Document:

Exhibit 10.80 

West Monroe, LA (HGI) 

PURCHASE CONTRACT

between

LODGING AMERICA OF WEST MONROE, LLC
(“SELLER”)

 (“SELLER”)

AND

APPLE NINE HOSPITALITY OWNERSHIP, INC.
(“BUYER”)

AND

Dated:
May 28, 2010

TABLE OF CONTENTS

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
 Page No.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	

 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE I

 	
  

 	
 DEFINED TERMS

 	
  

 	
 1

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 1.1

 	
  

 	
 Definitions

 	
  

 	
 1

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE II

 	
  

 	
 PURCHASE AND SALE; PURCHASE PRICE; PAYMENT;
 EARNEST MONEY DEPOSIT

 	
  

 	
 6

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 2.1

 	
  

 	
 Purchase and
 Sale

 	
  

 	
 6

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 2.2

 	
  

 	
 Purchase
 Price

 	
  

 	
 6

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 2.3

 	
  

 	
 Allocation

 	
  

 	
 7

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 2.4

 	
  

 	
 Payment

 	
  

 	
 7

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 2.5

 	
  

 	
 Earnest
 Money Deposit

 	
  

 	
 7

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE III

 	
  

 	
 REVIEW PERIOD

 	
  

 	
 7

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 3.1

 	
  

 	
 Review
 Period

 	
  

 	
 7

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 3.2

 	
  

 	
 Due
 Diligence Examination

 	
  

 	
 9

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 3.3

 	
  

 	
 Restoration

 	
  

 	
 9

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 3.4

 	
  

 	
 Seller
 Exhibits

 	
  

 	
 9

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE IV

 	
  

 	
 SURVEY AND TITLE APPROVAL

 	
  

 	
 9

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 4.1

 	
  

 	
 Survey

 	
  

 	
 9

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 4.2

 	
  

 	
 Title

 	
  

 	
 9

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 4.3

 	
  

 	
 Survey or
 Title Objections

 	
  

 	
 10

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE V

 	
  

 	
 TERMINATION OF MANAGEMENT AGREEMENT

 	
  

 	
 10

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE VI

 	
  

 	
 BROKERS

 	
  

 	
 11

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE VII 

 	
  

 	
 REPRESENTATIONS, WARRANTIES AND COVENANTS

 	
  

 	
 11

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 7.1

 	
  

 	
 Seller’s
 Representations, Warranties and Covenants

 	
  

 	
 11

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 7.2

 	
  

 	
 Buyer’s
 Representations, Warranties and Covenants

 	
  

 	
 15

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 7.3

 	
  

 	
 Survival

 	
  

 	
 15

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE VIII
 

 	
  

 	
 ADDITIONAL COVENANTS

 	
  

 	
 16

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.1

 	
  

 	
 Subsequent
 Developments

 	
  

 	
 16

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.2

 	
  

 	
 Operations

 	
  

 	
 16

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.3

 	
  

 	
 Third Party
 Consents

 	
  

 	
 17

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.4

 	
  

 	
 Employees

 	
  

 	
 17

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.5

 	
  

 	
 Estoppel
 Certificates

 	
  

 	
 18

 

i

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.6

 	
  

 	
 Access to
 Financial Information

 	
  

 	
 18

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.7

 	
  

 	
 Bulk Sales

 	
  

 	
 18

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.8

 	
  

 	
 Indemnification

 	
  

 	
 18

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.9

 	
  

 	
 Escrow Funds

 	
  

 	
 21

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.10

 	
  

 	
 Liquor
 Licenses

 	
  

 	
 21

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE IX

 	
  

 	
 CONDITIONS FOR CLOSING

 	
  

 	
 21

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 9.1

 	
  

 	
 Buyer’s
 Conditions for Closing

 	
  

 	
 21

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 9.2

 	
  

 	
 Seller’s
 Conditions for Closing

 	
  

 	
 22

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE X

 	
  

 	
 CLOSING AND CONVEYANCE

 	
  

 	
 22

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 10.1

 	
  

 	
 Closing

 	
  

 	
 22

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 10.2

 	
  

 	
 Deliveries
 of Seller

 	
  

 	
 23

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 10.3

 	
  

 	
 Buyer’s
 Deliveries

 	
  

 	
 24

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE XI

 	
  

 	
 COSTS

 	
  

 	
 25

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 11.1

 	
  

 	
 Seller’s
 Costs

 	
  

 	
 25

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 11.2

 	
  

 	
 Buyer’s
 Costs

 	
  

 	
 25

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE XII 

 	
  

 	
 ADJUSTMENTS

 	
  

 	
 25

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 12.1

 	
  

 	
 Adjustments

 	
  

 	
 25

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 12.2

 	
  

 	
 Reconciliation
 and Final Payment

 	
  

 	
 27

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 12.3

 	
  

 	
 Employees

 	
  

 	
 27

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE XIII
 

 	
  

 	
 CASUALTY AND CONDEMNATION

 	
  

 	
 27

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 13.1

 	
  

 	
 Risk of
 Loss; Notice

 	
  

 	
 27

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 13.2

 	
  

 	
 Buyer’s
 Termination Right

 	
  

 	
 28

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 13.3

 	
  

 	
 Procedure
 for Closing

 	
  

 	
 28

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE XIV 

 	
 DEFAULT REMEDIES

 	
  

 	
 28

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 14.1

 	
  

 	
 Buyer
 Default

 	
  

 	
 28

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 14.2

 	
  

 	
 Seller
 Default

 	
  

 	
 29

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 14.3

 	
  

 	
 Attorney’s
 Fees

 	
  

 	
 29

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE XV 

 	
 NOTICES

 	
  

 	
 29

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE XVI 

 	
 MISCELLANEOUS

 	
  

 	
 30

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.1

 	
  

 	
 Performance

 	
  

 	
 30

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.2

 	
  

 	
 Binding
 Effect; Assignment

 	
  

 	
 30

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.3

 	
  

 	
 Entire
 Agreement

 	
  

 	
 30

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.4

 	
  

 	
 Governing
 Law

 	
  

 	
 30

 

ii

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.5

 	
  

 	
 Captions

 	
  

 	
 30

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.6

 	
  

 	
 Confidentiality

 	
  

 	
 30

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.7

 	
  

 	
 Closing
 Documents

 	
  

 	
 30

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.8

 	
  

 	
 Counterparts

 	
  

 	
 30

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.9

 	
  

 	
 Severability

 	
  

 	
 31

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.10

 	
  

 	
 Interpretation

 	
  

 	
 31

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.11

 	
  

 	
 (Intentionally
 Omitted)

 	
  

 	
 31

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.12

 	
  

 	
 Further Acts

 	
  

 	
 31

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.13

 	
  

 	
 Joint and
 Several Obligations

 	
  

 	
 31

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE XVII

 	
 LAFAYETTE CONTRACT

 	
  

 	
 31

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 SCHEDULES:

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Schedule 3.1

 	
 Due Diligence List

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 EXHIBITS:

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Exhibit A

 	
  

 	
 Legal Description

 	
  

 	
  

 
	
 Exhibit B

 	
  

 	
 List of FF&E

 	
  

 	
  

 
	
 Exhibit C

 	
  

 	
 List of Hotel Contracts

 	
  

 	
  

 
	
 Exhibit D

 	
  

 	
 Consents and Approvals

 	
  

 	
  

 
	
 Exhibit E

 	
  

 	
 Environmental Reports

 	
  

 	
  

 
	
 Exhibit F

 	
  

 	
 Claims or Litigation Pending

 	
  

 	
  

 
	
 Exhibit G

 	
  

 	
 Escrow Agreement

 	
  

 	
  

 

iii

PURCHASE CONTRACT

          This
PURCHASE CONTRACT (this “Contract”)
is made and entered into as of May 28, 2010, by and between LODGING AMERICA OF
WEST MONROE, LLC, a Louisiana limited liability company (“Seller”) with a principal office at
1554 West Peace Street, Canton, Mississippi 39046 and APPLE NINE HOSPITALITY
OWNERSHIP, INC., a Virginia corporation, with its principal office at 814 East
Main Street, Richmond, Virginia 23219, or its affiliates or assigns (“Buyer”). 

RECITALS

          A.
Seller is the fee simple owner of that certain 134-room hotel property commonly
known as the Hilton Garden Inn West Monroe located at 400 Mane Street, West
Monroe, Louisiana 71219 (the “Hotel”)
identified in on Exhibit A
attached hereto and incorporated by reference. 

          B.
Buyer is desirous of purchasing the Hotel from Seller, and Seller is desirous
of selling the Hotel to Buyer, for the purchase price and upon terms and
conditions hereinafter set forth. 

AGREEMENT:

          NOW,
THEREFORE, in consideration of the foregoing Recitals, the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree
as follows: 

ARTICLE I 

DEFINED TERMS

          1.1
Definitions. The following capitalized terms when used in this Contract
shall have the meanings set forth below unless the context otherwise requires: 

          “Additional
Deposit” shall mean $150,000. 

          “Affiliate”
shall mean, with respect to Seller or Buyer, any other person or entity
directly or indirectly controlling (including but not limited to all directors
and officers), controlled by or under direct or indirect common control with
Seller or Buyer, as applicable. For purposes of the foregoing, a person or
entity shall be deemed to control another person or entity if it possesses,
directly or indirectly, the power to direct or cause direction of the
management and policies of such other person or entity, whether through the
ownership of voting securities, by contract or otherwise. 

          “Appurtenances”
shall mean all rights, titles, and interests of Seller appurtenant to the Land
and Improvements, including, but not limited to, (i) all easements, rights of
way, rights of ingress and egress, tenements, hereditaments, privileges, and
appurtenances in any way belonging to the Land or Improvements, (ii) any land
lying in the bed of any alley, highway, street, road or avenue, open or
proposed, in front of or abutting or adjoining the Land, (iii) any 

1

strips or
gores of real estate adjacent to the Land, and (iv) the use of all alleys,
easements and rights-of-way, if any, abutting, adjacent, contiguous to or
adjoining the Land. 

          “Brand”
shall mean Hilton Garden Inn, the hotel brand or franchise under which the
Hotel operates.

          “Business Day” shall mean any day other than a Saturday, Sunday
or legal holiday in the Commonwealth of Virginia or the state in which the
Property is located. 

          “Closing” shall mean the closing of the purchase and sale
of the Property pursuant to this Contract.  

          “Closing
Date” shall have the meaning set forth in Section 10.1. 

          “Contracts,
Plans and Specs” shall mean all construction and other contracts, plans,
drawings, specifications, surveys, soil reports, engineering reports,
inspection reports, and other technical descriptions and reports. 

          “Deed”
shall have the meaning set forth in Section 10.2(a). 

          “Deposits”
shall mean, to the extent assignable, all prepaid rents and deposits
(including, without limitation, any reserves for replacement of FF&E and
for capital repairs and/or improvements), refundable security deposits and
rental deposits, and all other deposits for advance reservations, banquets or
future services, made in connection with the use or occupancy of the
Improvements; provided, however, that to the extent Seller has not received or
does not hold all of the prepaid rents and/or deposits attributable to the
Leases related to the Property, Buyer shall be entitled to a credit against the
cash portion of the Purchase Price allocable to the Property in an amount equal
to the amount of the prepaid rents and/or deposits attributable to the Leases
transferred at the Closing of such Property, and provided further, that “Deposits”
shall exclude (i) reserves for real property taxes and insurance, in each case,
to the extent pro rated on the settlement statement such that Buyer receives a
credit for (a) taxes and premiums in respect of any period prior to Closing and
(b) the amount of deductibles and other self-insurance and all other potential
liabilities and claims in respect of any period prior to Closing, and (ii)
utility deposits. 

          “Due
Diligence Examination” shall have the meaning set forth in Section 3.2. 

          “Earnest
Money Deposit” shall have the meaning set forth in Section 2.5(a). 

          “Environmental
Requirements” shall have the meaning set forth in Section 7.1(f) 

          “Escrow
Agent” shall have the meaning set forth in Section 2.5(a). 

          “Escrow
Agreement” shall have the meaning set forth in Section 2.5(b). 

          “Exception
Documents” shall have the meaning set forth in Section 4.2. 

2

          “Existing
Franchise Agreement” shall mean that certain franchise license agreement between
the Seller and the Franchisor, granting to Seller a franchise to operate the
Hotel under the Brand. 

          “Existing
Management Agreement” shall mean that certain management agreement between
the Seller and the Existing Manager for the operation and management of the
Hotel. 

          “Existing
Manager” shall mean Certified Hospitality Corporation. 

          “FF&E”
shall mean all tangible personal property and fixtures of any kind (other than
personal property (i) owned by guests of the Hotel or (ii) leased by Seller
pursuant to an FF&E Lease) attached to, or located upon and used in
connection with the ownership, maintenance, use or operation of the Land or
Improvements as of the date hereof (or acquired by Seller and so employed prior
to Closing), including, but not limited to, all furniture, fixtures, equipment,
signs and related personal property; all heating, lighting, plumbing, drainage,
electrical, air conditioning, and other mechanical fixtures and equipment and
systems; all elevators, and related motors and electrical equipment and
systems; all hot water heaters, furnaces, heating controls, motors and
equipment, all shelving and partitions, all ventilating equipment, and all
disposal equipment; all spa, health club and fitness equipment; all equipment
used in connection with the use and/or maintenance of the guestrooms,
restaurants, lounges, business centers, meeting rooms, swimming pools, indoor
and/or outdoor sports facilities and other common areas and recreational areas;
all carpet, drapes, beds, furniture, televisions and other furnishings; all
stoves, ovens, freezers, refrigerators, dishwashers, disposals, kitchen
equipment and utensils, tables, chairs, plates and other dishes, glasses,
silverware, serving pieces and other restaurant and bar equipment, apparatus
and utensils. A current list of FF&E is attached hereto as Exhibit B.

          “FF&E
Leases” shall mean all leases of any FF&E and other contracts
permitting the use of any FF&E at the Improvements that are assumed by
Buyer. 

          “Financial
Statements” shall have the meaning set forth in Section 3.1(b). 

          “Franchisor”
shall mean Hilton Garden Inns Franchise LLC. 

          “Hotel
Contracts” shall have the meaning set forth in Section 10.2(d). 

          “Improvements”
shall mean all buildings, structures, fixtures, parking areas and other
improvements to the Land, and all related facilities. 

          “Indemnification
Agreement” shall have the meaning set forth in Article XVII. 

          “Indemnified
Party” shall have the meaning set forth in Section 8.8(c)(i). 

          “Indemnifying
Party” shall have the meaning set forth in Section 8.8(c)(i). 

          “Initial
Deposit” shall have the meaning set forth in Section 2.5(a). 

          “Land”
shall mean, collectively, a fee simple absolute interest in the real property
more fully described in Exhibit A, which is attached hereto and incorporated
herein by reference,  

3

together with
all rights (including without limitation all air rights, mineral rights and development
rights), alleys, streets, strips, gores, waters, privileges, appurtenances,
advantages and easements belonging thereto or in any way appertaining thereto. 

          “Leases”
shall mean all leases, franchises, licenses, occupancy agreements, “trade-out”
agreements, advance bookings, convention reservations, or other agreements
demising space in, providing for the use or occupancy of, or otherwise
similarly affecting or relating to the use or occupancy of, the Improvements or
Land, together with all amendments, modifications, renewals and extensions
thereof, and all guaranties by third parties of the obligations of the tenants,
licensees, franchisees, concessionaires or other entities thereunder. 

          “Legal
Action” shall have the meaning set forth in Section 8.8(c)(ii). 

          “Licenses”
shall mean all permits, licenses, franchises, utility reservations,
certificates of occupancy, and other documents issued by any federal, state, or
municipal authority or by any private party related to the development,
construction, use, occupancy, operation or maintenance of the Hotel, including,
without limitation, all licenses, approvals and rights (including any and all
existing waivers of any brand standard) necessary or appropriate for the
operation of the Hotel under the Brand. 

          “Liquor
Licenses” shall have the meaning set forth in Section 8.10. 

          “Manager”
shall mean the management company selected by Buyer to manage the Hotel. 

          “New
Franchise Agreement” shall mean the franchise license agreement to be
entered into between Buyer and the Franchisor, granting to Buyer a franchise to
operate the Hotel under the Brand on and after the Closing Date. 

          “New
Management Agreement” means the management agreement to be entered into
between Buyer and the Manager for the operation and management of the Hotel on
and after the Closing Date. 

          “Other
Property” shall have the meaning set forth in Section 16.14.

          “Pending
Claims” shall have the meaning set forth in Section 7.1(e). 

          “Permitted
Exceptions” shall have the meaning set forth in Section 4.3.  

          “Personal
Property” shall mean, collectively, all of the Property other than the Real
Property. 

          “PIP”
shall mean a product improvement plan for any Hotel, as required by the
Existing Manager or the Franchisor, if any. 

          “Post-Closing
Agreement” shall have the meaning set forth in Section 8.9. 

          “Property”
shall mean, collectively, (i) all of the following with respect to the Hotel:
the Land, Improvements, Appurtenances, FF&E, Supplies, Leases, Deposits,
Records, Service 

4

Contracts,
Warranties, Licenses, FF&E Leases, Contracts, Plans and Specs, Tradenames,
Utility Reservations, as well as all other real, personal or intangible
property of Seller related to any of the foregoing and (ii) any and all of the
following that relate to or affect in any way the design, construction,
ownership, use, occupancy, leasing, maintenance, service or operation of the
Real Property, FF&E, Supplies, Leases, Deposits or Records: Service
Contracts, Warranties, Licenses, Tradenames, Contracts, Plans and Specs and
FF&E Lease. 

          “Purchase
Price” shall have the meaning set forth in Section 2.2. 

          “Real
Property” shall mean, collectively, all Land, Improvements and
Appurtenances with respect to the Hotel. 

          “Records”
shall mean all books, records, promotional material, tenant data, guest history
information (other than any such information owned exclusively by the Existing
Manager), marketing and leasing material and forms (including but not limited
to any such records, data, information, material and forms in the form of
computerized files located at the Hotel), market studies prepared in connection
with Seller’s current annual plan and other materials, information, data, legal
or other documents or records (including, without limitation, all documentation
relating to any litigation or other proceedings, all zoning and/or land use
notices, relating to or affecting the Property, all business plans and
projections and all studies, plans, budgets and contracts related to the
development, construction and/or operation of the Hotel) owned by Seller and/or
in Seller’s possession or control, or to which Seller has access or may obtain
from the Existing Manager, that are used in or relating to the Property and/or
the operation of the Hotel, including the Land, the Improvements or the
FF&E, and proforma budgets and projections and construction budgets and
contracts related to the development and construction of the Hotel and a list
of the general contractors, architects and engineers providing goods and/or
services in connection with the construction of the Hotel, all construction
warranties and guaranties in effect at Closing and copies of the final plans
and specifications for the Hotel. 

          “Release”
shall have the meaning set forth in Section 7.1(f). 

          “Review
Period” shall have the meaning set forth in Section 3.1. 

          “SEC”
shall have the meaning set forth in Section 8.6. 

          “Seller
Liens” shall have the meaning set forth in Section 4.3. 

          “Seller
Parties” shall have the meaning set forth in Section 7.1(e). 

          “Service
Contracts” shall mean contracts or agreements, such as maintenance, supply,
service or utility contracts. 

          “Supplies”
shall mean all merchandise, supplies, inventory and other items used for the
operation and maintenance of guest rooms, restaurants, lounges, swimming pools,
health clubs, spas, business centers, meeting rooms and other common areas and
recreational areas located within or relating to the Improvements, including,
without limitation, all food and beverage (alcoholic and non-alcoholic)
inventory (opened or unopened), office supplies and stationery, advertising and
promotional materials, china, glasses, silver/flatware, towels, linen and
bedding 

5

(all of which
shall be 2-par level for all suites or rooms in the Hotel), guest cleaning,
paper and other supplies, upholstery material, carpets, rugs, furniture,
engineers’ supplies, paint and painters’ supplies, employee uniforms, and all
cleaning and maintenance supplies, including those used in connection with the
swimming pools, indoor and/or outdoor sports facilities, health clubs, spas,
fitness centers, restaurants, business centers, meeting rooms and other common
areas and recreational areas. 

          “Survey”
shall have the meaning set forth in Section 4.1. 

          “Third
Party Consents” shall have the meaning set forth in Section 8.3. 

          “Title
Commitment” shall have the meaning set forth in Section 4.2. 

          “Title
Company” shall have the meaning set forth in Section 4.2. 

          “Title
Policy” shall have the meaning set forth in Section 4.2. 

          “Title
Review Period” shall have the meaning set forth in Section 4.3. 

          “Tradenames”
shall mean all telephone exchanges and numbers, trade names, trade styles,
trade marks, and other identifying material, and all variations thereof,
together with all related goodwill (it being understood and agreed that the
name of the hotel chain to which the Hotel is affiliated by franchise, license
or management agreement is a protected name or registered service mark of such
hotel chain and cannot be transferred to Buyer by this Contract, provided that
all such franchise, license, management and other agreements granting a right
to use the name of such hotel chain or any other trademark or trade name and
all waivers of any brand standard shall be assigned to Buyer. 

          “Utility
Reservations” shall mean Seller’s interest in the right to receive
immediately on and after Closing and continuously consume thereafter water
service, sanitary and storm sewer service, electrical service, gas service and
telephone service on and for the Land and Improvements in capacities that are
adequate continuously to use and operate the Improvements for the purposes for
which they were intended, including, but not limited to (i) any right to the
present and future use of wastewater, drainage, water and other utility
facilities to the extent such use benefits the Real Property, (ii) any
reservations of or commitments covering any such use in the future, and (iii)
any wastewater capacity reservations relating to the Real Property. Buyer shall
be responsible for any requests or documents to transfer the Utility
Reservations, at Buyer’s sole cost and expense. 

          “Warranties”
shall mean all warranties, guaranties, indemnities and claims for the benefit
of Seller with respect to the Hotel, the Property or any portion thereof,
including, without limitation, all warranties and guaranties of the
development, construction, completion, installation, equipping and furnishing
of the Hotel, and all indemnities, bonds and claims of Seller related thereto. 

6

ARTICLE II

PURCHASE AND SALE; PURCHASE PRICE; PAYMENT; 

EARNEST MONEY DEPOSIT

          2.1
Purchase and Sale. Seller agrees to sell and convey to Buyer or its
Affiliates and/or assigns, and Buyer or its assigns agrees to purchase from
Seller, the Property, in consideration of the Purchase Price and upon the terms
and conditions hereof. All of the Property shall be conveyed, assigned, and
transferred to Buyer at Closing, free and clear of all mortgages, liens,
encumbrances, licenses, franchises (other than any hotel franchises assumed by
Buyer), concession agreements, security interests, prior assignments or
conveyances, conditions, restrictions, rights-of-way, easements, encroachments,
claims and other matters affecting title or possession, except for the
Permitted Exceptions. 

          2.2
Purchase Price. Buyer agrees to pay, and Seller agrees to accept, as
consideration for the conveyance of the Property, subject to the adjustments
provided for in this Contract, the amount of TEN MILLION and No/100 Dollars
($10,000,000.00) (the “Purchase Price”).

          2.3
Allocation. Buyer and Seller shall attempt to agree, prior to the
expiration of the Review Period, on an allocation of the Purchase Price among
Real Property, tangible Personal Property and intangible property related to
the Property. In the event Buyer and Seller do not agree, each party shall be
free to allocate the Purchase Price to such items as they deem appropriate,
subject to and in accordance with applicable laws. 

          2.4
Payment. The portion of the Purchase Price, less the Earnest Money
Deposit and interest earned thereon, if any, which Buyer elects to have applied
against the Purchase Price (as provided below), less the Escrow Funds, shall be
paid to Seller in cash, certified funds or wire transfer, at the Closing of the
Property. At the Closing, the Earnest Money Deposit, together with interest
earned thereon, if any, shall, at Buyer’s election, be returned to Buyer or
shall be paid over to Seller by Escrow Agent to be applied to the portion of the
Purchase Price on behalf of Buyer, and the Escrow Funds shall be deposited into
an escrow account pursuant to the Post-Closing Agreement as contemplated by
Section 8.9. 

