Document:

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                                                                  Exhibit 10.100

                           PURCHASE AND SALE AGREEMENT

                                 BY AND BETWEEN

                          THI III GL INVESTMENTS L.L.C.

                                    AS SELLER

                                       AND

                           CNL HOTELS & RESORTS, INC.

                                  AS PURCHASER

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Definitions

      The following capitalized terms used in this Agreement are defined in the
sections indicated below:

<TABLE>
<S>                                                <C>
2006 Building Estimate                             Section 6.11
2006 Business Plan                                 Section 6.11
Accountants                                        Section 13.7
Adjustment                                         Section 13.7
Agreement                                          Introduction
Amendment to Declaration                           Section 6.12(b)
Amended Settlement Agreement                       Section 6.2(b)
Anti-Money Laundering and Anti-Terrorism Laws      Section 3.14(a)
Apportionment Date                                 Section 13.1
Appurtenances                                      Section 1.1
Broker                                             Section 14.14
Capital Projects                                   Section 6.10
Cash                                               Section 13.10
Closing                                            Section 5.1
Closing Date                                       Section 5.1
Contract Date                                      Introduction
Current Ledger                                     Section 13.3
Deed                                               Section 9.1
Deposit                                            Section 2.3
Development Agreement                              Section 6.9
Development Amount                                 Section 13.9
Development Letter                                 Section 13.10
Environmental Documents                            Section 3.8
Environmental Laws                                 Section 3.8
Equipment Leases                                   Section 1.2
Escrow Agent                                       Section 2.1
Escrow Instructions                                Section 2.3
Excluded Property                                  Section 1.2
Executive Order                                    Section 3.14(a)
Existing Loan                                      Section 5.2
Feasibility Period                                 Section 6.7(b)
FF&E                                               Section 1.2
FF&E Reserves                                      Section 13.10
Fixed Asset Supplies                               Section 1.2
Front Desk Closing Hour                            Section 13.3
Golf Club                                          Section 1.1
Government List                                    Section 3.14(e)
Gross Accounts Receivable                          Section 13.4
Hazardous Substances                               Section 3.8
Improvements                                       Section 1.1
Intangible Property                                Section 1.2
Inventories                                        Section 1.2
JW Marriott                                        Section 1.1
Land                                               Section 1.1
Lender                                             Section 5.2
Lender's Prepayment Consent                        Section 6.8
Management Agreements                              Section 1.2
Management Agreement Assignment                    Section 9.7
Manager                                            Section 1.2
</TABLE>

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<TABLE>
<S>                                                <C>
Manager's Consent                                  Section 6.5
Marriott Design                                    Section 6.9
Master Declaration                                 Section 6.3
Operating Lease                                    Section 7.7
Operating Lessee                                   Section 7.7
Owner's Affidavit                                  Section 9.11
Pending Contracts                                  Section 6.1
Percentage Rent Period                             Section 13.1(c)
Permits                                            Section 1.2
Permitted Exceptions                               Section 6.2(a)
Personal Property                                  Section 1.2
Post-Closing Liability Cap                         Section 14.7
Property                                           Section 1.2
Property Documents                                 Section 3.13
PTO Credit                                         Section 13.8
Purchase Price                                     Section 2.1
Purchaser                                          Introduction
Purchaser Closing Certificate                      Section 9.11
Purchaser Loan Termination Cost                    Section 5.2
Reserves                                           Section 1.2
Resort                                             Section 1.1
Ritz-Carlton                                       Section 1.1
Rooms Agreements                                   Section 1.2
Scheduled Personalty                               Section 1.2
Seller                                             Introduction
Seller's Closing Certificate                       Section 9.11
Seller's Post-Closing Obligations                  Section 14.7
Service Contracts                                  Section 1.2
Settlement Agreement                               Section 6.2(b)
Spa                                                Section 1.1
Space Leases                                       Section 1.2
Stormwater Management System Declaration           Section 6.12
Survey                                             Section 3.22
Survival Period                                    Section 14.1
Tax Appeal                                         Section 13.1(a)
Termination Notice                                 Section 6.7(b)
Threshold                                          Section 14.7
Title Commitment                                   Section 3.13
Uniform System of Accounts                         Section 1.2
WARN                                               Section 14.22
Warranties                                         Section 9.10
</TABLE>

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                           PURCHASE AND SALE AGREEMENT

      THIS PURCHASE AND SALE AGREEMENT (this "AGREEMENT") is executed as of the
____ day of December, 2005 (the "CONTRACT DATE") by and between THI III GL
INVESTMENTS L.L.C., a Delaware limited liability company (the "SELLER"), and CNL
HOTELS & RESORTS, INC., a Maryland corporation (the "PURCHASER").

                                    ARTICLE I
                                      SALE

      Subject to the terms and conditions set forth in this Agreement, Seller
agrees to sell and convey to Purchaser, and Purchaser agrees to buy from Seller:

      1.1 RESORT. All those certain parcels of land situated in Orlando,
Florida, commonly known as Grande Lakes Orlando, as described on EXHIBIT A
attached hereto (the "LAND"), including all right, title and interest of Seller,
if any, in and to the land lying in the bed of any street or highway in front of
or adjoining each such parcel to the center line thereof, all water and mineral
rights, development rights and all easements, rights and other interests
appurtenant thereto (the "APPURTENANCES"), and together with all buildings and
other improvements that are located thereon, including, without limitation, the
approximately 998-room JW Marriott Hotel (the "JW MARRIOTT"), the approximately
584-room Ritz-Carlton Hotel (the "RITZ-CARLTON"), a spa containing approximately
41,000 square feet (the "SPA"), the Ritz-Carlton Golf Club, including the
18-hole golf course, practice facilities, a club house containing approximately
10,800 square feet, pro-shop and other indoor and outdoor amenities (the "GOLF
CLUB"), and all elevators, escalators, furnaces, heating, ventilating and
air-conditioning systems and equipment, fixtures, electrical equipment, fire
prevention and extinguishing apparatus located therein (the "IMPROVEMENTS"). The
Land, the Appurtenances and the Improvements collectively are referred to herein
as the "RESORT."

      1.2 PERSONAL PROPERTY. All of Seller's right, title and interest, if any,
in the following personalty: (a) all furniture, furnishings, fixtures (other
than those which are part of the Improvements), vehicles, rugs, mats, carpeting,
appliances, devices, engines, telephone and other communications equipment,
televisions and other video equipment, plumbing fixtures and other equipment
located in or related to the Resort, excluding property described in the
Equipment Leases (the "FF&E"); (b) the leases of equipment, furnishings or other
personal property located at, and used in connection with, the operation of the
Resort, as listed on EXHIBIT B attached hereto (the "EQUIPMENT LEASES"); (c) all
items included within the definition of "Property and Equipment" under the
Uniform System of Accounts for the Lodging Industry, Ninth Revised Edition,
1996, as published by the Hotel

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Association of New York City, Inc. (the "UNIFORM SYSTEM OF ACCOUNTS"),
including, without limitation, works of art, silver, linen, china, mattresses,
bed linens, pillows, blankets, towels, toiletries, glassware, appliances,
utensils, cookware, tableware, and uniforms and similar items, whether in use or
held in stock for future use, in connection with the operation of the Resort,
subject to such depletion and including such resupplies prior to the Closing
Date as shall occur in the ordinary course of business (the "FIXED ASSET
SUPPLIES"); (d) all "Inventories" as defined in the Uniform System of Accounts,
such as liquor and other provisions in storerooms, refrigerators, pantries, and
kitchens, beverages in wine cellars, bars, and mini bars, other merchandise
intended for sale or resale, fuel, mechanical supplies, stationery and other
paper supplies, guest supplies, maintenance and housekeeping supplies, operating
supplies and other expensed supplies and similar items (the "INVENTORIES"),
provided that to the extent that any applicable law prohibits the transfer of
alcoholic beverages from Seller to Purchaser, such beverages shall not be
considered a part of Inventories; (e) the service, maintenance and other
agreements in connection with the operation of the Resort identified in EXHIBIT
C attached hereto (the "SERVICE CONTRACTS"); (f) the leases, licenses,
concessions and other agreements granting any occupancy, possessory or entry
rights in or to the Resort, identified in EXHIBIT D attached hereto (the "SPACE
LEASES"), including any prepaid rents or deposits held by Seller (or Marriott
International, Inc. ("MANAGER")) thereunder; (g) the corporate, airline, bus,
tour operator, barter and similar agreements identified in EXHIBIT E attached
hereto, pursuant to which third parties have been given certain rights to rooms
or services at the Resort from and/or after the Closing Date (the "ROOMS
AGREEMENTS"); (h) the aggregate amount of any deposits received by Seller
(whether paid in cash or by credit card) as a downpayment for reservations made
for rooms, banquets, meals or other services to be supplied from and/or after
the Closing Date; (i) to the extent in Seller's possession, surveys,
architectural, consulting and engineering blueprints, plans and specifications
and drawings related to the Resort, all telephone numbers, websites and domains
(including access to FTP file content) (to the extent such websites and domains
are owned by Seller and not Manager), trade names, logos, signage rights,
warranties, all non-proprietary customer and guest lists and information and any
goodwill of Seller; (j) the Management Agreements and other related documents
set forth on EXHIBIT G attached hereto (collectively, the "MANAGEMENT
AGREEMENTS"); (k) to the extent assignable, all licenses, permits,
authorizations and approvals necessary for the operation of the Resort (the
"PERMITS"); (l) development rights, vested rights, benefits, privileges,
exceptions, authorizations and any and all entitlements (including expansion
entitlements), all guarantees, books and records maintained at the Property
(provided that Seller may retain duplicate copies thereof), and all rights of
Seller, if any, to pursue claims against Marriott Design, architects,
contractors or suppliers in connection with the original construction of the
Resort (collectively, the "INTANGIBLE PROPERTY"); (m) any and all other items of
personalty located on, and used in connection with the operation of, the Resort,
but excluding (i) accounts receivable for periods prior to

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and including the Apportionment Date; (ii) property of guests; (iii) items owned
by the Manager and tenants, occupants or concessionaires under the Space Leases
or other third parties as listed on EXHIBIT AA attached hereto (the "SCHEDULED
PERSONALTY"); (iv) tax deposits, including, without limitation, sales tax
deposits, utility deposits and other deposits held by parties other than Seller,
except for any transferable deposits assigned to Purchaser, for which Seller is
to be reimbursed as herein provided; (v) any working capital or other tax,
insurance, FF&E, capital improvement and/or other escrows, impounds or reserves
held by the Lender, the Manager or any other party (collectively, the
"RESERVES"), except to the extent such items are specifically assigned to
Purchaser and for which Seller is reimbursed; and (vi) any balances on deposit
with banking institutions relating to the Resort, including amounts held in
"house banks", except to the extent such items are specifically assigned to
Purchaser and for which Seller is reimbursed (all of the foregoing items (i) -
(vi) above, being collectively referred to as the "EXCLUDED PROPERTY") (all of
the foregoing items (a) - (m) above other than the Excluded Property, being
collectively referred to as, the "PERSONAL PROPERTY"). The Personal Property and
the Resort collectively are referred to herein as the "PROPERTY."

                                   ARTICLE II
                                 PURCHASE PRICE

      2.1 PURCHASE PRICE. (a) In accordance with the terms of this Agreement,
Seller shall sell and Purchaser shall buy the Property for a total purchase
price of Seven Hundred Fifty-Five Million and no/100 Dollars ($755,000,000.00),
subject to adjustment as described in Article XIII below (the "PURCHASE PRICE"),
payable to Seller on the Closing Date by a wire transfer to The Talon Group, a
division of First American Title Insurance Company (the "ESCROW AGENT").

      2.2 ALLOCATION OF PURCHASE PRICE. The parties agree to allocate the
Purchase Price among the Resort and various items of Personal Property during
the Feasibility Period. Such allocation shall be arrived at by a process of
arm's-length negotiations, including, without limitation, the parties' best
judgment as to the fair market value of each respective asset, and the parties
specifically agree to the allocation as final and binding, and will consistently
reflect those allocations on their respective federal, state and local tax
returns, including any state, county and other local transfer or sales tax
declarations or forms to be filed in connection with this transaction, which
obligations shall survive the Closing. In the event that the parties are unable
to agree in good faith to an allocation of the Purchase Price during the
Feasibility Period, and Purchaser does not deliver a Termination Notice to
Seller pursuant to the terms of Section 6.7(b) hereof, the allocation of the
Purchase Price set forth on EXHIBIT F attached hereto shall control.

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      2.3 DEPOSIT. Simultaneously with the execution and delivery of this
Agreement, Purchaser shall deliver to Escrow Agent a deposit (together with any
interest earned thereon, the "DEPOSIT") in the amount of Fifteen Million and
no/100 Dollars ($15,000,000.00), comprised of immediately available funds.
Escrow Agent shall hold the Deposit in accordance with the form of escrow
instructions (the "ESCROW INSTRUCTIONS") attached hereto as EXHIBIT H.

                                   ARTICLE III
               SELLER'S REPRESENTATIONS, WARRANTIES AND COVENANTS

      In order to induce Purchaser to enter into this Agreement and to
consummate the transactions contemplated hereby, Seller represents and warrants
to, and covenants with, Purchaser as follows:

      3.1 GOOD STANDING. Seller is a limited liability company, duly organized,
and legally and validly existing and in good standing under the laws of State of
Delaware and is qualified to do business and in good standing in the State of
Florida.

      3.2 TITLE. Seller owns good and marketable title to the Resort, which
shall be subject only to the Permitted Exceptions on the Closing Date. Seller
owns the Personal Property, which shall be subject only to the Permitted
Exceptions on the Closing Date.

      3.3 DUE AUTHORIZATION. The execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby have been
authorized by all requisite limited liability company actions of Seller (none of
which actions have been modified or rescinded, and all of which actions are in
full force and effect) and the individuals executing this Agreement on behalf of
Seller have full power and authority to do so. This Agreement constitutes a
valid and binding obligation of Seller, enforceable against Seller in accordance
with its terms.

      3.4 SPACE LEASES. There are no leases, licenses, concessions or any other
agreements giving anyone other than Seller and transient hotel guests a right to
use or occupy any Property or any part thereof, except for the Space Leases. To
Seller's knowledge, each of the Space Leases is in full force and effect. Seller
has not received any written notice from any tenant under any Space Lease
alleging that Seller is in default or breach thereunder. To Seller's knowledge,
there is no state of facts which, after notice or the passage of time, or both,
would constitute a material default or breach by any tenant under any Space
Lease. True and complete copies of each Space Lease identified on EXHIBIT D have
been provided to Purchaser.

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      3.5 EQUIPMENT LEASES, SERVICE CONTRACTS AND ROOMS AGREEMENTS. True and
complete copies of each of the Equipment Leases, Service Contracts and Rooms
Agreements identified on EXHIBITS B, C AND E, respectively, have been provided
to Purchaser. To Seller's knowledge, there are no material Equipment Leases,
Service Contracts or Rooms Agreements except as set forth on EXHIBITS B, C AND E
(materiality being applied in the aggregate) and each of the Equipment Leases,
Service Contracts and Rooms Agreements are in full force and effect and there
are no material defaults thereunder.

      3.6 LITIGATION. There are no actions, suits, arbitrations, governmental
investigations, bankruptcy or execution proceedings or other proceedings pending
or, to Seller's knowledge, threatened against Seller or to Seller's knowledge,
Manager (solely with respect to its management of the Property), or affecting
the Property before any court or governmental authority other than as set forth
on EXHIBIT N.

      3.7 CONDEMNATION ACTIONS. There are no pending or, to Seller's knowledge,
threatened condemnation actions of any nature with respect to the Property or
any part thereof.

      3.8 HAZARDOUS MATERIALS. The documents identified on EXHIBIT I attached
hereto are referred to as the "Environmental Documents." Except as described in
the Environmental Documents, to Seller's knowledge, there is no violation of any
Environmental Law with respect to the Property. Seller makes no representations
or warranties whatsoever as to the accuracy of the information in the
Environmental Documents (including, without limitation, whether the
Environmental Documents are complete with regard to identifying, characterizing
the extent of or remediation of Hazardous Substances at the Property), and makes
no representation as to the environmental condition of the Property, except as
expressly set forth above. Purchaser acknowledges that it has hired
environmental consultants and counsel to make an independent analysis of
information in the Environmental Documents and to make an independent inspection
of the Property with respect to environmental conditions. As used herein,
"ENVIRONMENTAL LAWS" shall mean all federal state and local laws, statues,
rules, codes, ordinances, regulations, orders, judgments, decrees, binding and
enforceable guidelines, policies or common law now or hereafter in effect and in
each case as amended, or any judicial or administrative interpretation thereof,
including any judicial or administrative order, consent decree or judgment in
each case, to the extent binding, relating to the environment, the protection of
health or Hazardous Substances, including, without limitation, the Comprehensive
Environmental Response Compensation and Liability Act, 42 USC Section 9601 et
seq.; the Resource Conservation and Recovery Act, 42 USC Section 6901 et seq.;
the Federal Water Pollution Control Act, 33 USC Section 1251 et seq.; the Toxic
Substances Control Act, 15 USC Section 2601 et seq.; the Clean Air Act, 42 USC
Section 7401 et seq.; the Safe Drinking Water act, 42

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USC Section 3803 et seq.; the Oil Pollution Act of 1990, 33 USC Section 2701 et
seq.; the Emergency Planning and Community Right-to-Know Act of 1986, 42 USC
Section 11001 et seq.; the Hazardous Material Transportation Act, 49 USC Section
1801 et seq.; and the Occupational Safety and Health Act, 29 USC Section 651 et
seq. (to the extent it regulates occupational exposure to Hazardous Substances);
any state, local or foreign counterparts or equivalents, in each case as amended
from time to time. As used herein, "HAZARDOUS SUBSTANCES" shall mean (a)
substances that are defined or listed in, or otherwise classified pursuant to,
any applicable law or regulations as "hazardous substances," hazardous
materials," "hazardous wastes," "toxic substances," "pollutants," "contaminants"
or other similar term intended to define, list or classify a substance by reason
of such substance's ignitability, corrosivity, reactivity, carcinogenicity,
reproductive toxicity or "EP toxicity", (b) oil, petroleum or petroleum derived
substances, natural gas, natural gas liquids, synthetic gas, drilling fluids,
produced waters and other wastes associated with the exploration, development or
production of crude oil, natural gas or geothermal resources, (c) any flammable
substances or explosives or any radioactive materials, (d) asbestos in any form,
(e) polychlorinated biphenyls, (f) mold, mycotoxins or microbial matter
(naturally occurring or otherwise) and (g) infectious waste.

      3.9 MANAGEMENT AND FRANCHISE AGREEMENTS. There are no management contracts
or franchise agreements relating to the Property other than the Management
Agreements. Each of the Management Agreements is in full force and effect, and
Seller has not received any written notice from Manager alleging Seller is in
default or breach thereunder. Subject to Seller's receipt, and the
effectiveness, of the Manager's Consent, to Seller's knowledge, there is no
state of facts which, after notice or passage of time, or both, would constitute
a material default or breach by Manager under the Management Agreements.

      3.10 LICENSES AND PERMITS. To Seller's knowledge, all required
certificates of occupancy for the Property, and all other Permits necessary for
the operation of the Property have been validly issued and are in good standing.

      3.11 NO VIOLATIONS. Seller has not received any written notification from
any governmental or public authority (i) that the Property is in violation of
any applicable laws, including, without limitation, any fire, health, building,
use, occupancy or zoning laws, where such violation remains outstanding, or (ii)
that any work is required to be done upon or in connection with the Property,
where such work remains outstanding, except for work to be performed as required
pursuant to that certain Notice of Elevator Regional Emergency Access/Fire Key
Requirements received from the Florida Department of Business and Professional
Regulation, a copy of which has been provided to Purchaser.

      3.12 OPERATING STATEMENTS. To Seller's knowledge, the operating statements
listed on EXHIBIT CC attached hereto, copies of which have been

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provided to Purchaser, were prepared in accordance with the requirements of the
Management Agreements and accurately and completely reflect, in all material
respects, the revenue, expenses, income and operating liabilities for the
Property for the periods covered thereby.

      3.13 PROPERTY DOCUMENTS. Except for the Amended Settlement Agreement, the
Amendment to the Declaration or otherwise as disclosed in Commitment No.
FA-C-204095 from First American Title Insurance Company dated November 18, 2005,
obtained by Purchaser for the Resort (the "TITLE COMMITMENT") or in the
documents described on EXHIBIT BB attached hereto, copies of which have been
provided to Purchaser (the "PROPERTY Documents"), Seller has made no commitments
or agreements that would be binding upon Purchaser with any governmental or
quasi-governmental authority, community organization, adjacent property owner or
other person or entity that would reasonably be expected to adversely affect the
use or operation of the Property as a resort.

