Document:

<PAGE>
                                                                   EXHIBIT 10.14

                              EMPLOYMENT AGREEMENT

         This Employment Agreement ("Agreement") is made and entered into on
this 25th day of September, 2000, effective as of the date set forth in
paragraph 2.1 below, and is by and between Terremark Worldwide, Inc., a Delaware
corporation (the "Company"), and Jose E Gonzalez (hereinafter called the
"Executive").

                                    RECITALS

         A. The Executive possesses knowledge and skills which the Company
believes will be of substantial benefit to its operations and success, and the
Company desires to employ the Executive on the terms and conditions set forth
below.

         B. The Executive is willing to make his services available to the
Company on the terms and conditions set forth below.

                                    AGREEMENT

         NOW, THEREFORE, in consideration of the premises and mutual covenants
set forth herein, the parties agree as follows:

         1.       Employment.

                  1.1      Employment and Term. The Company hereby agrees to
employ the Executive and the Executive hereby agrees to serve the Company on the
terms and conditions set forth herein.

                  1.2      Duties of Executive. During the Term of Employment
under this Agreement, the Executive shall serve as the General Counsel of the
Company, shall diligently perform all services as may be assigned to him by the
Board (provided that, such services shall not materially differ from the
services currently provided by the Executive), and shall exercise such power and
authority as may from time to time be delegated to him by the Board. The
Executive shall devote his full time and attention to the business and affairs
of the Company, render such services to the best of his ability, and use his
best efforts to promote the interests of the Company. It shall not be a
violation of this Agreement for the Executive to (i) serve on corporate, civic
or charitable boards or committees, (ii) deliver lectures, fulfill speaking
engagements or teach at educational institutions, or (iii) manage personal
investments, so long as such activities do not significantly interfere with the
performance of the Executive's responsibilities to the Company in accordance
with this Agreement.

         2.       Term.

                  2.1      Initial Term. The initial Term of Employment under
this Agreement, and the employment of the Executive hereunder, shall commence on
the date set forth above (the "Commencement Date") and shall expire on the date
that is twelve months after the Commencement Date, unless sooner terminated in
accordance with Section 5 hereof (the "Initial Term").

                  2.2      Renewal Terms. At the end of the Initial Term, the
Term of Employment automatically shall renew for successive one year terms
(subject to earlier termination as provided in

<PAGE>

Section 5 hereof), unless the Company or the Executive delivers written notice
to the other at least one month prior to the Expiration Date of its or his
election not to renew the Term of Employment.

                  2.3      Term of Employment and Expiration Date. The period
during which the Executive shall be employed by the Company pursuant to the
terms of this Agreement is sometimes referred to in this Agreement as the "Term
of Employment", and the date on which the Term of Employment shall expire
(including the date on which any renewal term shall expire), is sometimes
referred to in this Agreement as the "Expiration Date".

         3.       Compensation.

                  3.1      Base Salary. The Executive shall receive a base
salary at the annual rate of $175,000 (the "Base Salary") during the Term of
Employment, with such Base Salary payable in installments consistent with the
Company's normal payroll schedule, subject to applicable withholding and other
taxes. The Base Salary shall be reviewed, at least annually, for merit increases
and may, by action and in the sole discretion of the Board, be increased at any
time or from time to time.

                  3.2      Bonuses. During the Term of Employment, the Executive
shall be eligible to receive bonuses in such amounts and at such times as the
Board shall determine in its sole discretion.

         4.       Expense Reimbursement and Other Benefits.

                  4.1      Reimbursement of Expenses. Upon the submission of
proper substantiation by the Executive, and subject to such rules and guidelines
as the Company may from time to time adopt, the Company shall reimburse the
Executive for all reasonable expenses actually paid or incurred by the Executive
during the Term of Employment in the course of and pursuant to the business of
the Company. The Executive shall account to the Company in writing for all
expenses for which reimbursement is sought and shall supply to the Company
copies of all relevant invoices, receipts or other evidence reasonably requested
by the Company.

                  4.2      Compensation/Benefit Programs. During the term of
Employment, the Executive shall be entitled to participate in all medical,
dental, hospitalization, accidental death and dismemberment, disability, travel
and life insurance plans, and any and all other plans as are presently and
hereinafter offered by the Company to its executives, including savings,
pension, profit-sharing and deferred compensation plans, subject to the general
eligibility and participation provisions set forth in such plans.

                  4.3      Working Facilities. During the Term of Employment,
the Company shall furnish the Executive with an office, secretarial help and
such other facilities and services suitable to his/her position and adequate for
the performance of his/her duties hereunder.

                  4.4      Stock Options. During the Term of Employment, the
Executive shall be eligible to be granted options (the "Stock Options") to
purchase common stock (the "Common Stock") of the Company under (and therefore
subject to all terms and conditions of) the Company's 2000 Stock Option Plan, as
amended, and any successor plan thereto (the "Stock Option Plan") and all rules
of regulation of the Securities and Exchange Commission applicable to stock
option plans then in effect. The number of Stock Options and terms and
conditions of the Stock Options shall be determined by the Committee appointed
pursuant to the Stock Option Plan, or by the Board of Directors of the Company,
in its sole discretion and pursuant to the Stock Option Plan. Notwithstanding
the forgoing, the Company agrees to request its Board of Directors to issue to
the Executive 100,000 options for TWW common stock with a

                                      -2-
<PAGE>

market strike price, vesting 1/3, 1/3, 1/3 after one year, two years and three
years, respectively. If the unlikely event the Board refuses to do so, the
Executive may, at his option, immediately terminate this Agreement by written
notice to the Company.

                  4.5      Other Benefits. The Executive shall be entitled to
three weeks of vacation each calendar year during the Term of Employment,
(subject to the general eligibility provisions set forth in Company's personnel
policy), to be taken at such times as the Executive and the Company shall
mutually determine and provided that no vacation time shall interfere with the
duties required to be rendered by the Executive hereunder. Any vacation time not
taken by Executive during any calendar year may not be carried forward into any
succeeding calendar year. The Executive shall receive such additional benefits,
if any, as the Board of the Company shall from time to time determine.

         5.       Termination.

                  5.1      Termination for Cause. The Company shall at all times
have the right, upon written notice to the Executive, to terminate the Term of
Employment, for Cause. For purposes of this Agreement, the term "Cause" shall
mean (i) an action or omission of the Executive which constitutes a willful and
material breach of, or failure or refusal (other than by reason of his
disability) to perform his duties under, this Agreement which is not cured
within fifteen (15) days after receipt by the Executive of written notice of
same, (ii) fraud, embezzlement, misappropriation of funds or breach of trust in
connection with his services hereunder, (iii) conviction of a felony or any
other crime which involves dishonesty or a breach of trust, or (iv) gross
negligence in connection with the performance of the Executive's duties
hereunder, which is not cured within fifteen (15) days after written receipt by
the Executive of written notice of same. Any termination for Cause shall be made
in writing to the Executive, which notice shall set forth in detail all acts or
omissions upon which the Company is relying for such termination. The Executive
shall have the right to address the Board regarding the acts set forth in the
notice of termination. Upon any termination pursuant to this Section 5.1, the
Company shall only be obligated to pay to the Executive his Base Salary to the
date of termination. The Company shall have no further liability hereunder
(other than for reimbursement for reasonable business expenses incurred prior to
the date of termination, subject, however, to the provisions of Section 4.1).

                  5.2      Disability. The Company shall at all times have the
right, upon written notice to the Executive, to terminate the Term of
Employment, if the Executive shall become entitled to benefits under the
Company's group disability policy or any individual disability policy then in
effect, or, if the Executive shall as the result of mental or physical
incapacity, illness or disability, become unable to perform his obligations
hereunder for a period of 90 days in any 12-month period. The Company shall have
sole discretion based upon competent medical advice to determine whether the
Executive continues to be disabled. Upon any termination pursuant to this
Section 5.2, the Company shall (i) pay to the Executive any unpaid Base Salary
through the effective date of termination specified in such notice, (ii) pay to
the Executive a severance payment equal to one month of the Executive's Base
Salary at the time of the termination of the Executive's employment with the
Company. The Company shall have no further liability hereunder (other than for
reimbursement for reasonable business expenses incurred prior to the date of
termination, subject, however to the provisions of Section 4.1).

                  5.3      Death. Upon the death of the Executive during the
Term of Employment, the Company shall pay to the estate of the deceased
Executive any unpaid Base Salary through the Executive's date of death. The
Company shall have no further liability hereunder (other than for reimbursement
for reasonable business expenses incurred prior to the date of the Executive's
death, subject, however to the provisions of Section 4.1).

                                      -3-
<PAGE>

                  5.4      Termination Without Cause. At any time the Company
shall have the right to terminate the Term of Employment by written notice to
the Executive. Upon any termination pursuant to this Section 5.4 (that is not a
termination under any of Sections 5.1, 5.2, 5.3, 5.5 or 5.6), the Company shall
(i) pay to the Executive any unpaid Base Salary through the effective date of
termination specified in such notice, (ii) continue to pay the Executive's Base
Salary for a period (the " Continuation Period") through the date on which the
Term of Employment would have ended pursuant to Section 2 hereof in the absence
of an earlier termination pursuant to this Section 5 but in no event for more
than six (6) months from notice of termination hereunder, provided, however,
Executive shall have been employed by Company for a period of at least ninety
(90) days to be eligible for such payment, (iii) continue to provide the
Executive with the benefits he/she was receiving under Sections 4.2 and 4.4
hereof (the "Benefits") through the end of the Continuation Period in the manner
and at such times as the Incentive Compensation or Benefits otherwise would have
been payable or provided to the Executive, provided, however, Executive shall
have been employed by Company for a period of at least ninety (90) days to be
eligible for such Benefits or payment of the cash value of such Benefits, as set
forth below. In the event that the Company is unable to provide the Executive
with any Benefits required hereunder by reason of the termination of the
Executive's employment pursuant to this Section 5.4, then the Company shall pay
the Executive cash equal to the value of the Benefit that otherwise would have
accrued for the Executive's benefit under the plan, for the period during which
such Benefits could not be provided under the plans. The Company's good faith
determination of the amount that would have been contributed or the value of any
Benefits that would have accrued under any plan shall be binding and conclusive
on the Executive. For this purpose, the Company may use as the value of any
Benefit the cost to the Company of providing that Benefit to the Executive.
Further, the vesting of the Executive's Stock Options, if any, shall be subject
to the terms of the Stock Option Plan. The Company shall have no further
liability hereunder (other than for (x) reimbursement for reasonable business
expenses incurred prior to the date of termination, subject, however, to the
provisions of Section 4.1, and (y) payment of compensation for unused vacation
days that have accumulated during the calendar year in which such termination
occurs). For all purposes under this Agreement, the failure by Company to offer
to renew the Agreement following the expiration of the Initial Term or any
Renewal Term on the same terms and conditions hereunder shall be treated as if
the Company terminated this Agreement pursuant to this Section 5.4.

