Document:

Exhibit 10.2

 

DIRECTOR NOMINATION AGREEMENT

 

BY AND AMONG

 

SUMMIT HOTEL PROPERTIES, INC.,

 

BRIGHT FORCE INVESTMENT, LLC,

 

SAGESTAR FAMILY, LLC

 

AND

 

C&D FAMILY HOLDINGS, LLC

 

Dated as of January 13, 2022

 

     

     

    

 

	Table of Contents	 	 	 
	 	 	 	 
	 	 	 	Page	 
	 	 	 	 	 
	ARTICLE I - DEFINED TERMS	 	 	1	 
	 	 	 	 	 
	Section 1.1 Defined Terms	 	 	1	 
	 	 	 	 	 
	ARTICLE II - DIRECTOR NOMINATION RIGHT	 	 	2	 
	 	 	 	 	 
	Section 2.1 Director Nomination Right	 	 	2	 
	Section 2.2 Director Qualifications	 	 	3	 
	Section 2.3 Replacement	 	 	4	 
	 	 	 	 	 
	ARTICLE III - GENERAL PROVISIONS	 	 	4	 
	 	 	 	 	 
	Section 3.1 Termination	 	 	4	 
	Section 3.2 Notices	 	 	5	 
	Section 3.3 Amendment;
Waiver	 	 	5	 
	Section 3.4 Successors
and Assigns	 	 	6	 
	Section 3.5 Third
Parties	 	 	6	 
	Section 3.6 Governing
Law	 	 	6	 
	Section 3.7 Waiver of Trial by Jury	 	 	6	 
	Section 3.8 Entire
Agreement	 	 	6	 
	Section 3.9 Severability	 	 	6	 
	Section 3.10 Table
of Contents, Headings and Captions	 	 	7	 
	Section 3.11 Counterparts	 	 	7	 

 

    i

     

    

 

This DIRECTOR NOMINATION AGREEMENT (as the same
may be amended, modified or supplemented from time to time, this “Agreement”), dated as of January 13, 2022, is
entered into by and among Summit Hotel Properties, Inc., a Maryland corporation (the “Company”), on the one hand,
and Bright Force Investment, LLC, a Texas limited liability company, Sagestar Family, LLC, a Texas limited liability company, and C & D
Family Holdings, LLC, a Texas limited liability company (collectively, together with any permitted assignees pursuant to Section 3.4,
 “Contributor”) on the other.

 

WHEREAS,
Affiliates of Contributor have entered into that certain Contribution and Purchase Agreement dated as of November 2, 2021, by and
among Summit Hotel OP, LP, a Delaware limited partnership (the “Operating Partnership”), Summit Hospitality
JV, LP, a Delaware limited partnership, NewcrestImage Holdings, LLC, a Delaware limited liability company, and NewcrestImage Holdings
II, LLC, a Delaware limited liability company (the “Contribution Agreement”), pursuant to which the Operating Partnership
will acquire, directly or indirectly, certain hotel properties and other assets held, directly or indirectly, by Contributor (the “Contribution”);

 

WHEREAS, in consideration for the Contribution,
Contributor or its Affiliates will receive a combination of cash, preferred units of limited partnership interest in the Operating Partnership
and common units of limited partnership interest in the Operating Partnership (“Common Units”), which Common Units
are redeemable for either cash or, at the option of the Operating Partnership, shares of common stock, $0.01 par value per share, of the
Company (“Common Shares”); and

 

WHEREAS, on and following the date of closing
of the Contribution (the “Closing Date”), Contributor and the Company wish to provide for certain director nomination
and other rights.

 

NOW, THEREFORE, in consideration of the mutual
covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties to this Agreement hereby agree as follows:

 

ARTICLE I
- DEFINED TERMS

 

Section 1.1
Defined Terms.

 

The following definitions shall be for all purposes,
unless otherwise clearly indicated to the contrary, applied to the terms used in this Agreement.

 

“Affiliate” shall mean: (i) any
Person that, directly or indirectly, controls or is controlled by or is under common control with such Person, (ii) any other Person
that owns, beneficially, directly or indirectly, 10% or more of the outstanding capital stock, shares or equity interests of such Person,
or (iii) any officer, director, employee, partner, member, manager or trustee of such Person or any Person controlling, controlled
by or under common control with such Person. For the purposes of this definition, “control” (including the correlative meanings
of the terms “controlled by” and “under common control with”), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, through
the ownership of voting securities or partnership interests, contract or otherwise.

 

     

     

    

 

“Agreement” shall have the
meaning set forth in the preamble of this Agreement.

 

“Board” shall mean the board
of directors of the Company.

 

“Closing Date” shall have the
meaning set forth in the recitals of this Agreement.

 

“Common Shares” shall have
the meaning set forth in the recitals of this Agreement.

 

“Common Units” shall have the
meaning set forth in the recitals of this Agreement.

 

“Company” shall have the meaning
set forth in the preamble of this Agreement.

 

“Contribution” shall have the
meaning set forth in the recitals of this Agreement.

 

“Contribution Agreement” shall
have the meaning set forth in the recitals of this Agreement.

 

“Contributor” shall have the
meaning set forth in the preamble of this Agreement.

 

“Contributor
Designee” shall mean: (i) initially, the following individual who shall be appointed as a Director effective upon
the completion of the Contribution: Mehul Patel, and (ii) thereafter, at any time, a single individual designated by Contributor
pursuant to the terms of this Agreement for appointment to the Board or nomination to be elected to the Board at the next meeting of the
stockholders of the Company at which all Directors are to be elected, as applicable.

