Document:

Moody National Advisor I, LLC. 10-Q

EXHIBIT
10.7

 

GUARANTY
OF RECOURSE OBLIGATIONS

 

This GUARANTY OF
RECOURSE OBLIGATIONS (as amended, restated, replaced, supplemented or otherwise modified from time to time, this “Guaranty”)
is executed as of March 31, 2014 by BRETT C. MOODY, a natural person, having an address at 5 Derham Parc, Houston, Texas
77024 (together with his permitted successors and assigns, “Guarantor”), for the benefit of LADDER CAPITAL
FINANCE LLC, a Delaware limited liability company, having an address at 345 Park Avenue, 8th Floor, New York, New
York 10154 (together with its successors and assigns, collectively, “Lender”).

 

W I
T N E S S E T H:

 

A.     Pursuant
to that certain Promissory Note, dated of even date herewith, executed by Moody National 2020-Grapevine Holding, LLC, a Delaware
limited liability company (together with its permitted successors and assigns, collectively, “Borrower”) and
payable to the order of Lender in the original principal amount of THIRTEEN MILLION TWO HUNDRED FIFTY THOUSAND and 00/100 ($13,250,000.00)
(together with all renewals, modifications, increases and extensions thereof, the “Note”), Borrower has become
indebted, and may from time to time be further indebted, to Lender with respect to a loan (the “Loan”) which
is made pursuant to that certain Loan Agreement, dated of even date herewith, between Borrower and Lender (as the same may be
amended, modified, supplemented, replaced or otherwise modified from time to time, the “Loan Agreement”), which
Loan is secured by that certain Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing of even date
herewith (as the same may be amended, restated, replaced, supplemented, or otherwise modified from time to time, the “Mortgage”),
and further evidenced, secured or governed by other instruments and documents executed in connection with the Loan. Capitalized
terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Loan Agreement.

 

B.      Lender
is not willing to make the Loan, or otherwise extend credit, to Borrower unless Guarantor unconditionally guarantees payment and
performance to Lender of the Guaranteed Obligations (as herein defined).

 

C.      Guarantor
is the owner of direct or indirect interests in Borrower, and, therefore, Guarantor will directly benefit from Lender making the
loan to Borrower.

 

NOW, THEREFORE, as
an inducement to Lender to make the Loan to Borrower and to extend such additional credit as Lender may from time to time agree
to extend under the Loan Documents, and for other good and valuable consideration, the receipt and legal sufficiency of which
are hereby acknowledged, the parties do hereby agree as follows:

 

    	 

    	 

    

 

ARTICLE
1

NATURE
AND SCOPE OF GUARANTY

 

Section 1.1       Guaranty
of Obligations. Guarantor hereby irrevocably and unconditionally guarantees to Lender and its successors and assigns the payment
and performance of the Guaranteed Obligations as and when the same shall be due and payable, whether by lapse of time, by acceleration
of maturity or otherwise. Guarantor hereby irrevocably and unconditionally covenants and agrees that it is liable for the Guaranteed
Obligations as a primary obligor.

 

Section 1.2       Definition
of Guaranteed Obligations.

 

(a)      Guarantor
hereby assumes liability as a primary obligor for, hereby unconditionally guarantees payment to Lender of, hereby agrees to pay,
protect, defend and save Lender harmless from and against, and hereby indemnifies Lender from and against, any and all liabilities,
obligations, losses, damages (including those resulting from the diminution in value of the Property, to the extent of any deficiency
in respect of the Guaranteed Obligations), costs and expenses (including, without limitation, attorneys’ fees and costs),
causes of action, suits, claims, demands and judgments, of any nature or description whatsoever, which may at any time be imposed
upon, incurred by or awarded against Lender as a result of any of the following:

 

(i)       the
breach of any representation, warranty, covenant or indemnification provision in the Environmental Indemnity, the Mortgage or
any other Loan Document concerning environmental laws, hazardous substances and asbestos and any indemnification of Lender with
respect thereto in any such document;

 

(ii)      material
physical waste or, after the occurrence and during the continuance of an Event of Default, the removal or disposal of any portion
of the Property without replacement in accordance with the Loan Documents;

 

(iii)     the
misapplication, misappropriation or conversion by Borrower or Master Tenant of (A) any Insurance Proceeds paid by reason of any
loss, damage or destruction to the Property, (B) any Awards or other amounts received in connection with the Condemnation of all
or a portion of the Property, (C) any Gross Revenues (including, without limitation, lease termination payments and any security
deposits, advance deposits or any other deposits collected with respect to the Property (including the failure to deliver any
such deposits to Lender upon a foreclosure of the Property or an action in lieu thereof, except to the extent any such deposits
were applied in accordance with the terms and conditions of the applicable Lease), or (D) Reserve Funds disbursed to Borrower
in accordance with Section 6.11.3(b) of the Loan Agreement and not promptly remitted to the applicable Governmental Authorities;

 

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(iv)     the
failure to pay charges for labor or materials or other charges that can create Liens on the Property, to the extent such Liens
are not bonded over or discharged in accordance with the Loan Documents and to the extent that Gross Revenues of the Property
net of all Cash Flow Requirements (as hereinafter defined) actually paid are sufficient to pay such amounts, provided that the
foregoing shall not apply to the extent that during the continuance of a sweep of Excess Cash Flow pursuant to Section 6.9 of
the Loan Agreement there are sufficient funds as aforesaid however Lender has not made such funds available to Borrower or Master
Tenant to pay the charges described above. As used in this clause (iv), Cash Flow Requirements, with respect to charges for labor
or materials or other charges that can create Liens on the Property, such charges shall only be included in such definition if
they are for normal, day-to-day and customary expenses of owning and operating the Property and not for Extraordinary Expenses
or Capital Expenditures unless the same have been approved by Lender;

 

(v)      the
failure to pay Taxes, to the extent that the Master Tenant is not timely paying same and to the extent that Gross Revenues of
the Property, net of all Cash Flow Requirements actually paid, are sufficient to pay such Taxes, provided that the foregoing shall
not apply to the extent that Lender has not paid Taxes to the extent that Tax Funds are held in the Tax Account pursuant to Section
6.3 of the Loan Agreement and provided further that the foregoing shall not apply to the extent that (A) Guarantor would
otherwise be liable under this subsection (v) and (B) during the continuance of a Cash Trap Period, Lender has not made funds
available to Borrower to pay the Taxes described above;

 

(vi)     the
failure to obtain and maintain the fully paid for Policies in accordance with Section 5.1 of the Loan Agreement to the
extent that the Master Tenant is not timely paying the Insurance Premiums when due or maintaining the same and to the extent that
Gross Revenues of the Property, net of all Cash Flow Requirements actually paid, are sufficient to pay such Insurance Premiums
when due, provided that the foregoing shall not apply to the extent that Lender has not paid Insurance Premiums to the extent
that Insurance Funds are held in the Insurance Account pursuant to Section 6.4 of the Loan Agreement and provided further that
the foregoing shall not apply to the extent that (A) Guarantor would otherwise be liable under this subsection (vi) and (B)
during the continuance of a Cash Trap Period, Lender has not made funds available to Borrower to pay the Insurance Premiums described
above;

 

(vii)    the
commission of a criminal act by Borrower, Master Tenant, or any Guarantor;

 

(viii)   any
exercise by Master Tenant of any right of set-off or abatement with respect to Base Rent (as defined in the Master Lease) as a
result of a default by Borrower over which Borrower has control under the Master Lease and to the extent that Gross Revenues of
the Property, net of all Cash Flow Requirements actually paid, are sufficient to pay such amounts as would have been required
to be paid by Borrower to avert such setoff or abatement provided that the foregoing shall not apply to the extent that (A) Guarantor
would otherwise be liable under this subsection (viii) and (B) during the continuance of a sweep of a Cash Trap Period, Lender
has not made funds available to Borrower to pay the charges described above;

 

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(ix)     the
amendment or modification of the Master Lease, in each case without Lender’s prior written consent;

 

(x)      any
intentional misrepresentation in the provisions of Section 3.1.45 of the Loan Agreement unless such misrepresentation can be cured
by Borrower, Master Tenant, or Guarantor promptly without harm to Lender or the Collateral; 

 

(xi)     (A)
Borrower fails to comply with any representation, warranty or covenant set forth in Sections 3.1.24 or 4.1.15 of the Loan Agreement
(unless such breach results in the substantive consolidation of the assets of Borrower with the assets of another Person in a
bankruptcy, insolvency or similar proceeding of any other Person as referred to in sub-paragraph 1.2(b)(iii)(A) below) or (B)
Master Tenant fails to comply with any representation, warranty or covenant set forth in Section 12 of the Master Lease Subordination
Agreement with regard to Master Tenant’s qualification as a Special Purpose Entity (unless such breach results in the substantive
consolidation of the assets of Master Tenant with the assets of another Person in a bankruptcy, insolvency or similar proceeding
of any other Person as referred to in sub-paragraph 1.2(b)(iii)(B) below); or

 

(xii)    Intentionally
omitted;

 

(xiii)   in
connection with the Loan or the Property (including, without limitation, any Lease), Borrower, Master Tenant, any Guarantor, or
any Affiliate of Borrower, Master Tenant, or of any Guarantor that is controlled by Guarantor, engages in any action constituting
an intentional material misrepresentation or gross negligence; or

 

(xiv)   the
termination, surrender or cancellation of the Franchise Agreement by Master Tenant without Lender’s prior written consent
or the termination or cancellation of the Franchise Agreement by Franchisor (as a result of the action or omission of Borrower
or Master Tenant) prior to the expiration date of the Franchise Agreement unless such termination or cancellation is solely the
result of Master Tenant’s failure to pay the franchise fees and other charges due under the Franchise Agreement and such
failure to pay is solely the result of Gross Revenues of the Property, net of all Cash Flow Requirements actually paid, being
insufficient to pay such amounts provided that the foregoing shall not apply to the extent that (A) Guarantor would otherwise
be liable under this subsection (xiv) and (B) during the continuance of a Cash Trap Period, Lender has not made funds available
to Borrower to pay the charges described above.

 

As used herein, the
term “Cash Flow Requirements” shall collectively mean all Debt Service for a particular period and any other
amounts payable to Lender hereunder or under the other Loan Documents for such period, or otherwise due and payable in respect
of the ownership and operation of the Property during such period.

 

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Notwithstanding anything
to the contrary contained herein, Guarantor shall have no personal liability for losses suffered as a result of (1) the failure
to timely pay Taxes, (2) the failure to obtain and maintain fully paid for Policies in accordance with Section 5.1 of the Loan
Agreement, (3) the failure to pay for labor or materials or other charges that actually create Liens on the Property or (4) the
termination of the Franchise Agreement solely due to the Master Tenant’s failure to pay the franchise fees and other charges
due under the Franchise Agreement so long as any such failure to pay arises during the continuance of a Cash Trap Period and Lender
has not made funds available to Borrower or Master Tenant to pay the Taxes, Insurance Premiums, charges which result in Liens
or franchise fees and other charges due under the Franchise Agreement, as the case may be.