          2.5
Earnest Money Deposit. 

                    (a)
Within three (3) Business Days after the full execution and delivery of this
Contract, Buyer shall deposit the sum of One Hundred Fifty Thousand and No/100
Dollars ($150,000.00) in cash, certified bank check or by wire transfer of
immediately available funds (the “Initial
Deposit”) with the Title Company, as escrow agent (“Escrow Agent”), which sum shall be held
by Escrow Agent as earnest money. If, pursuant to the provisions of Section 3.1
of this Contract, Buyer elects to terminate this Contract at any time prior to
the expiration of the Review Period, then the Escrow Agent shall return the
Earnest Money Deposit to Buyer promptly upon written notice to that effect from
Buyer. If Buyer does not elect to terminate this Contract on or before the
expiration of the Review Period, Buyer shall, within three (3) Business Days
after the expiration of the Review Period deposit the Additional Deposit with
the Escrow Agent. The Initial Deposit and the Additional Deposit, and all
interest accrued thereon, shall hereinafter be referred to as the “Earnest Money Deposit.” 

7

                    (b)
The Earnest Money Deposit shall be held by Escrow Agent subject to the terms
and conditions of an Escrow Agreement dated as of the date of this Contract
entered into by Seller, Buyer and Escrow Agent (the “Escrow Agreement”). The Earnest Money
Deposit shall be held in an interest-bearing account in a federally insured
bank or savings institution reasonably acceptable to Seller and Buyer, with all
interest to accrue to the benefit of the party entitled to receive it and to be
reportable by such party for income tax purposes. 

ARTICLE III 

REVIEW PERIOD

          3.1
Review Period. Buyer shall have a period through 6:00 p.m. Eastern Time
on the date that is forty-five (45) days after the date of this Contract,
unless a longer period of time is otherwise provided for in this Contract and
except as otherwise agreed to by Buyer and Seller (the “Review Period”), to evaluate the legal,
title, survey, construction, physical condition, structural, mechanical, environmental,
economic, permit status, franchise status, financial and other documents and
information related to the Property. Within two (2) Business Days following the
date of this Contract, Seller, at Seller’s sole cost and expense, will deliver
to Buyer (or make available at the Hotel) for Buyer’s review, to the extent not
previously delivered to Buyer, true, correct and complete copies of the
following, together with all amendments, modifications, renewals or extensions
thereof: 

                    (a)
All Warranties and Licenses relating to the Hotel or any part thereof; 

                    (b)
Income and expense statements and budgets for the Hotel, for the current year
to date and each of the three (3) prior fiscal years (the “Financial Statements”), and Seller
shall provide to Buyer copies of all income and expense statements generated by
Seller or any third party that relate to the operations of the Hotel and that
contain information not included in the financial statements, if any, provided
to Buyer by the Existing Manager, provided that Seller also agrees to provide
to Buyer’s auditors and representatives all financial and other information
necessary or appropriate for preparation of audited financial statements for
Buyer and/or its Affiliates as provided in Section 8.6, below; 

                    (c)
All real estate and personal property tax statements with respect to the Hotel
and notices of appraised value for the Real Property for the current year (if
available) and each of the three (3) calendar years prior to the current year; 

                    (d)
Engineering, mechanical, architectural and construction plans, drawings,
specifications and contracts, payment and performance bonds, title policies,
reports and commitments, zoning information and marketing and economic data
relating to the Hotel and the construction, development, installation and
equipping thereof, as well as copies of all environmental reports and
information, topographical, boundary or “as built” surveys, engineering reports,
subsurface studies and other Contracts, Plans and Specs relating to or
affecting the Hotel. If the Hotel is purchased by Buyer, all such documents and
information relating to the Hotel shall thereupon be and become the property of
Buyer without payment of any additional consideration therefor; 

8

                    (e)
All FF&E Leases, Services Contracts, Leases and, if applicable, a schedule
of such Leases of space in the Hotel, and all agreements for real estate
commissions, brokerage fees, finder’s fees or other compensation payable by
Seller in connection therewith; and 

                    (f)
All notices received from governmental authorities in connection with the Hotel
and all other notices received from governmental authorities received at any time
that relate to any noncompliance or violation of law that has not been
corrected. 

                    (g)
Any other information described on Schedule 3.1 attached hereto. 

          Seller
shall, upon request of Buyer, make available to Buyer and Buyer’s
representatives and agents, for inspection and copying during normal business
hours, Records located at Seller’s corporate offices, and Seller agrees to
provide Buyer copies of all other reasonably requested information that is
relevant to the management, operation, use, occupancy or leasing of or title to
the applicable Hotel and the plans specifications for development of the Hotel.
At any time during the Review Period, Buyer may, in its sole and absolute
discretion, elect not to proceed with the purchase of the Property for any
reason whatsoever by giving written notice thereof to Seller, in which event:
(i) the Earnest Money Deposit shall be promptly returned by Escrow Agent to
Buyer together with all accrued interest, if any, (ii) this Contract shall be
terminated automatically, (iii) all materials supplied by Seller to Buyer shall
be returned promptly to Seller, and (iv) both parties will be relieved of all
other rights, obligations and liabilities hereunder, except for the parties’
obligations pursuant to Sections 3.3 and 16.6 below. 

          3.2
Due Diligence Examination. At any time during the Review Period, and
thereafter through Closing of the Property, Buyer and/or its representatives
and agents shall have the right to enter upon the Property at all reasonable
times for the purposes of reviewing all Records and other data, documents
and/or information relating to the Property and conducting such surveys,
appraisals, engineering tests, soil tests (including, without limitation, Phase
I and Phase II environmental site assessments), inspections of construction and
other inspections and other studies as Buyer deems reasonable and necessary or
appropriate to evaluate the Property, subject to providing reasonable advance
notice to Seller unless otherwise agreed to by Buyer and Seller (the “Due Diligence Examination”). Seller
shall have the right to have its representative present during Buyer’s physical
inspections of its Property, provided that failure of Seller to do so shall not
prevent Buyer from exercising its due diligence, review and inspection rights
hereunder. Buyer agrees to exercise reasonable care when visiting the Property,
in a manner which shall not materially adversely affect the operation of the
Property. 

          3.3
Restoration. Buyer covenants and agrees not to damage or destroy any
portion of the Property in conducting its examinations and studies of the
Property during the Due Diligence Examination and, if closing does not occur,
shall repair any portion of the Property damaged by the conduct of Buyer, its
agents or employees, to substantially the condition such portion(s) of the
Property were in immediately prior to such examinations or studies. 

          3.4
Seller Exhibits. Buyer shall have until the end of the Review Period to
review and approve the information on Exhibits B, C, D, E and F. In the event
Buyer does not approve any such Exhibit or the information contained therein,
Buyer shall be entitled to terminate this 

9

Contract by
notice to Seller and the Earnest Money Deposit shall be returned to Buyer with
all interest thereon and both parties shall be relieved of all rights,
obligations and liabilities hereunder except for the parties’ obligations
pursuant to Sections 3.3 and 16.6. 

ARTICLE IV

SURVEY AND TITLE APPROVAL

          4.1
Survey. Seller has delivered to Buyer true, correct and complete copies
of the most recent surveys of the Real Property. In the event that an update of
the survey or a new survey (such updated or new surveys being referred to as
the “Survey”) are desired
by Buyer, then Buyer shall be responsible for all costs related thereto. 

          4.2
Title. Seller has delivered to Buyer its existing title insurance
policy, including copies of all documents referred to therein, for its Real
Property. Buyer’s obligations under this Contract are conditioned upon Buyer
being able to obtain for the Property (i) a Commitment for Title Insurance (the
“Title Commitment”) issued
by Chicago Title Company, Attn: Debby Moore, 5501 LBJ Freeway, Ste. 200,
Dallas, Texas 75240 (the “Title Company”),
for the most recent standard form of owner’s policy of title insurance in the
state in which the Real Property is located, covering the Real Property,
setting forth the current status of the title to the Real Property, showing all
liens, claims, encumbrances, easements, rights of way, encroachments,
reservations, restrictions and any other matters affecting the Real Property
and pursuant to which the Title Company agrees to issue to Buyer at Closing an
Owner’s Policy of Title Insurance on the most recent form of ALTA (where
available) owner’s policy available in the state in which the Land is located,
with extended coverage and, to the extent applicable and available in such
state, comprehensive, access, single tax parcel, survey, contiguity, and such
other endorsements as may be required by Buyer (collectively, the “Title Policy”); and (ii) true,
complete, legible and, where applicable, recorded copies of all documents and
instruments (the “Exception Documents”)
referred to or identified in the Title Commitment, including, but not limited
to, all deeds, lien instruments, leases, plats, surveys, reservations,
restrictions, and easements affecting the Real Property. 

          4.3
Survey or Title Objections. If Buyer discovers any title or survey
matter which is objectionable to Buyer, Buyer may provide Seller with written
notice of its objection to same on or before the expiration of the Review
Period (the “Title Review Period”).
If Buyer fails to so object in writing to any such matter set forth in the
Survey or Title Commitment, it shall be conclusively assumed that Buyer has
approved same. If Buyer disapproves any condition of title, survey or other
matters by written objection to Seller on or before the expiration of the Title
Review Period, Seller shall elect either to attempt to cure or not cure any
such item by written notice sent to Buyer within five (5) days after its
receipt of notice from Buyer, and if Seller commits in writing to attempt to
cure any such item, then Seller shall be given until the Closing Date to cure
any such defect. In the event Seller shall fail to cure a defect which Seller
has committed in writing to cure prior to Closing, or if a new title defect
arises after the date of Buyer’s Title Commitment or Survey, as applicable, but
prior to Closing, then Buyer may elect, in Buyer’s sole and absolute
discretion: (i) to waive such objection and proceed to Closing, or (ii) to
terminate this Contract and receive a return of the Earnest Money Deposit, and
any interest thereon. The items shown on the Title Commitment which are not
objected to by Buyer as set forth above (other than exceptions and title
defects arising after the title review period and other 

10

than those
standard exceptions which are ordinarily and customarily omitted in the state
in which the applicable Hotel is located, so long as Seller provides the
appropriate owner’s affidavit, gap indemnity or other documentation reasonably
required by the Title Company for such omission) are hereinafter referred to as
the “Permitted Exceptions.”
In no event shall Permitted Exceptions include liens, or documents evidencing
liens, securing any indebtedness (including vehicle or FF&E leases or
financing arrangements) any mechanics’ or materialmen’s liens or any claims or
potential claims therefor covering the Property or any portion thereof (“Seller Liens”), each of which shall be
paid in full by Seller and released at Closing. If a vehicle or FF&E lease
or other financing cannot be released at Closing, Seller shall credit Buyer at
Closing with the amount necessary to fully pay off such lease or financing over
its term. 

ARTICLE V

MANAGEMENT AGREEMENT AND FRANCHISE AGREEMENT

          At
or prior to the Closing, Seller shall terminate the Existing Management Agreement
and the Existing Franchise Agreement, and Seller shall be solely responsible
for all claims and liabilities arising thereunder on, prior to or following the
Closing Date. As a condition to Closing, Buyer shall enter into the New
Management Agreement and the New Franchise Agreement, effective as of the
Closing Date, containing terms and conditions acceptable to Buyer (including,
without limitation, such terms and conditions as may be required to accommodate
Buyer’s and/or Buyer’s Affiliates’ REIT structure). Seller shall be responsible
for paying all costs related to the termination of the Existing Management
Agreement. Buyer shall be responsible for paying all reasonable and actual
costs of the Franchisor related to the assignment or termination, as
applicable, of the Existing Franchise Agreement. Seller shall use best efforts
to promptly provide all information required by the Franchisor in connection
with the New Franchise Agreement, and Seller and Buyer shall diligently pursue
obtaining each the same. As a condition to Buyer’s and Seller’s obligation to
close under this Contract, Buyer and Manager shall agree, on or before the
expiration of the Review Period, on the form and substance of the New
Management Agreement. 

ARTICLE VI 

BROKERS

          Seller
and Buyer each represents and warrants to the other that, except for Hotel
Assets Group, L.L.C. (Keith Thompson) for who’s fees and commissions Seller
shall be solely responsible, it has not engaged any broker, finder or other
party in connection with the transaction contemplated by this Contract. Buyer
and Seller each agree to save and hold the other harmless from any and all
losses, damages, liabilities, costs and expenses (including, without
limitation, attorneys’ fees) involving claims made by any other agent, broker,
or other person by or through the acts of Buyer or Seller, respectively, in
connection with this transaction. 

ARTICLE VII

REPRESENTATIONS, WARRANTIES AND COVENANTS

          7.1
Seller’s Representations, Warranties and Covenants. Seller hereby
represents, warrants and covenants to Buyer as follows: 

11

                    (a)
Authority; No Conflicts. Seller is a limited liability company duly
formed, validly existing and in good standing in the State of Louisiana. Seller
has obtained all necessary consents to enter into and perform this Contract and
is fully authorized to enter into and perform this Contract and to complete the
transactions contemplated by this Contract. No consent or approval of any
person, entity or governmental authority is required for the execution,
delivery or performance by Seller of this Contract, except as set forth in Exhibit
D, and this Contract is hereby binding and enforceable against Seller.
Neither the execution nor the performance of, or compliance with, this Contract
by Seller has resulted, or will result, in any violation of, or default under,
or acceleration of, any obligation under any existing corporate charter,
certificate of incorporation, bylaw, articles of organization, limited
liability company agreement or regulations, partnership agreement or other
organizational documents and under any, mortgage indenture, lien agreement,
promissory note, contract, or permit, or any judgment, decree, order,
restrictive covenant, statute, rule or regulation, applicable to Seller or to
the Hotel. 

                    (b)
FIRPTA. Seller is not a foreign corporation, foreign partnership,
foreign trust or foreign estate (as those items are defined in the Internal
Revenue Code and Income Tax Regulations). 

                    (c)
Bankruptcy. None of Seller, or, to Seller’s knowledge, any of its
partners or members, is insolvent or the subject of any bankruptcy proceeding,
receivership proceeding or other insolvency, dissolution, reorganization or
similar proceeding. 

                    (d)
Property Agreements. A complete list of all FF&E Leases, Service
Contracts and Leases (other than those entered into by the Existing Manager on
its own behalf) used in or otherwise relating to the operation and business of
the Hotel is attached hereto as Exhibit C-1, and, to Seller’s knowledge,
a complete list of all other FF&E Leases, Service Contracts and Leases used
in or otherwise relating to the operation and business of the Hotel is attached
hereto as Exhibit C-2. The assets constituting the Property to be
conveyed to Buyer hereunder constitute all of the property and assets of Seller
used in connection with the operation and business of the Hotel. There are no
leases, license agreements, leasing agent’s agreements, equipment leases,
building service agreements, maintenance contracts, suppliers contracts,
warranty contracts, operating agreements, or other agreements (i) to which
Seller is a party or an assignee, or (ii) to Seller’s knowledge, binding upon
the Hotel, relating to the ownership, occupancy, operation, management or
maintenance of the Real Property, FF&E, Supplies or Tradenames, except for
those Service Contracts, Leases, Warranties and FF&E Leases disclosed on
Exhibit C or to be delivered to Buyer pursuant to Section 3.1. The Service
Contracts, Leases, Warranties and FF&E Leases disclosed on Exhibit C or
to be delivered to Buyer pursuant to Section 3.1 are in full force and effect,
and no default has occurred and is continuing thereunder and no circumstances
exist which, with the giving of notice, the lapse of time or both, would
constitute such a default. No party has any right or option to acquire the
Hotel or any portion thereof, other than Buyer.  

                    (e)
Pending Claims. There are no: (i) claims, demands, litigation,
proceedings or governmental investigations pending or threatened against
Seller, the Existing Manager or any Affiliate of any of them (collectively, “Seller Parties”) or related to the
business or assets of the Hotel, except as set forth on Exhibit F
attached hereto and incorporated herein by 

12

 reference, (ii) special assessments or
extraordinary taxes except as set forth in the Title Commitment or (iii)
pending or threatened condemnation or eminent domain proceedings which would affect
the Property or any part thereof. There are no: pending arbitration proceedings
or unsatisfied arbitration awards, or judicial proceedings or orders respecting
awards, which might become a lien on the Property or any portion thereof,
pending unfair labor practice charges or complaints, unsatisfied unfair labor
practice orders or judicial proceedings or orders with respect thereto, pending
charges or complaints with or by city, state or federal civil or human rights
agencies, unremedied orders by such agencies or judicial proceedings or orders
with respect to obligations under city, state or federal civil or human rights
or antidiscrimination laws or executive orders affecting the Hotel, or other
pending, actual or, to Seller’s knowledge, threatened litigation claims,
charges, complaints, petitions or unsatisfied orders by or before any
administrative agency or court which affect the Hotel or might become a lien on
the Hotel (collectively, the “Pending
Claims”). 

                    (f)
Environmental. With respect to environmental matters, (i) there has been
no Release or threat of Release of Hazardous Materials in, on, under, to, from
or in the area of the Real Property, except as disclosed in the reports and
documents set forth on Exhibit E attached hereto and incorporated herein
by reference, (ii) no portion of the Property is being used for the treatment,
storage, disposal or other handling of Hazardous Materials or machinery
containing Hazardous Materials other than standard amounts of cleaning supplies
and chlorine for the swimming pool, all of which are stored on the Property in
strict accordance with applicable Environmental Requirements and do not exceed
limits permitted under applicable laws, including without limitation
Environmental Requirements, (iii) no underground storage tanks are currently
located on or in the Real Property or any portion thereof, (iv) no
environmental investigation, administrative order, notification, consent order,
litigation, claim, judgment or settlement with respect to the Property or any
portion thereof is pending or threatened, (v) there is not currently and, to
Seller’s knowledge, never has been any mold, fungal or other microbial growth
in or on the Real Property, or existing conditions within buildings, structures
or mechanical equipment serving such buildings or structures, that could
reasonably be expected to result in material liability or material costs or
expenses to remediate the mold, fungal or microbial growth, or to remedy such
conditions that could reasonably be expected to result in such growth, and (vi)
except as disclosed on Exhibit E, there are no reports or other
documentation regarding the environmental condition of the Real Property in the
possession of Seller or Seller’s Affiliates, consultants, contractors or
agents. As used in this Contract: “Hazardous
Materials” means (1) “hazardous wastes” as defined by the
Resource Conservation and Recovery Act of 1976, as amended from time to time
(“RCRA”), (2) “hazardous substances” as defined by the Comprehensive
Environmental Response, Compensation and Liability Act of 1980 (42 U.S.C. 9601
et seq.), as amended by the Superfund Amendment and Reauthorization Act of 1986
and as otherwise amended from time to time (“CERCLA”); (3) “toxic substances” as defined by the Toxic
Substances Control Act, as amended from time to time (“TSCA”), (4) “hazardous materials” as
defined by the Hazardous Materials Transportation Act, as amended from time to
time (“HMTA”), (5)
asbestos, oil or other petroleum products, radioactive materials, urea
formaldehyde foam insulation, radon gas and transformers or other equipment
that contains dielectric fluid containing polychlorinated biphenyls and (6) any
substance whose presence is detrimental or hazardous to health or the
environment, including, without limitation, microbial or fungal matter or mold,
or is otherwise regulated by federal, state and local  

13

environmental
laws (including, without limitation, RCRA, CERCLA, TSCA, HMTA), rules,
regulations and orders, regulating, relating to or imposing liability or
standards of conduct concerning any Hazardous Materials or environmental,
health or safety compliance (collectively, “Environmental Requirements”). As used in this Contract: “Release” means spilling, leaking,
pumping, pouring, emitting, emptying, discharging, injecting, escaping,
leaching, dumping or disposing. 

                    (g)
Title and Liens. Except for Seller Liens to be released at Closing,
Seller has good and marketable fee simple absolute title to the Real Property,
subject only to the Permitted Exceptions. Except for the FF&E subject to
the FF&E Leases and any applicable Permitted Exceptions, Seller has good
and marketable title to the Personal Property, free and clear of all liens,
claims, encumbrances or other rights whatsoever (other than the Seller Liens
which must be released at Closing), and there are no other liens, claims,
encumbrances or other rights pending or of which any Seller Party has received
notice or which are otherwise known to any Seller Party related to any other
Personal Property. 

                    (h)
Utilities. All appropriate utilities, including sanitary and storm
sewers, water, gas, telephone, cable and electricity, are, to Seller’s
knowledge, currently sufficient and available to service the Hotel and all
installation, connection or “tap-on”, usage and similar fees have been paid. 

                    (i)
Licenses, Permits and Approvals. Seller has not received any written
notice, and Seller has no knowledge that the Property fails to comply with all
applicable licenses, permits and approvals and federal, state or local
statutes, laws, ordinances, rules, regulations, requirements and codes
including, without limitation, those regarding zoning, land use, building,
fire, health, safety, environmental, subdivision, water quality, sanitation
controls and the Americans with Disabilities Act, and similar rules and
regulations relating and/or applicable to the ownership, use and operation of
the Property as it is now operated. Seller has received all licenses, permits
and approvals required or needed for the lawful conduct, occupancy and
operation of the business of the Hotel, and each license and permit is in full
force and effect, and will be received and in full force and effect as of the
Closing. No licenses, permits or approvals necessary for the lawful conduct,
occupancy or operation of the business of the Hotel, to Seller’s knowledge
requires any approval of a governmental authority for transfer of the Property
except as set forth in Exhibit D.  

                    (j)
Financial Statements. Seller has delivered copies of all prior and
current (i) Financial Statements for the Hotel, (ii) operating statements
prepared by the Existing Manager for the Hotel, and (iii) monthly financial
statements prepared by the Existing Manager for the Hotel. Each of such
statements is, to Seller’s knowledge, complete and accurate in all material
respects and, except in the case of budgets prepared in advance of the
applicable operating period to which such budgets relate, fairly presents the
results of operations of the Hotel for the respective periods represented
thereby. Seller has relied upon the Financial Statements in connection with its
ownership and operation of the Hotel, and there are no independent audits or
financial statements prepared by third parties relating to the operation of the
Hotel other than the Financial Statements prepared by or on behalf of the
Existing Manager, all of which have been provided to Buyer. 

14

                    (k)
Employees. All employees employed at the Hotel are the employees of the
Existing Manager. There are, to Seller’s knowledge, no (i) unions organized at
the Hotel, (ii) union organizing attempts, strikes, organized work stoppages or
slow downs, or any other labor disputes pending or threatened with respect to
any of the employees at the Hotel, or (iii) collective bargaining or other
labor agreements to which Seller or the Existing Manager or the Hotel is bound
with respect to any employees employed at the Hotel. 

                    (l)
Operations. The Hotel has at all times been operated by Existing Manager
in accordance with all applicable laws, rules, regulations, ordinances and
codes. 

                    (m)
Existing Management and Franchise Agreements. Seller has furnished to
Buyer true and complete copies of the Existing Management Agreement and the
Existing Franchise Agreement, which constitutes the entire agreement of the
parties thereto with respect to the subject matter thereof and which have not
been amended or supplemented in any respect. There are no other management
agreements, franchise agreements, license agreements or similar agreements for
the operation or management of the Hotel or relating to the Brand, to which
Seller is a party or which are binding upon the Property, except for the
Existing Management Agreement and the Existing Franchise Agreement. The
Improvements comply with, and the Hotel is being operated in accordance with,
all requirements of such Existing Management Agreement and the Existing
Franchise Agreement and all other requirements of the Existing Manager and the
Franchisor, including all “brand standard” requirements of the Existing Manager
and the Franchisor. The Existing Management Agreement and the Existing
Franchise Agreement are in full force and effect, and shall remain in full
force and effect until the termination of the Existing Management Agreement and
the Existing Franchise Agreement at Closing, as provided in Article V hereof.
No default has occurred and is continuing under the Existing Management
Agreement or the Existing Franchise Agreement, and no circumstances exist
which, with the giving of notice, the lapse of time or both, would constitute
such a default. 

                    (n)
Construction of Hotel. 

	
  

 	
  

 
	
  

 	
                     (i)
 The Hotel has been constructed in a good and workmanlike manner without
 encroachments and in accordance in all material respects with the Contracts,
 Plans and Specs, and all building permits and certificates of occupancy
 therefor and all applicable zoning, platting, subdivision, health, safety and
 similar laws, rules, regulations, ordinances and codes. 

 
	
  

 	
  

 
	
  

 	
                     (ii)
 The Personal Property is in good condition and operating order. 

