Document:

exv10w14

Exhibit 10.14

FORM OF

INDEMNIFICATION AGREEMENT

     THIS INDEMNIFICATION AGREEMENT (“Agreement”) is made and entered into as of the _____ day of
__________, 20____, by and between Summit Hotel Properties, Inc., a Maryland corporation (the
“Company”), and ________________________ (“Indemnitee”).

     WHEREAS, at the request of the Company, Indemnitee currently serves as [a director] [and] [an
officer] of the Company and may, therefore, be subjected to claims, suits or proceedings arising as
a result of his service; and

     WHEREAS, as an inducement to Indemnitee to continue to serve as [a director] [and] [an
officer], the Company has agreed to indemnify and to advance expenses and costs incurred by
Indemnitee in connection with any such claims, suits or proceedings, to the maximum extent
permitted by law; and

     WHEREAS, the parties by this Agreement desire to set forth their agreement regarding
indemnification and advance of expenses.

     NOW, THEREFORE, in consideration of the premises and the covenants contained herein, the
Company and Indemnitee do hereby covenant and agree as follows:

     Section 1. Definitions. For purposes of this Agreement:

    (a) “Affiliate” means any entity, whether now or hereafter existing, which controls, is
controlled by, or is under common control with, the Company (including, but not limited to,
joint ventures, limited liability companies and partnerships). For this purpose, the term
“control” (including the correlative meanings of the terms “controlled by” and “under common
control with”) shall mean ownership, directly or indirectly, of 50% or more of the total
combined voting power of all classes of voting securities issued by such entity, or the
possession, directly or indirectly, of the power to direct the management and policies of
such entity, by contract or otherwise.

    (b) “Change in Control” has the same meaning as such term is defined in the Company’s
2010 Equity Incentive Plan.

    (c) “Corporate Requested Status” means the status of a person as a present or former
director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent
of any other Entity (as defined herein) that such person is or was serving in such capacity
at the request of the Company. As a clarification and without limiting the circumstances in
which Indemnitee may be serving at the request of the Company, service by Indemnitee shall
be deemed to be at the request of the Company if Indemnitee serves or served as a director,
trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any
Entity (i) of which a majority of the voting power or equity interest is owned directly or
indirectly by the Company or (ii) the management of which is controlled directly or
indirectly by the Company.

 

 

    (d) “Corporate Status” means the status of a person as a present or former director,
officer, employee or agent of the Company or as a director, trustee, officer, partner,
manager, managing member, fiduciary, employee or agent of any other Entity that such person
is or was serving in such capacity at the request of the Company. As a clarification and
without limiting the circumstances in which Indemnitee may be serving at the request of the
Company, service by Indemnitee shall be deemed to be at the request of the Company if
Indemnitee serves or served as a director, trustee, officer, partner, manager, managing
member, fiduciary, employee or agent of any corporation, real estate investment trust,
partnership, limited liability company, joint venture, trust, employee benefit plan or other
enterprise (i) of which a majority of the voting power or equity interest is owned directly
or indirectly by the Company or (ii) the management of which is controlled directly or
indirectly by the Company.

    (e) “Disinterested Director” means a director of the Company who is not and was not a
party to the Proceeding in respect of which indemnification and/or advance of Expenses is
sought by Indemnitee.

    (f) “Effective Date” means the date set forth in the first paragraph of this Agreement.

    (g) “Entity” means any foreign or domestic corporation, real estate investment trust,
partnership, limited liability company, joint venture, trust, employee benefit plan or other
enterprise.

    (h) “Expenses” means any and all reasonable and out-of-pocket attorneys’ fees and
costs, retainers, court costs, transcript costs, fees of experts, witness fees, travel
expenses, duplicating costs, printing and binding costs, telephone charges, postage,
delivery service fees, federal, state, local or foreign taxes imposed on Indemnitee as a
result of the actual or deemed receipt of any payments under this Agreement, ERISA excise
taxes and penalties and any other disbursements or expenses incurred in connection with
prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing
to be a witness in or otherwise participating in a Proceeding. Expenses shall also include
Expenses incurred in connection with any appeal resulting from any Proceeding including,
without limitation, the premium, security for and other costs relating to any cost bond,
supersedeas bond or other appeal bond or its equivalent.

    (i) “Independent Counsel” means a law firm, or a member of a law firm, that is
experienced in matters of corporation law and neither is, nor in the past five years has
been, retained to represent: (i) the Company or Indemnitee in any matter material to either
such party (other than with respect to matters concerning Indemnitee under this Agreement or
of other indemnitees under similar indemnification agreements), or (ii) any other party to
or participant or witness in the Proceeding giving rise to a claim for indemnification or
advance of Expenses hereunder. Notwithstanding the foregoing, the term “Independent
Counsel” shall not include any person who, under the applicable standards of professional
conduct then prevailing, would have a conflict of interest in representing either the
Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.

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    (j) “Proceeding” means any threatened, pending or completed action, suit, arbitration,
alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or
any other proceeding, whether brought by or in the right of the Company or otherwise and
whether of a civil (including intentional or unintentional tort claims), criminal,
administrative or investigative (formal or informal) nature, including any appeal therefrom,
except one pending or completed on or before the Effective Date, unless otherwise
specifically agreed in writing by the Company and Indemnitee. If Indemnitee reasonably
believes that a given situation may lead to or culminate in the institution of a Proceeding,
such situation shall also be considered a Proceeding.

     Section 2. Services by Indemnitee. Indemnitee will serve as [a director] [and] [an
officer] of the Company. However, this Agreement shall not impose any independent obligation on
Indemnitee or the Company to continue Indemnitee’s service to the Company. This Agreement shall
not be deemed an employment contract between the Company (or any other entity) and Indemnitee.

     Section 3. General. The Company shall indemnify, and advance Expenses to, Indemnitee
(a) as provided in this Agreement and (b) otherwise to the maximum extent permitted by Maryland law
in effect on the Effective Date and as amended from time to time; provided, however, that no change
in Maryland law shall have the effect of reducing the benefits available to Indemnitee hereunder
based on Maryland law as in effect on the Effective Date. The rights of Indemnitee provided in
this Section 3 shall include, without limitation, the rights set forth in the other sections of
this Agreement, including any additional indemnification permitted by Section 2-418(g) of the
Maryland General Corporation Law (the “MGCL”).

     Section 4. Standard for Indemnification. If, by reason of Indemnitee’s Corporate
Status, Indemnitee is, or is threatened to be, made a party to any Proceeding, the Company shall
indemnify Indemnitee against all judgments, penalties, fines and amounts paid in settlement and all
Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection
with any such Proceeding unless it is established that (a) the act or omission of Indemnitee was
material to the matter giving rise to the Proceeding and (i) was committed in bad faith or (ii) was
the result of active and deliberate dishonesty, (b) Indemnitee actually received an improper
personal benefit in money, property or services or (c) in the case of any criminal Proceeding,
Indemnitee had reasonable cause to believe that his conduct was unlawful.

     Section 5. Certain Limits on Indemnification. Notwithstanding any other provision of
this Agreement (other than Section 6), Indemnitee shall not be entitled to:

    (a) indemnification hereunder if the Proceeding was one by or in the right of the
Company and Indemnitee is adjudged to be liable to the Company;

    (b) indemnification hereunder if Indemnitee is adjudged to be liable on the basis that
personal benefit was improperly received in any Proceeding charging improper personal
benefit to Indemnitee, whether or not involving action in the Indemnitee’s Corporate Status;
or

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    (c) indemnification or advance of Expenses hereunder if the Proceeding was brought by
Indemnitee, unless: (i) the Proceeding was brought to enforce indemnification under this
Agreement, and then only to the extent in accordance with and as authorized by Section 12 of
this Agreement, or (ii) the Company’s charter or Bylaws, a resolution of the stockholders
entitled to vote generally in the election of directors or of the Board of Directors or an
agreement approved by the Board of Directors to which the Company is a party expressly
provide otherwise.

     Section 6. Court-Ordered Indemnification. Notwithstanding any other provision of this
Agreement, a court of appropriate jurisdiction, upon application of Indemnitee and such notice as
the court shall require, may order indemnification of Indemnitee by the Company in the following
circumstances:

    (a) if such court determines that Indemnitee is entitled to reimbursement under Section
2-418(d)(1) of the MGCL, the court shall order indemnification, in which case Indemnitee
shall be entitled to recover the Expenses of securing such reimbursement; or

    (b) if such court determines that Indemnitee is fairly and reasonably entitled to
indemnification in view of all the relevant circumstances, whether or not Indemnitee (i) has
met the standards of conduct set forth in Section 2-418(b) of the MGCL or (ii) has been
adjudged liable for receipt of an improper personal benefit under Section 2-418(c) of the
MGCL, the court may order such indemnification as the court shall deem proper. However,
indemnification with respect to any Proceeding by or in the right of the Company or in which
liability shall have been adjudged in the circumstances described in Section 2-418(c) of the
MGCL shall be limited to Expenses.

     Section 7. Indemnification for Expenses of an Indemnitee Who is Wholly or Partially
Successful. Notwithstanding any other provision of this Agreement, and without limiting any
such provision, to the extent that Indemnitee was or is, by reason of his Corporate Status, made a
party to (or otherwise becomes a participant in) any Proceeding and is successful, on the merits or
otherwise, in the defense of such Proceeding, Indemnitee shall be indemnified for all Expenses
actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection therewith.
If Indemnitee is not wholly successful in such Proceeding but is successful, on the merits or
otherwise, as to one or more but less than all claims, issues or matters in such Proceeding, the
Company shall indemnify Indemnitee under this Section 7 for all Expenses actually and reasonably
incurred by Indemnitee or on Indemnitee’s behalf in connection with each such claim, issue or
matter, allocated on a reasonable and proportionate basis. For purposes of this Section 7 and,
without limitation, the termination of any claim, issue or matter in such a Proceeding by
dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim,
issue or matter.