 

“Designation Notice” shall
have the meaning set forth in Section 2.1(b).

 

“Director” shall mean each
member of the Board.

 

“Director Nomination Right”
shall have the meaning set forth in Section 2.1(a).

 

“Exchange Act” shall mean the
Securities Exchange Act of 1934, as amended.

 

“Operating Partnership” shall
have the meaning set forth in the recitals of this Agreement.

 

“Person” means any individual,
partnership, corporation, limited liability company, joint venture, trust or other entity.

 

ARTICLE II
- DIRECTOR NOMINATION RIGHT

 

Section 2.1
Director Nomination Right.

 

(a) Subject and pursuant to the terms of
this Agreement, for so long the total number of Common Shares and Common Units owned of record by Contributor or its Affiliates is equal
to at least ten percent (10%) of the sum of (X) the number of Common Shares outstanding plus (Y) the number of Common Units
outstanding that are not owned directly or indirectly by the Company, Contributor shall have the right, but not the obligation, to designate
one individual as a nominee for election to the Board at each annual meeting of the stockholders of the Company (or special meeting of
the stockholders in lieu of an annual meeting at which Directors are to be elected) (the “Director Nomination Right”).
Contributor shall provide such certifications regarding the beneficial ownership of shares of Common Stock and Common Units by Contributor
and its Affiliates as the Company may reasonably request from time to time in order to determine Contributor’s eligibility to exercise
the Director Nomination Right.

 

    2

     

    

 

(b) For
each meeting of the stockholders of the Company at which Directors are to be elected prior to the termination of this Agreement in accordance
with Section 3.1, if Contributor desires to exercise the Director Nomination Right, Contributor shall submit in writing to
the Company the name of the Contributor Designee (a “Designation Notice”) at least 120 days prior to the first anniversary
of the date on which the proxy statement for the preceding year’s annual meeting of stockholders of the Company was filed with the
United States Securities and Exchange Commission; provided, however, that with respect to the 2022 annual meeting, a special meeting
in lieu of an annual meeting at which all Directors are to be elected or in the event that the date of the annual meeting of the stockholders
of the Company is advanced or delayed by more than 30 days from the first anniversary of the date of the preceding year’s annual
meeting of stockholders of the Company, the Designation Notice to be timely must be so submitted not later than the later of the 120th
day prior to the date of such meeting or the tenth day following the day on which public announcement or notice to Contributor of the
date of such meeting is first made. In the event Contributor has neither provided the Designation Notice within the time period set forth
above for a meeting nor provided notice to the Company that Contributor will not exercise the Director Nomination Right, Contributor will
be deemed to have designated the Contributor Designee currently serving on the Board for reelection at such meeting.

 

(c) For
each meeting of the stockholders of the Company at which Directors are to be elected prior to the termination of this Agreement in accordance
with Section 3.1, the Nominating and Corporate Governance Committee of the Board and the Board shall cause the Contributor
Designee to be a nominee for election at such meeting, and shall include the Contributor Designee in the Company’s proxy statement
for such meeting in a manner consistent with its solicitation of proxies for the election of all other Director candidates nominated by
the Board and recommend that the stockholders of the Company elect to the Board the Contributor Designee. Subject to applicable legal
or stock exchange listing requirements, neither the Board nor the Company shall take any action to oppose the election of the Contributor
Designee.

 

(d) Notwithstanding
anything to the contrary herein, and for clarity, the parties agree that in no event shall Contributor have the right to designate more
than one Contributor Designee and at no time will more than one Contributor Designee serve as a Director.

 

Section 2.2
Director Qualifications.

 

(a) No
individual may be designated by Contributor for nomination or appointment to the Board at any time: (i) if, within ten years of such
time, any of the events described in Items 401(f)(1)-(8) of Regulation S-K under the Exchange Act of 1934, as amended (or any successor
regulation) occurred, unless the Company, in its sole discretion, concludes that disclosure of such event would not be required, (ii) if
such individual would be prohibited by applicable law from serving as a Director or (iii) if a majority of the members of the Board,
other than the Contributor Designee, determines, in good faith, that such individual has violated a written policy of the Company applicable
to such individual or does not meet the needs of the Board as determined during the Board’s regular evaluation of the suitability
of individuals for Board membership (in which case Contributor will have 30 days to designate a replacement Contributor Designee pursuant
to a Designation Notice delivered in accordance with Section 2.1(b)).

 

    3

     

    

 

(b) Contributor shall use reasonable efforts
to ensure that any Contributor Designee satisfies all stated criteria and guidelines for director nominees of the Company.

 

(c) Any
Contributor Designee shall be required, as a condition to such individual’s nomination, appointment and service as a Director, to
make such acknowledgements, enter into such agreements and provide such information as the Board requires of all Directors at such time,
including without limitation, completing such questionnaires as the Company requires of all Directors or nominees and agreeing to be bound
by the Company’s policies by which every Director is bound, including, but not limited to, the Code of Business Conduct and Ethics,
the Insider Trading Policy, the Policy on Conflicts of Interest Regarding Hotel Properties and the Policy on Voting Regarding Directors.
Any Contributor Designee shall also be required, as a condition to such individual’s nomination, appointment and service as a Director,
to submit an irrevocable conditional resignation to be effective upon the occurrence of a termination of this Agreement pursuant to Section 3.1
and the Board’s formal acceptance of such resignation following such termination. The Company also agrees that it will provide indemnification,
advancement of expenses, directors’ and officers’ liability insurance and compensation for service as a director to the Contributor
Designee who is a Director on the same basis, and in the same manner, as it does for all other non-employee Directors.