 
	
  

 	
  

 
	
  

 	
                     (iii)
 Necessary easements for ingress and egress, drainage, signage and utilities
 serving the Hotel have either been dedicated to the public, conveyed to the
 appropriate utility or will be conveyed to Buyer along with the Property. 

 

15

          7.2
Buyer’s Representations, Warranties and Covenants. Buyer represents,
warrants and covenants: 

                    (a)
Authority. Buyer is a corporation duly formed, validly existing and in
good standing in the Commonwealth of Virginia. Buyer has received or will have
received by the applicable Closing Date all necessary authorization of the
Board of Directors of Buyer to complete the transactions contemplated by this
Contract. No other consent or approval of any person, entity or governmental
authority is required for the execution, delivery or performance by Buyer of
this Contract, and this Contract is hereby binding and enforceable against
Buyer. 

                    (b)
Bankruptcy. Buyer is not insolvent nor the subject of any bankruptcy
proceeding, receivership proceeding or other insolvency, dissolution,
reorganization or similar proceeding. 

          7.3
Survival. All of the representations and warranties are true, correct
and complete in all material respects as of the date hereof and the statements
set forth therein (without qualification or limitation as to a party’s
knowledge thereof except as expressly provided for in this Article VII) shall
be true, correct and complete in all material respects as of the Closing Date.
All of the representations and warranties made herein shall survive Closing for
a period of two (2) years and shall not be deemed to merge into or be waived by
the Deed or any other closing documents. 

ARTICLE VIII 

ADDITIONAL COVENANTS

          8.1
Subsequent Developments. After the date of this Contract and until the
Closing Date, Seller shall use best efforts to keep Buyer fully informed of all
subsequent developments of which Seller has knowledge (“Subsequent Developments”) which would
cause any of Seller’s representations or warranties contained in this Contract
to be no longer accurate in any material respect. 

          8.2
Operations. From and after the date hereof through the Closing on the
Property, Seller shall comply with the Existing Management Agreement and the
Existing Franchise Agreement and keep the same in full force and effect and
shall perform and comply with all of the following subject to and in accordance
with the terms of such agreements: 

                    (a)
Continue to maintain the Property generally in accordance with prudent business
practices and pursuant to and in compliance with the Existing Management
Agreement and the Existing Franchise Agreement, including, without limitation,
(i) using reasonable efforts to keep available the services of all present
employees at the Hotel and to preserve its relations with guests, suppliers and
other parties doing business with Seller with respect to the Hotel, (ii)
accepting booking contracts for the use of the Hotel’s facilities retaining
such bookings in accordance with the terms of the Existing Management Agreement
and the Existing Franchise Agreement, (iii) maintaining the current level of
advertising and other promotional activities for the Hotel’s facilities, (iv)
maintaining the present level of insurance with respect to the Hotel in full
force and effect until the Closing Date for the Hotel and (v) remaining in
compliance in all material respects with all current Licenses; 

16

                    (b)
Keep, observe, and perform in all material respects all its obligations under
and pursuant to the Leases, the Service Contracts, the FF&E Leases, the
Existing Management Agreement, the Existing Franchise Agreement, the Contracts,
Plans and Specs, the Warranties and all other applicable contractual
arrangements relating to the Hotel; 

                    
(c) Not cause or permit the removal of FF&E from the Hotel except for the
purpose of discarding worn and valueless items that have been replaced with
FF&E of equal or better quality; timely make all repairs, maintenance, and
replacements to keep all FF&E and all other Personal Property and all Real
Property in good operating condition; keep and maintain the Hotel in a good state
of repair and condition, reasonable and ordinary wear and tear excepted; and
not commit waste of any portion of the Hotel; 

                    
(d) Maintain the levels and quality of the Personal Property generally at the
levels and quality existing on the date hereof and keep merchandise, supplies
and inventory adequately stocked, consistent with good business practice, as if
the sale of the Hotel hereunder were not to occur, including, without
limitation, maintaining linens and bath towels at least at a 2-par level for
all suites or rooms of the Hotel; 

                    
(e) Advise Buyer promptly of any litigation, arbitration, or administrative
hearing before any court or governmental agency concerning or affecting the
Hotel which is instituted or threatened after the date of this Contract or if
any representation or warranty contained in this Contract shall become false; 

                    
(f) Not take, or purposefully omit to take, any action that would have the
effect of violating any of the representations, warranties, covenants or
agreements of Seller contained in this Contract; 

                    
(g) Pay or cause to be paid all taxes, assessments and other impositions levied
or assessed on the Hotel or any part thereof prior to the delinquency date, and
comply with all federal, state, and municipal laws, ordinances, regulations and
orders relating to the Hotel; 

                    
(h) Not sell or assign, or enter into any agreement to sell or assign, or
create or permit to exist any lien or encumbrance (other than a Permitted
Exception) on, the Property or any portion thereof; and 

                    
(i) Not allow any permit, receipt, license, franchise or right currently in
existence with respect to the operation, use, occupancy or maintenance of the
Hotel to expire, be canceled or otherwise terminated. 

          Neither
Seller nor Existing Manager shall, without first obtaining the written approval
of Buyer, which approval shall not be unreasonably withheld, enter into any new
FF&E Leases, Service Contracts, Leases or other contracts or agreements
related to the Hotel, or extend any existing such agreements, unless such
agreements (x) can be terminated, without payment or penalty, upon thirty (30)
days’ prior notice or (y) will expire prior to the Closing Date. 

          8.3
Third Party Consents. Prior to the Closing Date, Seller shall, at its
expense, (i) obtain any and all third party consents and approvals (x) required
in order to transfer the Hotel to Buyer, or (y) which, if not obtained, would
materially adversely affect the operation of the Hotel, 

17

including,
without limitation, all consents and approvals referred to on Exhibit D
and (ii) use best efforts to obtain all other third party consents and
approvals (all of such consents and approvals in (i) and (ii) above being
referred to collectively as, the “Third
Party Consents”). 

          8.4
Employees. Upon reasonable prior notice to Seller by Buyer, Buyer and
its employees, representatives and agents shall have the right to communicate
with Seller’s staff, and, subject to the approval of the Existing Manager, the
Hotel staff and the Existing Manager’s staff, including without limitation the
general manager, the director of sales, the engineering staff and other key
management employees of the Hotel, at any time before Closing. Buyer shall not
interfere with the operations of the Hotel while engaging in such communication
in a manner that materially adversely affects the operation of any Property or
the Existing Management Agreements. 

          8.5
Estoppel Certificates. Seller shall obtain from (i) each tenant under
any Lease affecting the Hotel (but not from current or prospective occupants of
hotel rooms and suites within the Hotel) and (ii) each lessor under any
FF&E Lease for the Hotel identified by Buyer as a material FF&E Lease,
the estoppel certificates substantially in the forms provided by Buyer to
Seller, and deliver to Buyer not less than five (5) days before the Closing. 

          8.6
Access to Financial Information. Buyer’s representatives shall have
access to, and Seller and its Affiliates shall cooperate with Buyer and furnish
upon request, all financial and other information relating to the Hotel’s
operations to the extent necessary to enable Buyer’s representatives to prepare
audited financial statements in conformity with Regulation S-X of the
Securities and Exchange Commission (the “SEC”)
and other applicable rules and regulations of the SEC and to enable them to
prepare a registration statement, report or disclosure statement for filing
with the SEC on behalf of Buyer or its Affiliates, whether before or after
Closing and regardless of whether such information is included in the Records
to be transferred to Buyer hereunder. Seller shall also provide to Buyer’s representative
a signed representation letter in form and substance reasonably acceptable to
Seller sufficient to enable an independent public accountant to render an
opinion on the financial statements related to the Hotel. Buyer will reimburse
Seller for costs reasonably incurred by Seller to comply with the requirements
of the preceding sentence to the extent that Seller is required to incur costs
not in the ordinary course of business for third parties to provide such
representation letters. The provisions of this Section shall survive Closing or
termination of this Contract. 

          8.7
Bulk Sales. At Seller’s risk and expense, Seller shall take all steps
necessary to comply with the requirements of a transferor under all bulk
transfer laws, if any, that are applicable to the transactions contemplated by
this Contract. 

          8.8
Indemnification. If the transactions contemplated by this Contract are
consummated as provided herein: 

                    (a)
Indemnification of Buyer. Without in any way limiting or diminishing the
warranties, representations or agreements herein contained or the rights or
remedies available to Buyer for a breach hereof, Seller hereby agrees to
indemnify, defend and hold harmless Buyer and its respective designees,
successors and assigns from and against all losses, judgments, liabilities,
claims, damages or expenses (including reasonable attorneys’ fees) of every
kind, 

18

nature and
description in existence before, on or after Closing, whether known or unknown,
absolute or continent, joint or several, arising out of or relating to: 

	
  

 	
  

 
	
  

 	
                     (i)
 any claim made or asserted against Buyer or any of the Property by a creditor
 of Seller, including any claims based on or alleging a violation of any bulk
 sales act or other similar laws; 

 
	
  

 	
  

 
	
  

 	
                     (ii)
 the breach of any representation, warranty, covenant or agreement of Seller
 contained in this Contract; 

 
	
  

 	
  

 
	
  

 	
                     (iii)
 any liability or obligation of Seller not expressly assumed by Buyer pursuant
 to this Contract; 

 
	
  

 	
  

 
	
  

 	
                     (iv)
 any claim made or asserted by an employee of Seller arising out of Seller’s
 decision to sell the Property; and 

 
	
  

 	
  

 
	
  

 	
                     (v)
 the conduct and operation by or on behalf of Seller of its Hotel or the
 ownership, use or operation of its Property prior to Closing. 

 

                    (b)
Indemnification of Seller. Without in any way limiting or diminishing
the warranties, representations or agreements herein contained or the rights or
remedies available to Seller for a breach hereof, Buyer hereby agrees, with
respect to this Contract, to indemnify, defend and hold harmless Seller from
and against all losses, judgments, liabilities, claims, damages or expenses
(including reasonable attorneys’ fees) of every kind, nature and description in
existence before, on or after Closing, whether known or unknown, absolute or
contingent, joint or several, arising out of or relating to: 

	
  

 	
  

 
	
  

 	
                     (i)
 the breach of any representation, warranty, covenant or agreement of Buyer
 contained in this Contract; 

 
	
  

 	
  

 
	
  

 	
                     (ii)
 the conduct and operation by Buyer of its business at the Hotel after the
 Closing; and 

 
	
  

 	
  

 
	
  

 	
                     (iii)
 any liability or obligation of Buyer expressly assumed by Buyer at Closing. 

 

                    (c)
Indemnification Procedure for Claims of Third Parties. Indemnification,
with respect to claims resulting from the assertion of liability by those not
parties to this Contract (including governmental claims for penalties, fines
and assessments), shall be subject to the following terms and conditions: 

	
  

 	
  

 
	
  

 	
                     (i)
 The party seeking indemnification (the “Indemnified
 Party”) shall give prompt written notice to the party or
 parties from which it is seeking indemnification (the “Indemnifying Party”) of any assertion
 of liability by a third party which might give rise to a claim for
 indemnification based on the foregoing provisions of this Section 8.8, which
 notice shall state the nature and basis of the assertion and the amount
 thereof, to the extent known; provided, however, that no delay on the part of
 the Indemnified Party in giving notice shall relieve the Indemnifying Party
 of any obligation 

 

19

	
  

 	
  

 
	
  

 	
 to indemnify
 unless (and then solely to the extent that) the Indemnifying Party is
 prejudiced by such delay.

 
	
  

 	
  

 
	
  

 	
                     (ii)
 If in any action, suit or proceeding (a “Legal
 Action”) the relief sought is solely the payment of money
 damages, and if the Indemnifying Party specifically agrees in writing to
 indemnify such Indemnified Party with respect thereto and demonstrates to the
 reasonable satisfaction of such Indemnified Party its financial ability to do
 so, the Indemnifying Party shall have the right, commencing thirty (30) days
 after such notice, at its option, to elect to settle, compromise or defend,
 pursuant to this paragraph, by its own counsel and at its own expense, any
 such Legal Action involving such Indemnified Party’s asserted liability. If
 the Indemnifying Party does not undertake to settle, compromise or defend any
 such Legal Action, such settlement, compromise or defense shall be conducted
 in the sole discretion of such Indemnified Party, but such Indemnified Party
 shall provide the Indemnifying Party with such information concerning such
 settlement, compromise or defense as the Indemnifying Party may reasonably
 request from time to time. If the Indemnifying Party undertakes to settle,
 compromise or defend any such asserted liability, it shall notify such Indemnified
 Party in writing of its intention to do so within thirty (30) days of notice
 from such Indemnified Party provided above.

 
	
  

 	
  

 
	
  

 	
                     (iii)
 Notwithstanding the provisions of the previous subsection of this Contract,
 until the Indemnifying Party shall have assumed the defense of the Legal
 Action, the defense shall be handled by the Indemnified Party. Furthermore,
 (x) if the Indemnified Party shall have reasonably concluded that there are
 likely to be defenses available to it that are different from or in addition
 to those available to the Indemnifying Party; (y) if the Legal Action
 involves other than money damages and seeks injunctive or other equitable
 relief; or (z) if a judgment against Buyer, as the Indemnified Party, in the
 Legal Action will, in the good faith opinion of Buyer, establish a custom or
 precedent which will be adverse to the best interest of the continuing
 business of the Hotel, the Indemnifying Party, shall not be entitled to
 assume the defense of the Legal Action and the defense shall be handled by
 the Indemnified Party, provided that, in the case of clause (z), the
 Indemnifying Party shall have the right to approve legal counsel selected by
 the Indemnified Party, such approval not to be unreasonably withheld, delayed
 or conditioned. If the defense of the Legal Action is handled by the
 Indemnified Party under the provisions of this subsection, the Indemnifying
 Party shall pay all legal and other expenses reasonably incurred by the
 Indemnified Party in conducting such defense.

 
	
  

 	
  

 
	
  

 	
                     (iv)
 In any Legal Action initiated by a third party and defended by the
 Indemnifying Party (w) the Indemnified Party shall have the right to be
 represented by advisory counsel and accountants, at its own expense, (x) the
 Indemnifying Party shall keep the Indemnified Party fully informed as to the
 status of such Legal Action at all stages thereof, whether or not the
 Indemnified Party is represented by its own counsel, (y) the Indemnifying
 Party shall make available to the Indemnified Party and its attorneys,
 accounts and other representatives, all books and records of Seller relating
 to such Legal Action and (z) the parties shall render to each other such
 assistance as may be reasonably required in order to ensure the proper and adequate
 defense of such Legal Action.

 

20

	
  

 	
  

 
	
  

 	
                     (v)
 In any Legal Action initiated by a third party and defended by the
 Indemnifying Party, the Indemnifying Party shall not make settlement of any
 claim without the written consent of the Indemnified Party, which consent
 shall not be unreasonably withheld. Without limiting the generality of the
 foregoing, it shall not be deemed unreasonable to withhold consent to a
 settlement involving injunctive or other equitable relief against Buyer or its
 respective assets, employees, Affiliates or business, or relief which Buyer
 reasonably believes could establish a custom or precedent which will be
 adverse to the best interests of its continuing business.

 

          8.9
Escrow Funds. To provide for the timely payment of any post-closing
claims by Buyer against Seller hereunder, at Closing, Seller shall deposit an
amount equal to One Hundred Thousand and No/100 Dollars ($100,000.00) (the “Escrow Funds”) which shall be withheld
from the Purchase Price payable to Seller and shall be deposited for a period
of one (1) year in an escrow account with the Title Company pursuant to an
escrow agreement reasonably satisfactory in form and substance to Buyer and
Seller (the “Post-Closing Agreement”),
which escrow and Post-Closing Agreement shall be established and entered into
at Closing and shall be a condition to Buyer’s obligations under this Contract.
If no claims have been asserted by Buyer against Seller, or all such claims
have been satisfied, within such 1-year period, the Escrow Funds deposited by
Seller shall be released to Seller. 

          8.10
Liquor Licenses. As a condition to Buyer’s obligations under this
Contract, (i) the Manager or an Affiliate thereof approved by Buyer shall have
or shall have obtained all liquor licenses and alcoholic beverage licenses
necessary or desirable to operate any restaurants, bars and lounges presently
located within the Hotel (collectively, the “Liquor Licenses”) and, in the case of an Affiliate of the
Manager, the Hotel has the right to use such Liquor License, (ii) if permitted
under the laws of the jurisdiction in which the Hotel is located, the Manager
shall execute and file any and all necessary forms, applications and other
documents (and Seller shall cooperate with the Manager in filing such forms,
applications and other documents) with the appropriate liquor and alcoholic
beverage authorities prior to Closing so that the Liquor Licenses remain in
full force and effect upon completion of Closing. 

ARTICLE IX

CONDITIONS FOR CLOSING

          9.1 Buyer’s
Conditions for Closing. Unless otherwise waived in writing, and without
prejudice to Buyer’s right to cancel this Contract during the Review Period,
the duties and obligations of Buyer to proceed to Closing under the terms and
provisions of this Contract are and shall be expressly subject to strict
compliance with, and satisfaction or waiver of, each of the conditions and
contingencies set forth in this Section 9.1, each of which shall be deemed
material to this Contract. In the event of the failure of any of the conditions
set forth in this Section 9.1 or of any other condition to Buyer’s obligations
provided for in this Contract, which condition is not waived in writing by
Buyer, Buyer shall have the right at its option to declare this Contract
terminated, in which case the Earnest Money Deposit and any interest thereon
shall be immediately returned to Buyer and each of the parties shall be
relieved from further liability to the other, except as otherwise expressly provided
herein, with respect to this Contract. 

21

                    (a)
All of Seller’s representations and warranties contained in or made pursuant to
this Contract shall be true and correct in all material respects as if made
again on the Closing Date. 

                    (b)
Buyer shall have received all of the instruments and conveyances listed in
Section 10.2. 

                    (c)
Seller shall have performed, observed and complied in all material respects
with all of the covenants, agreements, closing requirements and conditions
required by this Contract to be performed, observed and complied with by
Seller, as and when required hereunder. 

                    (d)
All Liquor Licenses shall be in full force and effect and shall remain in full
force and effect following Closing and shall have been or shall be transferred
to, or new Liquor Licenses issued to, the Manager or an Affiliate thereof
approved by Buyer at or as of Closing, and Buyer shall have received
satisfactory evidence thereof. 

                    (e)
Third Party Consents in form and substance satisfactory to Buyer shall have
been obtained and furnished to Buyer. 

                    (f)
The Escrow Funds shall have been deposited in the escrow account pursuant to
the Post-Closing Agreement and the parties thereto shall have entered into the
Post-Closing Agreement. 

                    (g)
The Existing Management Agreement and the Existing Franchise Agreement shall
have been terminated. 

                    (h)
Buyer and the Manager shall have executed and delivered the New Management
Agreement and Buyer and the Franchisor shall have executed and delivered the
New Franchise Agreement, in each case upon terms and conditions acceptable to
Buyer in its sole and absolute discretion. 

          9.2
Seller’s Conditions for Closing. Unless otherwise waived in writing, and
without prejudice to Seller’s right to cancel this Contract during the Review
Period, the duties and obligations of Seller to proceed to Closing under the
terms and provisions of this Contract are and shall be expressly subject to
strict compliance with, and satisfaction or waiver of, each of the conditions
and contingencies set forth in this Section 9.2, each of which shall be deemed
material to this Contract. In the event of the failure of any of the conditions
set forth in this Section 9.2, which condition is not waived in writing by
Seller, Seller shall have the right at its option to declare this Contract
terminated and null and void, in which case the remaining Earnest Money Deposit
and any interest thereon shall be immediately returned to Buyer and each of the
parties shall be relieved from further liability to the other, except as
otherwise expressly provided herein. 

                    (a)
All of Buyer’s representations and warranties contained in or made pursuant to
this Contract shall be true and correct in all material respects as if made
again on the Closing Date. 

22

                    (b)
Seller shall have received all of the money, instruments and conveyances listed
in Section 10.3. 

                    (c)
Buyer shall have performed, observed and complied in all material respects with
all of the covenants, agreements, closing requirements and conditions required
by this Contract to be performed, observed and complied with by Buyer, as and
when required hereunder. 

ARTICLE X

CLOSING AND CONVEYANCE

          10.1
Closing. Unless otherwise agreed by Buyer and Seller, the Closing on the
Property shall occur on a date selected by Buyer that is the later of (a)
fifteen (15) business days after expiration of the Review Period or (b) the
date Buyer receives the New Franchise Agreement executed by the Franchisor,
provided in either case that all conditions to Closing by Buyer hereunder have
been satisfied. The date on which the Closing is to occur as provided in this
Section 10.1, or such other date as may be agreed upon by Buyer and Seller, is
referred to in this Contract as the “Closing
Date” for the Property. The Closing shall be held via escrow at
the offices of the Title Company, or as otherwise determined by Buyer and
Seller. 

          10.2
Deliveries of Seller. At Closing, Seller shall deliver to Buyer the
following, and, as appropriate, all instruments shall be properly executed and
conveyance instruments to be acknowledged in recordable form (the terms,
provisions and conditions of all instruments not attached hereto as Exhibits
shall be mutually agreed upon by Buyer and Seller prior to such Closing): 

                    (a)
Deed. A Special Warranty deed conveying to Buyer fee simple title to the
Real Property, subject only to the Permitted Exceptions (the “Deed”). 

                    (b)
Bills of Sale. Bills of sale to Buyer and/or its designated Lessee,
conveying title to the tangible Personal Property (other than the alcoholic
beverage inventories, which, at Buyer’s election, shall be transferred by
Seller to the Manager as holder of the Liquor Licenses required for operation
of the Hotel). 

                    (c)
Existing Management and Franchise Agreements. The termination of the
Existing Management Agreement and the Existing Franchise Agreement. 

                    (d)
General Assignments. Assignments of all of Seller’s right, title and
interest in and to all FF&E Leases, Service Contracts and Leases identified
on Exhibit C hereto (the “Hotel Contracts”).
The assignment shall also be a general assignment and shall provide for the
assignment of all of Seller’s right, title and interest in all Records,
Warranties, Licenses, Tradenames, Contracts, Plans and Specs and all other
intangible Personal Property applicable to the Hotel. The assignments shall
contain cross-indemnities by Buyer and Seller for their respective periods of
ownership.  

                    (e)
FIRPTA; 1099. A FIRPTA Affidavit or Transferor’s Certificate of
Non-Foreign Status as required by Section 1445 of the Internal Revenue Code and
an IRS Form 1099. 

23

                    (f)
Title Company Documents. All affidavits, gap indemnity agreements and
other documents reasonably required by the Title Company. At Buyer’s sole
expense, Buyer shall have obtained an irrevocable commitment directly from the
Title Company (or in the event the Title Company is not willing to issue said
irrevocable commitment, then from such other national title company as may be
selected by either Buyer or Seller) for issuance of an Owner’s Policy of Title
Insurance to Buyer insuring good and marketable fee simple absolute title to
the Real Property constituting part of the Property, subject only to the
Permitted Exceptions in the amount of the Purchase Price. 

                    (g)
Possession; Estoppel Certificates. Possession of the Property, subject
only to rights of guests in possession and tenants pursuant to written leases
included in the Leases, and estoppel certificates from tenants under Leases and
the lessors under FF&E Leases in form and substance acceptable to Buyer. 

                    (h)
Vehicle Titles. The necessary certificates of titles duly endorsed for
transfer together with any required affidavits and other documentation
necessary for the transfer of title or assignment of leases from Seller to
Buyer of any motor vehicles used in connection with the Hotel’s operations. 

                    (i)
Authority Documents. Certified copy of resolutions of the Board of
Directors of Seller authorizing the sale of the Property contemplated by this
Contract, and/or other evidence reasonably satisfactory to Buyer and the Title
Company that the person or persons executing the closing documents on behalf of
Seller have full right, power and authority to do so, along with a certificate
of good standing of Seller from the State in which the Property is located. 

                    (j)
Miscellaneous. Such other instruments as are contemplated by this
Contract to be executed or delivered by Seller, reasonably required by Buyer or
the Title Company, or customarily executed in the jurisdiction in which the
Hotel is located, to effectuate the conveyance of property similar to the
Hotel, with the effect that, after the Closing, Buyer will have succeeded to
all of the rights, titles, and interests of Seller related to the Hotel and
Seller will no longer have any rights, titles, or interests in and to the
Hotel. 