     Section 8. Advance of Expenses for Indemnitee. If, by reason of Indemnitee’s
Corporate Status, Indemnitee is, or is threatened to be, made a party to any Proceeding, the
Company shall, without requiring a preliminary determination of Indemnitee’s ultimate entitlement
to indemnification hereunder, advance all reasonable Expenses incurred by or on behalf of
Indemnitee in connection with such Proceeding within ten days after the receipt by the Company of a
statement or statements requesting such advance or advances from time to time, whether

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prior to or after final disposition of such Proceeding. Such statement or statements shall
reasonably evidence the Expenses incurred by Indemnitee and shall include or be preceded or
accompanied by a written affirmation by Indemnitee of Indemnitee’s good faith belief that the
standard of conduct necessary for indemnification by the Company as authorized by law and by this
Agreement has been met and a written undertaking by or on behalf of Indemnitee, in substantially
the form attached hereto as Exhibit A or in such form as may be required under applicable
law as in effect at the time of the execution thereof, to reimburse the portion of any Expenses
advanced to Indemnitee relating to claims, issues or matters in the Proceeding as to which it shall
ultimately be established that the standard of conduct has not been met by Indemnitee and which
have not been successfully resolved as described in Section 7 of this Agreement. To the extent
that Expenses advanced to Indemnitee do not relate to a specific claim, issue or matter in the
Proceeding, such Expenses shall be allocated on a reasonable and proportionate basis. The
undertaking required by this Section 8 shall be an unlimited general obligation by or on behalf of
Indemnitee and shall be accepted without reference to Indemnitee’s financial ability to repay such
advanced Expenses and without any requirement to post security therefor.

     Section 9. Indemnification and Advance of Expenses as a Witness or Other Participant.
Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is or may be,
by reason of Indemnitee’s Corporate Status, made a witness or otherwise asked to participate in any
Proceeding, whether instituted by the Company or any other party, and to which Indemnitee is not a
party, Indemnitee shall be advanced all reasonable Expenses and indemnified against all Expenses
actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection therewith
within ten days after the receipt by the Company of a statement or statements requesting any such
advance or indemnification from time to time, whether prior to or after final disposition of such
Proceeding. Such statement or statements shall reasonably evidence the Expenses incurred by
Indemnitee.

     Section 10. Procedure for Determination of Entitlement to Indemnification.

    (a) To obtain indemnification under this Agreement, Indemnitee shall submit to the
Company a written request, including therein or therewith such documentation and information
as is reasonably available to Indemnitee and is reasonably necessary to determine whether
and to what extent Indemnitee is entitled to indemnification. Indemnitee may submit one or
more such requests from time to time and at such time(s) as Indemnitee deems appropriate in
Indemnitee’s sole discretion. The officer of the Company receiving any such request from
Indemnitee shall, promptly upon receipt of such a request for indemnification, advise the
Board of Directors in writing that Indemnitee has requested indemnification.

    (b) Upon written request by Indemnitee for indemnification pursuant to Section 10(a)
above, a determination, if required by applicable law, with respect to Indemnitee’s
entitlement thereto shall promptly be made in the specific case: (i) if a Change in Control
shall have occurred, by Independent Counsel, in a written opinion to the Board of Directors,
a copy of which shall be delivered to Indemnitee, which Independent Counsel shall be
selected by the Indemnitee and approved by the Board of Directors in accordance with Section
2-418(e)(2)(ii) of the MGCL, which approval shall not be unreasonably

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withheld; or (ii) if a Change in Control shall not have occurred, (A) by the Board of
Directors by a majority vote of a quorum consisting of Disinterested Directors or, if such a
quorum cannot be obtained, then by a majority vote of a duly authorized committee of the
Board of Directors consisting solely of one or more Disinterested Directors, (B) if
Independent Counsel has been selected by the Board of Directors in accordance with Section
2-418(e)(2)(ii) of the MGCL and approved by the Indemnitee, which approval shall not be
unreasonably withheld, by Independent Counsel, in a written opinion to the Board of
Directors, a copy of which shall be delivered to Indemnitee or (C) if so directed by a
majority of the members of the Board of Directors, by the stockholders of the Company. If
it is so determined that Indemnitee is entitled to indemnification, payment to Indemnitee
shall be made within ten days after such determination. Indemnitee shall cooperate with the
person, persons or entity making such determination with respect to Indemnitee’s entitlement
to indemnification, including providing to such person, persons or entity upon reasonable
advance request any documentation or information which is not privileged or otherwise
protected from disclosure and which is reasonably available to Indemnitee and reasonably
necessary to such determination in the discretion of the Board of Directors or Independent
Counsel if retained pursuant to clause (ii)(B) of this Section 10(b). Any Expenses incurred
by Indemnitee in so cooperating with the person, persons or entity making such determination
shall be borne by the Company (irrespective of the determination as to Indemnitee’s
entitlement to indemnification) and the Company shall indemnify and hold Indemnitee harmless
therefrom.

    (c) The Company shall pay the reasonable fees and expenses of Independent Counsel, if
one is appointed.

     Section 11. Presumptions and Effect of Certain Proceedings.

    (a) In making any determination with respect to entitlement to indemnification
hereunder, the person or persons or entity making such determination shall presume that
Indemnitee is entitled to indemnification under this Agreement if Indemnitee has submitted a
request for indemnification in accordance with Section 10(a) of this Agreement, and the
Company shall have the burden of proof to overcome that presumption in connection with the
making of any determination contrary to that presumption.

    (b) The termination of any Proceeding or of any claim, issue or matter therein, by
judgment, order, settlement or conviction, upon a plea of nolo contendere or its equivalent,
or entry of an order of probation prior to judgment, does not create a presumption that
Indemnitee did not meet the requisite standard of conduct described herein for
indemnification.

    (c) The knowledge and/or actions, or failure to act, of any other director, officer,
employee or agent of the Company or any other director, trustee, officer, partner, manager,
managing member, fiduciary, employee or agent of any other Entity shall not be imputed to
Indemnitee for purposes of determining any other right to indemnification under this
Agreement.

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     Section 12. Remedies of Indemnitee.

    (a) If (i) a determination is made pursuant to Section 10(b) of this Agreement that
Indemnitee is not entitled to indemnification under this Agreement, (ii) advance of Expenses
is not timely made pursuant to Sections 8 or 9 of this Agreement, (iii) no determination of
entitlement to indemnification shall have been made pursuant to Section 10(b) of this
Agreement within 60 days after receipt by the Company of the request for indemnification,
(iv) payment of indemnification is not made pursuant to Sections 7 or 9 of this Agreement
within ten days after receipt by the Company of a written request therefor, or (v) payment
of indemnification pursuant to any other section of this Agreement or the charter or Bylaws
of the Company is not made within ten days after a determination has been made that
Indemnitee is entitled to indemnification, Indemnitee shall be entitled to an adjudication
in an appropriate court located in the State of Maryland, or in any other court of competent
jurisdiction, of Indemnitee entitlement to such indemnification or advance of Expenses.
Alternatively, Indemnitee, at Indemnitee’s option, may seek an award in arbitration to be
conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the
American Arbitration Association. Indemnitee shall commence a proceeding seeking an
adjudication or an award in arbitration within 180 days following the date on which
Indemnitee first has the right to commence such proceeding pursuant to this Section 12(a);
provided, however, that the foregoing clause shall not apply to a proceeding brought by
Indemnitee to enforce his rights under Section 7 of this Agreement. Except as set forth
herein, the provisions of Maryland law (without regard to its conflicts of laws rules) shall
apply to any such arbitration. The Company shall not oppose Indemnitee’s right to seek any
such adjudication or award in arbitration.

    (b) In any judicial proceeding or arbitration commenced pursuant to this Section 12,
Indemnitee shall be presumed to be entitled to indemnification or advance of Expenses, as
the case may be, under this Agreement and the Company shall have the burden of proving that
Indemnitee is not entitled to indemnification or advance of Expenses, as the case may be.
If Indemnitee commences a judicial proceeding or arbitration pursuant to this Section 12,
Indemnitee shall not be required to reimburse the Company for any advances pursuant to
Section 8 of this Agreement until a final determination is made with respect to Indemnitee’s
entitlement to indemnification (as to which all rights of appeal have been exhausted or
lapsed). The Company shall, to the fullest extent not prohibited by law, be precluded from
asserting in any judicial proceeding or arbitration commenced pursuant to this Section 12
that the procedures and presumptions of this Agreement are not valid, binding and
enforceable and shall stipulate in any such court or before any such arbitrator that the
Company is bound by all of the provisions of this Agreement.

    (c) If a determination shall have been made pursuant to Section 10(b) of this Agreement
that Indemnitee is entitled to indemnification, the Company shall be bound by such
determination in any judicial proceeding or arbitration commenced pursuant to this Section
12, absent a misstatement by Indemnitee of a material fact, or an omission of a material
fact necessary to make Indemnitee’s statement not materially misleading, in connection with
the request for indemnification.

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    (d) In the event that Indemnitee, pursuant to this Section 12, seeks a judicial
adjudication of or an award in arbitration to enforce Indemnitee’s rights under, or to
recover damages for breach of, this Agreement, Indemnitee shall be entitled to recover from
the Company, and shall be indemnified by the Company for, any and all Expenses actually and
reasonably incurred by him in such judicial adjudication or arbitration. If it shall be
determined in such judicial adjudication or arbitration that Indemnitee is entitled to
receive part but not all of the indemnification or advance of Expenses sought, the Expenses
incurred by Indemnitee in connection with such judicial adjudication or arbitration shall be
appropriately prorated.

    (e) Interest shall be paid by the Company to Indemnitee at the maximum rate allowed to
be charged for judgments under the Courts and Judicial Proceedings Article of the Annotated
Code of Maryland for amounts which the Company pays or is obligated to pay for the period
(i) commencing with either the tenth day after the date on which the Company was requested
to advance Expenses in accordance with Sections 8 or 9 of this Agreement or the
60th day after the date on which the Company was requested to make the
determination of entitlement to indemnification under Section 10(b) of this Agreement, as
applicable, and (ii) ending on the date such payment is made to Indemnitee by the Company.

     Section 13. Defense of the Underlying Proceeding.