 

Section 2.3
Replacement.

 

In the event that a vacancy is created at any
time by the death or disability, or resignation or removal from the Board, of a Contributor Designee then serving as a Director, Contributor
shall have the right, but not the obligation, to designate a new Contributor Designee to fill the remaining term of the prior Contributor
Designee, and, in such a case, the Company hereby agrees to take all reasonable actions necessary to cause the appointment of such replacement
Contributor Designee.

 

ARTICLE III
- GENERAL PROVISIONS

 

Section 3.1
Termination.

 

This
Agreement shall automatically terminate at such time as (i) Contributor is no longer eligible to exercise the Director Nomination
Right pursuant to Section 2.1(a), (ii) Contributor notifies the Company in writing that it will not exercise the Director
Nomination Right or (iii) the Company enters into a merger, consolidation or other similar transaction following which a majority
of the members of the board of directors of the resulting company were not members of the Board immediately prior to such transaction.
Upon such termination, no party shall have any further rights, obligations or liabilities hereunder; provided that such termination
shall not relieve any party from liability for any breach of this Agreement prior to such termination.

 

    4

     

    

 

Section 3.2
Notices.

 

(a) Any
notice, demand, request or report required or permitted to be given or made hereunder shall be in writing and shall be deemed given or
made when delivered in person or when sent by nationally recognized overnight delivery service, facsimile transmission (with facsimile
receipt confirmed) or email (with email receipt confirmed), to the following addresses (or any other address that any such party may designate
by written notice to the other parties):

 

(i) if to Contributor:

 

Mehul Patel

c/o NewcrestImage Holdings, LLC

1785 State Highway 26 – Suite 400

Grapevine, Texas 76051

Phone: (214) 774-4650

Email: Mehul.Patel@Newcrestimage.com

 

(ii) if to the Company:

 

Chris Eng, General Counsel

c/o Summit Hotel Properties, Inc.

13215 Bee Cave Parkway, Suite B-300

Austin, TX 78738

Phone: (512) 538-2307

Facsimile: (512) 538-2333

Email: ceng@shpreit.com

 

(b) Any
such notice shall, if delivered personally, be deemed received upon delivery; shall, if delivered by nationally recognized overnight delivery
service, be deemed received the first business day after being sent; and shall, if delivered by facsimile, be deemed received upon confirmation.

 

(c) Whenever
any notice is required to be given by law or this Agreement, a written waiver thereof, signed by the person entitled to notice, whether
before or after the time stated therein, shall be deemed equivalent to the giving of such notice.

 

(d) Contributor
agrees that any notice, demand, request or report required or permitted to be given or made hereunder by Contributor shall be given
or made solely by the Contributor Designee or, in the event of the Contributor Designee’s death or disability, or resignation or
removal from the Board, any other single individual who is authorized by Contributor to so act.

 

Section 3.3
Amendment; Waiver.

 

This Agreement may be amended, supplemented or
otherwise modified only by a written instrument executed by each of the parties hereto. No waiver by any party of any of the provisions
hereof will be effective unless explicitly set forth in writing and executed by the party so waiving. The waiver by any party hereto of
a breach of any provision of this Agreement will not operate or be construed as a waiver of any subsequent breach.

 

    5

     

    

 

Section 3.4
Successors and Assigns.

 

Except
as specifically provided herein, this Agreement may not be assigned by the Company without the express prior written consent of Contributor,
and any attempted assignment, without such consent, shall be null and void. Except as specifically provided herein, this Agreement may
not be assigned by Contributor without the express prior written consent of a majority of the members of the Board not affiliated with
Contributor or Contributor’s Affiliates, and any attempted assignment, without such consent, shall be null and void.

 

Section 3.5
Third Parties.

 

This Agreement does not create any rights, claims
or benefits inuring to any person or entity that is not a party hereto, including any Contributor Designee, nor create or establish any
third party beneficiary hereto.

 

Section 3.6
Governing Law.

 

This
Agreement shall be governed by and construed in accordance with, the laws of the State of Maryland, without regard to the choice of law
or conflict of law provisions thereof.

 

Section 3.7
Waiver of Trial by Jury.

 

EACH OF THE PARTIES HERETO HEREBY WAIVES TRIAL
BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING ANY DISPUTE, CONTROVERSY OR CLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT.

 

Section 3.8
Entire Agreement.

 

This
Agreement sets forth the entire understanding of the parties hereto with respect to the subject matter hereof. There are no agreements,
representations, warranties, covenants or understandings with respect to the subject matter hereof other than those expressly set forth
herein. This Agreement supersedes all other prior agreements and understandings between the parties with respect to such subject
matter.

 

Section 3.9
Severability.

 

If
any provision of this Agreement is held to be illegal, invalid or unenforceable under present or future laws effective during the term
of this Agreement, such provision shall be fully severable; this Agreement shall be construed and enforced as if such illegal,
invalid, or unenforceable provision had never comprised a part of this Agreement; and the remaining provisions of this Agreement shall
remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance from
this Agreement. Furthermore, in lieu of each such illegal, invalid or unenforceable provision, there shall be added automatically as a
part of this Agreement a provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and be legal,
valid and enforceable.

 

    6

     

    

 

Section 3.10
Table of Contents, Headings and Captions.

 

The
table of contents, headings, subheadings and captions contained in this Agreement are included for convenience of reference only, and
in no way define, limit or describe the scope of this Agreement or the intent of any provision hereof.

 

Section 3.11
Counterparts.

 

This
Agreement and any amendment hereto may be signed in any number of separate counterparts, each of which shall be deemed an original,
but all of which taken together shall constitute one agreement (or amendment, as applicable).

