
(vi)    Finders and Investment Brokers.  Except for the Broker, Sellers have not dealt (nor have any JV Entities or Transferred Entities dealt) with any Person who has acted, directly or indirectly, as a broker, finder, financial adviser or in such other capacity for or on behalf of Sellers in connection with the transactions contemplated  by this Agreement in a manner which would entitle such person to any fee or commission in connection with this Agreement or the transactions contemplated by this Agreement.
(vii)    No Foreign Person.  Each Seller is a "United States person" (as defined in Section 7701(a)(30)(B) or (C) of the Code) for the purposes of the provisions of Section 1445(a) of the Code.
(viii)    Litigation.  Except as set forth on Schedule G attached hereto,, there is no action, suit, litigation, hearing or administrative proceeding pending against any Seller, any Transferred Entity or any JV Entity, or, to Sellers' Actual Knowledge, that is threatened, in each case, that is reasonably likely to materially and adversely affect Purchaser, any Transferred Entity or any JV Entity after the Closing that is not otherwise covered by insurance.
(ix)    Consents and Approvals. No Conflicts. Neither the execution, delivery or performance of this Agreement nor the consummation of the transactions contemplated hereby is prohibited, or, requires any Seller (or any JV Entity or Transferred Entity) to obtain any consent, authorization, approval or registration from a Governmental Authority under, any law, statute, rule, regulation, judgment, order, writ, injunction or decree which is binding upon any Seller; provided, however, no representation is made with respect to the transfer or deemed transfer of any liquor license.
(x)    Judgments. Except as set forth on Schedule M attached hereto, there are no judgments, orders or decrees against any Seller (or any Transferred Entity or JV Entity) that are unpaid and unsatisfied of record. 
(xi)    Prohibited Party. No Seller, JV Entity or Transferred Entity is now nor shall it be at any time prior to or at the Closing, a Person (as hereinafter defined) with whom a "U.S. Person" (as hereinafter defined), is prohibited from transacting business of the type contemplated by this Agreement, whether such prohibition arises under United States law, regulation, executive orders and lists published by the OFAC (as hereinafter defined) (including those executive orders and lists published by OFAC with respect to "Specially Designated Nationals and Blocked Persons" (as hereinafter defined) or otherwise.  No Seller, JV Entity or Transferred Entity nor, to any Seller's Actual Knowledge, any Person who owns an interest in any Seller, JV Entity or Transferred Entity (other than the owner of publicly traded shares) (collectively, a "Seller Party") is now nor shall be at any time prior 

	
			
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to or at the Closing a Person with whom a U.S. Person, including a Financial Institution (as hereinafter defined), is prohibited from transacting business of the type contemplated by this Agreement, whether such prohibition arises under United States law, regulation, executive orders and lists published by the OFAC (including those executive orders and lists published by OFAC with respect to Specially Designated Nationals and Blocked Persons) or otherwise. 
(xii)    Investigations. No Seller, JV Entity or Transferred Entity nor, to Seller's Actual Knowledge, any Seller Party, nor, to Seller's knowledge, any Person providing funds to any Seller, any JV Entity or any Transferred Entity:  (A) is under investigation by any governmental authority for, or has been charged with, or convicted of, money laundering, drug trafficking, terrorist related activities, any crimes which in the United States would be predicate crimes to money laundering, or any violation of any Anti-Money Laundering Laws (as hereinafter defined); (B) has been assessed civil or criminal penalties under any Anti-Money Laundering Laws; or (C) has had any of its funds seized or forfeited in any action under any Anti-Money Laundering Laws.  Such laws, regulations and sanctions shall be deemed to include the USA PATRIOT Act of 2001, Pub. L. No. 107-56 (the "Patriot Act"), the Bank Secrecy Act, 31 U.S.C. Section 5311 et. seq., the Trading with the Enemy Act, 50 U.S.C. App. Section 1 et. seq., the International Emergency Economic Powers Act, 50 U.S.C. Section 1701 et. seq., and the sanction regulations promulgated pursuant thereto by the OFAC, as well as laws relating to prevention and detection of money laundering in 18 U.S.C. Sections 1956 and 1957. 
(xiii)    Patriot Act.  Seller is (and the JV Entities and Transferred Entities are) in compliance with any and all applicable provisions of the Patriot Act. 
(xiv)    Ownership.  Sellers own the Transferred Interests free and clear of all liens, encumbrances, claims and other rights. Other than those interests in the Transferred Entities which are owned by Chatham Lodging, L.P., and Chatham TRS Holding, Inc. and/or their affiliates, Sellers own 100% of the Transferred Entities.  The Transferred Entities own, directly or indirectly, 100% of all right, title and interest in and to each of the JV Entities.  At the Closing, the Transferred Entities will own the JV Interests, directly or indirectly, free and clear of all liens, encumbrances, claims and other rights other than the interests and rights of the holders under the Existing Mezzanine Debt being paid off on the Closing Date.  At the Closing, except for transfers required by this Agreement, each entity shown on the Current Structure Chart will own the entities indicated to be owned by it on the Current Structure Chart free and clear of all liens, encumbrances, claims and other rights other than the Existing Mezzanine Debt being paid off at Closing.  At the Closing, no person or entity shall have any direct or indirect interest in any of the Transferred Entities or the JV Entities other than Chatham Lodging, L.P., and Chatham TRS Holding, Inc. and/or their affiliates.  Other than as shown in the Current Structure Chart, since the time of the Transferred Entities acquisition of the JV Entities pursuant to that certain Chapter 11 bankruptcy proceeding of Innkeepers USA Trust filed on July 19, 2010 in the United States Bankruptcy Court for the Southern District of New York (the "BK Acquisition"), no Seller nor any of the JV Entities or Transferred Entities has ever owned any subsidiaries or had any 

	
			
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interest in another entity.  All of the Transferred Interests and JV Interests are validly issued, fully paid and non-assessable.  There are no securities outstanding which are convertible into, exchangeable for, or carrying the right to acquire, equity securities (or securities convertible into or exchangeable for equity securities) of the JV Entities or Transferred Entities or subscriptions, pre-emptive rights, warrants, options, calls, convertible securities, registration or other rights or other arrangements or commitments relating thereto.  There are no outstanding obligations of any Person to repurchase, redeem or otherwise acquire any of the Transferred Interests or the JV Interests. None of the JV Interests or the Transferred Interests is subject to any voting or similar restrictions.
(xv)    Title.  To Sellers Actual Knowledge, each Operating Lessee owns title, free and clear of all liens or encumbrances (other than Permitted Encumbrances), claims and other rights,  to the FF&E, Bookings, Supplies, IT Systems, Retail Merchandise, Licenses and Permits, F&B, Books and Warranties applicable to its Individual Property.
(xvi)    Leases.  Schedule D attached hereto is a true and correct list of all Leases (exclusive of the Operating Leases) in effect as of the Effective Date and Sellers have made available to Purchaser for review true copies of all Leases set forth on Schedule D.  To Sellers' Actual Knowledge, Seller has not received (nor have any JV Entities or Transferred Entities received) written notice from a tenant that any JV Entity is in material default in the performance of its obligations thereunder which has not been cured.  Except as set forth on Schedule D-1 attached hereto, no tenant has paid rent more than one month in advance.  No tenant has any right or option to purchase all or any portion of any Individual Property. No brokerage commissions are owed in respect of any Lease or the renewal or expansion thereof.  It is expressly acknowledged and agreed that Sellers do not represent or warrant that any particular Lease will be in force and effect on the Closing Date or that the tenants will have performed their obligations thereunder and any delivery or receipt of written notice of default under any Lease or any termination by Sellers of a Lease on or after the Effective Date shall not affect the obligations of Purchaser hereunder, nor shall any such notice or termination make any representation or warranty of Sellers contained herein untrue.
(xvii)    Contracts.  To Sellers' Actual Knowledge, no Seller has received (nor has any Transferred Entity or JV Entity received) written notice from any other party under the Contracts that such Seller is in material default in the performance of its obligations thereunder that remains uncured.  Sellers have delivered to Purchaser true, correct and complete copies of the Contracts to the extent in Sellers' possession or control.
(xviii)    Insurance Certificates.  Attached hereto as Schedule K are true and correct copies of the insurance certificates for property and liability insurance maintained with respect to the Properties.
(xix)    Purchase Rights.  Except as otherwise provided in the Franchise Agreements, no Person has any right or option to purchase any of the Transferred Interests or any of the JV Interests or any of the Properties.

	
			
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(xx)    Ground Lease.  That certain Lease Agreement by and between The City of Fort Lauderdale, a municipal corporation, as lessor ("Ground Lessor") and Grand Prix Ft. Lauderdale LLC, a Delaware limited liability company, as successor in interest to Execusuite Inn I, Ltd., as lessee, dated August 1, 1984; as assigned by that certain Consent and Approval to Assignment of Option to Lease and Accompanying Lease by and among the City of Lauderdale, Execusuite Inn I, Ltd, and Cyprus Hotel Associates, Ltd, dated as of June 4, 1986; as amended by that First Amendment of Lease Agreement between the City of Fort Lauderdale and Cypress Hotel Associates, Ltd., dated May 21, 1987; as assigned by that certain Consent to Assignment of Lease Agreement between the City of Fort Lauderdale, Cypress Hotel Associates, Ltd. and Cypress Hotel Joint Venture dated November 16, 1987; as further amended by that certain Second Amendment to Lease Agreement between the City of Fort Lauderdale and Cypress Hotel Joint Venture, dated as of July 6, 1988; as further amended by that certain Third Amendment to Lease Agreement between the City of Fort Lauderdale and Cyprus Hotel Joint Venture, dated as of July 30, 1993; as assigned by that certain Assignment of Lease between Cyprus Hotel Joint Venture and Innkeepers USA Limited Partnership, dated September 30, 1994; as assigned by that certain Assignment and Assumption of Ground Lease between Innkeepers USA Limited Partnership and Grand Prix Ft. Lauderdale LLC, dated as of June 29, 2007 (as amended, supplemented, assigned or otherwise modified from time to time, the "Fort Lauderdale Ground Lease") has not been extended, amended or terminated. Sellers have delivered to Purchaser a true, correct and complete copy of the Fort Lauderdale Ground Lease.  To Sellers' Actual Knowledge, Seller has not received (nor has any JV Entity or Transferred Entity received) written notice that Seller is in material default in the performance of its obligations thereunder that have not been cured.  No brokerage commissions are owed in respect of the Fort Lauderdale Ground Lease or the renewal or expansion thereof.  
(xxi)    Financials.  To Sellers' Actual Knowledge, attached hereto as Schedule L are true, correct and complete copies of all audited financial statements for the calendar years in which Sellers owned any indirect interest in the Properties and year-to-date unaudited financial statements for the year 2014 for the Individual Owners, the Transferred Entities and the JV Entities (collectively, the "Financials").  In each case, to Sellers' Actual Knowledge, (i) the Financials have been prepared in accordance with generally accepted accounting principles in the United States and (ii) the Financials present fairly, in all material respects, as of their respective dates and for the periods set forth therein, the financial position and results of operations, as the case may be, of the Transferred Entities and the JV Entities (and in all cases all liabilities and obligations of the applicable Person).
(xxii)    Organizational Documents.  Sellers have delivered to Purchaser true, correct and complete copies of the organizational documents (including, without limitation, limited liability company operating agreements, limited partnership agreements, articles of organization, certificates of partnership, certificates of formation and any amendments or modifications to any such documents) (collectively, the "Organizational Documents") governing the JV Entities and the Transferred Entities.  All of the Organizational Documents are in full force and effect and unmodified since the date of delivery of same to Purchaser.  All of the Transferred Interests and the JV Interests have been duly issued in 

	
			
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accordance with applicable laws (including, without limitation, all securities and "blue-sky" laws). 
(xxiii)    Bankruptcy.  Since the BK Acquisition, neither any Seller, any JV Entity or any Transferred Entity has (i) made a general assignment for the benefit of its creditors; (ii) had an attachment, execution or other judicial seizure of any property interest which remains in effect; or (iii) filed for protection under any  federal, state or local law seeking relief from its debts (including, without limitation, under the United States Bankruptcy Code).
(xxiv)    Percentage Interest. The Percentage Interest of Sellers in the Transferred Entities constitutes all of the right, title and interest of the Sellers in and to the Transferred Entities.
(xxv)    Material Liabilities.  Except as expressly disclosed to Purchaser in writing or in the Datasite prior to the expiration of the Due Diligence Period or with respect to costs that are subject to prorations set forth in Section 7 above or any obligations which are expressly permitted to be incurred pursuant to this Agreement or with respect to any matters that are covered by insurance, none of the JV Entities or the Transferred Entities has (or will have) any material liabilities or obligations of any nature, whether or not accrued, contingent or otherwise, which relate to acts or omissions occurring prior to the Closing.
(xxvi)    Tax Representations.  
(1)    No Tax Sharing Agreement. Neither the Transferred Entities nor the JV Entities are party to or bound by any obligation under any Tax sharing or similar agreement or arrangement covering any potential assumption of Tax liability of another Person.
(2)    Tax Classification. Each of the Transferred Entities and each JV Entity have been classified as either a partnership (within the meaning of Section 301.7701-2(a)) of the Treasury Regulations or disregarded entity (within the meaning of Section 301.7701-3(b)(1) of the Treasury Regulations) for federal and all applicable state and local Tax purposes since the date of their formation.
(3)    No IRS Rulings. Neither the Transferred Entities nor the JV Entities have requested any private letter rulings from the IRS or comparable rulings from other taxing authorities or have entered into any "closing agreement" as described in Section 7121 of the Code or similar arrangement.
(4)    No Built-In Gain.  There is no built-in gain with respect to the property held directly or indirectly by the Transferred Entities and the JV Entities that is subject to the tax on built-in gain as of the Closing Date pursuant to IRS Notice 88-19, Section 1.337(d)-7 of the Treasury Regulations, or any other temporary or final regulations issued under Section 337(d) of the Code or any elections made thereunder, including the tax basis and fair market value of such property at the time the property became subject to the tax on built-in gain.

	
			
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Notwithstanding the foregoing, if Purchaser has knowledge of a breach of any representation or warranty made by Seller in this Agreement and Purchaser nevertheless proceeds to close the transactions described in this Agreement, such representation or warranty by Seller shall be deemed to be qualified or modified to reflect Purchaser's knowledge of such breach. 
Any and all uses of the phrase, "to Seller's Actual Knowledge" or other references to Seller's knowledge in this Agreement (or in any document delivered by Seller pursuant to the terms of this Agreement), shall mean the actual, present, conscious knowledge of Tom Wagner or Stephen Pozatek (the "Seller Knowledge Individuals") as to a fact at the time given without any investigation or inquiry except it is acknowledged by Sellers that it has made inquiry of Eric Kentoff of Chatham Lodging Trust and Scott Robertson as to the accuracy of the Representations.  Without limiting the foregoing, Purchaser acknowledges that the Seller Knowledge Individuals have not performed and are not obligated to perform any investigation or review of any files or other information in the possession of Sellers, or to make any inquiry of any persons, or to take any other actions in connection with the representations and warranties of Sellers set forth in this Agreement, other than as expressly set forth above in this paragraph.  Neither the actual, present, conscious knowledge of any other individual or entity, nor the constructive knowledge of the Seller Knowledge Individuals or of any other individual or entity, shall be imputed to the Seller Knowledge Individual other than as expressly set forth above in this paragraph.
(e)    The representations and warranties of Sellers contained in Section 11(d) and elsewhere herein, in each case as though made at and as of the Closing Date and as updated by the Representation Update and the covenants and indemnities of Sellers contained in this Agreement, shall, except for the Tax Representations, Section 39(f), Section 42 and the provisions of Sections 9(a)(xviii) and 39(c), survive the Closing for one hundred and eighty (180) days following the Closing Date (the "Limitation Period").  The provisions of Sections 9(a)(xviii) and 39(c) shall survive the Closing for six (6) years and one (1) month and the Tax Representations, Section 39(f) and Section 42 below shall survive until thirty (30) days after the expiration of the applicable statute of limitations (including any waivers or extensions thereof).  Each such representation, warranty, covenant and indemnity except for the Tax Representations, Section 39(f), Section 42 and the provisions of Sections 9(a)(xviii) and 39(c), shall automatically be null and void and of no further force and effect following the 180th day following the Closing Date unless, on or prior to such 180th day, Purchaser shall have provided any Seller with a notice alleging that a Seller is in breach of such representation, warranty, covenant or indemnity and specifying in reasonable detail the nature of such breach.  Purchaser shall allow such Seller thirty (30) days after its notice within which to cure such breach or if such breach cannot be cured within such thirty (30) day period, and a Seller notifies Purchaser it wishes to extend its cure period (the "Cure Extension Notice"), such additional reasonable period of time as is required to cure the same so long as such cure has been commenced within such initial thirty (30) day period, is being diligently pursued to completion and such cure is completed within thirty (30) days after the expiration of the initial 30-day cure period, time being of the essence.  If any Seller fails to cure such breach after written notice thereof (and the expiration of such cure periods), Purchaser's sole and exclusive remedy (subject to Section 20) shall be to commence a legal proceeding against such Seller alleging that such Seller has breached such representation or warranty and that Purchaser has suffered actual damages as a result thereof (a "Proceeding"), which Proceeding must be commenced, if at all, within sixty (60) 

	
			
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days after the expiration of the Limitation Period; provided, however, that if Purchaser gives Sellers written notice of such a breach within the Limitation Period, and Sellers subsequently sends a Cure Extension Notice, then Purchaser shall have until the date which is thirty (30) days after the date Sellers notifies Purchaser it has ceased endeavoring to cure such breach, to commence such Proceeding.  If Purchaser shall have timely commenced a Proceeding and a court of competent jurisdiction shall, pursuant to a final, non-appealable order or judgment (1) determine that Seller was in breach of the applicable representation or warranty, and (2) determine that Purchaser suffered actual damages (the "Damages") by reason of such breach, and (3) does not determine that Purchaser had actual knowledge of such breach on or prior to the Closing Date, then, subject to the limitations contained in this Agreement, Purchaser shall be entitled to receive an amount equal to the Damages.  Any such Damages, subject to the limitations contained herein, shall be paid within fifteen (15) days following the entry of such final, non-appealable order and delivery of a copy thereof to Seller; provided, however, that the representations and warranties in Sections 11(d)(xxvi), as though made at and as of the Closing Date and as updated by the Representation Update (collectively, the "Tax Representations") only will survive until thirty (30) days after the expiration of the applicable statute of limitations (including any waivers or extensions thereof).  Cerberus Series Four Holdings, LLC, a Delaware limited liability company ("Guarantor"), hereby joins in the execution of this Agreement to acknowledge its guaranty of Sellers' obligations hereunder as limited hereby and in the Joinder (as hereinafter defined).  If Purchaser brings an action against Guarantor based on the Guaranty (as defined in the Joinder), Purchaser acknowledges that, except for the waivers expressly set forth in the joinder to this Agreement (the "Joinder"), Guarantor may assert any and all rights, defenses, and offsets that Sellers may have against Purchaser.  In the event that Sellers shall be in breach of any of the Representations and indemnities, Purchaser shall have no recourse to the property or assets of Seller or any of the other Exculpated Parties, other than the Guaranty and Purchaser's sole and exclusive remedy, in such event, shall be as described above.  Notwithstanding the foregoing or anything else to the contrary contained in this Agreement, it is expressly acknowledged and agreed by the Purchaser that if, at any time prior to the Closing, Purchaser or Sellers, at Sellers' expense, obtain a Representations Insurance Policy (as hereinafter defined), the Joinder shall automatically (and without the necessity of any further instrument), be terminated and void ab initio and of no further force and effect other than solely with respect to adjustments and prorations as expressly set forth in Section 7(b)(xiv) above and Sellers' other post-closing monetary obligations expressly set forth herein that are not covered by the Representations Insurance Policy.  For purposes of this Agreement, the term "Representations Insurance Policy" shall mean a "Representations and Warranties Insurance Policy" in favor of Purchaser from a reputable insurance carrier having a rating of not less than A-VIII from AM Best or A- from S&P pursuant to which such Representations Insurance Policy shall insure against Sellers' post-closing monetary obligations with respect to breaches of Sellers' representations, warranties and indemnities under this Agreement and otherwise be on generally commercially acceptable terms and do not materially diminish Purchaser's rights (or increase its obligations) that it otherwise would have under this Agreement, subject to all limitations (including, without limitation, survival and maximum liability), as more particularly set forth in Section 11 and elsewhere in this Agreement.
(f)    In the event that, prior to the Closing, any Diligence Party shall obtain actual knowledge of any information that is contradictory to, and would constitute the basis of a breach of, any representation or warranty, then, promptly thereafter (and, in all events, prior to 

	
			
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Closing), Purchaser shall deliver to Seller notice of such information specifying the representation or warranty to which such information relates and Purchaser further acknowledges that such representation or warranty will not be deemed breached in the event any Diligence Party shall have, prior to Closing, obtained actual knowledge of any information that is contradictory to such representation or warranty and Purchaser shall not be entitled to bring any action after the Closing Date based on a breach of such representation or warranty to the extent based on such information.  Without limiting the generality of the foregoing, Purchaser shall be deemed to know that any representation or warranty contained herein is untrue, inaccurate or breached to the extent that (1) prior to the expiration of the Due Diligence Period, any Diligence Party had knowledge of any fact or information which is inconsistent with such representation or warranty or (2) this Agreement or any information with respect to the Properties delivered or made available to Purchaser on the Datasite prior to the expiration of the Due Diligence Period contain provisions inconsistent with any of such representations and warranties.  "Diligence Party" shall mean Zachary Shull and/or Sujan Patel except that it is acknowledged by Purchaser that it has made inquiry of Eric Kentoff as to the accuracy of the representations and warranties contained herein.
(g)    Each of the provisions of Section 11 shall survive the Closing, but such survival shall be limited, in the case of the representations, warranties, covenants and indemnities set forth in Section 11(d) and elsewhere herein, to the extent set forth therein.  The provisions of Sections 11(a) and 11(b) shall be deemed incorporated by reference and made a part of all documents or instruments delivered by Seller to Purchaser in connection with the sale of the Properties.
(h)    Purchaser hereby represents and warrants to Seller as of the Effective Date and as of Closing that: 
(i)    Authority and Binding Obligation. Purchaser has full power and authority to enter into and perform this Agreement in accordance with its terms and this Agreement and all documents executed by Purchaser which are to be delivered to Seller at Closing are, and at the time of Closing will be, duly authorized, executed and delivered by Purchaser and are, and at the time of Closing will be the legal, valid and binding obligations of Purchaser, enforceable against Purchaser in accordance with their respective terms.
(ii)    Consents and Approvals; No Conflicts. Neither the execution, delivery or performance of this Agreement nor the consummation of the transactions contemplated hereby is prohibited, or requires Purchaser to obtain any consent, authorization, approval or registration under, any law, statute, rule, regulation, judgment, order, writ, injunction or decree which is binding upon Purchaser.
(iii)    Judgments. There are no judgments, orders or decrees of any kind against Purchaser unpaid and unsatisfied of record, nor any actions, suits or other legal or administrative proceedings pending or, to Purchaser's actual knowledge, threatened against Purchaser, which would have a material adverse effect on Purchaser's ability to consummate the transactions contemplated by this Agreement.

	
			
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(iv)    Employee Benefit Plans. Purchaser is not (and, throughout the period transactions are occurring pursuant to this Agreement, will not be) and is not acting on behalf of (and, throughout the period transactions are occurring pursuant to this Agreement, will not be acting on behalf of) an "employee benefit plan" as defined in Section 3(3) of ERISA that is subject to Title I of ERISA, a "plan" as defined in and subject to Section 4975 of the Internal Revenue Code, or an entity deemed to hold plan assets of any of the foregoing pursuant to 29 C.F.R. Section 2510.3-101, as modified by Section 3(42) of ERISA.  None of the transactions contemplated by this Agreement is in violation of any state statutes applicable to Purchaser regulating investments of, and fiduciary obligations with respect to, governmental plans similar to the provisions of Section 406 of ERISA or Section 4975 of the Internal Revenue Code. 
(v)    Prohibited Party. Purchaser is not now nor shall it be at any time prior to or at the Closing, an individual, corporation, partnership, joint venture, association, joint stock company, trust, trustee, estate, limited liability company, unincorporated organization, real estate investment trust, government or any agency or political subdivision thereof, or any other form of entity (collectively, a "Person") with whom a United States citizen, entity organized under the laws of the United States or its territories or entity having its principal place of business within the United States or any of its territories (collectively, a "U.S. Person"), is prohibited from transacting business of the type contemplated by this Agreement, whether such prohibition arises under United States law, regulation, executive orders and lists published by the Office of Foreign Assets Control, Department of the Treasury ("OFAC") (including those executive orders and lists published by OFAC with respect to Persons that have been designated by executive order or by the sanction regulations of OFAC as Persons with whom U.S. Persons may not transact business or must limit their interactions to types approved by OFAC  "Specially Designated Nationals and Blocked Persons") or otherwise.  Neither Purchaser nor, to Purchaser's knowledge,  any Person who owns an interest in Purchaser (other than the owner of publicly traded shares) (collectively, a "Purchaser Party") is now nor shall be at any time prior to or at the Closing a Person with whom a U.S. Person, including a United States Financial Institution as defined in 31 U.S.C. 5312, as periodically amended ("Financial Institution"), is prohibited from transacting business of the type contemplated by this Agreement, whether such prohibition arises under United States law, regulation, executive orders and lists published by the OFAC (including those executive orders and lists published by OFAC with respect to Specially Designated Nationals and Blocked Persons) or otherwise. 
(vi)    Investigations. Neither Purchaser nor, to Purchaser's knowledge, any Purchaser Party, nor, to Purchaser's knowledge,  any Person providing funds to Purchaser:  (A) is under investigation by any governmental authority for, or has been charged with, or convicted of, money laundering, drug trafficking, terrorist related activities, any crimes which in the United States would be predicate crimes to money laundering, or any violation of any Anti-Money Laundering Laws; (B) has been assessed civil or criminal penalties under any Anti-Money Laundering Laws; or (C) has had any of its funds seized or forfeited in any action under any Anti-Money Laundering Laws.  For purposes of Section 11(d)(xii) and this subsection (h), the term "Anti-Money Laundering Laws" shall mean laws, 

	
			
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regulations and sanctions, state and federal, criminal and civil, that:  (w) limit the use of and/or seek the forfeiture of proceeds from illegal transactions; (x) limit commercial transactions with designated countries or individuals believed to be terrorists, narcotics dealers or otherwise engaged in activities contrary to the interests of the United States; (y) require identification and documentation of the parties with whom a Financial Institution conducts business; or (z) are designed to disrupt the flow of funds to terrorist organizations.  Such laws, regulations and sanctions shall be deemed to include the Patriot Act, the Bank Secrecy Act, 31 U.S.C. Section 5311 et. seq., the Trading with the Enemy Act, 50 U.S.C. App. Section 1 et. seq., the International Emergency Economic Powers Act, 50 U.S.C. Section 1701 et. seq., and the sanction regulations promulgated pursuant thereto by the OFAC, as well as laws relating to prevention and detection of money laundering in 18 U.S.C. Sections 1956 and 1957. 
(vii)    Patriot Act.  Purchaser is in compliance with any and all applicable provisions of the Patriot Act.
(viii)    Competitor.  Purchaser is not a "Competitor" or "Brand" as each such term is defined in each of the Marriott Franchise Agreements. 
(ix)    Ownership of Purchaser.  Purchaser is owned solely by Chatham Lodging Trust and/or one (1) or more Affiliates thereof and/or NRFC Sub-REIT Corp. and/or one (1) or more Affiliates thereof.  For purposes of this Agreement, the term "Affiliate" means, as to any particular Person, any Person directly or indirectly, through one or more intermediaries, controlling, Controlled by or under common control with the Person or Persons in question.  For purposes of this clause (ix) and Section 28(b), the term Control means the power to direct or cause the direction of the management or policies of an entity, whether through the ability to exercise voting power, by contract or otherwise. "Controlled by," "controlling" and "under common control with" shall have the respective correlative meaning thereto.
(i)    Notwithstanding anything to the contrary set forth in this Agreement, Seller makes no warranty with respect to the presence of Hazardous Materials (as hereinafter defined) on, above or beneath the Premises (or any parcel in proximity thereto) or in any water on or under the Premises.  Unless expressly prohibited by applicable law, Purchaser's Closing hereunder shall be deemed to constitute an express waiver of Purchaser's right to cause Seller to be joined in any action brought under any Environmental Laws (as hereinafter defined).  The term "Hazardous Materials" means (a) those substances included within the definitions of any one or more of the terms "hazardous materials," "hazardous wastes," "hazardous substances," "industrial wastes," and "toxic pollutants," as such terms are defined under the Environmental Laws, or any of them, (b) petroleum and petroleum products, including, without limitation, crude oil and any fractions thereof, (c) natural gas, synthetic gas and any mixtures thereof, (d) asbestos and or any material which contains any hydrated mineral silicate, including, without limitation, chrysotile, amosite, crocidolite, tremolite, anthophylite and/or actinolite, whether friable or non-friable (collectively, "Asbestos"), (e) polychlorinated biphenyl ("PCBs") or PCB-containing materials or fluids, (f) radon, (g) any other hazardous or radioactive substance, material, pollutant, contaminant 

	
			
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or waste, and (h) any other substance with respect to which any Environmental Law or governmental authority requires environmental investigation, monitoring or remediation.  The term "Environmental Laws" means all federal, state and local laws, statutes, ordinances and regulations, now or hereafter in effect, as amended or supplemented from time to time, including, without limitation, all applicable judicial or administrative orders, applicable consent decrees and binding judgments relating to the regulation and protection of human health, safety, the environment and natural resources (including, without limitation, ambient air, surface, water, groundwater, wetlands, land surface or subsurface strata, wildlife, aquatic species and vegetation), including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended (42 U.S.C. §§ 9601 et seq.), the Hazardous Material Transportation Act, as amended (49 U.S.C. §§ 1801 et seq.), the Federal Insecticide, Fungicide, and Rodenticide Act, as amended (7 U.S.C. §§ 136 et seq.), the Resource Conservation and Recovery Act, as amended (42 U.S. §§ 6901 et seq.), the Toxic Substance Control Act, as amended (15 U.S.C. §§ 2601 et seq.), the Clean Air Act, as amended (42 U.S.C. §§ 7401 et seq.), the Federal Water Pollution Control Act, as amended (33 U.S.C. §§ 1251 et seq.), the Occupational Safety and Health Act, as amended (29 U.S.C. §§ 651 et seq.), the Safe Drinking Water Act, as amended (42 U.S.C. §§ 300f et seq.), Environmental Protection Agency regulations pertaining to Asbestos (including, without limitation, 40 C.F.R. Part 61, Subpart M, the United States Environmental Protection Agency Guidelines on Mold Remediation in Schools and Commercial Buildings, the United States Occupational Safety and Health Administration regulations pertaining to Asbestos including, without limitation, 29 C.F.R.  Sections 1910.1001 and 1926.58), applicable California State and local or any other city, state and municipal statutes and the rules and regulations promulgated pursuant thereto regulating the storage, use and disposal of Hazardous Materials, and any state or local counterpart or equivalent of any of the foregoing, and any related federal, state or local transfer of ownership notification or approval statutes.  Except with respect to any claims arising out of any breach of covenants, representations or warranties expressly set forth in Section 9(a) above, Purchaser, for itself and its agents, affiliates, successors and assigns, hereby releases and forever discharges Seller, and the other Seller Parties from any and all actions, damages, liens, liabilities, rights, claims and demands at law or in equity, whether known or unknown at the time of this Agreement, which Purchaser has or may have in the future, arising out of the physical or environmental condition of the Properties, including, without limitation, any claim for indemnification or contribution arising under any Environmental Law.
(j)    Notwithstanding anything to the contrary set forth in this Agreement, following the Closing, Sellers' liability for breach of any covenant, representation, warranty or indemnity of Sellers contained in this Agreement and in any document executed by Sellers pursuant to this Agreement, including any instruments delivered at Closing by Sellers, shall, subject to the limitations of survival set forth in this Section 11, be limited to claims in excess of $1,000,000.00 in the aggregate for all claims, including, without limitation, for any indemnities of Sellers set forth in this Agreement (and once such aggregate threshold has been achieved, Purchaser may pursue all of its Damages including, without limitation, any Damages in amounts less than such $1,000,000.00), and Sellers' aggregate liability for any and all claims arising out of any such covenants, representations, warranties and indemnities in this Agreement, including any instruments delivered at Closing by Sellers, shall not exceed Thirty Million Dollars ($30,000,000.00).  In addition, except as set forth in the first sentence of Section 20(b), in no event shall Sellers or Purchaser be liable for any incidental, consequential, indirect, punitive, special or exemplary damages, or for 

	
			
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lost profits, unrealized expectations or other similar claims, and in every case a party's recovery for any claims referenced herein shall be net of any insurance proceeds and any indemnity, contribution or other similar payment actually recovered or recoverable by Purchaser from any insurance company, tenant, or other third party.  
		
	12.
	DAMAGE AND DESTRUCTION.

(a)    If all or any part of any Building is damaged by fire or other casualty occurring on or after the Effective Date and prior to the Closing Date, whether or not such damage affects a material part of the Building, then except as provided below, neither Party shall have the right to terminate this Agreement and the Parties shall nonetheless consummate the transactions in accordance with this Agreement, without any abatement of the Purchase Price or any liability or obligation on the part of Seller by reason of such destruction or damage.  If there is any damage to an Individual Property, Seller shall assign to Purchaser and Purchaser shall have the right to make a claim for and to retain any casualty insurance proceeds (including, without limitation, business interruption proceeds) received or payable under such insurance policies (if any) in effect with respect to the Individual Property so damaged on account of such physical damage or destruction and Purchaser shall receive a credit against the cash due at Closing for the amount of the deductible on such insurance policy less any amounts reasonably and actually expended by Seller to collect any such insurance proceeds or to remedy any unsafe conditions at the Property or to repair or restore any damages which is imminently necessary, in no event to exceed the amount of the loss.  If this Agreement shall still be in full force and effect following the expiration of the Due Diligence Period, no Seller shall settle any claim seeking any insurance proceeds in respect of any such casualty without the consent of Purchaser.
(b)    If all or any part of the Buildings are damaged by fire or other casualty occurring on or after the Effective Date and prior to the Closing Date, and either (x) the cost to restore any Building(s) as  a result of such casualty is uninsured; or (y)  the aggregate estimated cost of repair or restoration (in the aggregate with respect to all such casualties at one or more Properties as reasonably determined by the parties) exceeds five percent (5%) of the aggregate Purchase Price, Purchaser shall have the option, exercisable within ten (10) days after receipt of notice of the occurrence of such fire or other casualty (i.e., the last such casualty which caused such five percent (5%) threshold to be achieved), time being of the essence, to terminate this Agreement in its entirety by delivering written notice of such termination to Sellers and Escrow Agent, whereupon the Deposit (together with any interest accrued thereon) shall be returned to Purchaser and this Agreement shall be deemed canceled and of no further force or effect, and no Party hereto shall have any further rights or obligations hereunder, except those arising under provisions of this Agreement that expressly survive the termination hereof.  If a fire or other casualty described in this clause (b) shall occur and Purchaser shall not timely elect to terminate this Agreement, then Purchaser and Sellers shall consummate the transactions in accordance with this Agreement, without any abatement of the Purchase Price or any liability or obligation on the part of Sellers by reason of such destruction or damage and, in such event, Sellers shall assign to Purchaser and Purchaser shall have the right to make a claim for and to retain any casualty insurance proceeds received under the casualty insurance policies (including, without limitation, business interruption proceeds) in effect with respect to the Properties on account of such physical damage or destruction as shall be 

	
			
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necessary to perform repairs to the Building(s) and/or to rebuild the Building(s) to substantially the same condition as existed prior to the occurrence of such fire or other casualty, in no event to exceed the amount of the loss, and Purchaser shall receive a credit against the cash due at Closing for the amount of the deductible on such casualty insurance policy less any amounts reasonably and actually expended by Sellers to collect any such insurance proceeds or to remedy any unsafe conditions at the Premises or to repair or restore any damages which is imminently necessary.  In the event such amount spent by Sellers shall exceed the amount of the deductible on such casualty insurance policy, then Purchaser shall deliver such excess amount to Sellers, within five (5) business days of its receipt of any casualty insurance proceeds received on account of such casualty, provided that Purchaser shall be required to pay such amount only out of casualty insurance proceeds received by Purchaser in excess of the amount of the loss. 
(c)    The provisions of this Section 12 supersede any law applicable to the Premises governing the effect of fire or other casualty in contracts for real property.
		
	13.
	CONDEMNATION.

(a)    If, prior to the Closing Date, any part of the Premises at an Individual Property is taken, or if any Seller shall receive an official notice from any governmental authority having eminent domain power over the Premises or an Individual Property of its intention to take, by eminent domain proceeding, any part of the Premises or an Individual Property (a "Taking"), then: 
(vi)    if such Taking (x) involves twenty-five percent (25%) or less of the aggregate square footage of all Buildings constituting portions of an Individual Property as determined by an independent architect chosen by Seller (subject to Purchaser's review and reasonable approval of such determination), and (y) does not materially and adversely affect the access to the Buildings constituting portions of an Individual Property or materially reduces parking (and, without limiting the generality thereof, for such purpose the term "material" shall in all events mean any reduction below the number of spaces required under the zoning code then in effect), neither Party shall have any right to terminate this Agreement or remove the Affected Property (as hereinafter defined) from this Agreement, and the Parties shall nonetheless consummate the transactions in accordance with this Agreement, without any abatement of the Purchase Price or any liability or obligation on the part of Seller by reason of such Taking; provided, however, that Sellers shall, on the Closing Date, (i) assign and remit to Purchaser the proceeds of any award or other proceeds of such Taking which may have been collected by the applicable Seller as a result of such Taking, or (ii) if no award or other proceeds shall have been collected, deliver to Purchaser an assignment of such Seller's right to any such award or other proceeds which may be payable to any Seller as a result of such Taking.  If this Agreement shall still be in full force and effect following the expiration of the Due Diligence Period, no Seller shall settle any claim for condemnation awards without the prior written consent of Purchaser and all aspects of any litigation, proceeding or negotiation with regard thereto shall also be subject to Purchaser's prior written consent.

	
			
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(vii)    if such Taking (x) involves more than twenty-five percent (25%) of the aggregate square footage of all Buildings constituting portions of an Individual Property as determined by an independent architect chosen by Seller (subject to Purchaser's review and reasonable approval of such determination), or (y) materially and adversely affect the access to the Buildings constituting portions of an Individual Property or materially reduces parking (and, without limiting the generality thereof, for such purpose the term "material" shall in all events mean any reduction below the number of spaces required under the zoning code then in effect) (the "Affected Property"), Purchaser shall have the option, exercisable within ten (10) days after receipt of written notice of such Taking, time being of the essence, to withdraw the Affected Property from the Properties with respect to such Affected Property only, by delivering notice of such termination to Seller, whereupon the Properties being conveyed pursuant to this Agreement shall no longer be deemed to include the Affected Property and this Agreement shall be deemed canceled and of no further force or effect with respect to such Affected Property only, and no Party hereto shall have any further rights or obligations hereunder with respect to such Affected Property, except those arising under provisions of this Agreement that expressly survive the termination hereof.  If a Taking described in this clause (ii) shall occur and Purchaser shall not timely elect to terminate this Agreement as to such Affected Property, then Purchaser and Seller shall consummate the transactions in accordance with this Agreement, without any abatement of the Purchase Price or any liability or obligation on the part of Seller by reason of such Taking; provided, however, that each Seller shall, on the Closing Date, (i) assign and remit to Purchaser the proceeds of any award or other proceeds of such Taking which may have been collected by any Seller as a result of such Taking, or (ii) if no award or other proceeds shall have been collected, deliver to Purchaser an assignment of such Seller's right to any such award or other proceeds which may be payable to Seller as a result of such Taking.
(b)    The provisions of this Section 13 supersede any law applicable to the Premises governing the effect of condemnation in contracts for real property.  Any disputes under this Section 13 as to whether the Taking involves more than twenty-five percent (25%) of the aggregate square footage of all Buildings constituting portions of an Individual Property, materially reduces parking or materially adversely affects access to any Individual Premises shall be resolved by expedited arbitration before a single arbitrator in New York, New York acceptable to both Seller and Purchaser in their reasonable judgment in accordance with the rules of the American Arbitration Association; provided that if Seller and Purchaser fail to agree on an arbitrator within five days after a dispute arises, then either Party may request the office of the American Arbitration Association located in New York, New York to designate an arbitrator.  Such arbitrator shall be an independent architect having at least ten (10) years of experience in the construction of office buildings in New York, New York.  The costs and expenses of such Arbitrator shall be borne equally by Sellers and Purchaser.
		
	14.
	BROKERS AND ADVISORS.

(a)    Purchaser represents and warrants to Seller that it has not dealt or negotiated with, or engaged on its own behalf or for its benefit, any broker, finder, consultant, advisor, or professional in the capacity of a broker or finder (each a "Broker") in connection with 

	
			
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this Agreement or the transactions contemplated hereby other than Eastdil Secured, LLC (the "Seller's Broker").  Purchaser, hereby agrees to indemnify, defend and hold Seller and the other Seller Related Parties harmless from and against any and all claims, demands, causes of action, losses, costs and expenses (including reasonable attorneys' fees, court costs and disbursements) arising from any claim for commission, fees or other compensation or reimbursement for expenses made by any Broker (other than Seller's Broker) engaged by or claiming to have dealt with Purchaser in connection with this Agreement or the transactions contemplated hereby other than Seller's Broker. Sellers agree to pay Seller's Broker any commission or other payment that Seller's Broker may be entitled pursuant to a separate agreement.
(b)    Seller represents and warrants to Purchaser that it has not dealt or negotiated with, or engaged on its own behalf or for its benefit, any Broker in connection with this Agreement or the transactions contemplated hereby other than Seller's Broker.  Seller hereby agrees to indemnify, defend and hold Purchaser, the Transferred Entities and the JV Entities and their direct and indirect shareholders, officers, directors, partners, principals, members, employees, agents, contractors and any successors or assigns of the foregoing, harmless from and against any and all claims, demands, causes of action, losses, costs and expenses (including reasonable attorneys' fees, court costs and disbursements) arising from any claim for commission, fees or other compensation or reimbursement for expenses made by any Broker (including Seller's Broker) engaged by or claiming to have dealt with Seller in connection with this Agreement or the transactions contemplated hereby.
(c)    The provisions of this Section 14 shall survive the termination of this Agreement or the Closing.
		
	15.
	TAX REDUCTION PROCEEDINGS. 

Sellers may file and/or prosecute an application for the reduction of the assessed valuation of the Premises or any portion thereof for real estate taxes or a refund of real estate taxes previously paid (a "Tax Certiorari Proceeding") to the locality in which the applicable Individual Property is located for any fiscal year which includes the Closing or any fiscal year preceding the fiscal year in which the Closing occurs.  Seller shall have the right to withdraw, settle or otherwise compromise Tax Certiorari Proceedings affecting real estate taxes assessed against the Premises on an Individual Property (i) for any fiscal period prior to the fiscal year in which the Closing shall occur without the prior consent of Purchaser as long as the same will not adversely affect the real estate taxes for subsequent years, and (ii) for the fiscal year in which the Closing shall occur, provided Purchaser shall have consented with respect thereto, which consent shall not be unreasonably withheld or delayed.  The amount of any tax refunds (net of attorneys' fees and other costs of obtaining such tax refunds) with respect to any portion of the Premises on such Individual Property for the tax year  in which the Cut-Off Time occurs shall be apportioned between Seller and Purchaser as of the Cut-Off Time with a prior allocation of any portion thereof which must be returned to tenants pursuant to the terms of the Leases; Sellers hereby agreeing to be responsible for the return of such refund to such tenants for the period up to and including the Cut-Off Time and Purchaser having such obligation for the return of such refunds attributable to the period from and after the Closing Date.  If, in lieu of a tax refund, a tax credit is received with respect to any portion of the 

	
			
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Premises of such Individual Property for the tax year in which the Cut-Off Time occurs or any subsequent year, then (x) within thirty (30) days after receipt by any Seller or Purchaser, as the case may be, of evidence of the actual amount of such tax credit (net of attorneys' fees and other costs of obtaining such tax credit), the tax credit apportionment shall be readjusted between Sellers and Purchaser, and (y) upon realization by Purchaser of a tax savings on account of such credit, Purchaser shall pay to Seller an amount equal to the savings realized (as apportioned and net of such attorneys' fees and costs of obtaining the same).  All refunds, credits or other benefits applicable to any fiscal period prior to the fiscal year in which the Closing shall occur shall belong solely to Seller (and Purchaser shall have no interest therein) and, if the same shall be paid to Purchaser or anyone acting on behalf of Purchaser, same shall be paid to Sellers within five (5) days following receipt thereof.  All refunds, credits or other benefits applicable to any fiscal period after the fiscal year in which the Closing shall occur shall belong solely to Purchaser (and Sellers shall have no interest therein) and, if the same shall be paid to Sellers or anyone acting on behalf of Sellers, same shall be paid to Purchaser within five (5) days following receipt thereof.  The provisions of this Section 15 shall survive the Closing. 
		
	16.
	TRANSFER TAXES; SALES TAXES; AND TRANSACTION COSTS. 

(a)    At the Closing, Seller and Purchaser shall execute, acknowledge, deliver and file (or deliver to the Title Company for filing) all such returns as may be necessary to comply with all laws and the regulations applicable thereto (collectively, as the same may be amended from time to time, the "Transfer Tax Laws").  The transfer taxes payable pursuant to the Transfer Tax Laws shall collectively be referred to as the "Transfer Taxes."  Purchaser and Sellers shall pay (or cause to be paid) to the appropriate governmental authority any and all Transfer Taxes payable in connection with the consummation of the transactions contemplated by this Agreement as more particularly set forth on Schedule Q attached hereto.
(b)    The Parties believe that no sales tax shall be due and payable in connection with the transfer contemplated by this Agreement, provided however, that should any sales taxes be due, Purchaser shall pay same together with all applicable interest and penalties thereon.
(c)    Purchaser and Sellers shall pay to the Title Company the premiums for title insurance for "owner's policies" (insuring the fee ownership of the Properties, or the leasehold interest with respect only to the Ground Lease Property) in connection with the consummation of the transactions contemplated by this Agreement as more particularly set forth on Schedule Q attached hereto.  Purchaser shall be responsible for one hundred percent (100%) of all title premiums in connection with any "lender's" title policies or leasehold title policies insuring a JV Entity's interest in the applicable Operating Lease that, in each case, is above and beyond the cost of the "owner's policies".
(d)    Sellers shall be responsible for (i) the costs of their legal counsel, advisors and other professionals employed by it in connection with the sale of the Properties, and (ii) such sums due to Manager in accordance with the management agreement(s) with the Manager  (collectively, the "Management Agreement") for periods prior to and after Closing (if applicable).

	
			
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(e)    Except as otherwise provided above, Purchaser shall be responsible for (i) the costs and expenses associated with its due diligence, (ii) the costs and expenses of its legal counsel, advisors and other professionals employed by it in connection with the sale of the Properties, (iii) all survey costs in connection therewith (other than the costs of the surveys included on the Datasite by Sellers), (iv) all costs and expenses incurred in connection with any financing obtained by Purchaser, including without limitation, loan fees, mortgage recording taxes, financing costs and lender's legal fees, (v) all escrow and/or closing fees, (vi) the Spread Maintenance Payment (as defined in the Loan Documents), and (vii) any recording fees for documentation to be recorded in connection with the transactions contemplated by this Agreement.
(f)    Purchaser shall indemnify and hold harmless the Seller from and against any loss incurred by Sellers to the extent resulting from any breach of any covenant of Purchaser set forth in this Section 16.  Sellers shall indemnify and hold harmless the Purchaser, the JV Entities and the Transferred Entities from and against any loss incurred by Purchaser to the extent resulting from any breach of any covenant of Sellers set forth in this Section 16.
(g)    The provisions of this Section 16 shall survive the Closing.
		
	17.
	DELIVERIES TO BE MADE ON THE CLOSING DATE.

(a)    Seller's Documents and Deliveries:  On the Closing Date, Sellers shall deliver or cause to be delivered to Purchaser the following:
(i)    Originals or, if originals are unavailable, copies of the Franchise Agreements, Leases, Contracts and the Ground Lease then in effect to the extent in Seller's possession;
(ii)     Originals or, if originals are unavailable, copies, of plans and specifications, technical manuals and similar materials for the Building to the extent same are in any Seller's possession;
(iii)    A duly executed certification from Sellers as to each Seller's nonforeign status as prescribed in Section 21, in the form of Exhibit 2;
(iv)    Assignments and assumptions of membership interests (the "JV Assignments") executed by Sellers (i.e., there shall be a separate JV Assignment for each Transferred Entity) in the form of Exhibit 3; 
(v)    Copies of all books and records relating to the operation of the Properties and maintained by any Seller, Transferred Entity or JV Entity, to the extent same are in any Seller's possession or control;
(vi)    Originals or, if originals are unavailable, copies, of all Permits and Licenses, to the extent same are in Seller's possession; 
(vii)    such affidavits and other deliveries as are required by the Title Company; 

	
			
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(viii)    documents that will satisfy all deliveries of any Seller or its affiliates listed in the requirements section of the title report;
(ix)    all other documents and items being conveyed, directly or indirectly,  to Purchaser pursuant to this Agreement; 
(x)    documents which shall effectuate the Mergers as provided in Section 2(a) above which are prepared by Purchaser and reasonably acceptable to Sellers; 
(xi)    evidence of each Seller's, the JV Entities' and the Transferred Entities'  (x) existence and good standing (including, without limitation, good standing certificates dated no earlier than thirty (30) days prior to the Closing Date) in their respective states of organization and any other state which any such Person does business; and (y) due authority to perform their respective obligations under this Agreement (and authority of the signatory to all documentation), in form and substance reasonably satisfactory to the Title Company (including, without limitation, consents, resolutions, incumbency certificates and copies of Organizational Documents of Sellers and such other Persons);
(xii)    Unconditional and irrevocable releases and resignations from all Persons designated by Sellers serving as officers, directors or managers or holding any other positions in respect of the JV Entities and/or the Transferred Entities;
(xiii)    Such other documents and instruments as may be reasonably necessary to consummate the transactions described herein; 
(xiv)    The Guest Ledger and all Hotel Guest Data and Information; 
(xv)    Updated Financials for quarter end dated March 31, 2014 and, to the extent produced in the ordinary course of business and is reasonably obtainable and accessible to Sellers without material expense, for the last month's Financials that were prepared by or on behalf of Sellers, in similar form previously delivered by Sellers but not certified by an accountant (but which, to Seller's Actual Knowledge, shall be true and correct in all material respects); 
(xvi)    At the Closing, Sellers shall deliver an instrument (the "Representation Update") advising Purchaser in what respects, if any, any Seller's Representations are inaccurate as of the Closing Date and, following the Closing, the applicable schedules to the Representations shall be deemed modified by the Representation Update.  Seller shall be deemed to have delivered the items set forth in clauses (i), (ii), (vi), and (vii) above if the same are left in the management office of the applicable Properties on the Closing Date; and
(xvii)    To the extent in the possession of Sellers, all limited liability company interest certificates representing ownership in the JV Entities (the "Interest 

	
			
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Certificates"), provided, however, that if any of the Interest Certificates are being held by the lenders under the Existing Mezzanine Debt, Sellers shall direct such lenders to deliver to Purchaser the applicable Interest Certificates or, if the applicable lender is unable to produce such, a "lost certificate affidavit" in such lender's customary form.
(b)    Purchaser's Documents and Deliveries:  On the Closing Date (unless otherwise noted), Purchaser shall execute and deliver to Sellers the JV Assignments and deliver or cause to be delivered to Seller the Payment of the balance of the Purchase Price payable at the Closing by 2:00 p.m., eastern time, on the Closing Date (time being of the essence), as adjusted for apportionments under Section 7 and elsewhere herein, in the manner required under this Agreement.
		
	18.
	CLOSING DATE.

(a)    The closing of the transactions contemplated hereunder (the "Closing") shall occur, and the documents referred to in Section 17 shall be delivered upon tender of the Purchase Price provided for in this Agreement, at 2:00 p.m., eastern time, on the date occurring on June 17, 2014 (such date, or the date Seller sets for the Closing if Seller shall elect to extend this date pursuant to the terms of this Agreement, being referred to in this Agreement as the "Scheduled Closing Date"; and the actual date of the Closing, the "Closing Date"), at the offices of Seller's attorneys, Schulte Roth & Zabel LLP, 919 Third Avenue, New York, New York 10022.
(b)    Sellers shall have the right, from time to time, by giving notice to Purchaser at least five (5) business days' prior to the then Scheduled Closing Date, to extend the Scheduled Closing Date one (1) or more times for fifteen (15) business days, provided, however, that Sellers shall not be entitled to adjourn the Scheduled Closing Date pursuant to this Section 18 or any other provision of this Agreement for a period or periods in excess of ninety (90) days in the aggregate (it being agreed that all adjournments by any Seller pursuant to this Section 18(b) shall require at least five (5) business days' advance notice).  If, on or before the Scheduled Closing Date, Purchaser has not obtained new franchise agreements from the Franchisors, Purchaser shall have the right, by giving notice to Sellers at least three (3) business days' prior to the then Scheduled Closing Date, to extend the Scheduled Closing Date one (1) or more times for thirty (30) days, provided, however, that notwithstanding the foregoing, it is expressly acknowledged and agreed by Purchaser that obtaining the new franchise agreements shall not be a condition precedent to Closing.  Time is of the essence as to the Purchaser's and Sellers' obligation to close the transactions contemplated hereunder on the Scheduled Closing Date (or, if Sellers or Purchaser shall have extended the Scheduled Closing Date pursuant to the terms of this Agreement so as to occur later than the Scheduled Closing Date, on such Scheduled Closing Date so designated by Sellers or Purchaser, as applicable).
		