    (a) Indemnitee shall notify the Company promptly in writing upon being served with any
summons, citation, subpoena, complaint, indictment, request or other document relating to
any Proceeding which may result in the right to indemnification or the advance of Expenses
hereunder and shall include with such notice a description of the nature of the Proceeding
and a summary of the facts underlying the Proceeding. The failure to give any such notice
shall not disqualify Indemnitee from the right, or otherwise affect in any manner any right
of Indemnitee, to indemnification or the advance of Expenses under this Agreement unless the
Company’s ability to defend in such Proceeding or to obtain proceeds under any insurance
policy is materially and adversely prejudiced thereby, and then only to the extent the
Company is thereby actually so prejudiced.

    (b) Subject to the provisions of the last sentence of this Section 13(b) and of Section
13(c) below, the Company shall have the right to defend Indemnitee in any Proceeding which
may give rise to indemnification hereunder; provided, however, that the Company shall notify
Indemnitee of any such decision to defend within 15 calendar days following receipt of
notice of any such Proceeding under Section 13(a) above. The Company shall not, without the
prior written consent of Indemnitee, which shall not be unreasonably withheld or delayed,
consent to the entry of any judgment against Indemnitee or enter into any settlement or
compromise which (i) includes an admission of fault of Indemnitee, (ii) does not include, as
an unconditional term thereof, the full release of Indemnitee from all liability in respect
of such Proceeding, which release shall be in form and substance reasonably satisfactory to
Indemnitee or (iii) would impose any Expense, judgment, fine, penalty or limitation on
Indemnitee. This Section 13(b) shall not apply to a Proceeding brought by Indemnitee under
Section 12 of this Agreement.

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    (c) Notwithstanding the provisions of Section 13(b) above, if in a Proceeding to which
Indemnitee is a party by reason of Indemnitee’s Corporate Status, (i) Indemnitee reasonably
concludes, based upon an opinion of counsel approved by the Company, which approval shall
not be unreasonably withheld, that Indemnitee may have separate defenses or counterclaims to
assert with respect to any issue which may not be consistent with other defendants in such
Proceeding, (ii) Indemnitee reasonably concludes, based upon an opinion of counsel approved
by the Company, which approval shall not be unreasonably withheld, that an actual or
apparent conflict of interest or potential conflict of interest exists between Indemnitee
and the Company, or (iii) if the Company fails to assume the defense of such Proceeding in a
timely manner, Indemnitee shall be entitled to be represented by separate legal counsel of
Indemnitee’s choice, subject to the prior approval of the Company, which approval shall not
be unreasonably withheld, at the expense of the Company. In addition, if the Company fails
to comply with any of its obligations under this Agreement or in the event that the Company
or any other person takes any action to declare this Agreement void or unenforceable, or
institutes any Proceeding to deny or to recover from Indemnitee the benefits intended to be
provided to Indemnitee hereunder, Indemnitee shall have the right to retain counsel of
Indemnitee’s choice, subject to the prior approval of the Company, which approval shall not
be unreasonably withheld, at the expense of the Company (subject to Section 12(d) of this
Agreement), to represent Indemnitee in connection with any such matter.

     Section 14. Non-Exclusivity; Survival of Rights; Subrogation.

    (a) The rights of indemnification and advance of Expenses as provided by this Agreement
shall not be deemed exclusive of any other rights to which Indemnitee may at any time be
entitled under applicable law, the charter or Bylaws of the Company, any agreement or a
resolution of the stockholders entitled to vote generally in the election of directors or of
the Board of Directors, or otherwise. Unless consented to in writing by Indemnitee, no
amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or
restrict any right of Indemnitee under this Agreement in respect of any action taken or
omitted by such Indemnitee in his Corporate Status prior to such amendment, alteration or
repeal, regardless of whether a claim with respect to such action or inaction is raised
prior or subsequent to such amendment, alteration or repeal. No right or remedy herein
conferred is intended to be exclusive of any other right or remedy, and every other right or
remedy shall be cumulative and in addition to every other right or remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion of any right or
remedy hereunder, or otherwise, shall not prohibit the concurrent assertion or employment of
any other right or remedy.

    (b) In the event of any payment under this Agreement, the Company shall be subrogated
to the extent of such payment to all of the rights of recovery of Indemnitee, who shall
execute all papers required and take all action necessary to secure such rights, including
execution of such documents as are necessary to enable the Company to bring suit to enforce
such rights.

     Section 15. Insurance. The Company will use its reasonable best efforts to acquire
directors and officers liability insurance, on terms and conditions deemed appropriate by the

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Board of Directors, with the advice of counsel, covering Indemnitee or any claim made against
Indemnitee by reason of his Corporate Status and covering the Company for any indemnification or
advance of Expenses made by the Company to Indemnitee for any claims made against Indemnitee by
reason of his Corporate Status. Without in any way limiting any other obligation under this
Agreement, the Company shall indemnify Indemnitee for any payment by Indemnitee arising out of the
amount of any deductible or retention and the amount of any excess of the aggregate of all
judgments, penalties, fines, settlements and Expenses incurred by Indemnitee in connection with a
Proceeding over the coverage of any insurance referred to in the previous sentence. The purchase,
establishment and maintenance of any such insurance shall not in any way limit or affect the rights
or obligations of the Company or Indemnitee under this Agreement except as expressly provided
herein, and the execution and delivery of this Agreement by the Company and the Indemnitee shall
not in any way limit or affect the rights or obligations of the Company under any such insurance
policies. If, at the time the Company receives notice from any source of a Proceeding to which
Indemnitee is a party or a participant (as a witness or otherwise) the Company has director and
officer liability insurance in effect, the Company shall give prompt notice of such Proceeding to
the insurers in accordance with the procedures set forth in the respective policies.

     Section 16. Coordination of Payments.

    (a) The Company shall not be liable under this Agreement to make any payment of amounts
otherwise indemnifiable or payable or reimbursable as Expenses hereunder if and to the
extent that Indemnitee has otherwise actually received such payment under any insurance
policy, contract, agreement or otherwise.

    (b) The Indemnitee hereby acknowledges that for any claims made against Indemnitee by
reason of his or her Corporate Requested Status that the Company is not the indemnitor of
first resort (i.e., Indemnitee shall request indemnification and/or advancement of Expenses
from such other Entity prior to seeking indemnification and/or advancement of Expenses from
the Company). The Company’s obligations to advance Expenses or to provide indemnification
for the Expenses or liabilities incurred by Indemnitee by reason of his Corporate Requested
Status shall be secondary. No advancement or payment by the Company on behalf of Indemnitee
with respect to any claim for which Indemnitee has sought indemnification from any other
Entity shall affect the foregoing and the Company shall have a right of contribution and/or
be subrogated to the full extent of such advancement or payment to all of the rights of
recovery of Indemnitee against any such Entity.

     Section 17. Reports to Stockholders. To the extent required by the MGCL, the Company
shall report in writing to its stockholders the payment of any amounts for indemnification of, or
advance of Expenses to, Indemnitee under this Agreement arising out of a Proceeding by or in the
right of the Company with the notice of the meeting of stockholders of the Company next following
the date of the payment of any such indemnification or advance of Expenses or prior to such
meeting.

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     Section 18. Duration of Agreement; Binding Effect.

    (a) This Agreement shall continue until and terminate on the later of (i) the date that
Indemnitee shall have ceased to serve as a director, officer, employee or agent of the
Company or as a director, trustee, officer, partner, manager, managing member, fiduciary,
employee or agent of any other Entity that such person is or was serving in such capacity at
the request of the Company and (ii) the date that Indemnitee is no longer subject to any
actual or possible Proceeding (including any rights of appeal thereto and any Proceeding
commenced by Indemnitee pursuant to Section 12 of this Agreement).

    (b) The indemnification and advance of Expenses provided by, or granted pursuant to,
this Agreement shall be binding upon and be enforceable by the parties hereto and their
respective successors and assigns (including any direct or indirect successor by purchase,
merger, consolidation or otherwise to all or substantially all of the business or assets of
the Company), shall continue as to an Indemnitee who has ceased to be a director, officer,
employee or agent of the Company or a director, trustee, officer, partner, manager, managing
member, fiduciary, employee or agent of any other Entity that such person is or was serving
in such capacity at the request of the Company, and shall inure to the benefit of Indemnitee
and Indemnitee’s spouse, assigns, heirs, devisees, executors and administrators and other
legal representatives.

    (c) The Company shall require and cause any successor (whether direct or indirect by
purchase, merger, consolidation or otherwise) to all, substantially all or a substantial
part, of the business and/or assets of the Company, by written agreement in form and
substance satisfactory to Indemnitee, expressly to assume and agree to perform this
Agreement in the same manner and to the same extent that the Company would be required to
perform if no such succession had taken place.

    (d) The Company and Indemnitee agree that a monetary remedy for breach of this
Agreement, at some later date, may be inadequate, impracticable and difficult of proof, and
further agree that such breach may cause Indemnitee irreparable harm. Accordingly, the
parties hereto agree that Indemnitee may enforce this Agreement by seeking injunctive relief
and/or specific performance hereof, without any necessity of showing actual damage or
irreparable harm and that by seeking injunctive relief and/or specific performance,
Indemnitee shall not be precluded from seeking or obtaining any other relief to which
Indemnitee may be entitled. Indemnitee shall further be entitled to such specific
performance and injunctive relief, including temporary restraining orders, preliminary
injunctions and permanent injunctions, without the necessity of posting bonds or other
undertakings in connection therewith. The Company acknowledges that, in the absence of a
waiver, a bond or undertaking may be required of Indemnitee by a court, and the Company
hereby waives any such requirement of such a bond or undertaking.

     Section 19. Severability. If any provision or provisions of this Agreement shall be
held to be invalid, illegal or unenforceable for any reason whatsoever: (a) the validity, legality
and enforceability of the remaining provisions of this Agreement (including, without limitation,
each portion of any Section, paragraph or sentence of this Agreement containing any such provision

-11-

 

held to be invalid, illegal or unenforceable that is not itself invalid, illegal or
unenforceable) shall not in any way be affected or impaired thereby and shall remain enforceable to
the fullest extent permitted by law; (b) such provision or provisions shall be deemed reformed to
the extent necessary to conform to applicable law and to give the maximum effect to the intent of
the parties hereto; and (c) to the fullest extent possible, the provisions of this Agreement
(including, without limitation, each portion of any Section, paragraph or sentence of this
Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not
itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent
manifested thereby.