 

Section 3.12
Specific Performance.

 

Each party hereto acknowledges and agrees that
in the event of any breach of this Agreement by any of them, the Company (in the case of a breach by Contributor) or Contributor (in the
case of a breach by the Company) would be irreparably harmed and could not be made whole by monetary damages. Each party accordingly agrees
to waive the defense in any action for specific performance that a remedy at law would be adequate and that the Company and Contributor,
as the case may be, in addition to any other remedy to which they may be entitled at law or in equity, shall be entitled to specific performance
of this Agreement without the posting of bond.

 

[Remainder of page intentionally left blank]

 

    7

     

    

 

IN WITNESS WHEREOF, the parties hereto have caused
this Director Nomination Agreement to be duly executed as of the date first above written.

 

		SUMMIT HOTEL PROPERTIES, INC.,
		a Maryland corporation
	 	 
		By:	/s/ Christopher Eng
		     	Name:	Christopher R. Eng
		     	Title:	Executive Vice President, General Counsel and Chief Risk Officer

 

[Signatures continue on following page]

[Signature Page to Director Nomination Agreement]

 

    8

     

    

 

		CONTRIBUTOR:
	 	 
		BRIGHT FORCE INVESTMENT, LLC,
		a Texas limited liability company,
	 	 
		By:	NewcrestImage Holdings, LLC,
		 	a Delaware limited liability company, its Member
	 	 	 	 
		 	By:	/s/ Mehul Patel
		 	 	Name:	Mehul Patel
		 	 	Title:	Manager
	 	 	 	 
		By:	NewcrestImage, LLC,
		      	a Texas limited liability company, its Member
	 	 	 	 
		 	By:	/s/ Mehul Patel
		 	 	Name:	Mehul Patel
		 	 	Title:	President

 

		C&D FAMILY HOLDINGS, LLC,
		a Texas limited liability company
	 	 
		By:	/s/ Chirag Patel
		 	Name:	Chirag Patel
		 	Title:	Manager
	 	 
		SAGESTAR FAMILY, LLC,
		a Texas limited liability company
	 	 
		By:	/s/ Mehul Patel
		 	Name:	Mehul Patel
		 	Title:	Manager
	 	 
		By:	/s/ Sanjay Patel
		 	Name:	Sanjay Patel
		 	Title:	Manager

 

[Signature
Page to Director Nomination Agreement]

 

    9Exhibit 10.3

 

TAX PROTECTION
AGREEMENT

 

THIS TAX PROTECTION AGREEMENT
(this “Agreement”) is made and entered into as of January 13, 2022 by and among SUMMIT HOTEL OP, LP, a Delaware limited
partnership (the “Partnership”), and NEWCRESTIMAGE HOLDINGS, LLC, a Delaware limited liability company, Sagestar
Family, LLC, a Delaware limited liability company, and C&D Family Holding, LLC,
a Delaware limited liability company (the “Contributors”);

 

WHEREAS, the Contributors, pursuant
to that certain Contribution and Purchase Agreement, dated as of November 2, 2021 (the “Contribution Agreement”), are
indirectly contributing (the “Contribution”) their interest in the Property (as identified on Schedule 2.1(b)) to the
Partnership, in exchange for common units of partnership interests in the Partnership (the “Common Units”) and Series Z preferred
units of partnership interests in the Partnership (the “Preferred Units,” and with the Common Units, the “Units”);

 

WHEREAS, it is intended for
federal, state and local income tax purposes that the Contribution for Units will be treated as a tax-deferred contribution of the Property
to the Partnership by the Contributors (or entities owned directly or indirectly owned by the Contributors) for Units under Section 721
of the Code;

 

WHEREAS, immediately following
the Contribution, the Partnership will contribute the Property to a subsidiary that will be treated as a real estate investment trust
(“Master REIT 2”) for U.S. federal income tax purposes in a transaction that is intended to be treated as a tax-deferred contribution
under Section 351 of the Code, and Master REIT 2 will, in turn, be contributed to Summit Hospitality JV, LP, a Delaware limited partnership
in a transaction that is intended to be treated as a tax-deferred contribution under Section 721 of the Code;

 

WHEREAS, in consideration for
the agreement of the Contributors to make the Contribution, the parties desire to enter into this Agreement regarding certain tax matters
as set forth herein; and

 

WHEREAS, the Partnership desires
to evidence its agreement regarding amounts that may be payable in the event of certain actions being taken by the Partnership regarding
the disposition of certain of the contributed assets.

 

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

 

ARTICLE
1

DEFINITIONS

 

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

 

“Accounting Firm”
has the meaning set forth in the Section 4.2.

 

     

     

    

 

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

 

“Book Gain”
means any gain that would not be required under Section 704(c) of the Code and the applicable regulations to be specially allocated to
the Protected Partner for federal income tax purposes (for example, any gain attributable to appreciation in the actual value of the Gain
Limitation Property following the Closing Date or any gain resulting from reductions in the “book value” of the Gain Limitation
Property following the Closing Date).

 

“Cash Consideration”
has the meaning set forth in Section 2.1.1.

 

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

 

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

 

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

 

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

 

“Contribution Agreement”
has the meaning set forth in the Recitals.

 

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

 

“Final Determination”
means (i) a decision, judgment, decree or other order by any court of competent jurisdiction, which decision, judgment, decree or other
order has become final after all allowable appeals by either party to the action have been exhausted or after the time for filing such
appeals has expired, (ii) a binding settlement agreement entered into in connection with an administrative or judicial proceeding (iii)
the expiration of the time for instituting a claim for refund, or if such a claim was filed, the expiration of the time for instituting
suit with respect thereto or (iv) the expiration of the time for instituting suit with respect to a claimed deficiency.