      3.14 MONEY LAUNDERING. (a) Seller, its principal partners, principal
investors, principal shareholders and affiliates are not in violation of any
laws relating to terrorism, money laundering of the Uniting and Strengthening
America by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Action of 2001, Public Law 107-56 and Executive Order No. 13224
(Blocking Property and Prohibiting Transactions with Persons Who Commit,
Threaten to Commit, or Support Terrorism) (the "EXECUTIVE ORDER") (collectively,
the "ANTI-MONEY LAUNDERING AND ANTI-TERRORISM LAWS"). As such term is used in
this Agreement, a "principal" investor or "principal" shareholder shall mean any
person or entity holding more than five percent (5%) of the equity interests in
Seller or Purchaser, as applicable.

            (b) Seller, its principal partners, principal investors, principal
shareholders and affiliates are not acting, directly or indirectly, on behalf of
terrorists, terrorist organizations or narcotics traffickers, including, without
limitation, those persons or entities that appear on the Annex to the Executive
Order, or are included on any relevant lists maintained by the Office of Foreign
Assets Control of U.S. Department of Treasury, U.S. Department of State, or
other U.S. government agencies, all as may be amended from time to time.

            (c) Seller, its principal partners, principal investors, principal
shareholders and affiliates and, without inquiry, its brokers or other agents,
in any capacity in connection with the purchase of Property (i) do not conduct
any business or engage in making or receiving any contribution of funds, goods
or services to or for the benefit of any person included in the lists set forth
in the preceding paragraph; (ii) do not deal in, or otherwise engage in any
transaction relating to, any property or interests in property blocked pursuant
to the Executive Order; or

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(iii) do not engage in or conspire to engage in any transaction that evades or
avoids, or has the purpose of evading or avoiding, or attempts to violate, any
of the prohibitions set forth in any Anti-Money Laundering and Anti-Terrorism
Laws.

            (d) Seller understands and acknowledges that Purchaser may become
subject to further anti-money laundering regulations, and agrees to execute
instruments, provide information, or perform any other acts as may reasonably be
requested by Purchaser, for the purpose of: (i) carrying out due diligence as
may be required by applicable law to establish Seller's identity and source of
funds; (ii) maintaining records of such identities and sources of funds, or
verifications or certifications as to the same; and (iii) taking any other
actions as may be required to comply with and remain in compliance with
anti-money laundering regulations applicable to Seller.

            (e) Neither Seller, nor any person controlling or controlled by
Seller, is a country, territory, individual or entity named on a Government List
(defined below), and the monies used in connection with this Agreement and
amounts committed with respect thereto, were not and are not derived from any
activities that contravene any applicable anti-money laundering or anti bribery
laws and regulations (including, without limitation, funds being derived from
any person, entity, country or territory on a Government List or engaged in any
unlawful activity defined under 18 USC Section 1956(c)(7)). For purposes of this
Agreement, "GOVERNMENT LIST" means of any of (a) the two lists maintained by the
United States Department of Commerce (Denied Persons and Entities), (b) the list
maintained by the United States Department of Treasury (Specially Designated
Nationals and Blocked Persons) and (c) the two lists maintained by the United
States Department of State (Terrorist Organizations and Debarred Parties).

      3.15 TAXES. All taxes, including those covered by returns, required of
Seller for the Property (including, without limitation, for sales, use or
occupancy taxes) have been paid (and such returns filed) or, if not now due,
will be paid (and such returns filed) by Seller in a timely manner and in good
faith. All taxes which are due as of the Closing Date have been paid, or in the
case of taxes due after the Closing Date, such taxes shown thereon shall be paid
by or on behalf of Seller in a timely manner.

      3.16 NO CONFLICT. Provided that the Lender's Prepayment Consent and the
Manager's Consent are obtained and remain effective, the execution and delivery
of this Agreement and the consummation of the transactions contemplated herein
will not conflict with, breach, result in a default under, or violate any
commitment, document or instrument to which Seller is a party or by which it is
bound, which would preclude the performance of Seller's obligations hereunder.

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      3.17 TAXES AND ASSESSMENTS. Seller has not received written notice from
any applicable governmental authority of a proceeding or intention to create any
new assessment district that would include the Resort or any part thereof.

      3.18 EMPLOYEE MATTERS. Seller does not have any employees at the Property.
Further, all obligations for Resort employees for which Seller is responsible
under the Management Agreements shall be discharged and fully paid, or prorated
in accordance with the provisions of Article XIII hereof, as of the Closing
Date.

      3.19 INSURANCE COMPANY NOTICES. Neither Seller nor to Seller's knowledge,
Manager, has received written notice from any insurance company of any defects
or inadequacies in the Resort that any such insurance company has advised Seller
or to Seller's knowledge, Manager, if not corrected would result in a
termination of the existing insurance coverage with respect to the Resort or any
material increase in the premiums payable thereunder.

      3.20 DEVELOPER/DECLARANT RIGHTS/AMENDMENTS. Except pursuant to materials
that have been provided to Purchaser as described in Section 3.23(d), Seller has
not assigned any of its rights or interests as Developer (as defined in the
Stormwater Management System Declaration) in and to the Stormwater Management
System Declaration or as Declarant (as defined in the Master Declaration) under
the Master Declaration. Further, except as described in the Title Commitment or
other materials provided to Purchaser, the Master Declaration and Stormwater
Management System Declaration have not been amended or modified since their
execution. The Architectural Design Standards and Guidelines (as defined in the
Master Declaration) have not been agreed to or approved by Seller.

      3.21 OCCASIONAL SALE EXCEPTION. With respect to any sales tax that might
otherwise be due in connection with the sale and transfer of any Personal
Property, Seller represents and warrants that (i) as of the Closing Date, Seller
will not have made or consummated more than one (1) sale or series of sales of
any FF&E, Fixed Asset Supplies or Inventories within the prior twelve (12) month
period, and (ii) as of the Closing Date, Seller will have paid all applicable
Florida sales or use tax on its purchase of all FF&E, Fixed Asset Supplies or
Inventories prior to the Closing Date.

      3.22 SURVEY. To Seller's knowledge, except for work relating to the
"parking lot turn around" at the JW Marriott and work performed in connection
with the project described in the Development Agreement, since the date of that
certain ALTA/ACSM Land Title Survey prepared by Donald W. McIntosh Associates,
Inc. dated March 21, 2005 (17 pages) (the "SURVEY"), no work has been undertaken
by

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or on behalf of Seller at the Resort which would cause additional exceptions to
be shown on a survey which are not otherwise shown on the Survey.

      3.23 CERTAIN LIMITATIONS ON SELLER'S REPRESENTATIONS AND WARRANTIES. The
representations and warranties of Seller set forth in this Article III are
subject to the following express limitations:

            (a) The expiration or termination of any Space Lease, Equipment
Lease, Rooms Agreement or Service Contract shall not affect the obligations of
Purchaser hereunder or render any representation or warranty of Seller untrue;

            (b) To the extent that Purchaser knows or is "deemed to know" prior
to the Closing Date that Seller's representations and warranties are inaccurate,
untrue or incorrect in any way, and Purchaser nevertheless proceeds with the
consummation of the Closing, such representations and warranties shall be deemed
modified to reflect Purchaser's knowledge or deemed knowledge, as the case may
be, and Purchaser shall not be entitled to assert a claim for breach thereof by
Seller following Closing. For purposes of this Agreement, Purchaser shall be
"deemed to know" that a representation or warranty is untrue, inaccurate or
incorrect to the extent that this Agreement, the due diligence materials
provided to Purchaser as described in Section 3.23(d), any title commitment
obtained by Purchaser, any updated Survey or new survey, any UCC search obtained
by Purchaser, or studies, tests, reports, or analyses prepared by or for
Purchaser or any of its employees, agents, representatives or attorneys contain
information that is inconsistent with such representation or warranty.

            (c) For purposes of this Agreement, "to Seller's knowledge", "to the
knowledge of Seller", or "known to Seller" (or words of similar meaning) shall
mean to the actual knowledge of Lee Pillsbury, Carroll Warfield, Martin Reid,
David Weymer and George Dabney, after due inquiry of Marc Hoffman, the managing
director of the Resort, but otherwise without independent investigation or
inquiry by such individual and without any imputation to such individual or to
Seller whatsoever.

            (d) For purposes of this Agreement, any document shall be deemed to
have been provided by Seller to Purchaser if such materials have been provided
to Purchaser at the Property, directly provided to Purchaser, or posted on the
website of the Broker; and

            (e) Seller's liability shall be limited as set forth in Section
14.7.

                                       10
<PAGE>

                                   ARTICLE IV
              PURCHASER'S REPRESENTATIONS, WARRANTIES AND COVENANTS

      In order to induce Seller to enter into this Agreement and to consummate
the transactions contemplated hereby, Purchaser represents and warrants to, and
covenants with, Seller as follows:

      4.1 GOOD STANDING. Purchaser is a corporation duly organized, and legally
and validly existing and in good standing under the laws of Maryland and is, or
as of the Closing Date shall be, qualified to do business in the State of
Florida.

      4.2 DUE AUTHORIZATION. The execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby have been
authorized by all requisite corporate actions of Purchaser (none of which
actions have been modified or rescinded, and all of which actions are in full
force and effect). The individuals executing this Agreement on behalf of
Purchaser have full power and authority to do so. This Agreement constitutes a
valid and binding obligation of Purchaser, enforceable against Purchaser in
accordance with its terms.

      4.3 LITIGATION. There are no actions, suits, arbitrations, governmental
investigations, bankruptcy or execution proceedings or other proceedings pending
or, to Purchaser's knowledge, threatened against Purchaser before any court or
governmental authority which would have a material adverse effect on Purchaser's
ability to enter into, or perform its obligations under, this Agreement.

      4.4 MONEY LAUNDERING. (a) Purchaser, its principal partners, principal
investors, principal shareholders and affiliates are not in violation of any
Anti-Money Laundering and Anti-Terrorism Laws.

            (b) Purchaser, its principal partners, principal investors,
principal shareholders and affiliates are not acting, directly or indirectly, on
behalf of terrorists, terrorist organizations or narcotics traffickers,
including, without limitation, those persons or entities that appear on the
Annex to the Executive Order, or are included on any relevant lists maintained
by the Office of Foreign Assets Control of U.S. Department of Treasury, U.S.
Department of State, or other U.S. government agencies, all as may be amended
from time to time.

            (c) Purchaser, its principal partners, principal investors,
principal shareholders or affiliates and, without inquiry, its brokers or other
agents, in any capacity in connection with the purchase of Property (i) do not
conduct any business or engage in making or receiving any contribution of funds,
goods or services to or for the benefit of any person included in the lists set
forth in the preceding paragraph; (ii) do not deal in, or otherwise engage in
any transaction relating to, any property or interests in property blocked
pursuant to the Executive Order; or

                                       11
<PAGE>

(iii) do not engage in or conspire to engage in any transaction that evades or
avoids, or has the purpose of evading or avoiding, or attempts to violate, any
of the prohibitions set forth in any Anti-Money Laundering and Anti-Terrorism
Laws.

            (d) Purchaser understands and acknowledges that Seller may become
subject to further anti-money laundering regulations, and agrees to execute
instruments, provide information, or perform any other acts as may reasonably be
requested by Seller, for the purpose of: (i) carrying out due diligence as may
be required by applicable law to establish Purchaser's identity and source of
funds; (ii) maintaining records of such identities and sources of funds, or
verifications or certifications as to the same; and (iii) taking any other
actions as may be required to comply with and remain in compliance with
anti-money laundering regulations applicable to Purchaser.

            (e) Neither Purchaser, nor any person controlling or controlled by
Purchaser, is a country, territory, individual or entity named on a Government
List, and the monies used in connection with this Agreement and amounts
committed with respect thereto, were not and are not derived from any activities
that contravene any applicable anti-money laundering or anti bribery laws and
regulations (including, without limitation, funds being derived from any person,
entity, country or territory on a Government List or engaged in any unlawful
activity defined under 18 USC Section 1956(c)(7)).

            4.5 PURCHASER'S KNOWLEDGE. For purposes of this Article IV, "to
Purchaser's knowledge", "to the knowledge of Purchaser", or "known to Purchaser"
(or words of similar meaning) shall mean to the actual knowledge of Marcel
Verbaas, without independent investigation or inquiry by such individual and
without any imputation to such individual or to Purchaser whatsoever.

            4.6 DISCLAIMERS. (a)PURCHASER ACKNOWLEDGES THAT IT HAS HAD TIME TO
INSPECT, EXAMINE AND INVESTIGATE THE PROPERTY AND TO REVIEW THE DUE DILIGENCE
DATA RELATING THERETO. EXCEPT AS OTHERWISE PROVIDED IN THIS AGREEMENT, PURCHASER
REPRESENTS, WARRANTS AND AGREES THAT PURCHASER IS RELYING SOLELY ON ITS OWN
INSPECTIONS, EXAMINATIONS AND INVESTIGATIONS AND SELLER'S REPRESENTATIONS
EXPRESSLY SET FORTH IN THIS AGREEMENT IN MAKING THE DECISION TO PURCHASE THE
PROPERTY.

            (b) PURCHASER IS PURCHASING THE PROPERTY IN ITS "AS IS" CONDITION
"WITH ALL FAULTS" AND WITHOUT ANY WARRANTIES, REPRESENTATIONS OR GUARANTIES OF
ANY KIND, ORAL OR WRITTEN, EXPRESS OR IMPLIED, CONCERNING THE PROPERTY FROM OR
ON BEHALF OF SELLER EXCEPT AS MAY BE EXPRESSLY SET FORTH HEREIN

                                       12
<PAGE>

OR ON THE EXHIBITS ATTACHED HERETO. PURCHASER ACKNOWLEDGES THAT, EXCEPT AS MAY
BE EXPRESSLY SET FORTH HEREIN OR ON THE EXHIBITS ATTACHED HERETO, SELLER HAS
NOT, DOES NOT AND WILL NOT MAKE ANY REPRESENTATIONS, WARRANTIES OR GUARANTIES,
OF ANY KIND, ORAL OR WRITTEN, EXPRESS OR IMPLIED, CONCERNING THE PROPERTY,
INCLUDING, WITHOUT LIMITATION, (I) THE STRUCTURAL ELEMENTS, FOUNDATIONS, ROOFS,
APPURTENANCES, ACCESS, LANDSCAPING, PARKING FACILITIES, ELECTRICAL, MECHANICAL,
HVAC, PLUMBING, SEWAGE OR UTILITY SYSTEMS, FACILITIES OR APPLIANCES ON THE REAL
ESTATE OR ANY PORTION THEREOF, (II) THE QUALITY, NATURE, ADEQUACY OR PHYSICAL
CONDITION OF SOILS OR GROUND WATER AT OR UNDER THE LAND, (III) THE EXISTENCE,
QUALITY, NATURE, ADEQUACY OR PHYSICAL CONDITION OF ANY UTILITY SERVING THE
PROPERTY, (IV) THE PROPERTY TAXES NOW OR HEREAFTER PAYABLE ON THE PROPERTY OR
THE VALUATION OF THE PROPERTY FOR PROPERTY TAX PURPOSES, (V) THE DEVELOPMENT
POTENTIAL OF THE PROPERTY OR THE HABITABILITY, MERCHANTABILITY OR FITNESS,
SUITABILITY OR ADEQUACY OF THE PROPERTY OR ANY PORTION THEREOF FOR ANY
PARTICULAR USE OR PURPOSE, (VI) THE ZONING OR OTHER LEGAL STATUS OF THE
PROPERTY, (VII) THE COMPLIANCE BY THE PROPERTY OR OF THE BUSINESS CONDUCTED
THEREON, OR ANY PORTION THEREOF, WITH ANY APPLICABLE CODES, LAWS, REGULATIONS,
STATUTES, ORDINANCES, COVENANTS, CONDITIONS OR RESTRICTIONS OF ANY GOVERNMENTAL
OR QUASI-GOVERNMENTAL ENTITY OR OF ANY OTHER PERSON OR ENTITY, (VIII) THE
QUALITY OF ANY LABOR OR MATERIALS RELATING IN ANY MANNER TO THE PROPERTY, (IX)
THE CONDITION OF TITLE TO THE PROPERTY OR THE NATURE, STATUS AND EXTENT OF ANY
LEASE, ENCUMBRANCE OR OTHER MATTER AFFECTING TITLE TO THE PROPERTY, OR (X) THE
ENVIRONMENTAL CONDITION OF THE PROPERTY, INCLUDING, WITHOUT LIMITATION, ITS
COMPLIANCE WITH ENVIRONMENTAL LAWS AND THE PRESENCE OR ABSENCE OF HAZARDOUS
SUBSTANCES.

            (c) PURCHASER AGREES THAT SELLER SHALL NOT BE LIABLE TO PURCHASER
FOR ANY PROSPECTIVE OR SPECULATIVE PROFITS, OR SPECIAL, INDIRECT OR
CONSEQUENTIAL DAMAGES, WHETHER BASED UPON CONTRACT, TORT OR NEGLIGENCE OR IN ANY
OTHER MANNER ARISING FROM THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY
THIS AGREEMENT. THE PROVISIONS OF THIS SECTION 4.6 SHALL SURVIVE CLOSING OR ANY
TERMINATION OF THIS AGREEMENT.

                                    ARTICLE V
                                     CLOSING

                                       13
<PAGE>

      5.1 CLOSING. The consummation of the purchase and sale of the Property as
contemplated by this Agreement (the "CLOSING") shall take place at 10:00 a.m. on
February 24, 2006 (the "CLOSING DATE") at the offices of Lowndes, Drosdick,
Doster, Kantor & Reed, P.A., 215 N. Eola Drive, Orlando, Florida 32801. All of
Seller's deliveries and the Purchase Price shall be delivered in escrow to the
Escrow Agent. All transactions at the Closing shall be interdependent and are to
be considered simultaneous, so that none are effective until all are effective.

      5.2 COSTS. Seller shall pay for the documentary stamp taxes and recording
fees for the Deed associated with the Closing. Purchaser shall pay for (i) title
insurance (including any title premiums) and the cost to update the Survey, (ii)
all intangible taxes and documentary stamp taxes payable in connection with any
mortgage obtained by Purchaser, (iii) all other costs associated with its
financing, and (iv) all costs associated with its due diligence review of the
Property. In connection with the prepayment and termination of that certain loan
to Seller by Barclays Capital Real Estate Inc. ("LENDER") in the original
principal amount of Four Hundred Million Dollars ($400,000,000.00) (the
"EXISTING LOAN"), Purchaser also agrees to pay the actual prepayment penalty
incurred by Seller with respect to the prepayment and termination of the
Existing Loan, up to two percent (2%) of the outstanding loan balance as of the
Closing Date, not to exceed Eight Million Dollars ($8,000,000.00) (the
"PURCHASER LOAN TERMINATION COST"); Seller shall pay any remaining costs
relating to the prepayment and termination of the Existing Loan. Each party
shall pay its own attorneys' fees incurred in connection with this transaction.

                                   ARTICLE VI
                             ACTIONS PENDING CLOSING

      6.1 CONDUCT OF BUSINESS; MAINTENANCE AND OPERATION OF PROPERTY. Between
the Contract Date and the Closing Date, Seller shall use commercially reasonable
efforts to cause the operation and maintenance of the Property to be carried on
in the ordinary course, in a manner consistent with prior practice. Seller or
Manager shall be permitted to enter into those pending equipment leases, service
contracts and rooms agreements identified on EXHIBIT M hereto (the "PENDING
CONTRACTS"), without the consent of Purchaser. To the extent Seller has consent
rights under the Management Agreements, Seller shall not consent to the
termination or material modification of any existing Equipment Leases, Service
Contracts, Rooms Agreements or Space Leases or enter into new equipment leases,
service contracts, rooms agreements or space leases without the prior written
consent of Purchaser, which shall not be unreasonably withheld, conditioned or
delayed. If Purchaser fails to respond to a request for consent within five (5)
business days after receipt of such request (or, if the Management Agreement
requires Seller's consent in a shorter period, one (1) business day prior to the

                                       14
<PAGE>

expiration of such shorter period), such consent shall be deemed given. Seller
agrees to contact Purchaser to request its consent promptly after receiving
notice from Manager that it intends to terminate or materially modify any
Equipment Leases, Service Contracts, Rooms Agreements or Space Leases or enter
into any new equipment leases, service contracts, rooms agreements or space
leases, all limited to the extent Seller has any consent rights under the
Management Agreements. Seller shall provide Purchaser with copies of any
terminations, modifications or new leases or agreements promptly after the
execution thereof. Except in the ordinary course of business, Seller shall not
remove or permit to be removed any Personal Property except as necessary for
repairs or replacements of worn out or obsolete items. For purposes of this
Agreement, "ORDINARY COURSE" means the course of day-to-day operation of the
Resort in a manner which does not materially vary from the policies, practices
and procedures which have characterized its operation during the twelve (12)
months preceding the date hereof, in all events consistent with the applicable
Business Plans and Business Estimates (as each is defined in the Management
Agreements).

      6.2 TITLE. (a) Except as expressly permitted in this Agreement, the
Property shall be sold, assigned and conveyed by Seller to Purchaser, and
Purchaser shall accept the Property, subject only to the items listed on EXHIBIT
J attached hereto (the "PERMITTED EXCEPTIONS").