                  5.5      Termination by Executive.

                           (a)      The Executive shall at all times have the
right, upon sixty (60) days written notice to the Company, to terminate the Term
of Employment.

                           (b)      Upon termination of the Term of Employment
pursuant to this Section 5.5 (that is not a termination under Section 5.6) by
the Executive without Good Reason, the Company shall pay to the Executive any
unpaid Base Salary through the effective date of termination specified in such
notice. The Company shall have no further liability hereunder (other than for
reimbursement for reasonable business expenses incurred prior to the date of
termination, subject, however, to the provisions of Section 4.1). At the
Company's sole option, upon receipt of notice from the Executive pursuant to
this Section, the Company may immediately terminate the Term of Employment, in
which case, in addition to the covenants set forth above, the Company shall pay
the Executive 60 days of Base Salary. For all purposes under this Agreement, the
failure by Executive to offer to renew the Agreement following the expiration of
the Initial Term or any Renewal Term on the same terms and conditions hereunder
shall be treated as if the Executive terminated this Agreement pursuant to this
Section 5.5, except that the Executive shall not be entitled to any Base Salary
in excess of that which is due through the last day of Executive's employment
hereunder.

                                      -4-
<PAGE>

                           (c)      Upon termination of the Term of Employment
pursuant to this Section 5.5 (that is not a termination under Section 5.6) by
the Executive for Good Reason, the Company shall pay to the Executive the same
amounts that would have been payable by the Company to the Executive under
Section 5.4 of this Agreement if the Term of Employment had been terminated by
the Company without Cause. The Company shall have no further liability
hereunder.

                           (d)      For purposes of this Agreement, "Good
Reason" shall mean (i) the assignment to the Executive of any duties or
responsibilities inconsistent in any respect with the Executive's position or a
similar position in the Company or one of its subsidiaries, as contemplated by
Section 1.2 of this Agreement, or any other action by the Company which results
in a substantial and compelling diminution in such position, authority, duties
or responsibilities, excluding for this purpose an isolated, insubstantial and
inadvertent action not taken in bad faith and which is remedied by the Company
promptly after receipt of notice thereof given by the Executive; (ii) any
failure by the Company to comply with any of the provisions of Article 3 of this
Agreement, other than an isolated, insubstantial and inadvertent failure not
occurring in bad faith and which is remedied by the Company promptly after
receipt of notice thereof given by the Executive; (iii) the Company's requiring
the Executive to be based at any office or location outside of the area for
which Executive was originally hired to work except for travel reasonably
required in the performance of the Executive's responsibilities. For purposes of
this Section 5.5(d), any good faith determination of "Good Reason" made by the
Board shall be conclusive.

                  5.6      Change in Control of the Company.

                           (a)      In the event that (i) a Change in Control
(as defined in paragraph (b) of this Section 5.6) in the Company shall occur
during the Term of Employment, and (ii) prior to the later of the Expiration
Date or one year after the date of the Change in Control, either (x) the Term of
Employment is terminated by the Company without Cause, pursuant to Section 5.4
hereof or (y) the Executive terminates the Term of Employment for Good Reason
the Company shall (1) pay to the Executive any unpaid Base Salary through the
effective date of termination, (2) pay to the Executive as a single lump sum
payment, within 30 days of the termination of his employment hereunder, a lump
sum payment equal to the sum of (x) two times the sum of Executive's annual Base
Salary, Incentive Compensation, and the value of the annual fringe benefits
(based upon their cost to the Company) required to be provided to the Executive
under Sections 4.2 and 4.4 hereof, for the year immediately preceding the year
in which his employment terminates, plus (y) the value of the portion of his
benefits under any savings, pension, profit sharing or deferred compensation
plans that are forfeited under those plans by reason of the termination of his
employment hereunder. The Company shall have no further liability hereunder
(other than for (1) reimbursement for reasonable business expenses incurred
prior to the date of termination, subject, however, to the provisions of Section
4.1, and (2) payment of compensation for unused vacation days that have
accumulated during the calendar year in which such termination occurs).

                           (b)      For purposes of this Agreement, the term
"Change in Control" shall mean:

                                    (i)      Approval by the shareholders of the
Company of (x) a reorganization, merger, consolidation or other form of
corporate transaction or series of transactions, in each case, with respect to
which persons who were the shareholders of the Company immediately prior to such
reorganization, merger or consolidation or other transaction do not, immediately
thereafter, own more than 50% of the combined voting power entitled to vote
generally in the election of directors of the reorganized, merged or
consolidated company's then outstanding voting securities, in substantially the

                                      -5-
<PAGE>

same proportions as their ownership immediately prior to such reorganization,
merger, consolidation or other transaction, or (y) a liquidation or dissolution
of the Company or (z) the sale of all or substantially all of the assets of the
Company (unless such reorganization, merger, consolidation or other corporate
transaction, liquidation, dissolution or sale is subsequently abandoned);

                                    (ii)     the acquisition (other than from
the Company) by any person, entity or "group", within the meaning of Section
13(d)(3) or 14(d)(2) of the Securities Exchange Act, of more than 30% of either
the then outstanding shares of the Company's Common Stock or the combined voting
power of the Company's then outstanding voting securities entitled to vote
generally in the election of directors (hereinafter referred to as the ownership
of a "Controlling Interest") excluding, for this purpose, any acquisitions by
(1) the Company or its Subsidiaries, (2) any person, entity or "group" that as
of the Commencement Date of this Agreement owns beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Securities Exchange Act) of a
Controlling Interest or (3) any employee benefit plan of the Company or its
Subsidiaries.

                                    (iii)     The resignation of Manuel D.
Medina as both Chairman and CEO of the Company, his death, or his absence from
the day to day business affairs of the Company for more than 90 consecutive days
due to disability or incapacity.

                  5.7      Resignation. Upon any notice or termination of
employment pursuant to this Article 5, the Executive shall automatically and
without further action be deemed to have resigned as an officer, and if he or
she was then serving as a director of the Company, as a director, and if
required by the Board, the Executive hereby agrees to immediately execute a
resignation letter to the Board.

                  5.8      Survival. The provisions of this Article 5 shall
survive the termination of this Agreement, as applicable.

         6.       Restrictive Covenants.

                  6.1      Non-competition. At all times while the Executive is
employed by the Company and for a one year period after the termination of the
Executive's employment with the Company for any reason (other than by the
Company without Cause (as defined in Section 5.1 hereof) or by the Executive for
Good Reason (as defined in Section 5.5(d) hereof)), the Executive shall not,
directly or indirectly, engage in or have any interest in any sole
proprietorship, partnership, corporation or business or any other person or
entity (whether as an employee, officer, director, partner, agent, security
holder, creditor, consultant or otherwise) that directly or indirectly (or
through any affiliated entity) engages in competition with the Company (based on
the business in which the Company was engaged or was actively planning on being
engaged as of the date of termination of the Executive's employment and in the
geographic areas in which the Company operated or was actively planning on
operating as of date of termination of the Executive's employment); provided
that such provision shall not apply to the Executive's ownership of: Common
Stock of the Company or the acquisition by the Executive, solely as an
investment, of securities of any issuer that is registered under Section 12(b)
or 12(g) of the Securities Exchange Act of 1934, as amended, and that are listed
or admitted for trading on any United States national securities exchange or
that are quoted on the National Association of Securities Dealers Automated
Quotations System, or any similar system or automated dissemination of
quotations of securities prices in common use, so long as the Executive does not
control, acquire a controlling interest in or become a member of a group which
exercises direct or indirect control or, more than five percent of any class of
capital stock of such corporation.

                                      -6-
<PAGE>

                  6.2      Nondisclosure. The Executive shall not at any time
divulge, communicate, use to the detriment of the Company or for the benefit of
any other person or persons, or misuse in any way, any Confidential Information
(as hereinafter defined) pertaining to the business of the Company. Any
Confidential Information or data now or hereafter acquired by the Executive with
respect to the business of the Company (which shall include, but not be limited
to, information concerning the Company's financial condition, prospects,
technology, customers, suppliers, sources of leads and methods of doing
business) shall be deemed a valuable, special and unique asset of the Company
that is received by the Executive in confidence and as a fiduciary, and
Executive shall remain a fiduciary to the Company with respect to all of such
information. For purposes of this Agreement, "Confidential Information" means
information disclosed to the Executive or known by the Executive as a
consequence of or through his employment by the Company (including information
conceived, originated, discovered or developed by the Executive) prior to or
after the date hereof, and not generally known, about the Company or its
business. Notwithstanding the foregoing, nothing herein shall be deemed to
restrict the Executive from disclosing Confidential Information to the extent
required by law.

                  6.3      Nonsolicitation of Employees and Clients. At all
times while the Executive is employed by the Company and for a two (2) year
period after the termination of the Executive's employment with the Company for
any reason, the Executive shall not, directly or indirectly, for himself or for
any other person, firm, corporation, partnership, association or other entity
(a) employ or attempt to employ or enter into any contractual arrangement with
any employee or former employee of the Company, unless such employee or former
employee has not been employed by the Company for a period in excess of six
months, and/or (b) call on or solicit any of the actual or targeted prospective
clients of the Company on behalf of any person or entity in connection with any
business competitive with the business of the Company, nor shall the Executive
make known the names and addresses of such clients or any information relating
in any manner to the Company's trade or business relationships with such
customers, other than in connection with the performance of Executive's duties
under this Agreement.

                  6.4      Ownership of Developments. All copyrights, patents,
trade secrets, or other intellectual property rights associated with any ideas,
concepts, techniques, inventions, processes, or works of authorship developed or
created by Executive during the course of performing work for the Company or its
clients (collectively, the "Work Product") shall belong exclusively to the
Company and shall, to the extent possible, be considered a work made by the
Executive for hire for the Company within the meaning of Title 17 of the United
States Code. To the extent the Work Product may not be considered work made by
the Executive for hire for the Company, the Executive agrees to assign, and
automatically assign at the time of creation of the Work Product, without any
requirement of further consideration, any right, title, or interest the
Executive may have in such Work Product. Upon the request of the Company, the
Executive shall take such further actions, including execution and delivery of
instruments of conveyance, as may be appropriate to give full and proper effect
to such assignment.

