Document:

Exhibit 10.8

 Exhibit 10.8 
 MANAGEMENT AGREEMENT 
 between 
 and 
 CRESTLINE HOTELS & RESORTS, INC. 
 (“Management Company”) 

 TABLE OF CONTENTS 
  

			
	 	  	Page
	 ARTICLE I – APPOINTMENT OF MANAGEMENT COMPANY
	  	
		
	 1.01 Appointment
	  	1
	 1.02 Delegation of Authority
	  	2
	 1.03 No Covenants or Restrictions
	  	2
	 1.04 Representations of Management Company
	  	2
		
	 ARTICLE II – DEFINITION OF TERMS
	  	3
		
	 ARTICLE III – THE HOTEL
	  	
		
	 3.01 Ownership
	  	13
	 3.02 Subordination of Management Agreement
	  	13
	 3.03 Non-Disturbance Agreement
	  	13
		
	 ARTICLE IV – PRE-OPENING
	  	14
		
	 ARTICLE V – TERM
	  	
		
	 5.01 Term
	  	15
	 5.02 Actions to be Taken upon Termination
	  	15
		
	 ARTICLE VI – COMPENSATION OF MANAGEMENT COMPANY
	  	
		
	 6.01 Management Fees
	  	17
	 6.02 Accounting and Interim Payment
	  	17
	 6.03 Reimbursements to Management Company
	  	18
	 6.04 Performance Termination
	  	18
		
	 ARTICLE VII – WORKING CAPITAL AND FIXED ASSET SUPPLIES
	  	
		
	 7.01 Working Capital and Inventories
	  	19
	 7.02 Fixed Asset Supplies
	  	19

  

 i 

			
	 ARTICLE VIII – MAINTENANCE, REPLACEMENT AND CHANGES
	  	
		
	 8.01 Routine Repairs and Maintenance
	  	19
	 8.02 Repairs and Equipment Reserve
	  	20
	 8.03 Building Alterations, Improvements, Renewals and Replacements
	  	21
	 8.04 Liens
	  	22
	 8.05 Ownership of Replacements
	  	22
		
	 ARTICLE IX – BOOKKEEPING AND BANK ACCOUNTS
	  	
		
	 9.01 Books and Records
	  	22
	 9.02 Hotel Accounts: Expenditures
	  	23
	 9.03 Annual Operating Projection
	  	23
	 9.04 Operating Deficits
	  	25
		
	 ARTICLE X – FRANCHISE AGREEMENT
	  	25
		
	 ARTICLE XI – POSSESSION AND USE OF HOTEL
	  	
		
	 11.01 Use
	  	26
	 11.02 Owner’s Right to Inspect
	  	26
	 11.03 Group Services
	  	26
		
	 ARTICLE XII – INSURANCE
	  	
		
	 12.01 Property and Operational Insurance
	  	27
	 12.02 General Insurance Provisions
	  	29
	 12.03 Coverage
	  	29
	 12.04 Cost and Expense
	  	30
	 12.05 Policies and Endorsements
	  	30
	 12.06 Indemnification
	  	30
		
	 ARTICLE XIII – REAL ESTATE AND PROPERTY TAXES
	  	
		
	 13.01 Impositions
	  	31
	 13.02 Owner’s Responsibility
	  	32

  

 ii 

			
	 ARTICLE XIV – HOTEL EMPLOYEES
	  	
	 14.01 Employees
	  	33
	 14.02 Termination
	  	34
	 14.03 Employee Claims
	  	34
		
	 ARTICLE XV – DAMAGE AND CONDEMNATION
	  	
		
	 15.01 Damage and Repair
	  	35
	 15.02 Condemnation
	  	35
		
	 ARTICLE XVI – DEFAULTS
	  	
		
	 16.01 Default
	  	36
	 16.02 Event of Default
	  	37
	 16.03 Remedies upon Event of Default
	  	37
		
	 ARTICLE XVII – PROPRIETARY MARKS; INTELLECTUAL PROPERTY
	  	
		
	 17.01 Proprietary Marks
	  	38
	 17.02 Computer Software and Equipment
	  	38
	 17.03 Intellectual Property
	  	39
		
	 ARTICLE XVIII – WAIVER AND INVALIDITY
	  	
		
	 18.01 Waiver
	  	40
	 18.02 Partial Invalidity
	  	40
		
	 ARTICLE XIX – ASSIGNMENT
	  	
		
	 19.01 Assignment by Management Company and Owner
	  	40
		
	 ARTICLE XX – TERMINATION OF AGREEMENT UPON SALE, DEMOLITION, OR FORECLOSURE
	  	
		
	 20.01 Sale of the Hotel
	  	41
	 20.02 Termination upon Demolition or Foreclosure
	  	42
		
	 ARTICLE XXI – MANAGEMENT COMPANY CONDITIONS
	  	
		
	 21.01 Conditions upon Management Company’s Obligations
	  	43

  

 iii 

			
	 ARTICLE XXII – MISCELLANEOUS
	  	
		
	 22.01 Right to Make Agreement
	  	43
	 22.02 Agency
	  	43
	 22.03 Failure to Perform
	  	44
	 22.04 Breach of Covenant
	  	45
	 22.05 Consents
	  	45
	 22.06 Applicable Law
	  	45
	 22.07 Headings
	  	45
	 22.08 Notices
	  	45
	 22.09 Environmental Matters
	  	46
	 22.10 Equity and Debt Offerings
	  	47
	 22.11 Franchise Agreement
	  	48
	 22.12 Estoppel Certificates
	  	48
	 22.13 Entire Agreement
	  	48

  

 iv 

 MANAGEMENT AGREEMENT 
 This Management Agreement (“Agreement”) is made effective as of the                      day
of                         , 200     (“Effective Date”) by and between
                                        
     a
                                        
        , with its principal place of business at
                                        
                                        
     (“Owner”), and Crestline Hotels & Resorts, Inc., a Delaware corporation, with its principal place of business at 8405 Greensboro Drive, Suite 500, McLean, Virginia 22102 (“Management
Company”). 
 WITNESSETH: 
 WHEREAS, Owner owns [fee simple/leasehold] title of the
                                        
             (“Hotel”) which is located on that certain real property as described on Exhibit A attached hereto and made a part hereof; and 
 WHEREAS, Owner desires to have Management Company manage and operate the Hotel from and after the Management Commencement Date (as defined in Article
II), and Management Company is willing to perform such services for the account of Owner on the terms and conditions set forth in this Agreement; 
 NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by each of the parties, the parties hereto
agree as follows: 
 ARTICLE I 
 APPOINTMENT OF MANAGEMENT COMPANY 

	1.01	Appointment 

 Owner hereby appoints and employs
Management Company as Owner’s exclusive agent to supervise, direct and control management and operation of the Hotel for the term provided in Article V. Management Company accepts said appointment and agrees to manage the Hotel during the Term
of this Agreement in accordance with the terms and conditions hereinafter set forth. The performance of all activities by Management Company, including the maintenance of all bank accounts, shall be as the agent of and for the account of Owner.

  

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 1.02 Delegation of Authority 
 Except as otherwise specifically provided in this Agreement, the Hotel shall be operated under the exclusive supervision and control of Management Company, which shall be responsible for the proper and efficient
operation of the Hotel. Except as otherwise specifically provided in this Agreement, Management Company shall have discretion and control, free from interference, interruption or disturbance, in all matters relating to the management and operation
of the Hotel, including, without limitation, charges for rooms and commercial space, credit policies, food and beverage services, granting of concessions or leasing of shops and agencies within the Hotel, receipt, holding and disbursement of funds,
maintenance of bank accounts (including Working Capital), procurement of inventories, supplies and services, promotion and publicity and, generally, all activities necessary for the operation of the Hotel. 
 1.03 No Covenants or Restrictions 
 Owner warrants
that there will be on the Management Commencement Date no covenants or restrictions which would prohibit or limit Management Company from operating the Hotel, including cocktail lounges, restaurants and other facilities customarily a part of or
related to a first-class hotel facility. Owner agrees upon request by Management Company to sign promptly and without charge applications for licenses, permits or other instruments necessary for operation of the Hotel. 
 1.04 Representations of Management Company 
 Management Company represents that it is experienced and capable in the planning, decorating, furnishing, equipping, promoting, managing, and operating of first-class hotels, and Management Company covenants and agrees to manage and operate
the Hotel as a first-class hotel in accordance with the standards of similarly situated first-class hotels in comparable markets and in strict compliance with that certain Franchise Agreement dated
                    , 200    
between                                       
                 , as the “Franchisor,”
and                                       
         , as the “Franchisee” (as such agreement may have been or may be amended subject to Article X below, the “Franchise Agreement”), respecting the Hotel. Management
Company further represents that it qualifies as an “eligible independent contractor” as defined in Section 856(d)(9) of the Internal Revenue Code of 1986, as amended (the “Code”). 
  

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 ARTICLE II 
 DEFINITION OF TERMS 
 The following terms when used in this Agreement shall have the
meanings indicated: 
 Accounting Period means a calendar month. 
 Additional Invested Capital means the cumulative total, as of any given date during the Term of this Agreement, of: (i) any expenditures made
by Owner pursuant to Section 8.03, plus (ii) any contributions by Owner to the Reserve beyond the funding described in Section 8.02 A, other than those contributions which are treated as Deductions or reimbursed to Owner under
Section 8.02 E, plus (iii) any advances of Working Capital made by Owner pursuant to Section 7.01 (including any advances by Owner for the payment of Impositions under Section 13.01) from its own funds, so long as any such
advance is not made as a result of an Operating Loss (described in Section 9.04), and further provided that any subsequent reimbursement of Working Capital to Owner (including any reimbursement of payments made by Owner for Impositions) shall
reduce the amount of Additional Invested Capital by the same amount of any such reimbursement, plus (iv) any rental payments pursuant to any capital leases approved by Management Company and Owner that are not otherwise paid from the Reserve or
treated as a Deduction under the terms of this Agreement, plus (v) special assessments paid by Owner pursuant to clause (2) of Section 13.02. 
 Affiliate means any individual or entity, directly or indirectly through one or more intermediaries, controlling, controlled by, or under common control with a party. The term “control,” as used in
the immediately preceding sentence, means, with respect to a corporation, the right to exercise, directly or indirectly, fifty point one percent (50.1%) or more of the voting rights attributable to the shares of the controlled corporation, and,
with respect to an entity that is not a corporation, the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of the controlled entity. 
 Agreement shall have the meaning set forth in the Preamble. 
 Annual Operating Projection shall have the meaning set forth in Section 9.03. 
 Annual
Operating Statement shall have the meaning set forth in Section 9.01. 
 Base Management Fee shall have the meaning set forth
in Section 6.01 A. 
 Building Estimate shall have the meaning set forth in Section 8.03 A. 
 Code shall have the meaning set forth in Section 1.04. 
 Consumer Price Index shall mean the Consumer Price Index for All Urban Consumers (CPI-U) (U.S. City Average), as published by the Bureau of Labor Statistics, 
  

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 Department of Labor, or if such index is no longer published, the “Consumer Price Index” shall then refer to
such comparable statistics on changes in the cost of living for urban consumers as such may be computed and published by an agency of the United States or by a responsible financial periodical of recognized authority as mutually agreed upon by the
parties. 
 Deductions shall have the meaning set forth in the definition of “Operating Profit.” 
 Default shall have the meaning set forth in Section 16.01. 
 Effective Date shall have the meaning set forth in the Preamble. 
 Employee Claims means any
and all claims (including all fines, judgments, penalties, costs, litigation and/or arbitration expenses, attorneys’ fees and expenses, and costs of settlement with respect to any such claims) by any employee or employees of Management Company
against Owner or Management Company with respect to the employment at the Hotel of such employee or employees. “Employee Claims” shall include, without limitation, the following: (i) claims which are eventually resolved by
arbitration, by litigation or by settlement; (ii) claims which also involve allegations that any applicable employment-related contracts affecting the employees at the Hotel, including collective bargaining agreements, if any, have been
breached; and (iii) claims which involve allegations that one or more state or federal employment laws have been violated. 
 Event
of Default shall have the meaning set forth in Section 16.02. 
 Executive Employees shall have the meaning set forth in
Section 14.02. 
 Existing Twelve Month Management Fees shall have the meaning set forth in the definition of “Sale
Termination Fee.” 
 FF&E shall have the meaning set forth in Section 8.01. 
 FF&E Estimate shall have the meaning set forth in Section 8.02 C. 
 Fiscal Year means the calendar year, beginning at 12:01 a.m. on January 1 and ending at midnight on December 31. The partial Fiscal Year
between the Management Commencement Date and the first full Fiscal Year shall be deemed part of the first full Fiscal Year. The partial Fiscal Year between the end of the last full Fiscal Year and the Termination of this Agreement shall, for
purposes of this Agreement, constitute a separate Fiscal Year. 
 Fixed Asset Supplies means supply items included within Property and
Equipment under the Uniform System of Accounts, including linen, china, glassware, silver, uniforms and similar items. 
  

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 Force Majeure means acts of God, acts of war, civil disturbance, governmental action (including
the revocation or refusal to grant licenses or permits, where revocation or refusal is not due to the fault of Management Company, its agents or employees), strikes, fire, unavoidable casualties or any other causes beyond the reasonable control of
Management Company, including without limitation, any failed duty of Management Company which is in part due to Owner’s failure to fund Owner-Funded Capital Expenditures pursuant to Section 8.03 of this Agreement. Force Majeure shall
exclude general economic and/or market factors. 
 Franchise Agreement shall have the meaning set forth in Section 1.04.

 Franchisee shall have the meaning set forth in Section 1.04. 
 Franchisor shall have the meaning set forth in Section 1.04. 
 GAAP means generally accepted accounting principles consistently applied throughout the specified period(s). 
 Gross Revenues means all revenues and receipts of every kind derived from operating the Hotel and parts thereof, including, but not limited to: income (from both cash and credit transactions), before commissions but after discounts
for prompt or cash payments, from rental of rooms, stores, offices, meeting, exhibit or sales space of every kind; license, lease and concession fees and rentals (not including gross receipts of licensees, lessees and concessionaires from their
operations); income from vending machines; health club membership fees; food and beverage sales; wholesale and retail sales of merchandise; service charges, and proceeds, if any, from business interruption or other loss of income insurance. Gross
Revenues shall not include (i) gratuities, including tips, paid to Hotel employees by third parties; (ii) federal, state, and municipal excise, sales, and use taxes or similar impositions collected directly from patrons or guests or
included as part of the sales price of any rooms, goods, or services; (iii) proceeds realized from the sale of FF&E no longer necessary to the operation of the Hotel, which shall be deposited in the Reserve; (iv) proceeds of any
insurance other than business interruption insurance (or other insurance against loss of income) of the type described in Section 12.01 A4; (v) condemnation awards; (vi) gross receipts received by lessees, licensees, or
concessionaires of the Hotel; (vii) proceeds from any financing or refinancing; (viii) proceeds of any judgment or settlement not received as compensation for actual or potential loss of Gross Revenues or Operating Profit;
(ix) interest earned on the Reserve or on any other funds held in the Hotel bank accounts, which shall be deposited in the respective Reserve or bank account; and (x) any funds supplied by Owner to the Reserve or to meet Working Capital
needs. 
 Group Services shall have the meaning set forth in Section 11.03. 
 Highland means Highland Hospitality Corporation, a Maryland corporation and the ultimate parent company of Owner. 
  

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 Hotel means the
                                        
     located at
                                        
    . 
 Impositions shall have the meaning set forth in Section 13.01. 
 Incentive Fee shall have the meaning set forth in Section 6.01 B. 
 Intellectual Property shall have the meaning set forth in Section 17.03. 
 Inventories means Inventories as defined in the Uniform System of Accounts, such as provisions in storerooms, refrigerators, pantries and
kitchens; beverages in wine cellars and bars; other merchandise intended for sale; fuel; mechanical supplies; stationery; and other expenses, supplies and similar items. 
 Management Commencement Date means the date upon which Management Company shall commence operating the Hotel pursuant to this Agreement which date shall be confirmed in writing by Owner and Management Company.

 Management Company means Crestline Hotels & Resorts, Inc. 
 Mortgage means any security instrument which encumbers the Hotel and/or the Hotel premises, including, without limitation, mortgages, deeds of
trust, security deeds and similar instruments. 
 Non-Disturbance Agreement means an agreement, in recordable form in the jurisdiction
in which the Hotel is located, executed and delivered by a holder of a Secured Loan (which agreement shall by its terms be binding upon all assignees of such holder and upon any individual or entity that acquires title to or possession of the Hotel
at or through a foreclosure (referred to as a “Subsequent Owner”)), for the benefit of Management Company, pursuant to which, in the event such holder (or its assignee) or any Subsequent Owner comes into possession of or acquires title to
the Hotel either at or following a foreclosure, such holder (and its assignees) and all Subsequent Owners shall: (x) recognize Management Company’s rights under this Agreement, (y) not name Management Company as a party in any
foreclosure action or proceeding, and (z) not disturb Management Company in its right to continue to manage the Hotel pursuant to this Agreement; provided, however, that at such time, (i) this Agreement has not expired or otherwise been
terminated earlier in accordance with its terms, and (ii) there are no outstanding Events of Default by Management Company, and (iii) no material event has occurred and no material condition exists which, after notice or the passage of
time or both, would entitle Owner to terminate this Agreement (excluding events which would constitute Events of Default, which are to be governed exclusively by clause (ii) hereof). 
 Operating Loss means a negative Operating Profit. 
 Operating Profit means the excess of Gross Revenues over the following deductions (“Deductions”) incurred by Management Company in operating the Hotel: 
 1. Cost of sales, salaries, wages, fringe benefits, payroll taxes and other cash payroll costs related to Hotel employees; 
  

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 2. Departmental expenses, administrative and general expenses and the cost of Hotel advertising and
business promotion, heat, light and power, and routine repairs, maintenance and minor alterations treated as Deductions under Section 8.01; 
 3. The cost of Inventories and Fixed Asset Supplies consumed in the operation of the Hotel; 
 4. A reasonable reserve for
uncollectible accounts receivable as determined by Management Company and approved by Owner; 
 5. All costs and fees of independent
professionals or other third parties who perform services required or permitted hereunder if and to the extent such cost and expense are not capitalized in accordance with GAAP, including without limitation, third parties providing legal services to
Management Company in connection with matters involving the Hotel (excluding matters in dispute between Owner and Management Company), which rates shall not exceed rates billed by such independent professionals or other third parties; 
 6. The cost and expense of technical consultants and operational experts for specialized services in connection with non-routine Hotel work; provided
that Owner shall have the right to approve any such technical consultant or operational expert if its cost or expense is expected to exceed $25,000.00 in the aggregate for any Fiscal Year and is not included in the approved Annual Operating
Projection for such Fiscal Year; 
 7. Management Company’s Base Management Fee (referred to in Section 6.01) for services rendered
in connection with the operation of the Hotel; 
 8. All the costs and expenses incurred by Management Company pursuant to the Franchise
Agreement including, but not limited to, franchise fees, advertising, chain services, insurance, etc.; provided, however, any initial licensing fees or capital expenditures necessary for compliance with the Franchise Agreement shall not be a
Deduction from Gross Revenues for purposes of the calculation of Operating Profit; 
 9. The amount to be credited to the Reserve described
in Section 8.02; 
 10. Insurance costs and expenses as described in Article XII; 
 11. Taxes, if any, payable by or assessed against Management Company related to this Agreement or to Management Company’s operation of the Hotel
(exclusive of Management Company’s income taxes) and Impositions, including without limitation, real and personal property taxes assessed against the Hotel along with related expenses incurred in connection with all such assessments; provided
that any fines, penalties or interest added thereto which are a direct result of Management Company’s gross negligence or willful misconduct shall be paid by Management Company from its own funds and shall not be treated as Deductions;

  

 -7- 

 12. All costs and expenses incurred in order to obtain and keep in full force and effect any licenses and
permits required for the operation of the Hotel and related facilities, including without limitation, liquor licenses for the sale of alcoholic beverages at all restaurants, bars, lounges, banquet rooms, meeting rooms and guest rooms at the Hotel;
provided that any fines or penalties relating to maintaining such licenses and permits which are the direct result of either Management Company’s or Owner’s gross negligence or willful misconduct shall be paid by such party from its own
funds and shall not be treated as Deductions; and 
 13. Such other costs and expenses incurred by Management Company as are specifically
provided for elsewhere in this Agreement (including, without limitation, Group Services and certain reimbursable expenses of Management Company’s corporate staff described in Section 6.03) or are otherwise reasonably necessary for the
proper and efficient operation of the Hotel, unless any such costs and expenses are specifically stated not to be Deductions under any provision of this Agreement. 
 The term “Deductions” shall not include (i) debt service payments pursuant to any Secured Loan; nor (ii) ground lease rental or other rental payments pursuant to any ground lease in connection with
the Hotel, including without limitation, payment of rents and other sums made by Owner under the Lease Agreement; nor (iii) any expenditures by Owner in the acquisition or conversion of the Hotel; nor (iv) rental payments pursuant to any
capital lease approved by Management Company; nor (v) the cost of external (third party) audits of Hotel operations and/or with respect to the Owner entity itself; nor (vi) other recurring and non-recurring ownership costs, such as
Owner’s entity administration and servicing costs; all of which shall be paid by Owner from its own funds, and not from Gross Revenues nor from the Reserve. 
 Owner means
                                        
                                    . 
 Owner-Funded Capital Expenditures shall have the meaning set forth in Section 8.03. 
 Owner’s Investment means the sum of
(i) $                         [the price paid by Highland and/or Owner to acquire the Hotel, including closing
costs and conversion costs and pre-opening expenses and fees], plus (ii) Additional Invested Capital, plus (iii) the initial Working Capital amount deposited by Owner pursuant to Section 7.01 A. 
 Owner’s Priority means, with respect to each Fiscal Year during the Term hereof (prorated for any partial Fiscal Year), an amount equal to
eleven percent (11.0%) of Owner’s Investment. 
 Prime Rate means the “prime rate” as published in the “Money
Rates” section of The Wall Street Journal; however, if such rate is, at any time during the Term of this 
  

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 Agreement, no longer so published, the term “Prime Rate” shall mean the average of the prime interest rates
which are announced, from time to time, by the three (3) largest banks (by assets) headquartered in the United States which publish a “prime rate.” 
 Profit Minimum shall have the meaning set forth in Section 6.04. 
 Proprietary Marks
shall have the meaning set forth in Section 17.01. 
 Prospectus shall have the meaning set forth in Section 22.10.

 Qualified Lender means any lender, such as any federally insured commercial or savings bank, national banking association, savings
and loan association, investment banking firm, commercial finance company, trust for securitized loans and other similar lending institution that is a holder of a Secured Loan that is a Qualified Loan. 
 Qualified Loan means any Secured Loan in which the initial principal amount, as of the date such Secured Loan is incurred, when added to the
current principal balance of all existing Secured Loans as of that date, is less than or equal to the greater of the following: 
  

	 	(i)	Seventy percent (70%) of the sum of:
(a) $                         [the price paid by Owner to acquire the Hotel, including closing costs and
conversion costs and pre-opening expenses and fees], plus (b) Additional Invested Capital; or 

  

	 	(ii)	Seventy percent (70%) of the fair market value of the Hotel as reasonably determined by Highland’s board of directors; or 

  

	 	(iii)	The existing balance of any Secured Loans encumbering the Hotel immediately prior to the date of the incurrence of such Qualified Loan, plus commercially reasonable transaction
costs (defined as all normal transaction costs to the extent actually incurred) associated with such refinancing up to an amount equal to four percent (4%) of the principal amount of such Qualified Loan. 

 In addition, regardless of whether or not the above tests set forth in clauses (i), (ii) and (iii) above are satisfied, (a) the existing
(as of the Management Commencement Date) balance of any Secured Loan which is secured by a Mortgage existing as of the Management Commencement Date shall be deemed to be a “Qualified Loan”; and (b) any Secured Loan which Management
Company, in its reasonable discretion, has approved in writing shall be deemed to be a “Qualified Loan” (provided that an approval by Management Company that a given Secured Loan shall be deemed to be a Qualified Loan hereunder shall apply
only to the specific hotel or hotels which are described in such approval, and shall not be deemed to be an approval with respect to other hotels, regardless of whether such Secured Loan by its terms permits the substitution or addition of such
other hotels as security for such Secured Loan). 
  

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 Related Person shall have the meaning set forth in Section 22.02 A. 
 Reserve shall have the meaning set forth in Section 8.02 A. 
 Sale of the Hotel means any sale, assignment, transfer or other disposition, for value or otherwise, voluntary or involuntary, of Owner’s title to the Hotel or the site (either fee or leasehold title, as
the case may be), but shall not include a collateral assignment intended to provide security for a loan. For purposes of this Agreement, a “Sale of the Hotel” shall also include a lease (or sublease) of the entire Hotel or site. The phrase
“Sale of the Hotel” shall also include any sale, transfer, or other disposition, for value or otherwise, in a single transaction or a series of related transactions, of the controlling interest in the Owner or Highland. If the Owner or
Highland, as the case may be, is a corporation, the phrase “controlling interest” shall mean the right to exercise, directly or indirectly, fifty percent (50%) or more of the voting rights attributable to the shares of Owner (through
ownership of such shares or by contract); provided, however, that in no event shall the transfer of “controlling interest” refer to the acquisition of shares in a publicly traded corporation by passive investors that have no control or
influence over the business decisions concerning the corporation. If Owner is not a corporation, the phrase “controlling interest’ shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the
management or policies of Owner. Notwithstanding the foregoing, the term “Sale of the Hotel” shall not include any sale, assignment, transfer or other disposition of the Hotel or the site by Owner to an Affiliate of Owner. 
 Sale Termination Fee means that amount payable by Owner to Management Company pursuant to Section 20.01 D of this Agreement, which is equal
to the following: 
 [to be inserted if the Hotel was open and operating prior to the Management Commencement Date: (a) for the Sale of the
Hotel at any time during the first or second full Fiscal Year after the Management Commencement Date, the product of five and one-half (5.5) times the sum of the aggregate Base Management Fees and Incentive Fees earned by Management
Company during the most recent twelve (12) month period immediately preceding the Sale of the Hotel (such period is referred to as the “Test Period” and the collective management fees earned during the Test Period are referred as the
“Existing Twelve Month Management Fees”); provided, that, if any portion of the Test Period relates to operations of the Hotel occurring prior to the Management Commencement Date (the “Prior Period”), the financial operating
results from the Prior Period shall be used as necessary to calculate what Management Company’s Existing Twelve Month Management Fees would have been during any such Prior Period occurring in the Test Period for the purpose of calculating the
Sale Termination Fee;] 
 [to be inserted if the Hotel was not open or operating prior to the Management Commencement Date:
(a) for the Sale of the Hotel at any time during the first or second full Fiscal Year after the Management Commencement Date, the product of five and one-half (5.5) times the sum of the aggregate Base Management Fees and Incentive
Fees projected for the most recent twelve (12) month period immediately preceding the Sale of the Hotel (such period is referred to as the “Test Period” and the collective management 
  

 -10- 

 fees projected under this clause (a) or earned under clauses (b) through (f) below during the Test Period
are referred as the “Existing Twelve Month Management Fees”) as set forth in the pro forma attached hereto as Exhibit B;] 
 (b) for the Sale of the Hotel at any time during the third, fourth or fifth full Fiscal Year after the Management Commencement Date, the product of three (3.0) times Existing Twelve Month Management Fees; 
 (c) for the Sale of the Hotel at any time during the sixth (6th) full Fiscal Year after the Management Commencement Date, the product of two (2.0) times the Existing Twelve Month Management Fees; 
 (d) for the Sale of the Hotel at any time during the seventh (7th) full Fiscal Year after the Management Commencement Date, the product of one and one-half (1.5) times the Existing Twelve Month Management Fees; 
 (e) for the Sale of the Hotel at any time during the eighth (8th) full Fiscal Year after the Management Commencement Date, the product of one (1.0) times the Existing Twelve Month Management Fees; or 
 (f) for the Sale of the Hotel at any time during the ninth (9th) full Fiscal Year after the Management Commencement Date and thereafter, there shall be no Sale Termination Fee. 
 Secured Loan means and includes (i) any indebtedness secured by a Mortgage; and (ii) all amendments, modifications, supplements and extensions of any such Mortgage. 
 Software shall have the meaning set forth in Section 17.02. 
 Term shall have the meaning set forth in Section 5.01. 
 Termination means the expiration or
sooner cessation of this Agreement. 
 Uniform System of Accounts means the Uniform System of Accounts for Hotels, Ninth Revised
Edition, 1996, as revised and adopted by the Hotel Association of New York City, Inc. from time to time and as modified by applicable provisions of this Agreement. 
 Unrelated Persons shall have the meaning set forth in Section 22.02 A. 
 WARN Act shall
have the meaning set forth in Section 14.02. 
 Working Capital means funds which are reasonably necessary for the day-to-day
operation of the Hotel’s business, including, without limitation, amounts sufficient for the maintenance of change and petty cash funds, operating bank accounts, receivables, payrolls, prepaid expenses and funds required to maintain
Inventories, less accounts payable and accrued current liabilities. 
  

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 [End of Article II] 
  

 -12- 

 ARTICLE III 
 THE HOTEL 
 3.01 Ownership 
 During the Term of this Agreement, Owner shall take all commercially reasonable action as is appropriate to assure that Owner has leasehold title to the land described in Exhibit A and all improvements thereon, free
and clear of all liens and encumbrances other than: 
  

	 	(i)	Easements or other encumbrances that do not adversely affect the operation of the Hotel by Management Company and do not require the payment of any money; 

 

	 	(ii)	Mortgages which are given to secure any one or more Qualified Loans; 

  

	 	(iii)	Liens for taxes, assessments, levies or other public charges which are not yet due or are being contested in good faith; 

  

	 	(iv)	Amendments or modifications to the to the ground lease, if any, existing as of the Effective Date, including without limitation, the Lease Agreement; provided, however, Owner shall
obtain Management Company’s prior written consent prior to entering into any such amendment or modification that would (i) materially adversely affect the rights and/or obligations of Management Company, and/or (ii) have an adverse
impact on the amount of the fees to be paid to Management Company under this Agreement; and 

  

	 	(v)	All other matters or record affecting title as of the Effective Date. 

 It
is acknowledged that Owner does not own fee title to the land described in Exhibit A and, therefore, cannot make any representations or covenants with respect to the actions or inactions of the fee owner. However, Owner does agree that it shall
(a) by its own action or inaction not do anything in violation of the provisions of this Section 3.01, and (b) use commercially reasonable efforts to assure that the fee owner does not enter into any agreements or take any action in
violation of the provisions of this Section 3.01. 
 3.02. Subordination of Management Agreement 
 Excluding Management Company’s right to receive (i) payment of the Base Management Fee, and (ii) reimbursement of expenses actually
incurred by Management Company in the performance of its obligations hereunder pursuant to the approved Annual Operating Projection, this Agreement and all of the rights and benefits of Management Company hereunder are, and shall be subject and
subordinate to any Qualified Loan(s) which now or hereafter encumber the Hotel. This subordination provision shall be self-operative and no other or further instrument of subordination shall be required. Management Company agrees, however, upon
request of any Qualified Lender, duly to execute and deliver any subordination agreement requested by such Qualified Lender to evidence and confirm the subordination effected under this Section 3.02. 
  

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 3.03 Non-Disturbance Agreement 
 Notwithstanding Section 3.02, Owner agrees that, prior to obtaining any Qualified Loan, it will use commercially reasonable good faith efforts to obtain from each prospective holder or holders thereof a
Non-Disturbance Agreement pursuant to which Management Company’s rights under this Agreement will not be disturbed as a result of a loan default stemming from non-monetary factors which (i) relate to Owner and do not relate solely to the
Hotel, and (ii) are not Defaults by Management Company under Article XVI of this Agreement. If Owner desires to obtain a Qualified Loan, Management Company, on written request from Owner, shall promptly identify those provisions in the proposed
loan documents which fall within the categories described in clauses (i) and (ii) above, and Management Company shall otherwise assist in expediting the preparation of an agreement between the prospective holder and Management Company
which will implement the provisions of this Section 3.03. 
 ARTICLE IV 
 PRE-OPENING 
 4.01 Pre-Opening Expenses 
 Owner shall provide all funds to pay any amounts or, as applicable, reimburse any deficiencies arising in connection with the following pre-opening
expenses in accordance with a pre-opening budget prepared by Management Company and approved by Owner prior to the opening of the Hotel: 
  

	 	(i)	payment of any application and/or other fees and expenses due in connection with obtaining the Franchise; 

  

	 	(ii)	payment of all expenses (including, without limitation, any and all legal expenses) related to or arising in connection with obtaining the permits and/or licenses necessary for the
operation of the Hotel or any facilities located therein, including, without limitation, any liquor licenses; 

  

	 	(iii)	payment of expenses for operating equipment and operating supplies which may be required as of the Hotel’s opening date; and 

  

	 	(iv)	any other expenses incurred by Owner or Management Company, as the case may be, in connection with the opening of the Hotel. 