            (b) Prior to the Closing Date, Seller may use reasonable efforts to
obtain an amendment and restatement of that certain Settlement Agreement by and
among Manager, Williamsburg Commercial Limited Partnership and John Young &
Central Florida Parkway, LLC dated as of December 2003 (the "SETTLEMENT
AGREEMENT"), solely for the purposes of (i) conforming the Settlement Agreement
to the recording requirements of Orange County, Florida, and (ii) reflecting
that certain Amendment to Development Agreement among the parties dated March 2,
1993 in the recitals (the "AMENDED SETTLEMENT AGREEMENT"), and if obtained,
Seller may record the Amended Settlement Agreement in the Official Records of
Orange County, Florida, whereupon it shall constitute a Permitted Exception, to
the extent that it affects the Property.

      6.3 NO ACTION. Between the Contract Date and the Closing Date, Seller
shall not take or permit any action that would cause any representation or
warranty provided by Seller under this Agreement to be untrue in any material
respect as of the Closing Date. Between the Contract Date and the Closing Date,
to the extent that Seller has any consent rights thereunder, Seller will not
approve any proposed feasibility or business plan for development of any portion
of the land encumbered by that certain Declaration of Covenants, Conditions,
Restrictions, Easements and Reservations for Grande Lakes Resort recorded on
August 6, 2004, in Official Records Book 7568, Page 1177, Public Records of
Orange County, Florida

                                       15
<PAGE>

(the "MASTER DECLARATION"), without Purchaser's prior consent and approval, not
to be unreasonably withheld, conditioned or delayed.

      6.4 COOPERATION. Seller at its cost and expense, shall cooperate
reasonably with Purchaser in facilitating or securing the transfer or issuance
of any Permits or licenses necessary to permit the lawful, continuous operation
of the Property by Purchaser immediately following the Closing Date.

      6.5 CONSENT OF MANAGER. At least two (2) days prior to the end of the
Feasibility Period, Seller shall notify Purchaser in writing if Manager has (i)
consented to the "Sale of the Hotel" (as such term is defined in each of the
Management Agreements for the JW Marriott and the Ritz-Carlton), and the "Sale
of the Golf Course" (as such term is defined in the Management Agreement for the
Golf Club) pursuant to Section 10.02.C.1 of the Management Agreements, and (ii)
waived its right of first negotiation with respect to the JW Marriott, the
Ritz-Carlton and the Golf Club pursuant to Section 10.02.B of the Management
Agreements (the "MANAGER'S Consent"). If Seller fails to notify Purchaser in
writing that it has obtained the Manager's Consent at least two (2) days prior
to the expiration of the Feasibility Period, then either party may terminate
this Agreement prior to the expiration of the Feasibility Period. If the
Agreement is terminated pursuant to this Section 6.5, the Deposit shall be
returned immediately to Purchaser and neither party shall have any further
liability to the other under the Agreement, except as expressly set forth
herein. If Seller notifies Purchaser that it has obtained the Manager's Consent
prior to the expiration of the Feasibility Period, provided that Purchaser does
not deliver a Termination Notice pursuant to Section 6.7(b) hereof, Seller shall
deliver Manager's signature to an Assignment and Assumption of Management
Agreements substantially in the form of EXHIBIT V hereto at Closing, subject to
recordation of the Amendment to Declaration.

      6.6 LIQUOR LICENSE. Promptly following the Contract Date, Purchaser shall,
to the extent required by applicable law, make any required application to the
appropriate governmental authorities to indicate a transfer in ownership of the
Property, as the same pertains to the continuing validity of the liquor licenses
for the Resort, and Seller shall, at Seller's cost and expense, cooperate with
Purchaser in this regard.

      6.7 INSPECTION; FEASIBILITY PERIOD. (a) Purchaser shall have the right,
upon reasonable notice to Seller, at its own risk, cost and expense and at any
date or dates prior to Closing, to enter, or cause its agents or representatives
to enter, upon the Property for the purpose of making surveys or other tests,
test borings, inspections, investigations and/or studies of the Property. In
addition, Purchaser may conduct such architectural, structural, environmental,
economic and other studies of the Property as Purchaser may, in its sole
discretion, deem desirable. Purchaser shall not make any physical alterations to
the Property, such entry shall

                                       16
<PAGE>

not unreasonably interfere with the guests or management of the Property, and
Purchaser shall indemnify and hold Seller harmless from any cost, claim or
expense in connection therewith (which indemnification shall survive the Closing
or earlier termination of this Agreement), except that Purchaser's obligations
as set forth in this sentence shall not extend to previously existing conditions
that are discovered by Purchaser to be present on, under or about the Property.
Purchaser shall have complete access to all documentation, agreements and other
information in the possession of Seller or Seller's agents related to the
Property, as well as any documents at the Property to which Seller has access
(which Seller may, in lieu of delivery to Purchaser, post on the Broker's
website) and shall have the right to make copies of same. Seller also shall
permit Purchaser to contact certain personnel employed by Manager at the Resort
upon not less than two (2) days advance request to Seller. Seller shall permit
Purchaser, its agents and employees, reasonable use of complimentary rooms at
the Property and food and beverage services at cost (subject to availability).
If Purchaser elects to terminate this Agreement pursuant to Section 6.7(b),
Purchaser agrees to supply Seller with the results of any tests, studies or
inspections of the Property performed hereunder, within five (5) days of such
termination.

            (b) If, during the period between the Contract Date and 5 p.m.
Eastern time on December 30, 2005 (the "FEASIBILITY PERIOD"), Purchaser gives
Seller written notification (the "TERMINATION NOTICE") that Purchaser elects not
to consummate the purchase of the Property in accordance with the terms of this
Agreement, this Agreement shall terminate, and the Deposit shall be returned
immediately to Purchaser. Purchaser shall have the absolute right, in its sole
discretion without a duty to exercise good faith, to determine whether to give
the Termination Notice. If the Termination Notice is given, the Deposit shall be
returned immediately to Purchaser and neither party shall have any further
liability to the other under this Agreement, except as expressly set forth
herein. If Purchaser elects not to give the Termination Notice prior to the
expiration of the Feasibility Period, this Agreement shall remain in full force
and effect.

      6.8 EXISTING LOAN. Prior to the expiration of the Feasibility Period,
Seller and Purchaser shall cooperate in obtaining Lender's written approval of
the prepayment and termination of the Existing Loan ("LENDER'S PREPAYMENT
CONSENT") as of the Closing Date. If Seller or Purchaser fail to obtain the
Lender's Prepayment Consent prior to the expiration of the Feasibility Period,
then either party may terminate this Agreement prior to the expiration of the
Feasibility Period. If the Agreement is terminated pursuant to this Section 6.8,
the Deposit shall be returned immediately to Purchaser and neither party shall
have any further liability to the other under the Agreement, except as expressly
set forth herein.

                                       17
<PAGE>

      6.9 RITZ-CARLTON BALLROOM DEVELOPMENT. Seller has entered into a
Development Agreement (the "DEVELOPMENT AGREEMENT") dated as of December 16,
2005 with Marriott International Design & Construction Services, Inc. ("MARRIOTT
DESIGN"), which Development Agreement will provide for construction of a
ballroom adjacent to, and to form a part of, the Ritz-Carlton. Seller agrees to
comply with the terms of the Development Agreement, including all budgets and
work schedules adopted pursuant thereto. To the extent Seller has consent rights
under the Development Agreement, after the expiration of the Feasibility Period,
Seller shall not grant any such consents without the prior written consent of
Purchaser, which shall not be unreasonably withheld, conditioned or delayed. If
Purchaser fails to respond to a request for consent within five (5) business
days after receipt of such request (or if the Development Agreement requires
Seller's consent in a shorter period, one (1) business day prior to the
expiration of such shorter period), such consent shall be deemed given. Seller
agrees to contact Purchaser to request its consent promptly after receiving
notice from Marriott Design requesting Seller's consent under the Development
Agreement, to the extent Seller has any consent rights under the Development
Agreement. Seller shall pay all costs incurred under the Development Agreement
prior to Closing. On the Closing Date, Seller shall provide Purchaser with
reasonably available evidence of costs incurred and amounts paid by or on behalf
of Seller (including amounts disbursed from the FF&E Reserves) under the
Development Agreement through the Closing Date. Purchaser agrees to assume all
obligations under the Development Agreement from and after the Closing Date,
subject to the limitation set forth in Section 13.9.

      6.10 OTHER CAPITAL PROJECTS. From the Contract Date until the Closing
Date, Seller agrees to diligently continue to work in the ordinary course of
business on those capital projects set forth on EXHIBIT L attached hereto (the
"CAPITAL PROJECTS"). Seller shall pay all costs incurred for the Capital
Projects prior to Closing. On the Closing Date, Seller shall provide Purchaser
with reasonably available evidence of costs incurred and amounts paid by or on
behalf of Seller (including amounts disbursed from the FF&E Reserves) on the
Capital Projects through the Closing Date. At Closing, Purchaser shall assume
the responsibility for the costs and completion of the Capital Projects, subject
to the limitation set forth in Section 13.9.

      6.11 BUSINESS PLAN; BUILDING ESTIMATES. During the Feasibility Period,
Seller agrees to provide Purchaser with (a) copies of the preliminary Business
Plans (as defined in the Management Agreements) for the Resort for fiscal year
2006, as well as any revisions thereto, minutes of the Business Plan review
meetings, and the final Business Plan for fiscal year 2006, as applicable
(collectively, the "2006 BUSINESS PLAN") and (b) the Building Estimates (as
defined in the Management Agreements) and all other budgets, if any, for the
Resort for fiscal year 2006 (the "2006 BUILDING ESTIMATE"). After the expiration
of the Feasibility Period, if either

                                       18
<PAGE>

of the 2006 Business Plan or 2006 Building Estimate is not in final form, Seller
shall not approve the 2006 Business Plan or 2006 Building Estimate without the
consent of Purchaser, such consent not to be unreasonably withheld, conditioned
or delayed. After the expiration of the Feasibility Period, Seller shall not
make any revisions to the 2006 Business Plan or the 2006 Building Estimate,
without the approval of Purchaser (subject to any limitations on Seller's
approval rights under the Management Agreements), such approval not to be
unreasonably withheld, conditioned or delayed. Purchaser agrees to notify Seller
in writing within ten (10) days after its receipt of the final 2006 Business
Plan or final 2006 Building Estimate, or the proposed modifications to the 2006
Business Plan or 2006 Building Estimate, as applicable, of either its approval
or disapproval thereof. If Purchaser fails to notify Seller in writing of its
approval or disapproval within the ten (10) day period set forth above,
Purchaser shall be deemed to have approved the final 2006 Business Plan or final
2006 Building Estimate, or such modification to the 2006 Business Plan or 2006
Building Estimate, as applicable.

      6.12 DECLARATION OF COVENANTS, CONDITIONS, RESTRICTIONS, EASEMENTS AND
RESERVATIONS AFFECTING Property. (a) The Property is encumbered by that certain
Declaration of Covenants, Conditions, Restrictions, Easements and Reservations
for Grande Lakes Master Stormwater Management System recorded on August 7, 2003,
in Official Records Book 7038, Page 2091, Public Records of Orange County,
Florida (the "STORMWATER MANAGEMENT SYSTEM DECLARATION"), as well as the Master
Declaration. Seller is one of the "Developers" (as defined in the Stormwater
Management System Declaration) under the Stormwater Management System
Declaration. Seller shall deliver to Purchaser at Closing an estoppel
certificate from Grande Lakes Stormwater Management Association, Inc. (as
defined in the Stormwater Management System Declaration) certifying to Purchaser
and any mortgagee of Purchaser the current amounts of any Assessments (as
defined in the Stormwater Management System Declaration) or other payments that
are payable by Seller with respect to the Property, the date to which any such
payments have been paid and that no default exists by Seller under the
Stormwater Management System Declaration.

            (b) Seller is the "Declarant" (as defined in the Master Declaration)
under the Master Declaration. Seller shall deliver to Purchaser at Closing, (i)
an estoppel certificate from Resort Manager, the Association and, to the extent
reasonably available, each Owner (as those terms are defined in the Master
Declaration) as to those matters set forth in Section 3.6 of the Master
Declaration and (ii) a Certificate of Assessments Due from the Association with
respect to the matters set forth in Section 11.22 of the Master Declaration.
Between the Contract Date and the Closing Date, Seller shall not approve any
Architectural Design Standards and Guidelines without Purchaser's consent, which
consent shall not be unreasonably withheld, conditioned or delayed. Between the
Contract Date and the Closing Date, Seller shall not assign Seller's rights as
"Developer" or "Declarant," as

                                       19
<PAGE>

applicable, or consent to the amendment of either the Stormwater Management
System Declaration or the Master Declaration, without Purchaser's prior written
consent, which consent shall not be unreasonably withheld, conditioned or
delayed. Notwithstanding the foregoing or any other provision of this Agreement,
immediately prior to Closing, Seller shall be entitled to record an amendment to
the Master Declaration, in the form attached hereto as EXHIBIT DD (the
"AMENDMENT TO DECLARATION"), or such other form as Manager and Purchaser agree
in a writing delivered to Seller as mutually acceptable to them and such
Amendment to Declaration shall constitute a Permitted Exception.

            (c) Seller shall assign to Purchaser all of Seller's rights and
interests as Developer under the Stormwater Management System Declaration and as
Declarant under the Master Declaration in the Deed.

                                   ARTICLE VII
                   PURCHASER'S CONDITIONS PRECEDENT TO CLOSING

      It shall be an express precondition to Purchaser's obligation to purchase
the Property that each and every one of the following conditions shall have been
satisfied as of the Closing Date (or waived by Purchaser).

      7.1 REPRESENTATIONS AND WARRANTIES. Each of Seller's representations and
warranties which is not qualified by "materiality" shall be true and accurate in
all material respects as if made on and as of the Closing Date. Each of Seller's
representations and warranties which is qualified by "materiality" shall be true
and accurate in all respects as if made on and as of the Closing Date.

      7.2 COVENANTS OF SELLER. All actions Seller covenants herein to take shall
have been completed.

      7.3 MANAGER'S CONSENT. Seller shall have obtained the Manager's Consent.

      7.4 MARRIOTT DESIGN'S CONSENT. Marriott Design shall have consented to the
assignment of the Development Agreement to Purchaser, to the extent any consent
is required thereunder.

      7.5 TITLE. Purchaser shall be able to obtain a policy of title insurance
(ALTA 1992 Form) in the amount of the Purchase Price and issued pursuant to the
Title Commitment, subject only to the Permitted Exceptions.

      7.6 LOAN TERMINATION. The Lender shall have agreed to a prepayment and
termination of the Existing Loan.

                                       20
<PAGE>

      7.7 TERMINATION OF OPERATING LEASES. Seller shall have terminated any and
all operating leases (the "OPERATING LEASES") to which Seller and THI III GL
Lessee, L.L.C. (the "OPERATING LESSEE") are a party which affect any or all of
the Property.

      7.8 EXECUTION OF CLOSING DOCUMENTS BY OPERATING LESSEE. To the extent that
Operating Lessee is the owner or holder of any right, title or interest in and
to any portion of the Property, Seller shall cause Operating Lessee to execute
and deliver the appropriate document or instrument, as provided in Article IX of
this Agreement, transferring, conveying and/or assigning such Personal Property
to Seller.

      7.9 TERMINATION OF OTHER AGREEMENTS WITH MANAGER. Seller shall have
terminated (or shall terminate concurrently with Closing) all agreements between
Seller (or Operating Lessee, if applicable) and Manager other than the
Management Agreements and Seller's organizational documents (the latter of which
shall have no effect on Purchaser or the Property).

                                  ARTICLE VIII
                    SELLER'S CONDITIONS PRECEDENT TO CLOSING

      It shall be an express precondition to Seller's obligation to convey the
Property that each and every one of the following conditions shall have been
satisfied as of the Closing Date (or waived by Seller).

      8.1 REPRESENTATIONS AND WARRANTIES. Each of Purchaser's representations
and warranties shall be true and accurate in all material respects as if made on
and as of the Closing Date.

      8.2 COVENANTS OF PURCHASER. All actions Purchaser covenants herein to take
shall have been completed.

      8.3 MANAGER'S CONSENT. Seller shall have obtained the Manager's Consent.

      8.4 MARRIOTT DESIGN'S CONSENT. Marriott Design shall have consented to the
assignment of the Development Agreement to Purchaser, to the extent any consent
is required thereunder.

      8.5 PURCHASE PRICE. Purchaser shall be able to deliver the Purchase Price.

      8.6 LOAN TERMINATION. The Lender shall have agreed to a prepayment and
termination of the Existing Loan, and to unconditionally and irrevocably release
Seller and its affiliates from all obligations and guaranties thereunder.

                                       21
<PAGE>

                                   ARTICLE IX
                               CLOSING DELIVERIES

      9.1 DEED. Seller shall execute and deliver a special warranty deed in
recordable form, substantially in the form attached as EXHIBIT O, conveying
Seller's fee simple interest in the Resort (the "DEED"), dated as of the Closing
Date, free of all encumbrances other than the Permitted Exceptions conveying to
Purchaser fee simple interest in the Resort as required hereunder.

      9.2 BILL OF SALE. Seller and Purchaser each shall execute and deliver a
bill of sale substantially in the form attached hereto as EXHIBIT P, dated as of
the Closing Date, pursuant to which Seller shall convey to Purchaser that
portion of the Personal Property for which a bill of sale transfers title, free
of all encumbrances other than the Permitted Exceptions, and Seller shall
further execute and deliver to Buyer such certificates of title as are required
to vest title in Purchaser with respect to any vehicles comprising Personal
Property.

      9.3 ASSIGNMENT OF PERMITS AND INTANGIBLE PROPERTY. Seller shall execute
and deliver an assignment of all Permits and Intangible Property substantially
in the form attached hereto as EXHIBIT Q, pursuant to which Seller shall assign
to Purchaser all of Seller's right, title and interest in and to the Permits and
Intangible Property, if and to the extent assignable to Purchaser.

      9.4 ASSIGNMENT AND ASSUMPTION OF SERVICE CONTRACTS, ROOMS AGREEMENTS AND
EQUIPMENT LEASES. Seller and Purchaser each shall execute and deliver an
assignment and assumption of all Service Contracts, Rooms Agreements and
Equipment Leases substantially in the form attached hereto as EXHIBIT R,
pursuant to which Seller shall assign to Purchaser all of Seller's right, title
and interest in and to the Service Contracts, Rooms Agreements and Equipment
Leases and Purchaser shall assume from Seller all of Seller's obligations and
liabilities arising from and after the Apportionment Date with respect to the
Service Contracts, Rooms Agreement and Equipment Leases.

      9.5 ASSIGNMENT AND ASSUMPTION OF DEVELOPMENT AGREEMENT. Seller and
Purchaser each shall execute and deliver an assignment and assumption of the
Development Agreement substantially in the form attached hereto as EXHIBIT S,
pursuant to which Seller shall assign to Purchaser all of Seller's right, title
and interest in and to the Development Agreement and Purchaser shall assume from
Seller all of Seller's obligations and liabilities arising from and after the
Apportionment Date with respect to the Development Agreement. Seller shall
further deliver to Purchaser a consent to the foregoing assignment of the
Development Agreement executed by Marriott Design, to the extent required
thereunder.

                                       22
<PAGE>

      9.6 FIRPTA CERTIFICATE. Seller shall execute and deliver a certificate,
substantially in the form attached hereto as EXHIBIT U dated as of the Closing
Date, to establish that Seller is not a foreign person for the purposes of the
Foreign Investors in Real Property Tax Act.

      9.7 ASSIGNMENT AND ASSUMPTION OF MANAGEMENT AGREEMENTS. Seller and
Purchaser each shall deliver an executed assignment and assumption of the
Management Agreements substantially in the form attached hereto as EXHIBIT V
(the "MANAGEMENT AGREEMENT ASSIGNMENT"), pursuant to which Seller shall assign
to Purchaser all of Seller's right, title and interest in and to the Management
Agreements and Purchaser shall assume from Seller all of Seller's obligations
and liabilities arising from and after the Apportionment Date with respect to
the Management Agreements. Seller shall obtain and deliver Manager's signature
to the Management Agreement Assignment.

      9.8 ASSIGNMENT AND ASSUMPTION OF SPACE LEASES. Seller and Purchaser each
shall execute and deliver an assignment and assumption of the Space Leases
substantially in the form attached hereto as EXHIBIT W, pursuant to which Seller
shall assign to Purchaser all of Seller's right, title and interest in and to
the Space Leases and Purchaser shall assume from Seller all of Seller's
obligations and liabilities arising from and after the Apportionment Date with
respect to the Space Leases.

      9.9 TENANT NOTICES. Duly executed notices to each of the tenants under the
Space Leases, substantially in the form attached hereto as EXHIBIT X, addressed
to each of such tenants, which notices Purchaser shall, at Purchaser's sole cost
and expense, either mail to each such tenant by certified mail, return receipt
requested or hand-deliver to each such tenant.