                  6.5      Books and Records. All books, records, and accounts
relating in any manner to the customers or clients of the Company, whether
prepared by the Executive or otherwise coming into the Executive's possession,
shall be the exclusive property of the Company and shall be returned immediately
to the Company on termination of the Executive's employment hereunder or on the
Company's request at any time.

                  6.6      Definition of Company. Solely for purposes of this
Article 6, the term "Company" also shall include any existing or future
subsidiaries of the Company that are operating during the time periods described
herein and any other entities that directly or indirectly, through one or

                                      -7-
<PAGE>

more intermediaries, control, are controlled by or are under common control with
the Company during the periods described herein.

                  6.7      Acknowledgment by Executive. The Executive
acknowledges and confirms that (a) the restrictive covenants contained in this
Article 6 are reasonably necessary to protect the legitimate business interests
of the Company, and (b) the restrictions contained in this Article 6 (including
without limitation the length of the term of the provisions of this Article 6)
are not overbroad, overlong, or unfair and are not the result of overreaching,
duress or coercion of any kind. The Executive further acknowledges and confirms
that his full, uninhibited and faithful observance of each of the covenants
contained in this Article 6 will not cause him any undue hardship, financial or
otherwise, and that enforcement of each of the covenants contained herein will
not impair his ability to obtain employment commensurate with his abilities and
on terms fully acceptable to him or otherwise to obtain income required for the
comfortable support of him and his family and the satisfaction of the needs of
his creditors. The Executive acknowledges and confirms that his special
knowledge of the business of the Company is such as would cause the Company
serious injury or loss if he were to use such ability and knowledge to the
benefit of a competitor or were to compete with the Company in violation of the
terms of this Article 6. The Executive further acknowledges that the
restrictions contained in this Article 6 are intended to be, and shall be, for
the benefit of and shall be enforceable by, the Company's successors and
assigns.

                  6.8      Reformation by Court. In the event that a court of
competent jurisdiction shall determine that any provision of this Article 6 is
invalid or more restrictive than permitted under the governing law of such
jurisdiction, then only as to enforcement of this Article 6 within the
jurisdiction of such court, such provision shall be interpreted and enforced as
if it provided for the maximum restriction permitted under such governing law.

                  6.9      Extension of Time. If the Executive shall be in
violation of any provision of this Article 6, then each time limitation set
forth in this Article 6 shall be extended for a period of time equal to the
period of time during which such violation or violations occur. If the Company
seeks injunctive relief from such violation in any court, then the covenants set
forth in this Article 6 shall be extended for a period of time equal to the
pendency of such proceeding including all appeals by the Executive.

                  6.10     Survival. The provisions of this Article 6 shall
survive the termination of this Agreement, as applicable.

         7.       Injunction. It is recognized and hereby acknowledged by the
parties hereto that a breach by the Executive of any of the covenants contained
in Article 6 of this Agreement will cause irreparable harm and damage to the
Company, the monetary amount of which may be virtually impossible to ascertain.
As a result, the Executive recognizes and hereby acknowledges that the Company
shall be entitled to an injunction from any court of competent jurisdiction
enjoining and restraining any violation of any or all of the covenants contained
in Article 6 of this Agreement by the Executive or any of his affiliates,
associates, partners or agents, either directly or indirectly, and that such
right to injunction shall be cumulative and in addition to whatever other
remedies the Company may possess.

         8.       Assignment. Neither party shall have the right to assign or
delegate his rights or obligations hereunder, or any portion thereof, to any
other person.

         9.       Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Florida.

                                      -8-
<PAGE>

         10.      Section 162(m) Limits. Notwithstanding any other provision of
this Agreement to the contrary, if and to the extent that any remuneration
payable by the Company to the Executive for any year would exceed the maximum
amount of remuneration that the Company may deduct for that year under Section
162(m) ("Section 162(m)") of the Internal Revenue Code of 1986, as amended (the
"Code"), payment of the portion of the remuneration for that year that would not
be so deductible under Section 162(m) shall, in the sole discretion of the
Board, be deferred and become payable at such time or times as the Board
determines that it first would be deductible by the Company under Section
162(m), with interest at the "short-term applicable rate" as such term is
defined in Section 1274(d) of the Code. The limitation set forth under this
Section 10 shall not apply with respect to any amounts payable to the Executive
pursuant to Article 5 hereof.

         11.      Entire Agreement. This Agreement constitutes the entire
agreement between the parties hereto with respect to the subject matter hereof
and, upon its effectiveness, shall supersede all prior agreements,
understandings and arrangements, both oral and written, between the Executive
and the Company (or any of its affiliates) with respect to such subject matter.
This Agreement may not be modified in any way unless by a written instrument
signed by both the Company and the Executive.

         12.      Notices: All notices required or permitted to be given
hereunder shall be in writing and shall be personally delivered by courier, sent
by registered or certified mail, return receipt requested or sent by confirmed
facsimile transmission addressed as set forth herein. Notices personally
delivered, sent by facsimile or sent by overnight courier shall be deemed given
on the date of delivery and notices mailed in accordance with the foregoing
shall be deemed given upon the earlier of receipt by the addressee, as evidenced
by the return receipt thereof, or three (3) days after deposit in the U.S. mail.
Notice shall be sent (i) if to the Company, addressed to Terremark Worldwide,
Inc., 2601 S. Bayshore Drive, 9th Floor, Miami, Florida 33133, Attn: Brian K.
Goodkind, Executive Vice-President and Chief Operating Officer, and (ii) if to
the Executive, to his address as reflected on the payroll records of the
Company, or to such other address as either party hereto may from time to time
give notice of to the other.

         13.      Benefits; Binding Effect. This Agreement shall be for the
benefit of and binding upon the parties hereto and their respective heirs,
personal representatives, legal representatives, successors and, where
applicable, assigns, including, without limitation, any successor to the
Company, whether by merger, consolidation, sale of stock, sale of assets or
otherwise.

         14.      Severability. The invalidity of any one or more of the words,
phrases, sentences, clauses or sections contained in this Agreement shall not
affect the enforceability of the remaining portions of this Agreement or any
part thereof, all of which are inserted conditionally on their being valid in
law, and, in the event that any one or more of the words, phrases, sentences,
clauses or sections contained in this Agreement shall be declared invalid, this
Agreement shall be construed as if such invalid word or words, phrase or
phrases, sentence or sentences, clause or clauses, or section or sections had
not been inserted. If such invalidity is caused by length of time or size of
area, or both, the otherwise invalid provision will be considered to be reduced
to a period or area which would cure such invalidity.

         15.      Waivers. The waiver by either party hereto of a breach or
violation of any term or provision of this Agreement shall not operate nor be
construed as a waiver of any subsequent breach or violation.

         16.      Damages. Nothing contained herein shall be construed to
prevent the Company or the Executive from seeking and recovering from the other
damages sustained by either or both of them as a result of its or his breach of
any term or provision of this Agreement. In the event that either party hereto

                                      -9-
<PAGE>

brings suit for the collection of any damages resulting from, or the injunction
of any action constituting, a breach of any of the terms or provisions of this
Agreement, then the party found to be at fault shall pay all reasonable court
costs and attorneys' fees of the other.

         17.      Section Headings. The section headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.

         18.      No Third Party Beneficiary. Nothing expressed or implied in
this Agreement is intended, or shall be construed, to confer upon or give any
person other than the Company, the parties hereto and their respective heirs,
personal representatives, legal representatives, successors and assigns, any
rights or remedies under or by reason of this Agreement.

         19.      Indemnification. The indemnification obligations of the
Company to Executive shall be in accordance with the Company's standard
indemnity agreement.

         IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first above written.

                                          COMPANY:
                                          Terremark Worldwide, Inc
                                          --------------------------------

                                          By: /s/ Brian K. Goodkind
                                             -----------------------------
                                          Name:  Brian K. Goodkind
                                          Title: Executive Vice President

                                          EXECUTIVE:

                                          /s/ Jose E. Gonzalez
                                          --------------------------------
                                          Name: Jose E. Gonzalez

                                      -10-<PAGE>

EXHIBIT 10.1                                                      EXECUTION COPY

                         LEASEHOLD ACQUISITION AGREEMENT

         THIS LEASEHOLD ACQUISITION AGREEMENT (the "Agreement") is made and
entered into as of this 28th day of June, 2002, by and among CapStar Winston
Company, LLC ("CapStar"), Meristar Management Company, LLC (the "Manager"),
Winston Hotels, Inc. ("Winston"), WINN Limited Partnership ("WINN"), Evanston
Hotel Associates, LLC ("Evanston"), Marsh Landing Hotel Associates, LLC ("Marsh
Landing" and, together with WINN and Evanston, the "Lessors") and Barclay
Hospitality Services Inc. ("Barclay"). The Agreement is effective as of July 1,
2002 (the "Effective Date").

                                   WITNESSETH:

         WHEREAS, CapStar has entered into lease agreements with the Lessors
with respect to the forty-seven (47) hotels described in Exhibit A (the
"Hotels") (as such agreements may have been amended or modified, each a "Lease
Agreement" and collectively, the "Lease Agreements"); and

         WHEREAS, the parties desire to provide for the purchase and assignment
of the Lease Agreements subject to the terms and conditions described herein;
and

         WHEREAS, thirty-nine (39) of the Hotels described in Exhibit A are
managed by Meristar Management Company, LLC, an affiliate of CapStar; and

         WHEREAS, seven (7) of the Hotels (the "IMIC Hotels") are managed by the
Interstate Management and Investment Corporation ("IMIC") and one (1) Hotel (the
"Hilton Hotel") is managed by the Hilton Corporation ("Hilton"); and

         WHEREAS, the parties desire to set forth other agreements and covenants
as set forth herein;

         NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
expressly acknowledged, the parties do hereby agree as follows:

                                    AGREEMENT

         NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements hereinafter set forth, the parties hereto do hereby
agree as follows:

         1. Assignment and Assumption of Lease Agreements and Leasehold Assets.

                  (a) CapStar hereby conveys, sells, transfers, assigns and
delivers to Barclay as of the Effective Date the Lease Agreements and, as
contemplated by Section 1(b) hereof, the Leasehold Assets (as hereinafter
defined). Barclay hereby assumes as of the Effective Date the Lease Agreements
and the Leasehold Assets and, subject to the provisions of Section 3 hereof,

<PAGE>

all liabilities and/or obligations of CapStar arising under the Lease Agreements
and/or the Leasehold Assets to the extent (i) such liabilities and/or
obligations arise or are incurred with respect to periods from and after the
Effective Date or (ii) to the extent Barclay or Winston receives a credit
therefor on the Estimated Settlement Statement or Actual Settlement Statement
(as defined in Section 6 hereof), such liabilities and/or obligations are paid
or performed or remain to be paid or performed from and after the Effective Date
but first arose or were incurred with respect to periods prior to the Effective
Date.