 Owner shall advance to Management Company all funds required by Management Company for such pre-opening expenses (not to exceed amounts specified in a
pre-opening budget approved by Owner) and on the dates as may be specified by Management Company in a “Request for Funds” to be submitted by Management 
  

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 Company to Owner. Such amounts shall be provided by Owner within fifteen (15) days of Owner’s receipt of
Management Company’s Request for Funds. If following the Management Commencement Date, funds for pre-opening expenses are owing to Management Company, Management Company shall have the option to deduct such amounts from Owner’s share of
Operating Profit. It is understood that, to the extent any delay or postponement of the Management Commencement Date causes increased pre-opening expenses that cannot reasonably be avoided, Owner shall be responsible for and promptly pay such
increased pre-opening expenses. No item which is or should have been included as a pre-opening expense shall be charged as a Deduction. 
 4.02
Pre-Opening Fee [To be inserted for new development projects only] 
 In addition to payment of the
pre-opening expenses described in Section 4.01 above, Owner shall pay to Management Company a pre-opening fee for services rendered pursuant to Section 4.01 in the amount of
                             Dollars
($                    ), which shall be paid to Management Company in
             (      ) equal monthly installments on the first day of each month commencing in the
             (      ) month prior to the targeted Management Commencement Date of
                    , 200    . In the event the targeted Management Commencement Date is delayed or postponed and
such delay is not caused directly by the actions or inactions of Management Company, the pre-opening fee to be paid by Owner to Management Company shall be increased on a pro-rata per-diem basis of
                 Dollars ($                ) per day from the targeted
Management Commencement Date to the actual Management Commencement Date. 
 ARTICLE V 
 TERM 
 5.01 Term 
 This Agreement shall commence on the Effective Date, and, unless sooner terminated as provided in this Agreement, shall continue for a period ending one
hundred and twenty (120) Accounting Periods after the Management Commencement Date (the “Term”). 
 5.02 Actions to be Taken upon
Termination 
 Upon a Termination of this Agreement, the following shall be applicable: 
 A. Management Company shall, within sixty (60) days after Termination of this Agreement, prepare and deliver to Owner a final accounting statement
with respect to the Hotel, as more particularly described in Section 9.01, along with a statement of any sums due from Owner to Management Company pursuant hereto, dated as of the date of Termination. Within thirty (30) days after the
receipt by Owner of such final accounting statement, the parties will make whatever cash adjustments are necessary pursuant to such final statement. The cost of preparing such final accounting statement shall be a Deduction, unless the Termination
occurs as a result of an Event of Default by either party, 
  

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 in which case the defaulting party shall pay such cost. Management Company and Owner acknowledge that there may be
certain adjustments for which the necessary information will not be available at the time of such final accounting, and the parties agree to readjust such amounts and make the necessary cash adjustments when such information becomes available;
provided, however, that (unless there are ongoing disputes of which each party has received notice) all accounts shall be deemed final as of one hundred eighty (180) days after such Termination. 
 B. As of the date of the final accounting referred to in subsection A above, Management Company shall release and transfer to Owner any of Owner’s
funds which are held or controlled by Management Company with respect to the Hotel, with the exception of funds to be held in escrow pursuant to Section 12.04 B and Section 14.02. During the period between the date of Termination and the
date of such final accounting, Management Company shall pay (or reserve against) all Deductions which accrued (but were not paid) prior to the date of Termination, using for such purpose any Gross Revenues which accrued prior to the date of
Termination. 
 C. Management Company shall make available to Owner such books and records respecting the Hotel (including those from prior
years, subject to Management Company’s reasonable records retention policies) as will be needed by Owner to prepare the accounting statements, in accordance with the Uniform System of Accounts, for the Hotel for the year in which the
Termination occurs and for any subsequent year. Such books and records shall not include: (i) employee records which must remain confidential either under applicable laws or regulations of any governmental authority or agency having
jurisdiction over such matters or under reasonable corporate policies of Management Company; or (ii) any Intellectual Property. 
 D.
Management Company shall (to the extent permitted by law) assign to Owner, or to any other manager employed by Owner to operate and manage the Hotel, all operating licenses, including any liquor licenses, for the Hotel which have been issued in
Management Company’s name and in the event that such licenses are not assignable, Management Company shall cooperate with Owner and any new manager of the Hotel in connection with the issuance of new licenses; provided that if Management
Company has expended any of its own funds in the acquisition of any of such licenses, Owner shall reimburse Management Company therefor if it has not done so already. 
 E. Owner agrees that Hotel reservations and any and all contracts made in connection with Hotel convention, banquet or other group services made by Management Company in the ordinary and normal course of business, for
dates subsequent to the date of Termination and at rates prevailing for such reservations at the time they were made, shall be honored and remain in effect after Termination of this Agreement. 
 F. Various other actions shall be taken, as described in this Agreement, including, but not limited to, the actions described in Sections 12.04 B, 14.02,
17.01, 17.02, and 17.03. 
  

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 G. Management Company shall cooperate with the new operator of the Hotel as to effect a smooth transition
and shall peacefully vacate and surrender the Hotel to Owner. 
 The provisions of this Section 5.02 shall survive any Termination.

 ARTICLE VI 
 COMPENSATION OF MANAGEMENT COMPANY 
 6.01 Management Fees 
 A. Base Management Fees. In consideration of the services to be performed during the Term of this Agreement by Management Company, Management
Company shall be paid a periodic base management fee (“Base Management Fee”) in the amount of three percent (3%) of Gross Revenues for each Accounting Period. [In the event that there are 350 or more guest rooms in the Hotel,
the Base Management Fee shall be 2.5% of Gross Revenues.] Each such periodic fee shall be paid to Management Company (or retained by Management Company as provided below) at such time as the final monthly report for such Accounting Period is
submitted to Owner as provided in Section 6.02 A below. 
 B. Incentive Management Fees. In addition to the Base Management Fee
and in consideration of the services to be performed during the Term of this Agreement, Management Company shall be paid for each Fiscal Year (or partial Fiscal Year), subject to Section 6.02 B, an incentive fee (“Incentive Fee”)
equal to fifteen percent (15%) of the amount by which Operating Profit for such Fiscal Year (or partial Fiscal Year) minus the amount of any ground lease rentals or other rental payments pursuant to any ground lease in connection with
the Hotel (but not including rental payments made pursuant to the Lease Agreement) paid by Owner from its own funds (and not from Gross Revenues or the Reserve) during the same time period exceeds Owner’s Priority (prorated for any partial
Fiscal Year). Notwithstanding the foregoing to the contrary, Management Company shall not be entitled to receive any Incentive Fee in any Fiscal Year with respect to which the distributions to Owner have not equaled or exceeded Owner’s
Priority. 
 C. Total Fees Cap. Notwithstanding anything in this Agreement to the contrary, the total amount of Base Management Fees
plus Incentive Fees actually paid to Management Company during any Fiscal Year shall not exceed four and one-half percent (4.5%) of Gross Revenues (for purposes of this subsection C, referred to as the “Fee Cap”) for such
Fiscal Year (prorated for any partial Fiscal Year). The Fee Cap is not intended to limit or otherwise cap any other fees or amounts (other than the Base Management Fees and Incentive Fees as described in this subsection C) that may be paid to
Management Company under this Agreement unless such fees or amounts are specifically limited by the terms of this Agreement. 
 6.02 Accounting and
Interim Payment 
 A. Subject to Section 6.01 C above, within twenty (20) days after the close of each Accounting Period,
Management Company shall submit an accounting to Owner 
  

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 showing Gross Revenues, Deductions, Operating Profit, and distributions thereof for such Accounting Period. Management
Company shall transfer to Owner with each accounting any Operating Profit or other sums then available for distribution to Owner and shall retain any periodic Base and Incentive Management Fees due Management Company. Such interim accountings shall
be in the form of statements reasonably approved by Owner. 
 B. The calculation and payment of the management fees and the distribution of
Operating Profit made with respect to each Accounting Period within a Fiscal Year shall be accounted for cumulatively. Within sixty (60) days after the close of each Fiscal Year, Management Company shall submit an accounting, as more fully
described in Section 9.01 for such Fiscal Year to Owner, which accounting shall be controlling over the interim accountings. Any adjustments required for such Fiscal Year by such final accounting shall be made by the parties within forty-five
(45) days after receipt by Owner of such final accounting. 
 6.03 Reimbursements to Management Company 
 In addition to all other amounts for which Management Company is entitled to reimbursement from Owner pursuant to this Agreement, Owner agrees to
reimburse Management Company for all travel and out-of-pocket expenses (such as fax, postage, telephone and express mail) of the corporate staff (defined for purposes of this Section 6.03 as those employees who are not ordinarily located at the
Hotel) of Management Company and Management Company’s Affiliates, which are directly related to the services of such staff on behalf of the Hotel; provided, however, the reimbursements for such expenses shall be billed, as Deductions, to the
Hotel at cost (without duplication of those expenses included in Group Services) and such amounts are included in the Annual Operating Projection or otherwise approved by Owner. 
 6.04 Performance Termination 
 Owner shall have the option to terminate this Agreement if the Hotel:
(i) fails to achieve Operating Profit equal to ninety (90%) of the Operating Profit estimated in the approved Annual Operating Projection (the “Profit Minimum”) in each of two (2) consecutive Fiscal Years (excluding the
initial two full Fiscal Years after the Management Commencement Date), and (ii) fails to maintain one hundred percent (100%) of the fair market share of revenue per available room for the Hotel’s competitive set as set forth on
Exhibit C attached hereto during each of such two (2) consecutive Fiscal Years as reported by Smith Travel Research (or similar reporting service in the event that Smith Travel Research reports are no longer available), and (iii) the fact
that Management Company is failing to meet the tests set forth in (i) and (ii) above is not the result of Force Majeure; provided that Management Company and Owner shall mutually agree upon appropriate adjustments to the Hotel’s
competitive set as set forth on Exhibit C that may be necessary as a result of such Force Majeure for purposes of determining whether Management Company has failed the test set forth in (ii) above. Notwithstanding the foregoing, Management
Company shall have the right to cure any such failure to achieve Operating Profit equal to the Profit Minimum during any Fiscal Year by paying to Owner the difference between Operating Profit for such Fiscal Year and the Profit Minimum within sixty
(60) days after the end of such Fiscal Year. 
  

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 ARTICLE VII 
 WORKING CAPITAL AND FIXED ASSET SUPPLIES 
 7.01 Working Capital and Inventories 
 A. At the Management Commencement Date, Owner shall provide to Management Company the funds necessary to supply the Hotel with Working Capital and
Inventories in a minimum amount of One Thousand Dollars ($1,000.00) per guest room and shall at all times thereafter maintain in the Hotel’s operating accounts a minimum balance in the amount of
$                             (or, if necessary, such greater amount to assure the uninterrupted and
efficient operation of the Hotel, including, without limitation, sufficient funds to pay budgeted current liabilities as they fall due and to replace Inventories as they are consumed, as set forth in the approved Annual Operating Projection) in
accordance with the provisions of subsection B below. Working Capital so advanced shall remain the property of Owner throughout the Term of this Agreement, and Management Company shall make no claim thereto. 
 B. To the extent that the Working Capital becomes reduced to an amount less than
$                            , additional funds in a sum equal to the difference between
$                             and the then Working Capital shall be provided by Owner within five
(5) days after Management Company has given written notice to Owner of such reduction of Working Capital. 
 7.02 Fixed Asset Supplies

 Owner shall provide such funds as Management Company may reasonably determine to be necessary to supply the Hotel with Fixed Asset
Supplies. Fixed Asset Supplies shall at all times be owned by, and be the sole property of, Owner, and Management Company shall make no claim thereto. 
 ARTICLE VIII 
 MAINTENANCE, REPLACEMENT AND CHANGES 
 8.01 Routine Repairs and Maintenance 
 From and after
the Management Commencement Date, Management Company shall maintain the Hotel in good repair and condition and in conformity with applicable laws and regulations and in accordance with the Franchisor’s standards for the operation of the Hotel
and shall make or cause to be made such routine maintenance, repairs and minor alterations, the cost of which can be expensed under GAAP, as Management Company, from time to time, deems necessary for such purposes. The cost of such maintenance,
repairs and alterations shall be paid from Gross Revenues and shall be treated as a Deduction in determining Operating Profit. The cost of non-routine repairs and maintenance, either to the Hotel building or its fixtures, furniture, furnishings and
equipment (“FF&E”), shall be paid for in the manner described in Sections 8.02 and 8.03. 
  

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 8.02 Repairs and Equipment Reserve 
 A. Management Company shall establish, in respect of each Fiscal Year from and after the Management Commencement Date, a reserve escrow account in the name of Owner (“Reserve”) in a bank approved by Owner.
All disbursements and withdrawals from the Reserve shall be made by representatives of Management Company whose signatures have been authorized. The Reserve shall be in an amount equal to the greater of:
(i)         % of Gross Revenues or (ii) the amount required under the Franchise Agreement for the Hotel or by any Qualified Lender, in a bank, savings and loan association or other financial
institution designated by Owner to cover the cost of: 
 1. Replacements and renewals to the Hotel’s FF&E; and 
 2. Certain non-routine repairs and maintenance to the Hotel building which are normally capitalized under GAAP, such as exterior and interior repainting,
resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like, but which are not major repairs, alterations, improvements, renewals or replacements to the Hotel building’s structure or to its mechanical,
electrical, heating, ventilating, air conditioning, plumbing or vertical transportation systems, the cost of which are Owner’s sole responsibility under Section 8.03. 
 B. All amounts from time to time in the Reserve, and all interest thereon, shall at all times be owned by, and be the exclusive property of, Owner, and
Management Company shall make no claim thereto. Proceeds from the sale of FF&E no longer necessary for the operation of the Hotel shall be deposited in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither
(i) proceeds from the disposition of FF&E, nor (ii) interest which accrues on amounts held in the Reserve, shall either (x) result in any reduction in the required contributions to the Reserve set forth in 8.02 A above, or
(y) be included in Gross Revenues. Management Company shall provide to Owner each month a copy of the bank statement relating to the Reserve and a reconciliation of such Reserve account. 
 C. Management Company shall prepare an estimate (“FF&E Estimate”) of the expenditures necessary for (i) replacement and renewal of the
Hotel FF&E and (ii) building repairs of the nature contemplated by Section 8.02 A 2 during the ensuing Fiscal Year, and shall submit such Estimate to Owner for Owner’s review and approval at the same time it submits the Annual
Operating Projection described in Section 9.03. 
 D. Management Company shall from time to time make such substitutions and
replacements of or renewals to FF&E and repairs to the Hotel of the nature described in Section 8.02 A 2, as are provided for in the FF&E Estimate approved for such Fiscal Year by Owner pursuant to Section 8.02 C, provided that
Management Company shall not expend more than the balance in the Reserve without the prior approval of Owner. 
  

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 Management Company will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom
(but not exceeding the Reserve balance), in its reasonable discretion, provided that (a) such departures from the FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such
FF&E Estimate; and (b) such departures from the FF&E Estimate result from circumstances which require prompt repair and/or replacement; and (c) Management Company has submitted to Owner a revised FF&E Estimate setting forth and
explaining such departures. At the end of each Fiscal Year, any amounts then remaining in the Reserve shall be carried forward to the next Fiscal Year. 
 E. If any FF&E Estimate which is prepared for a given Fiscal Year would require funding in excess of the percentage of Gross Revenues which is required under Section 8.02 A, Owner may elect one of the
following: (i) agree to increase the percentage of Gross Revenues up to the level set forth in such FF&E Estimate, in order to provide the additional funds required, such increases to be treated as Deductions; (ii) make a lump-sum
contribution to the Reserve in the necessary amount and agree not to have such contribution reimbursed from Gross Revenues (in which case the amount of such contribution shall be added to Additional Invested Capital) or (iii) make a lump-sum
contribution to the Reserve in the necessary amount, in which case such contribution plus interest (at Prime Rate plus one percentage point per annum), shall be reimbursed to Owner from Gross Revenues in equal installments over a period of time
mutually agreed upon by Owner and Management Company, and such installment repayments shall be Deductions. If Owner elects not to agree to any of such options for excess funding of the Reserve, Management Company shall be entitled, at its option, to
terminate this Agreement upon ninety (90) days’ written notice to Owner; however, such failure by Owner shall not be deemed a Default by Owner unless such failure to provide excess funding will cause a default by Owner under
Section 16.01.F of this Agreement. 
 8.03 Building Alterations, Improvements, Renewals and Replacements 
 A. Management Company shall prepare an annual estimate (“Building Estimate”) of the expenses necessary for major repairs, alterations,
improvements, renewals and replacements (which repairs, alterations, improvements and renewals are not routine maintenance, repairs and alterations referred to in Section 8.02) to the structural, mechanical, electrical, heating, ventilating,
air conditioning, plumbing and vertical transportation elements of the Hotel building, including any such Owner-Funded Capital Expenditures required under the Franchise Agreement (“Owner-Funded Capital Expenditures”) and shall submit such
Building Estimate to Owner for its approval at the same time the Annual Operating Projection described in Section 9.03 is submitted. Management Company shall not make any Owner-Funded Capital Expenditures without the prior written consent of
Owner except to the extent such expenditures are: (i) required by any law (including, without limitation, any law, ordinance, code or regulation of any governmental authority or agency having jurisdiction over the business or operation of the
Hotel), or (ii) otherwise required to avoid the risk of harm or further damage to persons or property. 
  

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 B. The cost of all Owner-Funded Capital Expenditures shall be borne solely by Owner and shall not be paid
from Gross Revenues or from the Reserve. The failure of Owner to provide funding for any Owner-Funded Capital Expenditure described in clause (i) or (ii) of Section 8.03 A shall be a Default by Owner and Management Company shall be
entitled to terminate this Agreement (along with other remedies it may have under this Agreement). 
 8.04 Liens 
 Management Company and Owner shall use their best efforts to prevent any liens from being filed against the Hotel which arise from any maintenance,
changes, repairs, alterations, improvements, renewals or replacements in or to the Hotel. They shall cooperate fully in obtaining the release of any such liens, and the cost thereof, if the lien was not occasioned by the fault of either party, shall
be treated the same as the cost incurred pursuant to Section 8.03. If the lien arises as a result of the fault of either party, then the party at fault shall bear the cost of obtaining the lien release. 
 8.05 Ownership of Replacements 
 All changes, repairs,
alterations, improvements, renewals, or replacements to the Hotel made pursuant to this Article VIII shall be the property of Owner. 
 ARTICLE IX 
 BOOKKEEPING AND BANK ACCOUNTS 
 9.01 Books and Records 
 Books of control and account shall be kept on the accrual basis and in
material respects in accordance with the Uniform System of Accounts and GAAP with the exceptions provided in this Agreement. Owner may, at reasonable intervals during Management Company’s normal business hours, examine such records. Within
sixty (60) days following the close of each Fiscal Year, Management Company shall furnish Owner a statement (the “Annual Operating Statement”) in reasonable detail summarizing the Hotel operations for such Fiscal Year and a
certificate of Management Company’s chief accounting officer certifying that such year-end statement is true and correct to the best of his or her knowledge and belief. If Owner raises no objections within thirty (30) days after receipt of
the Annual Operating Statement, the Annual Operating Statement shall be deemed to have been accepted by Owner. If Owner does raise any such objection, Owner shall arrange for an independent audit to be commenced within sixty (60) days after the
date of such objection, and shall diligently cause such audit to be completed within a reasonable period of time and the Management Company shall, at no expense to Management Company, cooperate with such audit. Owner shall pay all costs of such
audit at its sole expense (and not as a Deduction); however, if such audit establishes that Management Company has understated Operating Profit for that Fiscal Year by five percent (5%) or more, the reasonable costs and expenses of such audit
shall be paid directly by Management Company from its own funds and shall not be treated as Deductions. 
  

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 9.02 Hotel Accounts: Expenditures 
 A. All funds derived from the operation of the Hotel shall belong to and be the property of Owner and shall be deposited by Management Company in bank accounts established by Management Company for Owner in one or
more banks approved by Owner. All disbursements and withdrawals from said accounts as required or permitted under this Agreement (i.e., the payment of all Deductions and the distribution of Operating Profit) shall be made by bonded representatives
of Management Company whose signatures have been authorized. Reasonable petty cash funds and house banks, in amounts satisfactory to Owner, shall be maintained at the Hotel. 
 B. All payments to be made by Management Company hereunder shall be made from authorized bank accounts, from petty cash funds or from Working Capital
provided by Owner pursuant to Section 7.01. Debts and liabilities incurred by Management Company as a result of its operation and management of the Hotel pursuant to the terms hereof, whether asserted before or after Termination, will be paid
by Owner to the extent funds are not available for that purpose from Gross Revenues. Management Company shall not be required to make any advance or payment to or for the account of Owner except out of such funds, and Management Company shall not be
obligated to incur any liability or obligation for Owner’s account without assurances that necessary funds for the discharge thereof will be provided by Owner. 
 C. All bank accounts shall be owned by Owner and shall be solely controlled and operated by Management Company as the agent of Owner; the agency status of Management Company shall be designated on the checks and
drafts drawn on such banks accounts. 
  

	9.03	Annual Operating Projection 

 A. On or before the
first day of December of each Fiscal Year, a preliminary draft of the budget (“Annual Operating Projection”), setting forth Management Company’s reasonable estimate of Gross Revenues, Deductions, Operating Profit and such other
information as Owner or a Qualified Lender may reasonably request for the Hotel for the forthcoming Fiscal Year, shall be prepared by Management Company and submitted to Owner for its review and approval (which shall not be unreasonably withheld or
delayed). In the event that Management Company is seeking reimbursement from Owner pursuant to Section 14.01.B(i) for the salaries, wages and/or benefits of any officers or directors of Management Company or Management Company’s Affiliates
who shall be regularly or temporarily employed or assigned on a full-time basis at the Hotel, this shall be shown as a separate line item under the Deductions category of the Annual Operating Projection. On or before the fifteenth (15th) day of December of each Fiscal Year, Management Company and Owner shall have a meeting to discuss the Annual Operating
Projection; provided that Management Company shall submit the Annual Operating Projection to Owner at least fourteen (14) days in advance of such meeting (or such meeting shall be rescheduled to a 
  

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 date that is at least fourteen (14) days after the submission of the Annual Operating Projection to Owner). If Owner
does not approve the preliminary Annual Operating Projection in full, within thirty (30) days of its receipt, Owner shall notify Management Company of each category of expenses (a “Category”) of which Owner does not approve. The
preliminary Annual Operating Projection thereafter shall be revised as Owner and Management Company may agree, and shall, upon Owner’s approval, constitute the approved Annual Operating Projection for the forthcoming Fiscal Year. In the event
that Owner does not notify Management Company in writing within said 30-day period that it does not approve of specified Categories, the preliminary Annual Operating Projection shall constitute the approved Annual Operating Projection for the
forthcoming Fiscal Year. The approval of Owner shall not be required with respect to any Category if, and to the extent that, the preliminary Annual Operating Projection with respect to such Category for a given Fiscal Year is, in all material
respects (taking into account any extraordinary non-recurring items), the same as the Annual Operating Projection for the preceding Fiscal Year as adjusted by the Consumer Price Index. 
 B. The Annual Operating Projection is an estimate only and Management Company shall, from time to time during each Fiscal Year as it deems appropriate,
suggest revisions thereto for Owner’s review and approval. Management Company will at all times give good faith consideration to Owner’s suggestions regarding any Annual Operating Projection. Management Company shall not, except as
provided in Sections 8.03 A above and 9.03 C and 9.03 D below, depart from any approved Annual Operating Projection, or make any expenditures or incur any expenses not provided for therein, without Owner’s prior approval. 
 C. If Owner and Management Company fail to mutually agree on any given Category or Categories in the preliminary Annual Operating Projection within
forty-five (45) days after the submission to Owner of the preliminary draft described in the first sentence of 9.03 A, Management Company shall continue to manage and operate the Hotel as follows until such agreement is reached: (i) with
respect to each Category in such preliminary Annual Operating Projection which has been approved or deemed approved by Owner, Management Company may make expenditures and incur obligations under such Category as so approved; and (ii) with
respect to any Category which has not been approved by Owner, Management Company may continue to make expenditures and incur obligations under such Category in accordance with the amounts provided for such Category in the Annual Operating Projection
approved for the prior Fiscal Year, as adjusted by the Consumer Price Index, with such additional adjustments therein as shall be necessary to take into account (x) any differences in occupancy which may be experienced in the current Fiscal
Year as compared to the prior Fiscal Year with respect to those costs that are occupancy sensitive, and (y) any increased costs beyond the control of Management Company for the same or comparable services or products. 
 D. Owner and Management Company acknowledge that the Annual Operating Projection approved by Owner is an estimate only and that unforeseen circumstances
such as, but not limited to, the costs of labor, materials, services and supplies, casualty, operation of law, or economic and market conditions may make adherence to the Annual 
  

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 Operating Projection impracticable for certain Categories. If in the judgment of the Management Company the expenditures
reasonably expected to be made in any of the following Categories during the then current Fiscal Year exceed by five percent (5%) or more the amount budgeted for such Category in the then current Annual Operating Projection, Management Company
shall notify Owner promptly in writing: Rooms; Food, Beverage and Banquet; Telephone, Gift Shop, and other; Administrative and General; Advertising and Sales; Repairs and Maintenance; Salaries and Wages. Management Company shall, as soon as
practicable thereafter, consult with, and advise, Owner concerning expenditures for such Category or Categories. The Category under which any expenditure or obligation falls shall be determined in accordance with the Uniform System of Accounts.

 9.04 Operating Deficits 
 If Management
Company should anticipate any Operating Loss for any Accounting Period, Management Company shall immediately so advise Owner in writing, setting forth the estimated amount of such deficiency and an explanation or justification therefor. 

ARTICLE X 
 FRANCHISE
AGREEMENT 
 During the Term of this Agreement, the Hotel shall be managed and operated in strict compliance with the terms and
conditions of the Franchise Agreement (including but not limited to all terms and conditions regarding confidentiality and operation of the Hotel), and Management Company, to the extent sufficient Working Capital exists, shall at all times comply
with such Agreement and advise and assist Owner in the performance and discharge of its covenants and obligations thereunder. Owner shall comply with any capital expenditure, product improvement plan, operating standard changes or other requirements
imposed from time to time by the Franchisor under the Franchise Agreement, the cost of which shall be paid in accordance with this Agreement. In the event of any conflicts between any provisions of this Agreement and the Franchise Agreement, the
provisions of the Franchise Agreement shall control. Owner acknowledges that Franchisor shall have the right to communicate directly with Management Company regarding day-to-day operation of the Hotel. Owner shall not enter into any amendment,
restatement or renewal of the Franchise Agreement which would in any event have an adverse impact on the amount of fees to be paid to Management Company under this Agreement without Management Company’s prior written approval, which approval
may be withheld in Management Company’s sole discretion. [insert additional provisions that applicable Franchise Agreement may require to be included] 
  

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 ARTICLE XI 
 POSSESSION AND USE OF HOTEL 
 11.01 Use 
 A. [Intentionally Deleted] 
 B. Management
Company shall manage and operate the Hotel in accordance with this Agreement and the Franchise Agreement and shall in addition comply with and abide by all applicable laws, ordinances, and regulations. 
 C. Provided that Owner shall first have employed a replacement manager for the Hotel satisfactory to and approved by the “Franchisor” under the
Franchise Agreement, Management Company shall have the option to terminate this Agreement at any time upon sixty (60) days’ written notice to Owner in the event of a withdrawal or revocation, by any lawful governing body having
jurisdiction thereof, of any material license or permit required for Management Company’s performance hereunder, if such withdrawal or revocation is due to circumstances beyond Management Company’s control or not otherwise caused by the
gross negligence or willful misconduct of Management Company, such termination to be effective as of the date such replacement manager has commenced management of the Hotel pursuant to its agreement with Owner. 
 11.02 Owner’s Right to Inspect 
 Owner or its
agent shall have access to the Hotel at any and all reasonable times for the purpose of protecting the same against fire or other casualty, prevention of damage to the Hotel, inspection, making repairs, or showing the Hotel to prospective
purchasers, tenants or mortgagees. Owner shall provide at least 24 hours’ notice to Management Company prior to exercising its rights under this Section 11.02, except in the event of an emergency. 
 11.03 Group Services 
 A. Subject to
Section 11.03 B, Owner shall reimburse Management Company for certain other services (“Group Services”) as may from time to time be provided to the Hotel by Management Company or Management Company’s Affiliates more efficiently
on a group rather than on an individual basis and approved by Owner. The Group Services may include, without limitation, the following: (a) marketing, advertising and promotion; (b) payroll processing, accounting and MIS support services;
(c) recruiting, training, career development and relocation in accordance with Management Company’s or its Affiliates’ relocation plan; (d) employee benefits administration; (e) engineering and risk management;
(f) information technology; (g) legal support (such as license and permit coordination and standardized contracts); (h) purchasing arising out of ordinary hotel operations; and (i) such other additional services as are or may be,
from time to time, furnished for the benefit of Management Company’s hotels or in substitution for services now performed at Management Company’s individual hotels which may be more efficiently performed on a group basis. 
 B. Group Services shall consist of the actual cost of the services without mark-up or profit to Management Company or any Affiliates, but shall include:
(a) salary and employee benefit costs, (b) cost of equipment used in performing Group Services, and (c)
  

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 overhead costs, reasonably allocated thereto of any office providing Group Services. Costs and expenses incurred in
providing Group Services shall be allocated equitably across hotel properties that Management Company manages that are provided Group Services, to the extent necessary and appropriate, and in the manner described in the Annual Operating Projection
approved by Owner. Notwithstanding anything herein to the contrary, the costs and expenses for Group Services shall not exceed the amounts for such services set forth in the Annual Operating Projection approved by Owner. Costs of Group Services
(approved by Owner pursuant to this subsection B) shall be Deductions. In addition, if equipment is installed and maintained at the Hotel in connection with the rendition of any approved Group Services, all costs thereof will be charged to the
operation of the Hotel, as determined by Management Company in good faith and consistent with GAAP and the Uniform System of Accounts. Unless a Group Service is approved in the Annual Operating Projection, such service(s) shall be performed at the
Hotel and the cost thereof shall be a Deduction as set forth in the approved Annual Operating Projection. 
 C. In no event shall Management
Company’s Affiliates be deemed a party to this Agreement or responsible in any way for Management Company’s obligations pursuant to this Agreement by virtue of providing any services described in this Agreement (including, without
limitation, Group Services) to Management Company and Owner reimbursing Management Company for the expenses incurred in connection therewith. Management Company shall make (or cause to be made) available to Owner the books of any such Affiliate
providing any such services to the extent necessary to complete an audit arranged by Owner pursuant to Section 9.01 of this Agreement. 
 11.04
Rebates 
 Any rebates, refunds or similar payments (for purposes of this Section 11.04, collectively referred to as
“rebates”) made to Management Company or any of its Affiliates from vendors or others providing services or goods to the Hotel shall be returned to the Hotel bank account or Reserve, as the case may be, from which payment for such services
or goods was made and shall constitute Gross Revenues. Any such rebates made to Management Company or any of its Affiliates from vendors or others for goods and services provided to a group of hotels operated by Management Company or its Affiliates,
including the Hotel, shall be equitably allocated among such hotels and the Hotel’s equitable share thereof shall be returned to the Hotel bank account or Reserve, as the case may be, from which payment for such services or goods was made and
shall constitute Gross Revenues. 
 ARTICLE XII 
 INSURANCE 
 12.01 Property and Operational Insurance 
 A. Management Company shall, commencing with the Management Commencement Date and continuing throughout the Term of this Agreement, procure and maintain,
as a Deduction, with insurance companies (i) reasonably acceptable to Owner, 
  

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 (ii) required by a Qualified Lender, and (iii) licensed to underwrite the type of insurance being issued in the
jurisdiction in which such insurance policy shall be delivered, a minimum of the following insurance to the extent reasonably commercially available. Subject to Owner’s and any Qualified Lender’s prior approval (in their sole discretion),
Management Company may procure and maintain such insurance as required in this Section 12.01 by legally qualifying itself as a self insurer: 
 1. Insurance on the Hotel (including contents) against loss or damage by fire, lightning and all other risks covered by the usual standard extended coverage endorsements, with deductible limits approved by Owner, in an amount not less than
one hundred percent (100%) of the replacement cost thereof; 
 2. Insurance against loss or damage from explosion of boilers, pressure
vessels, pressure pipes and sprinklers, to the extent applicable, installed in the Hotel; 
 3. Insurance on the Hotel (including contents)
against loss or damage by earth movement, with deductible limits approved by Owner, in an amount to be reasonably determined by Owner consistent with local market conditions; 
 4. Business interruption insurance covering loss of profits and necessary continuing expenses for interruptions caused by any occurrence covered by the
insurance referred to in Section 12.01 A1, A2, and A3, of a type and in amounts and with such deductible limits as are approved by Owner; 
 5. Workers’ compensation and employer’s liability insurance as may be required under applicable laws and employment-related practices insurance covering all of Management Company’s employees at the Hotel in each case, with
such deductible limits as are approved by Owner; 
 6. Fidelity bonds, in amounts and with deductible limits approved by Owner, covering
Management Company’s employees in job classifications which Owner reasonably requests be bonded, and comprehensive crime insurance to the extent that Management Company and Owner mutually agree it is necessary for the Hotel; 
 7. Comprehensive General Public Liability insurance (including protective liability coverage on operations of independent contractors engaged in
construction, operation or management, blanket contractual liability insurance, liquor law legal liability insurance, products liability insurance, and garage keeper’s liability insurance), on an “occurrence” basis for the benefit of
Owner and Management Company against claims for “personal injury” liability, including, without limitation, bodily injury, death, or property damage liability, with a limit of not less than Twenty Five Million Dollars ($25,000,000) in the
event of “personal injury” to any number of persons or damage to property arising out of any one occurrence; such insurance, which may be furnished under a “primary policy” (which shall include an aggregate per location
endorsement) and an “umbrella” policy or policies, shall also include: (i) coverage against liability for bodily injuries or property damage arising out of the use by or on behalf of Owner or Management Company of any 
  

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 owned, non-owned, or hired automotive equipment for a limit not less than that specified above, and (ii) if
applicable, garage keeper’s legal liability insurance in the amount sufficient to prevent Owner from becoming a co-insurer; 
 8. Crime
insurance and errors and omissions insurance insuring Owner against intentional or negligent acts or omissions of Management Company or its employees, such insurance to be in such amounts, with such carriers, and under such policies, as may from
time to time be requested and approved by Owner; and 
 9. Such other insurance in amounts as Management Company and Owner, in their
reasonable judgment, mutually deem advisable for protection against claims, liabilities and losses arising out of or connected with the operation of the Hotel. Notwithstanding anything in this Agreement to the contrary, the provisions of this
Article XII shall be subject to the reasonable requirements of a Qualified Lender. 
 12.02 General Insurance Provisions 
 A. All policies of insurance required under Section 12.01, Paragraphs 1-4 shall be carried in the name of Management Company, Owner and the Qualified
Lender; and losses thereunder shall be payable to the parties as their respective interests may appear. All insurance described in Section 12.01, Paragraphs 6-8 shall name Owner as an additional insured. 
 B. Owner and Management Company shall release each other, and their respective authorized representatives, agents and employees, from any claims for
damage or loss to any person or to the Hotel that may be caused by or result from risks insured under any insurance policies carried by said parties and in force at the time any such damage or loss occurs, to the extent that such release does not
impair any insurance coverage then in effect. To the extent waivers of subrogation are acceptable to the insurance carrier each policy of insurance shall provide that the carrier shall have no right of subrogation against either party hereto, their
authorized representatives, agents or employees by separate endorsement. If extra premium is charged for such waiver of subrogation, the party for whom such waiver is obtained shall pay the other party such extra premium within ten
(10) business days after request therefore together with a copy of the invoice evidencing the same. 
 12.03 Coverage 
 All insurance described in Section 12.01 may be obtained by Management Company by endorsement or equivalent means under its blanket insurance
policies, provided that such blanket policies are satisfactory to and approved by Owner. Management Company may self insure or otherwise retain such risks or portions thereof as it does with respect to other similar hotels it owns, leases or
manages. 
  