     Section 20. Identical Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed to be an original but all of which
together shall constitute one and the same Agreement. One such counterpart signed by the party
against whom enforceability is sought shall be sufficient to evidence the existence of this
Agreement.

     Section 21. Headings. The headings of the paragraphs of this Agreement are inserted
for convenience only and shall not be deemed to constitute part of this Agreement or to affect the
construction thereof.

     Section 22. Modification and Waiver. No supplement, modification or amendment of this
Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of
any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other
provisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.

     Section 23. Notices. All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed to have been duly given if (i) delivered by hand
and receipted for by the party to whom said notice or other communication shall have been directed,
on the day of such delivery, or (ii) mailed by certified or registered mail with postage prepaid,
on the third business day after the date on which it is so mailed:

    (a) If to Indemnitee, to the address set forth on the signature page hereto.

    (b) If to the Company, to:

Summit Hotel Properties, Inc.

2701 S. Minnesota Avenue, Suite 6

Sioux Falls, SD 57105

or to such other address as may have been furnished in writing to Indemnitee by the Company or to
the Company by Indemnitee, as the case may be.

     Section 24. Governing Law. This Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of Maryland, without regard to its conflicts of
laws rules.

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     Section 25. Miscellaneous. Use of the masculine pronoun shall be deemed to include
usage of the feminine pronoun where appropriate.

[SIGNATURE PAGE FOLLOWS]

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

	 	 	 	 	 
	 	COMPANY:

SUMMIT HOTEL PROPERTIES, INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	INDEMNITEE:

 	 
	 	  	 	 
	 	 	Name:  	 	 
	 	 	Address:  	 	 

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EXHIBIT A

AFFIRMATION AND UNDERTAKING TO REPAY EXPENSES ADVANCED

To: The Board of Directors of Summit Hotel Properties, Inc.

			
	Re:	 	Affirmation and Undertaking

Ladies and Gentlemen:

     This Affirmation and Undertaking is being provided pursuant to that certain Indemnification
Agreement dated the _____ day of ______________, 20____, by and between Summit Hotel Properties,
Inc., a Maryland corporation (the “Company”), and the undersigned Indemnitee (the “Indemnification
Agreement”), pursuant to which I am entitled to advance of Expenses in connection with [Description
of Proceeding] (the “Proceeding”).

     Terms used herein and not otherwise defined shall have the meanings specified in the
Indemnification Agreement.

     I am subject to the Proceeding by reason of my Corporate Status or by reason of alleged
actions or omissions by me in such capacity. I hereby affirm my good faith belief that at all
times, insofar as I was involved as [a director] [an officer] of the Company, in any of the facts
or events giving rise to the Proceeding, I (1) did not act with bad faith or active or deliberate
dishonesty, (2) did not receive any improper personal benefit in money, property or services and
(3) in the case of any criminal proceeding, had no reasonable cause to believe that any act or
omission by me was unlawful.

     In consideration of the advance of Expenses by the Company for reasonable attorneys’ fees and
related Expenses incurred by me in connection with the Proceeding (the “Advanced Expenses”), I
hereby agree that if, in connection with the Proceeding, it is established that (1) an act or
omission by me was material to the matter giving rise to the Proceeding and (a) was committed in
bad faith or (b) was the result of active and deliberate dishonesty or (2) I actually received an
improper personal benefit in money, property or services or (3) in the case of any criminal
proceeding, I had reasonable cause to believe that the act or omission was unlawful, then I shall
promptly reimburse the portion of the Advanced Expenses relating to the claims, issues or matters
in the Proceeding as to which the foregoing findings have been established.

     IN WITNESS WHEREOF, I have executed this Affirmation and Undertaking on this ___ day of
____________________, 20___.

Name: _____________________________exv10w24

Exhibit 10.24

TAX PROTECTION AGREEMENT

          THIS TAX PROTECTION AGREEMENT (this “Agreement”) is made and entered into as of __________,
2010 by and among SUMMIT HOTEL OP, LP, a Delaware limited partnership (the “Partnership”), and
_______________, a Class___ member (the “Member”) in Summit Hotel Properties, LLC, a South Dakota
limited liability company (the “Merging Entity”).

          WHEREAS, pursuant to that certain Merger Agreement, dated as of ______, 2010, (the “Merger
Agreement”), the Merging Entity will merge into the Partnership, with the Partnership surviving,
with the Member, along with the other members of the Merging Entity, exchanging its interest in the
Merging Entity for partnership units of limited partnership interest in the Partnership (“Units”);

          WHEREAS, it is intended for federal income tax purposes that the Partnership will be treated
as a continuation of the Merging Entity for federal income tax purposes;

          WHEREAS, in consideration for the agreement of the Merging Entity to consummate the merger of
the Merging Entity into the Partnership, the parties desire to enter into this Agreement regarding
certain tax matters as set forth herein; and

          WHEREAS, the Partnership desires to evidence its agreement regarding amounts that may be
payable in the event of certain actions being taken by the Partnership regarding certain debt
obligations of the Partnership and its subsidiaries.

          NOW, THEREFORE, in consideration of the promises and the mutual representations, warranties,
covenants and agreements contained herein and in the Merger Agreement, the parties hereto hereby
agree as follows:

ARTICLE 1

DEFINITIONS

          To the extent not otherwise defined herein, capitalized terms used in this Agreement have the
meanings ascribed to them in the Partnership Agreement (as defined below).

          “Bottom Guarantee” has the meaning set forth in Section 2.1.

          “Closing Date” means the date on which the Merger will be effective.

          “Code” means the Internal Revenue Code of 1986, as amended.

          “Consent” means the prior written consent to do the act or thing for which the consent
is required or solicited, which consent may be executed by a duly authorized officer or agent of
the party granting such consent.

          “Deficit Restoration Obligation” means a written obligation by a Protected Partner to
restore part or all of its deficit capital account in the Partnership upon the occurrence

 

 

of certain events (which written obligation may provide for an indemnity in favor of the REIT as
general partner of the Partnership).

          “Guaranteed Amount” means the aggregate amount of each Guaranteed Debt that is
guaranteed at any time by Partner Guarantors.

          “Guaranteed Debt” means any loans incurred (or assumed) by the Partnership or any of
its subsidiaries that are guaranteed by Partner Guarantors at any time after the Closing Date
pursuant to Article 2 hereof.

          “Indirect Owner” means, in the case of a Protected Partner that is an entity that is
classified as a partnership, disregarded entity or subchapter S corporation for federal income tax
purposes, any person owning an equity interest in such Protected Partner, and in the case of any
Indirect Owner that itself is an entity that is classified as a partnership, disregarded entity or
subchapter S corporation for federal income tax purposes, any person owning an equity interest in
such entity.

          “Liability Amount” means, for each Protected Partner, the amount set forth next to
such Protected Partner’s name on Schedule 2.1(b) hereto.

          “Nonrecourse Liability” has the meaning set forth in Treasury Regulations Section
1.752-1(a)(2).

          “Partner Guarantors” means those Protected Partners who have guaranteed any portion of
the Guaranteed Debt.

          “Partnership” has the meaning set forth in the Preamble.

          “Partnership Agreement” means the First Amended and Restated Agreement of Limited
Partnership of the Partnership, dated as of __________, 2010, as amended, and as the same may be
further amended in accordance with the terms thereof.

          “Protected Partner” means those persons set forth as Protected Partners on Schedule
2.1(a), and any person who (i) acquires Units from a Protected Partner in a transaction in which
gain or loss is not recognized in whole or in part and in which such transferee’s adjusted basis
for federal income tax purposes is determined in whole or in part by reference to the adjusted
basis of the Protected Partner in such Units, (ii) has notified the Partnership of its status as a
Protected Partner and (iii) provides all documentation reasonably requested by the Partnership to
verify such status, but excludes any person that ceases to be a Protected Partner pursuant to this
Agreement.

          “REIT” means Summit Hotel Properties, Inc., a Maryland corporation.

          “Tax Protection Period” means the period commencing on the Closing Date and ending,
with respect to a Protected Partner, at the earlier of such time as (i) such Protected Partner (or
one or more successor Protected Partners) has disposed of 100% of the Units received, directly or
indirectly, in the Merger by such Protected Partner in one or more taxable transactions

2

 

or (ii) the tenth anniversary of the closing of an underwritten initial public offering of the common stock of
the REIT.

          “Units” has the meaning set forth in the Recitals.

ARTICLE 2

ALLOCATION OF LIABILITIES; GUARANTEE AND DEFICIT RESTORATION OBLIGATION OPPORTUNITY

          2.1 Minimum Liability Allocation. During the Tax Protection Period, the Partnership
will offer to each Protected Partner the opportunity, in the Partnership’s discretion, either (i)
to enter into a “bottom dollar guarantee” of certain liabilities of the Partnership (substantially
in the form set forth in Schedule 2.1(c)) pursuant to which the lender for the guaranteed liability
is required to pursue all other collateral and security for the guaranteed liability (other than
any “bottom dollar guarantees”) prior to seeking to collect on such a guarantee, and the lender
shall have recourse against the guarantee only if, and solely to the extent that, the total amount
recovered by the lender with respect to the guaranteed liability after the lender has exhausted its
remedies is less than the aggregate of the guaranteed amounts with respect to such liability, and
the maximum aggregate liability of each partner for all guaranteed liabilities shall be limited to
the amount actually guaranteed by such partner (a “Bottom Guarantee”) or (ii) to enter into a
Deficit Restoration Obligation, in either case in such amount or amounts so as to cause a special
allocation of partnership liabilities to such Protected Partner for purposes of Section 752 of the
Code in an amount equal to such Protected Partner’s Liability Amount (determined as of the Closing
Date) and to cause a special allocation of partnership liabilities for purposes of Section 465 of
the Code that increases the Protected Partner’s “at risk” amount by an amount equal to such
Protected Partner’s Liability Amount (determined as of the Closing Date).

