Document:

LOAN AGREEMENT

 Exhibit 10.48 
 LOAN AGREEMENT 
 THIS LOAN AGREEMENT (the “Agreement”) is made as of the
14th day of December, 2006 by and between APPLE REIT SEVEN, INC., a Virginia corporation (the
“Company”), and WACHOVIA BANK, NATIONAL ASSOCIATION a national banking association (the “Lender”). 
 STATEMENT OF
PURPOSE 
 The Company has requested the Lender to extend to the Company a loan to provide proceeds for working capital and short-term
acquisition funding and the Lender has agreed to do so on the terms and subject to the conditions set forth herein. All capitalized terms not otherwise defined herein are defined in Paragraph 10 hereof. 
 Now, therefore, for good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

 AGREEMENT 
  

	 	1.	Loan Terms. 

 1(a) Loan.
Subject to the conditions set forth herein, the Lender agrees that, so long as no Event of Default has occurred and is continuing, it shall advance to the Company, from time to time from the date hereof until the day immediately preceding the
Maturity Date, up to an aggregate outstanding principal amount equal to the Aggregate Commitment (such advances, the “Loan”). So long as no Event of Default has occurred and is continuing, amounts repaid by the Company prior to the
Maturity Date may be reborrowed by the Company, provided that the aggregate principal amount outstanding at any time shall not exceed the Aggregate Commitment. 
 1(b) Interest Rate. The Loan shall bear interest at the Applicable LIBOR Rate, except as otherwise provided herein. 
 1(c) Payment of Interest. The Company shall pay to the Lender interest on the Loan from the date of initial funding of the Loan to
but not including the date of payment. Interest payable while the Loan is a LIBOR Loan shall be payable in arrears on the last Business Day of each applicable Interest Period, and interest payable while the Loan is a Prime Rate Loan shall be payable
monthly, in arrears, as provided in Paragraph 2(m) below. 
 1(d) Request for Loan. If the Company desires to have the
Lender make an advance under the Loan, the Chief Financial Officer or President of the Company shall make a Loan Request to the Lender no later than 12:00 p.m. on the proposed funding date. The Lender shall make available the amount of the proposed
advance to the Company on the same date. 

 1(e) Intentionally Omitted. 
 1(f) Payment of Commitment Fee. The Company shall pay to the Lender a commitment fee in the amount of Seven Hundred Fifty Thousand
Dollars ($750,000.00) (the “Commitment Fee”) on the date of closing of the Loan, which fee shall be fully earned by the Lender as of such date and shall be non-refundable. 
  

	 	2.	Miscellaneous Lending Provisions. 

 2(a) Use of Proceeds. The proceeds of the Loan shall be used by the Company solely for working capital and short-term acquisition funding. 
 2(b) Note. The obligations of the Company to repay the Loan shall be evidenced by a note payable to the order of the Lender in the form attached hereto as Exhibit A (as amended, restated or
supplemented from time to time, the “Note”). 
 2(c) Repayment of Principal. Subject to the prepayment
requirements of Paragraph 2(k) below, the Company shall pay the then principal amount of the Loan and any accrued and unpaid interest on the Maturity Date. 
 2(d) Inability to Determine Rate. If the Lender determines (which determination shall be conclusive and binding upon the Company, provided such determination is made on a reasonable basis) that by reason of
circumstances affecting the London interbank eurodollar market adequate and reasonable means do not exist for ascertaining the LIBOR Rate for any Interest Period, then the Lender shall forthwith give facsimile notice of such determination, confirmed
in writing, to the Company. If such notice is given, the Loan shall be converted on the last day of the then current Interest Period to a Prime Rate Loan. Until such notice has been withdrawn by the Lender, the Company shall not have the right to
maintain the Loan as a LIBOR Loan. The Lender shall withdraw such notice in the event that the circumstances giving rise thereto no longer obtain and that adequate and reasonable means exist for ascertaining the LIBOR Rate, and following withdrawal
of such notice by the Lender, the Loan shall be maintained as a LIBOR Loan in accordance with the terms and conditions of this Agreement. 
 2(e) Illegality. Notwithstanding any other provisions herein, if any law, regulation, treaty or directive or any change therein or in the interpretation or application thereof, shall make it unlawful for the
Lender to make or maintain the Loan as a LIBOR Loan as contemplated by this Agreement, the Lender shall forthwith give facsimile notice to the Company of such illegality, and upon giving such notice, the Loan shall be converted automatically to a
Prime Rate Loan at the end of the respective Interest Period or within such earlier period as required by law. If subsequently Lender determines that the cause of such illegality has ceased to exist, Lender will notify the Company by facsimile
notice, and the Loan shall thereafter be maintained as a LIBOR Loan in accordance with the terms and conditions of this Agreement. 
  

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 2(f) Requirements of Law; Increased Costs. In the event that any change subsequent
to the date hereof in any applicable law, order, regulation, treaty or directive issued by any central bank or other Governmental Authority, or in the governmental or judicial interpretation or application thereof, or compliance by the Lender with
any request or directive (whether or not having the force of law) by any central bank or other Governmental Authority: 
 (1)
subjects the Lender to any tax of any kind whatsoever with respect to this Agreement or the Loan made hereunder, or change the basis of taxation of payments to the Lender of principal, fee, interest or any other amount payable hereunder (except for
change in the rate of tax on the overall net income of the Lender); 
 (2) imposes, modifies or holds applicable any reserve,
capital requirement, special deposit, compulsory loan or similar requirements against assets held by, or deposits or other liabilities in or for the account of, advances or loans by, or other credit extended by, or any other acquisition of funds by,
any office of the Lender which are not otherwise included in the determination of the LIBOR Rate or the Prime Rate; or 
 (3)
imposes on the Lender any other condition; 
 and the result of any of the foregoing is to increase the cost to Lender of making, renewing or
maintaining the Loan or to reduce any amount receivable in respect thereof or to reduce the rate of return on the capital of such Lender or any Person controlling such Lender, then, in any such case, the Company shall, subject to the provisions
hereof pay to the Lender within 15 days of written demand made by the Lender, any additional amounts necessary to compensate Lender for such additional cost or reduced amounts receivable or rate of return as determined by Lender with respect to this
Agreement or the Loan made hereunder. If Lender becomes entitled to claim any additional amounts pursuant to this Paragraph 2(f), it shall promptly notify the Company of the event by reason of which it has become so entitled. A certificate as to any
additional amounts payable pursuant to the foregoing sentence containing the calculation thereof in reasonable detail submitted by Lender to the Company shall be conclusive in the absence of manifest error. The provisions hereof shall survive the
termination of this Agreement and payment of the outstanding Loan and all other amounts payable hereunder. 
 2(g)
Funding. The Lender shall be entitled to fund all or any portion of the Loan in any manner it may determine in its sole discretion. All calculations and transactions hereunder shall be conducted as though such Lender actually funds the Loan
as a LIBOR Loan through the purchase in London of offshore dollar deposits in the amount of the Loan in maturities corresponding to the applicable Interest Period. 
 2(h) Intentionally Omitted. 
 2(i) Intentionally Omitted. 
  

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 2(j) Computations. All computations of interest and fees payable hereunder shall
be based upon a year of 360 days for the actual number of days elapsed. 
 2(k) Prepayments. 
 (1) The Company may voluntarily prepay the Loan in whole or in part at any time. 
 (2) The Company shall pay all interest accrued but unpaid concurrently with the prepayment of any principal. 
 (3) Unless the Lender elects, in its sole discretion, to exempt any portion of any Equity Proceeds from the requirements of this Paragraph
2(k)(3) upon a request by the Company for any such exemption, the Company shall make mandatory prepayments of principal in an amount equal to one hundred percent (100%) of all Equity Proceeds (the “Mandatory Equity Payments”).
Mandatory Equity Payments shall be due and payable to Lender no later than the date described in Paragraph 6(i) hereof. The Aggregate Commitment shall be permanently reduced by the amount of any Mandatory Equity Payment made pursuant to this
Paragraph 2(k)(3). 
 2(l) Intentionally Omitted. 
 2(m) Interest and Fee Billing and Payment. The Lender shall (1) while the Loan is a LIBOR Loan, in the last day of the
applicable Interest Period, and (2) while the Loan is a Prime Rate Loan, on or before the fifth Business Day of each month, deliver to the Company an interest and fee billing for the immediately preceding month or Interest Period, as the case
may be, which billing shall set forth interest accrued and payable on the Loan and fees payable hereunder for such period and which billing shall be payable, in the case of a billing delivered pursuant to subparagraph (1) above, on the last day
of the applicable Interest Period and, in the case of a billing delivered pursuant to subparagraph (2) above, no later than the second Business Day following receipt thereof by the Company. In the alternative, the Company may, within one
(1) Business Day following receipt of such billing by the Company, authorize the Lender by telephone (which authorization shall be promptly followed by a written confirmation thereof) to debit the Company’s accounts maintained with the
Lender for the amount of such accrued interest and fees payable. 
 2(n) Nature and Place of Payments. All payments
made on account of the Obligations shall be made without set-off or counterclaim in lawful money of the United States of America in immediately available same day funds, free and clear of and without deduction for any taxes, fees or other charges of
any nature whatsoever imposed by any taxing authority upon the Lender and if received by the Lender by 2:00 p.m. (Charlotte, North Carolina time) such payment will be credited on the Business Day received. If a payment is received after 2:00 p.m.
(Charlotte, North Carolina time) by the Lender, such payment will be credited on the next succeeding Business Day and interest thereon shall 

  

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be payable at the then applicable rate until credited. If any payment required to be made by the Company hereunder becomes due and payable on a day other
than a Business Day, the due date thereof shall be extended to the next succeeding Business Day and interest thereon shall be payable at the then applicable rate during such extension. 
 2(o) Post-Maturity Interest. Any Obligations not paid when due (whether at stated maturity, upon acceleration or otherwise) shall
bear interest from the date due until paid in full at a per annum rate equal to four percent (4%) above the then applicable interest rate, or, if such Obligations do not otherwise bear interest, four percent (4%) above the Applicable Prime
Rate. 
  

	 	3.	Intentionally Omitted. 

  

	 	4.	Conditions to Making of the Loan. 

 4(a) As conditions precedent to the Lender’s obligation to make the initial Loan hereunder: 
 (1) The Company
shall have delivered, and shall have caused the Guarantors to deliver, to the Lender, in form and substance satisfactory to the Lender and its counsel, each of the following: 
 (A) A duly executed original of this Agreement; 
 (B) A duly executed original of the Note; 
 (C) Guaranty agreements, each in the form attached hereto as Exhibit B (collectively, the “Guaranties”) executed by each of the Guarantors in favor of the Lender in which the Guarantors
irrevocably and unconditionally guarantee the payment when due, upon maturity, acceleration or otherwise, of the Obligations; 
 (D) Such credit applications, financial statements, authorizations and such information concerning the Company and the Guarantors and their businesses, operations and conditions (financial and otherwise) as the Lender may reasonably
request; 
 (E) A certificate of the Secretary or an Assistant Secretary of the Company certifying the names and true
signatures of the officers of the Company authorized to execute and deliver the Loan Documents; 
 (F) A copy of the Articles
of Incorporation of the Company certified by the Secretary or an Assistant Secretary of the Company as of the date of this Agreement as being accurate and complete; 
 (G) A copy of the Bylaws of the Company certified by the Secretary or an Assistant Secretary of the Company as of the date of this
Agreement as being accurate and complete; 
  

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 (H) Resolutions of the Company adopted by the requisite parties authorizing the Company
to enter into the Loan and to execute and deliver the Loan Documents to which the Company is a party; 
 (I) A certificate of
the Secretary of State of the State of Virginia, certifying as of a recent date that the Company is in good standing; 
 (J) A
certificate of the Secretary or an Assistant Secretary (or analogous officer) of each of the Guarantors certifying the names and true signatures of the officers of such Guarantor authorized to execute and deliver the Loan Documents to which such
Guarantor is a party; 
 (K) A copy of the Articles of Incorporation, Certificate of Limited Partnership or Certificate of
Formation, as applicable, of each of the Guarantors certified by the Secretary or an Assistant Secretary (or analogous officer) of such Guarantor as of the date of this Agreement as being accurate and complete; 
 (L) A copy of the Bylaws, Limited Partnership Agreement or Operating Agreement, as applicable, of each of the Guarantors certified by the
Secretary or an Assistant Secretary (or analogous officer) of such Guarantor as of the date of this Agreement as being accurate and complete; 
 (M) Resolutions of each of the Guarantors adopted by the requisite parties authorizing such Guarantor to execute and deliver the Loan Documents to which such Guarantor is a party; 
 (N) With respect to each Guarantor, a certificate of the secretary of state of (1) the state in which such Guarantor is organized,
and (ii) each state in which such Guarantor (or in which the Guarantor of which such Guarantor is a general partner, if applicable) owns an Owned Hotel, in each case certifying as of a recent date that such Guarantor is in good standing, and

 (O) An opinion of counsel for the Company and each of the Guarantors in form and substance satisfactory to the Lender and
its counsel. 
 (2) All acts and conditions (including, without limitation, the obtaining of any necessary regulatory
approvals and the making of any required filings, recordings or registrations) required to be done and performed and to have happened precedent to the execution, delivery and performance of the Loan Documents and to constitute the same legal, valid
and binding obligations, enforceable in accordance with their respective terms, shall have been done and performed and shall have happened in due and strict compliance with all applicable laws. 
 (3) All documentation, including, without limitation, documentation for corporate and legal proceedings in connection with the
transactions contemplated by the 

  

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Loan Documents shall be satisfactory in form and substance to the Lender and its counsel, and all legal and financial due diligence on the Company and the
Guarantors and their operations and conditions shall be completed and shall be satisfactory to Lender and its counsel. 
 (4)
The Company shall have paid the Commitment Fee to the Lender. 
 4(b) As conditions precedent to the Lender’s obligation
to make any advance hereunder (including without limitation the initial Loan): 
 (1) The Company shall have delivered a Loan
Request for such advance to the Lender. 
 (2) The representations and warranties of the Company and the Guarantors contained
in the Loan Documents shall be accurate and complete in all material respects as if made on and as of the date of such advance. 
 (3) There shall not have occurred an Event of Default which is continuing. 
 (4) Following the funding of the
requested advance, the aggregate principal amount outstanding under the Loan Documents shall not exceed the Aggregate Commitment. 
 By making
a Loan Request to the Lender hereunder, the Company and the Guarantors shall be deemed to have represented and warranted the accuracy and completeness of the statements set forth in subparagraphs 4(b)(2) through 4(b)(4) above. 
  

	 	5.	Representations and Warranties of the Company. 

 The
Company represents and warrants to the Lender that: 
 5(a) Corporate Existence; Compliance with Law The Company:
(1) is duly organized, validly existing and in good standing as a corporation under the laws of Virginia and is qualified to do business in each other jurisdiction where its ownership of property or conduct of business requires such
qualification and where failure to qualify could have a material adverse effect on the Company or its property or business or on the ability of the Company to pay or perform the Obligations, (2) has the corporate power and authority and the
legal right to own and operate its property and to conduct business in the manner in which it does and proposes so to do, and (3) is in compliance with all Requirements of Law and Contractual Obligations, the failure to comply with which could
have a material adverse effect on the business, operations, assets or financial or other condition of the Company. 
 5(b)
Corporate Power; Authorization; Enforceable Obligations The Company has the corporate power and authority and the legal right to execute, deliver and perform 

  

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the Loan Documents and has taken all necessary corporate action to authorize the execution, delivery and performance of the Loan Documents. The Loan
Documents have been duly executed and delivered on behalf of the Company and constitute legal, valid and binding obligations of the Company enforceable against the Company in accordance with their respective terms, subject to the effect of
applicable bankruptcy and other similar laws affecting the rights of creditors generally and the effect of equitable principles whether applied in an action at law or a suit in equity. 
 5(c) Financial Condition. The financial statements which have been furnished to the Lender, are complete and correct and have been
prepared to present fairly, in accordance with GAAP, the financial condition of the Company and its consolidated Subsidiaries at such dates and the results of its operations and changes in financial position for the fiscal periods then ended.

 5(d) Ownership of Assets. The Company, either directly or through one or more of the Guarantors, is and will be the
sole lawful owner of those hotel assets listed on Schedule III attached hereto (the “Owned Hotels”). The Company, either directly or through one or more of the Guarantors, has full right and title in and to the Owned Hotels,
free and clear of any Lien, security interest, pledge, mortgage, adverse claim or right, charge or encumbrance other than as noted on Schedule III as of the date hereof. There exist no outstanding Liens on any assets or properties of
the Company or any of its Subsidiaries other than those Liens noted on Schedule III as of the date hereof. 
 5(e) Contrary Agreements. Neither the Company nor any of its Subsidiaries has made any agreement which (i) prohibits or restricts the pledging or creation of liens upon the Owned Hotels or (ii) creates a lien on the Owned
Hotels (other than those agreements granting the Liens noted on Schedule III). 
 5(f) No Legal Bar. The
execution, delivery and performance of the Loan Documents, the borrowing hereunder and the use of the proceeds thereof, will not violate any Requirement of Law or any Contractual Obligation of the Company the violation of which could have a material
adverse effect on the business, operations, assets or financial or other condition of the Company and its Subsidiaries, taken as a whole. 
 5(g) Consents, etc. No consent, approval, authorization of, or registration, declaration or filing with, any Governmental Authority is required on the part of the Company in connection with the execution and
delivery of the Loan Documents or the performance of or compliance with the terms, provisions and conditions hereof or thereof. 
 5(h) Investment Company Act. The Company is not an “investment company” or a company “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940, as amended.

 5(i) Federal Reserve Board Regulations. The Company is not engaged, and will not engage, principally or as one of
its important activities, in the business of 

  

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extending credit for the purpose of “purchasing” or “carrying” any “margin stock” within the respective meanings of such terms
under Regulation U. No part of the proceeds of the Loan issued hereunder will be used, directly or indirectly, for “purchasing” or “carrying” “margin stock” as so defined or for any purpose which violates, or which
would be inconsistent with, the provisions of the Regulations of the Board of Governors of the Federal Reserve System. 
 5(j)
Subsidiaries. The attached Schedule II is a complete listing of any and all Subsidiaries of the Company. 
 5(k) Franchise Agreements. To the extent of the Company’s actual control and knowledge, the Company shall, or shall cause its Affiliates to, (i) operate its or their hotels in material compliance with the terms of any
Franchise Agreements in effect as of the date hereof (each, a “Franchise Agreement” and collectively, the “Franchise Agreements”); (ii) promptly perform and observe (or cause to be performed or observed) all of the material
covenants required to be performed and observed by it or them under the Franchise Agreements and do all things necessary to preserve and to keep unimpaired its material rights thereunder; (iii) promptly notify the Lender of any event of default
under the Franchise Agreements of which it or they are aware; and (iv) promptly enforce the performance and observance of all of the covenants required to be performed and observed by the franchisor under the Franchise Agreements. To the extent
of the Company’s actual control and knowledge, without Lender’s prior consent, the Company shall not, shall not permit its Affiliates to, and shall not permit the lessee under any percentage lease or any manager to: (i) surrender,
terminate or cancel any Franchise Agreement; (ii) reduce or consent to the reduction of the term of any Franchise Agreement; (iii) increase or consent to the increase of the amount of any charges under any Franchise Agreement;
(iv) otherwise modify, change, supplement, alter or amend, or waive or release any of its rights and remedies under, any Franchise Agreement or (v) suffer or permit the occurrence of continuance a default beyond any applicable cure period
under any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved by the Lender) if such default permits the franchiser to terminate or cancel any Franchise Agreement (or any successor franchise agreement with
a national hotel chain approved by the Lender). 
 5(l) Equity Offerings. The Company represents and warrants to Lender
that it is a party to an equity-raising agreement with David Lerner Associates, Inc. (“Lerner”) pursuant to which Lerner has solicited (and shall solicit following the closing of the Loan) equity offerings in the Company. 
 5(m) Further Documents. The Company agrees to execute and deliver and to cause to be executed and delivered to the Lender from time
to time such documents, instruments and agreements as the Lender may reasonably require, which are in the Lender’s reasonable judgment necessary to obtain for the Lender the benefit of the Loan Documents. 
  

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 5(n) Indebtedness. Neither the Company nor any of its Subsidiaries are a party to
any Indebtedness other than (i) the Indebtedness evidenced by the Loan Documents, and (ii) the Indebtedness listed on Schedule III hereto. 
 6. Affirmative Covenants. The Company hereby covenants and agrees with the Lender that, as long as any Obligations remain unpaid, the Company shall, and shall cause each of its Subsidiaries to: 
 6(a) Payment of Indebtedness. Pay or otherwise satisfy at or before maturity or before it becomes delinquent or accelerated, as the
case may be, all its Indebtedness (including taxes), except Indebtedness being contested in good faith by appropriate proceedings and for which provision is made to the satisfaction of the Lender for the payment thereof in the event the Company or
any Subsidiary is found to be obligated to pay such Indebtedness and which Indebtedness is thereupon promptly paid by the Company or such Subsidiary. 
 6(b) Maintenance of Existence and Properties. Maintain its corporate existence and obtain and maintain all rights, privileges, licenses, approvals, franchises, properties and assets necessary or desirable in
the normal conduct of its business. 
 6(c) Inspection of Property; Books and Records; Audits. 
 (1) Keep proper books of record and account in which full, true and correct entries in conformity with GAAP and all Requirements of Law
shall be made of all dealings and transactions in relation to its business and activities; and 
 (2) Permit:
(i) representatives of the Lender, to (A) visit and inspect any of its properties and examine and make abstracts from any of its books and records at any reasonable time and as often as may reasonably be desired by the Lender, (but, prior
to the occurrence of an Event of Default, only upon not less than two Business Days’ prior notice), and (B) discuss the business, operations, properties and financial and other condition of the Company and its Subsidiaries with officers
and employees of the Company, and with the independent certified public accountants of the Company, and (ii) representatives of the Lender to conduct periodic operational audits of the business and operations of the Company and its
Subsidiaries. 
 (3) Prepare and deliver to Lender, upon request, for each of its first three (3) fiscal quarters in each
fiscal year, beginning with the fiscal quarter in which closing occurs, on or before the forty-fifth (45th) day
following the end of such fiscal quarter, a copy of its 10Q report as filed with the Securities and Exchange Commission and for each fiscal year, on or before the forty-fifth (45th) day following the
end of such fiscal year, a copy of its 10K report as filed with the Securities and Exchange Commission, in each case certified to be true and correct by the Chief Financial Officer of the Company. 
  

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 6(d) Notices. Promptly give written notice to the Lender of: 
 (1) The occurrence of any Potential Default or Event of Default known to responsible management personnel of the Company and the proposed
method of cure thereof; 
 (2) Any litigation or proceeding affecting the Company or any of its Subsidiaries which could
reasonably be expected to have a material adverse effect on the business, operations, property, or financial or other condition of the Company and its Subsidiaries, taken as a whole; 
 (3) A material adverse change known to responsible management personnel of the Company in the business, operations, property or financial
or other condition of the Company or any Subsidiary; 
 (4) A default under the terms of any Indebtedness to which the Company
or any Subsidiary is a party (whether or not such default gives rise to the right of the affected lender to accelerate such Indebtedness); and 
 (5) Any violation of any Requirements of Law or Contractual Obligations to which the Company or any Subsidiary may be subject or a party. 
 6(e) Expenses and Indemnification. (1) Pay all reasonable out-of-pocket costs and expenses (including fees and disbursements
of legal counsel): (A) of the Lender incident to the preparation, negotiation and administration of the Loan Documents, including with respect to or in connection with any waiver or amendment thereof or thereto, (B) of the Lender
associated with any periodic audits conducted pursuant to Paragraph 6(c)(2)(ii) above, and (C) of the Lender incident to the enforcement of payment of the Obligations, whether by judicial proceedings or otherwise, including, without limitation,
in connection with bankruptcy, insolvency, liquidations reorganization moratorium or other similar proceedings involving the Company or a “workout” of the Obligations. 
 (2) Defend, indemnify and hold harmless the Lender and its parents, Subsidiaries, Affiliates, employees, agents, officers and directors,
from and against any losses, penalties, fines, liabilities, settlements, damages, costs and expenses, suffered by any such Person in connection with any claim (including, without limitation, any environmental claims or civil penalties or fines
assessed by OFAC), investigation, litigation or other proceeding (whether or not the Lender is a party thereto) and the prosecution and defense thereof, arising out of or in any way connected with this Agreement or any other Loan Document or any
advances, or any documents, reports or other information provided to the Lender or contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby, including without limitation reasonable attorney’s and
consultant’s fees, except to the extent that any of the foregoing directly result from the gross negligence or willful misconduct of the Lender. 
  

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 (3) The obligations of the Company under this Paragraph 6(e) shall survive payment of all
other Obligations. 
 6(f) Loan Documents. Comply with and observe all terms and conditions of the Loan Documents
applicable to the Company. 
 6(g) Insurance. Obtain and maintain insurance with responsible companies in such amounts
and against such risks as are usually carried by corporations engaged in similar businesses similarly situated, including, without limitation, errors and omissions coverage and fidelity coverage in form and substance acceptable to the Lender, and
furnish the Lender on request full information as to all such insurance, and to provide within five (5) days after receipt, certificates or other documents evidencing the renewal of each such policy. 
 6(h) Distributions During Default. Upon the occurrence of any Event of Default, and for so long as any such Event of Default in
ongoing, the Company shall make no dividends or distributions to any equity holder. 
 6(i) Immediate Receipt of Equity
Proceeds. Upon receipt of any Equity Proceeds by Lerner or into any escrow account established by Lerner or the Company to hold such Equity Proceeds, and in no event later than three (3) Business Days after the Company is legally entitled
to the use of such Equity Proceeds, then unless the Lender elects, in its sole discretion, to exempt any portion of such Equity Proceeds from the requirements of Paragraph 2(k)(3) upon a request by the Company for any such exemption, it shall make
the Mandatory Equity Payments referred to in Paragraph 2(k)(3), to the extent of Equity Proceeds so available. 
 6(j)
Grant of Lien and Security Interest. Immediately upon an Event of Default under paragraph 8, the Company shall execute and deliver, and shall cause its Subsidiaries to execute and deliver, to the Lender mortgages, deeds or trust or such other
documents as may be necessary or desirable in the reasonable discretion of the Lender to grant and perfect a first priority security interest in each designated property identified on Schedules III and IV (or, in the case of Hotels
subject to permitted Indebtedness as indicated on Schedules III and IV, a second priority security interest to the extent permitted by the documents governing such primary permitted Indebtedness), together with title insurance
policies, copies of title exceptions, flood surveys, property surveys, environmental assessments and any other related real property documentation with respect to each such property, all in form and content reasonably acceptable to the Lender and
all at the expense of the Company. 
 6(k) Compliance With Obligations. Laws and Approvals. Observe and remain in
compliance in all material respects with all Contractual Obligations and Requirements of Law and maintain in full force and effect all governmental approvals, in each case applicable to the conduct of its business. 
  

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 6(l) Acquisition of Acquired Hotels: Reporting. The Company has contracted to
acquire, through one or more of its Subsidiaries, those Hotels listed on Schedule IV hereto (such Hotels, as acquired, the “Acquired Hotels”); provided, that nothing contained herein shall required the Company (or its
Subsidiaries) to acquire all or any of such Hotels. Upon the acquisition by the Company or any Subsidiary of any Acquired Hotel, the Company shall promptly deliver to the Lender such general property information regarding such Acquired Hotel as the
Lender shall reasonably request, such information to include a summary of the acquisition transaction, environmental studies and reports regarding the Acquired Hotel, and such other information as the Lender may reasonably request from time to time.

 6(m) Financial and Other Reporting. Deliver to the Lender, or cause to be delivered to the Lender, (i) within
thirty (30) days after the last day of each calendar month, unaudited consolidated financial statements (balance sheet and income statement) for the Company dated as of the last day of such calendar month for the calendar month then ended,
which financial statements shall present fairly, in accordance with GAAP, the financial condition of the Company and its consolidated Subsidiaries at and as of such date and the results of their operations for the calendar month then ended, which
statements shall be certified to the Lender by the chief financial officer of the Company; and (ii) within five (5) days after the last day of each calendar month, a report from the Company describing the results of Lerner’s
solicitation of equity offerings in the Company, and setting forth the amount of Equity Proceeds raised in such month and the aggregate amount of Equity Proceeds raised during such solicitation. 
 6(n) Joinder of Additional Guarantors. In the event that, prior to the Maturity Date, any Acquired Hotel which is not subject to
permitted Indebtedness listed on Schedule IV shall be acquired by any Subsidiary of the Company (whether now existing or hereafter organized) who is not a Guarantor hereunder, the Company shall cause such acquiring Subsidiary, and shall
additionally cause any Subsidiary of the Company which owns, directly or indirectly, any ownership interest in such acquiring Subsidiary and is not a Guarantor hereunder, to (i) execute and deliver to the Lender a Guaranty in favor of the
Lender whereunder such Subsidiary shall irrevocably and unconditionally guarantee the payment when due, upon maturity, acceleration or otherwise, of the Obligations, and (ii) to execute and deliver, or deliver, to the Lender those documents,
agreements and certificates with respect to such Subsidiary as are listed in subsections (J), (K), (L), (M) and (N) of Paragraph 4(a)(l) above, all at the expense of the Company. In addition, upon request therefor by the Lender, the
Company shall (i) cause its counsel to deliver to the Lender an opinion of counsel for such Subsidiary(ies) in form and substance satisfactory to the Lender and its counsel, and (ii) deliver to the Lender such other information regarding
such Subsidiary(ies) as the Lender may reasonably request, all at the expense of the Company. Upon the execution and delivery by any such Subsidiary of a Guaranty as provided above, such Subsidiary shall be and shall be considered to be a
“Guarantor” for all purposes under the Loan Documents. 
  

 13 

 7. Negative Covenants. The Company hereby agrees that, as long as any Obligations remain unpaid,
the Company shall not at any time, directly or indirectly, and shall not permit any of its Subsidiaries to: 
 7(a)
Consolidation and Merger; Change of Business. Liquidate or dissolve or enter into any consolidation or merger or enter into any partnership, joint venture, syndicate or other combination or make any change in the nature of its business as
presently conducted. 
 7(b) Sale of Assets. Sell, lease, assign, transfer or otherwise dispose of any of its assets
(other than obsolete or worn out property), whether now owned or hereafter acquired, without the prior written consent of Lender. 
 7(c) Additional Indebtedness. Incur any additional Indebtedness, or permit any Subsidiary to incur any additional Indebtedness, on or secured by (including, without limitation, by any Lien, pledge, encumbrance or hypothecation of or
on) any Hotel property owned by the Company or by any Subsidiary, other than that Indebtedness contemplated on Schedules III and IV hereto; provided, that the maximum amount of any such Indebtedness secured by all Hotels shall
not exceed, in the aggregate, the Aggregate Maximum Other Indebtedness Amount. 
 7(d) Embargoed Person. Permit
(1) any of the funds or assets of the Company that are used to repay the Loan to constitute property of, or be beneficially owned directly or, to the Company’s best knowledge, indirectly, by any person subject to sanctions or trade
restrictions under United States law (“Embargoed Person” or “Embargoed Persons”) that are identified on (A) the “List of Specially Designated Nationals and Blocked Persons” maintained by the Office of
Foreign Assets Control (OFAC), U.S. Department of the Treasury, and/or to the Company’s best knowledge, as of the date thereof, based upon reasonable inquiry by the Company, on any other similar list maintained by OFAC pursuant to any
authorizing statute including, but not limited to, the International Emergency Economic Powers Act, 50 U.S.C. §§ 1701 et seq., The Trading with the Enemy Act, 50 U.S.C. App. 1 et seq., and any Executive Order or
regulation promulgated thereunder, with the result that the investment in the Company (whether directly or indirectly), is prohibited by law, or the Loan made by Lender would be in violation of law, or (B) Executive Order 13224 (September 23,
2001) issued by the President of the United States (“Executive Order Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or Support Terrorism”), any related enabling legislation or any other similar
Executive Orders, and (2) any Embargoed Person to have any direct interest, and to the Company’s best knowledge, as of the date hereof, based upon reasonable inquiry by the Company, indirect interest, of any nature whatsoever in the
Company, as applicable, with the result that the investment in the Company (whether directly or indirectly), is prohibited by law or the Loan is in violation of law. 
 7(e) Anti-Money Laundering. Permit any of the funds of the Company, as applicable, that are used to repay the Loan to be derived
from any unlawful activity, with 

  

 14 

 
the result that the investment in the Company or any (whether directly or indirectly), is prohibited by law or the Loan is in violation of law. 

7(f) No Contrary Agreements. The Company shall not make, and shall not permit any of its Subsidiaries to make, any agreement
which (i) prohibits or restricts the pledging or creation of liens upon any Hotel or (ii) creates a lien on any Hotels (other than those agreements evidencing the Indebtedness contemplated on Schedules III and IV).

 8. Events of Default. Upon the occurrence of any of the following events (an “Event of Default”): 
 8(a) The Company shall fail to pay principal or interest on the Loan, or the fee specified in paragraph l(f), in each case, when due; or

 8(b) Any representation or warranty made by the Company or by any Guarantor in any Loan Document or in connection with any
Loan Document shall be false or untrue in any material respect on or as of the date made; or 
 8(c) Glade M. Knight is no
longer serving as Chairman of the Board and CEO of the Company; or 
 8(d) The Company or any Guarantor shall fail to observe
or perform any other term or provision contained in the Loan Documents and such failure shall continue for thirty (30) days; or 
 8(e) The Company or any Guarantor shall default in any payment of principal of or interest on any Indebtedness in the aggregate principal amount of $100,000 or more (and without regard for the dollar amount of the defaulted payment), or any
other event shall occur, the effect of which is to permit such Indebtedness to be declared or otherwise to become due prior to its stated maturity; or 
 8(f) (1) The Company or any Guarantor shall commence any case, proceeding or other action (i) relating to bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an order for relief
entered with respect to the Company or such Guarantor, or seeking to adjudicate the Company or such Guarantor a bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition or other
relief with respect to the Company or its debts or such Guarantor or its debts, or (ii) seeking appointment of a receiver, trustee, custodian or other similar official for the Company or such Guarantor or for all or any substantial part of the
assets of the Company or such Guarantor, or the Company or any Guarantor shall make a general assignment for the benefit of its creditors; or (2) there shall be commenced against the Company or any Guarantor any case, proceeding or other action
of a nature referred to in clause (1) above which (i) results in the entry of an order for relief or any such adjudication or appointment, or (ii) remains undismissed, undischarged or unbonded for a period of sixty (60) days; or
(3) there shall be commenced against the 

  

 15 

 
Company or any Guarantor any case, proceeding or other action seeking issuance of a warrant of attachment, execution, distraint or similar process against
all or substantially all of the assets of either of them which results in the entry of an order for any such relief which shall not have been vacated, discharged, stayed, satisfied or bonded pending appeal within sixty (60) days from the entry
thereof; or (4) the Company or any Guarantor shall take any action in furtherance of, or indicating its consent to, approval of, or acquiescence in (other than in connection with a final settlement), any of the acts set forth in clauses (1),
(2) or (3) above; or (5) the Company or any Guarantor shall generally not, or shall be unable to, or shall admit in writing its inability to pay its debts as they become due; or 
 8(g) One or more judgments or decrees in an aggregate amount in excess of $100,000 shall be entered against the Company or any Guarantor
and all such judgments or decrees shall not have been vacated, discharged, stayed, satisfied or bonded pending appeal within sixty (60) days from the entry thereof; 
 THEN: 
 (1) Automatically upon the occurrence of an Event of Default under Paragraph 8(f)
above; and 
 (2) In all other cases under this Paragraph 8, at the option of the Lender; 
 the principal balance of outstanding Loan and interest accrued but unpaid thereon shall become immediately due and payable, without demand upon or presentment to the
Company, which are expressly waived by the Company. 
 9. Miscellaneous Provisions. 
 9(a) Assignment. The Company may not assign its rights or obligations under this Agreement without the prior written consent of the
Lender. Subject to the foregoing, all provisions contained in this Agreement or any document or agreement referred to herein or relating hereto shall inure to the benefit of the Lender, and its successors and assigns, and shall be binding upon the
Company, and its successors and assigns. 
 9(b) Amendment. Neither this Agreement nor any of the other Loan Documents
may be amended or terms or provisions hereof or thereof waived unless such amendment or waiver is in writing and signed by the Lender and the Company. 
 9(c) Cumulative Rights: No Waiver. The rights, powers and remedies of the Lender under the Loan Documents are cumulative and in addition to all rights, powers and remedies provided under any and all agreements
among the Company and the Lender relating hereto, at law, in equity or otherwise. Any delay or failure by the Lender to exercise any right, power or remedy shall not constitute a waiver thereof by the Lender, and no single or partial exercise by the
Lender of any right, power or remedy shall 

  

 16 

 
preclude other or further exercise thereof or any exercise of any other rights, powers or remedies. 
 9(d) Entire Agreement. This Agreement and the documents and agreements referred to herein embody the entire agreement and
understanding between the parties hereto and supersede all prior agreements and understandings relating to the subject matter hereof and thereof. 
 9(e) Survival. All representations, warranties, covenants and agreements on the part of the Company contained in the Loan Documents shall survive the termination of this Agreement and shall be effective until
the Obligations are paid and performed in full or longer as expressly provided herein. 
 9(f) Notices. All notices
given by any party to the others under the Loan Documents shall be in writing unless otherwise provided for herein, delivered personally or by depositing the same in the United States mail, registered, with postage prepaid, addressed to the party at
the address set forth on Schedule I attached hereto. Any party may change the address to which notices are to be sent by notice of such change to each other party given as provided herein. Such notices shall be effective on the date
received or, if mailed, on the third Business Day following the date mailed. 
 9(g) Governing Law/Waiver of Jury
Trial. This Agreement shall be governed by and construed in accordance with the laws of the State of North Carolina. TO THE EXTENT PERMITTED BY LAW, EACH OF LENDER AND THE COMPANY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY
RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THE LOAN DOCUMENTS. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE LENDER ENTERING INTO THE LOAN DOCUMENTS.

 9(h) Counterparts. This Agreement and the other Loan Documents may be executed in any number of counterparts, all of
which together shall constitute one agreement. 
 9(i) Binding Arbitration. Upon demand of any party hereto, whether
made before or after institution of any judicial proceeding, any dispute, claim or controversy arising out of, connected with or relating to the Note or any other Loan Document (“Disputes”), between or among parties to the Note or any
other Loan Document shall be resolved by binding arbitration as provided herein. Institution of a judicial proceeding by a party does not waive the right of that party to demand arbitration hereunder. Disputes may include, without limitation, tort
claims, counterclaim, claims brought as class actions, claims arising from Loan Documents executed in the future, or claims concerning any aspect of the past, present or future relationships arising out of or connected with the Loan Documents.
Arbitration shall be conducted under and governed by the Commercial Financial Disputes Arbitration Rules (the “Arbitration Rules”) of the 

  

 17 

 
American Arbitration Association and Title 9 of the U.S. Code. All arbitration hearings shall be conducted in Charlotte, North Carolina. The expedited
procedures set forth in Rule 51, et seq. of the Arbitration Rules shall be applicable to claims of less than $1,000,000. All applicable statutes of limitation shall apply to any Dispute. A judgment upon the award may be entered in any
court having jurisdiction. The panel from which all arbitrators are selected shall be comprised of licensed attorneys. The single arbitrator selected for expedited procedure shall be a retired judge from the highest court of general jurisdiction,
state or federal, of the state where the hearing will be conducted. Notwithstanding the foregoing, this paragraph shall not apply to any hedging arrangement that is a Loan Document. 
 10. Definitions. For purposes of this Agreement, the terms set forth below shall have the following meanings: 
 “Acquired Hotels” shall have the meaning set forth in Paragraph 6(l) above. 
 “Affiliate” shall mean, as to any Person, any other Person directly or indirectly controlling, controlled by or under direct or indirect
common control with, such Person. “Control” as used herein means the power to direct the management and policies of such Person. 
 “Aggregate Commitment” shall mean $150,000,000.00, as such amount may be permanently reduced from time to time pursuant to Paragraph 2(k)(3) above. 
 “Aggregate Maximum Other Indebtedness Amount” shall mean the sum of (i) the aggregate maximum amount of indebtedness secured by
liens on Owned Hotels as shown on Schedule III hereto and (ii) the aggregate maximum amount of indebtedness secured by liens on Acquired Hotels as shown on Schedule IV hereto. 
 “Agreement” shall mean this Agreement, as the same may be amended, extended or replaced from time to time. 
 “Applicable LIBOR Rate” shall mean, with respect to a LIBOR Loan, the rate per annum (rounded upward, if necessary, to the next higher
1/32 of one percent (.03125%)) calculated in accordance with the following formula: 
 Applicable LIBOR Rate =
    LR     + LIBOR Spread 
                  1-LRP 
 where: 
 LR = LIBOR Rate; and 
 LRP = LIBOR Reserve Percentage. 
 “Applicable Prime Rate” shall mean the Prime Rate plus the Prime Rate Spread.

  

 18 

 “Business Day” shall mean any day other than a Saturday, a Sunday or a day on which
banks in Charlotte, North Carolina are authorized or obligated to close their regular banking business. 
 “Commitment Fee”
shall have the meaning given such term in Paragraph 1(f) above. 
 “Company” shall have the meaning given such term in
the introductory paragraph hereof. 
 “Contractual Obligation” as to any Person shall mean any provision of any security
issued by such Person or of any agreement, instrument or undertaking to which such Person is a party or by which it or any of its property is bound. 
 “Equity Proceeds” shall mean any and all sums invested in the Company (including dividend reinvestment) on or after the date hereof in the nature of equity including, without limitation, common and
preferred stock (whether or nor convertible into common stock), options or warrants to acquire stock, and subordinated debt (whether or not convertible into stock). 
 “Event of Default” shall have the meaning set forth in Paragraph 8 above. 
 “Franchise Agreement” shall have the meaning set forth in Paragraph 5(k) above. 
 “GAAP” shall
mean generally accepted accounting principles in the United States of America in effect from time to time. 
 “Governmental
Authority” shall mean any nation or government, any state or other political subdivision thereof, or any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government. 