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 12.04 Cost and Expense 
 A. Insurance premiums and any costs or expenses with respect to the insurance described in Section 12.01 shall be treated as Deductions in determining Operating Profit. 
 B. Upon Termination of this Agreement, an escrow fund in an amount reasonably acceptable to Management Company shall be established from Gross Revenues
(or, if Gross Revenues are not sufficient, with funds provided by Owner) to cover the amount of any costs which will eventually have to be paid by either Owner or Management Company with respect to insurance premiums, if any, not fully billed and
paid for prior to Termination and pending or contingent claims, including those which arise after such Termination for causes arising during the Term of this Agreement. Upon the final disposition of all such pending or contingent claims, any
unexpended funds remaining in such escrow shall be paid to Owner. 
 12.05 Policies and Endorsements 
 A. The party procuring insurance hereunder shall deliver to the other party certificates of insurance with respect to all policies so procured, including
existing, additional and renewal policies and, in the case of insurance about to expire, shall deliver certificates of insurance with respect to the renewal policies not less than ten (10) days prior to the respective dates of expiration.

 B. All policies of insurance provided for under this Article XII shall, to the extent obtainable, have attached thereto an endorsement
that such policy shall not be canceled, non-renewed or to the extent reasonably commercially available, materially changed without at least thirty (30) days’ prior written notice to Owner and Management Company. 
 C. Owner may, at its option, procure and maintain the insurance specified in Section 12.01, Paragraphs 1 through 4, with insurance companies
reasonably acceptable to Management Company, subject to the following: (i) all such policies of insurance shall be carried in the name of Owner, with Management Company as a named insured, (ii) any property losses thereunder shall be
payable to the respective parties as their interests may appear, and (iii) premiums for such insurance coverage shall be treated as Deductions, provided that if the cost of such insurance procured by Owner exceeds the cost of Management
Company’s comparable coverage, all such excess costs shall be the sole responsibility of Owner and shall not be a Deduction. Should Owner exercise its option to procure the insurance described in this subsection C, Owner hereby waives its
rights of recovery from Management Company and its Affiliates (and their respective directors, officers, shareholders, agents and employees) for loss or damage to the Hotel and any resultant interruption of business. 
 12.06 Indemnification 
 A. Owner shall indemnify,
defend and hold Management Company, Barceló Crestline Corporation and their respective directors, officers, shareholders, employees and agents (collectively, “Management Company Indemnified Parties”), harmless from and 

 

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 against all claims, causes of action, losses, attorneys’ fees and other costs and expenses (including, but not
limited to, liquidated damages, transfer fees, and termination costs), liabilities and damages (collectively referred to as “Claims”) imposed upon or incurred by or asserted against Management Company Indemnified Parties under, or on
account of, or with respect to this Agreement arising out of or resulting from: (i) Management Company’s due performance of this Agreement, or (ii) the failure by Owner to provide necessary funds to the Reserve or make necessary
Owner-Funded Capital Expenditures required under this Agreement or to comply with applicable legal requirements or any requirements imposed by the Franchisor in accordance with the Franchise Agreement or necessary to maintain the safety or
structural soundness of the Hotel, except to the extent the condition giving rise to such required expenditures is the result of Management Company’s gross negligence or willful misconduct. Without limiting the generality of the foregoing,
Owner shall indemnify, defend and hold Management Company Indemnified Parties harmless from and against all Claims imposed upon or incurred by or asserted against Management Company Indemnified Parties under or with respect to the Franchise
Agreement which arise as a result of: (a) any default by Owner under the terms of this Agreement or the Franchise Agreement (or related “Owner Agreement”) unless such default is a result of gross negligence or willful misconduct on
the part of Management Company; (b) the transfer by Owner of the Hotel or any interest of Owner in the Hotel, or (c) the failure by Owner to provide necessary funds to the Reserve or make necessary Owner-Funded Capital Expenditures
required to comply with applicable legal requirements or any requirements imposed by the Franchisor in accordance with the Franchise Agreement or necessary to maintain the safety or structural soundness of the Hotel. 
 B. Owner shall indemnify, defend and hold Management Company Indemnified Parties harmless from and against all Claims arising out of or resulting from
all liabilities which accrued (or which stem from events which occurred) prior to the Management Commencement Date (referred to as “Prior Liabilities”). Any such Prior Liabilities shall be paid for by Owner (not from Gross Revenues nor
from the Reserve) and shall not be treated as Deductions. 
 C. Management Company shall indemnify, defend and hold Owner and its directors,
officers, shareholders, employees and agents harmless from and against all Claims arising out of or resulting from any gross negligence or willful misconduct on the part of Management Company, its employees or agents. 
 D. The provisions of this Section 12.06 shall survive Termination of this Agreement. 
 ARTICLE XIII 
 REAL ESTATE AND PROPERTY TAXES 
 13.01 Impositions 
 During the Term of the Agreement all real estate or ad valorem property taxes, assessments, inventory and personal property taxes and similar charges on or relating to 
  

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 the Hotel (“Impositions”) following or allocable to the period following the Management Commencement Date shall
be paid by Management Company, to the extent sufficient Working Capital exists, from Gross Revenues before any fines, penalties, or interest are added thereto or liens are placed upon the Hotel, unless payment is in good faith being contested and
enforcement thereof is stayed. Management Company, either in its own name or, if legally required, in Owner’s name, may contest by appropriate proceedings conducted in good faith and with due diligence the amount, validity or application in
whole or in part of any such Imposition or any lien therefor, and Owner shall have the right to participate in any such proceedings. In addition, Owner shall have the right to contest, or cause Management Company to contest, the amount, validity or
application in whole or in part of any such Imposition or any lien therefore. In the event Gross Revenues are likely to be insufficient to pay such Impositions when due, Management Company shall so advise Owner no later than thirty (30) days
prior to the due date of such Impositions in order to provide Owner sufficient time in which to provide funds sufficient for the payment of such Impositions. Management Company shall also, no later than thirty (30) days prior to the date
payment is due or three (3) days following the written request from Owner, furnish Owner with copies of official tax bills and assessments and evidence of payment or contest thereof. Any refund or rebate of any Impositions shall be credited to
Operating Profit in the Fiscal Year in which such refund is received. All reasonable costs incurred in connection with any such negotiations or proceedings shall constitute Deductions for the year in which they are paid. Notwithstanding the
foregoing, no such contest shall be conducted if it will in any way endanger title to the Hotel, the land on which the Hotel is located or Owner’s interest in the Hotel, or create a cloud on title to any of the foregoing or constitute a default
under any financing secured by the Hotel, or otherwise expose Owner to the risk of criminal liability. Owner shall within thirty (30) days of receipt of evidence of payment or contest furnish Management Company with copies of official tax bills
and assessments and of payment or contest thereof. All Impositions shall constitute Deductions from Gross Revenues in determining Operating Profit provided, however, that any fines, penalties or interest added thereto to the extent resulting from
Owner’s acts or omissions shall be paid by Owner at its sole expense. 
 13.02 Owner’s Responsibility

 “Impositions” shall not include the following, all of which shall be paid solely by Owner, not from Gross Revenues nor from the
Reserve: (1) Any income, excess profits or revenue taxes of Owner or any person, firm or entity as a partner of Owner; (2) Special assessments imposed because of facilities which are constructed by or on behalf of the assessing
jurisdiction (e.g., roads, sidewalks, sewers, etc.) which directly benefit the Hotel; (3) “Impact Fees” which are required of Owner as a condition to the issuance of site plan approval, zoning variances or building permits; and
(4) “Tax-increment financing” or similar financing whereby the municipality or other taxing authority has assisted in financing the construction of the Hotel by temporarily reducing or abating normal Impositions in return for
substantially higher levels of Impositions at later dates. 
  

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 ARTICLE XIV 
 HOTEL EMPLOYEES 
 14.01 Employees 
 A. Management Company shall have the discretion and obligation to hire, promote, supervise, direct, train all employees at the Hotel, to fix their terms
of compensation and, generally to establish and maintain policies relating to employment at the Hotel. All such employees shall at all times be the employees of Management Company and not of Owner, and Owner shall have no responsibility or control
respecting such employees unless otherwise specified in this Agreement. No collective bargaining agreements will be signed without Owner’s approval. Management Company shall inform Owner as to the name, background, and qualifications of the
Hotel’s General Manager and Director of Sales. If Management Company desires to change the General Manager or Director of Sales, Management Company shall endeavor to give Owner at least forty-five (45) days’ prior notice, if feasible,
of such change stating the reasons for such change and informing Owner of the name, background, and qualifications of any replacement General Manager or Director of Sales. Owner shall have the right to interview the proposed replacement General
Manager or Director of Sales and shall be given the opportunity to meet with the appropriate senior executives of Management Company to discuss the advisability of effectuating any proposed hiring, dismissal or transfer and any possible alternatives
thereto. Any replacement General Manager (only) shall be subject to Owner’s prior approval, which approval shall not be unreasonably withheld or delayed. Management Company shall consider in good faith the opinions and requests of Owner with
respect to such matters, and, if Management Company elects not to implement any such request, Management Company shall explain its decision to Owner in reasonable detail. Owner acknowledges and approves
                                     as General Manager as of
the Management Commencement Date. 
 B. Owner shall reimburse Management Company for: (i) salaries, wages and/or benefits of any
officers, directors or employees of Management Company or Management Company’s Affiliates who shall be regularly employed or temporarily assigned on a full-time basis at the Hotel and (ii) personnel of Management Company or Management
Company’s Affiliates not employed at the Hotel providing information systems support or legal, accounting or tax services to Management Company in connection with the operation of the Hotel (without duplication of reimbursements included in
Group Services). All costs and expenses described under this Subsection B shall not exceed the amount for such services set forth in the approved Annual Operating Projection without the approval of Owner. 
 C. Management Company and Owner agree to cooperate with each other to attempt to avoid any disqualification of qualified employee benefit plans of either
of them to the extent such plans may be affected by the provisions of this Agreement or the services provided hereunder; provided, however, that neither Management Company nor Owner shall be required to change the terms of any such plan as part of
such cooperation. 
 D. All personnel employed at the Hotel shall be recruited and trained by Management Company in a manner consistent with
Management Company’s practices at 
  

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 other comparable hotels managed and operated by Management Company. Neither Owner nor Management Company shall directly
or indirectly solicit, employ, or hire any employees of the other party, without the other party’s consent, during the term of this Agreement and continuing for a period of one year following the Termination of this Agreement. Notwithstanding
the foregoing to the contrary, either party may use an independent employment agency or advertisements to make general solicitations for employment, provided that the other party’s employees are not targeted specifically. 
 14.02 Termination 
 At Termination, other than by reason of an Event of Default by Management Company hereunder, an escrow fund shall be established from Gross Revenues (or, if Gross Revenues are not sufficient, with funds provided by Owner) to reimburse
Management Company for all costs and expenses incurred by Management Company which arise out of either the transfer or the termination of employment of Management Company’s employees at the Hotel, such as reasonable transfer costs, unemployment
compensation, other employee liability costs (including without limitation costs incurred pursuant to the Worker Adjustment and Retraining Notification Act of 1990 (as amended, the “WARN Act”)) and a reasonable allowance for severance pay
for Executive Employees (as defined below) of the Hotel who do not continue to be employed with respect to the Hotel and who will not be transferred to another hotel owned or managed by Management Company. The amount of such allowance for severance
shall not exceed an amount equal to Management Company’s then current severance benefit for such terminated Executive Employees and that which is customary in the industry, unless Owner otherwise approves. As used herein, the term
“Executive Employees” shall mean each member of the senior executive staff and each department head of the Hotel. 
 14.03 Employee Claims 
 A. Management Company shall pay from its own funds, and not from Gross Revenues, for any Employee
Claim and for the defense of any Employee Claim which: (i) is a substantial violation of the standards of responsible labor relations as generally practiced by prudent owners or operators of similar hotel properties in the general geographic
area of the Hotel, or (ii) is not the isolated act of individual employees, but rather is a direct result of corporate policies or systematic action of Management Company which either encourage or fail to discourage such conduct. In addition,
Management Company shall indemnify, defend and hold harmless Owner from and against any fines or judgments arising out of such conduct, and all litigation expenses (including reasonable attorneys’ fees and expenses) incurred in connection
therewith. Any dispute between Owner and Management Company as to whether or not certain conduct by Management Company is not in accordance with the aforesaid standards shall be resolved by arbitration. 
  

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 ARTICLE XV 
 DAMAGE AND CONDEMNATION 
 15.01 Damage and Repair 
 A. If, during the Term hereof, the Hotel is damaged or destroyed by fire, casualty, or other cause, Owner shall, with all reasonable diligence, to the
extent that proceeds from the insurance described in Section 12.01 are available (subject to the provisions of any Mortgage encumbering the Hotel) for such purpose, repair or replace the damaged or destroyed portion of the Hotel to
substantially the same condition as existed previously; provided that Owner shall have no obligation to repair or replace the damaged or destroyed portion of the Hotel if: (i) such damage, destruction or casualty occurs within two
(2) years of the expiration of the Term, (ii) such damage, destruction or casualty is in excess of sixty percent (60%) of the “fair market value” of the Hotel as agreed by the parties, and (iii) Owner elects not to
rebuild the Hotel. In the event that the conditions set forth in (i), (ii), and (iii) of the preceding sentence are satisfied, Owner may terminate this Agreement provided that all amounts due to Management Company hereunder in connection with
such termination shall be paid by Owner. A termination under this Section 15.01 A shall not be a Default and no termination fees shall be paid to Management Company. 
 B. In the event damage or destruction to the Hotel from any cause materially and adversely affects the operation of the Hotel and Owner fails to timely (subject to unreasonable delays caused by Management Company,
including unreasonable delays in adjusting the insurance claim with the carriers which participate in Management Company’s blanket insurance program, and subject to Force Majeure delays) commence and complete the repairing, rebuilding or
replacement of the same so that the Hotel shall be substantially the same as it was prior to such damage or destruction, Management Company may, at its option, elect to terminate this Agreement upon ninety (90) days’ written notice.
Additionally, if the Franchise Agreement is terminated due to Owner’s failure to repair and restore the Hotel, this Agreement shall terminate, effective upon the termination of the Franchise Agreement. 
 15.02 Condemnation 
 A. If all or substantially all of the Hotel is taken in any eminent domain, condemnation, compulsory acquisition, or similar proceeding by any competent authority for any public or quasi-public use or purpose, this Agreement shall terminate
as of the date Management Company ceases to have physical possession of the Hotel. Any award for such taking or condemnation is to be paid to Owner, provided that Management Company may advance and collect any claims to which it may be entitled as a
result of such taking in accordance with the terms of Section 15.02 C. 
 B. In the event a portion of the Hotel shall be taken by the
events described in Section 15.02 A or the entire Hotel is affected on a temporary basis but the result is not to make it unreasonable to continue to operate the Hotel, this Agreement shall not terminate. However, so much of any award for any
such partial or temporary taking or condemnation shall be made available by Owner to the extent necessary to render the Hotel equivalent to its condition prior to such event, and the balance of such award, if any, shall be paid over to Owner.

  

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 C. All condemnation awards or payments in lieu thereof for the value of the land and improvements so
taken shall be the sole and exclusive property of Owner. Management Company may make a claim to the condemning authority for its loss of business arising from the events described in this Section 15.02, but only to the extent that such claim in
no way prejudices, diminishes, reduces, or impairs Owner’s rights under the preceding sentence. 
 ARTICLE XVI 
 DEFAULTS 
 16.01
Default 
 Each of the following shall constitute a “Default,” to the extent permitted by applicable law: 
 A. The appointment of a receiver, trustee, or custodian for all or any substantial part of the property of Management Company or Owner, as the case may
be, if such appointment is not set aside or vacated within sixty (60) days. 
 B. The commencement by Management Company or Owner, as
the case may be, of any voluntary case or proceeding under present or future federal bankruptcy laws or under any other bankruptcy, insolvency, or other laws respecting debtor’s rights. 
 C. The making of a general assignment by Management Company or Owner, as the case may be, for the benefit of its creditors. 
 D. The entry against Management Company or Owner, as the case may be, of any “order for relief” or other judgment or decree by any court of
competent jurisdiction in any involuntary proceeding against Management Company or Owner, as the case may be, under any present or future federal bankruptcy laws or under any other bankruptcy, insolvency, or other laws respecting debtor’s
rights, if such order, judgment, or decree continues unstayed and in effect for a period of sixty (60) consecutive days. 
 E. The
failure of Management Company or Owner, as the case may be, to make any payment to be made in accordance with the terms hereof within five (5) business days after written notice, when such payment is due and payable. 
 F. Receipt by the Franchisee of any notice from the Franchisor claiming or alleging any material default under the Franchise Agreement, if such default
is due to any act or omission of Owner or Management Company, as the case may be, and is not cured, to the satisfaction of the Franchisor within fifteen (15) days following the Franchisee’s receipt of such notice (or, if such default
cannot reasonably be cured within fifteen (15) days and Owner or Management Company, as the case may be, immediately proceeds with due diligence to cure such default, then within such additional period of time as is reasonably required for such
cure, taking into account the termination provisions of the Franchise Agreement). 
  

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 G. The failure of Owner to provide to Management Company sufficient Working Capital to operate the Hotel
as required by Article VII within three (3) days after written notice from Management Company of the need for such Working Capital. 
 H. The failure of Management Company or Owner, as the case may be, to perform, keep or fulfill any of the other covenants, undertakings, obligations, or conditions set forth in this Agreement, and the continuance of such default for a
period of thirty (30) days after notice of said failure, or if such default cannot be reasonably cured within said 30-day time period, the failure of the defaulting party to commence the cure of such Default within said 30-day period or
thereafter the failure to diligently pursue such efforts to completion. 
 16.02 Event of Default 
 Upon the occurrence of any Default by either party (referred to as the “defaulting party”) under Section 16.01 A, B, C or D, such Default
shall immediately and automatically, without the necessity of any notice to the defaulting party, constitute an “Event of Default” under this Agreement. Upon the occurrence of any Default by a defaulting party under Section 16.01 E,
F, G, or H, such Default shall constitute an “Event of Default” under this Agreement if the defaulting party fails to cure such Default within the respective cure or payment period (as specified in the applicable Paragraph) after written
notice from the non-defaulting party specifying such Default and demanding such cure or payment; provided, however, that if a Default under Section 16.01 H is such that it cannot reasonably be cured within said 30-day period, an “Event of
Default” shall then occur if the defaulting party fails to commence the cure of such Default within the specified 30-day period or thereafter fails to diligently pursue such efforts to completion. 
 16.03 Remedies upon Event of Default 
 Upon the occurrence of an Event of Default, the non-defaulting party shall have the right to pursue any one or more of the following courses of action: (i) in the event of a material breach by the defaulting
party of its obligations under this Agreement, to terminate this Agreement by written notice to the defaulting party, which Termination shall be effective as of the effective date which is set forth in said notice (provided that said effective date
shall be at least thirty (30) days after the date of said notice; or, if the defaulting party is the employer of all or a substantial portion of the employees at the Hotel, the 30-day period shall be extended to such period of time as may be
necessary under applicable law pertaining to termination of employment); and (ii) to institute any and all proceedings permitted by law or equity, including, without limitation, actions for specific performance and/or damages. Upon the
occurrence of a Default by either party under Section 16.01 E, the amount owed to the non-defaulting party shall accrue interest, at the rate described in Section 22.03, from and after the date on which such payment was originally due to
the non-defaulting party. The rights granted hereunder shall not be in substitution for, but shall be in addition to, any and all rights and remedies available to the non-defaulting party by reason of applicable provisions of law or equity.

  

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 ARTICLE XVII 
 PROPRIETARY MARKS; INTELLECTUAL PROPERTY 
 17.01 Proprietary Marks

 During the Term of this Agreement, the name “Crestline” or “Barceló Crestline,” whether used alone or in
connection with one or more other word(s), and all proprietary marks (being all present and future trademarks, trade names, symbols, logos, insignia, service marks, and the like) of Management Company or any one of its Affiliates, whether or not
registered (“Proprietary Marks”) shall in all events remain the exclusive property of Management Company and its Affiliates. Owner shall have no right to use any Proprietary Mark of Management Company or any one of its Affiliates, except
during the Term of this Agreement to have signage installed using any Proprietary Mark of Management Company or any one of its Affiliates in conformance with the specifications provided by Management Company. Upon Termination, any use of a
Proprietary Mark by Owner under this Agreement shall immediately cease. Upon Termination, Management Company shall have the option to purchase, at their then book value, any items of the Hotel’s Inventories and Fixed Asset Supplies as may be
marked with a Proprietary Mark of Management Company or any one of its Affiliates. In the event Management Company does not exercise such option, Owner agrees that it will use any such items not so purchased exclusively in connection with Hotel
until they are consumed. During the Term of this Agreement, the name
“                            ” whether used alone or in connection with one or more other
words, and all proprietary marks of Owner shall in all events remain the exclusive property of Owner and its Affiliates. Management Company shall have no right to use any proprietary mark of Owner or its Affiliates, except during the Term of this
Agreement to have signage installed using any proprietary mark of Owner or its Affiliates in conformance with the specifications provided by Owner. Upon Termination, any use of a proprietary mark of Owner or its Affiliates by Management Company
under this Agreement shall immediately cease. 
 17.02 Computer Software and Equipment 
 All “Software” (meaning all computer software and accompanying documentation, other than software which is commercially available, which are
used by Management Company in connection with the property management system, any reservation system and all future electronic systems developed by Management Company for use in the Hotel) is and shall remain the exclusive property of Management
Company or any one of its Affiliates (or the licensor of such Software, as the case may be), and Owner shall have no right to use, or to copy, any Software. Upon Termination, Management Company shall have the right to remove from the Hotel all
Software, and any computer equipment which is utilized as part of a centralized property management system or is otherwise considered proprietary by Management Company; provided, however, that if any of such computer equipment is owned by Owner,
Management Company shall reimburse Owner for previous expenditures made by Owner for the purchase of such equipment, subject to a reasonable allowance for depreciation. 
  

 -38- 

 17.03 Intellectual Property 
 All “Intellectual Property” (meaning all Software and manuals, brochures and directives issued by Management Company to its employees at the
Hotel regarding procedures and techniques to be used in operating the Hotel) shall at all times be proprietary to Management Company or its Affiliates, and shall be the exclusive property of Management Company or its Affiliates. Upon Termination,
all Intellectual Property shall be removed from the Hotel by Management Company, without compensation to Owner. 
  

 -39- 

 ARTICLE XVIII 
 WAIVER AND INVALIDITY 
 18.01 Waiver 
 The failure of either party to insist upon strict performance of any of the terms or provisions of this Agreement, or to exercise any option, right or
remedy herein contained, shall not be construed as a waiver or as a relinquishment for the future of such term, provision, option, right or remedy, but the same shall continue and remain in full force and effect. No waiver by either party of any
term or provision hereof shall be deemed to have been made unless expressed in writing and signed by such party. 
 18.02
Partial Invalidity 
 In the event that any portion of this Agreement shall be declared invalid by order, decree or judgment of a
court, this Agreement shall be construed as if such portion had not been inserted herein except when such construction would operate as an undue hardship to Management Company or Owner or constitute a substantial deviation from the general intent
and purpose of said parties as reflected in this Agreement. 
 ARTICLE XIX 
 ASSIGNMENT 
 19.01 Assignment by Management Company and
Owner 
 A. Management Company shall not assign this Agreement, or delegate any of its responsibilities hereunder, without the prior
written consent of Owner; provided, however, that Management Company, shall have the right, without such consent, to assign its interest in this Agreement to any of its Affiliates, and any such Affiliate shall be deemed to be the Management Company
for purposes of this Agreement. Management Company shall be relieved of all further obligations hereunder if such Affiliate has substantially similar financial resources and liquidity as Management Company and the expertise to perform the
obligations of Management Company hereunder including, without limitation, access to the Group Services that are currently being provided by Management Company at the time of such assignment. 
 B. Except as permitted pursuant to Section 20.01 B, Owner shall not assign this Agreement, without the prior written consent of Management Company;
provided, however, that Owner may assign this Agreement upon notice to Management Company to any wholly-owned subsidiary of Owner but only if such subsidiary owns one hundred percent (100%) of the Hotel; and upon such assignment and assumption
of this Agreement by the assignee, Owner shall be relieved of all further liability or obligation hereunder. 
 C. Notwithstanding any
provision contained in this Agreement, (i) the collateral assignment of this Agreement by Owner as security for any Mortgage securing a Qualified Loan or (ii) the transfer of this Agreement in connection with a merger or consolidation or a

  

 -40- 

 sale of all or substantially all of the assets of either party (provided that (x) if such transfer is by Owner, the
provisions of Article XX shall be complied with, and (y) if such transfer is by Management Company, such transfer is being done as part of a merger or consolidation or a sale of all or substantially all of the business which consists of
Management Company’s managed hotels), is permitted without the consent of the other party. 
 D. If either party consents to an
assignment of this Agreement by the other, no further assignment shall be made without the express consent in writing of such party, unless such assignment may otherwise be made without such consent pursuant to the terms of this Agreement.

 E. An assignment (either voluntarily or by operation of law) by either party of its interest in this Agreement shall not relieve either
party from its obligations under this Agreement which accrued prior to the date of such assignment; such assigning party shall be relieved of such obligations accruing after such date, if the assignment complies with this Article XIX and if
Management Company or Owner, as the case may be, has received an assumption agreement executed by the assignee. 
 ARTICLE XX

 TERMINATION OF AGREEMENT UPON SALE, DEMOLITION, OR FORECLOSURE 
 20.01 Sale of the Hotel 
 A. Sale to Permitted Transferee. Owner may enter into a Sale of the Hotel to any individual or entity that: (i) has sufficient financial resources and liquidity to fulfill Owner’s obligations under this Agreement, and
(ii) is not in control of or controlled by persons who have been convicted of felonies involving moral turpitude in any state or federal court, and (iii) is not engaged in the business of operating or managing (as distinguished from
owning) 2,000 or more guestrooms of a recognized branded hotel chain or chains in competition with Management Company. If Owner enters into an agreement for the Sale of the Hotel to a purchaser or tenant that violates the provisions of this
Section 20.01 A and Management Company has notified Owner of such non-compliance, Owner shall be deemed to be in Default hereunder unless the Sale Termination Fee is paid to Management Company as described in Section 20.01D. 
 B. Written Notice of Sale and Assignment of Management Agreement. In the event that Owner enters into a definitive agreement with respect to the
Sale of the Hotel and desires to have this Agreement assigned to the new owner, Owner shall give written notice thereof to Management Company, stating the name of the prospective purchaser or tenant. Such notice shall include appropriate information
relating to such prospective purchaser or tenant demonstrating compliance with Section 20.01 A. Concurrently with the finalization of such Sale of the Hotel, and only upon full compliance with the conditions set forth in Sections 20.01 A, B,
and C, the purchaser or tenant shall by appropriate instrument reasonably satisfactory to Management Company, assume all of Owner’s obligations hereunder. An executed copy of such assumption agreement shall be delivered to Management Company at
the closing or consummation of such Sale of the 
  

 -41- 

 Hotel. The assignment and assumption of this Agreement by a new owner of the Hotel upon the Sale of the Hotel in full
compliance with Sections 20.01 A, B, and C shall be deemed to be an assignment by Owner approved by Management Company pursuant to Section 19.01 B of this Agreement. This Agreement shall not be assigned to and assumed by any new owner of the
Hotel upon the finalization of a Sale of the Hotel if the conditions set forth in Sections 20.01 A, B, and C are not fully satisfied. 
 C.
Maintenance of Accounts. No Sale of the Hotel shall reduce or otherwise affect: (a) the current level of Working Capital; (b) the current amount deposited in the Reserve; or (c) any of the operating accounts maintained by
Management Company pursuant to this Agreement. If, in connection with any such Sale of the Hotel, the selling Owner intends to withdraw, for its own use, any of the cash deposits described in the preceding sentence, the selling Owner must obtain the
contractual obligation of the new Owner to replenish those deposits (in identical amounts) simultaneously with such withdrawal. The selling Owner is hereby contractually obligated to Management Company to ensure that such replenishment in fact
occurs. The obligations described in this Section 20.01 C shall survive the Sale of the Hotel and Termination of this Agreement. 
 D.
Termination Upon Sale of the Hotel. Notwithstanding any provision in this Agreement to the contrary (including, without limitation, Sections 20.01 A, B, and C above), Owner shall have the right to terminate this Agreement upon any Sale of the
Hotel provided that Owner: (i) provides at least sixty (60) days’ prior notice to Management Company, and (ii) remits to Management Company payment of the applicable Sale Termination Fee simultaneously with the Termination of
this Agreement. 
 21.02 Termination upon Demolition or Foreclosure 
 A. Owner may, by written notice to Management Company, terminate this Agreement upon the demolition of the Hotel, such Termination to be effective upon
the expiration of ninety (90) days following Management Company’s receipt of such notice from Owner. Any such notice shall contain sufficient information to permit Management Company to comply with any required notices to Hotel employees
under federal or state laws, including, without limitation, the WARN Act. Upon termination under this Section 20.02 A, all amounts due to Management Company hereunder in connection with such termination shall be paid by Owner. A termination
under this Section 20.02 A shall not be a Default and no termination fees shall be paid to Management Company. 
 B. Management Company
shall have the right to terminate this Agreement (and pursue any remedies it may have hereunder), on thirty (30) days’ written notice, if title to or possession of the Hotel is transferred by judicial or administrative process (including,
without limitation, a foreclosure, or a sale pursuant to an order of a bankruptcy court, or a sale by a court-appointed receiver) to an individual or entity which would not qualify as a permitted transferee under Section 20.01 A, regardless of
whether or not such transfer is the voluntary action of the transferring Owner, or whether (under applicable law) the Owner is in fact the transferor; provided, however, that Management Company shall not have the right to so terminate this Agreement
based on the assertion that a Qualified Lender fails to so qualify as a permitted transferee under Section 20.01 A. 
  