 

(b)      In
addition to, and without limiting the generality of, the foregoing clause (a), and notwithstanding anything to the contrary set
forth in this Guaranty or in any of the other Loan Documents, Guarantor hereby acknowledges and agrees that the Obligations shall
be fully recourse to Guarantor in the event that:

 

(i)       in
connection with the Loan or the Property (including, without limitation, any Lease), Borrower, Master Tenant, any Guarantor or
any Affiliate of Borrower, Master Tenant, or of any Guarantor that is controlled by any Guarantor, engages in any action constituting
fraud or willful misconduct;

 

(ii)      the
first Monthly Debt Service Payment under the Note is not paid in full when due;

 

(iii)     (A)
Borrower fails to comply with any representation, warranty or covenant set forth in Sections 3.1.24 or 4.1.15 of
the Loan Agreement and such failure results in the substantive consolidation of the assets of Borrower with the assets of another
Person in a bankruptcy, insolvency or similar proceeding of any other Person or (B) Master Tenant fails to comply with any representation,
warranty or covenant set forth in Section 12 of the Master Lease Subordination Agreement with regard to Master Tenant’s
qualification as a Special Purpose Entity and such failure results in the substantive consolidation of the assets of Master Tenant
with the assets of another Person in a bankruptcy, insolvency or similar proceeding of any other Person;

 

(iv)     Borrower
or Master Tenant fails to obtain Lender’s prior consent to any voluntary Lien encumbering the Property or any portion thereof
or interest therein, except to the extent expressly permitted by the Loan Documents;

 

(v)      Borrower
or Master Tenant fails to obtain Lender’s prior consent to any voluntary Transfer by Borrower or by any Restricted Party
controlled by Borrower or Guarantor, except to the extent expressly permitted by the Loan Documents;

 

(vi)     Borrower
or Master Tenant files a voluntary petition under the Bankruptcy Code or any other federal, state, local or foreign bankruptcy
or insolvency law;

 

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(vii)   an
Affiliate, officer, director or representative which controls, directly or indirectly, Borrower or Master Tenant files, or joins
in the filing of, an involuntary petition against Borrower and/or Master Tenant under the Bankruptcy Code or any other federal,
state, local or foreign bankruptcy or insolvency law, or solicits or causes to be solicited petitioning creditors for any involuntary
petition against Borrower and/or Master Tenant from any Person;

 

(viii)  Borrower
and/or Master Tenant files an answer consenting to, or otherwise acquiescing in, or joining in, any involuntary petition filed
against it, by any other Person under the Bankruptcy Code or any other federal, state, local or foreign bankruptcy or insolvency
law, or solicits or causes to be solicited petitioning creditors for any involuntary petition from any Person;

 

(ix)     any
Affiliate, officer, director or representative which controls Borrower and/or Master Tenant consents to, or acquiesces in, or
joins in, an application (other than by or on behalf of Lender) for the appointment of a custodian, receiver, trustee or examiner
for Borrower, Master Tenant or any portion of the Property;

 

(x)      Borrower
or Master Tenant makes an assignment for the benefit of creditors; or

 

(xi)     the
termination, cancellation, or surrender of the Master Lease, in each case without Lender’s prior written consent; or

 

(xii)    Borrower,
Master Tenant, or any Guarantor (or any Person comprising Borrower, Master Tenant, or any Guarantor), or any Affiliate
of any of the foregoing under the control of Borrower, Master Tenant, or Guarantor, in connection with any enforcement action
or exercise or assertion of any right or remedy by or on behalf of Lender under or in connection with the Note, the Mortgage,
the Guaranty or any other Loan Document, seeks a defense, judicial intervention or injunctive or other equitable relief of any
kind or asserts in a pleading filed in connection with a judicial proceeding any defense against Lender or any right in connection
with any security for the Loan, which is frivolous, brought in bad faith, or wholly without merit (in the case of a defense).

 

As used in this Section 1.2,
the term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of
the management, policies or activities of a Person, whether through ownership of voting securities, by contract or otherwise.

 

(c)      The
obligations of Guarantor set forth in clauses (a), (b) and (c) of this Section 1.2, as and to the
extent set forth in said clauses (a), (b) and (c) of this Section 1.2, are hereinafter collectively
referred to as the “Guaranteed Obligations”.

 

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(d)      Notwithstanding
anything to the contrary in this Guaranty or in any of the other Loan Documents, Lender shall not be deemed to have waived any
right which Lender may have under Section 506(a), 506(b), 1111(b) or any other provisions of the Bankruptcy Code to file a claim
for the full amount of the Obligations or to require that all collateral shall continue to secure all of the Obligations owing
to Lender in accordance with the Loan Documents.

 

Section 1.3       Nature
of Guaranty. This Guaranty is an irrevocable, absolute, continuing guaranty of payment and performance and not a guaranty
of collection. This Guaranty may not be revoked by Guarantor and shall continue to be effective with respect to any Guaranteed
Obligations arising or created after any attempted revocation by Guarantor and after (if Guarantor is a natural person) Guarantor’s
death (in which event this Guaranty shall be binding upon Guarantor’s estate and Guarantor’s legal representatives
and heirs). The fact that at any time or from time to time the Guaranteed Obligations may be increased or reduced shall not release
or discharge the obligation of Guarantor to Lender with respect to the Guaranteed Obligations. This Guaranty may be enforced by
Lender and any subsequent holder of the Note and shall not be discharged by the assignment, sale, pledge, transfer, participation
or negotiation of all or part of the Note.

 

Section 1.4       Guaranteed
Obligations Not Reduced by Offset. The Guaranteed Obligations and the liabilities and obligations of Guarantor to Lender hereunder
shall not be reduced, discharged or released because or by reason of any existing or future offset, claim or defense of Borrower
or any other party against Lender or against payment of the Guaranteed Obligations, whether such offset, claim or defense arises
in connection with the Guaranteed Obligations (or the transactions creating the Guaranteed Obligations) or otherwise.

 

Section 1.5       Payment
By Guarantor. If all or any part of the Guaranteed Obligations shall not be paid when due, whether at demand, maturity, acceleration
or otherwise, Guarantor shall, immediately upon demand by Lender and without presentment, protest, notice of protest, notice of
non-payment, notice of intention to accelerate the maturity, notice of acceleration of the maturity or any other notice whatsoever,
all such notices being hereby waived by Guarantor, pay in lawful money of the United States of America, the amount due in respect
of the Guaranteed Obligations to Lender at Lender’s address as set forth herein. Such demand(s) may be made at any time
coincident with or after the time for payment of all or part of the Guaranteed Obligations and may be made from time to time with
respect to the same or different items of Guaranteed Obligations. Such demand shall be deemed made, given and received in accordance
with the notice provisions hereof.

 

Section 1.6       No
Duty To Pursue Others. It shall not be necessary for Lender (and Guarantor hereby waives any rights which Guarantor may have
to require Lender), in order to enforce the obligations of Guarantor hereunder, first to (i) institute suit or exhaust its remedies
against Borrower or others liable on the Loan or the Guaranteed Obligations or any other Person, (ii) enforce Lender’s rights
against any collateral which shall ever have been given to secure the Loan, (iii) enforce Lender’s rights against any other
guarantors of the Guaranteed Obligations, (iv) join Borrower or any others liable on the Guaranteed Obligations in any action
seeking to enforce this Guaranty, (v) exhaust any remedies available to Lender against any collateral which shall ever have been
given to secure the Loan, or (vi) resort to any other means of obtaining payment of the Guaranteed Obligations. Lender shall not
be required to mitigate damages or take any other action to reduce, collect or enforce the Guaranteed Obligations.

 

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Section 1.7       Waivers.
Guarantor agrees to the provisions of the Loan Documents and hereby waives notice of (i) any loans or advances made by Lender
to Borrower, (ii) acceptance of this Guaranty, (iii) any amendment or extension of the Note, the Mortgage, the Loan Agreement
or any other Loan Document, (iv) the execution and delivery by Borrower and Lender of any other loan or credit agreement or of
Borrower’s execution and delivery of any promissory note or other document arising under the Loan Documents or in connection
with the Property, (v) the occurrence of (A) any breach by Borrower of any of the terms or conditions of the Loan Agreement or
any of the other Loan Documents, or (B) an Event of Default, (vi) Lender’s transfer, sale, assignment, pledge, participation
or disposition of the Guaranteed Obligations, or any part thereof, (vii) the sale or foreclosure (or posting or advertising for
sale or foreclosure) of any collateral for the Guaranteed Obligations, (viii) protest, proof of non-payment or default by Borrower,
or (ix) any other action at any time taken or omitted by Lender and, generally, except as expressly provided herein or in another
Loan Document, all demands and notices of every kind in connection with this Guaranty, the Loan Documents, any documents or agreements
evidencing, securing or relating to any of the Guaranteed Obligations and/or the obligations hereby guaranteed.

 

Section 1.8     Payment
of Expenses. In the event that Guarantor should breach or fail to timely perform any provisions of this Guaranty, Guarantor
shall, immediately upon demand by Lender, pay Lender all costs and expenses (including court costs and attorneys’ fees)
incurred by Lender in the enforcement hereof or the preservation of Lender’s rights hereunder, together with interest thereon
at the Default Rate from the date requested by Lender until the date of payment to Lender. The covenant contained in this Section
shall survive the payment and performance of the Guaranteed Obligations.

 

Section 1.9      Effect
of Bankruptcy. In the event that pursuant to any insolvency, bankruptcy, reorganization, receivership or other debtor relief
law or any judgment, order or decision thereunder, Lender must rescind or restore any payment or any part thereof received by
Lender in satisfaction of the Guaranteed Obligations, as set forth herein, any prior release or discharge from the terms of this
Guaranty given to Guarantor by Lender shall be without effect and this Guaranty shall remain (or shall be reinstated to be) in
full force and effect. It is the intention of Borrower and Guarantor that Guarantor’s obligations hereunder shall not be
discharged except by Guarantor’s performance of such obligations and then only to the extent of such performance.

 

Section 1.10     Waiver
of Subrogation, Reimbursement and Contribution. Notwithstanding anything to the contrary contained in this Guaranty, Guarantor
hereby unconditionally and irrevocably waives, releases and abrogates, until such time as the Obligations have been satisfied
in full, any and all rights it may now or hereafter have under any agreement, at law or in equity (including, without limitation,
any law subrogating the Guarantor to the rights of Lender), to assert any claim against or seek contribution, indemnification
or any other form of reimbursement from Borrower or any other party liable for payment of any or all of the Guaranteed Obligations
for any payment made by Guarantor under or in connection with this Guaranty or otherwise.

 

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Section 1.11    Borrower.
The term “Borrower” as used herein shall include any new or successor corporation, association, partnership
(general or limited), limited liability company joint venture, trust or other individual or organization formed as a result of
any merger, reorganization, sale, transfer, devise, gift or bequest of Borrower or any interest in Borrower, as permitted under
the Loan Agreement.

 

ARTICLE
2

EVENTS
AND CIRCUMSTANCES NOT REDUCING

OR
DISCHARGING GUARANTOR’S OBLIGATIONS

 

Guarantor hereby consents
and agrees to each of the following and agrees that Guarantor’s obligations under this Guaranty shall not be released, diminished,
impaired, reduced or adversely affected by any of the following and waives any common law, equitable, statutory or other rights
(including without limitation rights to notice) which Guarantor might otherwise have as a result of or in connection with any
of the following:

 

Section 2.1       Modifications/Sales.
Any renewal, extension, increase, modification, alteration or rearrangement of all or any part of the Guaranteed Obligations,
the Note, the Mortgage, the Loan Agreement, the other Loan Documents or any other document, instrument, contract or understanding
between Borrower and Lender or any other parties pertaining to the Guaranteed Obligations, or any sale, assignment or foreclosure
of the Note, the Loan Agreement, the Mortgage, or any other Loan Documents or any sale or transfer of the Property, or any failure
of Lender to notify Guarantor of any such action.

 

Section 2.2       Adjustment.
Any adjustment, indulgence, forbearance or compromise that might be granted or given by Lender to Borrower or any Guarantor.

 

Section 2.3       Condition
of Borrower or Guarantor. The insolvency, bankruptcy, arrangement, adjustment, composition, liquidation, disability, dissolution
or lack of power of Borrower, Guarantor or any other Person at any time liable for the payment of all or part of the Guaranteed
Obligations; or any dissolution of Borrower or Guarantor or any sale, lease or transfer of any or all of the assets of Borrower
or Guarantor or any changes in the shareholders, partners or members, as applicable, of Borrower or Guarantor; or any reorganization
of Borrower or Guarantor.