 

“Gain Limitation Property”
means (i) the property identified on Schedule 2.1(b) hereto as a Gain Limitation Property; (ii) any other property or asset hereafter
acquired by the Partnership or any direct or indirect interest owned by the Partnership in any entity that owns an interest in a Gain
Limitation Property, if the disposition of that property or asset would result in the recognition of Protected Gain by a Protected Partner
(including, for the avoidance of doubt, interests in Master REIT 2 and Summit Hospitality JV, LP); and (iii) any other property that the
Partnership directly or indirectly receives that is in whole or in part a “substituted basis property” as defined in Section
7701(a)(42) of the Code with respect to a Gain Limitation Property.

 

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

 

    2

     

    

 

“Notice Period”
means the period commencing on the Closing Date, and ending at such time as such Protected Partner has disposed of 100% of the Units received
upon the Contribution in one or more taxable transactions.

 

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

 

“Partnership Agreement”
means the First Amended and Restated Agreement of Limited Partnership of Summit Hotel OP, LP, dated February 14, 2011, as amended from
time to time in accordance with the terms thereof.

 

“Partnership Interest
Consideration” has the meaning set forth in Section 2.1.1.

 

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

 

“Property”
or “Properties” means the real estate property directly or indirectly transferred to the Partnership by the Contributors
and listed on Schedule 2.1(b) hereto.

 

“Protected Gain”
shall mean the gain that would be allocable to and recognized by a Protected Partner for federal income tax purposes under Section 704(c)
of the Code in the event of the sale of a Gain Limitation Property in a fully taxable transaction. The initial amount of Protected Gain
with respect to each Protected Partner shall be determined as if the Partnership sold each Gain Limitation Property in a fully taxable
transaction on the Closing Date for consideration equal to the Section 704(c) Value of such Gain Limitation Property on the Closing Date,
and is set forth on Schedule 2.1(b) hereto, which amount shall be updated by the Contributors within sixty (60) days of the Closing
Date. Book Gain shall not be considered Protected Gain.

 

“Protected Partner”
means each of (i) the Contributors, (ii) the property owner entities that hold the Property at the time of the Contribution, (iii) any
entities that are disregarded as separate from the Contributors for federal income tax purposes that directly or indirectly own interests
in such property owner entities at the time of the Contribution and will directly or indirectly hold Units and (iv) any persons who (A)
acquire Units from a Protected Partner in a transaction in which gain or loss is not recognized in whole or in part and in which such
transferee’s adjusted basis for federal income tax purposes is determined in whole or in part by reference to the adjusted basis
of the Protected Partner in such Units, (B) has notified the Partnership of its status as a Protected Partner, and (C) provides all
documentation reasonably requested by the Partnership to verify such status, but excludes any person that ceases to be a Protected Partner
pursuant to this Agreement.

 

“Section 704(c) Value”
means the fair market value of any Gain Limitation Property as of the Closing Date, as determined pursuant to the Contribution Agreement
and as set forth next to each Gain Limitation Property on Schedule 2.1(b) hereto. The Partnership shall initially carry the Gain
Limitation Property on its books at a value equal to the Section 704(c) Value as set forth in the preceding sentence.

 

“Subsidiary”
means any entity in which the Partnership owns a direct or indirect interest that owns a Gain Limitation Property on the Closing
Date, after giving effect to the Contribution, or that thereafter is a successor to the Partnership’s direct or indirect
interests in a Gain Limitation Property.

 

    3

     

    

 

“Tax Protection Period”
means the period commencing on the Closing Date and ending at 12:01 AM on January 13, 2032, provided, however, that the
Tax Protection Period shall terminate at such time as there is a Final Determination that no portion of the Contribution qualified for
tax-deferred treatment under Section 721 of the Code.

 

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

 

ARTICLE
2

Restrictions on Dispositions of

Gain limitation Properties

 

2.1          
Restrictions on Disposition of Gain Limitation Properties.

 

2.1.1       
The Partnership agrees for the benefit of each Protected Partner, for the term of the Tax Protection Period, not to directly or
indirectly sell, exchange, transfer, or otherwise dispose of a Gain Limitation Property or any interest therein (including any Units),
without regard to whether such disposition is voluntary or involuntary, in a transaction that would cause the Protected Partner to recognize
any Protected Gain.

 

Without limiting the foregoing,
the term “sale, exchange, transfer or disposition” by the Partnership shall be deemed to include, and the prohibition shall
extend to:

 

		(i)	any direct or indirect disposition by any direct or indirect Subsidiary of any Gain Limitation Property
or any interest therein;

 

		(ii)	any direct or indirect disposition by the Partnership of any Gain Limitation Property (or any direct or
indirect interest therein) that is subject to Section 704(c)(1)(B) of the Code and the Treasury Regulations thereunder; and

 

		(iii)	any distribution by the Partnership to a Protected Partner that is subject to Section 737 of the Code
and the Treasury Regulations thereunder.

 

Without limiting the foregoing,
a disposition shall include any transfer, voluntary or involuntary, by the Partnership or any Subsidiary in a foreclosure proceeding,
pursuant to a deed in lieu of foreclosure, or in a bankruptcy proceeding.