                    (k)
Plans, Keys, Records, Etc. To the extent not previously delivered to and
in the possession of Buyer, all Contracts, Plans and Specs, all keys for the
Hotel (which keys shall be properly tagged for identification), all Records,
including, without limitation, all Warranties, Licenses, Leases, FF&E Leases
and Service Contracts for the Hotel. 

                    (l)
Closing Statements. Seller’s Closing Statement, and a certificate
confirming the truth of Seller’s representations and warranties hereunder as of
the Closing Date. 

          10.3
Buyer’s Deliveries. At Closing of the Hotel, Buyer shall deliver the
following: 

                    (a)
Purchase Price. The balance of the Purchase Price, adjusted for the
adjustments provided for in Section 12.1, below, and less any sums to be
deducted therefrom as provided in Section 2.4. 

                    (b)
Authority Documents. Certified copy of resolutions of the Board of
Directors of Buyer authorizing the purchase of the Hotel contemplated by this
Contract, and/or 

24

other evidence
satisfactory to Seller and the Title Company that the person or persons
executing the closing documents on behalf of Buyer have full right, power and
authority to do so. 

                    (c)
Miscellaneous. Such other instruments as are contemplated by this
Contract to be executed or delivered by Buyer, reasonably required by Seller or
the Title Company, or customarily executed in the jurisdiction in which the
Hotel is located, to effectuate the conveyance of property similar to the
Hotel, with the effect that, after the Closing, Buyer will have succeeded to
all of the rights, titles, and interests of Seller related to the Hotel and
Seller will no longer have any rights, titles, or interests in and to the
Hotel. 

                    (d)
Closing Statements. Buyer’s Closing Statement, and a certificate
confirming the truth of Buyer’s representations and warranties hereunder as of
the Closing Date. 

ARTICLE XI

COSTS

          All
Closing costs shall be paid as set forth below: 

          11.1
Seller’s Costs. In connection with the sale of the Property contemplated
under this Contract, Seller shall be responsible for all transfer and
recordation taxes, including, without limitation, all transfer, mansion,
excise, sales, use or bulk transfer taxes or like taxes on or in connection with
the transfer of the Real Property and the Personal Property constituting part
of the Property pursuant to the Bill of Sale, and all accrued taxes of Seller
prior to Closing and income, sales and use taxes and other such taxes of Seller
attributable to the sale of the Property to Buyer. Seller shall be responsible
for all costs related to the termination of the Existing Management Agreement
as provided in Article V. Seller shall also be responsible for any costs and
expenses of its attorneys, accountants, appraisers and other professionals,
consultants and representatives. Seller shall also be responsible for payment
of all prepayment penalties and other amounts payable in connection with the
pay-off of any liens and/or indebtedness encumbering all or any portion of the
Property. 

          11.2
Buyer’s Costs. In connection with the purchase of the Property
contemplated under this Contract, Buyer shall be responsible for the costs and
expenses of its attorneys, accountants and other professionals, consultants and
representatives. Buyer shall also be responsible for the costs and expenses in
connection with the preparation of any environmental report, any update to the
survey and the costs and expenses of preparation of the title insurance
commitment and the issuance of the title insurance policy contemplated by
Article IV and the per page recording charges and clerk’s fee for the Deed (if
applicable). Buyer shall also be responsible for the fees for the performance
of the property improvement plan (PIP) review and report by the Franchisor and,
if Closing occurs, Buyer shall be responsible for the PIP implementation. 

ARTICLE XII

ADJUSTMENTS

          12.1
Adjustments. Unless otherwise provided herein, at Closing, adjustments
between the parties shall be made as of 11:59 p.m. on the eve of the Closing
Date (the “Cutoff Time”), 

25

with the
income and expenses accrued prior to the Cutoff Time being allocated to Seller
and the income and expenses accruing on and after the Cutoff Time being
allocated to Buyer, all as set forth below. All of such adjustments and
allocations shall be made in cash at Closing and shall be collected through
and/or adjusted in accordance with the terms of the Existing Management
Agreement. Except as otherwise expressly provided herein, all apportionments
and adjustments shall be made on an accrual basis in accordance with generally
accepted accounting principles. Buyer and Seller shall request that the Manager determine the apportionments, allocations,
prorations and adjustments as of the Cutoff Time. 

                    (a)
Taxes. All real estate taxes, personal property taxes, or any other
taxes and special assessments (special or otherwise) of any nature upon the
Property levied, assessed or pending for the calendar year in which the Closing
occurs (including the period prior to Closing, regardless of when due and
payable) shall be prorated as of the Cutoff Time and, if no tax bills or
assessment statements for such calendar year are available, such amounts shall
be estimated on the basis of the best available information for such taxes and
assessments that will be due and payable on the Hotel for the calendar year in
which Closing occurs. Until final tax bills that cover the entire year during
which Closing occurred (such that tax liability can reasonably be determined),
Seller’s obligation to pay its share of taxes shall continue. 

                    (b)
Utilities. All suppliers of utilities shall be instructed to read meters
or otherwise determine the charges owing as of the Closing Date for services
prior thereto, which charges shall be allocated to Seller. Charges accruing
after Closing shall be allocated to Buyer. If elected by Seller, Seller shall
be given credit, and Buyer shall be charged, for any utility deposits
transferred to and received by Buyer at Closing. 

                    (c)
Income/Charges. All rents, income and charges receivable or payable
under any Leases and Hotel Contracts applicable to the Property, and any
deposits, prepayments and receipts thereunder, shall be prorated between Buyer
and Seller as of the Cutoff Time. 

                    (d)
Accounts. All working capital accounts, reserve accounts and escrow
accounts (including all FF&E accounts, all PIP accounts, Franchisor
escrows, but excluding amounts held in tax and insurance escrow accounts and
utility deposits to the extent excluded from the definition of Deposits, shall
become the property of Buyer, without additional charge to Buyer and without
Buyer being required to fund the same. 

                    (e)
Guest Ledger. Subject to (f) below, all accounts receivable of
registered guests at the Hotel who have not checked out and were occupying
rooms as of the Cutoff Time, shall be prorated as provided herein. 

                    (f)
Room Rentals. All receipts from guest room rentals and other suite
revenues for the night in which the Cutoff Time occurs shall be split 50/50
between Buyer and Seller. 

                    (g)
Advance Deposits. All prepaid rentals, room rental deposits, and all
other deposits for advance registration, banquets or future services to be
provided on and after the Closing Date shall be credited to Buyer. 

26

                    (h)
Accounts Receivable. To the extent not apportioned at Closing and
subject to (e) and (f) above, all accounts receivable and credit card claims as
of the Cutoff Time shall remain the property of Seller, and Seller and Buyer
agree that the monies received from debtors owing such accounts receivable
balances after Closing, unless otherwise provided in the New Management
Agreement, shall be applied as expressly provided in such remittance, or if not
specified then to the Seller’s outstanding invoices to such account debtors in
chronological order beginning with the oldest invoices, and thereafter, to
Buyer’s account. 

                    (i)
Accounts Payable. To the extent not apportioned at Closing, any
indebtedness, accounts payable, liabilities or obligations of any kind or
nature related to Seller or the Property for the periods prior to and including
the Closing Date shall be retained by Seller and promptly allocated to Seller
and evidence thereof shall be provided to Buyer, and Buyer shall not be or
become liable therefor, except as expressly assumed by Buyer pursuant to this
Contract, and invoices received in the ordinary course of business prior to
Closing shall be allocated to Seller at Closing. 

                    (j)
Restaurants, Bars, Machines, Other Income. All monies received in
connection with bar, restaurant, banquet and similar and other services at the
Hotel (other than amounts due from any guest and included in room rentals)
prior to the close of business for each such operation for the night in which
the Cutoff Time occurs shall belong to Seller, and all other receipts and
revenues (not previously described in this Section 12.1) from the operation of
any department of the Hotel shall be prorated between Seller and Buyer at
Closing. 

          12.2
Reconciliation and Final Payment. Seller and Buyer shall reasonably
cooperate after Closing to make a final determination of the allocations and
prorations required under this Contract within one hundred eighty (180) days
after the Closing Date; provided, however, failure to make a final
determination within such period shall not relieve the parties of the
obligation to make a final determination nor shall it relieve any party of the
obligation to pay the other any true-up amounts owed. Upon the final
reconciliation of the allocations and prorations under this Section, the party
which owes the other party any sums hereunder shall pay such party such sums
within ten (10) days after the reconciliation of such sums. The obligations to
calculate such prorations, make such reconciliations and pay any such sums
shall survive the Closing. 

          12.3
Employees. None of the employees of the Hotel shall become employees of
Buyer, as of the Closing Date; instead, such employees shall become employees
of the Manager. Seller shall not give notice under any applicable federal or
state plant closing or similar act, including, if applicable, the Worker
Adjustment and Retraining Notification Provisions of 29 U.S.C., Section 2102,
the parties having agreed that a mass layoff, as that term is defined in 29
U.S.C., 2101(a)(3), will not have occurred. Any liability for payment of all
wages, salaries and benefits, including, without limitation, accrued vacation
pay, sick leave, bonuses, pension benefits, COBRA rights, and other benefits
accrued or earned by and due to employees at the Hotel through the Cutoff Time,
together with F.I.C.A., unemployment and other taxes and benefits due with
respect to such employees for such period, shall be charged to Seller, in
accordance with the Existing Management Agreement, for the purposes of the
adjustments to be made as of the Cutoff Time. All liability for wages, salaries
and benefits of the employees accruing in respect of and attributable to the
period from and after Closing shall be charged to Buyer, in accordance with the
New Management Agreement. To the extent applicable, all such 

27

allocations
and charges shall be adjusted in accordance with the provisions of the Existing
Management Agreement. 

ARTICLE XIII 

CASUALTY AND CONDEMNATION

          13.1
Risk of Loss; Notice. Prior to Closing and the delivery of possession of
the Property to Buyer in accordance with this Contract, all risk of loss to the
Property (whether by casualty, condemnation or otherwise) shall be borne by
Seller. In the event that (a) any loss or damage to the Hotel shall occur prior
to the Closing Date as a result of fire or other casualty, or (b) Seller
receives notice that a governmental authority has initiated or threatened to
initiate a condemnation proceeding affecting the Hotel, Seller shall give Buyer
immediate written notice of such loss, damage or condemnation proceeding (which
notice shall include a certification of (i) the amounts of insurance coverages
in effect with respect to the loss or damage and (ii) if known, the amount of
the award to be received in such condemnation). 

          13.2
Buyer’s Termination Right. If, prior to Closing and the delivery of
possession of the Property to Buyer in accordance with this Contract, (a) any
condemnation proceeding shall be pending against a substantial portion of the
Hotel or (b) there is any substantial casualty loss or damage to the Hotel,
Buyer shall have the option to terminate this Contract, provided Buyer delivers
written notice to Seller of its election within twenty (20) days after the date
Seller has delivered Buyer written notice of any such loss, damage or
condemnation as provided above, and in such event, the Earnest Money Deposit,
and any interest thereon, shall be delivered to Buyer and thereafter, except as
expressly set forth herein, no party shall have any further obligation or
liability to the other under this Contract. In the context of condemnation,
“substantial” shall mean condemnation of such portion of a Hotel (or access
thereto) as could, in Buyer’s reasonable judgment, render use of the remainder
impractical or unfeasible for the uses herein contemplated, and, in the context
of casualty loss or damage, “substantial” shall mean a loss or damage in excess
of One Hundred Thousand and No/100 Dollars ($100,000.00) in value. 

          13.3
Procedure for Closing. If Buyer shall not timely elect to terminate this
Contract under Section 13.2 above, or if the loss, damage or condemnation is
not substantial, Seller agrees to pay to Buyer at the Closing all insurance
proceeds or condemnation awards which Seller has received as a result of the
same, plus an amount equal to the insurance deductible, and assign to Buyer all
insurance proceeds and condemnation awards payable as a result of the same, in
which event the Closing shall occur without Seller replacing or repairing such
damage. In the case of damage or casualty, at Buyer’s election, Seller shall
repair and restore the Property to its condition immediately prior to such
damage or casualty and shall assign to Buyer all excess insurance proceeds. 

ARTICLE XIV

DEFAULT REMEDIES

          14.1
Buyer Default. If Buyer defaults under this Contract after the Review
Period, and such default continues for thirty (30) days following written
notice from Seller, then at Seller’s election by written notice to Buyer, this
Contract shall be terminated and of no effect, in which event the Earnest Money
Deposit, including any interest thereon, shall be paid to and retained by 

28

the Seller as
Seller’s sole and exclusive remedy hereunder, and as liquidated damages for
Buyer’s default or failure to close, and both Buyer and Seller shall thereupon
be released from all obligations hereunder. 

          14.2
Seller Default. If Seller defaults under this Contract, and such default
continues for thirty (30) days following written notice from Buyer, Buyer may
elect, as Buyer’s sole and exclusive remedy, either (i) to terminate this
Contract by written notice to Seller delivered to that Seller at any time prior
to the completion of such cure, in which event the Earnest Money Deposit,
including any interest thereon, shall be returned to the Buyer, Seller shall
reimburse Buyer for Buyer’s actual and verifiable due diligence costs and
expenses (not to exceed $75,000) and thereafter both the Buyer and Seller shall
thereupon be released from all obligations with respect to this Contract,
except as otherwise expressly provided herein; or (ii) to treat this Contract
as being in full force and effect by written notice to Seller delivered to
Seller at any time prior to the completion of such cure, in which event the
Buyer shall have the right to an action against the defaulting Seller for
damages, specific performance and all other rights and remedies available at
law or in equity. 

          14.3
Attorney’s Fees. Anything to the contrary herein notwithstanding, if it
shall be necessary for either the Buyer or Seller to employ an attorney to
enforce its rights pursuant to this Contract because of the default of the
other party, and the non-defaulting party is successful in enforcing such
rights, then the defaulting party shall reimburse the non-defaulting party for
the non-defaulting party’s reasonable attorneys’ fees, costs and expenses. 

ARTICLE XV

NOTICES

          All
notices required herein shall be deemed to have been validly given, as
applicable: (i) if given by fax, when the fax is transmitted to the party’s fax
number specified below and confirmation of complete receipt is received by the
transmitting party during normal business hours or on the next Business Day if
not confirmed during normal business hours, (ii) if hand delivered to a party
against receipted copy, when the copy of the notice is receipted or rejected,
(iii) if given by certified mail, return receipt requested, postage prepaid,
two (2) Business Days after it is posted with the U.S. Postal Service at the
address of the party specified below or (iv) on the next delivery day after
such notices are sent by recognized and reputable commercial overnight delivery
service marked for next day delivery, return receipt requested or similarly
acknowledged: 

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 If to Buyer:

 	
  

 	
 Apple Nine
 Hospitality Ownership, Inc. 

 
	
  

 	
  

 	
  

 	
 814 E. Main
 Street

 
	
  

 	
  

 	
  

 	
 Richmond,
 Virginia 23219

 
	
  

 	
  

 	
  

 	
 Attention:
 Sam Reynolds

 
	
  

 	
  

 	
  

 	
 Fax No.:
 (804) 344-8129

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 with a copy
 to:

 	
  

 	
 Apple Nine
 Hospitality Ownership, Inc. 

 
	
  

 	
  

 	
  

 	
 814 E. Main
 Street

 
	
  

 	
  

 	
  

 	
 Richmond,
 Virginia 23219

 
	
  

 	
  

 	
  

 	
 Attention:
 Legal Dept.

 

29

	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 Fax No.:
 (804) 727-6349

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 If to
 Seller:

 	
  

 	
 Lodging
 America of West Monroe, LLC

 
	
  

 	
  

 	
  

 	
 1554 West
 Peace Street

 
	
  

 	
  

 	
  

 	
 Canton,
 Mississippi 39046

 
	
  

 	
  

 	
  

 	
 Attention:
 S. L. Sethi

 
	
  

 	
  

 	
  

 	
 Fax No.:
 (601) 855-9305

 

          Addresses
may be changed by the parties hereto by written notice in accordance with this
Section. 

ARTICLE XVI

MISCELLANEOUS

          16.1
Performance. Time is of the essence in the performance and satisfaction
of each and every obligation and condition of this Contract. 

          16.2
Binding Effect; Assignment. This Contract shall be binding upon and
shall inure to the benefit of each of the parties hereto, their respective
successors and assigns. 

          16.3
Entire Agreement. This Contract and the Exhibits constitute the sole and
entire agreement between Buyer and Seller with respect to the subject matter
hereof. No modification of this Contract shall be binding unless signed by both
Buyer and Seller. 

          16.4
Governing Law. The validity, construction, interpretation and
performance of this Contract shall in all ways be governed and determined in
accordance with the laws of the State of Louisiana (without regard to conflicts
of law principles). 

          16.5
Captions. The captions used in this Contract have been inserted only for
purposes of convenience and the same shall not be construed or interpreted so
as to limit or define the intent or the scope of any part of this Contract. 

          16.6
Confidentiality. Except as either party may reasonably determine is
required by law (including without limitation laws and regulations applicable
to Buyer or its Affiliates who may be public companies): (i) prior to Closing,
Buyer and Seller shall not disclose the existence of this Contract or their
respective intentions to purchase and sell the Property or generate or
participate in any publicity or press release regarding this transaction,
except to Buyer’s and Seller’s legal counsel and lender, Buyer’s consultants
and agents, the Manager, the Existing Manager, the Franchisor and the Title
Company and except as necessitated by Buyer’s Due Diligence Examination and/or
shadow management, unless both Buyer and Seller agree in writing and as
necessary to effectuate the transactions contemplated hereby and (ii) following
Closing, the parties shall coordinate any public disclosure or release of
information related to the transactions contemplated by this Contract, and no
such disclosure or release shall be made without the prior written consent of
Buyer, and no press release shall be made without the prior written approval of
Buyer and Seller. 

30

          16.7
Closing Documents. To the extent any Closing documents are not attached
hereto at the time of execution of this Contract, Buyer and Seller shall
negotiate in good faith with respect to the form and content of such Closing
documents prior to Closing. 

          16.8
Counterparts. This Contract may be executed in counterparts by the
parties hereto, and by facsimile signature, and each shall be considered an original
and all of which shall constitute one and the same agreement. 

          16.9
Severability. If any provision of this Contract shall, for any reason,
be adjudged by any court of competent jurisdiction to be invalid or
unenforceable, such judgment shall not affect, impair or invalidate the
remainder of this Contract but shall be confined in its operation to the
provision or provisions hereof directly involved in the controversy in which
such judgment shall have been rendered, and this Contract shall be construed as
if such provision had never existed, unless such construction would operate as
an undue hardship on Seller or Buyer or would constitute a substantial
deviation from the general intent of the parties as reflected in this Contract.

          16.10
Interpretation. For purposes of construing the provisions of this
Contract, the singular shall be deemed to include the plural and vice versa
and the use of any gender shall include the use of any other gender, as the
context may require. 

          16.11
Further Acts. In addition to the acts, deeds, instruments and agreements
recited herein and contemplated to be performed, executed and delivered by
Buyer and Seller, Buyer and Seller shall perform, execute and deliver or cause
to be performed, executed and delivered at the Closing or after the Closing,
any and all further acts, deeds, instruments and agreements and provide such
further assurances as the other party or the Title Company may reasonably
require to consummate the transaction contemplated hereunder. 

          16.12
Joint and Several Obligations. If Seller consists of more than one
person or entity, each such person or entity shall be jointly and severally
liable with respect to the obligations of Seller under this Contract. 

          16.13
Notice of Proposed Listing. In the event that the sale of the Property
contemplated by this Contract is consummated, if at any time during the five
(5) year period commencing on the date of execution of this Contract by Buyer
and Seller, Seller or any of its Affiliates propose to list for sale any hotel
property or properties owned, acquired, constructed or developed by Seller or
their Affiliates and located within a ten (10)-mile radius of the Hotel (any
such other hotel property being referred to as an “Other Property”), Seller shall promptly
deliver to Buyer written notice thereof and Buyer shall have the right to see
and participate in the offering and/or otherwise make an offer to purchase any
such Other Property. 

ARTICLE XVII

LAFAYETTE CONTRACT

          Concurrently
with the execution of this Contract, Buyer is entering into a purchase contract
(the “Lafayette Contract”) with Jackie’s International, Inc., a Mississippi
corporation (the “Lafayette Seller”) for the purchase of the Hilton Garden Inn
Lafayette/Cajundome hotel located at 2350 West Congress Street, Lafayette,
Louisiana 70506. Buyer and Seller 

31

acknowledge
and agree that the closings under this Contract and the Lafayette Contract must
occur simultaneously, that a default by either party under this Contract that
remains uncured in accordance with the terms of this Contract shall entitle the
non-defaulting party to terminate the Lafayette Contract on notice to the
other, and that a default by either party under the Lafayette Contract shall
entitle the non-defaulting party to terminate this Contract on notice to the
other. In addition, in the event of any occurrence or exercise of any right
which results in the termination of the Lafayette Contract prior to Closing,
either party shall have the right to terminate this Contract upon notice to the
other, in which event, unless such termination resulted from Buyer’s default,
the Deposit shall be paid to Buyer. Notwithstanding the foregoing, in the event
of termination of this Contract and the Lafayette Contract as a result of
Buyer’s default under one, but not both, of such Contracts, the selling party
shall only be entitled to retain the Deposit for the Contract under which Buyer
shall have defaulted. Notwithstanding the foregoing, in the event of a default
by Seller, under one, but not both, of such Contracts, Buyer shall be entitled
to either (i) terminate both this Contract and the Lafayette Contract, or (ii)
pursue its remedies for default of both this Contract and the Lafayette
Contract in accordance with Section14.2 of each Contract. 

[Signatures Begin on Following Page]

32

          IN WITNESS
WHEREOF, this Contract has been executed, to be effective as of the date first
above written, by the Buyer and Seller. 

	
  

 	
  

 	
  

 
	
  

 	
 SELLER:

 
	
  

 	
  

 	
  

 
	
  

 	
 LODGING AMERICA OF WEST MONROE, LLC, a
 Louisiana limited liability company

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
    /s/ S.L. Sethi

 
	
  

 	
  

 	

 

 
	
  

 	
  

 	
  

 
	
  

 	
 Name: S.L.
 Sethi

 
	
  

 	
 Title:   Manager

 
	
  

 	
  

 	
  

 
	
  

 	
 BUYER:

 
	
  

 	
  

 	
  

 
	
  

 	
 APPLE NINE HOSPITALITY OWNERSHIP, INC., a
 Virginia corporation

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
      /s/ Justin G. Knight

 
	
  

 	
  

 	

 

 
	
  

 	
 Name: Justin
 G. Knight

 
	
  

 	
 Title:
 President

 

33

EXHIBIT “A”

LEGAL DESCRIPTION OF LAND

Lot 4A of the Resubdivision of Lot 4, West
Monroe Commercial Park Subdivision in Sections 29, 32 &33, Township 18
North, Range 3 East, Ouachita Parish, Louisiana, as reflected in that plat of
record in Plat Book 23, page 160, records of Ouachita Parish, Louisiana. 

-1-Exhibit 10.81 

Lafayette, LA (HGI) 

PURCHASE CONTRACT

between

JACKIE’S INTERNATIONAL, INC. (“SELLER”)

 (“SELLER”)

AND

APPLE NINE HOSPITALITY OWNERSHIP, INC.
(“BUYER”)

AND

Dated: May 28, 2010

TABLE OF CONTENTS

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
 Page No.