                  (b) Upon the terms and subject to the conditions set forth in
this Agreement, CapStar hereby conveys, sells, transfers, assigns and delivers
to Barclay as of 12:01 AM on the Effective Date (the "Cut-off Time"), and
Barclay hereby assumes and accepts from CapStar as of the Cut-off Time, all
right, title and interest of CapStar in and to the following assets, properties,
rights (contractual or otherwise) of CapStar relating to the Lease Agreements
and/or the Hotels (collectively, the "Leasehold Assets"):

                           (i) All expendable supplies, including, but not
         limited to, all china, glassware, linens, towels, washcloths, bedding,
         napkins, tablecloths, silverware, kitchen and bar small goods, paper
         goods, guest supplies, cleaning and maintenance supplies, office
         supplies, operating supplies, printing, stationery and uniforms owned
         by CapStar or the Manager and located at the Hotels or held in storage
         for use at the Hotels (the "Expendables");

                           (ii) All fixtures, furniture, furnishings, fittings,
         equipment, machinery, apparatus, appliances, computer hardware and
         equipment, software, reservations terminals, vehicles, building
         materials, telephones and other communications equipment, copiers,
         facsimile machines, postal machines, televisions, signs, vacuum
         cleaners, video equipment and other articles of personal property owned
         by CapStar or the Manager and located at the Hotels or held in storage
         for use at the Hotels, excluding therefrom (A) all property owned by
         any hotel franchisor or by any tenant under a Space Lease (as defined
         in Section 2(b)(ix) hereof) and (B) the property listed on Exhibit B
         (the "Furnishings");

                           (iii) All opened and unopened food and beverages
         (alcoholic and non-alcoholic) owned by CapStar or the Manager and
         located at the Hotels or held in storage for use at the Hotels
         ("Consumables");

                           (iv) All service and equipment contracts, employment
         agreements, union contracts, purchase orders, equipment leases, and
         other contracts or agreements relating to the ownership, operation,
         maintenance, provisioning or equipping of the Hotels, together with all
         assignable related written warranties and guaranties (individually and
         collectively, "Contracts"). The parties acknowledge and agree that the
         Contracts may be subject to the terms of certain master agreements
         pursuant to which goods are provided and/or services rendered to
         properties owned, leased or managed by CapStar, the Manager and/or
         their respective affiliates, but that any and all right, title or
         interest which CapStar or the Manager or their respective affiliates
         may have in such master agreements are not included within the
         definition of Contracts and are not being assigned or assumed under
         this Agreement;

                                      -2-

<PAGE>

                           (v) All goodwill, trade names and logos (if any, and
         used solely in connection with the Hotels, and only to the extent of
         CapStar's or the Manager's interest therein, if any), the Hotels'
         websites and web addresses, if any, and the Hotels' telephone numbers;

                           (vi) All contracts or reservations for the use or
         occupancy of guest rooms, meeting rooms and/or banquet facilities of
         the Hotels, and (except to the extent Barclay has received a credit
         therefor on the Estimated Settlement Statement or the Actual Settlement
         Statement) all advance deposits with respect thereto.

                           (vii) All books of original financial entry, books of
         account and other records with respect to the Hotels only, and all
         guest lists, customer files, group files, sales records, sales
         literature, brochures and other written marketing materials used in
         conducting the business and operations of the Hotels, to the extent in
         the possession of CapStar or the Manager, in such form as they exist on
         the Effective Date and to the extent not consolidated with items
         relating to other hotels owned, leased or managed by CapStar, the
         Manager or their respective affiliates (but the parties hereto
         acknowledge and agree that such books, records, lists, files, records
         and other items shall be with respect to the Hotels, and the guests and
         customers of the Hotels, only and not books, records, lists, files,
         records and other items of CapStar, the Manager and/or their affiliates
         which relate to hotels other than the Hotels);

                           (viii) All governmental licenses, permits,
         certificates, authorizations and approvals, to the extent transferable,
         used in or relating to the ownership, leasing, occupancy or operations
         of the Hotels including, without limitation, those necessary for the
         sale and on-premises consumption of liquor and other alcoholic
         beverages, to the extent held by CapStar or the Manager (individually
         and collectively, the "Permits");

                           (ix) All leases, subleases and other agreements for
         the use of space at the Hotels, including, but not limited to,
         agreements for the use of rooftop space of the Hotels for
         communications (individually and collectively, the "Space Leases").
         Barclay understands and agrees that rents received under any
         communications leases may be net of commissions due to third party
         brokers;

                           (x) All accounts receivable and guest ledger
         receivables, but only to the extent CapStar has received a credit
         therefor on the Estimated Settlement Statement or the Actual Settlement
         Statement

                           (xi) All petty cash funds at the Hotels and cash in
         house banks, but only to the extent CapStar has received a credit
         therefor on the Estimated Settlement Statement or the Actual Settlement
         Statement

                           (xii) All of CapStar's rights and obligations in, to
         and under the franchise agreements and licenses for the Hotels; and

                           (xiii) All of CapStar's rights and obligations in, to
         and under the

                                      -3-
<PAGE>

         management agreements for the IMIC and Hilton Hotels (individually and
         collectively, the "Third Party Management Agreements"); and

                           (xiv) All other expense items, including, without
         limitation, operating expenses, trade accounts, accounts payable,
         utility charges, taxes and other matters, for which Barclay receives a
         credit on the Estimated Settlement Statement or the Actual Settlement
         Statement.

The parties to this Agreement acknowledge and agree that (i) the Leasehold
Assets do not include any computer software which is proprietary to CapStar, the
Manager and/or their affiliates, and (ii) to the extent any Leasehold Assets are
subject to, used by or licensed to CapStar or the Manager under any license or
franchise agreement, including without limitation a hotel franchise agreement,
or are subject to any Contract, such transfer to and use by any New Lessee of
such Leasehold Assets shall be subject to (A) the terms and conditions of such
license, franchise agreement, or Contract and (B) all rights in such Leasehold
Assets held by the licensor or franchisor under such license or franchise
agreement, or the contract party under such Contract.

                  (c) Neither CapStar nor the Manager shall have any obligation
to obtain any consents which may be required with respect to the assignment of
any Contracts, Permits or Space Leases; provided, however, that CapStar and the
Manager shall cooperate with Barclay in obtaining any consent required in
connection with transferable Permits and further provided that if any consent
required under any Contract, Permit or Space Lease is not obtained and, as a
result, Barclay is prevented from obtaining the benefits of such Contract,
Permit or Space Lease, CapStar and the Manager shall cooperate with Barclay in
any reasonable and lawful arrangement designed to provide for Barclay the
benefits of such Contract, Permit or Space Lease. Barclay shall reimburse
CapStar and/or the Manager for any reasonable out-of pocket expenses that they
incur in connection with any such cooperation. Barclay and the Lessors shall
jointly and severally indemnify, defend and hold CapStar and the Manager
harmless from and against any cost, expense, loss, claim or other obligation or
liability, including without limitation reasonable attorneys' fees and expenses,
arising in connection with such arrangement. The parties acknowledge and agree
that the provisions of this Section 1(c) shall not apply to hotel franchise
agreements or liquor licenses, which are dealt with pursuant to Section 6(d) and
(f) of this Agreement.

                  (d) Barclay and the Lessors agree that the premises demised
under the Lease Agreements and the Leasehold Assets shall be assigned, and
Barclay shall assume the premises demised under the Lease Agreements and the
Leasehold Assets, on the Effective Date as is, where is, with all faults with no
right of set-off or reduction in the Purchase Price (except as provided for in
this Agreement), and that such assignment and assumption shall be, except as
provided for in this Agreement, without representation or warranty of any kind,
whether express, implied, statutory or otherwise, and Capstar and Manager hereby
disclaim and renounce any such representation or warranty. Barclay and the
Lessors specifically acknowledge that, except as provided for in this Agreement,
Barclay and Lessors are not relying and shall not rely on any representations or
warranties of any kind whatsoever, whether express, implied, statutory or
otherwise, from Capstar or Manager as to any matters ("Matters") concerning the
Lease

                                      -4-
<PAGE>

Agreements and/or the Leasehold Assets, including without limitation (A) the
condition of the premises demised under the Lease Agreements and/or the
Leasehold Assets, (B) whether the furnishings are in working order; (C) the
livability or suitability for occupancy of any structure and the quality of its
construction; (D) the amount, condition or fitness of any personal property,
including without limitation Expendables, Furnishings, Consumables and other
inventory; or (E) whether the improvements are structurally sound or in good
condition, or in compliance with applicable governmental statutes, codes or
ordinances. Notwithstanding anything to the contrary in this Agreement, Lessors
and Barclay hereby release and discharge Capstar and (except to the extent
Manager has indemnified Barclay with respect thereto under the New Management
Agreements) Manager with respect to all such Matters.

                  (e) Barclay, WINN and Winston Hotels, Inc. acknowledge and
agree that the parties hereto intended that Winston SPE LLC ("Winston SPE")
would be included as a party to this Agreement as one of the Lessors and one of
the Winston Parties and that Winston SPE's consent is required to assign the
Leases under which Winston SPE is a Lessor pursuant to this Agreement. Winston
SPE is not a party to this Agreement only because Winston SPE's managing member,
Winston Manager Corporation, a Virginia corporation and a wholly-owned
subsidiary of Winston Hotels, Inc. ("Winston Manager Corporation"), which is the
only entity authorized under Winston SPE's operating agreement to enter into
binding agreements on Winston SPE's behalf, is not, as of the date of this
Agreement, validly existing and in good standing as a corporation in the State
of Virginia with the State Corporation Commission of Virginia. Winston Hotels,
Inc. hereby covenants and undertakes to take all steps necessary to cause
Winston Manager Corporation, as the managing member of Winston SPE, (i) to
become reinstated as a corporation in good standing in Virginia as soon as
reasonably possible after the date of this Agreement and (ii) once such
reinstatement has been accomplished, to execute and deliver, as the managing
member of Winston SPE, a signature page counterpart to this Agreement, or such
other document, agreement or instrument acceptable to Capstar, to Capstar and
Manager indicating that Winston SPE is a Lessor and one of the Winston Parties
for all purposes of this Agreement, and has become a party to this Agreement, as
of the Effective Date, consents to the assignment of the Leases under which
Winston SPE is the Lessor to Barclay pursuant to this Agreement, and is bound by
all of the terms and conditions of this Agreement applicable to the Lessors or
the Winston Parties. Winston Hotels, Inc. hereby agrees to indemnify, defend and
hold harmless the MeriStar Indemnified Parties (as defined in Section 3(a)
below) from and against any and all Obligations (as defined in Section 3(a)
below) that are incurred by any of the MeriStar Indemnified Parties as a result
of (i) the failure of Winston SPE to become a party to this Agreement as a
Lessor and a Winston Party on the date hereof and (ii) the failure of Winston
Hotels, Inc. to perform its obligations under this Section 1(e).