 

Notwithstanding the
foregoing, this Section 2.1 shall not apply to a voluntary, actual disposition by a Protected Partner of Units in connection
with a merger or consolidation of the Partnership pursuant to which (i) the Protected Partner is offered as consideration for the
Units either (A) cash or property treated as cash pursuant to Section 731 of the Code (“Cash Consideration”) or
(B) partnership interests and the receipt of such partnership interests would not result in the recognition of gain for federal,
state, or local income tax purposes by the Protected Partner (“Partnership Interest Consideration”); (ii) the
Protected Partner has the right to elect to receive solely Partnership Interest Consideration in exchange for his Units and the
continuing partnership has agreed in writing to assume the obligations of the Partnership under this Agreement; (iii) no Protected
Gain is recognized by the Partnership as a result of any partner of the Partnership receiving Cash Consideration; and (iv) the
Protected Partner elects to receive Cash Consideration in part or in whole.

 

    4

     

    

 

Notwithstanding the restriction
set forth in this Section 2.1, the Partnership and any Subsidiary may dispose of any Gain Limitation Property (or any interest
therein) if such disposition qualifies as a “like-kind exchange” under Section 1031 of the Code, or an involuntary conversion
under Section 1033 of the Code, or other transaction (including, but not limited to, a contribution of property to any entity that qualifies
for the non-recognition of gain under Section 721 or Section 351 of the Code, or a merger or consolidation of the Partnership with or
into another entity that qualifies for taxation as a “partnership” for federal income tax purposes) that, as to each of the
foregoing, does not result in the recognition of any taxable income or gain to any Protected Partner with respect to any of the Units;
provided, however, that in the case of a “like-kind exchange” under Section 1031 of the Code, if such exchange
is with a “related party” within the meaning of Section 1031(f)(3) of the Code, any direct or indirect disposition by such
related party of the Gain Limitation Property or any other transaction prior to the expiration of the two (2) year period following such
exchange that would cause Section 1031(f)(1) of the Code to apply with respect to such Gain Limitation Property (including by reason of
the application of Section 1031(f)(4) of the Code) shall be considered a violation of this Section 2.1 by the Partnership.

 

ARTICLE
3

Reserved 

  

ARTICLE
4

Remedies for Breach

 

4.1         
Monetary Damages.

 

4.1.1       
In the event that the Partnership breaches its obligations set forth in Article 2 with respect to a Protected Partner on
or prior to January 13, 2032, the Protected Partner’s sole remedy shall be to receive from the Partnership, and the Partnership
shall pay to such Protected Partner as damages, an amount equal to the aggregate federal, state, and local income taxes incurred by the
Protected Partner or an Indirect Owner with respect to the Protected Gain that is allocable to such Protected Partner under the Partnership
Agreement as a result of such breach.

 

In addition, the Partnership
shall pay to the Protected Partner or Indirect Owner an amount equal to the aggregate federal, state, and local income taxes payable by
the Protected Partner or Indirect Owner as a result of the receipt of any payment required under this Section 4.1 (i.e., providing the
Protected Partner with a “gross-up on the gross-up”).

 

For purposes of computing
the amount of federal, state, and local income taxes required to be paid by a Protected Partner (or Indirect Owner), any deduction
for state income taxes payable as a result thereof actually allowed in computing federal income taxes shall be taken into account,
and a Protected Partner’s (or Indirect Owner’s) tax liability shall be computed using the highest federal, state and
local marginal income tax rates (plus the tax rate on net investment income, if applicable) that would be applicable to an
individual resident of Dallas, Texas (taking into account the character and type of such income or gain) for the year with respect
to which the taxes must be paid, without regard to any deductions, losses or credits that may be available to such Protected Partner
(or Indirect Owner) that would reduce or offset its actual taxable income or actual tax liability if such deductions, losses or
credits could be utilized by the Protected Partner (or Indirect Owner) to offset other income, gain or taxes of the Protected
Partner (or Indirect Owner), either in the current year, in earlier years, or in later years.

 

    5

     

    

 

Notwithstanding the foregoing,
(i) at any time that the Contributors (or one or more successor Protected Partners) have disposed of 75% or more of the Common Units received,
directly or indirectly, pursuant to the Contribution Agreement by the Contributors in one or more taxable transactions or (ii) commencing
at 12:01 AM on January 13, 2029 until January 13, 2032, any damages otherwise payable to a Protected Party or Indirect Owner pursuant
to this Section 4.1 shall be multiplied by the fraction equal to (i) the aggregate fair market value of any Series Z preferred units held
by such Protected Partner divided by (ii) the aggregate fair market value of all Units held by such Protected Partner. This paragraph
is intended to provide that the Protected Partners shall not receive the benefit of tax protection under this Agreement with respect to
Common Units (i) at any time that the Contributors (or one or more successor Protected Partners) have disposed of 75% or more of the Common
Units received, directly or indirectly, pursuant to the Contribution Agreement by the Contributors in one or more taxable transactions
or (ii) at 12:01 AM on or after January 13, 2029.

 

For the avoidance of doubt,
if there are any Gain Limitation Properties with multiple Protected Partners or Indirect Owners listed on Schedule 2.1(b), any amounts
owed pursuant to this Section 4.1 shall only be paid once with respect to each dollar of Protected Gain allocated, and such amounts shall
be paid to the Protected Partner to whom the Protected Gain is allocated directly form the Partnership (i.e., the legal entity that owns
the related Units at the time of such payment). The Partnership shall not be required to duplicate any amounts owed pursuant to this Section
4.1 among multiple Protected Partners or Indirect Owners.