 
	
  

 	
  

 	
  

 	
  

 	
  

 	

 

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE I

 	
  

 	
 DEFINED TERMS

 	
  

 	
 1

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 1.1

 	
  

 	
 Definitions

 	
  

 	
 1

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE II

 	
  

 	
 PURCHASE AND
 SALE; PURCHASE PRICE; PAYMENT; EARNEST MONEY DEPOSIT

 	
  

 	
 6

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 2.1

 	
  

 	
 Purchase and
 Sale

 	
  

 	
 6

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 2.2

 	
  

 	
 Purchase
 Price

 	
  

 	
 6

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 2.3

 	
  

 	
 Allocation

 	
  

 	
 7

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 2.4

 	
  

 	
 Payment

 	
  

 	
 7

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 2.5

 	
  

 	
 Earnest
 Money Deposit

 	
  

 	
 7

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE III

 	
  

 	
 REVIEW PERIOD

 	
  

 	
 7

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 3.1

 	
  

 	
 Review
 Period

 	
  

 	
 7

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 3.2

 	
  

 	
 Due
 Diligence Examination

 	
  

 	
 9

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 3.3

 	
  

 	
 Restoration

 	
  

 	
 9

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 3.4

 	
  

 	
 Seller
 Exhibits

 	
  

 	
 9

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE IV

 	
  

 	
 SURVEY AND TITLE APPROVAL

 	
  

 	
 9

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 4.1

 	
  

 	
 Survey

 	
  

 	
 9

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 4.2

 	
  

 	
 Title

 	
  

 	
 9

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 4.3

 	
  

 	
 Survey or
 Title Objections

 	
  

 	
 10

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE V

 	
  

 	
 TERMINATION OF MANAGEMENT AGREEMENT

 	
  

 	
 10

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE VI

 	
  

 	
 BROKERS

 	
  

 	
 11

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE VII

 	
 REPRESENTATIONS, WARRANTIES AND COVENANTS

 	
  

 	
 11

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 7.1

 	
  

 	
 Seller’s
 Representations, Warranties and Covenants

 	
  

 	
 11

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 7.2

 	
  

 	
 Buyer’s
 Representations, Warranties and Covenants

 	
  

 	
 15

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 7.3

 	
  

 	
 Survival

 	
  

 	
 15

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE VIII

 	
 ADDITIONAL COVENANTS

 	
  

 	
 16

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.1

 	
  

 	
 Subsequent
 Developments

 	
  

 	
 16

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.2

 	
  

 	
 Operations

 	
  

 	
 16

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.3

 	
  

 	
 Third Party
 Consents

 	
  

 	
 17

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.4

 	
  

 	
 Employees

 	
  

 	
 17

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.5

 	
  

 	
 Estoppel
 Certificates

 	
  

 	
 18

 

i

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.6

 	
  

 	
 Access to
 Financial Information

 	
  

 	
 18

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.7

 	
  

 	
 Bulk Sales

 	
  

 	
 18

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.8

 	
  

 	
 Indemnification

 	
  

 	
 18

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.9

 	
  

 	
 Escrow Funds

 	
  

 	
 21

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.10

 	
  

 	
 Liquor
 Licenses

 	
  

 	
 21

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 8.10

 	
  

 	
 Ground Lease

 	
  

 	
 21

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE IX

 	
  

 	
 CONDITIONS FOR CLOSING

 	
  

 	
 21

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 9.1

 	
  

 	
 Buyer’s
 Conditions for Closing

 	
  

 	
 21

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 9.2

 	
  

 	
 Seller’s
 Conditions for Closing

 	
  

 	
 22

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE X

 	
  

 	
 CLOSING AND CONVEYANCE

 	
  

 	
 22

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 10.1

 	
  

 	
 Closing

 	
  

 	
 22

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 10.2

 	
  

 	
 Deliveries
 of Seller

 	
  

 	
 23

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 10.3

 	
  

 	
 Buyer’s
 Deliveries

 	
  

 	
 24

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE XI

 	
  

 	
 COSTS

 	
  

 	
 25

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 11.1

 	
  

 	
 Seller’s
 Costs

 	
  

 	
 25

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 11.2

 	
  

 	
 Buyer’s
 Costs

 	
  

 	
 25

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE XII

 	
 ADJUSTMENTS

 	
  

 	
 25

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 12.1

 	
  

 	
 Adjustments

 	
  

 	
 25

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 12.2

 	
  

 	
 Reconciliation
 and Final Payment

 	
  

 	
 27

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 12.3

 	
  

 	
 Employees

 	
  

 	
 27

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE XIII

 	
 CASUALTY AND
 CONDEMNATION

 	
  

 	
 27

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 13.1

 	
  

 	
 Risk of
 Loss; Notice

 	
  

 	
 27

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 13.2

 	
  

 	
 Buyer’s
 Termination Right

 	
  

 	
 28

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 13.3

 	
  

 	
 Procedure
 for Closing

 	
  

 	
 28

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE XIV

 	
 DEFAULT REMEDIES

 	
  

 	
 28

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 14.1

 	
  

 	
 Buyer
 Default

 	
  

 	
 28

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 14.2

 	
  

 	
 Seller
 Default

 	
  

 	
 29

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 14.3

 	
  

 	
 Attorney’s
 Fees

 	
  

 	
 29

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE XV

 	
 NOTICES

 	
  

 	
 29

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE XVI

 	
 MISCELLANEOUS

 	
  

 	
 30

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.1

 	
  

 	
 Performance

 	
  

 	
 30

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.2

 	
  

 	
 Binding
 Effect; Assignment

 	
  

 	
 30

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.3

 	
  

 	
 Entire
 Agreement

 	
  

 	
 30

 

ii

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.4

 	
  

 	
 Governing
 Law

 	
  

 	
 30

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.5

 	
  

 	
 Captions

 	
  

 	
 30

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.6

 	
  

 	
 Confidentiality

 	
  

 	
 30

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.7

 	
  

 	
 Closing
 Documents

 	
  

 	
 30

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.8

 	
  

 	
 Counterparts

 	
  

 	
 30

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.9

 	
  

 	
 Severability

 	
  

 	
 31

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.10

 	
  

 	
 Interpretation

 	
  

 	
 31

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.11

 	
  

 	
 (Intentionally
 Omitted)

 	
  

 	
 31

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.12

 	
  

 	
 Further Acts

 	
  

 	
 31

 
	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 16.13

 	
  

 	
 Joint and
 Several Obligations

 	
  

 	
 31

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 ARTICLE XVII

 	
 WEST MONROE CONTRACT

 	
  

 	
 31

 

	
  

 	
  

 	
  

 	
  

 	
  

 
	
 SCHEDULES:

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Schedule 3.1

 	
  

 	
 Due
 Diligence List

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 EXHIBITS:

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Exhibit A

 	
  

 	
 Legal
 Description

 	
  

 	
  

 
	
 Exhibit B

 	
  

 	
 List of
 FF&E

 	
  

 	
  

 
	
 Exhibit C

 	
  

 	
 List of
 Hotel Contracts

 	
  

 	
  

 
	
 Exhibit D

 	
  

 	
 Consents and
 Approvals

 	
  

 	
  

 
	
 Exhibit E

 	
  

 	
 Environmental
 Reports

 	
  

 	
  

 
	
 Exhibit F

 	
  

 	
 Claims or
 Litigation Pending

 	
  

 	
  

 
	
 Exhibit G

 	
  

 	
 Escrow
 Agreement

 	
  

 	
  

 

iii

PURCHASE CONTRACT 

          This
PURCHASE CONTRACT (this “Contract”)
is made and entered into as of May 28, 2010, by and between JACKIE’S
INTERNATIONAL, INC., a Mississippi corporation (“Seller”) with a principal office at 1554 West Peace
Street, Canton, Mississippi 39046 and APPLE NINE HOSPITALITY OWNERSHIP, INC., a
Virginia corporation, with its principal office at 814 East Main Street,
Richmond, Virginia 23219, or its affiliates or assigns (“Buyer”).

RECITALS

          A.
Seller is the owner of that certain 153-room hotel property commonly known as
the Hilton Garden Inn Lafayette/Cajundome located at 2350 West Congress Street,
Lafayette, Louisiana 70506 (the “Hotel”)
identified in on Exhibit A
attached hereto and incorporated by reference. Seller is the leasehold owner of
the Land.

          B.
Buyer is desirous of purchasing the Hotel from Seller, and Seller is desirous
of selling the Hotel to Buyer, for the purchase price and upon terms and
conditions hereinafter set forth.

AGREEMENT:

          NOW,
THEREFORE, in consideration of the foregoing Recitals, the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree
as follows:

ARTICLE I

DEFINED TERMS

          1.1
Definitions. The following capitalized terms when used in this
Contract shall have the meanings set forth below unless the context otherwise
requires:

          “Additional
Deposit” shall mean $150,000.

          “Affiliate”
shall mean, with respect to Seller or Buyer, any other person or entity
directly or indirectly controlling (including but not limited to all directors
and officers), controlled by or under direct or indirect common control with
Seller or Buyer, as applicable. For purposes of the foregoing, a person or
entity shall be deemed to control another person or entity if it possesses,
directly or indirectly, the power to direct or cause direction of the
management and policies of such other person or entity, whether through the
ownership of voting securities, by contract or otherwise. 

          “Appurtenances”
shall mean all rights, titles, and interests of Seller appurtenant to the Land
and Improvements, including, but not limited to, (i) all easements, rights of
way, rights of ingress and egress, tenements, hereditaments, privileges, and
appurtenances in any way belonging to the Land or Improvements, (ii) any land
lying in the bed of any alley, highway, street, road or avenue, open or
proposed, in front of or abutting or adjoining the Land, (iii) any strips or
gores of real estate adjacent to the Land, and (iv) the use of all alleys,
easements and rights-of-way, if any, abutting, adjacent, contiguous to or
adjoining the Land.

1

          “Brand” shall mean Hilton Garden Inn, the hotel brand or franchise under
which the Hotel operates.

          “Business
Day” shall mean any day other than a Saturday, Sunday or legal holiday in
the Commonwealth of Virginia or the state in which the Property is located.

          “Closing”
shall mean the closing of the purchase and sale of the Property pursuant to
this Contract.

          “Closing
Date” shall have the meaning set forth in Section 10.1.

          “Contracts,
Plans and Specs” shall mean all construction and other contracts, plans,
drawings, specifications, surveys, soil reports, engineering reports,
inspection reports, and other technical descriptions and reports.

          “Deed”
shall have the meaning set forth in Section 10.2(a).

          “Deposits”
shall mean, to the extent assignable, all prepaid rents and deposits
(including, without limitation, any reserves for replacement of FF&E and
for capital repairs and/or improvements), refundable security deposits and
rental deposits, and all other deposits for advance reservations, banquets or
future services, made in connection with the use or occupancy of the
Improvements; provided, however, that to the extent Seller has not received or
does not hold all of the prepaid rents and/or deposits attributable to the
Leases related to the Property, Buyer shall be entitled to a credit against the
cash portion of the Purchase Price allocable to the Property in an amount equal
to the amount of the prepaid rents and/or deposits attributable to the Leases
transferred at the Closing of such Property, and provided further, that
“Deposits” shall exclude (i) reserves for real property taxes and insurance, in
each case, to the extent pro rated on the settlement statement such that Buyer
receives a credit for (a) taxes and premiums in respect of any period prior to
Closing and (b) the amount of deductibles and other self-insurance and all
other potential liabilities and claims in respect of any period prior to
Closing, and (ii) utility deposits.

          “Due
Diligence Examination” shall have the meaning set forth in Section 3.2.

          “Earnest
Money Deposit” shall have the meaning set forth in Section 2.5(a).

          “Environmental
Requirements” shall have the meaning set forth in Section 7.1(f)

          “Escrow
Agent” shall have the meaning set forth in Section 2.5(a).

          “Escrow
Agreement” shall have the meaning set forth in Section 2.5(b).

          “Exception Documents” shall have the meaning set forth in Section 4.2.

          “Existing
Franchise Agreement” shall mean that certain franchise license agreement
between the Seller and the Franchisor, granting to Seller a franchise to
operate the Hotel under the Brand.

2

          “Existing Management Agreement” shall mean that certain management
agreement between the Seller and the Existing Manager for the operation and
management of the Hotel.

          “Existing
Manager” shall mean Certified Hospitality Corporation.

          “FF&E”
shall mean all tangible personal property and fixtures of any kind (other than
personal property (i) owned by guests of the Hotel or (ii) leased by Seller
pursuant to an FF&E Lease) attached to, or located upon and used in
connection with the ownership, maintenance, use or operation of the Land or
Improvements as of the date hereof (or acquired by Seller and so employed prior
to Closing), including, but not limited to, all furniture, fixtures, equipment,
signs and related personal property; all heating, lighting, plumbing, drainage,
electrical, air conditioning, and other mechanical fixtures and equipment and
systems; all elevators, and related motors and electrical equipment and
systems; all hot water heaters, furnaces, heating controls, motors and
equipment, all shelving and partitions, all ventilating equipment, and all
disposal equipment; all spa, health club and fitness equipment; all equipment
used in connection with the use and/or maintenance of the guestrooms,
restaurants, lounges, business centers, meeting rooms, swimming pools, indoor
and/or outdoor sports facilities and other common areas and recreational areas;
all carpet, drapes, beds, furniture, televisions and other furnishings; all
stoves, ovens, freezers, refrigerators, dishwashers, disposals, kitchen
equipment and utensils, tables, chairs, plates and other dishes, glasses,
silverware, serving pieces and other restaurant and bar equipment, apparatus
and utensils. A current list of FF&E is attached hereto as Exhibit B.

          “FF&E
Leases” shall mean all leases of any FF&E and other contracts
permitting the use of any FF&E at the Improvements that are assumed by
Buyer.

          “Financial
Statements” shall have the meaning set forth in Section 3.1(b).

          “Franchisor”
shall mean Hilton Garden Inns Franchise LLC.

          “Ground
Lease” shall have the meaning set forth in Section 8.11

          “Ground
Lease Estoppel” shall have the meaning set forth in Section 8.11.

          “Ground
Lessor” shall have the meaning set forth in Section 8.11.

          “Hotel
Contracts” shall have the meaning set forth in Section 10.2(d).

          “Improvements”
shall mean all buildings, structures, fixtures, parking areas and other
improvements to the Land, and all related facilities.

          “Indemnification
Agreement” shall have the meaning set forth in Article XVII.

          “Indemnified
Party” shall have the meaning set forth in Section 8.8(c)(i).

          “Indemnifying
Party” shall have the meaning set forth in Section 8.8(c)(i).

          “Initial
Deposit” shall have the meaning set forth in Section 2.5(a).

3

          “Land”
shall mean, collectively, a fee simple absolute interest in the real property
more fully described in Exhibit A, which is attached hereto and
incorporated herein by reference, together with all rights (including without
limitation all air rights, mineral rights and development rights), alleys,
streets, strips, gores, waters, privileges, appurtenances, advantages and
easements belonging thereto or in any way appertaining thereto.

          “Leases”
shall mean all leases, franchises, licenses, occupancy agreements, “trade-out”
agreements, advance bookings, convention reservations, or other agreements
demising space in, providing for the use or occupancy of, or otherwise
similarly affecting or relating to the use or occupancy of, the Improvements or
Land, together with all amendments, modifications, renewals and extensions
thereof, and all guaranties by third parties of the obligations of the tenants,
licensees, franchisees, concessionaires or other entities thereunder.

          “Legal
Action” shall have the meaning set forth in Section 8.8(c)(ii).

          “Licenses”
shall mean all permits, licenses, franchises, utility reservations,
certificates of occupancy, and other documents issued by any federal, state, or
municipal authority or by any private party related to the development,
construction, use, occupancy, operation or maintenance of the Hotel, including,
without limitation, all licenses, approvals and rights (including any and all
existing waivers of any brand standard) necessary or appropriate for the
operation of the Hotel under the Brand.

          “Liquor
Licenses” shall have the meaning set forth in Section 8.10.

          “Manager”
shall mean the management company selected by Buyer to manage the Hotel.

          “New
Franchise Agreement” shall mean the franchise license agreement to be
entered into between Buyer and the Franchisor, granting to Buyer a franchise to
operate the Hotel under the Brand on and after the Closing Date. 

          “New
Management Agreement” means the management agreement to be entered into between
Buyer and the Manager for the operation and management of the Hotel on and
after the Closing Date.

          “Other
Property” shall have the meaning set forth in Section 16.14.

          “Pending
Claims” shall have the meaning set forth in Section 7.1(e).

          “Permitted
Exceptions” shall have the meaning set forth in Section 4.3.

          “Personal
Property” shall mean, collectively, all of the Property other than the Real
Property. 

          “PIP”
shall mean a product improvement plan for any Hotel, as required by the
Existing Manager or the Franchisor, if any.

          “Post-Closing
Agreement” shall have the meaning set forth in Section 8.9.

4

          “Property”
shall mean, collectively, (i) all of the following with respect to the Hotel:
the Land, Improvements, Appurtenances, FF&E, Supplies, Leases, Deposits,
Records, Service Contracts, Warranties, Licenses, FF&E Leases, Contracts,
Plans and Specs, Tradenames, Utility Reservations, as well as all other real,
personal or intangible property of Seller related to any of the foregoing and
(ii) any and all of the following that relate to or affect in any way the
design, construction, ownership, use, occupancy, leasing, maintenance, service
or operation of the Real Property, FF&E, Supplies, Leases, Deposits or
Records: Service Contracts, Warranties, Licenses, Tradenames, Contracts, Plans
and Specs and FF&E Lease. 

          “Purchase
Price” shall have the meaning set forth in Section 2.2.

          “Real
Property” shall mean, collectively, all Land, Improvements and
Appurtenances with respect to the Hotel. 

          “Records”
shall mean all books, records, promotional material, tenant data, guest history
information (other than any such information owned exclusively by the Existing
Manager), marketing and leasing material and forms (including but not limited
to any such records, data, information, material and forms in the form of
computerized files located at the Hotel), market studies prepared in connection
with Seller’s current annual plan and other materials, information, data, legal
or other documents or records (including, without limitation, all documentation
relating to any litigation or other proceedings, all zoning and/or land use
notices, relating to or affecting the Property, all business plans and
projections and all studies, plans, budgets and contracts related to the
development, construction and/or operation of the Hotel) owned by Seller and/or
in Seller’s possession or control, or to which Seller has access or may obtain
from the Existing Manager, that are used in or relating to the Property and/or
the operation of the Hotel, including the Land, the Improvements or the
FF&E, and proforma budgets and projections and construction budgets and
contracts related to the development and construction of the Hotel and a list
of the general contractors, architects and engineers providing goods and/or
services in connection with the construction of the Hotel, all construction
warranties and guaranties in effect at Closing and copies of the final plans
and specifications for the Hotel.

          “Release”
shall have the meaning set forth in Section 7.1(f).

          “Review
Period” shall have the meaning set forth in Section 3.1.

          “SEC”
shall have the meaning set forth in Section 8.6.

          “Seller
Liens” shall have the meaning set forth in Section 4.3.

          “Seller
Parties” shall have the meaning set forth in Section 7.1(e).

          “Service
Contracts” shall mean contracts or agreements, such as maintenance, supply,
service or utility contracts.

          “Supplies”
shall mean all merchandise, supplies, inventory and other items used for the
operation and maintenance of guest rooms, restaurants, lounges, swimming pools,
health clubs, spas, business centers, meeting rooms and other common areas and
recreational areas located within or relating to the Improvements, including,
without limitation, all food and beverage

5

 (alcoholic and
non-alcoholic) inventory (opened or unopened), office supplies and stationery,
advertising and promotional materials, china, glasses, silver/flatware, towels,
linen and bedding (all of which shall be 2-par level for all suites or rooms in
the Hotel), guest cleaning, paper and other supplies, upholstery material,
carpets, rugs, furniture, engineers’ supplies, paint and painters’ supplies,
employee uniforms, and all cleaning and maintenance supplies, including those
used in connection with the swimming pools, indoor and/or outdoor sports
facilities, health clubs, spas, fitness centers, restaurants, business centers,
meeting rooms and other common areas and recreational areas.

          “Survey”
shall have the meaning set forth in Section 4.1.

          “Third
Party Consents” shall have the meaning set forth in Section 8.3.

          “Title
Commitment” shall have the meaning set forth in Section 4.2.

          “Title
Company” shall have the meaning set forth in Section 4.2.

          “Title
Policy” shall have the meaning set forth in Section 4.2.

          “Title
Review Period” shall have the meaning set forth in Section 4.3.

          “Tradenames”
shall mean all telephone exchanges and numbers, trade names, trade styles,
trade marks, and other identifying material, and all variations thereof,
together with all related goodwill (it being understood and agreed that the
name of the hotel chain to which the Hotel is affiliated by franchise, license
or management agreement is a protected name or registered service mark of such
hotel chain and cannot be transferred to Buyer by this Contract, provided that
all such franchise, license, management and other agreements granting a right
to use the name of such hotel chain or any other trademark or trade name and
all waivers of any brand standard shall be assigned to Buyer.

          “Utility
Reservations” shall mean Seller’s interest in the right to receive
immediately on and after Closing and continuously consume thereafter water
service, sanitary and storm sewer service, electrical service, gas service and
telephone service on and for the Land and Improvements in capacities that are
adequate continuously to use and operate the Improvements for the purposes for
which they were intended, including, but not limited to (i) any right to the
present and future use of wastewater, drainage, water and other utility
facilities to the extent such use benefits the Real Property, (ii) any
reservations of or commitments covering any such use in the future, and (iii)
any wastewater capacity reservations relating to the Real Property. Buyer shall
be responsible for any requests or documents to transfer the Utility
Reservations, at Buyer’s sole cost and expense. 

          “Warranties”
shall mean all warranties, guaranties, indemnities and claims for the benefit
of Seller with respect to the Hotel, the Property or any portion thereof, including,
without limitation, all warranties and guaranties of the development,
construction, completion, installation, equipping and furnishing of the Hotel,
and all indemnities, bonds and claims of Seller related thereto.

6

ARTICLE
II

PURCHASE AND SALE; PURCHASE PRICE; PAYMENT;

EARNEST MONEY DEPOSIT

          2.1
Purchase and Sale. Seller agrees to sell and convey to Buyer or
its Affiliates and/or assigns, and Buyer or its assigns agrees to purchase from
Seller, the Property, in consideration of the Purchase Price and upon the terms
and conditions hereof. All of the Property shall be conveyed, assigned, and
transferred to Buyer at Closing, free and clear of all mortgages, liens,
encumbrances, licenses, franchises (other than any hotel franchises assumed by
Buyer), concession agreements, security interests, prior assignments or
conveyances, conditions, restrictions, rights-of-way, easements, encroachments,
claims and other matters affecting title or possession, except for the
Permitted Exceptions.

          2.2
Purchase Price. Buyer agrees to pay, and Seller agrees to accept,
as consideration for the conveyance of the Property, subject to the adjustments
provided for in this Contract, the amount of TWENTY-TWO MILLION NINE HUNDRED
THOUSAND and No/100 Dollars ($22,900,000.00) (the “Purchase Price”).

          2.3
Allocation. Buyer and Seller shall attempt to agree, prior to the
expiration of the Review Period, on an allocation of the Purchase Price among
Real Property, tangible Personal Property and intangible property related to
the Property. In the event Buyer and Seller do not agree, each party shall be
free to allocate the Purchase Price to such items as they deem appropriate,
subject to and in accordance with applicable laws.

          2.4
Payment. The portion of the Purchase Price, less the Earnest
Money Deposit and interest earned thereon, if any, which Buyer elects to have
applied against the Purchase Price (as provided below), less the Escrow Funds,
shall be paid to Seller in cash, certified funds or wire transfer, at the
Closing of the Property. At the Closing, the Earnest Money Deposit, together
with interest earned thereon, if any, shall, at Buyer’s election, be returned
to Buyer or shall be paid over to Seller by Escrow Agent to be applied to the portion
of the Purchase Price on behalf of Buyer, and the Escrow Funds shall be
deposited into an escrow account pursuant to the Post-Closing Agreement as
contemplated by Section 8.9. 

          2.5
Earnest Money Deposit.

                    (a)
Within three (3) Business Days after the full execution and delivery of this
Contract, Buyer shall deposit the sum of One Hundred Fifty Thousand and No/100
Dollars ($150,000.00) in cash, certified bank check or by wire transfer of
immediately available funds (the “Initial
Deposit”) with the Title Company, as escrow agent (“Escrow Agent”), which sum shall be held
by Escrow Agent as earnest money. If, pursuant to the provisions of Section 3.1
of this Contract, Buyer elects to terminate this Contract at any time prior to the
expiration of the Review Period, then the Escrow Agent shall return the Earnest
Money Deposit to Buyer promptly upon written notice to that effect from Buyer.
If Buyer does not elect to terminate this Contract on or before the expiration
of the Review Period, Buyer shall, within three (3) Business Days after the
expiration of the Review Period deposit the Additional Deposit with the Escrow
Agent. The Initial Deposit and the Additional Deposit, and all interest accrued
thereon, shall hereinafter be referred to as the “Earnest Money Deposit.”