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 ARTICLE XXI 
 MANAGEMENT COMPANY CONDITIONS 
 21.01 Conditions upon Management Commencement
Date 
 The obligations of Management Company and Owner hereunder shall not commence until the satisfaction of the following conditions:

 A. Receipt of all licenses, permits, decrees, acts, orders and all other approvals necessary for the management and operation of the
Hotel. 
 A. The provision by Owner of the Working Capital described in Article VII. 
 ARTICLE XXII 
 MISCELLANEOUS 
 22.01 Right to Make Agreement 
 Each party warrants, with respect to itself, that neither the execution of this Agreement nor the finalization of the transactions contemplated hereby shall violate any provisions of law or judgment, writ, injunction,
order or decree of any court or governmental authority having jurisdiction over it; result in or constitute a breach or default under any indenture, contract, other commitment or restriction to which it is a party or by which it is bound; or require
any consent, vote or approval which has not been taken, or at the time of the transaction involved shall not have been given or taken. Each party covenants that it has and will continue to have throughout the Term of this Agreement and any
extensions thereof, the full right to enter into this Agreement and perform its obligations hereunder. 
 22.02
Relationship of Owner and Management Company 
 A. During the Term of this Agreement, Management Company shall qualify as an
“eligible independent contractor” as defined in Section 856(d)(9) of the Code. To that end, during the Term: 
  

	 	(a)	Management Company shall not permit wagering activities to be conducted at or in connection with the Hotel; 

  

	 	(b)	Management Company shall not own, directly or indirectly (within the meaning of Section 856(d)(5) of the Code), more than 35% of the shares of Highland;

  

	 	(c)	No more than 35% of the total combined voting power of Management Company’s outstanding stock, if any, (or 35% of the total shares of all classes of its outstanding stock)
shall be owned, directly or indirectly, by one or more persons owning 35% or more of the outstanding stock of Highland; and 

  

 -43- 

	 	(d)	Management Company (or a person who is a “related person” within the meaning of Section 856(d)(9)(F) of the Code (a “Related Person”) with respect to the
Management Company) shall be actively engaged in the trade or business of operating “qualified lodging facilities” (defined below) for one or more persons who are not Related Persons with respect to Owner (“Unrelated Persons”).
In order to meet this requirement, Management Company agrees that it (or a Related Person with respect to Management Company) (i) shall derive at least 10% of both its revenue and profit from operating “qualified lodging facilities”
for Unrelated Persons and (ii) shall comply with any regulations or other administrative guidance under Section 856(d)(9) of the Code with respect to the amount of hotel management business with Unrelated Persons that is necessary to
qualify as an “eligible independent contractor” with the meaning of such Code Section. 

 A “qualified lodging facility” is
defined in Section 856(d)(9)(D) of the Code and means a “lodging facility” (defined below), unless wagering activities are conducted at or in connection with such facility by any person who is engaged in the business of accepting
wagers and who is legally authorized to engage in such business at or in connection with such facility. A “lodging facility” is a hotel, motel or other establishment more than one-half of the dwelling units in which are used on a transient
basis, and includes customary amenities and facilities operated as part of, or associated with, the lodging facility so long as such amenities and facilities are customary for other properties of a comparable size and class owned by other owners
unrelated to Owner. Management Company’s breach of the provisions of this Section 22.02 shall be a material Event of Default hereunder and be subject to the provisions of Section 16.03 of this Agreement. 
 B. Management Company shall perform its duties hereunder as agent for Owner. Nothing contained in this Agreement shall be construed to create a
partnership or joint venture between Owner and Management Company or their successors in interest. Neither party shall borrow money in the name of or pledge the credit of the other. 
 22.03 Failure to Perform 
 If Management Company or Owner at any time fails to make any payments as specified or required hereunder or fails to perform any other act required on its part to be made or performed hereunder, then the other party after thirty
(30) days’ written notice to the defaulting party may (but shall not be obligated to) pay any such delinquent amount or perform any such other act on the defaulting party’s part. Any sums thus paid and all costs and expenses incurred
in connection with the making of such payment or the proper performance of any such act, together with interest thereon at the lesser of (i) the interest rate allowed by the applicable usury laws, or (ii) the Prime Rate plus three percent
(3%), from the date that such payment is made or such costs and expenses incurred, shall constitute a liquidated amount to be paid by the defaulting party under this Agreement to the other party on demand. 
  

 -44- 

 22.04 Breach of Covenant 
 Owner and Management Company and/or their respective affiliated companies shall be entitled, in case of any breach of this Agreement by the other party or
others claiming through it, to injunctive relief and to any other right or remedy available at law. 
 22.05 Consents

 Except as herein otherwise provided, whenever in this Agreement the consent or approval of Owner or Management Company is required, such
consent or approval shall not be unreasonably withheld, conditioned or delayed. 
 22.06 Applicable Law and
Arbitration 
 This Agreement shall be construed under and shall be governed by the laws of the State where the Hotel is located. In the
event of any dispute, controversy or claim arising out of, or in connection with, or relating to this Agreement, or any breach, or alleged breach hereof, the same shall, upon the request of either Management Company or Owner, be submitted to and
settled by arbitration. The arbiters shall each have at least ten (10) years’ recent professional experience in the hotel industry. The arbiters are specifically directed: that the award be definite, certain and final as to the matters
submitted; and to permit or deny the relief sought in its entirety without partial allocations between the parties (i.e. the preceding shall be a so-called “baseball arbitration”). Otherwise, the arbitration shall be pursuant to, and in
accordance with, the commercial rules then in effect of the American Arbitration Association in the State where the Hotel is located, or at any other place or any other form of arbitration mutually acceptable to the parties so involved. Any award
rendered shall be final and conclusive upon the parties and a judgment thereon may be entered in the highest court of the forum, state or federal, having jurisdiction. The expenses of arbitration shall be borne equally by the parties to the
arbitration, provided that each party shall pay the cost of its own experts, counsel and evidence. 
 22.07 Headings 
 Headings of Articles and Sections are inserted only for convenience and are in no way to be construed as a limitation on the scope of the particular
Articles or Sections to which they refer. 
 22.08 Notices 
 Notices, statements and other communications to be given under the terms of this Agreement shall be in writing and delivered by hand against receipt or
sent by certified mail, return receipt requested, or by nationally recognized overnight courier: 
  

 -45- 

 To Owner: 
  

 c/o
Highland Hospitality Corporation 
 8405 Greensboro Drive, Suite 500 
 McLean, Virginia 22102 
 Attn: General Counsel 
 with a copy to: 
  

 c/o
Highland Hospitality Corporation 
 8405 Greensboro Drive, Suite 500 
 McLean, Virginia 22102 
 Attn: Chief Executive Officer 
 To Management Company: 
 Crestline Hotels & Resorts, Inc. 
 8405 Greensboro Drive, Suite 500 
 McLean, Virginia 22102 
 Attn: General Counsel 
 with a copy to: 
 Crestline Hotels & Resorts, Inc. 
 8405 Greensboro Drive, Suite 500 
 McLean, Virginia 22102 
 Attn: Chief Executive Officer 
 or at such other address as from time to time designated by the party receiving the notice. Any such notice which is properly mailed, as described above, shall be deemed
to have been served as of three (3) business days after said posting. 
 22.09 Environmental Matters 

A. For purposes of this Section 22.09, “hazardous materials” means any substance or material containing one or more of any of the
following: “hazardous material,” “hazardous waste,” “hazardous substance,” “regulated substance,” “petroleum,” “pollutant,” “contaminant,” or “asbestos,” as such terms
are defined in any applicable environmental law, in such concentration(s) or amount(s) as may impose clean-up, removal, monitoring or other responsibility under any applicable environmental law, or which may present a significant risk of harm to
guests, invitees or employees of the Hotel. 
  

 -46- 

 B. Regardless of whether or not a given hazardous material is permitted on the Hotel premises under
applicable environmental law, Management Company shall only bring on the premises such hazardous materials as are needed in the normal course of business of the Hotel. Management Company shall indemnify, defend and hold Owner and its Affiliates (and
their respective directors, officers, shareholders, employees and agents) harmless from and against all loss, costs, liability and damage (including, without limitation, engineers’ and attorneys’ fees and expenses, and the cost of
litigation) arising from the placing, discharge, leakage, use or storage of hazardous materials in violation of applicable environmental laws on the Hotel premises or in the Hotel by Management Company during the Term of this Agreement and shall be
responsible for the payment of any removal or remediation costs resulting therefrom. 
 C. In the event of the discovery of hazardous
materials (as such term may be defined in any applicable environmental law) on the Hotel premises or in the Hotel during the Term of this Agreement, Owner shall (except to the extent such removal is Management Company’s responsibility pursuant
to Section 22.09 B) promptly remove, if required by applicable environmental law, such hazardous materials, together with all contaminated soil and containers, and shall otherwise remedy the problem in accordance with all environmental laws.
Owner shall (except to the extent that the removal of such hazardous materials is Management Company’s responsibility pursuant to Section 22.09 B) indemnify, defend and hold Management Company and its Affiliates (and their respective
directors, officers, shareholders, employees and agents) harmless from and against all loss, costs, liability and damage (including, without limitation, engineers’ and attorneys’ fees and expenses, and the cost of litigation) arising from
the presence of hazardous materials on the Hotel premises or in the Hotel. All costs and expenses of the removal of hazardous materials pursuant to this Section 22.09 C, and of compliance with all environmental laws, and any amounts paid to
Management Company pursuant to the indemnity set forth above, shall be paid by Owner from its own funds, not as a Deduction nor from the Reserve. 
 22.10 Equity and Debt Offerings 
 Neither Owner nor Management Company (as an “issuing
party”) shall make reference to the other party (the “non-issuing party) or any of its Affiliates in any prospectus, private placement memorandum, offering circular or offering documentation related thereto (collectively referred to as the
“Prospectus”), issued by the issuing party, unless the non-issuing party has received a copy of all such references. In no event will the non-issuing party be deemed a sponsor of the offering described in any such Prospectus, nor will it
have any responsibility for the Prospectus, and the Prospectus will so state. The issuing party shall be entitled to include in the Prospectus an accurate summary of this Agreement but shall not include any proprietary mark of the non-issuing party
without prior written consent of the non-issuing party. The issuing party shall indemnify, defend and hold the non-issuing party and its Affiliates (and their respective directors, officers, shareholders, employees and agents) harmless from and
against all loss, costs, liability and damage (including attorneys’ fees and expenses, and the cost of litigation) arising out of any Prospectus or the offering described therein. 
  

 -47- 

 22.11 Intentionally Deleted 
 22.12 Estoppel Certificates 
 Owner and Management Company will, at any time and from time to time within fifteen (15) days of the request of the other party or a Qualified Lender, execute, acknowledge, and deliver to the other party and such Qualified Lender, if
any, and any other person the requesting party may reasonably request, a certificate certifying: 
  

	 	A.	That the Agreement is unmodified and in full force and effect (or, if there have been modifications, that the same is in full force and effect as modified and stating such
modifications); 

  

	 	B.	The dates, if any, on which the distributions of Operating Profit have been paid; 

  

	 	C.	Whether there are any existing Defaults by the other party to the knowledge of the party making such certification, and specifying the nature of such Defaults, if any; and

  

	 	D.	Such other matters as may be reasonably requested. 

 Any
such certificates may be relied upon by any party to whom the certificate is directed. 
 22.13 Entire Agreement

 This Agreement, together with other writings signed by the parties expressly stated to be supplementary hereto and together with any
instruments to be executed and delivered pursuant to this Agreement, constitutes the entire agreement between the parties and supersedes all prior understandings and writings, and may be changed only by a writing signed by the parties hereto. This
instrument may be executed in counterparts, each of which shall be deemed an original and all such counterparts together shall constitute one and the same instrument. 
 1.0 Limitation on Liability. 
 Notwithstanding anything to the contrary contained in this Agreement, Owner’s liability under this Agreement shall be limited solely to its interest in the Hotel and no personal liability or deficiency judgment shall append to Owner
relative to, or as result of, this Agreement. 
  

 -48- 

 22.15 Confidentiality. 
 Owner and Management Company agree that the matters set forth in this Agreement are strictly confidential and each party will make every effort to ensure
that the information is not disclosed to any outside person or entities (including any announcements to the press or otherwise pertaining to the transaction entered into by the parties hereunder without the approval as to both timing of any such
announcement of both Owner and Management Company) without the prior written consent of the other party except as may be reasonably necessary to obtain licenses, permits and other public approvals necessary for the operation of the Hotel, in
connection with the Owner’s financing of the Hotel, or the Sale of Hotel. It is understood and agreed that this Section 22.15 is not intended to prohibit or limit disclosure of the matters set forth in this Section 22.15 by Owner or
Management Company (i) to their respective officers, directors, employees, financial advisors, attorneys, accountants, potential lenders, consultants and representatives on a need to know basis, (ii) as required by any governmental agency
or any federal or state law or regulation, or (iii) as required pursuant to the rules of any exchange or securities system on which such party’s (or any of its affiliates’) shares are traded, or (iv) the extent legally compelled
by legal process. 
 22.16 Affiliates. 
 Management Company shall be entitled to contract with one or more of its Affiliates to provide goods and/or services to the Hotel only if the prices and/or fees paid to any such Affiliates are competitive with the
prices and/or fees currently being paid to reputable and qualified parties providing similar services which are not Affiliates of Management Company, provided, however, that in any event Management Company shall be required to obtain Owner’s
consent prior to contracting with any of Management Company’s Affiliates, which consent shall not be unreasonable withheld or delayed. In connection with obtaining such consent, Management Company shall provide Owner with underlying
documentation reasonably necessary for Owner to determine whether such prices and/or fees are competitive with the prices and/or fees currently being paid to reputable and qualified parties providing similar services which are not Affiliates of
Management Company. To the extent that any such services shall constitute the Group Services, the prices and/or fees for such services will be determined pursuant to Section 11.03 B. In the event that the Annual Operating Projection includes
fees to be paid to any Affiliate for the provision of goods and services to the Hotel, Management Company shall provide Owner with underlying documentation reasonably necessary for Owner to determine whether such prices and/or fees are competitive
with the prices and/or fees currently being paid to reputable and qualified parties providing similar services which are not Affiliates of Management Company. 
  

 -49- 

 22.17 Force Majeure 
 In the event either party is unable to perform its obligations hereunder due to an event of Force Majeure, such performance shall be extended for a period of time reasonably required to complete performance of such
obligation(s). 
 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their duly authorized officers.

  

	
	OWNER:
	
	  

	By:
	Title:
	
	MANAGEMENT COMPANY:
	CRESTLINE HOTELS & RESORTS, INC.
	
	  

	By:
	Title:

  

 -50- 

 Exhibit A 
 Legal Description of Hotel Site 
  

 -51- 

 Exhibit B 
 Proforma 
  

 -52- 

 Exhibit C 
 Hotel’s Competitive Set 
  

 -53-Exhibit 10.13

 Exhibit 10.13 
 LEASE AGREEMENT 
 DATED AS OF
                         
 BETWEEN 
  

 AS LESSOR 
 AND 
  

 AS LESSEE 

 LEASE AGREEMENT 
 THIS LEASE AGREEMENT (hereinafter called “Lease”), made as of the          day of
            , 2006, by and between
                                        ,
a                                         
(hereinafter called “Lessor”), and
                                        
            , a                      corporation (hereinafter called
“Lessee”), provides as follows. 
 W I T N E S S E T H: 
 Lessor owns fee title to the Leased Property (as defined below) and desires to lease to Lessee, and Lessee desires to lease from Lessor, the Leased
Property on the terms set forth herein. 
 NOW, THEREFORE, Lessor and Lessee, intending to be legally bound, agree that Lessor, in
consideration of the payment of rent by Lessee to Lessor, the covenants and agreements to be performed by Lessee, and upon the terms and conditions hereinafter stated, does hereby rent and lease unto Lessee, and Lessee does hereby rent and lease
from Lessor, the Leased Property (as defined below). 
 ARTICLE I 
 Section 1.1. Leased Property. 
 The Leased Property is comprised of all of Lessor’s right, title and interest in the following: 
 (a) a parcel or parcels of
land or ground leasehold interest described on Exhibit A attached hereto and by reference incorporated herein (the “Land”); 
 (b)
all buildings, structures and other improvements of every kind including, but not limited to, alleyways and connecting tunnels, sidewalks, utility pipes, conduits and lines (on-site and offsite), parking areas and roadways appurtenant to such
buildings and structures presently situated upon the Land (collectively, the “Leased Improvements”); 
 (c) all easements, rights
and appurtenances relating to the Land and the Leased Improvements; 
 (d) all equipment, machinery, fixtures, and other items of property
required for or incidental to the use of the Leased Improvements as a hotel, including all components thereof, now and hereafter permanently affixed to or incorporated into the Leased Improvements, including, without limitation, all furnaces,
boilers, heaters, electrical equipment, heating, plumbing, lighting, ventilating, refrigerating, incineration, air and water pollution control, waste disposal, air-cooling and air-conditioning systems and apparatus, sprinkler systems and fire and

 theft protection equipment, all of which to the greatest extent permitted by law are hereby deemed by the parties hereto
to constitute real estate, together with all replacements, modifications, alterations and additions thereto (collectively, the “Fixtures”); 
 (e) all furniture and furnishings and all other items of personal property (excluding Inventory and personal property owned by Lessee) located on, and used in connection with, the operation of the Leased Improvements
as a hotel, together with all replacements, modifications, alterations and additions thereto; 
 (f) all existing leases of space within the
Leased Property (including any security deposits or collateral held by Lessor pursuant thereto); 
 (g) all contracts for the use and
occupancy of the guest rooms and/or the meeting, dining, banquet, and spa and health facilities of the Leased Property; 
 (h) all service
and maintenance contracts, equipment leases, purchase orders and other contracts pertaining to the ownership, maintenance, operation, provisioning equipping of the Leased Property, including warranties and guaranties relating thereto; 
 (i) all licenses and permits used in or relating to the ownership, occupancy or operation of any part of the Leased Property; and 
 (j) the rights of Lessor in any Franchise Agreement with respect to the Leased Improvements. 
 For all purposes hereunder, the term “Leased Property” shall mean the specific parcel or parcels of Land together with all items of property
described in Section 1.1(b) through (j) above relating to said parcel or parcels of land. 
 THE LEASED PROPERTY IS DEMISED IN ITS PRESENT
CONDITION WITHOUT REPRESENTATION OR WARRANTY (EXPRESSED OR IMPLIED) BY LESSOR AND SUBJECT TO ALL THE RIGHTS OF PARTIES IN POSSESSION, AND TO THE EXISTING STATE OF TITLE INCLUDING ALL COVENANTS, CONDITIONS, RESTRICTIONS, EASEMENTS AND OTHER MATTERS
OF RECORD INCLUDING ALL APPLICABLE LEGAL REQUIREMENTS, THE LIEN OF FINANCING INSTRUMENTS, MORTGAGES, DEEDS OF TRUST AND SECURITY DEEDS, AND INCLUDING OTHER MATTERS WHICH WOULD BE DISCLOSED BY AN INSPECTION OF THE LEASED PROPERTY OR BY AN ACCURATE
SURVEY THEREOF. 
 Section 1.2. 
 The term of the Lease (the “Term”) is set forth on Exhibit B attached hereto. 
  

 2 

 ARTICLE II 
 Section 2.1. Definitions. 
 For all purposes of this Lease, except as otherwise expressly
provided or unless the context otherwise requires, (a) the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular, (b) all accounting terms not otherwise defined
herein have the meanings assigned to them in accordance with generally accepted accounting principles as are at the time applicable, (c) all references in this Lease to designated “Articles,” “Sections” and other
subdivisions are to the designated Articles, Sections and other subdivisions of this Lease and (d) the words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Lease as a whole and
not to any particular Article, Section or other subdivision. 
 Section 2.2. Additional Charges. 
 As defined in Section 3.3. 
 Section 2.3. Affiliate. 
 As used in this Lease, the term “Affiliate” of a person shall mean (a) any
person that, directly or indirectly, controls or is controlled by or is under common control with such person, (b) any other person that owns, beneficially, directly or indirectly, five percent (5%) or more of the outstanding capital
stock, shares or equity interests of such person, or (c) any officer, director, employee, partner or trustee of such person or any person controlling, controlled by or under common control with such person (excluding trustees and persons
serving in similar capacities who are not otherwise an Affiliate of such person). The term “person” means and includes individuals, corporations, general and limited partnerships, stock companies or associations, joint ventures,
associations, companies, trusts, banks, trust companies, land trusts, business trusts, or other entities and governments and agencies and political subdivisions thereof. For the purposes of this definition, “control” (including the
correlative meanings of the terms “controlled by” and “under common control with”), as used with respect to any person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the
management and policies of such person, through the ownership of voting securities, partnership interests or other equity interests. 
 Section 2.4. Annual Budget. 
 As used in this Lease, the term “Annual Budget” shall mean an operating and
capital budget prepared by Lessee and delivered to Lessor in accordance with Section 3.6. 
 Section 2.5. Award. 

As defined in Section 15.1(c). 
  

 3 

 Section 2.6. Base Rate. 
 The prime rate of interest announced publicly by Citibank, N.A., in New York, New York, from time to time. If no such rate is announced or becomes
discontinued, then such rate as is published in The Wall Street Journal as the prime rate from time to time. 
 Section 2.7.
Base Rent. 
 As defined in Article III. 
 Section 2.8. Beverage Revenues: Gross revenue from (i) the sale of wine, beer, liquor or other alcoholic beverages, whether sold in the bar or lounge, delivered to a guest room, sold at meetings or
banquets or at any other location at the Leased Property or (ii) non-alcoholic beverages sold in the bar or lounge. Such revenues shall not include the following: 
 (a) Any gratuity or service charge added to a customer’s bill or statement in lieu of a gratuity which is paid to an employee; 
 (b) Credits, rebates, or refunds; and 
 (c) Sales taxes or taxes of any other kind imposed on the sale of
alcoholic or other beverages. 
 Section 2.9. Intentionally Deleted. 
 Section 2.10. Business Day. 
 Each Monday, Tuesday, Wednesday, Thursday and Friday that is not a day on which national banks in the City of New York, New York, or in the municipality wherein the applicable Leased Property is located are closed. 
 Section 2.11. Capital Expenditures. 
 As used in this Lease, the term “Capital Expenditures” shall mean expenditures for capital improvements to the Leased Property and replacement or refurbishing of the Improvements, Fixtures, Furniture and Equipment and of other
equipment and systems that constitute portions of the Leased Property in connection with its Primary Intended Use, and the cost of all approvals, licenses, permits and other authorizations necessary to complete such improvements, replacements and
refurbishings, all as designated as capital improvements by and determined in accordance with generally accepted accounting principles. 
 Section 2.12. Capital Impositions. 
 Taxes, assessments or similar charges imposed upon or levied against the Leased
Property for the costs of public improvements, including, without limitation, roads, sidewalks, public lighting fixtures, utility lines, storm sewers, drainage facilities and similar improvements. 
  

 4 

 Section 2.13. CERCLA. 
 The Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended. 
 Section 2.14. Code. 
 The
Internal Revenue Code of 1986, as amended. 
 Section 2.15. Commencement Date. 
 As defined on Exhibit B. 
 Section 2.16.
Condemnation, Condemnor. 
 As defined in Section 15.1. 
 Section 2.17. Consolidated Financials. 
 For any fiscal year or other accounting period for Lessee and its consolidated subsidiaries, statements of earnings and retained earnings and cash flow and for the period from the beginning of the respective fiscal year to the end of such
period and the related balance sheet as at the end of such period, together with the notes thereto, all in reasonable detail and setting forth in comparative form the corresponding figures for the corresponding period in the preceding fiscal year,
and prepared in accordance with generally accepted accounting principles and certified by Lessee’s Chief Accounting Officer. 
 Section 2.18. CPI. 
 The “Consumer Price Index” published by the Bureau of Labor Statistics of the United
States Department of Labor, U.S. City Average, All Items for Urban Wage Earners and Clerical Workers (1982-1984=100). 
 Section 2.19.
Date of Taking. 
 As defined in Section 15.1(b). 
 Section 2.20. Eligible Independent Contractor. 
 A management company that meets all of the
following requirements: 
 (a) The management company does not own, directly or indirectly, more than 35% of the outstanding stock of Highland
Hospitality Corporation. 
 (b) If the management company is a corporation, no more than 35% of the total combined voting power of its
outstanding stock (or 35% of the total shares of all classes of its outstanding stock) or, if it is not a corporation, no more than 35% of the ownership interest in its assets or net profits is owned, directly or indirectly, by one or more Persons
owning 35% or more of the outstanding stock of Highland Hospitality Corporation. 
  

 5 

 (c) Neither Highland Hospitality Corporation, Lessor, Lessee, nor any Affiliate thereof derives any
income from the management company. 
 (d) At the time that the management company enters into a management agreement with Lessee to operate
the Leased Property, the management company (or any “related person” within the meaning of Section 856(d)(9)(F) of the Code) is actively engaged in the trade or business of operating “qualified lodging facilities” within the
meaning of Section 856(d)(9)(D) of the Code for any Person who is not a “related person” within the meaning of Section 856(d)(9)(F) of the Code with respect to Highland Hospitality Corporation or Lessee (an “Unrelated
Person”). For purposes of determining whether the requirement of this paragraph (d) has been met, a management company shall be treated as being actively engaged in such a trade or business if the management company (i) derives at
least 10% of both its profits and revenue from operating “qualified lodging facilities” within the meaning of Section 856(d)(9)(D) of the Code for Unrelated Persons or (ii) complies with any regulations or other administrative
guidance under Section 856(d)(9) of the Code that provide a “safe harbor “ rule with respect to the amount of hotel management business with Unrelated Persons that is necessary to qualify as an “eligible independent
contractor” within the meaning such Code section. 
 Section 2.21. Encumbrance. 
 As defined in Article XXXIV. 
 Section 2.22. Environmental Authority. 
 Any department, agency or other body or component of any Government that
exercises any form of jurisdiction or authority over Lessor, Lessee or the Leased Property under any Environmental Law. 
 Section 2.23.
Environmental Authorization. 
 Any license, permit, order, approval, consent, notice, registration, filing or other form of permission
or authorization required under any Environmental Law. 
 Section 2.24. Environmental Laws. 
 All applicable federal, state, local and foreign laws and regulations relating to the environment (including without limitation, ambient air, surface
water, ground water, land surface or subsurface strata), including without limitation laws and regulations relating to emissions, discharges, Releases or threatened Releases of Hazardous Materials or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials and laws relating to health or safety. Environmental Laws include but are not limited to CERCLA, FIFRA, RCRA, SARA, OSHA and TSCA. 

 

 6 

 Section 2.25. Environmental Liabilities. 
 Any and all obligations to pay the amount of any judgment or settlement, the cost of complying with any settlement, judgment or order for injunctive or
other equitable relief, the cost of compliance or corrective action in response to any notice, demand or request from an Environmental Authority, the amount of any civil penalty or criminal fine, and any court costs and reasonable amounts for
attorney’s fees, fees for witnesses and experts, and costs of investigation and preparation for defense of any claim or any Proceeding, regardless of whether such Proceeding is threatened, pending or completed, that may be or have been asserted
against or imposed upon Lessor, Lessee, any Predecessor, the Leased Property or any property used therein and arising out of: 
 (a) Failure
of Lessee, Lessor, any Predecessor or the Leased Property to comply at any time with all Environmental Laws; 
 (b) Presence of any Hazardous
Materials in excess of allowable limits under any Environmental Laws on, in, under, at or in any way affecting the Leased Property; 
 (c) A
Release at any time of any Hazardous Materials on, in, at, under or in any way affecting the Leased Property; 
 (d) Identification by an
Environmental Authority of Lessee, Lessor or any Predecessor as a potentially responsible party under CERCLA or under any Environmental Law similar to CERCLA; 
 (e) Presence at any time of any above-ground and/or underground storage tanks, as defined in RCRA or in any applicable Environmental Law on, in, at or under the Leased Property or any adjacent site or facility; or

 (f) Any and all claims for injury or damage to persons or property arising out of exposure to Hazardous Materials originating or located
at the Leased Property, or resulting from operation thereof or any adjoining property. 
 Section 2.26. Event of Default.

 As defined in Section 16.1. 
 Section 2.27. Existing Leases. 
 As defined in the preamble on page 1. 
 Section 2.28. Fair Market Rental. 
 The fair market rental of the Leased Property means the rental which a willing tenant not compelled to rent would pay a willing landlord not compelled to lease for the use and occupancy of the Leased Property pursuant to the Lease for the
Term in question, (a) assuming that Lessee is not in default thereunder and (b) determined in accordance with the appraisal procedures set forth in Article XXXIII or in such other manner as shall be mutually acceptable to Lessor and
Lessee. 
  

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 Section 2.29. Fair Market Value. 
 The fair market value of Lessee’s leasehold interest in the Leased Property or of any other property means an amount equal to the price that a
willing buyer not compelled to buy would pay a willing seller not compelled to sell for such property, (a) determined in accordance with the appraisal procedures set forth in Article XXXIII or in such other manner as shall be mutually
acceptable to Lessor and Lessee, (b) assuming that such seller must pay any customary closing costs and title premiums, and (c) taking into account the positive or negative effect on the value of the property attributable to the interest
rate, amortization schedule, maturity date, prepayment penalty and other terms and conditions of any encumbrance that is assumed by the transferee. 
 Section 2.30. FIFRA. 
 The Federal Insecticide, Fungicide, and Rodenticide Act, as amended. 
 Section 2.31. Fiscal Year. 
 The
12-month period from January 1 to December 31. 
 Section 2.32. Fixtures. 
 As defined in Section 1.1. 
 Section 2.33. Food Revenues. Gross revenue from the sale, for on-site consumption, of food and non-alcoholic beverages sold at the Leased Property, including in respect to guest rooms, banquet rooms, meeting rooms and other
similar rooms. Such revenues shall not include the following: 
 (a) Vending machine sales; 
 (b) Any gratuities or service charges added to a customer’s bill or statement in lieu of a gratuity which is paid to an employee; 
 (c) Non-alcoholic beverages sold in the bar or lounge; and 
 (d) Sales taxes or taxes of any other kind imposed on the sale of food or non-alcoholic beverages. 
  