“Guaranties” shall have the meaning set forth in Paragraph 4(a)(l)(C) above. 
 “Guarantors” shall mean, collectively, APPLE SEVEN HOSPITALITY TEXAS, L.P., a Virginia limited partnership, APPLE SEVEN HOSPITALITY
OWNERSHIP, INC., a Virginia corporation, APPLE SEVEN HOSPITALITY SOUTHEAST, L.P., a Virginia limited partnership, SUNBELT-CHM, L.L.C., an Alabama limited liability company, APPLE SEVEN TEXAS GP, INC., a Virginia corporation, APPLE SEVEN TEXAS LP,
INC., a Virginia corporation, APPLE SEVEN SOUTHEAST GP, INC., a Virginia corporation, APPLE SEVEN SOUTHEAST LP, INC., a Virginia corporation, APPLE SEVEN HOSPITALITY, INC., a Virginia corporation, and any other Subsidiary of the Company which may
become a Guarantor hereunder pursuant to Paragraph 6(n) hereof, and “Guarantor” shall mean any of such Persons, as the context may require. 
 “Hotels” shall mean, collectively, the Owned Hotels and the Acquired Hotels. 
 “Indebtedness” of any Person shall mean all items of indebtedness which, in accordance with GAAP and practices thereof, would be included in determining liabilities as shown on the 

  

 19 

 
liability side of a statement of condition of such Person as of the date as of which indebtedness is to be determined, including: without limitation, all
obligations for money borrowed, all amounts for which such Person may be obligated under gestation or other repurchase facilities, and shall also include all indebtedness and liabilities of others assumed or guaranteed by such Person or in respect
of which such Person is secondarily or contingently liable (other than by endorsement of instruments in the course of collection) whether by reason of any agreement to acquire such indebtedness or to supply or advance sums or otherwise. 

“Interest Period” shall mean with respect to the Loan while it is a LIBOR Loan, the period commencing on the date hereof and ending
one month thereafter, and each subsequent one month period thereafter beginning on the date following the last day of the immediately preceding LIBOR Interest Period. 
 “Lender” shall have the meaning given such term in the introductory paragraph hereof. 
 “Lerner” shall have the meaning given such term in Paragraph 5(l) above. 
 “LIBOR Loan” shall
mean the Loan at such time as it is bearing interest at the Applicable LIBOR Rate. 
 “LIBOR Rate” shall mean, with respect
to a LIBOR Loan for any Interest Period, the rate obtained on page 3750 of the Telerate as being the rate at which deposits in immediately available U.S. dollars having a maturity approximately equal to one month are offered to or by reference banks
in the London interbank market, as determined by the Lender at the opening of business on the Business Day which is two (2) Business Days preceding the last day of such Interest Period. 
 “LIBOR Reserve Percentage” shall mean for any day, that percentage expressed as a decimal, which is in effect on such day, as specified
by the Board of Governors of the Federal Reserve System (or any successor) for determining the maximum aggregate reserve requirement (including all basis, supplemental, marginal and other reserves) which is imposed on eurocurrency liabilities.

 “LIBOR Spread” shall mean two percent (2.00%). 
 “Lien” shall mean any security interest, mortgage, pledge, lien, claim on property, charge or encumbrance (including any conditional
sale or other title retention agreement), any lease in the nature thereof, and the filing of or agreement to give any financing statement under the Uniform Commercial Code of any jurisdiction. 
 “Loan” shall have the meaning given such term in Paragraph l(a) above. 
 “Loan Documents” shall mean this Agreement, the Note the Guaranties and each other document, instrument and agreement executed by the
Company or by any Guarantor in connection herewith, as any of the same may be amended, extended or replaced from time to time. 
  

 20 

 “Loan Request” shall mean a request by the Company to the Lender of an Advance under
this Agreement, which Loan Request shall (i) specify the principal amount of the advance so requested and (ii) contain a certification by the Company that the Company is in compliance with the covenant set forth in Paragraph 7(c) above.

 “Mandatory Equity Payments” shall mean have the meaning given such term in Paragraph 2(k)(3) above. 
 “Maturity Date” shall mean December 14, 2007 12 MONTHS FROM CLOSING as such date may be extended from time to time in writing by the
Lender, in its sole discretion. 
 “Note” shall mean have the meaning given such term in Paragraph 2(b) hereof. 

“Obligations” shall mean any and all debts, obligations and liabilities of the Company to the Lender (whether now existing or
hereafter arising, voluntary or involuntary, whether or not jointly owed with others, direct or indirect, absolute or contingent, liquidated or unliquidated, and whether or not from time to time decreased or extinguished and later increased, created
or incurred), arising out of or related to the Loan Documents. 
 “Owned Hotels” shall have the meaning set forth in
Paragraph 5(d) above. 
 “Person” shall mean any corporation, natural person, firm, joint venture, partnerships, trust,
unincorporated organization or Governmental Authority. 
 “Potential Default” shall mean an event which but for the lapse of
time or the giving of notice, or both, would constitute an Event of Default. 
 “Prime Rate” shall mean a rate per annum
equal to the rate announced from time to time by the Lender to be its “Prime Rate” as such “Prime Rate” may change from time to time, said changes to occur on the first date the “Prime Rate” changes; it being understood
that the “Prime Rate” is the rate announced by the Lender from time to time as its “Prime Rate” and is not necessarily the lowest interest rate charged by the Lender to its customers. 
 “Prime Rate Loan” shall mean the Loan at such time as it is bearing interest at the Applicable Prime Rate. 
 “Prime Rate Spread” shall mean one percent (1.00%). 
 “Requirements of Law” shall mean, as to any Person, the Articles or Certificate of Incorporation and Bylaws or other organizational or governing documents of such Person, and any law, treaty, rule or
regulation, or a final and binding determination of an arbitrator or a determination of a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its
property is subject. 
  

 21 

 “Subsidiary” shall mean any corporation, partnership, limited liability company or joint
venture more than fifty percent (50%) of the stock or other ownership interest of which having by the terms thereof ordinary voting power to elect the board of directors, managers or trustees of such corporation, partnership or joint venture
(irrespective of whether or not at the time stock of any other class or classes of such corporation, partnership or joint venture shall have or might have voting power by reason of the happening of any contingency) shall, at the time as of which any
determination is being made, be owned, either directly or through Subsidiaries. 
 [SIGNATURES ON NEXT PAGE] 
  

 22 

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

			
	 APPLE REIT SEVEN, INC.,
 a Virginia
corporation

		
	By:	 	/s/ David Bucklay
	Name:	 	David Bucklay
	Title	 	SVP
	
	 WACHOVIA BANK, NATIONAL ASSOCIATION,
 a
national banking association

		
	By:	 	  
	Name:	 	  
	Title:	 	  

  

 23 

 LIST OF SCHEDULES AND EXHIBITS 
  

			
	Schedule I	  	Addresses
		
	Schedule II	  	Subsidiaries
		
	Schedule III	  	Owned Hotels/Existing Indebtedness/Existing Liens
		
	Schedule IV	  	Acquired Hotels/Indebtedness to be Assumed/Liens to be Permitted
		
	Exhibit A	  	Form of Promissory Note
		
	Exhibit B	  	Form of Guaranty

 SCHEDULE I 
 ADDRESSES 
  

			
	 LENDER
	  	 COMPANY

	Wachovia Bank, National Association	  	Apple REIT Seven, Inc.
	One Wachovia Center, 16th Floor	  	814 E. Main Street
	301 South College Street	  	Richmond, Virginia 23219
	Charlotte, North Carolina 28288-0172	  	Attention: David McKenney
	Attention: Chris Troutman	  	Telephone No.: (804) 344-8121
	Telephone No.: (704) 715-6161	  	Telecopy No.: (804) 344-8129
	Telecopy No.: (704)715-0059	  	

 SCHEDULE II 
 SUBSIDIARIES 
 Subsidiaries of Apple REIT Seven, Inc. 
 (The state of incorporation or organization of 
 each subsidiary is Virginia, except as
noted) 
 [ATTACH CHART SUPPLIED BY COMPANY] 

 SCHEDULE III 
 Owned Hotels/Existing Indebtedness/Existing Liens 
  

									
	 HOTEL LOCATION
	  	 TYPE OF HOTEL
	  	 OWNER
	  	IDENTITY OF
LENDER
HOLDING
LIEN ON
PROPERTY	  	MAXIMUM
AMOUNT OF
DEBT
ENCUMBERING
PROPERTY
	Houston (Midway) TX	  	Residence Inn by Marriott	  	Apple Seven Hospitality Texas, L.P.	  	N/A	  	N/A
	Rancho Bernardo CA	  	Hilton Garden Inn	  	Apple Seven Hospitality Ownership, Inc.	  	N/A	  	N/A
	Brownsville TX	  	Courtyard by Marriott	  	Apple Seven Hospitality Texas, L.P.	  	N/A	  	N/A
	Stafford TX	  	Homewood Suites	  	Apple Seven Hospitality Texas, L.P.	  	N/A	  	N/A
	Auburn AL	  	Hilton Garden Inn	  	Apple Seven Hospitality Southeast, L.P.	  	N/A	  	N/A
	Montgomery AL	  	Hilton Garden Inn	  	Apple Seven Hospitality Southeast, L.P.	  	N/A	  	N/A
	Troy AL	  	Hampton Inn	  	Apple Seven Hospitality Southeast, L.P.	  	N/A	  	N/A
	Montgomery AL	  	Homewood Suites	  	Apple Seven Hospitality Southeast, L.P.	  	N/A	  	N/A
	Huntsville AL	  	Hilton Garden Inn	  	Apple Seven Hospitality Southeast, L.P.	  	N/A	  	N/A
	Lake Union WA	  	Residence Inn	  	Apple Seven Hospitality Ownership, Inc	  	N/A	  	N/A
	Sarasota FL	  	Homewood Suites	  	Apple Seven Hospitality Ownership, Inc.	  	N/A	  	N/A
	Hattiesburg MS	  	Courtyard by Marriott	  	Sunbelt-CHM. L.L.C.	  	N/A	  	N/A
	Huntsville AL	  	Homewood Suites	  	Apple Seven Hospitality Southeast, L.P.	  	N/A	  	N/A
	Omaha NE	  	Courtyard by Marriott	  	Apple Seven SPE Omaha CY, Inc.	  	Capmark	  	$13,250,000

 Aggregate maximum amount of indebtedness secured by liens on Owned Hotels: $13,250,000 
  

 2 

 SCHEDULE IV 
 Acquired Hotels/Indebtedness to be Incurred/Liens to be Permitted 
  

									
	 HOTEL LOCATION
	 	 TYPE OF HOTEL
	 	 OWNER
	 	IDENTITY OF
LENDER
HOLDING
LIEN ON
PROPERTY	 	MAXIMUM
AMOUNT OF
DEBT
ENCUMBERING
PROPERTY
	Cincinnati (Milford) OH	 	Homewood Suites	 	Apple Seven Hospitality Ownership, Inc.	 	N/A	 	N/A
	Tupelo MS	 	Hampton Inn	 	A7 SPE Tupelo HI, L.P.	 	Wachovia	 	$4,100,000
	Newark NJ	 	Springhill Suites by Marriott	 	Apple Seven Hospitality Ownership, Inc.	 	N/A	 	N/A
	Danbury CT	 	Hilton Garden Inn	 	Apple Seven Hospitality Ownership, Inc.	 	N/A	 	N/A
	Islip (MacArthur Airport) NY	 	Hilton Garden Inn	 	Apple Seven Hospitality Ownership, Inc.	 	N/A	 	N/A
	Jacksonville FL	 	Homewood Suites	 	[to-be-formed SPE]	 	Capmark	 	$10,752,792
	New Orleans LA	 	Homewood Suites	 	[to-be-formed SPE]	 	Capmark	 	$16,485,789
	Rancho Bernardo CA	 	Courtyard by Marriott	 	Apple Seven Hospitality Ownership, Inc.	 	N/A	 	N/A
	Savannah GA	 	Homewood Suites	 	[to-be-formed SPE]	 	Capmark	 	$8,628,593
	Agoura Hills CA	 	Homewood Suites	 	Apple Seven Hospitality Ownership, Inc.	 	N/A	 	N/A
	Highlands Ranch CO	 	Hilton Garden Inn	 	Apple Seven Hospitality Ownership, Inc.	 	N/A	 	N/A
	Corpus Christi TX	 	Courtyard by Marriott	 	Apple Seven Hospitality Texas, L.P.	 	N/A	 	N/A
	Highlands Ranch CO	 	Residence Inn by Marriott	 	[to-be-formed SPE]	 	Capmark	 	$11,550,000
	Cranford NJ	 	Homewood Suites	 	Apple Seven Hospitality Ownership, Inc.	 	N/A	 	N/A
	Mahwah NJ	 	Homewood Suites	 	Apple Seven Hospitality Ownership, Inc.	 	N/A	 	N/A
	San Diego (Airport) CA	 	Hampton Inn	 	[to-be-formed SPE]	 	Lehman	 	$16,357,824
	Miami (Blue Lagoon) FL	 	Homewood Suites	 	[to-be-formed SPE]	 	Capmark	 	$9,899,844
	Vancouver BC Canada	 	Springhill Suites by Marriott	 	Apple Seven Hospitality Ownership, Inc.	 	N/A	 	N/A
	Prattville AL	 	Courtyard by Marriott	 	Sunbelt-CPA, L.L.C.	 	N/A	 	N/A
	San Diego (Downtown) CA	 	Residence Inn by Marriott	 	[to-be-formed SPE]	 	Bear Stearns	 	$16,051,139
	Provo UT	 	Residence Inn by Marriott	 	[to-be-formed SPE]	 	Bear Stearns	 	$5,639,590
	Macon GA	 	Hilton Garden Inn	 	Apple Seven Hospitality Southeast, L.P.	 	N/A	 	N/A
	Miami (Dolphin Mall) FL	 	Courtyard by Marriott	 	Apple Seven Hospitality Ownership, Inc.	 	N/A	 	N/A
	Trussville AL	 	Courtyard by Marriott	 	Sunbelt-CTA, L.L.C.	 	N/A	 	N/A
	Tucson AZ	 	Residence Inn by Marriott	 	Apple Seven Hospitality Ownership, Inc.	 	N/A	 	N/A
	El Paso TX	 	Homewood Suites	 	Apple Seven Hospitality Texas, L.P.	 	N/A	 	N/A
	San Antonio (Airport) TX	 	TownePlace Suites by Marriott	 	Apple Seven Hospitality Texas, L.P.	 	N/A	 	N/A
	San Antonio (USAA) TX	 	TownePlace Suites by Marriott	 	Apple Seven Hospitality Texas, L.P.	 	N/A	 	N/A

 Aggregate maximum amount of indebtedness secured by liens on Acquired Hotels: $99,465,571 

 PROMISSORY NOTE 
 December 14, 2006 
 FOR VALUE RECEIVED, APPLE REIT SEVEN, INC., a Virginia corporation the
“Company”) hereby unconditionally promises to pay to the order of WACHOVIA BANK, NATIONAL ASSOCIATION, a national banking association (the “Lender”), at the office of WACHOVIA BANK, located at One Wachovia Center, TW-16, 301
South College Street, Charlotte, North Carolina 28288-0172, in lawful money of the United States and in immediately available funds, on the dates required under that certain Loan Agreement of even date herewith by and between the Company and the
Lender (as the same may be amended, extended or replaced from time to time, the “Agreement” and with the capitalized terms not otherwise defined herein used with the meanings given such terms in the Agreement), the sum of $150,000,000.00,
the maximum outstanding principal amount of the Loan made under the Agreement, or such lesser amount as has been actually disbursed to the Company by the Lender from time to time pursuant to the Agreement. 
 The Company further agrees to pay interest in like money and funds at the office of the Lender referred to above, on the unpaid principal balance hereof
from the date advanced until paid in full on the dates and at the applicable rates set forth in the Agreement. The holder of this Note is hereby authorized to record the date and amount of each payment of principal and interest, and applicable
interest rates and other information with respect thereto, on the schedules annexed to and constituting a part of this Note (or by any analogous method the holder hereof may elect consistent with its customary practices) and any such recordation
shall, absent manifest error, constitute prima facie evidence of the accuracy of the information so recorded; provided, however, that the failure to make a notation or the inaccuracy of any notation shall not limit or otherwise affect
the obligations of the Company under the Note, the Agreement or any other documents which may evidence or govern this indebtedness. 
 This
Note is the Note referred to in, and is entitled to all the benefits of, the Agreement. Reference is hereby made to the Agreement for rights and obligations of payment and prepayment, Events of Default and the rights of acceleration of the maturity
hereof upon the occurrence of an Event of Default. 

 This Note shall be governed by, and construed in accordance with, the laws of the State of North
Carolina, and is being executed by the duly authorized officers of the Company as of the day and year first above written. 
  

			
	 APPLE REIT SEVEN, INC.,
 a Virginia
corporation

		
	By:	 	/s/ David Bucklay
	Name:	 	David Bucklay
	Title:	 	SVP

  

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 EXHIBIT B 
 FORM OF GUARANTY 

 GUARANTY 
 THIS GUARANTY (the “Guaranty”) is made and dated as of the 14th day of
December, 2006 by APPLE SEVEN HOSPITALITY, INC., a Virginia corporation (“Guarantor”). 
 RECITALS 
 A. Pursuant to that certain Loan Agreement of even date herewith between Apple REIT Seven, Inc. (the “Company”) and Wachovia Bank, National
Association (the “Lender”), (as amended, extended and replaced from time to time, the “Loan Agreement,” and with capitalized terms not otherwise defined herein used with the same meanings as in the Loan Agreement) the Lender has
agreed to extend credit to the Company, on the terms and subject to the conditions set forth therein. 
 B. As a condition precedent to the
effectiveness of the Loan Documents and pursuant to the terms of and as specifically required as a condition to the effectiveness of the Loan Agreement, Guarantor is required to execute and deliver to the Lender this Guaranty. 
 C. Guarantor is a wholly-owned subsidiary of the Company, and thus will derive material benefit from the extension of credit by the Lender to the Company
pursuant to the Loan Agreement. 
 NOW, THEREFORE, in consideration of the above Recitals and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, Guarantor hereby agrees as follows: 
 AGREEMENT 
 1. (a) Guarantor hereby irrevocably and unconditionally guarantees the payment when due, upon maturity, acceleration or otherwise, of the
Obligations, whether heretofore, now, or hereafter made, incurred or created, whether voluntary or involuntary and however arising, absolute or contingent, liquidated or unliquidated, determined or undetermined, whether or not such Obligations are
from time to time reduced, or extinguished and thereafter increased or incurred, whether Company may be liable individually or jointly with others, whether or not recovery upon such Obligations may be or hereafter become barred by any statute of
limitations, and whether or not such Obligations may be or hereafter become otherwise invalid or unenforceable. This Guaranty is a guaranty of payment and not of collection. 
 (b) Notwithstanding anything to the contrary contained in subsection (a) above, it is the intention of Guarantor and Lender that, in
any proceeding involving the bankruptcy, reorganization, arrangement, adjustment of debts, relief of debtors, dissolution or insolvency or any similar proceeding with respect to Guarantor or its assets, the amount of Guarantor’s obligations
under this Guaranty shall be in, but not in excess of, the maximum amount thereof not subject to avoidance or recovery by operation of all applicable laws 

 
governing bankruptcy, reorganization, arrangement, adjustment of debts, relief of debtors, dissolution, insolvency, fraudulent transfers or conveyances or
other similar laws (including, without limitation, 11 U.S.C. Sections 547, 548 and 550 and other “avoidance” provisions of Title 11 of the United States Code) (“Applicable Insolvency Laws”) after giving effect to subsection
(c) below. To that end, but only in the event and to the extent that after giving effect to subsection (c) below Guarantor’s obligations under this Guaranty or any payment made pursuant hereto would, but for the operation of the first
sentence of this subsection (b), be subject to avoidance or recovery in any such proceeding under Applicable Insolvency Laws after giving effect to subsection (c) below, the amount of Guarantor’s obligations under this Guaranty shall be
limited to the largest amount which, after giving effect thereto, would not, under Applicable Insolvency Laws, render Guarantor’s obligations under this Guaranty unenforceable or avoidable or otherwise subject to recovery under Applicable
Insolvency Laws. To the extent any payment actually made by Guarantor pursuant to this Guaranty exceeds the limitation of the first sentence of this subsection (b) and is otherwise subject to avoidance and recovery in any such proceeding under
Applicable Insolvency Laws, the amount subject to avoidance shall in all events be limited to the amount by which such actual payment exceeds such limitation and the obligations of Guarantor hereunder, as limited by the first sentence of this
subsection (b), shall in all events remain in full force and effect and be fully enforceable against Guarantor. The first sentence of this subsection (b) is intended solely to preserve the rights of Lender hereunder against Guarantor in such
proceeding to the maximum extent permitted by Applicable Insolvency Laws and neither Guarantor, Company, any other guarantor nor any other Person shall have any right or claim under such sentence that would not otherwise be available under
Applicable Insolvency Laws in such proceeding. 
 (c) (i) To the extent Guarantor is required, by reason of its
obligations hereunder, to pay to Lender an amount greater than the amount of value (as determined in accordance with Applicable Insolvency Laws) actually made available to or for the benefit of Guarantor on account of the Loan Agreement, this
Guaranty or any other Loan Document, Guarantor shall have an enforceable right of contribution against Company, and Company shall be liable for repayment of the full amount of such excess payment. Subject only to the subordination provided in the
following clause (ii), Guarantor further shall be subrogated to any and all rights of Lender against Company to the extent of such excess payment. 
 (ii) Notwithstanding any payment or payments by Guarantor hereunder, or any set-off or application of funds of Guarantor by Lender, or the receipt of any amounts by Lender with respect to any of the obligations of
Guarantor hereunder, Guarantor shall not be entitled to be subrogated to any of the rights of Lender against Company or any other guarantors or against any collateral security, if any, held by or for the benefit of Lender for the payment of the
Obligations nor shall Guarantor seek any reimbursement from Company in respect of payments made by Guarantor in connection with the obligations of Guarantor hereunder, until all amounts owing to Lender on account of the Obligations are paid in full
and the Aggregate Commitment is terminated. If any amount shall be paid to Guarantor on account of such subrogation rights at any time when all of the Obligations shall not have been paid in full, such amount shall be held by Guarantor in trust for
Lender, segregated from other funds of Guarantor, and shall, forthwith upon receipt by Guarantor, be turned over to Lender in the exact form received by Guarantor (duly endorsed by Guarantor to Lender, if required) to be applied 

  

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against the Obligations, whether matured or unmatured, in such order as set forth in the Loan Agreement. 
 2. Guarantor irrevocably and unconditionally guarantees the payment of the Obligations whether or not due or payable by Company upon: (a) the
dissolution, insolvency or business failure of, or any assignment for benefit of creditors by, or commencement of any bankruptcy, reorganization, arrangement, moratorium or other debtor relief proceedings by or against, Company or Guarantor, or
(b) the appointment of a receiver for, or the attachment, restraint of or making or levying of any order of court or legal process affecting, the property of Company or Guarantor, and unconditionally promises to pay such Obligations to Lender,
or order, on demand, in lawful money of the United States. 
 3. The liability of Guarantor hereunder is exclusive and independent of any
security for or other guaranty of the Obligations, whether executed by Guarantor or by any other party, and the liability of Guarantor hereunder is not affected or impaired by (a) any direction of application of payment by Company or by any
other party, or (b) any other guaranty, undertaking or maximum liability of Guarantor or of any other party as to the Obligations, or (c) any payment on or in reduction of any such other guaranty or undertaking, or (d) any revocation
or release of any obligations of any other guarantor of the guaranteed Obligations, or (e) any payment made to Lender on the Obligations which any of such Persons repay to Company pursuant to court order in any bankruptcy, reorganization,
arrangement, moratorium or other debtor relief proceeding, and Guarantor waives any right to the deferral or modification of Guarantor’s obligations hereunder by reason of any such proceeding. 
 4. (a) The obligations of Guarantor hereunder are independent of the Obligations of Company, and a separate action or actions may be brought and
prosecuted against Guarantor whether or not action is brought against Company and whether or not Company be joined in any such action or actions. Guarantor waives, to the fullest extent permitted by law, the benefit of any statute of limitations
affecting its liability hereunder or the enforcement thereof. Any payment by Company or other circumstance which operates to toll any statute of limitations as to Company shall operate to toll the statute of limitations as to Guarantor. 

(b) All payments made by Guarantor under this Guaranty shall be made without set-off or counterclaim and free and clear of and without
deductions for any present or future taxes, fees, charges, withholdings or conditions of any nature (“Taxes”). Guarantor shall pay any such Taxes, including Taxes on any amounts so paid, and will promptly furnish Lender with copies of any
tax receipts or such other evidence of payment as Lender may require. However, Guarantor shall not be liable for any income tax liability arising under the Loan. 
 5. Guarantor authorizes Lender (whether or not after termination of this Guaranty), without notice or demand (except as shall be required by applicable statute and cannot be waived), and without affecting or impairing
its liability hereunder, from time to time to (a) renew, compromise, extend, increase, accelerate or otherwise change the time for payment of, or otherwise change the terms of, the Obligations or any part thereof, including increase or decrease
of the rate of interest thereon; (b) take and hold security for the payment of this Guaranty or the Obligations and exchange, enforce, waive and release any such security; (c) apply such security 

  

 3 

 
and direct the order or manner of sale thereof as Lender, in its discretion may determine; and (d) release or substitute any one or more endorsers,
guarantors, Company or other obligors. Lender may without notice to or the further consent of Company or Guarantor assign this Guaranty in whole or in part to any person acquiring an interest in the Obligations. 
 6. It is not necessary for Lender to inquire into the capacity or power of Company or the officers acting or purporting to act on its behalf, and
Obligations made or created in reliance upon the professed exercise of such powers shall be guaranteed hereunder. 
 7. Guarantor waives any
right to require Lender to (a) proceed against Company or any other party; (b) proceed against or exhaust any security held from Company; or (c) pursue any other remedy in Lender’s power whatsoever. To this end, and without
limiting the generality of the foregoing, Guarantor expressly waives any rights Guarantor might otherwise have had under the provisions of North Carolina General Statutes §26-7 et seq. Guarantor waives any personal defense based on or
arising out of any personal defense of Company other than payment in full of the Obligations, including, without limitation, any defense based on or arising out of the disability of Company, or the invalidity or unenforceability of the Obligations
or any part thereof from any cause, or the cessation from any cause of the liability of Company other than payment in full of the Obligations. Lender may, at its election, foreclose on any security held for the guaranteed Obligations by one or more
judicial or nonjudicial sales, or exercise any other right or remedy Lender may have against Company, or any security, without affecting or impairing in any way the liability of Guarantor hereunder except to the extent the Obligations have been
paid. Guarantor waives any defense arising out of any such election, even though such election operates to impair or extinguish any right of reimbursement or subrogation or other right or remedy of Guarantor against Company or any security.
Guarantor hereby waives, until such time as all of its obligations under this Guaranty have been performed, discharged or terminated, and all Obligations under the Loan have been performed, discharged or terminated, any claim or other rights which
Guarantor may now have or may hereafter acquire against the Company or any other guarantor of all or any of the guaranteed Obligations that arise from the existence or performance of Guarantor’s obligations under this Guaranty or any other of
the Loan Documents (as such claims and rights being referred to as the “Guarantor’s Conditional Rights”), including, without limitation, any right of subrogation, reimbursement, exoneration, contribution, or indemnification, or any
right to participate in any claim or remedy which the Lender has against the Company or any collateral which the Lender now has or hereafter acquire for the Obligations, whether or not such claim, remedy or right arises in equity or under contract,
statute or common law, by any payment made hereunder or otherwise, including, without limitation, the right to take or receive from the Company, directly or indirectly, in cash or other property or setoff or in any other manner, payment or security
on account of such claim or other rights. If, notwithstanding the foregoing provisions, any amount shall be paid to Guarantor on account of Guarantor’s Conditional Rights and either (a) such amount is paid to Guarantor at any time when the
Obligations shall not have been paid or performed in full, or (b) regardless of when such amount is paid to Guarantor any payment made by Company to the Lender is at any time determined to be a preferential payment, then such amount paid to
Guarantor shall be deemed to be held in trust for the benefit of the Lender and shall forthwith be paid to the Lender to be credited and applied upon the Obligations, whether matured or unmatured, in such order and manner as the Lender shall
determine. To the extent that any of the provisions of this 

  

 4 

 
Paragraph shall not be enforceable, Guarantor agrees that until such time as the Obligations have been paid and performed in full and the period of time has
expired during which any payment made by the Company or Guarantor to the Lender may be determined to be a preferential payment, Guarantor’s Conditional Rights to the extent not validly waived shall be subordinate to the Lender’s right to
full payment and performance of the Obligations and Guarantor shall not seek to enforce Guarantor’s Conditional Rights during such period. Guarantor waives all presentments, demands for performance, protests and notices, including, without
limitation, notices of nonperformance, notices of protest, notices of dishonor, notices of acceptance of this Guaranty, and notices of the existence, creation or incurring of new or additional Obligations. Guarantor assumes all responsibility for
being and keeping itself informed of Company’s financial condition and assets, and of all other circumstances bearing upon the risk of nonpayment of the Obligations and the nature, scope and extent of the risks which Guarantor assumes and
incurs hereunder, and agrees that Lender shall have no duty to advise Guarantor of information known to any of them regarding such circumstances or risks. 
 8. In addition to the Obligations, Guarantor agrees to pay reasonable attorneys’ fees and all other costs and expenses incurred by Lender in enforcing this Guaranty in any action or proceeding arising out of, or
relating to, this Guaranty. This Guaranty and the liability and obligations of Guarantor hereunder are binding upon Guarantor and its successors and assigns, and this Guaranty inures to the benefit of and is enforceable by Lender and its successors,
transferees, and assigns. 
 9. No right or power of Lender hereunder shall be deemed to have been waived by any act or conduct on the part
of the Lender, or by any neglect to exercise such right or power, or by any delay in so doing; and every right or power shall continue in full force and effect until specifically waived or released by an instrument in writing executed by Lender.

 10. Guarantor agrees to execute any and all further documents, instruments and agreements as Lender from time to time reasonably requests
to evidence Guarantor’s obligations hereunder. 
 11. Guarantor hereby represents and warrants and agrees that: 
 (a) Guarantor: (1) is duly organized, validly existing and in good standing as a corporation under the laws of the Commonwealth of
Virginia and is qualified to do business in each other jurisdiction where its ownership of property or conduct of business requires such qualification and where failure to qualify could have a material adverse effect on Guarantor or its property or
business or on Guarantor’s ability to pay or perform its obligations hereunder, (2) has the corporate power and authority and the legal right to own and operate its property and to conduct business in the manner in which it does and
proposes to do so, (3) is in compliance with all Requirements of Law and Contractual Obligations to the extent that failure to so comply could have a material adverse effect on Guarantor or the Company or any of their respective property or
business or on the ability of Company to pay or perform the Obligations or the ability of Guarantor to pay or perform Guarantor’s obligations hereunder, and (4) has reviewed and approved the Loan Documents. 
  

 5 

 (b) Guarantor has the corporate power and authority and the legal right to execute,
deliver and perform the Loan Documents to which it is a party and has taken all necessary corporate action to authorize the execution, delivery and performance of this Guaranty. The Loan Documents to which Guarantor is a party have been duly
executed and delivered on behalf of Guarantor and constitute legal, valid and binding obligations of Guarantor enforceable against Guarantor in accordance with their respective terms, subject to the effect of applicable bankruptcy and other similar
laws affecting the rights of creditors generally and the effect of equitable principles whether applied in an action at law or a suit in equity. 
 (c) Guarantor has not made, and will not make, any agreement which (i) prohibits or restricts the pledging or creation of lien upon the Owned Hotels, if any, which Guarantor owns or (ii) creates a lien on
the Owned Hotels, if any, which Guarantor owns (other than those agreements granting the Liens noted on Schedules III and IV to the Loan Agreement). 
 (d) The execution, delivery and performance of this Guaranty will not violate any Requirement of Law or any Contractual Obligations of
Guarantor the violation of which could have a material adverse effect on the business, operations, assets or financial or other condition of Guarantor. 
 (e) Guarantor is not an “investment company” or a company “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940, as amended. 
 (f) Neither Guarantor nor any of the Subsidiaries of Guarantor, if any, is engaged or will engage, principally or as one of its important
activities, in the business of extending credit for the purpose of “purchasing” or “carrying” any “margin stock” within the respective meanings of such terms under Regulation U. No part of the proceeds of any Loan made
under the Loan Agreement will be used, directly or indirectly, for “purchasing” or “carrying” “margin stock” as so defined or for any purpose which violates, or which would be inconsistent with, the applicable
provisions of the Regulations of the Board of Governors of the Federal Reserve System. 
 (g) No consent, approval,
authorization of, or registration, declaration or filing with, any Governmental Authority is required on the part of Guarantor in connection with the execution and delivery of the Loan Documents to which Guarantor is a party or the performance of or
compliance with the terms, provisions and conditions hereof or thereof. 
 (h) To the extent of Guarantor’s actual
control and knowledge, Guarantor shall (i) operate its hotels, if any, in material compliance with the terms of any Franchise Agreements in effect as of the date hereof; (ii) promptly perform and observe (or cause to be performed or
observed) all of the material covenants required to be performed and observed by it under the Franchise Agreements and do all things necessary to preserve and to keep unimpaired its material rights thereunder; (iii) promptly notify Lender of
any 

  

 6 

 
event of default under the Franchise Agreements of which it is aware; and (iv) promptly enforce the performance and observance of all of the covenants
required to be performed and observed by the franchisor under the Franchise Agreements. To the extent of Guarantor’s actual control and knowledge, without Lender’s prior consent, Guarantor shall not, and shall not permit the lessee under
any percentage lease or any manager to: (i) surrender, terminate or cancel any Franchise Agreement; (ii) reduce or consent to the reduction of the term of any Franchise Agreement; (iii) increase or consent to the increase of the
amount of any charges under any Franchise Agreement; (iv) otherwise modify, change, supplement, alter or amend, or waive or release any of its rights and remedies under, any Franchise Agreement or (v) suffer or permit the occurrence of
continuance a default beyond any applicable cure period under any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved by Lender) if such default permits the franchiser to terminate or cancel any Franchise
Agreement (or any successor franchise agreement with a national hotel chain approved by Lender). 
 (i) Guarantor is not and
shall not be a party to any Indebtedness other than (i) the Indebtedness evidenced by this Guaranty and (ii) the Indebtedness listed on Schedule III to the Credit Agreement, and Guarantor shall not incur any additional
Indebtedness on or secured by (including, without limitation, by any Lien, pledge, encumbrance or hypothecation of or on) any Hotel property owned by Guarantor, other than that Indebtedness contemplated on Schedules III and
IV of the Loan Agreement. 
 (j) Guarantor shall maintain its corporate existence and obtain and maintain all
rights, privileges, licenses, approvals, franchises, properties and assets necessary or desirable in the normal conduct of its business, and comply with all Contractual Obligations and Requirements of Law, in each case applicable to the conduct of
its business, except where the failure to so comply is not likely to have a material adverse effect on the business, operations, assets or financial or other condition of Guarantor. 
 (k) Guarantor shall pay or otherwise satisfy at or before maturity or before it becomes delinquent or accelerated, as the case may be, all
its Indebtedness (including taxes), except Indebtedness being contested in good faith by appropriate proceedings and for which provision is made to the satisfaction of Lender for the payment thereof in the event Guarantor is found to be obligated to
pay such Indebtedness and which Indebtedness is thereupon promptly paid by Guarantor. 
 (l)Guarantor shall keep proper books
of record and account in which full, true and correct entries in conformity with GAAP and all Requirements of Law shall be made of all dealings and transactions in relation to its business and activities. 
 (m) Guarantor shall not sell, lease, assign, transfer or otherwise dispose of any of its assets (other than obsolete or worn out
property), whether now owned or hereafter acquired, other than in the ordinary course of business and at fair market value, without the prior written consent of Lender. 
  

 7 

 12. This Guaranty shall be deemed to be made under and shall be governed by the laws of the State of
North Carolina. 
 13. If any of the provisions of this Guaranty shall contravene or be held invalid under the laws of any jurisdiction, this
Guaranty shall be construed as if not containing those provisions and the rights and obligations of the parties hereto shall be construed and enforced accordingly. 
 [SIGNATURE ON NEXT PAGE] 
  

 8 

 Executed and sealed as of the day and year first above written. 
  

			
	APPLE SEVEN HOSPITALITY, INC., a Virginia corporation
		
	By:	 	/s/ Justin G. Knight
	Name:	 	Justin G. Knight
	Title:	 	President

 GUARANTY 
 THIS GUARANTY (the “Guaranty”) is made and dated as of the 14th day of
December, 2006 by APPLE SEVEN HOSPITALITY OWNERSHIP, INC., a Virginia corporation (“Guarantor”). 
 RECITALS 
 A. Pursuant to that certain Loan Agreement of even date herewith between Apple REIT Seven, Inc. (the “Company”) and Wachovia Bank, National
Association (the “Lender”), (as amended, extended and replaced from time to time, the “Loan Agreement,” and with capitalized terms not otherwise defined herein used with the same meanings as in the Loan Agreement) the Lender has
agreed to extend credit to the Company, on the terms and subject to the conditions set forth therein. 
 B. As a condition precedent to the
effectiveness of the Loan Documents and pursuant to the terms of and as specifically required as a condition to the effectiveness of the Loan Agreement, Guarantor is required to execute and deliver to the Lender this Guaranty. 
 C. Guarantor is wholly-owned by Apple Seven Hospitality, Inc., which is a wholly-owned subsidiary of the Company, and thus will derive material benefit
from the extension of credit by the Lender to the Company pursuant to the Loan Agreement. 
 NOW, THEREFORE, in consideration of the above
Recitals and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, Guarantor hereby agrees as follows: 
 AGREEMENT 
 1. (a) Guarantor hereby irrevocably and unconditionally guarantees the payment when
due, upon maturity, acceleration or otherwise, of the Obligations, whether heretofore, now, or hereafter made, incurred or created, whether voluntary or involuntary and however arising, absolute or contingent, liquidated or unliquidated, determined
or undetermined, whether or not such Obligations are from time to time reduced, or extinguished and thereafter increased or incurred, whether Company may be liable individually or jointly with others, whether or not recovery upon such Obligations
may be or hereafter become barred by any statute of limitations, and whether or not such Obligations may be or hereafter become otherwise invalid or unenforceable. This Guaranty is a guaranty of payment and not of collection. 
 (b) Notwithstanding anything to the contrary contained in subsection (a) above, it is the intention of Guarantor and Lender that, in
any proceeding involving the bankruptcy, reorganization, arrangement, adjustment of debts, relief of debtors, dissolution or insolvency or any similar proceeding with respect to Guarantor or its assets, the amount of Guarantor’s obligations
under this Guaranty shall be in, but not in excess of, the maximum amount thereof not subject to avoidance or recovery by operation of all applicable laws 

 
governing bankruptcy, reorganization, arrangement, adjustment of debts, relief of debtors, dissolution, insolvency, fraudulent transfers or conveyances or
other similar laws (including, without limitation, 11 U.S.C. Sections 547, 548 and 550 and other “avoidance” provisions of Title 11 of the United States Code) (“Applicable Insolvency Laws”) after giving effect to subsection
(c) below. To that end, but only in the event and to the extent that after giving effect to subsection (c) below Guarantor’s obligations under this Guaranty or any payment made pursuant hereto would, but for the operation of the first
sentence of this subsection (b), be subject to avoidance or recovery in any such proceeding under Applicable Insolvency Laws after giving effect to subsection (c) below, the amount of Guarantor’s obligations under this Guaranty shall be
limited to the largest amount which, after giving effect thereto, would not, under Applicable Insolvency Laws, render Guarantor’s obligations under this Guaranty unenforceable or avoidable or otherwise subject to recovery under Applicable
Insolvency Laws. To the extent any payment actually made by Guarantor pursuant to this Guaranty exceeds the limitation of the first sentence of this subsection (b) and is otherwise subject to avoidance and recovery in any such proceeding under
Applicable Insolvency Laws, the amount subject to avoidance shall in all events be limited to the amount by which such actual payment exceeds such limitation and the obligations of Guarantor hereunder, as limited by the first sentence of this
subsection (b), shall in all events remain in full force and effect and be fully enforceable against Guarantor. The first sentence of this subsection (b) is intended solely to preserve the rights of Lender hereunder against Guarantor in such
proceeding to the maximum extent permitted by Applicable Insolvency Laws and neither Guarantor, Company, any other guarantor nor any other Person shall have any right or claim under such sentence that would not otherwise be available under
Applicable Insolvency Laws in such proceeding. 
 (c) (i) To the extent Guarantor is required, by reason of its
obligations hereunder, to pay to Lender an amount greater than the amount of value (as determined in accordance with Applicable Insolvency Laws) actually made available to or for the benefit of Guarantor on account of the Loan Agreement, this
Guaranty or any other Loan Document, Guarantor shall have an enforceable right of contribution against Company, and Company shall be liable for repayment of the full amount of such excess payment. Subject only to the subordination provided in the
following clause (ii), Guarantor further shall be subrogated to any and all rights of Lender against Company to the extent of such excess payment. 
 (ii) Notwithstanding any payment or payments by Guarantor hereunder, or any set-off or application of funds of Guarantor by Lender, or the receipt of any amounts by Lender with respect to any of the obligations of
Guarantor hereunder, Guarantor shall not be entitled to be subrogated to any of the rights of Lender against Company or any other guarantors or against any collateral security, if any, held by or for the benefit of Lender for the payment of the
Obligations nor shall Guarantor seek any reimbursement from Company in respect of payments made by Guarantor in connection with the obligations of Guarantor hereunder, until all amounts owing to Lender on account of the Obligations are paid in full
and the Aggregate Commitment is terminated. If any amount shall be paid to Guarantor on account of such subrogation rights at any time when all of the Obligations shall not have been paid in full, such amount shall be held by Guarantor in trust for
Lender, segregated from other funds of Guarantor, and shall, forthwith upon receipt by Guarantor, be turned over to Lender in the exact form received by Guarantor (duly endorsed by Guarantor to Lender, if required) to be applied 

  

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against the Obligations, whether matured or unmatured, in such order as set forth in the Loan Agreement. 
 2. Guarantor irrevocably and unconditionally guarantees the payment of the Obligations whether or not due or payable by Company upon: (a) the
dissolution, insolvency or business failure of, or any assignment for benefit of creditors by, or commencement of any bankruptcy, reorganization, arrangement, moratorium or other debtor relief proceedings by or against, Company or Guarantor, or
(b) the appointment of a receiver for, or the attachment, restraint of or making or levying of any order of court or legal process affecting, the property of Company or Guarantor, and unconditionally promises to pay such Obligations to Lender,
or order, on demand, in lawful money of the United States. 
 3. The liability of Guarantor hereunder is exclusive and independent of any
security for or other guaranty of the Obligations, whether executed by Guarantor or by any other party, and the liability of Guarantor hereunder is not affected or impaired by (a) any direction of application of payment by Company or by any
other party, or (b) any other guaranty, undertaking or maximum liability of Guarantor or of any other party as to the Obligations, or (c) any payment on or in reduction of any such other guaranty or undertaking, or (d) any revocation
or release of any obligations of any other guarantor of the guaranteed Obligations, or (e) any payment made to Lender on the Obligations which any of such Persons repay to Company pursuant to court order in any bankruptcy, reorganization,
arrangement, moratorium or other debtor relief proceeding, and Guarantor waives any right to the deferral or modification of Guarantor’s obligations hereunder by reason of any such proceeding. 
 4. (a) The obligations of Guarantor hereunder are independent of the Obligations of Company, and a separate action or actions may be brought and
prosecuted against Guarantor whether or not action is brought against Company and whether or not Company be joined in any such action or actions. Guarantor waives, to the fullest extent permitted by law, the benefit of any statute of limitations
affecting its liability hereunder or the enforcement thereof. Any payment by Company or other circumstance which operates to toll any statute of limitations as to Company shall operate to toll the statute of limitations as to Guarantor. 