      9.10 RESORT DOCUMENTS. To the extent they are then in Seller's possession,
and have not theretofore been delivered to Purchaser: (i) any plans and
specifications for the Resort; (ii) all unexpired warranties and guarantees
which Seller has received in connection with any work or services performed with
respect to, or equipment installed in, the Resort (collectively, the
"WARRANTIES"); (iii) originals of all Space Leases, all correspondence to or
from any tenants, relating to the Space Leases; (iv) originals of all Service
Contracts that will remain in effect after the Closing; (v) a list of advance
room reservations and functions; (vi) a list of such Seller's outstanding
accounts receivable as of midnight on the date prior to the Closing; (vii) all
Permits and licenses for the Property; and (which materials under this Section
9.10 may be either delivered at Closing or left at the management office at the
Resort).

                                       23
<PAGE>

      9.11 OTHER DOCUMENTS. Seller shall deliver such other documents and
instruments as may be reasonably requested by the Purchaser and Escrow Agent to
effectuate the transactions contemplated by this Agreement and to induce the
Escrow Agent to insure title to the Resort as described herein, including,
without limitation, an Owner's Affidavit substantially in the form attached
hereto as EXHIBIT T (the "OWNER'S AFFIDAVIT"), a Seller's Closing Certificate
substantially in the form of EXHIBIT Y (the "SELLER CLOSING CERTIFICATE"), the
estoppel certificates as set forth in Section 6.12 of this Agreement, an
assignment of all Warranties, and a Closing Statement. Purchaser shall also
deliver to Seller a Purchaser Closing Certificate substantially in the form of
EXHIBIT Z (the "PURCHASER CLOSING CERTIFICATE"), an assumption of all Warranties
and a Closing Statement.

      9.12 POSSESSION; KEYS. Seller shall deliver possession of the Property to
Purchaser, together with all keys, including, without limitation, keys for all
security systems, rooms and offices.

      9.13 PURCHASE PRICE. Purchaser shall deliver the Purchase Price.

      9.14 EVIDENCE OF TERMINATION. Seller shall deliver to Purchaser evidence
that the Operating Leases and Owner's Agreements have been terminated.

      9.15 ASSIGNMENTS AND ASSUMPTIONS OF DECLARATIONS. Seller and Purchaser
shall execute and deliver (i) an assignment and assumption of Seller's rights as
"Developer" under the Stormwater Management System Declaration and (ii) an
assignment and assumption of Seller's rights as "Declarant" under the Master
Declaration, substantially in the form attached hereto as EXHIBIT FF.

                                    ARTICLE X
                                     DEFAULT

      10.1 PURCHASER'S DEFAULT. If Purchaser fails to consummate the purchase
and sale contemplated herein after all conditions precedent to Purchaser's
obligation to do so have been satisfied or waived by Purchaser, or if Purchaser
otherwise fails to perform any of its obligations as and when required hereunder
prior to Closing, Escrow Agent shall pay the Deposit to Seller in accordance
with the Escrow Instructions, as full and complete liquidated damages, and as
the exclusive and sole right and remedy of Seller, whereupon this Agreement
shall terminate and neither party shall have any further obligations or
liabilities to the other party except for those expressly stated to survive the
termination of this Agreement.

      10.2 SELLER'S DEFAULT. If Seller breaches its representations, warranties,
covenants and/or agreements under this Agreement or has failed, refused or is
unable to consummate the purchase and sale contemplated herein by the Closing

                                       24
<PAGE>

Date, after all conditions to Seller's obligations set forth herein have been
satisfied or waived by Seller, Purchaser shall have the right to pursue either
one of the following: (a) to terminate this Agreement by notice to Seller and
Escrow Agent, whereupon the Deposit shall be returned to Purchaser by Escrow
Agent, and, in addition and to the extent that Purchaser shall have exercised
such right to terminate following a default by Seller under this Agreement,
Purchaser shall have the right to recover money damages from Seller in the
amount of Purchaser's third party costs incurred in connection with this
Agreement and the transactions contemplated hereby, not to exceed One Million
Dollars ($1,000,000.00), or (b) seek specific performance of this Agreement,
provided that any action or proceeding seeking such relief is commenced no later
than thirty (30) days after the contemplated Closing Date. Except as provided
above, Purchaser expressly waives its rights to seek damages in the event of
Seller's default hereunder, including, without limitation, consequential, or
punitive damages. Purchaser shall be deemed to have elected to terminate this
Agreement and receive back the Deposit if Purchaser fails to file suit for
specific performance against Seller in a court having jurisdiction in the county
and state in which the Property is located on or before thirty (30) days
following the date upon which Closing was to have occurred.

      10.3. NOTICE OF DEFAULT. Except for a party's failure to close on the
Closing Date, neither party shall have the right to declare a default by the
other party and exercise its remedies pursuant to this Article X unless the
defaulting party fails to cure such default within ten (10) days after written
notice of such default has been provided. Notwithstanding the foregoing, no cure
period shall extend beyond the scheduled Closing Date.

                                   ARTICLE XI
                                 INDEMNIFICATION

      11.1 SELLER'S INDEMNITY. Seller hereby agrees to defend, indemnify and
hold harmless Purchaser from and against any and all loss, damage, cost, claim,
liability or expense (including, without limitation, court costs and reasonable
attorneys' fees) suffered or incurred by Purchaser as a result of Seller's
failure to pay any accounts payable or any sales, use or occupancy taxes due in
connection with the rental of rooms, the sale of goods or the performance of
services prior to the Closing Date or for other liabilities of Seller arising or
accruing prior to the Closing Date, except (i) to the extent Purchaser has
received a credit therefor against the Purchase Price pursuant to this
Agreement, or (ii) Purchaser has expressly assumed such liabilities pursuant to
this Agreement.

      11.2 PURCHASER'S INDEMNITY. Purchaser hereby agrees to defend, indemnify
and hold harmless Seller from and against any and all loss, damage, cost, claim,
liability or expense (including, without limitation, court costs and reasonable

                                       25
<PAGE>

attorneys' fees) suffered or incurred by Seller arising after the Closing Date
out of any liability or obligation assumed by Purchaser hereunder or in any
agreement executed and/or delivered at the Closing, or resulting from
Purchaser's failure to pay any item for which it received a credit against the
Purchase Price under this Agreement.

      11.3 SURVIVAL. The provisions of this Article XI shall survive Closing
hereunder.

                                   ARTICLE XII
                            CASUALTY OR CONDEMNATION

      If, prior to Closing, (a) condemnation proceedings are commenced against
all or any material portion of the Property or (b) the Property is damaged by
fire or other casualty to the extent that the cost of repairing such damage
shall be Fifteen Million Dollars ($15,000,000) or more, Purchaser shall have the
right, upon notice in writing to the Seller delivered within fifteen (15) days
after actual notice of such condemnation, fire or other casualty, to terminate
this Agreement, whereupon the Deposit shall be returned immediately to
Purchaser, and neither party shall have any further liability to the other
hereunder except for those liabilities which expressly survive the termination
hereof. If Purchaser does not elect to terminate this Agreement, or if the cost
of repairing such damage is less than Fifteen Million Dollars ($15,000,000), the
Purchase Price shall not be reduced except as hereinafter set forth, but
Purchaser shall be entitled to an assignment of all of Seller's share of the
proceeds of fire or other casualty insurance proceeds (if any) payable with
respect to the period after Closing or of the condemnation award, as the case
may be, and Seller shall have no obligation to repair or restore the Property;
provided, however, that the Purchase Price shall be reduced by an amount equal
to the sum of (a) any uninsured or unreimbursed amount, (b) the "deductible"
applied by Seller's insurer with respect to such fire or casualty and (c) the
amount by which the proceeds of such insurance will be reduced by reason of the
application of any co-insurance clause in Seller's insurance policy. If
Purchaser proceeds to Closing hereunder, Seller shall not compromise, settle or
adjust any claims to such proceeds or awards, without Purchaser's prior written
consent, which shall not be unreasonably withheld, conditioned or delayed.

                                  ARTICLE XIII
                                 APPORTIONMENTS

      13.1 APPORTIONMENTS. The following apportionments shall be made between
the parties at the Closing as of 11:59 p.m. on the day immediately prior to the
Closing Date (the "APPORTIONMENT DATE").

                                       26
<PAGE>

            (a) real estate taxes (based upon 2005 taxes, excise taxes, to be
adjusted within thirty (30) days after receipt of the 2006 tax bill), personal
property taxes, special assessments and vault charges, if any, on the basis of
the fiscal period for which assessed; provided, however, that Seller is
contesting certain personal property taxes from 2004 and 2005 (the "TAX
APPEAL"), at its own expense, and Purchaser agrees that Seller shall be entitled
to continue to prosecute the Tax Appeal and to receive all refunds from such Tax
Appeal after the Closing Date, without any apportionment thereof; provided,
further, Seller agrees to indemnify and hold harmless Purchaser from and against
any liabilities, costs, penalties, assessments or charges incurred by or
asserted against, Purchaser in connection with or resulting from the Tax Appeal;

            (b) fuel oil in the tank at the Property, if any, (based upon
invoice cost, first in, first out), water and sewer service charges and charges
for gas, electricity, telephone and all other public utilities. If there are
meters measuring the consumption of water, gas or electric current, Seller, not
more than one day prior to the Apportionment Date, if possible, shall cause such
meters to be read, and shall pay all utility bills for which Seller is liable
upon receipt of statements therefor. Purchaser shall be responsible for causing
such utilities and services to be changed to its name and shall be liable for
and shall pay all utility bills for services rendered after the Apportionment
Date. All utility adjustments will be made by the parties outside of Closing;

            (c) amounts which have been paid or are payable under the Service
Contracts, Equipment Leases and Space Leases assigned to and assumed by
Purchaser at Closing; provided Seller shall not receive a credit for rents due
for the period prior to the Closing Date which are delinquent at the time of
Closing. Provided, further, if any tenant of the Property is obligated to pay
percentage rent based upon the calendar year or lease year or appropriate fiscal
quarter in which the date of Closing occurs (the "PERCENTAGE RENT PERIOD"),
Seller shall be entitled to a portion thereof determined by dividing (i) the
number of days which elapsed between the commencement date of the Percentage
Rent Period for each such tenant, and the Closing Date, by (ii) the total number
of days in such Percentage Rent Period. If Seller has received payments of
percentage rent based on any Percentage Rent Period in which the date of Closing
occurs, in excess of Seller's share as calculated as set forth above in this
subsection (a), it shall promptly pay such excess to Purchaser; and, if Seller
has received less, then Purchaser shall promptly pay the deficiency. Any amounts
due to Seller for percentage rent for the period prior to the Closing Date which
is not paid prior to the Closing Date, shall be paid to Seller upon receipt of
same by Purchaser following the Closing Date. Notwithstanding any other
provision hereof, the obligations of the parties under this subsection will
survive until the date that is three (3) months after the last date on which any
percentage rent was due and payable from any tenant of the Property with respect
to the Percentage Rent Period;

                                       27
<PAGE>

            (d) prepaid advertising expenses;

            (e) commissions of credit and referral organizations; and

            (f) all other charges and fees customarily prorated and adjusted in
similar transactions, including, without limitation, revenues and expenses
relating to spa or golf operations, conferences, receptions, meetings and other
functions occurring in any conference, banquet or meeting rooms in the Resort
(which shall specifically include, without limitation, all usage charges and
related taxes, food and beverage sales, valet parking charges, equipment rentals
and telecommunications charges, to the extent not already adjusted hereunder).

      13.2 DEPOSITS. All deposits (including any interest thereon due the party
making such deposit) from guests or others made as security or in connection
with future services to be rendered, including deposits made under the Space
Leases and Rooms Agreements, shall be credited to Purchaser at the Closing.
Purchaser shall assume responsibility for the amount so credited and shall hold
Seller harmless therefrom. Seller shall hold Purchaser harmless from any
liability for deposits not so credited.

      13.3 ROOM REVENUE. All revenues received or to be received from transient
guests on account of room rents for the period ending on the Apportionment Date
shall belong to Seller, and for the period beginning at 12:01 a.m. on the day
immediately following the Apportionment Date such revenues shall belong to
Purchaser; provided, however, that revenues received or "posted" in the normal
course after the time Seller normally closes its front desk activity for the
"night" audit for the Apportionment Date (the "FRONT DESK CLOSING HOUR") shall
belong to Purchaser. The accounts receivable of registered guests at the
Property who have not checked out and were occupying rooms as of 12:01 a.m. on
the Apportionment Date are collectively called the "CURRENT LEDGER", and
Purchaser shall pay over to Seller, as received by Purchaser, Seller's share of
the proceeds of the Current Ledger attributable to payments of each guest's
account for the period ending on the Apportionment Date, less applicable credit
card and travel agent commissions allocable to such share, which commissions
shall be paid by Purchaser out of such proceeds when and as collected. In the
event that an amount less than the total amount due from a guest is collected
and the guest continued in occupancy after the Apportionment Date, such amount
shall be applied first to any indebtedness owing by such person to Seller and
thereafter to such person's indebtedness to Purchaser.

      13.4 ACCOUNTS RECEIVABLE. (a) All accounts receivable (other than the
Current Ledger) originating prior to the Apportionment Date shall belong to
Seller. Seller shall have the right to receive, collect, discharge and
compromise all such

                                       28
<PAGE>

accounts receivable. A list of all such accounts receivable (other than the
Current Ledger) shall be presented to and be initialed by Purchaser and Seller
at Closing. Following Closing, Purchaser shall use good faith efforts toward the
collection of such accounts receivable, but Purchaser shall have no
responsibility or liability with regard to such accounts receivable nor be
expected to incur any cost with respect to such collections. With regard to any
collection made from any person or entity who is indebted to the Property both
with respect to accounts receivable accruing prior to the Apportionment Date and
to accounts receivable accruing subsequent to the Apportionment Date, if the
periods to which such payments relate are not specifically identified, such
collection shall be applied first to the payment in full of any amounts
currently due to Seller on accounts accruing prior to the Apportionment Date and
then to amounts due Purchaser on accounts accruing subsequent to the
Apportionment Date.

            (b) Any indebtedness, accounts payable, liabilities or obligations
of any kind or nature related to Seller or the Property for the periods prior to
and including the Apportionment Date shall be retained and paid by Seller, and
Purchaser shall not be or become liable therefor, except to the extent Purchaser
receives a credit therefor at Closing or otherwise assumes such liabilities
pursuant to this Agreement.

      13.5 FOOD AND BEVERAGE REVENUE; VENDING MACHINE REVENUE. All monies
received in connection with bar and restaurant services at the Property (other
than amounts due from any guest) during the Apportionment Date shall belong to
Purchaser. Vending machine proceeds shall be counted as close to the Front Desk
Closing Hour as is possible and the net amount thereof shall be credited to
Seller at Closing.

      13.6 GUESTS' PROPERTY. All baggage or other property of patrons of the
Property checked or left in care of Seller shall be listed in an inventory to be
prepared by Manager in duplicate and signed by Seller's and Purchaser's
representatives on the Closing Date. Purchaser shall be responsible from and
after the Closing Date and will indemnify and hold Seller harmless from and
against all claims for all baggage and property listed in such inventory. Seller
shall indemnify and hold harmless Purchaser from and against claims for damage
to or removal of any contents in baggage and property listed in such inventory
and for baggage and property not listed in such inventory, but shown to have
been left in custody at the Property prior to the Closing Date. All baggage or
other property of guests retained by Seller as security for unpaid accounts
receivable may be left on the Property without any responsibility or liability
therefor on the part of Purchaser, for a period not to exceed one (1) month from
Closing Date, within which time such baggage or other property shall be removed
or otherwise disposed of by Seller.

                                       29
<PAGE>

      13.7 ACCOUNTING. Except as otherwise expressly provided herein, all
apportionments and adjustments shall be made on an accrual basis in accordance
with generally accepted accounting principles. The computation of the
adjustments shall be jointly prepared by Seller and Purchaser or by Manager on
behalf of Seller and Purchaser, and, upon the request of either Purchaser or
Seller, shall be reviewed by PriceWaterhouseCoopers, or another similarly
reputable accounting firm (the "ACCOUNTANTS") and reviewed by representatives of
both Purchaser and Seller. To the extent the exact amount of any adjustment item
provided for in this Article XIII cannot be precisely determined on the Closing
Date, the Manager or Accountants shall estimate the amount thereof, for purposes
of computing the net amount due Seller or Purchaser pursuant to this Article
XIII and shall determine the exact amount thereof not later than ninety (90)
days after the Closing Date (the "ADJUSTMENT"). The determinations made by the
Accountants shall be binding on both Seller and Purchaser. The fees and expenses
of the Accountants shall be borne one-half each by Seller and Purchaser.

      13.8 EMPLOYEE COMPENSATION. Seller and the Manager shall be solely
responsible for any liability for payment of all employees' wages, accrued
vacation pay, sick leave, bonuses, pension benefits, including, without
limitation, any COBRA rights, and other benefits earned by and due to or accrued
to employees at the Property through 12:01 a.m. on the Closing Date, together
with F.I.C.A., unemployment and other taxes and benefits due from any employer
of such employees. Seller shall indemnify and hold Purchaser harmless from and
against any and all liability, loss, cost, damage or expense related to any of
the foregoing items. Such indemnity shall survive Closing.

      Notwithstanding the foregoing, Purchaser may elect, at its option, to
receive a credit against the Purchase Price for the amount of accrued vacation
pay and sick leave (the "PTO CREDIT") for employees who will be retained by
Manager. Purchaser shall indemnify and hold Seller harmless from and against any
and all liability, loss, cost, damage or expense for claims by such employees
for vacation pay and sick leave to the extent of the PTO Credit.

      13.9 DEVELOPMENT AGREEMENT. Purchaser shall receive a credit to the
Purchase Price at Closing equal to the excess of (a) the sum of (i) the
remaining amount required to be paid under the Development Agreement as of the
Closing Date, plus (ii) the estimated costs to complete, as supplied by Manager,
of the work remaining to be completed with respect to the other Capital
Projects, over (b) Ten Million Dollars ($10,000,000) (the "DEVELOPMENT AMOUNT").
To the extent that, after the Closing Date, Purchaser incurs aggregate costs
under the Development Agreement and in connection with completion of the Capital
Projects in excess of the Development Amount, Seller shall reimburse Purchaser
for such excess costs, provided that Seller shall have no liability whatsoever
for costs incurred in connection with any modifications after the Closing Date
of (x) the scope of work or

                                       30
<PAGE>

the specifications for the work described in the Development Agreement or on
EXHIBIT L attached hereto, or (y) in the case of the Development Agreement, any
increase in the Stipulated Sum (as defined in the Development Agreement). Any
such excess cost shall be determined in good faith by Seller and Purchaser (and
reimbursement made if necessary) prior to the end of the Survival Period.

      13.10 RESERVES, CASH AND GIFT CERTIFICATES. Seller shall receive a credit
at Closing for all (i) balances on deposit with banking institutions relating to
the Resort, including amounts held in "house banks" (collectively, the "CASH")
and (ii) all amounts held in the Reserves (to the extent that amounts held in
the Reserves by Lender or Manager are transferred to Purchaser; otherwise Seller
shall retain all such amounts). Purchaser shall receive a credit at Closing
equal to the dollar amount of the outstanding value of any gift certificates, to
the extent that such gift certificates are shown as liabilities on the
Property's operating statements as of the Closing Date. At Closing, Purchaser
agrees to replenish any Reserves for FF&E under the Management Agreements (the
"FF&E RESERVES") pursuant to the terms of that certain letter dated as of
December 2, 2005 from William F. Minnock to Seller and THI III GL Lessee, LLC
(the "DEVELOPMENT LETTER"); provided, however, in no event shall Purchaser be
required to reimburse any amounts in excess of the amounts required to be held
in the FF&E Reserves pursuant to the Management Agreements.

      13.11 ORIGINAL DEVELOPMENT AGREEMENT. Seller shall retain, and Purchaser
shall not assume, any rights, benefits, obligations, or liabilities under that
certain (i) Development Agreement dated as of April 19, 2001, as amended by the
First Amendment to Development Agreement dated as of December 27, 2002, by and
among Seller, Marriott Design and Manager (the "ORIGINAL DEVELOPMENT
AGREEMENT"), and (ii) Development Agreement (Grande Lakes Resort Exhibit Hall)
dated as of January 2004, by and among Marriott Design, Seller and Manager. The
Florida Department of Revenue is conducting a sales and use tax audit of all
construction projects performed by Marriott Design under the Original
Development Agreement for the period from May 1, 2001 through April 20, 2004
(the "Audit"). To the extent that Purchaser has access to all books and records
at the Property necessary for the Audit, Purchaser shall allow Seller to have
access to such books and records, and shall otherwise use commercially
reasonable efforts to cooperate with any requests by Seller regarding the Audit.
Seller shall retain all rights, benefits, obligations or liabilities in
connection with the Audit. Seller agrees to indemnify and hold harmless
Purchaser from and against any liabilities, costs, penalties, assessments, or
charges incurred by or asserted against Purchaser in connection with or
resulting from the Audit.