 8 

 Section 2.34. Intentionally Deleted. 
 Section 2.35. Franchise Agreement. 
 Any franchise agreement or license agreement with a franchisor under which the Hotel is operated. 
 Section 2.36. Furniture
and Equipment. 
 For purposes of this Lease, the terms “furniture and equipment” shall mean collectively all furniture,
furnishings, wall coverings, fixtures and hotel equipment and systems located at, or used in connection with, the Hotel, together with all replacements therefor and additions thereto, including, without limitation, (i) all equipment and systems
required for the operation of kitchens and bars, if any, laundry and dry cleaning facilities, (ii) office equipment, (iii) dining room wagons, materials handling equipment, cleaning and engineering equipment, (iv) telephone and
computerized accounting systems, and (v) vehicles. 
 Section 2.37. Government. 
 The United States of America, any state, district or territory thereof, any foreign nation, any state, district, department, territory or other political
division thereof, or any political subdivision of any of the foregoing. 
 Section 2.38. Gross Operating Expenses. 
 For purposes of this Lease, the term “Gross Operating Expenses” with respect to the Leased Property shall mean the “Deductions” as
defined in the Management Agreement. 
 Section 2.39. Gross Operating Profit. 
 Gross Operating Profit with respect to the Leased Property shall mean, for any Fiscal Year, the excess of Gross Revenues for such Fiscal Year over Gross
Operating Expenses for such Fiscal Year. 
 Section 2.40. Gross Revenues. 
 As set forth in the Management Agreement. 
 Section 2.41. Hazardous Materials. 
 Hazardous Materials shall mean and include: 
 (a) Solid, gaseous, or liquid wastes (including hazardous wastes), hazardous air pollutants, hazardous substances, hazardous materials, regulated
substances, restricted hazardous wastes, hazardous chemical substances, mixtures, toxic substances, pollutants or contaminants or terms of similar import as such terms are defined in any Environmental Law as such definition may change from time to
time; 
  

 9 

 (b) Any substance or material which now or in the future is known to constitute a threat to health,
safety, property or the environment or which has been or in the future is determined by an Environmental Authority to be capable of posing a risk of injury to health, safety, property or the environment or exposure to which is prohibited, limited or
regulated by any Environmental Law or any Environmental Authority, including all of those materials, wastes and substances designated now or in the future as hazardous or toxic by any Environmental Authority; and 
 (c) Any petroleum, or petroleum products or byproducts, radioactive materials, polychlorinated biphenols, asbestos, whether friable or non-friable, and
urea formaldehyde foam insulation or radon gas. 
 Section 2.42. Hotel. 
 The hotel and/or other facilities offering lodging and other services or amenities being operated or proposed to be operated on the Leased Property as
listed on Exhibit A attached hereto. 
 Section 2.43. Impositions. 
 Collectively, all taxes (including, without limitation, all ad valorem, sales and use, single business, gross receipts, transaction privilege, rent or
similar taxes as the same relate to or are imposed upon Lessee or its business conducted upon the Leased Property), assessments (including, without limitation, all assessments under private covenants and for public improvements or benefit, whether
or not commenced or completed prior to the date hereof and whether or not to be completed within the Term), water, sewer or other rents and charges, excises, tax inspection, authorization and similar fees and all other governmental charges, in each
case whether general or special, ordinary or extraordinary, or foreseen or unforeseen, of every character in respect of the Leased Property or the business conducted thereon by Lessee (including all interest and penalties thereon caused by any
failure in payment by Lessee), which at any time prior to, during or with respect to the Term hereof may be assessed or imposed on or with respect to or be a lien upon (a) Lessor’s interest in the Leased Property, (b) the Leased
Property, or any part thereof or any rent therefrom or any estate, right, title or interest therein, or (c) any occupancy, operation, use or possession of, or sales from, or activity conducted on or in connection with the Leased Property, or
the leasing or use of the Leased Property or any part thereof by Lessee. Nothing contained in this definition of Impositions shall be construed to require Lessee to pay (1) any tax based on net income (whether denominated as a franchise or
capital stock or other tax) imposed on Lessor or any other person, or (2) any net revenue tax of Lessor or any other person, or (3) any tax imposed with respect to the sale, exchange or other disposition by Lessor of the Leased Property or
the proceeds thereof, or (4) any single business, gross receipts (other than a tax on any rent received by Lessor from Lessee), transaction, privilege or similar taxes as the same relate to or are imposed upon Lessor, except to the extent that
any tax, assessment, tax levy or charge that Lessee is obligated to pay pursuant to the first sentence of this definition and that is in effect at any time during the Term hereof is totally or partially repealed, and a tax, assessment, tax levy or
charge set forth in clause (1) or (2) is levied, assessed or imposed expressly in lieu thereof. 
  

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 Section 2.44. Indemnified Party. 
 Either of a Lessee Indemnified Party or a Lessor Indemnified Party. 
 Section 2.45. Indemnifying Party. 
 Any party obligated to indemnify an Indemnified Party
pursuant to Section 8.3 or Article XXII. 
 Section 2.46. Insurance Requirements. 
 All terms of any insurance policy required by this Lease and all requirements of the issuer of any such policy. 
 Section 2.47. Inventory. 
 All
“Inventories of Merchandise” and “Inventories of Supplies” as defined in the Uniform System, including, but not limited to, linens and other non-depreciable personal property. 
 Section 2.48. Land. 
 As defined
in Article I. 
 Section 2.49. Lease. 
 This Lease. 
 Section 2.50. Leased Improvement, Leased Property. 
 Each as defined in Article I. 
 Section 2.51. Legal Requirements. 
 All federal, state, county, municipal and other governmental statutes, laws, rules,
orders, regulations, ordinances, judgments, decrees and injunctions affecting either the Leased Property or the maintenance, construction, use or alteration thereof (whether by Lessee or under Lessee’s control), whether or not hereafter enacted
and in force, including (a) all laws, rules or regulations pertaining to the environment, occupational health and safety and public health, safety or welfare, and (b) any laws, rules or regulations that may (1) require repairs,
modifications or alterations in or to the Leased Property or (2) in any way adversely affect the use and enjoyment thereof; and all permits, licenses and authorizations and regulations relating thereto and all covenants, agreements,
restrictions and encumbrances contained in any instruments, either of record or known to Lessee (other than encumbrances created by Lessor without the consent of Lessee), at any time in force affecting the Leased Property. 
  

 11 

 Section 2.52. Lending Institution. 
 Any insurance company, credit company, federally insured commercial or savings bank, national banking association, savings and loan association, employees
welfare, pension or retirement fund or system, corporate profit sharing or pension trust, college or university, or real estate investment trust, including any corporation qualified to be treated for federal tax purposes as a real estate investment
trust, such trust having a net worth of at least $10,000,000. 
 Section 2.53. Lessee. 
 The Lessee designated on this Lease and its respective permitted successors and assigns. 
 Section 2.54. Lessee Indemnified Party. 
 Lessee, any Affiliate of Lessee, any other Person against whom any claim for indemnification may be asserted hereunder as a result of a direct or indirect ownership interest (including a stockholder’s interest) in Lessee, the officers,
directors, partners, members, stockholders, employees, agents and representatives of Lessee and any corporate stockholder, agent, or representative of Lessee, and the respective heirs, personal representatives, successors and assigns of any such
officer, director, partner, member, stockholder, employee, agent or representative. 
 Section 2.55. Lessee’s Personal
Property. 
 As defined in Section 6.2. 
 Section 2.56. Lessor. 
 The Lessor designated on this Lease and its respective successors and
assigns. 
 Section 2.57. Lessor Indemnified Party. 
 Lessor, any Affiliate of Lessor, any other Person against whom any claim for indemnification may be asserted hereunder as a result of a direct or indirect ownership interest (including a stockholder’s or
partnership interest) in Lessor, the officers, directors, partners, members, stockholders, employees, agents and representatives of the general partner of Lessor and any partner, agent, or representative of Lessor, and the respective heirs, personal
representatives, successors and assigns of any such officer, director, partner, member, stockholder, employee, agent or representative. 
  

	Section	2.58. Management Agreement. 

 The agreement pursuant to
which the Manager operates the Leased Property. Initially, the Management Agreement shall mean the Management Agreement dated
                    , 200    , between Lessee and
                                     as it may be amended or
supplemented from time to time. 
  

 12 

 Section 2.59. Manager. 
 As defined in Section 19.3. 
 Section 2.60. Notice. 
 A notice given pursuant to Article XXXII. 
 Section 2.61. Officer’s Certificate. 
 A certificate of Lessee reasonably acceptable to Lessor, signed by the chief accounting officer or another officer authorized so to sign by the board of directors or by-laws of Lessee, or any other person whose power
and authority to act has been authorized by delegation in writing by any such officer. 
 Section 2.62. OSHA 
 The Occupational Health and Safety Act, as amended. 
 Section 2.63. Overdue Rate. 
 On any date, a rate equal to the Base Rate plus 2% per annum, but in no event greater
than the maximum rate then permitted under applicable law. 
 Section 2.64. Payment Date. 
 Any due date for the payment of any installment of Base Rent. 
 Section 2.65. Percentage Rent. 
 As defined in Section 3.1(b). 
 Section 2.66. Person. 
 Any
Government, natural person, corporation, general or limited partnership, limited liability company, stock company or association, joint venture, association, company, trust, bank, trust company, land trust, business trust, or other entity.

 Section 2.67. Personal Property Taxes. 
 All personal property taxes imposed on the furniture, furnishings or other items of personal property located on, and used in connection with, the operation of the Leased Improvements as a hotel (including all
Inventory and other personal property owned by Lessee), together with all replacement, modifications, alterations and additions thereto. 
  

 13 

 Section 2.68. Predecessor. 
 Any Person whose liabilities arising under any Environmental Law have or may have been retained or assumed by Lessee, either contractually or by operation
of law, relating to the Leased Property. 
 Section 2.69. Primary Intended Use. 
 As defined in Section 7.2(b). 
 Section 2.70. Proceeding. 
 Any judicial action, suit or proceeding (whether civil or criminal), any administrative
proceeding (whether formal or informal), any investigation by a governmental authority or entity (including a grand jury), and any arbitration, mediation or other non-judicial process for dispute resolution. 
 Section 2.71. Quarterly Revenues Computations. 
 As defined in Exhibit C attached hereto. 
 Section 2.72. RCRA. 
 The Resource Conservation and Recovery Act, as amended. 
 Section 2.73. Real Estate Taxes. 
 All real estate taxes, including general and special
assessments, if any, which are imposed upon the Land, and any improvements thereon. 
 Section 2.74. Release. 
 A “Release” as defined in CERCLA or in any Environmental Law, unless such Release has been properly authorized and permitted in writing by all
applicable Environmental Authorities or is allowed by such Environmental Law without authorizations or permits. 
 Section 2.75.
Rent. 
 Collectively, the Base Rent, Percentage Rent and Additional Charges. 
 Section 2.76. Room Revenues. 
 Gross Revenue from the rental of guestrooms, whether to individuals, groups or transients, at the Hotel, excluding the following: 
 (a) the amount of all credits, rebates or refunds to customers, guests or patrons; 
  

 14 

 (b) all sales taxes or any other taxes imposed on the rental of such guest rooms; 
 (c) any fees collected for amenities including, but not limited to: telephone, laundry, movies or concessions; and 
 (d) accounts receivable that previously have been included in Room Revenues but which have remained uncollected for at least 180 days and have become, in
the reasonable judgment of Lessee, uncollectable. 
 Section 2.77. SARA. 
 The Superfund Amendments and Reauthorization Act of 1986, as amended. 
 Section 2.78. State. 
 The State or Commonwealth of the United States in which the Leased
Property is located. 
 Section 2.79. Subsidiaries. 
 Persons in which a party owns, directly or indirectly, more than 50% of the voting stock or control, as applicable (individually, a “Subsidiary”). 
 Section 2.80. Taking. 
 A taking
or voluntary conveyance during the Term of all or part of the Leased Property, or any interest therein or right accruing thereto or use thereof, as the result of, or in settlement of, any Condemnation or other eminent domain proceeding affecting the
Leased Property whether or not the same shall have actually been commenced. 
 Section 2.81. Term. 
 As defined in Section 1.2. 
 Section 2.82. TSCA. 
 The Toxic Substances Control Act, as amended. 
 Section 2.83. Uneconomic for its Primary Intended Use. 
 A state or condition of the Leased Property such that, in the good faith judgment of Lessee, reasonably exercised and evidenced by the resolution of the board of directors or other governing body of Lessee, the Leased
Property cannot be operated on a commercially practicable basis for its Primary Intended Use, taking into account, among other relevant factors, the number of usable rooms and projected revenues, such that Lessee intends to, and shall, complete the
cessation of operations from the Leased Property. 
  

 15 

 Section 2.84. Uniform System. 
 Shall mean the Uniform System of Accounts for Hotels (9th Revised Edition, 1996) as published by the Hotel Association of New York City, Inc., as same may
hereafter be revised. 
 Section 2.85. Unsuitable for its Primary Intended Use. 
 A state or condition of the Leased Property such that, in the good faith judgment of Lessee, reasonably exercised and evidenced by the resolution of the
board of directors or other governing body of Lessee, due to casualty damage or loss through Condemnation, the Leased Property cannot function as an integrated hotel facility consistent with standards applicable to a well maintained and operated
hotel. 
 ARTICLE III 
 Section 3.1. Rent. 
 Lessee will pay to Lessor in lawful money of the United States of America which shall be legal
tender for the payment of public and private debts, in immediately available funds, at Lessor’s address set forth in Article XXXII hereof or at such other place or to such other Person, as Lessor from time to time may designate in a Notice, all
Base Rent, Percentage Rent and Additional Charges, during the Term, as follows: 
 (a) Base Rent: An annual sum in the amount set forth
on Exhibit C hereto as the “Base Rent” for the Leased Property, payable in arrears in equal, consecutive monthly installments, on or before the fifteenth day of each calendar month during the Term; provided, however, that the first and
last monthly payments of Base Rent shall be pro rated as to any partial month (subject to adjustment as provided in Sections 5.2, 14.5, 15.3, 15.5, and 15.6); and 
 (b) Percentage Rent: For each Fiscal Year during the Term commencing with the Fiscal year in which the Commencement Date occurs, Tenant shall pay percentage rent (“Percentage Rent”) quarterly, on or
before the fifteenth day following the end of each calendar quarter in each Fiscal Year, in an amount calculated by the following formula: 
 The amount equal to the Quarterly Revenues Computation 
 less 
 an amount equal to the Base Rent paid year to date for the applicable Fiscal Year 
 less 
 an amount equal to Percentage Rent paid year to date for the
applicable Fiscal Year 
 equals 
 Percentage Rent for the applicable quarter. 
  

 16 

 In the event the Term begins and ends in the middle of a Fiscal Year, the foregoing formula shall be
applied as if the first Fiscal Year had only the number of calendar quarters within the initial Fiscal Year which are within the Term and the last Fiscal Year had only the number of calendar quarters within the last Fiscal Year which are within the
Term. If less than all of a calendar quarter falls within the Term, the Percentage Rent for that quarter shall equal (i) the Percentage Rent calculated as indicated above multiplied by (ii) a fraction equal to (A) the number of days
in the quarter that fall within the Term divided by (B) the total number of days in the quarter. 
 The Base Rents and Percentage Rent
threshold amounts contained on Exhibit C shall be adjusted at the end of each Fiscal Year based upon the adjustments to the CPI pursuant to Section 3.1(d), if any. 
 (c) Officer’s Certificates. Additionally, if requested by Lessor, an Officer’s Certificate shall be delivered to Lessor quarterly, together with such quarterly Percentage Rent payment, setting forth
the calculation of such rent payment for such quarter within 15 days after each of the first three quarters of each Fiscal Year (or part thereof) in the Term. Such quarterly payments shall be based on the formula set forth in Section 3.1(b).
There shall be no reduction in the Base Rent regardless of the result of the Quarterly Revenues Computations. 
 In addition, on or before
March 5th of each year, if requested by Lessor, Lessee shall deliver to Lessor an Officer’s Certificate reasonably acceptable to Lessor setting forth the computation of the actual Percentage Rent that accrued for each quarter of the Fiscal
Year that ended on the immediately preceding December 31 and shall pay to Lessor Percentage Rent, if due and payable, for the last quarter of the applicable Fiscal Year. Additionally, if the annual Percentage Rent due and payable for any Fiscal
Year (as shown in the applicable Officer’s Certificate) exceeds the amount actually paid as Percentage Rent by Lessee for such year, Lessee also shall pay such excess to Lessor at the time such certificate is delivered. If the Percentage Rent
actually due and payable for such Fiscal Year is shown by such certificate to be less than the amount actually paid as Percentage Rent for the applicable Fiscal Year, Lessor shall reimburse such amount to Lessee or alternatively, at the
Lessor’s option, credit such amount against subsequent months’ Base Rent and, to the extent necessary, subsequent quarters’ Percentage Rent payments. Any such credit to Base Rent shall not be applied for purposes of calculating
Percentage Rent payable for any subsequent quarter. 
 Any difference between the annual Percentage Rent due and payable for any Fiscal Year
(as shown in the applicable Officer’s Certificate or as adjusted pursuant to Section 3.3) and the total amount of quarterly payments for such Fiscal Year actually paid by Lessee as Percentage Rent, whether in favor of Lessor or Lessee,
shall bear interest at the Overdue Rate, which interest shall accrue from the due date of the last quarterly payment for the Fiscal Year until the amount of such difference shall be paid or otherwise discharged. Any such interest payable to Lessor
shall be deemed to be and shall be payable as Additional Charges. 
  

 17 

 The obligation to pay Percentage Rent shall survive the expiration or earlier termination of the Term,
and a final reconciliation, taking into account, among other relevant adjustments, any adjustments which are accrued after such expiration or termination date but which related to Percentage Rent accrued prior to such termination date, and
Lessee’s good faith best estimate of the amount of any unresolved contractual allowances, shall be made not later than one year after such expiration or termination date, but Lessee shall advise Lessor within 60 days after such expiration or
termination date of Lessee’s best estimate at that time of the approximate amount of such adjustments, which estimate shall not be binding on Lessee or have any legal effect whatsoever. 
 (d) CPI Adjustments. For each Fiscal Year during the Term beginning January 1, 200_, the Base Rent then in effect, and the quarterly
Percentage Rent threshold amounts then included in the Quarterly Revenues Computations set forth in Section 3.1(b), shall be adjusted as follows: 
 (i) The average CPI for the most recently ended Fiscal Year shall be divided by the average CPI for the immediately preceding Fiscal Year; 
 (ii) The new Base Rent for the then current Fiscal Year shall be the adjusted amount obtained by multiplying the Base Rent for the
immediately preceding Fiscal Year by the quotient obtained under subparagraph (i) above; 
 (iii) The new quarterly and
annual Percentage Rent threshold dollar amounts in the Quarterly Revenues Computation described in Section 3.1(b) above for the then current Fiscal Year shall be the product of the threshold dollar amount of Room Revenues in effect in the most
recently ended Fiscal Year and the quotient obtained in subparagraph (i) above. 
 (iv) The new quarterly and annual
Percentage Rent threshold dollar amounts in the Quarterly Revenues Computation described in Section 3.1(b) above for the then current Fiscal Year shall be the product of the threshold dollar amount of Beverage Revenues and Food Revenues in
effect in the most recently ended Fiscal Year and the quotient obtained in subparagraph (i) above. 
 The amount of any
adjustment under paragraphs (d)(i)-(iv) to Base Rent and the quarterly Percentage Rent threshold amounts for any Fiscal Year shall not exceed     % of the Base Rent and quarterly and annual Percentage Rent threshold
amount applicable for the prior Fiscal Year. 
 By way of example, the Base Rent and the quarterly and annual Percentage Rent
threshold amounts in the Quarterly Revenues Computation for the Fiscal Year commencing January 1, 2005 would be adjusted to reflect any change in the average CPI for the Fiscal Year ended December 31, 2004 as compared to the Fiscal Year
ended December 31, 2003. 
  

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 Adjustments calculated as set forth above in the Base Rent and quarterly and annual
Percentage Rent threshold amounts shall be effective on the first day of each Fiscal Year to which such adjusted amounts apply. If Rent is paid in any period prior to determination of the amount of any adjustment to Base Rent or the quarterly and
annual Percentage Rent threshold applicable for such period, payment adjustments for any shortfall in or overpayment of Rent paid shall be made with the first Base Rent payment due after the amount of the adjustments are determined. 
 The “average CPI” for a Fiscal Year shall be the average of the monthly CPI during the Fiscal Year. 
 (v) If (A) a significant change is made in the number or nature (or both) of items used in determining the CPI, or (B) the CPI
shall be discontinued for any reason, the Bureau of Labor Statistics shall be requested to furnish a new index comparable to the CPI, together with information which will make possible a conversion to the new index in computing the adjusted Base
Rent and adjusted quarterly and annual Percentage Rent threshold amounts hereunder. If for any reason the Bureau of Labor Statistics does not furnish such an index and such information, the parties will instead mutually select, accept and use such
other index or comparable statistics on the cost of living in Washington, D.C. that is computed and published by an agency of the United States or a responsible financial periodical of recognized authority. 
 Section 3.2. Confirmation of Percentage Rent. 
 Lessee shall utilize, or cause to be utilized, an accounting system for the Leased Property in accordance with its usual and customary practices, and in accordance with generally accepted accounting principles and the
Uniform System, that will accurately record all data necessary to compute Percentage Rent, and Lessee shall retain, for at least four (4) years after the expiration of each Fiscal Year (and in any event until the reconciliation described in
Section 3.1(c) for such Fiscal Year has been made), reasonably adequate records conforming to such accounting system showing all data necessary to compute Percentage Rent for the applicable Fiscal Years. Lessor, at its expense (except as
provided herein below), shall have the right from time to time by its accountants or representatives to audit the information that formed the basis for the data set forth in any Officer’s Certificate provided during the preceding four
(4) Fiscal Years under Section 3.1(c) and, in connection with such audits, to examine all Lessee’s records (including supporting data and sales and excise tax returns and franchise reports) reasonably required to verify Percentage
Rent (and for no other purpose), subject to any prohibitions or limitations on disclosure of any such data under Legal Requirements. If any such audit discloses a deficiency in the payment of Percentage Rent, and either Lessee agrees with the result
of such audit or the matter is otherwise determined or compromised, Lessee shall forthwith pay to Lessor the amount of the deficiency, as finally agreed or determined, together with interest at the Overdue Rate from the date when said payment should
have been made to the date of payment thereof; provided, however, that as to any audit that is commenced more than two (2) years after the date Percentage Rent for any Fiscal Year is reported by Lessee to Lessor, the deficiency, if any, with
respect to such Percentage Rent shall bear interest at the Overdue Rate only from the date such determination of deficiency is made unless such deficiency is the result of gross negligence or 
  

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 willful misconduct on the part of Lessee, in which case interest at the Overdue Rate will accrue from the date such
payment should have been made to the date of payment thereof. If any such audit discloses that the Percentage Rent actually due from Lessee for any Fiscal Year exceeds that reported by Lessee by more than 3%, Lessee shall pay the cost of such audit
and examination. Any proprietary information obtained by Lessor pursuant to the provisions of this Section shall be treated as confidential, except that such information may be used, subject to appropriate confidentiality safeguards, in any
litigation between the parties and except further that Lessor may disclose such information to prospective lenders. The obligations of Lessee contained in this Section shall survive the expiration or earlier termination of this Lease.

 Section 3.3. Additional Charges. 
 In addition to the Base Rent and Percentage Rent, (a) Lessee also will pay and discharge as and when due and payable all other amounts, liabilities, obligations and Impositions that Lessee assumes or agrees to
pay under this Lease, and (b) in the event of any failure on the part of Lessee to pay any of those items referred to in clause (a) of this Section 3.3, Lessee also will promptly pay and discharge every fine, penalty, interest and
cost that may be added for non-payment or late payment of such items (the items referred to in clauses (a) and (b) of this Section 3.3 being additional rent hereunder and being referred to herein collectively as the “Additional
Charges”), and Lessor shall have all legal, equitable and contractual rights, powers and remedies provided either in this Lease or by statute or otherwise in the case of non-payment of the Additional Charges as in the case of non-payment of the
Base Rent. If any installment of Base Rent, Percentage Rent or Additional Charges (but only as to those Additional Charges that are payable directly to Lessor) shall not be paid on its due date, Lessee will pay Lessor on demand, as Additional
Charges, a late charge (to the extent permitted by law) computed at the Overdue Rate on the amount of such installment, from the due date of such installment to the date of payment thereof. To the extent that Lessee pays any Additional Charges to
Lessor pursuant to any requirement of this Lease, Lessee shall be relieved of its obligation to pay such Additional Charges to the entity to which they would otherwise be due and Lessor shall pay same from monies received from Lessee. 
 Section 3.4. Rent Payable Without Deduction. 
 The Rent shall be paid so that this Lease shall yield to Lessor the full amount of the installments of Base Rent, Percentage Rent and Additional Charges throughout the Term, all as more fully set forth in Article V,
but subject to any other provisions of this Lease that expressly provide for adjustment or abatement of Rent or other charges or expressly provide that certain expenses or maintenance (not including Real Estate Taxes, Personal Property Taxes and
Capital Impositions) shall be paid or performed by Lessor. In order that the Hotel yield the maximum amount of Rent under this Lease, Lessee does hereby covenant and agree that it shall not barter or trade for goods or services from providers
thereof to the Hotel in exchange for free or reduced rates for guestrooms or other goods and services provided by or at the Hotel for its guests. 
  

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 Section 3.5. Conversion of Property. 
 If, during the Term, Lessee desires to provide food and beverage operations at the Hotel which differ materially from the food and beverage operations
provided at the commencement of the Term (for example, eliminating full service food and beverage operations), Lessee shall give notice of such desire to Lessor. Lessor and Lessee shall then commence negotiations to adjust Rent to reflect the
proposed change to the operation of the Hotel, each acting reasonably and in good faith. All other terms of this Lease will remain substantially the same. During negotiations, which shall not extend beyond 60 days, Lessee shall not
“convert” the Hotel and shall continue fulfilling its obligations under the existing terms of this Lease. If no agreement is reached after such 60-day period, Lessee shall withdraw such notice and this Lease shall continue in full force.

 Section 3.6. Annual Budget. 
 Lessee shall submit to Lessor with respect to the Hotel: 
 (a) An annual operating budget (“Annual
Budget”) delivered at the times and prepared in the manner described in the Management Agreement. 
 (b) A capital budget (“Capital
Budget”) delivered at the times and prepared in the manner described in the Management Agreement. The Capital Budget shall be prepared in accordance with the Uniform System to the extent applicable. 
 Section 3.7. Approval of Capital Budget. 
 Lessor and Lessee shall endeavor in good faith to approve the Capital Budget within the time periods specified in the Management Agreement. Within the time periods specified in the Management Agreement, Lessor shall give Lessee written
notice either (a) that Lessor approves the Capital Budget (which approval may not be unreasonably withheld, conditioned or delayed) or (b) indicating with reasonable specificity the respects in which Lessor objects to the Capital Budget.
In the latter event, Lessor and Lessee shall act promptly, reasonably and in good faith to seek to resolve Lessor’s objections. In the event that Lessor and Lessee fail to reach agreement with respect to the Capital Budget within thirty
(30) days after receipt of Lessor’s written notice, Lessee and Lessor shall refer any disputed Capital Budget matter to arbitration using procedures set forth in Article XXXIX hereto and each party shall endeavor to cause such arbitration
to be completed as quickly as possible, but in any event not later than six (6) months following referral to arbitration. While any arbitration is pending, Lessee shall continue to operate the Hotel in accordance with the terms of this Lease,
including without limitation, making all Capital Expenditures for approved portions of the Capital Budget and mandatory projects to the extent such mandatory projects are included in the Capital Budget. Lessor shall be obligated to make all Capital
Expenditures which are required pursuant to a Capital Budget which has been approved or deemed approved in accordance with the procedures set forth above. 
  

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 Section 3.8. Approval of Annual Budget. 
 Lessor and Lessee shall endeavor in good faith to approve the Annual Budget within the time periods specified in the Management Agreement. Within the time
periods specified in the Management Agreement, Lessor shall give Lessee written notice either (a) that Lessor approves the Annual Budget (which approval may not be unreasonably withheld, conditioned or delayed) or (b) indicating with
reasonable specificity the respects in which Lessor objects to the Annual Budget. In the latter event, Lessor and Lessee shall act promptly, reasonably and in good faith to seek to resolve Lessor’s objections. In the event that Lessor and
Lessee fail to reach agreement with respect to the Annual Budget within thirty (30) days after receipt of Lessor’s written notice, any contested matter within the Annual Budget then remaining shall be submitted to arbitration in accordance
with the procedure therefor set forth in Article XXXIX of this Lease. 
 Section 3.9. Capital Projects. 
 (a) The selection of all design professionals and contractors for capital projects shall be made by Lessor and Lessor shall provide at its expense all
materials and services for capital projects. 
 (b) Lessee shall cooperate with Lessor with respect to capital projects. Notwithstanding
anything in the foregoing which may be construed to the contrary, Lessee shall have no obligation to perform any such capital projects unless Lessee agrees to perform and be responsible for same in accordance with a written agreement therefor
between Lessor and Lessee. 
 Section 3.10. Books and Records. 
 Lessee shall keep full and adequate books of account and other records reflecting the results of operation of the Hotel on an accrual basis, all in
accordance with the Uniform System and generally accepted accounting principles to the extent applicable and the obligations of Lessee under this Lease. The books of account and all other records relating to or reflecting the operation of the Hotel
shall be kept either at the Hotel or at Lessee’s executive offices and shall be available to Lessor and its representatives and its auditors or accountants, at all reasonable times for examination, audit, inspection, and transcription. All of
such books and records pertaining to the Hotel including, without limitation, books of account, guest records and front office records, at all times shall be the property of Lessor and shall not be removed from the Hotel or Lessee’s executive
offices without Lessor approval. 
 ARTICLE IV 
 Section 4.1. Payment of Impositions. 
 Subject to Article XII relating to permitted contests
(a) Lessee will pay, or cause to be paid, all Impositions (including Real Estate Taxes, Personal Property Taxes and Capital Impositions) before any fine, penalty, interest or cost may be added for non-payment, such payments to be made directly
to the taxing or other authorities where feasible, and will promptly 
  

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 furnish to Lessor copies of official receipts or other satisfactory proof evidencing such payments, and
(b) Lessee’s obligation to pay such Impositions shall be deemed absolutely fixed upon the date such Impositions become a lien upon the Leased Property or any part thereof. Lessee will pay, or cause to be paid, all Real Estate Taxes,
Personal Property Taxes and Capital Impositions before they become delinquent. If any such Imposition may, at the option of the taxpayer, lawfully be paid in installments (whether or not interest shall accrue on the unpaid balance of such
Imposition), Lessee may exercise the option to pay the same (and any accrued interest on the unpaid balance of such Imposition) in installments and in such event, shall pay such installments during the Term (subject to Lessee’s right of contest
pursuant to the provisions of Article XII) as the same respectively become due and before any fine, penalty, premium, further interest or cost may be added thereto. Lessor, at its expense, shall, to the extent required or permitted by applicable
law, prepare and file all tax returns in respect of Lessor’s net income, gross receipts, sales and use, single business, transaction privilege, rent, ad valorem, franchise taxes, Real Estate Taxes, Personal Property Taxes, Capital Impositions
and taxes on its capital stock, and Lessee, at its expense, shall, to the extent required or permitted by applicable laws and regulations, prepare and file all other tax returns and reports in respect of any Imposition as may be required by
governmental authorities. If any refund shall be due from any taxing authority in respect of any Imposition paid by Lessee, the same shall be paid over to or retained by Lessee if no Event of Default shall have occurred hereunder and be continuing.
If an Event of Default shall have occurred and be continuing, any such refund shall be paid over to or retained by Lessor. Any such funds retained by Lessor due to an Event of Default shall be applied as provided in Article XVI. Lessor and Lessee
shall, upon request of the other, provide such data as is maintained by the party to whom the request is made with respect to the Leased Property as may be necessary to prepare any required returns and reports. Lessee shall file all Personal
Property Tax returns in such jurisdictions where it is legally required to so file. Lessor, to the extent it possesses the same, and Lessee, to the extent it possesses the same, will provide the other party, upon request, with cost and depreciation
records necessary for filing returns for any property classified as personal property. Where Lessor is legally required to file Personal Property Tax returns, Lessee shall provide Lessor with copies of assessment notices in sufficient time for
Lessor to file a protest. Lessor may, upon notice to Lessee, at Lessor’s option and at Lessor’s sole expense, protest, appeal, or institute such other proceedings (in its or Lessee’s name) as Lessor may deem appropriate to effect a
reduction of real estate or personal property assessments for those Impositions to be paid by Lessor, and Lessee, at Lessor’s expense as aforesaid, shall fully cooperate with Lessor in such protest, appeal, or other action. Lessor hereby agrees
to indemnify, defend, and hold harmless Lessee from and against any claims, obligations, and liabilities against or incurred by Lessee in connection with such cooperation. Billings for reimbursement of Personal Property Taxes by Lessee to Lessor
shall be accompanied by copies of a bill therefor and payments thereof which identify the personal property with respect to which such payments are made. Lessor, however, reserves the right to effect any such protest, appeal or other action and,
upon notice to Lessee, shall control any such activity, which shall then go forward at Lessor’s sole expense. Upon such notice, Lessee, at Lessor’s expense, shall cooperate fully with such activities. 
  