	19.
	NOTICES.

All notices, demands, requests or other communications (collectively, "Notices") required to be given or which may be given hereunder shall be in writing and shall be sent by (a) certified or registered mail, return receipt requested, postage prepaid, or (b) national overnight delivery service, or (c) personal delivery, or (d) electronic mail (provided that the original of such 

	
			
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Notice is simultaneously delivered by one of the methods described in clauses (a)-(c)), addressed as follows: 
		
	(i)
	If to Sellers:

Cerberus Real Estate Capital Management, LLC
875 Third Avenue, 12th Floor
New York, New York 10022
Attention:  Tom Wagner 
email: twagner@cerberuscapital.com

with a copy to:

Schulte Roth & Zabel LLP 
919 Third Avenue 
New York, New York 10022
Attention:  Jeffrey A. Lenobel, Esq.
email: Jeffrey.Lenobel@srz.com
		
	(ii)
	If to Purchaser:

c/o NorthStar Realty Finance Corp.
399 Park Avenue, 18th Floor
New York, New York 10022
Attention: Dan Gilbert
email: gilbert@nrfc.com and patel@nrfc.com 

And

c/o NorthStar Realty Finance Corp.
399 Park Avenue, 18th Floor
New York, New York 10022
Attention: Ronald J. Lieberman, Esq.
email:  rlieberman@nrfc.com

And

Chatham Lodging Trust
50 Cocoanut Row, Suite 211
Palm Beach, Florida 33480
Attention:  Eric Kentoff, Esq.
email: ekentoff@cl-trust.com 

	
			
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with a copy to:
    
Duval & Stachenfeld LLP
555 Madison Avenue, 6th Floor
New York, New York 10022
Attention: Terri L. Adler, Esq. and File Manager
File No.: 3281.0044
email:  tadler@dsllp.com

And

Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
Attention:  Robin Panovka, Esq and Victor Goldfeld, Esq
email: rpanovka@wlrk.com and vgoldfeld@wlrk.com
		
	(iii)
	If given to the Escrow Agent:

Fidelity National Title Insurance Company
485 Lexington Avenue
New York, New York 10017
Attention:  Nick DeMartini
email:  NDeMartini@fnf.com
		
	(iv)
	If given to the Title Company:

Fidelity National Title Insurance Company
485 Lexington Avenue
New York, New York 10017
Attention:  Nick DeMartini
email:  NDeMartini@fnf.com 

Any Notice so sent by certified or registered mail, national overnight delivery service or personal delivery shall be deemed given on the date of receipt or refusal as indicated on the return receipt, or the receipt of the national overnight delivery service or personal delivery service.  Notices delivered by e-mail transmission shall be deemed given upon being sent provided such e-mail is sent on a business day on or before 5:00 p.m. (New York time); otherwise, an e-mail shall be deemed given the following business day.  A Notice may be given either by a Party or by such Party's attorney.  Seller or Purchaser may designate, by not less than five (5) business days' written notice given to the others in accordance with the terms of this Section 19, additional or substituted parties to whom Notices should be sent hereunder.
		
	20.
	DEFAULT BY PURCHASER OR SELLER.

	
			
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(a)    If Purchaser shall default in the payment of the Purchase Price or in the performance of any of its other obligations to be performed on the Closing Date, Sellers may elect, in their sole discretion, to terminate this Agreement and, upon such termination, Sellers shall retain the Deposit as liquidated damages for any and all claims for defaults, indemnification or otherwise hereunder, IT BEING AGREED BY SELLERS AND PURCHASER THAT, THE DAMAGES BY REASON OF ANY SUCH DEFAULT BY PURCHASER ARE DIFFICULT, IF NOT IMPOSSIBLE, TO ASCERTAIN, AND THE AMOUNT OF THE DEPOSIT IS THE PARTIES' BEST AND MOST ACCURATE ESTIMATE OF THE DAMAGES SELLER WOULD SUFFER.  ACCORDINGLY, THE PARTIES AGREE THAT, IN SUCH EVENT, THE DEPOSIT SHALL BE PAID BY THE ESCROW AGENT TO SELLERS AS LIQUIDATED DAMAGES, AND THAT SUCH PAYMENT IS REASONABLE UNDER THE CIRCUMSTANCES EXISTING AS OF THE EFFECTIVE DATE, AND UPON THE DELIVERY OF THE DEPOSIT TO SELLERS, THIS AGREEMENT SHALL BE DEEMED CANCELED AND OF NO FURTHER FORCE OR EFFECT, AND NO PARTY SHALL HAVE ANY FURTHER RIGHTS OR OBLIGATIONS HEREUNDER EXCEPT THOSE ARISING UNDER PROVISIONS OF THIS AGREEMENT THAT EXPRESSLY SURVIVE THE TERMINATION HEREOF.  NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN THIS AGREEMENT, SELLERS' SOLE AND EXCLUSIVE REMEDIES FOR ANY MATTER ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, INCLUDING, WITHOUT LIMITATION, ANY DEFAULT OR BREACH BY PURCHASER OF ANY REPRESENTATION, WARRANTY, COVENANT OR OBLIGATION SET FORTH IN THIS AGREEMENT, SHALL BE (1) THE RIGHT, SOLELY TO THE EXTENT EXPRESSLY PERMITTED IN THIS SECTION 20(a), TO TERMINATE THIS AGREEMENT AND RETAIN THE DEPOSIT, (2) SOLELY TO THE EXTENT EXPRESSLY PERMITTED IN SECTION 20(b), THE RIGHT TO PURSUE DAMAGES AGAINST PURCHASER, AND (3) THE RIGHT TO PURSUE INJUNCTIVE RELIEF PREVENTING BREACHES OF THE CONFIDENTIALITY PROVISIONS OF SECTION 29, AND NO SELLER MAY OTHERWISE OBTAIN ANY DAMAGES, AN INJUNCTION, SPECIFIC PERFORMANCE OR ANY OTHER LEGAL OR EQUITABLE RELIEF OR REMEDY AGAINST ANY PURCHASER RELATED PARTY IN CONNECTION WITH ANY MATTER ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.  SELLERS' RETENTION OF THE DEPOSIT AS LIQUIDATED DAMAGES IS NOT INTENDED AS A FORFEITURE OR PENALTY UNDER CALIFORNIA CIVIL CODE SECTIONS 3275 OR 3369, BUT INSTEAD, IS INTENDED TO CONSTITUTE LIQUIDATED DAMAGES TO SELLER PURSUANT TO SECTIONS 1671, 1676 AND 1677 OF THE CALIFORNIA CIVIL CODE.  BY THEIR SEPARATELY EXECUTING THIS SECTION 20(a) BELOW, PURCHASER AND SELLERS ACKNOWLEDGE THAT THEY HAVE READ AND UNDERSTOOD THE ABOVE PROVISION COVERING LIQUIDATED DAMAGES, AND THAT EACH PARTY WAS REPRESENTED BY COUNSEL WHO EXPLAINED THE CONSEQUENCES OF THIS LIQUIDATED DAMAGES PROVISION AT THE TIME THIS AGREEMENT WAS EXECUTED.

	
			
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	PURCHASER'S INITIALS
	 
	SELLERS' INITIALS

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(b)    If Seller validly terminates this Agreement pursuant to a right given to it hereunder after the expiration of the Due Diligence Period and Purchaser files any lis pendens or other form of attachment against any portion of the Properties (other than in connection with (i) a legal action timely commenced by Purchaser in good faith contesting Sellers' right to terminate this Agreement or (ii) pursuing remedies expressly provided for in this Agreement), then Purchaser shall be liable for all loss, cost, damage, liability or expense (including, without limitation, reasonable attorneys' fees, court costs and disbursements and consequential damages) incurred by Sellers by reason of such lis pendens or other form of attachment sought by Purchaser.  If (x) this Agreement is terminated following the expiration of the Due Diligence Period, (y) Sellers are not otherwise entitled to retain the Deposit as set forth in Section 20(a) above and (z) Purchaser has failed after the expiration of the Due Diligence Period to comply with any of its material obligations to be performed under this Agreement and such default continued for five (5) business days after notice to Purchaser, Sellers shall be entitled to recover from the Deposit their actual damages for Purchaser's default hereunder in an amount not to exceed Two Million Five Hundred Thousand Dollars ($2,500,000.00) (in the aggregate with respect to all matters under this Agreement for which it is stated that amounts may be withheld from the Deposit or that the Deposit secures an obligation of Purchaser other than as expressly provided in Section 20(a) above), and Purchaser and Escrow Agent acknowledge and agree that such amount shall be retained by Escrow Agent in escrow pursuant to the terms of Section 4 above until final resolution of the amount of Sellers' damages as a result of such breach (and the remainder of the Deposit shall be returned to Purchaser upon termination of this Agreement) and thereafter pay to Sellers the amount of such damages out of the Two Million Five Hundred Thousand Dollars ($2,500,000.00) (in the aggregate with respect to all matters under this Agreement for which it is stated that amounts may be withheld from the Deposit or that the Deposit secures an obligation of Purchaser other than as expressly provided in Section 20(a) above) (and the portion of such retained amount in excess of such damages shall be returned to Purchaser) and Sellers shall be entitled to pursue such damages by an action brought in a court of competent jurisdiction.
(c)    If (x) any Seller shall default in any of its obligations to be performed on the Closing Date or (y) any Seller shall default in the performance of any of its material obligations to be performed prior to the Closing Date and, with respect to any default under this clause (y) only, such default shall continue for five (5) business days after notice to Seller, Purchaser as its sole and exclusive remedy by reason thereof (in lieu of prosecuting an action for damages or proceeding with any other legal or equitable course of conduct, the right to bring such actions or proceedings being expressly and voluntarily waived by Purchaser, to the extent legally permissible, following and upon advice of its counsel) shall have the right subject to the other provisions of this Section 20(c) (i) to seek to obtain specific performance of Sellers' obligations hereunder, provided that any action for specific performance shall be commenced within sixty (60) days after such default, and, if Purchaser prevails thereunder, Sellers shall reimburse Purchaser for all reasonable legal fees, court costs and all other reasonable costs of such action or (ii) to terminate this Agreement and receive a return of the Deposit (together with any interest earned thereon) (in which event this Agreement shall be deemed canceled and of no further force or effect, and no Party shall have any further rights or obligations hereunder except for those arising under provisions of this Agreement that expressly survive the termination hereof), it being understood that if Purchaser fails to commence an action for specific performance within sixty (60) days after such default, Purchaser's 

	
			
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sole and exclusive remedy shall be to terminate this Agreement and receive a return of the Deposit (together with any interest earned thereon).  Sellers hereby waive any requirements for the posting of any bond or any other security in connection with any remedy contemplated by this Section 20(c).  If Purchaser elects to seek specific performance of this Agreement, then as a condition precedent to any suit for specific performance, Purchaser shall on or before the Closing Date, time being of the essence, fully perform all of its obligations hereunder which are capable of being performed (other than the payment of the Purchase Price, which shall be paid as and when required by the court in the suit for specific performance).  In addition, if Purchaser commences an action for specific performance but is unsuccessful in obtaining a judgment for specific performance then Purchaser shall pay Seller's reasonable legal fees, court costs and expenses incurred in connection therewith.  Notwithstanding anything herein to the contrary, if the default in question is caused by the bad faith, willful and/or intentional act or omission of Seller and if Purchaser has elected to terminate this Agreement under subsection (ii) above, then Sellers shall reimburse Purchaser for the actual out-of-pocket costs and expenses incurred by Purchaser in connection with the transactions including Purchaser's due diligence investigation of the Property and the legal fees and expenses of and court and other costs and expenses of preparing, negotiating and enforcing this Agreement, which reimbursement obligation shall not exceed an amount equal to One Million Dollars ($1,000,000) in the aggregate.  
(d)    The provisions of this Section 20 shall survive the termination hereof.
		
	21.
	FIRPTA COMPLIANCE.

Sellers shall comply with the provisions of the Foreign Investment in Real Property Tax Act, Section 1445 of the Code ("FIRPTA").  Sellers hereby represent and warrant that each Seller is not a foreign person as that term is defined in the Code and Income Tax Regulations.  On the Closing Date, Sellers shall deliver to Purchaser a certification as to each Seller's non-foreign status in the form of Exhibit 2, and shall comply with any temporary or final regulations promulgated with respect thereto and any relevant revenue procedures or other officially published announcements of the Internal Revenue Service of the U.S. Department of the Treasury in connection therewith.
		
	22.
	ENTIRE AGREEMENT; ACCEPTANCE OF JV ASSIGNMENTS.

(1)    This Agreement contains all of the terms agreed upon between Sellers and Purchaser with respect to the subject matter hereof, and all prior agreements, understandings, representations and statements, oral or written, between any Seller and Purchaser are merged into this Agreement.
(1)    All agreements, covenants, liabilities, indemnities, representations, warranties and other obligations of Seller under this Agreement shall merge with the JV Assignments and have no further effect or validity after Closing, and the acceptance of the JV Assignments by Purchaser shall be deemed full compliance by Seller with all of Seller's obligations hereunder and an acknowledgement and agreement by Purchaser that Seller is discharged therefrom and shall have 

	
			
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no further obligation or liability with respect thereto, except for those provisions of this Agreement which expressly shall survive or are intended to survive the Closing.
(1)    The provisions of Section 22(a) shall survive the Closing or the termination hereof.  The provisions of Section 22(b) shall survive the Closing.
		
	23.
	AMENDMENTS.

This Agreement may not be changed, modified or terminated, except by an instrument executed by Seller, Purchaser and Chatham LP.  The provisions of this Section 23 shall survive the Closing or the termination hereof.
		
	24.
	WAIVER.

No waiver by either Party of any failure or refusal by the other Party to comply with its obligations shall be deemed a waiver of any other or subsequent failure or refusal to so comply.  No waiver by Chatham LP of any failure or refusal by a Party to comply with its obligations as they relate to the Specified Hotel Transaction shall be deemed a waiver of any other or subsequent failure or refusal to so comply.  No subsequent waiver by any party under this Agreement shall be effective unless in writing. The provisions of this Section 24 shall survive the Closing or the termination hereof.
		
	25.
	PARTIAL INVALIDITY.

If any term or provision of this Agreement or the application thereof to any person or circumstance shall, to any extent, be invalid or unenforceable, the remainder of this Agreement, or the application of such term or provision to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and each term and provision of this Agreement shall be valid and shall be enforced to the fullest extent permitted by law.  The provisions of this Section 25 shall survive the Closing or the termination hereof.
		
	26.
	SECTION HEADINGS.

The headings of the various sections of this Agreement have been inserted only for the purposes of convenience, and are not part of this Agreement and shall not be deemed in any manner to modify, explain, expand or restrict any of the provisions of this Agreement.  The provisions of this Section 26 shall survive the Closing or the termination hereof.
		
	27.
	GOVERNING LAW.

This Agreement shall be governed by the laws of the State of New York without giving effect to conflict of laws principles thereof that would result in the application of the laws of another jurisdiction.  The provisions of this Section 27 shall survive the Closing or the termination hereof.
		
	28.
	PARTIES; ASSIGNMENT AND RECORDING. 

	
			
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(a)    This Agreement and the various rights and obligations arising hereunder shall inure to the benefit of and be binding upon Seller and Purchaser and their respective successors and permitted assigns; provided, however, that none of the representations or warranties made by Seller hereunder shall inure to the benefit of any person or entity that may, after the Closing Date, succeed to Purchaser's interest in the Properties.
(b)    Purchaser may not assign or otherwise transfer this Agreement (and any transfer of the direct or indirect ownership interests in Purchaser shall constitute an impermissible assignment for the purposes hereof except as provided below), without first obtaining Seller's consent thereto.  Notwithstanding the foregoing, Purchaser shall have the right to (one or more times, to one or more entities, in whole or in part) assign Purchaser's rights and/or obligations under this Agreement to Chatham LP, NRFC Sub-REIT Corp. and/or any of their respective Affiliates  (any such entity, herein "Purchaser's Permitted Assignee"), without consent of Sellers, provided that within five (5) Business Days prior to Closing, Purchaser delivers to Sellers the identity of each Purchaser's Permitted Assignee to whom any such assignment will be made (and for the avoidance of doubt, direct and indirect transfers of ownership interests in Purchaser or its assignee(s) shall be freely permissible, provided that Chatham Lodging Trust and/or NRFC Sub-REIT Corp. and/or Affiliates of either or both thereof shall own a majority of the direct or indirect interests in and control Purchaser or such assignee and the same shall not constitute an impermissible assignment hereunder). The parties shall execute separate closing documents as to each separate assignment permitted hereunder if so requested by Purchaser.  Additionally, Purchaser shall not be relieved of any of its obligations hereunder as a result of such assignment. Notwithstanding anything in this Agreement to the contrary, to the extent that any direct or indirect owner of any ownership interest in Purchaser or Purchaser's Permitted Assignee (or any affiliate thereof) is a public company or REIT or operating partnership, there shall be no restriction (and no requirement for any Seller’s consent) with respect to any reorganization, merger, consolidation, recapitalization, conversion, spin-off, transfer, sale, assignment, pledge, hypothecation, disposition, redemption or change in stock, or any other transaction that modifies, changes, or affects the ownership or control of such public company, REIT, operating partnership or their respective assets.
(c)    Neither this Agreement nor any memorandum hereof may be recorded without first obtaining Seller's consent thereto.  Any breach of the provisions of this clause (c) shall constitute a default by Purchaser under this Agreement.  Purchaser agrees not to file any lis pendens or other instrument against all or a portion of the Premises in connection herewith other than in connection with a specific performance action timely commenced by Purchaser in accordance with Section 20(c).  In furtherance of the foregoing, Purchaser (i) acknowledges that the wrongful filing of a lis pendens or other evidence of Purchaser's rights or the existence of this Agreement against all or a portion of the Premises could cause significant monetary and other damages to Sellers and (ii) hereby agrees to indemnify Sellers from and against any and all claims, losses, liabilities and expenses (including, without limitation, reasonable attorneys' fees incurred in the enforcement of the foregoing indemnification obligation) arising out of the breach by Purchaser of any of its obligations under this clause (c) other than in connection with Purchaser's exercise of the remedies described in Sections 20(b)(i) or (ii).

	
			
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(d)    The provisions of Section 28(a) and 28(c) shall survive the Closing or the termination hereof.  The provisions of Section 28(b) shall survive the termination hereof.
		
	29.
	CONFIDENTIALITY AND PRESS RELEASES.

(a)    Until the Closing, the terms of this Agreement and any information disclosed to Purchaser by Sellers or otherwise gained through Purchaser's access to the Properties and Sellers' books and records shall be subject to that certain Confidentiality Agreement (the "Confidentiality Agreement"), dated February 12, 2014, between ND Investment-T, LLC, an affiliate of Purchaser, and Sellers' Broker with respect to the Properties, the terms of which are incorporated herein by reference as modified below.  Notwithstanding anything contained to the contrary herein or in the Confidentiality Agreement, (1) at all times Purchaser may disclose Informational Materials and the existence and terms of this Agreement to Purchaser’s Representatives in connection with their participation in the transactions contemplated in this Agreement, provided, however, Purchaser shall notify such Purchaser's Representatives of the confidential nature of such information and Purchaser shall remain liable for any breach of the Confidentiality Agreement or this Section 29 by such Purchaser's Representatives, and (2) Purchaser shall not disclose the existence or terms of this Agreement (other than pursuant to clause (1) above) prior to the expiration of the Due Diligence Period and the payment of the Additional Deposit, except that such terms, existence, materials and information at all times may be disclosed (x) if in the advice of counsel to the disclosing party, disclosure is required to comply with any mandatory provision of law, of any directive from a government recognized stock exchange, or of a binding decision from a court or another government body, or (y) if required by subpoena issued in connection with any litigation or proceeding; provided, however, with respect to  any disclosure that may made pursuant to clauses (x) or (y) above prior to the expiration of the Due Diligence Period, to the extent not legally prohibited, the disclosing party will give the other party prompt written notice of such requirement so that an appropriate protective order or other remedy may be sought, and/or compliance with the provisions of this Section 29 may be waived, and the Parties will reasonably cooperate with each other to obtain such protective order.  In the event that, with respect to the matters described in clauses (x) or (y) above, such protective order or other remedy is not obtained or compliance with the relevant provisions of the Confidentiality Agreement (as modified by this Section 29) is not waived, the disclosing party will furnish only that portion of the information that it is advised by legal counsel that it is legally required to be disclosed.  Notwithstanding anything contained to the contrary herein or in the Confidentiality Agreement, following the expiration of the Due Diligence Period, if this Agreement remains in full force and effect and Purchaser has delivered the Additional Deposit to the Escrow Agent, and not before then (other than as set forth in clauses (1) and (2) above), Purchaser and Sellers may disclose the existence  and terms of this Agreement and Informational Materials (i) to the extent required by an applicable statute, law, regulation, governmental authority or securities exchange; (ii) to the extent required by Purchaser's reporting or other filing requirements under the rules and regulations of the Securities and Exchange Commission, including, without limitation, to the extent disclosure is required on Form 8(k) with respect to the transaction contemplated hereby or as required by any securities exchange, (iii) which is otherwise publicly known or available other than as a result of the breach of either the Confidentiality Agreement or this Section 29, (iv) if in the opinion of counsel to the disclosing party, disclosure is required to comply with any mandatory provision of law, of any directive from a 

	
			
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government recognized stock exchange, or of a binding decision from a court or another government body, (v) with respect to generic disclosures about business and pipeline of the Purchaser or any affiliate of the Purchaser made in the ordinary course of business that would not reasonably be expected to identify Seller, (vi) in connection with any corporate presentations, earnings calls, earnings releases, press releases (such press releases to be issued as provided by paragraph b(ii) of this Section 29), investor reports, investor conference calls or investor meetings which may include, without limitation, disclosure of economic terms and such other matters relating to the transaction which Purchaser determines is necessary or appropriate, or (vii) if required by subpoena issued in connection with any litigation or proceeding; provided, however, that any disclosure that may made pursuant to this subclause (vii) to the extent not legally prohibited, the disclosing party will give the other party prompt written notice of such requirement so that an appropriate protective order or other remedy may be sought, and/or compliance with the provisions of this Section 29 may be waived, and the parties will reasonably cooperate with each other to obtain such protective order.  In the event that, with respect to the matters described in clause (vii) above, such protective order or other remedy is not obtained or compliance with the relevant provisions of the Confidentiality Agreement (as modified by this Section) is not waived, the disclosing party will furnish only that portion of the information that it is advised by legal counsel that it is legally required to be disclosed.  Any disclosure made pursuant to this Section 29(a)(i), (ii), (iv), or (vii) shall be of only that portion of the information that is required to be disclosed.
(b)    Except for disclosures which may be (i) permitted by the Confidentiality Agreement, or (ii) of information that is otherwise already publicly available, other than as a result of a breach of the Confidentiality Agreement or this Section 29, Purchaser and Sellers shall confer and afford one another a reasonable opportunity to review and provide reasonable comment on any press release to be issued by Purchaser and/or Sellers disclosing the transaction or any of its economic terms and the appropriate time for making such release (but the contents of any such press release will ultimately be determined by the party issuing or providing same and the foregoing shall not constitute a consent right).  Except for disclosures required by applicable law, the parties will not disclose in any press release the identity of the other party (nor that of its respective parent) without the consent of such party to be so disclosed which consent shall not be unreasonably withheld.
(c)    Notwithstanding the foregoing, Purchaser shall be permitted to disclose information to prospective lenders and franchisors, provided that the disclosure to such lenders and franchisors is solely in their capacity as a lender or franchisor, as applicable, to Purchaser in connection with the transactions contemplated by this Agreement and provided further that Purchaser informs such lenders or franchisor, as applicable, that the shared information is subject to a confidentiality agreement and further directs such lenders or franchisor, as applicable, to maintain the confidentiality thereof.
(d)    The provisions of this Section 29 shall survive the termination of this Agreement or Closing except the provisions of this Section 29 and the Confidentiality Agreement, as to Purchaser, shall terminate at the Closing.
		
	30.
	FURTHER ASSURANCES.

	
			
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Sellers and Purchaser will do, execute, acknowledge and deliver all and every such further acts, deeds, conveyances, assignments, notices, transfers and assurances as may be reasonably required by the other Party, for the better assuring, conveying, assigning, transferring and confirming unto Purchaser the Transferred Interests and, indirectly, the JV Interests and the Properties and for carrying out the intentions or facilitating the consummation of this Agreement.  The provisions of this Section 30 shall survive the Closing.
		
	31.
	THIRD PARTY BENEFICIARY.

This Agreement is an agreement solely for the benefit of Seller and Purchaser (and their permitted successors and/or assigns).  No other person, party or entity shall have any rights hereunder nor shall any other person, party or entity be entitled to rely upon the terms, covenants and provisions contained herein.  The provisions of this Section 31 shall survive the Closing or the termination hereof.
		
	32.
	JURISDICTION AND SERVICE OF PROCESS.

The Parties hereto agree to submit to personal jurisdiction in the State of New York in any action or proceeding arising out of this Agreement and, in furtherance of such agreement, the Parties hereby agree and consent that without limiting other methods of obtaining jurisdiction, personal jurisdiction over the Parties in any such action or proceeding may be obtained within or without the jurisdiction of any court located in New York and that any process or notice of motion or other application to any such court in connection with any such action or proceeding may be served upon the Parties by registered or certified mail to or by personal service at the last known address of the Parties, whether such address be within or without the jurisdiction of any such court.  Any legal suit, action or other proceeding by one party to this Agreement against the other arising out of or relating to this Agreement (other than any dispute which, pursuant to the express terms of this Agreement, is to be determined by arbitration) shall be instituted only in the Supreme Court of the State of New York, County of New York or the United States District Court for the Southern District of New York, and each Party hereby waives any objections which it may now or hereafter have based on venue and/or forum non-conveniens of any such suit, action or proceeding and submits to the jurisdiction of such courts.  The provisions of this Section 32 shall survive the Closing or the termination hereof.
		
	33.
	WAIVER OF TRIAL BY JURY.

Sellers and Purchaser hereby irrevocably and unconditionally waive any and all right to trial by jury in any action, suit or counterclaim arising in connection with, out of or otherwise relating to this agreement.  The provisions of this Section 33 shall survive the Closing or the termination hereof.
		
	34.
	ATTORNEYS' FEES.

If any legal action, arbitration or other proceeding is commenced to enforce or interpret any provision of this Agreement, the prevailing party shall be entitled to an award of its 

	
			
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reasonable attorneys' fees and expenses as part of its judgment.  The provisions of this Section 34 shall survive the Closing or the termination hereof.
		
	35.
	EXCULPATION.

(a)    Purchaser agrees that it does not have and will not have any claims or causes of action against any Seller Related Parties (other than Guarantor to the extent applicable pursuant to this Agreement) other than a claim or cause of action against Sellers, solely to the extent expressly permitted in Sections 20(c) or 34 or injunctive relief) arising out of or in connection with this Agreement or the transactions contemplated hereby.  After the Closing, Purchaser agrees to look solely to the Guaranty, the Representations Insurance Policy (if applicable) and injunctive relief for the satisfaction of any liability or obligation arising under this Agreement or the transactions contemplated hereby, or for the performance of any of the covenants, warranties, indemnities or other agreements contained herein, and further agrees not to sue or otherwise seek to enforce any personal obligation against any Seller Related Parties (other than Guarantor to the extent applicable pursuant to this Agreement) (other than a claim or cause of action against Sellers, solely to the extent expressly permitted in Sections 20(c) or 34, or injunctive relief) with respect to any matters arising out of or in connection with this Agreement or the transactions contemplated hereby.  Without limiting the generality of the foregoing provisions of this Section 35(a), Purchaser hereby unconditionally and irrevocably waives any and all claims and causes of action of any nature whatsoever it may now or hereafter have against the Seller Related Parties ((other than Guarantor to the extent applicable pursuant to this Agreement) other than a claim or cause of action against Sellers, solely to the extent expressly permitted in Sections 20(c) or 34 or injunctive relief), and hereby unconditionally and irrevocably releases and discharges the Seller Related Parties (other than Guarantor to the extent applicable pursuant to this Agreement) from any and all liability whatsoever which may now or hereafter accrue in favor of Purchaser against any Seller Related Parties (other than Guarantor to the extent applicable pursuant to this Agreement) (other than a claim or cause of action against Sellers, solely to the extent expressly permitted in Sections 20(c) or 34 or injunctive relief), in connection with or arising out of this Agreement or the transactions contemplated hereby (other than Guarantor to the extent applicable pursuant to this Agreement) (other than a claim or cause of action against Sellers, solely to the extent expressly permitted in Sections 20(c) or 34 or injunctive relief).  The provisions of this Section 35(a) shall survive the termination of this Agreement and the Closing.
(b)    Sellers agree that they do not have and will not have any claims or causes of action against any Purchaser Related Party (other than a claim or cause of action (i) against Purchaser seeking all or a portion of the Deposit, solely to the extent expressly permitted in Sections 20(a) and (b), (ii) against Purchaser, solely to the extent expressly permitted in Section 20(b) arising out of or in connection with this Agreement or the transactions contemplated hereby or (iii) following the Closing, against Purchaser or any Purchaser's Permitted Assignees to whom an assignment is made pursuant to Section 28).  Sellers agree to look solely to (i) the Deposit, solely to the extent expressly permitted in Section 20(a), (ii) to Purchaser and its assets, solely to the extent expressly permitted in Section 20(b), for the satisfaction of any liability or obligation arising under this Agreement or the transactions contemplated hereby, or for the performance of any of the covenants, warranties, indemnities or other agreements contained herein, and further agree not to sue or 

	
			
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otherwise seek to enforce any personal obligation against any Purchaser Related Party (other than a claim or cause of action (x) against Purchaser seeking all or a portion of the Deposit, solely to the extent expressly permitted in Sections 20(a) and (b), (y) against Purchaser, solely to the extent expressly permitted in Section 20(b) with respect to any matters arising out of or in connection with this Agreement or the transactions contemplated hereby or (z) following the Closing, against Purchaser or any Purchaser's Permitted Assignees to whom an assignment is made pursuant to Section 28).  Without limiting the generality of the foregoing provisions of this Section 35(b), Sellers hereby unconditionally and irrevocably waive any and all claims and causes of action of any nature whatsoever they may now or hereafter have against the Purchaser Related Parties (other than a claim or cause of action (x) against Purchaser seeking all or a portion of the Deposit, solely to the extent expressly permitted in Sections 20(a) and (b), (y) against Purchaser, solely to the extent expressly permitted in Section 20(b), or (z) following the Closing, against Purchaser or any Purchaser's Permitted Assignee to whom an assignment is made pursuant to Section 28) and hereby unconditionally and irrevocably release and discharge the Purchaser Related Parties from any and all liability whatsoever which may now or hereafter accrue in favor of Sellers against the Purchaser Related Parties, in connection with or arising out of this Agreement or the transactions contemplated hereby (other than a claim or cause of action (x) against Purchaser seeking all or a portion of the Deposit, solely to the extent expressly permitted in Sections 20(a) and (b), (y) against Purchaser, solely to the extent expressly permitted in Section 20(b) or (z) following the Closing, against Purchaser or any Purchaser's Permitted Assignee to whom an assignment is made pursuant to Section 28).  The provisions of this Section 35(b) shall survive the termination of this Agreement and the Closing.  For purposes of this Agreement, "Purchaser Related Party" means Purchaser and Purchaser's Permitted Assignees and each of their respective disclosed or undisclosed, direct and indirect, shareholders, officers, directors, trustees, partners, principals, members, employees, agents, affiliates, representatives, consultants, accountants, contractors and attorneys or other advisors, and any successors or assigns of any of the foregoing and Manager.
		
	36.
	RIGHT OF FIRST OFFER.

Purchaser acknowledges that Hyatt House Franchising, L.L.C. ("Hyatt") has a retained a right of first offer (a "ROFO") pursuant to each of the Franchise Agreements between Hyatt and Grand Prix Fixed LLC, dated as of October 27, 2011 (collectively, the "Hyatt Franchise Agreements").  If Hyatt exercises any of its ROFO rights pursuant to the applicable Franchise Agreement (or fails to waive the same in writing), with respect to the Properties that are subject to a ROFO (each a "ROFO Property"), then the Purchase Price shall be deemed reduced by the portion of the Purchase Price allocated to such ROFO Properties on Schedule B-1, the Properties being conveyed pursuant to this Agreement shall no longer be deemed to include the ROFO Properties and this Agreement shall be deemed canceled and of no further force or effect with respect to such ROFO Properties only, and no Party hereto shall have any further rights or obligations hereunder with respect to such ROFO Properties, except those arising under provisions of this Agreement that expressly survive the termination hereof. Promptly  after the date hereof, Seller shall send Hyatt the notices required under the Hyatt Franchise Agreements in respect of the ROFO and keep Purchaser reasonably apprised of the status thereof.  Notwithstanding the foregoing, Purchaser represents and warrants that it has obtained a waiver of the Hyatt ROFO from Hyatt and Sellers are under no obligation to comply with the Hyatt ROFO requirements. 

	
			
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	37.
	INTENTIONALLY OMITTED.

		
	38.
	HOTEL EMPLOYEES. 

(a)    Hotel Employees. Purchaser agrees that if it terminates Manager, Purchaser shall assume, and/or cause its hotel manager, if any, to assume the Union Contract, in accordance with its respective terms.  Seller shall deliver, or cause Manager to deliver, as and when required under the Union Contract, any notices required thereunder in connection with the transactions contemplated hereby (and shall concurrently provide a copy of such notices to Purchaser).  If Purchaser causes the Operating Lessees to terminate the Management Agreement, Purchaser agrees to retain, or causes its designated hotel manager to retain, all current Bargaining Unit Employees subject to the terms of the Union Contract and applicable law.  "Bargaining Unit Employees" shall mean all Hotel Employees retained to provide services at the Individual Property covered by the Union Contract.  Purchaser acknowledges that it has received copies of the Union Contract and that at or prior to the Closing, Purchaser shall cause the manager of the Individual Property covered by the Union Contract to recognize and assume all of Manager's obligations arising after the Closing Date under the Union Contract with respect to the Bargaining Unit Employees, including any obligations owed to the Bargaining Unit Employees with respect to their benefits set forth in the Union Contract.  Purchaser further agrees to execute (and cause its manager to execute) a copy of any assumption documents or other documents, if any, as are required to assume the obligations under the Union Contract including, without limitation, the form of Assumption Agreement set forth in Article XXX of the Union Contract.  Sellers warrant that other than the Union Contract referenced in this Section 38(a), no other collective bargaining agreements or other union contracts exist that pertain to the Properties or employees at the Properties.  Sellers further warrant that, except as set forth on Schedule G attached hereto, to their Knowledge with respect to the Properties there are no: (i) other negotiations with any trade union or employee organization other than the Union that is a party to the Union Contract; (ii) unfair labor practices within the meaning of the United States National Labor Relations Act, and there is no pending or threatened complaint regarding any alleged unfair labor practices; (iii) strikes, material labor disputes, or material work slowdowns or stoppages pending or threatened with regard to any of Manager's employees working at the Properties, including the Bargaining Unit Employees (the "Hotel Employees"); (iv) material grievances or arbitration proceedings arising out of or under any collective bargaining agreement; (v) union organizing; and (vi) Sellers are in compliance in all material respects with laws governing the employment of labor.  Sellers agree to use commercially reasonable efforts to instruct Manager to keep Purchaser apprised of all developments with any union or labor organization during the period between the Effective Date and Closing of this Agreement.
(b)    Scheduling.  The Parties agree to reasonably cooperate in scheduling and otherwise handling matters relating to Hotel Employees pursuant to this Section 38(b), so as to minimize prior to the Closing, any potential employee morale problems arising from the transfer of the ownership of the Properties to Purchaser and any resulting disruption to the Properties, services or the quality thereof.  During the period prior to the Closing, the Parties shall also consult on a regular basis and coordinate activities relating to employee matters so as to facilitate 

	
			
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a smooth transition of the property operations and the continued proper performance by the Hotel Employees of their respective duties up to the Closing.
(c)    Employee Benefit Funds.  Manager currently contributes various amounts to a pension fund (the "Pension Fund") and welfare fund (collectively, the "Employee Benefit Funds") pursuant to the terms of the Union Contract.  Sellers warrant that other than the Pension Fund referenced in this Section 38(c), neither JV Entities nor Manager contribute or are obligated to contribute to any other multiemployer pension funds for the benefit of any Hotel Employees.  As soon as practicable, Sellers shall instruct Manager to use commercially reasonable efforts to obtain from the Pension Fund an estimate of withdrawal liability and notify Purchaser of the amount of such estimate.  Sellers warrant that to their Actual Knowledge, there has been no withdrawal or planned withdrawal from the Pension Fund by Manager with respect to the Hotel Employees and that they have not taken and will not take any actions to encourage or induce a withdrawal from the Pension Fund by Manager with respect to the Hotel Employees.
(d)    No Third Party Beneficiary.  Nothing contained in this Section 38 shall confer any rights or remedies upon any employee or former employee of the Sellers or Manager or upon any other Person other than the parties hereto and their respective successors and assigns, and no provision of this Section is intended to amend, or to be an amendment to, any benefit plan.
(e)    Cooperation.  Purchaser agrees to cooperate with Sellers and/or the Union and/or Employee Benefit Funds and/or the Pension Benefit Guaranty Corporation (the "PBGC") with respect to any reasonable inquiry or request for information and assistance in connection with this Agreement.
(f)    Parties' Indemnity.  The Sellers shall indemnify and hold the Purchaser, the Transferred Entities and the JV Entities and the Purchaser shall indemnify and hold the Sellers and Manager, harmless from and against any loss incurred as a result of its breach  of any of the provisions of this Section 38.
(g)    Sellers shall indemnify and hold Purchaser, the Transferred Entities and the JV Entities harmless from and against any loss and/or costs incurred as a result of the Martinez/Rodriguez/Mercado wage and hour litigation set forth on Schedule G attached hereto (including, without limitation, as a result of any indemnity claim by Manager against the Purchaser, the Transferred Entities or the JV Entities in connection therewith); provided, however, that Purchaser shall not, or cause or permit any JV Entity to, settle or agree to be liable for any indemnity claim made by Manager against any JV Entity or Transferred Entity that may result in Seller having to make a payment to Purchaser pursuant to this Section 38(g) without the prior written approval of Seller.  If Manager commences a litigation or other proceeding against a JV Entity or Transferred Entity with respect to such an indemnity claim for which Seller may have to make a payment to Purchaser pursuant to this Section 38(g), Purchaser shall promptly notify Seller thereof and Seller shall have the right to participate in the defense of such claim and shall be entitled, without requiring the consent or approval of Purchaser, to settle any such claims as they may relate to periods of time prior to the Closing.

	
			
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(h)    Survival.  The Parties' covenants and obligations contained in this Section 38 shall survive the Closing.
		
	39.
	BOOKINGS AND INFORMATION. 

(a)    Bookings.  Purchaser shall cause the Individual Owners and Operating Lessees, as applicable, to honor all Bookings made in the Ordinary Course of Business prior to the Closing Date for any period on or after the Closing Date, including, without limitation, any Bookings by any person in redemption of any benefits accrued under any preferred guest program. This Section 39(a) shall survive the Closing.
(b)    Notices and Filings.  Seller and Purchaser shall use commercially reasonable efforts to cooperate with each other (at no cost or expense to the party whose cooperation is requested, other than any de minimis cost or expense or any cost or expense which the requesting party agrees in writing to reimburse) to provide written notice to any person under any Contracts, and to effect any registrations or filings with any governmental authority or other person, regarding the change in ownership of the Properties or the Business. This Section 39(b) shall survive the Closing. 
(c)    Access to Information.  For a period of six (6) years and one (1) month following the Closing, Purchaser shall provide to the officers, employees, agents and representatives of any Sellers reasonable access to (the "Post-Closing Information") (i) the non-confidential and non-proprietary Books and Records with respect to the Properties, (ii) the Properties, to prepare any documents required to be filed by Seller under applicable law or to investigate, evaluate and defend any third-party claim or audit or inquiry by any governmental authority or insurance company, and (iii) to make electronic copies in connection with clauses (i) and (ii) above; provided, however, that (A) Seller shall provide reasonable prior notice to Purchaser; (B) Purchaser shall not be required to provide such access during non-business hours; (C) Purchaser shall have the right to accompany the officer, employees, agents or representatives of Seller in providing access to the Books and Records or the Properties; (D) such access shall not be permitted with respect to any such documents or materials that (i) are legally privileged or constitute attorney work product, (ii) are subject to a third party confidentiality agreement or to applicable law prohibiting their disclosure by Purchaser, (iii) constitute confidential internal assessments, reports, studies, memoranda, notes or other correspondence prepared by or on behalf of any officer or employee of Purchaser, or (iv) are otherwise related to the subject matter of any claim or litigation between Purchaser and Seller. Purchaser, at its cost and expense, shall use commercially reasonable efforts to retain all Books and Records with respect to the Properties for a period of six (6) years and one (1) month following the Closing; and (E) Sellers shall keep such information relating to the Books and Records confidential, provided that Sellers may disclose such information to Seller Related Parties and Sellers shall be under no duty to keep such information confidential to the extent that such information (i) was or becomes available to Sellers or Seller Related Parties on a non-confidential basis from a person not reasonably believed by Sellers or Seller Related Parties to be under an obligation (whether contractual, legal or fiduciary) of confidentiality to Purchaser, (ii) any information or materials which Sellers or Seller Related Parties reasonably believe were in Sellers or Seller Related Parties' possession, as applicable, prior to the receipt of such information from 

	
			
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the Purchasers, (iii) any information which is or hereafter becomes part of the public domain without any violation by Sellers or Seller Related Parties, (iv) any information Sellers or Seller Related Parties reasonably believe was independently produced by Sellers or Seller Related Parties, as applicable, without any reliance upon the information and if required by court order or subpoena issued in connection with any litigation or proceeding.  This Section 39(c) shall survive the Closing. 
(d)    Privacy Laws.  To the extent Purchaser reviews, is given access to or otherwise obtains any Hotel Guest Data and Information as part of the purchase of the Properties and the Business, Purchaser shall, with respect to information initially obtained by Sellers or Manager and provided to Purchaser, comply in all material respects with all applicable laws concerning (i) the privacy and use of such Hotel Guest Data and Information, Hotel Employee information and the sharing of such information and data with third parties (including, without limitation, any restrictions with respect to Purchaser's or any third party's ability to use, transfer, store, sell, or share such information and data), and (ii) the establishment of adequate security measures to protect such Hotel Guest Data and Information and Hotel Employee information. "Hotel Guest Data and Information" means all guest or customer profiles, contact information (e.g., addresses, phone numbers, facsimile numbers and email addresses), histories, preferences and any other guest or customer information in any database of Seller, whether obtained or derived by Seller from: (a) guests or customers of the Properties or any facility associated with the Properties; (b) guests or customers of any other hotel or lodging properties (including any condominium or interval ownership properties) owned, leased, operated, managed, licensed or franchised by Seller, or any facility associated with such hotels or other properties (including restaurants, golf courses and spas); or (c) any other sources and databases, including the Franchisors' or Manager's brand websites and Franchisors' or Manager's central reservations database and operational data base.  This Section 39(d) shall survive the Closing.
(e)    Franchise Agreements.  From and after the expiration of the Due Diligence Period, Purchaser shall be responsible for providing all information requested by each Franchisor, and Purchaser shall pay all fees, costs and expenses associated with obtaining consent to the proposed transfer from each Franchisor.  If any Franchisor fails to provide consent and such Franchise Agreement is terminated or other penalties are imposed, this Agreement shall not be terminated and Purchaser shall remain obligated to purchase the applicable Properties without abatement or proration in the Purchase Price, and Purchaser shall be responsible for all amounts payable to such Franchisor as a result of such lack of consent or termination of the Franchise Agreement including, without limitation, all penalties, fees, costs and expenses in connection therewith.
(f)    Bulk Sales.  Following the Effective Date, Sellers shall notify (each, a "Bulk Sales Filing") the applicable governmental agencies in states (the "Bulk Sales States") where Properties are located that have bulk sales acts which would be applicable to the sale of the Properties.   To the extent (i) Sellers receive any statement(s) of taxes described in this clause (f) due with respect to prior to the Closing, Sellers shall promptly cause the Transferred Entities to comply with same and apply the amount due; or (ii) Sellers receive any statement(s) of such taxes due after the Closing, Sellers shall promptly comply with same and apply the amount due, Sellers shall indemnify and hold Purchaser, the Transferred Entities and the JV Entities harmless from and 

	
			
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against, all losses, damages, liabilities, claims and expenses (including, without limitation reasonable attorneys' fees and costs) relating to any tax payment that is owed in a Bulk Sales State with respect to the taxes that would have been the subject of the Bulk Sales States response to the Bulk Sales Filing.  This indemnity shall terminate upon Sellers' obtaining the applicable clearance or waiver from the applicable Bulk Sales State reflecting no taxes due.
40.    AFFECTED PROPERTIES; AFFECTED INDIVIDUAL PROPERTIES.
		
	41.
	MISCELLANEOUS.

(a)    This Agreement may be executed in multiple counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument.  This Agreement may be executed by facsimile or scanned signatures; any signed Agreement or signature page to this Agreement that is transmitted by facsimile or in the portable document format (pdf) shall be treated in all manners and respects as an original Agreement or signature page.
(b)    The Parties acknowledge and agree that, even though the Transferred Interests only include a portion of the Transferred Entities, all calculations to be performed under this Agreement (including, without limitation, prorations and the payment of closing costs) shall be performed on the basis of one hundred percent (100%) of the applicable cost or adjustment.
(c)    Any consent or approval to be given hereunder (whether by any of Seller, Purchaser or Chatham LP) shall not be effective unless the same shall be given in advance of the taking of the action for which consent or approval is requested and shall be in writing.  Except as otherwise expressly provided herein, any consent or approval requested of any Seller, Purchaser or Chatham LP may be withheld by such Seller, Purchaser or Chatham LP in its sole and absolute discretion.
(d)    Escrow Agent is hereby designated the "real estate reporting person" for purposes of Section 6045 of the Code and Treasury Regulation 1.6045-4 and any instructions or settlement statement prepared by Escrow Agent shall so provide. Upon the consummation of the transaction contemplated by this Agreement, Escrow Agent shall file Form 1099 information return and send the statement to Seller as required under the aforementioned statute and regulation. Sellers and Purchaser shall promptly furnish their federal tax identification numbers to Escrow Agent and shall otherwise reasonably cooperate with Escrow Agent in connection with Escrow Agent's duties as real estate reporting person.
(e)    The Parties acknowledge that (x) each Party and its counsel have reviewed this Agreement, (y) each Party has approved this Agreement and (z) the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement (or any amendments, exhibits or schedules hereto) or of any agreements entered into arising from, relating to or in connection with this Agreement.

	
			
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(f)    Each Seller acknowledges that except as set forth in this Agreement, no Seller has any right under this Agreement to close and transfer title to less than all of the Transferred Interests, and in the event any Seller has any right to terminate this Agreement pursuant to a right expressly granted herein, such Seller shall have no right to terminate this Agreement in part (i.e., such right of termination, if exercised, shall be exercised with respect to all Transferred Interests, and not with respect to any Transferred Interest), except as expressly provided herein.  In the event that the Scheduled Closing Date for one or more Properties is/are adjourned for any reason by one or more Sellers or by Purchaser pursuant to any provision of this Agreement, then the Scheduled Closing Date for all of the other Properties shall be automatically adjourned to such adjourned Scheduled Closing Date such that the Scheduled Closing Date applicable to all Properties shall occur simultaneously.  The Sellers hereby: (i) designate Grand Prix Addison (RI) LLC ("GPARI") as having the authority to act on behalf of all of the Sellers in respect of all matters under this Agreement; and (ii) designate GPARI as agent for the service of process in any action or proceeding, whether before a court or by arbitration, involving the determination or enforcement of any rights or obligations under this Agreement.  With regard to the foregoing, (i) any notice, and any summons, complaint or other legal process or notice given in connection with an arbitration proceeding (hereinafter referred to as "legal process"), given to, or served upon, GPARI shall be deemed to have been given to, or served upon, each and every one of the Sellers at the same time that such notice or legal process is given to, or served upon, GPARI, (ii) Purchaser may rely on the authority of GPARI to act on behalf of all Sellers, (iii) the act of GPARI shall be deemed for all purposes to be the act of all Sellers and shall be fully binding upon all  Sellers, (iv) any notice from any Seller other than GPARI purporting to act on behalf of the any of the Sellers shall be void and of no force and effect, and (v) in the event of conflicting notices and/or instructions from any of the Sellers, Purchaser may rely on the act of GPARI.
(g)    With respect to the Individual Properties located in the State of Washington, Purchaser and Sellers agree and acknowledge that such Individual Properties constitute "Commercial Real Estate" as defined in RCW 64.06.005.  Purchaser has been advised of its right to receive a completed seller disclosure statement (the "Seller Disclosure Statement") about the Real Property pursuant to RCW Chapter 64.06.  Purchaser hereby waives (a) the right to receive the Seller Disclosure Statement from Sellers pursuant to RCW Chapter 64.06, and (b) the right to rescind this Agreement based on Purchaser's lack of receipt of such a Seller Disclosure Statement.
(h)    The provisions of this Section 41 shall survive the Closing or the termination hereof.
		
	42.
	TAX MATTERS.

(a)    Indemnification for Pre-Closing Taxes.  Seller and Purchaser acknowledge that the transfer of interests in the Transferee Entities from Seller to Purchaser will result in an actual termination of INK Acquisition IV LLC as a partnership and a "technical termination" of each other Transferred Entity as a partnership under Section 708(b)(1)(B) of the Code and Treasury Regulations section 1.708-1, which will result in the closing of each terminated partnership's taxable year on the Closing Date under Treasury Regulations section 1.708-1(b)(3)(ii).  All tax periods ending on or before the Closing Date are "Pre-Closing Tax Periods".  Sellers 

	
			
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shall indemnify, defend and hold Purchaser, the Transferred Entities and the JV Entities from and against all Taxes of the Transferred Entities and the JV Entities that are due with respect to Pre-Closing Tax Periods., other than Taxes otherwise provided for in this Agreement, including, without limitation, Section 7 (Property Level Taxes) and Section 16 (Transfer Taxes), and other than Taxes arising on the Closing Date but after the Closing.  "Tax" or "Taxes" mean any Property Level Tax and any federal, state, local or foreign income, gross receipts, license, payroll, employment-related, excise, goods and services, harmonized sales, severance, stamp, occupation, premium, windfall profits, environmental, customs duties, capital stock, franchise, profits, withholding, social security, unemployment, disability, transfer, registration, value added, alternative or add-on minimum, estimated, or other tax of any kind whatsoever, including any interest, penalty, or addition thereto, whether disputed or not.  Sellers shall control the contest, at their own expense, with respect to all Taxes indemnified hereunder, including the right to settle or compromise any such Tax liability, provided that Purchaser shall be entitled to participate in any such contest.
(b)    Tax Returns.  Purchaser shall prepare or cause to be prepared all Tax Returns for the Transferred Entities (and, if applicable, the JV Entities) for all Pre-Closing Tax Periods which are filed after the Closing Date, including, without limitation, the final federal income Tax Returns of the "terminated" partnerships, whose tax years will be deemed to end on the Closing Date.  Seller shall review and comment on each such Tax Return at least ten (10) days prior to filing and all such Tax Returns shall reflect Seller's comments, provided, however, that Purchaser shall have sole discretion with respect to any tax elections made on such final federal tax returns, so long as any such elections do not have any impact Seller's tax liability that is not indemnified by Purchaser. Seller shall include any Pre-Closing Tax Period income, gain, loss, deduction or other tax items shown on such Tax Returns on the Seller's income Tax Returns.  Purchaser will be solely responsible for all Tax Returns relating to tax periods after the Closing Date.  "Tax Return" means any return, declaration, report, claim for refund, or information return or statement related to Taxes, including any schedule or attachment thereto, and including any amendment thereof.
43.    INDIVIDUAL OWNERS AND OPERATING LESSEES JOINDER.  Each of the Individual Owners and the Operating Lessees, by their execution hereof, hereby agrees that to the extent Sellers do not have the power to comply with a covenant set forth in Sections 9(a) and (b) above with respect to the Properties and the operation of the Business because only an Individual Owner or Operating Lessee can take such action and Sellers do not have the power to cause such entities to take such action, the applicable Individual Owner or Operating Lessee shall take such action (but the foregoing does not release Sellers from their obligations set forth in Sections 9(a) and 9(b)).  Notwithstanding anything to the contrary, the obligations of the Individual Owners and the Operating Lessees herein may be enforced only by Purchaser and not by any Seller.  For the avoidance of doubt, Purchaser expressly acknowledges and agrees that any failure of the Individual Owners and the Operating Lessees to comply with their obligations under this Section 43 shall not be considered an intentional act of any Seller for the purposes of the last sentence of Section 20(a) above.
[No further text on this page; signature page follows]

	
			
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed the day and year first above written.
SELLERS:
 

 

	
	
	CRE-INK REIT MEMBER, LLC, 
a Delaware limited liability company

	 

	By: /s/ Thomas E. Wagner
   Name:  Thomas E. Wagner
   Title:  Vice President

	
	
	CRE-INK REIT MEMBER IV, LLC, 
a Delaware limited liability company

	 

	By: /s/ Thomas E. Wagner
   Name:  Thomas E. Wagner
   Title:  Vice President

	
	
	CRE-INK REIT MEMBER V, LLC, 
a Delaware limited liability company

	 

	By: /s/ Thomas E. Wagner
   Name:  Thomas E. Wagner
   Title:  Vice President

	
	
	CRE-INK REIT MEMBER VI, LLC, 
a Delaware limited liability company

	 

	By: /s/ Thomas E. Wagner
   Name:  Thomas E. Wagner
   Title:  Vice President

[SIGNATURES CONTINUED ON NEXT PAGE]

	
			
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	CRE-INK REIT MEMBER VII, LLC, 
a Delaware limited liability company

	 

	By: /s/ Thomas E. Wagner
   Name:  Thomas E. Wagner
   Title:  Vice President

    
	
	
	CRE-INK TRS HOLDING, INC., 
a Delaware corporation

	 

	By: /s/ Thomas E. Wagner
   Name:  Thomas E. Wagner
   Title:  Vice President

    

[SIGNATURES CONTINUED ON NEXT PAGE]

	
			
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The undersigned hereby acknowledge and consent to the provisions of Section 43 only.
INDIVIDUAL OWNERS:

GRAND PRIX ADDISON (RI) LLC
GRAND PRIX ADDISON (SS) LLC
GRAND PRIX ALTAMONTE LLC
GRAND PRIX ARLINGTON LLC
GRAND PRIX ATLANTA LLC
GRAND PRIX ATLANTA (PEACHTREE CORNERS) LLC
GRAND PRIX ATLANTIC CITY LLC
GRAND PRIX BELLEVUE LLC
GRAND PRIX BELMONT LLC
GRAND PRIX BINGHAMTON LLC
GRAND PRIX BOTHELL LLC
GRAND PRIX CAMPBELL/SAN JOSE LLC
GRAND PRIX CHERRY HILL LLC
GRAND PRIX CHICAGO LLC
GRAND PRIX COLUMBIA LLC
GRAND PRIX DENVER LLC
GRAND PRIX EL SEGUNDO LLC
GRAND PRIX ENGLEWOOD/DENVER SOUTH LLC
GRAND PRIX FREMONT LLC
GRAND PRIX FT. LAUDERDALE LLC
GRAND PRIX GAITHERSBURG LLC
GRAND PRIX HARRISBURG LLC
GRAND PRIX HORSHAM LLC
GRAND PRIX ISLANDIA LLC
GRAND PRIX LAS COLINAS LLC
GRAND PRIX LEXINGTON LLC
GRAND PRIX LIVONIA LLC
GRAND PRIX LOUISVILLE (RI) LLC
GRAND PRIX LYNNWOOD LLC 
GRAND PRIX MONTVALE LLC 
GRAND PRIX MORRISTOWN LLC 
GRAND PRIX MOUNTAIN VIEW LLC
GRAND PRIX MT. LAUREL LLC
GRAND PRIX NAPLES LLC
GRAND PRIX ONTARIO LLC 
GRAND PRIX PORTLAND LLC
GRAND PRIX RICHMOND LLC
GRAND PRIX RICHMOND (NORTHWEST) LLC
GRAND PRIX ROCKVILLE LLC
GRAND PRIX ROCKVILLE SUBSIDIARY LLC

	
			
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GRAND PRIX SADDLE RIVER LLC,
GRAND PRIX SAN JOSE LLC
GRAND PRIX SAN MATEO LLC
GRAND PRIX SHELTON LLC
GRAND PRIX SILI I LLC
GRAND PRIX SILI II LLC
GRAND PRIX TROY (SE) LLC 
GRAND PRIX TUKWILA LLC
GRAND PRIX WILLOW GROVE LLC
GRAND PRIX WINDSOR LLC
KPA/GP FT. WALTON BEACH LLC
KPA/GP LOUISVILLE (HI) LLC

each a Delaware limited liability company

	
	
	By: /s/ Eric Kentoff
   Name:  Eric Kentoff
   Title:   Authorized Signatory

[SIGNATURES CONTINUED ON NEXT PAGE]

	
			
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	OPERATING LESSEES:

	 

	GRAND PRIX FIXED LESSEE LLC

	a Delaware limited liability company

	 

	By:  /s/ Eric Kentoff

	        Name:  Eric Kentoff

	        Title:     Authorized Signatory

	 

	INK LESSEE LLC,

	a Delaware limited liability company

	 

	By:  /s/ Eric Kentoff

	        Name:  Eric Kentoff

	        Title:     Authorized Signatory

[SIGNATURES CONTINUED ON NEXT PAGE]

	
			
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The undersigned hereby acknowledges and consents to the provisions of Section 2(a) only.
	