                                       31
<PAGE>

      13.12 MANAGEMENT

            (a) All income and expenses with respect to the Management
Agreements will be prorated as of the Apportionment Date (with income and
expenses for the Closing Date and thereafter to be allocated to Purchaser).
There shall be added to the amount due to Seller at Closing, on the Closing
Statement, the amount of any amounts paid by Seller under any Management
Agreements attributable to periods including and after the Apportionment Date,
and there shall be deducted from the amount due Seller at Closing, on the
Closing Statement, any such amounts paid to and collected by Seller under any
Management Agreements attributable to periods including and after the
Apportionment Date.

            (b) All management fees and other amounts payable or reimbursable
under the Management Agreements shall be prorated as of the Closing Date.
Notwithstanding the foregoing, if the amount of Incentive Management Fees (as
defined in the Management Agreements) which have been accrued for the period
prior to the Closing Date, exceeds the Incentive Management Fee shown on the
Annual Operating Statement (as defined in the Management Agreements) for fiscal
year 2006, Purchaser shall remit such excess to Seller within ten (10) days of
delivery of such Annual Operating Statements pursuant to the Management
Agreements. Purchaser's obligation under this Section 13.12(b) shall survive the
Closing Date.

      13.13 PURCHASER'S AUDIT. Purchaser may, at its sole cost and expense,
engage a third-party certified public accountant to perform audits of the books
and records of the Resort, including the historical financial statements of the
Resort, which audits shall include all disclosures required by generally
accepted accounting principles and the Securities and Exchange Commission
regulations, specifically in accordance with Section 3.05 of Regulation S-X and
all related rules and regulations thereof. Seller shall, and shall use
commercially reasonably efforts, at no cost to Seller, to cooperate in
connection with the performance of such audits and to the extent reasonably
available to Seller, shall provide all information with respect to the Resort
reasonably requested by such accountants, at no cost or expense to Seller. The
covenant of Seller set forth in this Section 13.13 regarding its cooperation, in
connection with the audit of the Resort books and records and providing
information reasonably requested shall survive Closing for a period of one (1)
year.

                                   ARTICLE XIV
                                  MISCELLANEOUS

      14.1 SURVIVAL. The representations, warranties, covenants and indemnities
contained in this Agreement shall be effective as of the Closing Date, and any
liability with respect to breach thereof shall survive the Closing for a period
of six

                                       32
<PAGE>

(6) months (the "SURVIVAL PERIOD"). Except as otherwise expressly provided
herein, all claims by either party hereto, whether for amounts due or otherwise,
under any provision of this Agreement, must be made in writing to the other
party no later than thirty (30) days from the expiration of the Survival Period.

      14.2 ASSIGNMENT. This Agreement may not be assigned by Purchaser without
the prior written consent of Seller, which Seller may grant or deny in its sole
and absolute discretion; provided, however that Purchaser shall be permitted to
assign this Agreement without the prior consent of Seller to any entity wholly
owned and controlled by Purchaser, provided notice thereof is given to Seller at
least five (5) business days prior to the Closing and such assignee assumes in
writing all of Purchaser's obligations hereunder. Notwithstanding the assumption
of this Agreement by such assignee, the Purchaser named herein shall remain
liable for all of the Purchaser's obligations hereunder and shall not be deemed
to be released as a result of such permitted assignment and assumption.

      14.3 CONSENTS. If, under this Agreement, the consent of a party is
required, the consent shall be in writing and shall be executed by a duly
authorized officer or agent.

      14.4 APPLICABLE LAW. This Agreement shall be governed by the laws of the
State of Florida, without resort to the choice of law rules thereof.

      14.5 HEADINGS; EXHIBITS. The headings of articles and sections of this
Agreement are inserted only for convenience; they are not to be construed as a
limitation of the scope of the particular provision to which they refer. All
exhibits attached or to be attached to this Agreement are incorporated herein by
this reference.

      14.6 NOTICES. Notices and other communications required by this Agreement
shall be in writing and delivered by hand against receipt or sent by recognized
overnight delivery service or by facsimile (with written confirmation of
receipt). All notices shall be addressed as follows:

            If to Purchaser:

            c/o CNL Hospitality Corp.
            CNL Center at City Commons
            450 South Orange Avenue
            Orlando, Florida 32801
            Attention: Chief General Counsel
            Fax: (407) 650-1085

                                       33
<PAGE>

            with a copy to:

            Lowndes, Drosdick, Doster, Kantor & Reed
            215 North Eola Drive
            Orlando, Florida  32801
            Attention:  Richard J. Fildes, Esq.
            Fax: (407) 843-4444

            If to Seller:

            THI III GL Investments L.L.C.
            c/o Thayer Lodging Group, Inc.
            410 Severn Avenue
            Suite 314
            Annapolis, Maryland 21403
            Attention:  David J. Weymer, Managing Director
            Fax: (410) 268-1582

            with a copy to:

            Hogan & Hartson L.L.P.
            555 13th Street, N.W.
            Washington, D.C.  20004
            Attention:  Carol Weld King, Esq.
            Fax: (202) 637-5910

or to such other address as may be designated by a proper notice. Notices shall
be deemed to be effective upon receipt (or refusal thereof).

      14.7 LIMITATION ON LIABILITY. Seller shall have no liability for the
breach of any representation, warranty, covenant, indemnity or other obligation
expressly stated to survive the Closing hereunder (collectively, "SELLER'S
POST-CLOSING OBLIGATIONS") unless and until the aggregate amount of Purchaser's
out-of-pocket damages and expenses directly resulting from such breaches exceeds
Five Hundred Thousand Dollars ($500,000.00) (the "THRESHOLD"). Furthermore,
Seller's aggregate liability under this Agreement for the breach of any and all
of Seller's Post-Closing Obligations (excluding fraud or intentional misconduct)
shall not exceed two and one-half percent (2.5%) of the Purchase Price (the
"POST-CLOSING LIABILITY CAP"), provided that Seller shall be responsible for its
share of any Adjustment, any breach of its representation contained in Section
14.14 and any obligation to pay taxes for the period prior to the Apportionment
Date which are not fully paid or prorated at Closing without regard to, or
application against, the Post-Closing Liability Cap. Furthermore, Seller shall
be responsible for any liability pursuant to Section 13.9 hereof without regard
to the Threshold, and without

                                       34
<PAGE>

regard to, or application against, the Post-Closing Liability Cap. At Closing,
Seller shall establish with the Escrow Agent a cash escrow in the amount of two
percent (2%) of the Purchase Price to secure the payment of Seller's
Post-Closing Obligations, if any, to be held in accordance with the form of
escrow instructions attached hereto as EXHIBIT EE.

      14.8 WAIVER. The failure of either party to insist on strict performance
of any of the provisions of this Agreement or to exercise any right granted to
it shall not be construed as a relinquishment or future waiver; rather, the
provision or right shall continue in full force. No waiver of any provision or
right shall be valid unless it is in writing and signed by the party giving it.

      14.9 PARTIAL INVALIDITY. If any part of this Agreement is declared invalid
by a court of competent jurisdiction, this Agreement shall be construed as if
such portion had never existed, unless this construction would operate as an
undue hardship on Seller or Purchaser or would constitute a substantial
deviation from the general intent of the parties as reflected in this Agreement.

      14.10 ENTIRE AGREEMENT. This Agreement, together with all Exhibits, the
other writings signed by the parties and incorporated by reference and together
with any instruments to be executed and delivered under this Agreement,
constitutes the entire agreement between the parties with respect to the
purchase and sale of the Property and supersedes all prior oral and written
understandings. Amendments to this Agreement shall not be effective unless in
writing and signed by the parties hereto.

      14.11 TIME IS OF THE ESSENCE. Time is of the essence with respect to
performance of all obligations under this Agreement.

      14.12 WAIVER OF JURY TRIAL. EXCEPT AS PROHIBITED BY LAW, NEITHER SELLER
NOR PURCHASER SHALL SEEK A JURY TRIAL ON ANY LAWSUIT, PROCEEDING OR COUNTERCLAIM
BASED UPON, OR ARISING OUT OF THIS AGREEMENT, OR THE RELATIONSHIP BETWEEN THE
PARTIES HERETO AS SELLER AND PURCHASER. IF THE SUBJECT MATTER OF ANY SUCH
LAWSUIT IS ONE IN WHICH THE WAIVER OF A JURY TRIAL IS PROHIBITED, NEITHER SELLER
NOR PURCHASER SHALL PRESENT AS A COUNTERCLAIM IN SUCH LAWSUIT ANY CLAIM NOT
ARISING OUT OF THIS AGREEMENT. FURTHERMORE, NEITHER SELLER NOR PURCHASER SHALL
SEEK TO CONSOLIDATE ANY SUCH ACTION IN WHICH A JURY TRIAL HAS BEEN WAIVED WITH
ANY SUCH ACTION IN WHICH A JURY TRIAL CANNOT BE WAIVED. THE PARTIES ACKNOWLEDGE
THAT THIS WAIVER IS A SIGNIFICANT CONSIDERATION TO EACH PARTY TO ENTER INTO THIS
AGREEMENT, AND BUT FOR EACH PARTY'S AGREEMENT TO THIS PROVISION, SUCH OTHER
PARTY WOULD NOT HAVE AGREED TO

                                       35
<PAGE>

THE TERMS AND CONDITIONS SET FORTH IN THIS AGREEMENT. THE PROVISIONS OF THIS
SECTION SHALL SURVIVE THE TERMINATION OF THIS AGREEMENT OR THE CLOSING (AS THE
CASE MAY BE).

      14.13 COUNTERPARTS. This Agreement may be executed in any number of
counterparts which, when taken together, shall constitute a single, binding
instrument.

      14.14 BROKERAGE. Purchaser and Seller represent to each other that no
broker or consultant acting on its behalf (other than Eastdil Realty Company,
L.L.C. (the "BROKER"), who shall be compensated by Seller pursuant to the terms
of a separate agreement) brought about this transaction. Each of the parties
hereto agrees to indemnify and hold the other harmless from claims made by any
broker, attorney or finder claiming through such party for a commission, fee or
compensation in connection with this Agreement or the sale of the Property
hereunder. The provisions of this Section 14.14 shall survive Closing.

      14.15 TIME FOR PERFORMANCE. If the date for the performance of any
obligation, or the giving of any notice, by Seller or Purchaser hereunder falls
upon a Saturday, Sunday or legal holiday recognized by the United States
government, then the time for such performance or notice shall be extended until
the next business day.

      14.16 CONFIDENTIALITY. Seller, Purchaser and their respective
representatives shall hold in strictest confidence all data and information
obtained with respect to the other party and its business, whether obtained
before or after the execution and delivery of this Agreement, and shall use
commercially reasonable efforts to not disclose the same to others; provided,
however, that it is understood and agreed that Seller and Purchaser may disclose
such data and information to the partners, members, investors, advisors,
employees, lenders, consultants, accountants and attorneys of Seller or
Purchaser, as applicable, provided that such persons agree to treat such data
and information confidentially; provided, however, Seller and Purchaser shall be
permitted to make such disclosures as may be required in order to comply with
all financial reporting, securities laws and other legal requirements applicable
to Seller or Purchaser. In the event this Agreement is terminated or Seller or
Purchaser fails to perform hereunder, Seller and Purchaser shall use
commercially reasonable efforts to promptly return to Seller or Purchaser, as
applicable, any statements, documents, schedules, exhibits or other written
information obtained from Seller or Purchaser in connection with this Agreement
or the transaction contemplated herein. Seller and Purchaser agree that none of
the written information obtained from the other party in connection with this
Agreement and the transactions contemplated herein will be used by Seller or
Purchaser, as applicable, for any purpose other than evaluating a possible
purchase of the Property or used in any way or manner

                                       36
<PAGE>

detrimental to the interests of Seller or Purchaser, as applicable. In the event
of a breach or threatened breach by Seller or Purchaser, as applicable, or its
agents or representatives of this Section 14.16, Seller or Purchaser, if
applicable, shall be entitled to an injunction restraining the other party, or
its respective agents or representatives from disclosing, in whole or in part,
such confidential information. The provisions of this Section 14.16 shall
survive Closing or any termination of this Agreement.

      14.17 RADON GAS NOTICE. Pursuant to Florida Statutes Section 404.056(8),
Seller hereby makes, and Purchaser hereby acknowledges, the following
notification:

      RADON GAS: Radon is a naturally occurring radioactive gas that, when it
      has accumulated in a building in sufficient quantities, may present health
      risks to persons who are exposed to it over time. Levels of radon that
      exceed federal and state guidelines have been found in buildings in
      Florida. Additional information regarding radon and radon testing may be
      obtained from your county public health unit.

      14.18 RECORDING. Neither this Agreement nor any memorandum thereof shall
be recorded in the Public Records of any county and any attempt to record this
Agreement or memorandum thereof shall render this Agreement unenforceable by the
recording party.

      14.19 LEGAL EXPENSES. In the event of litigation arising out of the terms
and conditions of this Agreement, the prevailing party in such litigation shall
have the right to recover from the non-prevailing party reasonable attorney's
fees and court costs incurred as a result of such litigation, including any
appeals or bankruptcy proceedings.

      14.20 DRAFTING. The preparation of this Agreement has been a joint effort
of the parties who have each had an opportunity to consult with an attorney.
This Agreement shall be construed without regard to any presumption or other
rule requiring construction against the party causing this Agreement to be
drafted. If any words or phrases in this Agreement shall have been stricken out
or otherwise added, this Agreement shall be construed as if the words or phrases
so stricken out are otherwise eliminated or never included in this Agreement. No
implication or reference shall be drawn from the fact that such words or phrases
were so stricken out or otherwise eliminated.

      14.21 BUSINESS DAY. The term "business day" as used herein shall mean any
day other than a Saturday, Sunday or other day on which commercial banks are
authorized or required to close under the laws of the State of Florida.

                                       37
<PAGE>

      14.22 WARN ACT OBLIGATIONS. The Seller and Purchaser agree to use
commercially reasonable efforts to comply and cause Manager to comply, with
their respective legal obligations, if any, under the Worker Adjustment and
Retraining Notification Act, 29 U.S.C., Section 2101, et seq. ("WARN"), and any
state equivalent to WARN. The Seller and Purchaser agree that Purchaser shall
have no obligations under WARN (or any state equivalent), for any events
triggering WARN that occur prior to the Closing Date and that the Seller shall
have no obligations under WARN (or any state equivalent), if any, for any event
triggering WARN that occur subsequent to the Closing Date. The Seller and
Purchaser further agree that this Section shall not be construed as an admission
or an acknowledgement by the Seller or Purchaser that either party is an
"employer" as such term is defined under WARN or any state equivalent. The
provision of this Section 14.22 shall survive Closing and delivery of the Deed.

                      [SIGNATURES APPEAR ON FOLLOWING PAGE]

                                       38
<PAGE>

      IN WITNESS WHEREOF, Seller and Purchaser have caused this Agreement to be
executed as of the date indicated below.

                                     SELLER

WITNESS:                             THI III GL INVESTMENTS L.L.C.

Marcel Verbaas                       By: /s/ David J. Weymer
--------------                           --------------------------
                                     Name: David J. Weymer
                                     Its:  President

                                     PURCHASER

WITNESS:                             CNL HOTELS & RESORTS, INC.

Eliza Bardin                         By: /s/ Marcel Verbaas
--------------                           --------------------------
                                     Name: Marcel Verbaas
                                     Its:  Chief Investment Officer
                                           and Senior Vice President

<PAGE>

                                    EXHIBITS

A   Legal Description of Land
B   List of Equipment Leases
C   List of Service Contracts
D   List of Space Leases
E   List of Rooms Agreements
F   Purchase Price Allocation
G   Management Agreements
H   Form of Escrow Instructions For Deposit
I   List of Environmental Documents
J   Exceptions
K   [Intentionally Deleted]
L   Capital Projects
M   Pending Contracts
N   Litigation
O   Form of Special Warranty Deed
P   Form of Bill of Sale
Q   Form of Assignment of Permits and Intangible Property
R   Form of Assignment and Assumption of Service Contracts,
    Rooms Agreements and Equipment Leases
S   Form of Assignment and Assumption of Development Agreement
T   Form of Owner's Affidavit
U   Form of FIRPTA Certificate
V   Form of Assignment and Assumption of Management Agreements
W   Form of Assignment and Assumption of Space Leases
X   Form of Tenant Notice
Y   Form of Seller's Closing Certificate
Z   Form of Purchaser Closing Certificate
AA  List of Scheduled Personalty
BB  List of Property Documents
CC  List of Operating Statements
DD  Form of Amendment to Declaration
EE  Form of Escrow Instructions for Post-Closing Obligations
FF  Form of Assignments of Declaration

<PAGE>

                                    EXHIBIT A

                            Legal Description of Land

Parcel 1, GRANDE LAKES RESORT, according to the Plat thereof as recorded in Plat
Book 58 at Pages 23 through 36, inclusive, of the Public Records of Orange
County, Florida, together with all easements appurtenant to said parcels
established by and pursuant to the terms of that certain Declaration of
Covenants, Conditions, Restrictions, Easements and Reservations for Grande Lakes
Resort, Orlando, Florida, made and executed by THI III GL Investments L.L.C.,
THI III GL Land Corporation and Grande Lakes Resort Property Owners Association,
Inc. dated as of April 1, 2004 and recorded on August 6, 2004 in Official
Records Book 7565 at Pages 1177 et seq. of the Public Records of Orange County,
Florida and that certain Declaration of Covenants, Conditions, Restrictions,
Easements and Reservations for Grande Lakes Master Stormwater Management System,
made and executed by THI III GL Investments L.L.C., THI III GL Land Corporation
and Grande Lakes Stormwater Management Association, Inc. recorded on August 7,
2003 in Official Records Book 7038 at Pages 2091 et seq. of the Public Records
of Orange County, Florida.

Parcel 4, GRANDE LAKES RESORT, according to the Plat thereof as recorded in Plat
Book 58 at Pages 23 through 36, inclusive, of the Public Records of Orange
County, Florida, together with all easements appurtenant to said parcels
established by and pursuant to the terms of that certain Declaration of
Covenants, Conditions, Restrictions, Easements and Reservations for Grande Lakes
Resort, Orlando, Florida, made and executed by THI III GL Investments L.L.C.,
THI III GL Land Corporation and Grande Lakes Resort Property Owners Association,
Inc. dated as of April 1, 2004 and recorded on August 6, 2004 in Official
Records Book 7565 at Pages 1177 et seq. of the Public Records of Orange County,
Florida and that certain Declaration of Covenants, Conditions, Restrictions,
Easements and Reservations for Grande Lakes Master Stormwater Management System,
made and executed by THI III GL Investments L.L.C., THI III GL Land Corporation
and Grande Lakes Stormwater Management Association, Inc. recorded on August 7,
2003 in Official Records Book 7038 at Pages 2091 et seq. of the Public Records
of Orange County, Florida.

Parcel 5, GRANDE LAKES RESORT, according to the Plat thereof as recorded in Plat
Book 58 at Pages 23 through 36, inclusive, of the Public Records of Orange
County, Florida, together with all easements appurtenant to said parcels
established by and pursuant to the terms of that certain Declaration of
Covenants, Conditions, Restrictions, Easements and Reservations for Grande Lakes
Resort, Orlando, Florida, made and executed by THI III GL Investments L.L.C.,
THI III GL Land Corporation and Grande Lakes Resort Property Owners Association,
Inc. dated as of April 1, 2004 and recorded on August 6, 2004 in Official
Records Book 7565

                                      A-2
<PAGE>

at Pages 1177 et seq. of the Public Records of Orange County, Florida and that
certain Declaration of Covenants, Conditions, Restrictions, Easements and
Reservations for Grande Lakes Master Stormwater Management System, made and
executed by THI III GL Investments L.L.C., THI III GL Land Corporation and
Grande Lakes Stormwater Management Association, Inc. recorded on August 7, 2003
in Official Records Book 7038 at Pages 2091 et seq. of the Public Records of
Orange County, Florida.