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 Section 4.2. Notice of Impositions. 
 Lessor shall give prompt Notice to Lessee of all Impositions payable by Lessee hereunder of which Lessor at any time has knowledge, provided that
Lessor’s failure to give any such Notice shall in no way diminish Lessee’s obligations hereunder to pay such Impositions, but such failure shall obviate any default hereunder for a reasonable time after Lessee receives Notice of any
Imposition which it is obligated to pay during the first taxing period applicable thereto and Lessor will pay any interest, penalty or fine caused by Lessor’s failure to give such Notice. 
 Section 4.3. Adjustment of Impositions. 
 Impositions payable by Lessee imposed in respect of the tax-fiscal period during which the Term terminates shall be adjusted and prorated between Lessor and Lessee, whether or not such Imposition is imposed before or after such termination,
and Lessee’s obligation to pay its prorated share thereof after termination shall survive such termination. 
 Section 4.4.
Utility Charges. 
 Lessee will be solely responsible for obtaining and maintaining utility services to the Leased Property and will
pay or cause to be paid all charges for electricity, gas, oil, water, sewer and other utilities used in the Leased Property during the Term. 
 Section 4.5. Insurance Premiums. 
 To the extent provided in Section 13.1, Lessor and Lessee will pay or cause to
be paid in a timely manner all premiums for the insurance coverages required to be maintained by them under Article VIII. 
 Section 4.6. Franchise Fees. 
 Lessee will pay or cause to be paid in a timely manner all franchise fees due and owing
in accordance with the terms and conditions of the Franchise Agreement. 
 ARTICLE V 
 Section 5.1. No Termination, Abatement, etc. 
 Except as otherwise specifically provided in this Lease, and except in the event of termination of the Franchise Agreement solely by reason of any action or inaction by Lessor, Lessee, to the extent permitted by law,
shall remain bound by this Lease in accordance with its terms and shall neither take any action without the written consent of Lessor to modify, surrender or terminate the same, nor seek nor be entitled to any abatement, deduction, deferment or
reduction of the Rent, or setoff against the Rent, nor shall the obligations of Lessee be otherwise affected by reason of (a) any damage to, or destruction of, the Leased Property or any portion thereof from whatever cause or any Taking of the
Leased Property or any portion thereof, (b) any 
  

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 claim which Lessee has or might have against Lessor by reason of any default or breach of any warranty by Lessor under
this Lease or any other agreement between Lessor and Lessee, or to which Lessor and Lessee are parties, (c) any bankruptcy, insolvency, reorganization, composition, readjustment, liquidation, dissolution, winding up or other proceedings
affecting Lessor or any assignee or transferee of Lessor, or (d) for any other cause whether similar or dissimilar to any of the foregoing other than a discharge of Lessee from any such obligations as a matter of law. Except in the event of a
constructive eviction of Lessee from the Leased Property for any reason other than an Event of Default, Lessee hereby specifically waives all rights, arising from any occurrence whatsoever, which may now or hereafter be conferred upon it by law to
(1) modify, surrender or terminate this Lease or quit or surrender the Leased Property or any portion thereof, or (2) entitle Lessee to any abatement, reduction, suspension or deferment of the Rent or other sums payable by Lessee
hereunder, except as otherwise specifically provided in this Lease. The obligations of Lessee hereunder shall be separate and independent covenants and agreements and the Rent and all other sums payable by Lessee hereunder shall continue to be
payable in all events unless the obligations to pay the same shall be terminated pursuant to the express provisions of this Lease or by termination of this Lease other than by reason of an Event of Default. 
 Section 5.2. Abatement Procedures. 
 In the event of a partial Taking of the Leased Property as described in Section 15.5, the Lease shall not terminate with respect to the affected Leased Property, but the Base Rent shall be abated in the manner and to the extent that is
fair, just and equitable to both Lessee and Lessor, taking into consideration, among other relevant factors, the number of usable rooms, the amount of square footage, or the revenues affected by such partial Taking. If Lessor and Lessee are unable
to agree upon the amount of such abatement within 30 days after such partial Taking, the matter may be submitted by either party to arbitration pursuant to the arbitration procedures set forth in Article XXXIX. 
 ARTICLE VI 
 Section 6.1. Ownership of
the Leased Property. 
 Lessee acknowledges that the Leased Property is the property of Lessor and that Lessee has only the right to the
possession and use of the Leased Property upon the terms and conditions of this Lease. 
 Section 6.2. Lessee’s Personal
Property. 
 Lessee will acquire, own, maintain and replace, at Lessee’s cost and expense, throughout the Term such Inventory as is
required to operate the Leased Property in the manner contemplated by this Lease. Lessee may (and shall as provided hereinbelow), at its expense, install, affix or assemble or place on any parcels of the Land or in any of the Leased Improvements,
any items of personal property (including Inventory) owned by Lessee. Lessee, at the commencement of the Term, and from time to time thereafter, shall provide Lessor with an accurate list of all such items of Lessee’s personal property
(collectively, including Inventory, 
  

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 the “Lessee’s Personal Property”). Lessee may, subject to the first sentence of this Section 6.2 and
the conditions set forth below, remove any of Lessee’s Personal Property set forth on such list at any time during the Term or upon the expiration or any prior termination of the Term. All of Lessee’s Personal Property, other than
Inventory, not removed by Lessee within thirty (30) days following the expiration or earlier termination of the Term shall be considered abandoned by Lessee and may be appropriated, sold, destroyed or otherwise disposed of by Lessor without
first giving Notice thereof to Lessee, without any payment to Lessee and without any obligation to account therefor. Lessee will, at its expense, restore the Leased Property to the condition required by Section 9.1(d), including repair of all
damage to the Leased Property caused by the removal of Lessee’s Personal Property, whether effected by Lessee or Lessor. 
 Upon the
expiration or earlier termination of the Term, Lessor shall have the option to purchase all (but not less than all) of Lessee’s Personal Property on hand at the Leased Property at the time of such expiration or termination for a sale price
(payable in cash on the expiration date of this Lease) equal to the fair market value thereof (or cost in the case of Inventory). 
 Except
as hereinafter set forth, Lessee may make such financing arrangements, title retention agreements, leases or other agreements with respect to Lessee’s Personal Property as it sees fit provided that Lessee first advises Lessor of any such
arrangement and such arrangement expressly provides that in the event of Lessee’s default thereunder, Lessor (or its designee) may assume Lessee’s obligations and rights under such arrangement. Lessee shall have the right to lease a van
for the purposes of providing shuttle service to hotel guests; provided that the terms and conditions of such lease are approved by Lessor and any secured lender with respect to the Leased Property. 
 Section 6.3. Lessor’s Lien. 
 To the fullest extent permitted by applicable law, Lessor is granted a lien and security interest on all Lessee’s Personal Property now or hereinafter placed in or upon the Leased Property, and such lien and security interest shall
remain attached to such Lessee’s Personal Property until payment in full of all Rent and satisfaction of all of Lessee’s obligations hereunder that are outstanding on such date; provided, however, Lessor shall subordinate its lien and
security interest to that of any non-Affiliate of Lessee which finances such Lessee’s Personal Property or any non-Affiliate conditional seller of such Lessee’s Personal Property, the terms and conditions of such subordination to be
satisfactory to Lessor in the exercise of reasonable discretion. Lessee shall, upon the request of Lessor, execute such financing statements or other documents or instruments reasonably requested by Lessor to perfect the lien and security interests
herein granted. 
 ARTICLE VII 
 Section 7.1. Condition of the Leased Property. 
 Lessee acknowledges receipt and delivery of possession of the Leased
Property as of the Commencement Date and that Lessee has examined and otherwise has knowledge of the condition of the Leased Property and has found the same to be satisfactory for its purposes 
  

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 hereunder. Lessee is leasing the Leased Property “as is” in its present condition. Lessee waives any claim or
action against Lessor in respect of the condition of the Leased Property. EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED HEREIN TO THE CONTRARY, LESSOR MAKES NO WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, IN RESPECT OF THE LEASED PROPERTY, OR ANY
PART THEREOF, EITHER AS TO ITS FITNESS FOR USE, DESIGN OR CONDITION FOR ANY PARTICULAR USE OR PURPOSE OR OTHERWISE, AS TO THE QUALITY OF THE MATERIAL OR WORKMANSHIP THEREIN, LATENT OR PATENT, IT BEING AGREED THAT LESSEE TAKES THE LEASED PROPERTY
SUBJECT TO ALL SUCH RISKS. LESSEE ACKNOWLEDGES THAT THE LEASED PROPERTY HAS BEEN INSPECTED BY LESSEE AND IS SATISFACTORY TO IT. Provided, however, to the extent permitted by law, Lessor hereby assigns to Lessee all of Lessor’s rights to proceed
against any predecessor in title other than Lessee (or an Affiliate of Lessee which conveyed the Property to Lessor) for breaches of warranties or representations or for latent defects in the Leased Property. Lessor shall fully cooperate with Lessee
in the prosecution of any such claim, in Lessor’s or Lessee’s name, all at Lessee’s sole cost and expense. Lessee hereby agrees to indemnify, defend and hold harmless Lessor from and against any claims, obligations and liabilities
against or incurred by Lessor in connection with such cooperation. 
 Section 7.2. Use of the Leased Property. 
 (a) Lessee covenants that it will (with Lessor’s commercially reasonable cooperation to the extent necessary and required) proceed with all due
diligence and will exercise its commercially reasonable efforts to obtain and to maintain all approvals needed to use and operate the Leased Property under applicable local, state and federal law. 
 (b) Lessee shall use, or cause to be used, the Leased Property only as a hotel facility, and for such other uses as may be necessary or incidental to
such use or such other use as otherwise approved by Lessor (the “Primary Intended Use”). Lessee shall not use the Leased Property or any portion thereof for any other use without the prior written consent of Lessor, which consent may be
granted, denied or conditioned in Lessor’s reasonable discretion. No use shall be made or permitted to be made of the Leased Property, and no acts shall be done, which will cause the cancellation or increase the premium of any insurance policy
covering the Leased Property or any part thereof (unless another adequate policy satisfactory to Lessor is available and Lessee pays any premium increase), nor shall Lessee sell or permit to be kept, used or sold in or about the Leased Property any
article which may be prohibited by law or fire underwriter’s regulations. Lessee shall, at its sole cost, comply with all of the requirements pertaining to the Leased Property of any insurance board, association, organization or company
necessary for the maintenance of insurance, as herein provided, covering the Leased Property and Lessee’s Personal Property, except that Lessee shall have no obligation to complete capital improvements to the Leased Property. 
 (c) Subject to the provisions of Articles XIV, XV, XXI and XXII and other express provisions in this Lease, with respect to the Leased Property, Lessee
covenants and agrees that during the Term it will (1) operate continuously the Leased Property as a hotel facility, (2) keep in full force and effect and comply with all the provisions of the Franchise 
  

 27 

 Agreement (except that Lessee shall have no obligation to take any actions that are the responsibility of Lessor
hereunder or to complete any capital improvements to the Leased Property required by the franchisor unless Lessor funds the cost thereof), (3) not terminate or amend the Franchise Agreement without the consent of Lessor (not to be unreasonably
withheld, conditioned or delayed), (4) maintain appropriate certifications and licenses for such use and (5) seek to maximize the Gross Revenues generated therefrom consistent with sound business practices and Lessee’s concurrent goal
of maximizing its net operating income therefrom. Lessor covenants and agrees that, with respect to the Leased Property, during the Term it will (1) not take or allow any Affiliate to take or fail to take any action that would interfere with,
restrict or prohibit Lessee’s operation of the Leased Property for its Primary Intended Use, including, without limitation, modifying, amending or terminating any Franchise Agreement or any licenses, franchises, permits, easements, leases,
undertakings or agreements held by Lessor or such Affiliate and pertaining to the Leased Property, (2) comply with all the provisions of any Franchise Agreement relating to Capital Expenditures (to the extent such Capital Expenditures are
provided for in the Capital Budget), the payment of any Real Estate Taxes, Personal Property Taxes, Capital Impositions and other requirements thereof that are not the responsibility of Lessee hereunder and (3) seek to maximize the net income
generated by Lessee from the Leased Property consistent with Lessor’s concurrent goal of maximizing the Gross Revenues generated therefrom. 
 (d) Lessee shall not commit or suffer to be committed any waste on the Leased Property, nor shall Lessee cause or permit any nuisance thereon. 
 (e) Lessee shall neither suffer nor permit the Leased Property or any portion thereof, or Lessee’s Personal Property, to be used in such a manner as (1) might reasonably tend to impair Lessor’s (or
Lessee’s, as the case may be) title thereto or to any portion thereof, or (2) may reasonably make possible a claim or claims of adverse usage or adverse possession by the public, as such, or of implied dedication of the Leased Property or
any portion thereof, except as necessary in the ordinary and prudent operation of the Hotels. 
 Section 7.3. Lessor to Grant
Easements, etc. 
 Lessor will, from time to time, so long as no Event of Default has occurred and is continuing, at the request of Lessee
and at Lessee’s cost and expense (but subject to the approval of Lessor, which approval shall not be unreasonably withheld or delayed), (a) grant easements and other rights in the nature of easements with respect to the Leased Property to
third parties, (b) release existing easements or other rights in the nature of easements which are for the benefit of the Leased Property, (c) dedicate or transfer unimproved portions of the Leased Property for road, highway or other
public purposes, (d) execute petitions to have the Leased Property annexed to any municipal corporation or utility district, (e) execute amendments to any covenants and restrictions affecting the Leased Property and (f) execute and
deliver to any person any instrument appropriate to confirm or effect such grants, releases, dedications, transfers, petitions and amendments (to the extent of its interests in the Leased Property), but only upon delivery to Lessor of an
Officer’s Certificate stating that such grant, release, dedication, transfer, petition or amendment does not interfere with the proper conduct of the business of Lessee on the Leased Property and does not materially reduce the value of the
Leased Property. 
  

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 Section 7.4. Reservation by Lessor. 
 Notwithstanding anything contained in this Lease to the contrary, Lessor expressly reserves from the operation of this Lease and the Leased Property the
right of Lessor or third party lessees of Lessor to place communications equipment on the roof of the Leased Improvements or elsewhere on the Land and to receive all rental and income therefrom. Such communications equipment shall include, but not
be limited to, satellite dishes, antennas, wires, conduits, cables and associated allied materials, machinery and equipment as necessary to properly complete the installation, maintenance and operation of such communications equipment (“the
Installations”). Lessor covenants and agrees that the Installations shall be in such locations so that their use (including installation, operations, maintenance, repair and removal) shall not unreasonably interfere with or impede the use by
Lessee of the Leased Property pursuant to this Lease. Lessor shall be responsible for the Installations being in compliance with all applicable federal, state and local laws and ordinances. As between Lessor and Lessee, Lessor shall be responsible
for the Installations being insured under appropriate casualty and general liability insurance coverages and in that regard, Lessor agrees to indemnify and hold Lessee harmless from and against any and all loss, costs, claim and liability, including
reasonable attorney’s fees, for injuries to all persons and for damage to or loss of all property, including the Leased Property, arising or alleged to arise from any act or omission of Lessor or third party lessees of Lessor, including their
agents, employees or contractors, relating to the installation, maintenance, repair, operation or removal of the Installations. 
 ARTICLE
VIII 
 Section 8.1. Compliance with Legal and Insurance Requirements, etc. 
 Subject to Sections 8.2 and 8.3(b) below and Article XII relating to permitted contests, Lessee, at its expense, will promptly (a) comply with
all applicable Legal Requirements and Insurance Requirements in respect of the use, operation, maintenance, repair and restoration of the Leased Property, and (b) procure, maintain and comply with all appropriate licenses and other
authorizations required for any use of the Leased Property and Lessee’s Personal Property then being made, and for the proper operation and maintenance of the Leased Property or any part thereof, except that Lessee shall have no obligation to
complete capital improvements to the Leased Property. 
 Section 8.2. Legal Requirement Covenants. 
 Subject to Section 8.3(b) below, Lessee covenants and agrees that the Leased Property and Lessee’s Personal Property shall not be used for any
unlawful purpose, and that Lessee shall not permit or suffer to exist any unlawful use of the Leased Property by others. Lessee shall acquire and maintain all appropriate licenses, certifications, permits and other authorizations and approvals
needed to operate the Leased Property in its customary manner for the Primary Intended Use, and any other lawful use conducted on the Leased Property as may be permitted 
  

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 from time to time hereunder. Lessee further covenants and agrees that Lessee’s use of the Leased Property and
maintenance, alteration, and operation of the same, and all parts thereof, shall at all times conform to all Legal Requirements, unless the same are finally determined by a court of competent jurisdiction to be unlawful (and Lessee shall use
reasonable efforts to cause all such sub-tenants, invitees or others to so comply with all Legal Requirements). Lessee may, however, upon prior Notice to Lessor, contest the legality or applicability of any such Legal Requirement or any licensure or
certification decision if Lessee maintains such action in good faith, with due diligence, without prejudice to Lessor’s rights hereunder, and at Lessee’s sole expense. If by the terms of any such Legal Requirement compliance therewith
pending the prosecution of any such proceeding may legally be delayed without the incurrence of any lien, charge or liability of any kind against the Hotel or Lessee’s leasehold interest therein and without subjecting Lessee or Lessor to any
liability, civil or criminal, for failure so to comply therewith, Lessee may delay compliance therewith until the final determination of such proceeding. If any lien, charge or civil or criminal liability would be incurred by reason of any such
delay, Lessee, on the prior written consent of Lessor, which consent shall not be unreasonably withheld, may nonetheless contest as aforesaid and delay as aforesaid provided that such delay would not subject Lessor to criminal liability and Lessee
both (a) furnishes to Lessor security reasonably satisfactory to Lessor against any loss or injury by reason of such contest or delay and (b) prosecutes the contest with due diligence and in good faith. 
 Section 8.3. Environmental Covenants. 
 Lessor and Lessee (in addition to, and not in diminution of, Lessee’s covenants and undertakings in Sections 8.1 and 8.2 hereof) covenant and agree as follows: 
 (a) At all times hereafter until the later of (i) such time as all liabilities, duties or obligations of Lessee to Lessor under the Lease have been
satisfied in full and (ii) such time as Lessee completely vacates the Leased Property and surrenders possession of the same to Lessor, Lessee shall fully comply with all Environmental Laws applicable to the Leased Property and the operations
thereon, except to the extent that such compliance would require the remediation of Environmental Liabilities for which Lessee has no indemnity obligations under Section 8.3(c). Lessee agrees to give Lessor prompt written notice of (1) all
Environmental Liabilities; (2) all pending, threatened or anticipated Proceedings, and all notices, demands, requests or investigations, relating to any Environmental Liability or relating to the issuance, revocation or change in any
Environmental Authorization required for operation of the Leased Property; (3) all Releases at, on, in, under or in any way affecting the Leased Property, or any Release known by Lessee at, on, in or under any property adjacent to the Leased
Property; and (4) all facts, events or conditions that could reasonably lead to the occurrence of any of the above-referenced matters. 
 (b) Lessor hereby agrees to defend, indemnify and save harmless any and all Lessee Indemnified Parties from and against any and all Environmental Liabilities other than Environmental Liabilities to the extent caused by the grossly negligent
acts or failures to act of Lessee. 
  

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 (c) Lessee hereby agrees to defend, indemnify and save harmless any and all Lessor Indemnified Parties
from and against any and all Environmental Liabilities to the extent caused by the grossly negligent acts or failures to act of Lessee. 
 (d) If any Proceeding is brought against any Indemnified Party in respect of an Environmental Liability with respect to which such Indemnified Party may claim indemnification under either Section 8.3(b) or (c), the Indemnifying Party,
upon request, shall at its sole expense resist and defend such Proceeding, or cause the same to be resisted and defended by counsel designated by the Indemnified Party and approved by the Indemnifying Party, which approval shall not be unreasonably
withheld; provided, however, that such approval shall not be required in the case of defense by counsel designated by any insurance company undertaking such defense pursuant to any applicable policy of insurance. Each Indemnified Party shall have
the right to employ separate counsel in any such Proceeding and to participate in the defense thereof, but the fees and expenses of such counsel will be at the sole expense of such Indemnified Party unless such counsel has been approved by the
Indemnifying Party, which approval shall not be unreasonably withheld. The Indemnifying Party shall not be liable for any settlement of any such Proceeding made without its consent, which shall not be unreasonably withheld, but if settled with the
consent of the Indemnifying Party, or if settled without its consent (if its consent shall be unreasonably withheld), or if there be a final, nonappealable judgment for an adversary party in any such Proceeding, the Indemnifying Party shall
indemnify and hold harmless the Indemnified Parties from and against any liabilities incurred by such Indemnified Parties by reason of such settlement or judgement. 
 (e) If at any time any Indemnified Party has reason to believe circumstances exist which could reasonably result in an Environmental Liability, upon reasonable prior written notice to Lessee stating such Indemnified
Party’s basis for such belief, an Indemnified Party shall be given immediate access to the Leased Property (including, but not limited to, the right to enter upon, investigate, drill wells, take soil borings, excavate, monitor, test, cap and
use available land for the testing of remedial technologies), Lessee’s employees, and to all relevant documents and records regarding the matter as to which a responsibility, liability or obligation is asserted or which is the subject of any
Proceeding; provided that such access may be conditioned or restricted as may be reasonably necessary to ensure compliance with law and the safety of personnel and facilities or to protect confidential or privileged information. All Indemnified
Parties requesting such immediate access and cooperation shall endeavor to coordinate such efforts to result in as minimal interruption of the operation of the Leased Property as practicable. 
 (f) The indemnification rights and obligations provided for in this Article VIII shall be in addition to any indemnification rights and obligations
provided for elsewhere in this Lease. 
 (g) The indemnification rights and obligations provided for in this Article VIII shall survive the
termination of this Lease. 
 For purposes of this Section 8.3, all amounts for which any Indemnified Party seeks indemnification shall
be computed net of (a) any actual income tax benefit resulting therefrom to such Indemnified Party, (b) any insurance proceeds received (net of tax effects) with respect 
  

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 thereto, and (c) any amounts recovered (net of tax effects) from any third parties based on claims the Indemnified
Party has against such third parties which reduce the damages that would otherwise be sustained; provided that in all cases, the timing of the receipt or realization of insurance proceeds or income tax benefits or recoveries from third parties shall
be taken into account in determining the amount of reduction of damages. Each Indemnified Party agrees to use its reasonable efforts to pursue, or assign to Lessee or Lessor, as the case may be, any claims or rights it may have against any third
party which would materially reduce the amount of damages otherwise incurred by such Indemnified Party. 
 Notwithstanding anything to the
contrary contained in this Lease, if Lessor shall become entitled to the possession of the Leased Property by virtue of the termination of the Lease or repossession of the Leased Property, then Lessor may assign its indemnification rights under
Section 8.3 of this Lease (but not any other rights hereunder) to any Person to whom Lessor subsequently transfers the Leased Property, subject to the following conditions and limitations, each of which shall be deemed to be incorporated into
the terms of such assignment, whether or not specifically referred to therein: 
 (1) The indemnification rights referred to in this
Section may be assigned only if a known Environmental Liability then exists or if a Proceeding is then pending or, to the knowledge of Lessee or Lessor, then threatened with respect to the Leased Property; 
 (2) Such indemnification rights shall be limited to Environmental Liabilities relating to or specifically affecting the Leased Property; and 

(3) Any assignment of such indemnification rights shall be limited to the immediate transferee of Lessor, and shall not extend to any such
transferee’s successors or assigns. 
 ARTICLE IX 
 Section 9.1. Maintenance and Repair. 
 (a) Unless caused by Lessee’s gross negligence or
willful misconduct or that of its employees or agents, Lessee shall not be required to bear the cost of any Capital Expenditures, including any expenditures for items classified as capital items under U.S. generally accepted accounting principles.
Except to the extent required by Article XXXVIII or elsewhere in this Lease, however, nothing herein shall be construed to require Lessor to build or rebuild any improvement on the Leased Property, or to fund or make any repairs, replacements,
alterations, restorations or renewals of any nature or description to the Leased Property, whether ordinary or extraordinary, foreseen or unforeseen, or to make any expenditure whatsoever with respect thereto, in connection with this Lease, or to
maintain the Leased Property in any way. Except as expressly set forth elsewhere in this Lease, Lessee hereby waives, to the extent permitted by law, the right to make repairs at the expense of Lessor pursuant to any law in effect at the time of the
execution of this Lease or hereafter enacted. Lessor shall have the right to give, record and post, as appropriate, notices of nonresponsibility under any mechanic’s lien laws now or hereafter existing. Notwithstanding anything in the foregoing
to the contrary, to the extent any equipment used in the operation of the Hotel as of the Commencement Date is leased 
  

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 equipment and not owned equipment, Lessor shall have no obligation to acquire such leased equipment or replace such
leased equipment with owned equipment during the Term and therefore, to the extent Lessee elects to acquire or replace any such leased equipment with owned equipment, the cost to acquire such owned equipment shall not be charged to Lessor under any
of the provisions of this Lease or reduce any amounts to which Lessor is entitled under this Lease. 
 (b) Except for conditions caused by
Lessor’s or its agents’ or employees’ breach of this Lease or their gross negligence or willful misconduct or resulting from Force Majeure, Lessee will keep the Leased Property and all private roadways, sidewalks and curbs appurtenant
thereto that are under Lessee’s control, including windows and plate glass, parking lots, mechanical, electrical and plumbing systems and equipment (including conduit and ductware), and non-load bearing interior walls, in good order and repair,
except for ordinary wear and tear (whether or not the need for such repairs occurred as a result of Lessee’s use, any prior use, the elements or the age of the Leased Property, or any portion thereof), and, except as otherwise provided in
Article XIV or XV, with reasonable promptness, make all necessary and appropriate repairs thereto of every kind and nature, whether interior or exterior, ordinary or extraordinary, foreseen or unforeseen, except repairs (i) arising by reason of
a condition existing prior to the commencement of the Term (concealed or otherwise), or (ii) capital improvements requiring Capital Expenditures required by any governmental agency having jurisdiction over the Leased Property, or
(iii) capital improvements or repairs to the structural elements of the Leased Improvements, or (iv) other capital improvements to the Leased Improvements, the cost of which would constitute Capital Expenditures. Lessee shall obtain and
maintain in effect maintenance contracts throughout the Term with reputable service firms on all serviceable systems and assets included with the Fixtures which constitute a portion of the Leased Property, unless such services can be competently
provided by Lessee’s employees, in which event such services may be provided by Lessee’s employees. All repairs shall, to the extent reasonably achievable, be at least equivalent in quality to the original work. Lessee will not take or
omit to take any action, the taking or omission of which might materially impair the value or the usefulness of the Leased Property or any part thereof for its Primary Intended Use. Notwithstanding any other provision of this Lease, however, other
than under Articles XIV and XV on the conditions set forth therein, Lessee shall not be required to bear the costs of complying with this Section with respect to Capital Expenditures, including any items classified as capital items under U.S.
generally accepted accounting principles, but shall be required to comply with this Section as to such items if and to the extent that amounts are available therefor from the reserve required to be established by Lessor under Article XX or are
otherwise provided by Lessor. Lessor shall be responsible for all such Capital Expenditures, including, without limitation, Capital Expenditures required to comply with all Legal Requirements (including, without limitation, all Environmental Laws,
the Americans with Disabilities Act and any state or local handicap access laws and regulations and all zoning and land use laws and regulations) and Capital Expenditures required to comply with any Franchise Agreement; subject to Lessor’s
right to approve the Capital Budget for such Leased Property. If Lessor fails to make any Capital Expenditure required by any Franchisor and such refusal results in a default under or termination of the related Franchise Agreement, Lessor shall be
responsible for all damages, termination payments payable by Lessee under the terms of such Franchise Agreement, application fees for a new franchise license reasonably approved by Lessor, increased royalty fees and other costs arising out of such
refusal or out of the resulting need to apply for and enter into a substitute franchise license agreement. 
  

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 (c) Nothing contained in this Lease and no action or inaction by Lessor shall be construed as
(1) constituting the request of Lessor, expressed or implied, to any contractor, subcontractor, laborer, materialman or vendor to or for the performance of any labor or services or the furnishing of any materials or other property for the
construction, alteration, addition, repair or demolition of or to the Leased Property or any part thereof, or (2) giving Lessee any right, power or permission to contract for or permit the performance of any labor or services or the furnishing
of any materials or other property in such fashion as would permit the making of any claim against Lessor in respect thereof or to make any agreement that may create, or in any way be the basis for any right, title, interest, lien, claim or other
encumbrance upon the estate of Lessor in the Leased Property, or any portion thereof. 
 (d) Lessee will, upon the expiration or prior
termination of the Term, vacate and surrender the Leased Property to Lessor in the condition in which the Leased Property was originally received from Lessor, except as repaired, rebuilt, restored, altered or added to as permitted or required by the
provisions of this Lease and except for ordinary wear and tear (subject to the obligation of Lessee to maintain the Leased Property in accordance with Section 9.1(b) above during the entire Term of the Lease), or damage by casualty or
Condemnation (subject to the obligations of Lessee to restore or repair as set forth in the Lease). 
 (e) If Lessor fails to make any
emergency Capital Expenditures promptly following Notice from Lessee of an emergency situation, then Lessee will have the right, but not the obligation, to make such Capital Expenditures on behalf of and for the account of Lessor, whereupon Lessor
shall reimburse Lessee therefor, together with interest thereon at the Overdue Rate, promptly upon receipt of all documentation evidencing such Capital Expenditure. If Lessor fails to so reimburse Lessee within ten days after written demand
therefor, then in addition to such rights and remedies as Lessee may have with respect to such breach, Lessee may offset the amounts owed against the next payments of Rent due to Lessor under this Lease. 
 Section 9.2. Encroachments, Restrictions, etc. 
 If as a result of any act or omission on the part of Lessee any of the Leased Improvements, at any time, (i) materially encroach upon any property, street or right-of-way adjacent to the Leased Property, or
(ii) violate the agreements or conditions contained in any lawful restrictive covenant or other agreement affecting the Leased Property, or any part thereof, or (iii) impair the rights of others under any easement or right-of-way to which
the Leased Property is subject as a result of any act or omission on the part of Lessee, then promptly upon the request of Lessor or at the behest of any person affected by any such encroachment, violation or impairment, Lessee shall, at its
expense, subject to its right to contest the existence of any encroachment, violation or impairment and in such case, in the event of an adverse final determination, either (a) obtain valid and effective waivers or settlements of all claims,
liabilities and damages resulting from each such encroachment, violation or impairment, whether the same shall affect Lessor or Lessee or (b) make such changes in the Leased Improvements, and take such other actions, as Lessee in the good faith
exercise of its judgment deems reasonably 
  

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 practicable to remove such encroachment, and to end such violation or impairment, including, if necessary, the alteration
of any of the Leased Improvements, and in any event take all such actions as may be necessary in order to be able to continue the operation of the Leased Improvements for the Primary Intended Use substantially in the manner and to the extent the
Leased Improvements were operated prior to the assertion of such violation, impairment or encroachment. Any such alteration shall be made in conformity with the applicable requirements of Article X. Lessee’s obligations under this
Section 9.2 shall be in addition to and shall in no way discharge or diminish any obligation of any insurer under any policy of title or other insurance held by Lessor. 
 ARTICLE X 
 Section 10.1. Alterations. 
 After receiving approval of Lessor, which approval shall not be unreasonably withheld and which approval may be evidenced by Lessor’s approval of the
Capital Budget, Lessee shall have the right to make such material additions, modifications or improvements to the Leased Property from time to time as Lessee deems desirable for its permitted uses and purposes, provided that non-material additions,
modifications and improvements will not require such consent and no such action significantly alters the character or purposes or significantly detracts from the value or operating efficiency thereof and will not significantly impair the
revenue-producing capability of the Leased Property (other than during the period such work is being performed) or adversely affect the ability of Lessee to comply with the provisions of this Lease. Except as approved in the Capital Budget, the cost
of such additions, modifications or improvements to the Leased Property shall be paid by Lessee, and all such additions, modifications and improvements shall, without payment by Lessor at any time, be included under the terms of this Lease and upon
expiration or earlier termination of this Lease shall pass to and become the property of Lessor. Notwithstanding anything in this Lease to the contrary, Lessor retains the right to reconfigure meeting/banquet rooms and guestrooms, with the result
thereof being an increase in the number of guestrooms and a decrease in the area and/or number of meeting/banquet rooms, all at the sole cost and expense of Lessor. 
 Section 10.2. Salvage. 
 All materials which are scrapped or removed in connection with the
making of repairs required by Articles IX or X shall be or become the property of Lessor or Lessee depending on which party is paying for or providing the financing for such work. 
 Section 10.3. Joint Use Agreements. 
 If Lessee constructs additional improvements that are connected to the Leased Property or share maintenance facilities, HVAC, electrical, plumbing or other systems, utilities, parking or other amenities, the parties shall enter into a
mutually agreeable cross-easement or joint use agreement, the form of which has been approved in advance by Lessor, to make available necessary services and facilities in connection with such additional improvements, to protect each of their
respective interests in the properties affected, and to provide for separate ownership, use, and/or financing of such improvements. 
  