          2.2. Repayment or Refinancing of Guaranteed Debt. If the Partnership, at any time
during the Tax Protection Period applicable to a Partner Guarantor, repays or refinances all or any
portion of any Guaranteed Debt, the Partnership will use commercially reasonable efforts to ensure
that (i) after taking into account such repayment, each Partner Guarantor would be entitled to
include in its basis for its Units an amount of Guaranteed Debt equal to its Liability Amount, or
(ii) alternatively, the Partnership, not less than thirty (30) days prior to such repayment or
refinancing, offers to the applicable Partner Guarantor the opportunity, in the Partnership’s
discretion, either (A) to enter into a Bottom Guarantee with respect to other indebtedness of the
Partnership, or (B) to enter into a Deficit Restoration Obligation, in either case in an amount
sufficient so that, taking into account such Bottom Guarantee of such other Partnership
indebtedness or such Deficit Restoration Obligation, as applicable, each Partner Guarantor who
makes such Bottom Guarantee or enters into a Deficit Restoration Obligation in the amount specified
by the Partnership would be entitled to include in its adjusted tax basis for its Units debt equal to the Liability Amount (determined as of the Closing Date) for such
Partner Guarantor.

          2.3 Deficit Restoration Obligation. The Partnership will use commercially reasonable
efforts to maintain an amount of indebtedness of the Partnership that would be

3

 

considered “recourse” indebtedness (taking into account all of the facts and circumstances related to the
indebtedness, the Partnership and the general partner) equal to or greater than the sum of the
amounts subject to a Deficit Restoration Obligation of all Protected Partners and other partners in
the Partnership. The Deficit Restoration Obligation shall be conclusively presumed to cause the
Protected Partner to be allocated an amount of liabilities equal to the Deficit Restoration
Obligation amount of such Protected Partner for purposes of Sections 465 and 752 of the Code,
provided that (1) the Partnership maintains an amount of debt that is considered “recourse”
indebtedness (determined for purposes of Section 752 of the Code and taking into account all of the
facts and circumstances related to the indebtedness, the Partnership and the general partner) equal
to the aggregate Deficit Restoration Obligation amounts of all partners of the Partnership and (2)
all other terms and conditions of the Partnership Agreement with respect to such Deficit
Restoration Obligation are met.

ARTICLE 3

REMEDIES FOR BREACH

     3.1 Monetary Damages. In the event that the Partnership breaches its obligations set
forth in Article 2 with respect to a Protected Partner the Protected Partner’s sole right shall be
to receive from the Partnership, and the Partnership shall pay to such Protected Partner as
damages, an amount equal to the aggregate federal, state and local income taxes incurred by the
Protected Partner or an Indirect Owner as a result of the income or gain allocated to, or otherwise
recognized by, such Protected Partner with respect to its Units by reason of such breach. For the
avoidance of doubt, so long as the Partnership provides the opportunity to a Protected Partner to
enter into a Bottom Guarantee or Deficit Restoration Obligation pursuant to the forms attached
hereto or otherwise agreed to by the parties and the Partnership uses commercially reasonable
efforts to maintain outstanding the relevant partnership liabilities in accordance with Article 2,
the Partnership shall have no liability pursuant to this Section 3.1 in the event it is determined
that a Protected Partner has not been specially allocated for purposes of Section 752 of the Code
an amount of partnership liabilities equal to such Protected Partner’s Liability Amount or is not
treated as receiving a special allocation of partnership liabilities for purposes of Section 465 of
the Code that increases such Protected Partner’s “at risk” amount by an amount equal to such
Protected Partner’s Liability Amount. Furthermore, the Partnership shall have no liability
pursuant to this Section 3.1 if the Partnership merges into another entity treated as a partnership
for federal income tax purposes or the Protected Partner accepts an offer to exchange its OP Units
for equity interests in another entity treated as a partnership for federal income tax purposes so
long as, in either case, such successor entity assumes or agrees to assume the Partnership’s
obligations pursuant to this Agreement.

          For purposes of computing the amount of federal, state, and local income taxes required to be
paid by a Protected Partner (or Indirect Owner), (i) any deduction for state income taxes payable
as a result thereof actually allowed in computing federal income taxes shall be taken into account,
and (ii) a Protected Partner’s (or Indirect Owner’s) tax liability shall be computed using the highest federal, state and local marginal income tax rates that would be
applicable to such Protected Partner’s (or Indirect Owner’s) taxable income (taking into account
the character and type of such income or gain) for the year with respect to which the taxes must
be paid, without regard to any deductions, losses or credits that may be available to such
Protected Partner (or Indirect Owner) that would reduce or offset its actual taxable income or

4

 

actual tax liability if such deductions, losses or credits could be utilized by the Protected
Partner (or Indirect Owner) to offset other income, gain or taxes of the Protected Partner (or
Indirect Owner), either in the current year, in earlier years, or in later years).

     3.2 Process for Determining Damages. If the Partnership has breached or violated any
of the covenants set forth in Article 2 (or a Protected Partner asserts that the Partnership has
breached or violated any of the covenants set forth in Article 2), the Partnership and the
Protected Partner (or Indirect Owner) agree to negotiate in good faith to resolve any disagreements
regarding any such breach or violation and the amount of damages, if any, payable to such Protected
Partner (or Indirect Owner) under Section 3.1. If any such disagreement cannot be resolved
by the Partnership and such Protected Partner (or Indirect Owner) within sixty (60) days after the
receipt of notice from the Partnership of such breach and the amount of income to be recognized by
reason thereof (or, if applicable, receipt by the Partnership of an assertion by a Protected
Partner that the Partnership has breached or violated any of the covenants set forth in Article 2),
the Partnership and the Protected Partner shall jointly retain a nationally recognized independent
public accounting firm (“an Accounting Firm”) to act as an arbitrator to resolve as expeditiously
as possible all points of any such disagreement (including, without limitation, whether a breach of
any of the covenants set forth Article 2 has occurred and, if so, the amount of damages to which
the Protected Partner is entitled as a result thereof, determined as set forth in Section
3.1). All determinations made by the Accounting Firm with respect to the resolution of any
breach or violation of any of the covenants set forth in Article 2 and the amount of damages
payable to the Protected Partner under Section 3.1 shall be final, conclusive and binding
on the Partnership and the Protected Partner. The fees and expenses of any Accounting Firm
incurred in connection with any such determination shall be shared equally by the Partnership and
the Protected Partner, provided that if the amount determined by the Accounting Firm to be owed by
the Partnership to the Protected Partner is more than five percent (5%) higher than the amount
proposed by the Partnership to be owed to such Protected Partner prior to the submission of the
matter to the Accounting Firm, then all of the fees and expenses of any Accounting Firm incurred in
connection with any such determination shall be paid by the Partnership and if the amount
determined by the Accounting Firm to be owed by the Partnership to the Protected Partner is more
than five percent (5%) less than the amount proposed by the Partnership to be owed to such
Protected Partner prior to the submission of the matter to the Accounting Firm, then all of the
fees and expenses of any Accounting Firm incurred in connection with any such determination shall
be paid by the Protected Partner.

     3.3 Required Notices; Time for Payment. In the event that there has been a breach of
Article 2, the Partnership shall provide to each affected Protected Partner notice of the
transaction or event giving rise to such breach not later than at such time as the Partnership
provides to the Protected Partners the IRS Schedule K-1’s to the Partnership’s federal income tax
return. All payments required under this Article 3 to any Protected Partner shall be made to such
Protected Partner on or before April 15 of the year following the year in which the gain
recognition event giving rise to such payment took place; provided that, if the Protected
Partner is required to make estimated tax payments that would include such gain (taking into
account all available safe harbors), the Partnership shall make a payment to the Protected Partner
on or before the due date for such estimated tax payment and such payment from the Partnership
shall be in an amount that corresponds to the amount of the estimated tax being paid by such
Protected

5

 

Partner at such time. In the event of a payment required after the date required
pursuant to this Section 3.3, interest shall accrue on the aggregate amount required to be
paid from such date to the date of actual payment at a rate equal to the “prime rate” of interest,
as published in the Wall Street Journal (or if no longer published there, as announced by Citibank,
N.A.) effective as of the date the payment is required to be made.

ARTICLE 4

AMENDMENT OF THIS AGREEMENT; WAIVER OF CERTAIN PROVISIONS; APPROVAL OF CERTAIN TRANSACTIONS

     4.1 Amendment. This Agreement may not be amended, directly or indirectly (including
by reason of a merger between either the Partnership or the REIT and another entity) except by a
written instrument signed by the Partnership and each of the Protected Partners to be subject to
such amendment, except that the Partnership may amend Schedules 2.1(a) and 2.1(b)
upon a person becoming a Protected Partner as a result of a transfer of Units.

     4.2 Waiver. Notwithstanding the foregoing, upon written request by the Partnership,
each Protected Partner, in its sole discretion, may waive the payment of any damages that are
otherwise payable to such Protected Partner pursuant to Article 3 hereof. Such a waiver shall be
effective only if obtained in writing from the affected Protected Partner.

ARTICLE 5

MISCELLANEOUS

     5.1 Additional Actions and Documents. Each of the parties hereto hereby agrees to
take or cause to be taken such further actions, to execute, deliver, and file or cause to be
executed, delivered and filed such further documents, and will obtain such consents, as may be
necessary or as may be reasonably requested in order to fully effectuate the purposes, terms and
conditions of this Agreement.

     5.2 Assignment. No party hereto shall assign its or his rights or obligations under
this Agreement, in whole or in part, except by operation of law, without the prior written consent
of the other parties hereto, and any such assignment contrary to the terms hereof shall be null and
void and of no force and effect.

     5.3 Successors and Assigns. This Agreement shall be binding upon and shall inure to
the benefit of the Protected Partners and their respective successors and permitted assigns,
whether so expressed or not. This Agreement shall be binding upon the Partnership and any entity
that is a direct or indirect successor, whether by merger, transfer, spin-off or otherwise, to all
or substantially all of the assets of the Partnership (or any prior successor thereto as set forth
in the preceding portion of this sentence), provided that none of the foregoing shall result in the
release of liability of the Partnership hereunder. The Partnership covenants with and for the
benefit of the Protected Partners not to undertake any transfer of all or substantially all of the
assets of either entity (whether by merger, transfer, spin-off or otherwise) unless the transferee
has acknowledged in writing and agreed in writing to be bound by this Agreement, provided that

6

 

the
foregoing shall not be deemed to permit any transaction otherwise prohibited by this Agreement.