(b) All payments made by Guarantor under this Guaranty shall be made without set-off or counterclaim and free and clear of and without
deductions for any present or future taxes, fees, charges, withholdings or conditions of any nature (“Taxes”). Guarantor shall pay any such Taxes, including Taxes on any amounts so paid, and will promptly furnish Lender with copies of any
tax receipts or such other evidence of payment as Lender may require. However, Guarantor shall not be liable for any income tax liability arising under the Loan. 
 5. Guarantor authorizes Lender (whether or not after termination of this Guaranty), without notice or demand (except as shall be required by applicable statute and cannot be waived), and without affecting or impairing
its liability hereunder, from time to time to (a) renew, compromise, extend, increase, accelerate or otherwise change the time for payment of, or otherwise change the terms of, the Obligations or any part thereof, including increase or decrease
of the rate of interest thereon; (b) take and hold security for the payment of this Guaranty or the Obligations and exchange, enforce, waive and release any such security; (c) apply such security 

  

 3 

 
and direct the order or manner of sale thereof as Lender, in its discretion may determine; and (d) release or substitute any one or more endorsers,
guarantors, Company or other obligors. Lender may without notice to or the further consent of Company or Guarantor assign this Guaranty in whole or in part to any person acquiring an interest in the Obligations. 
 6. It is not necessary for Lender to inquire into the capacity or power of Company or the officers acting or purporting to act on its behalf, and
Obligations made or created in reliance upon the professed exercise of such powers shall be guaranteed hereunder. 
 7. Guarantor waives any
right to require Lender to (a) proceed against Company or any other party; (b) proceed against or exhaust any security held from Company; or (c) pursue any other remedy in Lender’s power whatsoever. To this end, and without
limiting the generality of the foregoing, Guarantor expressly waives any rights Guarantor might otherwise have had under the provisions of North Carolina General Statutes §26-7 et seq.. Guarantor waives any personal defense based on or
arising out of any personal defense of Company other than payment in full of the Obligations, including, without limitation, any defense based on or arising out of the disability of Company, or the invalidity or unenforceability of the Obligations
or any part thereof from any cause, or the cessation from any cause of the liability of Company other than payment in full of the Obligations. Lender may, at its election, foreclose on any security held for the guaranteed Obligations by one or more
judicial or nonjudicial sales, or exercise any other right or remedy Lender may have against Company, or any security, without affecting or impairing in any way the liability of Guarantor hereunder except to the extent the Obligations have been
paid. Guarantor waives any defense arising out of any such election, even though such election operates to impair or extinguish any right of reimbursement or subrogation or other right or remedy of Guarantor against Company or any security.
Guarantor hereby waives, until such time as all of its obligations under this Guaranty have been performed, discharged or terminated, and all Obligations under the Loan have been performed, discharged or terminated, any claim or other rights which
Guarantor may now have or may hereafter acquire against the Company or any other guarantor of all or any of the guaranteed Obligations that arise from the existence or performance of Guarantor’s obligations under this Guaranty or any other of
the Loan Documents (as such claims and rights being referred to as the “Guarantor’s Conditional Rights”), including, without limitation, any right of subrogation, reimbursement, exoneration, contribution, or indemnification, or any
right to participate in any claim or remedy which the Lender has against the Company or any collateral which the Lender now has or hereafter acquire for the Obligations, whether or not such claim, remedy or right arises in equity or under contract,
statute or common law, by any payment made hereunder or otherwise, including, without limitation, the right to take or receive from the Company, directly or indirectly, in cash or other property or setoff or in any other manner, payment or security
on account of such claim or other rights. If, notwithstanding the foregoing provisions, any amount shall be paid to Guarantor on account of Guarantor’s Conditional Rights and either (a) such amount is paid to Guarantor at any time when the
Obligations shall not have been paid or performed in full, or (b) regardless of when such amount is paid to Guarantor any payment made by Company to the Lender is at any time determined to be a preferential payment, then such amount paid to
Guarantor shall be deemed to be held in trust for the benefit of the Lender and shall forthwith be paid to the Lender to be credited and applied upon the Obligations, whether matured or unmatured, in such order and manner as the Lender shall
determine. To the extent that any of the provisions of this 

  

 4 

 
Paragraph shall not be enforceable, Guarantor agrees that until such time as the Obligations have been paid and performed in full and the period of time has
expired during which any payment made by the Company or Guarantor to the Lender may be determined to be a preferential payment, Guarantor’s Conditional Rights to the extent not validly waived shall be subordinate to the Lender’s right to
full payment and performance of the Obligations and Guarantor shall not seek to enforce Guarantor’s Conditional Rights during such period. Guarantor waives all presentments, demands for performance, protests and notices, including, without
limitation, notices of nonperformance, notices of protest, notices of dishonor, notices of acceptance of this Guaranty, and notices of the existence, creation or incurring of new or additional Obligations. Guarantor assumes all responsibility for
being and keeping itself informed of Company’s financial condition and assets, and of all other circumstances bearing upon the risk of nonpayment of the Obligations and the nature, scope and extent of the risks which Guarantor assumes and
incurs hereunder, and agrees that Lender shall have no duty to advise Guarantor of information known to any of them regarding such circumstances or risks. 
 8. In addition to the Obligations, Guarantor agrees to pay reasonable attorneys’ fees and all other costs and expenses incurred by Lender in enforcing this Guaranty in any action or proceeding arising out of, or
relating to, this Guaranty. This Guaranty and the liability and obligations of Guarantor hereunder are binding upon Guarantor and its successors and assigns, and this Guaranty inures to the benefit of and is enforceable by Lender and its successors,
transferees, and assigns. 
 9. No right or power of Lender hereunder shall be deemed to have been waived by any act or conduct on the part
of the Lender, or by any neglect to exercise such right or power, or by any delay in so doing; and every right or power shall continue in full force and effect until specifically waived or released by an instrument in writing executed by Lender.

 10. Guarantor agrees to execute any and all further documents, instruments and agreements as Lender from time to time reasonably requests
to evidence Guarantor’s obligations hereunder. 
 11. Guarantor hereby represents and warrants and agrees that: 
 (a) Guarantor: (1) is duly organized, validly existing and in good standing as a corporation under the laws of the Commonwealth of
Virginia and is qualified to do business in each other jurisdiction where its ownership of property or conduct of business requires such qualification and where failure to qualify could have a material adverse effect on Guarantor or its property or
business or on Guarantor’s ability to pay or perform its obligations hereunder, (2) has the corporate power and authority and the legal right to own and operate its property and to conduct business in the manner in which it does and
proposes to do so, (3) is in compliance with all Requirements of Law and Contractual Obligations to the extent that failure to so comply could have a material adverse effect on Guarantor or the Company or any of their respective property or
business or on the ability of Company to pay or perform the Obligations or the ability of Guarantor to pay or perform Guarantor’s obligations hereunder, and (4) has reviewed and approved the Loan Documents. 
  

 5 

 (b) Guarantor has the corporate power and authority and the legal right to execute,
deliver and perform the Loan Documents to which it is a party and has taken all necessary corporate action to authorize the execution, delivery and performance of this Guaranty. The Loan Documents to which Guarantor is a party have been duly
executed and delivered on behalf of Guarantor and constitute legal, valid and binding obligations of Guarantor enforceable against Guarantor in accordance with their respective terms, subject to the effect of applicable bankruptcy and other similar
laws affecting the rights of creditors generally and the effect of equitable principles whether applied in an action at law or a suit in equity. 
 (c) Guarantor has not made, and will not make, any agreement which (i) prohibits or restricts the pledging or creation of lien upon the Owned Hotels, if any, which Guarantor owns or (ii) creates a lien on
the Owned Hotels, if any, which Guarantor owns (other than those agreements granting the Liens noted on Schedules III and IV to the Loan Agreement). 
 (d) The execution, delivery and performance of this Guaranty will not violate any Requirement of Law or any Contractual Obligations of
Guarantor the violation of which could have a material adverse effect on the business, operations, assets or financial or other condition of Guarantor. 
 (e) Guarantor is not an “investment company” or a company “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940, as amended. 
 (f) Neither Guarantor nor any of the Subsidiaries of Guarantor, if any, is engaged or will engage, principally or as one of its important
activities, in the business of extending credit for the purpose of “purchasing” or “carrying” any “margin stock” within the respective meanings of such terms under Regulation U. No part of the proceeds of any Loan made
under the Loan Agreement will be used, directly or indirectly, for “purchasing” or “carrying” “margin stock” as so defined or for any purpose which violates, or which would be inconsistent with, the applicable
provisions of the Regulations of the Board of Governors of the Federal Reserve System. 
 (g) No consent, approval,
authorization of, or registration, declaration or filing with, any Governmental Authority is required on the part of Guarantor in connection with the execution and delivery of the Loan Documents to which Guarantor is a party or the performance of or
compliance with the terms, provisions and conditions hereof or thereof. 
 (h) To the extent of Guarantor’s actual
control and knowledge, Guarantor shall (i) operate its hotels, if any, in material compliance with the terms of any Franchise Agreements in effect as of the date hereof; (ii) promptly perform and observe (or cause to be performed or
observed) all of the material covenants required to be performed and observed by it under the Franchise Agreements and do all things necessary to preserve 

  

 6 

 
and to keep unimpaired its material rights thereunder; (iii) promptly notify Lender of any event of default under the Franchise Agreements of which it
is aware; and (iv) promptly enforce the performance and observance of all of the covenants required to be performed and observed by the franchisor under the Franchise Agreements. To the extent of Guarantor’s actual control and knowledge,
without Lender’s prior consent, Guarantor shall not, and shall not permit the lessee under any percentage lease or any manager to: (i) surrender, terminate or cancel any Franchise Agreement; (ii) reduce or consent to the reduction of
the term of any Franchise Agreement; (iii) increase or consent to the increase of the amount of any charges under any Franchise Agreement; (iv) otherwise modify, change, supplement, alter or amend, or waive or release any of its rights and
remedies under, any Franchise Agreement or (v) suffer or permit the occurrence of continuance a default beyond any applicable cure period under any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved
by Lender) if such default permits the franchiser to terminate or cancel any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved by Lender). 
 (i) Guarantor is not and shall not be a party to any Indebtedness other than (i) the Indebtedness evidenced by this Guaranty and
(ii) the Indebtedness listed on Schedule III to the Credit Agreement, and Guarantor shall not incur any additional Indebtedness on or secured by (including, without limitation, by any Lien, pledge, encumbrance or hypothecation of
or on) any Hotel property owned by Guarantor, other than that Indebtedness contemplated on Schedules III and IV of the Loan Agreement. 
 (j) Guarantor shall maintain its corporate existence and obtain and maintain all rights, privileges, licenses, approvals, franchises,
properties and assets necessary or desirable in the normal conduct of its business, and comply with all Contractual Obligations and Requirements of Law, in each case applicable to the conduct of its business, except where the failure to so comply is
not likely to have a material adverse effect on the business, operations, assets or financial or other condition of Guarantor. 
 (k) Guarantor shall pay or otherwise satisfy at or before maturity or before it becomes delinquent or accelerated, as the case may be, all its Indebtedness (including taxes), except Indebtedness being contested in good faith by appropriate
proceedings and for which provision is made to the satisfaction of Lender for the payment thereof in the event Guarantor is found to be obligated to pay such Indebtedness and which Indebtedness is thereupon promptly paid by Guarantor. 
 (l) Guarantor shall keep proper books of record and account in which full, true and correct entries in conformity with GAAP and all
Requirements of Law shall be made of all dealings and transactions in relation to its business and activities. 
 (m)
Guarantor shall not sell, lease, assign, transfer or otherwise dispose of any of its assets (other than obsolete or worn out property), whether now owned or hereafter acquired, other than in the ordinary course of business and at fair market value,
without the prior written consent of Lender. 
  

 7 

 12. This Guaranty shall be deemed to be made under and shall be governed by the laws of the State of
North Carolina. 
 13. If any of the provisions of this Guaranty shall contravene or be held invalid under the laws of any jurisdiction, this
Guaranty shall be construed as if not containing those provisions and the rights and obligations of the parties hereto shall be construed and enforced accordingly. 
 [SIGNATURE ON NEXT PAGE] 
  

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 Executed and sealed as of the day and year first above written. 
  

			
	APPLE SEVEN HOSPITALITY OWNERSHIP, INC., a Virginia corporation
		
	By:	 	/s/ Justin G. Knight
	Name:	 	Justin G. Knight
	Title:	 	President

 GUARANTY 
 THIS GUARANTY (the “Guaranty”) is made and dated as of the 14th day of December, 2006 by APPLE SEVEN TEXAS GP, Inc., a Virginia corporation (“Guarantor”). 
 RECITALS 
 A. Pursuant to that certain Loan Agreement of even date herewith between Apple REIT Seven, Inc. (the
“Company”) and Wachovia Bank, National Association (the “Lender”), (as amended, extended and replaced from time to time, the “Loan Agreement,” and with capitalized terms not otherwise defined herein used with the same
meanings as in the Loan Agreement) the Lender has agreed to extend credit to the Company, on the terms and subject to the conditions set forth therein. 
 B. As a condition precedent to the effectiveness of the Loan Documents and pursuant to the terms of and as specifically required as a condition to the effectiveness of the Loan Agreement, Guarantor is required to
execute and deliver to the Lender this Guaranty. 
 C. Guarantor is wholly-owned by Apple Seven Hospitality Ownership, Inc., which is
wholly-owned by Apple Seven Hospitality, Inc., which is a wholly-owned subsidiary of the Company, and thus will derive material benefit from the extension of credit by the Lender to the Company pursuant to the Loan Agreement. 
 NOW, THEREFORE, in consideration of the above Recitals and for other good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, Guarantor hereby agrees as follows: 
 AGREEMENT 
 1. (a) Guarantor hereby irrevocably and unconditionally guarantees the payment when due, upon maturity, acceleration or otherwise, of the
Obligations, whether heretofore, now, or hereafter made, incurred or created, whether voluntary or involuntary and however arising, absolute or contingent, liquidated or unliquidated, determined or undetermined, whether or not such Obligations are
from time to time reduced, or extinguished and thereafter increased or incurred, whether Company may be liable individually or jointly with others, whether or not recovery upon such Obligations may be or hereafter become barred by any statute of
limitations, and whether or not such Obligations may be or hereafter become otherwise invalid or unenforceable. This Guaranty is a guaranty of payment and not of collection. 
 (b) Notwithstanding anything to the contrary contained in subsection (a) above, it is the intention of Guarantor and Lender that, in
any proceeding involving the bankruptcy, reorganization, arrangement, adjustment of debts, relief of debtors, dissolution or insolvency or any similar proceeding with respect to Guarantor or its assets, the amount of Guarantor’s obligations
under this Guaranty shall be in, but not in excess of, the maximum 

 
amount thereof not subject to avoidance or recovery by operation of all applicable laws governing bankruptcy, reorganization, arrangement, adjustment of
debts, relief of debtors, dissolution, insolvency, fraudulent transfers or conveyances or other similar laws (including, without limitation, 11 U.S.C. Sections 547, 548 and 550 and other “avoidance” provisions of Title 11 of the United
States Code) (“Applicable Insolvency Laws”) after giving effect to subsection (c) below. To that end, but only in the event and to the extent that after giving effect to subsection (c) below Guarantor’s obligations under
this Guaranty or any payment made pursuant hereto would, but for the operation of the first sentence of this subsection (b), be subject to avoidance or recovery in any such proceeding under Applicable Insolvency Laws after giving effect to
subsection (c) below, the amount of Guarantor’s obligations under this Guaranty shall be limited to the largest amount which, after giving effect thereto, would not, under Applicable Insolvency Laws, render Guarantor’s obligations
under this Guaranty unenforceable or avoidable or otherwise subject to recovery under Applicable Insolvency Laws. To the extent any payment actually made by Guarantor pursuant to this Guaranty exceeds the limitation of the first sentence of this
subsection (b) and is otherwise subject to avoidance and recovery in any such proceeding under Applicable Insolvency Laws, the amount subject to avoidance shall in all events be limited to the amount by which such actual payment exceeds such
limitation and the obligations of Guarantor hereunder, as limited by the first sentence of this subsection (b), shall in all events remain in full force and effect and be fully enforceable against Guarantor. The first sentence of this subsection
(b) is intended solely to preserve the rights of Lender hereunder against Guarantor in such proceeding to the maximum extent permitted by Applicable Insolvency Laws and neither Guarantor, Company, any other guarantor nor any other Person shall
have any right or claim under such sentence that would not otherwise be available under Applicable Insolvency Laws in such proceeding. 
 (c) (i) To the extent Guarantor is required, by reason of its obligations hereunder, to pay to Lender an amount greater than the amount of value (as determined in accordance with Applicable Insolvency Laws)
actually made available to or for the benefit of Guarantor on account of the Loan Agreement, this Guaranty or any other Loan Document, Guarantor shall have an enforceable right of contribution against Company, and Company shall be liable for
repayment of the full amount of such excess payment. Subject only to the subordination provided in the following clause (ii), Guarantor further shall be subrogated to any and all rights of Lender against Company to the extent of such excess payment.

 (ii) Notwithstanding any payment or payments by Guarantor hereunder, or any set-off or application of funds of Guarantor by
Lender, or the receipt of any amounts by Lender with respect to any of the obligations of Guarantor hereunder, Guarantor shall not be entitled to be subrogated to any of the rights of Lender against Company or any other guarantors or against any
collateral security, if any, held by or for the benefit of Lender for the payment of the Obligations nor shall Guarantor seek any reimbursement from Company in respect of payments made by Guarantor in connection with the obligations of Guarantor
hereunder, until all amounts owing to Lender on account of the Obligations are paid in full and the Aggregate Commitment is terminated. If any amount shall be paid to Guarantor on account of such subrogation rights at any time when all of the
Obligations shall not have been paid in full, such amount shall be held by Guarantor in trust for Lender, segregated from other funds of Guarantor, and shall, forthwith upon receipt by Guarantor, be turned over to Lender in the exact 

  

 2 

 
form received by Guarantor (duly endorsed by Guarantor to Lender, if required) to be applied against the Obligations, whether matured or unmatured, in such
order as set forth in the Loan Agreement. 
 2. Guarantor irrevocably and unconditionally guarantees the payment of the Obligations whether
or not due or payable by Company upon: (a) the dissolution, insolvency or business failure of, or any assignment for benefit of creditors by, or commencement of any bankruptcy, reorganization, arrangement, moratorium or other debtor relief
proceedings by or against, Company or Guarantor, or (b) the appointment of a receiver for, or the attachment, restraint of or making or levying of any order of court or legal process affecting, the property of Company or Guarantor, and
unconditionally promises to pay such Obligations to Lender, or order, on demand, in lawful money of the United States. 
 3. The liability of
Guarantor hereunder is exclusive and independent of any security for or other guaranty of the Obligations, whether executed by Guarantor or by any other party, and the liability of Guarantor hereunder is not affected or impaired by (a) any
direction of application of payment by Company or by any other party, or (b) any other guaranty, undertaking or maximum liability of Guarantor or of any other party as to the Obligations, or (c) any payment on or in reduction of any such
other guaranty or undertaking, or (d) any revocation or release of any obligations of any other guarantor of the guaranteed Obligations, or (e) any payment made to Lender on the Obligations which any of such Persons repay to Company
pursuant to court order in any bankruptcy, reorganization, arrangement, moratorium or other debtor relief proceeding, and Guarantor waives any right to the deferral or modification of Guarantor’s obligations hereunder by reason of any such
proceeding. 
 4. (a) The obligations of Guarantor hereunder are independent of the Obligations of Company, and a separate action or actions
may be brought and prosecuted against Guarantor whether or not action is brought against Company and whether or not Company be joined in any such action or actions. Guarantor waives, to the fullest extent permitted by law, the benefit of any statute
of limitations affecting its liability hereunder or the enforcement thereof. Any payment by Company or other circumstance which operates to toll any statute of limitations as to Company shall operate to toll the statute of limitations as to
Guarantor. 
 (b) All payments made by Guarantor under this Guaranty shall be made without set-off or counterclaim and free
and clear of and without deductions for any present or future taxes, fees, charges, withholdings or conditions of any nature (“Taxes”). Guarantor shall pay any such Taxes, including Taxes on any amounts so paid, and will promptly furnish
Lender with copies of any tax receipts or such other evidence of payment as Lender may require. However, Guarantor shall not be liable for any income tax liability arising under the Loan. 
 5. Guarantor authorizes Lender (whether or not after termination of this Guaranty), without notice or demand (except as shall be required by applicable
statute and cannot be waived), and without affecting or impairing its liability hereunder, from time to time to (a) renew, compromise, extend, increase, accelerate or otherwise change the time for payment of, or otherwise change the terms of,
the Obligations or any part thereof, including increase or decrease of the rate of interest thereon; (b) take and hold security for the payment of this Guaranty or the 

  

 3 

 
Obligations and exchange, enforce, waive and release any such security; (c) apply such security and direct the order or manner of sale thereof as
Lender, in its discretion may determine; and (d) release or substitute any one or more endorsers, guarantors, Company or other obligors. Lender may without notice to or the further consent of Company or Guarantor assign this Guaranty in whole
or in part to any person acquiring an interest in the Obligations. 
 6. It is not necessary for Lender to inquire into the capacity or power
of Company or the officers acting or purporting to act on its behalf, and Obligations made or created in reliance upon the professed exercise of such powers shall be guaranteed hereunder. 
 7. Guarantor waives any right to require Lender to (a) proceed against Company or any other party; (b) proceed against or exhaust any security
held from Company; or (c) pursue any other remedy in Lender’s power whatsoever. To this end, and without limiting the generality of the foregoing, Guarantor expressly waives any rights Guarantor might otherwise have had under the
provisions of North Carolina General Statutes §26-7 et seq.. Guarantor waives any personal defense based on or arising out of any personal defense of Company other than payment in full of the Obligations, including, without limitation,
any defense based on or arising out of the disability of Company, or the invalidity or unenforceability of the Obligations or any part thereof from any cause, or the cessation from any cause of the liability of Company other than payment in full of
the Obligations. Lender may, at its election, foreclose on any security held for the guaranteed Obligations by one or more judicial or nonjudicial sales, or exercise any other right or remedy Lender may have against Company, or any security, without
affecting or impairing in any way the liability of Guarantor hereunder except to the extent the Obligations have been paid. Guarantor waives any defense arising out of any such election, even though such election operates to impair or extinguish any
right of reimbursement or subrogation or other right or remedy of Guarantor against Company or any security. Guarantor hereby waives, until such time as all of its obligations under this Guaranty have been performed, discharged or terminated, and
all Obligations under the Loan have been performed, discharged or terminated, any claim or other rights which Guarantor may now have or may hereafter acquire against the Company or any other guarantor of all or any of the guaranteed Obligations that
arise from the existence or performance of Guarantor’s obligations under this Guaranty or any other of the Loan Documents (as such claims and rights being referred to as the “Guarantor’s Conditional Rights”), including, without
limitation, any right of subrogation, reimbursement, exoneration, contribution, or indemnification, or any right to participate in any claim or remedy which the Lender has against the Company or any collateral which the Lender now has or hereafter
acquire for the Obligations, whether or not such claim, remedy or right arises in equity or under contract, statute or common law, by any payment made hereunder or otherwise, including, without limitation, the right to take or receive from the
Company, directly or indirectly, in cash or other property or setoff or in any other manner, payment or security on account of such claim or other rights. If, notwithstanding the foregoing provisions, any amount shall be paid to Guarantor on account
of Guarantor’s Conditional Rights and either (a) such amount is paid to Guarantor at any time when the Obligations shall not have been paid or performed in full, or (b) regardless of when such amount is paid to Guarantor any payment
made by Company to the Lender is at any time determined to be a preferential payment, then such amount paid to Guarantor shall be deemed to be held in trust for the benefit of the Lender and shall forthwith be paid to the Lender to be credited and
applied upon the Obligations, whether matured or unmatured, in such order 

  

 4 

 
and manner as the Lender shall determine. To the extent that any of the provisions of this Paragraph shall not be enforceable, Guarantor agrees that until
such time as the Obligations have been paid and performed in full and the period of time has expired during which any payment made by the Company or Guarantor to the Lender may be determined to be a preferential payment, Guarantor’s Conditional
Rights to the extent not validly waived shall be subordinate to the Lender’s right to full payment and performance of the Obligations and Guarantor shall not seek to enforce Guarantor’s Conditional Rights during such period. Guarantor
waives all presentments, demands for performance, protests and notices, including, without limitation, notices of nonperformance, notices of protest, notices of dishonor, notices of acceptance of this Guaranty, and notices of the existence, creation
or incurring of new or additional Obligations. Guarantor assumes all responsibility for being and keeping itself informed of Company’s financial condition and assets, and of all other circumstances bearing upon the risk of nonpayment of the
Obligations and the nature, scope and extent of the risks which Guarantor assumes and incurs hereunder, and agrees that Lender shall have no duty to advise Guarantor of information known to any of them regarding such circumstances or risks.

 8. In addition to the Obligations, Guarantor agrees to pay reasonable attorneys’ fees and all other costs and expenses incurred by
Lender in enforcing this Guaranty in any action or proceeding arising out of, or relating to, this Guaranty. This Guaranty and the liability and obligations of Guarantor hereunder are binding upon Guarantor and its successors and assigns, and this
Guaranty inures to the benefit of and is enforceable by Lender and its successors, transferees, and assigns. 
 9. No right or power of
Lender hereunder shall be deemed to have been waived by any act or conduct on the part of the Lender, or by any neglect to exercise such right or power, or by any delay in so doing; and every right or power shall continue in full force and effect
until specifically waived or released by an instrument in writing executed by Lender. 
 10. Guarantor agrees to execute any and all further
documents, instruments and agreements as Lender from time to time reasonably requests to evidence Guarantor’s obligations hereunder. 
 11. Guarantor hereby represents and warrants and agrees that: 
 (a) Guarantor: (1) is duly organized, validly
existing and in good standing as a corporation under the laws of the Commonwealth of Virginia and is qualified to do business in each other jurisdiction where its ownership of property or conduct of business requires such qualification and where
failure to qualify could have a material adverse effect on Guarantor or its property or business or on Guarantor’s ability to pay or perform its obligations hereunder, (2) has the corporate power and authority and the legal right to own
and operate its property and to conduct business in the manner in which it does and proposes to do so, (3) is in compliance with all Requirements of Law and Contractual Obligations to the extent that failure to so comply could have a material
adverse effect on Guarantor or the Company or any of their respective property or business or on the ability of Company to pay or perform the Obligations or the ability of Guarantor to pay or 

  

 5 

 
perform Guarantor’s obligations hereunder, and (4) has reviewed and approved the Loan Documents. 
 (b) Guarantor has the corporate power and authority and the legal right to execute, deliver and perform the Loan Documents to which it is
a party and has taken all necessary corporate action to authorize the execution, delivery and performance of this Guaranty. The Loan Documents to which Guarantor is a party have been duly executed and delivered on behalf of Guarantor and constitute
legal, valid and binding obligations of Guarantor enforceable against Guarantor in accordance with their respective terms, subject to the effect of applicable bankruptcy and other similar laws affecting the rights of creditors generally and the
effect of equitable principles whether applied in an action at law or a suit in equity. 
 (c) Guarantor has not made, and
will not make, any agreement which (i) prohibits or restricts the pledging or creation of lien upon the Owned Hotels, if any, which Guarantor owns or (ii) creates a lien on the Owned Hotels, if any, which Guarantor owns (other than those
agreements granting the Liens noted on Schedules III and IV to the Loan Agreement). 
 (d) The
execution, delivery and performance of this Guaranty will not violate any Requirement of Law or any Contractual Obligations of Guarantor the violation of which could have a material adverse effect on the business, operations, assets or financial or
other condition of Guarantor. 
 (e) Guarantor is not an “investment company” or a company “controlled” by
an “investment company” within the meaning of the Investment Company Act of 1940, as amended. 
 (f) Neither
Guarantor nor any of the Subsidiaries of Guarantor, if any, is engaged or will engage, principally or as one of its important activities, in the business of extending credit for the purpose of “purchasing” or “carrying” any
“margin stock” within the respective meanings of such terms under Regulation U. No part of the proceeds of any Loan made under the Loan Agreement will be used, directly or indirectly, for “purchasing” or “carrying”
“margin stock” as so defined or for any purpose which violates, or which would be inconsistent with, the applicable provisions of the Regulations of the Board of Governors of the Federal Reserve System. 
 (g) No consent, approval, authorization of, or registration, declaration or filing with, any Governmental Authority is required on the
part of Guarantor in connection with the execution and delivery of the Loan Documents to which Guarantor is a party or the performance of or compliance with the terms, provisions and conditions hereof or thereof. 
 (h) To the extent of Guarantor’s actual control and knowledge, Guarantor shall (i) operate its hotels, if any, in material
compliance with the terms of any Franchise Agreements in effect as of the date hereof; (ii) promptly perform and observe (or cause to 

  

 6 

 
be performed or observed) all of the material covenants required to be performed and observed by it under the Franchise Agreements and do all things
necessary to preserve and to keep unimpaired its material rights thereunder; (iii) promptly notify Lender of any event of default under the Franchise Agreements of which it is aware; and (iv) promptly enforce the performance and observance
of all of the covenants required to be performed and observed by the franchisor under the Franchise Agreements. To the extent of Guarantor’s actual control and knowledge, without Lender’s prior consent, Guarantor shall not, and shall not
permit the lessee under any percentage lease or any manager to: (i) surrender, terminate or cancel any Franchise Agreement; (ii) reduce or consent to the reduction of the term of any Franchise Agreement; (iii) increase or consent to
the increase of the amount of any charges under any Franchise Agreement; (iv) otherwise modify, change, supplement, alter or amend, or waive or release any of its rights and remedies under, any Franchise Agreement or (v) suffer or permit
the occurrence of continuance a default beyond any applicable cure period under any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved by Lender) if such default permits the franchiser to terminate or
cancel any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved by Lender). 
 (i)
Guarantor is not and shall not be a party to any Indebtedness other than (i) the Indebtedness evidenced by this Guaranty and (ii) the Indebtedness listed on Schedule III to the Credit Agreement, and Guarantor shall not incur
any additional Indebtedness on or secured by (including, without limitation, by any Lien, pledge, encumbrance or hypothecation of or on) any Hotel property owned by Guarantor, other than that Indebtedness contemplated on Schedules III
and IV of the Loan Agreement. 
 (j) Guarantor shall maintain its corporate existence and obtain and
maintain all rights, privileges, licenses, approvals, franchises, properties and assets necessary or desirable in the normal conduct of its business, and comply with all Contractual Obligations and Requirements of Law, in each case applicable to the
conduct of its business, except where the failure to so comply would not have a material adverse effect on the business, operations, assets or financial or other condition of Guarantor. 
 (k) Guarantor shall pay or otherwise satisfy at or before maturity or before it becomes delinquent or accelerated, as the case may be, all
its Indebtedness (including taxes), except Indebtedness being contested in good faith by appropriate proceedings and for which provision is made to the satisfaction of Lender for the payment thereof in the event Guarantor is found to be obligated to
pay such Indebtedness and which Indebtedness is thereupon promptly paid by Guarantor. 
 (l) Guarantor shall keep proper books
of record and account in which full, true and correct entries in conformity with GAAP and all Requirements of Law shall be made of all dealings and transactions in relation to its business and activities. 
 (m) Guarantor shall not sell, lease, assign, transfer or otherwise dispose of any of its assets (other than obsolete or worn out
property), whether now owned or hereafter 

  

 7 

 
acquired, other than in the ordinary course of business and at fair market value, without the prior written consent of Lender. 
 12. This Guaranty shall be deemed to be made under and shall be governed by the laws of the State of North Carolina. 
 13. If any of the provisions of this Guaranty shall contravene or be held invalid under the laws of any jurisdiction, this Guaranty shall be construed as
if not containing those provisions and the rights and obligations of the parties hereto shall be construed and enforced accordingly. 
 [SIGNATURE ON NEXT PAGE] 
  

 8 

 Executed and sealed as of the day and year first above written. 
  

			
	APPLE SEVEN TEXAS GP, INC., a Virginia corporation
		
	By:	 	/s/ Justin G. Knight
	Name:	 	Justin G. Knight
	Title:	 	President

 GUARANTY 
 THIS GUARANTY (the “Guaranty”) is made and dated as of the 14th day of
December, 2006 by APPLE SEVEN TEXAS LP, INC., a Virginia corporation (“Guarantor”). 
 RECITALS 
 A. Pursuant to that certain Loan Agreement of even date herewith between Apple REIT Seven, Inc. (the “Company”) and Wachovia Bank, National
Association (the “Lender”), (as amended, extended and replaced from time to time, the “Loan Agreement,” and with capitalized terms not otherwise defined herein used with the same meanings as in the Loan Agreement) the Lender has
agreed to extend credit to the Company, on the terms and subject to the conditions set forth therein. 
 B. As a condition precedent to the
effectiveness of the Loan Documents and pursuant to the terms of and as specifically required as a condition to the effectiveness of the Loan Agreement, Guarantor is required to execute and deliver to the Lender this Guaranty. 
 C. Guarantor is wholly-owned by Apple Seven Hospitality Ownership, Inc., which is wholly-owned by Apple Seven Hospitality, Inc., which is a wholly-owned
subsidiary of the Company, and thus will derive material benefit from the extension of credit by the Lender to the Company pursuant to the Loan Agreement. 
 NOW, THEREFORE, in consideration of the above Recitals and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, Guarantor hereby agrees as follows: 
 AGREEMENT 
 1. (a) Guarantor
hereby irrevocably and unconditionally guarantees the payment when due, upon maturity, acceleration or otherwise, of the Obligations, whether heretofore, now, or hereafter made, incurred or created, whether voluntary or involuntary and however
arising, absolute or contingent, liquidated or unliquidated, determined or undetermined, whether or not such Obligations are from time to time reduced, or extinguished and thereafter increased or incurred, whether Company may be liable individually
or jointly with others, whether or not recovery upon such Obligations may be or hereafter become barred by any statute of limitations, and whether or not such Obligations may be or hereafter become otherwise invalid or unenforceable. This Guaranty
is a guaranty of payment and not of collection. 
 (b) Notwithstanding anything to the contrary contained in subsection
(a) above, it is the intention of Guarantor and Lender that, in any proceeding involving the bankruptcy, reorganization, arrangement, adjustment of debts, relief of debtors, dissolution or insolvency or any similar proceeding with respect to
Guarantor or its assets, the amount of Guarantor’s obligations under this Guaranty shall be in, but not in excess of, the maximum 

 
amount thereof not subject to avoidance or recovery by operation of all applicable laws governing bankruptcy, reorganization, arrangement, adjustment of
debts, relief of debtors, dissolution, insolvency, fraudulent transfers or conveyances or other similar laws (including, without limitation, 11 U.S.C. Sections 547, 548 and 550 and other “avoidance” provisions of Title 11 of the United
States Code) (“Applicable Insolvency Laws”) after giving effect to subsection (c) below. To that end, but only in the event and to the extent that after giving effect to subsection (c) below Guarantor’s obligations under
this Guaranty or any payment made pursuant hereto would, but for the operation of the first sentence of this subsection (b), be subject to avoidance or recovery in any such proceeding under Applicable Insolvency Laws after giving effect to
subsection (c) below, the amount of Guarantor’s obligations under this Guaranty shall be limited to the largest amount which, after giving effect thereto, would not, under Applicable Insolvency Laws, render Guarantor’s obligations
under this Guaranty unenforceable or avoidable or otherwise subject to recovery under Applicable Insolvency Laws. To the extent any payment actually made by Guarantor pursuant to this Guaranty exceeds the limitation of the first sentence of this
subsection (b) and is otherwise subject to avoidance and recovery in any such proceeding under Applicable Insolvency Laws, the amount subject to avoidance shall in all events be limited to the amount by which such actual payment exceeds such
limitation and the obligations of Guarantor hereunder, as limited by the first sentence of this subsection (b), shall in all events remain in full force and effect and be fully enforceable against Guarantor. The first sentence of this subsection
(b) is intended solely to preserve the rights of Lender hereunder against Guarantor in such proceeding to the maximum extent permitted by Applicable Insolvency Laws and neither Guarantor, Company, any other guarantor nor any other Person shall
have any right or claim under such sentence that would not otherwise be available under Applicable Insolvency Laws in such proceeding. 
 (c) (i) To the extent Guarantor is required, by reason of its obligations hereunder, to pay to Lender an amount greater than the amount of value (as determined in accordance with Applicable Insolvency Laws)
actually made available to or for the benefit of Guarantor on account of the Loan Agreement, this Guaranty or any other Loan Document, Guarantor shall have an enforceable right of contribution against Company, and Company shall be liable for
repayment of the full amount of such excess payment. Subject only to the subordination provided in the following clause (ii), Guarantor further shall be subrogated to any and all rights of Lender against Company to the extent of such excess payment.

 (ii) Notwithstanding any payment or payments by Guarantor hereunder, or any set-off or application of funds of Guarantor by
Lender, or the receipt of any amounts by Lender with respect to any of the obligations of Guarantor hereunder, Guarantor shall not be entitled to be subrogated to any of the rights of Lender against Company or any other guarantors or against any
collateral security, if any, held by or for the benefit of Lender for the payment of the Obligations nor shall Guarantor seek any reimbursement from Company in respect of payments made by Guarantor in connection with the obligations of Guarantor
hereunder, until all amounts owing to Lender on account of the Obligations are paid in full and the Aggregate Commitment is terminated. If any amount shall be paid to Guarantor on account of such subrogation rights at any time when all of the
Obligations shall not have been paid in full, such amount shall be held by Guarantor in trust for Lender, segregated from other funds of Guarantor, and shall, forthwith upon receipt by Guarantor, be turned over to Lender in the exact 

  

 2 

 
form received by Guarantor (duly endorsed by Guarantor to Lender, if required) to be applied against the Obligations, whether matured or unmatured, in such
order as set forth in the Loan Agreement. 
 2. Guarantor irrevocably and unconditionally guarantees the payment of the Obligations whether
or not due or payable by Company upon: (a) the dissolution, insolvency or business failure of, or any assignment for benefit of creditors by, or commencement of any bankruptcy, reorganization, arrangement, moratorium or other debtor relief
proceedings by or against, Company or Guarantor, or (b) the appointment of a receiver for, or the attachment, restraint of or making or levying of any order of court or legal process affecting, the property of Company or Guarantor, and
unconditionally promises to pay such Obligations to Lender, or order, on demand, in lawful money of the United States. 
 3. The liability of
Guarantor hereunder is exclusive and independent of any security for or other guaranty of the Obligations, whether executed by Guarantor or by any other party, and the liability of Guarantor hereunder is not affected or impaired by (a) any
direction of application of payment by Company or by any other party, or (b) any other guaranty, undertaking or maximum liability of Guarantor or of any other party as to the Obligations, or (c) any payment on or in reduction of any such
other guaranty or undertaking, or (d) any revocation or release of any obligations of any other guarantor of the guaranteed Obligations, or (e) any payment made to Lender on the Obligations which any of such Persons repay to Company
pursuant to court order in any bankruptcy, reorganization, arrangement, moratorium or other debtor relief proceeding, and Guarantor waives any right to the deferral or modification of Guarantor’s obligations hereunder by reason of any such
proceeding. 
 4. (a) The obligations of Guarantor hereunder are independent of the Obligations of Company, and a separate action or actions
may be brought and prosecuted against Guarantor whether or not action is brought against Company and whether or not Company be joined in any such action or actions. Guarantor waives, to the fullest extent permitted by law, the benefit of any statute
of limitations affecting its liability hereunder or the enforcement thereof. Any payment by Company or other circumstance which operates to toll any statute of limitations as to Company shall operate to toll the statute of limitations as to
Guarantor. 
 (b) All payments made by Guarantor under this Guaranty shall be made without set-off or counterclaim and free
and clear of and without deductions for any present or future taxes, fees, charges, withholdings or conditions of any nature (“Taxes”). Guarantor shall pay any such Taxes, including Taxes on any amounts so paid, and will promptly furnish
Lender with copies of any tax receipts or such other evidence of payment as Lender may require. However, Guarantor shall not be liable for any income tax liability arising under the Loan. 
 5. Guarantor authorizes Lender (whether or not after termination of this Guaranty), without notice or demand (except as shall be required by applicable
statute and cannot be waived), and without affecting or impairing its liability hereunder, from time to time to (a) renew, compromise, extend, increase, accelerate or otherwise change the time for payment of, or otherwise change the terms of,
the Obligations or any part thereof, including increase or decrease of the rate of interest thereon; (b) take and hold security for the payment of this Guaranty or the 

  

 3 

 
Obligations and exchange, enforce, waive and release any such security; (c) apply such security and direct the order or manner of sale thereof as
Lender, in its discretion may determine; and (d) release or substitute any one or more endorsers, guarantors, Company or other obligors. Lender may without notice to or the further consent of Company or Guarantor assign this Guaranty in whole
or in part to any person acquiring an interest in the Obligations. 
 6. It is not necessary for Lender to inquire into the capacity or power
of Company or the officers acting or purporting to act on its behalf, and Obligations made or created in reliance upon the professed exercise of such powers shall be guaranteed hereunder. 
 7. Guarantor waives any right to require Lender to (a) proceed against Company or any other party; (b) proceed against or exhaust any security
held from Company; or (c) pursue any other remedy in Lender’s power whatsoever. To this end, and without limiting the generality of the foregoing, Guarantor expressly waives any rights Guarantor might otherwise have had under the
provisions of North Carolina General Statutes §26-7 et seq. Guarantor waives any personal defense based on or arising out of any personal defense of Company other than payment in full of the Obligations, including, without limitation,
any defense based on or arising out of the disability of Company, or the invalidity or unenforceability of the Obligations or any part thereof from any cause, or the cessation from any cause of the liability of Company other than payment in full of
the Obligations. Lender may, at its election, foreclose on any security held for the guaranteed Obligations by one or more judicial or nonjudicial sales, or exercise any other right or remedy Lender may have against Company, or any security, without
affecting or impairing in any way the liability of Guarantor hereunder except to the extent the Obligations have been paid. Guarantor waives any defense arising out of any such election, even though such election operates to impair or extinguish any
right of reimbursement or subrogation or other right or remedy of Guarantor against Company or any security. Guarantor hereby waives, until such time as all of its obligations under this Guaranty have been performed, discharged or terminated, and
all Obligations under the Loan have been performed, discharged or terminated, any claim or other rights which Guarantor may now have or may hereafter acquire against the Company or any other guarantor of all or any of the guaranteed Obligations that
arise from the existence or performance of Guarantor’s obligations under this Guaranty or any other of the Loan Documents (as such claims and rights being referred to as the “Guarantor’s Conditional Rights”), including, without
limitation, any right of subrogation, reimbursement, exoneration, contribution, or indemnification, or any right to participate in any claim or remedy which the Lender has against the Company or any collateral which the Lender now has or hereafter
acquire for the Obligations, whether or not such claim, remedy or right arises in equity or under contract, statute or common law, by any payment made hereunder or otherwise, including, without limitation, the right to take or receive from the
Company, directly or indirectly, in cash or other property or setoff or in any other manner, payment or security on account of such claim or other rights. If, notwithstanding the foregoing provisions, any amount shall be paid to Guarantor on account
of Guarantor’s Conditional Rights and either (a) such amount is paid to Guarantor at any time when the Obligations shall not have been paid or performed in full, or (b) regardless of when such amount is paid to Guarantor any payment
made by Company to the Lender is at any time determined to be a preferential payment, then such amount paid to Guarantor shall be deemed to be held in trust for the benefit of the Lender and shall forthwith be paid to the Lender to be credited and
applied upon the Obligations, whether matured or unmatured, in such order 

  

 4 

 
and manner as the Lender shall determine. To the extent that any of the provisions of this Paragraph shall not be enforceable, Guarantor agrees that until
such time as the Obligations have been paid and performed in full and the period of time has expired during which any payment made by the Company or Guarantor to the Lender may be determined to be a preferential payment, Guarantor’s Conditional
Rights to the extent not validly waived shall be subordinate to the Lender’s right to full payment and performance of the Obligations and Guarantor shall not seek to enforce Guarantor’s Conditional Rights during such period. Guarantor
waives all presentments, demands for performance, protests and notices, including, without limitation, notices of nonperformance, notices of protest, notices of dishonor, notices of acceptance of this Guaranty, and notices of the existence, creation
or incurring of new or additional Obligations. Guarantor assumes all responsibility for being and keeping itself informed of Company’s financial condition and assets, and of all other circumstances bearing upon the risk of nonpayment of the
Obligations and the nature, scope and extent of the risks which Guarantor assumes and incurs hereunder, and agrees that Lender shall have no duty to advise Guarantor of information known to any of them regarding such circumstances or risks.