	
	Chatham Lodging, L.P., 
a Delaware limited partnership

	 

	By: Chatham Lodging Trust, a Maryland real estate investment trust, its general partner

	 

	By: /s/ Eric Kentoff
   Name:  Eric Kentoff
   Title:     Vice President and Secretary

	
			
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JOINDER

Cerberus Series Four Holdings, LLC, a Delaware limited liability company ("Guarantor"), by Guarantor’s execution of this Joinder (this "Guaranty"), hereby joins in execution of this Agreement to guaranty to Purchaser, the full and timely payment of all of the post-closing monetary obligations of Sellers with respect to the payment and satisfaction of Damages as set forth in Section 11(e) of the Agreement and any other provisions expressly set forth in the Agreement under which any Seller has any express post-closing monetary obligation to Purchaser (collectively, the "Guaranteed Obligations"), subject in all respects to (i) all of the limitations described in the Agreement, including, without limitation, the limitations on survival (i.e., the Limitation Period), and (ii) the Maximum Liability (hereinafter defined).  Notwithstanding any other provisions above or in the Agreement to the contrary, in no event shall the aggregate liability of Guarantor with respect to all of the Guaranteed Obligations exceed, in the aggregate, the sum of Thirty Million and 00/100 Dollars ($30,000,000.00) less any sums paid by Sellers with respect to its post-closing monetary obligations under the Agreement less any sums paid by the Representations Insurance Policy (the "Maximum Liability").  Guarantor is an affiliate of Sellers, and Guarantor is executing this Guaranty to induce Purchaser to enter into the Purchase Agreement.  This is a guaranty of payment and not of collection.  Guarantor waives (i) notice of acceptance; (ii) any requirement that Purchaser commence any litigation against Sellers; or (iii) any and all suretyship defenses (other than the payment of the Guaranteed Obligations).  This Guaranty shall be governed by and construed in accordance with the internal laws of the State of New York, and not the laws pertaining to choice or conflict of laws of the State of New York.  No direct or indirect partner, shareholder, or member in or of Guarantor (and no officer, director, member, employee or agent of such partner, shareholder, or member of Guarantor) will be personally liable for the performance of Guarantor's obligations under this Agreement.  Notwithstanding anything to the contrary contained in this Joinder, the Agreement or in any other document, other than solely with respect to adjustments and prorations as expressly set forth in Section 7(b)(xiv) of this Agreement and Sellers' other post-closing monetary obligations expressly set forth in the Agreement that are not covered by the Representations Insurance Policy, this Joinder shall automatically (and without the necessity of any further instrument) terminate and be void ab initio and of no further force or effect if Purchaser or Sellers obtain a Representations Insurance Policy (as defined in the Agreement).
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	CERBERUS SERIES FOUR HOLDINGS, LLC.

	a Delaware limited liability company

	 

	By:  Cerberus Institutional Partners, L.P. - Series

	         Four, its managing member

	 

	         By:  Cerberus Institutional Associates

	                  L.L.C., its general partner

	 

	                  By:  /s/  Jeffrey L. Lomasky

	                          Name:  Jeffrey L. Lomasky

	                          Title:     Senior Managing Director

	
			
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PURCHASER:

	
				
	NEWINK, LLC, a Delaware limited liability company

	 

	By:
	Chatham NewINK Member, LLC, its Member

	 
	 

	 
	 

	 
	By:
	/s/  Eric Kentoff

	 
	 
	Name:  Eric Kentoff

	 
	 
	Title:  Authorized Signatory

	 
	 

	 

	By:
	Platform Member-T, LLC, its Member

	 
	 

	 
	 

	 
	By:
	/s/  Ronald J. Lieberman

	 
	 
	Name:  Ronald J. Lieberman

	 
	 
	Title:  Executive Vice President, General Counsel and Secretary

	 

    

The undersigned hereby 
acknowledges and consents 
to the provisions of Sections 4(b) and 41(d): 

ESCROW AGENT:
 
FIDELITY NATIONAL TITLE INSURANCE COMPANY, as Escrow Agent 

 

	
	
	By:  /s/ Evie Wexler

	       Name:  Evie Wexler

	       Title:     Title Officer

	
			
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- 2 -

	
			
	DOC ID - 21031260.28
	 
	 

- 3 -

SCHEDULE A

Seller Entities

	
		
	CRE-INK REIT MEMBER, LLC
	CRE-INK REIT MEMBER VI, LLC

	CRE-INK REIT MEMBER IV, LLC
	CRE-INK REIT MEMBER VII, LLC

	CRE-INK REIT MEMBER V, LLC
	CRE-INK TRS HOLDING, INC.

	
			
	DOC ID - 21031260.28
	 
	 

Sched A

SCHEDULE B
[See Attached]
*     *     *     *     *

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Sched B-1

SCHEDULE B-1    
PURCHASE PRICE ALLOCATION

[See attached]

	
			
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Sched B-1-1

*     *     *     *     *

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Sched B-1-1

SCHEDULE B-2
PERCENTAGE INTEREST IN TRANSFERRED ENTITY

INK ACQUISITION LLC                89.7222%
INK ACQUISITION III LLC                89.7222%
INK ACQUISITION IV LLC                89.7222%
INK ACQUISITION V LLC                89.7222%
INK ACQUISITION VI LLC                89.7222%
INK ACQUISITION VII LLC            89.7222%
*     *     *     *     *

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	DOC ID - 21031260.28
	 
	 

Sched B-2-1

SCHEDULE C
List of Franchise Agreements

	
			
	Property

	Franchise Agreement
	Franchisor

	Hampton Inn Louisville Downtown, Louisville, KY
	Amended and Restated Franchise License Agreement dated as of October 27, 2011, by and between Hampton Inns Franchise LLC, as licensor, and Grand Prix Floating Lessee LLC, as licensee.
	Hampton Inns Franchise LLC

	Hyatt House, Addison, TX
	Franchise Agreement dated as of October 27, 2011, by and between Hyatt House Franchising, L.L.C., as franchisor, and Grand Prix Floating Lessee LLC, as franchisee.
	Hyatt House Franchising, L.L.C.

	Residence Inn San Jose, Campbell, CA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn, Fremont, CA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn, Mountain View, CA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn San Jose South, San Jose, CA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn, San Mateo, CA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	
			
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Sched C-1

	
			
	Residence Inn Silicon Valley I, Sunnyvale, CA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn Silicon Valley II, Sunnyvale, CA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn Denver Downtown, Denver, CO
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence inn Denver South Englewood, CO
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn, Shelton, CT
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn, Windsor, CT
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn, Altamonte Springs, FL
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Courtyard, Fort Lauderdale, FL
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn Atlanta Downtown, Atlanta, GA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	
			
	DOC ID - 21031260.28
	 
	 

Sched C-1

	
			
	Residence Inn Peachtree Corners, Atlanta, GA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn Chicago (Rosemont/O'Hare), Rosemont, IL
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn Lexington North, Lexington, KY
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn, Louisville, KY
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn, Gaithersburg, MD
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn Portland, Scarborough, ME
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn, Livonia, MI
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn, Cherry Hill, NJ
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn, Saddle River, NJ
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	
			
	DOC ID - 21031260.28
	 
	 

Sched C-1

	
			
	Residence Inn Binghamton, Vestal, NY
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Towneplace Suites, Horsham, PA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn, Addison, TX
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn, Arlington, TX
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn, Richmond, VA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International Inc. and Grand Prix Fixed Lessee LLC
	Marriott International Inc.

	Residence Inn Richmond NW, Richmond, VA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn, Bellevue, WA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn, Bothell, WA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn, Lynnwood, WA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	
			
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Sched C-1

	
			
	Residence Inn Tukwila, Seattle, WA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Marriott International, Inc.

	Residence Inn Troy Southeast, Madison Heights, MI
	Relicensing Franchise Agreement dated as of October 27, 2011, by and between Marriott International, Inc., as franchisor, and Grand Prix Floating Lessee LLC, as franchisee.
	Marriott International, Inc.

	Courtyard, Atlantic City, NJ
	Relicensing Franchise Agreement dated as of October 27, 2011, by and between Marriott International, Inc., as franchisor, and Grand Prix Floating Lessee LLC, as franchisee.
	Marriott International, Inc.

	Courtyard, Montvale, NJ
	Relicensing Franchise Agreement dated as of October 27, 2011, by and between Marriott International, Inc., as franchisor, and Grand Prix Floating Lessee LLC, as franchisee.
	Marriott International, Inc.

	Residence Inn, Harrisburg, PA
	Relicensing Franchise Agreement dated as of October 27, 2011, by and between Marriott International, Inc., as franchisor, and Grand Prix Floating Lessee LLC, as franchisee.
	Marriott International, Inc.

	Residence Inn, Ontario, CA
	Relicensing Franchise Agreement dated as of October 27, 2011, by and between Marriott International, Inc., as franchisor, and Grand Prix Floating Lessee LLC, as franchisee.
	Marriott International, Inc.

	Hampton Inn, Naples, FL
	Amended and Restated Franchise License Agreement as of October 27, 2011 by and between Hampton Inns Franchise, LLC and Grand Prix Fixed Lessee LLC
	Hampton Inns Franchise LLC

	Hampton Inn, Columbia, MD
	Amended and Restated Franchise License Agreement as of October 27, 2011 by and between Hampton Inns Franchise, LLC and Grand Prix Fixed Lessee LLC
	Hampton Inns Franchise LLC

	
			
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Sched C-1

	
			
	Hampton Inn, Islandia, NY
	Amended and Restated Franchise License Agreement as of October 27, 2011 by and between Hampton Inns Franchise, LLC and Grand Prix Fixed Lessee LLC
	Hampton Inns Franchise LLC

	Hampton Inn, Willow Grove, PA
	Amended and Restated Franchise License Agreement as of October 27, 2011 by and between Hampton Inns Franchise, LLC and Grand Prix Fixed Lessee LLC
	Hampton Inns Franchise LLC

	Sheraton Four Points, Fort Walton Beach, FL
	License Agreement dated as of October 26, 2011, as amended and assigned, by and between The Sheraton LLC, as licensor, and INK Lessee LLC, as licensee.
	The Sheraton LLC

	Sheraton, Rockville, MD
	License Agreement dated as of October 27, 2011, as amended and assigned, by and between The Sheraton LLC, as licensor, and Grand Prix Floating Lessee LLC, as licensee.
	The Sheraton LLC

	Hyatt House, Belmont, CA
	Franchise Agreement as of October 27, 2011 by and between Hyatt House Franchising, L.L.C. and Grand Prix Fixed Lessee LLC
	Hyatt House Franchising, L.L.C.

	Hyatt House, El Segundo, CA
	Franchise Agreement as of October 27, 2011 by and between Hyatt House Franchising, L.L.C. and Grand Prix Fixed Lessee LLC
	Hyatt House Franchising, L.L.C.

	Hyatt House, Mount Laurel, NJ
	Franchise Agreement as of October 27, 2011 by and between Hyatt House Franchising, L.L.C. and Grand Prix Fixed Lessee LLC
	Hyatt House Franchising, L.L.C.

	Hyatt House, 
Las Colinas, Irving, TX
	Franchise Agreement as of October 27, 2011 by and between Hyatt House Franchising, L.L.C. and Grand Prix Fixed Lessee LLC
	Hyatt House Franchising, L.L.C.

	Westin Inn, Morristown, NJ
	License Agreement dated as of October 26, 2011, as amended and assigned, by and between Westin Hotel Management, L.P., as licensor, and INK Lessee LLC, as licensee.
	Westin Hotel Management, L.P.

*     *     *     *     *

	
			
	DOC ID - 21031260.28
	 
	 

Sched C-1

SCHEDULE C-1
List of Franchise Agreement Defaults
	
			
	Property

	Franchise Agreement
	Brief Description

	Residence Inn Troy Southeast, Madison Heights, MI
	Relicensing Franchise Agreement dated as of October 27, 2011, by and between Marriott International, Inc., as franchisor, and Grand Prix Floating Lessee LLC, as franchisee.
	Notice of Red Zone 2/Default from Franchisor, dated February 28, 2014.
Hotel failed Marriott's Quality Assurance Program ("QA Program").

Potential Defaults
	
			
	Property

	Franchise Agreement
	Brief Description

	Courtyard, Fort Lauderdale, FL
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Hotel failed QA Program, but Franchisee has not received formal Notice Letter.

	Towneplace Suites, Horsham, PA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International Inc. and Grand Prix Fixed Lessee LLC
	Notice of Red Zone 1 Status from Franchisor, dated February 22, 2013.
Hotel failed QA Program and is in Red Zone 1.

	Residence Inn, Shelton, CT
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Hotel failed QA Program and is in Red Zone 1.

	Residence Inn, Altamonte Springs, FL
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Notice of Red Zone 1 Status from Franchisor, dated August 30, 2013.
Hotel failed QA Program and is in Red Zone 1.

	Residence Inn, Mountain View, CA
	Relicensing Franchise Agreement as of October 27, 2011 by and between Marriott International, Inc. and Grand Prix Fixed Lessee LLC
	Notice of Red Zone 1 Status from Franchisor, dated February 28, 2014.
Hotel failed QA Program and is in Red Zone 1.

	
			
	DOC ID - 21031260.28
	 
	 

Sched C-1

	
			
	Courtyard, Montvale, NJ
	Relicensing Franchise Agreement dated as of October 27, 2011, by and between Marriott International, Inc., as franchisor, and Grand Prix Floating Lessee LLC, as franchisee.
	Hotel failed QA Program, but Franchisee has not received formal Notice Letter.

	Sheraton, Rockville, MD
	License Agreement dated as of October 27, 2011, as amended and assigned, by and between The Sheraton LLC, as licensor, and Grand Prix Floating Lessee LLC, as licensee.
	Resolution of May 14, 2013 Notice of Default Letter.
Hotel was under construction at the time of Letter and resolved the issues, but is awaiting approval from Franchisor. 

	Hyatt House, Mount Laurel, NJ
	Franchise Agreement as of October 27, 2011 by and between Hyatt House Franchising, L.L.C. and Grand Prix Fixed Lessee LLC
	Deficiency Improvement Notice Letter from Franchisor, dated September 13, 2013.
Hotel is in the Deficiency Improvement Policy ("DIP"). 

	Hyatt House, El Segundo, CA
	Franchise Agreement as of October 27, 2011 by and between Hyatt House Franchising, L.L.C. and Grand Prix Fixed Lessee LLC
	Hotel is potentially in the DIP, but Franchisee has not received formal Notice Letter.

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	DOC ID - 21031260.28
	 
	 

Sched C-1

SCHEDULE D
List of Leases

		
	1.
	License Agreement, dated February 3, 2001, between INK Lessee, LLC, successor-in-interest to ACQI Associates, L.P., as licensor, and AT&T Mobility, successor-in-interest to Amcell of Atlantic City, LLC, as licensee, concerning premises located at 1212 Pacific Avenue, Atlantic City, NJ 08401.

		
	2.
	Lease Agreement, dated March 1, 2011, between INK Lessee, LLC, successor-in-interest to Grand Prix Floating Lessee LLC, as landlord, and Commodore Parking Service, LLC, as tenant, concerning premises located at 1212 Pacific Avenue, Atlantic City, NJ 08401.

		
	3.
	Lease Agreement, dated August 30, 2007, between INK Lessee, LLC, successor-in-interest to Grand Prix Floating Lessee LLC, as landlord, and South City Prime Montvale, LLC, as tenant, concerning premises located at 100 Chestnut Ridge Road, Montvale, New Jersey 07645.

		
	4.
	(I) Retail Area Lease Agreement, dated as of October 16, 1995, by and between Grand Prix Fixed Lessee, LLC (successor-in-interest to Atlanta Lodging Associates I, Limited Partnership), as landlord, and R-H Group, L.L.C., as tenant; (II) Annex Lease Agreement, dated as of October 16, 1995, by and between Grand Prix Fixed Lessee, LLC (successor-in-interest to Atlanta Lodging Associates I, Limited Partnership), as landlord, and R-H Group, L.L.C., as tenant; and (III) Penthouse Lease Agreement, dated as of October 16, 1995, by and between Grand Prix Fixed Lessee, LLC (successor-in-interest to Atlanta Lodging Associates I, Limited Partnership), as landlord, and R-H Group, L.L.C., as tenant; each concerning premises located at 134 Peachtree Street NW, Atlanta, Georgia 30303.

		
	5.
	Agreement, dated November 1, 2011, between Island Hospitality Management Inc., as agent for INK Acquisition III, LLC, and Universal Vending Management, LLC, concerning each of the Properties (as defined in the Purchase and Sale Agreement to which this Schedule D is attached).

		
	6.
	Standard Office Lease, dated April 8, 2014, between INK Acquisition III, LLC, a Delaware limited liability company, as Tenant, and Lake Midas LLC, a California limited liability company, as Landlord, concerning premises located at 530 Lakeside Drive, Sunnyvale, California.

*     *     *     *     *

	
			
	DOC ID - 21031260.28
	 
	 

Sched D-1

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Sched D-2

SCHEDULE D-1

List of Prepaid Rent

None.

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	DOC ID - 21031260.28
	 
	 

Sched D-1-1

SCHEDULE E
Section 2(a)(2) Definitions

The "Grossed-Up Purchase Price" shall mean amount equal to $1,260,300,000.00. 

The "Grossed-Up Specified Hotel Purchase Price" shall mean an amount equal to $326,450,000.00

"Net Cash Flow" has the meaning forth in the Second Amended and Restated Limited Liability Agreement of INK Acquisition LLC, dated as of October 27, 2011, made by and between CRE-Ink REIT Member LLC and Chatham LP and the Second Amended and Restated Limited Liability Agreement of INK Acquisition III LLC, dated as of October 27, 2011, made by and between CRE-Ink TRS Holding, Inc. and Chatham TRS Holding, Inc. 

The "Chatham Post-Distribution Liquidating Distribution" equals 10.2778% of the Net Cash Flow that would be distributed to the members of the Final Transferred Entities if they were liquidated following the distribution of the Specified Hotel Interests and a sale of all of the remaining assets of the Final Transferred Entities for cash in an amount equal to the excess of the Grossed-Up Purchase Price over the Grossed-Up Specified Hotel Purchase Price.

The "Chatham Pre-Distribution Liquidating Distribution" equals Net Cash Flow that would be distributed by the Final Transferred Entities to Chatham Lodging LP if they were liquidated following the Merger and the sale of all of their assets for cash in an amount equal to the Grossed-Up Purchase Price.

The "Chatham Aggregate Deemed Distribution Amount" equals the excess of the Chatham Pre-Distribution Liquidating Distribution over the Chatham Post-Distribution Liquidating Distribution.

The "Specified Hotel Net Value" equals the fair market value of the Specified Hotels immediately prior to the Mergers less the debt attributable to the Specified Hotels.

The "Specified Hotel Transaction Consideration" equals the excess of the Specified Hotels Net Value over Chatham Aggregate Deemed Distribution Amount.

The "Deemed Pro-Rata Distribution Amount" equals the Specified Hotel Consideration divided by Sellers' Sharing Percentage.

The "Chatham Deemed Pro-Rata Distribution Amount" equals the product of the Deemed Pro-Rata Distribution Amount and Chatham's Sharing Percentage.

	
			
	DOC ID - 21031260.28
	 
	 

Sched E-1

The "Deemed Disproportionate Distribution Amount" equals the excess of the Chatham Aggregated Deemed Distribution Amount over the Chatham Deemed Pro-Rata Distribution Amount.

*     *     *     *     *

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	DOC ID - 21031260.28
	 
	 

Sched E-1

SCHEDULE F
Pending Condemnation Proceedings
None.

*     *     *     *     *

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Sched F-1

SCHEDULE G
List of Litigation

General Litigation
	
		
	Case Caption
	Docket Number

	SHEA SHAW V. ISLAND HOSPITALITY MANAGEMENT, INC., ET AL.
	 

	MAISONNEUVE PATRICE VS ISLAND HOSPITALITY MANAGEMENT,
	NJ2011285256

	GARCIA MARIA VS ISLAND HOSPITALITY MANAGEMENT,
	ADJ8768795

	HERNANDEZ VS. ISLAND HOSPITALITY MANAGEMENT
	 

	ELODIA PARRAS VS. ISLAND HOSPITALITY MANAGEMENT
	 

	VALENZUELA GILBERTO VS INNKEEPERS HOSPITALITY MANAGEM
	NJ2011166745

	SANCHEZ GLADYS VS ISLAND HOSPITALITY MANAGEMENT,
	NJ2013082520

	CORTES v. AMANCHA
	 

	ROSEMARY BARRIOS V. INNKEEPERS HOSPITALITY
	ADJ8728578

	ORNELAS MEDINA MARIA LIVIER VS ISLAND HOSPITALITY MANAGEMENT
	ADJ8254923

	SANTOS MARIA V. INNKEEPERS HOSPITALITY MANAGEM
	2008-671

	WESCOTT ANGELINA VS INNKEEPERS HOSPITALITY MANAGEM
	NJ2011197678

	HARRIGAN V. ISLAND HOSPITALITY MANAGEMENT, INC.
	1071331

	
			
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Sched G-1

	
		
	SAPIENTE V. RESIDENCE INN BY MARRIOTT, LLC., ET AL
	CV13 6012312

	GUZMAN MATILDE VS ISLAND HOSPITALITY MANAGEMENT,
	ADJ8370589

	WILLIAMS, REGINALD ET AL V. INK ACQUISITION, LLC, ET AL
	 

	OSMIN VASQUEZ VS ISLAND HOSPITALITY MANAGEMENT,
	B771773

	GARCIA VS. LAMM, INNKEEPERS HOSPITALITY, INNKEEPERS USA, ET
	03915/10

	LYNCH EDWARD VS ISLAND HOSPITALITY MANAGEMENT,
	NJ2012343338

	TIBURCIO LUISA VS INNKEEPERS HOSPITALITY MANAGEM
	709-942713

	MICHAEL CLAUDIUS V. GRAND PRIX WILLOW GROVE LLC
	 

	VISSANDIER JOSIANA VS ISLAND HOSPITALITY MANAGEMENT,
	3440428

	DOKO BUJAR VS INNKEEPERS HOSPITALITY MANAGEM
	 

	THOMAS O'LEARY VS GRAND PRIX LOUISVILLE LLC ISLAND HOSPITALI
	 

	JANE DOE VS ISLAND HOSPITALITY MANAGEMENT
	 

	SANCHEZ ANTONIETA VS INNKEEPERS HOSPITALITY MANAGEM
	ADJ8210911

	MARTINEZ MARJO VS ISLAND HOSPITALITY MANAGEMENT
	 

	RIPOSO
	002319-000907-GB-01

 
[CONTINUED ON FOLLOWING PAGE]

	
			
	DOC ID - 21031260.28
	 
	 

Sched G-2

Open Employment Legal Matters
	
		
	Party Name
	Issue

	Dilma Coleman
	Discrimination

	Cassandra Collins
	Discrimination

	Michele Halpin
	Discrimination

	Briel Banks
	Discrimination

	Martinez/Rodriguez/Mercado
	Wage & Hour

	Christine Barbin
	Discrimination

	Yuron Villanueva
	Wrongful Termination

	Berquy Bailote
	Discrimination

	CBA Local 6
	New CBA

	Timothy Fennell
	Wrongful Termination

	Timothy Fennell
	Wage & Hour

	Irma Silva
	Lost Time

	Maria Cortes
	Lost Time

	Elodia Parras
	Lost Time

	Antonio Gonzalez
	Lost Time

	
			
	DOC ID - 21031260.28
	 
	 

Sched G-3

	
		
	Claudia Medina
	Lost Time

	Evelyn Dement
	Lost Time

	Alba Hernandez Anguiano
	Lost Time

	Graciela Galvez
	Lost Time

	Gloria Quezada
	Lost Time

	Berquy Bailote
	Lost Time

	Maria Magda Alvarez
	Lost Time

	Maria Martinez
	Lost Time

	Gisela Amayo
	Lost Time

[CONTINUED ON NEXT PAGE]

Other Litigation

	
			
	DOC ID - 21031260.28
	 
	 

Sched G-4

	
		
	Claimant Name
	Claim Number

	JARED ROSSI
	L001037967-1-10-00

	ALICE HANIFY
	L001158797-1-30-00

	SHIU HUEI YEN
	L000818004-1-10-12

	TERRANCE JAMES
	L001024886-1-30-00

	ROSVELLANN DIONES-GARNER
	L001024886-2-30-00

	ANDREW RAPOZA
	L000949836-1-30-00

Pending or Threatened Litigation
	
		
	FIRE AND OAK (MONTVALE COURTYARD)
	Dispute related to payments with respect to good and services.

	
			
	DOC ID - 21031260.28
	 
	 

Sched G-5

SCHEDULE H-1
Mezz A Borrowers

1.    GRAND PRIX MEZZ BORROWER FIXED A LLC
2.    INK MEZZ BORROWER A LLC
3.    INK IV MEZZ BORROWER A LLC
4.    INK V MEZZ BORROWER A LLC
5.    INK V MEZZ BORROWER 2A LLC
6.    INK VI MEZZ BORROWER A LLC
7.    INK VI MEZZ BORROWER 2A LLC
8.    INK VII MEZZ BORROWER A LLC
9.    INK VII MEZZ BORROWER 2A LLC

*     *     *     *     *

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Sched H-1-1

SCHEDULE H-2
Mezz B Borrowers

1.    GRAND PRIX MEZZ BORROWER FIXED B LLC
2.    INK MEZZ BORROWER B LLC
3.    INK IV MEZZ BORROWER B LLC
4.    INK V MEZZ BORROWER B LLC
5.    INK V MEZZ BORROWER 2B LLC
6.    INK VI MEZZ BORROWER B LLC
7.    INK VI MEZZ BORROWER 2B LLC
8.    INK VII MEZZ BORROWER B LLC
9.    INK VII MEZZ BORROWER 2B LLC

*     *     *     *     *

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	DOC ID - 21031260.28
	 
	 

Sched H-2-1

SCHEDULE H-3
Mezz C Borrowers

1.    GRAND PRIX MEZZ BORROWER FIXED LLC
2.    INK MEZZ BORROWER LLC
3.    INK IV MEZZ BORROWER LLC
4.    INK V MEZZ BORROWER LLC
5.    INK V MEZZ BORROWER 2C LLC
6.    INK VI MEZZ BORROWER LLC
7.    INK VI MEZZ BORROWER 2C LLC
8.    INK VII MEZZ BORROWER LLC
9.    INK VII MEZZ BORROWER 2C LLC

*     *     *     *     *

[No further text on this page.]

	
			
	DOC ID - 21031260.28
	 
	 

Sched H-3-1

SCHEDULE I
Current Structure Chart

	
			
	DOC ID - 21031260.28
	 
	 

Sched I-1

	
			
	DOC ID - 21031260.28
	 
	 

Sched I-2

	
			
	DOC ID - 21031260.28
	 
	 

Sched I-3

	
	
	Exhibit A

	Grand Prix Belmont LLC

	Grand Prix Campbell/San Jose LLC

	Grand Prix Fremont LLC

	Grand Prix Mountain View LLC

	Grand Prix San Jose LLC

	Grand Prix San Mateo LLC

	Grand Prix Ft. Lauderdale LLC

	Grand Prix Naples LLC

	Grand Prix Atlanta (Peachtree Corners) LLC

	Grand Prix Atlanta LLC

	Grand Prix Chicago LLC

	Grand Prix Columbia LLC

	Grand Prix Gaithersburg LLC

	Grand Prix Portland LLC

	Grand Prix Livonia LLC

	Grand Prix Islandia LLC

	Grand Prix Horsham LLC

	Grand Prix Willow Grove LLC

	Grand Prix Addison (RI) LLC

	Grand Prix Arlington LLC

	Grand Prix Las Colinas LLC

	Grand Prix Richmond (Northwest) LLC

	Grand Prix Bellevue LLC

	Grand Prix Bothell LLC

	Grand Prix Lynnwood LLC

	Grand Prix Tukwila LLC

	
			
	DOC ID - 21031260.28
	 
	 

Sched I-4

SCHEDULE J
Purchase Price
[See attached]

	
			
	DOC ID - 21031260.28
	 
	 

Sched J-1

	
													
	INK CLOSING DISTRIBUTIONS - CLOSING DATE SENSITIVITES

	 
	 
	 
	 
	 
	 
	 

	 
	 
	Closing Distributions

	Closing
	 
	Equity Purchase
	 
	Debt
	 
	Purchase

	Date
	 
	Price
	 
	Repayment
	 
	Price

	 
	 
	 
	 
	 
	 
	 

	5/16/2014
	 
	$
	280,687,583.58
	

	 
	$
	900,000,000.00
	

	 
	$
	1,180,687,583.58
	

	5/17/2014
	 
	280,698,654.24
	

	 
	900,000,000.00
	

	 
	1,180,698,654.24
	

	5/18/2014
	 
	280,709,730.65
	

	 
	900,000,000.00
	

	 
	1,180,709,730.65
	

	5/19/2014
	 
	280,720,812.83
	

	 
	900,000,000.00
	

	 
	1,180,720,812.83
	

	5/20/2014
	 
	280,731,900.78
	

	 
	900,000,000.00
	

	 
	1,180,731,900.78
	

	5/21/2014
	 
	280,742,994.50
	

	 
	900,000,000.00
	

	 
	1,180,742,994.50
	

	5/22/2014
	 
	280,754,094.00
	

	 
	900,000,000.00
	

	 
	1,180,754,094.00
	

	5/23/2014
	 
	280,765,199.28
	

	 
	900,000,000.00
	

	 
	1,180,765,199.28
	

	5/24/2014
	 
	280,776,310.33
	

	 
	900,000,000.00
	

	 
	1,180,776,310.33
	

	5/25/2014
	 
	280,787,427.18
	

	 
	900,000,000.00
	

	 
	1,180,787,427.18
	

	5/26/2014
	 
	280,798,549.81
	

	 
	900,000,000.00
	

	 
	1,180,798,549.81
	

	5/27/2014
	 
	280,809,678.23
	

	 
	900,000,000.00
	

	 
	1,180,809,678.23
	

	5/28/2014
	 
	280,820,812.44
	

	 
	900,000,000.00
	

	 
	1,180,820,812.44
	

	5/29/2014
	 
	280,831,952.45
	

	 
	900,000,000.00
	

	 
	1,180,831,952.45
	

	5/30/2014
	 
	280,843,098.27
	

	 
	900,000,000.00
	

	 
	1,180,843,098.27
	

	5/31/2014
	 
	280,854,249.88
	

	 
	900,000,000.00
	

	 
	1,180,854,249.88
	

	6/1/2014
	 
	280,865,407.30
	

	 
	900,000,000.00
	

	 
	1,180,865,407.30
	

	6/2/2014
	 
	280,876,570.54
	

	 
	900,000,000.00
	

	 
	1,180,876,570.54
	

	6/3/2014
	 
	280,887,739.58
	

	 
	900,000,000.00
	

	 
	1,180,887,739.58
	

	6/4/2014
	 
	280,898,914.44
	

	 
	900,000,000.00
	

	 
	1,180,898,914.44
	

	6/5/2014
	 
	280,910,095.12
	

	 
	900,000,000.00
	

	 
	1,180,910,095.12
	

	6/6/2014
	 
	280,921,281.62
	

	 
	900,000,000.00
	

	 
	1,180,921,281.62
	

	6/7/2014
	 
	280,932,473.95
	

	 
	900,000,000.00
	

	 
	1,180,932,473.95
	

	6/8/2014
	 
	280,943,672.10
	

	 
	900,000,000.00
	

	 
	1,180,943,672.10
	

	6/9/2014
	 
	280,954,876.09
	

	 
	900,000,000.00
	

	 
	1,180,954,876.09
	

	6/10/2014
	 
	280,966,085.91
	

	 
	900,000,000.00
	

	 
	1,180,966,085.91
	

	6/11/2014
	 
	280,977,301.57
	

	 
	900,000,000.00
	

	 
	1,180,977,301.57
	

	6/12/2014
	 
	280,988,523.07
	

	 
	900,000,000.00
	

	 
	1,180,988,523.07
	

	6/13/2014
	 
	280,999,750.42
	

	 
	900,000,000.00
	

	 
	1,180,999,750.42
	

	6/14/2014
	 
	281,010,983.61
	

	 
	900,000,000.00
	

	 
	1,181,010,983.61
	

	6/15/2014
	 
	281,022,222.65
	

	 
	900,000,000.00
	

	 
	1,181,022,222.65
	

	6/16/2014
	 
	281,033,467.55
	

	 
	900,000,000.00
	

	 
	1,181,033,467.55
	

	6/17/2014
	 
	281,044,718.30
	

	 
	900,000,000.00
	

	 
	1,181,044,718.30
	

	6/18/2014
	 
	281,055,974.91
	

	 
	900,000,000.00
	

	 
	1,181,055,974.91
	

	6/19/2014
	 
	281,067,237.39
	

	 
	900,000,000.00
	

	 
	1,181,067,237.39
	

	6/20/2014
	 
	281,078,505.73
	

	 
	900,000,000.00
	

	 
	1,181,078,505.73
	

	
			
	DOC ID - 21031260.28
	 
	 

Sched J-1

	
													
	6/21/2014
	 
	281,089,779.94
	

	 
	900,000,000.00
	

	 
	1,181,089,779.94
	

	6/22/2014
	 
	281,101,060.02
	

	 
	900,000,000.00
	

	 
	1,181,101,060.02
	

	6/23/2014
	 
	281,112,345.98
	

	 
	900,000,000.00
	

	 
	1,181,112,345.98
	

	6/24/2014
	 
	281,123,637.82
	

	 
	900,000,000.00
	

	 
	1,181,123,637.82
	

	6/25/2014
	 
	281,134,935.54
	

	 
	900,000,000.00
	

	 
	1,181,134,935.54
	

	6/26/2014
	 
	281,146,239.14
	

	 
	900,000,000.00
	

	 
	1,181,146,239.14
	

	6/27/2014
	 
	281,157,548.64
	

	 
	900,000,000.00
	

	 
	1,181,157,548.64
	

	6/28/2014
	 
	281,168,864.02
	

	 
	900,000,000.00
	

	 
	1,181,168,864.02
	

	6/29/2014
	 
	281,180,185.30
	

	 
	900,000,000.00
	

	 
	1,181,180,185.30
	

	6/30/2014
	 
	281,191,512.48
	

	 
	900,000,000.00
	

	 
	1,181,191,512.48
	

	7/1/2014
	 
	281,202,845.55
	

	 
	900,000,000.00
	

	 
	1,181,202,845.55
	

	7/2/2014
	 
	281,214,184.54
	

	 
	900,000,000.00
	

	 
	1,181,214,184.54
	

	7/3/2014
	 
	281,225,529.42
	

	 
	900,000,000.00
	

	 
	1,181,225,529.42
	

	7/4/2014
	 
	281,236,880.22
	

	 
	900,000,000.00
	

	 
	1,181,236,880.22
	

	7/5/2014
	 
	281,248,236.94
	

	 
	900,000,000.00
	

	 
	1,181,248,236.94
	

	7/6/2014
	 
	281,259,599.57
	

	 
	900,000,000.00
	

	 
	1,181,259,599.57
	

	7/7/2014
	 
	281,270,968.12
	

	 
	900,000,000.00
	

	 
	1,181,270,968.12
	

	7/8/2014
	 
	281,282,342.59
	

	 
	900,000,000.00
	

	 
	1,181,282,342.59
	

	7/9/2014
	 
	281,293,722.99
	

	 
	900,000,000.00
	

	 
	1,181,293,722.99
	

	7/10/2014
	 
	281,305,109.32
	

	 
	900,000,000.00
	

	 
	1,181,305,109.32
	

	7/11/2014
	 
	281,316,501.59
	

	 
	900,000,000.00
	

	 
	1,181,316,501.59
	

	7/12/2014
	 
	281,327,899.78
	

	 
	900,000,000.00
	

	 
	1,181,327,899.78
	

	7/13/2014
	 
	281,339,303.92
	

	 
	900,000,000.00
	

	 
	1,181,339,303.92
	

	7/14/2014
	 
	281,350,714.00
	

	 
	900,000,000.00
	

	 
	1,181,350,714.00
	

	7/15/2014
	 
	281,362,130.03
	

	 
	900,000,000.00
	

	 
	1,181,362,130.03
	

	7/16/2014
	 
	281,373,552.00
	

	 
	900,000,000.00
	

	 
	1,181,373,552.00
	

	7/17/2014
	 
	281,384,979.93
	

	 
	900,000,000.00
	

	 
	1,181,384,979.93
	

	7/18/2014
	 
	281,396,413.81
	

	 
	900,000,000.00
	

	 
	1,181,396,413.81
	

	7/19/2014
	 
	281,407,853.65
	

	 
	900,000,000.00
	

	 
	1,181,407,853.65
	

	7/20/2014
	 
	281,419,299.45
	

	 
	900,000,000.00
	

	 
	1,181,419,299.45
	

	7/21/2014
	 
	281,430,751.22
	

	 
	900,000,000.00
	

	 
	1,181,430,751.22
	

	7/22/2014
	 
	281,442,208.95
	

	 
	900,000,000.00
	

	 
	1,181,442,208.95
	

	7/23/2014
	 
	281,453,672.66
	

	 
	900,000,000.00
	

	 
	1,181,453,672.66
	

	7/24/2014
	 
	281,465,142.34
	

	 
	900,000,000.00
	

	 
	1,181,465,142.34
	

	7/25/2014
	 
	281,476,618.00
	

	 
	900,000,000.00
	

	 
	1,181,476,618.00
	

	7/26/2014
	 
	281,488,099.64
	

	 
	900,000,000.00
	

	 
	1,181,488,099.64
	

	7/27/2014
	 
	281,499,587.26
	

	 
	900,000,000.00
	

	 
	1,181,499,587.26
	

	7/28/2014
	 
	281,511,080.87
	

	 
	900,000,000.00
	

	 
	1,181,511,080.87
	

	7/29/2014
	 
	281,522,580.47
	

	 
	900,000,000.00
	

	 
	1,181,522,580.47
	

	7/30/2014
	 
	281,534,086.07
	

	 
	900,000,000.00
	

	 
	1,181,534,086.07
	

	7/31/2014
	 
	281,545,597.66
	

	 
	900,000,000.00
	

	 
	1,181,545,597.66
	

	8/1/2014
	 
	281,557,115.25
	

	 
	900,000,000.00
	

	 
	1,181,557,115.25
	

	
			
	DOC ID - 21031260.28
	 
	 

Sched J-2

	
													
	8/2/2014
	 
	281,568,638.85
	

	 
	900,000,000.00
	

	 
	1,181,568,638.85
	

	8/3/2014
	 
	281,580,168.45
	

	 
	900,000,000.00
	

	 
	1,181,580,168.45
	

	8/4/2014
	 
	281,591,704.06
	

	 
	900,000,000.00
	

	 
	1,181,591,704.06
	

	8/5/2014
	 
	281,603,245.69
	

	 
	900,000,000.00
	

	 
	1,181,603,245.69
	

	8/6/2014
	 
	281,614,793.33
	

	 
	900,000,000.00
	

	 
	1,181,614,793.33
	

	8/7/2014
	 
	281,626,346.99
	

	 
	900,000,000.00
	

	 
	1,181,626,346.99
	

	8/8/2014
	 
	281,637,906.68
	

	 
	900,000,000.00
	

	 
	1,181,637,906.68
	

	8/9/2014
	 
	281,649,472.39
	

	 
	900,000,000.00
	

	 
	1,181,649,472.39
	

	8/10/2014
	 
	281,661,044.13
	

	 
	900,000,000.00
	

	 
	1,181,661,044.13
	

	8/11/2014
	 
	281,672,621.90
	

	 
	900,000,000.00
	

	 
	1,181,672,621.90
	

	8/12/2014
	 
	281,684,205.71
	

	 
	900,000,000.00
	

	 
	1,181,684,205.71
	

	8/13/2014
	 
	281,695,795.56
	

	 
	900,000,000.00
	

	 
	1,181,695,795.56
	

	8/14/2014
	 
	281,707,391.45
	

	 
	900,000,000.00
	

	 
	1,181,707,391.45
	

	8/15/2014
	 
	281,718,993.38
	

	 
	900,000,000.00
	

	 
	1,181,718,993.38
	

	8/16/2014
	 
	281,730,601.37
	

	 
	900,000,000.00
	

	 
	1,181,730,601.37
	

	8/17/2014
	 
	281,742,215.41
	

	 
	900,000,000.00
	

	 
	1,181,742,215.41
	

	8/18/2014
	 
	281,753,835.50
	

	 
	900,000,000.00
	

	 
	1,181,753,835.50
	

	8/19/2014
	 
	281,765,461.65
	

	 
	900,000,000.00
	

	 
	1,181,765,461.65
	

	8/20/2014
	 
	281,777,093.86
	

	 
	900,000,000.00
	

	 
	1,181,777,093.86
	

	8/21/2014
	 
	281,788,732.14
	

	 
	900,000,000.00
	

	 
	1,181,788,732.14
	

	8/22/2014
	 
	281,800,376.49
	

	 
	900,000,000.00
	

	 
	1,181,800,376.49
	

	8/23/2014
	 
	281,812,026.91
	

	 
	900,000,000.00
	

	 
	1,181,812,026.91
	

	8/24/2014
	 
	281,823,683.40
	

	 
	900,000,000.00
	

	 
	1,181,823,683.40
	

	8/25/2014
	 
	281,835,345.97
	

	 
	900,000,000.00
	

	 
	1,181,835,345.97
	

	8/26/2014
	 
	281,847,014.63
	

	 
	900,000,000.00
	

	 
	1,181,847,014.63
	

	8/27/2014
	 
	281,858,689.37
	

	 
	900,000,000.00
	

	 
	1,181,858,689.37
	

	8/28/2014
	 
	281,870,370.19
	

	 
	900,000,000.00
	

	 
	1,181,870,370.19
	

	8/29/2014
	 
	281,882,057.11
	

	 
	900,000,000.00
	

	 
	1,181,882,057.11
	

	8/30/2014
	 
	281,893,750.12
	

	 
	900,000,000.00
	

	 
	1,181,893,750.12
	

	8/31/2014
	 
	281,905,449.23
	

	 
	900,000,000.00
	

	 
	1,181,905,449.23
	

	9/1/2014
	 
	281,917,154.44
	

	 
	900,000,000.00
	

	 
	1,181,917,154.44
	

	9/2/2014
	 
	281,928,865.76
	

	 
	900,000,000.00
	

	 
	1,181,928,865.76
	

	9/3/2014
	 
	281,940,583.19
	

	 
	900,000,000.00
	

	 
	1,181,940,583.19
	

	9/4/2014
	 
	281,952,306.72
	

	 
	900,000,000.00
	

	 
	1,181,952,306.72
	

	9/5/2014
	 
	281,964,036.37
	

	 
	900,000,000.00
	

	 
	1,181,964,036.37
	

	9/6/2014
	 
	281,975,772.14
	

	 
	900,000,000.00
	

	 
	1,181,975,772.14
	

	9/7/2014
	 
	281,987,514.03
	

	 
	900,000,000.00
	

	 
	1,181,987,514.03
	

	9/8/2014
	 
	281,999,262.04
	

	 
	900,000,000.00
	

	 
	1,181,999,262.04
	

	9/9/2014
	 
	282,011,016.18
	

	 
	900,000,000.00
	

	 
	1,182,011,016.18
	

	9/10/2014
	 
	282,022,776.45
	

	 
	900,000,000.00
	

	 
	1,182,022,776.45
	

	9/11/2014
	 
	282,034,542.86
	

	 
	900,000,000.00
	

	 
	1,182,034,542.86
	

	9/12/2014
	 
	282,046,315.40
	

	 
	900,000,000.00
	

	 
	1,182,046,315.40
	

	
			
	DOC ID - 21031260.28
	 
	 

Sched J-3

	
													
	9/13/2014
	 
	282,058,094.08
	

	 
	900,000,000.00
	

	 
	1,182,058,094.08
	

	9/14/2014
	 
	282,069,878.91
	

	 
	900,000,000.00
	

	 
	1,182,069,878.91
	

	9/15/2014
	 
	282,081,669.89
	

	 
	900,000,000.00
	

	 
	1,182,081,669.89
	

	
			
	DOC ID - 21031260.28
	 
	 

Sched J-4

SCHEDULE K
Insurance Certificates

1. Certificate of Liability Insurance, dated April, 24, 2014, Policy No. 301375-043877
(Agency: Arthur J. Gallagher Risk Management Services, Inc.; Insured: Island Hospitality Management, Inc.), effective December 31, 2013.

2. Certificate of Commercial Property Insurance, dated December 2, 2013, Certificate No: 57005208434 (Agency: Aon Risk Services Northeast, Inc.; Insured: INK Acquisition, LLC), effective December 1, 2013.
*     *     *     *     *

[No further text on this page.]

	
			
	DOC ID - 21031260.28
	 
	 

Sched K-1

SCHEDULE L
Financials

[See Attached]

*     *     *     *     *

[No further text on this page.]

	
			
	DOC ID - 21031260.28
	 
	 

Sched L-1

SCHEDULE M
Judgments
None.

*     *     *     *     *

[No further text on this page.]

	
			
	DOC ID - 21031260.28
	 
	 

Sched M-1

SCHEDULE N
Operating Leases

	
			
	 
	Individual Property
	Operating Lease

	1.    
	Hyatt House Belmont
400 Concourse Drive
Belmont, CA 94002

	Operating Lease Agreement, dated as of April 1, 2004, by and between Innkeepers Summerfield General, L.P., as lessor (“Original Lessor”) and KPA Leaseco V, Inc., as lessee (“Original Lessee V”), as amended by (i) Amendment to Operating Lease, dated as of April 1, 2004, by and between Original Lessor and Original Lessee, (ii) Second Amendment to Operating Lease, dated as of October 27, 2011, by and between Grand Prix Belmont LLC (“Belmont Lessor”) and Grand Prix Fixed Lessee LLC (“Fixed Lessee”), and (iii) Third Amendment to Operating Lease, dated as of September 4, 2013, by and between Belmont Lessor and Fixed Lessee.

	2.    
	Residence Inn San Jose (Campbell)
2761 South Bascom Ave. 
Campbell, CA 95008
	Renewed and Restated Operating Lease Agreement, dated as of June 1, 2011, by and between Grand Prix Campbell/San Jose LLC “Campbell Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Campbell Lessor and Fixed Lessee, and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Campbell Lessor and Fixed Lessee.

	3.    
	Hyatt House El Segundo
810 South Douglas Street
El Segundo, CA 90245
	Operating Lease Agreement, dated as of April 1, 2004, Innkeepers Summerfield General II, L.P., as lessor (“Original Lessor II”) and KPA Leaseco IV, Inc., as lessee (“Original Lessee IV”), as amended by (i) Amendment to Operating Lease, dated as of April 1, 2004, by and between Original Lessor II and Original Lessee IV (ii) Second Amendment to Operating Lease, dated as of October 27, 2011, by and between Grand Prix El Segundo LLC (“El Segundo Lessor”) and Fixed Lessee and (iii) Third Amendment to Operating Lease, dated as of September 4, 2013, by and between El Segundo Lessor and Fixed Lessee.

	
			
	DOC ID - 21031260.28
	 
	 

Sched N-1

	
			
	 
	Individual Property
	Operating Lease

	4.    
	Residence Inn Fremont
5400 Farwell Place
Fremont, CA 94536
	Renewed and Restated Operating Lease Agreement, dated as of June 1, 2011, by and between Grand Prix Fremont LLC (“Fremont Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Fremont Lessor and Fixed Lessee, and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Fremont Lessor and Fixed Lessee.

	5.    
	Residence Inn Mountain View 1854 El Camino Real 
West Mountain View, CA 94040
	Renewed and Restated Operating Lease Agreement, dated as of June 1, 2011, by and between Grand Prix Mountain View LLC (“Mountain View Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Mountain View Lessor and Fixed Lessee, and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Mountain View Lessor and Fixed Lessee.

	6.    
	Residence Inn Ontario
2025 Convention Center Way Ontario, CA 91764
	Renewed and Restated Operating Lease Agreement, dated as of June 1, 2011, by and between Grand Prix Ontario LLC (“Ontario Lessor”) and Grand Prix Floating Lessee LLC (“Floating Lessee”), as amended by First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Ontario Lessor and Floating Lessee, as assigned by Floating Lessee to INK Lessee LLC (“INK Lessee”) by that certain Assignment and Assumption of Operating Lease Agreement, dated as of February 24, 2012, as further amended by Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Ontario Lessor and INK Lessee.

	7.    
	Residence Inn San Jose South 6111 San Ignacio Ave. 
San Jose, CA 95119
	Renewed and Operating Lease Agrement, dated as of June 1, 2011, by and between Grand Prix Campbell/San Jose LLC (“San Jose Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between San Jose Lessor and Fixed Lessee, and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between San Jose Lessor and Fixed Lessee.

	8.    
	Residence Inn San Mateo
2000 Winward Way
San Mateo, CA 94404
	Renewed and Restated Operating Lease Agreement, dated as of November 1, 2009, by and between Grand Prix San Mateo LLC (“San Mateo Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between San Mateo Lessor and Fixed Lessee.

	
			
	DOC ID - 21031260.28
	 
	 

Sched N-2

	
			
	 
	Individual Property
	Operating Lease

	9.    
	Residence Inn Silicon Valley I 
750 Lakeway Drive
Sunnyvale, CA 94085
	Renewed and Restated Operating Lease Agreement, dated as of November 1, 2009, by and between Grand Prix Sili I LLC (“Sili I Lessor”) and Fixed Lessee, as amended by First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Sili I Lessor and Fixed Lessee.

	10.    
	Residence Inn Silicon Valley II 1080 Stewart Drive
Sunnyvale, CA 94086
	Renewed and Restated Operating Lease Agreement, dated as of November 1, 2009, by and between Grand Prix Sili II LLC (“Sili II Lessor”) and Fixed Lessee, as amended by First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Sili II Lessor and Fixed Lessee.

	11.    
	Residence Inn Denver Downtown 2777 Zuni Street 
Denver, CO 80211
	Renewed and Restated Operating Lease Agreement, dated as of November 1, 2009, by and between Grand Prix Denver LLC (“Denver Lessor”) and Fixed Lessee, as amended by First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Denver Lessor and Fixed Lessee.

	12.    
	Residence Inn Denver South (Tech)
6565 South Yosemite Street
Englewood, CO 80111
	Renewed and Restated Operating Lease Agreement, dated as of June 1, 2011, by and between Grand Prix Englewood/Denver South LLC (“Englewood Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease Agreement, dated as of October 27, 2011, by and between Englewood Lessor and Fixed Lessee, and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Englewood Lessor and Fixed Lessee.

	13.    
	Residence Inn Shelton
1001 Bridgeport Ave.
Shelton, CT 06484
	Renewed and Restated Operating Lease Agreement, dated as of June 1, 2011, by and between Grand Prix Shelton LLC (“Shelton Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease Agreement, dated as of October 27, 2011, by and between Shelton Lessor and Fixed Lessee, and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Shelton Lessor and Fixed Lessee.

	14.    
	Residence Inn Windsor
I-91 at Bloomfield Ave. 
100 Dufney Lane
Windsor, CT 06095
	Renewed and Restated Operating Lease Agreement, dated as of June 1, 2011, by and between Grand Prix Windsor LLC (“Windsor Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease Agreement, dated as of October 27, 2011, by and between Windsor Lessor and Fixed Lessee, and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Windsor Lessor and Fixed Lessee.

	
			
	DOC ID - 21031260.28
	 
	 

Sched N-3

	
			
	 
	Individual Property
	Operating Lease

	15.    
	Residence Inn Altamonte Springs, 270 Douglas Ave.
Altamonte Springs, FL 32714
	Renewed and Restated Operating Lease Agreement, dated as of June 1, 2011, by and between Grand Prix Altamonte LLC (“Altamonte Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease Agreement, dated as of October 27, 2011, by and between Altamonte Lessor and Fixed Lessee, and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, Altamonte Lessor and Fixed Lessee.