 

4.2              Process
for Determining Damages. If the Partnership has breached or violated any of the covenants set forth in Article 2 (or a
Protected Partner asserts that the Partnership has breached or violated any of the covenants set forth in Article 2), the
Partnership and the Protected Partner (or Indirect Owner) agree to negotiate in good faith to resolve any disagreements regarding
any such breach or violation and the amount of damages, if any, payable to such Protected Partner (or Indirect Owner) under Section
4.1. If any such disagreement cannot be resolved by the Partnership and such Protected Partner (or Indirect Owner) within sixty
(60) days after the receipt of notice from the Partnership of such breach and the amount of income to be recognized by reason
thereof (or, if applicable, receipt by the Partnership of an assertion by a Protected Partner that the Partnership has breached or
violated any of the covenants set forth in Article 2), the Partnership and the Protected Partner shall jointly retain a
nationally recognized independent public accounting firm (an “Accounting Firm”) to act as an arbitrator to
resolve as expeditiously as possible all points of any such disagreement (including, without limitation, whether a breach of any of
the covenants set forth in Article 2, has occurred and, if so, the amount of damages to which the Protected Partner is
entitled as a result thereof, determined as set forth in Section 4.1). The Partnership and the Protected Partner shall
cooperate with the Accounting Firm and shall furnish the Accounting Firm with all information reasonably requested by the Accounting
Firm. All determinations made by the Accounting Firm with respect to the resolution of any breach or violation of any of the
covenants set forth in Article 2 and the amount of damages payable to the Protected Partner under Section 4.1 shall be
final, conclusive and binding on the Partnership and the Protected Partner. The fees and expenses of any Accounting Firm incurred in
connection with any such determination shall be shared equally by the Partnership and the Protected Partner.

 

    6

     

    

 

4.3             
Required Notices; Time for Payment. In the event that there has been a breach of Article 2, the Partnership shall
provide to each affected Protected Partner notice of the transaction or event giving rise to such breach as soon as reasonably practicable,
but not later than at such time as the Partnership provides to the Protected Partners the IRS Schedule K-1’s to the Partnership’s
federal income tax return for the year of such transaction. All payments required to be made under this Article 4 to any Protected
Partner shall be made to such Protected Partner on or before April 15 of the year following the year in which the gain recognition event
giving rise to such payment took place; provided that, if the Protected Partner is required to make estimated tax payments that would
include such gain (taking into account all available safe harbors), the Partnership shall make a payment to the Protected Partner on or
before the due date for such estimated tax payment and such payment from the Partnership shall be in an amount that corresponds to the
amount of the estimated tax being paid by such Protected Partner at such time as a result of the gain recognition event, which payment
shall be credited against the total amount payable under this Article 4. In the event of a payment made after the date required pursuant
to this Section 4.3, interest shall accrue on the aggregate amount required to be paid from such date to the date of actual payment
at a rate equal to the “prime rate” of interest, as published in the Wall Street Journal (or if no longer published there,
an equivalent publication) effective as of the date the payment is required to be made.

 

ARTICLE
5 Notice of Tax Audits. If any claim, demand, assessment (including a notice of proposed assessment) or other
assertion is made with respect the Contribution, recognition of any Protected Gain, or any other matter covered in this Agreement (a
 “Tax Claim”), then the Partnership shall promptly notify the Protected Partner of such Tax Claim and shall keep the
Protected Partner reasonably informed of the details and status of any such Tax Claim (including providing the Protected Partner
with copies of all material written correspondence regarding such matter). The Partnership agrees to use commercially reasonable
efforts to resolve any tax claim in a manner such that the contribution qualifies under section 721 of the Code (taking into account
the impact on the Partnership and all of its limited partners). 

 

NOTICE
OF INTENTION TO SELL GAIN LIMITATION PROPERTY DURING NOTICE PERIOD

 

During the Notice Period,
if the Partnership intends to dispose of a Gain Limitation Property in a taxable transaction and such disposition is reasonably likely
to give rise to a payment obligation pursuant to this Agreement, the Partnership shall use commercially reasonable efforts to provide
at least 90 days’ prior written notice (prior to the closing of such disposition) to the Protected Partners.

 

    7

     

    

 

ARTICLE
6 

Amendment of this Agreement; Waiver of certain provisions; approval of certain transactions

 

6.1             
Amendment. This Agreement may not be amended, directly or indirectly (including by reason of a merger between the Partnership
and another entity) except by a written instrument signed by the Partnership, and each of the Protected Partners to be subject to such
amendment, except that the Partnership may amend Schedule 2.1(a) upon a person becoming a Protected Partner as a result of
a transfer of Units.

 

ARTICLE
7

Miscellaneous

 

7.1             
Additional Actions and Documents. Each of the parties hereto hereby agrees to take or cause to be taken such further actions,
to execute, deliver, and file or cause to be executed, delivered and filed such further documents, and will obtain such consents, as may
be necessary or as may be reasonably requested in order to fully effectuate the purposes, terms and conditions of this Agreement.

 

7.2             
Assignment. No party hereto shall assign its or his rights or obligations under this Agreement, in whole or in part, except
by operation of law, without the prior written consent of the other parties hereto, and any such assignment contrary to the terms hereof
shall be null and void and of no force and effect.

 

7.3             
Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the Protected Partners and
their respective successors and permitted assigns that satisfy the definition of Protected Partner, whether so expressed or not. This
Agreement shall be binding upon the Partnership, and any entity that is a direct or indirect successor, whether by merger, transfer, spin-off
or otherwise, to all or substantially all of the assets of the Partnership (or any prior successor thereto as set forth in the preceding
portion of this sentence), provided that none of the foregoing shall result in the release of liability of the Partnership hereunder.
The Partnership covenants with and for the benefit of the Protected Partners not to undertake any transfer of all or substantially all
of the assets of either entity (whether by merger, transfer, spin-off or otherwise) unless the transferee has acknowledged in writing
and agreed in writing to be bound by this Agreement, provided that the foregoing shall not be deemed to permit any transaction
otherwise prohibited by this Agreement.