 

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Section 2.4       Invalidity
of Guaranteed Obligations. The invalidity, illegality or unenforceability of all or any part of the Guaranteed Obligations
or any document or agreement executed in connection with the Guaranteed Obligations for any reason whatsoever, including without
limitation the fact that (i) the Guaranteed Obligations or any part thereof exceeds the amount permitted by Legal Requirements,
(ii) the act of creating the Guaranteed Obligations or any part thereof is ultra vires, (iii) the officers or representatives
executing the Note, the Mortgage, the Loan Agreement or the other Loan Documents or otherwise creating the Guaranteed Obligations
acted in excess of their authority, (iv) the Guaranteed Obligations violate applicable usury laws, (v) the Borrower has valid
defenses, claims or offsets (whether at law, in equity or by agreement) which render the Guaranteed Obligations wholly or partially
uncollectible from Borrower, (vi) the creation, performance or repayment of the Guaranteed Obligations (or the execution, delivery
and performance of any document or instrument representing part of the Guaranteed Obligations or executed in connection with the
Guaranteed Obligations or given to secure the repayment of the Guaranteed Obligations) is illegal, uncollectible or unenforceable,
or (vii) the Note, the Mortgage, the Loan Agreement or any of the other Loan Documents have been forged or otherwise are irregular
or not genuine or authentic, it being agreed that Guarantor shall remain liable hereon regardless of whether Borrower or any other
Person be found not liable on the Guaranteed Obligations or any part thereof for any reason.

 

Section 2.5       Release
of Obligors. Any full or partial release of the liability of Borrower for the Guaranteed Obligations or any part thereof,
or of any co-guarantors, or any other Person now or hereafter liable, whether directly or indirectly, jointly, severally, or jointly
and severally, to pay, perform, guarantee or assure the payment of the Guaranteed Obligations, or any part thereof, it being recognized,
acknowledged and agreed by Guarantor that Guarantor may be required to pay the Guaranteed Obligations in full without assistance
or support from any other Person, and Guarantor has not been induced to enter into this Guaranty on the basis of a contemplation,
belief, understanding or agreement that other Persons (including Borrower) will be liable to pay or perform the Guaranteed Obligations,
or that Lender will look to other Persons (including Borrower) to pay or perform the Guaranteed Obligations.

 

Section 2.6       Other
Collateral. The taking or accepting of any other security, collateral or guaranty, or other assurance of payment, for all
or any part of the Guaranteed Obligations.

 

Section 2.7       Release
of Collateral. Any release, surrender, exchange, subordination, deterioration, waste, loss or impairment (including, without
limitation, negligent, willful, unreasonable or unjustifiable impairment) of any collateral, property or security at any time
existing in connection with, or assuring or securing payment of, all or any part of the Guaranteed Obligations.

 

Section 2.8       Care
and Diligence. The failure of Lender or any other party to exercise diligence or reasonable care in the preservation, protection,
enforcement, sale or other handling or treatment of all or any part of any collateral, property or security, including, but not
limited to, any neglect, delay, omission, failure or refusal of Lender (i) to take or prosecute any action for the collection
of any of the Guaranteed Obligations, or (ii) to foreclose, or initiate any action to foreclose, or, once commenced, prosecute
to completion any action to foreclose upon any security therefor, or (iii) to take or prosecute any action in connection with
any instrument or agreement evidencing or securing all or any part of the Guaranteed Obligations.

  

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Section 2.9       Unenforceability.
The fact that any collateral, security, security interest or lien contemplated or intended to be given, created or granted as
security for the repayment of the Guaranteed Obligations, or any part thereof, shall not be properly perfected or created, or
shall prove to be unenforceable or subordinate to any other security interest or lien, it being recognized and agreed by Guarantor
that Guarantor is not entering into this Guaranty in reliance on, or in contemplation of the benefits of, the validity, enforceability,
collectibility or value of any of the collateral for the Guaranteed Obligations.

 

Section 2.10     Representation.
The accuracy or inaccuracy of the representations and warranties made by Guarantor herein or by Borrower in any of the Loan Documents.

 

Section 2.11     Offset.
The Note, the Guaranteed Obligations and the liabilities and obligations of the Guarantor to Lender hereunder shall not be reduced,
discharged or released because of or by reason of any existing or future right of offset, claim or defense of Borrower against
Lender, or any other party, or against payment of the Guaranteed Obligations, whether such right of offset, claim or defense arises
in connection with the Guaranteed Obligations (or the transactions creating the Guaranteed Obligations) or otherwise.

 

Section 2.12     Merger.
The reorganization, merger or consolidation of Borrower or Guarantor into or with any other Person.

 

Section 2.13     Preference.
Any payment by Borrower to Lender is held to constitute a preference under bankruptcy laws or for any reason Lender is required
to refund such payment or pay such amount to Borrower or to any other Person.

 

Section 2.14     Other
Actions Taken or Omitted. Any other action taken or omitted to be taken with respect to the Loan Documents, the Guaranteed
Obligations, or the security and collateral therefor, whether or not such action or omission prejudices Guarantor or increases
the likelihood that Guarantor will be required to pay the Guaranteed Obligations pursuant to the terms hereof, it being the unambiguous
and unequivocal intention of Guarantor that Guarantor shall be obligated to pay the Guaranteed Obligations when due, notwithstanding
any occurrence, circumstance, event, action, or omission whatsoever, whether contemplated or uncontemplated, and whether or not
otherwise or particularly described herein, which obligation shall be deemed satisfied only upon the full and final payment and
satisfaction of the Guaranteed Obligations.

 

ARTICLE
3

REPRESENTATIONS
AND WARRANTIES

 

To induce Lender to
enter into the Loan Documents and to extend credit to Borrower, Guarantor represents and warrants to Lender as follows:

 

Section 3.1       Benefit.
Guarantor is the owner of a direct or indirect interest in Borrower, and has received, or will receive, direct or indirect benefit
from the making of this Guaranty with respect to the Guaranteed Obligations.

 

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Section 3.2       Familiarity
and Reliance. Guarantor is familiar with, and has independently reviewed books and records regarding, the financial condition
of the Borrower and is familiar with the value of any and all collateral intended to be created as security for the payment of
the Note or Guaranteed Obligations; however, Guarantor is not relying on such financial condition or the collateral as an inducement
to enter into this Guaranty.

 

Section 3.3       No
Representation By Lender. Neither Lender nor any other party has made any representation, warranty or statement to Guarantor,
except as expressly set forth herein, in order to induce the Guarantor to execute this Guaranty.

 

Section 3.4       Guarantor’s
Financial Condition. As of the date hereof, and after giving effect to this Guaranty and the contingent obligation evidenced
hereby, Guarantor is and will be solvent and has and will have assets which, fairly valued, exceed its obligations, liabilities
(including probable liability on contingent liabilities) and debts, and has and will have property and assets sufficient to satisfy
and repay its obligations and liabilities, including the Guaranteed Obligations.

 

Section 3.5       Legality.
The execution, delivery and performance by Guarantor of this Guaranty and the consummation of the transactions contemplated hereunder
do not and will not contravene or conflict with any law, statute or regulation whatsoever to which Guarantor is subject or constitute
a default (or an event which with notice or lapse of time or both would constitute a default) under, or result in the breach of,
any indenture, mortgage, charge, lien, or any contract, agreement or other instrument to which Guarantor is a party or which may
be applicable to Guarantor. This Guaranty is a legal and binding obligation of Guarantor and is enforceable in accordance with
its terms, except as limited by bankruptcy, insolvency or other laws of general application relating to the enforcement of creditors’
rights.

 

Section 3.6       Survival.
All representations and warranties made by Guarantor herein shall survive the execution hereof.

 

ARTICLE
4

SUBORDINATION
OF CERTAIN INDEBTEDNESS

 

Section 4.1       Subordination
of All Guarantor Claims. As used herein, the term “Guarantor Claims” shall mean all debts and liabilities
of Borrower to Guarantor, whether such debts and liabilities now exist or are hereafter incurred or arise, and whether the obligations
of Borrower thereon be direct, contingent, primary, secondary, several, joint and several, or otherwise, and irrespective of whether
such debts or liabilities be evidenced by note, contract, open account, or otherwise, and irrespective of the Person or Persons
in whose favor such debts or liabilities may, at their inception, have been, or may hereafter be created, or the manner in which
they have been or may hereafter be acquired by Guarantor. The Guarantor Claims shall include, without limitation, all rights and
claims of Guarantor against Borrower (arising as a result of subrogation or otherwise) as a result of Guarantor’s payment
of all or a portion of the Guaranteed Obligations. So long as any portion of the Obligations or the Guaranteed Obligations remain
outstanding, Guarantor shall not receive or collect, directly or indirectly, from Borrower or any other Person any amount upon
the Guarantor Claims.

 

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Section 4.2       Claims
in Bankruptcy. In the event of any receivership, bankruptcy, reorganization, arrangement, debtor’s relief, or other
insolvency proceeding involving Guarantor as a debtor, Lender shall have the right to prove its claim in any such proceeding so
as to establish its rights hereunder and receive directly from the receiver, trustee or other court custodian dividends and payments
which would otherwise be payable upon Guarantor Claims. Guarantor hereby assigns such dividends and payments to Lender. Should
Lender receive, for application against the Guaranteed Obligations, any dividend or payment which is otherwise payable to Guarantor
and which, as between Borrower and Guarantor, shall constitute a credit against the Guarantor Claims, then, upon payment to Lender
in full of the Guaranteed Obligations, Guarantor shall become subrogated to the rights of Lender to the extent that such payments
to Lender on the Guarantor Claims have contributed toward the liquidation of the Guaranteed Obligations, and such subrogation
shall be with respect to that proportion of the Guaranteed Obligations which would have been unpaid if Lender had not received
dividends or payments upon the Guarantor Claims.

 

Section 4.3       Payments
Held in Trust. Notwithstanding anything to the contrary in this Guaranty, in the event that Guarantor should receive any funds,
payments, claims or distributions which are prohibited by this Guaranty, Guarantor agrees to hold in trust for Lender an amount
equal to the amount of all funds, payments, claims or distributions so received, and agrees that it shall have absolutely no dominion
over the amount of such funds, payments, claims and/or distributions so received except to pay them promptly to Lender, and Guarantor
covenants promptly to pay the same to Lender.

 

Section 4.4       Liens
Subordinate. Guarantor agrees that any liens, security interests, judgment liens, charges or other encumbrances upon Borrower’s
assets securing payment of the Guarantor Claims shall be and remain inferior and subordinate to any liens, security interests,
judgment liens, charges or other encumbrances upon Borrower’s assets securing payment of the Guaranteed Obligations, regardless
of whether such encumbrances in favor of Guarantor or Lender presently exist or are hereafter created or attach. Without the prior
written consent of Lender, Guarantor shall not (i) exercise or enforce any creditor’s rights it may have against Borrower,
or (ii) foreclose, repossess, sequester or otherwise take steps or institute any action or proceedings (judicial or otherwise,
including without limitation the commencement of, or the joinder in, any liquidation, bankruptcy, rearrangement, debtor’s
relief or insolvency proceeding) to enforce any liens, mortgages, deeds of trust, security interests, collateral rights, judgments
or other encumbrances on assets of Borrower held by Guarantor. The foregoing shall in no manner vitiate or amend, nor be deemed
to vitiate or amend, any prohibition in the Loan Documents against Borrower or Guarantor transferring any of its assets to any
Person other than Lender.

 

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ARTICLE
5

COVENANTS

 

Section 5.1       Definitions.
As used in this Article 5, the following terms shall have the respective meanings set forth below:

 

(a)      “Liquid
Assets” shall mean assets in the form of cash, cash equivalents, obligations of (or fully guaranteed as to principal
and interest by) the United States or any agency or instrumentality thereof (provided the full faith and credit of the United
States supports such obligation or guarantee), certificates of deposit issued by a commercial bank having net assets of not less
than $500 million, securities listed and traded on a recognized stock exchange or traded over the counter and listed in the National
Association of Securities Dealers Automatic Quotations, or liquid debt instruments that have a readily ascertainable value and
are regularly traded in a recognized financial market.

 

(b)      “Net
Worth” shall mean, as of a given date, (x) the total assets of Guarantor as of such date less (y) Guarantor’s
total liabilities as of such date, determined in accordance with the accounting principles used in the preparation of Guarantor’s
annual financial statements in accordance with Section 5.2.