7

                    (b)
The Earnest Money Deposit shall be held by Escrow Agent subject to the terms
and conditions of an Escrow Agreement dated as of the date of this Contract
entered into by Seller, Buyer and Escrow Agent (the “Escrow Agreement”). The Earnest Money
Deposit shall be held in an interest-bearing account in a federally insured
bank or savings institution reasonably acceptable to Seller and Buyer, with all
interest to accrue to the benefit of the party entitled to receive it and to be
reportable by such party for income tax purposes.

ARTICLE
III

REVIEW PERIOD

          3.1
Review Period. Buyer shall have a period through 6:00 p.m.
Eastern Time on the date that is forty-five (45) days after the date of this
Contract, unless a longer period of time is otherwise provided for in this
Contract and except as otherwise agreed to by Buyer and Seller (the “Review Period”), to evaluate the legal,
title, survey, construction, physical condition, structural, mechanical,
environmental, economic, permit status, franchise status, financial and other
documents and information related to the Property. Within two (2) Business Days
following the date of this Contract, Seller, at Seller’s sole cost and expense,
will deliver to Buyer (or make available at the Hotel) for Buyer’s review, to
the extent not previously delivered to Buyer, true, correct and complete copies
of the following, together with all amendments, modifications, renewals or
extensions thereof:

                    (a)
All Warranties and Licenses relating to the Hotel or any part thereof;

                    (b)
Income and expense statements and budgets for the Hotel, for the current year
to date and each of the three (3) prior fiscal years (the “Financial Statements”), and Seller
shall provide to Buyer copies of all income and expense statements generated by
Seller or any third party that relate to the operations of the Hotel and that
contain information not included in the financial statements, if any, provided
to Buyer by the Existing Manager, provided that Seller also agrees to provide
to Buyer’s auditors and representatives all financial and other information
necessary or appropriate for preparation of audited financial statements for
Buyer and/or its Affiliates as provided in Section 8.6, below;

                    (c)
All real estate and personal property tax statements with respect to the Hotel
and notices of appraised value for the Real Property for the current year (if
available) and each of the three (3) calendar years prior to the current year;

                    (d)
Engineering, mechanical, architectural and construction plans, drawings,
specifications and contracts, payment and performance bonds, title policies,
reports and commitments, zoning information and marketing and economic data
relating to the Hotel and the construction, development, installation and
equipping thereof, as well as copies of all environmental reports and
information, topographical, boundary or “as built” surveys, engineering reports,
subsurface studies and other Contracts, Plans and Specs relating to or
affecting the Hotel. If the Hotel is purchased by Buyer, all such documents and
information relating to the Hotel shall thereupon be and become the property of
Buyer without payment of any additional consideration therefor;

8

                    (e)
All FF&E Leases, Services Contracts, Leases and, if applicable, a schedule
of such Leases of space in the Hotel, and all agreements for real estate
commissions, brokerage fees, finder’s fees or other compensation payable by
Seller in connection therewith; and

                    (f)
All notices received from governmental authorities in connection with the Hotel
and all other notices received from governmental authorities received at any
time that relate to any noncompliance or violation of law that has not been
corrected.

                    (g)
Any other information described on Schedule 3.1 attached hereto.

          Seller
shall, upon request of Buyer, make available to Buyer and Buyer’s
representatives and agents, for inspection and copying during normal business
hours, Records located at Seller’s corporate offices, and Seller agrees to
provide Buyer copies of all other reasonably requested information that is
relevant to the management, operation, use, occupancy or leasing of or title to
the applicable Hotel and the plans specifications for development of the Hotel.
At any time during the Review Period, Buyer may, in its sole and absolute
discretion, elect not to proceed with the purchase of the Property for any
reason whatsoever by giving written notice thereof to Seller, in which event:
(i) the Earnest Money Deposit shall be promptly returned by Escrow Agent to
Buyer together with all accrued interest, if any, (ii) this Contract shall be
terminated automatically, (iii) all materials supplied by Seller to Buyer shall
be returned promptly to Seller, and (iv) both parties will be relieved of all
other rights, obligations and liabilities hereunder, except for the parties’
obligations pursuant to Sections 3.3 and 16.6 below.

          3.2
Due Diligence Examination. At any time during the Review Period,
and thereafter through Closing of the Property, Buyer and/or its
representatives and agents shall have the right to enter upon the Property at
all reasonable times for the purposes of reviewing all Records and other data,
documents and/or information relating to the Property and conducting such
surveys, appraisals, engineering tests, soil tests (including, without
limitation, Phase I and Phase II environmental site assessments), inspections
of construction and other inspections and other studies as Buyer deems
reasonable and necessary or appropriate to evaluate the Property, subject to
providing reasonable advance notice to Seller unless otherwise agreed to by
Buyer and Seller (the “Due Diligence
Examination”). Seller shall have the right to have its
representative present during Buyer’s physical inspections of its Property,
provided that failure of Seller to do so shall not prevent Buyer from exercising
its due diligence, review and inspection rights hereunder. Buyer agrees to
exercise reasonable care when visiting the Property, in a manner which shall
not materially adversely affect the operation of the Property.

          3.3
Restoration. Buyer covenants and agrees not to damage or destroy
any portion of the Property in conducting its examinations and studies of the
Property during the Due Diligence Examination and, if closing does not occur,
shall repair any portion of the Property damaged by the conduct of Buyer, its
agents or employees, to substantially the condition such portion(s) of the
Property were in immediately prior to such examinations or studies. 

          3.4
Seller Exhibits. Buyer shall have until the end of the Review
Period to review and approve the information on Exhibits B, C, D, E and F. In
the event Buyer does not approve any such Exhibit or the information contained
therein, Buyer shall be entitled to terminate this

9

Contract by notice to Seller and the Earnest Money Deposit
shall be returned to Buyer with all interest thereon and both parties shall be
relieved of all rights, obligations and liabilities hereunder except for the
parties’ obligations pursuant to Sections 3.3 and 16.6.

ARTICLE
IV

SURVEY AND TITLE APPROVAL

          4.1
Survey. Seller has delivered to Buyer true, correct and complete
copies of the most recent surveys of the Real Property. In the event that an
update of the survey or a new survey (such updated or new surveys being
referred to as the “Survey”)
are desired by Buyer, then Buyer shall be responsible for all costs related
thereto.

          4.2
Title. Seller has delivered to Buyer its existing title insurance
policy, including copies of all documents referred to therein, for its Real
Property. Buyer’s obligations under this Contract are conditioned upon Buyer
being able to obtain for the Property (i) a Commitment for Title Insurance (the
“Title Commitment”) issued
by Chicago Title Company, Attn: Debby Moore, 5501 LBJ Freeway, Ste. 200,
Dallas, Texas 75240 (the “Title Company”),
for the most recent standard form of owner’s policy of title insurance in the
state in which the Real Property is located, covering the Real Property,
setting forth the current status of the title to the Real Property, showing all
liens, claims, encumbrances, easements, rights of way, encroachments,
reservations, restrictions and any other matters affecting the Real Property
and pursuant to which the Title Company agrees to issue to Buyer at Closing an
Owner’s Policy of Title Insurance on the most recent form of ALTA (where
available) owner’s policy available in the state in which the Land is located,
with extended coverage and, to the extent applicable and available in such
state, comprehensive, access, single tax parcel, survey, contiguity, and such
other endorsements as may be required by Buyer (collectively, the “Title Policy”); and (ii) true,
complete, legible and, where applicable, recorded copies of all documents and
instruments (the “Exception Documents”)
referred to or identified in the Title Commitment, including, but not limited
to, all deeds, lien instruments, leases, plats, surveys, reservations,
restrictions, and easements affecting the Real Property. 

          4.3
Survey or Title Objections. If Buyer discovers any title or
survey matter which is objectionable to Buyer, Buyer may provide Seller with
written notice of its objection to same on or before the expiration of the
Review Period (the “Title Review Period”).
If Buyer fails to so object in writing to any such matter set forth in the
Survey or Title Commitment, it shall be conclusively assumed that Buyer has
approved same. If Buyer disapproves any condition of title, survey or other
matters by written objection to Seller on or before the expiration of the Title
Review Period, Seller shall elect either to attempt to cure or not cure any
such item by written notice sent to Buyer within five (5) days after its
receipt of notice from Buyer, and if Seller commits in writing to attempt to
cure any such item, then Seller shall be given until the Closing Date to cure
any such defect. In the event Seller shall fail to cure a defect which Seller
has committed in writing to cure prior to Closing, or if a new title defect
arises after the date of Buyer’s Title Commitment or Survey, as applicable, but
prior to Closing, then Buyer may elect, in Buyer’s sole and absolute
discretion: (i) to waive such objection and proceed to Closing, or (ii) to
terminate this Contract and receive a return of the Earnest Money Deposit, and
any interest thereon. The items shown on the Title Commitment which are not
objected to by Buyer as set forth above (other than exceptions and title
defects arising after the title review period and other

10

than those standard exceptions which are ordinarily
and customarily omitted in the state in which the applicable Hotel is located,
so long as Seller provides the appropriate owner’s affidavit, gap indemnity or
other documentation reasonably required by the Title Company for such omission)
are hereinafter referred to as the “Permitted
Exceptions.” In no event shall Permitted Exceptions include
liens, or documents evidencing liens, securing any indebtedness (including
vehicle or FF&E leases or financing arrangements) any mechanics’ or
materialmen’s liens or any claims or potential claims therefor covering the
Property or any portion thereof (“Seller
Liens”), each of which shall be paid in full by Seller and
released at Closing. If a vehicle or FF&E lease or other financing cannot
be released at Closing, Seller shall credit Buyer at Closing with the amount
necessary to fully pay off such lease or financing over its term.

ARTICLE
V

MANAGEMENT AGREEMENT AND FRANCHISE AGREEMENT

          At
or prior to the Closing, Seller shall terminate the Existing Management Agreement
and the Existing Franchise Agreement, and Seller shall be solely responsible
for all claims and liabilities arising thereunder on, prior to or following the
Closing Date. As a condition to Closing, Buyer shall enter into the New
Management Agreement and the New Franchise Agreement, effective as of the
Closing Date, containing terms and conditions acceptable to Buyer (including,
without limitation, such terms and conditions as may be required to accommodate
Buyer’s and/or Buyer’s Affiliates’ REIT structure). Seller shall be responsible
for paying all costs related to the termination of the Existing Management
Agreement. Buyer shall be responsible for paying all reasonable and actual
costs of the Franchisor related to the assignment or termination, as applicable,
of the Existing Franchise Agreement. Seller shall use best efforts to promptly
provide all information required by the Franchisor in connection with the New
Franchise Agreement, and Seller and Buyer shall diligently pursue obtaining
each the same. As a condition to Buyer’s and Seller’s obligation to close under
this Contract, Buyer and Manager shall agree, on or before the expiration of
the Review Period, on the form and substance of the New Management Agreement.

ARTICLE
VI

BROKERS

          Seller
and Buyer each represents and warrants to the other that, except for Hotel
Assets Group, L.L.C. (Keith Thompson) for who’s fees and commissions Seller
shall be solely responsible, it has not engaged any broker, finder or other
party in connection with the transaction contemplated by this Contract. Buyer
and Seller each agree to save and hold the other harmless from any and all
losses, damages, liabilities, costs and expenses (including, without
limitation, attorneys’ fees) involving claims made by any other agent, broker,
or other person by or through the acts of Buyer or Seller, respectively, in
connection with this transaction.

ARTICLE
VII

REPRESENTATIONS, WARRANTIES AND COVENANTS

          7.1
Seller’s Representations, Warranties and Covenants. Seller hereby
represents, warrants and covenants to Buyer as follows:

11

                    (a)
Authority; No Conflicts. Seller is a corporation duly formed, validly
existing and in good standing in the State of Mississippi. Seller has obtained
all necessary consents to enter into and perform this Contract and is fully
authorized to enter into and perform this Contract and to complete the
transactions contemplated by this Contract. No consent or approval of any
person, entity or governmental authority is required for the execution,
delivery or performance by Seller of this Contract, except as set forth in Exhibit
D, and this Contract is hereby binding and enforceable against Seller.
Neither the execution nor the performance of, or compliance with, this Contract
by Seller has resulted, or will result, in any violation of, or default under,
or acceleration of, any obligation under any existing corporate charter,
certificate of incorporation, bylaw, articles of organization, limited
liability company agreement or regulations, partnership agreement or other
organizational documents and under any, mortgage indenture, lien agreement,
promissory note, contract, or permit, or any judgment, decree, order,
restrictive covenant, statute, rule or regulation, applicable to Seller or to
the Hotel.

                    (b)
FIRPTA. Seller is not a foreign corporation, foreign partnership,
foreign trust or foreign estate (as those items are defined in the Internal
Revenue Code and Income Tax Regulations).

                    (c)
Bankruptcy. None of Seller, or, to Seller’s knowledge, any of its
partners or members, is insolvent or the subject of any bankruptcy proceeding,
receivership proceeding or other insolvency, dissolution, reorganization or
similar proceeding.

                    (d)
Property Agreements. A complete list of all FF&E Leases, Service
Contracts and Leases (other than those entered into by the Existing Manager on
its own behalf) used in or otherwise relating to the operation and business of
the Hotel is attached hereto as Exhibit C-1, and, to Seller’s knowledge,
a complete list of all other FF&E Leases, Service Contracts and Leases used
in or otherwise relating to the operation and business of the Hotel is attached
hereto as Exhibit C-2. The assets constituting the Property to be
conveyed to Buyer hereunder constitute all of the property and assets of Seller
used in connection with the operation and business of the Hotel. There are no
leases, license agreements, leasing agent’s agreements, equipment leases,
building service agreements, maintenance contracts, suppliers contracts,
warranty contracts, operating agreements, or other agreements (i) to which
Seller is a party or an assignee, or (ii) to Seller’s knowledge, binding
upon the Hotel, relating to the ownership, occupancy, operation, management or
maintenance of the Real Property, FF&E, Supplies or Tradenames, except for
those Service Contracts, Leases, Warranties and FF&E Leases disclosed on Exhibit
C or to be delivered to Buyer pursuant to Section 3.1. The Service Contracts,
Leases, Warranties and FF&E Leases disclosed on Exhibit C or to be
delivered to Buyer pursuant to Section 3.1 are in full force and effect, and no
default has occurred and is continuing thereunder and no circumstances exist
which, with the giving of notice, the lapse of time or both, would constitute
such a default. No party has any right or option to acquire the Hotel or any
portion thereof, other than Buyer.

                    (e)
Pending Claims. There are no: (i) claims, demands, litigation, proceedings
or governmental investigations pending or threatened against Seller, the
Existing Manager or any Affiliate of any of them (collectively, “Seller Parties”) or related to the
business or assets of the Hotel, except as set forth on Exhibit F
attached hereto and incorporated herein by 

12

reference, (ii) special assessments or extraordinary
taxes except as set forth in the Title Commitment or (iii) pending or
threatened condemnation or eminent domain proceedings which would affect the
Property or any part thereof. There are no: pending arbitration proceedings or
unsatisfied arbitration awards, or judicial proceedings or orders respecting
awards, which might become a lien on the Property or any portion thereof,
pending unfair labor practice charges or complaints, unsatisfied unfair labor
practice orders or judicial proceedings or orders with respect thereto, pending
charges or complaints with or by city, state or federal civil or human rights
agencies, unremedied orders by such agencies or judicial proceedings or orders
with respect to obligations under city, state or federal civil or human rights
or antidiscrimination laws or executive orders affecting the Hotel, or other
pending, actual or, to Seller’s knowledge, threatened litigation claims,
charges, complaints, petitions or unsatisfied orders by or before any
administrative agency or court which affect the Hotel or might become a lien on
the Hotel (collectively, the “Pending
Claims”).

                    (f)
Environmental. With respect to environmental matters, (i) there has been
no Release or threat of Release of Hazardous Materials in, on, under, to, from
or in the area of the Real Property, except as disclosed in the reports and
documents set forth on Exhibit E attached hereto and incorporated herein
by reference, (ii) no portion of the Property is being used for the treatment,
storage, disposal or other handling of Hazardous Materials or machinery
containing Hazardous Materials other than standard amounts of cleaning supplies
and chlorine for the swimming pool, all of which are stored on the Property in
strict accordance with applicable Environmental Requirements and do not exceed
limits permitted under applicable laws, including without limitation
Environmental Requirements, (iii) no underground storage tanks are currently
located on or in the Real Property or any portion thereof, (iv) no
environmental investigation, administrative order, notification, consent order,
litigation, claim, judgment or settlement with respect to the Property or any
portion thereof is pending or threatened, (v) there is not currently and, to
Seller’s knowledge, never has been any mold, fungal or other microbial growth
in or on the Real Property, or existing conditions within buildings, structures
or mechanical equipment serving such buildings or structures, that could
reasonably be expected to result in material liability or material costs or
expenses to remediate the mold, fungal or microbial growth, or to remedy such
conditions that could reasonably be expected to result in such growth, and (vi)
except as disclosed on Exhibit E, there are no reports or other
documentation regarding the environmental condition of the Real Property in the
possession of Seller or Seller’s Affiliates, consultants, contractors or
agents. As used in this Contract: “Hazardous
Materials” means (1) “hazardous wastes” as defined by the
Resource Conservation and Recovery Act of 1976, as amended from time to time
(“RCRA”), (2) “hazardous substances” as defined by the Comprehensive
Environmental Response, Compensation and Liability Act of 1980 (42 U.S.C. 9601 et
seq.), as amended by the Superfund Amendment and Reauthorization Act of
1986 and as otherwise amended from time to time (“CERCLA”); (3) “toxic substances” as defined by the Toxic
Substances Control Act, as amended from time to time (“TSCA”), (4) “hazardous materials” as
defined by the Hazardous Materials Transportation Act, as amended from time to
time (“HMTA”), (5)
asbestos, oil or other petroleum products, radioactive materials, urea
formaldehyde foam insulation, radon gas and transformers or other equipment
that contains dielectric fluid containing polychlorinated biphenyls and (6) any
substance whose presence is detrimental or hazardous to health or the
environment, including, without limitation, microbial or fungal matter or mold,
or is otherwise regulated by federal, state and local

13

environmental laws (including, without limitation,
RCRA, CERCLA, TSCA, HMTA), rules, regulations and orders, regulating, relating
to or imposing liability or standards of conduct concerning any Hazardous
Materials or environmental, health or safety compliance (collectively, “Environmental Requirements”). As used
in this Contract: “Release”
means spilling, leaking, pumping, pouring, emitting, emptying, discharging,
injecting, escaping, leaching, dumping or disposing.

                    (g)
Title and Liens. Except for Seller Liens to be released at Closing,
Seller has good and marketable fee simple absolute title to the Real Property,
subject only to the Permitted Exceptions. Except for the FF&E subject to
the FF&E Leases and any applicable Permitted Exceptions, Seller has good
and marketable title to the Personal Property, free and clear of all liens,
claims, encumbrances or other rights whatsoever (other than the Seller Liens
which must be released at Closing), and there are no other liens, claims,
encumbrances or other rights pending or of which any Seller Party has received
notice or which are otherwise known to any Seller Party related to any other
Personal Property.

                    (h)
Utilities. All appropriate utilities, including sanitary and storm
sewers, water, gas, telephone, cable and electricity, are, to Seller’s
knowledge, currently sufficient and available to service the Hotel and all
installation, connection or “tap-on”, usage and similar fees have been paid.

                    (i)
Licenses, Permits and Approvals. Seller has not received any written
notice, and Seller has no knowledge that the Property fails to comply with all
applicable licenses, permits and approvals and federal, state or local
statutes, laws, ordinances, rules, regulations, requirements and codes
including, without limitation, those regarding zoning, land use, building,
fire, health, safety, environmental, subdivision, water quality, sanitation
controls and the Americans with Disabilities Act, and similar rules and
regulations relating and/or applicable to the ownership, use and operation of
the Property as it is now operated. Seller has received all licenses, permits
and approvals required or needed for the lawful conduct, occupancy and
operation of the business of the Hotel, and each license and permit is in full
force and effect, and will be received and in full force and effect as of the
Closing. No licenses, permits or approvals necessary for the lawful conduct,
occupancy or operation of the business of the Hotel, to Seller’s knowledge
requires any approval of a governmental authority for transfer of the Property
except as set forth in Exhibit D.

                    (j)
Financial Statements. Seller has delivered copies of all prior and
current (i) Financial Statements for the Hotel, (ii) operating statements
prepared by the Existing Manager for the Hotel, and (iii) monthly financial
statements prepared by the Existing Manager for the Hotel. Each of such
statements is, to Seller’s knowledge, complete and accurate in all material
respects and, except in the case of budgets prepared in advance of the
applicable operating period to which such budgets relate, fairly presents the
results of operations of the Hotel for the respective periods represented
thereby. Seller has relied upon the Financial Statements in connection with its
ownership and operation of the Hotel, and there are no independent audits or
financial statements prepared by third parties relating to the operation of the
Hotel other than the Financial Statements prepared by or on behalf of the
Existing Manager, all of which have been provided to Buyer.

14

                    (k)
Employees. All employees employed at the Hotel are the employees of the
Existing Manager. There are, to Seller’s knowledge, no (i) unions organized at
the Hotel, (ii) union organizing attempts, strikes, organized work stoppages or
slow downs, or any other labor disputes pending or threatened with respect to
any of the employees at the Hotel, or (iii) collective bargaining or other
labor agreements to which Seller or the Existing Manager or the Hotel is bound
with respect to any employees employed at the Hotel.

                    (l)
Operations. The Hotel has at all times been operated by Existing Manager
in accordance with all applicable laws, rules, regulations, ordinances and
codes.

                    (m)
Existing Management and Franchise Agreements. Seller has furnished to
Buyer true and complete copies of the Existing Management Agreement and the
Existing Franchise Agreement, which constitutes the entire agreement of the
parties thereto with respect to the subject matter thereof and which have not
been amended or supplemented in any respect. There are no other management
agreements, franchise agreements, license agreements or similar agreements for
the operation or management of the Hotel or relating to the Brand, to which
Seller is a party or which are binding upon the Property, except for the Existing
Management Agreement and the Existing Franchise Agreement. The Improvements
comply with, and the Hotel is being operated in accordance with, all
requirements of such Existing Management Agreement and the Existing Franchise
Agreement and all other requirements of the Existing Manager and the
Franchisor, including all “brand standard” requirements of the Existing Manager
and the Franchisor. The Existing Management Agreement and the Existing
Franchise Agreement are in full force and effect, and shall remain in full
force and effect until the termination of the Existing Management Agreement and
the Existing Franchise Agreement at Closing, as provided in Article V hereof.
No default has occurred and is continuing under the Existing Management
Agreement or the Existing Franchise Agreement, and no circumstances exist
which, with the giving of notice, the lapse of time or both, would constitute
such a default. 

                    (n)
Construction of Hotel. 

	
  

 	
  

 
	
  

 	
                     (i)
 The Hotel has been constructed in a good and workmanlike manner without
 encroachments and in accordance in all material respects with the Contracts,
 Plans and Specs, and all building permits and certificates of occupancy
 therefor and all applicable zoning, platting, subdivision, health, safety and
 similar laws, rules, regulations, ordinances and codes.

 
	
  

 	
  

 
	
  

 	
                     
 (ii) The Personal Property is in good condition and operating order.

 
	
  

 	
  

 
	
  

 	
                     (iii)
 Necessary easements for ingress and egress, drainage, signage and utilities
 serving the Hotel have either been dedicated to the public, conveyed to the
 appropriate utility or will be conveyed to Buyer along with the Property.

 

15

          7.2
Buyer’s Representations, Warranties and Covenants. Buyer represents,
warrants and covenants: 

                    (a)
Authority. Buyer is a corporation duly formed, validly existing and in
good standing in the Commonwealth of Virginia. Buyer has received or will have
received by the applicable Closing Date all necessary authorization of the
Board of Directors of Buyer to complete the transactions contemplated by this
Contract. No other consent or approval of any person, entity or governmental
authority is required for the execution, delivery or performance by Buyer of this
Contract, and this Contract is hereby binding and enforceable against Buyer.

                    (b)
Bankruptcy. Buyer is not insolvent nor the subject of any bankruptcy
proceeding, receivership proceeding or other insolvency, dissolution,
reorganization or similar proceeding.