	16.    
	Courtyard Fort Lauderdale
2440 W Cypress Creek Rd.
Fort Lauderdale, FL 33309
	Renewed and Restated Operating Lease Agreement, dated as of September 23, 2009, by and between Grand Prix Ft. Lauderdale LLC (“Ft. Lauderdale Lessor”) and Fixed Lessee, as amended by First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Ft. Lauderdale Lessor and Fixed Lessee.

	17.    
	Hampton Inn Naples
3210 Tamiami Trail North
Naples, FL 34102
	Renewed and Restated Operating Lease Agreement, dated as of September 23, 2009, by and between Grand Prix Naples LLC (“Naples Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Naples Lessor and Fixed Lessee, and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Naples Lessor and Fixed Lessee.

	18.    
	Four Points Ft. Walton Beach
1325 Miracle Strip 
Ft. Walton Beach, FL 32548
	Renewed and Restated Operating Lease Agreement, dated as of May 18, 2009, by and between KPA/GP Ft. Walton Beach LLC (“Ft. Walton Lessor”) and Floating Lessee, as amended by First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Ft. Walton Lessor and Floating Lessee, as assigned by Floating Lessee to INK Lessee by that certain Assignment and Assumption of Operating Lease Agreement, dated as of February 24, 2012, as further amended by Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Ft. Walton Lessor and INK Lessee.

	19.    
	Residence Inn Atlanta Peachtree, 5500 Triangle Drive 
Norcross, GA 30092
	Operating Lease Agreement, dated as of October 9, 1998, by and between Innkeepers RI General, L.P. (“Original Lessor RI”) and JF Hotel III, Inc. (“JF Lessee”), as amended by (i) First Amendment to Operating Lease, dated as of November 1, 2002, by and between Innkeepers Residence General, L.P. and Innkeepers Hospitality III, Inc. (f/k/a JF Lessee), and (ii) Second Amendment to Operating Lease, dated as of October 27, 2011, by and between Grand Prix Atlanta (Peachtree Corners) LLC and Fixed Lessee.

	
			
	DOC ID - 21031260.28
	 
	 

Sched N-4

	
			
	 
	Individual Property
	Operating Lease

	20.    
	Residence Inn Atlanta Downtown 134 Peachtree Street NW 
Atlanta, GA 30303
	Renewed and Restated Operating Lease Agreement, dated as of October 25, 2009, by and between Grand Prix Atlanta LLC (“Atlanta Lessor”) and Fixed Lessee, as amended by First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Atlanta Lessor and Fixed Lessee.

	21.    
	Residence Inn Rosemont/O'Hare
7101 Chestnut Street
Rosemont, IL 60018
	Operating Lease Agreement, dated as of January 8, 1999, by and between Original Lessor RI and JF Lessee, as amended by (i) First Amendment to Operating Lease Agreement, dated as of November 1, 2002, by and between Innkeepers Residence General, L.P. and Innkeepers Hospitality III, Inc. (f/k/a JF Lessee) as lessee, (ii) Operating Lease Amendment, dated as of June 29, 2007, by and between Grand Prix Chicago LLC (“Chicago Lessor”) and Fixed Lessee and (iii) Third Amendment to Operating Lease, dated as of October 27, 2011, by and between Chicago Lessor and Fixed Lessee.

	22.    
	Residence Inn Lexington (KY) North
1080 Newtown Pike
Lexington, KY 40511

	Renewed and Restated Operating Lease Agreement, dated as of June 1, 2011, by and between Grand Prix Lexington LLC (“Lexington Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease Agreement, dated as of October 27, 2011, by and between Lexington Lessor and Fixed Lessee, and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Lexington Lessor and Fixed Lessee.

	23.    
	Residence Inn Louisville North
120 North Hurstbourne Pkwy.
Louisville, KY 40222
	Renewed and Restated Operating Lease Agreement, dated as of June 1, 2011, by and between Grand Prix Louisville (RI) LLC (“Louisville Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease Agreement, dated as of October 27, 2011, by and between Louisville Lessor and Fixed Lessee, and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Louisville Lessor and Fixed Lessee.

	
			
	DOC ID - 21031260.28
	 
	 

Sched N-5

	
			
	 
	Individual Property
	Operating Lease

	24.    
	Hampton Inn Louisville Downtown
101 East Jefferson Street
Louisville, KY 40202
	Renewed and Restated Operating Lease Agreement, dated as of June 27, 2009, by and between KPA/GP Louisville (HI) LLC (“Louisville (HI) Lessor”) and Floating Lessee, as amended by First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Louisville (HI) Lessor and Floating Lessee, as assigned by Floating Lessee to INK Lessee by that certain Assignment and Assumption of Operating Lease Agreement, dated as of February 24, 2012, as further amended by Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Louisville (HI) Lessor and INK Lessee.

	25.    
	Hampton Inn Columbia
8880 Columbia 100 Park
Columbia, MD 21045
	Second Amended and Restated Operating Lease Agreement, dated as of September 4, 2013, by and between Grand Prix Columbia LLC and Fixed Lessee.

	26.    
	Residence Inn Gaithersburg
9721 Washingtonian Blvd.
Gaithersburg, MD 20878
	Second Amended and Restated Operating Lease Agreement, dated as of September 4, 2013, by and between Grand Prix Gaithersburg LLC and Fixed Lessee.

	27.    
	Sheraton Rockville
920 Redland Boulevard
Rockville, MD 20850
	Second Amended and Restated Operating Lease Agreement, dated as of September 4, 2013, by and between Grand Prix Rockville LLC and INK Lessee.

	28.    
	Residence Inn Portland
800 Roundwood Drive
Scarborough, ME 04074
	Renewed and Restated Operating Lease Agreement, dated as of November 1, 2009, by and between Grand Prix Portland LLC (“Portland Lessor”) and Fixed Lessee, as amended by First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Portland Lessor and Fixed Lessee.

	29.    
	Residence Inn Livonia
17250 Fox Drive
Livonia, MI 48152
	Operating Lease Agreement, dated as of March 12, 1999, by and Original Lessor RI and JF Lessee, as amended by (i) First Amendment to Operating Lease Agreement, dated as of November 1, 2002, by and between Innkeepers Residence General, L.P. and Innkeepers Hospitality III, Inc. (f/k/a JF Lessee), (ii) Second Amendment to Operating Lease, dated as of October 27, 2011, by and between Grand Prix Livonia LLC (“Livonia Lessor”) and Grand Prix Fixed Lessee LLC, and (iii) Third Amendment to Operating Lease, dated as of September 4, 2013, by and between Livonia Lessor and Fixed Lessee.

	
			
	DOC ID - 21031260.28
	 
	 

Sched N-6

	
			
	 
	Individual Property
	Operating Lease

	30.    
	Residence Inn Troy - SE (Madison Heights)
32650 Stephenson Highway
Madison Heights, MI 48071
	Renewed and Restated Operating Lease, dated as of June 1, 2011, by and between Grand Prix Troy (SE) LLC (“Troy Lessor”) and Floating Lessee, as amended by First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Troy Lessor and Floating Lessee, as assigned by Floating Lessee to INK Lessee by that certain Assignment and Assumption of Operating Lease Agreement, dated as of February 24, 2012, as further amended by Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Troy Lessor and INK Lessee.

	31.    
	Courtyard Atlantic City
1212 Pacific Avenue
Atlantic City, NJ 08401
	Operating Lease Agreement, dated as of June 25, 2007, by and between Innkeepers USA Limited Partnership (“Innkeepers USA Lessor”) and KPA Leaseco, Inc., (“Original Lessee”) as amended by Operating Lease Amendment, dated as of June 29, 2007, by and between Grand Prix Atlantic City LLC (“Atlantic City Lessor”) and Floating Lessee, as further amended by Second Amendment to Operating Lease, dated as of October 27, 2011, by and between Atlantic City Lessor and Floating Lessee, as assigned by Floating Lessee to INK Lessee by that certain Assignment and Assumption of Operating Lease Agreement, dated as of February 24, 2012.

	32.    
	Residence Inn Cherry Hill
1821 Old Cuthbert Road
Cherry Hill, NJ 08034
	Amended and Restated Operating Lease Agreement, dated as of October 27, 2011, by and between Grand Prix Cherry Hill LLC and Fixed Lessee.

	33.    
	Courtyard Montvale
Southwest Quadrant of Garden State Parkway and Grand Street
Montvale, NJ 07645
	Operating Lease Agreement, dated as of June 25, 2007, by and between Innkeepers USA Lessor and Original Lessee, as amended by First Amendment to Operating Lease, dated as of October 27, 2011, by and between Grand Prix Montvale LLC and Floating Lessee, as assigned by Floating Lessee to INK Lessee by that certain Assignment and Assumption of Operating Lease Agreement, dated as of February 24, 2012.

	
			
	DOC ID - 21031260.28
	 
	 

Sched N-7

	
			
	 
	Individual Property
	Operating Lease

	34.    
	Westin Governor Morristown
2 Whippany Road
Morristown, NJ 07960
	Renewed and Restated Operating Lease Agreement, dated as of May 21, 2010, by and between Grand Prix Morristown LLC (“Morristown Lessor”) and Floating Lessee, as amended by First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Morristown Lessor and Floating Lessee as assigned by Floating Lessee to INK Lessee by that certain Assignment and Assumption Agreement, dated as of February 24, 2012, as further amended by Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Morristown Lessor and INK Lessee. 

	35.    
	Hyatt House Mt. Laurel
3000 Crawford Place
Mount Laurel, NJ 08054
	Operating Lease Agreement, dated as of April 1, 2004, by and between Innkeepers Summerfield General II, L.P. and Original Lessee IV, as amended by (i) Amendment to Operating Lease Agreement, dated as of April 1, 2004, by and between Innkeepers Summerfield General II, L.P., and Original Lessee IV, (ii) Second Amendment to Operating Lease, dated as of October 27, 2011, by and between Grand Prix Mt. Laurel LLC (“Mt. Laurel Lessor”) and Fixed Lessee, and (iii) Third Amendment to Operating Lease, dated as of September 4, 2013, by and between Mt. Laurel Lessor and Fixed Lessee.

	36.    
	Residence Inn Saddle River
7 Boroline Road
Saddle River, NJ 07458
	Renewed and Restated Operating Lease Agreement, dated as of September 15, 2007, by and between Grand Prix Saddle River LLC (“Saddle River Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Saddle River Lessor and Fixed Lessee, and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Saddle River Lessor and Fixed Lessee.

	37.    
	Residence Inn Binghamton
4610 Vestal Pkwy East
Vestal, NY 13850
	Renewed and Restated Operating Lease Agreement, dated as of September 23, 2009, by and between Grand Prix Binghamton LLC (“Binghamton Lessor”) and Fixed Lessee, as amended by First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Binghamton Lessor and Fixed Lessee.

	
			
	DOC ID - 21031260.28
	 
	 

Sched N-8

	
			
	 
	Individual Property
	Operating Lease

	38.    
	Hampton Inn Islandia
1600 Veterans Memorial Highway
Islandia, NY 11749
	Renewed and Restated Operating Lease, dated as of September 23, 2009, by and between Grand Prix Islandia LLC (“Islandia Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Islandia Lessor and Fixed Lessee, and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Islandia Lessor and Fixed Lessee.

	39.    
	Residence Inn Harrisburg
4480 Lewis Road
Harrisburg, PA 17111
	Renewed and Restated Operating Lease, dated as of May 7, 2006, by and between Innkeepers USA Lessor and Original Lessee, as amended by Operating Lease Amendment, dated as of June 29, 2007, by and between Grand Prix Harrisburg LLC (“Harrisburg Lessor”) and Floating Lessee, as amended by Second Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Harrisburg Lessor and Floating Lessee, as assigned by Floating Lessee to INK Lessee by that certain Assignment and Assumption of Operating Lease Agreement, dated as of February 24, 2012.

	40.    
	TownePlace Suites Horsham
198 Precision Drive
Horsham, PA 19044
	Operating Lease Agreement, dated as of June 1, 1999, by and between Innkeepers USA Lessor and Innkeepers Hospitality III, Inc., as amended by (i) First Amendment to Operating Lease Agreement, dated as of November 1, 2002, by and between Innkeepers USA Lessor and Innkeepers Hospitality III, Inc. (f/k/a JF Lessee), (ii) Second Amendment to Operating Lease, dated as of October 27, 2011, by and between Grand Prix Horsham LLC (“Horsham Lessor”) and Fixed Lessee, and (iii) Third Amendment to Operating Lease, dated as of September 4, 2013, by and between Horsham Lessor and Fixed Lessee.

	41.    
	Hampton Inn Willow Grove
1500 Easton Road
Willow Grove, PA 19090
	Renewed and Restated Operating Lease Agreement, dated as of September 23, 2009, by and between Grand Prix Willow Grove LLC (“Willow Grove Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Willow Grove Lessor and Fixed Lessee and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Willow Grove Lessor and Fixed Lessee.

	
			
	DOC ID - 21031260.28
	 
	 

Sched N-9

	
			
	 
	Individual Property
	Operating Lease

	42.    
	Residence Inn Addison
14975 Quorum Dr.
Addison, TX 75240
	Renewed and Restated Operating Lease Agreement, dated as of February 1, 2010, by and between Grand Prix Addison (RI) LLC (“Addison (RI) Lessor”) and Fixed Lessee, as amended by First Amendment to Renewed and Restated Operating Lease Agreement, dated as of October 27, 2011, by and between Addison (RI) Lessor and Fixed Lessee.

	43.    
	Hyatt House Addison
4900 Edwin Lewis Drive
Addison, TX 75001
	Operating Lease Agreement, dated as of April 1, 2004, by and between Original Lessor II and Original Lessee IV, as amended by (i) Amendment to Operating Lease Agreement, dated as of April 1, 2004 by and between Original Lessor II and Original Lessee IV, (ii) Second Amendment to Operating Lease, dated as of October 27, 2011, by and between Grand Prix Addison (SS) LLC (“Addison (SS) Lessor”) and Floating Lessee, as assigned by Floating Lessee to INK Lessee by that certain Assignment and Assumption of Operating Lease Agreement, dated as of February 24, 2012, as further amended by (iii) Third Amendment to Operating Lease, dated as of September 4, 2013, by and between Addison (SS) Lessor and INK Lessee.

	44.    
	Residence Inn Arlington
1050 Brookhollow Plaza Drive
Arlington, TX 76006
	Renewed and Restated Operating Lease Agreement, dated as of February 1, 2010, by and between Grand Prix Arlington LLC (“Arlington Lessor”) and Fixed Lessee, as amended by First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Arlington Lessor and Fixed Lessee.

	45.    
	Hyatt House Las Colinas
5901 North MacArthur Boulevard Las Colinas, TX 75039
	Operating Lease Agreement, dated as of April 1, 2004, by and between Innkeepers Summerfield General, L.P., (“Summerfield Lessor”) and Original Lessee V, as amended by (i) Amendment to Operating Lease Agreement, dated as of April 1, 2004, by and between Summerfield Lessor Original Lessor V, (ii) Second Amendment to Operating Lease, dated as of October 27, 2011, by and between Grand Prix Las Colinas LLC (“Las Colinas Lessor”) and Fixed Lessee, and (iii) Third Amendment to Operating Lease, dated as of September 4, 2013, by and between Las Colinas Lessor and Fixed Lessee.

	
			
	DOC ID - 21031260.28
	 
	 

Sched N-10

	
			
	 
	Individual Property
	Operating Lease

	46.    
	Residence Inn Richmond NW
3940 Westerre Parkway
Richmond, VA 23233
	Operating Lease Agreement, dated as of January 8, 1999, by and between Original Lessor RI and JF Lessee, as amended by (i) First Amendment to Operating Lease Agreement, dated as of November 1, 2002, by and between Innkeepers Residence General, L.P. and Innkeepers Hospitality III, Inc. (f/k/a JF Lessee), (ii) Second Amendment to Operating Lease, dated as of October 27, 2011, by and between Grand Prix Richmond (Northwest) LLC (“Richmond (Northwest) Lessor”) and Fixed Lessee, and (iii) Third Amendment to Operating Lease, dated as of September 4, 2013, by and between Richmond (Northwest) Lessor and Fixed Lessee.

	47.    
	Residence Inn Richmond West
2121 Dickens Road
Richmond, VA 23230
	Renewed and Restated Operating Lease Agreement, dated as of June 1, 2011, by and between Grand Prix Richmond LLC (“Richmond Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Richmond Lessor and Fixed Lessee and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Richmond Lessor and Fixed Lessee.

	48.    
	Residence Inn Bellevue
14455 NE 29th Place
Bellevue, WA 98007
	Renewed and Restated Operating Lease Agreement, dated as of June 1, 2011, by and between Grand Prix Bellevue LLC (“Bellevue Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Bellevue Lessor and Fixed Lessee and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Bellevue Lessor and Fixed Lessee.

	49.    
	Residence Inn Bothell
11920 NE 195th Street
Bothell, WA 98011
	Renewed and Restated Operating Lease Agreement, dated as of June 1, 2011, by and between Grand Prix Bothell LLC (“Bothell Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Bothell Lessor and Fixed Lessee and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Bothell Lessor and Fixed Lessee.

	
			
	DOC ID - 21031260.28
	 
	 

Sched N-11

	
			
	 
	Individual Property
	Operating Lease

	50.    
	Residence Inn Lynnwood
18200 Alderwood Mall Parkway
Lynnwood, WA 98037
	Renewed and Restated Operating Lease Agreement, dated as of June 1, 2011, by and between Grand Prix Lynnwood LLC (“Lynnwood Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Lynnwood Lessor and Fixed Lessee and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Lynnwood Lessor and Fixed Lessee.

	51.    
	Residence Inn Tukwila
16201 West Valley Highway
Tukwila, WA 98188
	Renewed and Restated Operating Lease Agreement, dated as of June 1, 2011, by and between Grand Prix Tukwila LLC (“Tukwila Lessor”) and Fixed Lessee, as amended by (i) First Amendment to Renewed and Restated Operating Lease, dated as of October 27, 2011, by and between Tukwila Lessor and Fixed Lessee and (ii) Second Amendment to Renewed and Restated Operating Lease, dated as of September 4, 2013, by and between Tukwila Lessor and Fixed Lessee. 

*     *     *     *     *

[No further text on this page.]

	
			
	DOC ID - 21031260.28
	 
	 

Sched N-12

SCHEDULE O
Intentionally Omitted

*     *     *     *     *

[No further text on this page.]

	
			
	DOC ID - 21031260.28
	 
	 

Sched O-1

SCHEDULE P
Hotel Employees

[See Attached]

*     *     *     *     *

[No further text on this page.]

	
			
	DOC ID - 21031260.28
	 
	 

Sched P-1

SCHEDULE Q
Transfer Taxes
	
			
	STATE
	TITLE FEES
	TRANSFER TAXES

	California
	SELLER pays base premium; PURCHASER pays for extended coverage and all endorsements
	SELLER pays state, county, and city transfer taxes except:
•    San Jose (South) (City Tax): split 50/50
•    Mountain View (City Tax): split 50/50
•    San Mateo (City Tax): split 50/50

	Colorado
	SELLER pays base premium; PURCHASER pays for all endorsements
	N/A – no transfer tax

	Connecticut
	PURCHASER pays for title searches, base premium and all endorsements
	SELLER pays state and local conveyance taxes 

	Florida
	PURCHASER pays base premium and all endorsements
	N/A – no transfer tax

	Georgia
	PURCHASER pays base premium and all endorsements
	N/A – no transfer tax

	Illinois
	SELLER pays cost of abstract and policy premium; PURCHASER pays for all endorsements 
	SELLER pays state and county transfer taxes 
 
No local transfer taxes in the Village of Rosemont (where property located)

	Kentucky
	PURCHASER pays base premium and all endorsements and premium sales tax
	SELLER pays

	Maine
	PURCHASER pays base premium and all endorsements
	Split 50/50 

	Maryland
	PURCHASER pays base premium and all endorsements
	Split 50/50

	Michigan
	SELLER pays base premium; PURCHASER pays for all endorsements 
	SELLER pays state and county transfer tax by law 

	New Jersey
	PURCHASER pays base premium and all endorsements
	For an entity transfer, PURCHASER pays

	New York
	PURCHASER pays base premium and all endorsements
	SELLER pays

	Pennsylvania
	PURCHASER pays base premium and all endorsements
	Split 50/50

	Texas
	SELLER pays base premium; PURCHASER  pays for extended coverage and all endorsements
	N/A – no transfer tax

	
			
	DOC ID - 21031260.28
	 
	 

Sched Q-1

	
			
	Virginia
	PURCHASER pays base premium and all endorsements
	N/A – no transfer tax

	Washington
	SELLER pays base premium and sales tax thereon; PURCHASER  pays for extended coverage and all endorsements and sales tax thereon
	SELLER pays 

*     *     *     *     *

[No further text on this page.]

	
			
	DOC ID - 21031260.28
	 
	 

Sched Q-2

EXHIBIT 1
Escrow Agent's Wire Instructions

NEW YORK CITY COMMERCIAL
WIRE INSTRUCTIONS
                                                    

ABA#:                021000021

SWIFT CODE:            CHASUS33

BANK:                JP MORGAN CHASE
REAL ESTATE DIVISION
707 Travis, 6th Flr South
Houston, TX 77002

ACCT#:                006-171176

		
	ACCT NAME:
	FIDELITY NATIONAL TITLE 

INSURANCE COMPANY 

FNT CONTACT:            Accounting Department
212- 481-5858

                    
FNT TITLE#/REFERENCE:     32511 / InnKeepers
    
TITLE OFFICER:              Dina Pupovic / John Maddie    

	
			
	DOC ID - 21031260.28
	 
	 

Exh 1-1

EXHIBIT 2
Form of FIRPTA Affidavit
Section 1445 of the Internal Revenue Code provides that a transferee of a U.S. real property interest must withhold tax if the transferor is a foreign person.  To inform the transferee that withholding of tax is not required upon the disposition of a U.S. real property interest by _____________, the undersigned hereby certifies the following on behalf of _____________ ("Seller").
1.    Seller is not a foreign corporation, foreign partnership, foreign trust, or foreign estate (as such terms are defined in the Internal Revenue Code and Income Tax Regulations).
2.    Seller's U.S. employer identification number is __________.
3.    Seller's office is:
_____________ 
_____________ 
_____________ 
_________, _________ 

The undersigned understands that this certification may be disclosed to the Internal Revenue Service by the transferee and that any false statement contained herein could be punished by fine, imprisonment, or both.
Under penalties of perjury I declare that I have examined this certification and to the best of my knowledge and belief it is true, correct and complete, and I further declare that I have authority to sign this document on behalf of Seller.
_____________  
 
 
By:    ___________________________  
    Name: 
    Title:
_________________, 201___

	
			
	DOC ID - 21031260.28
	 
	 

Exh 2-1

EXHIBIT 3
Form of Assignment and Assumption Agreement

THIS ASSIGNMENT AND ASSUMPTION AGREEMENT (this "Agreement"), is dated as of [__________] (the "Effective Date"), by and between [_______________], a [________________] ("Assignor"), as assignor, and [________________], a [________________] ("Assignee"), as assignee.

WHEREAS, Assignor owns a [________]% membership interest (the "Interest") in [________________], a limited liability company organized under the laws of the State of Delaware (the "LLC") pursuant to the terms of that certain [Limited Liability Company Operating Agreement] of the LLC (the "LLC Agreement"), dated as of [___________];

WHEREAS, Assignor has agreed to assign and convey to Assignee 100% of its interest in the LLC (the "Assigned Interest"), and to cause Assignee to be admitted to the LLC as a Member, in accordance with the terms of the LLC Agreement; and

WHEREAS, Assignee wishes to obtain and acquire the Assigned Interest.

NOW, THEREFORE, in consideration of Ten Dollars ($10.00) paid, the mutual agreements and covenants contained herein, and other good and valuable consideration, the receipt, adequacy and sufficiency of which is hereby acknowledged, the parties agree as follows:

1.    Assignment of the Assigned Interest.  Assignor hereby assigns, conveys and transfers to Assignee, its successors and assigns, as of the Effective Date, all of its right, title and interest in and to the Assigned Interest, including, without limitation, all allocations of profits and losses, and distributions of cash or other property, represented by such interest, and other rights otherwise accruing to Assignee by virtue of owning the Assigned Interest, subject in each case to the terms and conditions associated with such Assigned Interest, in its capacity as a member of the LLC, set forth in the LLC Agreement.

2.    Acceptance by Assignee.  Assignee hereby accepts the assignment of the Assigned Interest and assumes and agrees to be bound by and perform the obligations under the LLC Agreement in respect of all of its interest in the LLC. 

3.    Governing Law.  This Agreement shall be construed and enforced in accordance with the laws of the State of New York.

4.    Construction.  The rights and obligations of the parties hereto, including under Paragraphs 1 and 2 hereof, shall be subject to and governed by the provisions of the LLC Agreement.

DOC ID - 21031260.11
DOC ID - 21031260.28

5.    Counterparts.  This Agreement may be executed in one or more counterparts, which, taken together, shall constitute one fully-executed original Agreement.

	
			
	DOC ID - 21031260.28
	 
	 

3

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered as of the Effective Date.

ASSIGNOR:

[__________________], a [_________________] 

By:    __________________________
Name:
Title:
 
ASSIGNEE:

[___________________], a [_____________________]

By:                    
Name: 
Title: 

	
			
	DOC ID - 21031260.28
	 
	 

EXHIBIT 4
Form of Ground Lease Estoppel Certificate

This ESTOPPEL CERTIFICATE is given this ___ day of ____________, 2014, by the CITY OF FORT LAUDERDALE, a municipal corporation of the State of Florida, for the benefit of the ground lessee of Parcel 8F2 and [_______] ("Lender"), together with their respective successors and/or assigns pertaining to: Parcel 8F2 and certifies:

The following estoppel information is being provided for the above-referenced airport ground lease dated August 1, 1984 as amended on May 21, 1987, July 6, 1988 and July 30, 1993 (the "Ground Lease").

1.Tenant/Borrower:                         Grand Prix Ft. Lauderdale LLC                          .
2.Address of tenant:                        2440 NW 62 Street                                            .
3.Lease commencement date:        August 1, 1984                                                   .
4.Lease expiration date:                  July 31, 2034                                                     .
5.Amount of annual rent:                 $[___________]                                                 .
6.Amount of security deposit:          $0                                                                        .
7.Date of last payment received:     [________________]                                         .
8.Date of next rent payment due:    [________________]                                               .
9.Next rent adjustment:                   August 1, 2014                                                   .
10.Any other outstanding sums:       [Broward County Property Taxes of $100,491.44].
11.Credits and/or offsets:                 $0                                                                           .
12.Special assessments:                   $0                                                                          .
13.Any existing violations or defaults under the lease:           None                                .
14.The Ground Lease constitutes the entire understanding between the City and the Tenant/Borrower.
15.The Ground Lease is in full force and effect.  
16.There are no defenses, claims against Tenant or offsets which are presently known by the City and which may be asserted by the City against the Tenant in respect of the obligations under the Ground Lease.

LESSOR:

CITY OF FORT LAUDERDALE, a municipal corporation of the State of Florida

By:  _________________________________
Clara Bennett, Airport Manager

cc:    Cate McCaffery, Director of Business Enterprises     
Victoria Minard, Assistant City Attorney
    

	
			
	DOC ID - 21031260.28CLDT-EX10.2ThirdAmendedandRestatedINKLLCAgreement

Exhibit 10.2

THE TRANSFER OF THE LIMITED LIABILITY COMPANY INTERESTS DESCRIBED IN THIS AGREEMENT IS RESTRICTED AS DESCRIBED HEREIN.
THIRD AMENDED AND RESTATED
LIMITED LIABILITY COMPANY AGREEMENT
OF
INK ACQUISITION LLC,
a Delaware Limited Liability Company
THIS THIRD AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT (together with the schedules and exhibits hereto, this “Agreement”), of INK Acquisition LLC, a Delaware limited liability company (the “Company”), is made effective as of June 9, 2014 (the “Effective Date”) by and between Platform Member-T, LLC (“NS Managing Member”) and Chatham Lodging, L.P. (“Chatham Managing Member”, and, together with NS Managing Member and any other Person who becomes a member of the Company from time to time in accordance with the provisions hereof, the “Members”).

RECITALS:
A Certificate of Formation of the Company was filed with the Secretary of State of the State of Delaware on April 15, 2011;
Each of the Cerberus Member and Chatham Managing Member previously acquired a percentage interest in the Company and entered into the Second Amended and Restated Limited Liability Company Agreement of the Company dated as of October 27, 2011 (the “Prior Agreement”);
As of the Effective Date, NS Managing Member is acquiring all of the Cerberus Member’s right, title and interest to the membership interests in the Company (such interests, the “Cerberus Interests”), and concurrently therewith, the Cerberus Member is withdrawing as a member of the Company; and

The Members desire to amend and restate the Prior Agreement in its entirety on the terms and conditions hereinafter set forth.

NOW, THEREFORE, in consideration of the mutual promises and agreements herein made and intending to be legally bound hereby, the parties hereto amend and restate the Prior Agreement in its entirety and agree as follows:
ARTICLE I. 
 
GENERAL PROVISIONS; ORGANIZATION; STRUCTURE
Section 1.1    Registered Office.  The registered agent and office of the Company in the State of Delaware shall be Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware, 19801.  The Managing Member, after giving notice to the other Members, may change the registered office from one location to another in the State of Delaware.
Section 1.2    Place of Business; Offices.  The principal place of business of the Company, where the books and records of the Company shall be kept, shall be c/o Chatham Lodging LP, 50 Cocoanut Row, Suite 200, Palm Beach, FL  33480.  The Company may, at any time, change the location of the principal office of the Company or have one or more offices as may be established from time to time.
Section 1.3    Purpose; Nature of Business Permitted; Powers; Title to Property.  
(a)    The purpose to be conducted or promoted by the Company is to engage in the following activities:
(i)    to acquire, own, hold, manage, operate, lease, sell, transfer, service, convey, safekeep, dispose of, pledge, assign, borrow money against, finance, refinance or otherwise deal with the Business and the Properties and any portion thereof with unrelated third parties or with affiliated entities;
(ii)    to acquire, own, hold, sell, transfer, service, convey, safekeep, dispose of, pledge, assign, borrow money against, finance, refinance or otherwise deal with, publicly or privately issued securities and whether with unrelated third parties or with affiliated entities, in each case in connection with the Business and the Properties;
(iii)    to own equity interests in other limited liability companies, partnerships or other entities whose purposes are restricted to those set forth in clauses (i) and (ii) above; and
(iv)    to engage in any other lawful act or activity and to exercise any powers permitted to limited liability companies organized under the laws of the State of Delaware that are related or incidental to and necessary, convenient or advisable for the accomplishment of the above-mentioned purposes (including the entering into of interest rate or basis swap, cap, floor or collar agreements, or similar hedging transactions and referral, management, servicing and administration agreements).
(b)    The Company shall not engage in any other business or activity.  Except as otherwise provided in Section 1.10 hereof and except for contracts customarily entered into by a property management agent on behalf of a hotel property owner, all property acquired in connection with the business of the Company shall be held by the Company in its own name, and all contracts and leases of real or personal property by or to the Company shall be made in its own name.
(c)    Title to assets of the Company, whether real, personal or mixed, tangible or intangible, shall be deemed to be owned by the Company, and no Member, individually or collectively, shall have any ownership interest in such assets or any portion thereof.
Section 1.4    [Reserved]
Section 1.5    Tax Classification; No State Law Partnership; REIT Qualifications.  (a)  The Members intend that the Company shall be treated as a partnership for federal, state and local tax purposes.  Each Member and the Company agree to file all tax returns and otherwise take all tax and financial reporting positions in a manner consistent with such treatment.  No provision of this Agreement shall be deemed or construed to constitute the Company (including its subsidiaries) as a partnership (including a limited partnership) or joint venture, or any Member as a partner of or with any other Member for any purposes other than tax purposes.
(b)    As of the Effective Date, NS Managing Member shall be owned, directly or indirectly, by NS REIT and Chatham Managing Member shall be owned, directly or indirectly, by Chatham REIT.  Each of Chatham REIT and NS REIT intend to qualify as a REIT, and the Members intend that the Company shall own the Properties in a manner that will not jeopardize the REIT status of either Chatham REIT or NS REIT.  Accordingly, the Property Companies will lease the Properties to the Property Leasecos pursuant to arm’s-length leases and the Property Leasecos will engage Island Hospitality Management or another entity that qualifies as an “eligible independent contractor” under Code Section 856(d)(9) to operate the Properties on their behalf.
Section 1.6    Definitions.  Unless the context otherwise requires, the terms defined in this Section 1.6 shall, for the purposes of this Agreement, have the meanings herein specified (such meanings to be equally applicable to both the singular and plural forms of the terms defined).
“1933 Act” has the meaning set forth in Section 12.16.
“1940 Act” means the Investment Company Act of 1940, as amended, and the rules and regulations thereunder.
“Accountants” means PricewaterhouseCoopers LLP or such other independent accounting firm of national reputation that is selected by NS Managing Member.
“Act” means the Delaware Limited Liability Company Act (as it may be amended from time to time and any successor to such Act).
“Additional Capital Contribution” means any Capital Contribution made by a Member pursuant to Section 2.2(b) hereof.
“Adjusted Asset Purchase Price” is the (a) Asset Purchase Price, plus (b) Buy/Sell Additions, minus (c) Buy/Sell Prorations which would be credited to a purchaser if the Buy/Sell Assets were being sold to a third party on the Buy/Sell Closing Date, plus (d) Buy/Sell Prorations which would be credited to a seller if the Buy/Sell Assets were being sold to a third party on the Buy/Sell Closing Date minus (e) the amount required to repay in full any outstanding Buy/Sell Third Party Loans as if same was paid off at the Buy/Sell Closing, minus (f) any other existing liabilities of the Company and the Property Companies that have not been otherwise taken into consideration as part of the Buy/Sell Prorations minus (g) the net proceeds from the sale of any Asset that is consummated after delivery of the Buy/Sell Notice and before the Buy/Sell Closing Date, appropriately adjusted to take into account any proceeds that are held in any reserves or escrows for a contingent liability which may arise after the Buy/Sell Closing Date (it being acknowledged and agreed to by the Members that any such proceeds that are held in any reserves or escrows shall be distributed to the Members pursuant to Section 7.1 as if it was in effect upon the release or distribution of such amounts after the Buy/Sell Closing Date).
“Adjusted Fair Market Value” means, the (a) the Fair Market Value, plus (b) Fair Market Value Additions, minus (c) Fair Market Value Prorations which would be credited to a purchaser if the Assets were being sold to a third party on the Option Closing Date (which prorations shall be as of 11:59 p.m. of the day preceding the Option Closing Date), plus (d) Fair Market Value Prorations which would be credited to a seller if the Assets were being sold to a third party on the Option Closing Date (which prorations shall be as of 11:59 p.m. of the day preceding the Option Closing Date), minus (e) the amount required to repay in full any outstanding Loans as if same were paid off at the Option Closing, minus (f) any other existing liabilities of the Company and the Property Companies that have not been otherwise taken into consideration as part of the Fair Market Value Prorations.
“Affiliate” means, with respect to a Person, another Person that directly or indirectly controls, is controlled by or is under common control with such first Person.  For the avoidance of doubt, Island Hospitality Management shall not be considered to be an Affiliate of Chatham REIT or any of its Affiliates.
 “Agreement” has the meaning set forth in the Preamble.
“Allocation Schedule” has the meaning set forth in Section 5.1(c).
“Appraisal Period” has the meaning set forth in Section 3.8(d)(i).
“Appraiser” has the meaning set forth in Section 3.8(d)(i).
“Approved FATF Country” shall mean any country that is a member of the Financial Action Task Force on Money Laundering, as such list may be amended, from time to time, and as approved in this Agreement.  As of the date of this Agreement, the following countries are Approved FATF Country members:  Argentina, Australia, Austria, Belgium, Brazil, Canada, Denmark, Finland, France, Germany, Greece, Hong Kong, Iceland, Ireland, Italy, Japan, Luxembourg, Mexico, Kingdom of the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, Turkey, United Kingdom and the United States.
“Approved Severance Costs” means any severance payable to Chatham Company Personnel to the extent such severance (i) for a senior Chatham Company Personnel does not exceed three (3) months of such employee’s monthly salary, (ii) for any other Chatham Company Personnel is determined by Chatham Managing Member in accordance with such employee’s position and seniority and does not exceed two (2) months of such employee’s monthly salary or (iii) otherwise has been approved by NS Managing Member or NS Ink III Managing Member at the time of grant to the applicable Chatham Company Personnel, it being understood that any severance costs shall be deemed to be Approved Severance Costs if such costs are in accordance with the terms of the then-approved Operating Budget and the then-approved Business Plan.
“Asset” means an asset owned by the Company or its Subsidiaries.
“Asset Purchase Price” has the meaning set forth in Section 3.7(a). 
“Available Cash” means, as the context requires, Available Cash From Capital Event or Available Cash From Operations, as applicable. 

“Available Cash From Capital Event” means cash paid to or in the possession of, the Company from the occurrence of a Capital Event after deducting therefrom (a) if a sale, all expenses of the sale (including, without limitation, transfer taxes, legal fees, brokerage expenses, marketing expenses, and other third party expenses of every kind or nature), (b) if a financing or a refinancing, all expenses of the financing or refinancing (including, without limitation, legal fees, points, lender charges, mortgage or indebtedness taxes and other third party expenses of every kind or nature), (c) if a casualty or condemnation, all expenses arising from such casualty or condemnation (including, without limitation, legal fees, costs of settlement of any awards or payments, and other third party expenses of every kind or nature), (d) if a sale, all funds necessary to pay for any currently payable obligations of the applicable Property Company or Asset, as applicable, (e) if a sale, the payment of all currently payable debt service, reserve and escrow amounts for all outstanding Loans that pertain to the applicable Property Company or Company Asset, (f) if a sale, the payment of all other currently payable obligations of the Company and the applicable Property Company to third parties, including, without limitation, obligations in connection with the applicable Property Company or Assets, and (g) if a sale, an amount equal to the Working Capital Sale Reserve. 

“Available Cash From Operations” means cash paid to or in the possession of, the Company from whatever source (other than Available Cash From Capital Event) after deducting therefrom (a) all funds necessary to pay for the currently payable expenses incurred in connection with the normal operations of the Company and the Property Companies in accordance with and subject to the terms hereof, (b) the payment of all currently payable debt service, reserve and escrow amounts for all outstanding Loans when and as they become due and payable and/or are required to be reserved or escrowed, (c) the payment of all other currently payable obligations of the Company and the Property Companies to third parties, including, without limitation, obligations in connection with the Assets, and (d) an amount equal to the Working Capital Operating Reserve.

“Bankruptcy” means, with respect to any Person, a “Voluntary Bankruptcy” or an “Involuntary Bankruptcy”.  A “Voluntary Bankruptcy” shall mean, with respect to any Person, (a) an admission in writing by such Person of its inability to pay its debts generally or a general assignment by such Person for the benefit of creditors, (b) the filing of any petition or answer by such Person seeking to adjudicate it bankrupt or insolvent or seeking for itself any liquidation, winding up, reorganization, arrangement, adjustment, protection, relief or composition of such Person or its debts under any law relating to bankruptcy, insolvency, reorganization or relief of debtors, or seeking, consenting to or acquiescing in the entry of an order for relief or the appointment of a receiver, trustee, custodian or other similar official for such Person or for any substantial part of its property, or (c) corporate action taken by such Person to authorize any of the actions set forth above.  An “Involuntary Bankruptcy” shall mean, with respect to any Person, without the consent or acquiescence of such Person, the entering of an order for relief or approving a petition for relief or reorganization or any other petition seeking any reorganization, arrangement, composition, readjustment, liquidation, dissolution or other similar relief under any present or future bankruptcy, insolvency or similar statute, law or regulation or the filing of any such petition against such Person which order or petition shall not be dismissed within 90 days or, without the consent or acquiescence of such Person, the entering of an order appointing a trustee, custodian, receiver or liquidator of such Person or of all or any substantial part of the property of such Person which order shall not be dismissed within 90 days.
“Bankruptcy Court” means the United States Bankruptcy Court for the Southern District of New York.
“Business” means (a) the ownership, lease and operation of the Properties, and (b) any other business of the Company, directly or indirectly related, incidental to or connected with the foregoing.
“Business Day” means any day other than a Saturday, Sunday or any other day on which banks in New York City are required or permitted by law to be closed. 
“Business Plan” means the comprehensive strategic plan for the Company’s and Ink III’s ownership, operation, leasing, financing and sale of the Properties, as in effect from time to time pursuant to Section 3.5 hereof.
“Buy/Sell Additions” means the following additions to the Asset Purchase Price: (a) cash in the bank accounts of the Company and each Property Company (including, without limitation, cash in bank accounts established with or by third parties for the benefit of the Company and each Property Company (e.g., lockbox accounts, accounts under Hotel Management Agreements, third party property management agreements, reserves under franchise agreements, etc.)) and other Company and Property Company revenues as of the Buy/Sell Closing Date, (b) net accounts receivable received by the Company and the Property Companies (other than rents or similar payments from tenants, licensees, concessionaires or similar parties) as of the Buy/Sell Closing Date (c) any utility deposits made by the Property Companies and (d) cash deposited securing any bonds, letters of credit, or other amounts posted by the Company or any Property Company.  

“Buy/Sell Assets” means the Assets being purchased or sold pursuant to Section 3.7.

“Buy/Sell Closing” has the meaning set forth in Schedule G attached hereto.

“Buy/Sell Closing Date” means the date designated by the Purchasing Member for the Buy/Sell Closing, which date shall be no later than the date which is sixty (60) days after delivery of the Buy/Sell Response.

“Buy/Sell Deposit Funds” means all sums deposited with the Buy/Sell Escrow Agent pursuant to the provisions of Section 3.7 (including the Proposing Member’s Deposit (if the Purchasing Member is the Proposing Member) or the Non-Proposing Member’s Deposit (if the Purchasing Member is the Non-Proposing Member)), together with all interest earned thereon.

“Buy/Sell Escrow Agent” has the meaning set forth in Section 3.7(a).

“Buy/Sell Membership Interest Purchase Price” means a price for the sale by the Selling Member(s) of their interest in the Company calculated as equal to the amount that would be received by the Selling Member(s) pursuant to the application of the provisions of Section 7.1, if the Assets were sold to a third party on the Buy/Sell Closing Date for a net purchase price equal to the Adjusted Asset Purchase Price (it being agreed that any disputes as to Buy/Sell Additions and/or Buy/Sell Prorations shall be resolved by the determination of the Accountants, which determination shall be binding on the Members, absent manifest error).

“Buy/Sell Notice” has the meaning set forth in Section 3.7(a).

“Buy/Sell Prorations” means the following prorations and adjustments to the Asset Purchase Price (which prorations shall be deducted from or added to the Asset Purchase Price in the same manner as deductions or additions to a sale price would occur between a buyer and seller in an arms-length transaction in connection with a sale of the Assets to a third party)): (a) rents, occupancy charges and similar revenues paid or payable by the Company or the Property Companies, (b) rents and other amounts payable by the Property Companies under or pursuant to any ground leases (if applicable), (c) real estate taxes in respect of the Assets, (d) any other taxes and/or assessments affecting the Company, the Property Companies or the Assets (other than income taxes or gross receipt taxes), (e) insurance premiums due and payable (or paid) with respect to the Company, the Property Companies or the Assets, (f) license and/or permit fees that are either due and payable or have been prepaid with respect to the Company or the Property Companies, (g) utility charges that are either due and payable or have been prepaid with respect to the Assets, the Company or the Property Companies, (h) the cost of any fuel oil on hand at the Properties, (i) amounts paid or payable under service, management, development or construction contracts entered into by the Company or the Property Companies, and (j) any accounts payable of the Company or the Property Companies outstanding as of the Buy/Sell Closing Date.  

“Buy/Sell Response” has the meaning set forth in Section 3.7(b).

“Buy/Sell Response Period” means the date which is thirty (30) days after the date of delivery of a Buy/Sell Proposal.  

“Buy/Sell Third Party Loans” means all Loans outstanding with respect to the Company and the Property Companies as of the Buy/Sell Closing Date. 

“Call Notice” has the meaning set forth in Section 3.8(b).

“Call Option” has the meaning set forth in Section 3.8(c)(i).
“Call Option Commencement Date” has the meaning set forth in Section 3.8(b).

“Capital Account” has the meaning set forth in Section 2.3(a).

“Capital Call” shall mean a written notice to the Members calling for a Capital Contribution, which written notice shall include (a) the total amount of the Capital Contribution then required, (b) a brief description of the expenditures or obligations giving rise to the requirement for such Capital Contribution, (c) each Member’s proportionate share of the total Capital Contribution as then required by this Agreement, (d) the date by which each Member’s Capital Contribution is required to be made, which date shall be thirty (30) days after such written notice has been given or such other date as may be agreed to by the Members, and (e) the account of the Company to which such Capital Contributions must be paid.

“Capital Contribution” means with respect to any Member, the sum of the Effective Date Deemed Capital Contribution and Additional Capital Contributions made by such Member.  For the avoidance of doubt, Priming Capital Contributions shall not be considered Capital Contributions for purposes of this definition.
“Capital Event” means (i) the sale of any Asset, (ii) a financing or refinancing of an Asset, (iii) the receipt of insurance proceeds or condemnation awards in connection with the ownership of an Asset (which proceeds are not used for restoration in connection with the applicable casualty or condemnation) or (iv) other transactions which, in accordance with generally accepted accounting principles, consistently applied, would be treated as a capital event. 
“Carveout Guarantor” has the meaning set forth in Section 1.11(c).
“Carveout Guaranty” means any guaranty of non-recourse carveouts or indemnity for environmental liabilities given to a Lender in connection with any Loan, which guaranty or indemnity is in form and substance satisfactory to the applicable Lender and approved in advance in writing by the Members (including, without limitation, any such guaranty or indemnity required by Current Lender in connection with the JPM Loan, it being agreed that the “Guarantees” as defined in the Contribution Agreement are approved by the Members).
“Cerberus Interests” has the meaning set forth in the Recitals.
“Cerberus Member” means CRE-Ink REIT Member, LLC, CRE-Ink REIT Member IV, LLC, CRE-Ink REIT Member V, LLC, CRE-Ink REIT Member VI, LLC and CRE-Ink REIT Member VII, LLC.
“Certificate of Formation” means the Certificate of Formation referred to in the Recitals and any and all amendments thereto and restatements thereof filed on behalf of the Company with the office of the Secretary of State of the State of Delaware pursuant to the Act.
“Change in Control” means, as of any date, (i) with respect to NS Managing Member, the failure of NS Managing Member to be Controlled by NS Parent and (ii) with respect to Chatham Managing Member, the failure of the Chatham Managing Member to be Controlled by Chatham REIT or any entity that succeeds to all or substantially all of the assets and liabilities thereof (whether by merger, consolidation or otherwise).  
 “Chatham Company Personnel” means any personnel employed by Chatham Managing Member (or one of its Affiliates other than Ink III or the Company) solely for the purpose of providing asset management services to the Company and/or Ink III, the employment generally of whom, including compensation and severance other than Approved Severance Costs, if any, payable to such personnel, has been approved by NS Managing Member and NS Ink III Managing Member.
“Chatham Competitor” shall mean (a) a Person that is then in a pending material litigation filed in court with Chatham REIT  or any Affiliate of Chatham REIT that has been disclosed by Chatham REIT or its Affiliate entity in public filings with the Securities and Exchange Commission (other than (1) litigation in connection with the applicable Parent Change in Control with respect to NS Parent and (2) litigation involving individuals who are directors or officers of Chatham REIT unrelated to their capacity as such); or (b) (i) a publicly traded hotel REIT the stock of which is traded on a national stock exchange or (ii) a lodging-focused hotel company that owns or operates at least 50 hotels (it being acknowledged and agreed to by the parties that for purposes of clause (i) and (ii), an entity which is Controlled by NS Parent shall not constitute a Chatham Competitor, provided that if NS Parent undergoes a Parent Change in Control in a transaction with a Chatham Competitor, NS Parent shall be deemed to be a Chatham Competitor.
“Chatham Guarantor” has the meaning set forth in Section 1.11(c).
“Chatham Guaranty” means that certain Guaranty of Recourse Obligations, dated as of the Effective Date, by Chatham REIT in favor of the beneficiaries thereof, as same may be hereafter amended or modified.  
“Chatham Ink III Managing Member” means Chatham TRS Holding, Inc.
“Chatham Managing Member” has the meaning set forth in the Preamble.
“Chatham Managing Member Effective Date Deemed Capital Contribution” has the meaning set forth in Section 2.2(a).
“Chatham Principal” means Jeffrey Fisher.
“Chatham REIT” means Chatham Lodging Trust, a Maryland real estate investment trust.
“Close Associate” means a Person who is widely and publicly known (or is actually known) to be a close associate of a Senior Foreign Political Figure.
“Code” means the Internal Revenue Code of 1986, as amended from time to time.
“Company” has the meaning set forth in the Preamble.
“Contributing Members” has the meaning set forth in Section 2.2(d).
“Control” means, with respect to any Person, the power of another Person, through ownership of equity, contract rights or otherwise, to direct the management and policies of such Person, and “Controlled” and “Controlling” have correlative meanings.
“Covered Entity” means (a) NS, (b) any Person acquiring all or substantially all of the assets of NS, and (c) any Person acquiring all or substantially all of a class of assets of NS, provided, in the case of each of clauses (a) through (c), that the equity value of NS Managing Member does not exceed 50% of the value of such Person, provided, further, that the condition set forth in the preceding proviso need not be satisfied in the case of a Permitted Corporate Transaction that is a spin-off described in clause (vii) of the definition thereof.
 “Cure” means, with respect to any action or failure to act triggering a right to Cure, that such action or failure to act, to the extent that it triggered the right to Cure, has been discontinued, and all parties adversely affected by such action or failure to act have been made whole in all material respects as if such action or failure to act had not occurred.
“Current Lender” means JPMorgan Chase Bank, National Association.
“Depreciation” means, for each Fiscal Period, an amount equal to the depreciation, amortization or other cost recovery deduction allowable with respect to an asset for such Fiscal Period, except that if the Gross Asset Value of such asset differs from its adjusted basis for federal income tax purposes at the beginning of such Fiscal Period, Depreciation shall be an amount that bears the same ratio to such beginning Gross Asset Value as the federal income tax depreciation, amortization, or other cost recovery deduction for such Fiscal Period bears to such beginning adjusted tax basis; provided, however, that if the adjusted basis for federal income tax purposes of an asset at the beginning of such Fiscal Period is zero, Depreciation shall be determined with reference to such beginning Gross Asset Value using any reasonable method selected by the Tax Matters Member.
“Effective Date” has the meaning set forth in the Preamble.
“Effective Date Deemed Capital Contributions” means (a) with respect to a Member, as the context requires, either the NS Managing Member Effective Date Deemed Capital Contributions or the Chatham Managing Member Effective Date Deemed Capital Contributions made by such Member and (b) with respect to all Members, all NS Managing Member Effective Date Deemed Capital Contributions and all Chatham Managing Member Effective Date Deemed Capital Contributions, collectively.
 “Environmental Law” means all applicable laws, including, for this purpose, all common law, governing public health or safety, workplace health or safety, pollution or the protection of the environment.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.
“Excess Promote Amount” has the meaning set forth in Section 7.4(a).