 8. In addition to the Obligations, Guarantor agrees to pay reasonable attorneys’ fees and all other costs and expenses incurred by
Lender in enforcing this Guaranty in any action or proceeding arising out of, or relating to, this Guaranty. This Guaranty and the liability and obligations of Guarantor hereunder are binding upon Guarantor and its successors and assigns, and this
Guaranty inures to the benefit of and is enforceable by Lender and its successors, transferees, and assigns. 
 9. No right or power of
Lender hereunder shall be deemed to have been waived by any act or conduct on the part of the Lender, or by any neglect to exercise such right or power, or by any delay in so doing; and every right or power shall continue in full force and effect
until specifically waived or released by an instrument in writing executed by Lender. 
 10. Guarantor agrees to execute any and all further
documents, instruments and agreements as Lender from time to time reasonably requests to evidence Guarantor’s obligations hereunder. 
 11. Guarantor hereby represents and warrants and agrees that: 
 (a) Guarantor: (1) is duly organized, validly
existing and in good standing as a corporation under the laws of the Commonwealth of Virginia and is qualified to do business in each other jurisdiction where its ownership of property or conduct of business requires such qualification and where
failure to qualify could have a material adverse effect on Guarantor or its property or business or on Guarantor’s ability to pay or perform its obligations hereunder, (2) has the corporate power and authority and the legal right to own
and operate its property and to conduct business in the manner in which it does and proposes to do so, (3) is in compliance with all Requirements of Law and Contractual Obligations to the extent that failure to so comply could have a material
adverse effect on Guarantor or the Company or any of their respective property or business or on the ability of Company to pay or perform the Obligations or the ability of Guarantor to pay or 

  

 5 

 
perform Guarantor’s obligations hereunder, and (4) has reviewed and approved the Loan Documents. 
 (b) Guarantor has the corporate power and authority and the legal right to execute, deliver and perform the Loan Documents to which it is
a party and has taken all necessary corporate action to authorize the execution, delivery and performance of this Guaranty. The Loan Documents to which Guarantor is a party have been duly executed and delivered on behalf of Guarantor and constitute
legal, valid and binding obligations of Guarantor enforceable against Guarantor in accordance with their respective terms, subject to the effect of applicable bankruptcy and other similar laws affecting the rights of creditors generally and the
effect of equitable principles whether applied in an action at law or a suit in equity. 
 (c) Guarantor has not made, and
will not make, any agreement which (i) prohibits or restricts the pledging or creation of lien upon the Owned Hotels, if any, which Guarantor owns or (ii) creates a lien on the Owned Hotels, if any, which Guarantor owns (other than those
agreements granting the Liens noted on Schedules III and IV to the Loan Agreement). 
 (d) The
execution, delivery and performance of this Guaranty will not violate any Requirement of Law or any Contractual Obligations of Guarantor the violation of which could have a material adverse effect on the business, operations, assets or financial or
other condition of Guarantor. 
 (e) Guarantor is not an “investment company” or a company “controlled” by
an “investment company” within the meaning of the Investment Company Act of 1940, as amended. 
 (f) Neither
Guarantor nor any of the Subsidiaries of Guarantor, if any, is engaged or will engage, principally or as one of its important activities, in the business of extending credit for the purpose of “purchasing” or “carrying” any
“margin stock” within the respective meanings of such terms under Regulation U. No part of the proceeds of any Loan made under the Loan Agreement will be used, directly or indirectly, for “purchasing” or “carrying”
“margin stock” as so defined or for any purpose which violates, or which would be inconsistent with, the applicable provisions of the Regulations of the Board of Governors of the Federal Reserve System. 
 (g) No consent, approval, authorization of, or registration, declaration or filing with, any Governmental Authority is required on the
part of Guarantor in connection with the execution and delivery of the Loan Documents to which Guarantor is a party or the performance of or compliance with the terms, provisions and conditions hereof or thereof. 
 (h) To the extent of Guarantor’s actual control and knowledge, Guarantor shall (i) operate its hotels, if any, in material
compliance with the terms of any Franchise Agreements in effect as of the date hereof; (ii) promptly perform and observe (or cause to 

  

 6 

 
be performed or observed) all of the material covenants required to be performed and observed by it under the Franchise Agreements and do all things
necessary to preserve and to keep unimpaired its material rights thereunder; (iii) promptly notify Lender of any event of default under the Franchise Agreements of which it is aware; and (iv) promptly enforce the performance and observance
of all of the covenants required to be performed and observed by the franchisor under the Franchise Agreements. To the extent of Guarantor’s actual control and knowledge, without Lender’s prior consent, Guarantor shall not, and shall not
permit the lessee under any percentage lease or any manager to: (i) surrender, terminate or cancel any Franchise Agreement; (ii) reduce or consent to the reduction of the term of any Franchise Agreement; (iii) increase or consent to
the increase of the amount of any charges under any Franchise Agreement; (iv) otherwise modify, change, supplement, alter or amend, or waive or release any of its rights and remedies under, any Franchise Agreement or (v) suffer or permit
the occurrence of continuance a default beyond any applicable cure period under any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved by Lender) if such default permits the franchiser to terminate or
cancel any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved by Lender). 
 (i)
Guarantor is not and shall not be a party to any Indebtedness other than (i) the Indebtedness evidenced by this Guaranty and (ii) the Indebtedness listed on Schedule III to the Credit Agreement, and Guarantor shall not incur
any additional Indebtedness on or secured by (including, without limitation, by any Lien, pledge, encumbrance or hypothecation of or on) any Hotel property owned by Guarantor, other than that Indebtedness contemplated on Schedules III
and IV of the Loan Agreement. 
 (j) Guarantor shall maintain its corporate existence and obtain and
maintain all rights, privileges, licenses, approvals, franchises, properties and assets necessary or desirable in the normal conduct of its business, and comply with all Contractual Obligations and Requirements of Law, in each case applicable to the
conduct of its business, except where the failure to so comply is not likely to have a material adverse effect on the business, operations, assets or financial or other condition of Guarantor. 
 (k) Guarantor shall pay or otherwise satisfy at or before maturity or before it becomes delinquent or accelerated, as the case may be, all
its Indebtedness (including taxes), except Indebtedness being contested in good faith by appropriate proceedings and for which provision is made to the satisfaction of Lender for the payment thereof in the event Guarantor is found to be obligated to
pay such Indebtedness and which Indebtedness is thereupon promptly paid by Guarantor. 
 (l) Guarantor shall keep proper books
of record and account in which full, true and correct entries in conformity with GAAP and all Requirements of Law shall be made of all dealings and transactions in relation to its business and activities. 
 (m) Guarantor shall not sell, lease, assign, transfer or otherwise dispose of any of its assets (other than obsolete or worn out
property), whether now owned or hereafter 

  

 7 

 
acquired, other than in the ordinary course of business and at fair market value, without the prior written consent of Lender. 
 12. This Guaranty shall be deemed to be made under and shall be governed by the laws of the State of North Carolina. 
 13. If any of the provisions of this Guaranty shall contravene or be held invalid under the laws of any jurisdiction, this Guaranty shall be construed as
if not containing those provisions and the rights and obligations of the parties hereto shall be construed and enforced accordingly. 
 [SIGNATURE ON NEXT PAGE] 
  

 8 

 Executed and sealed as of the day and year first above written. 
  

			
	APPLE SEVEN TEXAS LP, INC., a Virginia corporation
		
	By:	 	/s/ Justin G. Knight
	Name:	 	Justin G. Knight
	Title:	 	President

 GUARANTY 
 THIS GUARANTY (the “Guaranty”) is made and dated as of the 14th day of
December, 2006 by APPLE SEVEN SOUTHEAST GP, INC., a Virginia corporation (“Guarantor”). 
 RECITALS 
 A. Pursuant to that certain Loan Agreement of even date herewith between Apple REIT Seven, Inc. (the “Company”) and Wachovia Bank, National
Association (the “Lender”), (as amended, extended and replaced from time to time, the “Loan Agreement,” and with capitalized terms not otherwise defined herein used with the same meanings as in the Loan Agreement) the Lender has
agreed to extend credit to the Company, on the terms and subject to the conditions set forth therein. 
 B. As a condition precedent to the
effectiveness of the Loan Documents and pursuant to the terms of and as specifically required as a condition to the effectiveness of the Loan Agreement, Guarantor is required to execute and deliver to the Lender this Guaranty. 
 C. Guarantor is wholly-owned by Apple Seven Hospitality Ownership, Inc., which is wholly-owned by Apple Seven Hospitality, Inc., which is a wholly-owned
subsidiary of the Company, and thus will derive material benefit from the extension of credit by the Lender to the Company pursuant to the Loan Agreement. 
 NOW, THEREFORE, in consideration of the above Recitals and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, Guarantor hereby agrees as follows: 
 AGREEMENT 
 1. (a) Guarantor
hereby irrevocably and unconditionally guarantees the payment when due, upon maturity, acceleration or otherwise, of the Obligations, whether heretofore, now, or hereafter made, incurred or created, whether voluntary or involuntary and however
arising, absolute or contingent, liquidated or unliquidated, determined or undetermined, whether or not such Obligations are from time to time reduced, or extinguished and thereafter increased or incurred, whether Company may be liable individually
or jointly with others, whether or not recovery upon such Obligations may be or hereafter become barred by any statute of limitations, and whether or not such Obligations may be or hereafter become otherwise invalid or unenforceable. This Guaranty
is a guaranty of payment and not of collection. 
 (b) Notwithstanding anything to the contrary contained in subsection
(a) above, it is the intention of Guarantor and Lender that, in any proceeding involving the bankruptcy, reorganization, arrangement, adjustment of debts, relief of debtors, dissolution or insolvency or any similar proceeding with respect to
Guarantor or its assets, the amount of Guarantor’s obligations under this Guaranty shall be in, but not in excess of, the maximum 

 
amount thereof not subject to avoidance or recovery by operation of all applicable laws governing bankruptcy, reorganization, arrangement, adjustment of
debts, relief of debtors, dissolution, insolvency, fraudulent transfers or conveyances or other similar laws (including, without limitation, 11 U.S.C. Sections 547, 548 and 550 and other “avoidance” provisions of Title 11 of the United
States Code) (“Applicable Insolvency Laws”) after giving effect to subsection (c) below. To that end, but only in the event and to the extent that after giving effect to subsection (c) below Guarantor’s obligations under
this Guaranty or any payment made pursuant hereto would, but for the operation of the first sentence of this subsection (b), be subject to avoidance or recovery in any such proceeding under Applicable Insolvency Laws after giving effect to
subsection (c) below, the amount of Guarantor’s obligations under this Guaranty shall be limited to the largest amount which, after giving effect thereto, would not, under Applicable Insolvency Laws, render Guarantor’s obligations
under this Guaranty unenforceable or avoidable or otherwise subject to recovery under Applicable Insolvency Laws. To the extent any payment actually made by Guarantor pursuant to this Guaranty exceeds the limitation of the first sentence of this
subsection (b) and is otherwise subject to avoidance and recovery in any such proceeding under Applicable Insolvency Laws, the amount subject to avoidance shall in all events be limited to the amount by which such actual payment exceeds such
limitation and the obligations of Guarantor hereunder, as limited by the first sentence of this subsection (b), shall in all events remain in full force and effect and be fully enforceable against Guarantor. The first sentence of this subsection
(b) is intended solely to preserve the rights of Lender hereunder against Guarantor in such proceeding to the maximum extent permitted by Applicable Insolvency Laws and neither Guarantor, Company, any other guarantor nor any other Person shall
have any right or claim under such sentence that would not otherwise be available under Applicable Insolvency Laws in such proceeding. 
 (c) (i) To the extent Guarantor is required, by reason of its obligations hereunder, to pay to Lender an amount greater than the amount of value (as determined in accordance with Applicable Insolvency Laws)
actually made available to or for the benefit of Guarantor on account of the Loan Agreement, this Guaranty or any other Loan Document, Guarantor shall have an enforceable right of contribution against Company, and Company shall be liable for
repayment of the full amount of such excess payment. Subject only to the subordination provided in the following clause (ii), Guarantor further shall be subrogated to any and all rights of Lender against Company to the extent of such excess payment.

 (ii) Notwithstanding any payment or payments by Guarantor hereunder, or any set-off or application of funds of Guarantor by
Lender, or the receipt of any amounts by Lender with respect to any of the obligations of Guarantor hereunder, Guarantor shall not be entitled to be subrogated to any of the rights of Lender against Company or any other guarantors or against any
collateral security, if any, held by or for the benefit of Lender for the payment of the Obligations nor shall Guarantor seek any reimbursement from Company in respect of payments made by Guarantor in connection with the obligations of Guarantor
hereunder, until all amounts owing to Lender on account of the Obligations are paid in full and the Aggregate Commitment is terminated. If any amount shall be paid to Guarantor on account of such subrogation rights at any time when all of the
Obligations shall not have been paid in full, such amount shall be held by Guarantor in trust for Lender, segregated from other funds of Guarantor, and shall, forthwith upon receipt by Guarantor, be turned over to Lender in the exact 

  

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form received by Guarantor (duly endorsed by Guarantor to Lender, if required) to be applied against the Obligations, whether matured or unmatured, in such
order as set forth in the Loan Agreement. 
 2. Guarantor irrevocably and unconditionally guarantees the payment of the Obligations whether
or not due or payable by Company upon: (a) the dissolution, insolvency or business failure of, or any assignment for benefit of creditors by, or commencement of any bankruptcy, reorganization, arrangement, moratorium or other debtor relief
proceedings by or against, Company or Guarantor, or (b) the appointment of a receiver for, or the attachment, restraint of or making or levying of any order of court or legal process affecting, the property of Company or Guarantor, and
unconditionally promises to pay such Obligations to Lender, or order, on demand, in lawful money of the United States. 
 3. The liability of
Guarantor hereunder is exclusive and independent of any security for or other guaranty of the Obligations, whether executed by Guarantor or by any other party, and the liability of Guarantor hereunder is not affected or impaired by (a) any
direction of application of payment by Company or by any other party, or (b) any other guaranty, undertaking or maximum liability of Guarantor or of any other party as to the Obligations, or (c) any payment on or in reduction of any such
other guaranty or undertaking, or (d) any revocation or release of any obligations of any other guarantor of the guaranteed Obligations, or (e) any payment made to Lender on the Obligations which any of such Persons repay to Company
pursuant to court order in any bankruptcy, reorganization, arrangement, moratorium or other debtor relief proceeding, and Guarantor waives any right to the deferral or modification of Guarantor’s obligations hereunder by reason of any such
proceeding. 
 4. (a) The obligations of Guarantor hereunder are independent of the Obligations of Company, and a separate action or actions
may be brought and prosecuted against Guarantor whether or not action is brought against Company and whether or not Company be joined in any such action or actions. Guarantor waives, to the fullest extent permitted by law, the benefit of any statute
of limitations affecting its liability hereunder or the enforcement thereof. Any payment by Company or other circumstance which operates to toll any statute of limitations as to Company shall operate to toll the statute of limitations as to
Guarantor. 
 (b) All payments made by Guarantor under this Guaranty shall be made without set-off or counterclaim and free
and clear of and without deductions for any present or future taxes, fees, charges, withholdings or conditions of any nature (“Taxes”). Guarantor shall pay any such Taxes, including Taxes on any amounts so paid, and will promptly furnish
Lender with copies of any tax receipts or such other evidence of payment as Lender may require. However, Guarantor shall not be liable for any income tax liability arising under the Loan. 
 5. Guarantor authorizes Lender (whether or not after termination of this Guaranty), without notice or demand (except as shall be required by applicable
statute and cannot be waived), and without affecting or impairing its liability hereunder, from time to time to (a) renew, compromise, extend, increase, accelerate or otherwise change the time for payment of, or otherwise change the terms of,
the Obligations or any part thereof, including increase or decrease of the rate of interest thereon; (b) take and hold security for the payment of this Guaranty or the 

  

 3 

 
Obligations and exchange, enforce, waive and release any such security; (c) apply such security and direct the order or manner of sale thereof as
Lender, in its discretion may determine; and (d) release or substitute any one or more endorsers, guarantors, Company or other obligors. Lender may without notice to or the further consent of Company or Guarantor assign this Guaranty in whole
or in part to any person acquiring an interest in the Obligations. 
 6. It is not necessary for Lender to inquire into the capacity or power
of Company or the officers acting or purporting to act on its behalf, and Obligations made or created in reliance upon the professed exercise of such powers shall be guaranteed hereunder. 
 7. Guarantor waives any right to require Lender to (a) proceed against Company or any other party; (b) proceed against or exhaust any security
held from Company; or (c) pursue any other remedy in Lender’s power whatsoever. To this end, and without limiting the generality of the foregoing, Guarantor expressly waives any rights Guarantor might otherwise have had under the
provisions of North Carolina General Statutes §26-7 et seq. Guarantor waives any personal defense based on or arising out of any personal defense of Company other than payment in full of the Obligations, including, without limitation,
any defense based on or arising out of the disability of Company, or the invalidity or unenforceability of the Obligations or any part thereof from any cause, or the cessation from any cause of the liability of Company other than payment in full of
the Obligations. Lender may, at its election, foreclose on any security held for the guaranteed Obligations by one or more judicial or nonjudicial sales, or exercise any other right or remedy Lender may have against Company, or any security, without
affecting or impairing in any way the liability of Guarantor hereunder except to the extent the Obligations have been paid. Guarantor waives any defense arising out of any such election, even though such election operates to impair or extinguish any
right of reimbursement or subrogation or other right or remedy of Guarantor against Company or any security. Guarantor hereby waives, until such time as all of its obligations under this Guaranty have been performed, discharged or terminated, and
all Obligations under the Loan have been performed, discharged or terminated, any claim or other rights which Guarantor may now have or may hereafter acquire against the Company or any other guarantor of all or any of the guaranteed Obligations that
arise from the existence or performance of Guarantor’s obligations under this Guaranty or any other of the Loan Documents (as such claims and rights being referred to as the “Guarantor’s Conditional Rights”), including, without
limitation, any right of subrogation, reimbursement, exoneration, contribution, or indemnification, or any right to participate in any claim or remedy which the Lender has against the Company or any collateral which the Lender now has or hereafter
acquire for the Obligations, whether or not such claim, remedy or right arises in equity or under contract, statute or common law, by any payment made hereunder or otherwise, including, without limitation, the right to take or receive from the
Company, directly or indirectly, in cash or other property or setoff or in any other manner, payment or security on account of such claim or other rights. If, notwithstanding the foregoing provisions, any amount shall be paid to Guarantor on account
of Guarantor’s Conditional Rights and either (a) such amount is paid to Guarantor at any time when the Obligations shall not have been paid or performed in full, or (b) regardless of when such amount is paid to Guarantor any payment
made by Company to the Lender is at any time determined to be a preferential payment, then such amount paid to Guarantor shall be deemed to be held in trust for the benefit of the Lender and shall forthwith be paid to the Lender to be credited and
applied upon the Obligations, whether matured or unmatured, in such order 

  

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and manner as the Lender shall determine. To the extent that any of the provisions of this Paragraph shall not be enforceable, Guarantor agrees that until
such time as the Obligations have been paid and performed in full and the period of time has expired during which any payment made by the Company or Guarantor to the Lender may be determined to be a preferential payment, Guarantor’s Conditional
Rights to the extent not validly waived shall be subordinate to the Lender’s right to full payment and performance of the Obligations and Guarantor shall not seek to enforce Guarantor’s Conditional Rights during such period. Guarantor
waives all presentments, demands for performance, protests and notices, including, without limitation, notices of nonperformance, notices of protest, notices of dishonor, notices of acceptance of this Guaranty, and notices of the existence, creation
or incurring of new or additional Obligations. Guarantor assumes all responsibility for being and keeping itself informed of Company’s financial condition and assets, and of all other circumstances bearing upon the risk of nonpayment of the
Obligations and the nature, scope and extent of the risks which Guarantor assumes and incurs hereunder, and agrees that Lender shall have no duty to advise Guarantor of information known to any of them regarding such circumstances or risks.

 8. In addition to the Obligations, Guarantor agrees to pay reasonable attorneys’ fees and all other costs and expenses incurred by
Lender in enforcing this Guaranty in any action or proceeding arising out of, or relating to, this Guaranty. This Guaranty and the liability and obligations of Guarantor hereunder are binding upon Guarantor and its successors and assigns, and this
Guaranty inures to the benefit of and is enforceable by Lender and its successors, transferees, and assigns. 
 9. No right or power of
Lender hereunder shall be deemed to have been waived by any act or conduct on the part of the Lender, or by any neglect to exercise such right or power, or by any delay in so doing; and every right or power shall continue in full force and effect
until specifically waived or released by an instrument in writing executed by Lender. 
 10. Guarantor agrees to execute any and all further
documents, instruments and agreements as Lender from time to time reasonably requests to evidence Guarantor’s obligations hereunder. 
 11. Guarantor hereby represents and warrants and agrees that: 
 (a) Guarantor: (1) is duly organized, validly
existing and in good standing as a corporation under the laws of the Commonwealth of Virginia and is qualified to do business in each other jurisdiction where its ownership of property or conduct of business requires such qualification and where
failure to qualify could have a material adverse effect on Guarantor or its property or business or on Guarantor’s ability to pay or perform its obligations hereunder, (2) has the corporate power and authority and the legal right to own
and operate its property and to conduct business in the manner in which it does and proposes to do so, (3) is in compliance with all Requirements of Law and Contractual Obligations to the extent that failure to so comply could have a material
adverse effect on Guarantor or the Company or any of their respective property or business or on the ability of Company to pay or perform the Obligations or the ability of Guarantor to pay or 

  

 5 

 
perform Guarantor’s obligations hereunder, and (4) has reviewed and approved the Loan Documents. 
 (b) Guarantor has the corporate power and authority and the legal right to execute, deliver and perform the Loan Documents to which it is
a party and has taken all necessary corporate action to authorize the execution, delivery and performance of this Guaranty. The Loan Documents to which Guarantor is a party have been duly executed and delivered on behalf of Guarantor and constitute
legal, valid and binding obligations of Guarantor enforceable against Guarantor in accordance with their respective terms, subject to the effect of applicable bankruptcy and other similar laws affecting the rights of creditors generally and the
effect of equitable principles whether applied in an action at law or a suit in equity. 
 (c) Guarantor has not made, and
will not make, any agreement which (i) prohibits or restricts the pledging or creation of lien upon the Owned Hotels, if any, which Guarantor owns or (ii) creates a lien on the Owned Hotels, if any, which Guarantor owns (other than those
agreements granting the Liens noted on Schedules III and IV to the Loan Agreement). 
 (d) The
execution, delivery and performance of this Guaranty will not violate any Requirement of Law or any Contractual Obligations of Guarantor the violation of which could have a material adverse effect on the business, operations, assets or financial or
other condition of Guarantor. 
 (e) Guarantor is not an “investment company” or a company “controlled” by
an “investment company” within the meaning of the Investment Company Act of 1940, as amended. 
 (f) Neither
Guarantor nor any of the Subsidiaries of Guarantor, if any, is engaged or will engage, principally or as one of its important activities, in the business of extending credit for the purpose of “purchasing” or “carrying” any
“margin stock” within the respective meanings of such terms under Regulation U. No part of the proceeds of any Loan made under the Loan Agreement will be used, directly or indirectly, for “purchasing” or “carrying”
“margin stock” as so defined or for any purpose which violates, or which would be inconsistent with, the applicable provisions of the Regulations of the Board of Governors of the Federal Reserve System. 
 (g) No consent, approval, authorization of, or registration, declaration or filing with, any Governmental Authority is required on the
part of Guarantor in connection with the execution and delivery of the Loan Documents to which Guarantor is a party or the performance of or compliance with the terms, provisions and conditions hereof or thereof. 
 (h) To the extent of Guarantor’s actual control and knowledge, Guarantor shall (i) operate its hotels, if any, in material
compliance with the terms of any Franchise Agreements in effect as of the date hereof; (ii) promptly perform and observe (or cause to 

  

 6 

 
be performed or observed) all of the material covenants required to be performed and observed by it under the Franchise Agreements and do all things
necessary to preserve and to keep unimpaired its material rights thereunder; (iii) promptly notify Lender of any event of default under the Franchise Agreements of which it is aware; and (iv) promptly enforce the performance and observance
of all of the covenants required to be performed and observed by the franchisor under the Franchise Agreements. To the extent of Guarantor’s actual control and knowledge, without Lender’s prior consent, Guarantor shall not, and shall not
permit the lessee under any percentage lease or any manager to: (i) surrender, terminate or cancel any Franchise Agreement; (ii) reduce or consent to the reduction of the term of any Franchise Agreement; (iii) increase or consent to
the increase of the amount of any charges under any Franchise Agreement; (iv) otherwise modify, change, supplement, alter or amend, or waive or release any of its rights and remedies under, any Franchise Agreement or (v) suffer or permit
the occurrence of continuance a default beyond any applicable cure period under any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved by Lender) if such default permits the franchiser to terminate or
cancel any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved by Lender). 
 (i)
Guarantor is not and shall not be a party to any Indebtedness other than (i) the Indebtedness evidenced by this Guaranty and (ii) the Indebtedness listed on Schedule III to the Credit Agreement, and Guarantor shall not incur
any additional Indebtedness on or secured by (including, without limitation, by any Lien, pledge, encumbrance or hypothecation of or on) any Hotel property owned by Guarantor, other than that Indebtedness contemplated on Schedules III
and IV of the Loan Agreement. 
 (j) Guarantor shall maintain its corporate existence and obtain and
maintain all rights, privileges, licenses, approvals, franchises, properties and assets necessary or desirable in the normal conduct of its business, and comply with all Contractual Obligations and Requirements of Law, in each case applicable to the
conduct of its business, except where the failure to so comply is not likely to have a material adverse effect on the business, operations, assets or financial or other condition of Guarantor. 
 (k) Guarantor shall pay or otherwise satisfy at or before maturity or before it becomes delinquent or accelerated, as the case may be, all
its Indebtedness (including taxes), except Indebtedness being contested in good faith by appropriate proceedings and for which provision is made to the satisfaction of Lender for the payment thereof in the event Guarantor is found to be obligated to
pay such Indebtedness and which Indebtedness is thereupon promptly paid by Guarantor. 
 (l) Guarantor shall keep proper books
of record and account in which full, true and correct entries in conformity with GAAP and all Requirements of Law shall be made of all dealings and transactions in relation to its business and activities. 
 (m) Guarantor shall not sell, lease, assign, transfer or otherwise dispose of any of its assets (other than obsolete or worn out
property), whether now owned or hereafter 

  

 7 

 
acquired, other than in the ordinary course of business and at fair market value, without the prior written consent of Lender. 
 12. This Guaranty shall be deemed to be made under and shall be governed by the laws of the State of North Carolina. 
 13. If any of the provisions of this Guaranty shall contravene or be held invalid under the laws of any jurisdiction, this Guaranty shall be construed as
if not containing those provisions and the rights and obligations of the parties hereto shall be construed and enforced accordingly. 
 [SIGNATURE ON NEXT PAGE] 
  

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 Executed and sealed as of the day and year first above written. 
  

			
	APPLE SEVEN SOUTHEAST GP, INC., a Virginia corporation
		
	By:	 	/s/ Justin G. Knight
	Name:	 	Justin G. Knight
	Title:	 	President

 GUARANTY 
 THIS GUARANTY (the “Guaranty”) is made and dated as of the 14th day
of December, 2006 by APPLE SEVEN SOUTHEAST LP, INC., a Virginia corporation (“Guarantor”). 
 RECITALS 
 A. Pursuant to that certain Loan Agreement of even date herewith between Apple REIT Seven, Inc. (the “Company”) and Wachovia Bank, National
Association (the “Lender”), (as amended, extended and replaced from time to time, the “Loan Agreement,” and with capitalized terms not otherwise defined herein used with the same meanings as in the Loan Agreement) the Lender has
agreed to extend credit to the Company, on the terms and subject to the conditions set forth therein. 
 B. As a condition precedent to the
effectiveness of the Loan Documents and pursuant to the terms of and as specifically required as a condition to the effectiveness of the Loan Agreement, Guarantor is required to execute and deliver to the Lender this Guaranty. 
 C. Guarantor is wholly-owned by Apple Seven Hospitality Ownership, Inc., which is wholly-owned by Apple Seven Hospitality, Inc., which is a wholly-owned
subsidiary of the Company, and thus will derive material benefit from the extension of credit by the Lender to the Company pursuant to the Loan Agreement. 
 NOW, THEREFORE, in consideration of the above Recitals and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, Guarantor hereby agrees as follows: 
 AGREEMENT 
 1. (a) Guarantor
hereby irrevocably and unconditionally guarantees the payment when due, upon maturity, acceleration or otherwise, of the Obligations, whether heretofore, now, or hereafter made, incurred or created, whether voluntary or involuntary and however
arising, absolute or contingent, liquidated or unliquidated, determined or undetermined, whether or not such Obligations are from time to time reduced, or extinguished and thereafter increased or incurred, whether Company may be liable individually
or jointly with others, whether or not recovery upon such Obligations may be or hereafter become barred by any statute of limitations, and whether or not such Obligations may be or hereafter become otherwise invalid or unenforceable. This Guaranty
is a guaranty of payment and not of collection. 
 (b) Notwithstanding anything to the contrary contained in subsection
(a) above, it is the intention of Guarantor and Lender that, in any proceeding involving the bankruptcy, reorganization, arrangement, adjustment of debts, relief of debtors, dissolution or insolvency or any similar proceeding with respect to
Guarantor or its assets, the amount of Guarantor’s obligations under this Guaranty shall be in, but not in excess of, the maximum 

 
amount thereof not subject to avoidance or recovery by operation of all applicable laws governing bankruptcy, reorganization, arrangement, adjustment of
debts, relief of debtors, dissolution, insolvency, fraudulent transfers or conveyances or other similar laws (including, without limitation, 11 U.S.C. Sections 547, 548 and 550 and other “avoidance” provisions of Title 11 of the United
States Code) (“Applicable Insolvency Laws”) after giving effect to subsection (c) below. To that end, but only in the event and to the extent that after giving effect to subsection (c) below Guarantor’s obligations under
this Guaranty or any payment made pursuant hereto would, but for the operation of the first sentence of this subsection (b), be subject to avoidance or recovery in any such proceeding under Applicable Insolvency Laws after giving effect to
subsection (c) below, the amount of Guarantor’s obligations under this Guaranty shall be limited to the largest amount which, after giving effect thereto, would not, under Applicable Insolvency Laws, render Guarantor’s obligations
under this Guaranty unenforceable or avoidable or otherwise subject to recovery under Applicable Insolvency Laws. To the extent any payment actually made by Guarantor pursuant to this Guaranty exceeds the limitation of the first sentence of this
subsection (b) and is otherwise subject to avoidance and recovery in any such proceeding under Applicable Insolvency Laws, the amount subject to avoidance shall in all events be limited to the amount by which such actual payment exceeds such
limitation and the obligations of Guarantor hereunder, as limited by the first sentence of this subsection (b), shall in all events remain in full force and effect and be fully enforceable against Guarantor. The first sentence of this subsection
(b) is intended solely to preserve the rights of Lender hereunder against Guarantor in such proceeding to the maximum extent permitted by Applicable Insolvency Laws and neither Guarantor, Company, any other guarantor nor any other Person shall
have any right or claim under such sentence that would not otherwise be available under Applicable Insolvency Laws in such proceeding. 
 (c) (i) To the extent Guarantor is required, by reason of its obligations hereunder, to pay to Lender an amount greater than the amount of value (as determined in accordance with Applicable Insolvency Laws)
actually made available to or for the benefit of Guarantor on account of the Loan Agreement, this Guaranty or any other Loan Document, Guarantor shall have an enforceable right of contribution against Company, and Company shall be liable for
repayment of the full amount of such excess payment. Subject only to the subordination provided in the following clause (ii), Guarantor further shall be subrogated to any and all rights of Lender against Company to the extent of such excess payment.

 (ii) Notwithstanding any payment or payments by Guarantor hereunder, or any set-off or application of funds of Guarantor by
Lender, or the receipt of any amounts by Lender with respect to any of the obligations of Guarantor hereunder, Guarantor shall not be entitled to be subrogated to any of the rights of Lender against Company or any other guarantors or against any
collateral security, if any, held by or for the benefit of Lender for the payment of the Obligations nor shall Guarantor seek any reimbursement from Company in respect of payments made by Guarantor in connection with the obligations of Guarantor
hereunder, until all amounts owing to Lender on account of the Obligations are paid in full and the Aggregate Commitment is terminated. If any amount shall be paid to Guarantor on account of such subrogation rights at any time when all of the
Obligations shall not have been paid in full, such amount shall be held by Guarantor in trust for Lender, segregated from other funds of Guarantor, and shall, forthwith upon receipt by Guarantor, be turned over to Lender in the exact 

  

 2 

 
form received by Guarantor (duly endorsed by Guarantor to Lender, if required) to be applied against the Obligations, whether matured or unmatured, in such
order as set forth in the Loan Agreement. 
 2. Guarantor irrevocably and unconditionally guarantees the payment of the Obligations whether
or not due or payable by Company upon: (a) the dissolution, insolvency or business failure of, or any assignment for benefit of creditors by, or commencement of any bankruptcy, reorganization, arrangement, moratorium or other debtor relief
proceedings by or against, Company or Guarantor, or (b) the appointment of a receiver for, or the attachment, restraint of or making or levying of any order of court or legal process affecting, the property of Company or Guarantor, and
unconditionally promises to pay such Obligations to Lender, or order, on demand, in lawful money of the United States. 
 3. The liability of
Guarantor hereunder is exclusive and independent of any security for or other guaranty of the Obligations, whether executed by Guarantor or by any other party, and the liability of Guarantor hereunder is not affected or impaired by (a) any
direction of application of payment by Company or by any other party, or (b) any other guaranty, undertaking or maximum liability of Guarantor or of any other party as to the Obligations, or (c) any payment on or in reduction of any such
other guaranty or undertaking, or (d) any revocation or release of any obligations of any other guarantor of the guaranteed Obligations, or (e) any payment made to Lender on the Obligations which any of such Persons repay to Company
pursuant to court order in any bankruptcy, reorganization, arrangement, moratorium or other debtor relief proceeding, and Guarantor waives any right to the deferral or modification of Guarantor’s obligations hereunder by reason of any such
proceeding. 
 4. (a) The obligations of Guarantor hereunder are independent of the Obligations of Company, and a separate action or actions
may be brought and prosecuted against Guarantor whether or not action is brought against Company and whether or not Company be joined in any such action or actions. Guarantor waives, to the fullest extent permitted by law, the benefit of any statute
of limitations affecting its liability hereunder or the enforcement thereof. Any payment by Company or other circumstance which operates to toll any statute of limitations as to Company shall operate to toll the statute of limitations as to
Guarantor. 
 (b) All payments made by Guarantor under this Guaranty shall be made without set-off or counterclaim and free
and clear of and without deductions for any present or future taxes, fees, charges, withholdings or conditions of any nature (“Taxes”). Guarantor shall pay any such Taxes, including Taxes on any amounts so paid, and will promptly furnish
Lender with copies of any tax receipts or such other evidence of payment as Lender may require. However, Guarantor shall not be liable for any income tax liability arising under the Loan. 
 5. Guarantor authorizes Lender (whether or not after termination of this Guaranty), without notice or demand (except as shall be required by applicable
statute and cannot be waived), and without affecting or impairing its liability hereunder, from time to time to (a) renew, compromise, extend, increase, accelerate or otherwise change the time for payment of, or otherwise change the terms of,
the Obligations or any part thereof, including increase or decrease of the rate of interest thereon; (b) take and hold security for the payment of this Guaranty or the 

  

 3 

 
Obligations and exchange, enforce, waive and release any such security; (c) apply such security and direct the order or manner of sale thereof as
Lender, in its discretion may determine; and (d) release or substitute any one or more endorsers, guarantors, Company or other obligors. Lender may without notice to or the further consent of Company or Guarantor assign this Guaranty in whole
or in part to any person acquiring an interest in the Obligations. 
 6. It is not necessary for Lender to inquire into the capacity or power
of Company or the officers acting or purporting to act on its behalf, and Obligations made or created in reliance upon the professed exercise of such powers shall be guaranteed hereunder. 
 7. Guarantor waives any right to require Lender to (a) proceed against Company or any other party; (b) proceed against or exhaust any security
held from Company; or (c) pursue any other remedy in Lender’s power whatsoever. To this end, and without limiting the generality of the foregoing, Guarantor expressly waives any rights Guarantor might otherwise have had under the
provisions of North Carolina General Statutes §26-7 et seq.. Guarantor waives any personal defense based on or arising out of any personal defense of Company other than payment in full of the Obligations, including, without limitation,
any defense based on or arising out of the disability of Company, or the invalidity or unenforceability of the Obligations or any part thereof from any cause, or the cessation from any cause of the liability of Company other than payment in full of
the Obligations. Lender may, at its election, foreclose on any security held for the guaranteed Obligations by one or more judicial or nonjudicial sales, or exercise any other right or remedy Lender may have against Company, or any security, without
affecting or impairing in any way the liability of Guarantor hereunder except to the extent the Obligations have been paid. Guarantor waives any defense arising out of any such election, even though such election operates to impair or extinguish any
right of reimbursement or subrogation or other right or remedy of Guarantor against Company or any security. Guarantor hereby waives, until such time as all of its obligations under this Guaranty have been performed, discharged or terminated, and
all Obligations under the Loan have been performed, discharged or terminated, any claim or other rights which Guarantor may now have or may hereafter acquire against the Company or any other guarantor of all or any of the guaranteed Obligations that
arise from the existence or performance of Guarantor’s obligations under this Guaranty or any other of the Loan Documents (as such claims and rights being referred to as the “Guarantor’s Conditional Rights”), including, without
limitation, any right of subrogation, reimbursement, exoneration, contribution, or indemnification, or any right to participate in any claim or remedy which the Lender has against the Company or any collateral which the Lender now has or hereafter
acquire for the Obligations, whether or not such claim, remedy or right arises in equity or under contract, statute or common law, by any payment made hereunder or otherwise, including, without limitation, the right to take or receive from the
Company, directly or indirectly, in cash or other property or setoff or in any other manner, payment or security on account of such claim or other rights. If, notwithstanding the foregoing provisions, any amount shall be paid to Guarantor on account
of Guarantor’s Conditional Rights and either (a) such amount is paid to Guarantor at any time when the Obligations shall not have been paid or performed in full, or (b) regardless of when such amount is paid to Guarantor any payment
made by Company to the Lender is at any time determined to be a preferential payment, then such amount paid to Guarantor shall be deemed to be held in trust for the benefit of the Lender and shall forthwith be paid to the Lender to be credited and
applied upon the Obligations, whether matured or unmatured, in such order 

  

 4 

 
and manner as the Lender shall determine. To the extent that any of the provisions of this Paragraph shall not be enforceable, Guarantor agrees that until
such time as the Obligations have been paid and performed in full and the period of time has expired during which any payment made by the Company or Guarantor to the Lender may be determined to be a preferential payment, Guarantor’s Conditional
Rights to the extent not validly waived shall be subordinate to the Lender’s right to full payment and performance of the Obligations and Guarantor shall not seek to enforce Guarantor’s Conditional Rights during such period. Guarantor
waives all presentments, demands for performance, protests and notices, including, without limitation, notices of nonperformance, notices of protest, notices of dishonor, notices of acceptance of this Guaranty, and notices of the existence, creation
or incurring of new or additional Obligations. Guarantor assumes all responsibility for being and keeping itself informed of Company’s financial condition and assets, and of all other circumstances bearing upon the risk of nonpayment of the
Obligations and the nature, scope and extent of the risks which Guarantor assumes and incurs hereunder, and agrees that Lender shall have no duty to advise Guarantor of information known to any of them regarding such circumstances or risks.