                                      A-3
<PAGE>

                                    EXHIBIT B

                                EQUIPMENT LEASES

<TABLE>
<CAPTION>
VENDOR NAME                                            TYPE               PROPERTY
-------------------------------------------           -----         --------------------
<S>                                                   <C>           <C>
Alamo Leasing (Silverado-Grounds)                     Lease         Grande Lakes Orlando
                                                                           ("GLO")

DCC Diebold Credit Corporation (1 machine)            Lease          Ritz-Carlton ("RC")

DCC Diebold Credit Corporation (2 machines)           Lease          JW Marriott ("JW")

Ford Credit (Navigator)                               Lease                  JW

GE Capital/Zeno (Copy machines)                       Lease                  RC

GE Capital/Zeno (Copy machines)                       Lease                  JW

GMAC (Escalade - FO)                                  Lease                  RC

GMAC (Escalade - FO)                                  Lease                  JW

Lease Corp of America (Radio's - Rooms)               Lease                  RC

Mercedes Benz (Front Office)                          Lease                  RC

PBCC (Mail Machine)                                   Lease                  RC

PBCC (Mail Machine)                                   Lease                  JW

PBCC (Shipping & Recvg)                               Lease                  RC

PBCC (Shipping & Recvg)                               Lease                  JW

PBCC (Shipping & Recvg)                               Lease                  GLO

PFG Leasing (n/k/a National City Golf)
(Grounds vehicles)                                    Lease                  GLO

STSN (a/k/a Ibahn General Holdings)                   Lease                 RC/JW

Sutton Leasing (Van-Blue)                             Lease                  RC

Sutton Leasing (F250 2wd XL-Engineering)              Lease                  GLO

Textron Financial (Golf carts)                        Lease               Golf/mix

Towne Park (Parking Equipment)                        Lease                 RC/JW
</TABLE>

                                      B-1
<PAGE>

                                    EXHIBIT C

                                SERVICE CONTRACTS

<TABLE>
<CAPTION>
VENDOR NAME                                            TYPE              PROPERTY
---------------------------------------------   -----------------  --------------------
<S>                                             <C>                <C>
Aboard Publishing                               Service Agreement           JW

Aqua Recycle                                    Service Agreement  Grande Lakes Orlando
                                                                          ("GLO")

Buff Masters (Hotel vehicle cleaning service)   Service Agreement           JW

CSI - Caddie Services, Inc.                     Service Agreement          Golf

The Carpet Cleaner                              Service Agreement         RC Spa

Certegy (check guarantee)                       Service Agreement           RC

Certegy (check guarantee)                       Service Agreement           JW

Cummins Southeastern Power, Inc.                   Maintenance              RC
                                                     Contract

Cummins Southeastern Power, Inc.                   Maintenance              JW
                                                     Contract

DMX Music, Inc.                                 Service Agreement           JW

EcoLab (Aqua Balance)                              Maintenance              RC
                                                     Contract

EcoLab (Aqua Balance)                              Maintenance              JW
                                                     Contract

Fitness Services of Florida, Inc.                  Maintenance              RC
                                                     Contract

Five Star Laundry                               Service Agreement          RC/JW

Food Team                                       Service Agreement           RC
</TABLE>

                                       C-2
<PAGE>

<TABLE>
<CAPTION>
VENDOR NAME                                            TYPE              PROPERTY
---------------------------------------------   -----------------  --------------------
<S>                                             <C>                <C>
GES Exposition Services, Inc.                   Service Agreement           RC

GES Exposition Services, Inc.                   Service Agreement           JW

GES Exposition Services, Inc. d/b/a Trade
Show Electrical                                 Service Agreement           RC

GES Exposition Services, Inc. d/b/a Trade       Service Agreement           JW
Show Electrical

Grunau                                          Service Agreement           RC

Grunau                                          Service Agreement           JW

Grunau                                          Service Agreement         RC Golf

Greenery Productions, Inc.                      Service Agreement          RC/JW

Haines City Fire Extinguisher Service, Inc         Maintenance              RC
                                                     Contract

Haines City Fire Extinguisher Service, Inc         Maintenance              JW
                                                     Contract

Hello Florida, Inc. (Theme events including
decor, tours and transportation)  Also called
"Destination Services"                          Service Agreement           RC

Hello Florida, Inc. (Theme events including
decor, tours and transportation)  Also called
"Destination Services"                          Service Agreement           JW

Infinite Energy                                 Service Agreement           GLO

Kid's Nite Out Recreation & Resort Management   Service Agreement          RC/JW

Mears (transportation services for guests)      Service Agreement           RC
</TABLE>

                                       C-2
<PAGE>

<TABLE>
<CAPTION>
VENDOR NAME                                            TYPE              PROPERTY
---------------------------------------------   -----------------  --------------------
<S>                                             <C>                <C>
Mears (transportation services for guests)      Service Agreement           JW

Micros                                             Maintenance              RC
                                                     Contract

Micros                                             Maintenance              JW
                                                     Contract

MidFlorida Armored & ATM, Inc.                  Service Agreement           JW

National Production Services Inc.               Service Agreement           RC

National Production Services Inc.               Service Agreement           JW

On Command Video                                Service Agreement          RC/JW

Otis Elevator Co.                                  Maintenance              RC
                                                     Contract

Otis Elevator Co.                                  Maintenance              JW
                                                     Contract

PADI (Prof.Assoc.of Diving Instructors)         Service Agreement           JW

PlayNetwork, Inc. (Starbucks)                   Service Agreement           JW

Rose Restoration                                Service Agreement           JW

Roto-Rooter                                        Maintenance              RC
                                                     Contract

Roto-Rooter                                        Maintenance              JW
                                                     Contract

Siemens                                            Maintenance             RC/JW
                                                     Contract

STSN                                               Maintenance             RC/JW
                                                    Agreement

Systems Design & Development, Inc. (Jazz           Maintenance             RC/JW
phone system)                                        Contract

Telemanager.net                                 Service Agreement          RC/JW

Terminix (Pest Elimination)                        Maintenance              RC
                                                     Contract

Terminix (Pest Elimination)                        Maintenance              JW
                                                     Contract

Thermal Tech, Inc.                                 Maintenance              GLO
                                                     Contract
</TABLE>

                                       C-3
<PAGE>

<TABLE>
<CAPTION>
VENDOR NAME                                            TYPE              PROPERTY
---------------------------------------------   -----------------  --------------------
<S>                                             <C>                <C>
Towne Park, Ltd                                 Service Agreement           RC

Towne Park, Ltd                                 Service Agreement           JW

Trane (Energy Mgmt)                                Maintenance             RC/JW
                                                     Contract

Triple B Cleaners                               Service Agreement           RC

Triple B Cleaners                               Service Agreement           JW

United Hospitality Resources, Inc.              Service Agreement           RC

United Service Companies                        Service Agreement           JW

United Temps                                    Service Agreement           RC

United Temps                                    Service Agreement           JW

Waste Mgmt Orlando                              Service Agreement           RC

Waste Mgmt Orlando                              Service Agreement           JW

EMC Venues                                      Service Agreement           GLO

TIG Global                                      Service Agreement           GLO

TECO Partners                                   Service Agreement           GLO
</TABLE>

                                       C-4
<PAGE>

                                    EXHIBIT D

                                  SPACE LEASES

<TABLE>
<CAPTION>
VENDOR NAME                                            TYPE               PROPERTY
--------------------------------------------        ----------      -------------------
<S>                                                 <C>             <C>
11th Hour Business Centers                          Concession      Ritz-Carlton ("RC")

11th Hour Business Centers                          Concession       JW Marriott ("JW")

Buena Vista Concessions, Inc. (Surrey
Bicycles)                                           Concession               RC

Buena Vista Concessions, Inc. (Surrey
Bicycles)                                           Concession               JW

Hertz                                               Concession               JW

JCORL Inc, dba John Craig                           Concession               JW

Lowe and Behold Event Accents, LLC (florist)        Concession             RC/JW

Mimi's Boutique Inc                                 Concession               JW

My Three Sons
(Game Room Concession)                              Concession               JW

My Three Sons
(employee snack, soda and food vending)             Concession               JW

My Three Sons
(guest laundry vending)                             Concession               JW

Nat Landau Hyman Jewels, Ltd.                       Concession               JW

Norman's
New World Orlando, LLC                                 Lease                 RC

Premier Getaways, Inc.                              Concession               JW

SeaWorld of Florida, Inc.                           Concession             RC/JW

Trade Winds (attendants for towel kiosk)            Concession               JW

Universal Money Centers, Inc. (ATMs)                Concession               RC
</TABLE>

                                      D-1
<PAGE>

<TABLE>
<CAPTION>
VENDOR NAME                                            TYPE               PROPERTY
--------------------------------------------        ----------      -------------------
<S>                                                 <C>             <C>
Universal Money Centers, Inc. (ATMs)                Concession               JW

American Express                                      License       Grande Lakes Orlando
                                                                          ("GLO")

InvoTech Systems, Inc. (Garment Inventory
Mgmt System)                                          License              RC/JW

Melissa Kelly/Primo                                   License                JW

NewMarket International, Inc. (Delphi MPE
Software)                                             License                RC

OpenTable, Inc. (restaurant reservation
network)                                              License                RC

OpenTable, Inc. (restaurant reservation
network)                                              License                JW

Peat's Operating Company, Inc.                        License                RC

Starbucks                                             License                JW
</TABLE>

                                      D-2
<PAGE>

                                   EXHIBIT E

                                ROOMS AGREEMENTS

<TABLE>
<CAPTION>
WHOLESALER NAME                           HOTEL CONTRACTED                CONTRACT DATES
-----------------------------             ------------------------        -----------------------------
<S>                                       <C>                             <C>
American Airlines Vacations               Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
Apple Vacations                           Ritz-Carlton/JW Marriott        Sept. 01, 2005- Dec. 31, 2006
Allied T. Pro                             Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
Airtours- TUI                             Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
American Tours International              Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
Bonotel                                   Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
British Airways                           Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
City Tours                                Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
Certified Vacations                       Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
CTN Tours                                 Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
Colletts Travel                           Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
Carrier                                   Ritz-Carlton                    Jan. 01-Dec. 31, 2006
Elegant Resorts                           Ritz-Carlton                    Jan. 01-Dec. 31, 2006
FTI North America                         Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
HotelBeds                                 Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
ITC Classics                              Ritz-Carlton                    Jan. 01-Dec. 31, 2006
JTB International                         Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
Kuoni Travel, LTD                         Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
MLT Vacations                             Ritz-Carlton                    Jan. 01-Dec. 31, 2006
National Leisure Group                    Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
New World Travel                          Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
North America Travel Service              JW Marriott                     Jan. 01-Dec. 31, 2006
Royal Caribbean Ltd                       Ritz-Carlton                    March 29-2005- Dec. 31, 2006
Seasons In Style                          Ritz-Carlton                    Jan. 01-Dec. 31, 2006
Tourco                                    Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
Thomas Cook Signature                     JW Marriott                     Jan. 01-Dec. 31, 2006
Travel Impressions                        Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
Travalco                                  Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
Virgin Holidays                           Ritz-Carlton/JW Marriott        Jan. 01-Dec. 31, 2006
Welcome USA                               Ritz-Carlton                    Jan. 01-Dec. 31, 2006
</TABLE>

                                      E-1
<PAGE>

                                    EXHIBIT F

                            PURCHASE PRICE ALLOCATION

<TABLE>
<S>                                        <C>
Land                                       $105,641,095

Building & Improvements                    $554,519,463

Furniture, Fixtures & Equipment            $104,839,442
                                           ------------
TOTAL                                      $755,000,000
</TABLE>

                                       F-1
<PAGE>

                                    EXHIBIT G

                              MANAGEMENT AGREEMENTS

                               GRANDE LAKES RESORT

1.    Management Agreement (JW Marriott Hotel), dated as of April 19, 2001, by
      and between Manager and Seller

      -     First Amendment to Management Agreement dated December 27, 2002, by
            and between Manager and THI III GL Lessee, L.L.C.

      -     Second Amendment to Management Agreement dated September 23, 2003,
            effective as of June 9, 2003, by and between Manager and THI III GL
            Lessee, L.L.C.

      -     Third Amendment to Management Agreement dated January 20, 2004, by
            and between Manager and THI III GL Lessee, L.L.C.

      -     Fourth Amendment to Management Agreement dated August 13, 2004, by
            and between Manager and THI III GL Lessee, L.L.C.

      -     Fifth Amendment to Management Agreement dated December 23, 2004, by
            and between Manager and THI III GL Lessee, L.L.C.

2.    Management Agreement (Ritz-Carlton Hotel), dated as of April 19, 2001, by
      and between Manager and Seller

      -     First Amendment to Management Agreement dated December 27, 2002, by
            and between Manager and THI III GL Lessee, L.L.C.

      -     Second Amendment to Management Agreement dated September 23, 2003,
            effective as of June 9, 2003, by and between Manager and THI III GL
            Lessee, L.L.C.

      -     Third Amendment to Management Agreement dated August 13, 2004, by
            and between Manager and THI III GL Lessee, L.L.C.

      -     Fourth Amendment to Management Agreement dated December 23, 2004, by
            and between Manager and THI III GL Lessee, L.L.C.

3.    Management Agreement (Golf Course), dated as of April 19, 2001, by and
      between Manager and Seller

      -     First Amendment to Management Agreement dated December 27, 2002, by
            and between Manager and THI III GL Lessee, L.L.C.

      -     Second Amendment to Management Agreement dated September 23, 2003,
            effective as of June 9, 2003, by and between Manager and THI III GL
            Lessee, L.L.C.

      -     Third Amendment to Management Agreement dated August 13, 2004, by
            and between Manager and THI III GL Lessee, L.L.C.

      -     Fourth Amendment to Management Agreement dated December 23, 2004, by
            and between Manager and THI III GL Lessee, L.L.C.

                                      G-1
<PAGE>

4.    Marketing Rights and Marketing Desk Agreement, dated as of July 31, 2003,
      by and between THI III GL Lessee L.L.C. and Marriott Ownership Resorts,
      Inc.

5.    First Amended and Restated Resort Integration Agreement, dated as of April
      1, 2004, by and among THI III GL Lessee, L.L.C., Manager and Seller

                                      G-2
<PAGE>

                                    EXHIBIT H

                     FORM OF ESCROW INSTRUCTIONS FOR DEPOSIT

                               December ___, 2005

The Talon Group
111 N. Orange Avenue
Suite 1285
Orlando, Florida  32801
Attention:  Michael J. Moore, Esq.

      Re:   Deposit under Purchase and Sale Agreement (the "Agreement") dated
            December ___, 2005, by and between THI III GL Investments L.L.C.
            ("Seller") and CNL Hotels & Resorts, Inc. ("Purchaser")

Gentlemen and Ladies:

      Purchaser and Seller have entered into the Agreement pursuant to which
Purchaser agrees to purchase the resort known as Grande Lakes Resort in Orlando,
Florida, all as more particularly set forth in the Agreement. In accordance with
the Agreement, Purchaser is delivering herewith cash in the amount of Fifteen
Million Dollars ($15,000,000) (which, along with any interest earned thereon, is
hereinafter referred to as the "Deposit"). You are to hold the Deposit in escrow
and deliver it to Seller or Purchaser in accordance with these instructions.

      If, prior to 5 p.m. Eastern time on December 30, 2005, you receive a
notice from Purchaser stating that it is terminating the Agreement, you shall
immediately return the Deposit to Purchaser. If after December 30, 2005, you
receive a written statement from Seller ("Seller's Notice") stating that (i)
Purchaser is in default under the Agreement, and (ii) a copy of Seller's Notice
has been delivered to Purchaser, you shall, on the third (3rd) business day
after receipt of Seller's Notice, deliver the Deposit (by delivering cash,
certified check or some other form of immediately available funds), to Seller,
at c/o Thayer Lodging Group, Inc, Inc., 410 Severn Avenue, Suite 314, Annapolis,
Maryland 21403, or such other address as Seller may request, except that if you
receive written notice from Purchaser or Purchaser's counsel within two (2)
business days after Purchaser's receipt of Seller's Notice that Purchaser
disputes Seller's right to receive the Deposit and directs you not to make the
foregoing delivery, you shall not deliver the Deposit to Seller but

                                      H-1
<PAGE>

shall instead retain the Deposit or, if appropriate, interplead the Deposit in a
court of competent jurisdiction.

      If closing occurs under the Agreement, you shall apply the Deposit in
accordance with instructions from Purchaser and Seller. If you receive a written
statement from Purchaser ("Purchaser's Notice") stating that (A) Purchaser is
excused from performing under the Agreement, and that a copy of Purchaser's
Notice has been delivered to Seller, or (B) Seller is in default under the
Agreement, and that a copy of Purchaser's Notice has been delivered to Seller,
you shall, on the third (3rd) business day after receipt of Purchaser's Notice,
deliver the Deposit to Purchaser at c/o CNL Hospitality Corp., CNL Center at
City Commons, 450 South Orange Avenue, Orlando, Florida 32801, except that if
you receive written notice from Seller or Seller's counsel within two (2)
business days after receipt of Purchaser's Notice that Seller disputes
Purchaser's right to receive the Deposit and directs you not to make the
foregoing delivery, you shall not deliver the Deposit to Purchaser but shall
instead retain it or, if appropriate, interplead the Deposit in a court of
competent jurisdiction.

      You are not to disclose to any person (other than the parties hereto,
their employees, agents or independent contractors) any information about the
Agreement or its existence or this letter of instructions (except if requested
by either party or as may be required by court in any litigation or by law).

      You are to maintain the Deposit in a federally-insured interest-bearing
account in a financial institution in the Orlando, Florida metropolitan area,
and all interest accruing thereon shall be paid to the party entitled to the
Deposit under the terms of the Agreement. However, we understand that you assume
no responsibility for, nor will we hold you liable for, any loss accruing due to
bank failure and/or takeover by a federal regulatory agency, or which arises
solely from the fact that the escrow amount exceeds One Hundred Thousand Dollars
($100,000) and that the excess amount is not insured by the Federal Deposit
Insurance Corporation. Nor shall you be required to institute legal proceedings
of any kind pursuant to these instructions, nor be required to defend any legal
proceedings which may be instituted against you with respect to the subject
matter of these instructions unless you are requested to do so by Purchaser or
Seller and arrangements reasonably satisfactory to you have been made to
indemnify you against the cost and expense of such defense by the party making
such request. If any dispute shall arise with respect to these instructions,
whether such dispute arises between the parties hereto or between the parties
hereto and other persons, you may interplead such Deposit. Escrow Agent shall be
responsible only for the performance of such duties as are strictly set forth
herein and in no event shall Escrow Agent be liable for any act or failure to
act under the provisions of this letter except where such action or inaction is
the result of Escrow Agent's willful misconduct or gross negligence.

                                      H-2
<PAGE>

      Seller and Purchaser each hereby agrees to indemnify you and hold you
harmless against any loss, liability or damage (including the cost of litigation
and reasonable counsel fees) incurred in connection with the performance of your
duties hereunder except as a result of your willful misconduct or gross
negligence.

      Please indicate your agreement to comply with the foregoing instructions
by executing at least two copies of this letter and returning one to Purchaser's
counsel and one to Seller's counsel.

                                 Very truly yours,

                                 SELLER

WITNESS/ATTEST:                  THI III GL INVESTMENTS L.L.C.

___________________              By:_______________________________
                                 Name:_____________________________
                                 Its:______________________________

                                 PURCHASER

WITNESS/ATTEST:                  CNL HOTELS & RESORTS, INC.

___________________              By:_______________________________
                                 Name:_____________________________
                                 Its:______________________________

ACKNOWLEDGED AND AGREED:

THE TALON GROUP

By:____________________________
Name:__________________________
Its:___________________________
Date:__________________________

                                      H-3
<PAGE>

                                    EXHIBIT I

                         LIST OF ENVIRONMENTAL DOCUMENTS

1.    Phase I Environmental Site Assessment of Ritz Carlton/JW Marriott Grande
      Lakes Orlando Resort dated February 8, 2005 (On Site Date of October 25
      and 26, 2004) prepared by EMG for Barclays Capital, along with Reliance
      Letter issued by EMG dated October 13, 2005 on behalf of Thayer Lodging
      Group.

2.    Phase I Environmental Site Assessment Update dated March 2001 prepared by
      Evans Environmental & Geosciences ("EE&G") for Manager (EE&G Project
      Number 04202000714), along with Reliance Letter issued by EE&G dated March
      28, 2001 on behalf of Seller.

3.    Phase I Environmental Site Assessment Update dated May 2000 prepared by
      EE&G for Triarc International of Orlando, Inc. (EE&G Project Number
      0302001941), along with Reliance Letter issued by EE&G dated March 28,
      2001 on behalf of Seller.

4.    Phase I Environmental Site Assessment dated October 1997 prepared by EE&G
      for Manager (EE&G Project Number 9810093), along with Reliance Letter
      issued by EE&G dated March 28, 2001 on behalf of Seller.

5.    Final Microbial Air Testing Report prepared by Gobbell Hays Partners,
      Inc., dated July 18, 2003.

6.    Moisture Content Data and other documentation relating to moisture
      abatement from Munters Moisture Control Services dated 2004 and 2005.

                                       I-1
<PAGE>

                                    EXHIBIT J

                                   EXCEPTIONS

1.    The provisions of all laws, ordinances and regulations affecting the
      Property, including, without limitation, zoning laws, ordinances and
      regulations.

2.    The occupancy rights of transient lodging guests.

3.    The Space Leases.

4.    The liens of any real estate or personal property taxes, assessments, and
      water or sewer charges, not yet due and payable (subject to apportionment
      as described herein).

5.    The state of facts disclosed in the ALTA/ACSM Land Title Survey prepared
      by Donald W. McIntosh Associates, Inc. dated March 21, 2005 (17 pages),
      and any other rights, interest or claims arising from and after March 21,
      2005 affecting the land which an updated survey would disclose and which
      are not shown by the public records.

6.    Rights of the State of Florida based on the doctrine of the state's
      sovereign ownership of lands lying below the ordinary high water line of
      any navigable waters. (Affects Parcel I)

7.    Rights of upper and lower owners in and to the use of the waters of
      Shingle Creek and to the continued uninterrupted flow thereof. (Affects
      Parcel 1)

8.    Notice of Restrictions on Real Estate executed by Florida Land Company,
      Jacksonville Gas Corporation, Florida Gas Utilities Company, Florida
      Natural Gas Company and Florida Gas Appliance Company, joined by R.Y.
      Patterson, Jr. and Lorraine Patterson, his wife, H.L. Wilhite and Bonnie
      Wilhite, his wife, and R.N. Dosh and Doris S. Dosh, his wife, as Owners,
      dated June 26, 1972 and recorded June 30, 1972 in Official Records Book
      2244, Page 736.