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.
“Expedited Arbitration” has the meaning set forth in Section 3.2(i).
“Expense Reimbursement” has the meaning set forth in Section 3.1(c).
“Failed Contribution” has the meaning set forth in Section 2.2(d).
“Fair Market Value” means (a) the Initiating Party Fair Market Value, if the Notice Recipient accepts the Initiating Party Fair Market Value pursuant to Section 3.8(c), (b) the fair market value agreed upon by and between the Initiating Party and the Notice Recipient pursuant to Section 3.8(c)(v) or (c) the fair market value determined pursuant to the appraisal process described in Section 3.8(d).
“Fair Market Value Additions” means only the following additions to the Fair Market Value:  (a) cash in the bank accounts of the Company and each Property Company (including, without limitation, cash in bank accounts established with or by third parties for the benefit of the Company and each Property Company (e.g., lockbox accounts, accounts under Hotel Management Agreements, third party property management agreements, reserves under franchise agreements, etc.)) and other Company and Property Company revenues as of the Option Closing Date, (b) net accounts receivable accrued by the Company and the Property Companies (other than rents or similar payments from tenants, licensees, concessionaires or similar parties) as of the Option Closing Date, (c) any utility deposits made by the Property Companies, and (d) cash deposited securing any bonds, letters of credit, or other amounts posted by the Company or any Property Company. 
“Fair Market Value Prorations” means the following prorations and adjustments to the Fair Market Value (which prorations shall be deducted from or added to the Fair Market Value in the same manner as deductions or additions to a sale price would occur between a buyer and seller in an arms-length transaction in connection with a sale of the Assets to a third party):  (a) rents, occupancy charges and similar revenues paid or payable by the Company or the Property Companies, (b) rents and other amounts payable by the Property Companies under or pursuant to any ground leases (if applicable), (c) real estate taxes in respect of the Assets, (d) any other taxes and/or assessments affecting the Company, the Property Companies or the Assets (other than income taxes or gross receipt taxes), (e) insurance premiums due and payable (or paid) with respect to the Company, the Property Companies or the Assets, (f) license and/or permit fees that are either due and payable or have been prepaid with respect to the Company or the Property Companies, (g) utility charges that are either due and payable or have been prepaid with respect to the Assets, the Company or the Property Companies, (h) the cost of any fuel oil on hand at the Properties, (i) amounts paid or payable under service, management, development or construction contracts entered into by the Company or the Property Companies, and (j) any accounts payable of the Company or the Property Companies outstanding as of the Option Closing Date.  
“Family Member” means, with respect to any specified natural person, (a) any parent, child, descendant or sibling of such natural person (including relationships resulting from adoption) or (b) the spouse of such natural person or of any person covered by clause (a).
“Fiscal Period” means (a) the period commencing on the Effective Date and ending on December 31, 2014, (b) any subsequent 12-month period commencing on January 1 and ending on December 31 and (c) any portion of the period described in clauses (a) and (b) of this sentence (i) for which the Company is required to allocate Profits, Losses and other items of Company income, gain, loss or deduction pursuant to Article VI and (ii) ending on the date of an adjustment to the Gross Asset Value pursuant to clause (b) of the definition of “Gross Asset Value”.
“Fiscal Year” means (a) the period commencing on the Effective Date and ending on December 31, 2014, (b) any subsequent 12-month period commencing on January 1 and ending on December 31 and (c) the period commencing on the immediately preceding January 1 and ending on the date on which all property of the Company is distributed to the Members pursuant to Article X.
“FMV Determination Date” has the meaning set forth in Section 3.8(e)(2).
“Funded Amount” has the meaning set forth in Section 2.2(d).
“Governmental Entity” means a court, arbitral tribunal, administrative agency or commission or other governmental or other regulatory authority or agency.
“Gross Asset Value” means, with respect to any asset, the asset’s adjusted basis for federal income tax purposes, except as follows:
(a)    the initial Gross Asset Value of any asset contributed by a Member to the Company shall be the fair market value of such asset at the time it is accepted by the Company, unreduced by any liability secured by such asset, as reasonably determined by the Managing Member;
(b)    the Gross Asset Values of all Assets shall be adjusted to equal their respective fair market values, unreduced by any liabilities secured by such assets, as reasonably determined by the Managing Member as of the following times:  (i) the acquisition of an additional interest in the Company by any new or existing Member in exchange for more than a de minimis Capital Contribution; (ii) the distribution by the Company to a Member of more than a de minimis amount of property as consideration for an interest in the Company; (iii) the grant of more than a de minimis interest in the Company as consideration for the provision of services to or for the benefit of the Company by an existing Member acting in a partner capacity or by a new Member acting in a partner capacity or in anticipation of being a partner; and (iv) the liquidation of the Company within the meaning of Regulations Section 1.704-1(b)(2)(ii)(g); provided, however, that (x) an adjustment described in clauses (i), (ii) or (iii) of this paragraph shall be made only if the Managing Member reasonably determines that such an adjustment is necessary to reflect the relative economic interests of the Members and (y) the Managing Member shall have adjusted the Gross Asset Values of all Assets to equal their respective fair market values immediately following the Mergers (as defined in the Purchase and Sale Agreement) and immediately prior to the distribution of the Specified Hotel Interests (as defined in the Purchase and Sale Agreement) pursuant to Section 2(a)(ii) of the Purchase and Sale Agreement and for purposes of that revaluation the Managing Member shall treat the Assets as having an aggregate fair market value equal to the Grossed-Up Purchase Price (as defined in the Purchase and Sale Agreement).
(c)    the Gross Asset Value of any Asset distributed to any Member shall be adjusted to equal the fair market value of such asset on the date of distribution, unreduced by any liability secured by such asset, as reasonably determined by the Managing Member; and
(d)    the Gross Asset Value of all Assets shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such assets pursuant to Code Section 734(b) or Code Section 743(b), but only to the extent that such adjustments are taken into account in determining Capital Accounts pursuant to Regulations Section 1.704-1(b)(2)(iv)(m) and paragraph (f) of the definition of “Profits” and “Losses” or Section 8.2(g); provided, however, that Gross Asset Value shall not be adjusted pursuant to this paragraph (d) to the extent that an adjustment pursuant to paragraph (b) is required in connection with a transaction that would otherwise result in an adjustment pursuant to this paragraph (d).
If  the Gross Asset Value of an asset has been determined or adjusted pursuant to paragraphs (a), (b) or (d) of this definition, such Gross Asset Value shall thereafter be adjusted by the Depreciation taken into account with respect to such asset for purposes of computing Profits and Losses.
“Hazardous Substance” means any material, substance or waste as to which liability or standards of conduct may be imposed pursuant to any Environmental Laws.
“Hotel Management Agreement” means, collectively, those certain Hotel Management Agreements, dated as of the Effective Date, by and between Island Hospitality Management and each Property Leaseco.
“Hotel Manager” has the meaning set forth in the definition of Major Decision.
“Immediate Family Member” includes the parents, siblings, spouse, children, and spouse’s parents and siblings, of a Senior Foreign Political Figure.
“Indemnifiable Losses” has the meaning set forth in Section 11.1.
“Indemnified Person” has the meaning set forth in Section 11.1.
“Initiating Party” has the meaning set forth in Section 3.8(c)(ii).
“Initiating Party Fair Market Value” has the meaning set forth in Section 3.8(c)(ii).
“Ink III” means INK Acquisition III LLC, a Delaware limited liability company.
“Ink III Available Cash” means “Available Cash” as defined in the Ink III LLC Agreement.
“Ink III Capital Contributions” means “Capital Contributions” as defined in the Ink III LLC Agreement.
“Ink III Effective Date Deemed Capital Contributions” means “Effective Date Deemed Capital Contributions” as defined in the Ink III LLC Agreement.
“Ink III LLC Agreement” means the Limited Liability Company Agreement of INK Acquisition III LLC, effective as of the Effective Date, as may be amended in accordance therewith.
“Internal Rate of Return” means the annual percentage rate, compounded monthly, which, when utilized to calculate the present value of the aggregate amount of all actual distributions of Available Cash to NS Managing Member hereunder and Ink III Available Cash to NS Ink III Managing Member when made, causes such present value of such aggregate distributions to equal the present value of the sum of NS Managing Members’ aggregate Capital Contributions to the Company and NS Ink III Managing Member’s aggregate Ink III Capital Contributions to Ink III.  The present value of NS Managing Member’s Effective Date Deemed Capital Contribution to the Company is the nominal amount thereof and the present value of NS Managing Member’s additional Capital Contributions to the Company (other than Effective Date Deemed Capital Contributions) is the nominal amount of such additional Capital Contribution discounted back from the date such Capital Contribution was made utilizing said annual percentage rate.  The present value of NS Ink III Managing Member’s Ink III Effective Date Deemed Capital Contribution is the nominal amount thereof and the present value of NS Ink III Managing Member’s additional Ink III Capital Contributions to Ink III (other than Ink III Effective Date Deemed Capital Contributions) is the nominal amount of such additional Ink III Capital Contribution discounted back from the date such Ink III Capital Contribution was made utilizing said annual percentage rate.  All equity contributions and distributions will be assumed to have occurred on the first day of the month in which they were made and all present values shall be calculated as if discounted back to the date of the first day of the month in which each of the Effective Date Deemed Capital Contribution and Ink III Effective Date Deemed Capital Contribution was made.  In the case that there are multiple capital events within a given calendar month, the amounts of the capital events will be summed as if they had occurred simultaneously on the 15th day of that calendar month.  For all relevant purposes of this definition “Internal Rate of Return” shall be calculated by NS Managing Member using the Microsoft Excel XIRR function (or if such function is no longer available, such other software program for calculating internal rate of return as shall have been reasonably determined by NS Managing Member which approximates Microsoft Excel XIRR as close as reasonably possible).   
“Involuntary Bankruptcy” has the meaning set forth in the definition of Bankruptcy.
“IPO Entity” has the meaning set forth in Section 3.2(g)(vii).
“IRS” means the U.S. Internal Revenue Service, or any successor government agency.
“Island Hospitality Management” means Island Hospitality Management, Inc. or one of its Affiliates.
“JPM Loan” means collectively, (i) that certain mortgage loan, in the original principal amount of $635,000,000, made on the Effective Date, by Current Lender, as lender, to certain Property Companies, as borrower, (ii) that certain mezzanine loan, in the original principal amount of $130,000,000, made on the Effective Date, by Current Lender, as lender, to certain Property Companies, as borrower and (iii) that certain mezzanine loan, in the original principal amount of $75,000,000, made on the Effective Date, by Current Lender, as lender, to certain Property Companies, as borrower.
“Lender” means the lender under any Loan Documents to be executed with respect to a Loan, including, without limitation, Current Lender.
“Loan” means a loan obtained or assumed by the Company or any of its Subsidiaries, as borrower, secured by all or any portion of the Property or by equity interests of any Subsidiary of the Company, including, without limitation, the JPM Loan.
“Loan Documents” means any and all loan documents to be executed by the Company or any of its Subsidiaries, as applicable, and the Lender in connection with a Loan.
“Major Decision” means any determination to cause the Company or any Subsidiary of the Company to:
(a)    directly or indirectly acquire, or execute and deliver any documents, agreements or instruments necessary to close on the direct or indirect acquisition by the Company or any Subsidiary of the Company of, any Property, except as set forth in the then-approved Operating Budget or the then-approved Business Plan; 
(b)    (A) sell, assign, transfer, encumber or dispose of the Company, any Property Company, any Property, or any revenue-generating business of the Company or any Property Company, or agree to any of the foregoing, or (B) except as expressly provided in this Agreement or in the then-approved Operating Budget or the then-approved Business Plan, improve, design, rehabilitate, alter, or repair (collectively, the “Repairs”) of any of the Properties, provided, however, that the Managing Member may make or caused to be made Repairs not contemplated by the then-approved Operating Budget if (i) any such Repair is required by any franchisor under the applicable franchise agreement or any other agreement with the franchisor, (ii) emergency action or expenditures is necessary to prevent imminent risk to the health and safety of Persons on or about the Properties, imminent material property damage or imminent imposition of criminal or civil sanctions against the Company or any Member (each, an “Emergency Expenditure”), provided that (1) any such Emergency Expenditure made without approval of all the Members is, in the Managing Member’s commercially reasonable judgment, reasonable and necessary under the circumstances set forth above and (2) the Managing Member endeavors diligently and in good faith (x) to notify the Members of any such Emergency Expenditure promptly in writing and (y) attempts to obtain verbal approval of the Members for any required Emergency Expenditure, or (iii) if the aggregate cost of such Repairs fall within the thresholds set forth in clause (l) of this definition;
(c)    except as otherwise expressly permitted by this Agreement, call for Capital Contributions, approve Capital Calls or determine the portion of the then-approved Operating Budget that is to be funded by equity and by debt, or raise any new equity for any Subsidiary of the Company or admit any new member, partner or owner to the Company or any of its Subsidiaries;
(d)    make any operating expenditure or incur any operating obligation by or on behalf of the Company that varies materially from the then-approved Operating Budget other than an Emergency Expenditure made pursuant to the procedures set forth in clause (b) of this definition and expenditures that fall within the thresholds set forth in clause (l) of this definition; 
(e)    execute or modify, amend, supplement, terminate, extend or renew leases with tenants for occupancy of space in any Property or ground leases affecting any Property (or grant any consents or exercise remedies thereunder), except to the extent delegated to the Hotel Manager pursuant to the Hotel Management Agreements or set forth in the then-approved Operating Budget or the then-approved Business Plan;
(f)    enter into, modify or terminate any contractual arrangements with service providers (including lenders, attorneys, consultants, appraisers, third party property managers, brokerage companies, general contractors, accountants, auditors, architects, banks or other depositaries and all other service providers) for services to be rendered in connection with the business of the Company; provided, however, that (i) until further written notice, NS Managing Member hereby delegates the tasks set forth in this subsection (f) to the Managing Member, so long as all such services are expressly provided for and are not in excess of the amounts budgeted for such services in the then-approved Operating Budget and Business Plan and either (x) are terminable, without cause or fee, upon not more than thirty (30) days’ notice, (y) have a stated term of not more than one year, or (z) are expressly approved in writing by NS Managing Member, (ii) NS Managing Member hereby authorizes the Managing Member to cause the Property Leasecos to engage Island Hospitality Management to act as the hotel manager of all of the Properties on behalf of the Property Leasecos (the “Hotel Manager”) pursuant to the Hotel Management Agreements and (iii) the entry into, modification or termination of any contractual arrangement that requires an annual payment by the Company of $25,000 or less, or the determination to take any of the foregoing actions, shall not be considered a Major Decision;
(g)    incur or pay any real estate taxes, insurance premiums, or any assessments or charges with respect to the ownership and operation of any Property, except to the extent provided for in the then-approved Operating Budget or delegated to the Hotel Manager pursuant to the Hotel Management Agreement;
(h)    make distributions to the Members other than as set forth in Article VII of this Agreement;
(i)    establish reserves, determine reserve levels or make any distributions from any such reserves, except as set forth in the then-approved Operating Budget or the then-approved Business Plan;
(j)    except as set forth in the then-approved Operating Budget or the then-approved Business Plan, cause or permit the Company to finance all or any portion of any Property (other than the JPM Loan and trade debt incurred in the ordinary course of business consistent with the then-approved Operating Budget), agree to the form, substance, provider or documentation pertaining to any Loan, modify, restructure or terminate any Loan or repay any Loan except in accordance with the express terms of the applicable Loan, or enter into, modify or amend any documents, agreements or instruments relating to any Loan; 
(k)    except to the extent expressly set forth in the then-approved Operating Budget or the then-approved Business Plan, select or determine any insurance plans, carriers or coverages to be purchased and maintained by or on behalf of the Company or any Property Company;
(l)    taking into account amounts spent under clause (l) of the definition of Major Decision in the Ink III LLC Agreement, make any expenditures which are at variance with the then-approved Operating Budget or Business Plan (A) (1) with respect to any Operating Expense (as defined in the applicable Hotel Management Agreement) for any Property unless Operating Expenses for such Property would not exceed the estimated Operating Expenses for such Property as set forth in the then-current and approved Operating Budget with respect to such Property by five percent (5%) or more (in the aggregate, but not by line item) and (2) with respect to any other expenditure not described in clause (1), unless the variance in question does not exceed a particular summary line item by the lesser of (x) $50,000 or (y) 10% of that summary line item, and (B) unless the overall Operating Budget for the Company and Ink III is not exceeded in the aggregate by more than 2.5% (excluding, for purposes of the foregoing calculation, the use of any contingency line items set forth in the then-approved Operating Budget)), and provided that in any case the Managing Member may make an Emergency Expenditure pursuant to the procedures set forth in clause (b) of this definition);
(m)    grant or convey any easement, lien, ground lease, mortgage, deed, deed of trust, bill of sale, contract or other instrument purporting to convey or encumber any Property, either wholly or in part; 
(n)    take any Bankruptcy action on behalf of the Company or any of its Subsidiaries; 
(o)    institute any legal or arbitration proceedings in the name of the Company, settle any legal or arbitration proceedings against the Company or confess any judgment against the Company or any Property, other than (i) the institution of an eviction action, a suit for breach of a tenant lease or other similar proceeding contemplated in or provided for in the then-approved Operating Budget or the then-approved Business Plan or (ii) settlements or compromises for litigation or arbitration providing solely for the payment of money damages where the amount paid (after giving effect to any insurance proceeds) in settlement or compromise does not exceed $50,000; 
(p)    execute, deliver or file any agreement, permit, request, application or filing with any governmental agency, any neighboring property owner, any community organization or any similar regulatory body, or send any correspondence to or have any other material communications with, any governmental agency, which directly binds the Company or any of its Affiliates or any Member or any of its Affiliates, or which advocates a position on behalf of the Company or its Affiliates or any Member or its Affiliate (excluding correspondence, communications and other actions with respect to ministerial matters consistent with the then-approved Operating Budget and the then-approved Business Plan);
(q)    approve any investment other than as contemplated by this Agreement or approve any renovation or disposition of any Property, except as expressly authorized by the then-approved Business Plan and other than an Emergency Expenditure or Repair made pursuant to the procedures set forth in clause (b) of this definition; 
(r)    enter into any exclusivity, competition or confidentiality agreement that is or purports to be binding upon any Member or any of its Affiliates or interest holders;
(s)    enter into any settlements with any third party or any consent decree, order (judicial or otherwise) with any Governmental Entity, related to the breach of any Environmental Law, or the sampling, monitoring, treatment, remediation, removal or clean up of Hazardous Substances with respect to the Properties;
(t)    knowingly take or approve, or refrain from taking or approving, any action that is reasonably likely to lead to a default under any Loan Documents or to a material dispute with any Lender;
(u)    knowingly take or approve, or refrain from taking or approving, any action that could trigger a recourse provision under any then-outstanding Loan;
(v)    approve any marketing plans or agreements with respect to any Property, except as expressly authorized by the then-approved Business Plan;
(w)    require or permit the Company to make any loan to any Member or any of its Affiliates, or require or permit any loan to be made by any Member to the Company; 
(x)    cause the Company or any Property Company to execute or deliver any indemnity or guaranty;
(y)    change the Company’s depreciation and accounting methods and make other decisions with respect to the treatment of various transactions for federal income tax purposes, and change the Company’s elections for federal, state or local income tax purposes, provided, however, that NS Managing Member’s ability, as Tax Matters Member, to cause the Company to make an election under Section 754 of the Code with respect to the Company’s taxable year that will end on the Closing Date in accordance with Treasury Regulations section 1.708-1(b)(3)(ii) as a result of a “technical termination” of the Company as a partnership under Section 708(b)(1)(B) of the Code and Treasury Regulations section 1.708-1, shall not constitute a Major Decision;
(z)    amend this Agreement (or the corresponding organizational documents of any Subsidiary of the Company) in any respect;
(aa)    take or approve any action relating to any tax certiorari proceeding or other tax appeal affecting any Property;
(bb)    recapitalize, reclassify, redeem, repurchase or otherwise acquire any equity or other interests of the Company or any Subsidiary of the Company; 
(cc)    merge, consolidate or dissolve the Company or any of its Subsidiaries; 
(dd)    remove and replace Island Hospitality Management as Hotel Manager;
(ee)    permit or cause any Transfer that may reasonably be expected to cause the assets of the Company or any Subsidiary of the Company to be deemed “plan assets” (within the meaning of 29 C.F.R. 2510.3-101, as modified by Section 3(42) of ERISA);
(ff)    enter into any swap, hedge, collar or other interest rate protection agreement; 
(gg)    enter into any lease, whether as lessor or lessee, other than short term storage leases in connection with a capital program or equipment leases in the ordinary course of business;
(hh)    take any action that could reasonably be expected to cause the Company to fail to satisfy the gross income and asset tests applicable to REITs under Code Section 856(c)(1)-(4), assuming for this purpose that the Company were a REIT;
(ii)    enter in any transaction that could reasonably be expected to cause Chatham REIT or NS REIT to incur a liability for the tax on “prohibited transactions” under Code Section 857(b)(6);
(jj)    cause any rebranding of properties or entry into new franchise agreements or amend, supplement, terminate, extend or renew any franchise agreements (or grant any material consents or exercise material remedies thereunder);
(kk)    approve or implement any Operating Budget or Business Plan, as set forth in Section 3.5;
(ll)    except as otherwise expressly permitted pursuant to this Agreement or the then-current Operating Budget or Business Plan, entering into, amending or modifying agreements if such action would result in the Company, Ink III or their respective Subsidiaries being required to make expenditures not permitted by clause (l);
(mm)    entering into any agreement with an Affiliate of a Member other than pursuant to Section 4.4;
(nn)    causing the Company or any Subsidiary other than a Property Company or Property Leaseco to hold any assets other than (x) the interests in its Subsidiaries as of the Effective Date, (y) any cash reserves intended for distributions to the Members or to pay Company expenses or (z) any other assets that the Managing Member is permitted to acquire and hold pursuant to the then-effective Operating Budget;
(oo)    entering into or terminating, disposing of or materially amending the terms of any joint venture to which the Company or any of its Subsidiaries is a party;
(pp)    changing the principal banking institutions with which the Company or its subsidiaries maintain deposit, borrowing or other relationships; 
(qq)    causing the Company or any Property Company to employ any Person (it being acknowledged that neither the Company nor any Property Company shall have any employees);
(rr)    materially changing the line(s) of business of the Company and its Subsidiaries or conducting business in a jurisdiction other than the United States; or
(ss)    the disposition of any casualty insurance proceeds and the application of any condemnation award, including the settlement of any casualty insurance proceeds with an insurance company or the settlement of any condemnation award with any condemning authority on behalf of the Company or any of the Property Companies.
“Managing Member” means Chatham Managing Member, in its capacity as Managing Member of the Company, and any successor thereto appointed in accordance with this Agreement.
“Member” has the meaning set forth in the Preamble.
“Member Representatives” has the meaning set forth in Section 12.12. 
“Monthly Expense Amount” has the meaning set forth in Section 3.1(c)(i).
“Necessary Capital” means any capital that is not Non-Discretionary Capital that is needed from time to time by the Company or any Property Company for Company or Property Company purposes.  
“Nonrecourse  Built-in  Gain”  shall  mean  the  amount  of  taxable  gain  that  would  be allocated to a Member under Section 704(c) of the Code (or in the same manner as Section 704(c) of the Code in connection with a revaluation of Company property) if the Company disposed of (in a taxable transaction) all Company property subject to one or more Nonrecourse Liabilities of the Company in full satisfaction of the liabilities and for no other consideration.
“Nonrecourse Deductions” shall have the meaning set forth in Treasury Regulations Section 1.704-2(b)(1), and the amount of Nonrecourse Deductions for a Fiscal Year shall be determined in accordance with the rules of Treasury Regulations Section 1.704-2(c).
“Nonrecourse Liability” shall have the meaning set forth in Treasury Regulations Section 1.752-1(a)(2).
“Non-Contributing Member” has the meaning set forth in Section 2.2(d).
“Non-Discretionary Capital” means (x) payments required to be made by the Company or any Property Company to (a) avoid or minimize the imminent threat of either (i) loss or impairment of life or of personal injury or (ii) damage to any Asset of the Company or a Property Company or (b) make any repairs or capital improvements or take other action immediately required in order to avoid a violation of any laws, orders, rules, regulations and other requirements enacted, imposed or enforced by any governmental authority or (y) any Capital Contributions that are expressly contemplated by the approved Operating Budget or the then-approved Business Plan.
“Non-Proposing Member” has the meaning set forth in Section 3.7(a). 
“Non-Proposing Member’s Deposit” has the meaning set forth in Section 3.7(b). 
“Notice Recipient” has the meaning set forth in Section 3.8(c)(ii).
“Notice Response” has the meaning set forth in Section 3.8(c)(ii).
“NRFC” means NorthStar Realty Finance Corp., a Maryland corporation, or any entity that succeeds to all or substantially all of the assets and liabilities thereof pursuant to a Permitted Corporate Transaction.
“NRFC Sub-REIT” means NRFC Sub-REIT Corp., a Maryland corporation, or any entity that succeeds to all or substantially all of the assets and liabilities thereof pursuant to a Permitted Corporate Transaction.
“NS” means (a) NRFC, (b) NRFC Sub-REIT, (c) NorthStar Realty Finance Limited Partnership, a Delaware limited partnership, or any entity that succeeds to all or substantially all of the assets and liabilities thereof pursuant to a Permitted Corporate Transaction, or (d) NSAM.
“NSAM” means NorthStar Asset Management Group, Inc., a Delaware corporation, or any entity that succeeds to all or substantially all of the assets and liabilities thereof pursuant to a Permitted Corporate Transaction.
“NS Competitor” means (a) a Person that is then in a pending material litigation filed in court with NS or any Affiliate of NS that has been disclosed by NS or its Affiliate entity in public filings with the Securities and Exchange Commission (other than (1) litigation in connection with the applicable Parent Change in Control with respect to Chatham REIT and (2) litigation involving individuals who are directors or officers of NS unrelated to their capacity as such); or (b) any Person (other than a hotel REIT or Person for whom the Chatham Principal serves as chief executive officer) that (i) is engaged in the business of lending on or owning commercial real estate in the United States and (ii) (A) owns total gross assets in excess of $1,000,000,000 or (B) has total assets (in name or under management) in excess of $1,000,000,000.  
“NS Guarantor” has the meaning set forth in Section 1.11(c).
“NS Ink III Managing Member” means Platform Member Holdings-T CAM2, LLC.
“NS Managing Member” has the meaning set forth in the Preamble.
“NS Managing Member Effective Date Deemed Capital Contribution” has the meaning set forth in Section 2.2(a).
“NS Operating Company Managing Members” means, collectively, NS Managing Member and NS Ink III Managing Member.
“NS Parent” means NRFC or, if NSAM Controls the NS Managing Member, NSAM. 
“NS REIT” means NRFC Sub-REIT or NRFC.
 “OFAC” means the U.S. Department of the Treasury’s Office of Foreign Assets Control.
“OFAC Sanctions Programs” means any countries, territories, individuals or entities that are prohibited pursuant to the laws, regulations or Executive Orders administered by OFAC, including the List of Specially Designated Nationals and Blocked Persons administered by OFAC, as such list may be amended from time to time.
“Officer” means any officer of the Company or any Subsidiary thereof appointed in accordance with this Agreement or by the manager of such Subsidiary.
“Operating Budget” means the annual operating budget for the ownership, operation, leasing, marketing and sale of the Properties and Assets, as applicable, and any liabilities or obligations of the Company and Ink III, as in effect from time to time pursuant to Section 3.5 hereof and in the Ink III LLC Agreement (it being acknowledged and agreed that (i) the Operating Budget shall initially be based on the Final Operating Budget (as such term is defined in the Hotel Management Agreements) and shall then incorporate any additional costs and expenses of the Company and Ink III not included in the Final Operating Budget (including, without limitation, costs of any Chatham Company Personnel) and (ii) the Operating Budget shall have a line item reimbursing NS Managing Member and the NS Ink III Managing Member, as applicable, for any third party consultant retained by NS Managing Member and the NS Ink III Managing Member, as applicable, to oversee the activities and operation of the Company, Ink III, the Assets, and the Properties, as applicable, which expenses shall not exceed Three Hundred Thousand Dollars ($300,000) per Fiscal Year in the aggregate under this Agreement and the Ink III LLC Agreement).
“Option Closing” has the meaning set forth in Section 3.8(e)(i). 

“Option Closing Date” has the meaning set forth in Section 3.8(e)(i). 

“Option Closing Period” has the meaning set forth in Section 3.8(e)(ii). 

“Option Interests” has the meaning set forth in Section 3.8(a). 
“Option Notice” has the meaning set forth in Section 3.8(b).

“Option Price” has the meaning set forth in Section 3.8(c)(i).
“P&L Statement” has the meaning set forth in Section 4.2(a).
“Parent Change in Control” means, as of any date, with respect to NS Parent or Chatham REIT, as applicable:

(a)    any merger, consolidation or similar business combination of NS Parent or Chatham REIT, as applicable, into or with another Person as a result of which holders of the voting securities of NS Parent or Chatham REIT, as applicable, immediately prior to the consummation of the transaction hold, directly or indirectly, immediately following the consummation of the transaction, equity interests in the surviving entity in such transaction or its ultimate parent possessing less than a majority of the voting power of such surviving entity or ultimate parent; or
(b)    any other transaction (other than a merger, consolidation or similar business combination, which is addressed by clause (a)), including the sale by NS Parent or Chatham REIT, as applicable, of new equity interests or a transfer of existing equity interests of NS Parent or Chatham REIT, as applicable,, the result of which is that any other Person or group of related Persons, directly or indirectly, acquires (i) beneficial ownership (as defined under Section 13(d) of the Exchange Act) of equity interests of NS Parent or Chatham REIT, as applicable, representing a majority of NS Parent’s or Chatham REIT’s, as applicable, voting power or (ii) a majority of the assets of NS Parent or Chatham REIT, as applicable.
“Partnership Minimum Gain” shall have the meaning set forth in Treasury Regulations Section 1.704-2(b)(2), and the amount of Partnership Minimum Gain, as well as any net increase or net decrease in Partnership Minimum Gain for a Fiscal Year shall be determined in accordance with the rules of Treasury Regulations Section 1.704-2(d).
“Percentage Interest” means, with respect to any Member, such Member’s ownership interest in the Company, calculated as the percentage obtained by dividing the Capital Contributions of such Member by the aggregate Capital Contributions of all the Members. As of the Effective Date, the Percentages Interests of the Members are set forth on Schedule A.
“Permitted Corporate Transaction” means any of the following:  (i) a direct or indirect Transfer of the stock or other equity interests in a Covered Entity, (ii) the direct or indirect creation of new stock (including separate classes of stock) or other equity interests in a Covered Entity, (iii) direct or indirect stock splits or reverse stock splits in a Covered Entity, (iv) redemption of stock or equity interests by a Covered Entity, (iv) the conversion of a Covered Entity that is a REIT from a public to a private company or vice versa, (v) the conversion of a Covered Entity that is a public company to a private company or vice versa, (vi) any reorganization, merger, consolidation, recapitalization, restructuring or similar transaction with respect to a Covered Entity, (vii) the spin-off or formation of a company or entity that has as its direct or indirect majority owners any Covered Entity or shareholders of a Covered Entity, or Affiliates of any of the foregoing; and (viii) any other transaction that modifies, changes, or affects the ownership or control of a Covered Entity or all or substantially all of the assets of a Covered Entity.
“Permitted Transfer” means the sale, transfer or encumbrance of the stock, partnership interest or limited liability company interest in a Member or any corporation, partnership, trust, limited liability company or other entity that directly or indirectly holds an interest in a Member, provided that such sale, transfer or encumbrance does not constitute a Change in Control (it being acknowledged and agreed (x) that a Member may from time to time consist of one or more members, partners, managers and other persons that may contribute funds or loan funds to a Member to be used in connection with the obligations of a Member under this Agreement, provided that if such contribution or loan does not constitute a Permitted Corporate Transaction then the foregoing shall only be permitted if it does not result in a Change in Control, (y) any such sale, transfer or encumbrance that does constitute an Change in Control shall require the consent of the other Member and (z) notwithstanding anything to the contrary in the foregoing clauses (x) or (y) or elsewhere in this Agreement, a Permitted Corporate Transaction shall be deemed a Permitted Transfer). 
“Person” means any individual, corporation, association, partnership (general or limited), joint venture, trust, joint-stock company, estate, limited liability company, Series, unincorporated organization or other legal entity or organization.
“Portfolio Sale Blackout Period” means any period commencing on the date when NS Managing Member delivers to Chatham Managing Member notice (a “Portfolio Sale Notice”) of its good faith intention to sell all or substantially all of the Properties and ending six (6) months following such date, unless NS Managing Member enters into a purchase agreement for such sale during such six-month period, in which case such period shall end nine (9) months following the date such Portfolio Sale Notice is delivered; provided, that if NS Managing Member delivers a Buy/Sell Notice to Chatham Managing Member during any Portfolio Sale Blackout Period, then such Portfolio Sale Blackout Period shall end on the date of such delivery; provided, further, that NS Managing Member shall not be permitted to deliver a subsequent Portfolio Sale Notice until six (6) months after the end of a Portfolio Sale Blackout Period.
“Post-Termination Major Decision” means any determination to cause the Company or any Subsidiary of the Company to take any action described in clauses (h), (r), (z), (bb), (hh) or (ii) of the definition of “Major Decisions”.
“President and CEO” has the meaning set forth in Section 3.4(d)(i).
“Priming Capital Contribution” has the meaning set forth in Section 2.2(d).
“Priming Capital Contribution Return” means with respect to each Priming Capital Contribution and as of the date of calculation, an amount equal to (x) the accrued and unpaid per annum interest at twenty percent (20%) on Priming Capital Contributions made by a Contributing Member in connection with Capital Calls for Necessary Capital and (y) the accrued and unpaid per annum interest at fifteen percent (15%) on Priming Capital Contributions made by a Contributing Member in connection with Capital Calls for Additional Capital Contributions other than for Necessary Capital, which accrued and unpaid interest, in either instance, shall (i) commence accruing as of the date of funding of the applicable Priming Capital Contribution, (ii) compound monthly, to the extent not paid from distributions of Available Cash from Operations under Section 7.1(a)(i) or Available Cash from Capital Event under Section 7.1(b)(i) (as applicable), and (iii) be calculated on the basis of a 360-day year composed of twelve (12) months of thirty (30) days each, except that the interest payable in respect of any period less than a full calendar month shall be calculated by multiplying the actual number of days elapsed in such period by a daily rate based on a 360-day year.
“Prior Agreement” has the meaning set forth in the Recitals.
“Profits” or “Losses” means for each Fiscal Period, an amount equal to the taxable income or loss for such Fiscal Period.  Such amount shall be determined in accordance with Code Section 703(a) (for this purpose, all items of income, gain, loss, or deduction required to be stated separately pursuant to Code Section 703(a)(1) shall be included in taxable income or loss), with the following adjustments (without duplication):
(a)    any income that is exempt from federal income tax and not otherwise taken into account in computing Profits or Losses pursuant to this definition shall be added to such taxable income or loss;
(b)    any expenditures described in Code Section 705(a)(2)(B) or treated as Code Section 705(a)(2)(B) expenditures pursuant to Regulations Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account in computing Profits or Losses pursuant to this definition shall be subtracted from such taxable income or loss;
(c)    in the event the Gross Asset Value of any Asset is adjusted pursuant to paragraphs (b) or (c) of the definition of Gross Asset Value, the amount of such adjustment shall be taken into account as an item of gain (if the adjustment increases the Gross Asset Value of the asset) or an item of loss (if the adjustment decreases the Gross Asset Value of the asset) from the disposition of such asset and shall be taken into account for purposes of computing Profits or Losses;
(d)    gain or loss resulting from any disposition of property with respect to which gain or loss is recognized for federal income tax purposes shall be computed by reference to the Gross Asset Value of property disposed of, notwithstanding that the adjusted tax basis of such property differs from its Gross Asset Value;
(e)    in lieu of depreciation, amortization, and other cost recovery deductions taken into account in computing such taxable income or loss there shall be taken into account Depreciation for such Fiscal Period, computed in accordance with the definition of Depreciation; and
(f)    to the extent an adjustment to the adjusted tax basis of any Asset pursuant to Code Section 734(b) or 743(b) is required pursuant to Regulations Section 1.704-1(b)(2)(iv)(m) to be taken into account in determining Capital Accounts as a result of a distribution other than in liquidation of a Member’s interest in the Company, the amount of such adjustment shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases the basis of the asset) from the disposition of the asset and shall be taken into account for purposes of computing Profits or Losses.
“Promote” means any right of the Chatham Managing Member to receive distributions of Available Cash under Section 7.1(b)(iii)(A), Section 7.1(b)(iv)(A) and Section 7.1(b)(v)(A). 
“Promote Forfeiture Event” means any event under clauses (b)(i) (provided that the applicable breach is a Willful Breach), (b)(ii), (e), (g) (but solely if the event constituting a Termination Event (as defined in the Ink III LLC Agreement) under the Ink III LLC Agreement was in respect of clauses (b)(i) (provided that the applicable breach is a Willful Breach), (b)(ii), (e), (i) or (j) of the definition of “Termination Event” under the Ink III LLC Agreement), (i) and (j) of the definition of “Termination Event”.  
“Promote Payment Loan” has the meaning set forth in Section 7.4(b).

“Properties” means the hotel properties listed on Schedule B hereto, and any other property (real, personal or mixed) or real estate acquired by the Company in accordance with this Agreement.
“Property Company” means a direct or indirect subsidiary of the Company through which the Company indirectly holds an ownership, leasehold or other interest in one or more Properties.  The Property Companies existing as of the Effective Date are set forth on Schedule B hereto.
“Property Leasecos” means each of Grand Prix Fixed Lessee, LLC and INK Lessee, LLC, each a Delaware limited liability company, that will be indirectly or directly owned by Ink III.
“Proposing Member” has the meaning set forth in Section 3.7(a). 
“Proposing Member’s Deposit” has the meaning set forth in Section 3.7(a). 
“Purchase and Sale Agreement” means that certain Purchase and Sale Agreement, dated as of May 8, 2014, by and among certain affiliates of Cerberus Real Estate Capital Management, LLC, as sellers, and the NewINK, LLC, as buyer, and the other parties thereto. 
“Purchasing Member” means either (a) the Proposing Member or any person, partnership, corporation, limited liability company or other entity designated by the Proposing Member, if the Non-Proposing Member elects (or is deemed to have elected) to sell pursuant to Section 3.7, it being acknowledged that there shall be no restrictions on the right of the Proposing Member (concurrently with the Buy/Sell Closing but not prior thereto) to assign or transfer its right to purchase the Non-Proposing Member’s membership interest in the Company (including, without limitation, a right to assign such rights to more than one entity), provided that no such transfer shall release the Proposing Member from its obligation to consummate the Buy/Sell Closing, shall delay the Buy/Sell Closing Date, shall decrease the amounts ultimately payable to the Non-Proposing Member or shall, in the Non-Proposing Member’s reasonable judgment, expose the Non-Proposing Member to any increased risk or liability (including, without limitation, income tax liability) in excess of that which it would have had in the event there were no such transfer or (b) the Non-Proposing Member or any person, partnership, corporation, limited liability company or other entity designated by the Non-Proposing Member, if the Non-Proposing Member elects to purchase pursuant to Section 3.7, it being acknowledged that there shall be no restrictions on the right of the Non-Proposing Member (concurrently with the Buy/Sell Closing but not prior thereto) to assign or transfer its right to purchase the Proposing Member’s membership interest in the Company (including, without limitation, a right to assign such rights to more than one entity), provided that no such transfer shall release the Non-Proposing Member from its obligation to consummate the Buy/Sell Closing or shall delay the Buy/Sell Closing Date.
“Put Notice” has the meaning set forth in Section 3.8(a). 
“Put Option” has the meaning set forth in Section 3.8(c)(i).
“Put Option Commencement Date” has the meaning set forth in Section 3.8(a).
 “QIB” means a “qualified institutional buyer” within the meaning of Rule 144A under the 1933 Act.
“Qualified IPO” shall mean an initial public underwritten (firm commitment) offering of equity securities of the Company or an IPO Entity; provided that (a) equity interests with associated Percentage Interests of not less than 10% in the aggregate are sold in the Qualified IPO, (b) the equity interests sold in the Qualified IPO are approved for listing on the New York Stock Exchange, Nasdaq or another US national securities exchange and (c) in the case of a Qualified IPO Demand made on or prior to the first anniversary of the date of this Agreement, the equity capitalization of the Company or IPO Entity, as applicable, based on the price of the equity interests to be sold in the Qualified IPO, is reasonably acceptable to Chatham Managing Member.
 “Regulations” means the federal income tax regulations promulgated by the Treasury Department under the Code, as such regulations may be amended from time to time.  All references herein to a specific section of the Regulations shall be deemed also to refer to any corresponding provisions of succeeding Regulations.
“REIT” means an entity that qualifies as a “real estate investment trust” under Code Sections 856 through 860.
“Representative” has the meaning set forth in Section 10.2. 
“Removal Notice” has the meaning set forth in Section 3.2(h).
“Response Notice” has the meaning set forth in Section 3.2(i).
“Selling Member” means the Member that elects (or is deemed to have elected) to sell pursuant to Section 3.7.

“Senior Foreign Political Figure” means (a) a current or former senior official in the executive, legislative, administrative, military or judicial branches of a non-U.S. government (whether elected or not), a current or former senior official of a major United States political party or a current or former senior executive of a non-U.S. commercial enterprise, (b) a corporation, business or other entity that has been formed by or for the benefit of a Senior Foreign Political Figure; (c) an immediate family member of a Senior Foreign Political Figure; and (d) a close associate of a Senior Foreign Political Figure.  For purposes of this definition, a “senior official or “senior executive” means an individual with substantial authority over policy, operations, or the use of government-owned resources. 
“Spin-Off Blackout Period” means any period commencing on the date when NS Managing Member delivers to Chatham Managing Member (a) notice of its good faith intention to effectuate a Permitted Corporate Transaction that is a spin-off described in clause (vii) of the definition thereof or (b) a Call Notice in respect of a spin-off pursuant to Section 3.8 (a notice described in clause (a) or a Call Notice, a “Spin-Off Notice”) and ending on the earliest of (i) twelve (12) months following such date, (ii) the consummation of such spin-off, (iii) the date when NS Managing Member notifies Chatham Managing Member that is not pursuing such spin-off, and (iv) the date NS Managing Member delivers a Buy/Sell Notice; provided, however, that NS Managing Member shall not be permitted to deliver a subsequent Spin-Off Notice until six (6) months after the end of a Spin-Off Blackout Period. 
“Subsidiary” of a Person means any corporation, partnership, limited liability company, trust and other entity, whether incorporated or unincorporated, with respect to which such Person, directly or indirectly, legally or beneficially, owns (i) a right to a majority of the profits of such entity; or (ii) securities having the power to elect a majority of the board of directors or similar body governing the affairs of such entity.
“Tax Matters Member” has the meaning set forth in Section 8.1.
“Termination Event” means (a) the occurrence of a Failed Contribution with respect to any Capital Contribution (other than an Effective Date Deemed Capital Contribution) for which a Capital Call has been made by Chatham Managing Member, (b)(i) any material breach of Chatham Managing Member’s obligations hereunder (other than a Failed Contribution) or (ii) any gross negligence, willful misconduct, misappropriation of funds or fraud, in each case committed by the Chatham Principal (so long as he is an Affiliate of Chatham Managing Member, it being understood that he is such an Affiliate as of the date hereof), Chatham Managing Member or any Affiliate of Chatham Managing Member in connection with the performance of Chatham Managing Member’s obligations hereunder, in each case other than such material breach, gross negligence, willful misconduct, misappropriation of funds or fraud that, if capable of being Cured, is Cured within thirty (30) days after Chatham Managing Member receives written notice thereof; provided, however, (i) if such misappropriation of funds or fraud is committed knowingly by the Chatham Principal then the Chatham Managing Member shall not have an opportunity to Cure such misappropriation of funds or fraud and such misappropriation of funds or fraud shall immediately constitute a Termination Event and (ii) it shall not be a breach of Chatham Managing Member’s obligations hereunder if (x) Chatham Managing Member takes an action that would be a Major Decision as defined in clause (t) or (u) of the definition thereof that is approved by a Member other than the Managing Member to the extent such other Member is authorized to give such direction or (y) Chatham Managing Member refuses to take an action that would be a Major Decision as defined in clause (t) or (u) of the definition thereof as a result of an affirmative veto or lack of approval by a Member other than the Managing Member to the extent such other Member is authorized to give such veto or approval, (c) the reduction of Chatham Managing Member’s Percentage Interest to a percentage of less than 5% hereof, (d) the failure of the Chatham Principal to remain as active in the management and business of Chatham REIT as he is as of the date of this Agreement, (e) any direct or indirect Transfer of an interest in Chatham Managing Member that is not a Transfer permitted under Article V hereof, unless such Transfer, if capable of being Cured, is Cured within thirty (30) days after the occurrence thereof, (f) the failure of Chatham Managing Member to timely satisfy its binding obligation to sell as a selling Member or to purchase as a purchasing Member, as applicable, under and as set forth in Section 3.7 and Section 3.8 below, (g) the termination of the Chatham Ink III Member as managing member of Ink III as a result of a Termination Event (for purposes of this clause (g), as defined in the Ink III LLC Agreement), (h) Chatham Managing Member is subject to any Bankruptcy Action, (i) Chatham Managing Member or any Affiliate of Chatham Managing Member takes any improper action which results in a material default under a Loan, any franchise agreement affecting any of the Properties or any ground lease affecting any of the Properties, unless such default, if capable of being Cured, is Cured within thirty (30) days after the occurrence thereof, (j) Chatham Managing Member or any Affiliate of Chatham Managing Member breaches its obligations set forth in Section 12.17 of this Agreement or (k) there is a Change in Control with respect to Chatham Managing Member, or a Parent Change in Control with respect to Chatham REIT, that in either instance results in Chatham Managing Member being Controlled by a NS Competitor (unless, in the case of this clause (k), the Chatham Principal remains chief executive officer of Chatham REIT (or its successor pursuant to such Change of Control or Parent Change of Control) upon consummation of such Change of Control or Parent Change of Control). 
“Third Party Claim” has the meaning set forth in Section 11.6.
“Transaction Costs” means the transaction costs and expenses incurred by the Members or their Affiliates  in connection with the consummation of the transactions contemplated by the Purchase and Sale Agreement, including, without limitation (i) the purchase of the Cerberus Interests (but excluding the purchase price therefor), (ii) any transfer taxes and other closing costs in connection therewith that are borne by the “Purchaser” under the Purchase and Sale Agreement, (iii) the fees, costs and disbursements of counsel to the Members and the Company, including the fees and costs of Duval & Stachenfeld LLP as counsel to NS Managing Member, the fees and costs of Hunton & Williams LLP as tax counsel to NS Managing Member, the fees and costs of Wachtell, Lipton, Rosen & Katz, as counsel to Chatham Managing Member and the fees and costs of Hunton & Williams LLP as tax counsel to Chatham Managing Member, (iv) the establishment of any Working Capital Reserve upon the Effective Date in an amount reasonably determined by NS Managing Member, (v) the fees, costs and disbursements paid to Current Lender in connection with the repayment of the indebtedness owing thereto on the Effective Date that are borne by the “Purchaser” under the Purchase and Sale Agreement and (vi) other fees, costs and expenses (including due diligence costs, the costs of any environmental consultants and other expenses incurred by the Members or their Affiliates prior to the Effective Date) which are approved by both of the Members. 
“Transfer” means any direct or indirect sale, assignment, pledge, hypothecation or other transfer or encumbrance of an interest in any Member or any Member’s Interest in the Company, whether by operation of law or otherwise (including, without limitation, the withdrawal of any Person having any direct or indirect interest in any Member); provided that the sale or transfer of capital stock or other equity interests in Chatham REIT or any entity that succeeds to all or substantially all of the assets and liabilities thereof (whether by merger, consolidation or otherwise) shall not be considered a Transfer of any interests in Chatham REIT (or such successor) or its Affiliates, including Chatham Managing Member, provided further, without limiting the ability of NS to effectuate a Permitted Corporate Transaction, that the sale or transfer of capital stock or other equity interests in a publicly traded entity comprising part of NS shall not be considered a Transfer of any interests in NS or its Affiliates, including NS Managing Member.
“Treasury Regulations” means the federal income tax regulations promulgated by the Treasury Department under the Code, as such regulations may be amended from time to time.  All references herein to a specific section of the Treasury Regulations shall be deemed also to refer to any corresponding provisions of succeeding Treasury Regulations.
“TRS” means an entity that qualifies as a “taxable REIT subsidiary” under Code Section 856(l).
“Value Acceptance Notice” has the meaning set forth in Section 3.8(c)(iii).
“Value Dispute Notice” has the meaning set forth in Section 3.8(c)(iii).
“Value Negotiation Period” has the meaning set forth in Section 3.8(c)(v).
 “Voluntary Bankruptcy” has the meaning set forth in the definition of Bankruptcy.
“Voting Representative” has the meaning set forth in Section 10.2.
“Willful Breach” means an intentional and willful material breach of this Agreement or the Ink III LLC Agreement, as applicable, that is the consequence of an act or omission by a party with the actual knowledge that the taking of such act or failure to take such act would cause a breach of this Agreement or the Ink III LLC Agreement, applicable.
“Wind-Down Expenses” has the meaning set forth in Section 3.2(h).
“Working Capital Operating Reserve” means a reserve for the working capital and other needs of the Company and/or any Property Company.  The parties acknowledge that any Working Capital Sale Reserve that is established pursuant to the sale of the Assets shall be separate and apart from the Working Capital Operating Reserve and, without limitation of the foregoing, the funds determined to be placed in any such Working Capital Sale Reserve shall not, unless otherwise reasonably determined by NS Managing Member, reduce the funds that shall remain in the Working Capital Operating Reserve.  
“Working Capital Reserve” means, as the context requires, the Working Capital Operating Reserve or the Working Capital Sale Reserve, as applicable.  The parties acknowledge that the funds contributed by the Members on the Effective Date shall remain with the Company as the initial Working Capital Reserve to be disposed of in accordance with the then-approved Operating Budget or the then-approved Business Plan. 
“Working Capital Sale Reserve” means, with respect to the sale of an Asset, a reserve for the working capital and other needs of the Company and/or the applicable Property Company that pertains to the Asset that has been sold, in each case as is reasonably determined by NS Managing Member. 
Any capitalized term not defined herein shall have the meaning ascribed to such term in the Act.
Section 1.7    Certificates.  Each Officer of the Company is an authorized Person within the meaning of the Act to execute, deliver and file any certificates (and any amendments and/or restatements thereof) necessary for the Company to qualify to do business in a jurisdiction within the United States in which the Company may wish to conduct business.    
Section 1.8    Term.  The term of the Company shall begin on the date the Certificate of Formation was filed with the Secretary of State of the State of Delaware and shall continue until terminated in accordance with the provisions hereof or pursuant to the Act.
Section 1.9    [Reserved]
Section 1.10    Property Companies. The Managing Member shall perform, with no additional compensation, substantially identical services for each Property Company as the Managing Member performs for the Company, subject to the terms, conditions, limitations and restrictions set forth in this Agreement.  The Managing Member agrees to perform such duties, and, in such circumstances and with regard to such duties, the Managing Member shall be subject to the same standards of conduct and shall have the same rights and obligations with regard to such duties performed or to be performed on behalf of any such Property Company as are set forth in this Agreement with regard to substantially identical services to be performed for or on behalf of the Company.  Without limiting the generality of the foregoing, the Members agree to make such non-economic changes as any Lender(s) may require with respect to this Agreement and/or to the organizational documents of the Property Companies, including, without limitation, the addition of a non-member manager and/or independent director to the structure of any Property Company to the extent not already in place.  The Property Companies and the Properties are listed on Schedule B hereto and such Properties and Property Companies shall be subject to this Section 1.10.
Section 1.11    Liability of Members.
(a)    No Member shall have any duty to any other Member or to the Company beyond those specifically set forth in this Agreement, any Contribution Agreement and the Chatham Guaranty.
(b)    Except as otherwise expressly provided in the Act, the debts, obligations and liabilities of the Company, whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the Company, and no Member shall be obligated personally for any such debt, obligation or liability of the Company or of any other Member solely by reason of being a member of the Company.  Except as otherwise expressly provided in the Act or this Agreement, the liability of each Member to the Company shall be limited to the amount of Capital Contributions required to be made by such Member, from time to time, in accordance with the provisions of this Agreement.
(c)    Except as otherwise provided in this Agreement or under applicable laws or Regulations, the Members shall not be required to lend any funds to the Company or, after their respective Capital Contributions shall have been made, to make any further contributions to the Company or to repay to the Company, any Member or any creditor of the Company all or any portion of any negative amount in their respective Capital Accounts.  Subject to the terms of this Agreement, the Managing Member may, on behalf of the Company or any of its Subsidiaries, at any time and from time to time, apply for and secure one or more Loans, in such amounts, at such rates and on such other terms as are set forth in the then-applicable Operating Budget and then-applicable Business Plan or as may be agreed by the Members then permitted to approve Major Decisions.  The Company shall use commercially reasonable efforts to either obtain (or to cause its Subsidiaries to obtain)  such Loan(s) on a fully nonrecourse basis or to have such Loan(s) provide that any liability for customary non-recourse “carveouts” and for environmental liabilities will be limited to the Company and its assets (and/or one or more Subsidiaries thereof and its or their assets); provided, however, that if such efforts are unsuccessful, then the Chatham REIT or a Subsidiary of the Chatham REIT acceptable to Lender (such entity, the “Chatham Guarantor”), together with NS Managing Member or an Affiliate thereof acceptable to Lender (“NS Guarantor” and, together with Chatham Guarantor, the “Carveout Guarantors”), shall execute and deliver one or more Carveout Guarantees in forms reasonably acceptable to Lender and such  Carveout Guarantors, providing for recourse to such Carveout Guarantors in favor of the applicable Lender; provided, further, however, if the Lender requires one or more Carveout Guarantees, but does not require an NS Guarantor to execute and deliver any such Carveout Guarantee, then the Chatham Guarantor shall execute the Carveout Guarantees solely.
Notwithstanding anything to the contrary herein, neither Member shall have an obligation to enter into (or to cause any Affiliate thereof to enter into) any Carveout Guaranty unless and until the other Member (and, in the event that no NS Guarantor is executing such Carveout Guaranty, NRFC Sub-REIT) executes and delivers to such Person a contribution agreement in substantially the same form as the contribution agreement executed by the parties in connection with the JPM Loan, which form is attached hereto as Schedule D (each such agreement, a “Contribution Agreement”).   A breach by a party of a Contribution Agreement shall be deemed to be a breach by such party (or, if such party is not a Member, by any Affiliate thereof that is a Member) of this Agreement.  
ARTICLE I.     
 