     5.4 Modification; Waiver. No failure or delay on the part of any party hereto in
exercising any power or right hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof or the exercise of
any other right or power. The rights and remedies of the parties hereunder are cumulative and not
exclusive of any rights or remedies which they would otherwise have. No modification or waiver of
any provision of this Agreement, nor consent to any departure by any party therefrom, shall in any
event be effective unless the same shall be in writing, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given. No notice to or
demand on any party in any case shall entitle such party to any other or further notice or demand
in similar or other circumstances.

     5.5 Representations and Warranties Regarding Authority; Noncontravention. The
Partnership has the requisite power and authority to enter into this Agreement and to perform its
obligations hereunder. The execution and delivery of this Agreement by the Partnership and the
performance of each of its obligations hereunder have been duly authorized by all necessary
partnership action on the part of the Partnership. This Agreement has been duly executed and
delivered by the Partnership and constitutes a valid and binding obligation of the Partnership,
enforceable against the Partnership in accordance with its terms, except as such enforcement may be
limited by (i) applicable bankruptcy or insolvency laws (or other laws affecting creditors’ rights
generally) or (ii) general principles of equity. The execution and delivery of this Agreement by
the Partnership does not, and the performance of each of its respective obligations hereunder will
not, conflict with, or result in any violation of (i) the Partnership Agreement or (ii) any other
agreement applicable to the Partnership, other than, in the case of clause (ii), any such conflicts
or violations that would not materially adversely affect the performance by the Partnership of its
obligations hereunder.

     5.6 Captions. The Article and Section headings contained in this Agreement are
inserted for convenience of reference only, shall not be deemed to be a part of this Agreement for
any purpose, and shall not in any way define or affect the meaning, construction or scope of any of
the provisions hereof.

     5.7 Notices. All notices and other communications given or made pursuant hereto shall
be in writing, shall be deemed to have been duly given or made as of the date delivered, mailed or
transmitted, and shall be effective upon receipt, if delivered personally, mailed by registered or
certified mail (postage prepaid, return receipt requested) to the parties at the following
addresses (or at such other address for a party as shall be specified by like changes of address)
or sent by electronic transmission to the telecopier number specified below:

     (i) if to the Partnership, to:

Summit Hotel OP, LP

2701 South Minnesota Avenue, Suite 6

Sioux Falls, South Dakota 57105

Attention: Chris Eng, Esq.

Telecopier No. (605) 362-9388

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     (ii) if to a Protected Partner, to the address on file with the Partnership.

Each party may designate by notice in writing a new address to which any notice, demand, request or
communication may thereafter be so given, served or sent. Each notice, demand, request, or
communication which shall be hand delivered, sent, mailed, telecopied or telexed in the manner
described above, or which shall be delivered to a telegraph company, shall be deemed sufficiently
given, served, sent, received or delivered for all purposes at such time as it is delivered to the
addressee (with the return receipt, the delivery receipt, or (with respect to a telecopy or telex)
the answerback being deemed conclusive, but not exclusive, evidence of such delivery) or at such
time as delivery is refused by the addressee upon presentation.

     5.8 Counterparts. This Agreement may be executed in two or more counterparts, all of
which shall be considered one and the same agreement and each of which shall be deemed an original.

     5.9 Governing Law. The interpretation and construction of this Agreement, and all
matters relating thereto, shall be governed by the laws of the State of Delaware, without regard to
the choice of law provisions thereof.

     5.10 Consent to Jurisdiction; Enforceability.

          5.10.1 This Agreement and the duties and obligations of the parties hereunder shall be
enforceable against any of the parties in the courts of the State of South Dakota. For such
purpose, each party hereto and the Protected Partners hereby irrevocably submits to the
nonexclusive jurisdiction of such courts and agrees that all claims in respect of this Agreement
may be heard and determined in any of such courts.

          5.10.2 Each party hereto hereby irrevocably agrees that a final judgment of any of the courts
specified above in any action or proceeding relating to this Agreement shall be conclusive and may
be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.

     5.11 Severability. If any part of any provision of this Agreement shall be invalid or
unenforceable in any respect, such part shall be ineffective to the extent of such invalidity or
unenforceability only, without in any way affecting the remaining parts of such provision or the
remaining provisions of this Agreement.

     5.12 Costs of Disputes. Except as otherwise expressly set forth in this Agreement,
the nonprevailing party in any dispute arising hereunder shall bear and pay the costs and expenses
(including, without limitation, reasonable attorneys’ fees and expenses) incurred by the prevailing
party or parties in connection with resolving such dispute.

     5.13 Enforcement by Protected Partners. The Protected Partners are the beneficiaries
of this Agreement and shall be able to enforce this Agreement as if they were parties to this
Agreement.

8

 

     IN WITNESS WHEREOF, the Partnership and the Member have caused this Agreement to be signed by
their respective officers, general partners, or delegates thereunto duly authorized all as of the
date first written above.

	 	 	 	 	 	 	 	 	 	 	 

	 	 	SUMMIT HOTEL OP, LP,	 	 
	 	 	a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Summit Hotel Properties, Inc.,	 	 
	 	 	 	 	 	 	a Maryland corporation,	 	 
	 	 	 	 	 	 	its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	Name:	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	Title:	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	[MEMBER (entity)]	 	 
	 

	 	a	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	[MEMBER (individual)]	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 

9

 

SCHEDULES AND EXHIBITS TO THE TAX PROTECTION AGREEMENT

	 	 	 
	Schedule 2.1(a)

	 	List of Protected Partners
	 	 	 
	Schedule 2.1(b)

	 	Liability Amount
	 	 	 
	Schedule 2.1(c)

	 	Form of Guarantee Agreement
	 	 	 

10

 

Schedule 2.1(a)

List of Protected Partners

11

 

Exhibit 10.24

Schedule 2.1(b)

Liability Amount

	 	 	 
	Protected Partner	 	Liability Amount **/
	 
	 	 
	 
	 	 
	 
	 	 
	 
	 	 
	 
	 	 
	 
	 	 
	 
	 	 
	 
	 	 

**/ The estimated “negative tax capital account” of a Partner in the Partnership on the
closing date of the IPO that would be recognized as a result of the repayment of liabilities with
IPO proceeds, as determined by the Partnership in its sole discretion.

 

Schedule 2.1(c)

Form of Guaranty 1/

GUARANTEE

     This Guarantee is made and entered into as of the __ day of _______ 20__, by the persons
listed on Exhibit A annexed hereto (the “Guarantors”) for the benefit of the Lender set

 

			
	1/	 	This Form of the Guarantee Agreement is for Guaranteed Debt where the following conditions all are applicable:

	 	(i)	 	there are no other guarantees in effect with
respect to such Guaranteed Debt;
	 
	 	(ii)	 	the collateral securing such Guaranteed Debt
is not collateral for any other indebtedness
that is senior to or pari passu with such
Guaranteed Debt;
	 
	 	(iii)	 	no additional guarantees with respect to
such Guaranteed Debt will be entered into during
the applicable Tax Protection Period;
	 
	 	(iv)	 	the lender with respect to such Guaranteed
Debt is not the Partnership or other entity in
which the Partnership owns a direct or indirect
interest, the REIT, any other partner in the
Partnership, or any person related to any
partner in the Partnership as determined for
purposes of Treasury Regulations
Section 1.752-2; and
	 
	 	(v)	 	none of the REIT, nor any other partner in
the Partnership, nor any person related to any
partner in the Partnership as determined for
purposes of Treasury Regulations Section 1.752-2
shall have provided, or shall thereafter
provide, collateral for, or otherwise shall have
entered, or thereafter shall enter, into a
relationship that would cause such person or
entity to be considered to bear risk of loss
with respect to such Guaranteed Debt, as
determined for purposes of Treasury Regulations
Section 1.752-2.

     If, and to the extent that, one or more of these conditions is not
applicable, appropriate changes to the attached Form of Guaranty will be
required in order to cause the various conditions set forth in Article 2 of the
Tax Protection Agreement to be satisfied.

 

 

forth on Exhibit B annexed hereto and made a part hereof (the “Lender,” which
term shall include any person or entity who hereafter holds the Note (as defined below) in accordance with the terms thereof).

RECITALS

     WHEREAS, the Lender has loaned to the borrower set forth on Exhibit B (the
“Borrower”) the amount set forth opposite such Lender’s name on Exhibit B, which
loan (i) is evidenced by the promissory note described on Exhibit C hereto (the
“Note”), (ii) has a current outstanding balance in the amount set forth on Exhibit
B annexed hereto, and (iii) is secured by a mortgage or deed of trust on the collateral
described on Exhibit D annexed hereto (the “Deed of Trust,” with the property and
other assets securing such Deed of Trust referred to as the “Collateral”);

     WHEREAS, the Borrower is either Summit Hotel OP, LP, a Delaware limited partnership (the
“Partnership”), or a subsidiary of the Partnership in which the Partnership owns a 98% or
greater interest in the subsidiary;

     WHEREAS, the Guarantors are limited partners in the Partnership; and

     WHEREAS, the Guarantors are executing and delivering this Guarantee to guarantee a portion of
the Borrower’s payments with respect to the Note, subject to and otherwise in accordance with the
terms and conditions hereinafter set forth.