                  (f) Barclay, WINN and Winston Hotels, Inc. acknowledge and
agree that the parties hereto intended that Evanston Hotel Associates, LLC
("Evanston") would be included as a party to this Agreement as one of the
Lessors and that Evanston's consent is required to assign the Lease under which
Evanston is a Lessor pursuant to this Agreement. Evanston has not executed this
Agreement on the date hereof only because the individual authorized to execute
the Agreement on behalf of Evanston unable at this time to execute the
Agreement. Winston Hotels, Inc. hereby covenants and undertakes to use its best
efforts to cause Evanston to execute and

                                      -5-
<PAGE>

deliver a signature page counterpart to this Agreement, or such other document,
agreement or instrument acceptable to Capstar, to Capstar and Manager indicating
that Evanston is a Lessor for all purposes of this Agreement, and has become a
party to this Agreement, as of the Effective Date, consents to the assignment of
the Lease under which Evanston is the Lessor to Barclay pursuant to this
Agreement, and is bound by all of the terms and conditions of this Agreement
applicable to the Lessors. Winston Hotels, Inc. hereby agrees to indemnify,
defend and hold harmless the MeriStar Indemnified Parties (as defined in Section
3(a) below) from and against any and all Obligations (as defined in Section 3(a)
below) that are incurred by any of the MeriStar Indemnified Parties as a result
of (i) the failure of Evanston to become a party to this Agreement as a Lessor
on the date hereof and (ii) the failure of Winston Hotels, Inc. to perform its
obligations under this Section 1(f).

                  (g) The parties executing and delivering this Agreement on the
date hereof acknowledge and agree that, notwithstanding the fact that Winston
SPE and Evanston have not executed and delivered this Agreement on the date
hereof, this Agreement is a binding and enforceable agreement with respect to
all parties who have executed and delivered the Agreement on the date hereof.

         2. Management Agreements. Barclay and the Manager are simultaneously
herewith entering into management agreements (the "New Management Agreements")
with respect to all of the Hotels, other than the Third Party Management
Agreements. The New Management Agreements will be substantially in the form
attached hereto as Exhibit C and will supersede and replace in all respects the
existing management agreements with respect to the Hotels (other than the Third
Party Management Agreements), which are listed on Exhibit D hereto. The
commencement date of the Management Agreements shall be the Effective Date,
which existing management agreements are hereby terminated as of the Effective
Date.

         3. Indemnification.

                  (a) Barclay and the Lessors (the "Winston Parties") hereby
jointly and severally agree to indemnify, defend and hold harmless CapStar,
Manager and their respective affiliates (the "MeriStar Indemnified Parties")
from and against:

                           (i) any and all costs, expenses, debts, liabilities,
         obligations, actions, causes of action, suits and claims relating to
         the Lease Agreements, the Leasehold Assets and/or the Hotels
         (collectively, "Obligations") that are incurred, or arise out of or
         relate to the occurrence of any act, action, omission, or event on or
         after the Effective Date (except to the extent Barclay is indemnified
         for such Obligations by Manager under the New Management Agreements or
         pursuant to CapStar's indemnity obligation under Section 3(b)(iii)
         hereof), or which are otherwise assumed by Barclay pursuant to Section
         1 hereof or credited to Barclay pursuant to the Estimated Settlement
         Statement or Actual Settlement Statement;

                           (ii) any and all Obligations that are incurred, or
         arise out of or relate to the occurrence of any act, action, omission,
         or event before the Effective Date and that meet one or more of the
         following conditions: (A) such Obligation results from the fraud

                                      -6-
<PAGE>

         of the Lessors, (B) such Obligation is asserted against any MeriStar
         Indemnified Party by a bona fide third party and is an Obligation
         against which Lessor indemnified CapStar under the applicable Lease
         Agreement; or (C) such Obligation is assumed by Barclay pursuant to
         Section 1 above or (to the extent of such credit) credited to Barclay
         pursuant to the Estimated Settlement Statement or Actual Settlement
         Statement;

                           (iii) mathematical calculation errors in the
         Estimated Settlement Statement or Actual Settlement Statement that
         adversely affect any MeriStar Indemnified Party;

                           (iv) any and all Obligations arising under the
         franchise agreements for the Hotels or the Third Party Management
         Agreements (A) which arise in connection with the transactions provided
         for in this Agreement (including without limitation (x) any default
         under any such agreement by a MeriStar Indemnified Party arising out of
         the performance of the transactions provided for in this Agreement, (y)
         any failure by any party to obtain consents required under such
         agreements in connection with the transactions set forth in this
         Agreement and/or (z) any failure by the Winston Parties to pay any and
         all transfer fees (whether such transfer fees were the obligation of
         any MeriStar Indemnified Party or any Winston Party (including without
         limitation affiliates of any Winston Party) under such agreements)
         arising under such agreements in connection with the transactions
         provided for in this Agreement), (B) which are the obligation of the
         Winston Parties, or with respect to which the Winston Parties have
         provided an indemnity, pursuant to Section 6(f) below, and/or (C) from
         and after the Effective Date (except to the extent that Barclay is
         indemnified by the Manager for such Obligations under the New
         Management Agreements); and

                           (v) any and all Obligations arising with respect to
         the transactions set forth in this Agreement under any of the terms of
         any agreement evidencing or securing any loan obligation of any Winston
         Party or affiliate thereof relating to the Lease Agreements, the
         Leasehold Assets or the Hotels, including without limitation any
         failure by any party to obtain any consents to the transactions set
         forth in this Agreement required under any such agreement (including
         without limitation any failure of a MeriStar Indemnified Party to
         comply with the provisions of any subordination agreement entered into
         by a MeriStar Indemnified Party and such lender which relate to the
         transactions set forth in this Agreement).

         The provisions of this Section 3(a) shall survive the Effective Date;
provided, however, that the provisions of Section 3(a)(iii) shall survive only
until February 28, 2003.

                  (b) CapStar and, by its signature below, MeriStar Hotels &
Resorts, Inc. ("MHR") hereby jointly and severally agrees to indemnify, defend
and hold harmless the Winston Parties and their respective affiliates (the
"Winston Indemnified Parties") from and against:

                           (i) any and all Obligations that are incurred, or
         arise out of or relate to the occurrence of any act, action, omission,
         or event before the Effective Date and that

                                      -7-
<PAGE>

         meet one or more of the following conditions: (A) such Obligation
         results from the fraud of CapStar, (B) such Obligation is asserted
         against any Winston Indemnified Party by any bona fide third party
         (including without limitation any employee or former employee of
         CapStar or Manager) and is an Obligation against which CapStar
         indemnified the applicable Lessor under the applicable Lease Agreement;
         or (C) such Obligation is retained by CapStar pursuant to Section 1
         hereof or is (to the extent of such credit) credited to CapStar
         pursuant to the Estimated Settlement Statement or Actual Settlement
         Statement;

                           (ii) mathematical calculation errors in the Estimated
         Settlement Statement or Actual Settlement Statement that adversely
         affect the Winston Parties; and

                           (iii) any and all Obligations arising in connection
         with the assumption and/or termination of any material Contract that
         was entered into by CapStar or the Manager and assumed by Barclay, but
         only if such Contract meets all of the following conditions: (A) such
         Contract is not listed on Schedule A hereto (a "Scheduled Contract"),
         (B) such Contract contains terms and conditions that are not similar to
         the terms and conditions of any Scheduled Contract, and (C) such
         Contract is not a contract which a reasonably prudent owner, lessee or
         operator of hotels similar to the Hotels would have entered into given
         such facts and circumstances as applied when such Contract was
         executed.

         The provisions of this Section 3(b) shall survive the Effective Date;
provided, however, that the provisions of Sections 3(a)(ii) and 3(a)(iii) shall
survive only until February 28, 2003.

        4. Consent and Releases. Winston and the Lessors hereby consent to
CapStar's assignment and transfer, and Barclay's assumption and acceptance, of
the Lease Agreements and the Leasehold Assets. Except for the indemnification
obligations provided for in Section 3 of this Agreement, the Winston Parties,
the Lessors and their respective affiliates, on the one hand, and CapStar and
its affiliates, on the other hand, hereby unconditionally release each other,
effective as of the Effective Date, of and from all obligations, liabilities,
and claims between the parties arising under the Lease Agreements with respect
to all periods prior to and/or from and after the Effective Date. The parties
agree that the foregoing release by the Winston Parties, the Lessors and their
respective affiliates of CapStar and its affiliates includes a release of any
claims relating to each Amendment to Management Agreement, executed by CapStar
and IMIC June 20, 2000, and effective July 1, 2000.

        5. Consideration. In consideration of and in exchange for the transfer
by CapStar of the Lease Agreements and the Leasehold Assets to Barclay pursuant
to Section 1 hereof and the other terms and conditions hereof, Barclay agrees to
make a cash payment to CapStar on the Closing Date by wire transfer of FIFTEEN
MILLION DOLLARS AND no/100s ($15,000,000.00) (the "Purchase Price"), plus
interest on $14,245,000 at an annual rate of 10% calculated from April 1 to June
30, 2002. In consideration of the agreement of the Manager to enter into the New
Management Agreements, Barclay agrees to make a cash payment to the Manager on
the Closing Date by wire transfer of TWO MILLION DOLLARS AND no/100s

                                      -8-
<PAGE>

($2,000,000) (the "Management Payment"), plus interest on the Management Payment
amount at an annual rate of 10% calculated from April 1 to June 30, 2002.

         6. Transition Rules. On or as of the date of this Agreement, the
following transition rules will apply with respect to the operation of each
Hotel:

                  (a) Preliminary and Estimated Settlement Statements. Using the
pro ration methodology set forth in Exhibit E hereto, Barclay and CapStar will,
by no later than July 31, 2002, agree on an estimated settlement statement (the
"Estimated Settlement Statement") that prorates the operating revenues and
expenses and working capital of each Hotel between the parties as of the Cut-Off
Time. Attached hereto as Exhibit E-1 is a preliminary settlement statement that
the parties have generated and agreed upon using the same pro ration methodology
set forth in Exhibit E, based on the operating revenues and expenses and working
capital of the Hotels as of March 31, 2002 (the "Preliminary Settlement
Statement"). In the event of any inconsistency between the methodology for the
pro rations set forth in Exhibit E and the methodology used to calculate the
Preliminary Settlement Statement, the methodology used to calculate the
Preliminary Settlement Statement shall govern. The parties agree that the net
payment owing from one party to the other on the Preliminary Settlement
Statement shall be credited to the appropriate party at the time the Purchase
Price and Management Fee are paid.