9.    Water Reuse Agreement between and executed by each of Orange County,
      Florida, and Orlando Resort A Associates Limited Partnership and Orlando
      Resort B Associates Limited Partnership, dated November 29, 1994, and
      recorded March 28, 1995 in Official Records Book 4871, Page 3401.

10.   Project ABC Transportation Impact and Developer's Agreement by and between
      Orange County, Florida and SC Orlando, L.L.C., a Delaware limited

                                       J-1
<PAGE>

      liability Company, recorded March 2, 2000 in Official Records Book 5952,
      Page 4835.

11.   Agreement Regarding Allocation of Development Rights and Entitlements and
      Restrictive Covenants recorded in Official Records Book 6310, Page 2194.

      Note: As amended by the First Amendment and Partial Release recorded
            October 24, 2002 in Official Records Book 6650 at Page 401.

      Note: As modified by the Assignment of Development Rights and Entitlements
            in favor of Grande Plaza, L.L.C., recorded August 7, 2003 in
            Official Records Book 7038 at Page 2289.

      Note: As modified by the Assignment of Development Rights and Entitlements
            in favor of Alta Grande, Ltd., recorded August 7, 2003 in Official
            Records Book 7038 at Page 2305.

      Note: As modified by the Assignment of Development Rights and Entitlements
            in favor of John Young and Central Florida Parkway, L.L.C., recorded
            August 7, 2003 in Official Records Book 7038 at Page 2321.

12.   Use Agreement recorded in Official Records Book 6977, Page 4478.

13.   Declaration of Covenants, Conditions, Restrictions, Easements and
      Reservations for Grande Lakes Master Stormwater Management System recorded
      in Official Records Book 7038, Page 2091.

14.   Deed of Conservation Easements recorded in Official Records Book 7131,
      Page 3594 (Affects Parcel 1).

15.   Non-Exclusive Drainage Easement and Joint Utilization Agreement recorded
      in Official Records Book 7280, Page 235 (Affects Parcel 1).

16.   Grant of Easements recorded in Official Records Book 7280, Page 262
      (Affects Parcel 1).

17.   Grant of Easement recorded in Official Records Book 7507, Page 2178
      (Affects Parcel 4).

18.   Grant of Easement recorded in Official Records Book 7507, Page 2194
      (Affects Parcels 1, 4, and 5).

19.   Grant of Non-Exclusive Drainage Easements, Joint Utilization Agreement and
      Bill of Sale recorded in Official Records Book 7507, Page 2216.

20.   Matters reflected upon the plat of Grande Lakes Resort recorded August 6,
      2004 in Plat Book 58, Pages 23 through 26, inclusive, Public Records of
      Orange County, Florida.

                                      J-2
<PAGE>

21.   Terms and conditions of the Declaration of Covenants, Conditions,
      Restrictions, Easements and Reservations recorded in Official Records Book
      7565, Page 1177.

22.   Memorandum of Marketing Rights and Marketing Desk Agreement recorded in
      Official Records Book 7587, Page 3834.

23.   Notice of Commencement filed November 7, 2005, recorded in Official
      Records Book 8291, Page 204, Public Records of Orange County, Florida.

                                      J-3
<PAGE>

                                    EXHIBIT K

                             [INTENTIONALLY DELETED]

                                       K-1
<PAGE>

                                    EXHIBIT L

                                CAPITAL PROJECTS
                                  GRANDE LAKES

1.    COQUINA GRAND HALL UPGRADE

      Upgrade the Coquina Grand Hall at the JW Marriott Hotel as follows:

      -     Add coral stone to door frames

      -     Install wainscot to all walls to 6 feet level

      -     Install styrofoam crown molding at 12 and 25 feet levels

      -     Hide or relocate pipes throughout the hall

      -     Paint walls from top of 12 foot crown molding to ceiling

      -     Add vinyl wallcovering between the wainscot and 12 foot crown
            molding

      -     Estimated cost: $600,000

2.    WIRELESS CONNECTIVITY

      Install a wireless antenna system in the hotels, spa and common areas
      throughout the Resort at an estimated cost of $2,090,517.02, as detailed
      in Schedule A attached hereto.

                                       L-1
<PAGE>

                                   SCHEDULE A

                  GRANDE LAKES DAS INSTALLATION COST BREAKDOWN
                                   10/26/2005

<TABLE>
<CAPTION>
                                   JWCC V&DW/S   JWHT V&DW/S   JWBR V&DW/S   JWPOOL V&DW/S   RZCC V&DW/S   RZH V&DW/S
WITH SPECTRALINK INFRASTRUCTURE    CONF.CTR.    HOTEL TOWER   BALL ROOMS        POOLS        CONF.CTR.    HOTEL TOWER
--------------------------------   -----------   -----------   -----------   -------------   -----------   -----------
<S>                                <C>           <C>           <C>           <C>             <C>           <C>
DAS Voice Equipment                $231,772.50   $206,010.00   $11,445.00     $22,890.00     $ 68,670.00   $171,675.00
DAS Data Equipment                 $ 42,405.00   $ 88,665.00   $ 5,782.50     $ 3,855.00     $ 25,057.50   $ 59,752.50
Antennas                           $  5,460.00   $  9,230.00   $   520.00     $   330.00     $  3,315.00   $  7,735.00
Cabling Voice                      $ 67,512.79   $105,753.94   $ 4,943.75     $ 3,605.50     $ 48,804.71   $124,996.08
Cabling Data                       $  5,008.00   $  4,078.00   $   647.00     $   358.00     $  3,144.00   $  3,315.00
Power Equipment                    $ 10,000.00   $         -   $        -     $        -     $         -   $         -
Cabling Services Voice             $ 57,199.41   $ 90,739.06   $ 4,816.50     $ 4,945.25     $ 41,253.94   $150,754.65
Cabling Services Data              $  3,010.50   $  4,775.74   $   253.50     $   260.75     $  2,171.26   $  7,934.46
Equipment Installation Services
  Voice                            $ 47,055.80   $ 38,149.80   $ 6,329.10     $ 2,905.45     $ 28,097.70   $ 31,149.10
Equipment Installation Services
  Data                             $ 17,404.20   $ 14,110.20   $ 2,340.90     $ 1,074.60     $ 10,392.30   $ 11,520.90
Taxes and Shipping                 $         -   $         -   $        -     $        -     $         -   $         -

Total Cost Voice                   $403,540.50   $440,652.80   $27,534.35     $34,355.15     $186,826.35   $478,574.83
Total Cost Data                    $ 67,827.70   $111,628.94   $ 9,023.90     $ 5,548.35     $ 40,765.06   $ 82,522.86
Total Other Cost                   $ 15,460.00   $  9,230.00   $   520.00     $   330.00     $  3,315.00   $  7,735.00
Total Cost                         $486,828.19   $561,551.74   $37,078.25     $40,233.50     $230,906.41   $568,832.68

<CAPTION>
                                   RZPOOL V&DW/S   RZSPA V&DW/S   RZGOLF V&DW/S     RZNBR V&D
WITH SPECTRALINK  INFRASTRUCTURE     POOLS             SPA          GOLF CLUB     NEW BALLROOM     GRAND TOTAL
--------------------------------   -------------   ------------   -------------   -------------   -------------
<S>                                <C>             <C>            <C>             <C>             <C>
DAS Voice Equipment                 $11,445.00      $11,445.00      $22,890.00      $11,445.00    $  769,687.50
DAS Data Equipment                  $ 1,927.50      $ 5,782.50      $ 3,855.00      $ 7,710.00    $  244,792.50
Antennas                            $   165.00      $   780.00      $   325.00      $ 1,040.00    $   28,900.00
Cabling Voice                       $ 2,297.75      $ 8,630.75      $ 6,135.75      $ 7,694.00    $  380,375.02
Cabling Data                        $   398.00      $   412.00      $   358.00      $        -    $   17,718.00
Power Equipment                     $        -      $        -      $        -      $        -    $   10,000.00
Cabling Services Voice              $ 4,063.63      $ 8,345.75      $ 8,918.13      $ 3,952.00    $  374,997.30
Cabling Services Data               $   213.88      $   439.25      $   469.38      $   208.00    $   19,736.70
Equipment Installation Services
  Voice                             $ 3,949.30      $ 6,197.70      $ 4,438.40      $10,074.00    $  178,346.30
Equipment Installation Services
  Data                              $ 1,460.70      $ 2,292.30      $ 1,641.60      $ 3,726.00    $   65,963.70
Taxes and Shipping                  $        -      $        -      $        -      $        -    $           -

Total Cost Voice                    $21,755.68      $34,619.20      $42,382.28      $33,165.00    $1,703,406.12
Total Cost Data                     $ 4,000.08      $ 8,926.05      $ 6,323.98      $11,644.00    $  348,210.90
Total Other Cost                    $   165.00      $   780.00      $   325.00      $ 1,040.00    $   38,900.00
Total Cost                          $25,920.75      $45,325.25      $49,031.25      $45,849.00    $2,090,517.02
</TABLE>

                                                                          Page 9

                                      L-2
<PAGE>

                                    EXHIBIT M

                                PENDING CONTRACTS

<TABLE>
<CAPTION>
WHOLESALER NAME           HOTEL CONTRACTED                CONTRACT DATES
<S>                       <C>                             <C>
AnaHallo Tours            Ritz-Carlton/ JW Marriott       Jan. 01- Dec. 31, 2006
Emirates                  Ritz-Carlton/ JW Marriott       Jan. 01- Dec. 31, 2006
First Choice/Sovereign    Ritz-Carlton/ JW Marriott       Jan. 01- Dec. 31, 2006
GOGO- Liberty Travel      Ritz-Carlton/ JW Marriott       Jan. 01- Dec. 31, 2006
Holiday Network           Ritz-Carlton/ JW Marriott       Jan. 01- Dec. 31, 2006
Kintetsu                  Ritz-Carlton/ JW Marriott       Jan. 01- Dec. 31, 2006
Mark Travel               Ritz-Carlton/ JW Marriott       Jan. 01- Dec. 31, 2006
Premier Travel            Ritz-Carlton/ JW Marriott       Jan. 01- Dec. 31, 2006
Privilege Tourism         Ritz-Carlton/ JW Marriott       Jan. 01- Dec. 31, 2006
Tourico Holidays          Ritz-Carlton/ JW Marriott       Jan. 01- Dec. 31, 2006
World of Travel           Ritz-Carlton/ JW Marriott       Jan. 01- Dec. 31, 2006
</TABLE>

                                      M-1
<PAGE>

                                    EXHIBIT N

                                   LITIGATION

Litigation:

Gene Versage v. Marriott International, Inc. - Case #6-05-CV-974-ORL-19JGG
(employment discrimination case)

Claims:

<TABLE>
<CAPTION>
                                                           CLAIMANT   TOTAL      TOTAL
CLAIM #     DOI        UNIT NAME     CLAIMANT TYPE         STATUS     PAIDS      INCURS
-------   --------    -----------   ------------------     --------   --------   ---------
<S>       <C>         <C>           <C>                    <C>        <C>        <C>
104820    07/29/05    JW Marriott   EPLI                   Open           0.00   12,500.00
105885    10/15/05    JW Marriott   EPLI                   Open         950.00    8,500.00
097286    08/28/05    JW Marriott   GL - Alleged Theft     Open           0.00      100.00
102756    10/29/05    JW Marriott   GL - Alleged Theft     Open           0.00      100.00
103118    11/02/05    JW Marriott   GL - Alleged Theft     Open           0.00      100.00
103151    11/02/05    JW Marriott   GL - Alleged Theft     Open           0.00       25.00
103437    11/06/05    JW Marriott   GL - Alleged Theft     Open           0.00      100.00
103551    11/03/05    JW Marriott   GL - Alleged Theft     Open           0.00       50.00
103917    11/11/05    JW Marriott   GL - Alleged Theft     Open           0.00        0.00
104360    11/03/05    JW Marriott   GL - Alleged Theft     Open           0.00       50.00
105905    12/05/05    JW Marriott   GL - Alleged Theft     Open           0.00       50.00
106643    12/12/05    JW Marriott   GL - Alleged Theft     Open           0.00      100.00
                                    GL - General
043098    07/29/03    JW Marriott   Liability              Open           0.00   10,000.00
                                    GL - General
048324    10/11/03    JW Marriott   Liability              Open       3,997.28   54,000.00
                                    GL - General
048365    10/11/03    JW Marriott   Liability              Open       1,941.75   13,500.00
                                    GL - General
053913    01/10/04    JW Marriott   Liability              Re-Open        0.00    1,500.00
                                    GL - General
062507    05/14/04    JW Marriott   Liability              Open           0.00      500.00
                                    GL - General
067166    07/21/04    JW Marriott   Liability              Open           0.00    1,500.00
                                    GL - General
068737    08/10/04    JW Marriott   Liability              Open           0.00   10,000.00
                                    GL - General
069231    08/16/04    JW Marriott   Liability              Open           0.00   15,000.00
                                    GL - General
070941    09/11/04    JW Marriott   Liability              Open           0.00      100.00
                                    GL - General
081298    11/30/04    JW Marriott   Liability              Open           0.00       50.00
                                    GL - General
081846    02/24/05    JW Marriott   Liability              Open           0.00    1,000.00
                                    GL - General
081853    12/19/04    JW Marriott   Liability              Open           0.00   20,000.00
                                    GL - General
085866    04/21/05    JW Marriott   Liability              Open         128.68      500.00
                                    GL - General
088116    05/20/05    JW Marriott   Liability              Open           0.00      750.00
                                    GL - General
091702    07/01/05    JW Marriott   Liability              Open           0.00    1,000.00
                                    GL - General
</TABLE>

                                       N-1
<PAGE>

<TABLE>
<CAPTION>
                                                           CLAIMANT   TOTAL      TOTAL
CLAIM #     DOI        UNIT NAME     CLAIMANT TYPE         STATUS     PAIDS      INCURS
-------   --------    -----------   ------------------     --------   --------   ---------
<S>       <C>         <C>           <C>                    <C>        <C>        <C>
096640    08/22/05    JW Marriott   Liability              Open           0.00      750.00
                                    GL - General
099403    09/23/05    JW Marriott   Liability              Open           0.00      100.00
                                    GL - General
099884    09/29/05    JW Marriott   Liability              Open           0.00      100.00
                                    GL - General
100048    10/01/05    JW Marriott   Liability              Open           0.00      100.00
                                    GL - General
100455    10/03/05    JW Marriott   Liability              Open           0.00       50.00
                                    GL - General
100722    10/07/05    JW Marriott   Liability              Open           0.00      100.00
                                    GL - General
100771    10/08/05    JW Marriott   Liability              Open           0.00      100.00
                                    GL - General
101492    10/13/05    JW Marriott   Liability              Open           0.00      400.00
                                    GL - General
103538    11/07/05    JW Marriott   Liability              Open         428.00      450.00
                                    GL - General
103942    11/12/05    JW Marriott   Liability              Open           0.00      500.00
                                    GL - General
104028    11/10/05    JW Marriott   Liability              Open           0.00      250.00
                                    GL - General
104036    11/13/05    JW Marriott   Liability              Open           0.00    2,000.00
                                    GL - General
104392    11/16/05    JW Marriott   Liability              Open           0.00      100.00
                                    GL - General
104421    11/16/05    JW Marriott   Liability              Open           0.00      100.00
                                    GL - General
105210    11/28/05    JW Marriott   Liability              Open           0.00      100.00
                                    GL - General
105264    11/28/05    JW Marriott   Liability              Open           0.00      100.00
                                    GL - General
105424    12/01/05    JW Marriott   Liability              Open           0.00      100.00
                                    GL - General
105740    12/04/05    JW Marriott   Liability              Open           0.00      100.00
                                    GL - General
106276    12/10/05    JW Marriott   Liability              Open           0.00      100.00
101874    10/12/05    JW Marriott   WC - Medical           Open         106.39      106.39
103010    11/01/05    JW Marriott   WC - Medical           Open       1,056.99    1,056.99
103169    11/03/05    JW Marriott   WC - Medical           Open         746.09      746.09
105122    11/26/05    JW Marriott   WC - Medical           Open           0.00        0.00

097112    08/08/05    Ritz-Carlton  EPLI                   Open          50.00   10,000.00
103417    11/04/05    Ritz-Carlton  GL - Alleged Theft     Open           0.00      100.00
104071    11/11/05    Ritz-Carlton  GL - Alleged Theft     Open           0.00       10.00
105067    10/28/05    Ritz-Carlton  GL - Alleged Theft     Open       2,736.00    2,750.00
105915    12/06/05    Ritz-Carlton  GL - Alleged Theft     Open           0.00       50.00
                                    GL - General
042909    07/28/03    Ritz-Carlton  Liability              Re-Open       81.60      100.00
                                    GL - General
054449    01/19/04    Ritz-Carlton  Liability              Open           0.00    3,000.00
                                    GL - General
057368    12/06/03    Ritz-Carlton  Liability              Open           0.00    5,000.00
                                    GL - General
066321    07/10/04    Ritz-Carlton  Liability              Open           0.00   10,000.00
                                    GL - General
089690    03/18/05    Ritz-Carlton  Liability              Open           0.00    3,000.00
                                    GL - General
090877    06/24/05    Ritz-Carlton  Liability              Open           0.00      500.00
                                    GL - General
</TABLE>

                                       N-2
<PAGE>

<TABLE>
<CAPTION>
                                                           CLAIMANT   TOTAL      TOTAL
CLAIM #     DOI        UNIT NAME     CLAIMANT TYPE         STATUS     PAIDS      INCURS
-------   --------    -----------   ------------------     --------   --------   ---------
<S>       <C>         <C>           <C>                    <C>        <C>        <C>
096284    08/19/05    Ritz-Carlton  Liability              Open           0.00    1,000.00
                                    GL - General
097774    09/05/05    Ritz-Carlton  Liability              Open           0.00      100.00
                                    GL - General
102221    10/23/05    Ritz-Carlton  Liability              Open           0.00      100.00
                                    GL - General
102334    10/24/05    Ritz-Carlton  Liability              Open           0.00       50.00
                                    GL - General
103019    11/01/05    Ritz-Carlton  Liability              Open         726.73      750.00
                                    GL - General
105152    11/26/05    Ritz-Carlton  Liability              Open           0.00      100.00
060721    04/20/04    Ritz-Carlton  WC - Indemnity         Re-Open      349.80    1,500.00
101460    10/15/05    Ritz-Carlton  WC - Medical           Open         397.90      397.90
102570    10/15/05    Ritz-Carlton  WC - Medical           Open         283.66      283.66
105585    12/02/05    Ritz-Carlton  WC - Medical           Open           0.00        0.00
</TABLE>

                                       N-3
<PAGE>

                                    EXHIBIT O

                          FORM OF SPECIAL WARRANTY DEED

This instrument was prepared
by and should be returned to:

Richard J. Fildes, Esquire
Lowndes, Drosdick, Doster, Kantor
  & Reed, P.A.
Post Office Box 2809
Orlando, Florida  32802-2809
Tax Folio #________________

                              SPECIAL WARRANTY DEED

            THIS SPECIAL WARRANTY DEED, made and executed as of the _____ day of
_____________, 200__, by _____________________________, a ___________________,
whose address is _____________________________________________ (hereinafter
referred to as the "Grantor") to _______________________, a
_____________________, whose address is
____________________________________________ (hereinafter referred to as the
"Grantee");

                              W I T N E S S E T H:

            That the Grantor, for and in consideration of the sum of TEN DOLLARS
($10.00) and other valuable considerations, the receipt and sufficiency of which
are hereby acknowledged by these presents does grant, bargain, sell, alien,
remise, release, convey, and confirm unto the Grantee that certain piece, parcel
or tract of land situated in Orange County, Florida more particularly described
as follows, to wit:

                         SEE EXHIBIT "A" ATTACHED HERETO
                    AND BY THIS REFERENCE MADE A PART HEREOF

(hereinafter referred to as the "Subject Property");

                                      O-1
<PAGE>

            TOGETHER WITH all the tenements, hereditaments, easements and
appurtenances, including riparian rights, if any, thereto belonging or in
anywise appertaining;

            TO HAVE AND TO HOLD the Subject Property in fee simple forever.

            AND the Grantor does hereby covenant with and warrant to the Grantee
that the Grantor is lawfully seized of the Subject Property in fee simple; that
the Grantor has good right and lawful authority to sell and convey the Subject
Property; and that the Grantor fully warrants the title to the Subject Property
and will defend the same against the lawful claims of all persons claiming by,
through or under the Grantor, but against none other.

            THE conveyance made herein, however, is expressly made SUBJECT TO ad
valorem real property taxes and assessments for the year 200__ and thereafter,
and those matters listed on EXHIBIT "B" attached hereto and incorporated herein
by this reference, provided that this reference shall not operate to reimpose
the same.

            IN WITNESS WHEREOF, the Grantor has caused these presents to be
executed in manner and form sufficient to bind it as of the day and year first
above written.