PERCENTAGE INTERESTS, CAPITAL  
CONTRIBUTIONS AND CAPITAL ACCOUNTS
Section 1.12    Percentage Interests.  Each Member will receive a Percentage Interest in the Company for such Member’s Capital Contributions.
Section 1.13    Capital Contributions.
(a)    Effective Date Deemed Capital Contributions.  On the Effective Date:
(i)    NS Managing Member shall be deemed to make a capital contribution to the Company (the “NS Managing Member Effective Date Deemed Capital Contribution”) in an amount equal to $192,992,588.40; 
(ii)    Chatham Managing Member shall be deemed to make a capital contribution to the Company (the “Chatham Member Effective Date Deemed Capital Contribution”) in an amount equal to $22,107,563.40; and
(iii)    the Company shall reimburse the Members for the Transaction Costs incurred by them and their respective Affiliates.  
(b)    Additional Capital Contributions.  (i)  Subject to the terms and conditions of this Agreement, NS Managing Member (without obtaining prior approval from Chatham Managing Member) shall have the right to deliver a Capital Call for any Additional Capital Contribution that constitutes either (1) Non-Discretionary Capital or (2) Necessary Capital, provided in each case that such capital call is made in good faith (e.g., not for the purpose of seeking to dilute or subordinate the Chatham Managing Member's interests pursuant to Section 2.2(d)), (ii) Chatham Managing Member (without obtaining prior approval from NS Managing Member) shall have the right to deliver a Capital Call Notice for any Additional Capital Contribution that constitutes Non-Discretionary Capital, and (iii) both NS Managing Member and Chatham Managing Member shall have the right (after obtaining the prior approval of the other)  to deliver a Capital Call Notice for any Additional Capital Contribution other than those set forth in clauses (i) and (ii).  No capital contributions shall be permitted other than Additional Capital Contributions pursuant to the preceding sentence or Effective Date Deemed Capital Contributions, except with the consent of both NS Managing Member and Chatham Managing Member.
(c)    Payment of Capital Contributions.  Capital Contributions by the Members shall be made in U.S. dollars by wire transfer of federal funds to an account or accounts of the Company specified by the Company.  
(i)    Each Member shall be required to fund its pro rata share (in accordance with Percentage Interests) of any Additional Capital Contribution, except as provided in clause (ii).  
(ii)    If, as of the date any Capital Call is made, Chatham Managing Member has received distributions in respect of the Promote, (A) Chatham Managing Member shall be required to fund a percentage of the applicable Additional Capital Contribution equal to the highest percentage of a distribution of Available Cash From Capital Event that Chatham Managing Member would have been entitled to receive pursuant to Section 7.1(b) if the Promote were recalculated as of such date (a “Hypothetical Promote Calculation”), provided that the Hypothetical Promote Calculation and applicable percentage shall be further recalculated with each dollar of funds so contributed by Chatham Managing Member (e.g., by way of illustration only, if the Hypothetical Promote Calculation would have resulted in Chatham Managing Member receiving $250,000 pursuant to Section 7.1(b)(ii) at a level equal to its Percentage Interest, another $1,000,000 pursuant to Section 7.1(b)(iii) at a level equal to the Section 7.1(b)(iii) Aggregate Percentage and another $500,000 pursuant to Section 7.1(b)(iv) at level equal to the Section 7.1(b)(iv) Aggregate Percentage, Chatham Managing Member shall be required to fund the Section 7.1(b)(iv) Aggregate Percentage of the applicable Additional Capital Contribution until it has contributed $500,000, then the Section 7.1(b)(iii) Aggregate Percentage of any remaining portion of the applicable Capital Contribution until it has contributed $1,000,000, and then its pro rata share (in accordance with its Percentage Interest) of any remaining portion of the applicable Capital Contribution and (B) NS Managing Member shall be required to fund the portion of the Additional Capital Contribution not required to be funded by Chatham Managing Member pursuant to clause (A).  
(iii)    Notwithstanding the foregoing, NS Managing Member shall determine the Hypothetical Promote Calculation and deliver same to Chatham Managing Member in writing, setting out in reasonable detail the basis for such calculation.  Within ten (10) days of receipt of such notice, Chatham Managing Member shall either (x) agree to NS Managing Member’s determination of the Hypothetical Promote Calculation or (y) object to NS Managing Member’s determination of the Hypothetical Promote Calculation (and failure to respond shall be deemed an election under clause (x)).  In the event Chatham Managing Member elects pursuant to clause (y), (A) Chatham Managing Member shall describe the basis of such disagreement and such dispute shall be resolved by Expedited Arbitration pursuant to and in accordance with the Expedited Arbitration Procedures set forth in Schedule K attached hereto and (B)   the amount of Chatham Managing Member’s Additional Capital Contribution shall be the amount calculated based on NS Managing Member’s Hypothetical Promote Calculation.  If Chatham Managing Member is successful in any such Expedited Arbitration, then any amount so funded by Chatham Managing Member in excess of the amount of Chatham Managing Member’s Additional Capital Contribution based on the Hypothetical Promote Calculation determined by the Expedited Arbitration Procedures shall be promptly paid by the NS Managing Member to Chatham Managing Member.  
(iv)    Except as otherwise provided herein, no Member shall be entitled to any compensation by reason of its Capital Contribution or by reason of serving as a Member.  No Member shall be required to lend any funds to the Company.  
(d)    Failure to Fund Capital Contributions.  If a Member shall fail to timely make any Capital Contribution required pursuant to Section 2.2(c) (such Member being hereinafter referred to as a “Non-Contributing Member”), the Managing Member shall promptly give the other Members notice of the amount not funded by the Non-Contributing Member (such amount being hereinafter referred to as the “Failed Contribution”), and if one or more of such other Members shall have funded its ratable share of the Capital Contribution in question (each a “Contributing Member” and collectively, the “Contributing Members”), each Contributing Member shall have the right within fifteen (15) days after receipt of such notice to fund its pro rata portion of such Failed Contribution (such amount of all or any part of a Failed Contribution funded by such Contributing Member, the “Funded Amount”), and elect, at its sole election, to make such Additional Capital Contribution (i) as an Additional Capital Contribution by the Contributing Members (in which event the provisions of Section 2.2(d)(i) shall apply) or as (ii) a priming capital contribution to the Company in the amount of the Additional Capital Contribution required to be made by the Non-Contributing Member (the “Priming Capital Contribution”) (in which event the provisions of Section 2.2(d)(ii) shall apply).  
(i)    Adjustment of Capital Contribution and Percentage Interest of Non-Contributing Member.  If the Contributing Member elects to make an Additional Capital Contribution in lieu of a Non-Contributing Member, such Additional Capital Contribution shall be in the form of a Capital Contribution from the Contributing Member to the Company in lieu of the Non-Contributing Member.  If the Contributing Member so determines, then on the date of such contribution by such Contributing Member (i) the Capital Contributions of the Contributing Member making such Additional Capital Contribution in lieu of the Non-Contributing Member (for all purposes under this Agreement, including, without limitation, the making of computations under Article VII and Article X) shall be deemed to be increased by an amount equal to one hundred percent (100%) of the Additional Capital Contribution made by such Contributing Member in lieu of the Non-Contributing Member, and (ii) the Percentage Interest of the Members shall be adjusted to take into consideration the increase in such Contributing Member’s Capital Contributions (for all purposes under this Agreement, including, without limitation, the making of computations under Article VII and Article X).  In the event that one or more Contributing Members elect to treat their respective Funded Amounts as Additional Capital Contributions and the Non-Contributing Member subsequently contributes all or any portion of the Failed Contribution amount to the Company pursuant to the 10-day cure period in Section 3.6(a), (x) such contributed amount shall be distributed to the Contributing Member(s) pro rata in accordance with their respective Funded Amounts, and (y)(I) the Contributing Members’ Percentage Interests shall be decreased by such distribution in respect of its Funded Amount and (II) the Non-Contributing Member’s Percentage Interest shall be correspondingly increased.
(ii)    Priming Capital Contribution.  If the Contributing Member elects to make an Additional Capital Contribution as a Priming Capital Contribution, such Priming Capital Contribution shall earn the Priming Capital Contribution Return and shall be repaid from distributions of Available Cash pursuant to Section 7.1(a)(i) and Section 7.1(b)(i).  If there is more than one Priming Capital Contribution during the term hereof which relate to separate Capital Calls, the oldest Priming Capital Contribution and interest thereon shall be repaid in full first, with any subsequent Priming Capital Contribution and interest thereon being repaid in the order same were advanced.  Any amounts distributed to a Member in respect of a Priming Capital Contribution shall be allocated first, to the Priming Capital Contribution Return and second, to return of such Priming Capital Contribution.  The Members acknowledge and agree that Priming Capital Contributions shall not adjust the Percentage Interests of the Members.
(e)    Emergency Capital Contributions.  Notwithstanding the foregoing provisions of this Section 2.2, if (i) NS Managing Member or Chatham Managing Member is entitled to deliver a Capital Call and the Chatham Managing Member or NS Managing Member, as applicable, believes, in its reasonable discretion, that the Additional Capital Contribution is required by the Company by a date that is sooner than the applicable date set forth in the Capital Call, and (ii) a Member is unable or unwilling to deliver its pro rata portion of such Additional Capital Contribution by such earlier date, then the other Members may, but shall have no obligation to, contribute 100% of such Additional Capital Contribution on such earlier date.  In such event, (x) if the non-advancing Member subsequently funds its share (the “Required Contribution”) of the applicable Additional Capital Contribution on or before the required date set forth in the Capital Call, then the Required Contribution shall be distributed to the advancing Member (but shall not be deemed a distribution of Available Cash) and, for the avoidance of doubt, shall not be treated as a Failed Contribution or (y) if the non-advancing Member does not subsequently fund the Required Contribution on or before the required date set forth in the Capital Call, then the advancing Member shall have the rights of a Contributing Member set forth in Section 2.2(d) above with respect to such Required Contribution.
Section 1.14    Capital Accounts.
(a)    Capital Accounts.  A capital account (“Capital Account”) shall be maintained for each Member in accordance with this Section 2.3.  Without limiting the generality of the foregoing, a Member’s Capital Account shall be increased by (i) the amount of money contributed by the Member to the Company, including, for this purpose, Priming Capital Contributions, (ii) the initial Gross Asset Value of property contributed by the Member to the Company, as determined by the Contributing Member and the Managing Member (net of liabilities that the Company is considered to assume or take subject to pursuant to Code Section 752), (iii) allocations to the Member of Profits pursuant to Article VI, and (iv) the amount of any Company liability assumed by such Member.  A Member’s Capital Account shall be decreased by (x) the amount of money distributed to the Member, (y) the Gross Asset Value of any property so distributed to the Member as determined by the distributee Member and the Managing Member (net of any liabilities that such Member is considered to assume or take subject to pursuant to Code Section 752), and (z) allocations to the Member of Losses pursuant to Article VI. The Capital Accounts of the Members shall be adjusted in accordance with Treasury Regulations Sections 1.704-1(b)(2)(iv)(f) and (g) when the Gross Asset Value of all Assets are adjusted pursuant to the definition of Gross Asset Value.
(b)    Negative Capital Account.  No Member shall be required to make up a deficit balance in such Member’s Capital Account or to pay to any Member the amount of any such deficit in any such account.
(c)    Credit of Capital Contribution.  For purposes of computing the balance in a Member’s Capital Account, no credit shall be given for any Capital Contribution which such Member is to make until such Capital Contribution is actually made. For the avoidance of doubt, it is agreed that any Effective Date Deemed Capital Contribution will not constitute a Capital Contribution for purposes of maintaining Capital Accounts.
(d)    Transfer.  In the event of a Transfer of all or a portion of a Member’s interest in the Company in accordance with the terms of this Agreement, the transferee shall succeed to the Capital Account of the transferring Member to the extent it relates to the transferred interest.
Section 1.15    Admission of New Members.  Unless otherwise permitted under Article V, new Members may only be admitted to membership in the Company with the approval of NS Managing Member and Chatham Managing Member.  A new Member must agree in writing to be bound by the terms and provisions of the Certificate of Formation and this Agreement, each as may be amended from time to time, and must execute a counterpart of, or an agreement adopting, this Agreement or other related agreements as NS Managing Member and Chatham Managing Member may require.  Upon admission, the new Member shall have all rights and duties of a Member of the Company; provided, however, that such new Member shall only be entitled to such voting rights as are expressly provided pursuant to this Agreement.
Section 1.16    Interest.  No interest shall be paid or credited to the Members on their Capital Accounts or upon any undistributed amounts held by the Company.
Section 1.17    Capital Withdrawal Rights, Interest and Priority.  Except as expressly provided in this Agreement, no Member shall be entitled to withdraw or reduce such Member’s Capital Accounts in whole or in part until the dissolution, liquidation and winding-up of the Company, except to the extent that distributions pursuant to Article VII represent returns of capital.  A Member who withdraws or purports to withdraw as a Member of the Company without the consent of all of the Members or as otherwise allowed by this Agreement shall be liable to the Company for any damages suffered by the Company on account of the breach and shall not be entitled to receive any payment in respect of its Percentage Interest in the Company or a return of its Capital Contribution until the time otherwise provided herein for distributions to Members.
ARTICLE II.     
 
MANAGEMENT OF THE COMPANY
Section 2.1    Company Governance.  Each Member and the Company hereby agree that the Business and the Company shall be governed by the provisions of this Article III and that, accordingly, the Company shall cause its Subsidiaries to act in accordance with the determinations of the Company made pursuant to this Article III.
(a)    The Company shall generally be managed by NS Managing Member and the Managing Member (which, as of the date hereof, is Chatham Managing Member), who shall have the overall responsibility for the management, operation and administration of the Company.  Each of NS Managing Member and the Managing Member is, to the extent of its rights and powers set forth in this Agreement, an agent of the Company and the actions of the Company by and through such party taken in accordance with such rights and powers shall bind the Company.  Except as authorized by the Managing Member or as set forth in this Agreement, no Member shall participate in the management and control of the Business or the Company nor shall any Member have the right or authority to act on behalf of the Company in connection with any matter. 
(b)    Limitation on Liability of Managing Member.  The Managing Member shall not, solely by reason of being Managing Member, be personally liable for the expenses, liabilities or obligations of the Company whether arising in contract, tort or otherwise.
(c)    Compensation and Reimbursement.  (i)  Provided that such amounts are contemplated by the Operating Budget, not less than five days before the first Business Day of each month, Chatham Managing Member and Chatham Ink III Managing Member shall provide the Members with a notice setting forth (x) Chatham Managing Member’s good faith estimate of the out-of-pocket expenses that it will incur for such month in connection with its duties in its capacity as Managing Member of the Company and Chatham Ink III Managing Member’s good faith estimate of the out-of-pocket expenses that it will incur for such month in connection with its duties in its capacity as managing member of Ink III, including, without limitation, Chatham Managing Member’s and Chatham Ink III Managing Member’s reasonable costs and expenses of any Chatham Company Personnel, less (y) any amounts paid to Chatham Managing Member and Chatham Ink III Managing Member previously in respect of a Monthly Expense Amount in excess of expenses actually incurred by Chatham Managing Member and Chatham Ink III Managing Member for such month, plus (z) any expenses actually incurred by Chatham Managing Member and Chatham Ink III Managing Member previously with respect to a given month exceeding the Monthly Expense Amount for such month (together, the “Monthly Expense Amount”).  So long as neither Chatham Managing Member nor any of its Affiliates is in material default of its obligations under this Agreement or the Ink III LLC Agreement, or, if such party is in material default, such material default has been cured within thirty (30) days after written notice of such material default is delivered to Chatham Managing Member and Chatham Ink III Managing Member, as applicable, by any other Member, and provided that Chatham Managing Member has not been removed as the Managing Member pursuant to Section 3.2(h) and Chatham Ink III Managing Member has not been removed as the Managing Member of Ink III pursuant to Section 3.2(h) of the Ink III LLC Agreement, the Company shall pay to Chatham Managing Member in its capacity as Managing Member (or, at the written direction of Chatham Managing Member, to a designated Affiliate of Chatham REIT), on the first Business Day of each month or as promptly as practicable thereafter, an amount equal to the Company’s portion, determined based on a reasonable methodology agreed to between Chatham Managing Member and NS Managing Member, of the Monthly Expense Amount submitted for such month (the “Expense Reimbursement”), it being understood that such methodology may allocate different categories of expenses differently.
(ii)    Except as expressly set forth in clause (i) above or in any separate agreement between the Managing Member and the Company, the Managing Member shall not receive compensation or reimbursement of its expenses for its services performed on behalf of the Company or other benefits it provides to the Company.  
(iii)    At any time in connection with its review of Chatham Managing Member’s proposed Monthly Expense Amount for any month, NS Managing Member may in its reasonable discretion require that Chatham Managing Member eliminate the position(s) associated with particular Chatham Company Personnel and no longer include the costs associated with such position(s) as part of Chatham’s Monthly Expense Amount, beginning with the Monthly Expense Amount that is three months after Chatham Managing Member is notified of such requirement from NS Managing Member; provided, that the Managing Member shall be permitted to include in the applicable Monthly Expense Amount for the month in which such expenses are to be paid all severance and related costs incurred in connection with the termination of such Chatham Company Personnel at NS Managing Member’s request, to the extent the grant to such terminated Chatham Company Personnel of such severance obligation was approved by NS Managing Member or NS Ink III Managing Member, as applicable, at the time of grant.
(iv)    Chatham Managing Member and NS Managing Member acknowledge and agree that the Operating Budget shall include reimbursement for any costs in connection with any third party retained by NS Managing Member to oversee the activities of Chatham Managing Member and the operation of the Company and the Property Companies, which costs shall not exceed Three Hundred Thousand Dollars ($300,000) per annum.
Section 2.2    Authority, Duties and Obligations of the Managing Member.
(a)    The Member designated as the Managing Member (i) shall act in good faith and in the best interests of the Company and conduct and manage the day-to-day affairs of the Company in accordance with (A) the standard of care required of prudent and experienced joint venture managers and of third party asset and property managers performing similar functions for similar properties, (B) customary industry standards, and (C) the then-approved Operating Budget and the then-approved Business Plan, in each case subject to the limitations on the Managing Member’s authority and the rights granted solely to other Members set forth in this Agreement; (ii) shall perform the duties assigned to it hereunder; and (iii) shall use its best efforts to carry out all decisions permitted to be made unilaterally by NS Managing Member pursuant to this Agreement.  In addition to the foregoing, the authority of the Managing Member shall be limited where (x) any Member’s consent or approval is expressly required under this Agreement, (y) the consent or approval of any of the Members is expressly required by a non-waivable provision of applicable law, or (z) the Managing Member’s authority is otherwise limited or rights are otherwise granted solely to other Members by the terms of this Agreement. Notwithstanding anything to the contrary contained herein, neither the Managing Member nor any other Member shall have any fiduciary duties, fiduciary obligations or other duties to the Company, any other Member or any other Person, except as expressly set forth in this Agreement.  
(b)    In furtherance of the foregoing, and subject in each case to the terms of this Agreement, including the restrictions on the Managing Member set forth in Section 3.6(b), the Managing Member shall (i) use commercially reasonable efforts to enforce all agreements entered into by the Company; (ii) use commercially reasonable efforts to cause the Company at all times to perform and comply with the provisions (including, without limitation, any provisions requiring the expenditure of funds) of any loan commitment, agreement, mortgage, lease or other contract, instrument or agreement to which the Company is a party or which affects any Property; (iii) subject to the availability of the funds therefor, pay in a timely manner all non-disputed operating expenses of the Company in accordance with the terms of the then-approved Operating Budget and the then-approved Business Plan; (iv) subject to the availability of the funds therefor, obtain and maintain insurance coverage with respect to the Properties, at customary levels and in any event consistent with the requirements of any Loans, and, subject to the availability of the funds therefor, pay all non-disputed taxes, assessments, charges and fees payable in connection with the ownership, operation and sale of the Properties; (v) devote sufficient time to the performance of its duties hereunder in accordance with good industry practice and this Agreement; and (vi) provide NS Managing Member with copies of all material correspondence and other communications with any Lender pertaining to any Loan, as and when the same are delivered or received.
(c)    The Managing Member hereby covenants and agrees that it shall cause its personnel, including all Chatham Company Personnel, to perform and/or supervise the performance of, as applicable, all of the day-to-day activities and/or duties required of the Managing Member under the terms of this Agreement; and (ii) no Chatham Company Personnel shall spend any business time as an employee of Chatham Managing Member on any project(s) other than the Business of Ink III, the Company and their respective Subsidiaries.
(d)    Promptly following any request therefor by any Member, the Managing Member shall deliver to such Member a counterpart copy of any agreement, certificate or other document executed and delivered by the Managing Member in the name of or on behalf of the Company, and shall otherwise make available to any Member all of the books and records of the Company that are in the possession or control of the Managing Member during reasonable business hours; provided, that from and after the occurrence of a Termination Event, this paragraph (d) shall apply only to NS Managing Member, and Chatham Managing Member shall no longer have any of the rights set forth in this paragraph (d).
(e)    Provided that Chatham Managing Member has not been removed as the Managing Member pursuant to Section 3.2(g) hereof, the Chatham Principal and the other officers of the Managing Member shall at all times oversee the fulfillment of the duties of the Managing Member hereunder.  Except as expressly provided or permitted herein, the Managing Member shall not delegate any of its rights or powers to manage and control the business and affairs of the Company without the prior written consent of NS Managing Member.
(f)    The Managing Member hereby covenants and agrees that it shall not hold itself out to any third party as having any authority to act for or on behalf of the Company, or to bind the Company in any manner, other than to the extent that such authority is expressly granted to the Managing Member in Section 3.2(a) or otherwise granted herein or in writing by NS Managing Member.  The Managing Member hereby acknowledges and agrees that notwithstanding anything set forth in this Section 3.2 to the contrary, the Managing Member shall not have any authority to act on behalf of the Company or to execute any documents, agreements or instruments on behalf of the Company other than to the extent that such authority is set forth in Section 3.2(a) or otherwise expressly granted under this Agreement or in writing by the Members, and the Managing Member, acting in such capacity, shall be subject, in all events, to the then-approved Operating Budget and Business Plan of the Company.
(g)    Notwithstanding anything set forth in Section 3.2(a)-(j) hereof to the contrary, NS Managing Member shall have the power and authority, on behalf of the Company, to request, authorize and approve each of the following without the approval or consent of any other Member:
(i)    Compel, cause and undertake the liquidation of the Company and take all actions related thereto, including the disposition of all then remaining Properties, so long as such liquidation will not (A) cause a default under any then existing Loan Documents, (B) cause Chatham Managing Member to incur or suffer any recourse liability under any then existing Loan Documents (including, without limitation, any Carveout Guaranty given by Chatham REIT or any of its Affiliates), (C) cause Chatham Managing Member or any of its Affiliates to become the subject of a Bankruptcy, (D) cause the Company to fail to satisfy the gross income and asset tests applicable to REITs under Code Section 856(c)(1)-(4), assuming for this purpose that the Company were a REIT, (E) cause Chatham REIT to incur a liability for the tax on “prohibited transactions” under Code Section 857(b)(6), or (F) otherwise jeopardize the REIT status of Chatham REIT; provided, however, that NS Managing Member shall keep the other Members reasonably informed of any material actions undertaken pursuant to this clause (i) with respect to intended, planned or pending dispositions;
(ii)    Demand and receive an updated Operating Budget and Business Plan (and require Chatham Managing Member to amend any Operating Budget due to a change in facts or circumstances from when the Operating Budget was initially approved) from the Managing Member, at any time and from time to time but in any event no more than once each fiscal quarter, together with such other reporting items or information as NS Managing Member may reasonably require; 
(iii)    Audit the books and records of the Company and any Property Companies; provided, however, that the Company shall only be required to pay for one such audit per calendar year, and any additional audits requested by NS Managing Member in any given calendar year shall be paid for by NS Managing Member;
(iv)    Compel, cause and undertake the disposition of any Property in an arms’ length transaction to any Person other than NS Managing Member or an Affiliate of NS Managing Member, so long as such disposition will not (A) cause a default under any then existing Loan Documents, (B) cause Chatham Managing Member to incur or suffer any recourse liability under any then existing Loan Documents (including, without limitation, any Carveout Guaranty given by Chatham REIT or any of its Affiliates), (C) cause Chatham Managing Member or any of its Affiliates to become the subject of a Bankruptcy, (D) cause the Company to fail to satisfy the gross income and asset tests applicable to REITs under Code Section 856(c)(1)-(4), assuming for this purpose that the Company were a REIT, (E) cause Chatham REIT to incur a liability for the tax on “prohibited transactions” under Code Section 857(b)(6), or (F) otherwise jeopardize the REIT status of Chatham REIT; provided, however, that NS Managing Member shall keep the other Members reasonably informed of any material actions undertaken pursuant to this clause (iv) with respect to intended, planned or pending dispositions;
(v)    Take any action which may be reasonably necessary for the continuation of the Company’s valid existence as a limited liability company under the laws of the State of Delaware; provided, however, that NS Managing Member shall keep the Managing Member reasonably informed of any material actions undertaken pursuant to this clause (v);
(vi)    Approve any restructuring plan or take or refrain from taking any other action relating to the restructuring of the Company, any Property or any Loan, so long as such restructuring will not (A) cause a default under any then existing Loan Documents, (B) cause Chatham Managing Member to incur or suffer any recourse liability under any then existing Loan Documents (including, without limitation, any Carveout Guaranty given by Chatham REIT or any of its Affiliates), (C) cause Chatham Managing Member or any of its Affiliates to become the subject of a Bankruptcy, (D) cause the Company to fail to satisfy the gross income and asset tests applicable to REITs under Code Section 856(c)(1)-(4), assuming for this purpose that the Company were a REIT, (E) cause Chatham REIT to incur a liability for the tax on “prohibited transactions” under Code Section 857(b)(6) (F) otherwise jeopardize the REIT status of Chatham REIT, or (G) be more adverse to any Member other than NS Managing Member than it is to NS Managing Member; provided, that the restrictions contained in this clause (G) shall not apply to a restructuring of the Company, any Property or any Loan to the extent NS Managing Member has made a good faith determination that such restructuring is reasonably necessary to avoid, or mitigate the effects of, an existing default or an impending or imminent default under any Loan or franchise agreement and that the disproportionately adverse impact is reasonably necessary to consummate the restructuring on terms that, in NS Managing Member’s good faith judgment, are in the aggregate most favorable to the Company; provided, further, that NS Managing Member shall keep the Managing Member reasonably informed of any material actions undertaken pursuant to this clause (vi);
(vii)    Conduct an initial public offering of the Company into a separate public traded company upon at least 30 days’ notice prior to the initial filing of the registration statement for such initial public offering (a “Qualified IPO Demand”), provided that Chatham Managing Member’s consent shall be required with respect to such initial public offering unless (i) it is a Qualified IPO, (ii) such Qualified IPO does not adversely affect in any material respect Chatham Managing Member’s rights and economic interests provided in this Agreement in a manner that is disproportionate to any such effect on NS Managing Member, (iii) such Qualified IPO does not (I) cause the Company to fail to satisfy the gross income and asset tests applicable to REITs under Code Section 856(c)(1)-(4), assuming for this purpose that the Company were a REIT, (II) cause Chatham REIT to incur a liability for the tax on “prohibited transactions” under Code Section 857(b)(6), or (III) otherwise jeopardize the REIT status of Chatham REIT, (iv) Chatham Managing Member receives customary piggyback registration rights in connection with such Qualified IPO and customary registration rights following such Qualified IPO, in each instance in this clause (iv), as applied to a non-controlling holder and (v) unless Chatham Managing Member sells membership interests in such Qualified IPO pursuant to piggyback rights, NS Managing Member reimburses the Company and IPO Entity for all registration expenses incurred by the Company or IPO Entity in connection with such Qualified IPO.  Subject to proviso in the preceding sentence, such Qualified IPO may be effectuated by whatever corporate or company action or restructuring is reasonably required by NS Managing Member in order to effectuate such Qualified IPO, including, by way of example only, by creating a new parent entity, subsidiary, parallel vehicle, or other entity formed in connection with or otherwise resulting from a restructuring of the legal status and/or capital structure of the Company (any such entity, an “IPO Entity”), which IPO Entity may be a corporation and may elect to be treated as a REIT for U.S. federal income tax purposes; 
(viii)    Cause the Company or any Property Company to refinance, amend or otherwise modify the terms and conditions of any Loan, so long as such refinancing will not (A) cause a default under any then existing Loan Documents, (B) cause Chatham Managing Member to incur or suffer any recourse liability under any then existing Loan Documents (including, without limitation, any Carveout Guaranty given by Chatham REIT or any of its Affiliates), (C) cause Chatham Managing Member or any of its Affiliates to become the subject of a Bankruptcy, (D) cause the Company to fail to satisfy the gross income and asset tests applicable to REITs under Code Section 856(c)(1)-(4), assuming for this purpose that the Company were a REIT, (E) cause Chatham REIT to incur a liability for the tax on “prohibited transactions” under Code Section 857(b)(6), (F) otherwise jeopardize the REIT status of Chatham REIT or (G) be more adverse to any Member other than NS Managing Member than it is to NS Managing Member; provided, that NS Managing Member shall keep the Managing Member reasonably informed of any material actions undertaken pursuant to this clause (viii); and
(ix)    Notwithstanding anything to the contrary contained herein, cause the Company or any Property Company to become the subject of a Bankruptcy.
(h)    Upon the occurrence of a Termination Event, NS Managing Member shall have the right, in its sole and absolute discretion, to remove Chatham Managing Member as Managing Member hereunder by delivering written notice (a “Removal Notice”) to Chatham Managing Member stating that NS Managing Member believes a Termination Event has occurred, describing the basis of such belief and specifying the applicable clause of the definition of “Termination Event” and the removal of the Chatham Managing Member shall be effective on the date set forth in the Removal Notice (which date may be the date of the Removal Notice or any date thereafter as designated by NS Managing Member).  In the event that NS Managing Member removes Chatham Managing Member as Managing Member pursuant to this Section 3.2(h), (i) NS Managing Member shall have the right, in its sole and absolute discretion, to either become or designate an Affiliate to become the Managing Member of the Company or cause the Company to engage a third-party manager for the Company’s business, (ii) the consent of Chatham Managing Member shall no longer be necessary for any Major Decision other than a Post-Termination Major Decision, and (iii) except in connection with a Promote Forfeiture Event (in which case Chatham Managing Member shall not be entitled to Wind-Down Expenses), upon its removal as Managing Member, Chatham Managing Member may submit to the Company and NS Managing Member a good faith estimate of the amount of expenses (the “Wind-Down Expenses”) it will reasonably incur in connection with the wind-down of its duties in its capacity as Managing Member, including without limitation Approved Severance Costs, together with reasonably detailed backup for such estimate, and the Company will promptly pay such Wind-Down Expenses to Chatham Managing Member (or, at the written direction of Chatham Managing Member, to a designated Affiliate of Chatham Managing Member); provided, that in no event shall the Company be required to pay to Chatham Managing Member under this Section 3.2(h) Wind-Down Expenses that, when aggregated with the Wind-Down Expenses payable by Ink III pursuant to Section 3.2(h) of the Ink III LLC Agreement, exceed $500,000 unless such excess amounts result from liabilities or obligations incurred in accordance with the applicable Operating Budget and Business Plan as approved by NS Managing Member and NS Ink III Managing Member at the time of incurrence as potential Wind-Down Expenses, or as otherwise approved in writing by NS Managing Member and NS Ink III Managing Member as potential Wind-Down Expenses.
(i)    Notwithstanding the foregoing, in the event Chatham Managing Member seeks to contest whether a Termination Event occurred, Chatham Managing Member shall have the right to deliver a notice (the “Response Notice”) on or prior to the date that is fourteen (14) days after Chatham Managing Member has been removed, which Response Notice shall state that Chatham Managing Member either (i) disagrees that a Termination Event has occurred and is submitting such dispute to an expedited arbitration hearing (each an “Expedited Arbitration”) pursuant to and in accordance with the Expedited Arbitration Procedures set forth in Schedule K attached hereto or (ii) that Chatham Managing Member does not dispute that a Termination Event has occurred (it being agreed that if Chatham Managing Member fails to timely deliver a Response Notice it shall be deemed to have delivered a Response Notice pursuant to this clause (ii).  If Chatham Managing Member is successful in any such Expedited Arbitration then, (A) Chatham Managing Member shall be reinstated as the Managing Member of the Company, and (B) NS Managing Member (or a third party appointed by NS Managing Member) shall be removed as the Managing Member.  Chatham Managing Member acknowledges and agrees that (i) Chatham Managing Member shall not attempt to obtain injunctive relief or any other remedy available at law or equity to interfere with or delay the removal of the Chatham Managing Member, as the Managing Member, and (ii) if Chatham Managing Member breaches the foregoing, then NS Managing Member shall have the right to file a copy of this Section in any proceeding as conclusive evidence of the foregoing intent by the Chatham Managing Member. 
(j)    If Chatham Managing Member is removed as the Managing Member as a result of an act of fraud or misappropriation of funds by Chatham Managing Member or any Person affiliated with Chatham Managing Member (including the Chatham Principal) in connection with the performance of Chatham Managing Member’s obligations hereunder, then from and after the date of removal of Chatham Managing Member, Chatham Managing Member shall forfeit its rights to deliver a Buy/Sell Notice under the provisions of Section 3.7.
(k)    If Chatham Managing Member (or any Affiliate or principal of Chatham Managing Member) has any liability under a Carveout Guaranty, then NS Managing Member shall use good faith efforts to deliver to Chatham Managing Member as a condition to the removal of Chatham Managing Member as Managing Member a full and unconditional release from such Lender of all such liability other than any liability resulting directly from acts of Chatham Managing Member or its Affiliates prior to the effective date of such removal, provided that if Lender refuses to grant such release to Chatham Managing Member then NS Managing Member shall be required as a condition to the removal of Chatham Managing Member as Managing Member to deliver to Chatham Managing Member a full and unconditional release from such Lender of all liability under a Carveout Guaranty arising for events first occurring after the effective date of the removal of Chatham Managing Member as Managing Member (and not a release for all acts other than those arising from acts of Chatham Managing Member).  In connection with the JPM Loan, the parties acknowledge and agree that NS Managing Member shall only be required to deliver to Chatham Managing Member a full and unconditional release of all liability under the Carveout Guaranty arising for events first occurring after the effective date of the removal of Chatham Managing Member as Managing Member (and not a release for all acts other than those arising from acts of Chatham Managing Member).
Section 2.3    Managing Member Certifications.  Any Person dealing with the Company may rely (without duty of further inquiry) upon a certificate issued by the Company that is signed by the Managing Member or any of the Officers as to any of the following:
(a)    the identity of any Member or Officer or other agent of the Company;
(b)    the existence or nonexistence of any fact or facts which constitute(s) a condition precedent to acts by the Managing Member or the Members;
(c)    the Person or Persons authorized to execute and deliver any instrument or document of the Company; or 
(d)    any act or failure to act by the Company or any other matter whatsoever involving the Company.
Section 2.4    Officers.  
(a)    Principal Officers.  The Officers of the Company shall be a President and Chief Executive Officer, and may be a Chief Operating Officer, Chief Financial Officer, Secretary, Treasurer, one or more Vice Presidents, and one or more Assistant Treasurers or Assistant Secretaries.
(b)    Other Officers.  The Managing Member may also appoint such other Officers and agents as it shall deem necessary who shall hold their offices for such terms and shall, subject to the limitations set forth herein, exercise such powers and perform such duties as shall be determined from time to time by the Managing Member. 
(c)    Compensation.  In no event shall the Company be required to pay any compensation to any Officer.
(d)    Authority of Officers.
(i)    The President and Chief Executive Officer (or “President and CEO”) of the Company shall have general and active management of the Company, shall have the responsibility for the day-to-day management and operation of the Company, and shall see that all lawful orders and resolutions are carried out.  The President and CEO shall execute bonds, mortgages and other contracts except where the signing and execution shall be expressly delegated by the Members or, to the extent permitted by this Agreement, the Managing Member to one or more other officers or agents of the Company.
(ii)    If appointed, the Chief Operating Officer, Chief Financial Officer, Vice Presidents, Treasurer, Secretary, Assistant Treasurers and Assistant Secretaries shall have the powers and duties described in this Section 3.4, as may be modified from time to time by the Managing Member:
		
	1)
	Chief Operating Officer.  The Chief Operating Officer shall have responsibility for the day-to-day management and operation of the Business, general oversight of the operation of the Company’s operations and employees, and other such duties and responsibilities as determined by the President and CEO or the Managing Member.

		
	2)
	Chief Financial Officer.  The Chief Financial Officer shall have responsibility for the day-to-day management and general oversight of the accounting and finance function of the Company and supervision of any Treasurer and Assistant Treasurers, and other such duties and responsibilities as determined by the President and CEO, the Chief Operating Officer or the Managing Member.

		
	3)
	The Vice Presidents.  The Vice Presidents shall perform such duties and have such powers as the Managing Member or the President and CEO or the Chief Operating Officer may from time to time prescribe.

		
	4)
	The Secretary; Assistant Secretary.  The Secretary shall attend all meetings of the Members and record all the proceedings of the meetings of the Company and of the Members in a book to be kept for that purpose and shall perform like duties for any standing committees when required.  He or she shall give, or cause to be given, notice of all meetings of committees of the Company, and shall perform such other duties as may be prescribed by the Managing Member or the President and CEO, under whose supervision he or she shall be.  In the absence of the Secretary or in the event of his or her incapacity or refusal to act, or at the direction of the Secretary, any Assistant Secretary may perform the duties of the Secretary.

		
	5)
	The Treasurer; Assistant Treasurer.  The Treasurer shall have the custody of the Company’s funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the Company and shall deposit all moneys and other valuable effects in the name and to the credit of the Company in such depositories as may be designated by the Members.  The Treasurer shall disburse the funds of Company as may be ordered by the Members or, to the extent permitted by this Agreement, the Managing Member, President and CEO, Chief Financial Officer or Chief Operating Officer, taking proper vouchers for such disbursements, and shall render to the President and CEO, Chief Operating Officer, Chief Financial Officer and Managing Member, or when any Officer so requires, an account of all transactions as treasurer and of the financial condition of the Company.    

(e)    Limitations on Officer’s Powers.  Notwithstanding any other provision contained in this Agreement to the contrary, should a delegation of authority be established by the Managing Member, no act shall be taken, sum expended, decision made, obligation incurred or power exercised by any Officer on behalf of the Company other than in accordance with such delegation of authority.
(f)    Term of Officers.  (i)  An Officer may resign at any time by giving written notice to the Managing Member.  The resignation of an Officer shall take effect upon the Managing Member’s receipt of written notice of the Officer’s resignation or at such later time as shall be specified in the written notice.  Unless otherwise specified in the Officer’s written notice of resignation, the acceptance of the Officer’s resignation shall not be necessary to make it effective.  If the Officer also is a Member, the Officer’s resignation as an Officer shall not affect the Officer’s rights as a Member and shall not constitute a withdrawal of the Officer as a Member.
(ii)    The Managing Member may terminate the employment of and/or remove any Officer with or without cause.
(iii)    The Managing Member may elect at any time a new or replacement Officer to fill any vacancy.
(g)    Acknowledgement.  The Members acknowledge and agree that as of the Effective Date no Officers have been appointed to the Company. Notwithstanding anything to the contrary contained herein, the Managing Member shall not appoint Officers to the Company without the prior written consent of NS Managing Member.
Section 2.5    Operating Budget and Business Plan.  (g) For the period beginning on the Effective Date and ending on December 31, 2014, the Company and Ink III shall operate in accordance with an Operating Budget to be mutually agreed upon by the Members after the Effective Date.  Thereafter, the Operating Budget and Business Plan shall be prepared and submitted annually by the Managing Member and Chatham Ink III Managing Member (or the Hotel Manager at the direction of the Managing Member and Chatham Ink III Managing Member) to the Members for approval at least thirty (30) calendar days prior to the end of each fiscal year with respect to the following fiscal year which shall, in the case of the Operating Budget, set forth, inter alia, all anticipated revenues, operating expenses, capital expenditures, renovation budgets, renovation schedules and reserves for the Company and Ink III during such period, and, in the case of the Business Plan shall set forth, inter alia, the Company’s and Ink III’s strategy for the leasing, marketing and operation of each of the Properties, and an estimate of the amount, timing and reason for all anticipated Capital Contributions from the Members during such period; provided, that if the Managing Member should fail to timely prepare and submit in proposed form any such Operating Budget and Business Plan, NS Managing Member and NS Ink III Managing Member shall be authorized to prepare such Operating Budget and Business Plan for the approval of the Members.  Whenever the Managing Member determines that revisions to the then-approved Operating Budget or Business Plan would be in the best interests of the Company, the Managing Member may submit such proposed revisions to such Operating Budget and/or Business Plan to NS Managing Member for its review; provided, however, that all amendments and modifications to the then-approved Operating Budget or Business Plan shall require the approval of NS Managing Member, which approval may be granted or withheld by NS Managing Member in its sole and absolute discretion.
(h)    Notwithstanding Section 3.5(a), in the event that the Members are unable to agree on all or certain provisions of an Operating Budget or Business Plan for a given year, (i) the Managing Member will conduct the business of the Company pursuant to those provisions of such Operating Budget or Business Plan which are agreed-upon and adopted and (ii) the Operating Budget or Business Plan for the prior Fiscal Year shall be applicable with respect to those line items that have not been approved; provided, however, the foregoing shall not apply to line items pertaining to any capital expenditures, project management costs or Capital Contributions, which line items must be approved by NS Managing Member and the prior year’s amounts thereof shall not be applicable unless such amounts are required to be paid to prevent a default under a Loan or any franchise agreement affecting the Properties. With respect to any aspects of the business of Company that are not addressed by the Operating Budget or Business Plan for that given year, the Managing Member is authorized and directed to cause the employees of the Company to conduct such aspect of the business of the Company in accordance with the guidelines set forth in the most recently approved Operating Budget or Business Plan, as applicable, and otherwise in accordance with prior practice; provided, however, that, if applicable, the Managing Member may adjust the annual compensation of the Chatham Company Personnel and other expenses of the Company for inflation.
Section 2.6    Voting Rights of Members.
(a)    The Members shall have no right or authority to vote on matters other than matters explicitly requiring such vote in this Agreement or in the Act.  For matters set forth in this Agreement explicitly requiring a vote of the Members, such matters shall require the vote of all Members.  In the event any Member shall transfer less than all of its Percentage Interest to an unaffiliated third party in a transaction or in a series of transactions, then the portion of such Member’s votes that is equal to the portion of such Member’s Percentage Interest transferred shall be deemed cancelled and the transferee (if an unaffiliated third party) in such transfer shall not have the right to vote on any matter as an “Member”.  In the event any Member shall transfer its entire Percentage Interest held on the date of such transfer to an unaffiliated third party in a transaction or in a series of transactions, then all of the votes of its Percentage Interest on the date of such transfer shall be deemed to have been transferred to such transferee upon the satisfaction of the conditions contained in Article V and such transferee shall not have the right to vote on any matter as a “Member”.  Notwithstanding the foregoing, if at any time a Member (i) shall transfer more than 50% of such Member’s Percentage Interest (excluding, however, Permitted Transfers), or (ii) shall be in default with respect to its obligations to fund additional capital contributions pursuant to Section 2.2 above, the remaining votes of such Member shall be deemed cancelled and such Member shall have no voting rights except as otherwise required by the Act; provided, that in the case of clause (ii), (x) to the extent Contributing Member(s) elect to treat their respective Funded Amounts as Priming Capital Contributions and such Non-Contributing Member repays all such Priming Capital Contributions (including all interest thereon) within 10 days, the voting rights of such Member shall be reinstated and (y) to the extent the Contributing Member(s) elect to treat their respective Funded Amounts as Additional Capital Contributions, the Company shall provide notice to such Non-Contributing Member on the next Business Day indicating such election and the voting rights of such Non-Contributing Member shall be deemed cancelled if the Non-Contributing Member does not provide its capital contribution to the Company within 10 days after receipt of such notice. 
(b)    Notwithstanding anything to the contrary in this Agreement, unless expressly set forth in this Agreement (including pursuant to Section 3.2(h) above), the Company shall not approve or take, and the Managing Member shall neither take nor cause the Company to take or approve, any action with respect to any Major Decision without the affirmative vote or written consent of all of the Members.
Section 2.7    Buy/Sell.  At any time after the second (2nd) anniversary of the Effective Date, the following shall apply:
(a)    Either NS Managing Member or Chatham Managing Member (as the case may be, the “Proposing Member”) shall have the right (but not the obligation) to deliver a written notice (the “Buy/Sell Notice”) to the other Member (the “Non-Proposing Member”), which Buy/Sell Notice (in order to be effective) shall: (i) state that the Proposing Member offers to purchase all of the membership interest in the Company of the Non-Proposing Member, (ii) set forth an all-cash valuation (the “Asset Purchase Price”) for all of the Buy/Sell Assets, (iii) set forth the name and address of a national escrow agent selected by the Proposing Member and reasonably acceptable to the Non-Proposing Member (the “Buy/Sell Escrow Agent”) in connection with the transactions contemplated under this Section 3.7, (iv) be accompanied by a certified or bank check payable to the order of the Buy/Sell Escrow Agent or evidence of a wire transfer of immediately available federal funds to the Buy/Sell Escrow Agent (such check or wire transfer, the “Proposing Member’s Deposit”) in an amount equal to three and one-quarter percent (3.25%) of the Asset Purchase Price, and the parties shall otherwise act in accordance with the escrow provisions set forth on Schedule H attached hereto, and (v) provide that the Proposing Member shall indemnify the Non-Proposing Member against any liabilities it incurs as a result of any failure to obtain any consent required from a franchisor to the acquisition by the Proposing Member contemplated by such Buy/Sell Notice that is required pursuant to any franchise agreement to which the Company or any of its Subsidiaries is a party.  For the avoidance of doubt, the parties acknowledge and agree that in the event the Proposing Member elects to send a Buy/Sell Notice, the Proposing Member must offer to purchase all of the limited liability company interests of the Non-Proposing Member in the Company (i.e., the Proposing Member may not offer to purchase less than 100% of all of the Non-Proposing Members’ membership interest in the Company).  Any Buy/Sell Notice that does not comply with the foregoing provisions of this Section 3.7(a) shall be void and of no force or effect.
(b)    On or before the expiration of the Buy/Sell Response Period, the Non-Proposing Member shall respond to the Buy/Sell Notice by delivering a notice (a “Buy/Sell Response”) to the Proposing Member.  The Buy/Sell Response, in order to be effective for any purpose, shall (i) state either (x) that the Non-Proposing Member elects to sell its membership interest in the Company to the Proposing Member at the Buy/Sell Membership Interest Purchase Price or (y) that the Non-Proposing Member elects to purchase the membership interest of the Proposing Member in the Company at the Buy/Sell Membership Interest Purchase Price, (ii) if an election is made by the Non-Proposing Member under clause (i)(y) above, be accompanied by a certified or bank check payable to the order of the Buy/Sell Escrow Agent or evidence of a wire transfer of immediately available federal funds to the Buy/Sell Escrow Agent (such check or wire transfer, the “Non-Proposing Member’s Deposit”) in an amount equal to three and one-quarter percent (3.25%) of the Asset Purchase Price and (iii) if an election is made by the Non-Proposing Member under clause (i)(y) above, be accompanied by either the bank or certified check delivered by the Proposing Member (if the Proposing Member made the Proposing Member’s Deposit in the form of a bank or certified check and solely to the extent the Non-Proposing Member has not theretofore deposited any such check into escrow with the Buy/Sell Escrow Agent) or an instruction to the Buy/Sell Escrow Agent (or its financial institution) to refund to the Proposing Member the amounts deposited in escrow together with any accrued interest earned thereon.  The failure of the Non-Proposing Member to respond during the Buy/Sell Response Period, or the failure of any Buy/Sell Response purportedly delivered under this Section 3.7(b) to comply with the provisions of this Section 3.7(b), shall be deemed to be an election by the Non-Proposing Member to sell its membership interest in the Company to the Proposing Member at the Buy/Sell Membership Interest Purchase Price; provided, however, if the Non-Proposing Member fails to respond during the Buy/Sell Response Period, then the Proposing Member shall have the right, exercisable within fifteen (15) days after the expiration of the Buy/Sell Response Period, to withdraw its Buy/Sell Notice, in which event the Buy/Sell Deposit Funds shall be refunded to the Proposing Member and such Buy/Sell transaction shall be deemed terminated and without effect, provided, further, however, such determination to withdraw by the Proposing Member shall not affect the Proposing Member’s right to deliver future Buy/Sell Notices which right shall continue in full force and effect. 
(c)    In the event the closing occurs with respect to the purchase by the Purchasing Member such closing shall be on the terms set forth on Schedule G attached hereto.
(d)    The Members acknowledge and agree the following with respect to the buy/sell process set forth in this Section 3.7:  (i) concurrently with the delivery of the Buy/Sell Notice under this Agreement, the Proposing Member shall be required to deliver a Buy/Sell Notice under the Ink III LLC Agreement; (ii) the Non-Proposing Member shall be required to make the same election in the Buy/Sell Response under this Agreement and the Buy/Sell Response under the Ink III LLC Agreement (i.e., the Non-Proposing Member shall not have the right to elect to sell its interests in the Company to the Proposing Member under this Agreement and then elect to buy the interests of the Proposing Member in Ink III under the Ink III LLC Agreement; (iii) in the event either Member fails to comply with any obligation under the buy/sell process set forth in Section 3.7 of the Ink III LLC Agreement, then such failure shall be deemed a default by such Member under this Section 3.7 (i.e., a Member shall not be permitted to consummate the buy/sell process contemplated by this Section 3.7 unless, concurrently therewith, it is consummating the buy/sell process contemplated by Section 3.7 of the Ink III LLC Agreement); and (iv) the buy/sell process contemplated by this Section 3.7 shall close simultaneously with the buy/sell process contemplated by Section 3.7 of the Ink III LLC Agreement).
(e)    Notwithstanding the foregoing, Chatham Managing Manager shall not have the right to deliver a Buy/Sell Notice during a Spin-Off Blackout Period or during a Portfolio Sale Blackout Period. 
Section 2.8    Put/Call Options. 
(a)    Put Option.  Within fifteen (15) Business Days after the Put Option Commencement Date, Chatham Managing Member shall have the right, but not the obligation, to deliver a written notice to NS Managing Member (the “Put Notice”) indicating its election to sell to NS Managing Member (and requiring NS Managing Member to buy from Chatham Managing Member) all of Chatham Managing Member’s right, title and interest in and to the Company (the “Option Interests”) in accordance with this Section 3.8(a).  For purposes hereof, the “Put Option Commencement Date” shall mean the date on which either (i) NS effectuates a Permitted Corporate Transaction that is a spin-off and the result thereof is that NRFC, NSAM or any of their respective Affiliates no longer Controls NS Managing Member, (ii) there is a Change in Control with respect to NS Managing Member, or a Parent Change in Control, that in either instance results in NS Managing Member being Controlled by a Chatham Competitor or (iii) NS Managing Member makes a Qualified IPO Demand. 
(b)    Call Option.  At any time following the Call Option Commencement Date, NS Managing Member shall have the right, but not the obligation, to deliver a written notice to Chatham Managing Member (the “Call Notice”; and together with the Put Notice, collectively, the “Option Notice”) of its good faith intention to spin-off one hundred percent (100%) of the membership interests in the Company and that it is therefore electing to purchase from Chatham Managing Member (and requiring Chatham Managing Member to sell to NS Managing Member) the Option Interests in accordance with this Section 3.8(b).  For purposes hereof, the “Call Option Commencement Date” shall mean the date on which NS determines that it desires to spin-off one hundred percent (100%) of the membership interests in the Company.  NS Managing Member shall not be permitted to deliver a Call Notice within six (6) months of the end of a Spin-Off Blackout Period.
(c)    Option Price.
(i)    In each case (i.e., “Put Option” or “Call Option”) other than a Put Option pursuant to Section 3.8(a)(iii):
		
	1)
	The purchase price for the Option Interests (the “Option Price”) shall be equal to the amount of Available Cash that Chatham Managing Member would have received pursuant to the application of the provisions of Section 7.1 if the Assets were sold to a third party on the Option Closing Date for a price equal to the Fair Market Value and an amount equal to the Adjusted Fair Market Value was distributed to the Members (it being agreed that any disputes as to Fair Market Value Additions, Fair Market Value Prorations and/or the allocation of the Fair Market Value among the Assets shall be resolved by the determination of the Accountants, which determination shall be binding on the Members, absent manifest error).

		
	2)
	In the event that the applicable party delivers an Option Notice (in each case, the “Initiating Party”) to the appropriate counter-party (in each case the “Notice Recipient”), said Initiating Party shall set forth in the Option Notice (i) its proposed Option Price and (ii) a calculation of its Option Price, inclusive of its determination of the fair market value of each of the Assets (the “Initiating Party Fair Market Value”).  Notwithstanding the foregoing, the Initiating Party Fair Market Value and consequent Option Price shall not be binding on the parties until such time as agreed to, in writing, by both the Initiating Party and the Notice Recipient.  

		
	3)
	Within fifteen (15) Business Days of receipt of an Option Notice, the Notice Recipient shall respond in writing to the Initiating Party either (i) agreeing to the Initiating Party Fair Market Value (each a “Value Acceptance Notice”), or (ii) disagreeing with the Initiating Party Fair Market Value (each a “Value Dispute Notice”; and together with a Value Acceptance Notice, each a “Notice Response”).  All Value Dispute Notices shall set forth the Notice Recipient’s opinion as to the fair market value of the Assets.  The foregoing notwithstanding, failure of a Notice Recipient to timely deliver a Notice Response shall be deemed a Value Dispute Notice by the Notice Recipient delivered on the last day of such fifteen (15) Business Day period. 

		
	4)
	In the event that the Notice Recipient delivers a Value Dispute Notice, then the parties shall work together in good faith for up to ten (10) days (the “Value Negotiation Period”) in an attempt to establish a mutually agreed upon fair market value of the Assets.  In the event that the parties are able to agree upon a fair market value of the Assets prior to the expiration of the Value Negotiation Period, then the parties shall work together in good faith to close the contemplated transaction prior to the end of the Option Closing Period. In the event that Value Negotiation Period expires without the parties having agreed to a mutually acceptable fair market value, then the fair market value shall be determined in accordance with Section 3.8(d).

(ii)    In the case of a Put Option pursuant to Section 3.8(a)(iii), the purchase price for the Option Interests shall be equal to Chatham Managing Member’s Percentage Interest multiplied by the equity capitalization of the Company or IPO Entity, as applicable, based on the price of the equity interests sold in the Qualified IPO. 
(d)    Appraisal.  In each case (i.e., Put Option or Call Option) other than a Put Option pursuant to Section 3.8(a)(iii):
(i)    If the parties are unable to agree on a Fair Market Value prior to the expiration of the Value Negotiation Period, then each party shall promptly select a unaffiliated third party, MAI appraiser or investment sales broker, who or that, as the case may be, has been actively involved in the valuation or sales of assets comparable to the Assets over the ten (10) years preceeding the delivery of the applicable Option Notice as reasonably determined by the selecting party (each an “Appraiser”) to determine a fair market value of the Assets.  If either party reasonably objects to an Appraiser chosen by the other party on the grounds that such Appraiser does not satisfy the definition of “Appraiser”, then the non-objecting party shall select an alternative Appraiser within ten (10) days of such objection; provided, however, that if a party does not raise any objection within five (5) days after notification of the identity of the other party’s Appraiser, then such Appraiser shall be deemed to satisfy the definition of “Appraiser”.  Each party shall be solely responsible for paying the cost and expenses of their respective Appraiser.  The parties shall use their reasonable best efforts to cause the Appraisers to make their own determination as to the fair market value of the Assets within thirty (30) days after both Appraisers have been appointed (the “Appraisal Period”). 
(ii)    If there is a difference of three percent (3%) or less between the Appraisers’ respective determinations of the fair market value of the Assets, then the fair market value shall be the average of the two (2) appraisals.
(iii)    If the difference between the Appraisers’ respective determinations of the fair market value of the Assets is in excess of three percent (3%), then the two Appraisers shall promptly select a third Appraiser (for the avoidance of doubt, who satisfies the definition of “Appraiser”) who shall determine the fair market value of the Assets.  Immediately following receipt of the valuation from the third Appraiser, the average of all three values shall be calculated and the Appraiser’s valuation that is furthest from said average shall be discarded from the calculation process, and the average of the remaining value determinations shall be deemed the fair market value for the purposes hereof; provided, however, that if the difference among all three appraisals is identical in terms of value, then such fair market value shall be the average of such three appraisals. 
(iv)    If either party fails to appoint its Appraiser within ten (10) days of the expiration of the Value Negotiation Period (or, in the event that a reasonable objection is made to a party’s chosen Appraiser pursuant to clause (d)(i), such party does not select an alternative Appraiser within 10 days), the determination of value made by the Appraiser selected by the other party within such period shall be used to determine the fair market value of the Assets.  If both parties fail to appoint their Appraisers within ten (10) days of the expiration of the Value Negotiation Period, then the Initiating Party’s Fair Market Value shall be deemed the fair market value.
(v)    In the event a third Appraiser is necessary, such Appraiser shall be chosen within ten (10) days after the comparison of the determination of value of the first two Appraisers.
(vi)    In each instance where two Appraisers select a third Appraiser, the first two Appraisers shall share with the third Appraiser all documents, research and other information acquired by them with respect to the Assets.  Furthermore, each of the Initiating Party and the Notice Recipient will instruct and cause their respective Appraiser to provide the third Appraiser with such information as is reasonably requested by such third Appraiser in connection with its analysis of the calculations, assumptions and conclusions drawn by the first two Appraisers, respectively. Additionally, the fees and expenses of the third Appraiser, if necessary, shall be paid equally by the Members.
(vii)    Notwithstanding anything set forth herein to the contrary, in all cases, the determination of Fair Market Value shall be calculated to be as of the end of the month immediately preceding the month of the date of the Option Notice and shall take into account all assets and liabilities of the Company (including, without limitation, the Property Companies and the Assets) and existing contingent liabilities which have been reflected in the most recent financial statements of the Company or will most likely be reflected in the financial statements for the year in which the Option Price shall be paid.  Furthermore, the valuations shall be based upon an all-cash sale basis for the fee simple or ground leasehold, as applicable, interest of the Properties without reduction for any lien or encumbrance against the Properties. 
(viii)    If a party does not use reasonable efforts to cause its Appraiser to make its determination as to the fair market value of the Assets within the Appraisal Period pursuant to clause (d)(i) and as a result of such failure such Appraiser does not submit its determination of fair market value prior to the end of the Appraisal Period, then fair market value shall be deemed to be the fair market value submitted by the Appraiser which timely submitted its determination.  
(ix)    The determination of the Fair Market Value determined in accordance with the foregoing procedures shall be final and binding upon the parties, absent manifest error.
(e)    Closing.
(iv)    The parties shall work together in good faith to close the contemplated transaction (the “Option Closing”) during the Option Closing Period as defined below), but in no event earlier than the beginning of or later than the expiration of the Option Closing Period.  In the case of a Put Option pursuant to Section 3.8(a)(iii), the Option Closing shall occur simultaneously with the closing of the Qualified IPO and in the case of a Call Option, the Option Closing shall occur simultaneously with the closing of the spin-off.  The actual date of the Option Closing is hereinafter referred to as the “Option Closing Date”.  NS Managing Member shall have the right, in its sole and absolute discretion, to select or accelerate the Option Closing Date within the Option Closing Period and Chatham Managing Member acknowledges and agrees that it shall proceed with the Option Closing on the date so chosen by NS Managing Member, provided that NS Managing Member shall be required to give Chatham Managing Member no less than ten (10) days prior notice of the Option Closing Date.  In the event the Option Closing shall occur, such closing shall be on the terms set forth on Schedule F attached hereto. 
(v)    The “Option Closing Period” means:
		
	1)
	In the case of a Put Option pursuant to Section 3.8(a)(i) or (ii), the period commencing on the earliest of the date when (i) the Notice Recipient delivers a Value Acceptance Notice, (ii) the parties otherwise agree upon a fair market value, or (iii) the Appraisers determine fair market value in accordance with Section 3.8(d) (such date, the “FMV Determination Date”), and ending sixty (60) days thereafter.