     NOW THEREFORE, in consideration of the foregoing recitals and facts and other good and
valuable consideration, the receipt and legal sufficiency of which are hereby acknowledged, each of
the Guarantors hereby agree as follows:

     1. Guarantee and Performance of Payment.

     (a) The Guarantors hereby irrevocably and unconditionally guarantee the collection by the
Lender of, and hereby agree to pay to the Lender upon demand (following (1) foreclosure of the Deed
of Trust, exercise of the powers of sale thereunder and/or acceptance by the Lender of a deed to
the Collateral in lieu of foreclosure, and (2) the exhaustion of the exercise of any and all
remedies available to the Lender against the Borrower, including, without limitation, realizing
upon the assets of the Borrower other than the Collateral against which the Lender may have
recourse), an amount equal to the excess, if any, of the Guaranteed Amount set forth on Exhibit
B over the Lender Proceeds (as hereinafter defined) (which excess is referred to as the
“Aggregate Guarantee Liability”). The amounts payable by each Guarantor in respect of the
guarantee obligations hereunder shall be in the same proportion as the dollar amounts listed next
to such Guarantor’s name on Exhibit A attached hereto bears to the total Guaranteed Amount
set forth on Exhibit A, provided that, notwithstanding anything to the contrary contained
in this Guarantee, each Guarantor’s aggregate obligation under this Guarantee shall be limited to
the dollar amount set forth on Exhibit A attached hereto next to such Guarantor’s name.
The Guarantors’ obligations as set forth in this paragraph 1(a) are hereinafter referred to as the
“Guaranteed Obligations.”

 

 

     (b) For the purposes of this Guarantee, the term “Lender Proceeds” shall mean the
aggregate of (i) the Foreclosure Proceeds (as hereinafter defined) plus (ii) all amounts collected
by the Lender from the Borrower (other than payments of principal, interest or other amounts
required to be paid by the Borrower to Lender under the terms of the Note that are paid by the
Borrower to the Lender at a time when no default has occurred under the Note and is continuing) or
realized by the Lender from the sale of assets of the Borrower other than the Collateral.

     (c) For the purposes of this Guarantee, the term “Foreclosure Proceeds” shall have the
applicable meaning set forth below with respect to the Collateral:

	 	1.	 	If at least one bona fide third party unrelated to the Lender
(and including, without limitation, any of the Guarantors) bids for such
Collateral at a sale thereof, conducted upon foreclosure of the related Deed of
Trust or exercise of the power of sale thereunder, Foreclosure Proceeds shall
mean the highest amount bid for such Collateral by the party that acquires
title thereto (directly or through a nominee) at or pursuant to such sale. For
the purposes of determining such highest bid, amounts bid for the Collateral by
the Lender shall be taken into account notwithstanding the fact that such bids
may constitute credit bids which offset against the amount due to the Lender
under the Note.
	 
	 	2.	 	If there is no such unrelated third-party at such sale of the
Collateral so that the only bidder at such sale is the Lender or its designee,
the Foreclosure Proceeds shall be deemed to be fair market value (the “Fair
Market Value”) of the Collateral as of the date of the foreclosure sale, as
such Fair Market Value shall be mutually agreed upon by the Lender and the
Guarantor or determined pursuant to subparagraph 1(d).
	 
	 	3.	 	If the Lender receives and accepts a deed to the Collateral in
lieu of foreclosure in partial satisfaction of the Borrower’s obligations under
the Note, the Foreclosure Proceeds shall be deemed to be the Fair Market Value
of such Collateral as of the date of delivery of the deed-in-lieu of
foreclosure, as such Fair Market Value shall be mutually agreed upon by the
Lender and the Guarantor or determined pursuant to subparagraph 1(d).

     (d) Fair Market Value of the Collateral (or any item thereof) shall be the price at which a
willing seller not compelled to sell would sell such Collateral, and a willing buyer not compelled
to buy would purchase such Collateral, free and clear of all mortgages but subject to all leases
and reciprocal easements and operating agreements. If the Lender and the Guarantor are unable to
agree upon the Fair Market Value of any Collateral in accordance with subparagraphs (c)1., 2. or 3.
above, as applicable, within twenty (20) days after the date of the foreclosure sale or the
delivery of the deed-in-lieu of foreclosure, as applicable, relating to such Collateral, either
party may have the Fair Market Value of such Collateral determined by appraisal by appointing an
appraiser having the qualifications set forth below to determine the same and by notifying the
other party of such appointment within twenty (20) days after the expiration of such twenty (20)
day period. If the other party shall fail to notify the first party, within twenty (20) days after
its receipt of notice of the appointment by the first party, of the

 

 

appointment by the other party of an appraiser having the qualifications set forth below, the
appraiser appointed by the first party shall alone make the determination of such Fair Market
Value. Appraisers appointed by the parties shall be members of the Appraisal Institute (MAI) and
shall have at least ten years’ experience in the valuation of properties similar to the Collateral
being valued in the greater metropolitan area in which such Collateral is located. If each party
shall appoint an appraiser having the aforesaid qualifications and if such appraisers cannot,
within thirty (30) days after the appointment of the second appraiser, agree upon the determination
hereinabove required, then they shall select a third appraiser which third appraiser shall have the
aforesaid qualifications, and if they fail so to do within forty (40) days after the appointment of
the second appraiser they shall notify the parties hereto, and either party shall thereafter have
the right, on notice to the other, to apply for the appointment of a third appraiser to the chapter
of the American Arbitration Association or its successor organization located in the metropolitan
area in which the Collateral is located or to which the Collateral is proximate or if no such
chapter is located in such metropolitan area, in the metropolitan area closest to the Collateral in
which such a chapter is located. Each appraiser shall render its decision as to the Fair Market
Value of the Collateral in question within thirty (30) days after the appointment of the third
appraiser and shall furnish a copy thereof to the Lender and the Guarantor. The Fair Market Value
of the Collateral shall then be calculated as the average of (i) the Fair Market Value determined
by the third appraiser and (ii) whichever of the Fair Market Values determined by the first two
appraisers is closer to the Fair Market Value determined by the third appraiser; provided, however,
that if the Fair Market Value determined by the third appraiser is higher or lower than both Fair
Market Values determined by the first two appraisers, such Fair Market Value determined by the
third appraiser shall be disregarded and the Fair Market Value of the Collateral shall then be
calculated as the average of the Fair Market Value determined by the first two appraisers. The
Fair Market Value of a Property, as so determined, shall be binding and conclusive upon the Lender
and the Guarantors. A Guarantor shall bear the cost of its own appraiser and, subject to
subparagraph 1(e), shall bear all reasonable costs of appointing, and the expenses of, any other
appraiser appointed pursuant to this subparagraph (1)(d).

     (e) Notwithstanding anything in the preceding subparagraphs of this paragraph 1, (i) in no
event shall the aggregate amount required to be paid pursuant to this Guarantee by the Guarantors
as a group with respect to all defaults under the Note and the Deed of Trust securing the
obligations thereunder exceed the Guaranteed Amount set forth on Exhibit B hereto, and (ii)
the aggregate obligation of each Guarantor hereunder with respect to the Guaranteed Obligation
shall be limited to the lesser of (I) the product of (w) the Individual Guarantee Percentage for
such Guarantor set forth on Exhibit A hereto multiplied by (x) the Guaranteed Amount, or
(II) the product of (y) such Guarantor’s Individual Guarantee Percentage multiplied by (z) the
Aggregate Guarantee Liability.

     (f) In confirmation of the foregoing, and without limitation, the Lender must first exhaust
all of its rights and remedies against all property of the Borrower as to which the Lender has (or
may have) a right of recourse, including, without limitation, the institution and prosecution to
completion of appropriate foreclosure proceedings under the Deed of Trust, before exercising any
right or remedy or making any claim, under this Guarantee.

     (g) The obligations under this Guarantee shall be personal to each Guarantor and shall not be
affected by any transfer of all or any part of a Guarantor’s interests in the

 

 

Partnership; provided, however, that if a Guarantor has disposed of all of its equity
interests in the Partnership, the obligations of such Guarantor under this Guarantee shall
terminate 12 months after the date of such disposition (the “Termination Date”) provided (i) the
Guarantor notifies the Lender that it is terminating its obligations under this Guarantee as of the
Termination Date and (ii) the fair market value of the Collateral exceeds the outstanding balance
of the Note, including accrued and unpaid interest, as of the Termination Date. Further, no
Guarantor shall have the right to recover from the Borrower any amounts such Guarantor pays
pursuant to this Guarantee (except and only to the extent that the amount paid to the Lender by
such Guarantor exceeds the amount required to be paid by such Guarantor under the terms of this
Guarantee).

     (h) The obligations of any Guarantor who is an individual as a Guarantor hereunder shall
terminate with respect to such Guarantor one week after the death of such Guarantor if, as a result
of the death of such Guarantor, all property held by the Guarantor on the date of death would have
a basis for federal income tax purposes equal to the fair market value of such property on such
date (unless a later date were to be elected by the executor of the Guarantor’s estate in
accordance with the applicable provisions of the Internal Revenue Code).

     2. Intent to Benefit Lender. This Guarantee is expressly for the benefit of the
Lender. The Guarantors intend that the Lender shall have the right to enforce the obligations of
the Guarantors hereunder separately and independently of the Borrower, subject to the provisions of
paragraph 1 hereof, without any requirement whatsoever of resort by the Lender to any other party.
The Lender’s rights to enforce the obligations of the Guarantors hereunder are material elements of
this Guarantee. This Guarantee shall not be modified, amended or terminated (other than as
specifically provided herein) without the written consent of the Lender. The Borrower shall
furnish a copy of this Guarantee to the Lender contemporaneously with its execution.

     3. Waivers. Each Guarantor intends to bear the ultimate economic responsibility for
the payment hereof of the Guaranteed Obligations to the extent set forth in Paragraph 1 above.
Pursuant to such intent:

          (a) Except as expressly set forth in Paragraph 1 above, each Guarantor expressly waives any
right (pursuant to any law, rule, arrangement or relationship) to compel the Lender, or any
subsequent holder of the Note or any beneficiary of the Deed of Trust to sue or enforce payment
thereof or pursue any other remedy in the power of the Borrower, the Lender or any subsequent
holder of the Note or any beneficiary of the Deed of Trust whatsoever, and failure of the Borrower
or the Lender or any subsequent holder of the Note or any beneficiary of the Deed of Trust to do so
shall not exonerate, release or discharge a Guarantor from its absolute unconditional obligations
under this Guarantee. Each Guarantor hereby binds and obligates itself, and its permitted
successors and assignees, for performance of the Guaranteed Obligations according to the terms
hereof, whether or not the Guaranteed Obligations or any portion thereof are valid now or hereafter
enforceable against the Borrower or shall have been incurred in compliance with any of the
conditions applicable thereto, subject, however, in all respects to the Guarantee Limit and the
other limitations set forth in paragraph 1.