 8. In addition to the Obligations, Guarantor agrees to pay reasonable attorneys’ fees and all other costs and expenses incurred by
Lender in enforcing this Guaranty in any action or proceeding arising out of, or relating to, this Guaranty. This Guaranty and the liability and obligations of Guarantor hereunder are binding upon Guarantor and its successors and assigns, and this
Guaranty inures to the benefit of and is enforceable by Lender and its successors, transferees, and assigns. 
 9. No right or power of
Lender hereunder shall be deemed to have been waived by any act or conduct on the part of the Lender, or by any neglect to exercise such right or power, or by any delay in so doing; and every right or power shall continue in full force and effect
until specifically waived or released by an instrument in writing executed by Lender. 
 10. Guarantor agrees to execute any and all further
documents, instruments and agreements as Lender from time to time reasonably requests to evidence Guarantor’s obligations hereunder. 
 11. Guarantor hereby represents and warrants and agrees that: 
 (a) Guarantor: (1) is duly organized, validly
existing and in good standing as a corporation under the laws of the Commonwealth of Virginia and is qualified to do business in each other jurisdiction where its ownership of property or conduct of business requires such qualification and where
failure to qualify could have a material adverse effect on Guarantor or its property or business or on Guarantor’s ability to pay or perform its obligations hereunder, (2) has the corporate power and authority and the legal right to own
and operate its property and to conduct business in the manner in which it does and proposes to do so, (3) is in compliance with all Requirements of Law and Contractual Obligations to the extent that failure to so comply could have a material
adverse effect on Guarantor or the Company or any of their respective property or business or on the ability of Company to pay or perform the Obligations or the ability of Guarantor to pay or 

  

 5 

 
perform Guarantor’s obligations hereunder, and (4) has reviewed and approved the Loan Documents. 
 (b) Guarantor has the corporate power and authority and the legal right to execute, deliver and perform the Loan Documents to which it is
a party and has taken all necessary corporate action to authorize the execution, delivery and performance of this Guaranty. The Loan Documents to which Guarantor is a party have been duly executed and delivered on behalf of Guarantor and constitute
legal, valid and binding obligations of Guarantor enforceable against Guarantor in accordance with their respective terms, subject to the effect of applicable bankruptcy and other similar laws affecting the rights of creditors generally and the
effect of equitable principles whether applied in an action at law or a suit in equity. 
 (c) Guarantor has not made, and
will not make, any agreement which (i) prohibits or restricts the pledging or creation of lien upon the Owned Hotels, if any, which Guarantor owns or (ii) creates a lien on the Owned Hotels, if any, which Guarantor owns (other than those
agreements granting the Liens noted on Schedules III and IV to the Loan Agreement). 
 (d) The
execution, delivery and performance of this Guaranty will not violate any Requirement of Law or any Contractual Obligations of Guarantor the violation of which could have a material adverse effect on the business, operations, assets or financial or
other condition of Guarantor. 
 (e) Guarantor is not an “investment company” or a company “controlled” by
an “investment company” within the meaning of the Investment Company Act of 1940, as amended. 
 (f) Neither
Guarantor nor any of the Subsidiaries of Guarantor, if any, is engaged or will engage, principally or as one of its important activities, in the business of extending credit for the purpose of “purchasing” or “carrying” any
“margin stock” within the respective meanings of such terms under Regulation U. No part of the proceeds of any Loan made under the Loan Agreement will be used, directly or indirectly, for “purchasing” or “carrying”
“margin stock” as so defined or for any purpose which violates, or which would be inconsistent with, the applicable provisions of the Regulations of the Board of Governors of the Federal Reserve System. 
 (g) No consent, approval, authorization of, or registration, declaration or filing with, any Governmental Authority is required on the
part of Guarantor in connection with the execution and delivery of the Loan Documents to which Guarantor is a party or the performance of or compliance with the terms, provisions and conditions hereof or thereof. 
 (h) To the extent of Guarantor’s actual control and knowledge, Guarantor shall (i) operate its hotels, if any, in material
compliance with the terms of any Franchise Agreements in effect as of the date hereof; (ii) promptly perform and observe (or cause to 

  

 6 

 
be performed or observed) all of the material covenants required to be performed and observed by it under the Franchise Agreements and do all things
necessary to preserve and to keep unimpaired its material rights thereunder; (iii) promptly notify Lender of any event of default under the Franchise Agreements of which it is aware; and (iv) promptly enforce the performance and observance
of all of the covenants required to be performed and observed by the franchisor under the Franchise Agreements. To the extent of Guarantor’s actual control and knowledge, without Lender’s prior consent, Guarantor shall not, and shall not
permit the lessee under any percentage lease or any manager to: (i) surrender, terminate or cancel any Franchise Agreement; (ii) reduce or consent to the reduction of the term of any Franchise Agreement; (iii) increase or consent to
the increase of the amount of any charges under any Franchise Agreement; (iv) otherwise modify, change, supplement, alter or amend, or waive or release any of its rights and remedies under, any Franchise Agreement or (v) suffer or permit
the occurrence of continuance a default beyond any applicable cure period under any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved by Lender) if such default permits the franchiser to terminate or
cancel any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved by Lender). 
 (i)
Guarantor is not and shall not be a party to any Indebtedness other than (i) the Indebtedness evidenced by this Guaranty and (ii) the Indebtedness listed on Schedule III to the Credit Agreement, and Guarantor shall not incur
any additional Indebtedness on or secured by (including, without limitation, by any Lien, pledge, encumbrance or hypothecation of or on) any Hotel property owned by Guarantor, other than that Indebtedness contemplated on Schedules III
and IV of the Loan Agreement. 
 (j) Guarantor shall maintain its corporate existence and obtain and
maintain all rights, privileges, licenses, approvals, franchises, properties and assets necessary or desirable in the normal conduct of its business, and comply with all Contractual Obligations and Requirements of Law, in each case applicable to the
conduct of its business, except where the failure to so comply is not likely to have a material adverse effect on the business, operations, assets or financial or other condition of Guarantor. 
 (k) Guarantor shall pay or otherwise satisfy at or before maturity or before it becomes delinquent or accelerated, as the case may be, all
its Indebtedness (including taxes), except Indebtedness being contested in good faith by appropriate proceedings and for which provision is made to the satisfaction of Lender for the payment thereof in the event Guarantor is found to be obligated to
pay such Indebtedness and which Indebtedness is thereupon promptly paid by Guarantor. 
 (l) Guarantor shall keep proper books
of record and account in which full, true and correct entries in conformity with GAAP and all Requirements of Law shall be made of all dealings and transactions in relation to its business and activities. 
 (m) Guarantor shall not sell, lease, assign, transfer or otherwise dispose of any of its assets (other than obsolete or worn out
property), whether now owned or hereafter 

  

 7 

 
acquired, other than in the ordinary course of business and at fair market value, without the prior written consent of Lender. 
 12. This Guaranty shall be deemed to be made under and shall be governed by the laws of the State of North Carolina. 
 13. If any of the provisions of this Guaranty shall contravene or be held invalid under the laws of any jurisdiction, this Guaranty shall be construed as
if not containing those provisions and the rights and obligations of the parties hereto shall be construed and enforced accordingly. 
 [SIGNATURE ON NEXT PAGE] 
  

 8 

 Executed and sealed as of the day and year first above written. 
  

			
	APPLE SEVEN SOUTHEAST LP. INC., a Virginia corporation
		
	By:	 	/s/ Justin G. Knight
	Name:	 	Justin G. Knight
	Title:	 	President

 GUARANTY 
 THIS GUARANTY (the “Guaranty”) is made and dated as of the 14th day of
December, 2006 by APPLE SEVEN HOSPITALITY TEXAS, L.P., a Virginia limited partnership (“Guarantor”). 
 RECITALS 

A. Pursuant to that certain Loan Agreement of even date herewith between Apple REIT Seven, Inc. (the “Company”) and Wachovia Bank, National
Association (the “Lender”), (as amended, extended and replaced from time to time, the “Loan Agreement,” and with capitalized terms not otherwise defined herein used with the same meanings as in the Loan Agreement) the Lender has
agreed to extend credit to the Company, on the terms and subject to the conditions set forth therein. 
 B. As a condition precedent to the
effectiveness of the Loan Documents and pursuant to the terms of and as specifically required as a condition to the effectiveness of the Loan Agreement, Guarantor is required to execute and deliver to the Lender this Guaranty. 
 C. Guarantor is wholly-owned by Apple Seven Texas GP, Inc. and Apple Seven Texas LP, Inc., each of which is wholly-owned by Apple Seven Hospitality
Ownership, Inc., which is wholly-owned by Apple Seven Hospitality, Inc., which is a wholly-owned subsidiary of the Company, and thus will derive material benefit from the extension of credit by the Lender to the Company pursuant to the Loan
Agreement. 
 NOW, THEREFORE, in consideration of the above Recitals and for other good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, Guarantor hereby agrees as follows: 
 AGREEMENT 
 1. (a) Guarantor hereby irrevocably and unconditionally guarantees the payment when due, upon maturity, acceleration or otherwise, of the
Obligations, whether heretofore, now, or hereafter made, incurred or created, whether voluntary or involuntary and however arising, absolute or contingent, liquidated or unliquidated, determined or undetermined, whether or not such Obligations are
from time to time reduced, or extinguished and thereafter increased or incurred, whether Company may be liable individually or jointly with others, whether or not recovery upon such Obligations may be or hereafter become barred by any statute of
limitations, and whether or not such Obligations may be or hereafter become otherwise invalid or unenforceable. This Guaranty is a guaranty of payment and not of collection. 
 (b) Notwithstanding anything to the contrary contained in subsection (a) above, it is the intention of Guarantor and Lender that, in
any proceeding involving the bankruptcy, reorganization, arrangement, adjustment of debts, relief of debtors, dissolution or insolvency or any similar proceeding with respect to Guarantor or its assets, the amount of 

 
Guarantor’s obligations under this Guaranty shall be in, but not in excess of, the maximum amount thereof not subject to avoidance or recovery by
operation of all applicable laws governing bankruptcy, reorganization, arrangement, adjustment of debts, relief of debtors, dissolution, insolvency, fraudulent transfers or conveyances or other similar laws (including, without limitation, 11 U.S.C.
Sections 547, 548 and 550 and other “avoidance” provisions of Title 11 of the United States Code) (“Applicable Insolvency Laws”) after giving effect to subsection (c) below. To that end, but only in the event and to the
extent that after giving effect to subsection (c) below Guarantor’s obligations under this Guaranty or any payment made pursuant hereto would, but for the operation of the first sentence of this subsection (b), be subject to avoidance or
recovery in any such proceeding under Applicable Insolvency Laws after giving effect to subsection (c) below, the amount of Guarantor’s obligations under this Guaranty shall be limited to the largest amount which, after giving effect
thereto, would not, under Applicable Insolvency Laws, render Guarantor’s obligations under this Guaranty unenforceable or avoidable or otherwise subject to recovery under Applicable Insolvency Laws. To the extent any payment actually made by
Guarantor pursuant to this Guaranty exceeds the limitation of the first sentence of this subsection (b) and is otherwise subject to avoidance and recovery in any such proceeding under Applicable Insolvency Laws, the amount subject to avoidance
shall in all events be limited to the amount by which such actual payment exceeds such limitation and the obligations of Guarantor hereunder, as limited by the first sentence of this subsection (b), shall in all events remain in full force and
effect and be fully enforceable against Guarantor. The first sentence of this subsection (b) is intended solely to preserve the rights of Lender hereunder against Guarantor in such proceeding to the maximum extent permitted by Applicable
Insolvency Laws and neither Guarantor, Company, any other guarantor nor any other Person shall have any right or claim under such sentence that would not otherwise be available under Applicable Insolvency Laws in such proceeding. 
 (c) (i) To the extent Guarantor is required, by reason of its obligations hereunder, to pay to Lender an amount greater than the
amount of value (as determined in accordance with Applicable Insolvency Laws) actually made available to or for the benefit of Guarantor on account of the Loan Agreement, this Guaranty or any other Loan Document, Guarantor shall have an enforceable
right of contribution against Company, and Company shall be liable for repayment of the full amount of such excess payment. Subject only to the subordination provided in the following clause (ii), Guarantor further shall be subrogated to any and all
rights of Lender against Company to the extent of such excess payment. 
 (ii) Notwithstanding any payment or payments by
Guarantor hereunder, or any set-off or application of funds of Guarantor by Lender, or the receipt of any amounts by Lender with respect to any of the obligations of Guarantor hereunder, Guarantor shall not be entitled to be subrogated to any of the
rights of Lender against Company or any other guarantors or against any collateral security, if any, held by or for the benefit of Lender for the payment of the Obligations nor shall Guarantor seek any reimbursement from Company in respect of
payments made by Guarantor in connection with the obligations of Guarantor hereunder, until all amounts owing to Lender on account of the Obligations are paid in full and the Aggregate Commitment is terminated. If any amount shall be paid to
Guarantor on account of such subrogation rights at any time when all of the Obligations shall not have been paid in full, such amount shall be held by Guarantor in trust for Lender, segregated from other funds of 

  

 2 

 
Guarantor, and shall, forthwith upon receipt by Guarantor, be turned over to Lender in the exact form received by Guarantor (duly endorsed by Guarantor to
Lender, if required) to be applied against the Obligations, whether matured or unmatured, in such order as set forth in the Loan Agreement. 
 2. Guarantor irrevocably and unconditionally guarantees the payment of the Obligations whether or not due or payable by Company upon: (a) the dissolution, insolvency or business failure of, or any assignment for benefit of creditors
by, or commencement of any bankruptcy, reorganization, arrangement, moratorium or other debtor relief proceedings by or against, Company or Guarantor, or (b) the appointment of a receiver for, or the attachment, restraint of or making or
levying of any order of court or legal process affecting, the property of Company or Guarantor, and unconditionally promises to pay such Obligations to Lender, or order, on demand, in lawful money of the United States. 
 3. The liability of Guarantor hereunder is exclusive and independent of any security for or other guaranty of the Obligations, whether executed by
Guarantor or by any other party, and the liability of Guarantor hereunder is not affected or impaired by (a) any direction of application of payment by Company or by any other party, or (b) any other guaranty, undertaking or maximum
liability of Guarantor or of any other party as to the Obligations, or (c) any payment on or in reduction of any such other guaranty or undertaking, or (d) any revocation or release of any obligations of any other guarantor of the
guaranteed Obligations, or (e) any payment made to Lender on the Obligations which any of such Persons repay to Company pursuant to court order in any bankruptcy, reorganization, arrangement, moratorium or other debtor relief proceeding, and
Guarantor waives any right to the deferral or modification of Guarantor’s obligations hereunder by reason of any such proceeding. 
 4.
(a) The obligations of Guarantor hereunder are independent of the Obligations of Company, and a separate action or actions may be brought and prosecuted against Guarantor whether or not action is brought against Company and whether or not Company be
joined in any such action or actions. Guarantor waives, to the fullest extent permitted by law, the benefit of any statute of limitations affecting its liability hereunder or the enforcement thereof. Any payment by Company or other circumstance
which operates to toll any statute of limitations as to Company shall operate to toll the statute of limitations as to Guarantor. 
 (b) All payments made by Guarantor under this Guaranty shall be made without set-off or counterclaim and free and clear of and without deductions for any present or future taxes, fees, charges, withholdings or conditions of any nature
(“Taxes”). Guarantor shall pay any such Taxes, including Taxes on any amounts so paid, and will promptly furnish Lender with copies of any tax receipts or such other evidence of payment as Lender may require. However, Guarantor shall not
be liable for any income tax liability arising under the Loan. 
 5. Guarantor authorizes Lender (whether or not after termination of this
Guaranty), without notice or demand (except as shall be required by applicable statute and cannot be waived), and without affecting or impairing its liability hereunder, from time to time to (a) renew, compromise, extend, increase, accelerate
or otherwise change the time for payment of, or otherwise change the terms of, the Obligations or any part thereof, including increase or decrease 

  

 3 

 
of the rate of interest thereon; (b) take and hold security for the payment of this Guaranty or the Obligations and exchange, enforce, waive and release
any such security; (c) apply such security and direct the order or manner of sale thereof as Lender, in its discretion may determine; and (d) release or substitute any one or more endorsers, guarantors, Company or other obligors. Lender
may without notice to or the further consent of Company or Guarantor assign this Guaranty in whole or in part to any person acquiring an interest in the Obligations. 
 6. It is not necessary for Lender to inquire into the capacity or power of Company or the officers acting or purporting to act on its behalf, and Obligations made or created in reliance upon the professed exercise of
such powers shall be guaranteed hereunder. 
 7. Guarantor waives any right to require Lender to (a) proceed against Company or any
other party; (b) proceed against or exhaust any security held from Company; or (c) pursue any other remedy in Lender’s power whatsoever. To this end, and without limiting the generality of the foregoing, Guarantor expressly waives any
rights Guarantor might otherwise have had under the provisions of North Carolina General Statutes §26-7 et seq.. Guarantor waives any personal defense based on or arising out of any personal defense of Company other than payment in full
of the Obligations, including, without limitation, any defense based on or arising out of the disability of Company, or the invalidity or unenforceability of the Obligations or any part thereof from any cause, or the cessation from any cause of the
liability of Company other than payment in full of the Obligations. Lender may, at its election, foreclose on any security held for the guaranteed Obligations by one or more judicial or nonjudicial sales, or exercise any other right or remedy Lender
may have against Company, or any security, without affecting or impairing in any way the liability of Guarantor hereunder except to the extent the Obligations have been paid. Guarantor waives any defense arising out of any such election, even though
such election operates to impair or extinguish any right of reimbursement or subrogation or other right or remedy of Guarantor against Company or any security. Guarantor hereby waives, until such time as all of its obligations under this Guaranty
have been performed, discharged or terminated, and all Obligations under the Loan have been performed, discharged or terminated, any claim or other rights which Guarantor may now have or may hereafter acquire against the Company or any other
guarantor of all or any of the guaranteed Obligations that arise from the existence or performance of Guarantor’s obligations under this Guaranty or any other of the Loan Documents (as such claims and rights being referred to as the
“Guarantor’s Conditional Rights”), including, without limitation, any right of subrogation, reimbursement, exoneration, contribution, or indemnification, or any right to participate in any claim or remedy which the Lender has against
the Company or any collateral which the Lender now has or hereafter acquire for the Obligations, whether or not such claim, remedy or right arises in equity or under contract, statute or common law, by any payment made hereunder or otherwise,
including, without limitation, the right to take or receive from the Company, directly or indirectly, in cash or other property or setoff or in any other manner, payment or security on account of such claim or other rights. If, notwithstanding the
foregoing provisions, any amount shall be paid to Guarantor on account of Guarantor’s Conditional Rights and either (a) such amount is paid to Guarantor at any time when the Obligations shall not have been paid or performed in full, or
(b) regardless of when such amount is paid to Guarantor any payment made by Company to the Lender is at any time determined to be a preferential payment, then such amount paid to Guarantor shall be deemed to be held in trust for the benefit of
the Lender and shall forthwith be paid to the Lender 

  

 4 

 
to be credited and applied upon the Obligations, whether matured or unmatured, in such order and manner as the Lender shall determine. To the extent that any
of the provisions of this Paragraph shall not be enforceable, Guarantor agrees that until such time as the Obligations have been paid and performed in full and the period of time has expired during which any payment made by the Company or Guarantor
to the Lender may be determined to be a preferential payment, Guarantor’s Conditional Rights to the extent not validly waived shall be subordinate to the Lender’s right to full payment and performance of the Obligations and Guarantor shall
not seek to enforce Guarantor’s Conditional Rights during such period. Guarantor waives all presentments, demands for performance, protests and notices, including, without limitation, notices of nonperformance, notices of protest, notices of
dishonor, notices of acceptance of this Guaranty, and notices of the existence, creation or incurring of new or additional Obligations. Guarantor assumes all responsibility for being and keeping itself informed of Company’s financial condition
and assets, and of all other circumstances bearing upon the risk of nonpayment of the Obligations and the nature, scope and extent of the risks which Guarantor assumes and incurs hereunder, and agrees that Lender shall have no duty to advise
Guarantor of information known to any of them regarding such circumstances or risks. 
 8. In addition to the Obligations, Guarantor agrees
to pay reasonable attorneys’ fees and all other costs and expenses incurred by Lender in enforcing this Guaranty in any action or proceeding arising out of, or relating to, this Guaranty. This Guaranty and the liability and obligations of
Guarantor hereunder are binding upon Guarantor and its successors and assigns, and this Guaranty inures to the benefit of and is enforceable by Lender and its successors, transferees, and assigns. 
 9. No right or power of Lender hereunder shall be deemed to have been waived by any act or conduct on the part of the Lender, or by any neglect to
exercise such right or power, or by any delay in so doing; and every right or power shall continue in full force and effect until specifically waived or released by an instrument in writing executed by Lender. 
 10. Guarantor agrees to execute any and all further documents, instruments and agreements as Lender from time to time reasonably requests to evidence
Guarantor’s obligations hereunder. 
 11. Guarantor hereby represents and warrants and agrees that: 
 (a) Guarantor: (1) is duly organized, validly existing and in good standing as a limited partnership under the laws of the
Commonwealth of Virginia and is qualified to do business in each other jurisdiction where its ownership of property or conduct of business requires such qualification and where failure to qualify could have a material adverse effect on Guarantor or
its property or business or on Guarantor’s ability to pay or perform its obligations hereunder, (2) has the corporate power and authority and the legal right to own and operate its property and to conduct business in the manner in which it
does and proposes to do so, (3) is in compliance with all Requirements of Law and Contractual Obligations to the extent that failure to so comply could have a material adverse effect on Guarantor or the Company or any of their respective
property or business or on the ability of Company to pay or perform the Obligations or the ability of 

  

 5 

 
Guarantor to pay or perform Guarantor’s obligations hereunder, and (4) has reviewed and approved the Loan Documents. 
 (b) Guarantor has the corporate power and authority and the legal right to execute, deliver and perform the Loan Documents to which it is
a party and has taken all necessary corporate action to authorize the execution, delivery and performance of this Guaranty. The Loan Documents to which Guarantor is a party have been duly executed and delivered on behalf of Guarantor and constitute
legal, valid and binding obligations of Guarantor enforceable against Guarantor in accordance with their respective terms, subject to the effect of applicable bankruptcy and other similar laws affecting the rights of creditors generally and the
effect of equitable principles whether applied in an action at law or a suit in equity. 
 (c) Guarantor has not made, and
will not make, any agreement which (i) prohibits or restricts the pledging or creation of lien upon the Owned Hotels, if any, which Guarantor owns or (ii) creates a lien on the Owned Hotels, if any, which Guarantor owns (other than those
agreements granting the Liens noted on Schedules III and IV to the Loan Agreement). 
 (d) The
execution, delivery and performance of this Guaranty will not violate any Requirement of Law or any Contractual Obligations of Guarantor the violation of which could have a material adverse effect on the business, operations, assets or financial or
other condition of Guarantor. 
 (e) Guarantor is not an “investment company” or a company “controlled” by
an “investment company” within the meaning of the Investment Company Act of 1940, as amended. 
 (f) Neither
Guarantor nor any of the Subsidiaries of Guarantor, if any, is engaged or will engage, principally or as one of its important activities, in the business of extending credit for the purpose of “purchasing” or “carrying” any
“margin stock” within the respective meanings of such terms under Regulation U. No part of the proceeds of any Loan made under the Loan Agreement will be used, directly or indirectly, for “purchasing” or “carrying”
“margin stock” as so defined or for any purpose which violates, or which would be inconsistent with, the applicable provisions of the Regulations of the Board of Governors of the Federal Reserve System. 
 (g) No consent, approval, authorization of, or registration, declaration or filing with, any Governmental Authority is required on the
part of Guarantor in connection with the execution and delivery of the Loan Documents to which Guarantor is a party or the performance of or compliance with the terms, provisions and conditions hereof or thereof. 
 (h) To the extent of Guarantor’s actual control and knowledge, Guarantor shall (i) operate its hotels, if any, in material
compliance with the terms of any Franchise Agreements in effect as of the date hereof; (ii) promptly perform and observe (or cause to 

  

 6 

 
be performed or observed) all of the material covenants required to be performed and observed by it under the Franchise Agreements and do all things
necessary to preserve and to keep unimpaired its material rights thereunder; (iii) promptly notify Lender of any event of default under the Franchise Agreements of which it is aware; and (iv) promptly enforce the performance and observance
of all of the covenants required to be performed and observed by the franchisor under the Franchise Agreements. To the extent of Guarantor’s actual control and knowledge, without Lender’s prior consent, Guarantor shall not, and shall not
permit the lessee under any percentage lease or any manager to: (i) surrender, terminate or cancel any Franchise Agreement; (ii) reduce or consent to the reduction of the term of any Franchise Agreement; (iii) increase or consent to
the increase of the amount of any charges under any Franchise Agreement; (iv) otherwise modify, change, supplement, alter or amend, or waive or release any of its rights and remedies under, any Franchise Agreement or (v) suffer or permit
the occurrence of continuance a default beyond any applicable cure period under any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved by Lender) if such default permits the franchiser to terminate or
cancel any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved by Lender). 
 (i)
Guarantor is not and shall not be a party to any Indebtedness other than (i) the Indebtedness evidenced by this Guaranty and (ii) the Indebtedness listed on Schedule III to the Credit Agreement, and Guarantor shall not incur
any additional Indebtedness on or secured by (including, without limitation, by any Lien, pledge, encumbrance or hypothecation of or on) any Hotel property owned by Guarantor, other than that Indebtedness contemplated on Schedules III
and IV of the Loan Agreement. 
 (j) Guarantor shall maintain its corporate existence and obtain and
maintain all rights, privileges, licenses, approvals, franchises, properties and assets necessary or desirable in the normal conduct of its business, and comply with all Contractual Obligations and Requirements of Law, in each case applicable to the
conduct of its business, except where the failure to so comply is not likely to have a material adverse effect on the business, operations, assets or financial or other condition of Guarantor. 
 (k) Guarantor shall pay or otherwise satisfy at or before maturity or before it becomes delinquent or accelerated, as the case may be, all
its Indebtedness (including taxes), except Indebtedness being contested in good faith by appropriate proceedings and for which provision is made to the satisfaction of Lender for the payment thereof in the event Guarantor is found to be obligated to
pay such Indebtedness and which Indebtedness is thereupon promptly paid by Guarantor. 
 (1) Guarantor shall keep proper books
of record and account in which full, true and correct entries in conformity with GAAP and all Requirements of Law shall be made of all dealings and transactions in relation to its business and activities. 
 (m) Guarantor shall not sell, lease, assign, transfer or otherwise dispose of any of its assets (other than obsolete or worn out
property), whether now owned or hereafter 

  

 7 

 
acquired, other than in the ordinary course of business and at fair market value, without the prior written consent of Lender. 
 12. This Guaranty shall be deemed to be made under and shall be governed by the laws of the State of North Carolina. 
 13. If any of the provisions of this Guaranty shall contravene or be held invalid under the laws of any jurisdiction, this Guaranty shall be construed as
if not containing those provisions and the rights and obligations of the parties hereto shall be construed and enforced accordingly. 
 [SIGNATURE ON NEXT PAGE] 
  

 8 

 Executed and sealed as of the day and year first above written. 
  

					
	APPLE SEVEN HOSPITALITY TEXAS, L.P., a Virginia limited partnership
		
	By:	 	 Apple Seven Texas GP, Inc.,
 a Virginia
corporation,
 its sole general partner

			
		 	By:	 	/s/ Justin G. Knight
		 	Name:	 	Justin G. Knight
		 	Title:	 	President

 GUARANTY 
 THIS GUARANTY (the “Guaranty”) is made and dated as of the 14th day of
December , 2006 by APPLE SEVEN HOSPITALITY SOUTHEAST, L.P., a Virginia limited partnership (“Guarantor”). 
 RECITALS

 A. Pursuant to that certain Loan Agreement of even date herewith between Apple REIT Seven, Inc. (the “Company”) and Wachovia
Bank, National Association (the “Lender”), (as amended, extended and replaced from time to time, the “Loan Agreement,” and with capitalized terms not otherwise defined herein used with the same meanings as in the Loan Agreement)
the Lender has agreed to extend credit to the Company, on the terms and subject to the conditions set forth therein. 
 B. As a condition
precedent to the effectiveness of the Loan Documents and pursuant to the terms of and as specifically required as a condition to the effectiveness of the Loan Agreement, Guarantor is required to execute and deliver to the Lender this Guaranty.

 C. Guarantor is wholly-owned by Apple Seven Southeast GP, Inc. and Apple Seven Southeast LP, Inc., each of which is wholly-owned by Apple
Seven Hospitality Ownership, Inc., which is wholly-owned by Apple Seven Hospitality, Inc., which is a wholly-owned subsidiary of the Company, and thus will derive material benefit from the extension of credit by the Lender to the Company pursuant to
the Loan Agreement. 
 NOW, THEREFORE, in consideration of the above Recitals and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, Guarantor hereby agrees as follows: 
 AGREEMENT 
 1. (a) Guarantor hereby irrevocably and unconditionally guarantees the payment when due, upon maturity, acceleration or otherwise, of the
Obligations, whether heretofore, now, or hereafter made, incurred or created, whether voluntary or involuntary and however arising, absolute or contingent, liquidated or unliquidated, determined or undetermined, whether or not such Obligations are
from time to time reduced, or extinguished and thereafter increased or incurred, whether Company may be liable individually or jointly with others, whether or not recovery upon such Obligations may be or hereafter become barred by any statute of
limitations, and whether or not such Obligations may be or hereafter become otherwise invalid or unenforceable. This Guaranty is a guaranty of payment and not of collection. 
 (b) Notwithstanding anything to the contrary contained in subsection (a) above, it is the intention of Guarantor and Lender that, in
any proceeding involving the bankruptcy, reorganization, arrangement, adjustment of debts, relief of debtors, dissolution or insolvency or any similar proceeding with respect to Guarantor or its assets, the amount of 

 
Guarantor’s obligations under this Guaranty shall be in, but not in excess of, the maximum amount thereof not subject to avoidance or recovery by
operation of all applicable laws governing bankruptcy, reorganization, arrangement, adjustment of debts, relief of debtors, dissolution, insolvency, fraudulent transfers or conveyances or other similar laws (including, without limitation, 11 U.S.C.
Sections 547, 548 and 550 and other “avoidance” provisions of Title 11 of the United States Code) (“Applicable Insolvency Laws”) after giving effect to subsection (c) below. To that end, but only in the event and to the
extent that after giving effect to subsection (c) below Guarantor’s obligations under this Guaranty or any payment made pursuant hereto would, but for the operation of the first sentence of this subsection (b), be subject to avoidance or
recovery in any such proceeding under Applicable Insolvency Laws after giving effect to subsection (c) below, the amount of Guarantor’s obligations under this Guaranty shall be limited to the largest amount which, after giving effect
thereto, would not, under Applicable Insolvency Laws, render Guarantor’s obligations under this Guaranty unenforceable or avoidable or otherwise subject to recovery under Applicable Insolvency Laws. To the extent any payment actually made by
Guarantor pursuant to this Guaranty exceeds the limitation of the first sentence of this subsection (b) and is otherwise subject to avoidance and recovery in any such proceeding under Applicable Insolvency Laws, the amount subject to avoidance
shall in all events be limited to the amount by which such actual payment exceeds such limitation and the obligations of Guarantor hereunder, as limited by the first sentence of this subsection (b), shall in all events remain in full force and
effect and be fully enforceable against Guarantor. The first sentence of this subsection (b) is intended solely to preserve the rights of Lender hereunder against Guarantor in such proceeding to the maximum extent permitted by Applicable
Insolvency Laws and neither Guarantor, Company, any other guarantor nor any other Person shall have any right or claim under such sentence that would not otherwise be available under Applicable Insolvency Laws in such proceeding. 
 (c) (i) To the extent Guarantor is required, by reason of its obligations hereunder, to pay to Lender an amount greater than the
amount of value (as determined in accordance with Applicable Insolvency Laws) actually made available to or for the benefit of Guarantor on account of the Loan Agreement, this Guaranty or any other Loan Document, Guarantor shall have an enforceable
right of contribution against Company, and Company shall be liable for repayment of the full amount of such excess payment. Subject only to the subordination provided in the following clause (ii), Guarantor further shall be subrogated to any and all
rights of Lender against Company to the extent of such excess payment. 
 (ii) Notwithstanding any payment or payments by
Guarantor hereunder, or any set-off or application of funds of Guarantor by Lender, or the receipt of any amounts by Lender with respect to any of the obligations of Guarantor hereunder, Guarantor shall not be entitled to be subrogated to any of the
rights of Lender against Company or any other guarantors or against any collateral security, if any, held by or for the benefit of Lender for the payment of the Obligations nor shall Guarantor seek any reimbursement from Company in respect of
payments made by Guarantor in connection with the obligations of Guarantor hereunder, until all amounts owing to Lender on account of the Obligations are paid in full and the Aggregate Commitment is terminated. If any amount shall be paid to
Guarantor on account of such subrogation rights at any time when all of the Obligations shall not have been paid in full, such amount shall be held by Guarantor in trust for Lender, segregated from other funds of 

  

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Guarantor, and shall, forthwith upon receipt by Guarantor, be turned over to Lender in the exact form received by Guarantor (duly endorsed by Guarantor to
Lender, if required) to be applied against the Obligations, whether matured or unmatured, in such order as set forth in the Loan Agreement. 
 2. Guarantor irrevocably and unconditionally guarantees the payment of the Obligations whether or not due or payable by Company upon: (a) the dissolution, insolvency or business failure of, or any assignment for benefit of creditors
by, or commencement of any bankruptcy, reorganization, arrangement, moratorium or other debtor relief proceedings by or against, Company or Guarantor, or (b) the appointment of a receiver for, or the attachment, restraint of or making or
levying of any order of court or legal process affecting, the property of Company or Guarantor, and unconditionally promises to pay such Obligations to Lender, or order, on demand, in lawful money of the United States. 
 3. The liability of Guarantor hereunder is exclusive and independent of any security for or other guaranty of the Obligations, whether executed by
Guarantor or by any other party, and the liability of Guarantor hereunder is not affected or impaired by (a) any direction of application of payment by Company or by any other party, or (b) any other guaranty, undertaking or maximum
liability of Guarantor or of any other party as to the Obligations, or (c) any payment on or in reduction of any such other guaranty or undertaking, or (d) any revocation or release of any obligations of any other guarantor of the
guaranteed Obligations, or (e) any payment made to Lender on the Obligations which any of such Persons repay to Company pursuant to court order in any bankruptcy, reorganization, arrangement, moratorium or other debtor relief proceeding, and
Guarantor waives any right to the deferral or modification of Guarantor’s obligations hereunder by reason of any such proceeding. 
 4.
(a) The obligations of Guarantor hereunder are independent of the Obligations of Company, and a separate action or actions may be brought and prosecuted against Guarantor whether or not action is brought against Company and whether or not Company be
joined in any such action or actions. Guarantor waives, to the fullest extent permitted by law, the benefit of any statute of limitations affecting its liability hereunder or the enforcement thereof. Any payment by Company or other circumstance
which operates to toll any statute of limitations as to Company shall operate to toll the statute of limitations as to Guarantor. 
 (b) All payments made by Guarantor under this Guaranty shall be made without set-off or counterclaim and free and clear of and without deductions for any present or future taxes, fees, charges, withholdings or conditions of any nature
(“Taxes”). Guarantor shall pay any such Taxes, including Taxes on any amounts so paid, and will promptly furnish Lender with copies of any tax receipts or such other evidence of payment as Lender may require. However, Guarantor shall not
be liable for any income tax liability arising under the Loan. 
 5. Guarantor authorizes Lender (whether or not after termination of this
Guaranty), without notice or demand (except as shall be required by applicable statute and cannot be waived), and without affecting or impairing its liability hereunder, from time to time to (a) renew, compromise, extend, increase, accelerate
or otherwise change the time for payment of, or otherwise change the terms of, the Obligations or any part thereof, including increase or decrease 

  

 3 

 
of the rate of interest thereon; (b) take and hold security for the payment of this Guaranty or the Obligations and exchange, enforce, waive and release
any such security; (c) apply such security and direct the order or manner of sale thereof as Lender, in its discretion may determine; and (d) release or substitute any one or more endorsers, guarantors, Company or other obligors. Lender
may without notice to or the further consent of Company or Guarantor assign this Guaranty in whole or in part to any person acquiring an interest in the Obligations. 
 6. It is not necessary for Lender to inquire into the capacity or power of Company or the officers acting or purporting to act on its behalf, and Obligations made or created in reliance upon the professed exercise of
such powers shall be guaranteed hereunder. 
 7. Guarantor waives any right to require Lender to (a) proceed against Company or any
other party; (b) proceed against or exhaust any security held from Company; or (c) pursue any other remedy in Lender’s power whatsoever. To this end, and without limiting the generality of the foregoing, Guarantor expressly waives any
rights Guarantor might otherwise have had under the provisions of North Carolina General Statutes §26-7 et seq.. Guarantor waives any personal defense based on or arising out of any personal defense of Company other than payment in full
of the Obligations, including, without limitation, any defense based on or arising out of the disability of Company, or the invalidity or unenforceability of the Obligations or any part thereof from any cause, or the cessation from any cause of the
liability of Company other than payment in full of the Obligations. Lender may, at its election, foreclose on any security held for the guaranteed Obligations by one or more judicial or nonjudicial sales, or exercise any other right or remedy Lender
may have against Company, or any security, without affecting or impairing in any way the liability of Guarantor hereunder except to the extent the Obligations have been paid. Guarantor waives any defense arising out of any such election, even though
such election operates to impair or extinguish any right of reimbursement or subrogation or other right or remedy of Guarantor against Company or any security. Guarantor hereby waives, until such time as all of its obligations under this Guaranty
have been performed, discharged or terminated, and all Obligations under the Loan have been performed, discharged or terminated, any claim or other rights which Guarantor may now have or may hereafter acquire against the Company or any other
guarantor of all or any of the guaranteed Obligations that arise from the existence or performance of Guarantor’s obligations under this Guaranty or any other of the Loan Documents (as such claims and rights being referred to as the
“Guarantor’s Conditional Rights”), including, without limitation, any right of subrogation, reimbursement, exoneration, contribution, or indemnification, or any right to participate in any claim or remedy which the Lender has against
the Company or any collateral which the Lender now has or hereafter acquire for the Obligations, whether or not such claim, remedy or right arises in equity or under contract, statute or common law, by any payment made hereunder or otherwise,
including, without limitation, the right to take or receive from the Company, directly or indirectly, in cash or other property or setoff or in any other manner, payment or security on account of such claim or other rights. If, notwithstanding the
foregoing provisions, any amount shall be paid to Guarantor on account of Guarantor’s Conditional Rights and either (a) such amount is paid to Guarantor at any time when the Obligations shall not have been paid or performed in full, or
(b) regardless of when such amount is paid to Guarantor any payment made by Company to the Lender is at any time determined to be a preferential payment, then such amount paid to Guarantor shall be deemed to be held in trust for the benefit of
the Lender and shall forthwith be paid to the Lender 

  

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to be credited and applied upon the Obligations, whether matured or unmatured, in such order and manner as the Lender shall determine. To the extent that any
of the provisions of this Paragraph shall not be enforceable, Guarantor agrees that until such time as the Obligations have been paid and performed in full and the period of time has expired during which any payment made by the Company or Guarantor
to the Lender may be determined to be a preferential payment, Guarantor’s Conditional Rights to the extent not validly waived shall be subordinate to the Lender’s right to full payment and performance of the Obligations and Guarantor shall
not seek to enforce Guarantor’s Conditional Rights during such period. Guarantor waives all presentments, demands for performance, protests and notices, including, without limitation, notices of nonperformance, notices of protest, notices of
dishonor, notices of acceptance of this Guaranty, and notices of the existence, creation or incurring of new or additional Obligations. Guarantor assumes all responsibility for being and keeping itself informed of Company’s financial condition
and assets, and of all other circumstances bearing upon the risk of nonpayment of the Obligations and the nature, scope and extent of the risks which Guarantor assumes and incurs hereunder, and agrees that Lender shall have no duty to advise
Guarantor of information known to any of them regarding such circumstances or risks. 
 8. In addition to the Obligations, Guarantor agrees
to pay reasonable attorneys’ fees and all other costs and expenses incurred by Lender in enforcing this Guaranty in any action or proceeding arising out of, or relating to, this Guaranty. This Guaranty and the liability and obligations of
Guarantor hereunder are binding upon Guarantor and its successors and assigns, and this Guaranty inures to the benefit of and is enforceable by Lender and its successors, transferees, and assigns. 
 9. No right or power of Lender hereunder shall be deemed to have been waived by any act or conduct on the part of the Lender, or by any neglect to
exercise such right or power, or by any delay in so doing; and every right or power shall continue in full force and effect until specifically waived or released by an instrument in writing executed by Lender. 
 10. Guarantor agrees to execute any and all further documents, instruments and agreements as Lender from time to time reasonably requests to evidence
Guarantor’s obligations hereunder. 
 11. Guarantor hereby represents and warrants and agrees that: 
 (a) Guarantor: (1) is duly organized, validly existing and in good standing as a limited partnership under the laws of the
Commonwealth of Virginia and is qualified to do business in each other jurisdiction where its ownership of property or conduct of business requires such qualification and where failure to qualify could have a material adverse effect on Guarantor or
its property or business or on Guarantor’s ability to pay or perform its obligations hereunder, (2) has the corporate power and authority and the legal right to own and operate its property and to conduct business in the manner in which it
does and proposes to do so, (3) is in compliance with all Requirements of Law and Contractual Obligations to the extent that failure to so comply could have a material adverse effect on Guarantor or the Company or any of their respective
property or business or on the ability of Company to pay or perform the Obligations or the ability of Guarantor to pay or perform 

  

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Guarantor’s obligations hereunder, and (4) has reviewed and approved the Loan Documents. 
 (b) Guarantor has the corporate power and authority and the legal right to execute, deliver and perform the Loan Documents to which it is
a party and has taken all necessary corporate action to authorize the execution, delivery and performance of this Guaranty. The Loan Documents to which Guarantor is a party have been duly executed and delivered on behalf of Guarantor and constitute
legal, valid and binding obligations of Guarantor enforceable against Guarantor in accordance with their respective terms, subject to the effect of applicable bankruptcy and other similar laws affecting the rights of creditors generally and the
effect of equitable principles whether applied in an action at law or a suit in equity. 
 (c) Guarantor has not made, and
will not make, any agreement which (i) prohibits or restricts the pledging or creation of lien upon the Owned Hotels, if any, which Guarantor owns or (ii) creates a lien on the Owned Hotels, if any, which Guarantor owns (other than those
agreements granting the Liens noted on Schedules III and IV to the Loan Agreement). 
 (d) The
execution, delivery and performance of this Guaranty will not violate any Requirement of Law or any Contractual Obligations of Guarantor the violation of which could have a material adverse effect on the business, operations, assets or financial or
other condition of Guarantor. 
 (e) Guarantor is not an “investment company” or a company “controlled” by
an “investment company” within the meaning of the Investment Company Act of 1940, as amended. 
 (f) Neither
Guarantor nor any of the Subsidiaries of Guarantor, if any, is engaged or will engage, principally or as one of its important activities, in the business of extending credit for the purpose of “purchasing” or “carrying” any
“margin stock” within the respective meanings of such terms under Regulation U. No part of the proceeds of any Loan made under the Loan Agreement will be used, directly or indirectly, for “purchasing” or “carrying”
“margin stock” as so defined or for any purpose which violates, or which would be inconsistent with, the applicable provisions of the Regulations of the Board of Governors of the Federal Reserve System. 
 (g) No consent, approval, authorization of, or registration, declaration or filing with, any Governmental Authority is required on the
part of Guarantor in connection with the execution and delivery of the Loan Documents to which Guarantor is a party or the performance of or compliance with the terms, provisions and conditions hereof or thereof. 
 (h) To the extent of Guarantor’s actual control and knowledge, Guarantor shall (i) operate its hotels, if any, in material
compliance with the terms of any Franchise Agreements in effect as of the date hereof; (ii) promptly perform and observe (or cause to 

  

 6 

 
be performed or observed) all of the material covenants required to be performed and observed by it under the Franchise Agreements and do all things
necessary to preserve and to keep unimpaired its material rights thereunder; (iii) promptly notify Lender of any event of default under the Franchise Agreements of which it is aware; and (iv) promptly enforce the performance and observance
of all of the covenants required to be performed and observed by the franchisor under the Franchise Agreements. To the extent of Guarantor’s actual control and knowledge, without Lender’s prior consent, Guarantor shall not, and shall not
permit the lessee under any percentage lease or any manager to: (i) surrender, terminate or cancel any Franchise Agreement; (ii) reduce or consent to the reduction of the term of any Franchise Agreement; (iii) increase or consent to
the increase of the amount of any charges under any Franchise Agreement; (iv) otherwise modify, change, supplement, alter or amend, or waive or release any of its rights and remedies under, any Franchise Agreement or (v) suffer or permit
the occurrence of continuance a default beyond any applicable cure period under any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved by Lender) if such default permits the franchiser to terminate or
cancel any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved by Lender). 
 (i)
Guarantor is not and shall not be a party to any Indebtedness other than (i) the Indebtedness evidenced by this Guaranty and (ii) the Indebtedness listed on Schedule III to the Credit Agreement, and Guarantor shall not incur
any additional Indebtedness on or secured by (including, without limitation, by any Lien, pledge, encumbrance or hypothecation of or on) any Hotel property owned by Guarantor, other than that Indebtedness contemplated on Schedules III
and IV of the Loan Agreement. 
 (j) Guarantor shall maintain its corporate existence and obtain and
maintain all rights, privileges, licenses, approvals, franchises, properties and assets necessary or desirable in the normal conduct of its business, and comply with all Contractual Obligations and Requirements of Law, in each case applicable to the
conduct of its business, except where the failure to so comply is not likely to have a material adverse effect on the business, operations, assets or financial or other condition of Guarantor. 
 (k) Guarantor shall pay or otherwise satisfy at or before maturity or before it becomes delinquent or accelerated, as the case may be, all
its Indebtedness (including taxes), except Indebtedness being contested in good faith by appropriate proceedings and for which provision is made to the satisfaction of Lender for the payment thereof in the event Guarantor is found to be obligated to
pay such Indebtedness and which Indebtedness is thereupon promptly paid by Guarantor. 
 (l) Guarantor shall keep proper books
of record and account in which full, true and correct entries in conformity with GAAP and all Requirements of Law shall be made of all dealings and transactions in relation to its business and activities. 
 (m) Guarantor shall not sell, lease, assign, transfer or otherwise dispose of any of its assets (other than obsolete or worn out
property), whether now owned or hereafter 

  

 7 

 
acquired, other than in the ordinary course of business and at fair market value, without the prior written consent of Lender. 
 12. This Guaranty shall be deemed to be made under and shall be governed by the laws of the State of North Carolina. 
 13. If any of the provisions of this Guaranty shall contravene or be held invalid under the laws of any jurisdiction, this Guaranty shall be construed as
if not containing those provisions and the rights and obligations of the parties hereto shall be construed and enforced accordingly. 
 [SIGNATURE ON NEXT PAGE] 
  

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 Executed and sealed as of the day and year first above written. 
  