 

Section 5.2      Covenants.
Until all of the Obligations and the Guaranteed Obligations have been paid in full, Guarantor shall (i) except for fair value
and except for gifts having a value not material to Guarantor’s ability to perform Guarantor’s obligations hereunder,
not sell, pledge, mortgage or otherwise transfer any of its assets, or any interest therein, (ii) deliver to Lender within ninety
(90) days of each Fiscal Year, Guarantor’s annual financial statements prepared in accordance with tax basis accounting
and otherwise in form and substance reasonably acceptable to Lender, and certified by Guarantor as being correct and complete
and fairly presenting the financial condition of Guarantor, and (iii) deliver to Lender within ninety (90) days of each Fiscal
Year, a certificate of such Guarantor, setting forth in reasonable detail Guarantor’s Net Worth and Liquid Assets.

 

Section 5.3      Prohibited
Transactions. Guarantor shall not, at any time while a default in the payment of the Guaranteed Obligations has occurred and
is continuing, either (i) enter into or effectuate any transaction with any Affiliate which would reduce the Net Worth of Guarantor,
including the payment of any dividend or distribution to a shareholder, or the redemption, retirement, purchase or other acquisition
for consideration of any stock in Guarantor or (ii) except for fair value and except for gifts having a value not material to
Guarantor’s ability to perform Guarantor’s obligations hereunder, sell, pledge, mortgage or otherwise transfer to
any Person any of Guarantor’s assets, or any interest therein.

 

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ARTICLE
6

MISCELLANEOUS

 

Section 6.1       Waiver.
No failure to exercise, and no delay in exercising, on the part of Lender, any right hereunder shall operate as a waiver thereof,
nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right.
The rights of Lender hereunder shall be in addition to all other rights provided by law. No modification or waiver of any provision
of this Guaranty, nor any consent to any departure therefrom, shall be effective unless in writing and no such consent or waiver
shall extend beyond the particular case and purpose involved. No notice or demand given in any case shall constitute a waiver
of the right to take other action in the same, similar or other instances without such notice or demand.

 

Section 6.2      Notices.
All notices, demands, requests, consents, approvals or other communications (any of the foregoing, a “Notice”)
required, permitted or desired to be given hereunder shall be in writing and shall be sent by registered or certified mail, postage
prepaid, return receipt requested, or delivered by hand or by reputable overnight courier, addressed to the party to be so notified
at its address hereinafter set forth, or to such other addresses as such party may hereafter specify in accordance with the provisions
of this Section 6.2. Any Notice shall be deemed to have been received: (a) three (3) days after the date such Notice is
mailed, (b) on the date of delivery by hand if delivered during business hours on a Business Day (otherwise on the next Business
Day), and (c) on the next Business Day if sent by an overnight commercial courier, in each case addressed to the parties as follows:

 

	If to Lender:	Ladder Capital Finance LLC
	 	345 Park Avenue, 8th Floor
	 	New York, New York 10154
	 	Attention:  Pamela McCormack
	 	 
	with a copy to:	Winston & Strawn, LLP
	 	200 Park Avenue
	 	New York, New York 10166
	 	Attention: Corey A. Tessler, Esq.
	 	 
	And with a copy to:	Wells Fargo Bank National Association
	 	Commercial Mortgage Servicing
	 	MAC D1100-090
	 	201 South College Street, 9th Floor
	 	Charlotte, North Carolina 28244-1075 
	 	Fax: 704-715-0473
	 	Attention: Domeica White

 

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	If to Guarantor:	Brett C. Moody
	 	5 Derham Parc
	 	Houston, Texas  77024
	 	 
	With a copy to:	Brett C. Moody
	 	c/o Moody National REIT I, Inc. 
	 	6363 Woodway, Suite 110
	 	Houston, Texas  77057

 

Any party may change the address to which
any such Notice is to be delivered by furnishing ten (10) days’ written notice of such change to the other parties in accordance
with the provisions of this Section 6.2. Notices shall be deemed to have been given on the date set forth above, even if
there is an inability to actually deliver any Notice because of a changed address of which no Notice was given or there is a rejection
or refusal to accept any Notice offered for delivery. Notice for any party may be given by its respective counsel. Additionally,
Notice from Lender may also be given by Servicer.

 

Section 6.3      Governing
Law; Submission to Jurisdiction. (a) THIS GUARANTY WAS NEGOTIATED IN THE STATE OF NEW YORK, AND MADE BY GUARANTOR AND ACCEPTED
BY LENDER IN THE STATE OF NEW YORK, AND THE PROCEEDS OF THE NOTE WERE DISBURSED FROM THE STATE OF NEW YORK, WHICH STATE THE PARTIES
AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE PARTIES AND TO THE UNDERLYING TRANSACTION RELATED HERETO, AND IN ALL RESPECTS, INCLUDING,
WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS GUARANTY AND THE OBLIGATIONS
ARISING HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS
MADE AND PERFORMED IN SUCH STATE (WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS) AND ANY APPLICABLE LAW OF THE UNITED STATES
OF AMERICA. TO THE FULLEST EXTENT PERMITTED BY LAW, GUARANTOR HEREBY UNCONDITIONALLY AND IRREVOCABLY WAIVES ANY CLAIM TO ASSERT
THAT THE LAW OF ANY OTHER JURISDICTION GOVERNS THIS GUARANTY AND/OR THE OTHER LOAN DOCUMENTS, AND THIS GUARANTY AND THE OTHER
LOAN DOCUMENTS SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK PURSUANT TO SECTION 5-1401
OF THE NEW YORK GENERAL OBLIGATIONS LAW.

 

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(b)      ANY
LEGAL SUIT, ACTION OR PROCEEDING AGAINST LENDER OR GUARANTOR ARISING OUT OF OR RELATING TO THIS GUARANTY MAY, AT LENDER’S
OPTION, BE INSTITUTED IN ANY FEDERAL OR STATE COURT IN THE STATE OF NEW YORK, PURSUANT TO SECTION 5-1402 OF THE NEW YORK GENERAL
OBLIGATIONS LAW OR IN ANY STATE OR FEDERAL COURT IN THE STATE OF TEXAS AND GUARANTOR WAIVES ANY OBJECTIONS WHICH IT MAY NOW OR
HEREAFTER HAVE BASED ON VENUE AND/OR FORUM NON CONVENIENS OF ANY SUCH SUIT, ACTION OR PROCEEDING, AND GUARANTOR HEREBY IRREVOCABLY
SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING, GUARANTOR DOES HEREBY AGREE THAT SERVICE OF PROCESS
UPON GUARANTOR AT ITS NOTICE ADDRESS AS SET FORTH IN SECTION 6.2 HEREOF (OR SUCH OTHER NEW NOTICE ADDRESS ESTABLISHED BY GUARANTOR
PURSUANT TO SECTION 6.2 HEREOF) BY REGISTERED MAIL, RETURN RECEIPT REQUESTED, SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE
OF PROCESS UPON GUARANTOR IN ANY SUCH SUIT, ACTION OR PROCEEDING AT THE TIME RECEIVED OR REFUSED BY GUARANTOR. NOTHING CONTAINED
HEREIN SHALL AFFECT THE RIGHT OF LENDER TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS
OR OTHERWISE PROCEED AGAINST GUARANTOR IN ANY OTHER JURISDICTIONS.

 

Section 6.4       Invalid
Provisions. If any provision of this Guaranty is held to be illegal, invalid, or unenforceable under present or future laws
effective during the term of this Guaranty, such provision shall be fully severable and this Guaranty shall be construed and enforced
as if such illegal, invalid or unenforceable provision had never comprised a part of this Guaranty, and the remaining provisions
of this Guaranty shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision
or by its severance from this Guaranty, unless such continued effectiveness of this Guaranty, as modified, would be contrary to
the basic understandings and intentions of the parties as expressed herein.

 

Section 6.5       Amendments.
This Guaranty may be amended only by an instrument in writing executed by the party against whom such amendment is sought to be
enforced.

 

Section 6.6       Parties
Bound; Assignment; Joint and Several. This Guaranty shall be binding upon and shall inure to the benefit of the parties hereto
and their respective successors, permitted assigns, heirs and legal representatives. Lender may sell, assign, pledge, participate,
transfer or delegate, as applicable to one or more Persons all or a portion of its rights and obligations under this Guaranty
in connection with any assignment, sale, pledge, participation or transfer of the Loan and the Loan Documents. Any assignee or
transferee of Lender shall be entitled to all the benefits afforded to Lender under this Guaranty. Guarantor shall not have the
right to delegate, assign or transfer its rights or obligations under this Assignment without the prior written consent of Lender,
and any attempted assignment, delegation or transfer without such consent shall be null and void. If Guarantor consists of more
than one Person or party, the obligations of each such Person or party shall be joint and several.

 

Section 6.7      Headings.
Section headings are for convenience of reference only and shall in no way affect the interpretation of this Guaranty.

 

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Section 6.8      Recitals.
The recitals and introductory paragraphs hereof are a part hereof, form a basis for this Guaranty and shall be considered prima
facie evidence of the facts and documents referred to therein.

 

Section 6.9      Counterparts.
To facilitate execution, this Guaranty may be executed in as many counterparts as may be convenient or required. It shall not
be necessary that the signature of, or on behalf of, each party, or that the signature of all persons required to bind any party,
appear on each counterpart. All counterparts shall collectively constitute a single instrument. It shall not be necessary in making
proof of this Guaranty to produce or account for more than a single counterpart containing the respective signatures of, or on
behalf of, each of the parties hereto. Any signature page to any counterpart may be detached from such counterpart without impairing
the legal effect of the signatures thereon and thereafter attached to another counterpart identical thereto except having attached
to it additional signature pages.

 

Section 6.10     Rights
and Remedies. If Guarantor becomes liable for any indebtedness owing by Borrower to Lender, by endorsement or otherwise, other
than under this Guaranty, such liability shall not be in any manner impaired or affected hereby and the rights of Lender hereunder
shall be cumulative of any and all other rights that Lender may ever have against Guarantor. The exercise by Lender of any right
or remedy hereunder or under any other instrument, or at law or in equity, shall not preclude the concurrent or subsequent exercise
of any other right or remedy.

 

Section 6.11     Entirety.
THIS GUARANTY EMBODIES THE FINAL, ENTIRE AGREEMENT OF GUARANTOR AND LENDER WITH RESPECT TO GUARANTOR’S GUARANTY OF THE GUARANTEED
OBLIGATIONS AND SUPERSEDES ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS, AND UNDERSTANDINGS, WHETHER WRITTEN OR
ORAL, RELATING TO THE SUBJECT MATTER HEREOF. THIS GUARANTY IS INTENDED BY GUARANTOR AND LENDER AS A FINAL AND COMPLETE EXPRESSION
OF THE TERMS OF THE GUARANTY, AND NO COURSE OF DEALING BETWEEN GUARANTOR AND LENDER, NO COURSE OF PERFORMANCE, NO TRADE PRACTICES,
AND NO EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS OR OTHER EXTRINSIC EVIDENCE OF ANY NATURE
SHALL BE USED TO CONTRADICT, VARY, SUPPLEMENT OR MODIFY ANY TERM OF THIS GUARANTY. THERE ARE NO ORAL AGREEMENTS BETWEEN GUARANTOR
AND LENDER.

 

Section 6.12     Waiver
of Right To Trial By Jury. LENDER AND GUARANTOR HEREBY AGREE NOT TO ELECT A TRIAL BY JURY OF ANY ISSUE TRIABLE OF RIGHT BY
JURY, AND WAIVES ANY RIGHT TO TRIAL BY JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR HEREAFTER EXIST WITH REGARD TO
THIS GUARANTY, THE NOTE, THE MORTGAGE, THE LOAN AGREEMENT, OR THE OTHER LOAN DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM OR OTHER ACTION
ARISING IN CONNECTION THEREWITH. THIS WAIVER OF RIGHT TO TRIAL BY JURY IS GIVEN KNOWINGLY AND VOLUNTARILY, AND IS INTENDED TO
ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY JURY WOULD OTHERWISE ACCRUE. EACH PARTY
IS HEREBY AUTHORIZED TO FILE A COPY OF THIS PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER.