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 ARTICLE XI 
 Section 11.1. Liens. 
 Subject to the provision of Article XII relating to permitted contests,
Lessee will not directly or indirectly create or allow to remain and will promptly discharge at its expense any lien, encumbrance, attachment, title retention agreement or claim upon the Leased Property or any attachment, levy, claim or encumbrance
in respect of the Rent, not including, however, (a) this Lease, (b) the matters, if any, included as exceptions in the title policy insuring Lessor’s interest in the Leased Property, (c) restrictions, liens and other encumbrances
which are consented to in writing by Lessor or any easements granted pursuant to the provisions of Section 7.3 of this Lease, (d) liens for those taxes upon Lessor which Lessee is not required to pay hereunder, (e) subleases permitted
by Article XXV hereof, (f) liens for Impositions or for sums resulting from noncompliance with Legal Requirements so long as (1) the same are not yet payable or are payable without the addition of any fine or penalty or (2) such liens
are in the process of being contested as permitted by Article XII, (g) liens of mechanics, laborers, materialmen, suppliers or vendors for sums either disputed or not yet due provided that (1) the payment of such sums shall not be
postponed under any related contract for more than 60 days after the completion of the action giving rise to such lien and such reserve or other appropriate provisions as shall be required by law or generally accepted accounting principles shall
have been made therefor or (2) any such liens are in the process of being contested as permitted by Article XII hereof, and (h) any liens which are the responsibility of Lessor pursuant to the provisions of this Lease. 
 ARTICLE XII 
 Section 12.1. Permitted
Contests. 
 Lessee shall have the right to contest the amount or validity of any Imposition to be paid by Lessee or any Legal Requirement
or Insurance Requirement or any lien, attachment, levy, encumbrance, charge or claim (“Claims”) not otherwise permitted by Article XI, by appropriate legal proceedings in good faith and with due diligence (but this shall not be deemed or
construed in any way to relieve, modify or extend Lessee’s covenants to pay or its covenants to cause to be paid any such charges at the time and in the manner as in this Article provided), on condition, however, that such legal proceedings
shall not operate to relieve Lessee from its obligations hereunder and shall not cause the sale or risk the loss of any portion of the Leased Property, or any part thereof, or cause Lessor or Lessee to be in default under any mortgage, deed of
trust, security deed or other agreement encumbering the Leased Property or any interest therein. Upon the request of Lessor, Lessee shall either (a) provide a bond or other assurance reasonably satisfactory to Lessor that all Claims which may
be assessed against the Leased Property together with interest and penalties, if any, thereon will be paid, or (b) deposit within the time otherwise required for payment with a bank or trust company as trustee upon terms reasonably satisfactory

  

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 to Lessor, as security for the payment of such Claims, money in an amount sufficient to pay the same, together with
interest and penalties in connection therewith, as to all Claims which may be assessed against or become a Claim on the Leased Property, or any part thereof, in said legal proceedings. Lessee shall furnish Lessor and any lender of Lessor with
reasonable evidence of such deposit within five days of the same. Lessor agrees to join in any such proceedings if the same be required to legally prosecute such contest of the validity of such Claims; provided, however, that Lessor shall not
thereby be subjected to any liability for the payment of any costs or expenses in connection with any proceedings brought by Lessee; and Lessee covenants to indemnify and save harmless Lessor from any such costs or expenses. Lessee shall be entitled
to any refund of any Claims and such charges and penalties or interest thereon which have been paid by Lessee or paid by Lessor and for which Lessor has been fully reimbursed. In the event that Lessee fails to pay any Claims when due or to provide
the security therefor as provided in this paragraph and to diligently prosecute any contest of the same, Lessor may, upon ten days advance Notice to Lessee, pay such charges together with any interest and penalties and the same shall be repayable by
Lessee to Lessor as Additional Charges at the next Payment Date provided for in this Lease. Provided, however, that should Lessor reasonably determine that the giving of such Notice would risk loss to the Leased Property or cause damage to Lessor,
then Lessor shall give such Notice as is practical under the circumstances. Lessor reserves the right to contest any of the Claims at its expense not pursued by Lessee. Lessor and Lessee agree to cooperate in coordinating the contest of any claims.

 ARTICLE XIII 
 Section 13.1. General Insurance Requirements. 
 During the Term, Lessor and Lessee agree at all times to keep the Leased
Property insured with the kinds and amounts of insurance described in the Management Agreement. 
 Section 13.2. Waiver of
Subrogation. 
 If available, all Property insurance policies carried by Lessor or Lessee shall expressly waive any right of subrogation
on the part of the insurer against the other party. 
 Section 13.3. Form Satisfactory, etc. 
 All of the policies of insurance referred to in this Article XIII shall be written in a form, with deductibles reasonably satisfactory to Lessor.
Lessee shall pay all of the premiums relating to insurance coverage required per Section 13.1 and deliver certificates thereof to Lessor prior to their effective date and annually thereafter. In the event of the failure of Lessee either to
effect such insurance as herein called for or to pay the premiums therefore, or to deliver such certificates thereof to Lessor at the times required, Lessor shall be entitled, but shall have no obligation, to effect such insurance and pay the
premiums therefore, and Lessee shall reimburse Lessor for any premium or premiums paid by Lessor for the coverage required under this Section upon written demand therefore, and Lessee’s failure to repay the same within 30 days after Notice of
such failure from Lessor shall constitute an Event of Default within the meaning of Section 16.1(c). Each insurer mentioned in this Article XIII shall agree, by endorsement to the 
  

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 policy or policies issued by it, that it will give to Lessor at least 60 days written notice before the coverage under
such policy or policies in question shall be materially reduced, allowed to expire or cancelled. 
 Section 13.4. Increase in
Limits. 
 If either Lessor or Lessee at any time deems the limits and/or retentions of the coverages outlined in Section 13.1 then
carried to be either excessive or insufficient, Lessor and Lessee shall endeavor in good faith to agree in writing on the proper and reasonable limits for such insurance to be carried and such insurance shall thereafter be carried with the limits
and/or retentions thus agreed on until further change pursuant to the provision of this Section. 
 Section 13.5. Blanket Policy.

 Notwithstanding anything to the contrary contained in this Article XIII, Lessee or Lessor may bring the insurance provided for herein
within the coverage of a so-called blanket policy or policies of insurance carried and maintained by Lessee or Lessor; provided, however, that the coverage afforded to Lessor and Lessee will not be reduced or diminished or otherwise be different
from that which would exist under a separate policy of insurance, and provided further that the requirements of this Article XIII are otherwise satisfied. 
 Section 13.6. Separate Insurance. 
 Lessee shall not on Lessee’s own initiative or pursuant
to the request or requirement of any third party, take out separate insurance or increase the amount of any then existing insurance by securing an additional policy or additional policies, unless all parties having an insurable interest in the
subject matter of the insurance, including in all cases Lessor, are included therein as insureds, and the loss is payable under separate additional insurance in the same manner as losses are payable under this Lease. Lessee shall immediately notify
Lessor in writing that Lessee has obtained any such separate insurance or of the increasing of any of the amounts of the then existing insurance. 
 Section 13.7. Reports On Insurance Claims. 
 Lessee shall promptly investigate and make a complete and timely written
report to the appropriate insurance company as to all accidents. Claims for damage relating to the ownership, operation, and maintenance of the Hotel, any damage or destruction to the Hotel and the estimated cost of repair thereof shall prepared by
Lessee. Lessee shall prepare any and all reports required by any insurance company as required under the terms of the insurance policy involved, and a final copy of such report shall be furnished to Lessor. Lessee shall be authorized to execute
proofs of such loss, in the aggregate amount of $5,000 or less, with respect to any single casualty or other event. 
  

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 ARTICLE XIV 
 Section 14.1. Insurance Proceeds. 
 Subject to the provisions of Section 14.5 and except to
the extent otherwise required in the policies of insurance required hereunder, all proceeds payable by reason of any loss or damage to the Leased Property, or any portion thereof, and insured under any policy of insurance required by Article XIII of
this Lease shall be paid to Lessor and held in trust by Lessor in an interest-bearing account, shall be made available, if applicable, for reconstruction or repair, as the case may be, of any damage to or destruction of the Leased Property, or any
portion thereof, and, if applicable, shall be paid out by Lessor from time to time for the reasonable costs of such reconstruction or repair upon satisfaction of reasonable terms and conditions specified by Lessor. Any excess proceeds of insurance
remaining after the completion of the restoration or reconstruction to the Leased Property shall be paid to Lessee. If neither Lessor nor Lessee is required or elects to repair and restore, all such insurance proceeds shall be retained by Lessor.
Determination of all salvage resulting from any property covered by insurance shall be made by Lessor. 
 Section 14.2.
Reconstruction in the Event of Damage or Destruction Covered by Insurance. 
 (a) If the Leased Property is totally or partially
destroyed by a risk covered by the insurance described in Article XIII and in Lessor’s reasonable judgment the Hotel thereby is rendered Unsuitable for its Primary Intended Use, Lessor may, at Lessor’s option to be exercised within ninety
(90) days after the date of such occurrence, restore the Hotel to substantially the same condition as existed immediately before the damage or destruction and otherwise in accordance with the terms of the Lease. If Lessor fails to timely make
such election, Lessor shall be deemed to have terminated the Lease, in which case Lessor must provide Lessee with Substitute Leases for execution by Lessee, at Lessee’s election, as described in Article XL of this Lease. 
 (b) If the Leased Property is partially destroyed by a risk covered by the insurance described in Article XIII, but the Hotel is not thereby rendered
Unsuitable for its Primary Intended Use, Lessor shall promptly restore the Hotel to substantially the same condition as existed immediately before the damage or destruction and otherwise in accordance with the terms of the Lease to the extent of
insurance proceeds received by Lessor. 
 Section 14.3. Lessee’s Personal Property. 
 All insurance proceeds payable by reason of any loss of or damage to any of Lessee’s Personal Property and any business interruption insurance shall
be paid to Lessee; provided, however, no such payments shall diminish or reduce the insurance payments otherwise payable to or for the benefit of Lessor hereunder. 
  

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 Section 14.4. Abatement of Rent. 
 Any damage or destruction due to casualty notwithstanding, this Lease shall remain in full force and effect, but Lessee’s obligation to make rental
payments and to pay all other charges required by this Lease shall be equitably abated from and after the date of such damage or destruction. 
 Section 14.5. Damage Near End of Term. 
 If damage to or destruction of the Leased Property rendering the Hotel
Unsuitable for its Primary Intended Use occurs during the last 24 months of the Term, then Lessor or Lessee shall have the right to terminate this Lease by giving written notice to the other party within 30 days after the date of damage or
destruction, whereupon all accrued Rent shall be paid immediately, and this Lease shall automatically terminate five days after the date of such notice. 
 Section 14.6. Waiver. 
 Lessee hereby waives any statutory rights of termination that may arise
by reason of any damage or destruction of the Leased Property that Lessor is obligated to restore or may restore under any of the provisions of this Lease. 
 ARTICLE XV 
 Section 15.1. Definitions. 
 (a) “Condemnation” means a Taking resulting from (1) the exercise of any governmental power, whether by legal proceedings or otherwise, by
a Condemnor, and (2) a voluntary sale or transfer by Lessor to any Condemnor, either under threat of condemnation or while legal proceedings for condemnation are pending. 
 (b) “Date of Taking” means the date the Condemnor has the right to possession of the property being condemned. 
 (c) “Award” means all compensation, sums or anything of value awarded, paid or received on a total or partial Condemnation. 
 (d) “Condemnor” means any public or quasi-public authority, or private corporation or individual, having the power of Condemnation. 

Section 15.2. Parties’ Rights and Obligations. 
 If, during the Term, there is any Condemnation of all or any part of the Leased Property or any interest in this Lease, the rights and obligations of Lessor and Lessee shall be determined by this Article XV.

  

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 Section 15.3. Total Taking. 
 If title to the fee of the whole of the Leased Property is condemned by any Condemnor, this Lease shall cease and terminate as of the Date of Taking by
the Condemnor with respect to the Leased Property. If title to the fee of less than the whole of the Leased Property is so taken or condemned, which nevertheless renders the Leased Property Unsuitable or Uneconomic for its Primary Intended Use,
Lessee and Lessor shall each have the option, by notice to the other, at any time prior to the Date of Taking, to terminate this Lease as of the Date of Taking. Upon such date, if such Notice has been given, this Lease shall thereupon cease and
terminate with respect to the Leased Property. All Base Rent, Percentage Rent and Additional Charges paid or payable by Lessee hereunder with respect to the Leased Property shall be apportioned as of the Date of Taking, and Lessee shall promptly pay
Lessor such amounts. 
 Section 15.4. Allocation of Award. 
 The total Award made in connection with a Total Taking, or a partial Taking that results in a termination of this Lease with respect to the Leased
Property, or for loss of Rent, or for Lessor’s loss of business beyond the Term, shall be solely the property of and payable to Lessor. Any Award made for loss of Lessee’s business during the remaining Term, if any, or for the taking of
Lessee’s Personal Property or for removal and relocation expenses of Lessee in any such proceedings shall be the sole property of and payable to Lessee. Any other Award not separately allocated to Lessor or Lessee shall be equitably apportioned
between Lessor and Lessee in proportion to the then Fair Market Value of the leasehold estate of Lessee hereunder and the then Fair Market Value of the Leased Property. 
 Section 15.5. Partial Taking. 
 If title to less than the whole of the Leased Property is
condemned, and the Leased Property is still suitable for its Primary Intended Use, and not Uneconomic for its Primary Intended Use, or if Lessee or Lessor is entitled but neither elects to terminate this Lease with respect to the Leased Property as
provided in Section 15.3, Lessor at its cost shall with all reasonable dispatch restore the untaken portion of any Leased Improvements so that the Leased Improvements constitute a complete architectural unit of the same general character and
condition (as nearly as may be possible under the circumstances) as the Leased Improvements existing immediately prior to the Condemnation. 
 Section 15.6. Temporary Taking. 
 If the whole or any part of the Leased Property or of Lessee’s interest under
this Lease is condemned by any Condemnor for its temporary use or occupancy, which for purposes hereof shall mean two (2) weeks or less, this Lease shall not terminate by reason thereof, and Lessee shall continue to pay, in the manner and at
the terms herein specified, the full amounts of Base Rent and Additional Charges with respect to such Leased Property. In addition, Lessee shall pay Percentage Rent at a rate equal to the average Percentage Rent during the last three preceding
Fiscal Years (or if three Fiscal Years shall not have elapsed, the average during the preceding Fiscal Years). Except only to the extent that Lessee may be prevented from so doing pursuant to 
  

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 the terms of the order of the Condemnor, Lessee shall continue to perform and observe all of the other terms, covenants,
conditions and obligations hereof on the part of Lessee to be performed and observed, as though such Condemnation had not occurred. In the event of any Condemnation as in this Section 15.6 described, the entire amount of any Award made for such
Condemnation allocable to the Term of this Lease, whether paid by way of damages, rent or otherwise, shall be paid to Lessor. Lessor covenants that upon the termination of any such period of temporary use or occupancy it will, at its sole cost and
expense, restore the Leased Property as nearly as may be reasonably possible to the condition in which the same was immediately prior to such Condemnation, unless such period of temporary use or occupancy extends beyond the expiration of the Term,
in which case Lessee shall not be required to make such restoration. 
 ARTICLE XVI 
 Section 16.1. Events of Default. 
 If any one or more of the following events (individually, an “Event of Default”) occurs: 
 (a) if Lessee fails to make
payment of the Base Rent, Percentage Rent or Additional Charges within ten (10) days after the same becomes due and payable and such failure continues for five (5) business days after notice to Lessee of such failure; provided, however,
Lessor shall not be required to give notice of such failure more than three (3) times in any Fiscal Year; or 
 (b) if Lessee fails to
observe or perform any other term, covenant or condition of this Lease and such failure is not cured by Lessee within a period of thirty (30) days after receipt by such party of Notice thereof from Lessor, unless such failure cannot with due
diligence be cured within a period of thirty (30) days, in which case it shall not be deemed an Event of Default if Lessee proceeds promptly and with due diligence to cure the failure and diligently completes the curing thereof provided,
however, in no event shall such cure period extend beyond 150 days after such Notice (provided that no Event of Default shall be deemed to have occurred pursuant to this subsection (c) to the extent that Lessee’s failure to observe or
perform any term, covenant or condition of this Lease is caused by Lessor’s failure to fulfill its obligations under this Lease or an Unavoidable Occurrence); or 
 (c) if Lessee or Lessor shall file a petition in bankruptcy or reorganization for an arrangement pursuant to any federal or state bankruptcy law or any similar federal or state law, or shall be adjudicated a bankrupt
or shall make an assignment for the benefit of creditors or shall admit in writing its inability to pay its debts generally as they become due, or if a petition or answer proposing the adjudication of Lessee as a bankrupt or its reorganization
pursuant to any federal or state bankruptcy law or any similar federal or state law shall be filed in any court and Lessee shall be adjudicated a bankrupt and such adjudication shall not be vacated or set aside or stayed within sixty (60) days
after the entry of an order in respect thereof, or if a receiver of Lessee of the whole or substantially all of the assets of Lessee shall be appointed in any proceedings brought by Lessee or if any such receiver, trustee or liquidator shall be
appointed in any proceeding brought against Lessee shall not be vacated or set aside or stayed within sixty (60) days after such appointment; or 
  

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 (d) if Lessee or Lessor is liquidated or dissolved, or begins proceedings toward such liquidation or
dissolution, or, if Lessee or Lessor in any manner, permits the sale or divestiture of substantially all of its assets; or 
 (e) if the
estate or interest of Lessee in the Leased Property or any part thereof is voluntarily or involuntarily transferred, assigned, conveyed, levied upon or attached in any proceeding (unless Lessee is contesting such lien or attachment in good faith in
accordance with this Lease); or 
 (f) if, except as a result of damage, destruction, renovation or a partial or complete Condemnation or
otherwise with Lessor’s prior written approval, Lessee voluntarily ceases operations on the Leased Property for a period in excess of thirty (30) days; or 
 (g) if an event of default has been declared by the franchisor under the Franchise Agreement with respect to the Hotel as a result of any action or failure to act by Lessee or any other person with whom Lessee
contracts for management services at the Hotel, other than a default caused by a breach of this Lease by Lessor or a failure to complete improvements required by the franchisor because Lessor has not provided funds for such improvements to the
extent required pursuant to this Lease or Lessor is otherwise accountable for such default under the Franchise Agreement, and such event of default is continuing after the expiration of any applicable grace period; or 
 (h) if an event of default by Lessee (or any Affiliate of Lessee) occurs under any other lease between Lessor (or any Affiliate of Lessor) and Lessee. In
the event of an event of default by Lessee under this Lease, such event of default shall also constitute an event of default under any other lease between Lessor (or any Affiliate of Lessor) and Lessee. 
 For purposes of this Section 16.1(h), Lessee shall mean and include any additional lessee subsequently approved by Lessor (or any Affiliate of
Lessor) for lease transactions with Lessor (or any Affiliate of Lessor) and with whom a lease or leases are actually entered into by Lessor (or any Affiliate of Lessor). 
 Then, and in any such event and provided such Event of Default by Lessee is continuing, Lessor may exercise one or more remedies available to it herein or at law or in equity, including but not limited to its right to
terminate this Lease giving Lessee not less than ten (10) days’ written notice of such termination. 
 If litigation is commenced
with respect to any alleged default under this Lease, the prevailing party in such litigation shall receive, in addition to its damages incurred, such sum as the court shall determine as its reasonable attorneys’ fees, and all costs and
expenses incurred in connection therewith. 
  

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 Section 16.2. Surrender. 
 If an Event of Default occurs for other than by reason of Force Majeure (and the event giving rise to such Event of Default has not been cured within the
curative period relating thereto as set forth in Section 16.1) and is continuing, whether or not this Lease has been terminated pursuant to Section 16.1, Lessee shall, if requested by Lessor so to do, immediately surrender and assign to
Lessor or Lessor’s designee the Leased Property including, without limitation, any and all books, records, files, licenses, permits and keys relating thereto, and quit the same and Lessor may enter upon and repossess the Leased Property by
reasonable force, summary proceedings, ejectment or otherwise, and may remove Lessee and all other persons and any and all personal property from the Leased Property, subject to rights of any hotel guests and to any requirement of law. Lessee hereby
waives any and all requirements of applicable laws for service of notice to re-enter the Leased Property. Lessor shall be under no obligation to, but may if it so chooses, relet the Leased Property or otherwise mitigate Lessor’s damages.

 Section 16.3. Damages. 
 (a) Neither (i) the termination of this Lease, (ii) the repossession of the Leased Property, (iii) the failure of Lessor to relet the Leased Property, nor (iv) the reletting of all or any portion thereof, shall relieve
Lessee of its liability and obligations hereunder, all of which shall survive any such termination, repossession or reletting. In the event of any such termination, Lessee shall forthwith pay to Lessor all Rent due and payable with respect to the
Leased Property to and including the date of such termination. 
 (b) Lessee shall forthwith pay to Lessor, at Lessor’s option, as and
for liquidated and agreed current damages for Lessee’s default, either: 
 (i) Without termination of Lessee’s right
to possession of the Leased Property, each installment of Rent (including Percentage Rent as determined below) and other sums payable by Lessee to Lessor under the Lease as the same becomes due and payable, which Rent and other sums shall bear
interest at the Overdue Rate, and Lessor may enforce, by action or otherwise, any other term or covenant of this Lease; or 
 (ii) the sum of: 
 (A) the unpaid Rent which had been earned at the time of termination, repossession or reletting;

 (B) the worth at the time of termination, repossession or reletting of the amount by which the unpaid Rent for the balance
of the Term after the time of termination, repossession or reletting, exceeds the amount of such rental loss that Lessee proves could be reasonably avoided and as reduced for rentals received after the time of termination, repossession or reletting,
if and to the extent required by applicable law; and 
 (C) any other amount necessary to compensate Lessor for all the
detriment proximately caused by Lessee’s failure to perform its obligations under 
  

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 this Lease or which in the ordinary course of things, would be likely to result therefrom. The worth at
the time of termination, repossession or reletting of the amount referred to in subparagraph (B) is computed by discounting such amount at the discount rate of the Federal Reserve Bank of New York at the time of award plus 1%. 
 Percentage Rent for the purposes of this Section 16.3 shall be a sum equal to (i) the average of the annual amounts of the Percentage Rent for
the three Fiscal Years immediately preceding the Fiscal Year in which the termination, re-entry or repossession takes place, or (ii) if three Fiscal Years shall not have elapsed, the average of the Percentage Rent during the preceding Fiscal
Years during which the Lease was in effect, or (iii) if one Fiscal Year has not elapsed, the amount derived by annualizing the Percentage Rent from the effective date of this Lease. 
 Section 16.4. Waiver. 
 If this
Lease is terminated pursuant to Section 16.1, Lessee waives, to the extent permitted by applicable law, (a) any right to a trial by jury in the event of summary proceedings to enforce the remedies set forth in this Article XVI, and
(b) the benefit of any laws now or hereafter in force exempting property from liability for rent or for debt and Lessor waives any right to “pierce the corporate veil” of Lessee other than to the extent funds shall have been
inappropriately paid any Affiliate of Lessee following a default resulting in an Event of Default. 
 Section 16.5. Application of
Funds. 
 Any payments received by Lessor under any of the provisions of this Lease during the existence or continuance of any Event of
Default shall be applied to Lessee’s obligations in the order that Lessor may determine or as may be prescribed by the laws of the State. 
 ARTICLE XVII 
 Section 17.1. Lessor’s Right to Cure Lessee’s Default. 
 If Lessee fails to make any payment or to perform any act required to be made or performed under this Lease including, without limitation, Lessee’s
failure to comply with the terms of any Franchise Agreement other than a failure to complete improvements required by the franchisor because Lessor has not provided Lessee with the funds therefor, and fails to cure the same within the relevant time
periods provided in Section 16.1, Lessor, without waiving or releasing any obligation of Lessee, and without waiving or releasing any obligation or default, may (but shall be under no obligation to) at any time thereafter make such payment or
perform such act for the account and at the expense of Lessee, and may, to the extent permitted by law, enter upon the Leased Property for such purpose and, subject to Section 16.4, take all such action thereon as, in Lessor’s opinion, may
be necessary or appropriate therefor. No such entry shall be deemed an eviction of Lessee. All sums so paid by Lessor and all costs and expenses (including, without limitation, reasonable attorneys’ fees and expenses, in each case to the extent
permitted by law) so incurred, together with a late charge thereon (to the extent permitted by law) at the 
  

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 Overdue Rate from the date on which such sums or expenses are paid or incurred by Lessors, shall be paid by Lessee to
Lessor on demand. The obligations of Lessee and rights of Lessor contained in this Article shall survive the expiration or earlier termination of this Lease. 
 ARTICLE XVIII 
 Section 18.1. Provisions Relating to Purchase of the Leased Property.

 If Lessee purchases the Leased Property from Lessor pursuant to any of the terms of this Lease, the closing of the purchase shall occur 30
days after Lessor accepts Lessee’s offer to purchase the Leased Property, unless the provision of the Lease under which such offer was made specifies a different closing date, in which case the date set forth in such provision shall be the
closing date. At such closing, Lessor shall, upon receipt from Lessee of the applicable purchase price, together with full payment of any unpaid Rent due and payable with respect to any period ending on or before the date of the purchase, deliver to
Lessee an appropriate limited or special warranty deed or other conveyance conveying the entire interest of Lessor in and to the Leased Property to Lessee free and clear of all encumbrances other than (a) those that Lessee has agreed hereunder
to pay or discharge, (b) those mortgage liens, if any, that Lessee has agreed in writing to accept and to take title subject to, (c) those liens and encumbrances subject to which the Leased Property was conveyed to Lessor,
(d) encumbrances, easements, licenses or rights of way required to be imposed on the Leased Property under Section 7.3, and (e) any other encumbrances permitted to be imposed on the Leased Property under the provisions of
Article XXXIV that are assumable at no cost to Lessee or to which Lessee may take subject without cost to Lessee. The difference between the applicable purchase price and the total of the encumbrances assumed or taken subject to shall be paid
in cash to Lessor or as Lessor may direct, in federal or other immediately available funds, except as otherwise mutually agreed by Lessor and Lessee. All expenses of such conveyance, including, without limitation, the cost of title examination or
title insurance, if desired by Lessee, Lessee’s attorneys’ fees incurred in connection with such conveyance and release, and transfer taxes and recording fees, shall be paid by Lessee. Lessor shall pay its attorney’s fees. 

ARTICLE XIX 
 Section 19.1. REIT
Requirements. 
 (a) Lessee understands that, in order for Highland Hospitality Corporation to qualify as a REIT, the following
requirements (the “REIT Requirements”) must be satisfied: 
 (i) Personal Property Limitation. Anything
contained in this Lease to the contrary notwithstanding, the average of the fair market values of the items of personal property that are leased to Lessee under this Lease at the beginning and at the end of any Fiscal Year shall not exceed fifteen
percent (15%) of the average of the aggregate fair market values of the Leased Property at the beginning and at the end of such Fiscal Year. 
  