					
	APPLE SEVEN HOSPITALITY SOUTHEAST, L.P., a Virginia limited partnership
		
	By:	 	Apple Seven Southeast GP, Inc.,
a Virginia corporation,
its sole general partner
			
		 	By:	 	/s/ Justin G. Knight
		 	Name:	 	Justin G. Knight
		 	Title:	 	President

 GUARANTY 
 THIS GUARANTY (the “Guaranty”) is made and dated as of the14th
day of December, 2006 by SUNBELT-CHM, L.L.C., an Alabama limited liability company (“Guarantor”). 
 RECITALS 
 A. Pursuant to that certain Loan Agreement of even date herewith between Apple REIT Seven, Inc. (the
“Company”) and Wachovia Bank, National Association (the “Lender”), (as amended, extended and replaced from time to time, the “Loan Agreement,” and with capitalized terms not otherwise defined herein used with the same
meanings as in the Loan Agreement) the Lender has agreed to extend credit to the Company, on the terms and subject to the conditions set forth therein. 
 B. As a condition precedent to the effectiveness of the Loan Documents and pursuant to the terms of and as specifically required as a condition to the effectiveness of the Loan Agreement, Guarantor is required to
execute and deliver to the Lender this Guaranty. 
 C. Guarantor is wholly-owned by Apple Seven Hospitality Ownership, Inc., which is
wholly-owned by Apple Seven Hospitality, Inc., which is a wholly-owned subsidiary of the Company, and thus will derive material benefit from the extension of credit by the Lender to the Company pursuant to the Loan Agreement. 
 NOW, THEREFORE, in consideration of the above Recitals and for other good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, Guarantor hereby agrees as follows: 
 AGREEMENT 
 1. (a) Guarantor hereby irrevocably and unconditionally guarantees the payment when due, upon maturity, acceleration or otherwise, of the
Obligations, whether heretofore, now, or hereafter made, incurred or created, whether voluntary or involuntary and however arising, absolute or contingent, liquidated or unliquidated, determined or undetermined, whether or not such Obligations are
from time to time reduced, or extinguished and thereafter increased or incurred, whether Company may be liable individually or jointly with others, whether or not recovery upon such Obligations may be or hereafter become barred by any statute of
limitations, and whether or not such Obligations may be or hereafter become otherwise invalid or unenforceable. This Guaranty is a guaranty of payment and not of collection. 
 (b) Notwithstanding anything to the contrary contained in subsection (a) above, it is the intention of Guarantor and Lender that, in
any proceeding involving the bankruptcy, reorganization, arrangement, adjustment of debts, relief of debtors, dissolution or insolvency or any similar proceeding with respect to Guarantor or its assets, the amount of Guarantor’s obligations
under this Guaranty shall be in, but not in excess of, the maximum 

 
amount thereof not subject to avoidance or recovery by operation of all applicable laws governing bankruptcy, reorganization, arrangement, adjustment of
debts, relief of debtors, dissolution, insolvency, fraudulent transfers or conveyances or other similar laws (including, without limitation, 11 U.S.C. Sections 547, 548 and 550 and other “avoidance” provisions of Title 11 of the United
States Code) (“Applicable Insolvency Laws”) after giving effect to subsection (c) below. To that end, but only in the event and to the extent that after giving effect to subsection (c) below Guarantor’s obligations under
this Guaranty or any payment made pursuant hereto would, but for the operation of the first sentence of this subsection (b), be subject to avoidance or recovery in any such proceeding under Applicable Insolvency Laws after giving effect to
subsection (c) below, the amount of Guarantor’s obligations under this Guaranty shall be limited to the largest amount which, after giving effect thereto, would not, under Applicable Insolvency Laws, render Guarantor’s obligations
under this Guaranty unenforceable or avoidable or otherwise subject to recovery under Applicable Insolvency Laws. To the extent any payment actually made by Guarantor pursuant to this Guaranty exceeds the limitation of the first sentence of this
subsection (b) and is otherwise subject to avoidance and recovery in any such proceeding under Applicable Insolvency Laws, the amount subject to avoidance shall in all events be limited to the amount by which such actual payment exceeds such
limitation and the obligations of Guarantor hereunder, as limited by the first sentence of this subsection (b), shall in all events remain in full force and effect and be fully enforceable against Guarantor. The first sentence of this subsection
(b) is intended solely to preserve the rights of Lender hereunder against Guarantor in such proceeding to the maximum extent permitted by Applicable Insolvency Laws and neither Guarantor, Company, any other guarantor nor any other Person shall
have any right or claim under such sentence that would not otherwise be available under Applicable Insolvency Laws in such proceeding. 
 (c) (i) To the extent Guarantor is required, by reason of its obligations hereunder, to pay to Lender an amount greater than the amount of value (as determined in accordance with Applicable Insolvency Laws)
actually made available to or for the benefit of Guarantor on account of the Loan Agreement, this Guaranty or any other Loan Document, Guarantor shall have an enforceable right of contribution against Company, and Company shall be liable for
repayment of the full amount of such excess payment. Subject only to the subordination provided in the following clause (ii), Guarantor further shall be subrogated to any and all rights of Lender against Company to the extent of such excess payment.

 (ii) Notwithstanding any payment or payments by Guarantor hereunder, or any set-off or application of funds of Guarantor by
Lender, or the receipt of any amounts by Lender with respect to any of the obligations of Guarantor hereunder, Guarantor shall not be entitled to be subrogated to any of the rights of Lender against Company or any other guarantors or against any
collateral security, if any, held by or for the benefit of Lender for the payment of the Obligations nor shall Guarantor seek any reimbursement from Company in respect of payments made by Guarantor in connection with the obligations of Guarantor
hereunder, until all amounts owing to Lender on account of the Obligations are paid in full and the Aggregate Commitment is terminated. If any amount shall be paid to Guarantor on account of such subrogation rights at any time when all of the
Obligations shall not have been paid in full, such amount shall be held by Guarantor in trust for Lender, segregated from other funds of Guarantor, and shall, forthwith upon receipt by Guarantor, be turned over to Lender in the exact 

  

 2 

 
form received by Guarantor (duly endorsed by Guarantor to Lender, if required) to be applied against the Obligations, whether matured or unmatured, in such
order as set forth in the Loan Agreement. 
 2. Guarantor irrevocably and unconditionally guarantees the payment of the Obligations whether
or not due or payable by Company upon: (a) the dissolution, insolvency or business failure of, or any assignment for benefit of creditors by, or commencement of any bankruptcy, reorganization, arrangement, moratorium or other debtor relief
proceedings by or against, Company or Guarantor, or (b) the appointment of a receiver for, or the attachment, restraint of or making or levying of any order of court or legal process affecting, the property of Company or Guarantor, and
unconditionally promises to pay such Obligations to Lender, or order, on demand, in lawful money of the United States. 
 3. The liability of
Guarantor hereunder is exclusive and independent of any security for or other guaranty of the Obligations, whether executed by Guarantor or by any other party, and the liability of Guarantor hereunder is not affected or impaired by (a) any
direction of application of payment by Company or by any other party, or (b) any other guaranty, undertaking or maximum liability of Guarantor or of any other party as to the Obligations, or (c) any payment on or in reduction of any such
other guaranty or undertaking, or (d) any revocation or release of any obligations of any other guarantor of the guaranteed Obligations, or (e) any payment made to Lender on the Obligations which any of such Persons repay to Company
pursuant to court order in any bankruptcy, reorganization, arrangement, moratorium or other debtor relief proceeding, and Guarantor waives any right to the deferral or modification of Guarantor’s obligations hereunder by reason of any such
proceeding. 
 4. (a) The obligations of Guarantor hereunder are independent of the Obligations of Company, and a separate action or actions
may be brought and prosecuted against Guarantor whether or not action is brought against Company and whether or not Company be joined in any such action or actions. Guarantor waives, to the fullest extent permitted by law, the benefit of any statute
of limitations affecting its liability hereunder or the enforcement thereof. Any payment by Company or other circumstance which operates to toll any statute of limitations as to Company shall operate to toll the statute of limitations as to
Guarantor. 
 (b) All payments made by Guarantor under this Guaranty shall be made without set-off or counterclaim and free
and clear of and without deductions for any present or future taxes, fees, charges, withholdings or conditions of any nature (“Taxes”). Guarantor shall pay any such Taxes, including Taxes on any amounts so paid, and will promptly furnish
Lender with copies of any tax receipts or such other evidence of payment as Lender may require. However, Guarantor shall not be liable for any income tax liability arising under the Loan. 
 5. Guarantor authorizes Lender (whether or not after termination of this Guaranty), without notice or demand (except as shall be required by applicable
statute and cannot be waived), and without affecting or impairing its liability hereunder, from time to time to (a) renew, compromise, extend, increase, accelerate or otherwise change the time for payment of, or otherwise change the terms of,
the Obligations or any part thereof, including increase or decrease of the rate of interest thereon; (b) take and hold security for the payment of this Guaranty or the 

  

 3 

 
Obligations and exchange, enforce, waive and release any such security; (c) apply such security and direct the order or manner of sale thereof as
Lender, in its discretion may determine; and (d) release or substitute any one or more endorsers, guarantors, Company or other obligors. Lender may without notice to or the further consent of Company or Guarantor assign this Guaranty in whole
or in part to any person acquiring an interest in the Obligations. 
 6. It is not necessary for Lender to inquire into the capacity or power
of Company or the officers acting or purporting to act on its behalf, and Obligations made or created in reliance upon the professed exercise of such powers shall be guaranteed hereunder. 
 7. Guarantor waives any right to require Lender to (a) proceed against Company or any other party; (b) proceed against or exhaust any security
held from Company; or (c) pursue any other remedy in Lender’s power whatsoever. To this end, and without limiting the generality of the foregoing, Guarantor expressly waives any rights Guarantor might otherwise have had under the
provisions of North Carolina General Statutes §26-7 et seq. Guarantor waives any personal defense based on or arising out of any personal defense of Company other than payment in full of the Obligations, including, without limitation,
any defense based on or arising out of the disability of Company, or the invalidity or unenforceability of the Obligations or any part thereof from any cause, or the cessation from any cause of the liability of Company other than payment in full of
the Obligations. Lender may, at its election, foreclose on any security held for the guaranteed Obligations by one or more judicial or nonjudicial sales, or exercise any other right or remedy Lender may have against Company, or any security, without
affecting or impairing in any way the liability of Guarantor hereunder except to the extent the Obligations have been paid. Guarantor waives any defense arising out of any such election, even though such election operates to impair or extinguish any
right of reimbursement or subrogation or other right or remedy of Guarantor against Company or any security. Guarantor hereby waives, until such time as all of its obligations under this Guaranty have been performed, discharged or terminated, and
all Obligations under the Loan have been performed, discharged or terminated, any claim or other rights which Guarantor may now have or may hereafter acquire against the Company or any other guarantor of all or any of the guaranteed Obligations that
arise from the existence or performance of Guarantor’s obligations under this Guaranty or any other of the Loan Documents (as such claims and rights being referred to as the “Guarantor’s Conditional Rights”), including, without
limitation, any right of subrogation, reimbursement, exoneration, contribution, or indemnification, or any right to participate in any claim or remedy which the Lender has against the Company or any collateral which the Lender now has or hereafter
acquire for the Obligations, whether or not such claim, remedy or right arises in equity or under contract, statute or common law, by any payment made hereunder or otherwise, including, without limitation, the right to take or receive from the
Company, directly or indirectly, in cash or other property or setoff or in any other manner, payment or security on account of such claim or other rights. If, notwithstanding the foregoing provisions, any amount shall be paid to Guarantor on account
of Guarantor’s Conditional Rights and either (a) such amount is paid to Guarantor at any time when the Obligations shall not have been paid or performed in full, or (b) regardless of when such amount is paid to Guarantor any payment
made by Company to the Lender is at any time determined to be a preferential payment, then such amount paid to Guarantor shall be deemed to be held in trust for the benefit of the Lender and shall forthwith be paid to the Lender to be credited and
applied upon the Obligations, whether matured or unmatured, in such order 

  

 4 

 
and manner as the Lender shall determine. To the extent that any of the provisions of this Paragraph shall not be enforceable, Guarantor agrees that until
such time as the Obligations have been paid and performed in full and the period of time has expired during which any payment made by the Company or Guarantor to the Lender may be determined to be a preferential payment, Guarantor’s Conditional
Rights to the extent not validly waived shall be subordinate to the Lender’s right to full payment and performance of the Obligations and Guarantor shall not seek to enforce Guarantor’s Conditional Rights during such period. Guarantor
waives all presentments, demands for performance, protests and notices, including, without limitation, notices of nonperformance, notices of protest, notices of dishonor, notices of acceptance of this Guaranty, and notices of the existence, creation
or incurring of new or additional Obligations. Guarantor assumes all responsibility for being and keeping itself informed of Company’s financial condition and assets, and of all other circumstances bearing upon the risk of nonpayment of the
Obligations and the nature, scope and extent of the risks which Guarantor assumes and incurs hereunder, and agrees that Lender shall have no duty to advise Guarantor of information known to any of them regarding such circumstances or risks.

 8. In addition to the Obligations, Guarantor agrees to pay reasonable attorneys’ fees and all other costs and expenses incurred by
Lender in enforcing this Guaranty in any action or proceeding arising out of, or relating to, this Guaranty. This Guaranty and the liability and obligations of Guarantor hereunder are binding upon Guarantor and its successors and assigns, and this
Guaranty inures to the benefit of and is enforceable by Lender and its successors, transferees, and assigns. 
 9. No right or power of
Lender hereunder shall be deemed to have been waived by any act or conduct on the part of the Lender, or by any neglect to exercise such right or power, or by any delay in so doing; and every right or power shall continue in full force and effect
until specifically waived or released by an instrument in writing executed by Lender. 
 10. Guarantor agrees to execute any and all further
documents, instruments and agreements as Lender from time to time reasonably requests to evidence Guarantor’s obligations hereunder. 
 11. Guarantor hereby represents and warrants and agrees that: 
 (a) Guarantor: (1) is duly organized, validly
existing and in good standing as a corporation under the laws of the State of Alabama and is qualified to do business in each other jurisdiction where its ownership of property or conduct of business requires such qualification and where failure to
qualify could have a material adverse effect on Guarantor or its property or business or on Guarantor’s ability to pay or perform its obligations hereunder, (2) has the corporate power and authority and the legal right to own and operate
its property and to conduct business in the manner in which it does and proposes to do so, (3) is in compliance with all Requirements of Law and Contractual Obligations to the extent that failure to so comply could have a material adverse
effect on Guarantor or the Company or any of their respective property or business or on the ability of Company to pay or perform the Obligations or the ability of Guarantor to pay or 

  

 5 

 
perform Guarantor’s obligations hereunder, and (4) has reviewed and approved the Loan Documents. 
 (b) Guarantor has the corporate power and authority and the legal right to execute, deliver and perform the Loan Documents to which it is
a party and has taken all necessary corporate action to authorize the execution, delivery and performance of this Guaranty. The Loan Documents to which Guarantor is a party have been duly executed and delivered on behalf of Guarantor and constitute
legal, valid and binding obligations of Guarantor enforceable against Guarantor in accordance with their respective terms, subject to the effect of applicable bankruptcy and other similar laws affecting the rights of creditors generally and the
effect of equitable principles whether applied in an action at law or a suit in equity. 
 (c) Guarantor has not made, and
will not make, any agreement which (i) prohibits or restricts the pledging or creation of lien upon the Owned Hotels, if any, which Guarantor owns or (ii) creates a lien on the Owned Hotels, if any, which Guarantor owns (other than those
agreements granting the Liens noted on Schedules III and IV to the Loan Agreement). 
 (d) The
execution, delivery and performance of this Guaranty will not violate any Requirement of Law or any Contractual Obligations of Guarantor the violation of which could have a material adverse effect on the business, operations, assets or financial or
other condition of Guarantor. 
 (e) Guarantor is not an “investment company” or a company “controlled” by
an “investment company” within the meaning of the Investment Company Act of 1940, as amended. 
 (f) Neither
Guarantor nor any of the Subsidiaries of Guarantor, if any, is engaged or will engage, principally or as one of its important activities, in the business of extending credit for the purpose of “purchasing” or “carrying” any
“margin stock” within the respective meanings of such terms under Regulation U. No part of the proceeds of any Loan made under the Loan Agreement will be used, directly or indirectly, for “purchasing” or “carrying”
“margin stock” as so defined or for any purpose which violates, or which would be inconsistent with, the applicable provisions of the Regulations of the Board of Governors of the Federal Reserve System. 
 (g) No consent, approval, authorization of, or registration, declaration or filing with, any Governmental Authority is required on the
part of Guarantor in connection with the execution and delivery of the Loan Documents to which Guarantor is a party or the performance of or compliance with the terms, provisions and conditions hereof or thereof. 
 (h) To the extent of Guarantor’s actual control and knowledge, Guarantor shall (i) operate its hotels, if any, in material
compliance with the terms of any Franchise Agreements in effect as of the date hereof; (ii) promptly perform and observe (or cause to 

  

 6 

 
be performed or observed) all of the material covenants required to be performed and observed by it under the Franchise Agreements and do all things
necessary to preserve and to keep unimpaired its material rights thereunder; (iii) promptly notify Lender of any event of default under the Franchise Agreements of which it is aware; and (iv) promptly enforce the performance and observance
of all of the covenants required to be performed and observed by the franchisor under the Franchise Agreements. To the extent of Guarantor’s actual control and knowledge, without Lender’s prior consent, Guarantor shall not, and shall not
permit the lessee under any percentage lease or any manager to: (i) surrender, terminate or cancel any Franchise Agreement; (ii) reduce or consent to the reduction of the term of any Franchise Agreement; (iii) increase or consent to
the increase of the amount of any charges under any Franchise Agreement; (iv) otherwise modify, change, supplement, alter or amend, or waive or release any of its rights and remedies under, any Franchise Agreement or (v) suffer or permit
the occurrence of continuance a default beyond any applicable cure period under any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved by Lender) if such default permits the franchiser to terminate or
cancel any Franchise Agreement (or any successor franchise agreement with a national hotel chain approved by Lender). 
 (i)
Guarantor is not and shall not be a party to any Indebtedness other than (i) the Indebtedness evidenced by this Guaranty and (ii) the Indebtedness listed on Schedule III to the Credit Agreement, and Guarantor shall not incur
any additional Indebtedness on or secured by (including, without limitation, by any Lien, pledge, encumbrance or hypothecation of or on) any Hotel property owned by Guarantor, other than that Indebtedness contemplated on Schedules III
and IV of the Loan Agreement. 
 (j) Guarantor shall maintain its corporate existence and obtain and
maintain all rights, privileges, licenses, approvals, franchises, properties and assets necessary or desirable in the normal conduct of its business, and comply with all Contractual Obligations and Requirements of Law, in each case applicable to the
conduct of its business, except where the failure to so comply is not likely to have a material adverse effect on the business, operations, assets or financial or other condition of Guarantor. 
 (k) Guarantor shall pay or otherwise satisfy at or before maturity or before it becomes delinquent or accelerated, as the case may be, all
its Indebtedness (including taxes), except Indebtedness being contested in good faith by appropriate proceedings and for which provision is made to the satisfaction of Lender for the payment thereof in the event Guarantor is found to be obligated to
pay such Indebtedness and which Indebtedness is thereupon promptly paid by Guarantor. 
 (l) Guarantor shall keep proper books
of record and account in which full, true and correct entries in conformity with GAAP and all Requirements of Law shall be made of all dealings and transactions in relation to its business and activities. 
 (m) Guarantor shall not sell, lease, assign, transfer or otherwise dispose of any of its assets (other than obsolete or worn out
property), whether now owned or hereafter 

  

 7 

 
acquired, other than in the ordinary course of business and at fair market value, without the prior written consent of Lender. 
 12. This Guaranty shall be deemed to be made under and shall be governed by the laws of the State of North Carolina. 
 13. If any of the provisions of this Guaranty shall contravene or be held invalid under the laws of any jurisdiction, this Guaranty shall be construed as
if not containing those provisions and the rights and obligations of the parties hereto shall be construed and enforced accordingly. 
 [SIGNATURE ON NEXT PAGE] 
  

 8 

 Executed and sealed as of the day and year first above written. 
  

					
	SUNBELT-CHM, L.L C., an Alabama corporation
		
	By:	 	Apple Seven Hospitality Ownership, Inc.,
a Virginia corporation,
its sole member
			
		 	By:	 	/s/ Justin G. Knight
		 	Name:	 	Justin G. Knight
		 	Title:	 	PresidentPURCHASE CONTRACT BETWEEN INTEREST OWNERS, SUNBELT-COLUMBUS AND APPLE SEVEN

 Exhibit 10.49 
 Hotel: Columbus, GA (FI&S) 
 PURCHASE CONTRACT 
 between 
 Larry Blumberg

 Watson & Downs Investments, L.L.C., 
 Robert Hayne Hollis, III 
 Richard Blumberg 
 Barry Kraselsky 
 Helen B. Lifland

 (“INTEREST OWNERS”), 
 SUNBELT – COLUMBUS, L.L.C. 
 (“COMPANY”), 
 AND 
 APPLE SEVEN HOSPITALITY
OWNERSHIP, INC. 
 (“BUYER”) 
 Dated: January 16, 2007 

 TABLE OF CONTENTS 
  

					
	 	  	 	  	Page No.
	 ARTICLE I
	  	 DEFINED TERMS
	  	S-1
			
	 1.1
	  	Definitions	  	S-1
			
	 ARTICLE II
	  	 PURCHASE AND SALE; PURCHASE PRICE; PAYMENT; EARNEST MONEY DEPOSIT
	  	10
			
	 2.1
	  	Purchase and Sale	  	10
	 2.2
	  	Purchase Price	  	10
	 2.3
	  	Allocation	  	10
	 2.4
	  	Payment	  	10
	 2.5
	  	Escrow Amount and Use of Escrow Account	  	10
	 2.6
	  	Earnest Money Deposit	  	11
			
	 ARTICLE III
	  	 Review Period
	  	11
			
	 3.1
	  	Review Period	  	11
	 3.2
	  	Due Diligence Examination	  	13
	 3.3
	  	Restoration and Indemnity	  	13
	 3.4
	  	Exhibits	  	14
			
	 ARTICLE IV
	  	 SURVEY AND TITLE APPROVAL
	  	14
			
	 4.1
	  	Survey	  	14
	 4.2
	  	Title	  	14
	 4.3
	  	Survey or Title Objections	  	15
			
	 ARTICLE V
	  	 MANAGEMENT AGREEMENT AND FRANCHISE AGREEMENT
	  	15
			
	 ARTICLE VI
	  	 BROKERS
	  	16
			
	 ARTICLE VII
	  	 REPRESENTATIONS, WARRANTIES AND COVENANTS
	  	16
			
	 7.1
	  	Representations, Warranties and Covenants of Interest Owners	  	16
	 7.2
	  	Representations, warranties and covenants of Buyer	  	28
	 7.3
	  	Survival	  	28
			
	 ARTICLE VIII
	  	 ADDITIONAL COVENANTS
	  	28
			
	 8.1
	  	Subsequent Developments	  	28
	 8.2
	  	Operations	  	28
	 8.3
	  	Third Party Consents	  	30

  

 ii 

					
	 8.4
	  	Employees	  	30
	 8.5
	  	Estoppel Certificates	  	31
	 8.6
	  	Access to Financial Information	  	31
	 8.7
	  	Bulk Sales	  	31
	 8.8
	  	Indemnification	  	31
	 8.9
	  	Limitations on Liability of Interest Owners	  	34
	 8.10
	  	Contingent Claims for Reserves	  	34
	 8.11
	  	Tax Matters	  	35
			
	 ARTICLE IX
	  	 CONDITIONS FOR CLOSING
	  	35
			
	 9.1
	  	Buyer’s Conditions for Closing	  	35
	 9.2
	  	Interest Owner’s Conditions for Closing	  	36
			
	 ARTICLE X
	  	 CLOSING AND CONVEYANCE
	  	37
			
	 10.1
	  	Closing	  	37
	 10.2
	  	Interest Owners’ Deliveries	  	37
	 10.3
	  	Buyer’s Deliveries	  	38
	 10.4
	  	Tax Matters	  	38
			
	 ARTICLE XI
	  	 COSTS
	  	40
			
	 11.1
	  	Interest Owner’s Costs	  	40
	 11.2
	  	Buyer’s Costs	  	40
			
	 ARTICLE XII
	  	 ADJUSTMENTS
	  	41
			
	 12.1
	  	Adjustments	  	41
	 12.2
	  	Reconciliation and Final Payment	  	42
	 12.3
	  	Employees	  	43
			
	 ARTICLE XIII
	  	 CASUALTY AND CONDEMNATION
	  	43
			
	 13.1
	  	Risk of Loss; Notice	  	43
	 13.2
	  	Buyer’s Termination Right	  	43
	 13.3
	  	Procedure for Closing	  	44
			
	 ARTICLE XIV
	  	 DEFAULT REMEDIES
	  	44
			
	 14.1
	  	Buyer Default	  	44
	 14.2
	  	Interest Owner/Company Default	  	44
	 14.3
	  	Attorney’s Fees	  	45
			
	 ARTICLE XV
	  	 NOTICES
	  	45

  

 iii 

					
	 ARTICLE XVI
	  	 MISCELLANEOUS
	  	46
			
	 16.1
	  	Performance	  	46
	 16.2
	  	Binding Effect; Assignment	  	46
	 16.3
	  	Entire Agreement	  	46
	 16.4
	  	Governing Law	  	46
	 16.5
	  	Captions	  	46
	 16.6
	  	Confidentiality	  	46
	 16.7
	  	Closing Documents	  	47
	 16.8
	  	Counterparts	  	47
	 16.9
	  	Severability	  	47
	 16.10
	  	Interpretation	  	47
	 16.11
	  	Intentionally Omitted	  	47
	 16.12
	  	Further Acts	  	47
	 16.13
	  	Joint and Several Obligations	  	47
			
	 ARTICLE XVII
	  	 SUPPLEMENTAL PROVISIONS
	  	47

 SCHEDULES: 
  

			
	 Schedule 1
	  	Hotel Specific Data
	 Schedule 2
	  	Supplemental Provisions
	 Schedule 2.5
	  	PIP Improvements
	 Schedule 7.1(j)
	  	Litigation
	 Schedule 7.1(l)
	  	Condemnation Proceedings
	 Schedule 7.1(m)
	  	Leases
	 Schedule 7.1(n)
	  	Trade Marks and Trade Names
	 Schedule 7.1(p)(iv)
	  	Tax Returns
	 Schedule 7.1(q)
	  	Insurance
	 Schedule 7.1(r)
	  	Agreements

 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
	  	(Intentionally Omitted)
	 Exhibit H
	  	(Intentionally Omitted)
	 Exhibit I
	  	New Management Agreement
	 Exhibit J
	  	Allocation of Purchase Price

  

 iv 

 PURCHASE CONTRACT 
 This PURCHASE CONTRACT (this “Contract”) is made and entered into as of the date set forth in Item 1 of Schedule 1 by
and between the persons and entities set forth in Item 2(a) of Schedule 1 (each, an “Interest Owner” and, collectively, the “Interest Owners”), with an address c/o Larry Blumberg &
Associates, Inc., 2733 Ross Clark Circle, P.O. Box 5566, Dothan, Alabama 36302; the entity set forth in Item 2(b) of Schedule 1 (the “Company”), with its principal office c/o Larry Blumberg & Associates,
Inc., 2733 Ross Clark Circle, P.O. Box 5566, Dothan, Alabama 36302; and APPLE SEVEN 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. The Company is the fee simple or leasehold owner of the hotel property identified in Item 3 of Schedule 1 attached hereto and incorporated herein by reference. 
 B. The Interest Owners are the sole owners of one hundred percent (100%) of the limited liability company interests or stock, as applicable, in the
Company. 
 C. Buyer desires to purchase from the Interest Owners, and the Interest Owners desire to sell to Buyer, all of Interest
Owner’s interests in the Company 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 Agreement shall have the meanings set forth below unless the context otherwise requires: 
 “Additional Deposit” shall mean $100,000. 
 “Affiliate” shall mean, with
respect to the Company, any Interest Owner 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 the Company,
any Interest Owner 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 

  

					
		  	S-1	  	Purchase Contract

 
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. 
 “Agreement” means any agreement, contract, obligation, promise or undertaking (whether written or oral and
whether express or implied) that is or purports to be legally binding. 
 “Appurtenances” shall mean all rights, titles, and
interests of the Company 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. 
 “Assumed Loan” shall mean the loan, if any, identified in Item 10 of Schedule 1; if no loan is so identified, the term “Assumed Loan” shall be disregarded for purposes of this Contract.

 “Brand” shall mean the hotel brand or franchise identified in Item 5 of Schedule 1 and under which the
Hotel operates. 
 “Business Day” shall mean any day other than a Saturday, Sunday or legal holiday in the Commonwealth of
Virginia, the State of Florida or the state in which the Hotel is located. 
 “Closing” shall mean the closing of the
purchase and sale of the Interests pursuant to this Contract. 
 “Closing Date” shall have the meaning set forth in
Section 10.1. 
 “Code” means the Internal Revenue Code of 1986, as amended. 
 “Company Intellectual Property” shall have the meaning set forth in Section 7.1(n). 
 “Contemplated Transactions” shall mean all of the transactions contemplated by this Contract and the Exhibits hereto. 
 “Contract” shall mean this Purchase Contract, as amended from time to time pursuant to the terms hereof. 
 “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. 
 “Deposits” shall mean, to the
extent assignable, all prepaid rents and deposits (including, without limitation, any reserves for capital repairs and/or improvements), including, but not limited to, refundable security deposits and rental deposits and all other deposits for
advance 

  

 2 

 
reservations, banquets or future services, made in connection with the use or occupancy of the Improvements, all reserves for replacement of FF&E,
reserves for real property taxes and insurance and utility deposits, credit for which shall be given to the Interest Owners to the extent hereinafter provided. 
 “Due Diligence Examination” shall have the meaning set forth in Section 3.2. 
 “Earnest Money Deposit” shall have the meaning given in Section 2.6. 
 “Effective
Date” shall mean the date this Contract is fully executed by all of the parties hereto, and an original of the executed document (which may be in the form of counterparts, in which case the last counterpart) is deposited with the Title
Company. 
 “Employee Plan” means, with respect to an employer, all “employee benefit plans” as defined by
Section 3(3) of ERISA, all specified fringe benefit plans as defined in Section 6039D of the Code, and all other bonus, incentive compensation, deferred compensation, profit sharing, stock option, stock appreciation right, stock bonus,
stock purchase, employee stock ownership, savings, severance, change in control, supplemental unemployment, layoff, salary continuation, retirement, pension, health, life insurance, disability, accident, group insurance, vacation, holiday, sick
leave, fringe benefit or welfare plan, and any other employee compensation or benefit plan, agreement, policy, practice, commitment, contract or understanding (whether qualified or nonqualified, currently effective or terminated, written or
unwritten) and any trust, escrow or other agreement related thereto that (i) is maintained or contributed to by any such employer or any ERISA Affiliate or has been maintained or contributed to in the last six (6) years by any such
employer or any ERISA Affiliate, or with respect to which any such employer or any ERISA Affiliate has or may have any liability, and (ii) provides benefits, or describes policies or procedures applicable to any current or former director,
officer, employee or service provider of any such employer or any ERISA Affiliate, or the dependents of any thereof, regardless of how (or whether) liabilities for the provision of benefits are accrued or assets are acquired or dedicated with
respect to the funding thereof. 
 “Environment” means soil, land surface or subsurface strata, surface waters (including
navigable waters and ocean waters), groundwaters, drinking water supply, stream sediments, ambient air (including indoor air), plant and animal life and any other environmental medium or natural resource. 
 “Environmental Requirements” shall have the meaning set forth in Section 7.1(v)(iii). 
 “ERISA” means the Employee Retirement Income Security Act of 1974. 
 “ERISA Affiliate” means, with respect to an employer, any other corporation or trade or business controlled by, controlling or under
common control with such employer (within the meaning of Section 414 of the Code, or Sections 4001(a)(14) or 4001(b) of ERISA). 
  

 3 

 “Escrow Account” means a separate account established and controlled by Buyer for the
purpose of holding and disbursing the Escrow Amount in accordance with Section 2.5 hereof, which account Buyer, for its convenience, may use and commingle escrow amounts from other purchase contracts between Buyer and Affiliates of the
Company executed simultaneously or of even date herewith. 
 “Escrow Amount” means that sum of money withheld from the
Purchase Price and retained in the Escrow Account by Buyer, such amount to equal one hundred fifty percent (150%) of the following obligations of the Company: (i) the total amount of accounts payable for the Hotel attributable to the
period before the Closing Date and (ii) the costs of completing those certain improvements listed on the attached Schedule 2.5, if any, required by Franchisor to be made pursuant to Franchisor’s existing PIP. The estimated portion
of the Escrow Amount to be withheld under this Contract for the items mentioned in clause (ii) above is set forth in Schedule 1. 
 “Escrow Agent” shall mean LandAmerica American Title Company, the Person serving as escrow agent for purposes of the Earnest Money Deposit. 
 “Exception Documents” shall have the meaning set forth in Section 4.2. 
 “Existing Franchise Agreement” shall mean the franchise agreement identified in Item 9 of Schedule 1. 
 “Existing Management Agreement” shall mean the management agreement identified in Item 7 of Schedule 1. 
 “Existing Manager” shall mean LBAM-Investor Group, L.L.C., an Alabama limited liability company and an Affiliate of the Company. 
 “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 the Company pursuant to an FF&E Lease), 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. 
  

 4 

 “FF&E Leases” shall mean all leases of any FF&E and other contracts permitting
the use of any FF&E at the Improvements. 
 “Franchisor” shall mean the franchisor identified in Item 8 of
Schedule 1; if no franchisor is so identified, the term “Franchisor” shall be disregarded for purposes of this Contract. 
 “Governmental Body” means any (i) nation, state, county, city, town, borough, village, district or other jurisdiction; (ii) federal, state, local, municipal, foreign or other government; (iii) governmental or
quasi–governmental authority of any nature (including any agency, branch, department, board, commission, court, tribunal or other entity exercising governmental or quasi–governmental powers); (iv) multinational organization or body;
(v) body exercising, or entitled or purporting to exercise, any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power; or (vi) any official of any of the foregoing. 
 “Hazardous Material” shall have the meaning set forth in Section 7.1(v)(iii). 
 “Hotel” shall mean the hotel located on the Land, including all Improvements and Personal Property associated therewith, known generally
by the name and/or identification set forth in Item 3(a) of Schedule 1. 
 “Hotel Contracts” shall have
the meaning given in Section 7.1(v)(i). 
 “Hotel Financial Statements” shall have the meaning set forth in
Section 3.1(b). 
 “Improvements” shall mean all buildings, structures, fixtures, parking areas and other
improvements to the Land, including, without limitation, all improvements and amenities described in Item 3 of Schedule 1 and all related facilities. 
 “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 Earnest
Money Deposit” shall have the meaning given in Section 2.6. 
 “Interest” shall mean the limited
liability company interest or corporate stock, as applicable, owned by each Interest Owner in the Company, and “Interests” shall mean all of such limited liability company interests or corporate stock. 
 “Interest Lien” shall mean any claim, lien, pledge, charge, security interest, equitable interest, option, warrant, right of first
refusal, restriction on use, voting, transfer, receipt of income or other attribute of ownership, or other encumbrance of any kind, affecting any Interest. 
 “Land” shall mean the real property described in Exhibit A, which is attached hereto and incorporated herein by reference, together with all rights (including without limitation all air rights
and development rights), alleys, streets, strips, gores, waters, privileges, appurtenances, 

  

 5 

 
advantages and easements belonging thereto or in any way appertaining thereto, and all other Appurtenances. 
 “Leased Premises” shall have the meaning set forth in Section 7.1(m). 
 “Leases” shall mean all leases, 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). 
 “Legal Requirement” means any federal, state, local, municipal, foreign, international, multinational or other constitution, law, ordinance, principle of common law, code, regulation, rule, order, injunction, judgment,
decree, ruling, assessment or arbitration award of any Governmental Body or arbitrator. 
 “Lender” shall mean the lender
identified in Item 11 of Schedule 1; if no such lender is so identified, the term “Lender” shall be disregarded for purposes of this Contract. 
 “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. 
 “New
Franchise Agreement” shall mean the franchise agreement to be entered into by the Company and the Franchisor at the Closing. 
 “New Management Agreement” shall mean the management agreement to be entered into by the Company and the New Manager at the Closing, in the form of the agreement attached hereto as Exhibit I. 
 “New Manager” shall mean LBAM-Investor Group, L.L.C., an Alabama limited liability company and an Affiliate of the Company as of the
date of this Contract. 
 “Organizational Documents” means (a) the articles or certificate of incorporation and the
bylaws of a corporation; (b) the partnership agreement and the certificate of partnership of a partnership; (c) the articles of organization or certificate of formation and any operating or limited liability company agreement of a limited
liability company; (d) any charter or similar 

  

 6 

 
document adopted or filed in connection with the creation, formation, or organization of a Person, and (e) any amendment to any of the foregoing.