 

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Section 6.13    Cooperation.
Guarantor acknowledges that Lender and its successors and assigns may (i) sell this Guaranty, the Note and the other Loan Documents
to one or more investors as a whole loan, (ii) participate the Loan secured by this Guaranty to one or more investors, (iii) deposit
this Guaranty, the Note and the other Loan Documents with a trust, which trust may sell certificates to investors evidencing an
ownership interest in the trust assets, or (iv) otherwise sell the Loan or one or more interests therein to investors (the transactions
referred to in clauses (i) through (iv) are hereinafter each referred to as “Secondary Market Transaction”).
Guarantor shall cooperate with Lender (provided that any out of pocket expenses actually incurred by Guarantor in connection therewith
shall be paid by Lender) in effecting any such Secondary Market Transaction and shall cooperate to implement all requirements
imposed by any Rating Agencies involved in any Secondary Market Transaction. Guarantor shall use commercially reasonable efforts
to provide, or cause Borrower to provide, such information and documents relating to Guarantor, Borrower, the Property and any
tenants of the Property as Lender may reasonably request in connection with such Secondary Market Transaction. In addition, Guarantor
shall make available to Lender all information concerning its business and operations that Lender may reasonably request. Lender
shall be permitted to share all such information with the investment banking firms, Rating Agencies, accounting firms, law firms
and other third-party advisory firms involved with the Loan and the Loan Documents or the applicable Secondary Market Transaction.
It is understood that the information provided by Guarantor to Lender including any and all financial statements provided to Lender
pursuant to Section 5.2 hereof may ultimately be incorporated into the offering documents for the Secondary Market Transaction
and thus various investors or potential investors may also see some or all of the information. Lender and all of the aforesaid
third-party advisors and professional firms shall be entitled to rely on the information supplied by, or on behalf of, Guarantor
in the form as provided by Guarantor. Lender may publicize the existence of the Loan in connection with its marketing for a Secondary
Market Transaction or otherwise as part of its business development.

 

Section 6.14     Reinstatement
in Certain Circumstances. If at any time any payment of the principal of or interest under the Note or any other amount payable
by the Borrower under the Loan Documents is rescinded or must be otherwise restored or returned upon the insolvency, bankruptcy
or reorganization of the Borrower or otherwise, the Guarantor’s obligations hereunder with respect to such payment shall
be reinstated as though such payment had been due but not made at such time.

 

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Section 6.15     Gender;
Number; General Definitions. Unless the context clearly indicates a contrary intent or unless otherwise specifically provided
herein, (a) words used in this Guaranty may be used interchangeably in the singular or plural form, (b) any pronouns used herein
shall include the corresponding masculine, feminine or neuter forms, (c) the word “Borrower” shall mean “each
Borrower and any subsequent owner or owners of a fee interest in the Property or any part thereof”, (d) the word “Lender”
shall mean “Lender and any subsequent holder of the Note”, (e) the word “Note” shall mean “the Note
and any other evidence of indebtedness secured by the Loan Agreement, as amended, restated or otherwise modified”, (f) the
word “Property” shall include any portion of the Property and any interest therein, and (g) the phrases “attorneys’
fees”, “legal fees” and “counsel fees” shall include any and all attorneys’, paralegal and
law clerk fees and disbursements, including, but not limited to, fees and disbursements at the pre-trial, trial and appellate
levels, incurred or paid by Lender in protecting its interest in the Property, the Leases and/or the Rents and/or in enforcing
its rights hereunder.

 

[NO
FURTHER TEXT ON THIS PAGE]

 

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IN WITNESS WHEREOF,
Guarantor has executed this Guaranty of Recourse Obligations as of the day and year first above written.

 

	 	 	/s/ Brett C. Moody
	 	 	BRETT C. MOODY, a natural person

 

[Signature Page
to Guaranty – Grapevine Residence Inn]Moody National Advisor I, LLC. 10-Q

 

EXHIBIT 10.8

 

ENVIRONMENTAL
INDEMNITY AGREEMENT

 

ENVIRONMENTAL INDEMNITY
AGREEMENT (as amended, restated, supplemented or otherwise modified from time to time, this “Agreement”) made
as of March 31, 2014 by MOODY NATIONAL 2020-GRAPEVINE HOLDING, LLC, a Delaware limited liability company, having its principal
place of business at c/o Moody National REIT I, Inc., 6363 Woodway, Suite 110, Houston, Texas 77057, (together with its permitted
successors and assigns, collectively, “Borrower”), BRETT C. MOODY, a natural person, having an address
at 5 Derham Parc, Houston, TX 77024 (the “Principal”; Principal together with Borrower and each of their permitted
successors and assigns, collectively, “Indemnitor”), in favor of LADDER CAPITAL FINANCE LLC, a Delaware
limited liability company, having an address at 345 Park Avenue, 8th Floor, New York, New York 10154 (together with
its successors and assigns, collectively, “Indemnitee”) and other Indemnified Parties (defined below).

 

RECITALS:

 

A.     Indemnitee
is prepared to make a loan (the “Loan”) to Borrower in the principal amount of $13,250,000.00 pursuant to a
Loan Agreement of even date herewith between Borrower and Indemnitee (as the same may be amended, restated, replaced, supplemented
or otherwise modified from time to time, the “Loan Agreement”), which Loan shall be evidenced by that certain
Promissory Note of even date herewith given by Borrower in favor of Indemnitee (as amended, restated, replaced, supplemented or
otherwise modified from time to time, the “Note”) and secured by among other things, that certain Deed of Trust,
Assignment of Leases and Rents, Security Agreement and Fixture Filing of even date herewith, given by Borrower in favor of Indemnitee
(as the same may be amended, restated, replaced, supplemented or otherwise modified from time to time, the “Mortgage”)
encumbering the real property more particularly described therein (said real property being referred to as the “Land”;
the Land, together with all structures, buildings and improvements now or hereafter located on the Land, being herein collectively
referred to as the “Property”).

 

B.     Principal
acknowledges that it has a direct or indirect ownership interest in Borrower and will receive substantial economic and other benefits
from Indemnitee’s making the Loan to Borrower.

 

C.     Indemnitee
is unwilling to make the Loan unless Indemnitor agrees to provide the indemnification, representations, warranties, covenants
and other matters described in this Agreement for the benefit of the Indemnified Parties.

 

D.     Indemnitor
is entering into this Agreement to induce Indemnitee to make the Loan.

 

E.     Capitalized
terms used but not otherwise defined herein shall have the meaning ascribed to such terms in the Loan Agreement.

 

    	 

    	 

    

 

AGREEMENT

 

NOW THEREFORE, in
consideration of the premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,
Indemnitor hereby represents, warrants, covenants and agrees for the benefit of the Indemnified Parties as follows:

 

1.      Environmental
Representations and Warranties. Except as otherwise disclosed by those reports listed on Schedule I attached hereto
and made a part hereof in respect of the Property delivered to Indemnitee (referred to below as the “Environmental Report(s)”),
a copy of which has been provided to Indemnitee, to Indemnitor’s actual knowledge, (a) there are no Hazardous Substances
(defined below) or underground storage tanks in, on, or under the Property, except those that are both (i) in compliance with
all Environmental Laws (defined below) and with permits issued pursuant thereto and (ii) fully disclosed to Indemnitee in writing
pursuant to the Environmental Report(s); (b) there are no past, present or threatened Releases (defined below) of Hazardous Substances
in, on, under or from the Property which have not been fully remediated in accordance with Environmental Law; (c) there is no
threat of any Release of Hazardous Substances migrating to the Property; (d) there is no past or present non-compliance with Environmental
Laws, or with permits issued pursuant thereto, in connection with the Property which has not been fully remediated in accordance
with Environmental Laws; (e) Indemnitor does not know of, and has not received, any written or oral notice or other communication
from any Person (including, but not limited to a Governmental Authority) relating to Hazardous Substances or Remediation (defined
below) thereof, of possible liability of any Person pursuant to any Environmental Law, other environmental conditions in connection
with the Property, or any actual or potential administrative or judicial proceedings in connection with any of the foregoing;
(f) no Mold (as defined below) is present in the indoor air of the Property at concentrations exceeding ambient air levels and
no visible Mold is present on any building materials or surfaces at the Property for which any Governmental Authority recommends
or requires removal thereof by remediation professionals, and Indemnitors are not aware of any conditions at the Property that
are likely to result in the presence of Mold in the indoor air at concentrations that exceed ambient air levels or on building
materials or surfaces that would require such removal; and (g) Indemnitor has truthfully and fully provided to Indemnitee, in
writing, any and all information relating to conditions in, on, under or from the Property that is known to Indemnitor and that
is contained in files and records of Indemnitor, including but not limited to any reports relating to Hazardous Substances in,
on, under or from the Property and/or to the environmental condition of the Property. As used in this Agreement, the term “Mold”
means fungi that reproduces through the release of spores or the splitting of cells or other means, including, but not limited
to, mold, mildew, fungi, fungal spores, fragments and metabolites such as mycotoxins and microbial organic compounds.

 

    	2

    	 

    

 

2.      Environmental
Covenants. Indemnitor covenants and agrees that: (a) all uses and operations on or of the Property, whether by Indemnitor
or any other Person, shall be in compliance with all Environmental Laws and permits issued pursuant thereto; (b) there shall be
no Releases of Hazardous Substances in, on, under or from the Property; (c) there shall be no Hazardous Substances in, on, or
under the Property, except those that are both (i) in compliance with all Environmental Laws and with permits issued pursuant
thereto and (ii) fully disclosed to Indemnitee in writing; (d) Indemnitor shall keep the Property free and clear of all liens
and other encumbrances imposed pursuant to any Environmental Law, whether due to any act or omission of Indemnitor or any other
Person (the “Environmental Liens”); (e) Indemnitor shall, at its sole cost and expense, fully and expeditiously
cooperate in all activities pursuant to Paragraph 3 of this Agreement, including but not limited to providing all relevant
information and making knowledgeable Persons available for interviews; (f) Indemnitor shall, at its sole cost and expense, perform
any environmental site assessment or other investigation of environmental conditions in connection with the Property, by an environmental
consultant approved by Indemnitee pursuant to any reasonable written request of Indemnitee (including but not limited to sampling,
testing and analysis of soil, water, air, building materials, and other materials and substances whether solid, liquid or gas),
and share with Indemnitee the reports and other results thereof, and Indemnitee and the other Indemnified Parties shall be entitled
to rely on such reports and other results thereof; (g) Indemnitor shall, at its sole cost and expense, comply with all reasonable
written requests of Indemnitee to (i) effectuate Remediation or obtain a no further action letter for any condition (including
but not limited to a Release of any Hazardous Substances) in, on, under or from the Property in full compliance with Environmental
Laws or reasonably required by Indemnitee based upon recommendations and observations of an independent environmental consultant
approved by Indemnitee; (ii) comply with any Environmental Law; (iii) comply with any directive from any Governmental Authority;
and (iv) take any other reasonable action necessary or appropriate for protection of human health or the environment; (h) Indemnitor
shall not do or allow any tenant or other user of the Property to do any act that materially increases the dangers to human health
or the environment, poses an unreasonable risk of harm to any Person (whether on or off the Property), impairs or may impair the
value of the Property, is contrary to any requirement of any insurer, constitutes a public or private nuisance, constitutes waste,
or violates any covenant, condition, agreement or easement applicable to the Property; (i) Indemnitor shall use commercially reasonable
efforts to enforce the applicable provisions of the Leases in order to prevent tenants or other users of the Property from taking
any action that violates any applicable Environmental Law, impairs or may impair the value of the Property, as contrary to any
requirement of any Issuer, constitutes a public or private nuisance, constitutes waste or violates any covenant, condition, agreement
or easement applicable to the Property; and (j) Indemnitor shall immediately notify Indemnitee in writing after becoming aware
of (A) any presence or Release or threatened Release of Hazardous Substances in, on, under, from or migrating towards the Property;
(B) any non-compliance with any Environmental Laws related in any way to the Property; (C) any actual or potential imposition
of an Environmental Lien; (D) any required or proposed Remediation of environmental conditions relating to the Property; and/or
(E) any written notice or other written communication of which any Indemnitor becomes aware from any source whatsoever (including
but not limited to a Governmental Authority) relating in any way to Hazardous Substances or Remediation thereof, possible liability
of any Person pursuant to any Environmental Law, other environmental conditions in connection with the Property, or any actual
or potential administrative or judicial proceedings in connection with anything referred to in this Agreement.