		
	2)
	In the case of a Put Option pursuant to Section 3.8(a)(iii), the period commencing on the date when NS Managing Member makes a Qualified IPO Demand and ending one (1) year thereafter. 

		
	3)
	In the case of a Call Option, the period commencing on the FMV Determination Date and ending on the first anniversary of the date when NS Managing Member delivers the Call Notice.

(vi)    Notwithstanding anything set forth in this Agreement to the contrary, at any time prior to the Option Closing Date, the Initiating Party may revoke its Option Notice by sending the Notice Recipient a revocation notice. Any such revocation notice shall have the effect of (i) making the revoked Option Notice void ab initio, and (ii) reviving the respective options (i.e., the Put Option or the Call Option, as the case may be) without, however, in anyway limiting or waiving any other rights any party may have either at law or in equity with respect to the Put Option, the Call Option, or otherwise.
(f)    Acknowledgement.  The Members acknowledge and agree the following with respect to the put/call process set forth in this Section 3.8: (i) concurrently with the delivery of the Option Notice under this Agreement, the Initiating Party shall be required to deliver an Option Notice under the Ink III LLC Agreement; (ii) in the event either Member fails to comply with any obligation under the put/call process set forth in Section 3.8 of the Ink III LLC Agreement, then such failure shall be deemed a default by such Member under this Section 3.8 (i.e., a Member shall not be permitted to consummate the put/call process contemplated by this Section 3.8 unless, concurrently therewith, it is consummating the put/call process contemplated by Section 3.8 of the Ink III LLC Agreement); and (iii) the put/call process contemplated by this Section 3.8 shall closing simultaneously with the put/call process contemplated by Section 3.8 of the Ink III LLC Agreement).
ARTICLE III.     
 
GENERAL GOVERNANCE
Section 3.1    Other Ventures.
(l)    It is expressly agreed that each Member, and any Affiliates, officers, directors, trustees, managers, stockholders, members, partners or employees of such Member, may engage in other business ventures of every nature and description, whether or not in competition with the Company, independently or with others, and neither the Company nor the other Members shall have any rights in and to any independent venture or activity or the income or profits derived therefrom; the pursuit of other ventures and activities by any such Person is hereby consented to by each Member and shall not be deemed wrongful or improper.
(m)    Nothing in this Agreement shall be construed so as to prohibit any Member or its respective Affiliates, officers, directors, managers, stockholders, members, partners or employees from owning, operating or investing in any business of any nature and description, independently or with others and no Member need disclose its intention to make any such investment to the other, nor advise the Company of the opportunity presented by any such prospective investment. 
(n)    Notwithstanding the foregoing and without limiting Section 12.17, in the event that any Member receives an opportunity directly related to any Property, such Member shall first offer such opportunity, to the extent relating to any Property, to NS Managing Member and Chatham Managing Member on behalf of the Company.  If either NS Managing Member or Chatham Managing Member (i) declines on behalf of the Company to participate in such opportunity or (ii) is deemed to decline on behalf of the Company to participate in such opportunity as a result of a failure to approve participation by the Company within 10 Business Days of such offer, but either Chatham Managing Member or NS Managing Member, as applicable, as the non-presenting Member wishes to participate in such opportunity in its own capacity, Chatham Managing Member or NS Managing Member, as applicable and the presenting Member shall participate in such opportunity on such basis as they shall agree or, in the absence of such agreement, in proportion to their then equity percentages in the Company.  If the Company and each Member thereof rejects such opportunity, the presenting Member may exploit such opportunity in any manner it sees fit, provided that the presenting Member is not provided materially more favorable terms in the aggregate with respect to such opportunity than were presented to the Company, or the non-presenting Member in connection with their potential participation.
Section 3.2    Information.  
(e)    Chatham Managing Member shall deliver to NS Managing Member, by not later than the (i) eighth (8th) day of each month a preliminary profit and loss statement in the form attached hereto as Schedule L showing the results of operation of the Company and the Properties for the prior month and the year to date, with a comparison to the budgets contained in the Operating Budget and the then-approved Business Plan and to prior year results (a “P&L Statement”) (it being acknowledged and agreed that the Operating Budget shall initially be based on the Final Operating Budget (as such term is defined in the Hotel Management Agreements) and shall then incorporate any additional costs and expenses of the Company not included in the Final Operating Budget); and (ii) twelfth (12th) business day of each month: (1) a final P&L Statement and (2) a current balance sheet in the form attached hereto as Schedule M.  Chatham Managing Member shall also deliver to NS Managing Member, by not later than the twelfth (12th) day of each quarter quarterly forecasts for gross revenues, operating expenses, and Profit or Losses for the remainder of the Fiscal Period.  In addition to the foregoing, Chatham Managing Member shall deliver to NS Managing Member, by not later than the thirtieth (30th) day after the close of each Fiscal Year, (a) a Profit and Loss statement showing the results of operation of the Company and the Properties for such Fiscal Year; (b) a balance sheet for the Company and the Properties as of the close of such Fiscal Year; and (c) the gross revenues and operating expenses for such Fiscal Year.  
(f)    NS Managing Member may cause Accountants selected by NS Managing Member to conduct an audit of the books of account and all other records relating to or reflecting the operation of the Company and the Properties and Chatham Managing Member agrees to cooperate with such accountant so as to allow such accountant to perform such audit and/or deliver audited financial statements to NS Managing Member within ninety (90) days after the end of each Fiscal Year.  Costs of such audit and of the audited financial statements or any other reports prepared by such accountant, if and when requested by NS Managing Member, will be an expense borne by the Company.
(g)    At NS Managing Member’s request, Chatham Managing Member will further deliver or cause to be delivered such additional financial reports as may be reasonably requested by NS Managing Member or required by third parties.  All reasonable costs in producing such additional financial reports will be borne by the Company.
(h)    At NS Managing Member’s request, Chatham Managing Member shall meet with NS Managing Member via conference call or in person to discuss the operating results of the Company and the Properties on a quarterly basis and will comply with all reasonable requests to otherwise meet with NS Managing Member from time to time to discuss other issues with respect to the Company or the Properties.  
Section 3.3    Access.  The Company shall, and shall cause its Subsidiaries, Officers, directors, trustees, members, employees, auditors and other agents to (a) afford the Officers, employees, auditors and other agents of the Members during normal business hours and upon reasonable notice reasonable access to its officers, employees, auditors, legal counsel, properties, offices, plants and other facilities and to all books and records and (b) afford each Member the opportunity to discuss the Company’s affairs, finances and accounts with the Officers or the Managing Member from time to time as each such Member may reasonably request without creating an undue burden on the Company, including, without limitation, but in particular, upon notice that a vote is required with respect to a Major Decision; provided, that the Company shall not be required to afford Chatham Managing Member such opportunity from and after the occurrence of a Termination Event except with respect to a Post-Termination Major Decision.  
Section 3.4    Affiliate Transactions.  
(i)    Neither the Company nor any Property Company shall enter into any agreement for the performance of any service or activity, or for the purchase of any item, with an Affiliate of a Member (other than the Hotel Management Agreements with Island Hospitality Management), without first receiving the prior written approval of the Members, which approval may be withheld in each such Member’s sole and absolute discretion; provided, that, from and after the occurrence of a Termination Event, the prior written approval of Chatham Managing Member shall no longer be required so long as any such arrangement is on an arms’ length basis.
(j)    Notwithstanding anything set forth in Section 3.2 or Section 3.6 hereof to the contrary, a Member, acting alone and on behalf of the Company and any then existing Property Companies, may enforce and make all decisions under or in connection with agreements between the Company or any Property Company, on the one hand, and the other Member and/or its Affiliates, on the other hand, provided that for purposes of this Section 4.4(b), Island Hospitality Management shall be considered an Affiliate of Chatham Managing Member.
ARTICLE IV.     
 
TRANSFERS OF INTERESTS
Section 4.1    Restrictions on Transfer.  
(i)    No Transfer shall be made by either Chatham Managing Member or NS Managing Member with respect to all or any portion of its Interest without the prior written approval of the non-Transferring Member unless such Transfer is (i) pursuant to Section 3.7 of this Agreement, (ii) pursuant to Section 3.8 of this Agreement or (iii) a Permitted Transfer.  No Member will have the ability to directly or indirectly syndicate its Interest to unaffiliated co-investors.
(j)    The Company, each Member, the Managing Member, the Officers and any other Person or Persons having business with the Company need only deal with Members who are admitted as Members or as additional or substitute Members of the Company, and they shall not be required to deal with any other Person by reason of a Transfer by a Member.  In the absence of a transferee of a transferring Member’s Percentage Interest being admitted as a Member as provided herein, any payment to a Member shall release the Company and the Members of all liability to any other Persons who may be interested in such payment by reason of an assignment by such Member.
(k)    Each transferee, as a condition to its admission as a Member, shall execute and deliver to the Company such instruments (including a counterpart of this Agreement), in form and substance reasonably satisfactory to the Managing Member, as the Managing Member shall reasonably deem necessary or desirable to confirm the agreement of such transferee to be bound by all the terms and provisions of this Agreement (as it may be amended in connection with the admission of such transferee as a Member).  The Members agree to amend this Agreement to the extent necessary to reflect the Transfer and admission of the new Member and to continue the Company without dissolution.  Upon execution of such instruments, the transferee shall be admitted to the Company as a Member.  Immediately following the admission of the transferee to the Company as a Member, any Person who has thereby transferred all of its ownership interest in the Company shall cease to be a Member of the Company.  Except as set forth herein, any transferee who is admitted to the Company as a Member shall succeed to the rights and powers, and be subject to the restrictions and liabilities, of the transferor Member to the extent of the Percentage Interest transferred. 
(l)    In the event that the Members determine to sell all but not less than all of their Percentage Interest in the Company (including pursuant to Section 3.7 and Section 3.8 hereof), the Tax Matters Member will propose a schedule (the “Allocation Schedule”) to the Members of the Company allocating the expected purchase price in accordance with Section 1060 of the Code.  Upon the affirmative vote of each of the Members of the Company (or, from and after the occurrence of a Termination Event, NS Managing Member), such proposed allocation will be the Allocation Schedule that will be proposed by the Members in connection with the potential sale and, if no objection is made to such Allocation Schedule by the third party purchaser of the Percentage Interests, will be final and binding in connection with such sale upon the Members.
Section 4.2    Non-Permitted Transfers.  
(h)    Any purported Transfer of all or any portion of a Member’s Percentage Interest of the Company or any economic benefit or other interest therein not in compliance with Section 5.1 shall be null and void ab initio, regardless of any notice provided to any of the parties hereto, and shall not create any obligation or liability of any of the parties hereto to the purported transferee, and any Person purportedly acquiring all or any portion of any Percentage Interest or any economic benefit or other interest therein transferred not in compliance with Section 5.1 shall not be entitled to admission to the Company as a substitute Member.  In the event of any direct or indirect Transfer of an interest in a Member, other than a Transfer permitted under Article V hereof, the Member that has made such Transfer shall not be necessary for any Major Decision until such Transfer has been rescinded or otherwise nullified, except that the consent of such Member shall still be required to amend this Agreement.
(i)    In the case of an attempted Transfer of all or any portion of any Percentage Interest of the Company or any economic benefit or other interest therein that is not in compliance with Section 5.1, the parties engaging or attempting to engage in such Transfer shall indemnify and hold harmless the other parties hereto and their respective officers, directors, affiliates, members, partners and employees from all cost, liability and damage that any of such indemnified persons may incur (including, without limitation, incremental tax liability and attorneys’ fees and expenses) as a result of such Transfer or attempted Transfer and the enforcement of this indemnity.
(j)    No Member, including any assignee or successor in interest of any Member, shall Transfer all or any portion of its Percentage Interest of the Company or any economic benefit or other interest therein if such Transfer would cause the Company to be treated as a “publicly traded partnership” within the meaning of Code Section 7704 and the Regulations promulgated thereunder.
ARTICLE V.     
 
ALLOCATIONS
Section 5.1    General Rules.
(k)    Allocations of Profits and Losses.  Except as otherwise provided in this Article VI, Profits and Losses for any Fiscal Period shall be allocated among the Members in such manner that, as of the end of such Fiscal Period, the respective Capital Accounts of the Members shall be equal to the respective amounts that would be distributed to them, determined as if the Company were to (i) liquidate the assets of the Company for an amount equal to their Gross Asset Value and (ii) distribute the proceeds of liquidation pursuant to Section 10.3.
Section 5.2    Special Allocations.
(a)  Minimum Gain Chargeback.  Except as otherwise provided in Treasury Regulations Section 1.704-2(f), notwithstanding any other provision of this Article 6, if there is a net decrease in Partnership Minimum Gain during any Fiscal Year, each Member shall be specially allocated items of Company net income and gain for such Fiscal Year (and, if necessary, subsequent Fiscal Years) in an amount equal to such Member’s share of the net decrease in partnership minimum gain, determined in accordance with Treasury Regulations Section 1.704-2(g).  Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto.  The items to be so allocated shall be determined in accordance with Treasury Regulations Sections 1.704-2(f)(6) and 1.704-2(j)(2).  This Section 6.2(a) is intended to comply with the minimum gain chargeback requirement in Treasury Regulations Section 1.704-2(f) and shall be interpreted consistently therewith.

(b)  Partner Minimum Gain Chargeback.  Except as otherwise provided in Treasury Regulations Section 1.704-2(i)(4), notwithstanding any other provision of this Article 6, if there is a net decrease in partner nonrecourse debt minimum gain (as defined in Treasury Regulations Section 1.704-2(i)(2)) attributable to a partner nonrecourse debt during any Fiscal Year, each Member who has a share of the partner nonrecourse debt minimum gain attributable to such partner nonrecourse debt, determined in accordance with Treasury Regulations Section 1.704-2(i)(5), shall be specially allocated items of net income and gain for such Fiscal Year (and, if necessary, subsequent Fiscal Years) in an amount equal to such Member’s share of the net decrease in partner nonrecourse debt minimum gain attributable to such partner nonrecourse debt, determined in accordance with Treasury Regulations Section 1.704-2(i)(4).  Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto.  The items to be so allocated shall be determined in accordance with Treasury Regulations Section 1.704-2(i)(4) and 1.704-2(j)(2).  This Section 4.2(b)(2)(b) is intended to comply with the minimum gain chargeback requirement in Treasury Regulations Section 1.704-2(i)(4) and shall be interpreted consistently therewith.

(c)  Qualified Income Offset.  In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (d)(5) or (d)(6), items of Company net income and gain shall be specially allocated to each such Member in an amount and manner sufficient to eliminate, to the extent required by the Treasury Regulations, the deficit Capital Account balance of such Member as quickly as possible, provided that an allocation pursuant to this Section 6.2(c) shall be made if and only to the extent that such Member would have a deficit Capital Account balance after all other allocations provided for in this Article 6 have been tentatively made as if this Section 6.2(c) were not a term of this Agreement. This Section 6.2(c) is intended to constitute a “qualified income offset” provision as described in Treasury Regulations Section 1.704-1(b)(2)(ii)(d) and shall be interpreted consistently therewith.

(d)  Partner Nonrecourse Deductions.  Any partner nonrecourse deductions for any Fiscal Year shall be specially allocated to the Member who bears the economic risk of loss with respect to the partner nonrecourse debt to which such partner nonrecourse deductions are attributable in accordance with Treasury Regulations Section 1.704-2(i)(1).

 (e)    Nonrecourse Deductions.  Nonrecourse Deductions shall be allocated among the Members in accordance with their Percentage Interests.

 (f)    Allocation of Nonrecourse Debt.  For purposes of Treasury Regulations Section 1.752-3(a), the Members agree that Nonrecourse Liabilities of the Company in excess of the sum of (i) the amount of Partnership Minimum Gain and (ii) the total amount of Nonrecourse Built in Gain shall be allocated among the Members in accordance with their Percentage Interests.

(g)    Section 754 Adjustment.  The Members acknowledge that NS Managing Member, as Tax Matters Member, will cause the Company to make an election under Section 754 of the Code with respect to the Company’s taxable year that will end on the Effective Date in accordance with Treasury Regulations section 1.708-1(b)(3)(ii) as a result of a “technical termination” of the Company as a partnership under Section 708(b)(1)(B) of the Code and Treasury Regulations section 1.708-1.  As a result of such election, the adjustment to the basis of partnership property shall constitute an adjustment to such basis with respect to NS Managing Member only, as the transferee of an interest in the Company, as required by Section 743(b) of the Code and the Treasury Regulations thereunder.

(h)    Priming Capital Contribution Returns.  Distributions in respect of Priming Capital Contribution Returns will be treated as payments to a partner for the use of capital pursuant to Section 707(c) of the Code.

Section 5.3    Other Allocation Rules.  
(c)    For purposes of determining the Profits, Losses or other items allocable to any Fiscal Period, Profits, Losses and such other items shall be determined on a daily, monthly or other basis as determined by the Tax Matters Member in its reasonable discretion using any permissible method under Code Section 706 and the Regulations thereunder.  
(d)    The Members are aware of the United States federal income tax consequences of the allocations made by this Article VI and hereby agree to be bound by the provisions of this Article VI in reporting their shares of Company income and loss for income tax purposes.
(e)    All items of income, gain, loss, deduction, or credit and any other allocations not otherwise provided for shall be allocated among the Members as determined by the Tax Matters Member in its reasonable discretion.
(f)    If a Member transfers all or a portion of its Percentage Interest during any Fiscal Period, then Profits, Losses, each item thereof and all other items attributable to the transferred interest for such Fiscal Period shall be divided and allocated between the transferor and the transferee by taking into account their varying interests in the Company during the Fiscal Period in accordance with Section 706(d) of the Code, using any conventions permitted by law and selected by the Tax Matters Member in its reasonable discretion.
Section 5.4    Tax Allocations; Code Section 704(c).  
(f)    Subject to Section 6.4(b) and (c), for each Fiscal Year, items of income, deduction, gain, loss and credit shall be allocated for tax purposes among the Members to reflect the amounts which have been credited or debited to the Capital Account of each such Member for such Fiscal Year and prior Fiscal Years.
(g)    In accordance with Code Section 704(c) and the Regulations thereunder, items of income, gain, loss, deduction and credit with respect to any property contributed to the capital of the Company shall, solely for tax purposes, be allocated among the Members so as to take account of any variation between the adjusted tax basis of such property at the time of contribution to the Company for federal income tax purposes and its initial Gross Asset Value at the time of contribution using a method permitted by applicable Regulations under Code Section 704(c), as determined by the Tax Matters Member in its reasonable discretion.
(h)    In the event the Gross Asset Value of any Asset is adjusted in accordance with paragraph (b) of the definition of Gross Asset Value hereof, subsequent allocations of items of income, gain, loss, deductions or credit with respect to such asset shall take into account any variation between the adjusted tax basis of such asset for federal income tax purposes and its Gross Asset Value in the same manner as under Code Section 704(c) and the Regulations thereunder.
(i)    Any elections or other decisions relating to allocations for tax purposes, basis adjustments or other tax matters shall be made by the Tax Matters Member in its reasonable discretion.  Allocations pursuant to this Section 6.4 are solely for purposes of federal, state and local taxes and shall not affect, or in any way be taken into account in computing, any Member’s Capital Account, share of Profits or Losses, or other items or distributions pursuant to any provision of this Agreement.
(j)    Notwithstanding anything in this Agreement to the contrary, the Tax Matters Member shall not make any determinations or elections, or fail to make any elections reasonably requested by the Managing Member, under this Article VI or the definition of “Depreciation” that could reasonably be expected to disproportionately, materially and adversely affect Chatham Managing Member or Chatham REIT without Chatham Managing Member’s prior written consent. For the avoidance of doubt, it is agreed by the Members that NS Managing Member, as Tax Matters Member, shall cause the Company to make an election under Section 754 of the Code with respect to the Company’s taxable year that will end on the Effective Date in accordance with Treasury Regulations section 1.708-1(b)(3)(ii) as a result of a “technical termination” of the Company as a partnership under Section 708(b)(1)(B) of the Code and Treasury Regulations section 1.708-1.
Section 5.5    Compliance with Code Section 704(b).   The allocation provisions contained in this Article 6 are intended to comply with Code Section 704(b) and the Treasury Regulations promulgated thereunder, and shall be interpreted and applied in a manner consistent therewith.
ARTICLE VI.     
 
DISTRIBUTIONS AND EXPENSES
Section 6.1    Distributions of Available Cash.  
(a)    Available Cash from Operations.  During the period commencing on the Effective Date and ending upon the dissolution of the Company pursuant to the provisions of Article X, NS Managing Member shall cause the Company to make distributions of Available Cash from Operations in accordance with the provisions of this Article VII in the following order of priority and as follows:  

(i)    first, one hundred percent (100%) to the Members who have made Priming Capital Contributions (and in accordance with the priorities and provisions of Section 2.2(d)(ii)) until each such Member has received distributions under this clause (i) and Section 7.1(b)(i) equal to such Priming Capital Contribution plus any accrued and unpaid Priming Capital Contribution Return;  

(ii)    second, pro rata to the Members in accordance with their respective Percentage Interests.

(b)    Available Cash From Capital Event.  In the event that a Capital Event occurs, NS Managing Member shall cause the Company to make distributions of the resulting Available Cash From Capital Event in accordance with the provisions of this Article VII in the following order of priority and as follows: 

(i)    first, one hundred percent (100%) to the Members who have made Priming Capital Contributions (and in accordance with the priorities and provisions of Section 2.2(d)(ii)) until each such Member has received distributions under this clause (b)(i) and Section 7.1(a)(i) equal to such Priming Capital Contribution plus any accrued and unpaid Priming Capital Contribution Return;  

(ii)    second, pro rata to the Members in accordance with their respective Percentage Interests until the NS Operating Company Managing Members have received an aggregate Internal Rate of Return of fifteen percent (15%); 

(iii)    third, (A) fifteen percent (15%) to Chatham Managing Member and (B) eighty-five percent (85%) to the Members in accordance with their respective Percentage Interests until the NS Operating Company Managing Members have received an aggregate Internal Rate of Return of twenty percent (20%) (the aggregate percentage of a distribution to which Chatham Managing Member is entitled pursuant to this Section 7.1(b)(iii) (i.e., 15% plus (Chatham’s Percentage Interest multiplied by 85%), the “Section 7.1(b)(iii) Aggregate Percentage”);

(iv)    fourth, (A) twenty percent (20%) to Chatham Managing Member and (B) eighty percent (80%) to the Members in accordance with their respective Percentage Interests until the NS Operating Company Managing Members have received an aggregate Internal Rate of Return of twenty-five percent (25%) (the aggregate percentage of a distribution to which Chatham Managing Member is entitled pursuant to this Section 7.1(b)(iv) (i.e., 20% plus (Chatham’s Percentage Interest multiplied by 80%), the “Section 7.1(b)(iv) Aggregate Percentage”);

(v)    fifth, (A) thirty percent (30%) to Chatham Managing Member and (B) seventy percent (70%) to the Members in accordance with their respective Percentage Interests.

(c)    Notwithstanding the foregoing provisions of this Section 7.1, in the event a Promote Forfeiture Event occurs, then, at the option of NS Managing Member, the Promote payable to Chatham Managing Member under this Agreement shall be forfeited and any distributions that would otherwise have been made in respect thereof shall instead be distributed to the Members in proportion to their current Percentage Interests for purposes of determining the disposition thereof under this Section 7.1; provided, however, the foregoing shall not limit any other right or remedy available to NS Managing Member pursuant to the other provisions of this Agreement, the Chatham Guaranty or at law or in equity (including, without limitation, to the extent appropriate, injunctive or other equitable relief) as a result of the occurrence of such event constituting a Promote Forfeiture Event.  

(d)    NS Managing Member shall cause the Company to make distributions of Available Cash to the Members at such time or times as is reasonably determined by NS Managing Member in its reasonable discretion.  Nothing contained in this Agreement shall in any manner be construed to imply that any Member has any claim or right under this Agreement to require that distributions of Available Cash or distributions on winding up of the Company be made at any particular time or in any particular amount.  The Members further agree that in determining whether to make a distribution of such Available Cash or other distributions to the Members at any time, or in determining the amount of any Available Cash or other distributions, NS Managing Member shall not have any fiduciary, or trustee or other obligation or duty to any Member other than a contractual obligation or duty pursuant to the terms of this Agreement.

Section 6.2    Amounts Withheld.  All amounts withheld or paid pursuant to the Code or any provisions of state, local or foreign tax law with respect to any payment, distribution, allocation or other consideration paid to the Members, including in connection with a contribution of assets to the Company by a Member, shall be treated as amounts paid or distributed, as the case may be, to the Members with respect to which such amount was withheld or paid pursuant to this Section 7.2 for all purposes under this Agreement.  The Company is authorized to withhold or pay, when required under applicable law, from payments, distributions, or other consideration paid to Members, and with respect to allocations to the Members, and to pay over to any federal, state, local or foreign government any amounts required to be so withheld or paid pursuant to the Code or any provisions of any federal, state, local or foreign law, and shall allocate any such amounts to the Members with respect to which such amounts were withheld or paid.
Section 6.3    Expenses.  Except as otherwise provided in this Agreement, the Company will be responsible for all third party expenses of the Company.  Subject to Section 3.1(c), each Member shall otherwise be responsible for all costs and expenses incurred by such Member in the performance of its obligations under this Agreement.
Section 6.4    Promote Overpayments.  
(a)    If, as of any date of determination (which must be the date of a determination by NS Managing Member to cause the Company to make a distribution in respect of a Capital Event), Chatham Managing Member has received distributions in respect of the Promote which, together with any prior distributions in respect of the Promote (calculating the Promote and distributions on a cumulative basis of distribution on, as of and for the period through such date of determination) are determined by NS Managing Member in accordance with this Agreement to be in excess of the actual cumulative amount to which Chatham Managing Member would have been entitled under Section 7.1 if the Promote were recalculated as of such date of determination (any such excess distributions, the “Excess Promote Amount”), then within thirty (30) days after the occurrence of such distribution in respect of a Capital Event, NS Managing Member shall notify Chatham Managing Member, setting out in reasonable detail the basis for such determination, that Chatham Managing Member shall repay such Excess Promote Amount to the Company on or before the date which is fifteen (15) days after receipt of notice from NS Managing Member setting forth the amount of such Excess Promote Amount.  Upon payment of such Excess Promote Amount to the Company, NS Managing Member shall have the right to determine to (x) use such Excess Promote Amount to fund obligations of the Company and/or to fund the Working Capital Reserve (including, without limitation, using such Excess Promote Amount in lieu of issuing a Capital Call Notice to the Members), or (y) to the extent that such Excess Promote Amount constitutes Available Cash, to re-distribute such Available Cash to the Members (including Chatham Managing Member) pursuant to the then applicable provisions of Section 7.1.  

(b)    If Chatham Managing Member shall fail to repay the Excess Promote Amount that is due to the Company, then NS Managing Member shall be deemed to have made a loan to Chatham Managing Member (such loan, a “Promote Payment Loan”), on the date such payment was due, in an amount equal to the Excess Promote Amount, plus interest accruing from the date such payment was originally due from Chatham Managing Member on such amount at a fixed per annum rate (compounding monthly) equal to the lesser of (x) twenty percent (20%) per annum and (y) the highest rate permitted by applicable law, which Promote Payment Loan shall (i) be payable in whole or in part by Chatham Managing Member without premium or penalty, (ii) be payable in full immediately upon demand from NS Managing Member, and (iii) be secured by a lien upon the economic interest (i.e., the right to receive distributions and other monetary payments provided for in this Agreement) of Chatham Managing Member in the Company (and the parties intend hereby to create a security interest), which lien will automatically attach to such limited liability company interest without the necessity of further action; provided, however, upon request made by NS Managing Member, Chatham Managing Member will execute and deliver any document, instrument, agreement or financing statement in favor of NS Managing Member that is necessary to evidence or perfect such Promote Payment Loan and lien and is reasonable in form and content and, in connection therewith, Chatham Managing Member hereby authorizes the filing of Uniform Commercial Code financing statements in favor of NS Managing Member that is necessary to evidence the foregoing lien and is reasonable in form and content.  All payments made on account of a Promote Payment Loan shall be allocated first to accrued interest and second to principal.

(c)    If NS Managing Member is deemed to have made a Promote Payment Loan then in connection with the distribution of Available Cash from Operations or Available Cash from Capital Event, if there is an outstanding Promote Payment Loan to Chatham Managing Member pursuant to the provisions hereof, all distributions under this Article VII or Article X that would otherwise be payable to Chatham Managing Member will be deemed distributed to Chatham Managing Member but will be paid instead to NS Managing Member (and/or used in the manner set forth in the last sentence of Section 7.4(a)) until the Promote Payment Loan has been paid in full.  If there is more than one Promote Payment Loan to Chatham Managing Member during the term hereof, the oldest Promote Payment Loan shall be repaid in full first, with any subsequent Promote Payment Loans being repaid in the order same were advanced.

ARTICLE VII.     
 
OTHER TAX MATTERS
Section 7.1    Tax Matters Member.  The Company and each Member hereby designate NS Managing Member as the “tax matters partner” for purposes of Code Section 6231(a)(7) (the “Tax Matters Member”).  The Tax Matters Member (after consultation with the Managing Member) shall: (a) cause to be prepared and timely filed by the Company all United States federal, state and local income tax returns of the Company for each year for which such returns are required to be filed, and (b) determine the appropriate treatment of each item of income, gain, loss, deduction and credit of the Company and the accounting methods and conventions under the tax laws of the United States, the several states and other relevant jurisdictions as to the treatment of any such item or any other method or procedure related to the preparation of such tax returns.  Subject to the express provisions of this Agreement, NS Managing Member may in its reasonable discretion cause the Company to make or refrain from making any and all elections permitted by such tax laws, provided that the Tax Matters Member shall not make, or refrain from making any election reasonably requested by the Managing Member, that could reasonably be expected to disproportionately, materially and adversely affect Chatham Managing Member or the Chatham REIT without Chatham Managing Member’s prior written consent. For the avoidance of doubt, it is agreed by the Members that NS Managing Member, as Tax Matters Member, shall cause the Company to make an election under Section 754 of the Code with respect to the Company’s taxable year that will end on the Effective Date in accordance with Treasury Regulations section 1.708-1(b)(3)(ii) as a result of a “technical termination” of the Company as a partnership under Section 708(b)(1)(B) of the Code and Treasury Regulations section 1.708-1.  
Section 7.2    Furnishing Information to Tax Matters Member.  Each Member shall furnish to the Tax Matters Member such information (including information specified in Code Section 6230(e)) as such Tax Matters Member may, at its reasonable discretion, request to permit it to provide the Internal Revenue Service with sufficient information to allow proper notice to the Members in accordance with Code Section 6223 or any other provisions of the Code or the published regulations thereunder which require the Tax Matters Member to obtain information from the Members.
Section 7.3    Tax Claims and Proceedings.  In respect of any income tax audit of any tax return of the Company, the filing of any amended return or claim for refund in connection with any item of income, gain, loss, deduction or credit reflected on any income tax return of the Company, or any administrative or judicial proceedings arising out of or in connection with any such audit, amended return, claim for refund or denial of such claim, (a) all expenses reasonably incurred by the Tax Matters Member in connection therewith shall be expenses of the Company, (b) the Tax Matters Member shall promptly deliver to each other Members a copy of all notices, communications, reports and writings received from the IRS relating to or potentially resulting in an adjustment of Company items, shall promptly advise each of the other Members of the substance of any conversations with the IRS in connection therewith and shall keep the other Members advised of all developments with respect to any proposed adjustments which come to its attention; (c) the Tax Matters Member shall (i) provide the other Members with a draft copy of any correspondence or filing to be submitted by the Company in connection with any administrative or judicial proceedings relating to the determination of Company items at the Company level reasonably in advance of such submission, (ii) incorporate all reasonable changes or comments to such correspondence or filing requested by the other Members and (iii) provide the other Members with a final copy of correspondence or filing, (d) the Tax Matter Member will provide each Member with notice reasonably in advance of any meetings or conferences with respect to any administrative or judicial proceedings relating to the determination of Company items at the Company level (including any meetings or conferences with counsel or advisors to the Company with respect to such proceedings) and each Member shall have the right to participate, at its sole cost and expense, in any such meetings or conferences.  Notwithstanding anything in this Agreement to the contrary, the Tax Matters Member shall not enter into any settlement agreement that is binding upon the other Members with respect to the determination of Company items at the Company level without the prior written consent of the other Members.  The Tax Matters Member shall use commercially reasonable efforts to provide tax returns to all Members at least 60 days prior to the return due date (inclusive of automatic extensions) if the Managing Member has provided the requisite information to the Tax Matters Member or the Company’s accountants reasonably in advance of such date.
Section 7.4    Books and Records.  The books and records of the Company shall reflect all Company transactions and shall be appropriate and adequate for the Company’s business.  The books and records of the Company shall include a record of each transfer of participating interests of the Company.  The Fiscal Year of the Company for financial reporting and for federal income tax purposes shall be the calendar year.  All books and records of the Company shall be maintained at any office of the Company or at the Company’s principal place of business in the United States, and each Member, and any duly authorized representative, shall have access to them at such office of the Company and the right to inspect and copy them at reasonable times.  The Company’s books of account shall be kept on an accrual basis or as otherwise provided by the Managing Member and otherwise in accordance with generally accepted accounting principles, consistently applied, except that for income tax purposes such books shall be kept in accordance with applicable tax accounting principles (including the Regulations).
Section 7.5    Chatham Managing Member Tax Protection.  If requested by Chatham Managing Member, the Company shall cooperate with Chatham Managing Member to arrange a special allocation of liabilities of the Company to Chatham Managing Member in such amount or amounts so as to maintain or increase the amount of partnership liabilities allocated to Chatham Managing Member for purposes of Section 752 of the Code, including without limitation, allowing Chatham Managing Member the opportunity, at its option, either (i) to enter into a “bottom dollar guarantee” in a form designated by Chatham Managing Member of any liability of the Company identified by Chatham Managing Member or (ii) to enter into a “deficit restoration obligation” pursuant to which Chatham Managing Member would enter into a written obligation to restore part or all of its deficit capital account in the Company upon the occurrence of certain events.  If Chatham Managing Member requests to enter into a “deficit restoration obligation” pursuant to the preceding sentence, the Members shall agree to amend this Agreement to include any provisions Chatham Managing Member reasonably determines are necessary to cause an allocation of liabilities to Chatham Managing Member under Section 752 of the Code, provided that any such amendments shall not harm any Member or otherwise impair any Member’s rights under this Agreement.  A reduction in liabilities of the Company allocated to a Member under Section 752 of the Code shall not be treated as a harm or an impairment for purposes of the preceding sentence.  The Managing Member or NS Managing Member, as applicable, shall notify Chatham Managing Member thirty days prior to taking any action that could be reasonably expected to cause a reduction of the liabilities allocated to Chatham Managing Member under Section 752 of the Code, and the Company shall cooperate with Chatham Managing Member to arrange a special allocation of liabilities of the Company to Chatham Managing Member that is effective prior to taking such action.  For the avoidance of doubt, the provisions of this Section 8.5 shall not require the Company to maintain any level of indebtedness or limit the Company’s ability to dispose of assets.
Section 7.6    Survival.  The provisions of this Article VIII shall survive the termination of the Company (as well as any termination, purchase or redemption of any Member’s Percentage Interest in the Company for any reason whatsoever), and shall remain binding on the Members and all former Members for a period of time necessary to resolve with the appropriate taxing authorities any and all material matters regarding the taxation of the Company and its Members by reason of their percentage interests.
ARTICLE VIII.     
 
REPRESENTATIONS AND WARRANTIES; COVENANTS
Section 8.1    Representations and Warranties of Members.  Each of the Members hereby represents and warrants to the Company and to each of the other Members, as of the Effective Date that: 
(k)    If it is a corporation, a limited liability company or limited partnership, it is duly incorporated or otherwise duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, and if it is a partnership, it is validly constituted and not dissolved, and, in each case, has the power and lawful authority to own its assets and properties and to carry on its business as now conducted. 
(l)    It has the full right, power and authority to enter into, execute and deliver this Agreement and to perform fully its obligations hereunder.  This Agreement has been fully executed and delivered by such Member and, assuming the due execution and delivery by the other parties, constitutes the valid and binding obligation of such Member, enforceable in accordance with its terms, except as (i) such enforceability may be limited by bankruptcy, reorganization or moratorium or other similar laws affecting the enforcement of creditors’ rights generally and (ii) the availability of equitable remedies may be limited by equitable principles of general applicability.
(m)    No approval or consent of any governmental authority or of any other Person is required in connection with the execution and delivery by it of this Agreement and the consummation and performance by such member of the transactions contemplated hereunder, except such as have been obtained and are in full force and effect.
(n)    The execution and delivery of this Agreement by it, the consummation of the transactions contemplated hereunder and the performance by such Member of its obligations under this Agreement, in accordance with the terms and conditions hereof, will not conflict with or result in the breach or violation of any of the terms or conditions of, or constitute (or with notice or lapse of time or both would constitute) a default under, (i) the certificate of incorporation, by-laws, certificate of formation, limited liability company agreement or other constitutive documents of such Member; (ii) any instrument or contract to which such Member is a party or by or to which it or its assets or properties are bound or subject; or (iii) any statute or any regulation, order, judgment or decree of any governmental authority, except, in each case, for such breaches violations or defaults that would not, individually or in the aggregate, materially impair the ability of such Member to perform its obligations hereunder.
(o)    It understands that there are substantial risks to an investment in the Company and it has both the sophistication to be able to fully evaluate the risk of an investment in the Company and the capacity to protect its own interests in making such investment.  Such Member fully understands and agrees that the investment in the Company is an illiquid investment.
(p)    It is a QIB or an “accredited investor” within the meaning of the 1933 Act and is able to bear the economic risk of such an investment in the Company for an indefinite period of time, that it has no need for liquidity of this investment and it could bear a complete loss of this investment.  The Member is either (i) a “qualified purchaser” within the meaning of the 1940 Act or (ii) if the Member is an entity formed and is being utilized primarily for the purpose of making an investment in the Company, each beneficial owner of such Member’s securities is such a qualified purchaser.  
(q)    It is acquiring its percentage interests for investment solely for such Member’s own account and not for distribution, transfer or sale to others in connection with any distribution or public offering.  It understands that, irrespective of whether or not the Percentage Interests might be deemed “securities” under applicable laws, the Company is not obligated to register any percentage interests for resale under the 1933 Act or any applicable state securities laws.
(r)    It specifically understands and agrees that no other Member, has made nor will make any representation or warranty with respect to the worthiness, terms, value or any other aspect of the Company, any Percentage Interest or the Business or Properties and it explicitly disclaims any warranty, express or implied, with respect to such matters.  In addition, such Member specifically acknowledges, represents and warrants that (i) it is not relying on any other Member for its own due diligence concerning, or evaluation of, the Company or any related transaction and (ii) that it is not relying on any other Member with respect to tax and other economic considerations involved in an investment in the Company.
(s)    No broker, investment banker, financial advisor or other Person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or commission in connection with the Company based upon arrangements made by or on behalf of such Member.
(t)    There are no actions, suits or proceedings pending, or to the knowledge of such Member threatened against such Member or its Affiliates which, if adversely determined, could materially adversely affect the ability of such Member or its Affiliates to perform its obligations under this Agreement or materially adversely affect the Percentage Interest of any other Member.
Section 8.2    ERISA Representation.  Each of the Members represents, warrants and covenants to each other Member and to the Company that no portion of the assets being used by it to purchase and hold its percentage interests constitute assets of a plan within the meaning of Section 3(32) of ERISA.
Section 8.3    AML/OFAC Compliance.
(a)    Each Member hereby represents and warrants to each other Members and to the Company, as of the Effective Date, as follows:
(iv)    To the best of its knowledge, it is in compliance with all applicable anti-money laundering and anti-terrorist laws, regulations, rules, executive orders and government guidance, AML and the OFAC Sanctions Programs, including the reporting, record-keeping and compliance requirements of the Bank Secrecy Act, as amended by the USA PATRIOT Act (collectively, the “BSA/Patriot Act”), and all related applicable Securities and Exchange Commission, self-regulatory organization or other agency rules and regulations, and has internal policies, procedures, internal controls and systems in place that are reasonably designed to ensure such compliance (collectively “AML/OFAC Laws”);
(v)    Neither (1) such Member nor any nor any Affiliate of such Member, nor (2) any person for whom such Member is acting as agent or nominee in connection with this investment is prohibited pursuant to the OFAC Sanctions Programs;
(vi)    Unless disclosed in writing to the other Members on or before the Effective Date, (1) it is not a Senior Foreign Political Figure, or an Immediate Family Member or a Close Associate of a Senior Foreign Political Figure and (2) it is not controlled by a Senior Foreign Political Figure, or an Immediate Family Member or Close Associate of a Senior Foreign Political Figure; 
(vii)    It is not a foreign financial institution or a Person located in a foreign jurisdiction that has been designated by the U.S. Department of the Treasury as being subject to any special measures imposed on such financial institutions and jurisdictions pursuant to Section 311 of the BSA/Patriot Act;
(viii)    It is not a “foreign shell bank” and it is not being used to provide services to a “foreign shell bank”, as that term is defined for purposes of Sections 313 and 319 of the BSA/Patriot Act;
(b)    Each Member hereby covenants to the Company and the other Members as follows:
(iii)    Such Member will not engage in any activities that contravene federal state or international regulations, including all applicable AML/OFAC Laws;
(iv)    Such Member will use reasonable efforts to ensure that the cash or other assets contributed to the Company by such Member will not be directly or indirectly derived from activities that contravene federal, state or international regulations, including applicable AML/OFAC Laws;
(v)    Such Member will not utilize any funds received by the Company for any purpose that contravenes federal, state or international regulations, including applicable AML/OFAC Laws;
(vi)    All funds contributed to or received from the Company by such Member will be wired to or from a bank located in an Approved FATF Country (“Wiring Bank”) where such Member is a customer of the Wiring Bank;
(vii)    All transactions, negotiations, discussions and dealings by such Member in connection with the Company will be in full compliance with all applicable AML/OFAC Laws;
(viii)    Upon receiving a request from the Company or another Member, such Member shall provide such reasonable and non-proprietary and non-confidential information as may be reasonably required by the Company or such other Member to confirm that the representations, warranties and covenants contained in this Section 9.3(b) continue to be true and to comply with all applicable anti-money laundering and anti-terrorist laws, regulations and executive orders;
(ix)    Such Member consents to the disclosure to United States regulators and law enforcement authorities by the Company or any other Member and its Affiliates of such information about such Member as the Company or such other Member or any of its Affiliates reasonably deems necessary or appropriate to comply with applicable anti-money laundering and anti-terrorist laws, regulations and executive orders;
(x)    As a condition to any Transfer of such Member’s direct or indirect interest in the Company, the Company and the other Members have the right to require full compliance with the representations, warranties and covenants contained in this Section 9.3;
(xi)    Such Member will notify the Company and the other Members promptly if there is any change with respect to any of the representations or warranties (or any breach of a covenant) contained in this Section 9.3; and
(xii)    Such Member is a “United States person” for United States federal income tax purposes.
(c)    Each Member hereby acknowledges and agrees that the Company and the other Members have relied on the truthfulness of (and compliance by such Member with) each and every provision of this Section 9.3, and that any breach of such representations, warranties or covenants, including, without limitation, one that causes a breach or violation of, or a failed condition under, any documents by which the Company is bound (such as loan documents), is likely to result in substantial loss for the Company and/or the other Members.
(d)    Each Member hereby acknowledges and agrees that if, following its investment in the Company, the Company or any other Member reasonably believes that such Member has breached any of its representations, warranties or covenants set forth in this Section 9.3, or that any action is otherwise required by law or regulation, the Company and the other Members have the right or may be obligated to freeze or block such Member’s investment in the Company, to prohibit additional investments by such Member in the Company, to segregate the assets constituting such Member’s investment in accordance with applicable AML/OFAC Laws and regulations, to decline any redemption or transfer requests made by or on behalf of such Member, to redeem such Member’s investment, and/or to report any such action to the applicable governmental authorities.  Each Member further acknowledges and agrees that it will have no claim against the Company and/or any other Member or any of their respective Affiliates for any form of damages as a result of any of the foregoing actions.
ARTICLE IX.     
 
DISSOLUTION AND TERMINATION OF THE COMPANY
Section 9.1    Dissolution.  The Company shall be dissolved and its business wound up upon the earliest to occur of any one of the following events, unless the Members vote to continue the life of the Company upon the occurrence of such an event:
(g)    The written determination of the Members to terminate the Company; 
(h)    Twenty-four (24) months after the sale, condemnation or other disposition of all Properties and the receipt of all consideration therefor; or
(i)    The entry of a decree of judicial dissolution of the Company pursuant to the provisions of the Act.
Without limiting the generality of the foregoing, the permitted Transfer of a Member’s Interest will not result in the dissolution of the Company.  Except as otherwise specifically provided in this Agreement, each Member agrees that, without the consent of the other Members, no Member may withdraw from, terminate or cause a voluntary dissolution of the Company, and, in the event that a Member withdraws from the Company or causes a dissolution of the Company in contravention of this Agreement, such withdrawal or dissolution shall not reduce or otherwise affect such Member’s continuing liability for the obligations and liabilities of the Company.
Section 9.2    Continuation of Interest of Member’s Representative.  Notwithstanding anything contained herein, upon the expulsion, receivership, dissolution or Bankruptcy of a Member, the personal representative, trustee-in-bankruptcy, debtor-in-possession, receiver, other representative, successor, heir or legatee (each a “Representative”) of such Member shall, subject to the provisions of Section 5.1, immediately succeed to the Percentage Interest of such Member in the Company.  Such Representative shall appoint an individual (which may be such Representative) who will represent the Representative’s voting interest, if any. (the “Voting Representative”).
Section 9.3    Dissolution, Winding Up and Liquidation.  
(d)    Upon a dissolution of the Company, the Company shall continue solely for purposes of winding up its affairs in an orderly manner, liquidating its assets, and satisfying claims of its creditors.  The liquidator of the Company shall take full account of the Company’s liabilities and property and shall cause the property or the proceeds from the sale thereof, to the extent sufficient therefor, to be applied and distributed, to the maximum extent permitted by law, in the following order:
(ii)    first, to creditors (including Members who are creditors) in satisfaction of all of the Company’s debts and other liabilities, including the expenses of the winding-up, liquidation and dissolution of the Company (whether by payment or the making of reasonable reserves to provide for payment thereof); and
(iii)    second, to the Members in accordance with Article VII.
(e)    Distributions pursuant to this Section 10.3 shall be made no later than the end of the Fiscal Year during which the Company is liquidated (or, if later, 90 days after the date on which the Company is liquidated).
Section 9.4    Member Bankruptcy.  
(a)    Notwithstanding any other provision of this Agreement, the Bankruptcy of a Member shall not cause the Member to cease to be a member of the Company and upon the occurrence of such an event, the Company shall continue without dissolution.
(b)    Notwithstanding any other provision of this Agreement, each of the Members waives any right it might have to agree in writing to dissolve the Company upon the Bankruptcy of the Members, or the occurrence of an event that causes the Member to cease to be a member of the Company.
ARTICLE X.     
 
INDEMNIFICATION AND CONTRIBUTION
Section 10.1    Indemnity by the Company.  Subject to the provisions of Section 11.4, the Company shall indemnify any Person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative by reason of the fact that such Person is or was a Member, Officer, director, Managing Member, Hotel Manager, controlling person, employee, legal representative or agent of the Company, or is or was serving at the request of the Company as manager, director, Managing Member, Hotel Manager, officer, partner, member, shareholder, controlling person, employee, legal representative or agent of another limited liability company, partnership, corporation, joint venture, trust or other enterprise (an “Indemnified Person”), from and against any and all claims, actions, suits, proceedings, liabilities, obligations, losses, damages, judgments, fines, penalties, amounts paid in settlement, interest, costs and expenses (including reasonable attorney’s and accountant’s fees, court costs and other out-of-pocket expenses actually and reasonably incurred in investigating, preparing or defending the foregoing) (including any such brought by or in the right of the Company) suffered or incurred by such Indemnified Person while serving in such capacity or that otherwise in any way relate to or arise out of any action or inaction by such Indemnified Person or the Company (collectively, “Indemnifiable Losses”), if such Indemnified Person acted in good faith and in a manner that such Indemnified Person reasonably believed to be in or not opposed to the best interests of the Company and not in violation of this Agreement or outside the scope of such Person’s authority, and, with respect to a criminal action or proceeding, had no reasonable cause to believe such Person’s conduct was unlawful; provided, that the Company shall have no obligation to indemnify or defend hereunder to the extent such action, suit or proceeding arises from fraud, bad faith, willful misconduct or gross negligence on the part of such Indemnified Person.
Section 10.2    Exculpation.  No Indemnified Person shall be liable to any Member of the Company for any act or failure to act on behalf of the Company, unless such act or failure to act resulted from fraud, bad faith, willful misconduct or gross negligence of the Indemnified Person.  Each Indemnified Person may consult with legal counsel and accountants in respect of the Company’s affairs and shall be fully protected and justified in any action or inaction which is taken in accordance with the advice or opinion of such counsel or accountants. 
Section 10.3    Expenses.  Any indemnification under Section 11.1, as well as the advance payment of expenses permitted under Section 11.4 shall be made by the Company to the fullest extent permitted under the Act.
Section 10.4    Advance Payment of Expenses.  The expenses of any Member incurred in defending a civil or criminal action, suit or proceeding may be paid by the Company as they are incurred and in advance of the final disposition of the action, suit or proceeding, upon receipt of an undertaking by or on behalf of such Member (in form and substance, from an indemnitor, reasonably satisfactory to all of the Members), to repay the amount if it is ultimately determined by a court of competent jurisdiction that such Member is not entitled to be indemnified by the Company.  The provisions of this Section 11.4 do not affect and shall not be deemed exclusive of any other rights, including, without, limitation, any rights to indemnification or advancement of expenses to which any such Indemnified Person other than the Members may be entitled under any contract, pursuant to approval of the Members, or otherwise by law.
Section 10.5    Beneficiaries.  The indemnification and advancement of expenses authorized in or ordered by a court pursuant to this Article XI continues for a Person who has ceased to be a Member, officer, employee or agent and inures to the benefit of the heirs, executors and administrators of such Person.
Section 10.6    Indemnification Procedure for Third Party and Other Claims.  The Company shall have the right, but not the obligation, exercisable by written notice to the Indemnified Person seeking such indemnification hereunder promptly but in any event no later than 30 days after receipt of  written notice from the Indemnified Person of the commencement of or assertion of any claim, action, suit or proceeding by a third party in respect of which indemnity may be sought hereunder (a “Third Party Claim”), to assume the defense and control the settlement of such Third Party Claim that (a) involves (and continues to involve) solely money damages or (b) involves (and continues to involve) claims for both money damages and equitable relief against the Indemnified Party that cannot be severed, where the claims for money damages are the primary claims asserted by the third party and the claims for equitable relief are incidental to the claims for money damages.  The Indemnified Person shall have the right to assume the defense and control the settlement of any Third Party Claim (i) not described in clauses (a) or (b) of the preceding sentence or (ii) described in clauses (a) or (b) of the preceding sentence whose defense and control of settlement has not been promptly assumed by the Company.  The Company or the Indemnified Person, as the case may be, shall have the right to participate in (but not control), at its own expense, the defense of any Third Party Claim that the other is defending, as provided in this Agreement.  The Company, if it has assumed the defense of any Third Party Claim as provided in this Agreement, shall not consent to a settlement of, or the entry of any judgment arising from, any such Third Party Claim without the Indemnified Person’s prior written consent (which consent shall not be unreasonably withheld).  The Company shall not, without the Indemnified Person’s prior written consent, enter into any compromise or settlement which (A) commits the Indemnified Person to take, or to forbear to take, any action or (B) does not provide for a complete release by such Third Party of the Indemnified Person.  The Indemnified Person shall have the sole and exclusive right to settle any Third Party Claim, on such terms and conditions as it deems reasonably appropriate, to the extent such Third Party Claim involves equitable or other non-monetary relief against the Indemnified Person, and shall have the right to settle any Third Party Claim involving money damages for which the Company has not assumed the defense pursuant to this Section 11.6 with the written consent of the Indemnifying Party, which consent shall not be unreasonably withheld or delayed.   
Section 10.7    Other Claims.  In the event an Indemnified Person shall claim a right to payment pursuant to this Agreement for other than a Third Party Claim, such Indemnified Person shall send written notice of such claim to the Indemnifying Party.  Such notice shall specify the basis for such claim.  As promptly as possible after the Indemnified Person has given such notice, the Indemnified Person and the Company shall attempt to resolve such claim by mutual agreement before resorting to other legal means to resolve such claim.  
Section 10.8    Limitation on Damages.  Notwithstanding anything contained in this Agreement to the contrary, no party shall be liable to the other party for any indirect, special, punitive, exemplary or consequential loss or damage (including any loss of revenue or profit) arising out of this Agreement including, without limitation, in respect of any breach by any Member of this Agreement; provided, that the foregoing shall not be construed to preclude recovery by the Indemnified Person in respect of Indemnifiable Losses directly incurred from Third Party Claims.  Any Indemnified Person shall take commercially reasonable actions to mitigate his, her, its or their damages.  The obligation of the Company to indemnify any Indemnified Person with respect to any Indemnifiable Losses hereunder resulting from any action, suit or proceeding shall not exceed the value of the Business and the Properties.
Section 10.9    Indemnification Under Purchase Agreement.  Chatham Managing Member shall defend, indemnify, and hold harmless the Company, any Property Company, NS Managing Member and the direct and indirect directors, officers, members, managers, principals, investors, partners, agents, successors and permitted assigns of NS Managing Member (each a “NS Indemnified Party”) from and against any and all losses, damages, liabilities, claims, actions, judgments, court costs and legal or other expenses (including, without limitation, reasonable attorneys’ fees and other professional fees and costs) which such NS Indemnified Party incurs as a result of any claims made against a NS Indemnified Party in connection with any obligation or liability under the PSA to the extent relating to the Specified Hotels, the Specified Hotel Interests, or the Specified Hotel Transaction (as such terms are defined in the Purchase and Sale Agreement) and all matters to the extent relating thereto (including, without limitation, post-closing obligations and liabilities and prorations and other adjustments to be made under the Purchase and Sale Agreement to the extent relating thereto).  In the event any amounts are received by Chatham Managing Member, NS Managing Member, or any of their respective Affiliates that relate solely to the Principal Transaction, such Member shall (or shall cause its applicable Affiliate to) promptly remit such amounts to the Company.  The Company shall defend, indemnify, and hold harmless Chatham Managing Member and the direct and indirect directors, officers, members, managers, principals, investors, partners, agents, successors and permitted assigns of Chatham Managing Member (each a “Chatham Indemnified Party”) from and against any and all losses, damages, liabilities, claims, actions, judgments, court costs and legal or other expenses (including, without limitation, reasonable attorneys’ fees and other professional fees and costs) which such Chatham Indemnified Party incurs as a result of any claims made against a Chatham Indemnified Party in connection with any obligation or liability under the PSA to the extent relating to the Principal Transaction (as defined in the Purchase and Sale Agreement) and all matters to the extent relating thereto (including, without limitation, post-closing obligations and liabilities and prorations and other adjustments to be made under the Purchase and Sale Agreement to the extent relating thereto).  In the event any amounts are received by the Company or NS Managing Member or any of their respective Affiliates that relate solely to the Specified Hotels, the Specified Hotel Interests or the Specified Hotel Transaction, the Company or NS Managing Member shall (or shall cause its applicable Affiliate to), as applicable, promptly remit such amounts to Chatham Managing Member.  The amount that may be recovered from the Sellers under the Purchase and Sale Agreement pursuant thereto with respect to the Specified Hotels, the Specified Hotel Interests or the Specified Hotel Transaction shall not exceed $7,770,000.00 without the consent of NS Managing Member.  The amount that may be recovered from the Sellers under the Purchase and Sale Agreement pursuant thereto with respect to the Principal Transaction shall not exceed $22,230,000.00 without the consent of Chatham Managing Member.  The foregoing indemnification and payment obligations shall survive the dissolution of the Company or any Property Company pursuant to this Agreement.
ARTICLE XI.     
 