          (b) Each Guarantor expressly waives any right (pursuant to any law, rule, arrangement, or
relationship) to compel any other person (including, but not limited to, the

 

 

Borrower, the Partnership, any subsidiary of the Partnership or the Borrower, or any other
partner or affiliate of the Partnership or the Borrower) to reimburse or indemnify such Guarantor
for all or any portion of amounts paid by such Guarantor pursuant to this Guarantee to the extent
such amounts do not exceed the amounts required to be paid by such Guarantor pursuant to paragraph
1 hereof (taking into account the limitations set forth therein).

          (c) Except as expressly set forth in Paragraph 1 above, if and only to the extent that the
Borrower has made similar waivers under the Note or the Deed of Trust, each Guarantor expressly
waives: (i) the defense of the statute of limitations in any action hereunder or for the
collection or performance of the Note or the Deed of Trust; (ii) any defense that may arise by
reason of: the incapacity, or lack of authority of the Borrower, the revocation or repudiation
hereof by such Guarantor, the revocation or repudiation of the Note or the Deed of Trust by the
Borrower, the failure of the Lender to file or enforce a claim against the estate (either in
administration, bankruptcy or any other proceeding) of the Borrower; the unenforceability in whole
or in part of the Note, the Deed of Trust or any other document or instrument related thereto; the
Lender’s election, in any proceeding by or against the Borrower under the federal Bankruptcy Code,
of the application of Section 1111(b)(2) of the federal Bankruptcy Code; or any borrowing or grant
of a security interest under Section 364 of the federal Bankruptcy Code; (iii) presentment, demand
for payment, protest, notice of discharge, notice of acceptance of this Guarantee or occurrence of,
or any default in connection with, the Note or the Deed of Trust, and indulgences and notices of
any other kind whatsoever, including, without limitation, notice of the disposition of any
collateral for the Note; (iv) any defense based upon an election of remedies (including, if
available, an election to proceed by non-judicial foreclosure) or other action or omission by the
Lender or any other person or entity which destroys or otherwise impairs any indemnification,
contribution or subrogation rights of such Guarantor or the right of such Guarantor, if any, to
proceed against the Borrower for reimbursement, or any combination thereof; (v) subject to
Paragraph 4 below, any defense based upon any taking, modification or release of any collateral or
guarantees for the Note, or any failure to create or perfect any security interest in, or the
taking of or failure to take any other action with respect to any collateral securing payment or
performance of the Note; (vi) any rights or defenses based upon any right to offset or claimed
offset by such Guarantor against any indebtedness or obligation now or hereafter owed to such
Guarantor by the Borrower; or (vii) any rights or defenses based upon any rights or defenses of the
Borrower to the Note or the Deed of Trust (including, without limitation, the failure or value of
consideration, any statute of limitations, accord and satisfaction, and the insolvency of the
Borrower); it being intended, except as expressly set forth in Paragraph 1 above, that such
Guarantor shall remain liable hereunder, to the extent set forth herein, notwithstanding any act,
omission or thing which might otherwise operate as a legal or equitable discharge of any of such
Guarantor or of the Borrower.

     4. Amendment of Note and Deed of Trust. Without in any manner limiting the generality
of the foregoing, the Lender or any subsequent holder of the Note or beneficiary of the Deed of
Trust may, from time to time, without notice to or consent of the Guarantors, agree to any
amendment, waiver, modification or alteration of the Note or the Deed of Trust relating to the
Borrower and its rights and obligations thereunder (including, without limitation, renewal, waiver
or variation of the maturity of the indebtedness evidenced by the Note, increase or reduction of
the rate of interest payable under the Note, release, substitution or addition of any Guarantor or
endorser and acceptance or release of any security for the Note), it being

 

 

understood and agreed by the Lender, however, that the Guarantor’s obligations hereunder are
subject, in all events, to the limitations set forth in Paragraph 1; provided that (i) in the event
that the Lender consents to the release of any Collateral securing the Note pursuant to the Deed of
Trust, the Guaranteed Amount shall be reduced by the Fair Market Value of such Collateral on the
date of such release (determined as set forth in Section 1(d)); and (ii) upon any material change
to the Note or the Deed of Trust, including, without limitation, the maturity date or the interest
rate of the Note, or upon any release or substitution of any Collateral securing the Note, within
thirty (30) days of any Guarantor’s receipt of actual notice of such event, subject to the
following sentence, such Guarantor may elect to terminate such Guarantor’s obligations under this
Guarantee by written notice to the Lender. Such termination shall take effect on the 31st day
following such actual notice, provided that no default under the Guaranteed Obligation has occurred
and is then continuing.

     5. Termination of Guarantee. Subject to Paragraph 4, this Guarantee is irrevocable as
to any and all of the Guaranteed Obligations.

     6. Independent Obligations. Except as expressly set forth in Paragraph 1, the
obligations of each Guarantor hereunder are independent of the obligations of the Borrower, and a
separate action or actions may be brought by a Lender against the Guarantors, whether or not
actions are brought against the Borrower. Each Guarantor expressly waives any and all rights of
subrogation, reimbursement, indemnity, exoneration, contribution or any other claim which such
Guarantor may now or hereafter have against the Borrower, or any other person directly or
contingently liable for the payment or performance of the Note and the Deed of Trust arising from
the existence or performance of this Guarantee (including, but not limited to, the Partnership,
Summit Hotel Properties, Inc., or any other partner of the Partnership) (except and only to the
extent that a Guarantor makes a payment to the Lender in excess of the amount required to be paid
under Paragraph 1 and the limitations set forth therein).

     7. Understanding With Respect to Waivers. Each Guarantor warrants and represents that
each of the waivers set forth above are made with full knowledge of their significance and
consequences, and that under the circumstances, the waivers are reasonable and not contrary to
public policy or law. If any of said waivers are determined to be contrary to any applicable law
or public policy, such waiver shall be effective only to the maximum extent permitted by law.

     8. No Assignment. No Guarantor shall be entitled to assign his or her rights or
obligations under this Guarantee to any other person without the written consent of the Lender.

     9. Entire Agreement. The parties agree that this Guarantee contains the entire
understanding and agreement between them with respect to the subject matter hereof and cannot be
amended, modified or superseded, except by an agreement in writing signed by the parties.

     10. Notices. Any notice given pursuant to this Guarantee shall be in writing and
shall be deemed given when delivered personally, or sent by registered or certified mail, postage
prepaid, as follows:

 

 

     If to the Partnership:

Summit Hotel OP, LP

2701 South Minnesota Avenue, Suite 6

Sioux Falls, South Dakota 57105

Attention: Chris Eng, Esq.

Telecopier No. (605) 362-9388

or to such other address with respect to which notice is subsequently provided in the manner set
forth above; and

     If to a Guarantor, to the address set forth on Exhibit A hereto, or to such other
address with respect to which notice is subsequently provided in the manner set forth above.

     11. Applicable Law. This Guarantee shall be governed by, interpreted under and
construed in accordance with the laws of the State of Delaware without reference to its choice of
law provisions.

     12. Consent to Jurisdiction; Enforceability

          (a) This Guarantee and the duties and obligations of the parties hereto shall be enforceable
against each Guarantor in the courts of the State of South Dakota. For such purpose, each
Guarantor hereby irrevocably submits to the nonexclusive jurisdiction of such courts and agrees
that all claims in respect of this Guarantee may be heard and determined in any of such courts.

          (b) Each Guarantor hereby irrevocably agrees that a final judgment of any of the courts
specified above in any action or proceeding relating to this Guarantee shall be conclusive and may
be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.

     13. Condition of Borrower. Each Guarantor is fully aware of the financial condition
of the Borrower and is executing and delivering this Guarantee based solely upon its own
independent investigation of all matters pertinent hereto and is not relying in any manner upon any
representation or statement of the Lender or the Borrower. Each Guarantor represents and warrants
that it is in a position to obtain, and hereby assumes full responsibility for obtaining, any
additional information concerning the Borrower’s financial conditions and any other matter
pertinent hereto as it may desire, and it is not relying upon or expecting the Lender to furnish to
it any information now or hereafter in the Lender’s possession concerning the same. By executing
this Guarantee, each Guarantor knowingly accepts the full range of risks encompassed within a
contract of this type, which risks it acknowledges.

     14. Expenses. Each Guarantor agrees that, promptly after receiving Lender’s notice
therefor, such Guarantor shall reimburse Lender, subject to the limitation set forth in
subparagraph 1(e) and to the extent that such reimbursement is not made by Borrower, for all
reasonable expenses (including, without limitation, reasonable attorneys’ fees and

 

 

disbursements) incurred by Lender in connection with the collection of the Guaranteed
Obligations or any portion thereof or with the enforcement of this Guarantee.

 

 

     IN WITNESS WHEREOF, the undersigned Guarantors set forth on Exhibit A hereto have
executed this Guarantee as of the date first set forth above.

	 	 	 	 	 
	 	GUARANTORS SET FORTH ON
EXHIBIT A HERETO:

 	 
	 	By:  	 	 
	 	 	 	 
	 
	 	By:  	 	 
	 	 	 	 
	 
	 	By:  	 	 
	 	 	 	 
	 
	 	By:  	 	 
	 	 	 	 
	 
	 	By:  	 	 
	 	 	 	 
	 

 

 

Exhibit A to Guarantee

	 	 	 	 	 
	Name and Address of Partner Guarantors	 	Guaranteed Amount
	 
	 	 	 	 
	Guarantors, as a group
	 	$	 	 

	 	 	 	 	 
	 	 	Individual
	 	 	Guarantee
	Individual Guarantors:	 	Percentage
	 
	 	 	 	 
	 
	 	 	 	 

 

 

Exhibit B to Guarantee

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Date of and	 	 	 	 
	 	 	 	 	 	 	Principal Amount	 	Debt Balance as of	 	Guaranteed
	Name of Lender	 	Name of Borrower	 	of Loan	 	__/__/__	 	Amount
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

 

Exhibit C to Guarantee

Copy of Note

 

 

Exhibit D to Guarantee

Identification of Deed of Trust and

Brief Summary Description of Collateral

 

15

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