          7.3
Survival. All of the representations and warranties are true,
correct and complete in all material respects as of the date hereof and the
statements set forth therein (without qualification or limitation as to a party’s
knowledge thereof except as expressly provided for in this Article VII) shall
be true, correct and complete in all material respects as of the Closing Date.
All of the representations and warranties made herein shall survive Closing for
a period of two (2) years and shall not be deemed to merge into or be waived by
the Deed or any other closing documents.

ARTICLE
VIII

ADDITIONAL COVENANTS

          8.1
Subsequent Developments. After the date of this Contract and
until the Closing Date, Seller shall use best efforts to keep Buyer fully
informed of all subsequent developments of which Seller has knowledge (“Subsequent Developments”) which would
cause any of Seller’s representations or warranties contained in this Contract
to be no longer accurate in any material respect.

          8.2
Operations. From and after the date hereof through the Closing on
the Property, Seller shall comply with the Existing Management Agreement and
the Existing Franchise Agreement and keep the same in full force and effect and
shall perform and comply with all of the following subject to and in accordance
with the terms of such agreements:

                    (a)
Continue to maintain the Property generally in accordance with prudent business
practices and pursuant to and in compliance with the Existing Management
Agreement and the Existing Franchise Agreement, including, without limitation,
(i) using reasonable efforts to keep available the services of all present
employees at the Hotel and to preserve its relations with guests, suppliers and
other parties doing business with Seller with respect to the Hotel, (ii)
accepting booking contracts for the use of the Hotel’s facilities retaining
such bookings in accordance with the terms of the Existing Management Agreement
and the Existing Franchise Agreement, (iii) maintaining the current level of
advertising and other promotional activities for the Hotel’s facilities, (iv)
maintaining the present level of insurance with respect to the Hotel in full
force and effect until the Closing Date for the Hotel and (v) remaining in
compliance in all material respects with all current Licenses;

16

                    (b)
Keep, observe, and perform in all material respects all its obligations under
and pursuant to the Leases, the Service Contracts, the FF&E Leases, the
Existing Management Agreement, the Existing Franchise Agreement, the Contracts,
Plans and Specs, the Warranties and all other applicable contractual
arrangements relating to the Hotel;

                    (c)
Not cause or permit the removal of FF&E from the Hotel except for the
purpose of discarding worn and valueless items that have been replaced with
FF&E of equal or better quality; timely make all repairs, maintenance, and
replacements to keep all FF&E and all other Personal Property and all Real
Property in good operating condition; keep and maintain the Hotel in a good
state of repair and condition, reasonable and ordinary wear and tear excepted;
and not commit waste of any portion of the Hotel;

                    (d)
Maintain the levels and quality of the Personal Property generally at the
levels and quality existing on the date hereof and keep merchandise, supplies
and inventory adequately stocked, consistent with good business practice, as if
the sale of the Hotel hereunder were not to occur, including, without
limitation, maintaining linens and bath towels at least at a 2-par level for
all suites or rooms of the Hotel;

                    (e)
Advise Buyer promptly of any litigation, arbitration, or administrative hearing
before any court or governmental agency concerning or affecting the Hotel which
is instituted or threatened after the date of this Contract or if any
representation or warranty contained in this Contract shall become false;

                    (f)
Not take, or purposefully omit to take, any action that would have the effect
of violating any of the representations, warranties, covenants or agreements of
Seller contained in this Contract;

                    (g)
Pay or cause to be paid all taxes, assessments and other impositions levied or
assessed on the Hotel or any part thereof prior to the delinquency date, and
comply with all federal, state, and municipal laws, ordinances, regulations and
orders relating to the Hotel;

                    (h)
Not sell or assign, or enter into any agreement to sell or assign, or create or
permit to exist any lien or encumbrance (other than a Permitted Exception) on,
the Property or any portion thereof; and

                    (i)
Not allow any permit, receipt, license, franchise or right currently in
existence with respect to the operation, use, occupancy or maintenance of the
Hotel to expire, be canceled or otherwise terminated.

          Neither
Seller nor Existing Manager shall, without first obtaining the written approval
of Buyer, which approval shall not be unreasonably withheld, enter into any new
FF&E Leases, Service Contracts, Leases or other contracts or agreements
related to the Hotel, or extend any existing such agreements, unless such
agreements (x) can be terminated, without payment or penalty, upon thirty (30)
days’ prior notice or (y) will expire prior to the Closing Date.

          8.3
Third Party Consents. Prior to the Closing Date, Seller shall, at
its expense, (i) obtain any and all third party consents and approvals (x)
required in order to transfer the Hotel to Buyer, or (y) which, if not
obtained, would materially adversely affect the operation of the Hotel, 

17

including, without limitation, all consents and
approvals referred to on Exhibit D and (ii) use best efforts to obtain
all other third party consents and approvals (all of such consents and
approvals in (i) and (ii) above being referred to collectively as, the “Third Party Consents”).

          8.4
Employees. Upon reasonable prior notice to Seller by Buyer, Buyer
and its employees, representatives and agents shall have the right to
communicate with Seller’s staff, and, subject to the approval of the Existing
Manager, the Hotel staff and the Existing Manager’s staff, including without
limitation the general manager, the director of sales, the engineering staff
and other key management employees of the Hotel, at any time before Closing.
Buyer shall not interfere with the operations of the Hotel while engaging in
such communication in a manner that materially adversely affects the operation
of any Property or the Existing Management Agreements. 

          8.5
Estoppel Certificates. Seller shall obtain from (i) each tenant
under any Lease affecting the Hotel (but not from current or prospective
occupants of hotel rooms and suites within the Hotel) and (ii) each lessor
under any FF&E Lease for the Hotel identified by Buyer as a material
FF&E Lease, the estoppel certificates substantially in the forms provided
by Buyer to Seller, and deliver to Buyer not less than five (5) days before the
Closing.

          8.6
Access to Financial Information. Buyer’s representatives shall
have access to, and Seller and its Affiliates shall cooperate with Buyer and
furnish upon request, all financial and other information relating to the
Hotel’s operations to the extent necessary to enable Buyer’s representatives to
prepare audited financial statements in conformity with Regulation S-X of the
Securities and Exchange Commission (the “SEC”)
and other applicable rules and regulations of the SEC and to enable them to
prepare a registration statement, report or disclosure statement for filing
with the SEC on behalf of Buyer or its Affiliates, whether before or after
Closing and regardless of whether such information is included in the Records
to be transferred to Buyer hereunder. Seller shall also provide to Buyer’s
representative a signed representation letter in form and substance reasonably
acceptable to Seller sufficient to enable an independent public accountant to
render an opinion on the financial statements related to the Hotel. Buyer will
reimburse Seller for costs reasonably incurred by Seller to comply with the
requirements of the preceding sentence to the extent that Seller is required to
incur costs not in the ordinary course of business for third parties to provide
such representation letters. The provisions of this Section shall survive
Closing or termination of this Contract.

          8.7
Bulk Sales. At Seller’s risk and expense, Seller shall take all
steps necessary to comply with the requirements of a transferor under all bulk
transfer laws, if any, that are applicable to the transactions contemplated by
this Contract. 

          8.8
Indemnification. If the transactions contemplated by this
Contract are consummated as provided herein:

                    (a)
Indemnification of Buyer. Without in any way limiting or diminishing the
warranties, representations or agreements herein contained or the rights or
remedies available to Buyer for a breach hereof, Seller hereby agrees to
indemnify, defend and hold harmless Buyer and its respective designees,
successors and assigns from and against all losses, judgments, liabilities,
claims, damages or expenses (including reasonable attorneys’ fees) of every
kind, 

18

nature and
description in existence before, on or after Closing, whether known or unknown,
absolute or continent, joint or several, arising out of or relating to: 

	
  

 	
  

 
	
  

 	
                               (i)
 any claim made or asserted against Buyer or any of the Property by a creditor
 of Seller, including any claims based on or alleging a violation of any bulk
 sales act or other similar laws; 

 
	
  

 	
  

 
	
  

 	
                               (ii)
 the breach of any representation, warranty, covenant or agreement of Seller
 contained in this Contract; 

 
	
  

 	
  

 
	
  

 	
                               (iii)
 any liability or obligation of Seller not expressly assumed by Buyer pursuant
 to this Contract; 

 
	
  

 	
  

 
	
  

 	
                               (iv)
 any claim made or asserted by an employee of Seller arising out of Seller’s
 decision to sell the Property; and 

 
	
  

 	
  

 
	
  

 	
                               (v)
 the conduct and operation by or on behalf of Seller of its Hotel or the
 ownership, use or operation of its Property prior to Closing. 

 

                    (b)
Indemnification of Seller. Without in any way limiting or diminishing
the warranties, representations or agreements herein contained or the rights or
remedies available to Seller for a breach hereof, Buyer hereby agrees, with
respect to this Contract, to indemnify, defend and hold harmless Seller from
and against all losses, judgments, liabilities, claims, damages or expenses
(including reasonable attorneys’ fees) of every kind, nature and description in
existence before, on or after Closing, whether known or unknown, absolute or
contingent, joint or several, arising out of or relating to: 

	
  

 	
  

 
	
  

 	
                               (i) the breach of any representation, warranty, covenant or agreement of Buyer
 contained in this Contract; 

 
	
  

 	
  

 
	
  

 	
                               (ii) the conduct and operation by Buyer of its business at the Hotel after
 the Closing; and 

 
	
  

 	
  

 
	
  

 	
                               (iii) any liability or obligation of Buyer expressly assumed by Buyer at Closing.
 

 

                    (c)
Indemnification Procedure for Claims of Third Parties. Indemnification, with
respect to claims resulting from the assertion of liability by those not
parties to this Contract (including governmental claims for penalties, fines
and assessments), shall be subject to the following terms and conditions:  

	
  

 	
  

 
	
  

 	
                               
 (i) The party seeking indemnification (the “Indemnified
 Party”) shall give prompt written notice to the party or parties
 from which it is seeking indemnification (the “Indemnifying Party”) of any assertion of liability by a
 third party which might give rise to a claim for indemnification based on the
 foregoing provisions of this Section 8.8, which notice shall state the nature
 and basis of the assertion and the amount thereof, to the extent known;
 provided, however, that no delay on the part of the Indemnified Party in
 giving notice shall relieve the Indemnifying Party of any obligation 

 

19

	
  

 	
  

 
	
  

 	
 to indemnify
 unless (and then solely to the extent that) the Indemnifying Party is
 prejudiced by such delay. 

 
	
  

 	
  

 
	
  

 	
                               
 (ii) If in any action, suit or proceeding (a “Legal Action”) the relief sought is solely the payment of
 money damages, and if the Indemnifying Party specifically agrees in writing
 to indemnify such Indemnified Party with respect thereto and demonstrates to
 the reasonable satisfaction of such Indemnified Party its financial ability
 to do so, the Indemnifying Party shall have the right, commencing thirty (30)
 days after such notice, at its option, to elect to settle, compromise or
 defend, pursuant to this paragraph, by its own counsel and at its own
 expense, any such Legal Action involving such Indemnified Party’s asserted
 liability. If the Indemnifying Party does not undertake to settle, compromise
 or defend any such Legal Action, such settlement, compromise or defense shall
 be conducted in the sole discretion of such Indemnified Party, but such
 Indemnified Party shall provide the Indemnifying Party with such information
 concerning such settlement, compromise or defense as the Indemnifying Party
 may reasonably request from time to time. If the Indemnifying Party
 undertakes to settle, compromise or defend any such asserted liability, it
 shall notify such Indemnified Party in writing of its intention to do so within
 thirty (30) days of notice from such Indemnified Party provided above. 

 
	
  

 	
  

 
	
  

 	
                               
 (iii) Notwithstanding the provisions of the previous subsection of this Contract,
 until the Indemnifying Party shall have assumed the defense of the Legal
 Action, the defense shall be handled by the Indemnified Party. Furthermore,
 (x) if the Indemnified Party shall have reasonably concluded that there are
 likely to be defenses available to it that are different from or in addition
 to those available to the Indemnifying Party; (y) if the Legal Action
 involves other than money damages and seeks injunctive or other equitable
 relief; or (z) if a judgment against Buyer, as the Indemnified Party, in the
 Legal Action will, in the good faith opinion of Buyer, establish a custom or
 precedent which will be adverse to the best interest of the continuing
 business of the Hotel, the Indemnifying Party, shall not be entitled to
 assume the defense of the Legal Action and the defense shall be handled by
 the Indemnified Party, provided that, in the case of clause (z), the
 Indemnifying Party shall have the right to approve legal counsel selected by
 the Indemnified Party, such approval not to be unreasonably withheld, delayed
 or conditioned. If the defense of the Legal Action is handled by the
 Indemnified Party under the provisions of this subsection, the Indemnifying
 Party shall pay all legal and other expenses reasonably incurred by the
 Indemnified Party in conducting such defense. 

 
	
  

 	
  

 
	
  

 	
                               
 (iv) In any Legal Action initiated by a third party and defended by the
 Indemnifying Party (w) the Indemnified Party shall have the right to be
 represented by advisory counsel and accountants, at its own expense, (x) the
 Indemnifying Party shall keep the Indemnified Party fully informed as to the
 status of such Legal Action at all stages thereof, whether or not the
 Indemnified Party is represented by its own counsel, (y) the Indemnifying
 Party shall make available to the Indemnified Party and its attorneys,
 accounts and other representatives, all books and records of Seller relating
 to such Legal Action and (z) the parties shall render to each other such
 assistance as may be reasonably required in order to ensure the proper and
 adequate defense of such Legal Action. 

 

20

	
  

 	
  

 
	
  

 	
                               
 (v) In any Legal Action initiated by a third party and defended by the Indemnifying
 Party, the Indemnifying Party shall not make settlement of any claim without
 the written consent of the Indemnified Party, which consent shall not be
 unreasonably withheld. Without limiting the generality of the foregoing, it
 shall not be deemed unreasonable to withhold consent to a settlement
 involving injunctive or other equitable relief against Buyer or its respective
 assets, employees, Affiliates or business, or relief which Buyer reasonably
 believes could establish a custom or precedent which will be adverse to the
 best interests of its continuing business. 

 

          8.9
Escrow Funds. To provide for the timely payment of any post-closing claims by
Buyer against Seller hereunder, at Closing, Seller shall deposit an amount
equal to One Hundred Thousand and No/100 Dollars ($100,000.00) (the “Escrow Funds”) which shall be withheld from
the Purchase Price payable to Seller and shall be deposited for a period of one
(1) year in an escrow account with the Title Company pursuant to an escrow
agreement reasonably satisfactory in form and substance to Buyer and Seller
(the “Post-Closing Agreement”),
which escrow and Post-Closing Agreement shall be established and entered into
at Closing and shall be a condition to Buyer’s obligations under this Contract.
If no claims have been asserted by Buyer against Seller, or all such claims
have been satisfied, within such 1-year period, the Escrow Funds deposited by
Seller shall be released to Seller.  

          8.10
Liquor Licenses. As a condition to Buyer’s obligations under this Contract, (i)
the Manager or an Affiliate thereof approved by Buyer shall have or shall have
obtained all liquor licenses and alcoholic beverage licenses necessary or
desirable to operate any restaurants, bars and lounges presently located within
the Hotel (collectively, the “Liquor Licenses”)
and, in the case of an Affiliate of the Manager, the Hotel has the right to use
such Liquor License, (ii) if permitted under the laws of the jurisdiction in
which the Hotel is located, the Manager shall execute and file any and all
necessary forms, applications and other documents (and Seller shall cooperate
with the Manager in filing such forms, applications and other documents) with
the appropriate liquor and alcoholic beverage authorities prior to Closing so
that the Liquor Licenses remain in full force and effect upon completion of
Closing.  

          8.11
Ground Lease. Seller and Buyer acknowledge that the Seller has a leasehold
interest in the Land pursuant to that certain [NAME OF AGREEMENT] dated
________________ (the “Ground Lease”)
between _____________________________ (“Ground
Lessor”) and Seller, and a fee simple interest in the Improvements
thereon. Seller shall obtain and deliver to Buyer at Closing a consent from the
Ground Lessor to the assignment of the Ground Lease to Buyer and an estoppel
certificate from the Ground Lessor (the “Ground
Lease Estoppel”) in form and with information contained therein
reasonably acceptable to Buyer. As part of the consideration for this sale,
Buyer shall assume and agree to perform all obligations of the Seller under the
Ground Lease that are first required to be performed from and after Closing it
being understood and agreed that Buyer has no obligation for, and Seller shall
indemnify Buyer from and against, any liabilities and obligations under the
Ground Lease for acts and omissions or other defaults occurring prior to
Closing. Buyer shall cooperate with Seller in Seller’s efforts related to the
assignment of the Ground Lease including executing such applications,
certificates and other documents reasonably required by the Ground Lessor and
providing any information reasonably required by the Ground Lessor pursuant to,
required by and in connection with the assignment of the Ground Lease.  

21

ARTICLE IX

CONDITIONS FOR CLOSING

          9.1 Buyer’s
Conditions for Closing. Unless otherwise waived in writing, and without
prejudice to Buyer’s right to cancel this Contract during the Review Period,
the duties and obligations of Buyer to proceed to Closing under the terms and
provisions of this Contract are and shall be expressly subject to strict
compliance with, and satisfaction or waiver of, each of the conditions and
contingencies set forth in this Section 9.1, each of which shall be deemed
material to this Contract. In the event of the failure of any of the conditions
set forth in this Section 9.1 or of any other condition to Buyer’s obligations
provided for in this Contract, which condition is not waived in writing by
Buyer, Buyer shall have the right at its option to declare this Contract
terminated, in which case the Earnest Money Deposit and any interest thereon
shall be immediately returned to Buyer and each of the parties shall be
relieved from further liability to the other, except as otherwise expressly
provided herein, with respect to this Contract.

                    (a) All
of Seller’s representations and warranties contained in or made pursuant to
this Contract shall be true and correct in all material respects as if made
again on the Closing Date.

                    (b) Buyer
shall have received all of the instruments and conveyances listed in Section
10.2.

                    (c) Seller
shall have performed, observed and complied in all material respects with all
of the covenants, agreements, closing requirements and conditions required by
this Contract to be performed, observed and complied with by Seller, as and
when required hereunder.

                    (d) All
Liquor Licenses shall be in full force and effect and shall remain in full
force and effect following Closing and shall have been or shall be transferred
to, or new Liquor Licenses issued to, the Manager or an Affiliate thereof
approved by Buyer at or as of Closing, and Buyer shall have received
satisfactory evidence thereof.

                    (e) Third
Party Consents in form and substance satisfactory to Buyer shall have been
obtained and furnished to Buyer.

                    (f) The
Escrow Funds shall have been deposited in the escrow account pursuant to the
Post-Closing Agreement and the parties thereto shall have entered into the
Post-Closing Agreement.

                    (g) The
Existing Management Agreement and the Existing Franchise Agreement shall have
been terminated.

                    (h) Buyer
and the Manager shall have executed and delivered the New Management Agreement
and Buyer and the Franchisor shall have executed and delivered the New
Franchise Agreement, in each case upon terms and conditions acceptable to Buyer
in its sole and absolute discretion.

22

                    (i) Ground
Lessor shall have executed and delivered to the Title Company the Ground Lease
Estoppel and the Assignment of Ground Lease.

          9.2 Seller’s
Conditions for Closing. Unless otherwise waived in writing, and without
prejudice to Seller’s right to cancel this Contract during the Review Period,
the duties and obligations of Seller to proceed to Closing under the terms and
provisions of this Contract are and shall be expressly subject to strict
compliance with, and satisfaction or waiver of, each of the conditions and
contingencies set forth in this Section 9.2, each of which shall be deemed
material to this Contract. In the event of the failure of any of the conditions
set forth in this Section 9.2, which condition is not waived in writing by
Seller, Seller shall have the right at its option to declare this Contract
terminated and null and void, in which case the remaining Earnest Money Deposit
and any interest thereon shall be immediately returned to Buyer and each of the
parties shall be relieved from further liability to the other, except as
otherwise expressly provided herein.

                    (a) All
of Buyer’s representations and warranties contained in or made pursuant to this
Contract shall be true and correct in all material respects as if made again on
the Closing Date.

                    (b) Seller
shall have received all of the money, instruments and conveyances listed in
Section 10.3.

                    (c) Buyer
shall have performed, observed and complied in all material respects with all
of the covenants, agreements, closing requirements and conditions required by
this Contract to be performed, observed and complied with by Buyer, as and when
required hereunder.

ARTICLE X

CLOSING AND CONVEYANCE

          10.1 Closing.
Unless otherwise agreed by Buyer and Seller, the Closing on the Property shall
occur on a date selected by Buyer that is the later of (a) fifteen (15)
business days after expiration of the Review Period or (b) the date Buyer
receives the New Franchise Agreement executed by the Franchisor, provided in
either case that all conditions to Closing by Buyer hereunder have been
satisfied. The date on which the Closing is to occur as provided in this
Section 10.1, or such other date as may be agreed upon by Buyer and Seller, is
referred to in this Contract as the “Closing Date” for the Property. The
Closing shall be held via escrow at the offices of the Title Company, or as
otherwise determined by Buyer and Seller.

          10.2 Deliveries
of Seller. At Closing, Seller shall deliver to Buyer the following, and, as
appropriate, all instruments shall be properly executed and conveyance
instruments to be acknowledged in recordable form (the terms, provisions and
conditions of all instruments not attached hereto as Exhibits shall be mutually
agreed upon by Buyer and Seller prior to such Closing):

                    (a) Deed
and Assignment of Ground Lease. A Special Warranty Deed (subject to the
Ground Lease) conveying to Buyer fee simple title to the Improvements and an 

23

Assignment of
Ground Lease conveying Seller’s leasehold interest in the Real Property (other
than the Improvements), subject only to the Permitted Exceptions (the “Deed”).

                    (b) Bills
of Sale. Bills of sale to Buyer and/or its designated Lessee, conveying
title to the tangible Personal Property (other than the alcoholic beverage
inventories, which, at Buyer’s election, shall be transferred by Seller to the
Manager as holder of the Liquor Licenses required for operation of the Hotel).

                    (c) Existing
Management and Franchise Agreements. The termination of the Existing
Management Agreement and the Existing Franchise Agreement.

                    (d) General
Assignments. Assignments of all of Seller’s right, title and interest in
and to all FF&E Leases, Service Contracts and Leases identified on Exhibit
C hereto (the “Hotel Contracts”). The assignment shall
also be a general assignment and shall provide for the assignment of all of
Seller’s right, title and interest in all Records, Warranties, Licenses,
Tradenames, Contracts, Plans and Specs and all other intangible Personal
Property applicable to the Hotel. The assignments shall contain
cross-indemnities by Buyer and Seller for their respective periods of
ownership.

                    (e) FIRPTA;
1099. A FIRPTA Affidavit or Transferor’s Certificate of Non-Foreign Status
as required by Section 1445 of the Internal Revenue Code and an IRS Form 1099.

                    (f) Title
Company Documents. All affidavits, gap indemnity agreements and other
documents reasonably required by the Title Company. At Buyer’s sole expense,
Buyer shall have obtained an irrevocable commitment directly from the Title
Company (or in the event the Title Company is not willing to issue said
irrevocable commitment, then from such other national title company as may be
selected by either Buyer or Seller) for issuance of an Owner’s Policy of Title
Insurance to Buyer insuring good and marketable fee simple absolute title to
the Real Property constituting part of the Property, subject only to the
Permitted Exceptions in the amount of the Purchase Price.

                    (g) Possession;
Estoppel Certificates. Possession of the Property, subject only to rights
of guests in possession and tenants pursuant to written leases included in the
Leases, and estoppel certificates from tenants under Leases and the lessors
under FF&E Leases in form and substance acceptable to Buyer.

                    (h) Vehicle
Titles. The necessary certificates of titles duly endorsed for transfer
together with any required affidavits and other documentation necessary for the
transfer of title or assignment of leases from Seller to Buyer of any motor
vehicles used in connection with the Hotel’s operations.

                    (i) Authority
Documents. Certified copy of resolutions of the Board of Directors of
Seller authorizing the sale of the Property contemplated by this Contract,
and/or other evidence reasonably satisfactory to Buyer and the Title Company
that the person or persons executing the closing documents on behalf of Seller
have full right, power and authority to do so, along with a certificate of good
standing of Seller from the State in which the Property is located.