                  (b) Settlement Statement True-Up. The parties agree that any
net difference between the Preliminary Settlement Statement and the Estimated
Settlement Statement will be credited to the party benefiting from such net
difference and the other party will pay such amount to such benefiting party in
cash on July 31, 2002. On or before February 28, 2003, the parties hereto will
agree on an actual settlement statement (the "Actual Settlement Statement") with
respect to the Cut-Off Time using the same methodology used in the calculation
of the Preliminary Settlement Statement and the Estimated Settlement Statement,
except that such Actual Settlement Statement will be based on actual financial
information available at that time with respect to operating revenues and
expenses and working capital of each Hotel as of the Cut-Off Time. The parties
agree that any net difference between the Actual Settlement Statement and the
Estimated Settlement Statement will be credited to the party benefiting from
such net difference and the other party will pay such amount to such benefiting
party in cash on February 28, 2003. In no event, however, will the amount
payable by the Winston Parties, on the one hand, or CapStar and/or the Manager,
on the other hand, under this Section 6(b) exceed $250,000 (excluding
mathematical errors in calculation for which the parties have each indemnified
the other under Section 3 above).

                  (c) Leakage and Lease Payments.

                           (i) The parties agree that the Lessors or Barclay are
         entitled to receive, and the Preliminary Settlement Statement will
         reflect, a minimum of $400,000 in Leakage (as defined below) from the
         Hotels for the quarter ended on the Cut-Off Time payable by CapStar to
         the Lessors or Barclay. Leakage is defined as gross operating profit,
         as customarily defined in the hotel industry, less (A) a deemed
         management fee of 2% of gross income at the Hotels (excluding the
         Hotels managed by IMIC and Hilton), (B) management fees paid or payable
         under the applicable Third Party Management

                                      -9-
<PAGE>

         Agreements, (C) rent paid or payable to the Lessors under the Leases,
         and (D) certain taxes, insurance and other expenses customarily
         reflected on CapStar's income statement.

                           (ii) Capstar agrees to make the payments to the
         Lessors required under the Leases for the month ended June 30, 2002 on
         July 10, 2002, and for the quarter ended June 30, 2002, on July 15,
         2002.

                  (d) Intentionally Deleted.

                  (e) Employees. Because a CapStar affiliate, the Manager, will
continue to manage and operate each of the Hotels (other than the Third Party
Hotels), Barclay will not be responsible or liable for any employee severance
payments or costs, or any other employee-related costs and expenses arising out
of or resulting from the transactions provided for under this Agreement, except
to the extent such costs and expenses are caused by the actions of Barclay. Each
party agrees not to take any action that would cause a violation under the
Worker Adjustment Retraining and Notification Act.

                  (f) Franchise Agreements.

                           (i) The Winston Parties shall proceed promptly and in
         good faith to give all notices required under each existing franchise
         agreement with respect to the transactions contemplated hereby, and
         Barclay shall use its good faith reasonable efforts to obtain a new
         license agreement from the existing franchisor under each such
         franchise agreement, or to assume such existing franchise agreement
         from CapStar, in accordance with all applicable provisions of the
         applicable franchise agreements. In connection therewith, and subject
         to the terms and conditions set forth herein, CapStar shall exercise
         its good faith efforts, at no cost or expense to CapStar, to assist
         Barclay in obtaining an assignment of each such existing franchise
         agreement for each Hotel (or a termination of such existing franchise
         agreement and the obtaining of a replacement franchise agreement with
         the same brand) in favor of Barclay, including without limitation
         executing any customary termination agreements or assignment agreements
         reasonably required by the franchisors and reasonably agreed to by
         CapStar. CapStar shall have no obligation with respect to any property
         improvement plan or other work requirement imposed by any franchisor as
         a condition to the termination or assignment to Barclay of any existing
         franchise agreement.

                           (ii) If Barclay determines, in its sole discretion,
         that assignment or replacement of some or all of the franchise
         agreements is too costly, CapStar agrees to continue as the franchisee
         under such franchise agreements, in which event the Winston Parties
         will indemnify CapStar as provided in Section 3(a)(iv) above.
         Notwithstanding the foregoing or anything else to the contrary set
         forth in this Agreement, CapStar shall have no obligation to remain as
         franchisee under any franchise agreement with respect to any Hotel from
         and after the earlier to occur of (a) the termination of the New
         Management Agreement with respect to such Hotel by either party to such
         New Management Agreement, or (b) any default under such franchise
         agreement asserted by the franchisor thereunder which has not been
         cured in the time permitted by the

                                      -10-
<PAGE>

         franchisor, so long as such default was not caused by the failure of
         CapStar to operate the Hotels prior to the Effective Date in material
         compliance with its obligations under the Lease Agreements. In the
         event that CapStar elects to terminate or surrender any franchise
         agreement pursuant to the foregoing sentence, the Winston Parties shall
         be jointly and severally responsible for any and all damages
         (liquidated or otherwise), termination fees or other amounts imposed by
         the applicable franchisor in connection with such termination or
         surrender, and shall jointly and severally indemnify, defend and hold
         CapStar harmless from and against any and all costs, expenses, debts,
         liabilities, obligations, actions, causes of action, suits and claims
         relating to or in connection with such termination or surrender.

                           (iii) The Winston Parties jointly and severally agree
         to pay all change of ownership fees, inspection fees, termination fees,
         product improvement plan costs and/or other fees and costs imposed by
         the franchisors under the franchise licenses relating to the Hotels and
         incurred in connection with this Section 6(f) and all other fees and
         expenses imposed on CapStar, Manager or any of their respective
         affiliates by such franchisors under the franchise licenses relating to
         the Hotels in connection with any other matter undertaken by CapStar,
         Manager and their respective affiliates. In addition, the Winston
         Parties jointly and severally agree to reimburse CapStar and Manager
         for any reasonable out-of-pocket costs incurred by CapStar or Manager
         in connection with the assignment or replacement of the franchise
         agreements pursuant to this Section 6(f). Notwithstanding the
         foregoing, CapStar will be responsible for all franchise fees and other
         payments to the franchisors accruing under the franchise agreements
         through the Cut-Off Time, to the extent the same is the responsibility
         of CapStar under the Lease Agreements prior to the Effective Date,
         except as otherwise expressly provided in the Estimated Settlement
         Statement or Actual Settlement Statement.

                  (g) Contracts. All of the Contracts assumed by Barclay
pursuant to this Agreement (other than the Management Agreements) will be with
counterparties that are unaffiliated with CapStar or the Manager.

                  (h) Liquor License Transfer. CapStar or the Manager, as
applicable, will take such action, at the cost and expense of Barclay and to the
extent permitted by law, as may be necessary or appropriate to ensure that any
existing alcoholic beverage licenses held by CapStar, the Manager or their
agents in connection with their operation of the Hotels (the "Liquor Licenses")
remain in full force and effect and available for the benefit of the Hotels. If
and to the extent that any transfer or reissuance of any Liquor License is
required, CapStar or the Manager, as applicable, and Barclay shall each
cooperate with the other in effecting such transfer or reissuance. Without
limiting the generality of the foregoing, if CapStar and Barclay are unable to
obtain any necessary transfer or reissuance of any Liquor License prior to the
Effective Date with respect to a particular Hotel, then, as of the Effective
Date, CapStar or the Manager, as applicable, and Barclay shall, to the extent
permitted by law, enter into an interim agreement (the "Interim Agreement")
whereby CapStar will continue to operate the liquor concessions at the affected
Hotel on behalf of Barclay pending the transfer or reissuance of the Liquor
License. In that event, except to the extent provided under any New Management
Agreement, Barclay shall

                                      -11-
<PAGE>

indemnify, defend, and hold harmless CapStar from and against any and all
claims, liabilities, costs, and expenses (including, without limitation,
reasonable attorneys' fees and costs) arising in connection with such operation.

                  (i) Consents. Barclay shall be responsible for obtaining any
and all consents to the transactions set forth in this Agreement required from
IMIC or Hilton under the Third Party Management Agreements. The Third Party
Management Agreement with Hilton shall be deemed to be a franchise agreement for
the purposes of Section 6(f) and Section 3(a) as well as a Third Party
Management Agreement.

                  (j) Guarantee. As of the Effective Date, Winston and the other
Winston Parties hereby unconditionally release the existing $20,000,000
Guarantee of Leases, dated as of November 17, 1997, provided by MeriStar
Hospitality Corporation (as successor-in-interest to CapStar Hotel Company) of
CapStar's obligations under the Lease Agreements, which Guarantee of Leases is
hereby terminated and of no further force or effect.

                  (k) Pre-Effective Date Reservations and Agreements. Barclay
and the Manager will honor the terms and rates of all room reservations, room
allocations, and banquet facility and service agreements relating to the Hotels
that are confirmed or entered into by CapStar in the ordinary and normal course
of business prior to the Effective Date and that are to be honored or performed
on or subsequent to the Effective Date.

                  (l) Guest Property. All baggage and other property belonging
to guests of a Hotel ("Guest Property") that is in the care, possession, or
control (including, without limitation, checked baggage and property left in
safe deposit boxes) of CapStar on the day prior to the Date of this Agreement
shall continue in the care, possession, or control of CapStar or shall be
transitioned to the Manager, IMIC, or Hilton, as appropriate. CapStar shall be
responsible for, and shall indemnify and hold Barclay and its affiliates
harmless from and against any claim for, Guest Property placed in the care,
possession, or control of CapStar, the Manager, or any of their affiliates
before the Date of this Agreement.

                  (m) Holiday Inn Select, Dallas, Texas and Linen Inventory. The
parties hereby agree to cooperate with each other in good faith in order to
determine by no later than July 31, 2002, the cost to correct all damages caused
by Manager's failure to maintain thirty (30) rooms in the Holiday Inn Select,
Dallas, Texas Hotel in rentable condition consistent with the condition of other
rentable rooms at such Hotel, as distinguished from damages resulting from any
failure on the part of the Lessor of such Hotel to provide sufficient funds for
required capital expenditures in such rooms at such Hotel. In addition, by no
later than July 31, 2002, the parties will undertake a complete inventory of the
linens at all Hotels as of the date of this Agreement, in order to determine
whether the weighted average of the linen inventory at the Hotels, based on the
number of rooms at the Hotels, is at least 2.25 linen turns as of the date of
this Agreement. CapStar and Manager jointly and severally agree to reimburse the
Lessors, in a cash payment on July 31, 2002, the aggregate amount of such
damages caused by Manager and any linen shortfall at the Hotels below a weighted
average, based on the number of rooms at the Hotels, of 2.25 turns as of the
date of this Agreement, subject to an aggregate cap of $150,000 on CapStar's and
Manager's payment obligations under this Section 6(k).