 “Pending Claims” shall have the meaning set forth in Section 7.1(v)(ii). 
 “Permitted Exceptions” shall have the meaning set forth in Section 4.3. 
 “Person” means an individual or any entity, including a corporation, partnership, joint venture, limited liability company, trust,
estate or other unincorporated association, whether or not a legal entity. 
 “Personal Property” shall mean, collectively,
all of the Property other than the Real Property. 
 “PIP” shall mean a product improvement plan for the Hotel, as required
by the Franchisor. 
 “Post-Closing Claims” shall have the meaning given in Section 8.10(a). 
 “Post-Closing Claim Period” shall have the meaning given in Section 8.10(a). 
 “Post-Closing Reserves” shall have the meaning given in Section 8.10(a). 
 “Pre-Closing Tax Period” shall have the meaning given in Section 10.4(a). 
 “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 the Company 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 currently in effect, Licenses, Tradenames, Contracts, Plans and Specs and FF&E Lease. 
 “Property Lien” means any deed of trust or mortgage, lien, security interest, easement, right of way, encroachment, lease, purchase contract, option to purchase, right of first refusal, servitude, restrictive covenant,
limitation on use or other encumbrance or title defect of any kind. 
 “Purchase Price” shall have the meaning set forth in
Section 2.2. 
 “Real Property” shall mean, collectively, all Land and Improvements 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 Franchisor), marketing 

  

 7 

 
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 the Company’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, and all Tax Returns and work papers and filings related to Taxes for the current tax year and the previous three (3) tax years) owned by the Company and/or in the Company’s possession or control, or to which the Company has
access or may obtain from the Existing Manager or the Franchisor, 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 the Company shall furnish to Buyer (and the
term “Records” shall include) 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 currently in effect and
copies of the final plans and specifications for the Hotel, it being understood that the Company may not have in its possession all change orders and other modifications to the original plans and specifications. 
 “Release” shall have the meaning set forth in Section 7.1(v)(iii). 
 “Review Period” shall have the meaning set forth in Section 3.1. 
 “SEC” shall have the meaning set forth in Section 8.6. 
 “Securities Act” means the Securities Act of 1933, as amended. 
 “Seller Liens” shall have the meaning set forth in Section 4.3. 
 “Service Contracts” shall mean contracts or agreements, such as maintenance, supply, service or utility contracts. 
 “Straddle Period” shall have the meaning given in Section 10.4(b). 
 “Supplemental Provisions” shall have the meaning set forth in Article XVII. 
 “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, 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 

  

 8 

 
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. 
 “Tax” or “Taxes” means any income, gross receipts, license, payroll,
employment, excise, severance, stamp, occupation, premium, property, environmental, windfall profit, customs, vehicle, airplane, boat, vessel or other title or registration, capital stock, franchise, employees’ income withholding, foreign or
domestic withholding, social security, unemployment, disability, real property, personal property, sales, use, transfer, value added, alternative, add-on minimum and other tax, fee, assessment, levy, tariff, charge or duty of any kind whatsoever and
any interest, penalty, addition or additional amount thereon imposed, assessed or collected by or under the authority of any Governmental Body or payable under any tax-sharing agreement or any other Contract, including any interest, penalty, or
addition thereto, whether disputed or not and including any obligations to indemnify or otherwise assume or succeed to the Tax liability of any other Person. 
 “Tax Return” means any return (including any information return), report, statement, schedule, notice, form, declaration, claim for refund or other document or information filed with or submitted to,
or required to be filed with or submitted to, any Governmental Body in connection with the determination, assessment, collection or payment of any Tax or in connection with the administration, implementation or enforcement of or compliance with any
Legal Requirement relating to any Tax. 
 “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 all 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 remain in full force and effect after the acquisition of the Interests by Buyer). 
 “Utility
Reservations” shall mean the Company’s interest in the right to receive and continuously consume (including, without limitation, from and after Closing) water service, 

  

 9 

 
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. 
 “Warranties” shall mean all warranties, guaranties, indemnities and claims, currently in effect, for the benefit of the Company 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 the Company related thereto. 
 ARTICLE II 
 PURCHASE AND SALE; PURCHASE PRICE; PAYMENT; 
 EARNEST MONEY DEPOSIT 
 2.1 Purchase and Sale. Each Interest Owner agrees to sell and convey to Buyer or its Affiliates and/or assigns, and Buyer or its assigns agrees to
purchase from the Interest Owners, all of the Interests, in consideration of the Purchase Price, subject to and upon the terms and conditions hereof. All of the Interests shall be conveyed, assigned, and transferred to Buyer at Closing, free and
clear of all Interest Liens. 
 2.2 Purchase Price. Buyer agrees to pay, and the Interest Owners agree to accept, as consideration for
the conveyance of all of the Interests, subject to the adjustments provided for in this Contract, the amount set forth in Item 12 of Schedule 1 (the “Purchase Price”), less the outstanding principal balance of the
Assumed Loan, if any, as of the Closing Date. 
 2.3 Allocation. The Purchase Price shall be allocated among the Interest Owners in
accordance with their percentage interest in the Company as set forth in Item 2(a) of Schedule 1. 
 2.4 Payment.
The Purchase Price, plus any positive adjustments under Section 12.1, less (i) the Earnest Money Deposit and interest earned thereon, if any, which Buyer elects to have applied against the Purchase Price (as provided below),
(ii) the principal balance of any Assumed Loan, (iii) the Escrow Amount, (iv) the Post-Closing Reserves and (v) any negative adjustments under Section 12.1, shall be paid to the Interest Owners in cash, certified
funds or wire transfer, at the Closing of the purchase and sale of the Interests. 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 the Interest Owners by Escrow Agent to be applied to the Purchase Price on behalf of Buyer. 
 2.5 Escrow Amount and Use of Escrow
Account. Buyer shall withhold the Escrow Amount from the Purchase Price due at Closing, which Escrow Amount shall be deposited into 

  

 10 

 
the Escrow Account. Funds held in the Escrow Account shall be applied to pay (i) accounts payable for the Hotel attributable to the period before the
Closing and (ii) the cost of the improvements listed on Schedule 2.5, if any, which are required by the Franchisor under its existing project improvement plan. As invoices for accounts payable or PIP expenditures are received by the New
Manager or the Company, such invoices shall be submitted to Buyer, with a copy to Interest Owners, and Buyer shall release from the Escrow Account sums sufficient to pay all such invoices. If the Escrow Amount is insufficient to pay all of such
accounts payable and PIP expenditures, the Interest Owners shall pay such excess amount to Buyer promptly after Buyer or the Company submits an invoice therefor. Upon completion of the PIP and payment of all costs therefor and upon Buyer’s
receipt of a certificate from Interest Owners certifying that all accounts payable attributable to the period before the Closing have been paid, all remaining funds in the Escrow Account shall be released to the Interest Owners. 
 2.6 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 Thousand and No/100 Dollars ($100,000.00) 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 (if any), and all interest accrued thereon, shall hereinafter be referred to as the “Earnest Money Deposit.” 
 (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 thirty (30) days after the Effective Date,
unless a longer period of time is otherwise provided for in this Contract and except as otherwise agreed to by the parties hereto (the “Review Period”), to evaluate the legal, title, survey, construction, engineering, physical
condition, 

  

 11 

 
structural, mechanical, environmental, zoning, economic, permit status, franchise status, marketing and economic data, financial statements and information,
property statements, franchise agreements, loan documents and other documents and information related to the Property and the business of the Hotel, including any and all documents to which Buyer may be come obligated with respect to the Assumed
Loan, if any. Within two (2) Business Days following the Effective Date, the Company, at the sole cost and expense of the Interest Owners, 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 currently in effect 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 all prior years in which the Hotel was
operational (the “Hotel Financial Statements”), provided that the Company 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, which the Company has in its possession or control. Buyer acknowledges that the
Contracts, Plans and Specs in the Company’s possession may not include all change orders and other modifications made during the course of construction of the Hotel, but in such case the Company will cause the general contractor for the Hotel
to furnish copies of such change orders and other modifications upon Buyer’s request at any time during the Review Period; 
 (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 the
Company in connection therewith; and 
 (f) All notices received from governmental authorities in connection with the Hotel
for the current year and each of the three (3) calendar years prior to the current year and all 

  

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other notices received from governmental authorities received at any time that relate to any noncompliance or violation of law that has not been corrected.

 The Company 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 the Company’s corporate offices, and the Company 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 Hotel and the plans and 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 the Company, in which event: (i) the Initial 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 the Company to Buyer shall be returned promptly to the Company, and (iv) the 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. Upon expiration of the Review Period, Buyer may not terminate this Contract and receive a refund of the Earnest Money Deposit for any reason except the failure of
any of the conditions set forth in Section 9.1. 
 Buyer acknowledges and agrees that certain of the items requested to be
delivered to Buyer in this Section 3.1 have been delivered to and received by Buyer. The Company agrees to cooperate with Buyer and to provide any documents or instruments described herein which have not been delivered by the Company for
Buyer’s due diligence and review. 
 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 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 advance (not less than 24 hours) notice to the Company unless otherwise agreed to by Buyer and the Company (the “Due Diligence Examination”). The Company
shall have the right to have its representative present during Buyer’s physical inspections of the Property, provided that failure of the Company 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 or the Existing Management Agreement or the Existing Franchise Agreement. Buyer may
not conduct a Phase II environmental site assessment or any other invasive environmental procedure without the prior written consent of the Company. 
 3.3 Restoration and Indemnity. 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 

  

 13 

 
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. Buyer further hereby indemnifies and holds the Company and the Interest Owners harmless from and against any damage, personal
injury or death caused by or arising from any action or omission by Buyer, its agents or employees in the examination and study of the Property. 
 3.4 Exhibits. Buyer shall have until the end of the Review Period to review and approve the information on the Exhibits to this Purchase Contract. In the event Buyer does not approve any such Exhibit or the information contained
therein, Buyer shall be entitled to terminate this Contract by notice to the Company, 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. The Company and the Interest Owners, at the Interest Owners’ sole cost and expense, prior to the execution hereof have delivered to Buyer, true, correct and complete copies of the most recent survey of the Real Property. In the
event that an update of the survey or a new survey (such updated or new survey being referred to as the “Survey”) are desired by Buyer, then Buyer shall be responsible for all costs related thereto. 
 4.2 Title. The Company, at the Interest Owners’ sole cost and expense, prior to the execution hereof have delivered to Buyer, within two
(2) Business Days after the execution in full of this Contract, the Company’s existing title insurance policy, including copies of all documents referred to therein, for the Real Property. Buyer’s obligations under this Contract are
conditioned upon Buyer being able to obtain (i) a Commitment for Title Insurance (the “Title Commitment”) issued by LandAmerica American Title Company, 8201 Preston Road, Suite 280, Dallas, Texas 75225, Attention: David Long
(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 Property Liens and pursuant to which the Title Company agrees to issue 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, contiguity, Fairway 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, plats, surveys and Property Liens affecting 

  

 14 

 
the Real Property. Buyer shall promptly provide the Company with a copy of the Title Commitment issued by the Title Company. 
 4.3 Survey or Title Objections. If Buyer discovers any title or survey matter which is objectionable to Buyer, Buyer may provide the Company and
the Interest Owners with written notice of its objection to same within fifteen (15) Business Days after Buyer’s receipt of both the Survey and the Title Commitment, together with copies of all exceptions noted therein (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 the Company and the Interest Owners on or before the expiration of the Title Review Period, the Company and the Interest Owners shall elect either to attempt to cure, at the Interest Owners’ sole cost and
expense, or not cure any such item by written notice sent to Buyer within five (5) days after receipt by the Company and the Interest Owners of notice from Buyer, and if the Company and the Interest Owners commit in writing to attempt to cure
any such item, the Company and the Interest Owners shall be given until the Closing Date to cure any such defect. In the event the Company and the Interest Owners shall fail to cure a defect which they have 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 Survey or the Title Commitment or which are apparent by physical inspection of the Property and
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 than those standard exceptions which are ordinarily and customarily omitted in the state in which the
Hotel is located, so long as the Company and/or the Interest Owners, as the case may be, provide, at the Interest Owners’ sole cost and expense, the appropriate owner’s affidavit, gap indemnity or other documentation reasonably required by
the Title Company for such omission) and the deed of trust securing the Assumed Loan, if any, are hereinafter referred to as the “Permitted Exceptions.” In no event shall Permitted Exceptions include mortgages or other documents
evidencing or securing indebtedness (other than the recorded instruments securing the Assumed Loan, if any), or any mechanics’ or materialmen’s lens 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 the Interest Owners, at the Interest Owners’ sole cost and expense, and released at Closing, except for the deed of trust securing the Assumed Loan, if any. 

ARTICLE V 
 MANAGEMENT AGREEMENT
AND FRANCHISE AGREEMENT 
 The Company has entered into the Existing Management Agreement and the Existing Franchise Agreement for the
operation and management of the Hotel. At the Closing, subject to the approval of the Franchisor, (i) the Company and the Existing Manager shall terminate the Existing Management Agreement, (ii) the Company and the Franchisor shall
terminate the 

  

 15 

 
Existing Franchise Agreement, (iii) the Company and the New Manager shall enter into the New Management Agreement and (iv) the Company and the
Franchisor shall enter into the New Franchise Agreement. The Interest Owners shall be solely responsible for all claims and liabilities arising under the Existing Management Agreement and the Existing Franchise Agreement, whether accruing before or
after the Closing. The Company and the Interest Owners shall obtain the Existing Manager’s consent to the termination of the Existing Management Agreement, and the Company and the Interest Owners shall cause the New Manager to enter into the
New Management Agreement. Before the Closing, the Company and Buyer shall request the Franchisor to approve the transfer of the Interests to Buyer, the termination of the Existing Management Agreement, the execution of the New Management Agreement
and the execution of the New Franchise Agreement. The Company and the Interest Owners shall use their best efforts to promptly provide all information required by the Franchisor in connection with the foregoing request for approval, and the Company,
the Interest Owners and Buyer shall diligently pursue obtaining the Franchisor’s approval. The Interest Owners understand that Buyer expects the New Franchise Agreement to be upon financial terms and conditions no less favorable to the Company
than the Existing Franchise Agreement. 
 ARTICLE VI 
 BROKERS 
 Each Interest Owner, the Company and Buyer represents and warrants to the other that it has
not engaged any broker, finder or other party in connection with the transaction contemplated by this Contract. Each Interest Owner agrees to save and hold harmless Buyer from any and all losses, damages, liabilities, costs and expenses (including,
without limitation, attorneys’ fees) involving claims made by any agent, broker, or other person by or through the acts of any Interest Owner or the Company, as the case may be, in connection with the Contemplated Transactions. Buyer agrees to
save and hold harmless each Interest Owner and the Company from any and all losses, damages, liabilities, costs and expenses (including, without limitation, attorneys’ fees) involving claims made by any agent, broker, or other person by or
through the acts of Buyer in connection with the Contemplated Transactions. 
 ARTICLE VII 
 REPRESENTATIONS, WARRANTIES AND COVENANTS 
 7.1 Representations, Warranties and Covenants of Interest Owners. Each Interest Owner represents, warrants and covenants to Buyer as follows: 
 (a) Organization and Existence of the Company. The Company is a limited liability company or corporation duly organized or
incorporated and validly existing under the laws of the state indicated in Item 2(b) of Schedule 1, and the Company has the full power and authority to own all of its property and assets and to carry on its business as presently
conducted. The Company is not required to qualify to transact business in any jurisdiction other than the state is which it is organized or incorporated. The copies of the Company’s Organizational 

  

 16 

 
Documents that the Company has delivered to Buyer or delivers to Buyer during the Review Period are or will be true, correct and complete copies of the
Organizational Documents of the Company as in effect as of the date hereof and have not been amended or supplemented further. The Company is not a general or limited partner of, or a party to any joint venture with, any other entity and does not,
directly or indirectly, own any interest in any other Person. 
 (b) Authorization and Validity. Each Interest Owner
and the Company have the power and authority to execute and deliver this Contract and the other agreements contemplated hereby and to consummate the Contemplated Transactions. This Contract has been duly executed and delivered by and constitutes a
valid and binding agreement of the Company, each Interest Owner, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency or similar laws. The execution and delivery hereof by the Company and each Interest Owner and the
consummation by the Company and each Interest Owner of such transactions have been fully authorized by the Company and each Interest Owner. 
 (c) Ownership of Interests. The Interest Owners are the owners of all of the Interests, each owning the percentage set forth in Item 2(a) of Schedule 1, and have good and valid title thereto,
with no restrictions on, or any agreements with respect to, voting rights or any other incidents of ownership thereof, except as set forth in the Company’s Organizational Documents. The Interests represent one hundred percent (100%) of the
record and beneficial interests in the Company and all other right, title and interest in and to the equity of the Company. The Interest Owners have the absolute right to sell and transfer all of the Interests to Buyer free and clear of all Interest
Liens. Each Interest Owner acquired its Interest in compliance with all applicable laws. On consummation of the Contemplated Transactions, in accordance with the terms hereof, Buyer will acquire good and marketable title to the Interests free and
clear of all Interest Liens. 
 (d) Related Party Transactions. No Interest Owner has any direct or indirect interest
in any property used by, or relating to, the Company, except through the ownership of its Interest. 
 (e)
Non-Contravention. The execution and delivery by each Interest Owner and the Company of this Contract and the other agreements contemplated hereby do not, and the consummation by each Interest Owner and the Company of the transactions
contemplated hereby or thereby will not (i) violate any provision of the any Organizational Documents of any Interest Owner or the Company, (ii) violate, or result with the passage of time in a violation of, any provision of, or result in
the acceleration of or entitle any party to accelerate any obligation under, or result in the creation or imposition of any Property Lien upon, any of the property of any Interest Owner or the Company pursuant to any provision of any mortgage, deed
of trust, lease, agreement, license or instrument to which any Interest Owner or the Company is a party or to which any of them is subject (collectively, the “Restrictive Documents”) except to the extent consents, waivers,
satisfactions or terminations therefor will be delivered on or before Closing, (iii) constitute an event permitting termination of any mortgage, deed of trust, lease, agreement, 

  

 17 

 
license or instrument to which any Interest Owner or the Company is a party, except for those Restrictive Documents which represent obligations to be
satisfied or for which consents to assignment or waivers of termination will be delivered on or before Closing or (iv) violate any judgment, order, writ, injunction, decree, regulation or rule of any court or governmental authority applicable
to any Interest Owner or the Company or the assets of any of them. 
 (f) Consents and Approvals. No consent, approval,
notification, authorization or order of, or declaration, filing or registration with, any governmental agency, is required to be obtained or made by the Company or any Interest Owner in connection with the consummation by the Company and each
Interest Owner of the Contemplated Transactions. 
 (g) Financial Statements. The Company’s financial statements
for the fiscal years 2003 through 2006 (the “Company Financial Statements”), copies of which have been delivered to Buyer or will be delivered to Buyer during the Review Period, (i) were prepared in accordance with the books
and records of the Company in the ordinary course of its business, consistently applied, (ii) are correct, complete and accurate and (iii) fairly present the assets, liabilities and financial position of the Company as of the date thereof
and the results of operations, cash flows and changes in its financial position for the period then ended. 
 (h) Absence
of Certain Changes or Events. There has not been since the date of the Company Financial Statements: 
 (i) any material
adverse change in the business, financial condition, assets, liabilities, income or prospects of the business of the Company; 
 (ii) any damage, destruction and other casualty loss (whether or not covered by insurance) having a material adverse effect on the financial condition, assets, liabilities, income or prospects of the business of the Company; 
 (iii) any change in the accounting methods followed by the Company; 
 (iv) any acquisition or proposed acquisition by the Company of real property or, except in the ordinary course of business, any other
property; 
 (v) any distributions to members or shareholders (whether in cash or property) other than cash on hand or in bank
accounts due to be withdrawn by or distributed to the Interest Owners prior to Closing; or 
 (vi) any increase in any manner
of the compensation of any employees employed at the Hotel or any payment or agreement to pay any pension or retirement allowance to any partner or employee at the Hotel, nor has the Company entered into or amended any employment agreement or any
Employee Plan of the Company or any other arrangement with or for the benefit of any partner, employee or other person, except for 

  

 18 

 
annual reviews and merit increases occurring in the ordinary course of the Company’s business and disclosed in writing to Buyer during the Review
Period. 
 (i) No Undisclosed Liabilities. The Company does not have, as of the date of this Contract, any debts,
liabilities or obligations, whether accrued, absolute, contingent or otherwise, that are material to the financial condition, assets, liabilities, income or prospects of the business of the Company except as set forth in the Company Financial
Statements. 
 (j) Litigation. Except for the items listed on Schedule 7.1(j), there are no actions, suits,
claims, investigations or proceedings (legal, administrative or arbitrative) pending or, to the knowledge of any of the Interest Owners or the Company, threatened against any of the Interest Owners or the Company, whether at law or in equity and
whether civil or criminal in nature, before or by any federal, state, municipal or other court, arbitrator, governmental department, commission, agency or instrumentality, domestic or foreign. There are no judgments, decrees or orders of any such
court, arbitrator, governmental department, commission, agency or instrumentality outstanding against any of the Interest Owners or the Company, (i) which relate to the Company or any Interest Owner and which have or could reasonably be
expected to have an adverse effect on the financial condition, assets, liabilities, income or prospects of the business of the Company, or (ii) which seek specifically to prohibit, restrict or delay consummation of the transactions contemplated
hereby or fulfillment of any of the conditions of this Contract. 
 (k) Title to Properties. The Company has good and
marketable title to all of the Property (whether real, fee or leasehold, personal or mixed, tangible or intangible) and as reflected on the Company Financial Statement and enjoys quiet possession of all such properties and interests, free and clear
of all mortgages and other encumbrances (except for Permitted Exceptions, current taxes and liens which arise by operation of law with respect to obligations not yet due and payable). The Property includes all real estate, intangible assets and
physical assets of the Company and all of the property reasonably required to own and operate the Hotel as presently operated and in accordance with the Existing Franchise Agreement. 
 (l) Condition of Hotel. The Hotel is in good and sufficient repair and operating condition, normal wear and tear excepted. No
governmental agency, or other person having authority over any of the Hotel, has served any notice on any Interest Owner or the Company requiring repairs, alterations or corrections of any existing condition on the Hotel. Except as set forth in
Schedule 7.1(l), there are no pending or, to the knowledge of the Company or any Interest Owner, threatened proceedings for condemnation or the exercise of the right of eminent domain as to any part of the Hotel or for limiting or denying any
right of access thereto. None of the Interest Owners or the Company has any knowledge of any special taxes or assessments relating to any part of the Hotel or any planned public improvements that may result in a special assessment against any part
of the Hotel. 
  

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 (m) Lease of Real and Personal Property. Schedule 7.1(m) sets forth a list
of (a) all leases pursuant to which the Company leases, as lessee, real property (the “Leased Premises”), (b) all leases pursuant to which the Company leases, as lessor, real property, (c) all leases pursuant to which
the Company leases, as lessee, personal property and (d) all prepaid expenses, rents and security deposits paid by or to the Company with respect to any of the foregoing leases. The Company has performed all material obligations required to be
performed by it to date under all leases set forth in Schedule 7.1(m) and is not in default nor, to the best knowledge of the Company and any Interest Owner, alleged to be in default in any material respect under any thereof. To the best
knowledge of [the Company and any Interest Owner, there exists no default, or any event which upon the giving of notice or passage of time would give rise to any default, in the performance of any obligation to be performed by any other party to any
of such leases. Immediately after the Closing, Buyer will possess all right, title and interest of each Interest Owner and the Company will continue to possess its right, title and interest, as the case may be, in and to the leases set forth in
Schedule 7.1(m). 
 (n) Trade Names, Trade Marks, Etc. Subject to the terms of the Existing Franchise Agreement
with respect to trade names, trademarks and service marks licensed thereunder, the Company owns or has the right to use all trade marks, trade names and/or business names used or useful in the business of the Company (the “Company
Intellectual Property”). There are no claims or proceedings pending or, to the knowledge of the Interest Owners or the Company, threatened against the Company asserting that its use of any Company Intellectual Property infringes the rights
of any other person. None of the Interest Owners or the Company has knowledge of any use by the Company that may, with notice or passage of time, give rise to such a claim. The Company has not licensed or otherwise assigned any Company Intellectual
Property to any third party, and there are no existing infringing uses of the Company Intellectual Property by any third parties. Other than the terms of the Existing Franchise Agreement, there are no restrictions or other obligations of the Company
with respect to the ownership or use of the Company Intellectual Property. The trade marks, trade names, service marks and/or business names described on Schedule 7.1(n) include all of the Company Intellectual Property. 
 (o) Governmental Authorization and Compliance with Laws. To the best knowledge of the Company and the Interest Owners, (i) the
business of the Company has been operated in compliance with all laws, orders, regulations, policies and guidelines of all governmental entities (including, without limitation, those relating to building codes and zoning, environmental and safety
matters), (ii) the Company has all permits, certificates, licenses, approvals and other authorizations required in connection with the operation of its business as now conducted, such licenses, permits and approvals are in full force and
effect, and there is no reason to believe that any such license, permit or approval will be recalled, and (iii) each Interest Owner and the Company have complied in all material respects with all applicable laws, regulations and restrictions
relating to the business of the Company, including without limitation laws, regulations and restrictions relating to the Employee Plans of the Company. 
  

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 (p) Taxes. 
 (i) Tax Status. If the Company is a limited liability company, the Company has been treated as a partnership for Tax purposes at
all times during its existence. If the Company is a corporation, the Company made an S election under Section 1362 of the Code upon its formation and, at the time of making such election and at all times thereafter, it qualified as a
“small business corporation” within the meaning of Section 1361(b) of the Code. 
 (ii) Tax Returns.
Each Interest Owner and the Company have filed all Tax Returns that they were required to file under applicable laws and regulations. All such Tax Returns were correct and complete in all respects and were prepared in substantial compliance with all
applicable laws and regulations. All Taxes due and owing by each Interest Owner and the Company (if any), whether or not shown on any Tax Return, have been paid. Neither the Company nor any of the Interest Owners currently is the beneficiary of any
extension of time within which to file any Tax Return. No claim has ever been made by an authority in a jurisdiction where Company or any of the Interest Owners does not file Tax Returns that Company or any of the Interest Owners is or may be
subject to taxation by that jurisdiction. There are no liens for Taxes (other than Taxes not yet due and payable) upon any of the assets of the Company or upon any Interest of any of the Interest Owners. 
 (iii) Withholding. The Company withheld and paid all Taxes required to have been withheld and paid in connection with any amounts
paid or owing to any employee, independent contractor, creditor, stockholder, or other third party 
 (iv) No Expected
Assessments. No Interest Owner or manager or officer (or employee responsible for Tax matters) of the Company expects any authority to assess any additional Taxes for any period for which Tax Returns have been filed. No foreign, federal, state,
or local tax audits or administrative or judicial Tax proceedings are pending or being conducted with respect to the Company or any of the Interest Owners with respect to any item of income, gain, loss, deduction, or credit from the Company. Neither
the Company nor any of the Interest Owners has received from any foreign, federal, state, or local taxing authority (including jurisdictions where the Company or the Interest Owners have not filed Tax Returns) any (i) notice indicating an
intent to open an audit or other review, (ii) request for information related to Tax matters, or (iii) notice of deficiency or proposed adjustment for any amount of Tax proposed, asserted, or assessed by any taxing authority against the
Company or any of the Interest Owners with respect to any item of income, gain, loss, deduction, or credit from the Company. Schedule 7.1(p)(iv) attached hereto lists all federal, state, local, and foreign income Tax Returns filed with
respect to the Company or any Interest Owner for taxable periods ended on or after December 31, 2001, indicates those Tax Returns that have been audited, and indicates those Tax Returns that currently are the subject of audit. The Company has

  

 21 

 
delivered to Buyer correct and complete copies of all federal income Tax Returns, examination reports, and statements of deficiencies assessed against or
agreed to by the Company or the Interest Owner filed or received since December 31, 2001; provided, however, that an Interest Owner is required to deliver such information only for a Tax Return for which there has been a notice of deficiency or
proposed adjustment for any amount of Tax proposed, asserted, or assessed by any taxing authority against the Interest Owner with respect to any item of income, gain, loss, deduction, or credit from the Company. 
 (v) No Extension of Statute of Limitations. Neither the Company nor any of the Interest Owners has waived any statute of
limitations in respect of Taxes or agreed to any extension of time with respect to any Tax assessment or deficiency with respect to any item of income, gain, loss, deduction, or credit from the Company. 
 (vi) Post Closing Inclusion of Income. Neither the Company nor any of the Interest Owners will be required to include any item of
income in, or exclude any item of deduction from, taxable income for any taxable period (or portion thereof) ending after the Closing Date as a result of any: 
 (A) change in method of accounting for a taxable period ending on or prior to the Closing Date; 
 (B) “closing agreement” as described in Code § 7121 (or any corresponding or similar provision of state, local, or foreign
income Tax law); 
 (C) installment sale or open transaction disposition made on or prior to the Closing Date; or 

(D) prepaid amount received on or prior to the Closing Date. 
 (q) Insurance. Schedule 7.1(q) is a true and complete list, showing company, type and amount of coverage, of all insurance
policies carried by the Company for the benefit of the Company or third parties. To the best of the knowledge of the Interest Owners and the Company, the Company is not in default with respect to any provision of any of its insurance policies and
has not failed to give any notice or present any claim thereunder in due or timely fashion or as required by any of such insurance policies which would result in failure to recover in full under such policies. To the best of the knowledge of the
Interest Owners and the Company, the Company has complied with the insurance requirements of all leases and other Agreements to which it is a party. 
 (r) Certain Agreements. Except as listed on Schedule 7.1(r), the Company has no presently existing Agreements, mortgages, leases or profit sharing, savings, consultant, 

  

 22 

 
deferred compensation, retirement, pension or other Employee Plans or benefit arrangements. No Interest Owner has any interest in any of the Property other
than the interest of a member or shareholder under the provisions of the Company’s Organizational Documents. All leases, Agreements, licenses or instruments to which the Company is a party or by which any of its assets or properties are bound
or affected are in full force and effect and binding obligations of the parties thereto. No event or condition has occurred or exists, or is alleged by any of the other parties thereto to have occurred or existed, which constitutes, or with lapse of
time or giving of notice or both might constitute, default or a basis for acceleration of any obligations, force majeure or other claim of excusable delay or non-performance thereunder or in respect thereof, whether on the part of the Company or any
other party. The Company is not a party to any Agreement or any arrangement (whether or not in writing) with any of Interest Owners. 
 (s) Full Disclosure. To the best knowledge of the Company and the Interest Owners, no statement contained in any document, certificate or other writing furnished or to be furnished by the Company or any of the Interest Owners to
Buyer pursuant to the provisions of this Contract contains or shall contain any untrue statement of a material fact or shall omit to state any material fact necessary, in the light of the circumstances under which it was made, to make the statements
therein not misleading. 
 (t) FIRPTA. No Interest Owner is a foreign corporation, foreign partnership, foreign trust
or foreign estate (as those items are defined in the Code and Income Tax Regulations). 
 (u) Bankruptcy. Neither the
Company nor any Interest Owner is insolvent or the subject of any bankruptcy proceeding, receivership proceeding or other insolvency, dissolution, reorganization or similar proceeding. 
 (v) Representations as to the Hotel, Etc. 
 (i) Property Agreements. A complete list of all 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 (collectively, the “Hotel Contracts”). 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 the Company is a party or an assignee, or (ii) 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. The Service Contracts, Leases, Warranties and
FF&E Leases disclosed on Exhibit C 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, or any interest therein or in the Company, other than Buyer. 
  

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 (ii) Pending Claims. Except for any items listed on Schedule 7.1(j), there
are no claims, demands, litigation, proceedings or governmental investigations pending or, to the Interest Owners’ knowledge, threatened related to the business or assets of the Hotel, (ii) any special assessments or extraordinary taxes
except as set forth in the Title Commitment and (iii) any pending or threatened condemnation or eminent domain proceeding 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 Property 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 the knowledge of the Company or any Interest Owner, 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 Property Lien on the Hotel (collectively, the “Pending Claims”). 
 (iii) Environmental. With respect to environmental matters, except as otherwise disclosed in the environmental reports and
documents identified in Exhibit E, (i) to the Company’s and each of the Interest Owner’s knowledge, 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, (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, gas-fired
maintenance equipment 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, to the knowledge of the Company and each of the Interest Owners, threatened, and (v) there are no reports or other documentation regarding the
environmental condition of the Real Property in the possession of the Company, any Interest Owner or their Affiliates, consultants, contractors or agents except for those which have been or during the Review Period will be delivered to Buyer. Buyer
acknowledges that the Property is located in a high humidity belt of the southern United States and that mold and mildew are common. The Company has treated, and until Closing will treat, the Property for mold and mildew as needed in the ordinary
course of business to protect the health of guests and employees of the Hotel and so as to comply with applicable law. As used in this Contract: “Hazardous Materials” means (1) “hazardous wastes” as defined by the
Resource Conservation and 

  

 24 

 
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, or is otherwise regulated by federal, state and local 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. 
 (iv) Title and Liens. The Company has good and marketable fee simple absolute title to the Real Property (or, if so indicated in
Item 4 of Schedule 1, leasehold title to the Land pursuant to the ground lease described therein and fee simple absolute title to the Improvements during the term of such ground lease), subject only to the Permitted Exceptions.
Except for the FF&E subject to the FF&E Leases and any applicable Permitted Exceptions, the Company has good and marketable title to the Personal Property, free and clear of all encumbrances except for the Permitted Exceptions, and there are
no other encumbrances or other rights pending or of which the Company or any Interest Owner has received notice or which are otherwise known to the Company or any Interest Owner related to any other Personal Property. 
 (v) Utilities. All appropriate utilities, including sanitary and storm sewers, water, gas, telephone, cable and electricity, are
currently sufficient and available to service the Hotel and all installation, connection or “tap-on”, usage and similar fees have been paid. 
 (vi) Licenses. The Property has a valid certificate of occupancy for its current use as a hotel and, to the knowledge of the Company and each of the Interest Owners, complies with all applicable Licenses and
Legal Requirements 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. The Company has received all Licenses required or needed for the lawful conduct, occupancy and operation 

  

 25 

 
of the business of the Hotel, and each License is in full force and effect, and will be received and in full force and effect as of the Closing. No Licenses
necessary for the lawful conduct, occupancy or operation of the business of the Hotel requires any approval of a Governmental Body for transfer of Interests except as set forth in Exhibit D. 
 (vii) Hotel Financial Statements. The Company has delivered to Buyer copies of all (i) Hotel Financial Statements,
(ii) operating statements prepared by the Existing Manager or the Company for the Hotel, and (iii) monthly financial statements prepared by the Existing Manager or the Company for the Hotel. Each of such statements is 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 financial condition and results of operations of the Hotel for the respective
periods represented thereby. The Company has relied upon the Hotel 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 Hotel Financial Statements provided to Buyer. 
 (viii) Employees. All
employees employed at the Hotel are the employees of the Company, and, after the Closing, such employees shall be employees solely of the New Manager. No Employee Plans of the Company in effect before the Closing shall be maintained or contributed
to by the Company on or after the Closing, and the Company and the Interest Owners specifically agree that (i) on or before the Closing, all such Employee Plans shall be either terminated or assumed by a Person or Persons other than the Company
and (ii) after the Closing, the Company shall have no responsibility for compliance of any such Employee Plan with any applicable law or regulations or for payment of any contributions, fees, premiums, expenses or penalties with regard to any
such Employee Plan. There are no (w) unions organized at the Hotel, (x) 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, (y) collective bargaining or other labor agreements to which the Company or the Existing Manager or the Hotel is bound with respect to any employees employed at the Hotel, or (z) Employee Plans of the Company that are either a
multiemployer plan as defined in Section 3(37) of ERISA or an employee pension benefit plan subject to Title IV of ERISA. 
 (ix) Operations. The Hotel has at all times been operated by Existing Manager in accordance with all applicable laws, rules, regulations, ordinances and codes. 
 (x) Management Agreement and Franchise Agreement. The Company has furnished to Buyer true and complete copies of the Existing
Management Agreement and the Existing Franchise Agreement, which constitute the entire agreement of the parties with respect to the subject matter thereof and which have not been amended or supplemented in any respect except as provided in
Item 7 of Schedule 1 and Item 9 of 

  

 26 

 
Schedule 1, respectively. 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 the Company 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 the 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 or the Franchisor, subject to the applicable supplemental provisions, if any, set forth in Schedule 2 attached hereto. The Existing Management Agreement and the Existing Franchise Agreement are in full
force and effect. 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. 
 (xi) 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 (as revised by work order or other approval of the Company during construction), 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. The Franchisor inspected and approved the Hotel upon substantial completion and authorized the opening thereof, and any punchlist items required by the Franchisor to be completed after the
opening were completed as required by the Franchisor. 
 (ii) The Personal Property is in good condition and operating order,
normal wear and tear excepted. 
 (iii) All necessary easements for ingress and egress, drainage, signage and utilities
serving the Hotel have been dedicated to the public or conveyed to the appropriate utility or to the Company. 
 (w) Hart
Scott Rodino Filing. All of the assets owned by or in which the Company or any of its Affiliates have a interest are hotels or motels, related improvements such as golf, swimming, tennis, restaurant, health club or parking facilities (but
excluding ski facilities), and assets incidental to the ownership and operation of hotels or motels (e.g., prepaid taxes or insurance, management contracts and licenses to use trademarks associated with the hotel or motel being acquired), as
contemplated by the regulations promulgated under the Hart Scott Rodino Act, except that the Company and its Affiliates each may own other assets but the aggregate value thereof is less than $50,000,000. 
  

 27 

 7.2 Representations, warranties and covenants of Buyer. Buyer represents, warrants and covenants:

 (a) Authority. Buyer is a corporation duly incorporated, 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 consents of the Board of Directors of Buyer and is fully authorized 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, subject to the effect of bankruptcy and
other laws applicable to creditors generally and to equitable principles. 
 (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 one year (i.e., 12 months) expiring on the first anniversary date of the Closing; provided, however, that the representations and warranties set forth in Section 7.1(p) and Section 7.1(v)(viii) shall survive Closing
for a period ending on the later of (i) three (3) years following the date on which the Company files its Tax Return for the tax period ended December 31, 2006 or (ii) the expiration of any applicable statute of limitations that
may be extended. 
 ARTICLE VIII 
 ADDITIONAL COVENANTS 
 8.1 Subsequent Developments. After the date of this Contract and until the Closing Date, the
Company shall keep Buyer fully informed of all subsequent developments (“Subsequent Developments”) which would cause any of the representations or warranties of the Company or the Interest Owners 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, the
Company 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 the
Existing Management Agreement and the Existing Franchise Agreement, and the Interest Owners shall cause the Company to comply, and perform all such obligations: 
  

 28 

 (a) Continue to maintain the Property generally in accordance with past practices and
pursuant to and in compliance with the Existing Management Agreement and the Existing Franchise Agreement, including, without limitation, (i) using best 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 the Company 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; 
 (b) Keep, observe, and perform in all material respects all 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 or the Company; 
 (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 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 Legal Requirements relating to the Hotel; 
  

 29 

 (h) Not sell or assign, or enter into any agreement to sell or assign or create, or
permit to exist any Property Lien (other than a Permitted Exception) on, the Property or any portion thereof; 
 (i) Not allow
any License currently in existence with respect to the operation, use, occupancy or maintenance of the Hotel to expire, be canceled or otherwise terminated; 
 (j) Not incur any indebtedness other than trade payables in the ordinary course; and 
 (k) Not take any other action other than in the ordinary course of business consistent with past practice. 
 The Company shall promptly furnish to Buyer copies of all new, amended or extended FF&E Leases, Service Contracts, Leases and other contracts or
agreements (other than routine hotel room bookings entered into in the ordinary course of business) relating to the Hotel and entered into by the Company or the Existing Manager prior to Closing. Buyer shall have the right to extend the Review
Period for a period of five (5) Business Days in order to review any of the foregoing that are not received by Buyer at least five (5) Business Days prior to the expiration of the Review Period. Without first obtaining the written approval
of Buyer, which approval shall not be unreasonably withheld, the Company shall not, and the Interest Owners shall not permit the Company to, 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 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, Interest Owners, at their expense unless otherwise provided in Section 11.2,
shall (i) obtain the consent of the Lender, if any, to the Contemplated Transactions, (ii) obtain any and all other third party consents and approvals (x) required in order to transfer all of the Interests to Buyer or (y) which,
if not obtained, would materially adversely affect the operation of the Hotel or the value of the Company, including, without limitation, all consents and approvals referred to on Exhibit D and (iii) 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 the Company by Buyer, Buyer and its employees, representatives and agents shall have the right to
communicate with the Company’s staff, 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 the Property or the Franchise Agreement. 
  

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 8.5 Estoppel Certificates. It shall be a condition to Buyer’s obligations under this Contract
that the Company obtain, and the Interest Owners shall cause the Company to 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 each 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 the Company during the Review Period, 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 the Company and the Interest Owners and their 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. Each Interest Owner shall also provide to Buyer’s representative a signed representation letter in form and substance reasonably acceptable to Buyer sufficient to enable an independent public accountant to render an opinion on the
financial statements related to the Hotel. The provisions of this Section shall survive Closing or termination of this Contract. 
 8.7
Bulk Sales. The Interest Owners, at their expense, 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, each Interest Owner hereby agrees to indemnify, defend and hold harmless Buyer and, if the Closing occurs hereunder, the Company and their respective designees, successors
and assigns 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 continent, joint or several, arising out of or relating to: 
 (i) any claim made or asserted against Buyer or the
Company, or any of the Property by a creditor of the Company or any Interest Owner, 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 the Company or any Interest Owner contained in this Contract;

  

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 (iii) any liability or obligation of the Company assumed or incurred prior to the Closing
Date; 
 (iv) any claim made or asserted by any employee of the Company or of the Existing Manager arising out of the transfer
of any Interest and/or the termination of such employee’s employment as a result of the transactions contemplated hereby; 
 (v) the conduct and operation by or on behalf of the Company of the Hotel or the ownership, use or operation of the Property prior to Closing; and 
 (vi) any liability, including without limitation any contributions, fees, premiums, expenses or penalties, with regard to any Employee Plan of the Company or any other Employee Plan covering employees at the Hotel.

 The indemnification under this Section 8.8(a) shall terminate and be of no further force and effect, as to the matters
described in clauses (i) through (v) above, on and after the first anniversary date of the Closing; provided, however, that (A) to the extent any of the representations and warranties survive for a longer period pursuant to
Section 7.3, the foregoing indemnification relating to such representations and warranties shall terminate and be of no further force and effect on and after the expiration of such longer period and (B) the indemnification shall not
terminate as to claims asserted in writing by Buyer or the Company before such first anniversary date or longer period, as the case may be. Any other indemnification by Interest Owners under this Agreement (except for the indemnification as to
matters described in clause (vi) above) also shall terminate and be of further force and effect on and after the first anniversary date of the Closing, except as to claims asserted in writing by Buyer or the Company before such anniversary
date. 
 (b) Indemnification of the Interest Owners. Without in any way limiting or diminishing the warranties,
representations or agreements herein contained or the rights or remedies available to the Interest Owners for a breach hereof, Buyer hereby agrees, with respect to this Contract, to indemnify, defend and hold harmless the Interest Owners 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 the Company of its business at the Hotel after the
Closing; and 
 (iii) the failure of the Company after the Closing to pay any rent or otherwise comply with its obligations
under the ground lease, if any, identified in Item 4 of Schedule 1. 
  