 

    	3

    	 

    

 

3.      Indemnified
Rights/Cooperation and Access. In the event the Indemnified Parties have reason to believe that an environmental hazard exists
on the Property that does not, in the sole discretion of the Indemnified Parties, endanger any tenants or other occupants of the
Property or their guests or the general public or materially and adversely affects the value of the Property, upon reasonable
notice from the Indemnitee, Indemnitor shall, at Indemnitor’s sole cost and expense, promptly cause an engineer or consultant
satisfactory to the Indemnified Parties to conduct any environmental assessment or audit (the scope of which shall be determined
in the sole and absolute discretion of the Indemnified Parties) and take any samples of soil, groundwater or other water, air,
or building materials or any other invasive testing requested by Indemnitee and promptly deliver to Indemnitee the results of
any such assessment, audit, sampling or other testing; provided, however, if such results are not delivered to the
Indemnitee within a reasonable period or if the Indemnified Parties have reason to believe that an environmental hazard exists
on the Property that, in the sole judgment of the Indemnified Parties, endangers any Tenant or other occupant of the Property
or their guests or the general public or may materially and adversely affect the value of the Property, upon reasonable notice
to Indemnitor, the Indemnified Parties and any other Person designated by the Indemnified Parties, including but not limited to
any receiver, any representative of a Governmental Authority, and any environmental consultant, shall have the right, but not
the obligation, to enter upon the Property at all reasonable times to assess any and all aspects of the environmental condition
of the Property and its use, including but not limited to conducting any environmental assessment or audit (the scope of which
shall be determined in the sole and absolute discretion of the Indemnified Parties) and taking samples of soil, groundwater or
other water, air, or building materials, and reasonably conducting other invasive testing. Indemnitor shall cooperate with and
provide the Indemnified Parties and any such Person designated by the Indemnified Parties with access to the Property.

 

    	4

    	 

    

 

4.      Indemnification.
Indemnitor covenants and agrees, at its sole cost and expense, to protect, defend, indemnify, release and hold Indemnified Parties
harmless from and against any and all Losses (defined below) imposed upon or incurred by or asserted against any Indemnified Parties
and directly or indirectly arising out of or in any way attributable to any one or more of the following: (a) any presence of
any Hazardous Substances in, on, above, or under the Property; (b) any past, present or threatened Release of Hazardous Substances
in, on, above, under or from the Property; (c) any activity by Indemnitor, any Person affiliated with Indemnitor, and/or any Tenant
or other occupant or user of the Property in connection with any actual, proposed or threatened use, treatment, storage, holding,
existence, disposition or other Release, generation, production, manufacturing, processing, refining, control, management, abatement,
removal, handling, transfer or transportation to or from the Property of any Hazardous Substances at any time located in, under,
on or above the Property; (d) any activity by Indemnitor, any Person affiliated with Indemnitor, and/or any Tenant or occupant
or other user of the Property in connection with any actual or proposed Remediation of any Hazardous Substances at any time located
in, under, on or above the Property, whether or not such Remediation is voluntary or pursuant to court or administrative order,
including but not limited to any removal, remedial or corrective action; (e) any past, present or threatened non-compliance or
violations of any Environmental Laws (or permits issued pursuant to any Environmental Law) in connection with the Property or
operations thereon, including, but not limited to, any failure by Indemnitor, any Person affiliated with Indemnitor, and/or any
Tenant or occupant or other user of the Property to comply with any order of any Governmental Authority in connection with any
Environmental Laws; (f) the imposition, recording or filing or the threatened imposition, recording or filing of any Environmental
Lien encumbering the Property; (g) any administrative processes or proceedings or judicial proceedings in any way connected with
any matter addressed in this Agreement; (h) any past, present or threatened injury to, destruction of or loss of natural resources
in any way connected with the Property, including but not limited to costs to investigate and assess such injury, destruction
or loss; (i) any acts of Indemnitor, any Person affiliated with Indemnitor, and/or any Tenant or occupant or other user of the
Property in arranging for disposal or treatment, or arranging with a transporter for transport for disposal or treatment, of Hazardous
Substances at any facility or incineration vessel containing such or similar Hazardous Substances; (j) any acts of Indemnitor,
any Person affiliated with any Indemnitor, and/or any Tenant or occupant or other user of the Property in accepting any Hazardous
Substances for transport to disposal or treatment facilities, incineration vessels or sites from which there is a Release, or
a threatened Release of any Hazardous Substance which causes the incurrence of costs for Remediation; (k) in each case, to the
extent caused by Hazardous Substances or violation of any Environmental Law, any personal injury, wrongful death, or property
or other damage arising under any statutory or common law or tort law theory, including but not limited to damages assessed for
private or public nuisance or for the conducting of an abnormally dangerous activity on or near the Property; and (l) in each
case, to the extent relating to Hazardous Substances or Environmental Laws, any misrepresentation or inaccuracy in any representation
or warranty or material breach or failure to perform any covenants or other obligations pursuant to this Agreement, the Loan Agreement
or the other Loan Documents.

 

5.      Duty
to Defend and Attorneys and Other Fees and Expenses. Upon written request by any Indemnified Party, Indemnitor shall defend
such Indemnified Party (if requested by any Indemnified Party, in the name of the Indemnified Party) by attorneys and other professionals
approved by the Indemnified Parties. Notwithstanding the foregoing, any Indemnified Parties may, in their sole and absolute discretion,
engage their own attorneys and other professionals to defend or assist them, and, at the option of Indemnified Parties, their
attorneys shall control the resolution of any claim or proceeding, providing that no compromise or settlement shall be entered
without Indemnitor’s consent, which consent shall not be unreasonably withheld. Upon demand, Indemnitor shall pay or, in
the sole and absolute discretion of the Indemnified Parties, reimburse, the Indemnified Parties for the payment of reasonable
fees and disbursements of attorneys, engineers, environmental consultants, laboratories and other professionals in connection
therewith.

 

    	5

    	 

    

 

6.      Definitions.
As used in this Agreement, the following terms shall have the following meanings: The term “Environmental Law”
means any present and future federal, state and local laws, statutes, ordinances, rules, regulations and the like, as well as
common law, relating to protection of human health or the environment in each case relating to exposure to or the presence of
Hazardous Substances, relating to Hazardous Substances and/or relating to liability for or costs of other actual or threatened
danger to human health or the environment relating to exposure to or the presence of Hazardous Substances. The term “Environmental
Law” includes, but is not limited to, the following statutes, as amended, any successor thereto, and any regulations
promulgated pursuant thereto, and any state or local statutes, ordinances, rules, regulations and the like addressing similar
issues governing the use, ownership or operation of the Property: the Comprehensive Environmental Response, Compensation and Liability
Act; the Emergency Planning and Community Right-to-Know Act; the Hazardous Substances Transportation Act; the Resource Conservation
and Recovery Act (including but not limited to Subtitle I relating to underground storage tanks); the Solid Waste Disposal Act;
the Clean Water Act; the Clean Air Act; the Toxic Substances Control Act; the Safe Drinking Water Act; the Occupational Safety
and Health Act; the Federal Water Pollution Control Act; the Federal Insecticide, Fungicide and Rodenticide Act; the Endangered
Species Act; the National Environmental Policy Act; the Oil Pollution Act of 1990; the River and Harbors Appropriation Act the
Texas Water Code §26.001 et seq.; the Texas Health & Safety Code §361.001 et seq.; and the Texas Solid Waste Disposal
Act, Tex. Civ. Stat. Ann. art. 4477-7. The term “Environmental Law” also includes, but is not limited to, any
present and future federal, state and local laws, statutes, ordinances, rules, regulations, permits or authorizations and the
like, as well as common law that: (a) condition transfer of property upon a negative declaration or other approval of a Governmental
Authority of the environmental condition of the Property; (b) requires notification or disclosure of Releases of Hazardous Substances
or other environmental condition of the Property to any Governmental Authority or other Person, whether or not in connection with
transfer of title to or interest in property; (c) impose conditions or requirements in connection with permits or other authorization
for lawful activity, in each case relating to exposure to or the presence of Hazardous Substances; (d) relate to nuisance, trespass
or other causes of action related to the Property, in each case relating to exposure to or the presence of Hazardous Substances;
or (e) relate to wrongful death, personal injury, or property or other damage in connection with any physical condition or use
of the Property, in each case relating to exposure to or the presence of Hazardous Substances.

 

The term “Hazardous
Substances” includes but is not limited to any and all substances (whether solid, liquid or gas) defined, listed, or
otherwise classified as pollutants, hazardous wastes, hazardous substances, hazardous materials, extremely hazardous wastes, or
words of similar meaning or regulatory effect under any present or future Environmental Laws or that may have a negative impact
on human health or the environment, including but not limited to petroleum and petroleum products, asbestos and asbestos-containing
materials, polychlorinated biphenyls, lead, radon, mold, radioactive materials, flammables and explosives, but excluding substances
of kinds and in amounts ordinarily and customarily used or stored in properties similar to the Property for the purposes of cleaning
or other maintenance or operations, or for sale, and otherwise in compliance with all Environmental Laws.

 

The term “Indemnified
Parties” includes Indemnitee, any Person who is or will have been involved in the origination of the Loan, any Person
who is or will have been involved with the servicing of the Loan, any Person in whose name the encumbrance created by the Mortgage
is or will have been recorded, Persons who may hold or acquire or will have held a full or partial interest in the Loan (including,
but not limited to, Investors (defined below) or prospective Investors in the Securities (defined below), as well as custodians,
trustees and other fiduciaries who hold or have held a full or partial interest in the Loan for the benefit of third parties)
as well as the respective directors, officers, shareholders, partners, members, employees, agents, servants, representatives,
contractors, subcontractors, affiliates, subsidiaries, participants, successors and assigns of any and all of the foregoing (including
but not limited to any other Person who holds or acquires or will have held a participation or other full or partial interest
in the Loan or the Property, whether during the term of the Loan or as a part of, or following a foreclosure of, the Loan and
including, but not limited to, any successors by merger, consolidation or acquisition of all or a substantial portion of Indemnitee’s
assets and business).

 

    	6

    	 

    

 

The term “Legal
Action” means any claim, suit or proceeding, whether administrative or judicial in nature.

 

The term “Losses”
includes any losses, damages, costs, fees, expenses, claims, suits, judgments, awards, liabilities (including, but not limited,
to strict liabilities), obligations, debts, diminutions in value (but only to the extent of any deficiency in respect of the Debt),
fines, penalties, charges, costs of Remediation (whether or not performed voluntarily), amounts paid in settlement, foreseeable
and unforeseeable consequential damages, litigation costs, attorneys’ fees, engineers’ fees, environmental consultants’
fees, and investigation costs (including, but not limited to, costs for sampling, testing and analysis of soil, water, air, building
materials, and other materials and substances whether solid, liquid or gas), of whatever kind or nature, and whether or not incurred
in connection with any judicial or administrative proceedings, actions, claims, suits, judgments or awards.

 

The term “Release”
with respect to any Hazardous Substance includes, but is not limited to, any release, deposit, discharge, emission, leaking, leaching,
spilling, seeping, migrating, injecting, pumping, pouring, emptying, escaping, dumping, disposing or other movement of Hazardous
Substances.

 

The term “Remediation”
includes, but is not limited to, any response, remedial, removal, or corrective action; any activity to clean up, detoxify, decontaminate,
contain or otherwise remediate any Hazardous Substance; any actions to prevent, cure or mitigate any Release of any Hazardous
Substance; any action to comply with any Environmental Laws or with any permits issued pursuant thereto; any inspection, investigation,
study, monitoring, assessment, audit, sampling and testing, laboratory or other analysis, or evaluation relating to any Hazardous
Substances or to anything referred to herein.