                                      -12-
<PAGE>

         7. Representations and Warranties of CapStar. CapStar hereby make the
following representations and warranties to Barclay:

                  (a) Due Organization. CapStar is duly organized, validly
existing and in good standing under the laws of the State of its organization
and is duly qualified and in good standing to conduct business as a foreign
limited liability company in each jurisdiction where it is required to be so
qualified, except where the failure to be so qualified would not have a material
adverse effect on the business, operations or condition (financial or otherwise)
of CapStar and its affiliates, taken as a whole, or the enforceability of this
Agreement..

                  (b) Due Execution. The execution, delivery and performance of
this Agreement and the consummation of the transactions contemplated herein by
CapStar has been duly authorized by all necessary corporate action. The
Agreement constitutes a valid and binding agreement of CapStar, enforceable in
accordance with its terms.

                  (c) No Conflicts. The execution and delivery of this Agreement
by CapStar and the consummation by CapStar of the transactions contemplated
hereby will not, (A) violate any judgment, order, injunction, decree, regulation
or ruling of any court or governmental entity or (B) conflict with, result in a
breach of, or constitute a default under the certificate of formation or
operating agreement of CapStar, any note or other evidence of indebtedness, any
mortgage, deed of trust or indenture, or any lease or other material agreement
or instrument to which CapStar or any of its affiliates is a party or by which
CapStar or any of its affiliates may be bound.

                  (d) Litigation. There are no legal actions, suits or similar
proceedings pending and served, or, to CapStar's knowledge, threatened against
CapStar or the Hotels which if adversely determined would adversely affect
CapStar's ability to consummate the transactions contemplated hereby.

                  (e) Bankruptcy. CapStar has not (A) commenced a voluntary
case, or had entered against it a petition, for relief under any federal
bankruptcy act or similar petition, order or decree under any federal or state
law or statute relative to bankruptcy, insolvency or other relief for debtors,
(B) caused, suffered or consented to the appointment of a receiver, trustee,
administrator, conservator, liquidator or similar official in any federal, state
or foreign judicial or non-judicial proceedings, to hold, administer and/or
liquidate all or substantially all of its property, or (C) made an assignment
for the benefit of creditors as an alternative to commencing a petition of
bankruptcy.

         8. Representations and Warranties Regarding the Winston Parties. The
Winston Parties jointly and severally hereby make the following representations
and warranties to CapStar and Manager:

                  (a) Due Organization. Each of the Winston Parties is duly
organized, validly existing and in good standing under the laws of the State of
its respective organization and is duly qualified and in good standing to
conduct business as a foreign limited liability company, corporation or limited
partnership in each state in which it is required to be so qualified, except

                                      -13-
<PAGE>

where the failure to be so qualified would not have a material adverse effect on
the business, operations or condition (financial or otherwise) of the Winston
Parties, taken as a whole, or the enforceability of this Agreement.

                  (b) Due Execution. The execution, delivery and performance of
this Agreement and the consummation of the transactions contemplated herein by
the Winston Parties has been duly authorized by all necessary corporate action.
The Agreement constitutes a valid and binding agreement of each of the Winston
Parties, enforceable in accordance with its terms.

                  (c) No Conflicts. The execution and delivery of this Agreement
by each of the Winston Parties and the consummation by each of the Winston
Parties of the transactions contemplated hereby will not, (A) violate any
judgment, order, injunction, decree, regulation or ruling of any court or
governmental entity or (B) conflict with, result in a breach of, or constitute a
default under the certificate of formation or operating agreement, articles of
incorporation or partnership, as applicable, of each of the Winston Parties, any
note or other evidence of indebtedness, any mortgage, deed of trust or
indenture, or any lease or other material agreement or instrument to which any
Winston Party or any of its affiliates is a party or by which any Winston party
or any of its affiliates may be bound.

                  (d) Litigation. There are no legal actions, suits or similar
proceedings pending and served, or, to the Winston Parties' knowledge,
threatened against any Winston Party or the Hotels which if adversely determined
would adversely affect the Winston Parties' ability to consummate the
transactions contemplated hereby.

                  (e) Bankruptcy. No Winston Party has (A) commenced a voluntary
case, or had entered against it a petition, for relief under any federal
bankruptcy act or similar petition, order or decree under any federal or state
law or statute relative to bankruptcy, insolvency or other relief for debtors,
(B) caused, suffered or consented to the appointment of a receiver, trustee,
administrator, conservator, liquidator or similar official in any federal, state
or foreign judicial or non-judicial proceedings, to hold, administer and/or
liquidate all or substantially all of its property, or (C) made an assignment
for the benefit of creditors as an alternative to commencing a petition of
bankruptcy.

         9. Transfer Taxes. To the extent that any state or local taxes are
imposed on the transfer of the Leasehold Assets hereunder, Barclay shall bear
the expense of such taxes.

         10. Public Announcements; Confidentiality.

                  (a) Public Announcements. Neither party nor any of its
affiliates shall issue or make any reports, statements or releases to the public
or generally to its employees, customers, suppliers or other persons with
respect to this Agreement or the transactions contemplated hereby without giving
the other three (3) business days to comment on such report, statement or
release.

                  (b) Confidentiality. Each party hereto shall keep
confidential, and shall cause

                                      -14-
<PAGE>

its directors, officers, employees, agents, representatives and advisors to keep
confidential, any information from time to time received by it from any other
party regarding such other party or its business affairs with respect to Hotels
and/or the transactions contemplated under this Agreement; provided, however,
that nothing herein shall restrict the disclosure of any such information to the
extent required by statute, rule (including New York Stock Exchange rules and
the rules and regulations of the Securities and Exchange Commission), regulation
or judicial process, to its professional advisors and agents, to lenders or
prospective lenders, to investors or prospective investors, to any third party
with whom a party enters into discussions regarding a merger, a sale of all or
substantially all of such party's assets or capital stock, or another type of
business combination transaction (provided such party agrees to be bound by a
customary confidentiality agreement with respect to such information), or the
disclosure of any such information which is generally available to the public,
or in connection with litigation.

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

        12. Notices. Any notice required or permitted to be given hereunder
shall be in writing and shall be deemed to be delivered when delivered by hand
or sent by registered or certified mail (return receipt requested and postage
prepaid) or by reputable overnight courier service and addressed as follows:

                  (a) If to CapStar, Manager, MeriStar Hospitality Corporation
                      or MHR, to:

                      c/o MeriStar Hotels & Resorts, Inc.
                      1010 Wisconsin Ave., N.W.
                      Washington, D.C. 20007
                      Attention: General Counsel
                      Tel: (202) 295-2316
                      Fax: (202) 295-1026

                  (b) If to any of the Winston Parties, to:

                      c/o Winston Hotels, Inc.
                      2626 Glenwood Avenue, Suite 200
                      Raleigh, NC 27608
                      Attention: Mr. Joseph V. Green
                      Tel: (919) 510-6017
                      Fax: (919) 510-6016

         13. Successors. This Agreement shall be binding upon and shall inure to
the benefit of the parties hereto and their respective subsidiaries, affiliates,
successors, and assigns.

         14. Entire Agreement; Amendment. This Agreement constitutes the entire
agreement of the parties with respect to the subject matter hereof and
supersedes all prior agreements and understandings among the parties with
respect to the matters set forth herein. No amendment or

                                      -15-

<PAGE>

modification of this Agreement, or of any of the provisions hereof, shall be
binding upon any party unless made in writing and signed by both CapStar and
Barclay.

         15. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of North Carolina, without regard to its
conflicts of laws provisions.

                     [SIGNATURES APPEAR ON FOLLOWING PAGES]

                                      -16-

<PAGE>

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

                                   BARCLAY HOSPITALITY SERVICES INC.

                                   By:    /s/ Joseph V. Green
                                      -----------------------------------------
                                   Name:  Joseph V. Green
                                        ---------------------------------------
                                   Title: Executive Vice President
                                         --------------------------------------

                                   CAPSTAR WINSTON COMPANY, LLC

                                   By:    /s/ Chris Bennett
                                      -----------------------------------------
                                   Name:  Chris Bennett
                                        ---------------------------------------
                                   Title:
                                         --------------------------------------

                                   MERISTAR MANAGEMENT COMPANY, LLC
                                   By:  MeriStar H & R Operating Company, L.P.,
                                        member
                                        By:  MeriStar Hotels & Resorts. Inc.,
                                             general partner

                                        By:    /s/ Chris Bennett
                                           ------------------------------------
                                        Name:  Chris Bennett
                                             ----------------------------------
                                        Title:
                                              ---------------------------------

                                   MERISTAR HOTELS & RESORTS, INC.
                                   (for purposes of Section 3(b) only)

                                   By:    /s/ Chris Bennett
                                      -----------------------------------------
                                   Name:  Chris Bennett
                                        ---------------------------------------
                                   Title:
                                         --------------------------------------

                                   WINN LIMITED PARTNERSHIP, L.P.
                                   By: Winston Hotels, Inc., its general partner

                                   By:    /s/ Joseph V. Green
                                      -----------------------------------------
                                   Name:  Joseph V. Green
                                        ---------------------------------------
                                   Title: Executive Vice President
                                         --------------------------------------

                                   WINSTON HOTELS, INC.