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 (ii) Sublease Rent Limitation. Anything contained in this Lease to the contrary
notwithstanding, Lessee shall not sublet the Leased Property on any basis such that the rental or other amounts to be paid by the sublessee thereunder would be based, in whole or in part, on either (a) the net income or profits derived by the
business activities of any Person, or (b) any other formula such that any portion of the Rent would fail to qualify as “rents from real property” within the meaning of Section 856(d) of the Code, or any similar or successor
provision thereto. 
 (iii) Sublease Tenant Limitation. Anything contained in this Lease to the contrary
notwithstanding, Lessee shall not, without the prior written approval of the Lessor, sublease the Leased Property to any Person in which Highland Hospitality Corporation owns, directly or indirectly, a ten percent (10%) or greater interest,
within the meaning of Section 856(d)(2)(B) of the Code, or any similar or successor provisions thereto. 
 (iv) TRS
Election. Lessee either has made an election, together with Highland Hospitality Corporation, to be and operates as a “taxable REIT subsidiary” of Highland Hospitality Corporation within the meaning of Section 856(1) of the Code,
or is an entity that is a corporation (or is treated as a corporation for federal income tax purposes) and more than thirty-five percent (35%) of the voting power or value of whose securities is owned by an entity that has made an election,
together with Highland Hospitality Corporation, to be and operates as a “taxable REIT subsidiary” of Highland Hospitality Corporation within the meaning of Section 856(1) of the Code. 
 (v) Lessee shall not (A) directly or indirectly operate or manage a “lodging facility” within the meaning of
Section 856(d)(9)(D)(ii) of the Code or a “health care facility” within the meaning of Section 856(e)(6)(D)(ii) of the Code or (B) directly or indirectly provide to any other person (under a franchise, license, or otherwise)
rights to any brand name under which any lodging facility or health care facility is operated; provided, however, that Lessee may provide such rights to a Manager (as defined in Section 19.3 hereof) to operate or manage a lodging facility as
long as such rights are held by Lessee as a franchisee, licensee, or in a similar capacity and such lodging facility is either owned by Lessee or is leased to Lessee by Lessor or one of its Affiliates. 
 (vi) Lessee shall not allow any wagering activities to be conducted at, or in connection with the Leased Property. 
 (vii) Lessee shall not allow any amenities or facilities to be provided at the Leased Property unless such amenities and facilities are
customary for other properties of a comparable size and class owned by Unrelated Persons. 
 (b) Lessee agrees, and agrees to use its best
efforts to cause its Affiliates, to use its best efforts to permit the REIT Requirements to be satisfied and to cooperate in good faith with Highland Hospitality Corporation and Lessor to ensure that the REIT Requirements are satisfied. Lessee
agrees, and agrees to use reasonable efforts to cause its Affiliates, upon request by Highland Hospitality Corporation, and, where appropriate, at Highland Hospitality 
  

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 Corporation’s expense, to take reasonable action necessary to ensure compliance with the REIT Requirements.
Immediately after becoming aware that the REIT Requirements are not, or will not be, satisfied, Lessee shall notify, or use reasonable efforts to cause its Affiliates to notify, Highland Hospitality Corporation of such noncompliance. 
 (c) The REIT Requirements are intended to ensure that the Rent qualifies as “rents from real property” within the meaning of
Section 856(d) of the Code, or any similar or successor provisions thereto, and shall be interpreted in a manner consistent with such intent. 
 Section 19.2. Lessee Officer and Employee Limitation. 
 Anything contained in this Lease to the contrary
notwithstanding, none of the officers or employees of Lessee or any entity in which Lessee has a direct or indirect ownership interest (a “Lessee-Owned Entity”) shall be officers or employees of a Manager (or any Person who operates or
manages the Leased Property) or any entity in which the Manager (or such Person) has a direct or indirect ownership interest (a “Manager-Owned Entity”). In addition, if a Person serves as both (a) a director of Lessee or any
Lessee-Owned Entity and (b) a director and officer (or employee) of Manager (or any Person who operates or manages the Leased Property) or any Manager-Owned Entity, that Person shall not receive any compensation for servicing as a director of
Lessee or any Lessee-Owned Entity. If a person serves as both (a) a director of Manager (or any Person who operates or manages the Leased Property) or any Manager-Owned Entity and (b) a director and officer (or employee) of Lessee or any
Lessee-Owned Entity, that Person shall not receive any compensation for serving as a director of Manager or any Manager-Owned Entity. 
 Section 19.3. Management Agreement. 
 Lessee agrees that, in order to comply with certain of the REIT Requirements, it
will, at all times during the Term, cause the Leased Property to be operated and managed by a manager that is an Eligible Independent Contractor (“Manager”). Effective as of the Commencement Date, Lessee shall have entered into or assumed
a Management Agreement and Lessee shall provide Lessor with an executed copy thereof. Lessee may not amend, modify, or terminate the Management Agreement in any respect or change the Manager without the prior written consent of Lessor. Lessee also
shall provide Lessor with copies of any amendments or modifications to the Management Agreement which are entered into from time to time or any other management agreement. Lessor shall have the right to approve in advance any Manager. 
 ARTICLE XX 
 Section 20.1. Holding
Over. 
 If Lessee for any reason remains in possession of the Leased Property after the expiration or earlier termination of the Term,
such possession shall be as a tenant at sufferance during which time Lessee shall pay as rental each month 150% the aggregate of (a) one-twelfth of the aggregate Base Rent and Percentage Rent payable with respect to the last Fiscal Year of the
Term with respect to such Leased Property, (b) all Additional Charges accruing during the 
  

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 applicable month and (c) all other sums, if any, payable by Lessee under this Lease with respect to the Leased
Property. During such period, Lessee shall be obligated to perform and observe all of the terms, covenants and conditions of this Lease, but shall have no rights hereunder other than the right, to the extent given by law to tenancies at sufferance,
to continue its occupancy and use of the Leased Property. Nothing contained herein shall constitute the consent, express or implied, of Lessor to the holding over of Lessee after the expiration or earlier termination of this Lease. 
 ARTICLE XXI 
 Section 21.1. Abatement
of Rent. 
 Except in the event of a constructive eviction of Lessee from the Leased Property for any reason other than an Event of
Default or as expressly provided in this Lease, Lessee shall not be entitled to any abatement of Rent. 
 ARTICLE XXII 
 Section 22.1. Indemnification. 
 Notwithstanding the existence of any insurance, and without regard to the policy limits of any such insurance or self-insurance, but subject to Section 16.4 and Article VIII, Lessee will protect, indemnify, hold harmless and defend
Lessor from and against all liabilities, obligations, claims, damages, penalties, causes of action, costs and expenses (including, without limitation, reasonable attorneys’ fees and expenses), to the extent permitted by law, imposed upon or
incurred by or asserted against Lessor Indemnified Parties by reason of: (a) any accident, injury to or death of persons or loss of or damage to property occurring on or about the Leased Property or adjoining sidewalks, including without
limitation any claims under liquor liability, “dram shop” or similar laws, (b) any present or future use, misuse, non-use, management, maintenance or repair by Lessee or any of its agents, employees or invitees of the Leased Property
or Lessee’s Personal Property or any litigation, proceeding or claim by governmental entities or other third parties to which a Lessor Indemnified Party is made a party or participant related to such use, misuse, non-use, management,
maintenance, or repair thereof by Lessee or any of its agents, employees or invitees, including any failure of Lessee or any of its agents, employees or invitees to perform any obligations under this Lease or imposed by applicable law (other than
arising out of Condemnation proceedings), (c) any Impositions that are the obligations of Lessee pursuant to the applicable provisions of this Lease, (d) any failure on the part of Lessee to perform or comply with any of the terms of this
Lease, and (e) the non-performance of any of the terms and provisions of any and all existing and future subleases of the Leased Property to be performed by the landlord thereunder. 
 Without limiting the generality of the foregoing paragraph, Lessee shall indemnify, save harmless and defend Lessor Indemnified Parties (including, but
not limited to, any Lessor Indemnified Party that is a guarantor of the Franchise Agreement) from and against all liabilities, obligations, claims, damages, penalties, causes of action, costs and expenses (including, but not 
  

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 limited to, transfer fees and termination fees) imposed upon or incurred by or asserted against Lessor Indemnified
Parties under or with respect to the Franchise Agreement which arises as a result of (a) any default by Lessee under the terms of this Lease; or (b) any default by Lessee under the Franchise Agreement unless such default is a result of
Lessor’s default under this Lease. 
 Lessor shall indemnify, save harmless and defend Lessee Indemnified Parties from and against all
liabilities, obligations, claims, damages, penalties, causes of action, costs and expenses imposed upon or incurred by or asserted against Lessee Indemnified Parties as a result of (a) the gross negligence or willful misconduct of Lessor
arising in connection with this Lease; (b) any failure on the part of Lessor to perform or comply with any of the terms of this Lease; (c) the failure by Lessor to make capital improvements required in this Lease or to comply with
applicable Legal Requirements or any requirements imposed by the franchisor in accordance with the Franchise Agreement or necessary to maintain the safety or structural soundness of the Leased Property; (d) any condition existing on the Leased
Property at the Commencement Date; and (e) all events occurring prior to the Commencement Date and subsequent to the expiration or termination of this Lease. 
 Without limiting the generality of the foregoing paragraph, Lessor shall indemnify, save harmless and defend Lessee Indemnified Parties (including, but not limited to, any Lessee Indemnified Party that is a guarantor
of the Franchise Agreement) from and against all liabilities, obligations, claims, damages, penalties, causes of action, costs and expenses (including, but not limited to, transfer fees and termination fees) imposed upon or incurred by or asserted
against Lessee Indemnified Parties under or with respect to the Franchise Agreement which arises as a result of (a) any default by Lessor under the terms of this Lease; (b) the sale by Lessor of the Leased Property or any interest of
Lessor in the Leased Property; (c) the failure by Lessor to make capital improvements required to comply with applicable Legal Requirements or any requirements imposed by the franchisor in accordance with the Franchise Agreement or necessary to
maintain the safety or structural soundness of the Leased Property; or (d) any act or omission of any person that acquires the Leased Property or any interest of Lesser in the Leased Property. 
 Any amounts that become payable by an Indemnifying Party under this Section shall be paid within ten (10) days after liability therefor on the
part of the Indemnifying Party is determined by litigation or otherwise, and if not timely paid, shall bear a late charge (to the extent permitted by law) at the Overdue Rate from the date of such determination to the date of payment. An
Indemnifying Party, at its expense, shall contest, resist and defend any such claim, action or proceeding asserted or instituted against the Indemnified Party. The Indemnified Party, at its expense, shall be entitled to participate in any such
claim, action, or proceeding, and the Indemnifying Party may not compromise or otherwise dispose of the same without the consent of the Indemnified Party, which may not be unreasonably withheld. Nothing herein shall be construed as indemnifying a
Lessor Indemnified Party against its own grossly negligent acts or omissions or willful misconduct. 
 Lessee’s or Lessor’s
liability for a breach of the provisions of this Article shall survive any termination of this Lease. 
  

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 ARTICLE XXIII 
 Section 23.1. Subletting and Assignment. 
 Subject to the provisions of Article XIX and
Section 23.2 and any other express conditions or limitations set forth herein, Lessee may, but only with the consent of Lessor, which consent may be withheld in Lessor’s sole discretion, (a) assign this Lease with respect to the
Leased Property or sublet all or any part of the Leased Property or (b) sublet any retail or restaurant portion of the Leased Improvements with respect to the Leased Property in the normal course of the Primary Intended Use; provided that any
subletting to any party other than an Affiliate of Lessee shall not individually as to any one such subletting, or in the aggregate, materially diminish the actual or potential Percentage Rent payable with respect to the Leased Property under this
Lease. In the case of a subletting, the sublessee shall comply with the provisions of Section 23.2, and in the case of an assignment, the assignee shall assume in writing and agree to keep and perform all of the terms of this Lease on the part
of Lessee to be kept and performed and shall be, and become, jointly and severally liable with Lessee for the performance thereof. Notwithstanding the above, Lessee may assign the Lease to an Affiliate with respect to the Leased Property without the
consent of Lessor; provided that any such assignee assumes in writing and agrees to keep and perform all of the terms of the Lease on the part of Lessee to be kept and performed and shall be and become jointly and severally liable with Lessee for
the performance thereof. In case of either an assignment or subletting made during the Term, Lessee shall remain primarily liable, as principal rather than as surety, for the prompt payment of the Rent and for the performance and observance of all
of the covenants and conditions to be performed by Lessee hereunder. An original counterpart of each such sublease and assignment and assumption, duly executed by Lessee and such sublessee or assignee, as the case may be, in form and substance
satisfactory to Lessor, shall be delivered promptly to Lessor. 
 Section 23.2. Subordination and Attornment. 
 Lessee shall insert in each sublease permitted under Section 23.1 provisions to the effect that (a) such sublease is subject and subordinate to
all of the terms and provisions of this Lease and to the rights of Lessor hereunder (if Lessor executes a non-disturbance agreement with respect thereto), (b) if this Lease terminates before the expiration of such sublease, the sublessee
thereunder will, at Lessor’s option, attorn to Lessor and waive any right the sublessee may have to terminate the sublease or to surrender possession thereunder as a result of the termination of this Lease, and (c) if the sublessee
receives a written Notice from Lessor or Lessor’s assignees, if any, stating that an uncured Event of Default exists under this Lease, the sublessee shall thereafter be obligated to pay all rentals accruing under said sublease directly to the
party giving such Notice, or as such party may direct. All rentals received from the sublessee by Lessor or Lessor’s assignees, if any, as the case may be, shall be credited against the amounts owing by Lessee under this Lease. 
  

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 ARTICLE XXIV 
 Section 24.1. Officer’s Certificates; Financing Statements; Lessor’s Estoppel Certificates and Covenants. 
 (a) At any time and from time to time upon not less than 10 days’ Notice by Lessor, Lessee will furnish to Lessor an Officer’s Certificate certifying that this Lease is unmodified and in full force and
effect (or that this Lease is in full force and effect as modified and setting forth the modifications), the date to which the Rent has been paid, whether to the knowledge of Lessee there is any existing default or Event of Default hereunder by
Lessor or Lessee, and such other information as may be reasonably requested by Lessor. Any such certificate furnished pursuant to this Section may be relied upon by Lessor, any lender and any prospective purchaser of the Leased Property.

 (b) Upon the request of Lessor, Lessee will furnish the following statements to Lessor: 
 (i) with reasonable promptness, such information respecting the financial condition and affairs of Lessee including financial statements,
as Lessor may reasonably request from time to time; and 
 (ii) the most recent Consolidated Financials of Lessee within 45
days after each quarter of any Fiscal Year (or, in the case of the final quarter in any Fiscal Year, the most recent Consolidated Financials of Lessee within 90 days). 
 (c) At any time and from time to time upon not less than 10 days’ Notice by Lessee, Lessor will furnish to Lessee or to any person designated by Lessee an estoppel certificate certifying that this Lease is
unmodified and in full force and effect (or that this Lease is in full force and effect as modified and setting forth the modifications), the date to which Rent has been paid, whether to the knowledge of Lessor there is any existing default or Event
of Default on Lessee’s part hereunder, and such other information as may be reasonably requested by Lessee. 
 ARTICLE XXV 
 Section 25.1. Lessor’s Right to Inspect. 
 Lessee shall permit Lessor and its authorized representatives as frequently as reasonably requested by Lessor to inspect the Leased Property and Lessee’s accounts and records pertaining thereto and make copies
thereof, during usual business hours upon reasonable advance Notice, subject only to any business confidentiality requirements reasonably requested by Lessee. 
  

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 ARTICLE XXVI 
 Section 26.1. No Waiver. 
 No failure by Lessor or Lessee to insist upon the strict performance
of any term hereof or to exercise any right, power or remedy consequent upon a breach thereof, and no acceptance of full or partial payment of Rent during the continuance of any such breach, shall constitute a waiver of any such breach or of any
such term. To the extent permitted by law, no waiver of any breach shall affect or alter this Lease, which shall continue in full force and effect with respect to any other then existing or subsequent breach. 
 ARTICLE XXVII 
 Section 27.1.
Remedies Cumulative. 
 To the extent permitted by law, each legal, equitable or contractual right, power and remedy of Lessor or
Lessee now or hereafter provided either in this Lease or by statute or otherwise shall be cumulative and concurrent and shall be in addition to every other right, power and remedy and the exercise or beginning of the exercise by Lessor or Lessee of
any one or more of such rights, powers and remedies shall not preclude the simultaneous or subsequent exercise by Lessor or Lessee of any or all of such other rights, powers and remedies. 
 ARTICLE XXVIII 
 Section 28.1. Acceptance of Surrender. 
 No surrender to Lessor of this Lease or of the Leased Property or any part thereof, or of any interest therein, shall be valid or effective unless agreed
to and accepted in writing by Lessor and no act by Lessor or any representative or agent of Lessor, other than such a written acceptance by Lessor, shall constitute an acceptance of any such surrender. 
 ARTICLE XXIX 
 Section 29.1. No
Merger of Title. 
 There shall be no merger of this Lease or of the leasehold estate created hereby by reason of the fact that the same
person or entity may acquire, own or hold, directly or indirectly: (a) this Lease or the leasehold estate created hereby or any interest in this Lease or such leasehold estate and (b) the fee estate in the Leased Property. 
  

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 ARTICLE XXX 
 Section 30.1. Conveyance by Lessor. 
 If Lessor or any successor owner of the Leased Property
conveys the Leased Property in accordance with the terms hereof other than as security for a debt, and the grantee or transferee of the Leased Property expressly assumes all obligations of Lessor hereunder arising or accruing from and after the date
of such conveyance or transfer, Lessor or such successor owner, as the case may be, shall thereupon be released from all future liabilities and obligations of Lessor under this Lease arising or accruing from and after the date of such conveyance or
other transfer as to the Leased Property and all such future liabilities and obligations shall thereupon be binding upon the new owner. 
 Section 30.2. Other Interests. 
 This Lease and Lessee’s interest hereunder shall at all times be subject and
subordinate to the lien and security title of any deeds to secure debt, deeds of trust, mortgages, or other interests heretofore or hereafter granted by Lessor or which otherwise encumber or affect the Leased Property and to any and all advances to
be made thereunder and to all renewals, modifications, consolidations, replacements, substitutions, and extensions thereof (all of which are herein called the “Mortgage”); provided, however, that with respect to any Mortgage hereinafter
granted, such subordination is conditioned upon delivery to Lessee of a non-disturbance agreement which provides that Lessee shall not be disturbed in its possession of the Leased Property hereunder following a foreclosure of such Mortgage and that
the holder of such Mortgage or the purchaser at a foreclosure sale shall perform all obligations of Lessor under this Lease. In confirmation of such subordination, however, Lessee shall, at Lessor’s request, promptly execute, acknowledge and
deliver any instrument which may be required to evidence subordination to any Mortgage and to the holder thereof. In the event of Lessee’s failure to deliver such subordination and if the Mortgage does not change any term of the Lease, Lessor
may, in addition to any other remedies for breach of covenant hereunder, execute, acknowledge, and deliver the instrument as the agent or attorney-in-fact of Lessee, and Lessee hereby irrevocably constitutes Lessor its attorney-in-fact for such
purpose, Lessee acknowledging that the appointment is coupled with an interest and is irrevocable. Lessee hereby waives and releases any claim it might have against Lessor or any other party for any actions lawfully taken by the holder of any
Mortgage. 
 ARTICLE XXXI 
 Section 31.1. Quiet Enjoyment. 
 So long as Lessee pays all Rent as the same becomes due and complies with all of the
terms of this Lease and performs its obligations hereunder, in each case within the applicable grace periods, if any, Lessee shall peaceably and quietly have, hold and enjoy the Leased Property for the Term hereof, free of any claim or other action
by Lessor or anyone claiming by, through or under Lessor, but subject to all liens and encumbrances subject to which the Leased Property was conveyed to Lessor or hereafter consented to by Lessee or provided for herein. Notwithstanding the
foregoing, Lessee shall have the right by separate and independent action to pursue any claim it may have against Lessor as a result of a breach by Lessor of the covenant of quiet enjoyment contained in this Section. 
  

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 ARTICLE XXXII 
 Section 32.1. Notices. 
 All notices, demands, requests, consents approvals and other
communications (“Notice” or “Notices”) hereunder shall be in writing and (i) personally served or, (ii) mailed by registered or certified mail, return receipt requested and postage prepaid or, (iii) sent by
trackable overnight nationally recognized courier service, next business day delivery or, (iv) via facsimile, provided (i), (ii) or (iii) are also utilized), if to Lessee or Lessor c/o Highland Hospitality Corporation, 8405 Greensboro
Drive, Suite 500, McLean, Virginia 22102, Attention: President and CEO, facsimile number: (703) 336-4905, with a copy to General Counsel., 8405 Greensboro Drive, Suite 500, McLean, Virginia 22102, facsimile number: (703) 336-4910.
Personally delivered Notice shall be effective upon receipt, Notice given by mail shall be complete at the time of deposit in the U.S. Mail system, Notice given by trackable overnight nationally recognized courier service, next business day delivery
shall be complete at the time of deposit with such courier service, and Notice given by facsimile shall be complete at the time evidenced by the printed verification thereof, provided one of the other methods is also utilized, but any prescribed
period of Notice and any right or duty to do any act or make any response within any prescribed period or on a date certain after the service of such Notice given by mail shall be extended five days. 
 ARTICLE XXXIII 
 Section 33.1.
Appraisers. 
 If it becomes necessary to determine the Fair Market Value of Lessee’s leasehold interest in the Leased Property or
of any other real property or the Fair Market Rental of the Leased Property for any purpose of this Lease, the party required or permitted to give Notice of such required determination shall include in the Notice the name of a person selected to act
as appraiser on its behalf. Within 10 days after Notice, Lessor (or Lessee, as the case may be) shall by Notice to Lessee (or Lessor, as the case may be) appoint a second person as appraiser on its behalf. The appraisers thus appointed, each of whom
must be a member of the American Institute of Real Estate Appraisers (or any successor organization thereto) with at least five years experience in the State appraising property similar to the subject property, shall, within 45 days after the date
of the Notice appointing the first appraiser, proceed to determine, as applicable, the Fair Market Value of the subject property or the Fair Market Rental of the Leased Property as of the relevant date (giving effect to the impact, if any, of
inflation from the date of their decision to the relevant date); provided, however, that if only one appraiser shall have been so appointed, then the determination of such appraiser shall be final and binding upon the parties. If Lessee’s
leasehold interest in the Leased Property is the subject property, to the extent consistent with sound appraisal practice as then existing at the time of any such appraisal, such appraisal shall be made on a basis consistent with the basis on which
the Leased Property was appraised for 
  

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 purposes of determining its Fair Market Value at the time the Leased Property was acquired by Lessor. If two appraisers
are appointed and if the difference between the amounts so determined does not exceed 5% of the lesser of such amounts, then the Fair Market Value or Fair Market Rental shall be an amount equal to 50% of the sum of the amounts so determined. If the
difference between the amounts so determined exceeds 5% of the lesser of such amounts, then such two appraisers shall have 20 days to appoint a third appraiser. If no such appraiser shall have been appointed within such 20 days or within 90 days of
the original request for a determination of Fair Market Value or Fair Market Rental, whichever is earlier, either Lessor or Lessee may apply to any court having jurisdiction to have such appointment made by such court. Any appraiser appointed by the
original appraisers or by such court shall be instructed to determine the Fair Market Value or Fair Market Rental within 45 days after appointment of such appraiser. The determination of the appraiser which differs most in the terms of dollar amount
from the determinations of the other two appraisers shall be excluded, and 50% of the sum of the remaining two determinations shall be final and binding upon Lessor and Lessee as the Fair Market Value of the subject property or the Fair Market
Rental of the Leased Property, as the case may be. This provision for determining by appraisal shall be specifically enforceable to the extent such remedy is available under applicable law, and any determination hereunder shall be final and binding
upon the parties except as otherwise provided by applicable law. Lessor and Lessee shall each pay the fees and expenses of the appraiser appointed by it and each shall pay one-half of the fees and expenses of the third appraiser and one-half of all
other costs and expenses incurred in connection with each appraisal. 
 ARTICLE XXXIV 
 Section 34.1. Lessor May Grant Liens. 
 Without the consent of Lessee, Lessor may, subject to the terms and conditions set forth below in this Article XXXIV, from time to time, directly or indirectly, create or otherwise cause to exist any lien, encumbrance or title
retention agreement (“Encumbrance”) upon the Leased Property, or any portion thereof or interest therein, whether to secure any borrowing or other means of financing or refinancing. Any such Encumbrance may (a) contain the right to
prepay (whether or not subject to a prepayment penalty); (b) provide that it is subject to the rights of Lessee under this Lease and (c) contain the Agreement by the holder of the Encumbrance that it will (1) give Lessee the same
notice, if any, given to Lessor of any default or acceleration of any obligation underlying any such Encumbrance or any sale in foreclosure under such Encumbrance, (2) permit Lessee to cure any such default on Lessor’s behalf within any
applicable cure period, and Lessee shall be reimbursed by Lessor for any and all costs incurred in effecting such cure, including without limitation out-of-pocket costs incurred to effect any such cure (including reasonable attorneys’ fees) and
(3) permit Lessee to appear by its representative and to bid at any sale in foreclosure made with respect to any such Encumbrance. Upon the request of Lessor, Lessee shall subordinate this Lease to the lien of a new mortgage on the Leased
Property, on the condition that the proposed mortgagee executes a non-disturbance agreement recognizing this Lease, and agreeing, for itself and its successors and assigns, to comply with the provisions of this Article XXXIV. 
  

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 Section 34.2. Lessee’s Right to Cure. 
 Subject to the provisions of Section 34.3, if Lessor breaches any covenant to be performed by it under this Lease, Lessee, after Notice to and demand
upon Lessor, without waiving or releasing any obligation hereunder, and in addition to all other remedies available to Lessee, may (but shall be under no obligation at any time thereafter to) make such payment or perform such act for the account and
at the expense of Lessor. All sums so paid by Lessee and all costs and expenses (including, without limitation, reasonable attorneys’ fees) so incurred, together with interest thereon at the Overdue Rate from the date on which such sums or
expenses are paid or incurred by Lessee, shall be paid by Lessor to Lessee on demand or, following entry of a final, nonappealable judgment against Lessor for such sums, may be offset by Lessee against the Base Rent payments next accruing or coming
due. The rights of Lessee hereunder to cure and to secure payment from Lessor in accordance with this Section 34.2 shall survive the termination of this Lease with respect to the related Leased Property. 
 Section 34.3. Breach by Lessor. 
 It shall be a breach of this Lease if Lessor fails to observe or perform any term, covenant or condition of this Lease on its part to be performed and such failure continues for a period of 30 days after Notice thereof from Lessee, unless
such failure cannot with due diligence be cured within a period of 30 days, in which case such failure shall not be deemed to continue if Lessor, within such 30-day period, proceeds promptly and with due diligence to cure the failure and diligently
completes the curing thereof. The time within which Lessor shall be obligated to cure any such failure also shall be subject to extension of time due to the occurrence of Force Majeure. If Lessor fails to cure any such breach within the grace period
described above, Lessee, without waiving or releasing any obligations hereunder, and in addition to all other remedies available to Lessee at law or in equity, may purchase the Leased Property (or such portion thereof as the breach relates to) from
Lessor for a purchase price equal to the then Fair Market Value. If Lessee elects to purchase the Leased Property (or portion thereof), it shall deliver a Notice thereof to Lessor specifying a settlement date to occur not less than 90 days
subsequent to the date of such Notice on which it shall purchase the Leased Property (or portion thereof), and the same shall be thereupon conveyed in accordance with the provisions of Article XVIII. 
 ARTICLE XXXV 
 Section 35.1.
Miscellaneous. 
 Anything contained in this Lease to the contrary notwithstanding, all claims against, and liabilities of, Lessee or
Lessor arising prior to any date of termination of this Lease shall survive such termination. If any term or provision of this Lease or any application thereof is invalid or unenforceable, the remainder of this Lease and any other application of
such term or provisions shall not be affected thereby. If any late charges or any interest rate provided for in any provision of this Lease are based upon a rate in excess of the maximum rate permitted by applicable law, the parties agree that such
charges shall be fixed at the maximum permissible rate. Neither this Lease nor any provision hereof may be changed, waived, discharged or 
  

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 terminated except by a written instrument in recordable form signed by Lessor and Lessee. All the terms and provisions of
this Lease shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. The headings in this Lease are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.
This Lease shall be governed by and construed in accordance with the laws of the State, but not including its conflicts of laws or rules. 
 Section 35.2. Transition Procedures. 
 Upon the expiration or termination of the Term, for whatever reason, Lessor and
Lessee shall do the following (and the provisions of this Section 35.2 shall survive the expiration or termination of this Lease until they have been fully performed) and, in general, shall cooperate in good faith to effect an orderly
transition of the management and/or lease of the Hotel. 
 (a) Transfer of Licenses. Upon the expiration or earlier termination of the
Term, Lessee shall use commercially reasonable efforts (i) to transfer to Lessor or Lessor’s nominee all licenses, operating permits and other governmental authorizations and all contracts, including contracts with governmental or
quasi-governmental entities, that may be necessary for the operation of the Hotel (collectively, “Licenses”), or (ii) if such transfer is prohibited by law or Lessor otherwise elects, to cooperate with Lessor or Lessor’s nominee
in connection with the processing by Lessor or Lessor’s nominee of any applications for, all Licenses; provided, in either case, that the costs and expenses of any such transfer or the processing of any such application shall be paid by Lessor
or Lessor’s nominee. 
 (b) Leases and Concessions. Lessee shall assign to Lessor or Lessor’s nominee simultaneously with
the termination of this Lease, and the assignee shall assume all leases and concession agreements in effect with respect to the Hotel then in Lessee’s name. 
 (c) Books and Records. All books and records for the Hotel kept by Lessee pursuant to Section 3.7 shall be delivered promptly to Lessor or Lessor’s nominee, simultaneously with the termination of this
Lease, but such books and records shall thereafter be available to Lessee at all reasonable times for inspection, audit, examination, and transcription for a period of one (1) year and Lessee may retain (on a confidential basis) copies or
computer records thereof. 
 Section 35.3. Waiver of Presentment, etc. 
 Lessee waives all presentments, demands for payment and for performance, notices of nonperformance, protests, notices of protest, notices of dishonor, and
notices of acceptance and waives all notices of the existence, creation, or incurring of new or additional obligations, except as expressly granted herein. 
  

 58 

 ARTICLE XXXVI 
 Section 36.1. Memorandum of Lease. 
 Lessor and Lessee shall promptly upon the request of either
enter into a short form memorandum of this Lease, in form suitable for recording under the laws of the State in which reference to this Lease, and all options contained herein, shall be made. The party requesting such memorandum of this Lease shall
pay all costs and expenses of recording such memorandum, including any real estate excise transfer or sales tax that may be due and payable in conjunction with recording such memorandum. 
 ARTICLE XXXVII 
 Section 37.1. Compliance with Franchise Agreement.

 Lessor will pay any costs and expenses in connection with the assignment of any existing Franchise Agreement to Lessee or to obtain a new
Franchise Agreement. Lessee shall comply in every respect with the provisions of the Franchise Agreement so as to avoid any default thereunder during the term of this Lease, except to the extent such compliance is an obligation of Lessor pursuant to
the terms of this Lease. Lessee shall not terminate, extend, modify or enter into any Franchise Agreement without in each instance first obtaining Lessor’s prior written consent, not to be unreasonably withheld. Lessor and Lessee agree to
cooperate fully with each other in the event it becomes necessary to obtain a Franchise Agreement extension or modification or a new franchise for the Leased Property. If a Franchise Agreement expires prior to the expiration of the Term for the
related Leased Property, Lessee, with the prior approval of Lessor, shall use its good faith efforts to obtain a new franchise license for the Leased Property, together with a comfort letter in favor of Lessor in form reasonably acceptable to
Lessor. 
 ARTICLE XXXVIII 
 [Intentionally Left Blank] 
 ARTICLE XXXIX 
 Section 39.1. Arbitration. 
 Except as otherwise expressly provided, in the event a dispute
should arise concerning the interpretation or application of any of the provisions of this Lease, the parties agree that the dispute shall be submitted to arbitration of the American Arbitration Association under its then prevailing rules, except as
modified by this Article XXXIX. The Arbitration Tribunal shall be formed of three (3) Arbitrators each of which shall have at least five (5) years’ experience in hotel operation, management or ownership, one (1) to be appointed
by each of Lessor and Lessee and the third (3rd) to be appointed by the American Arbitration Association. The arbitration 
  

 59 

 shall take place in the county in which the Leased Property is located and shall be conducted in the English language.
The arbitration award shall be final and binding upon the parties hereto and subject to no appeal, and shall deal with the question of costs of arbitration and all matters related thereto. Judgment upon the award rendered may be entered into any
court having jurisdiction, or applications may be made to such court for an order of enforcement. Any arbitration under this Article XXXIX shall be submitted within three (3) months following the notice which triggers the arbitration, and shall
be concluded within one (1) year thereafter. In the event either of the foregoing deadlines are missed, either party may proceed to commence a court proceeding to resolve the dispute. 
 ARTICLE XL 
 Section 40.1. Sale and Termination of Lease. 
 In the event Lessor enters into a contract to sell its interest in the Leased Property, Lessor may terminate this Lease by giving thirty (30) days
prior Notice to Lessee, and then, as of the closing of such sale, this Lease shall terminate and be of no further force and effect except as to any obligations existing as of such date that survive termination of this Lease, and all Rent shall be
adjusted as of such date. As compensation for the early termination of Lessee’s leasehold estate hereunder, Lessor shall, at Lessor’s election: 
 (a) pay to Lessee a termination payment equal to the Fair Market Value of Lessee’s leasehold estate in the Hotel (a “Termination Payment”), which Termination Payment shall be paid by Lessor to Lessee
within eighteen (18) months after the termination of this Lease; or 
 (b) within eighteen (18) months after termination of this
Lease, offer to lease to Lessee, or cause Lessee to be offered the opportunity to lease, one or more substitute hotel facilities comparable to the Hotel (i.e., comparable market and substantially similar class, quality and condition of property)
pursuant to one or more leases (“Substitute Leases”) that would create for Lessee leasehold estates that have an aggregate Fair Market Value of no less than the Termination Payment that otherwise would be payable with respect to the Fair
Market Value of Lessee’s leasehold estate in the Hotel. 
 In the event Lessor subsequently elects and complies with the option
described in (b) above, the Substitute Leases shall not take into account the amount of the Termination Payment accrued to the date the Substitute Leases are entered into and Lessor shall have no further responsibility or obligation with
respect to the Termination Payment. If Lessor elects and complies with the option described in (b) above, regardless of whether Lessee enters into any of the Substitute Leases, Lessor shall have no further obligations to Lessee with respect to
compensation for the early termination of this Lease. 
  

 60 

 IN WITNESS WHEREOF, the parties have executed this Lease under seal by their duly authorized officers as
of the date first above written. 
  

			
	LESSOR
	
	                                      
                                      ,
	
	 a
                                        
                                       
 

		
	By:	 	  

	Printed Name:	 	  

	Title:	 	  

	
	LESSEE
	
	                                      
                                      ,
	
	a
                                        
                                       
 
		
	By:	 	  

	Printed Name:	 	  

	Title:	 	  

  

 61 

 EXHIBIT A 
 LEGAL DESCRIPTIONS 
 [Attached] 
  

 A-1 

 EXHIBIT B 
 [TERM] 
 [COMMENCEMENT DATE] 
  

 B-1 

 EXHIBIT C 
 THIS IS A EXCEL DOCUMENT 
  

 C-1

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