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 The indemnification under this Section 8.8(b) shall terminate and be of no further force and
effect on and after the first anniversary date of the Closing except as to claims asserted in writing by an Interest Owner before such date. 
 (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 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 

  

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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 Indemnified 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 of the Indemnifying Party’s books and records 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. 
 (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
Limitations on Liability of Interest Owners. Notwithstanding anything contained herein to the contrary, the liability of each Interest Owner with respect to its representations, warranties, covenants and indemnifications contained in this
Contract shall be limited to a percentage of the total liability of the Interest Owners with respect thereto equal to such Interest Owner’s percentage interest in the Company. 
 8.10 Contingent Reserve for Claims. Contingent reserves shall be established for the purposes and in the amounts specified below: 
 (a) Notwithstanding anything contained in this Contract to the contrary, at the Closing, Buyer shall be entitled to hold in reserve from
the Purchase Price the sum of One Hundred Thousand Dollars ($100,000) (the “Post-Closing Reserve”) to pay for any Post-Closing 

  

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Claims (as hereinafter defined) under this Contract, as such sum may be reduced as hereinafter provided. For purposes of this Section 8.10,
“Post-Closing Claims” shall mean any post-closing claim by Buyer under this Contract, including (i) all claims under Section 8.8(a) hereof, (ii) all adjustments under Article XII thereof and (iii) all other
obligations of the Interest Owners thereunder that survive Closing, but only if such claim is asserted by Buyer within six (6) months after the Closing under this Purchase Contract (the “Post-Closing Claim Period”). Except to
the extent any Post-Closing Claims remain outstanding, any funds remaining in the Post-Closing Reserve shall be paid to the Interest Owners upon the expiration of the Post-Closing Claim Period. 
 (b) Nothing contained in this Section 8.10 shall limit the personal liability of the Interest Owners for post-closing claims under
this Purchase Contract to the extent the same may exceed in the aggregate the Post-Closing Reserve or to the extent the same may be asserted by Buyer after any applicable Post-Closing Claim Period, subject to any other limitations and conditions set
forth in this Contract. 
 8.11 Tax Matters. Without the prior written consent of Buyer, neither the Company nor any of the Interest
Owners shall make or change any election, change an annual accounting period, adopt or change any accounting method, file any amended Tax Return, enter into any closing agreement, settle any Tax claim or assessment relating to the Company, surrender
any right to claim a refund of Taxes, consent to any extension or waiver of the limitation period applicable to any Tax claim or assessment relating to the Company, or take any other similar action relating to the filing of any Tax Return or the
payment of any Tax, if such election, adoption, change, amendment, agreement, settlement, surrender, consent or other action would have the effect of increasing the Tax liability of the Company for any period ending after the Closing Date or
decreasing any Tax attribute of the Company existing on the Closing Date. 
 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. 
  

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 (a) All representations and warranties of the Company and each Interest Owner 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 listed in Section 10.2. 
 (c) The Company and each
Interest Owner 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 the Company and
each Interest Owner, as and when required hereunder. 
 (d) The Lender, if any, shall have consented to the Contemplated
Transactions upon terms and conditions satisfactory to Buyer, and all other Third Party Consents in form and substance satisfactory to Buyer shall have been obtained and furnished to Buyer. 
 (e) The Existing Management Agreement and the Existing Franchise Agreement shall have been terminated. The New Manager and the Company
shall have entered into the New Management Agreement. The Franchisor and the Company shall have entered into the New Franchise Agreement on terms and conditions acceptable to Buyer in its sole discretion and in any event upon financial terms that
are no less favorable than the Existing Franchise Agreement. 
 (f) The Company shall have no employees and shall neither
maintain nor have an obligation to contribute to any Employee Plan. 
 9.2 Interest Owner’s Conditions for Closing. Unless
otherwise waived in writing, and without prejudice to the Interest Owner’s right to cancel this Contract during the Review Period, the duties and obligations of the Interest Owners 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 the Interest Owners, the Interest Owners shall have the right at their 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) The Interest Owners shall have
received all of the money, instruments and conveyances listed in Section 10.3. 
  

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 (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. 
 (d) Buyer shall have received the consents of the Franchisor to the termination of the Existing Management Agreement and the Existing
Franchise Agreement. 
 ARTICLE X 
 CLOSING AND CONVEYANCE 
 10.1 Closing. Unless otherwise agreed by Buyer and the Interest Owners, the Closing on the
Property shall occur on a date selected by Buyer that is not later than fifteen (15) Business Days after expiration of the Review Period, provided that all conditions to Closing hereunder have been satisfied. Buyer will provide Interest Owners
at least five (5) days prior written notice of the Closing Date selected by Buyer. 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 the Interest
Owners, is referred to in this Contract as the “Closing Date” for the Property. The Closing shall be held at 10:00 a.m. at the offices of the Title Company, or as otherwise determined by Buyer and the Interest Owners. 
 10.2 Interest Owners’ Deliveries. At Closing, the Interest Owners or the Company, as applicable, shall deliver to Buyer the following, and,
as appropriate, all instruments shall be properly executed and conveyance instruments shall 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 the Interest Owners prior to such Closing). 
 (a) An assignment or assignments duly executed and acknowledged
transferring to Buyer all of the Interests, free and clear of Interest Liens, in form and substance acceptable to Buyer; 
 (b) Resignations of all officers, managers, directors and other agents of the Company; 
 (c) The original
Organizational Documents of the Company, including the articles of organization or articles of incorporation certified by the appropriate official of the state in which the Company is organized or incorporated, and a certificate issued by such
official that the Company is in valid existence and good standing as of the Closing Date; 
 (d) Certified copies of
resolutions and/or other evidence reasonably satisfactory to Buyer that the person or persons executing the closing documents on behalf of the Company and the Interest Owners have full right, power and authority to do so, along with a certificate of
good standing of each Interest Owner that is an entity from the state in which Interest Owner is organized or incorporated; 
  

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 (e) To the extent not previously delivered to and in the possession of Buyer, all
Contracts, Plans and Specs, all Warranties and all keys for the Hotel (which keys shall be properly tagged for identification); 
 (f) A closing statement to evidence the parties’ agreement regarding the allocations, pro-rations and hold-backs relating to the Property, the payment of closing costs as allocated hereunder, and any resulting adjustment of the
Purchase Price; 
 (g) Evidence satisfactory to Buyer of the termination of the Existing Management Agreement and the Existing
Franchise Agreement and execution and delivery by the New Manager of the New Management Agreement; 
 (h) 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 for issuance of an Owner’s Policy of Title
Insurance to the Company insuring good and marketable fee simple absolute title (or leasehold title if so identified in Item 4 of Schedule 1) to the Real Property constituting part of the Property, subject only to the Permitted
Exceptions in the amount of the Purchase Price, together with an nonimputation endorsement; and 
 (i) Such other instruments
as are contemplated by this Contract to be executed or delivered by the Company or any Interest Owner, or reasonably required by Buyer or the Title Company, or customarily executed in the jurisdiction in which the Hotel is located, to effectuate the
assignment of all of the Interests to Buyer and the other Contemplated Transactions, with the effect that, after the Closing, Buyer will have succeeded to all of the rights, titles, and interests in the Company and the Company will own good and
marketable fee simple title to the Land and the Hotel in accordance with this Contract. 
 10.3 Buyer’s Deliveries. On or prior
to the Closing Date, Buyer shall pay the Interest Owners the Purchase Price, as adjusted pursuant to this Contract, and shall deliver or cause to be delivered to the Interest Owners the following agreements, documents and other items, which shall be
in form and substance reasonably satisfactory to the Interest Owners: 
 (a) a closing statement to evidence the parties’
agreement regarding the allocations, pro-rations and hold-backs relating to the Property, the payment of closing costs as allocated hereunder, and any resulting adjustment of the Purchase Price; and 
 (b) such additional documents as might be reasonably requested by the Interest Owners to evidence Buyer’s authority to consummate the
purchase of the Interests from the Interest Owners. 
 10.4 Tax Matters. The following provisions shall govern the allocation of
responsibility as between Buyer and Sellers for certain tax matters following the Closing Date: 
  

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 (a) Tax Indemnification. Each of the Interest Owners shall indemnify Buyer, and
hold it harmless from and against (without duplication), any loss, claim, liability, expense, or other damage attributable to (i) all Taxes (or the non-payment thereof) of the Company for all taxable periods ending on or before the Closing Date
and the portion through the end of the Closing Date for any taxable period that includes (but does not end on) the Closing Date (“Pre-Closing Tax Period”), and (ii) any and all Taxes of any person (other than the Company)
imposed on the Company as a transferee or successor, by contract or pursuant to any law, rule, or regulation, which Taxes relate to an event or transaction occurring before the Closing. 
 (b) Straddle Period. In the case of any taxable period that includes (but does not end on) the Closing Date (a “Straddle
Period”), the amount of any Taxes based on or measured by income or receipts of the Company for the Pre-Closing Tax Period shall be determined based on an interim closing of the books as of the close of business on the Closing Date (and for
such purpose, the taxable period of any partnership or other pass-through entity in which the Company holds a beneficial interest shall be deemed to terminate at such time) and the amount of other Taxes of the Company for a Straddle Period that
relates to the Pre-Closing Tax Period shall be deemed to be the amount of such Tax for the entire taxable period multiplied by a fraction the numerator of which is the number of days in the taxable period ending on the Closing Date and the
denominator of which is the number of days in such Straddle Period. 
 (c) Responsibility for Filing Tax Returns. Buyer
shall prepare or cause to be prepared and file or cause to be filed all Tax Returns for the Company that are filed after the Closing Date. Buyer shall permit the Interest Owners to review and comment on each such Tax Return described in the
preceding sentence prior to filing. 
 (d) Cooperation on Tax Matters. 
 (i) Buyer, the Company, and the Interest Owners shall cooperate fully, as and to the extent reasonably requested by the other Party, in
connection with the filing of Tax Returns pursuant to this section and any audit, litigation or other proceeding with respect to Taxes. Such cooperation shall include the retention and (upon the other Party’s request) the provision of records
and information that are reasonably relevant to any such audit, litigation or other proceeding and making employees available on a mutually convenient basis to provide additional information and explanation of any material provided hereunder. The
Interest Owners agree (A) to retain all books and records with respect to Tax matters pertinent to the Company relating to any taxable period beginning before the Closing Date until the expiration of the statute of limitations (and, to the
extent notified by Buyer or the Company or Interest Owners, any extensions thereof) of the respective taxable periods, and to abide by all record retention agreements entered into with any taxing authority, and (B) to give Buyer reasonable
written notice prior to transferring, destroying or discarding any such books and records and, if Buyer so requests, the Interest Owners shall allow Buyer to take possession of such books and records. 
  

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 (ii) Buyer, the Company, and the Interest Owners further agree, upon request, to use
their best efforts to obtain any certificate or other document from any governmental authority or any other Person as may be necessary to mitigate, reduce or eliminate any Tax that could be imposed (including, but not limited to, with respect to the
transactions contemplated hereby). 
 (iii) Buyer, the Company, and the Interest Owners further agree, upon request, to
provide the other Party with all information that either Party may be required to report pursuant to Code §6043 and all Treasury Regulations promulgated thereunder. 
 (e) Survival. The provisions of this Section 10.4 shall survive the Closing for a period ending on the later of
(i) three (3) years following the date on which the Company files its Tax Return for the tax period ended December 31, 2006 or (ii) the expiration of any applicable statute of limitations that may be extended. 
 ARTICLE XI 
 COSTS 
 All Closing costs shall be paid as set forth below: 
 11.1 Interest Owner’s Costs. Interest Owners shall be responsible for all transfer, recordation, sales, use, income, bulk transfer taxes or like taxes in connection with the sale of the Interests hereunder and for all sales and
use, hotel occupancy and other taxes of the Company or the Hotel for the period prior to Closing. Interest Owners shall be responsible for all costs related to the termination of the Existing Management Agreement and the Existing Franchise
Agreement. Interest Owners shall also be responsible for the costs and expenses of their and the Company’s attorneys, accountants, appraisers and other professionals, consultants and representatives. Interest Owners shall also be responsible
for payment of all prepayment penalties, premiums and other charges or amounts payable in connection with the pay-off of any Property Liens encumbering the Property, other than Property Lien securing the Assumed Loan, if any. Interest Owners shall
be responsible for all costs to complete all PIP improvements required by the Franchisor to the extent provided in Schedule 2. 
 11.2
Buyer’s Costs. In connection with the purchase of the Interests 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. Buyer shall be responsible for costs related to the execution of the New Franchise Agreement. Buyer shall also be responsible for assumption and legal fees in connection with
the approval by the Lender, if any, of Buyer’s purchase of the Interests, and for any renovation costs to the extent provided in Schedule 2. The Company and the Interest Owners shall use commercially 

  

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reasonable efforts, and shall fully cooperate with Buyer, to obtain the approval of the Lender, if any, of Buyer’s purchase of the Interests.

 ARTICLE XII 
 ADJUSTMENTS 
 12.1 Adjustments. Unless otherwise provided herein, at Closing, adjustments between the parties shall
be made as of 12:01 a.m. on the Closing Date (the “Cutoff Time”), with the income and expenses accrued prior to the Closing Date being allocated to the Interest Owners and the income and expenses accruing on and after the Closing
Date being allocated to Buyer, as if the Contemplated Transactions were a transfer of the Hotel rather than a transfer of the Interests, all as set forth below. Subject to the foregoing and except as otherwise expressly provided herein, all
apportionments and adjustments shall be made on an accrual basis in accordance with the Uniform System of Accounts for the Lodging Industry (9th Revised Edition) published by the American Hotel & Lodging Association. 
 (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. 
 (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 the Interest Owners. Charges accruing after the Cutoff Time shall be allocated to Buyer. 
 (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 the Interest Owners as of the Cutoff Time. 
 (d) Accounts. The Interest Owners shall be entitled to retain the Hotel’s working capital account and to withdraw all funds contained therein as of the Cutoff Time. The Interest Owners shall receive a
credit in the amount of the aggregate balance as of the Cutoff Time in the FF&E reserve account and escrow accounts (including all PIP accounts and all amounts held in tax and insurance escrow accounts), plus the amount of all utility deposits,
petty cash, cash in cash registers and cash in vending machines, all of which accounts and cash shall remain with the Company after the Closing. All other accounts, reserves and escrows, if any, held by the Company or by the Existing Manager, any
Lender or any other Person on the Company’s behalf shall remain the property of the Company and be credited to Buyer, without additional charge to Buyer and without Buyer being required to fund the same. 
  

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 (e) Room Revenues. All revenues from guest room rentals and other suite revenues
for the period before the Closing Date shall be allocated to the Interest Owners, and all such revenues for the period after the Closing Date shall be allocated to the Buyer. All such revenues for the night in which the Cutoff Time occurs shall be
credited to the Interest Owners, but the Interest Owners shall provide the Buyer credit at Closing equal to the reasonable expenses to be incurred to clean such guests’ rooms. 
 (f) Employee Costs. Except as provided in (e) above, all wages and other costs for housekeeping and Hotel personnel shall be
prorated between Buyer and the Interest Owners as of the Cutoff Time. 
 (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. Accounts receivable and credit card claims as of the Cutoff Time shall be transferred to the Interest
Owners and shall not be a credit to the Interest Owners at Closing. The Interest Owners and Buyer agree, and Buyer shall instruct the New Manager, that the monies received from debtors owing such accounts receivable balances after Closing shall be
payable to the Interest Owners. 
 (i) Accounts Payable. Any indebtedness, accounts payable, liabilities or obligations
of any kind or nature related to the Company or the Property for the periods prior to the Cutoff Time shall be allocated to the Interest Owners, 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 the Interest Owners 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 be credited to the Interest Owners, 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 the Interest Owners and Buyer at Closing. 
 (k) Interest on Assumed Loan. In the case of an Assumed Loan, if any, the accrued and unpaid interest thereon shall be prorated as of the Cutoff Time. 
 12.2 Reconciliation and Final Payment. The Interest Owners and Buyer shall reasonably cooperate after Closing to make a final determination of the
allocations and prorations required under this Contract within sixty (60) days after the Closing Date. 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 

  

 42 

 
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. Unless Buyer expressly agrees otherwise, none of the employees of the Company shall become employees of Buyer as of
the Closing Date; instead, such employees shall be terminated by the Company and shall be rehired as employees of the New Manager with all seniority, wages and benefits of each employee transferring with each employee to the New Manager. Neither the
Company nor the Interest Owners shall 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., Section 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, health care continuation 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 not in any way become the legal obligation of Buyer or the Company but shall be charged to the Interest Owners for the purposes of the adjustments to be made as of the Cutoff Time, and neither the Company nor Buyer
shall have any liability therefor, nor shall either the Company or Buyer be liable for any contributions, fees, premiums, expenses, penalties or other payments required as a result of such employees’ employment by the Company and/or coverage
under any Employee Plan of the Company before the Closing. All liability for wages, salaries and benefits of the employees accruing in respect of and attributable to the period from and after the Cutoff Time shall be charged to the New Manager and
reimbursed by the Company to the New Manager to the extent required under the New Management Agreement. 
 ARTICLE XIII 
 CASUALTY AND CONDEMNATION 
 13.1
Risk of Loss; Notice. Prior to Closing and the sale of the Interests to Buyer in accordance with this Contract, all risk of loss to the Property (whether by casualty, condemnation or otherwise) shall be borne by the Interest Owners. 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) the Company receives notice that a governmental authority has initiated or threatened to initiate a
condemnation proceeding affecting the Hotel, the Interest Owners 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 sale of the Interests 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 the Company of its election within twenty (20) days after the date the Interest Owners

  

 43 

 
have delivered to 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 the 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, all insurance proceeds or condemnation awards
which the Company has received as a result of the same, plus an amount equal to the insurance deductible shall be paid or credited to Buyer, and all insurance proceeds and condemnation awards payable as a result of the same shall be paid or credited
to Buyer, in which event the Closing shall occur without replacing or repairing such damage. In the case of damage or casualty, at Buyer’s election, the Property shall be repaired and restored to its condition immediately prior to such damage
or casualty, and all excess insurance proceeds shall be credited to Buyer. 
 ARTICLE XIV 
 DEFAULT REMEDIES 
 14.1 Buyer
Default. If Buyer defaults under this Contract after the Review Period, and such default continues for ten (10) days following written notice from the Company (provided no notice shall extend the time for Closing), then at the election of a
majority of the Interest Owners 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 Interest Owners as the
sole and exclusive remedy of the Interest Owners and the Company hereunder, as liquidated damages for Buyer’s default or failure to close, and both Buyer and the Interest Owners shall thereupon be released from all obligations hereunder.

 14.2 Interest Owner/Company Default. If any Interest Owner or (before the Closing) the Company defaults under this Contract, and
such default continues for ten (10) 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 the Company delivered 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, and thereafter both the Buyer and the Interest Owners 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 the Company delivered at any time prior to the completion of such cure, in which
event the Buyer shall have the right to an action against the Interest Owners and/or the Company for damages, specific performance and all other rights and remedies available at law or in equity. 
  

 44 

 14.3 Attorney’s Fees. Anything to the contrary herein notwithstanding, if it shall be
necessary for either the Buyer or the Interest Owners 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 telecopy, when the telecopy is transmitted to the party’s telecopy 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 Seven Hospitality Ownership, Inc.
 814 East Main
Street
 Richmond, Virginia 23219
 Attention: Justin G. Knight,
President
 Fax No.: (804) 727-6350

		
	 with a copy to:
	  	 Apple Seven Hospitality Ownership, Inc.
 814 East Main
Street
 Richmond, Virginia 23219
 Attention: Legal
Dept.
 Fax No.: (804) 727-6349

		
	 If to the Company,
 the Interest Owners:
	  	 Managing Member or President identified in Item 2(c) of Schedule 1
 c/o Larry Blumberg & Associates, Inc.
 2733 Ross Clark Circle
 P.O. Box 5566, Dothan, Alabama 36302
 Attn: Barry Kraselsky
 Fax No.: (334) 671-1356

		
	 with a copy to:
	  	 Johnston, Hinesley, Flowers, Clenney & Turner, P.C.
 Post Office Box 2246 (36302)
 291 North Oates Street
 Dothan, Alabama 36303
 Attn: William W. Hinesley
 Fax
No.: (334) 793-6603

  

 45 

 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 the parties hereto with respect to the subject matter hereof. No modification of this Contract shall be binding unless signed by the parties hereto. 
 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 Commonwealth of Virginia (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, none of Buyer, any Interest Owner or the Company shall 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 those Persons necessary for a party to meet its obligations hereunder, including their respective legal counsel, consultants and agents, the
Existing Manager, the New Manager, the Franchisor, the Lender (if any) and the Title Company and except as necessitated by Buyer’s Due Diligence Examination and/or shadow management, unless both Buyer and the Company agree in writing 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. 
  

 46 

 16.7 Closing Documents. To the extent any Closing documents are not attached hereto at the time of
execution of this Contract, Buyer and the Company 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 the Interest Owners 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 Intentionally Omitted. 
 16.12
Further Acts. In addition to the acts, instruments and agreements recited herein and contemplated to be performed, executed and delivered by Buyer and the Interest Owners, Buyer and the Interest Owners 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. 
 16.13 Joint and Several Obligations. If any Interest Owner 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 such Interest Owner under this Contract. 
 ARTICLE XVII 
 SUPPLEMENTAL PROVISIONS 
 All of the terms, conditions, representations, warranties, covenants and other provisions, if any, set forth in the supplemental provisions attached
hereto as Schedule 2 (the “Supplemental Provisions”) are hereby incorporated into this Contract and shall be considered a part hereof. In the event of any conflict or inconsistency between the Supplemental Provisions and the
other provisions of this Contract, the Supplemental Provisions shall control. 
 [Signatures Begin on Following Page] 
  

 47 

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

	
	INTEREST OWNERS:
	
	/s/ Larry Blumberg
	Larry Blumberg
	
	/s/ John H. Watson
	 Watson & Downs Investments, L.L.C.
 By: John H.
Watson, Its Manager

	
	/s/ Robert Hayne Hollis, III
	Robert Hayne Hollis, III
	
	/s/ Richard Blumberg
	Richard Blumberg
	
	/s/ Barry Kraselsky
	Barry Kraselsky
	
	/s/ Helen B. Lifland
	Helen B. Lifland
	
	COMPANY:
	
	 SUNBELT – COLUMBUS, L.L.C., an
 Alabama Limited
Liability Company

			
		
	By:	 	/s/ Larry Blumberg

			
	 Name:
 Title:
	 	 Larry Blumberg
 Its Manager

  

 48 

	
	BUYER:
	
	 APPLE SEVEN HOSPITALITY OWNERSHIP,
 INC., a Virginia
corporation

			
		
	By:	 	/s/ Justin G. Knight

			
	Name: 	 	Justin G. Knight

			
	Title: 	 	Vice President

  

 49 

 SCHEDULE 1 
 HOTEL SPECIFIC DATA 
 1. Date of Purchase Contract: January 16, 2007 
 2. (a) Interest Owners: 
  

						
	 Interest Owner
	  	Percentage Interest	 	 	Tax
Identification No.
	 Larry Blumberg
	  	20.00	%	 	
	 Richard Blumberg
	  	12.50	%	 	
	 Helen B. Lifland
	  	  5.00	%	 	
	 Watson & Downs Investments, L.L.C.
	  	25.00	%	 	
	 Hayne Hollis
	  	25.00	%	 	
	 Barry Kraselsky
	  	12.50	%	 	

  

	 	(b)	Company: Sunbelt-Columbus, L.L.C., an Alabama Limited Liability Company 

 3. Description of Hotel: 
  

	 	(a)	Name/Identification of Hotel: Columbus Fairfield Inn & Suites by Marriott 

  

	 	(b)	Number of Rooms: 79 

  

	 	(c)	Other Improvements/Amenities: Indoor heated swimming pool, whirlpool, exercise room, wireless high speed internet access 

 4. Ground Lease: Ground Sublease between Columbus Property, L.L.C. and Sunbelt – Columbus, L.L.C. dated April 10, 2002, subordinate to the Ground Lease
Agreement between the Columbus Airport Commission and Columbus Property, L.L.C. dated October 1, 1998. 
 5. Hotel Brand/Franchise: Fairfield
Inn & Suites by Marriott 
 6. Manager: LBAM – Investor Group, L.L.C. 
 7. Existing Management Agreement: Management Agreement between LBAM-Investor Group, L.L.C. and the Company dated August 22, 2002. 
  

					
		  	1	  	 Purchase Contract
 Schedule 1 – Hotel Specific Data

 8. Franchisor: Marriott International, Inc. 
 9. Existing Franchise Agreement: Franchise Agreement between Sunbelt-Columbus, L.L.C. and Marriott International, Inc. dated August 22, 2006 
 10. Assumed Loan: N/A 
 11. Lender: N/A 
 12. Purchase Price: Seven Million Three Hundred Thirty Two Thousand Five Hundred Ninety Seven and no/100 Dollars ($7,332,597.00) 
 13. Escrow Amount: $_________ 
  

			
	 Accounts Payable
	  	$            
	 Marriott Life Safety
	  	
	 Product
	  	
	 50%
	  	
	 Total
	  	$            

  

					
		  	2	  	 Purchase Contract
 Schedule 1 – Hotel Specific Data

 SCHEDULE 2 
 SUPPLEMENTAL PROVISIONS 
 1. Liquor Licenses. The Interest Owners represent and warrant
that (i) the brand standard requirements of the Franchisor do not require the sale or complimentary service of alcoholic beverages at the Hotel, (ii) alcoholic beverages are not sold or otherwise served at the Hotel, and, (ii) the
Hotel as currently operated and in order to comply with the brand standard requirements of the Franchisor does not require any license, permit or other authorization of governmental authorities related to the sale or service of alcoholic beverages
and (iii) the Hotel, the Company and the Manager are in compliance in all material respects with all applicable laws and regulations relating to the sale or service of alcoholic beverages. 
 2. Allocation of Purchase Price. The Company, the Interest Owners and Buyer agree that the Purchase Price shall be allocated in the manner set
forth in Exhibit J attached hereto and that such parties shall file all Tax Returns (including amended returns and claims for refund) and information reports in a manner consistent with such allocation. 
  

					
		  	1	  	 Purchase Contract
 Schedule 2 – Supplimental Provisions

 SCHEDULE 2.5 
 PIP IMPROVEMENTS 
 N/A 
  

					
		  	1	  	 Purchase Contract
 Exhibit A – Legal Description

 SCHEDULE 7.1(j) 
 LITIGATION 
 None 
  

					
		  	2	  	 Purchase Contract
 Exhibit A – Legal Description

 SCHEDULE 7.1(l) 
 CONDEMNATION PROCEEDINGS 
 None 
  

					
		  	3	  	 Purchase Contract
 Exhibit A – Legal Description

 SCHEDULE 7.1(m) 
 LEASES 
 Ground Sublease between Columbus Property, L.L.C. and 
 Sunbelt – Columbus, L.L.C. dated April 10, 2002, 
 Subordinate to the Ground Lease Agreement between the 
 Columbus Airport Commission and Columbus Property,
L.L.C. 
 dated October 1, 1998 
  

					
		  	4	  	 Purchase Contract
 Exhibit A – Legal Description

 SCHEDULE 7.1(n) 
 TRADE MARKS and TRADE NAMES 
 Fairfield Inn & Suites by Marriott 
 Columbus, Georgia 
  

					
		  	5	  	 Purchase Contract
 Exhibit A – Legal Description

 SCHEDULE 7.1 (p)(iv) 
 TAX RETURNS 
 2003 through 2005 
 Federal Income Tax Returns 
 See Attached Schedule of Tax Returns

 e-mailed to Sam Reynolds 
 October 2, 2006 
 None of these returns were audited or under audit 
  

					
		  	6	  	 Purchase Contract
 Exhibit A – Legal Description

 SCHEDULE OF TAX RETURNS 
  

															
	  	  	 Entity
	  	2005	  	2004	  	2003
	 Property
	  	  	Federal	  	State	  	Federal	  	State	  	Federal	  	State
	 Fairfield Inn & Suites Columbus
	  	Sunbelt – Columbus, LLC	  	X	  	AL/GA	  	X	  	AL/GA	  	X	  	AL/GA
	 Fairfield Inn Dothan
	  	Blumberg - Dothan Motel, LLC	  	X	  	AL	  	X	  	AL	  	X	  	AL
	 Fairfield Inn Tallahassee
	  	Sunbelt - Tallahassee, LLC	  	X	  	FL	  	X	  	FL	  	X	  	FL
	 Courtyard Lakeland
	  	Sunbelt – Lakeland, LLC	  	X	  	FL	  	X	  	FL	  	X	  	FL

  

					
		  	7	  	 Purchase Contract
 Exhibit A – Legal Description

 SCHEDULE 7.1(q) 
 INSURANCE 
 See Attached Certificate of Insurance 
  

					
		  	8	  	 Purchase Contract
 Exhibit A – Legal Description

 IMPORTANT 
 If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must be endorsed. A statement on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). 
 If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement on this certificate does not confer
rights to the certificate holder in lieu of such endorsement(s). 
 DISCLAIMER 
 The Certificate of Insurance on the reverse side of this form does not constitute a contract between the issuing insurer(s), authorized representative or producer, and
the certificate holder, nor does it affirmatively or negatively amend, extend or alter the coverage afforded by the policies listed thereon. 
 ACORD 25-S
(2001/08) 2 of 3             #M277228 
  

					
		  	9	  	 Purchase Contract
 Exhibit A – Legal Description

 DESCRIPTIONS (Continued from Page 1) 
 Marriott -12260 Morris Bridge Road, Temple Terrace, FL 33637 
  

	2.	Sunbelt - Tallahassee, LLC dba Tallahassee Fairfield Inn by Marriott 

 3211 North Monroe Street, Tallahassee, FL 32303. 
  

	3.	Sunbelt -Columbus, LLC dba Columbus Fairfield Inn & Suites by Marriott 

 4510E Armour Road, Columbus, GA 31909 
  

	4.	Blumberg - Dothan Motel, LLC dba Dothan Fairfield Inn by Marriott 

 3038 Ross Clark Circle, Dothan, AL 36301 
 Business Income is Actual Loss Sustained. 
 AMS 25.3 (2001/08) 3 of 3             #M277228 
  

					
		  	10	  	 Purchase Contract
 Exhibit A – Legal Description

 EXHIBIT A 
 LEGAL DESCRIPTION 
 See Attached 
  

					
		  	12	  	 Purchase Contract
 Exhibit A – Legal Description

 SCHEDULE C 
 PAGE 1 
 

 
 5 April, 2002. 
 LEGAL
DESCRIPTION: Fairfield Inn Site, Columbus, Muscogee County, Georgia 
 All that certain tract or parcel of land located in Land Lots 46 and 47 of the
8th Land District, Columbus, Muscogee County, Georgia containing 2.32 acres and being more particularly described as
follows: 
 Starting at the intersection of the North right of way of State Route 85-Alt. 27 and the East right of way of Armour Road in Columbus, Muscogee
County, Georgia go along the East right of way of Armour Road the following courses: North 02 degrees 17 minutes 41 seconds West 323.40 feet; South 88 degrees 51 minutes 47 seconds East 4.34 feet; North 05 degrees 20 minutes 22 seconds East 75.73
feet, North 02 degrees 29 minutes 11 seconds West 331.33 feet; thence along a curve, as it curves, concave Northwesterly, having an arc length of 250.74 feet, a radius of 576.64 feet, and a chord of North 66 degrees 46 minutes 38 seconds East 248.77
feet; thence North 54 degrees 19 minutes 13 seconds East 272.10 feet; thence along a curve, as it curves, concave Northwesterly, having an arc length of 23.60 feet, a radius of 25.00 feet and a chord of North 27 degrees 02 minutes 01 seconds East
22.73 feet to an iron pin, also being the POINT of BEGINNING; thence North 00 degrees 22 minutes 13 seconds East 287.12 feet to an iron pin; thence South 89 degrees 27 minutes 51 seconds 193.91 feet to a cul-de-sac; thence along a curve forming the
cul-de-sac, as it curves, concave Northeasterly, having an arc length of 62.39 feet, a radius of 43.00 feet and a chord of South 42 degrees 34 minutes 28 seconds East 57.06 feet; thence continuing along the West side of the cul-de-sac the following
courses; along a curve, as it curves, concave Southwesterly, having an arc length of 18.63 feet, a radius of 12.00 feet and a chord of South 39 degrees 39 minutes 32 seconds East 16.82 feet: South 04 degrees 49 degrees 13 seconds West 105.03 feet;
South 06 degrees 20 minutes 24 seconds West 187.57 feet, thence along a curve, as it curves, concave Northwesterly, having an arc length of 196.90 feet, a radius of 134.00 feet and a chord of South 48 degrees 26 minutes 08 seconds West 179.66 feet;
North 89 degrees 28 minutes 08 seconds West 49.86 feet; a curve, as it curves, concave Southeasterly, having an arc length of 33.06 feet, a radius of 216.00 feet and a chord of South 86 degrees 08 minutes 47 seconds West 33.03 feet; thence North 00
degrees 31 minutes 52 seconds East 181.70 feet to the POINT of BEGINNING. 
 121 W. Broad St., P.O. Box 82 
 Eufaula, Alabama 36072-0082 
 334-687-4257

 Fax 334-687-8829 
  

					
		  	13	  	 Purchase Contract
 Exhibit A – Legal Description

 EXHIBIT B 
 LIST OF FF&E 
  

							
	 AREA
	  	 ITEM
	  	 DESCRIPTION
	  	QUANTITY
				
	 LOBBY/BREAKFAST
	  	Sofa	  	Upholstered	  	1
		  	Chairs	  	Upholstered	  	2
		  		  	Upholstered	  	2
		  		  	Breakfast	  	28
		  	Tables	  	Breakfast Tables	  	10
		  		  	Cocktail Table	  	1
		  		  	End Tables	  	3
		  	Television	  	25” Phillips	  	1
		  	Booster Chairs	  		  	2
		  	High Chairs	  		  	2
		  	Drapes	  		  	3
				
	 KITCHEN
	  	Refrigerator	  	True Model T23	  	2
		  	Freezer	  	True Model T23	  	2
		  	Microwave	  	Amana	  	1
		  	Ice Machine	  	Manitowoc Series 320	  	1
		  	Coffee Makers	  	Douwe Egbert	  	1
		  	Toasters	  	Hobart	  	1
				
	 GM OFFICE
	  	Desk	  	1 desk	  	1
		  	Desk Chair	  	1 desk chair	  	1
		  	Other Chairs	  	2 arm chairs	  	2
		  	Bookcases	  	1 bookcase	  	1
		  	Computer	  	Dell Laptop	  	1
				
	 BACK OFFICE
	  	Chairs	  		  	1
		  	Computer	  	Fosse terminals	  	2

  

					
		  	1	  	 Purchase Contract
 Exhibit B – List of FF&E

							
		  	Copier	  		  	1
		  	Timeclock Computer	  		  	1
		  	Drop Safe	  		  	1
				
	 FRONT DESK
	  	Computers	  	2 computers – Fosse Terminals	  	2
		  	Telephone Switchboard	  	1 Mitel super console 1000	  	1
		  	Adding Machine	  	Three	  	3
		  	Safe Deposit Boxes	  	17 safe deposit boxes	  	17
		  	Fax Machine	  	One	  	1
		  	Security Equipment (all)	  	Monitors	  	1
		  		  	Cameras	  	5
		  		  	DVR	  	1
		  	TDD Equipment	  		  	1
		  	Key Card Equipment	  	Tesa HT20l	  	1
				
	 BUSINESS CENTER
	  	Computer	  	Dell	  	1
		  	Printer	  	HP	  	1
		  	Desk	  		  	1
		  	Desk Chair	  		  	1
				
	 GUEST LAUNDRY
	  	Washer	  	Whirlpool	  	1
		  	Dryer	  	Whirlpool	  	1
				
	 LAUNDRY/LINEN STORAGE
	  	Washer	  	Unimac	  	1
		  	Dryers	  	Speed Queen	  	2
		  	Metro Carts	  		  	4
		  	Dirty Linen Carts	  		  	2
		  	Clean Linen Carts	  		  	2
		  	Linen Storage Shelves	  	Built-in	  	3
		  	Room Attendant Carts	  	Rubbermaid	  	6
		  	Vacuum Cleaners	  		  	8
		  	Rollaways	  		  	2
		  	Ozone Machine	  		  	2
		  	Wheelchair	  		  	1

  

					
		  	2	  	 Purchase Contract
 Exhibit B – List of FF&E

							
	 	  	Cribs	  	 	  	4
		  	 Extra Microwaves
	  		  	4
		  	 Extra Mini Refrigerators
	  		  	4
		  	 Extra Irons
	  		  	6
		  	 Extra Clock Radios
	  		  	3
		  	 Extra Hairdryers
	  		  	3
		  	 Extra Coffee Makers
	  		  	6
		  	 Extra Telephones
	  		  	6
				
	MAINTENANCE SHOP	  	 Power Drill
	  		  	1
		  	 Furniture Dolly
	  		  	1
		  	 Shop Vac
	  		  	1
		  	 Steam Machine
	  		  	1
		  	 PM Cart
	  		  	1
		  	 Pressure Washer
	  		  	1
		  	 Back Up TV’s
	  	 PHILLIPS
	  	2
		  	 Back Up HVAC’s
	  	 GE
	  	2
				
	SWIMMING POOL AREA	  	 Lounge Chairs
	  		  	8
		  	 Straight Chairs
	  		  	14
		  	 Tables
	  		  	2
		  	 Umbrellas
	  		  	2
		  	 Ash/Trash Receptacles
	  		  	2
				
	 EXERCISE ROOM
	  	 Television
	  		  	1
		  	 Television Swivel
	  		  	1
		  	 Treadmill
	  		  	2
		  	 Bicycle
	  		  	1
		  	 Stair Climber
	  		  	1
		  	 Towel Rack & Hamper
	  		  	1
				
	 CORRIDORS
	  	 Tables
	  		  	1
		  	 Lamps
	  		  	1

  

					
		  	3	  	 Purchase Contract
 Exhibit B – List of FF&E

							
		  	Mirrors/Artwork	  		  	1
		  	Ice Machines	  	Manitowoc	  	3
		  	Luggage Carts	  		  	2
				
	 GUESTROOMS
	  	Furniture	  	King Bedskirt / Scarf	  	60
		  		  	Double Bedskirt / Scarf	  	100
		  		  	Nightstand Medium Cherry	  	48
		  		  	Chair Task	  	79
		  		  	Headboard Double Medium Cherry	  	80
		  		  	Headboard King Medium Cherry	  	39
		  		  	Boxspring Double	  	81
		  		  	Mattress Double	  	81
		  		  	Boxspring King	  	78
		  		  	Mattress King	  	39
		  		  	Bedbase Double Brown	  	80
		  		  	Bedbase King Brown	  	39
		  		  	Bedframe Double/Queen	  	4
		  		  	Bedframe Queen/King	  	3
		  		  	Luggage Rack	  	79
		  		  	Nightstand 16”wide Medium Cherry	  	68
		  		  	Desk Medium Cherry	  	74
		  		  	Desk ADA	  	5
		  		  	Lounge Chair - Suite	  	12
		  		  	Table Coffee	  	12
		  		  	Chair Lounge	  	67
		  		  	Ottoman	  	67
		  		  	Nightstand 20” wide Medium Cherry	  	6
		  		  	Dresser Medium Cherry	  	76
		  		  	Sofa Bed	  	12
		  		  	Amoire Medium Cherry	  	12
		  		  	Mirror Vanity Framed	  	79
		  		  	Artwork	  	189
		  		  	TV - 25”	  	82

  

					
		  	4	  	 Purchase Contract
 Exhibit B – List of FF&E

							
		  		  	Remote Control	  	86
		  		  	Swivel Mount	  	81
		  		  	Shower Curtain Almond 72x72	  	81
		  		  	Shower Curtain Hooks Clear Plastic	  	81
		  		  	Curved Shower Rod	  	79
		  		  	Refrigerator Minibar Black/Grey	  	12
		  	HVAC	  	HVAC	  	79
		  	Lighting	  	Desk Lamp/Shade/Bulb	  	79
		  		  	End Table Lamp/Shade/Bulb	  	12
		  		  	Floor Lamp/Shade/Bulb	  	79
		  		  	Vanity Light	  	79
		  		  	Double Nightstand Lamp	  	40
		  		  	Single Nightstand Lamp	  	78
		  		  	Ceiling Fixture	  	79
		  	Small Appliances	  	Coffee Makers	  	79
		  		  	Iron	  	79
		  		  	Ironing Board	  	79
		  		  	Clock Radio	  	79
		  		  	Telephone	  	158
		  		  	Hairdryer	  	79
		  		  	Drapes: Side Panels, Sheer, Blackout, Fabric Cornice	  	79
				
	 MISCELLANEOUS
	  	Breakroom	  	Table	  	2
		  		  	Chairs	  	9
		  		  	Refrigerator	  	1
		  		  	Microwave	  	1
		  		  	Water Cooler	  	1
		  		  	Lockers	  	30
		  	Exterior	  	Ash/Trash	  	3
		  	Signage	  	Interior - package per Marriott Standards	  	1
		  		  	Exterior - 1 pylon, 1 monument, 2 building	  	4

  

					
		  	5	  	 Purchase Contract
 Exhibit B – List of FF&E

 EXHIBIT D 
 CONSENTS AND APPROVALS 
 Franchisor – Marriott International, Inc. 
  

 1 

 EXHIBIT E 
 ENVIRONMENTAL REPORTS 
 Previously sent electronically on October 2, 2006 to 

Samuel F. Reynolds 
 Apple REIT Companies

 e-mail: sreynolds@applereit.com 
  

 1 

 EXHIBIT F 
 CLAIMS OR LITIGATION PENDING 
 None 
  

 1 

 EXHIBIT G 
 (Intentionally Omitted) 
  

 1 

 EXHIBIT H 
 (Intentionally Omitted) 
  

 1 

 EXHIBIT I 
 NEW MANAGEMENT AGREEMENT 
  

 2 

 EXHIBIT J 
 ALLOCATION OF PURCHASE PRICE 
 The purchase price of $7,332,597.00 will be allocated as follows: 

 

					
	 Class 1
	  	Land	  	$
	 Class 2
	  	Building & Improvements	  	$
	 Class 3
	  	Equipment & Personal Property	  	$

  

 3

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