                                   By:    /s/ Joseph V. Green
                                      -----------------------------------------
                                   Name:  Joseph V. Green
                                        ---------------------------------------
                                   Title: Executive Vice President
                                         --------------------------------------

<PAGE>

                                   EVANSTON HOTEL ASSOCIATES, LLC
                                   By: Regent Hotel Development II, LLC, its
                                       managing member
                                   By: Regent Partners, Inc., its sole member

                                       By:
                                          --------------------------------------
                                       Name:
                                       Title:

                                   MARSH LANDING ASSOCIATES, LLC
                                   By: Marsh Landing Investment, L.L.C., its
                                       managing member

                                       By:    /s/ Charles M. Winston
                                          --------------------------------------
                                       Name:  Charles M. Winston
                                       Title: Managing Member

<PAGE>

                                    EXHIBIT A

                                     HOTELS

--------------------------------------------------------------------------------
   NO.      HOTEL NAME                             ROOMS       MGMT       STATE
--------------------------------------------------------------------------------
   1    Comfort Inn Augusta                         123      Meristar       GA
   2    Comfort Inn Fayetteville                    176      Meristar       NC
   3    Comfort Inn Greenville                      190      Meristar       SC
   4    Comfort Inn Wilmington                      146      Meristar       NC
   5    Comfort Suites Orlando                      215      Meristar       FL
   6    Courtyard by Marriott Ann Arbor             160      Meristar       MI
   7    Courtyard by Marriott Houston               198      Meristar       TX
   8    Courtyard by Marriott Wilmington            128      Meristar       NC
   9    Courtyard by Marriott Winston Salem         122      Meristar       NC
   10   Fairfield Inn Ann Arbor                     110      Meristar       MI
   11   Hampton Inn & Suites Gwinnett               136      Meristar       GA
   12   Hampton Inn Boone                            95      Meristar       NC
   13   Hampton Inn Brunswick                       127      Meristar       GA
   14   Hampton Inn Cary                            130      Meristar       NC
   15   Hampton Inn Charlotte                       125      Meristar       NC
   16   Hampton Inn Durham                          137      Meristar       NC
   17   Hampton Inn Jacksonville                    120      Meristar       NC
   18   Hampton Inn Perimeter                       131      Meristar       GA
   19   Hampton Inn Ponte Vedra                     118      Meristar       FL
   20   Hampton Inn Southern Pines                  126      Meristar       NC
   21   Hampton Inn Southlake                       124      Meristar       GA
   22   Hampton Inn West Springfield                126      Meristar       MA
   23   Hampton Inn White Plains                    156      Meristar       NY
   24   Hampton Inn Wilmington                      118      Meristar       NC
   25   Hilton Garden Inn Albany Airport            155      Meristar       NY
   26   Hilton Garden Inn at RDU                    155      Meristar       NC
   27   Hilton Garden Inn Atlanta Winward           164      Meristar       GA
   28   Hilton Garden Inn Evanston                  178      Meristar       IL
   29   Holiday Inn at Tinton Falls                 171      Meristar       NJ
   30   Holiday Inn Express Abingdon                 81      Meristar       VA
   31   Holiday Inn Express Clearwater              127      Meristar       FL
   32   Holiday Inn Select Garland                  243      Meristar       TX
   33   Homewood Suites Alpharetta                  112      Meristar       GA
   34   Homewood Suites Cary                        120      Meristar       NC
   35   Homewood Suites Durham                       96      Meristar       NC
   36   Homewood Suites Lake Mary                   112      Meristar       FL
   37   Homewood Suites Phoenix                     126      Meristar       AZ
   38   Homewood Suites Raleigh                     137      Meristar       NC
   39   Residence Inn Phoenix                       168      Meristar       AZ
   40   Comfort Inn Charleston                      128        IMIC         SC
   41   Quality Suites Charleston                   168        IMIC         SC
   42   Comfort Inn Chester                         123        IMIC         VA
   43   Hampton Inn Chester                          66        IMIC         VA
   44   Comfort Inn Durham                          138        IMIC         NC
   45   Hampton Inn Hilton Head                     125        IMIC         SC
   46   Hampton Inn Raleigh                         141        IMIC         NC
   47   Homewood Suites Clearlake                    92       Hilton        TX

<PAGE>

                                    EXHIBIT B

                                EXCLUDED PROPERTY

<PAGE>

                                    EXHIBIT C

                        FORM OF NEW MANAGEMENT AGREEMENT

<PAGE>

                                    EXHIBIT D

                        SCHEDULE OF MANAGEMENT AGREEMENTS

MASTER MANAGEMENT AGREEMENT, DATED AS OF AUGUST 3, 1998, AS AMENDED, BY AND
BETWEEN CAPSTAR WINSTON COMPANY, LLC AND MERISTAR MANAGEMENT COMPANY, LLC.

<PAGE>

                                    EXHIBIT E

                PRO RATION METHODOLOGY FOR OPERATIONAL SETTLEMENT

         On or before the Closing Date, CapStar and Barclay shall prepare, or
cause to be prepared, a balance sheet as of the Effective Date pursuant to which
CapStar will be credited for all assets and Barclay will be credited for all
liabilities. Specifically:

         1. Final Night's Room Revenue. The final night's room revenue (the
night immediately preceding the Effective Date) and applicable occupancy taxes
(revenue from rooms occupied on the night immediately preceding the Effective
Date), including telephone and similar charges, shall be credited to CapStar.

         2. Advance Deposits. Any advance deposits or payments made to CapStar
on confirmed reservations for dates on or after the Effective Date will be
credited and transferred to Barclay.

         3. Licensing and Permit Fees. Amounts paid or payable as fees for the
year or other fiscal period during which the Effective Date occurs for
governmental licenses and permits which are assigned by CapStar to Barclay shall
be prorated on a daily basis (but any amounts refundable under any permit or
license which is not assigned shall remain the property of CapStar).

         4. Contracts. All payments and receipts under any of the Contracts
assumed by Barclay which cover a period subsequent to the Effective Date shall
be prorated on a daily basis through the Cut-Off Time, and any security deposits
held by CapStar with respect to any such Contract shall be charged and
transferred to Barclay at the Effective Date (subject to the terms and
conditions of the Contract pursuant to which such deposit is held) and CapStar
shall be given a credit at the Effective Date for any security deposit held by a
third party pursuant to any such Contract assigned to Barclay at the Effective
Date.

         5. Deposits. Except for utility and telephone deposits of CapStar for
which CapStar will either be reimbursed or receive a credit, all prepayments for
yellow page advertising and other deposits or similar payments made by CapStar
for periods subsequent to the Effective Date will be prorated on a daily basis.

         6. Utility and Telephone Charges. All utility and telephone charges
will be prorated on a daily basis for periods up to and including the Effective
Date, and all accounts therefor will be terminated as to CapStar and established
as to Barclay as of the Effective Date, and in connection therewith CapStar
agrees to fill out the customary forms required by the telephone company to
assign the existing phone numbers to Barclay. Final readings and final billings
for utilities (including telephone) will be made, if possible, as of the Cutoff
Time, in which event no proration will be made with respect to utility bills.
CapStar will be entitled to all deposits made by CapStar and presently in effect
with utility providers if such deposits are in the name of CapStar, and Barclay
will be obligated to make its own arrangements for deposits with the utility
providers. To the extent that utility bills cannot be rendered as of the
Effective Date, such

<PAGE>

charges for the period through the Cut-Off Time shall be prorated as of the
Cut-Off Time based upon the most recent available bills and readjusted on the
basis of the actual bills as and when received.

         7. Vending Machines. CapStar's only right with respect to any vending
machines within a Hotel is to receive commissions on sales therefrom, and such
vending machines may be emptied and receipts therefrom recorded by the owner
thereof, it being understood that CapStar is entitled to receive from the owner
thereof all commissions with respect thereto which are unpaid as of the
Effective Date. Barclay shall be entitled to all commissions thereon from and
after the Effective Date.

         8. Accounts Receivable. Notwithstanding anything to the contrary
contained herein, the Estimated Settlement Statement and Actual Settlement
Statement shall reflect as a credit to CapStar an amount equal to all guest
ledger accounts receivable at the Hotels less the allowance for doubtful
accounts balance as of the Effective Date.

         9. Accounts Payable. Notwithstanding anything to the contrary contained
herein, the Estimated Settlement Statement and Actual Settlement Statement shall
reflect as a credit to Barclay an amount equal to all accounts payable and
accrued liabilities as of the Effective Date with respect to goods and services
delivered to a Hotel prior to the Effective Date.

         10. Impositions. Notwithstanding anything to the contrary contained
herein, the Estimated Settlement Statement and Actual Settlement Statement shall
reflect as a credit to Barclay an amount equal to all Impositions (other than
Impositions that are the Lessors' responsibility under the Lease Agreements), if
any, payable or accrued with respect to all of the Hotels as of the Effective
Date.

         11. Subleases. All rentals under any subleases (including fixed rents
and charges in respect of electricity, operating expenses and taxes) shall be
prorated as of the Cut-Off Time if, as and when collected. Barclay shall receive
a credit for the prorated amounts (as of the Cutoff Time) of all rents and other
payments under any subleases at the Hotels previously paid to or collected by
CapStar and attributable to any period following the Cutoff Time. After the
Cutoff Time, CapStar will cause to be paid or turned over to Barclay all rents
and other payments under the subleases, if any, received by CapStar and
attributable to the period after the Cutoff Time. Delinquent rents will not be
prorated. Barclay agrees to use good faith collection procedures with respect to
the collection of any delinquent rents but Barclay shall have no liability for
the failure to collect any such amounts and will not be required to conduct
lock-outs or take any other legal action to enforce collection of any such
amounts owed to CapStar from any sub-lessee. To the extent any sum collected by
Barclay from a sublessee from and after the Cut-Off Time indicates to what
invoice or period such sum is to be applied, such sum will be applied to such
invoice or period. All other sums collected by CapStar from and after the
Effective Date from each sub-lessee will be applied first to current amounts
owed by such sub-lessee, and then, to prior delinquencies owed by such
sub-lessee to CapStar.

         12. Franchise Fees. CapStar shall be responsible for the payment of all
franchise and other fees, if any, under the Franchise Agreements with respect to
the period up to the Cutoff

<PAGE>

Time, to the extent the same were the responsibility of CapStar under the Lease
Agreements, and Barclay shall be responsible for the payment of all franchise
and other fees, if any, under the Franchise Agreements with respect to the
period after the Cutoff Time.

         13. Employees. All wages and fringe benefits of Hotel employees shall
be prorated as of the Cut-Off Time.

         14. House Banks. All cash on hand in house banks on the morning of the
Effective Date shall become the property of Barclay and the amount thereof shall
be credited to CapStar.

                  Any reference to proration on a "daily basis" means that
CapStar shall receive a credit for any expenditures made by CapStar which are to
be prorated hereunder calculated by multiplying such expenditure by a fraction
the numerator of which is the number of days within the period for which the
payment was made beginning on the Effective Date and the denominator of which is
the number of days within the period for which such payment was made; and
Barclay shall receive a credit for expenditures made or to be made by Barclay
which are to be prorated hereunder, calculated by multiplying such expenditure
by a fraction the numerator of which is the number of days within the period
prior to the Effective Date, and the denominator of which is the number of days
within the period for which such payment was made.

<PAGE>

                                   EXHIBIT E-1

                        PRELIMINARY SETTLEMENT STATEMENT

<PAGE>

                                   SCHEDULE A

                               SCHEDULED CONTRACTS

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00041-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00041-of-00352.parquet"}]]