 

7.     Unimpaired
Liability. The liability of Indemnitor under this Agreement shall in no way be limited or impaired by, and Indemnitor hereby
consents to and agrees to be bound by, any amendment or modification of the provisions of the Note, the Loan Agreement, the Mortgage
or any other Loan Document to or with Indemnitee by Borrower, Guarantor or any Person who succeeds Borrower or any Person as owner
of the Property. In addition, the liability of Indemnitor under this Agreement shall in no way be limited or impaired by (i) any
extensions of time for performance required by the Note, the Loan Agreement, the Mortgage or any of the other Loan Documents,
(ii) any sale or transfer of all or part of the Property, (iii) except as provided herein, any exculpatory provision in the Note,
the Loan Agreement, the Mortgage, or any of the other Loan Documents limiting Indemnitee’s recourse to the Property or to
any other security for the Note, or limiting Indemnitee’s rights to a deficiency judgment against Indemnitor, (iv) the accuracy
or inaccuracy of the representations and warranties made by Indemnitor herein and by Borrower and/or Guarantor under the Note,
the Loan Agreement, the Mortgage or any of the other Loan Documents or herein, (v) the release of Indemnitor or any other Person
from performance or observance of any of the agreements, covenants, terms or condition contained in any of the other Loan Documents
by operation of law, Indemnitee’s voluntary act, or otherwise, (vi) the release or substitution in whole or in part of any
security for the Note, or (vii) Indemnitee’s failure to record the Mortgage or file any UCC financing statements (or Indemnitee’s
improper recording or filing of any thereof) or to otherwise perfect, protect, secure or insure any security interest or lien
given as security for the Note; and, in any such case, whether with or without notice to Indemnitor and with or without consideration.

 

    	7

    	 

    

 

8.      Enforcement.
Indemnified Parties may enforce the obligations of Indemnitor without first resorting to or exhausting any security or collateral
or without first having recourse pursuant to the Note, the Loan Agreement, the Mortgage, or any other Loan Documents or any of
the Property, through foreclosure proceedings or otherwise, provided, however, that nothing herein shall inhibit
or prevent Indemnitee from suing on the Note, foreclosing, or exercising any power of sale under, the Mortgage, or exercising
any other rights and remedies thereunder. The Obligations of Borrower under this Agreement shall not be secured by the Mortgage,
unless Indemnitee expressly elects in writing to make them so secured. It is not necessary for an Event of Default to have occurred
pursuant to and as defined in the Mortgage or the Loan Agreement for Indemnified Parties to exercise their rights pursuant to
this Agreement. Notwithstanding any provision of the Loan Agreement (including, without limitation, Section 11.22 thereof), the
obligations pursuant to this Agreement are exceptions to any non-recourse or exculpation provision of the Loan Agreement; Indemnitor
expressly acknowledges and agrees that it is fully and personally liable for such obligations, and such liability is not limited
to the original or amortized principal balance of the Loan or the value of the Property.

 

9.      Survival.
The obligations and liabilities of Indemnitor under this Agreement shall fully survive indefinitely notwithstanding any termination,
satisfaction, assignment, entry of a judgment of foreclosure, exercise of any power of sale, or delivery of a deed in lieu of
foreclosure of the Mortgage. Notwithstanding anything to the contrary that may be contained in this Agreement providing that Indemnitors’
obligations hereunder shall not be affected by a sale or transfer of any of the Property, upon a transfer of the Property, Indemnitors
shall be released from their obligations hereunder with respect to the Property transferred, arising from and after the date of
such sale or transfer, on the condition that such release shall only be in respect of Indemnitor’s or Principal’s
obligations arising hereunder which occur after the applicable transferee’s acquisition of title to the Property but only
to the extent that such obligations arise independently of any condition existing prior to the date of such transfer and Indemnitors’
obligations hereunder shall remain as to any pre-existing condition whether or not such condition (x) is aggravated by any contributory
cause by the transferee, or (y) is discovered after the date of such transfer.

 

10.    Interest.
Any amounts payable to any Indemnified Parties under this Agreement shall become immediately due and payable on demand and, if
not paid within five (5) days of such demand therefor, shall bear interest at the Default Rate.

 

    	8

    	 

    

 

11.    Waivers.
(a) Indemnitor hereby waives and relinquishes (i) any right or claim of right to cause a marshaling of Indemnitor’s assets
or to cause Indemnitee or other Indemnified Parties to proceed against any of the security for the Loan before proceeding under
this Agreement against Indemnitor; (ii) all rights and remedies accorded by Legal Requirements to indemnitors or guarantors, except
any rights of subrogation which Indemnitor may have, provided that the indemnity provided for hereunder shall neither be
contingent upon the existence of any such rights of subrogation nor subject to any claims or defenses whatsoever which may be
asserted in connection with the enforcement or attempted enforcement of such subrogation rights, including, without limitation,
any claim that such subrogation rights were abrogated by any acts of Indemnitee or other Indemnified Parties; (iii) the right
to assert a counterclaim, other than a mandatory or compulsory counterclaim, in any action or proceeding brought against or by
Indemnitee or other Indemnified Parties; (iv) notice of acceptance hereof and of any action taken or omitted in reliance hereon;
(v) presentment for payment, demand of payment, protest or notice of nonpayment or failure to perform or observe, or other proof,
or notice or demand; and (vi) all homestead exemption rights against the obligations hereunder and the benefits of any statutes
of limitations or repose. Notwithstanding anything to the contrary contained herein, Indemnitor hereby agrees to postpone the
exercise of any rights of subrogation with respect to any collateral securing the Loan until the Loan shall have been paid in
full.

 

(b)     INDEMNITOR
AND INDEMNITEE HEREBY AGREE NOT TO ELECT A TRIAL BY JURY OF ANY ISSUE TRIABLE OF RIGHT BY JURY, AND FOREVER WAIVE ANY RIGHT TO
TRIAL BY JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR HEREAFTER EXIST, WITH REGARD TO THIS AGREEMENT, THE NOTE, THE
MORTGAGE OR THE OTHER LOAN DOCUMENTS, OR ANY CLAIM, COUNTERCLAIM OR OTHER ACTION ARISING IN CONNECTION THEREWITH. THIS WAIVER
OF RIGHT TO TRIAL BY JURY IS GIVEN KNOWINGLY AND VOLUNTARILY AND IS INTENDED TO ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH
ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY JURY WOULD OTHERWISE ACCRUE. THE PARTIES ARE HEREBY AUTHORIZED TO FILE A COPY OF THIS
PARAGRAPH IN ANY PROCEEDING AS CONCLUSIVE EVIDENCE OF THIS WAIVER.

 

12.     Subrogation.
Indemnitor hereby agrees to take any and all reasonable actions, including institution of legal action against third parties,
necessary or appropriate to obtain reimbursement, payment or compensation from such Persons responsible for the presence of any
Hazardous Substances at, in, on, under or near the Property or otherwise obligated by law to bear the cost. The Indemnified Parties
shall be and hereby are subrogated to all of Indemnitor’s rights now or hereafter in such claims.

 

13.     Indemnitor’s
Representations and Warranties. Each Indemnitor represents and warrants that:

 

(a)     it
has the full power and authority to execute and deliver this Agreement and to perform its obligations hereunder; the execution,
delivery and performance of this Agreement by Indemnitor has been duly and validly authorized; and all requisite action has been
taken by Indemnitor to make this Agreement valid and binding upon Indemnitor, enforceable in accordance with its terms;

 

    	9

    	 

    

 

(b)     its
execution of, and compliance with, this Agreement is in the ordinary course of business of Indemnitor and will not result in the
breach of any term or provision of the charter, by-laws, partnership, operating or trust agreement, or other governing instrument
of Indemnitor or result in the breach of any term or provision of, or conflict with or constitute a default under, or result in
the acceleration of any obligation under, any agreement, indenture or loan or credit agreement or other instrument to which Indemnitor
or the Property is subject, or result in the violation of any law, rule, regulation, order, judgment or decree to which Indemnitor
or the Property is subject;

 

(c)     to
the best of Indemnitor’s knowledge, there is no action, suit, proceeding or investigation pending or threatened against
it which, either in any one instance or in the aggregate, could reasonably be expected to result in any material adverse change
in the business, operations, financial condition, properties or assets of Indemnitor, or in any material impairment of the right
or ability of Indemnitor to carry on its business substantially as now conducted, or in any material liability on the part of
Indemnitor, or which would draw into question the validity of this Agreement or of any action taken or to be taken in connection
with the obligations of Indemnitor contemplated herein, or which would be likely to impair materially the ability of Indemnitor
to perform under the terms of this Agreement;

 

(d)     it
does not believe, nor does it have any reason or cause to believe, that it cannot perform each and every covenant contained in
this Agreement;

 

(e)     to
the best of Indemnitor’s knowledge, no approval, authorization, order, license or consent of, or registration or filing
with, any Governmental Authority or other Person, and no approval, authorization or consent of any other Person is required in
connection with this Agreement; and

 

(f)      this
Agreement constitutes a valid, legal and binding obligation of Indemnitor, enforceable against it in accordance with the terms
hereof, except as such enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors’ rights generally, and by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).

 

14.    No
Waiver. No delay by any Indemnified Party in exercising any right, power or privilege under this Agreement shall operate as
a waiver of any such privilege, power or right.

 

15.    Notice
of Legal Actions. Each party hereto shall, within five (5) Business Days of receipt thereof, give written notice to the other
party hereto of (i) any notice, advice or other communication from any Governmental Authority or any source whatsoever with respect
to Hazardous Substances on, from or affecting the Property, and (ii) any legal action brought against such party or related to
the Property, with respect to which Indemnitor may have liability under this Agreement. Such notice shall comply with the provisions
of Section 19 hereof.

 

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16.    Examination
of Books and Records. Indemnified Parties and their accountants and other representatives shall have the right to examine
the records, books, management and other papers of Indemnitor which reflect upon its financial condition, at the Property or at
the office regularly maintained by Indemnitor where the books and records are located. Indemnified Parties and their accountants
and other representatives shall have the right to make copies and extracts from the foregoing records and other papers. In addition,
at reasonable times and upon reasonable notice, Indemnified Parties and their accountants and other representatives shall have
the right to examine and audit the books and records of Indemnitor pertaining to the income, expenses and operation of the Property
during reasonable business hours at the office of Indemnitor where the books and records are located.

 

17.    Transfer
of Loan. (a) Indemnitee may, at any time, sell, transfer, pledge or assign the Note, the Loan Agreement, the Mortgage, this
Agreement and the other Loan Documents to any Person, and any or all servicing rights with respect thereto, or grant participations
therein to any Person or issue mortgage pass-through certificates or other securities evidencing a beneficial interest in a rated
or unrated public offering or private placement (the “Securities”). Indemnitee may forward to each purchaser,
transferee, assignee, pledgee, servicer, participant or investor in such Securities or any credit rating agency rating such Securities
(the foregoing entities hereinafter collectively referred to as the “Investor”) and each prospective Investor,
all documents and information which Indemnitee now has or may hereafter acquire relating to Indemnitor and the Property, whether
furnished by Indemnitor, any guarantor or otherwise, as Indemnitee determines necessary or desirable. Borrower agrees to cooperate
with Indemnitee in connection with any transfer made or any Securities created pursuant to this Section, including, without limitation,
the delivery of an estoppel certificate required in accordance with the Loan Agreement and such other documents as may be reasonably
requested by Indemnitee. Borrower shall also furnish, and Borrower hereby consent to Indemnitee furnishing to such Investors or
such prospective Investors, any and all information concerning the financial condition of the Indemnitor and any and all information
concerning the Property and the Leases as may be reasonably requested by Indemnitee, any Investor or any prospective Investor
in connection with any sale, transfer or participation interest.