MISCELLANEOUS PROVISIONS
Section 11.1    Entire Agreement.  This Agreement, the Ink III LLC Agreement and the Certificate of Formation constitute the complete and exclusive statement of the agreement among the Members with respect to the subject matter contained herein and therein.  This Agreement, the Ink III LLC Agreement and the Certificate of Formation replace and supersede all prior agreements by and among the Members with respect to the subject matter contained herein and therein, including, without limitation, that certain Limited Liability Company Agreement of NewINK, LLC, dated as of May 8, 2014.
Section 11.2    Amendments.  This Agreement may be amended only by the unanimous written consent of the Members.
Section 11.3    Applicable Law; Venue.  
(f)    The Certificate of Formation and this Agreement shall be governed exclusively by their respective terms and the laws of the State of Delaware, without regard to the conflicts of laws principles thereof.
(g)    Any legal action or proceeding with respect to this Agreement and any action for enforcement of any judgment in respect thereof may be brought in the courts of the State of New York or of the United States of America for the Southern District of New York, and, by execution and delivery of this Agreement, each Member hereby accepts for itself and in respect of its property, generally and unconditionally, the non-exclusive jurisdiction of the aforesaid courts and the appellate courts thereof.  Each Member irrevocably consents to the service of process out of any of the aforementioned courts in any such action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to such party at the address for notices set forth herein.  Each Member hereby irrevocably waives any objection which it may now or hereafter have to the laying of venue of any of the aforesaid actions or proceedings arising out of or in connection with this Agreement brought in the courts referred to above and hereby further irrevocably waives and agrees not to plead or claim in any such court that any such action or proceeding brought in any such court has been brought in an inconvenient forum.
Section 11.4    Enforcement.  In the event of an action, suit or proceeding initiated by one Member against another Member or the Company involving the enforcement of its rights hereunder, the prevailing party shall be entitled to indemnification from the other party of reasonable attorneys’ fees and expenses incurred in enforcing its rights in such action, suit or proceeding in accordance with this Section.
Section 11.5    Headings.  The headings in this Agreement are inserted for convenience only and are in no way intended to describe, interpret, define, or limit the scope, extent or intent of this Agreement or any provisions contained herein.
Section 11.6    Severability.  If any provision of this Agreement or the application thereof to any Person or circumstance shall be deemed invalid, illegal or unenforceable to any extent, the remainder of this Agreement and the application thereof shall not be affected and shall be enforceable to the fullest extent permitted by law.
Section 11.7    Counterparts.  This Agreement may be executed in several counterparts with the same effect as if the parties executing the several counterparts had all executed one counterpart.
Section 11.8    Filings.  Following the execution and delivery of this Agreement, representatives of the Company, shall promptly prepare any documents required to be filed and recorded under the Act, and such representatives shall promptly cause each such document to be filed and recorded in accordance with the Act and, to the extent required by local law, to be filed and recorded or notice thereof to be published in the appropriate place in each jurisdiction in which the Company may hereafter establish a place of business.  Such representatives, under shall also promptly cause to be filed, recorded and published such statements of fictitious business name and any other notices, certificates, statements or other instruments required by any provision of any applicable law of the United States or any state or other jurisdiction which governs the conduct of its business from time to time.
Section 11.9    Additional Documents.  Each Member agrees to perform all further acts and to execute, acknowledge and deliver any documents that may be reasonably necessary to carry out the provisions of this Agreement.
Section 11.10    Notices.  All notices, requests and other communications to any party hereunder shall be in writing (including facsimile) and shall be effective and deemed delivered or given, as the case may be, (a) if given by facsimile, when transmitted and the appropriate confirmation is received from the machine transmitting such facsimile, and followed by hard copy via overnight mail or reputable overnight courier for receipt the next Business Day, (b) if given by reputable overnight courier, on the next Business Day, (c) by hand delivery, when delivered or (d) if mailed, on the second Business following the day on which sent by first class mail:
To NS Managing Member:

c/o NorthStar Realty Finance Corp.
399 Park Avenue, 18th Floor
New York, New York 10022
Attention:    Dan Gilbert
Facsimile:    (212) 547-2000

And an additional copy at the same time to:

c/o NorthStar Realty Finance Corp.
399 Park Avenue, 18th Floor
New York, New York 10022
Attention:    Ronald J. Lieberman, Esq.
Facsimile:    (212) 547-2700

And an additional copy at the same time to:

c/o NorthStar Realty Finance Corp.
433 East Las Colinas Blvd., Suite 100
Irving, Texas  75039
Attention:     Robert S. Riggs
Facsimile:    (972) 869-6521

With a copy at the same time to:

Duval & Stachenfeld LLP
555 Madison Avenue, 6th Floor
New York, New York 10022
Attention:    Terri L. Adler, Esq. and File Manager
File No.:    3281.0044
Facsimile:    (212) 883-8883

To Chatham Managing Member at:

Chatham Lodging Trust
50 Cocoanut Row, Suite 211
Palm Beach, Florida 33480
Attention:    Jeffrey Fisher
Facsimile:      (561) 835-4125
    
And an additional copy at the same time to:
 
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
Attention:    Robin Panovka, esq.
Victor Goldfeld, esq.
Facsimile:     (212) 403-2000

If to any other Member, at the addresses or facsimile numbers set forth on the signature page to this Agreement or such other addresses or facsimile numbers as such Member may hereafter specify to the Managing Member, who shall so notify the other Members.
Section 11.11    Waiver of Right to Partition and Bill of Accounting.  To the fullest extent permitted by applicable law, each Member covenants that it will not, and hereby waives any right to, file a bill for partnership accounting.  Each Member irrevocably waives any right that it may have to maintain any action for dissolution of the Company (unless the Company is dissolved pursuant to Section 10.1).
Section 11.12    Confidentiality; Press Releases.  Each Member shall keep confidential all information of a confidential nature obtained pursuant to this Agreement, except that a Member shall be entitled to disclose such confidential information to (a) its advisors, agents, employees, trustees, lenders, franchisors, consultants, lawyers, accountants and other service providers as reasonably necessary in the furtherance of such Member’s bona fide interests, as otherwise required by law or judicial process and to comply with reporting requirements, and to potential transferees of its percentage interests provided that such potential transferees enter into customary confidentiality agreements, with the Company expressly stated therein to be a third party beneficiary thereof, (b) its investors (together with the parties listed in clause (a), collectively, the “Member Representatives”), and (c) to the extent required by any party's reporting or other filing requirements under the rules and regulations of the Securities and Exchange Commission or Federal securities law, including, without limitation, to the extent disclosure is required on Form 8(k) with respect to the transaction contemplated hereby or as required by any securities exchange.  Notwithstanding anything in this Agreement to the contrary, to comply with Regulations 1.6011-4(b)(3)(i), each Member (and any employee, representative or other agent of such Member) may disclose to any and all persons, without limitation of any kind, the U.S. federal income tax treatment and tax structure of the Company or any transactions undertaken by the Company, it being understood and agreed, for this purpose, (a) the name of, or any other identifying information regarding (i) the Company or any existing or future Member (or any affiliate thereof) in the Company, or (ii) any investment or transaction entered into by the Company; and (b) any performance information relating to the Company, does not constitute such tax treatment or tax structure information.  Furthermore, the foregoing confidentiality obligations shall not apply to information that (i) is or becomes publicly available other than as a result of acts by the recipient party or its Representatives in breach of this Section, (ii) is in the recipient party’s possession or the possession of its Representatives prior to disclosure by the disclosing party, (iii) is disclosed to the recipient party or its Representatives by a third party, provided that the source of such information is not known by such recipient party or any of its Representatives receiving such information to be prohibited from transmitting such information to such recipient party or its Representatives by a contractual, legal, fiduciary or other obligation, (iv) is independently derived by the recipient party or its Representatives without the aid, application or use of the confidential information, (v) is in the opinion of counsel to the disclosing party, required to be disclosed to comply with any mandatory provision of law, any directive from a government recognized stock exchange on which such party is listed or a binding decision from a court or another government body, (vi) constitutes a generic disclosure about business and pipeline of a party or any affiliate of a party made in the ordinary course of business and would not reasonably be expected to identify the non-disclosing party or the Properties or (vii) in connection with any corporate presentations, earnings calls, earnings releases, press releases (provided that Members shall confer and afford one another a reasonable opportunity to review and provide reasonable comment on any press release to be issued by a Member disclosing the transaction or any of its economic terms and the appropriate time for making such release (but the contents of any such press release will ultimately be determined by the Member issuing or providing same and the foregoing shall not constitute a consent right)), investor reports, investor conference calls or investor meetings which may include, without limitation, disclosure of economic terms and such other matters relating to the transaction which either Member determines is necessary or appropriate.  
Section 11.13    Uniform Commercial Code.  Each limited liability company interest in the Company shall constitute a “security” within the meaning of, and governed by, (i) Article 8 of the Uniform Commercial Code (including Section 8 102(a)(15) thereof) as in effect from time to time in the State of Delaware, and (ii) the Uniform Commercial Code of any other applicable jurisdiction that now or hereafter substantially includes the 1994 revisions to Article 8 thereof as adopted by the American Law Institute and the National Conference of Commissioners on Uniform State Laws and approved by the American Bar Association on February 14, 1995.
Section 11.14    Binding Agreement.  Notwithstanding any other provision of this Agreement, the Members agree that this Agreement constitutes a legal, valid and binding agreement of the Members, and is enforceable against the Members by the Company in accordance with its terms.
Section 11.15    Waiver.  No failure by any party to insist upon the strict performance of any covenant, duty, agreement or condition of this Agreement or to exercise any right or remedy consequent upon a breach thereof shall constitute waiver of any such breach or any other covenant, duty, agreement or condition.
Section 11.16    DISCLOSURES.  THE INTERESTS OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”), OR THE SECURITIES LAWS OF ANY STATE AND ARE BEING OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE 1933 ACT AND SUCH LAWS.  THE INTERESTS ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE 1933 ACT AND SUCH LAWS PURSUANT TO EXEMPTION FROM REGISTRATION THEREUNDER.  THERE WILL NOT BE ANY PUBLIC MARKET FOR THE INTERESTS.  IN ADDITION, THE TERMS OF THIS AGREEMENT RESTRICT THE TRANSFERABILITY OF INTERESTS.
Section 11.17    Limitation on Right to Acquire Loans.  Each Member hereby covenants and agrees that no Member nor an Affiliate of any Member shall enter into any direct or indirect agreement with any Lender with respect to a direct or indirect acquisition of any interest in any Loan or any Asset until the date which is one (1) year after any foreclosure, deed in lieu, conveyance, or other direct or indirect transfer pursuant to which a Lender acquires a direct or indirect ownership interest in an Asset (the foregoing restriction to include any brokerage, commission, fee, participation, management, servicing, or other agreement pursuant to which any Member or an Affiliate of any Member provides services to or receives from or with respect to an Asset).  This Section 12.17 shall survive for one (1) year following the termination of this Agreement.
[Signatures on following page]

W/2274636

IN WITNESS WHEREOF, the parties hereto have executed this Agreement, effective as of the date first above written.
	
		
	MEMBERS:

	 
	 

	 
	 

	 
	 

	PLATFORM MEMBER-T, LLC a

	Delaware limited liability company

	 
	 

	By:
	/s/  Ronald J. Lieberman

	 
	Name:  Ronald J. Lieberman

	 
	Title:  Authorized Signatory

INK I LLC Agreement

	
		
	CHATHAM LODGING, L.P. a

	Delaware limited partnership

	 
	 

	By:
	Chatham Lodging Trust, a Maryland real

	 
	estate investment trust, its general partner

	 
	 

	 
	By:  /s/ Eric Kentoff

	 
	        Name:  Eric Kentoff

	 
	         Title:  Vice President and Secretary

INK I LLC Agreement

SCHEDULE A
PERCENTAGE INTERESTS
	
				
	MEMBER’S NAME
	EFFECTIVE DATE DEEMED CAPITAL CONTRIBUTION AMOUNT
	PERCENTAGE  
INTEREST

	 
	 
	 

	Platform Member-T, LLC
	The Company’s pro rata portion of $192.992,588.40
	89.7222
	%

	Chatham Lodging, L.P.
	The Company’s pro rata portion of $22,107,563.40
	10.2778
	%

	TOTAL
	The Company’s pro rata portion of $215,100,151.80
	100.0
	%

SCHEDULE B
LIST OF PROPERTIES AND PROPERTY COMPANIES
	
				
	 
	Property Company
	Property
	Address

	 
	KPA/GP Louisville (HI) LLC
	Hampton Inn Louisville Downtown
	101 East Jefferson Street 
Louisville, KY 40202

	 
	Grand Prix Addison (RI) LLC
	Residence Inn Addison
	14975 Quorum Dr.
Addison, TX 75240

	 
	Grand Prix Altamonte LLC
	Residence Inn Altamonte Springs
	270 Douglas Ave.  
Altamonte Springs, FL 32714

	 
	Grand Prix Arlington LLC
	Residence Inn Arlington
	1050 Brookhollow Plaza Drive 
Arlington, TX 76006

	 
	Grand Prix Atlanta (Peachtree Corners) LLC
	Residence Inn Atlanta Peachtree
	5500 Triangle Drive  
Norcross, GA 30092

	 
	Grand Prix Atlanta LLC
	Residence Inn Atlanta Downtown
	134 Peachtree Street NW 
Atlanta, GA 30303

	 
	Grand Prix Bellevue LLC
	Residence Inn Bellevue
	14455 NE 29th Place 
Bellevue, WA 098007

	 
	Grand Prix Belmont LLC
	Hyatt House Belmont
	400 Concourse Drive 
Belmont, CA 94002

	 
	Grand Prix Binghamton LLC
	Residence Inn Binghamton
	4610 Vestal Pkwy East
Vestal, NY 13850

	 
	Grand Prix Bothell LLC
	Residence Inn Bothell
	11920 NE 195th Street 
Bothell, WA 98011

	 
	Grand Prix Campbell/San Jose LLC
	Residence Inn San Jose (Campbell)
	2761 South Bascom Ave 
Campbell, CA 95008

	 
	Grand Prix Cherry Hill LLC
	Residence Inn Cherry Hill
	1821 Old Cuthbert Road 
Cherry Hill, NJ 08034

	 
	Grand Prix Chicago LLC
	Residence Inn Rosemont/O'Hare
	7101 Chestnut Street 
Rosemont, IL 60018

	 
	Grand Prix Columbia LLC
	Hampton Inn Columbia
	8880 Columbia 100 Park 
Columbia, MD 21045

	 
	Grand Prix Denver LLC
	Residence Inn Denver Downtown
	2777 Zuni Street  
Denver, CO 80211

	 
	Grand Prix El Segundo LLC
	Hyatt House El Segundo
	810 South Douglas Street 
El Segundo, CA 90245

	 
	Grand Prix Englewood/Denver South LLC
	Residence Inn Denver South (Tech)
	6565 South Yosemite Street 
Greenwood Village, CO 80111

	 
	Grand Prix Fremont LLC
	Residence Inn Fremont
	5400 Farwell Place 
Fremont, CA 94536

	
				
	 
	Property Company
	Property
	Address

	 
	Grand Prix Ft. Lauderdale LLC
	Courtyard Fort Lauderdale
	2440 W Cypress Creek Rd
Fort Lauderdale, FL 33309

	 
	Grand Prix Gaithersburg LLC
	Residence Inn Gaithersburg
	9721 Washingtonian Blvd. 
Gaithersburg, MD 20878

	 
	Grand Prix Horsham LLC
	TownePlace Suites Horsham
	198 Precision Drive 
Horsham, PA 19044

	 
	Grand Prix Islandia LLC
	Hampton Inn Islandia
	1600 Veterans Memorial Highway
Islandia, NY 11749

	 
	Grand Prix Las Colinas LLC
	Hyatt House Las Colinas
	5901 North MacArthur Boulevard 
Las Colinas, TX 75039

	 
	Grand Prix Lexington LLC
	Residence Inn Lexington North
	1080 Newtown Pike 
Lexington, KY 40511

	 
	Grand Prix Livonia LLC
	Residence Inn Livonia
	17250 Fox Drive  
Livonia, MI 48152

	 
	Grand Prix Louisville (RI) LLC
	Residence Inn Louisville North
	120 North Hurstbourne Pkwy 
Louisville, KY 40222

	 
	Grand Prix Lynnwood LLC
	Residence Inn Lynnwood
	18200 Alderwood Mall Parkway
Lynnwood, WA 98037

	 
	Grand Prix Mt. Laurel LLC
	Hyatt House Mt. Laurel
	3000 Crawford Place
Mount Laurel, NJ 08054

	 
	Grand Prix Naples LLC
	Hampton Inn Naples, FL
	3210 Tamiami Trail North 
Naples, FL 34102

	 
	Grand Prix Portland LLC
	Residence Inn Portland
	800 Roundwood Drive 
Portland, ME 04074

	 
	Grand Prix Richmond LLC
	Residence Inn Richmond West
	2121 Dickens Road
Richmond, VA 23230

	 
	Grand Prix Richmond (Northwest) LLC
	Residence Inn Richmond NW
	3940 Westerre Parkway 
Richmond, VA 23233

	 
	Grand Prix Saddle River LLC
	Residence Inn Saddle River
	7 Boroline Road 
Saddle River, NJ 07458

	 
	Grand Prix San Jose LLC
	Residence Inn San Jose South
	6111 San Ignacio Ave  
San Jose, CA 95119

	 
	Grand Prix Shelton LLC
	Residence Inn Shelton
	1001 Bridgeport Ave.  
Shelton, CT 06484

	 
	Grand Prix Tukwila LLC
	Residence Inn Tukwila
	16201 West Valley Highway 
Tukwila, WA 98188

	 
	Grand Prix Willow Grove LLC
	Hampton Inn Willow Grove
	1500 Easton Road
Willow Grove, PA 19090

	
				
	 
	Property Company
	Property
	Address

	 
	Grand Prix Windsor LLC
	Residence Inn Windsor
	I-91 at Bloomfield Ave., 100 Dufney Lane  
Windsor, CT 06095

	 
	Grand Prix Addison (SS) LLC
	Hyatt House Addison
	4900 Edwin Lewis Drive 
Addison, TX 75001

	 
	Grand Prix Atlantic City LLC
	Courtyard Atlantic City
	1212 Pacific Avenue  
Atlantic City, NJ 08401

	 
	Grand Prix Harrisburg LLC
	Residence Inn Harrisburg
	4480 Lewis Road
Harrisburg, PA 17111

	 
	Grand Prix Montvale LLC
	Courtyard Montvale
	Southwest Quadrant of Garden State Parkway and Grand Street
Montvale, NJ 07645

	 
	Grand Prix Morristown LLC
	Westin Governor Morris
	2 Whippany Road 
Morristown, NJ 07960

	 
	Grand Prix Ontario LLC
	Residence Inn Ontario
	2025 Convention Center Way 
Ontario, CA 91764

	 
	Grand Prix Rockville LLC
	Sheraton Rockville
	920 Redland Boulevard 
Rockville, MD 20850

	 
	Grand Prix Troy (SE) LLC
	Residence Inn Troy - SE
	32650 Stephenson Highway 
Madison Heights, MI 48071

	47.
	KPA/GP Ft. Walton Beach LLC
	Four Points Ft. Walton Beach
	1325 Miracle Strip  
Ft. Walton Beach, FL 32548

SCHEDULE C

Reserved  

SCHEDULE D
CONTRIBUTION AGREEMENT
(Attached hereto)

 

SCHEDULE E
Reserved

SCHEDULE  F
OPTION CLOSING TERMS

The closing with respect to the purchase by NS Managing Member of Chatham Managing Member’s interests in the Company shall take place on the following terms:

F.1.        The Option Closing shall take place on the Option Closing Date and shall be held at the principal offices of the Company (or another location mutually agreed upon by the parties).

F.2.         At the Option Closing, Chatham Managing Member shall convey to NS Managing Member (or their designees, subject to Section 10 below) Chatham Managing Member’s membership interest in the Company.

F.3.        NS Managing Member shall pay to Chatham Managing Member an amount equal to the Option Price which shall be paid by certified or cashier’s check, or wire transfer of immediately available funds in the currency of the United States of America. 

F.4.        At the Option Closing, Chatham Managing Member shall deliver to NS Managing Member: (i) evidence reasonably satisfactory to NS Managing Member of the due corporate, partnership, limited liability company or other authority of Chatham Managing Member to convey its interest to NS Managing Member and (ii) a certificate containing representations and warranties of Chatham Managing Member regarding (1) the due authorization, execution and delivery of the closing documents, (2) due formation, valid existence and good standing in all applicable jurisdictions, (3) the enforceability of the closing documents being signed by Chatham Managing Member (except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws relating to or affecting creditor’s rights generally or by general equitable principles), (4) that all material consents and approvals necessary to be obtained with respect to the transaction in respect only of Chatham Managing Member have been obtained, (5) that Chatham Managing Member has not dealt with any brokers, finders or similar parties in connection with the sale that could entitle any such party to claim a commission, fee or other compensation in connection therewith (or, if there are any such brokers, finders or similar parties, that same have been paid in full concurrently with the Option Closing) and (6) that there are no liens or encumbrances affecting the membership interests of Chatham Managing Member (other than liens being discharged concurrently with the Option Closing).  The representations and warranties contained in such certificate shall survive the Option Closing for a period of twelve (12) months.

F.5.        At the Option Closing, NS Managing Member shall deliver to Chatham Managing Member: (i) evidence reasonably satisfactory to Chatham Managing Member of the due corporate, partnership, limited liability company or other authority of NS Managing Member to acquire the interests of Chatham Managing Member and (ii) a certificate containing representations and warranties of NS Managing Member regarding (1) the due authorization, execution and delivery of the closing documents, (2) due formation, valid existence and good standing in all applicable jurisdictions, (3) the enforceability of the closing documents being signed by NS Managing Member (except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws relating to or affecting creditor’s rights generally or by general equitable principles), (4) that all material consents and approvals necessary to be obtained with respect to the transaction in respect only of NS Managing Member have been obtained and (5) that NS Managing Member has not dealt with any brokers, finders or similar parties in connection with the sale that could entitle any such party to claim a commission, fee or other compensation in connection therewith (or, if there are any such brokers, finders or 

    

similar parties, that same have been paid in full concurrently with the Option Closing).  The representations and warranties contained in such certificate shall survive the Option Closing for a period of twelve (12) months.

F.6.        Any transfer tax, recording tax or similar taxes arising out of or in connection with the sale and transfer of the membership interest of Chatham Managing Member in the Company shall be paid pursuant to the custom of the jurisdiction in which the Assets are located (e.g., if the Assets are located in a state which assesses a transfer tax in connection with the Option Closing and such tax would be paid by the seller if the Assets had been sold, then Chatham Managing Member shall pay such transfer tax).

F.7.        Subject to Section 11 below, such sale shall be subject to all liabilities and obligations of the Company, matured or unmatured, absolute or contingent.

F.8.        At the Option Closing, the Members shall execute or cause to be executed any and all documents (in form and substance reasonably acceptable to each of the Members) reasonably required to fully transfer good and valid title to the membership interest of Chatham Managing Member in the Company to NS Managing Member.

F.9.    If the Notice Recipient shall fail to consummate the Option Closing on the Option Closing Date for any reason other than the default of the Initiating Party, then the Initiating Party shall be entitled to all of its remedies at law or in equity, including, without limitation the right of specific performance, in which event the Initiating Party shall be entitled to receive all costs, expenses and damages (including, without limitation, reasonable attorneys’ fees) incurred by the Initiating Party in obtaining such specific performance.  If either party shall fail to consummate the Option Closing on the Option Closing Date for any reason other than the default of the other party, then (i) the non-defaulting party shall be entitled to all of its remedies at law or in equity (other than the right of compel the Option Closing to occur, except as provided in the preceding sentence), including without limitation the right to terminate the Option Closing, in which event the defaulting party shall reimburse the non-defaulting party for all of its costs, expenses and damages (including, without limitation, reasonable attorneys’ fees) incurred in connection with the put/call transaction and (ii) if Chatham Managing Member is the defaulting party with respect to a put transaction, then  Chatham Managing Member shall forfeit its right to deliver another Put Notice pursuant to Section 3.8 with respect to the specific event that triggered Chatham Managing Member’s right to deliver such Put Notice (it being understood that Chatham Managing Member shall retain the right to deliver a Put Notice with respect to any other event, including a subsequent occurrence of the same type of event). 

F.10.     Upon request made by NS Managing Member, Chatham Managing Member will, at no cost or expense to Chatham Managing Member, cooperate with NS Managing Member so that the option transaction is structured as a sale of all of the Option Interests to a third party purchaser that is designated by NS Managing Member, provided that such cooperation shall not release NS Managing Member from its obligation to consummate the Option Closing, shall not delay the Option Closing Date, shall not decrease the amounts ultimately payable to Chatham Managing Member and shall not in Chatham Managing Member’s reasonable judgment expose Chatham Managing Member to any increased risk or liability (including, without limitation, income tax liability) in excess of that which it would have had in the event the transaction were structured as a purchase by the NS Managing Member of the Option Interests.

F.11.    In connection with the Option Closing, if (i) the consent of any Lender shall be required to the consummation of the transactions contemplated by such Option Closing (to the extent such consent is required by the terms of the Loan Documents), or (ii) Chatham Managing Member (or any Affiliate or principal of Chatham Managing Member) is a party to a Carveout Guaranty, then NS Managing Member shall be required to deliver to Chatham Managing Member as a condition to Chatham Managing Member’s obligation to effect 

    

the Option Closing evidence of such consent (if clause (i) applies) and shall use good faith efforts to deliver to Chatham Managing Member a full and unconditional release from such Lender of all such liability other than any liability resulting directly from acts of Chatham Managing Member prior to the Option Closing Date (if clause (ii) applies), provided that in connection with clause (ii), if Lender refuses to grant such release to Chatham Managing Member then NS Managing Member shall be required as a condition to Chatham Managing Member’s obligation to effect the Option Closing to deliver to Chatham Managing Member a full and unconditional release from such Lender of all liability under a Carveout Guaranty arising for events first occurring after the Option Closing Date. In connection with the JPM Loan, the parties acknowledge and agree that NS Managing Member shall only be required to deliver to Chatham Managing Member a full and unconditional release of all liability under the Carveout Guaranty arising for events first occurring after the Option Closing Date (and not a release for all acts other than those arising from acts of Chatham Managing Member). If the Lender refuses to grant its consent at or before the Option Closing Date (if clause (i) applies) and the aforementioned release (if clause (ii) applies), then as a condition to the obligation of Chatham Managing Member to consummate the sale of its membership interests at the Option Closing (A) NS Managing Member shall be required to cause the Company (or Property Company) to prepay such indebtedness in full or defease the Loan at the Option Closing in accordance with the provisions of the Loan Documents (including the payment of any prepayment penalty, prepayment premium, costs of defeasance and/or breakage costs) and (B) if NS Managing Member does not take the actions required in subclause (A), then such failure shall be deemed a default by NS Managing Member. 

F.12.     NS Managing Member hereby indemnifies and holds harmless Chatham Managing Member from any liability, damage, cost or expense (including, without limitation, reasonable attorneys’ fees and costs incurred in the enforcement of the foregoing indemnity) arising out of the Company, the Assets, this Agreement, and any guaranty or indemnity made by Chatham Managing Member (including, without limitation, an indemnity made to a title insurance company), to the extent that any such liability, damage, cost or expense is based on actions or events occurring on or after the Option Closing Date.  The foregoing indemnity will survive the Option Closing.

F.13.    If at the time of the Option Closing, there is a dispute between the parties in connection with the transaction, including, without limitation, a litigation, action or proceeding or an arbitration proceeding or a disagreement in the calculation of the Option Price or any related prorations or adjustments or any other calculation or computation arising out of the Option Closing (any such being referred to as an “Existing Option Dispute”), then the existence of such Existing Option Dispute shall not affect the consummation of the Option Closing, and the parties shall consummate the Option Closing as if the Existing Option Dispute did not exist, however, such Existing Option Dispute shall continue in effect on and after such Option Closing with the intent and purpose that the parties shall not prejudice their respective rights in respect of any such Existing Option Dispute.  In furtherance of the foregoing (x) if such Existing Option Dispute pertains to a dispute over money, then an amount equal to the sum of money in question shall be withheld from the proceeds to be distributed to Chatham Managing Member at the Option Closing and shall be maintained in escrow by a national escrow agent selected by NS Managing Member and reasonably acceptable to Chatham Managing Member after the Option Closing to permit the parties to continue the Existing Option Dispute and have such escrowed funds available to pay for any resolution thereof that requires Chatham Managing Member to pay over such funds to NS Managing Member or vice versa and (y) if such Existing Option Dispute pertains to a matter other than a specified sum of money, then if the Existing Option Dispute is not resolved by the Option Closing itself (i.e., the conveyance of Chatham Managing Member’s membership interest to NS Managing Member may cause the Existing Option Dispute to be rendered moot) the parties shall continue such dispute subsequent to the Option Closing Date.

    

SCHEDULE G

BUY/SELL CLOSING TERMS

The closing with respect to the purchase by the Purchasing Member of the Selling Member’s(s’) interest in the Company shall take place on the following terms:

G.1.    The closing pursuant to the Buy/Sell Notice or Buy/Sell Response (the “Buy/Sell Closing”) shall take place on the Buy/Sell Closing Date and shall be held at the principal offices of the Company.

G.2.    At the Buy Sell Closing, the Selling Member shall convey to the Purchasing Member (or its designee, subject to Section 11 below) the Selling Member’s membership interest in the Company, free and clear of liens and encumbrances.

G.3.    The Purchasing Member shall pay to the Selling Member an amount equal to the Buy/Sell Membership Interest Purchase Price which shall be paid by certified or cashier’s check, or wire transfer of immediately available funds in the currency of the United States of America.  An amount equal to the Buy/Sell Deposit Funds shall be applied against the Buy/Sell Membership Interest Purchase Price.  If there is more than one Purchasing Member, then each such Purchasing Member shall pay its respective pro rata share (based on the ratio of such Purchasing Member’s Percentage Interest to the sum of the Percentage Interests of all Purchasing Members) of the Buy/Sell Membership Interest Purchase Price.

G.4.    At the Buy/Sell Closing, the Selling Member shall deliver to the Purchasing Member (i) evidence reasonably satisfactory to the Purchasing Member of the due corporate, partnership, limited liability company or other authority of such Member to convey its interest to the Purchasing Member and (ii) a certificate containing representations and warranties of such Member regarding (1) the due authorization, execution and delivery of the closing documents, (2) due formation, valid existence and good standing in all applicable jurisdictions, (3) the enforceability of the closing documents being signed by such Member (except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws relating to or affecting creditor’s rights generally or by general equitable principles), (4) that all material consents and approvals necessary to be obtained with respect to the transaction in respect only of such Member have been obtained, (5) that such Member has not dealt with any brokers, finders or similar parties in connection with the sale that could entitled any such party to claim a commission, fee or other compensation in connection therewith (or, if there are any such brokers, finders or similar parties, that same have been paid in full concurrently with the Buy/Sell Closing) and (6) that there are no liens or encumbrances affecting the membership interests of the Selling Member (other than liens being discharged concurrently with the Buy/Sell Closing).  The representations and warranties contained in such certificate shall survive the Buy/Sell Closing for a period of twelve (12) months.

G.5.    At the Buy/Sell Closing, the Purchasing Member shall deliver to the Selling Member (i) evidence reasonably satisfactory to the Selling Member of the due corporate, partnership, limited liability company or other authority of such Member to acquire the interests of the Selling Member and (ii) a certificate containing representations and warranties of such Member regarding (1) the due authorization, execution and delivery of the closing documents, (2) due formation, valid existence and good standing in all applicable jurisdictions, (3) the enforceability of the closing documents being signed by such Member (except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium and other similar laws relating to or affecting creditor’s rights generally or by general equitable principles), (4) that all material consents and approvals necessary to be obtained with respect to the transaction in respect only of such Member have been obtained, and (5) that such Member has not dealt with any brokers, finders or similar parties in connection with the sale that could entitle any such party to claim a commission, fee or other compensation in connection therewith (or, if there are any such brokers, finders or similar parties, that same have been paid in full concurrently with the 

    

Buy/Sell Closing).  The representations and warranties contained in such certificate shall survive the Buy/Sell Closing for a period of twelve (12) months.

G.6.    Any transfer tax, recording tax or similar taxes arising out of or in connection with the sale and transfer of the membership interest of the Selling Member in the Company shall be paid pursuant to the custom of the jurisdiction in which the Assets are located (e.g., if the Assets are located in a state which assesses a transfer tax in connection with the Buy/Sell Closing and such tax would be paid by the seller if the Assets had been sold, then the Selling Member shall pay such transfer tax). 

G.7.    Subject to Section 12 below, such sale shall be subject to all liabilities and obligations of the Company, matured or unmatured, absolute or contingent.

G.8.    At the Buy/Sell Closing, the Members shall execute or cause to be executed any and all documents (in form and substance reasonably acceptable to each of the Members) reasonably required to fully transfer good and valid title to the membership interest of the Selling Member in the Company to the Purchasing Member. 

G.9.    If the Purchasing Member shall fail to consummate the Buy/Sell Closing on the Buy/Sell Closing Date for any reason other than the default of the Selling Member, then the Selling Member shall be entitled as its sole remedy as liquidated damages to (a) cause the Buy/Sell Deposit Funds to be delivered to the Selling Member and terminate the buy/sell transaction and/or (b) purchase the Purchasing Member’s membership interest in the Company at a price equal to the Buy/Sell Membership Interest Purchase Price that would be obtained if the Purchasing Member were treated as the Selling Member in the definition thereof.

G.10.    If the Selling Member shall fail to consummate the Buy/Sell Closing on the Buy/Sell Closing Date for any reason other than the default of the Purchasing Member, then the Purchasing Member shall be entitled to all of its remedies at law or in equity, including, without limitation (i) the right of specific performance, in which event the Purchasing Member shall be entitled to receive all costs, expenses and damages (including, without limitation, reasonable attorneys’ fees) incurred by the Purchasing Member in obtaining such specific performance and (ii) the right to terminate the buy/sell transaction, in which event the Selling Member shall cause the Buy/Sell Escrow Agent to return the Buy/Sell Deposit Funds to the Purchasing Member, and the Selling Member shall reimburse the Purchasing Member for all of its costs, expenses and damages (including, without limitation, reasonable attorneys’ fees) incurred in connection with the buy/sell transaction. 

G.11.    Upon request made by the Purchasing Member, the Selling Member will, at no cost or expense to the Selling Member, cooperate with the Purchasing Member so that the buy/sell transaction is structured as a sale of all of the Assets to a third party purchaser that is designated by the Purchasing Member, provided that such cooperation shall not release the Purchasing Member from its obligation to consummate the Buy/Sell Closing, shall not delay the Buy/Sell Closing Date, shall not decrease the amounts ultimately payable to the Selling Member and shall not in the Selling Member’s reasonable judgment expose the Selling Member to any increased risk or liability (including, without limitation, income tax liability) in excess of that which it would have had in the event the transaction were structured as a purchase by the Purchasing Member of the Selling Member’s membership interest.

G.12.    In connection with the Buy/Sell Closing, if (i) the consent of any Lender shall be required to the consummation of the transactions contemplated by such Buy/Sell Closing (to the extent such consent is required by the terms of the Loan Documents) or (ii) the Selling Member (or any Affiliate or principal of the Selling Member) is a party to a Carveout Guaranty, then the Purchasing Member shall be required to deliver to the Selling Member as a condition to the Selling Member’s obligation to effect the Buy/Sell Closing evidence of such consent (if clause (i) applies) and shall use good faith efforts to deliver to the Selling Member a full and 

    

unconditional release from such Lender of all such liability other than any liability resulting directly from acts of the Selling Member prior to the Buy/Sell Closing Date (if clause (ii) applies), provided that in connection with clause (ii), if Lender refuses to grant such release to the Selling Member then the Purchasing Member shall be required as a condition to the Selling Member’s obligation to effect the Buy/Sell Closing to deliver to the Selling Member a full and unconditional release from such Lender of all liability under a Carveout Guaranty arising for events first occurring after the Buy/Sell Closing Date. In connection with the JPM Loan, the parties acknowledge and agree that if NS Managing Member is the Purchasing Member the NS Managing Member shall only be required to deliver to Chatham Managing Member, as Selling Member a full and unconditional release of all liability under the Carveout Guaranty arising for events first occurring after the Buy/Sell Closing Date (and not a release for all acts other than those arising from acts of Chatham Managing Member). If the Lender refuses to grant its consent at or before the Buy/Sell Closing Date (if clause (i) applies) and the aforementioned release (if clause (ii) applies), then as a condition to the obligation of the Selling Member to consummate the sale of its membership interests at the Buy/Sell Closing (A) the Purchasing Member shall be required to cause the Company (or Property Company) to prepay such indebtedness in full or defease the Loan at the Buy/Sell Closing in accordance with the provisions of the Loan Documents (including the payment of any prepayment penalty, prepayment premium, costs of defeasance and/or breakage costs) and (B) if the Purchasing Member does not take the actions required in subclause (A), then such failure shall be deemed a default by the Purchasing Member. 

G.13.    If the Buy/Sell Notice is delivered then the Purchasing Member hereby indemnifies and holds harmless the Selling Member from any liability, damage, cost or expense (including, without limitation, reasonable attorneys’ fees and costs incurred in the enforcement of the foregoing indemnity) arising out of the Company, the Assets, this Agreement, and (if Chatham Managing Member is the Selling Member) any guaranty or indemnity made by Chatham Managing Member (including, without limitation, an indemnity made to a title insurance company), to the extent that any such liability, damage, cost or expense is based on actions or events occurring on or after the Buy/Sell Closing Date. The foregoing indemnity will survive the Buy/Sell Closing.

G.14.    The parties acknowledge that the Buy/Sell Notice shall not be required to set forth the calculation, or the determination of, the Buy/Sell Membership Interest Purchase Price (which amount shall be determined in connection with the consummation of the Buy/Sell Closing).

G.15.    The escrow provisions contained in Schedule H are incorporated herein for the benefit of the Buy/Sell Escrow Agent.  In addition, both parties agree, upon request made by any Buy/Sell Escrow Agent, to deliver any supplemental indemnification or other provisions for the benefit of such Buy/Sell Escrow Agent.

G.16.    If at the time of the Buy/Sell Closing, there is a dispute between the parties in connection with the transaction, including, without limitation, a litigation, action or proceeding or an arbitration proceeding or a disagreement in the calculation of the Buy/Sell Membership Interest Purchase Price or any related prorations or adjustments or any other calculation or computation arising out of the Buy/Sell Closing (any such being referred to as an “Existing Dispute”), then the existence of such Existing Dispute shall not affect the consummation of the Buy/Sell Closing, and the parties shall consummate the Buy/Sell Closing as if Existing Dispute did not exist, however, such Existing Dispute shall continue in effect on and after such Buy/Sell Closing with the intent and purpose that the parties shall not prejudice their respective rights in respect of any such Existing Dispute.  In furtherance of the foregoing (x) if such Existing Dispute pertains to a dispute over money, then an amount equal to the sum of money in question shall be withheld from the proceeds to be distributed to the Selling Member at the Buy/Sell Closing and shall be maintained in escrow by the Buy/Sell Escrow Agent after the Buy/Sell Closing to permit the parties to continue the Existing Dispute and have such escrowed funds available to pay for any resolution thereof that requires the Selling Member to pay over such funds to the Purchasing Member or vice versa and (y) if such Existing Dispute pertains to a matter other than a specified sum of money, then if the Existing Dispute is not resolved by the Buy/Sell Closing itself (i.e., the conveyance 

    

of the Selling Member’s membership interest in the Company to the Purchasing Member may cause the Existing Dispute to be rendered moot) the parties shall continue such dispute subsequent to the Buy/Sell Closing Date.
    

    

SCHEDULE H

BUY/SELL ESCROW PROVISIONS

1.    The Buy/Sell Escrow Agent shall deposit the Buy/Sell Deposit Funds in an interest bearing escrow account.

2.    If the Buy/Sell Closing takes place, the Buy/Sell Escrow Agent shall deliver the Buy/Sell Deposit Funds to, or upon the instructions of, the Selling Member(s) at the Buy/Sell Closing.

3.    If the Buy/Sell Closing does not take place pursuant to the provisions of this Agreement, by reason of the failure of any party to comply with its obligations hereunder, the Buy/Sell Escrow Agent shall pay the Buy/Sell Deposit Funds to the party entitled thereto in accordance with the provisions of this Agreement, provided, however, prior to paying the Buy/Sell Deposit Funds to any party (the “Claiming Party”) pursuant to the provisions of this Section 3, the Buy/Sell Escrow Agent shall deliver written notice to the other party (the “Non-Claiming Party”) stating its intention to pay the Buy/Sell Deposit Funds to the Claiming Party.  The Non-Claiming Party shall have a period of ten (10) days in which to deliver notice to the Buy/Sell Escrow Agent agreeing to payment of the Buy/Sell Deposit Funds to the Claiming Party or disagreeing with such payment.  If the Non-Claiming Party agrees that the Buy/Sell Deposit Funds shall be paid to the Claiming Party, then the Buy/Sell Escrow Agent shall so pay the Buy/Sell Deposit Funds to the Claiming Party.  If the Non-Claiming Party disagrees with such payment, then the Buy/Sell Escrow Agent shall not make such payment and shall continue to hold the Buy/Sell Deposit Funds and shall not make any disposition of the Buy/Sell Deposit Funds except as provided in Section 5 below.  The failure of the Non-Claiming Party to deliver such notice within the ten (10) day period shall be deemed delivery of a notice on the last day of such ten (10) day period agreeing to payment of the Buy/Sell Deposit Funds to the Claiming Party.

4.     It is agreed that:

(a)    The duties of the Buy/Sell Escrow Agent are only as herein specifically provided and are purely ministerial in nature, and the Buy/Sell Escrow Agent shall incur no liability whatever except for willful misconduct or gross negligence, as long as the Buy/Sell Escrow Agent has acted in good faith;

(b)    The Buy/Sell Escrow Agent shall not be liable or responsible for the collection of the proceeds of any check or wire transfer constituting all or a portion of the Buy/Sell Deposit Funds;

(c)    In the performance of its duties hereunder, the Buy/Sell Escrow Agent shall be entitled to rely upon any document, instrument or signature believed by it to be genuine and signed by either of the other parties or their successors;

(d)    The Buy/Sell Escrow Agent may assume that any person purporting to give any notice of instructions in accordance with the provisions hereof has been duly authorized to do so;

(e)    The Buy/Sell Escrow Agent shall not be bound by any modification, cancellation or rescission of these escrow provisions unless in writing and signed by it, the selling parties and the purchasing parties;

(f)    The selling parties and the purchasing parties shall jointly and severally reimburse and indemnify the Buy/Sell Escrow Agent for, and hold it harmless against, any and all loss, liability, cost or expense in connection herewith, including reasonable legal fees and disbursements, incurred without willful misconduct or gross negligence on the part of the Buy/Sell Escrow Agent arising out of or in connection with its acceptance 

    

of, or the performance of its duties and obligations under these escrow provisions, as well as the reasonable costs and expenses of defending against any claim or liability arising out of or relating to these Escrow Provisions; and

(g)    The Manager and the Members each hereby release the Buy/Sell Escrow Agent from any act done or omitted to be done by the Buy/Sell Escrow Agent in good faith in the performance of its duties hereunder.

5.    The Buy/Sell Escrow Agent is acting as a stake-holder only with respect to the Buy/Sell Deposit Funds.  If there is any dispute as to whether the Buy/Sell Escrow Agent is obligated to deliver all or any portion of the Buy/Sell Deposit Funds or as to whom the proceeds of the Buy/Sell Deposit Funds are to be delivered, the Buy/Sell Escrow Agent shall not be required to make any delivery, but in such event the Buy/Sell Escrow Agent shall hold the Buy/Sell Deposit Funds (together with all interest thereon, if any) until receipt by the Buy/Sell Escrow Agent of an authorization in writing, signed by all of the parties having any interest in such dispute, directing the disposition of the Buy/Sell Deposit Funds (together with all interest thereon, if any), or, in the absence of such authorization, the Buy/Sell Escrow Agent shall hold the Buy/Sell Deposit Funds (together with all interest thereon, if any), until the final determination of the rights of the parties in an appropriate proceeding.  If such written authorization is not given, or proceedings for such determination are not begun within ninety (90) days after the date the Buy/Sell Escrow Agent shall have received written notice of such dispute, and thereafter diligently continued, the Buy/Sell Escrow Agent shall have the right, but not the obligation, to bring an appropriate action or proceeding for leave to deposit the Buy/Sell Deposit Funds (together with all interest thereon, if any), in court pending such determination.  The Buy/Sell Escrow Agent shall be reimbursed for all costs and expenses of such action or proceeding including, without limitation, reasonable attorneys’ fees and disbursements, by the party determined not to be entitled to the Buy/Sell Deposit Funds or if the Buy/Sell Deposit Funds is split between the parties hereto, such costs of the Buy/Sell Escrow Agent shall be split, pro rata, between the selling parties and the purchasing parties, upon the amount of Buy/Sell Deposit Funds received by each.  Upon making delivery of the Buy/Sell Deposit Funds (together with interest thereon, if any), in the manner provided in this Agreement, the Buy/Sell Escrow Agent shall have no further liability hereunder.

6.    The Buy/Sell escrow agent will be required to execute a counterpart of these escrow provisions solely to confirm that the buy/sell escrow agent upon receipt thereof, will hold the Buy/Sell deposit funds in escrow, pursuant to the provisions of this Agreement.

    

SCHEDULE I

Reserved

SCHEDULE J

Reserved

    

SCHEDULE K
EXPEDITED ARBITRATION PROCEDURES
(a)    Venue:  The arbitration proceeding shall be conducted in New York, New York before a single arbitrator.
(b)    Procedure:  Except as provided herein, the arbitration proceeding shall be conducted in accordance with the Agreement (including this Schedule K), and otherwise in accordance with the Commercial Arbitration Rules of the AAA, or its successor, and the Expedited Procedures provisions thereof, to the extent not inconsistent with the Agreement and this Schedule K.
(c)    Selection of Arbitrator:  Chatham Managing Member shall provide written notice to NS Managing Member of submission of the disputed matter to arbitration in accordance with Section 3.2(i), and in such notice propose at least three (3) persons to serve as the arbitrator. Each of the proposed arbitrators shall be either (i) a retired judge or justice, or (ii) an experienced attorney licensed to practice and practicing in the State of Delaware or the State of New York. Each of the proposed arbitrators shall have had no business relationship (other than acting as arbitrator or mediator) or familial relationship with either party, or any Affiliate of either party, or primary counsel to either party in a significant matter during the past ten (10) years.  NS Managing Member shall give written notice within three (3) days stating either (i) NS Managing Member is willing to accept one of the proposed arbitrators as the arbitrator or (ii) NS Managing Member is not willing to accept one of the arbitrators proposed by Chatham Managing Member, and proposing at least three (3) other persons to serve as the arbitrator, in which case Chatham Managing Member shall have three (3) days from the date of such notice to notify NS Managing Member if one of the arbitrators proposed by NS Managing Member is acceptable.  If this procedure does not result in the selection of the arbitrator, then the parties shall request the American Arbitration Association, or its successor, to appoint an arbitrator who shall have the qualifications identified above (and, in connection therewith, either party may propose not more than three (3) persons having such qualifications to the American Arbitration Association to serve as arbitrator) pursuant to the Expedited Procedures of the Commercial Arbitration Rules of the AAA.
(d)    Conferences, Discovery and Pre-Hearing Matters:  Once the arbitrator is appointed, he or she shall set the matter for a conference, which may be conducted telephonically, to take place within five (5) days of the arbitrator’s appointment, and which shall address, among other things, the following issues:  (1) the scheduling of, and resolution of any issues concerning the nature, extent and timing of any discovery, including the production of documents, depositions and the exchange of expert witness information and reports (if any); (2) the identification and resolution of any other procedural issues; (3) the scheduling of written submissions to the arbitrator; and (4) setting the matter for a hearing, to take place within fifteen (15) days of the date of the conference unless the arbitrator finds, for good cause, that the hearing should not take place within that time period.  Notwithstanding the foregoing, the parties may by written agreement modify the time for the conference or hearing described in this paragraph (d), or any other deadline, subject to the approval of the arbitrator.  
(e)    Applicable Law:  The arbitrator shall be required to determine all issues in accordance with existing substantive law of the state of Delaware; provided, however, that statutes and case law relating to the order of proof, the conduct of the hearing and the presentation and admissibility of evidence will not be applicable, and the arbitrator shall determine the admissibility, relevance and materiality of 

any evidence proffered, including hearsay, and may exclude evidence deemed by the arbitrator to be cumulative or irrelevant.
(f)    Arbitrator’s Powers and Duties:  The arbitrator shall have the power to grant any and all forms of relief, including, but not limited to, equitable relief, to prevent any arbitration award from becoming ineffectual; provided, however, the arbitrator may not alter or amend the provisions of this Agreement (including this Schedule K) in granting such relief.  Pending appointment of the arbitrator, nothing provided herein shall preclude either of the parties from seeking the issuance of a temporary restraining order, preliminary injunction or other provisional remedy in order to avoid any irreparable injury that it might suffer pending such appointment.
(g)    Arbitrator’s Award:  The arbitrator shall render his or her award within ten (10) days of the close of the final submission of the matter, or at such later time as agreed upon by the parties. The arbitrator’s award shall be in writing, and the arbitrator shall make findings of fact and conclusions of law that set forth the reasons for the award.  The award may be confirmed by any court having jurisdiction over the parties. 
(h)    Arbitrator’s Fees and Costs:  Each party shall provide, within three (3) days of a request from the arbitrator or any person or service that may be acting as the administrator of the arbitration, one-half of the estimated fees and costs relating to the arbitration, although the arbitrator shall, in his or her award,  assess such fees and costs against the party determined not to be the prevailing party in the Expedited Arbitration.  Notwithstanding the foregoing, the party not prevailing in the Expedited Arbitration shall pay all of the reasonable fees and costs relating to the arbitration, including the prevailing party’s reasonable, actual, out-of-pocket attorneys’ fees and expenses.
(i)    No Other Claims.  For the avoidance of doubt, this Schedule K shall apply only in connection with an Expedited Arbitration pursuant to Section 2.2(c)(iii) and Section 3.2(i) of the Agreement, and not any other dispute, and no other claims or counterclaims may be brought in such Expedited Arbitration.

    

SCHEDULE L
P&L STATEMENT

SCHEDULE M
BALANCE SHEET

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