24

                    (j)
Miscellaneous. Such other instruments as are contemplated by this
Contract to be executed or delivered by Seller, reasonably required by Buyer or
the Title Company, or customarily executed in the jurisdiction in which the
Hotel is located, to effectuate the conveyance of property similar to the
Hotel, with the effect that, after the Closing, Buyer will have succeeded to
all of the rights, titles, and interests of Seller related to the Hotel and
Seller will no longer have any rights, titles, or interests in and to the
Hotel. 

                    (k)
Plans, Keys, Records, Etc. To the extent not previously delivered to and
in the possession of Buyer, all Contracts, Plans and Specs, all keys for the
Hotel (which keys shall be properly tagged for identification), all Records,
including, without limitation, all Warranties, Licenses, Leases, FF&E
Leases and Service Contracts for the Hotel. 

                    (l)
Closing Statements. Seller’s Closing Statement, and a certificate
confirming the truth of Seller’s representations and warranties hereunder as of
the Closing Date. 

                    (m)
Ground Lease Documents. A consent to assignment of the Ground Lease to
Buyer and the Ground Lease Estoppel, both executed by the Ground Lessor (or the
current fee title owner and lessor of the Land). 

          10.3
Buyer’s Deliveries. At Closing of the Hotel, Buyer shall deliver the
following: 

                    (a)
Purchase Price. The balance of the Purchase Price, adjusted for the
adjustments provided for in Section 12.1, below, and less any sums to be
deducted therefrom as provided in Section 2.4. 

                    (b)
Authority Documents. Certified copy of resolutions of the Board of
Directors of Buyer authorizing the purchase of the Hotel contemplated by this
Contract, and/or other evidence satisfactory to Seller and the Title Company
that the person or persons executing the closing documents on behalf of Buyer
have full right, power and authority to do so. 

                    (c)
Miscellaneous. Such other instruments as are contemplated by this
Contract to be executed or delivered by Buyer, reasonably required by Seller or
the Title Company, or customarily executed in the jurisdiction in which the
Hotel is located, to effectuate the conveyance of property similar to the
Hotel, with the effect that, after the Closing, Buyer will have succeeded to
all of the rights, titles, and interests of Seller related to the Hotel and
Seller will no longer have any rights, titles, or interests in and to the
Hotel. 

                    (d)
Closing Statements. Buyer’s Closing Statement, and a certificate
confirming the truth of Buyer’s representations and warranties hereunder as of
the Closing Date. 

ARTICLE XI 

COSTS

          All
Closing costs shall be paid as set forth below: 

          11.1
Seller’s Costs. In connection with the sale of the Property contemplated
under this Contract, Seller shall be responsible for all transfer and
recordation taxes, including, without 

25

limitation,
all transfer, mansion, excise, sales, use or bulk transfer taxes or like taxes
on or in connection with the transfer of the Real Property (including the Deed
and Assignment of Ground Lease) and the Personal Property constituting part of
the Property pursuant to the Bill of Sale, and all accrued taxes of Seller
prior to Closing and income, sales and use taxes and other such taxes of Seller
attributable to the sale of the Property to Buyer. Seller shall be responsible
for all costs related to the termination of the Existing Management Agreement
as provided in Article V. Seller shall also be responsible for any costs and
expenses of its attorneys, accountants, appraisers and other professionals,
consultants and representatives. Seller shall also be responsible for payment
of all prepayment penalties and other amounts payable in connection with the
pay-off of any liens and/or indebtedness encumbering all or any portion of the
Property. 

          11.2
Buyer’s Costs. In connection with the purchase of the Property
contemplated under this Contract, Buyer shall be responsible for the costs and
expenses of its attorneys, accountants and other professionals, consultants and
representatives. Buyer shall also be responsible for the costs and expenses in
connection with the preparation of any environmental report, any update to the
survey and the costs and expenses of preparation of the title insurance
commitment and the issuance of the title insurance policy contemplated by
Article IV and the per page recording charges and clerk’s fee for the Deed (if
applicable). Buyer shall also be responsible for the fees for the performance
of the property improvement plan (PIP) review and report by the Franchisor and,
if Closing occurs, Buyer shall be responsible for PIP implementation. 

ARTICLE XII 

ADJUSTMENTS

          12.1
Adjustments. Unless otherwise provided herein, at Closing, adjustments
between the parties shall be made as of 11:59 p.m. on the eve of the Closing
Date (the “Cutoff Time”),
with the income and expenses accrued prior to the Cutoff Time being allocated
to Seller and the income and expenses accruing on and after the Cutoff Time
being allocated to Buyer, all as set forth below. All of such adjustments and
allocations shall be made in cash at Closing and shall be collected through and/or
adjusted in accordance with the terms of the Existing Management Agreement.
Except as otherwise expressly provided herein, all apportionments and
adjustments shall be made on an accrual basis in accordance with generally
accepted accounting principles. Buyer and Seller shall request that the Manager determine the apportionments, allocations,
prorations and adjustments as of the Cutoff Time. 

                    (a)
Taxes. All real estate taxes, personal property taxes, or any other
taxes and special assessments (special or otherwise) of any nature upon the
Property levied, assessed or pending for the calendar year in which the Closing
occurs (including the period prior to Closing, regardless of when due and
payable) shall be prorated as of the Cutoff Time and, if no tax bills or
assessment statements for such calendar year are available, such amounts shall
be estimated on the basis of the best available information for such taxes and
assessments that will be due and payable on the Hotel for the calendar year in
which Closing occurs. Until final tax bills that cover the entire year during
which Closing occurred (such that tax liability can reasonably be determined),
Seller’s obligation to pay its share of taxes shall continue. 

26

                    (b)
Utilities. All suppliers of utilities shall be instructed to read meters
or otherwise determine the charges owing as of the Closing Date for services
prior thereto, which charges shall be allocated to Seller. Charges accruing
after Closing shall be allocated to Buyer. If elected by Seller, Seller shall
be given credit, and Buyer shall be charged, for any utility deposits
transferred to and received by Buyer at Closing. 

                    (c)
Income/Charges. All rents, income and charges receivable or payable
under any Leases and Hotel Contracts applicable to the Property, and any
deposits, prepayments and receipts thereunder, shall be prorated between Buyer
and Seller as of the Cutoff Time. 

                    (d)
Accounts. All working capital accounts, reserve accounts and escrow
accounts (including all FF&E accounts, all PIP accounts, Franchisor
escrows, but excluding amounts held in tax and insurance escrow accounts and
utility deposits to the extent excluded from the definition of Deposits, shall
become the property of Buyer, without additional charge to Buyer and without
Buyer being required to fund the same. 

                    (e)
Guest Ledger. Subject to (f) below, all accounts receivable of
registered guests at the Hotel who have not checked out and were occupying
rooms as of the Cutoff Time, shall be prorated as provided herein. 

                    (f)
Room Rentals. All receipts from guest room rentals and other suite
revenues for the night in which the Cutoff Time occurs shall be split 50/50
between Buyer and Seller. 

                    (g)
Advance Deposits. All prepaid rentals, room rental deposits, and all
other deposits for advance registration, banquets or future services to be
provided on and after the Closing Date shall be credited to Buyer. 

                    (h)
Accounts Receivable. To the extent not apportioned at Closing and
subject to (e) and (f) above, all accounts receivable and credit card claims as
of the Cutoff Time shall remain the property of Seller, and Seller and Buyer
agree that the monies received from debtors owing such accounts receivable
balances after Closing, unless otherwise provided in the New Management
Agreement, shall be applied as expressly provided in such remittance, or if not
specified then to the Seller’s outstanding invoices to such account debtors in
chronological order beginning with the oldest invoices, and thereafter, to
Buyer’s account. 

                    (i)
Accounts Payable. To the extent not apportioned at Closing, any
indebtedness, accounts payable, liabilities or obligations of any kind or
nature related to Seller or the Property for the periods prior to and including
the Closing Date shall be retained by Seller and promptly allocated to Seller
and evidence thereof shall be provided to Buyer, and Buyer shall not be or
become liable therefor, except as expressly assumed by Buyer pursuant to this
Contract, and invoices received in the ordinary course of business prior to
Closing shall be allocated to Seller at Closing. 

                    (j)
Restaurants, Bars, Machines, Other Income. All monies received in
connection with bar, restaurant, banquet and similar and other services at the
Hotel (other than amounts due from any guest and included in room rentals)
prior to the close of business for each such operation for the night in which
the Cutoff Time occurs shall belong to Seller, and all other 

27

receipts and
revenues (not previously described in this Section 12.1) from the operation of
any department of the Hotel shall be prorated between Seller and Buyer at
Closing. 

          12.2
Reconciliation and Final Payment. Seller and Buyer shall reasonably
cooperate after Closing to make a final determination of the allocations and
prorations required under this Contract within one hundred eighty (180) days
after the Closing Date; provided, however, failure to make a final
determination within such period shall not relieve the parties of the
obligation to make a final determination nor shall it relieve any party of the
obligation to pay the other any true-up amounts owed. Upon the final
reconciliation of the allocations and prorations under this Section, the party
which owes the other party any sums hereunder shall pay such party such sums
within ten (10) days after the reconciliation of such sums. The obligations to
calculate such prorations, make such reconciliations and pay any such sums
shall survive the Closing. 

          12.3
Employees. None of the employees of the Hotel shall become employees of
Buyer, as of the Closing Date; instead, such employees shall become employees
of the Manager. Seller shall not give notice under any applicable federal or state
plant closing or similar act, including, if applicable, the Worker Adjustment
and Retraining Notification Provisions of 29 U.S.C., Section 2102, the parties
having agreed that a mass layoff, as that term is defined in 29 U.S.C.,
2101(a)(3), will not have occurred. Any liability for payment of all wages,
salaries and benefits, including, without limitation, accrued vacation pay,
sick leave, bonuses, pension benefits, COBRA rights, and other benefits accrued
or earned by and due to employees at the Hotel through the Cutoff Time,
together with F.I.C.A., unemployment and other taxes and benefits due with
respect to such employees for such period, shall be charged to Seller, in
accordance with the Existing Management Agreement, for the purposes of the
adjustments to be made as of the Cutoff Time. All liability for wages, salaries
and benefits of the employees accruing in respect of and attributable to the
period from and after Closing shall be charged to Buyer, in accordance with the
New Management Agreement. To the extent applicable, all such allocations and
charges shall be adjusted in accordance with the provisions of the Existing
Management Agreement. 

ARTICLE XIII 

CASUALTY AND CONDEMNATION

          13.1
Risk of Loss; Notice. Prior to Closing and the delivery of possession of
the Property to Buyer in accordance with this Contract, all risk of loss to the
Property (whether by casualty, condemnation or otherwise) shall be borne by
Seller. In the event that (a) any loss or damage to the Hotel shall occur prior
to the Closing Date as a result of fire or other casualty, or (b) Seller
receives notice that a governmental authority has initiated or threatened to
initiate a condemnation proceeding affecting the Hotel, Seller shall give Buyer
immediate written notice of such loss, damage or condemnation proceeding (which
notice shall include a certification of (i) the amounts of insurance coverages
in effect with respect to the loss or damage and (ii) if known, the amount of
the award to be received in such condemnation). 

          13.2
Buyer’s Termination Right. If, prior to Closing and the delivery of
possession of the Property to Buyer in accordance with this Contract, (a) any
condemnation proceeding shall be pending against a substantial portion of the
Hotel or (b) there is any substantial casualty loss or damage to the Hotel,
Buyer shall have the option to terminate this Contract, provided Buyer 

28

delivers
written notice to Seller of its election within twenty (20) days after the date
Seller has delivered Buyer written notice of any such loss, damage or
condemnation as provided above, and in such event, the Earnest Money Deposit,
and any interest thereon, shall be delivered to Buyer and thereafter, except as
expressly set forth herein, no party shall have any further obligation or
liability to the other under this Contract. In the context of condemnation,
“substantial” shall mean condemnation of such portion of a Hotel (or access
thereto) as could, in Buyer’s reasonable judgment, render use of the remainder
impractical or unfeasible for the uses herein contemplated, and, in the context
of casualty loss or damage, “substantial” shall mean a loss or damage in excess
of One Hundred Thousand and No/100 Dollars ($100,000.00) in value. 

          13.3
Procedure for Closing. If Buyer shall not timely elect to terminate this
Contract under Section 13.2 above, or if the loss, damage or condemnation is
not substantial, Seller agrees to pay to Buyer at the Closing all insurance
proceeds or condemnation awards which Seller has received as a result of the
same, plus an amount equal to the insurance deductible, and assign to Buyer all
insurance proceeds and condemnation awards payable as a result of the same, in
which event the Closing shall occur without Seller replacing or repairing such
damage. In the case of damage or casualty, at Buyer’s election, Seller shall
repair and restore the Property to its condition immediately prior to such
damage or casualty and shall assign to Buyer all excess insurance proceeds. 

ARTICLE XIV 

DEFAULT REMEDIES

          14.1
Buyer Default. If Buyer defaults under this Contract after the Review
Period, and such default continues for thirty (30) days following written
notice from Seller, then at Seller’s election by written notice to Buyer, this
Contract shall be terminated and of no effect, in which event the Earnest Money
Deposit, including any interest thereon, shall be paid to and retained by the
Seller as Seller’s sole and exclusive remedy hereunder, and as liquidated
damages for Buyer’s default or failure to close, and both Buyer and Seller
shall thereupon be released from all obligations hereunder. 

          14.2
Seller Default. If Seller defaults under this Contract, and such default
continues for thirty (30) days following written notice from Buyer, Buyer may
elect, as Buyer’s sole and exclusive remedy, either (i) to terminate this
Contract by written notice to Seller delivered to that Seller at any time prior
to the completion of such cure, in which event the Earnest Money Deposit,
including any interest thereon, shall be returned to the Buyer, Seller shall
reimburse Buyer for Buyer’s actual and verifiable due diligence costs and
expenses (not to exceed $75,000) and thereafter both the Buyer and Seller shall
thereupon be released from all obligations with respect to this Contract,
except as otherwise expressly provided herein; or (ii) to treat this Contract
as being in full force and effect by written notice to Seller delivered to
Seller at any time prior to the completion of such cure, in which event the
Buyer shall have the right to an action against the defaulting Seller for
damages, specific performance and all other rights and remedies available at
law or in equity. 

          14.3
Attorney’s Fees. Anything to the contrary herein notwithstanding, if it
shall be necessary for either the Buyer or Seller to employ an attorney to
enforce its rights pursuant to this Contract because of the default of the
other party, and the non-defaulting party is successful 

29

in enforcing
such rights, then the defaulting party shall reimburse the non-defaulting party
for the non-defaulting party’s reasonable attorneys’ fees, costs and expenses. 

ARTICLE XV 

NOTICES

          All
notices required herein shall be deemed to have been validly given, as applicable:
(i) if given by fax, when the fax is transmitted to the party’s fax number
specified below and confirmation of complete receipt is received by the
transmitting party during normal business hours or on the next Business Day if
not confirmed during normal business hours, (ii) if hand delivered to a party
against receipted copy, when the copy of the notice is receipted or rejected,
(iii) if given by certified mail, return receipt requested, postage prepaid,
two (2) Business Days after it is posted with the U.S. Postal Service at the
address of the party specified below or (iv) on the next delivery day after
such notices are sent by recognized and reputable commercial overnight delivery
service marked for next day delivery, return receipt requested or similarly
acknowledged: 

	
  

 	
  

 	
  

 
	
  

 	
 If to Buyer:

 	
 Apple Nine
 Hospitality Ownership, Inc.

 
	
  

 	
  

 	
 814 E. Main
 Street

 
	
  

 	
  

 	
 Richmond,
 Virginia 23219

 
	
  

 	
  

 	
 Attention:
 Sam Reynolds

 
	
  

 	
  

 	
 Fax No.:
 (804) 344-8129

 
	
  

 	
  

 	
  

 
	
  

 	
 with a copy
 to:

 	
 Apple Nine
 Hospitality Ownership, Inc.

 
	
  

 	
  

 	
 814 E. Main Street

 
	
  

 	
  

 	
 Richmond,
 Virginia 23219

 
	
  

 	
  

 	
 Attention:
 Legal Dept.

 
	
  

 	
  

 	
 Fax No.:
 (804) 727-6349

 
	
  

 	
  

 	
  

 
	
  

 	
 If to
 Seller:

 	
 Jackie’s
 International, Inc.

 
	
  

 	
  

 	
 1554 West
 Peace Street

 
	
  

 	
  

 	
 Canton,
 Mississippi 39046

 
	
  

 	
  

 	
 Attention:
 S. L. Sethi

 
	
  

 	
  

 	
 Fax No.:
 (601) 855-9305

 

          Addresses
may be changed by the parties hereto by written notice in accordance with this
Section. 

ARTICLE XVI 

MISCELLANEOUS

          16.1
Performance. Time is of the essence in the performance and satisfaction
of each and every obligation and condition of this Contract. 

30

          16.2
Binding Effect; Assignment. This Contract shall be binding upon and
shall inure to the benefit of each of the parties hereto, their respective
successors and assigns. 

          16.3
Entire Agreement. This Contract and the Exhibits constitute the sole and
entire agreement between Buyer and Seller with respect to the subject matter
hereof. No modification of this Contract shall be binding unless signed by both
Buyer and Seller. 

          16.4
Governing Law. The validity, construction, interpretation and
performance of this Contract shall in all ways be governed and determined in
accordance with the laws of the State of Louisiana (without regard to conflicts
of law principles). 

          16.5
Captions. The captions used in this Contract have been inserted only for
purposes of convenience and the same shall not be construed or interpreted so
as to limit or define the intent or the scope of any part of this Contract. 

          16.6
Confidentiality. Except as either party may reasonably determine is
required by law (including without limitation laws and regulations applicable
to Buyer or its Affiliates who may be public companies): (i) prior to Closing,
Buyer and Seller shall not disclose the existence of this Contract or their
respective intentions to purchase and sell the Property or generate or
participate in any publicity or press release regarding this transaction,
except to Buyer’s and Seller’s legal counsel and lender, Buyer’s consultants
and agents, the Manager, the Existing Manager, the Franchisor and the Title
Company and except as necessitated by Buyer’s Due Diligence Examination and/or
shadow management, unless both Buyer and Seller agree in writing and as
necessary to effectuate the transactions contemplated hereby and (ii) following
Closing, the parties shall coordinate any public disclosure or release of
information related to the transactions contemplated by this Contract, and no
such disclosure or release shall be made without the prior written consent of
Buyer, and no press release shall be made without the prior written approval of
Buyer and Seller. 

          16.7
Closing Documents. To the extent any Closing documents are not attached
hereto at the time of execution of this Contract, Buyer and Seller shall negotiate
in good faith with respect to the form and content of such Closing documents
prior to Closing. 

          16.8
Counterparts. This Contract may be executed in counterparts by the
parties hereto, and by facsimile signature, and each shall be considered an
original and all of which shall constitute one and the same agreement. 

          16.9
Severability. If any provision of this Contract shall, for any reason,
be adjudged by any court of competent jurisdiction to be invalid or
unenforceable, such judgment shall not affect, impair or invalidate the
remainder of this Contract but shall be confined in its operation to the
provision or provisions hereof directly involved in the controversy in which
such judgment shall have been rendered, and this Contract shall be construed as
if such provision had never existed, unless such construction would operate as
an undue hardship on Seller or Buyer or would constitute a substantial
deviation from the general intent of the parties as reflected in this Contract.

31

          16.10
Interpretation. For purposes of construing the provisions of this
Contract, the singular shall be deemed to include the plural and vice versa and
the use of any gender shall include the use of any other gender, as the context
may require.  

          16.11
Further Acts. In addition to the acts, deeds, instruments and agreements
recited herein and contemplated to be performed, executed and delivered by
Buyer and Seller, Buyer and Seller shall perform, execute and deliver or cause
to be performed, executed and delivered at the Closing or after the Closing,
any and all further acts, deeds, instruments and agreements and provide such
further assurances as the other party or the Title Company may reasonably
require to consummate the transaction contemplated hereunder. 

          16.12
Joint and Several Obligations. If Seller consists of more than one
person or entity, each such person or entity shall be jointly and severally
liable with respect to the obligations of Seller under this Contract. 

          16.13
Notice of Proposed Listing. In the event that the sale of the Property
contemplated by this Contract is consummated, if at any time during the five
(5) year period commencing on the date of execution of this Contract by Buyer
and Seller, Seller or any of its Affiliates propose to list for sale any hotel
property or properties owned, acquired, constructed or developed by Seller or
their Affiliates and located within a ten (10)-mile radius of the Hotel (any
such other hotel property being referred to as an “Other Property”), Seller shall promptly
deliver to Buyer written notice thereof and Buyer shall have the right to see
and participate in the offering and/or otherwise make an offer to purchase any
such Other Property. 

ARTICLE XVII 

WEST MONROE CONTRACT

          Concurrently
with the execution of this Contract, Buyer is entering into a purchase contract
(the “West Monroe Contract”) with Lodging America of West Monroe, LLC, a
Louisiana limited liability company (the “Monroe Seller”) for the purchase of
the Hilton Garden Inn West Monroe hotel located at 400 Mane Street West Monroe,
LA 71291. Buyer and Seller acknowledge and agree that the closings under this
Contract and the West Monroe Contract must occur simultaneously, that a default
by either party under this Contract that remains uncured in accordance with the
terms of this Contract shall entitle the non-defaulting party to terminate the
West Monroe Contract on notice to the other, and that a default by either party
under the West Monroe Contract shall entitle the non-defaulting party to
terminate this Contract on notice to the other. In addition, in the event of
any occurrence or exercise of any right which results in the termination of the
West Monroe Contract prior to Closing, either party shall have the right to
terminate this Contract upon notice to the other, in which event, unless such
termination resulted from Buyer’s default, the Deposit shall be paid to Buyer.
Notwithstanding the foregoing, in the event of termination of this Contract and
the West Monroe Contract as a result of Buyer’s default under one, but not
both, of such Contracts, the selling party shall only be entitled to retain the
Deposit for the Contract under which Buyer shall have defaulted.
Notwithstanding the foregoing, in the event of a default by Seller, under one,
but not both, of such Contracts, Buyer shall be entitled to either (i)
terminate both this Contract and the West Monroe Contract, or (ii) pursue its
remedies for default of both this Contract and the West Monroe Contract in
accordance with Section14.2 of each Contract. 

32

[Signatures Begin on Following Page]

33

          IN WITNESS
WHEREOF, this Contract has been executed, to be effective as of the date first
above written, by the Buyer and Seller. 

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 SELLER:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 JACKIE’S
 INTERNATIONAL, INC., a Mississippi corporation

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
      /s/ S.L. Sethi

 
	
  

 	
  

 	

 

 
	
  

 	
 Name:

 	
 S.L. Sethi

 
	
  

 	
 Title:

 	
 President

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 BUYER:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 APPLE NINE
 HOSPITALITY OWNERSHIP, INC., a
 Virginia corporation

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
      /s/ Justin G. Knight

 
	
  

 	
  

 	

 

 
	
  

 	
 Name: Justin
 G. Knight

 
	
  

 	
 Title:
 President

 

34

EXHIBIT “A”

LEGAL DESCRIPTION OF LAND

Commencing at
the most easterly southern property corner of the University of Louisiana at
Lafayette; THENCE North 52°07’34” East along the southeastern property line of
the University of Louisiana at Lafayette and the northwestern right of way line
of West Congress Street, a distance of 19.69 feet to a point; THENCE North
37°10’33” West, a distance of 54.98 feet to a point; said point being the
southern corner of the Hotel Site to be leased to Jackie’s International, Inc.
and the POINT OF BEGINNING; THENCE North 37°10’33” West along the southwestern
line of the Hotel Site to be leased to Jackie’s International, Inc., a distance
of 346 feet to the western corner of the Hotel Site; THENCE North 52°49’27”
East along the northwestern line of the Hotel Site to be leased to Jackie’s
International, Inc., a distance of 504.00 feet to the northern corner of the
Hotel Site; THENCE South 37°10’33” East along the northeastern line of the
Hotel Site to be leased to Jackie’s International, Inc., a distance of 346 feet
to the eastern corner of the Hotel Site; THENCE South 52°49’27” West along the
southeastern line of the Hotel Site, a distance of 50400 feet to the southern
corner of the Hotel Site and the Point of Beginning. The tract contains 4.003
acres more or less. 

-i-

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