 

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

 

    8

     

    

 

7.5             
Representations and Warranties Regarding Authority; Noncontravention. The Partnership has the requisite corporate or other
(as the case may be) power and authority to enter into this Agreement and to perform its respective obligations hereunder. The execution
and delivery of this Agreement by the Partnership and the performance of each of its respective obligations hereunder have been duly authorized
by all necessary corporate, partnership, or other (as the case may be) action on the part of the Partnership. This Agreement has been
duly executed and delivered by the Partnership and constitutes a valid and binding obligation of each of the Partnership, enforceable
against the Partnership in accordance with its terms, except as such enforcement may be limited by (i) applicable bankruptcy or insolvency
laws (or other laws affecting creditors’ rights generally) or (ii) general principles of equity. The execution and delivery of this
Agreement by the Partnership do not, and the performance by each of its respective obligations hereunder will not, conflict with, or result
in any violation of (i) the Partnership Agreement or (ii) any other agreement applicable to the Partnership, other than, in the case of
clause (ii), any such conflicts or violations that would not materially adversely affect the performance by the Partnership of its obligations
hereunder.

 

7.6             
Captions. The Article and Section headings contained in this Agreement are inserted for convenience of reference only, shall
not be deemed to be a part of this Agreement for any purpose, and shall not in any way define or affect the meaning, construction or scope
of any of the provisions hereof.

 

7.7             
Notices. All notices and other communications given or made pursuant hereto shall be in writing and shall be deemed to have
been duly given or made as of the date delivered, mailed or transmitted, and shall be effective upon receipt, if delivered personally,
mailed by registered or certified mail (postage prepaid, return receipt requested) to the parties at the following addresses (or at such
other address for a party as shall be specified by like changes of address) or sent by electronic transmission to the telecopier number
specified below:

 

		(i)	if to the Partnership, to:

 

	 	 	Summit Hotel OP, LP
	 	 	c/o Summit Hotel Properties, Inc.
	 	 	Attn: Christopher Eng
	 	 	13215 Bee Cave Parkway, Suite B-300
	 	 	Austin, TX 78738
	 	 	Telephone: (512) 538-2300
	 	 	Fax: (512) 538-2333

 

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

 

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

 

    9

     

    

 

7.8              
Counterparts. This Agreement may be executed in two or more counterparts, all of which shall be considered one and the same
agreement and each of which shall be deemed an original.

 

7.9              
Governing Law. The interpretation and construction of this Agreement, and all matters relating thereto, shall be governed
by the laws of Texas, without regard to the choice of law provisions thereof.

 

7.10            
Consent to Jurisdiction; Enforceability.

 

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

 

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

 

7.11            
Severability. If any part of any provision of this Agreement shall be invalid or unenforceable in any respect, such part
shall be ineffective to the extent of such invalidity or unenforceability only, without in any way affecting the remaining parts of such
provision or the remaining provisions of this Agreement.

 

7.12            
Costs of Disputes. Except as otherwise expressly set forth in this Agreement, the non-prevailing party in any dispute arising
hereunder shall bear and pay the costs and expenses (including, without limitation, reasonable attorneys’ fees and expenses) incurred
by the prevailing party or parties in connection with resolving such dispute.

 

7.13            
Enforcement by Protected Partners. The Protected Partner is the beneficiary of this Agreement and shall be able to enforce
this Agreement as they were parties to this Agreement.

 

7.14            
Term. The term of this Agreement shall extend from the date hereof until such time as the applicable statute of limitations
bars a claim by the Internal Revenue Service or relevant state or local tax authority for a tax otherwise indemnifiable under this Agreement.

 

7.15            Other.
When a reference is made in this Agreement to Sections, such reference shall be to a Section of this Agreement, unless otherwise
indicated. The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Whenever the words “include,” “includes” or “including” are
used in this Agreement, they shall be deemed to be followed by the words “without limitation.

 

    10

     

    

 

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    11

     

    

 

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

 

	 	SUMMIT HOTEL OP, LP
	 	a Delaware limited liability company
	 	 
	 	By: Summit Hotel GP, LLC,
	 	a Delaware limited liability company,
    its General Partner
	 	 
	 	By: Summit Hotel Properties, Inc.,
	 	a Maryland corporation, its sole member
	 	 
	 	 	By:	/s/ Christopher Eng
	 	 	Name: Christopher R. Eng
	 	 	Title: Secretary 
	 	 
	 	NEWCRESTIMAGE HOLDINGS, LLC,
	 	a Delaware limited liability company
	 	 
	 	 	By:	/s/ Mehul Patel
	 	 	Name: Mehul Patel
	 	 	Title: Manager 
	 	 
	 	Sagestar
    Family, LLC,
	 	a Delaware limited liability company
	 	 
	 	 	By:	/s/ Mehul Patel
	 	 	Name: Mehul Patel
	 	 	Title: Manager 
	 	 
	 	C&D
    Family Holding, LLC,
	 	a Delaware limited liability company
	 	 
	 	 	By:	/s/ Chirag Patel
	 	 	Name: Chirag Patel
	 	 	Title: Manager

 

Signature to Tax Protection
Agreement

 

     

     

    

 

SCHEDULES TO THE TAX PROTECTION AGREEMENT

 

	Schedule 2.1(a)	List of Protected Partners
	Schedule 2.1(b)  	Gain Limitation Property, Protected Gain and Section 704(c) Value

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