 

(b)     Upon
any transfer or proposed transfer contemplated above and by Section 9.1 of the Loan Agreement, at Indemnitee’s request,
Indemnitor shall provide an estoppel certificate to the Investor or any prospective Investor in such form, substance and detail
as Indemnitee, such Investor or prospective Investor may require.

 

18.    Notices.
All notices, demands, requests, consents, approvals or other communication (any of the foregoing, a “Notice”)
required, permitted or desired to be given hereunder shall be in writing and shall be sent by registered or certified mail, postage
prepaid, return receipt requested, or delivered by hand or by reputable overnight courier, addressed to the party to be so notified
at its address hereinafter set forth, or to such other address as such party may hereafter specify in accordance with the provisions
of this Section 18. Any Notice shall be deemed to have been received: (a) three (3) days after the date such Notice is
mailed, (b) on the date of delivery by hand if delivered during business hours on a Business Day (otherwise on the next Business
Day), and (c) on the next Business Day if sent by an overnight commercial courier, in each case addressed to the parties as follows:

 

    	11

    	 

    

 

	If to Indemnitee:	 	Ladder Capital Finance LLC
	 	 	345 Park Avenue
	 	 	8th Floor
	 	 	New York, New York 10154
	 	 	Attention: Pamela McCormack
	 	 	Facsimile No.: (212) 715-3199
	 	 	 
	With a copy to:	 	Winston & Strawn LLP
	 	 	200 Park Avenue
	 	 	New York, New York 10166
	 	 	Attention: Corey A. Tessler, Esq.
	 	 	Facsimile No.: (212) 294-4700
	 	 	 
	And with a copy to:	 	Wells Fargo Bank National Association
	 	 	Commercial Mortgage Servicing
	 	 	MAC D1086-120
	 	 	550 South Tryon Street, 14th Floor
	 	 	Charlotte, North Carolina 28202
	 	 	Attention: Asset Management
	 	 	 
	If to Principal:	 	c/o Moody National REIT I, Inc.
	 	 	6363 Woodway, Suite 110
	 	 	Houston, Texas 77057
	 	 	Attn:  Brett C. Moody
	 	 	 
	If to Borrower:	 	Moody National 2020-Grapevine Holding, LLC
	 	 	c/o Moody National REIT I, Inc.
	 	 	6363 Woodway, Suite 110
	 	 	Houston, Texas 77057
	 	 	Attn:  Brett C. Moody 

 

Any party may change
the address to which any such Notice is to be delivered by furnishing ten (10) days’ written notice of such change to the
other parties in accordance with the provisions of this Section 18. Notices shall be deemed to have been given on the date
set forth above, even if there is an inability to actually deliver any Notice because of a changed address of which no Notice
was given or there is a rejection or refusal to accept any Notice offered for delivery. Notice for any party may be given by its
respective counsel. Additionally, Notice from Lender may also be given by Servicer.

 

19.    Duplicate
Originals; Counterparts. This Agreement may be executed in any number of duplicate originals and each duplicate original shall
be deemed to be an original. This Agreement may be executed in several counterparts, each of which counterparts shall be deemed
an original instrument and all of which together shall constitute a single Agreement. The failure of any party hereto to execute
this Agreement, or any counterpart hereof, shall not relieve the other signatories from their obligations hereunder.

 

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20.    No
Oral Change. This Agreement, and any provisions hereof, may not be modified, amended, waived, extended, changed, discharged
or terminated orally or by any act or failure to act on the part of Indemnitor or any Indemnified Party, but only by an agreement
in writing signed by the party against whom enforcement of any modification, amendment, waiver, extension, change, discharge or
termination is sought.

 

21.    Headings,
Etc. The headings and captions of various paragraphs of this Agreement are for convenience of reference only and are not to
be construed as defining or limiting, in any way, the scope or intent of the provisions hereof.

 

22.    Number
and Gender. All pronouns and any variations thereof shall be deemed to refer to the masculine, feminine, neuter, singular
or plural as the identity of the Person or Persons referred to may require. Without limiting the effect of specific references
in any provision of this Agreement, the term “Indemnitor” shall be deemed to refer to each and every Person
comprising an Indemnitor from time to time, as the sense of a particular provision may require, and to include the heirs, executors,
administrators, legal representatives, successors and permitted assigns of Indemnitor, all of whom shall be bound by the provisions
of this Agreement, provided that no obligation of Indemnitor may be assigned except with the written consent of Indemnitee.
Each reference herein to Indemnitee shall be deemed to include its successors and assigns. 

 

23.    Successors
and Assigns. This Agreement shall be binding upon, and shall inure to the benefit of, Borrower and Lender and their respective
successors and permitted assigns. Lender may sell, assign, pledge, participate, transfer or delegate, as applicable, to one or
more persons, all or a portion of its rights and obligations under this Agreement and the other Loan Documents. Any assignee or
transferee of Lender shall be entitled to all the benefits afforded to Lender under this Agreement. Borrower shall not have the
right to assign, delegate or transfer its rights or obligations under this Agreement without the prior written consent of Lender,
and any attempted assignment, delegation or transfer without such consent shall be null and void.

 

24.    Release
of Liability. Any one or more parties liable upon or in respect of this Agreement may be released without affecting the liability
of any party not so released.

 

25.    Rights
Cumulative. The rights and remedies herein provided are cumulative and not exclusive of any rights or remedies which Indemnitee
has under the Note, the Mortgage, the Loan Agreement or the other Loan Documents or would otherwise have at law or in equity.

 

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26.    Inapplicable
Provisions. If any provision of this Agreement is held to be illegal, invalid or unenforceable under present or future laws
effective during the term of this Agreement, such provision shall be fully severable and this Agreement shall be construed and
enforced as if such illegal, invalid or unenforceable provision had never comprised a part of this Agreement, and the remaining
provision of this Agreement shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable
provision or by its severance from this Agreement, unless such continued effectiveness of this Agreement, as modified, would be
contrary to the basic understandings and intentions of the parties as expressed herein

 

27.      Governing
Law. (a) THIS AGREEMENT WAS NEGOTIATED IN THE STATE OF NEW YORK, AND MADE BY INDEMNITOR AND ACCEPTED BY INDEMNITEE IN THE
STATE OF NEW YORK, AND THE PROCEEDS OF THE NOTE SECURED HEREBY WERE DISBURSED FROM THE STATE OF NEW YORK, WHICH STATE THE PARTIES
AGREE HAS A SUBSTANTIAL RELATIONSHIP TO THE PARTIES AND TO THE UNDERLYING TRANSACTION EMBODIED HEREBY, AND IN ALL RESPECTS, INCLUDING,
WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE, THIS AGREEMENT AND THE OBLIGATIONS
ARISING HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS
MADE AND PERFORMED IN SUCH STATE (WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS) AND ANY APPLICABLE LAW OF THE UNITED STATES
OF AMERICA, EXCEPT THAT AT ALL TIMES THE PROVISIONS FOR THE CREATION, PERFECTION, AND ENFORCEMENT OF THE LIENS AND SECURITY INTERESTS
CREATED PURSUANT HERETO AND PURSUANT TO THE OTHER LOAN DOCUMENTS WITH RESPECT TO THE PROPERTY SHALL BE GOVERNED BY AND CONSTRUED
ACCORDING TO THE LAW OF THE STATE IN WHICH THE PROPERTY IS LOCATED, IT BEING UNDERSTOOD THAT, TO THE FULLEST EXTENT PERMITTED
BY THE LAW OF SUCH STATE, THE LAW OF THE STATE OF NEW YORK SHALL GOVERN THE CONSTRUCTION, VALIDITY AND ENFORCEABILITY OF ALL LOAN
DOCUMENTS AND ALL OF THE OBLIGATIONS ARISING HEREUNDER OR THEREUNDER. TO THE FULLEST EXTENT PERMITTED BY LAW, INDEMNITOR HEREBY
UNCONDITIONALLY AND IRREVOCABLY WAIVES ANY CLAIM TO ASSERT THAT THE LAW OF ANY OTHER JURISDICTION GOVERNS THIS AGREEMENT AND/OR
THE OTHER LOAN DOCUMENTS, AND THIS AGREEMENT AND/OR THE OTHER LOAN DOCUMENTS SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK PURSUANT TO SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.

 

    	14

    	 

    

 

(a)     ANY
LEGAL SUIT, ACTION OR PROCEEDING AGAINST INDEMNITEE OR INDEMNITOR ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE OTHER LOAN
DOCUMENTS MAY AT INDEMNITEE’S OPTION BE INSTITUTED IN ANY FEDERAL OR STATE COURT IN THE CITY OF NEW YORK, COUNTY OF NEW
YORK, PURSUANT TO SECTION 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW, AND IN ANY FEDERAL OR STATE COURT OF THE STATE OF TEXAS,
AND INDEMNITOR WAIVES ANY OBJECTIONS WHICH IT MAY NOW OR HEREAFTER HAVE BASED ON VENUE AND/OR FORUM NON CONVENIENS OF ANY SUCH
SUIT, ACTION OR PROCEEDING, AND INDEMNITOR HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION
OR PROCEEDING. INDEMNITOR DOES HEREBY AGREE THAT SERVICE OF PROCESS UPON INDEMNITOR AT THEIR NOTICE ADDRESS AS SET FORTH IN SECTION
11.6 OF THE LOAN AGREEMENT (OR SUCH OTHER NEW NOTICE ADDRESS ESTABLISHED BY INDEMNITOR UNDER THE LOAN AGREEMENT) BY REGISTERED
MAIL, RETURN RECEIPT REQUESTED, SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON INDEMNITOR IN ANY SUCH SUIT,
ACTION OR PROCEEDING AT THE TIME RECEIVED OR REFUSED BY INDEMNITOR. NOTHING CONTAINED HEREIN SHALL AFFECT THE RIGHT OF LENDER
TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST INDEMNITOR
IN ANY OTHER JURISDICTIONS.

 

28.    Miscellaneous. (a) Wherever pursuant to this Agreement (i) Indemnitee (or any other Indemnified Party) exercises any right given to it to approve
or disapprove any matter, (ii) any arrangement or term is to be satisfactory to Indemnitee (or any other Indemnified Party), or
(iii) any other decision or determination is to be made by Indemnitee (or any other Indemnified Party), the decision of Indemnitee
(or such other Indemnified Party) to approve or disapprove such matter, all decisions that arrangements or terms are satisfactory
to Indemnitee (or such other Indemnified Party) or not satisfactory and all other decisions and determinations made by Indemnitee
(or such other Indemnified Party), shall be in the sole and absolute discretion of Indemnitee (or such other Indemnified Party)
and shall be final and conclusive, except as may be otherwise expressly and specifically provided herein.

 

(b)     Wherever
pursuant to this Agreement it is provided that Indemnitor pay any costs and expenses, such costs and expenses shall include,
but not be limited to, legal fees and disbursements of Indemnitee and the other Indemnified Parties, whether retained outside
law firms, or as reimbursements for the expenses of in-house legal staff or otherwise.

 

(c)     Joint
and Several Liability. If Indemnitor consists of more than one person or party, the obligations and liabilities of each such
person or party hereunder shall be joint and several. 

 

[NO
FURTHER TEXT ON THIS PAGE]

 

    	15

    	 

    

 

IN WITNESS WHEREOF,
this Agreement has been executed by Indemnitor and is effective as of the day and year first above written.

 

	 	INDEMNITOR:
	 	 	 
	 	MOODY NATIONAL 2020-GRAPEVINE HOLDING, LLC,

a Delaware limited liability company
	 	 	 
	 	By:	/s/ Brett C. Moody
	 	 	Name: Brett C. Moody
	 	 	Title: President
	 	 	 
	 	/s/ Brett C. Moody
	 	BRETT C. MOODY, a natural person

 

[Signature Page to Environmental Indemnity
Agreement – Grapevine Residence Inn]

 

    	

    	 

    

  

SCHEDULE
I

 

Phase I Site Assessment Report of Residence Inn, Grapevine,
Texas, prepared by Nova Consulting, and dated March 21, 2014 (Nova Project No. R14-1051).

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