Signed, sealed and delivered
in the presence of:
                         _____________________________,
                                                       a
__________________________________________

____________________________________        By: ______________________________
Name: ______________________________            Name: ________________________
_______________________
                                                Title: _______________________
_______________________

____________________________________        Address:
Name: ______________________________
        ________________________

        ________________________

                                      O-2
<PAGE>

STATE OF _______________
COUNTY OF ______________

            The foregoing instrument was acknowledged before me this ___ day of
________________, 200__ by ___________________, as ________________ of
__________________________, a ____________________, on behalf of the
_____________. He (She) is personally known to me or has produced
_______________________ as identification.

                                        _______________________________
(NOTARY SEAL)                             Notary Public Signature

                                        _______________________________
                                        Typed or Printed Notary Name _________
                                        Notary Public-State of ____________
                                        Commission No.: ___________
                                        My Commission Expires: __________

                                      O-3
<PAGE>

                                   EXHIBIT "A"

                                      O-4
<PAGE>

                                   EXHIBIT "B"

                                      O-5
<PAGE>

                                    EXHIBIT P

                              FORM OF BILL OF SALE

                                  BILL OF SALE

            THIS BILL OF SALE (the "Bill of Sale") is made and entered into as
of the __day of ____________, 200__, by and between ___________________________,
a __________________ ("Seller") and ______________________________,
a___________________ ("Buyer");

                              W I T N E S S E T H:

            WHEREAS, Seller and Buyer are parties to that certain Purchase and
Sale Agreement dated _________ __, 200__ (the "Agreement"), pursuant to which
Seller has agreed, among other things, to sell, assign, transfer and convey to
Buyer the Property (as defined in the Agreement); and

            WHEREAS, in connection with the sale and purchase of the Property,
Seller has agreed to sell, transfer and convey to Buyer all of Seller's right,
title and interest in and to the FF&E, the Fixed Asset Supplies, and the
Inventories. Unless otherwise defined herein, all capitalized terms used in this
Bill of Sale shall have the meaning given to such term in the Agreement, and
this Bill of Sale shall be subject to and qualified by the terms of the
Agreement.

            NOW, THEREFORE, in consideration of the foregoing and Ten Dollars
($10.00) and other good and valuable consideration in hand paid by Buyer to
Seller, the receipt and sufficiency of which are hereby acknowledged, Seller and
Buyer do hereby agree as follows:

            1. Seller does hereby sell, transfer and convey to Buyer all of
Seller's rights title and interest in and to the FF&E, the Fixed Asset Supplies,
and the Inventories and Buyer hereby purchases and accepts all of said right,
title and interest in and to the FF&E, the Fixed Asset Supplies, and the
Inventories.

            2. EXCEPT AS OTHERWISE PROVIDED IN THIS PARAGRAPH 2 BELOW OR IN THE
AGREEMENT, ALL OF THE FF&E, THE FIXED ASSET SUPPLIES AND THE INVENTORIES ARE
HEREBY SOLD, TRANSFERRED AND CONVEYED TO BUYER ON AN "AS IS", "WHERE IS", "WITH
ALL FAULTS" BASIS, WITHOUT RECOURSE, REPRESENTATION, IMPLIED OR EXPRESS
WARRANTY, GUARANTY, PROMISE, PROJECTION OR PREDICTION WHATSOEVER WITH RESPECT TO
THE PERSONAL

                                      P-1
<PAGE>

PROPERTY, WHETHER WRITTEN OR ORAL, EXPRESS OR IMPLIED, OR ARISING BY OPERATION
OF LAW, INCLUDING WITHOUT LIMITATION ANY WARRANTY OR MERCHANTABILITY OR FITNESS
FOR A PARTICULAR PURPOSE. Notwithstanding the foregoing to the contrary, Seller
does hereby warrant to Buyer that the FF&E, the Fixed Asset Supplies and the
Inventories are all free and clear of any and all claims , liens or encumbrances
of whatsoever nature; EXCEPTING ONLY the Permitted Exceptions.

            3. This Bill of Sale may be executed in any number of counterparts,
all of which taken together shall constitute one and the same instruments and
any of the parties hereto may execute this Bill of Sale by signing any such
counterpart.

            IN WITNESS WHEREOF, the undersigned has executed this Bill of Sale
as of the date first above written.

Signed, sealed and delivered
In the presence of:                      "SELLER":
                                         ______________________________________
                                         a ____________________________________

__________________________________       By: __________________________________
Printed Name: ____________________       Name: ________________________________
                                         Title: _______________________________

Printed Name: ____________________

                                        "BUYER":

                                         ______________________________________
                                         a ____________________________________

__________________________________       By:__________________________________
Printed Name: ____________________       Name: _______________________________
                                         Title: ______________________________

__________________________________
Printed Name: ____________________

                                      P-2
<PAGE>

                                    EXHIBIT Q

              FORM OF ASSIGNMENT OF PERMITS AND INTANGIBLE PROPERTY

                  ASSIGNMENT OF PERMITS AND INTANGIBLE PROPERTY

            THIS ASSIGNMENT OF PERMITS AND INTANGIBLE PROPERTY (this
"Assignment") is made and entered into as of the ___day of ________, 200__, by
_____________________________, a ____________________having a mailing address at
_____________________________________("Assignor") to and in favor of ___
_________________, a ____________, having a mailing address at
___________("Assignee");

                              W I T N E S S E T H:

            WHEREAS, Assignor and Assignee are parties to that certain Purchase
and Sale Agreement dated _________ __, 200__ (the "Agreement"), pursuant to
which Assignor has agreed, among other things, to sell, assign, transfer and
convey to Assignee the Property (as defined in the Agreement); and

            WHEREAS, in connection with the sale and purchase of the Property,
Assignor has agreed to assign to Assignee all of Assignor's right, title and
interest in and to the Permits and the Intangible Property, to the extent that
such right, title and interest is assignable by Assignor. Unless otherwise
defined herein, all capitalized terms used in this Assignment shall have the
meaning given to such term in the Agreement, and this Assignment shall be
subject to and qualified by the terms of the Agreement.

            NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound,
Assignor hereby assigns, transfers, and conveys to Assignee all of Assignor's
right, title and interest in and to the Permits and the Intangible Property, to
the extent that such right, title and interest is assignable by Assignor.
Assignor covenants with Assignee that Assignor will execute or procure any
additional documents necessary to establish the rights of the Assignee
hereunder. This Assignment shall be binding upon and inure to the benefit of
Assignor, Assignee and their respective successors and assigns.

                                      Q-1
<PAGE>

            IN WITNESS WHEREOF, the parties have executed this Assignment as of
the date set forth above.

Signed, sealed and delivered
In the presence of:
                                         ______________________________________
                                         a ____________________________________

                                         By: __________________________________
___________________________________      Name: ________________________________
Witness Name: _____________________      Title: _______________________________

                                         (CORPORATE SEAL)
___________________________________
Witness Name: _____________________

                                      Q-2
<PAGE>

                                    EXHIBIT R

          FORM OF ASSIGNMENT AND ASSUMPTION OF SERVICE CONTRACTS, ROOMS
                        AGREEMENTS AND EQUIPMENT LEASES

                 ASSIGNMENT AND ASSUMPTION OF SERVICE CONTRACTS,
                      ROOMS AGREEMENTS AND EQUIPMENT LEASES

            THIS ASSIGNMENT AND ASSUMPTION OF SERVICE CONTRACTS, ROOMS
AGREEMENTS AND EQUIPMENT LEASES (this "Assignment") is made and entered into as
of the ___day of ______________, 200__, by and between
_____________________________, a ____________________having a mailing address at
_____________________________________("Assignor"), and _________________, a
____________, having a mailing address at ___________("Assignee");

                              W I T N E S S E T H:

            WHEREAS, Assignor and Assignee are parties to that certain Purchase
and Sale Agreement dated _____________ __, 200__ (the "Agreement"), pursuant to
which Assignor has agreed, among other things, to sell, assign, transfer and
convey to Assignee the Property (as defined in the Agreement); and

            WHEREAS, in connection with the sale and purchase of the Property,
Assignor has agreed to assign to Assignee all of Assignor's right, title and
interest in and to the Service Contracts, Rooms Agreements and Equipment Leases,
and Assignee has agreed to assume from Assignor all of Assignor's obligations
and liabilities arising from and after the Apportionment Date with respect to
the Service Contracts, Rooms Agreements and Equipment Leases. Unless otherwise
defined herein, all capitalized terms used in this Assignment shall have the
meaning given to such term in the Agreement, and this Assignment shall be
subject to and qualified by the terms of the Agreement.

            NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound,
the parties agree as follows:

1. Assignment. Assignor hereby assigns, transfers, and conveys to Assignee all
of Assignor's right, title and interest in and to the Service Contracts, Rooms
Agreements and Equipment Leases.

                                      R-1
<PAGE>

2. Assumption. Assignee hereby assumes all liabilities and obligations of
Assignor under the Service Contracts, Rooms Agreements and Equipment Leases
arising from and after the Apportionment Date and agrees to perform all
obligations of Assignor under the Service Contracts, Rooms Agreements and
Equipment Leases.

3. Further Assurances. Assignor covenants with Assignee and Assignee covenants
with Assignor that each will execute or procure any additional documents
necessary to establish the rights of the other hereunder.

4. Counterparts. This Assignment may be executed by the parties in counterparts,
in which event the signature pages thereof shall be combined in order to
constitute a single original document.

5. Binding Effect. This Assignment shall be binding upon and inure to the
benefit of Assignor, Assignee and their respective successors and assigns.

                                      R-2
<PAGE>

            IN WITNESS WHEREOF, the parties have executed this Assignment as of
the date set forth above.

Signed, sealed and delivered
In the presence of:
                                         _____________________________________
                                         a ___________________________________

                                         By: _________________________________
___________________________________      Name: _______________________________
Witness Name: _____________________      Title: ______________________________

                                         (CORPORATE SEAL)

___________________________________
Witness Name: _____________________

                                         _____________________________________
                                         a ___________________________________

                                         By: _________________________________
___________________________________      Name: _______________________________
Witness Name: _____________________      Title: ______________________________

                                         (CORPORATE SEAL)

___________________________________
Witness Name: _____________________

                                      R-3
<PAGE>

                                    EXHIBIT S

           FORM OF ASSIGNMENT AND ASSUMPTION OF DEVELOPMENT AGREEMENT

               ASSIGNMENT AND ASSUMPTION OF DEVELOPMENT AGREEMENT

            THIS ASSIGNMENT AND ASSUMPTION OF DEVELOPMENT AGREEMENT (this
"Assignment") is made and entered into as of the ___day of ________, 200__, by
and between _____________________________, a ____________________having a
mailing address at _____________________________________("Assignor"), and
_________________, a ____________, having a mailing address at
___________("Assignee");

                              W I T N E S S E T H:

            WHEREAS, Assignor and Assignee are parties to that certain Purchase
and Sale Agreement dated _________ __, 200__ (the "Agreement"), pursuant to
which Seller has agreed, among other things, to sell, assign, transfer and
convey to Assignee the Property (as defined in the Agreement); and

            WHEREAS, in connection with the sale and purchase of the Property,
Assignor has agreed to assign to Assignee all of Assignor's right, title and
interest in and to, and Assignee has agreed to assume from Assignor all of
Assignor's obligations and liabilities under, the Development Agreement arising
from and after Apportionment Date. Unless otherwise defined herein, all
capitalized terms used in this Assignment shall have the meaning given to such
term in the Agreement, and this Assignment shall be subject to and qualified by
the terms of the Agreement.

            NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound,
the parties agree as follows:

1. Assignment. Assignor hereby assigns, transfers, and conveys to Assignee all
of Assignor's right, title and interest in and to the Development Agreement.

2. Assumption. Assignee hereby assumes all liabilities and obligations of
Assignor under the Development Agreement which arise from and after the
Apportionment Date and agrees to perform all obligations of Assignor under the
Development Agreement.

                                      S-1
<PAGE>

3. Further Assurances. Assignor covenants with Assignee and Assignee covenants
with Assignor that each will execute or procure any additional documents
necessary to establish the rights of the other hereunder.

4. Counterparts. This Assignment may be executed by the parties in counterparts,
in which event the signature pages thereof shall be combined in order to
constitute a single original document.

5. Binding Effect. This Assignment shall be binding upon and inure to the
benefit of Assignor, Assignee and their respective successors and assigns.

            IN WITNESS WHEREOF, the parties have executed this Assignment as of
the date set forth above.

Signed, sealed and delivered
In the presence of:
                                         ______________________________________
                                         a ____________________________________

                                         By: __________________________________
___________________________________      Name: ________________________________
Witness Name: _____________________      Title: _______________________________

                                         (CORPORATE SEAL)

___________________________________
Witness Name: _____________________

                                         ______________________________________
                                         a ____________________________________

                                         By: __________________________________
___________________________________      Name: ________________________________
Witness Name: _____________________      Title: _______________________________

                                         (CORPORATE SEAL)

___________________________________
Witness Name: _____________________

                                      S-2
<PAGE>

                            ACKNOWLEDGED AND AGREED:

      The undersigned hereby consents to the foregoing Assignment and Assumption
of Development Agreement.

WITNESS:                                 [____________________________]

__________________________               By:_____________________(SEAL)
                                              Name:____________________
                                              Title: Vice President

                                      S-3
<PAGE>

                                    EXHIBIT T

                            FORM OF OWNER'S AFFIDAVIT

                                OWNER'S AFFIDAVIT

      The undersigned hereby certifies to First American Title Insurance Company
(the "TITLE COMPANY") that:

      1. The undersigned is the owner of the property described on EXHIBIT A"
attached hereto and by this reference made a part hereof (the "SUBJECT
PROPERTY").

      2. To the actual knowledge of the undersigned, except for work that has
been performed or is currently being performed or supplies that have been
furnished or are currently being furnished by the materialmen, suppliers and
contractors identified on Schedule 1 attached hereto, there are no past due
bills for the performance of labor at, or the provision of materials or supplies
for, the Subject Property performed or provided at the written request, or with
the written approval, of the undersigned.

      3. The undersigned has not entered into any mortgages encumbering the
Subject Property or improvements thereon that have not been fully performed or
satisfied or released, except as set forth in that certain title commitment (the
"TITLE COMMITMENT") dated [_________________], 2005, issued by the Title Company
and identified as No. [___________].

      4. The undersigned is not a party to any proceedings by any agency or
authority, public or private, that levies taxes or assessments, which may result
in an increase in taxes or assessments affecting the Subject Property for any
period prior to the date hereof and which are not shown by the public records.

      5. The only permitted occupants of the Subject Property are hotel guests
and tenants under leases (and their subtenants) with rights of possession only,
which leases are listed on the lease summary attached as Schedule 2, and any
person or entity identified on Schedule B to the Title Commitment. The
undersigned has not entered into any options to purchase the Subject Property or
rights of first refusal to purchase the Subject Property either pursuant to
written leases or by separate agreements.

      6. The undersigned has not entered into any unrecorded sale contracts,
deeds, mortgages or purchase options affecting the Subject Property or
improvements thereon, which are presently in effect and will survive the
transfer to [__________], a [_________] ("BUYER"), except as set forth in the
Title Commitment and except for the purchase agreement with and deed to Buyer.

                                      T-1
<PAGE>

      7. That there are no suits, judgments, bankruptcies or executions pending
against the undersigned in any court whatever that could in any way affect the
title to the Subject Property or constitute a lien thereon. The undersigned does
not intend to file bankruptcy under the US Code and the present transaction
involving the sale of the subject Property is not made for purposes of
hindering, delaying or defrauding any creditors of the undersigned.

                                      T-2
<PAGE>

      The undersigned makes these statements for the purpose of inducing the
Title Company to issue the endorsements to one or more of the owner's policy
issued pursuant to the Title Commitment.

      This Certificate is dated as of the ___ day of [__________], 2005.

                                         _________________________________,
                                         a _______________________________

                                         By:   _______________________
                                         Name: _______________________
                                         Title:_______________________

STATE OF _______________
COUNTY OF ______________

            The foregoing instrument was acknowledged before me this ___ day of
________________, 20__ by ___________________, as ___________ of
__________________________, a ____________________, on behalf of the
_____________. He (She) is personally known to me or has produced
_______________________ as identification.

                                         ___________________________________
(NOTARY SEAL)                                Notary Public Signature

                                         ___________________________________
                                         Typed or Printed Notary Name
                                         Notary Public-State of_____________
                                         Commission No.:____________________
                                         My Commission Expires:_____________

                                      T-3
<PAGE>

                                    EXHIBIT U

                           FORM OF FIRPTA CERTIFICATE

                       CERTIFICATION OF NON-FOREIGN STATUS

            Section 1445 of the Internal Revenue Code provides that a transferee
(buyer) of a U.S. real property interest must withhold tax if the transferor
(seller) is a foreign person. To inform the transferee (buyer) that withholding
of tax is not required upon the disposition of a U.S. real property interest by
_______________________________________, a ______________________ ("SELLER"),
the undersigned hereby certifies the following on behalf of Seller:

            1. Seller is not a foreign corporation, foreign partnership, foreign
trust, or foreign estate (as those terms are defined in the Internal Revenue
Code and Income Tax Regulations). Seller is not a "disregarded entity" (as such
term is defined in the Internal Revenue Code and Income Tax Regulations).

            2. Seller's U.S. employer identification number is
[_______________].

            3. Seller's office address is: _____________________________________

            4. Seller understands that this certification may be disclosed to
the Internal Revenue Service by the transferee (buyer) and that any false
statement contained herein could be punished by fine, imprisonment, or both.

            Under penalties of perjury, the undersigned declares that he has
examined this certification and to the best of his knowledge and belief it is
true, correct and complete, and he further declares that he has the authority to
sign this document on behalf of Seller.

            Dated as of the __ day of _________________, 200__.

                                                 SELLER:

                                         __________________________________,
                                         a _________________________________

                                         By:    ____________________________
                                         Name:  ____________________________
                                         Title: ____________________________

                                      U-1
<PAGE>

                                    EXHIBIT V

                ASSIGNMENT AND ASSUMPTION OF MANAGEMENT AGREEMENT

      THIS ASSIGNMENT AND ASSUMPTION OF MANAGEMENT AGREEMENT (this "Agreement")
is made as of _____________, 20___ (the "Effective Date"), by and between
_______________________ ("Assignor") and ________________________ ("Assignee").

                                    RECITALS:

      A. Assignor and ___________________________ ("MANAGER") are parties to
that certain Management Agreement, dated as of __________________, relating to
the _________________________ (the "HOTEL") (the "MANAGEMENT AGREEMENT").

      B. Assignor is conveying all of its right, title and interest in and to
the Hotel to Assignee as of the date hereof.

      C. Assignor desires to assign to Assignee all of Assignor's right, title
and interest in and to the Management Agreement, and Assignee desires to assume
the rights and obligations of Assignor with respect to the Management Agreement.

      NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Assignor and Assignee hereby agree as follows:

      1. Assignment. Assignor hereby sells, assigns, conveys, transfers and
grants to Assignee all of Assignor's right, title and interest in, to and under
the Management Agreement.

      2. Assumption. Assignee hereby accepts all of Assignor's right, title and
interest in, to and under the Management Agreement, agrees to be bound by the
Management Agreement, and assumes all the duties, obligations and liabilities of
Assignor under or with respect to the Management Agreement.

      3. Indemnity. Assignor hereby agrees to protect, indemnify, defend and
hold Assignee harmless from and against any and all claims, damages, losses,
liabilities, costs and expenses (including reasonable attorneys' fees) arising
out of or relating to the Management Agreement and accruing prior to the
Effective Date. Assignee hereby agrees to protect, indemnify, defend and hold
Assignor harmless from and against any and all claims, damages, losses,
liabilities, costs and expenses (including reasonable attorneys' fees) arising
out of or relating to the Management Agreement and accruing on or after the
Effective Date.

      4. Further Assurances. Promptly upon request of the other party, Assignor
and Assignee shall each execute, acknowledge (as appropriate) and deliver to the
other such further assurances and take such further actions as may be reasonably
required or appropriate to perfect the assignment and assumption of the
Management Agreement and

                                       V-1
<PAGE>

otherwise carry out the intent and purpose of this Agreement, provided that
neither party shall incur any material additional cost, expense or obligation in
connection with any act that the other party may request.

      5. Binding Effect. The terms, covenants, conditions and obligations
imposed upon each party herein shall be binding upon the successors and assigns
of such party.

      6. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, and all of which
shall constitute one and the same instrument. Such executed counterparts may be
delivered by facsimile which, upon transmission to the other party, shall have
the same force and effect as delivery of the original signed counterpart. The
submission of an unsigned copy of this Agreement or an electronic instrument
with or without electronic signature to either party shall not constitute an
offer or acceptance. This Agreement shall become effective and binding only upon
execution and delivery of this Agreement in non-electronic form by both parties
in accordance with this Section.

                        [Signatures follow on next page]

                                      V-2
<PAGE>

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

                                    ASSIGNOR:

WITNESS:  [_________________________]

___________________________________      By:______________________________(SEAL)
                                             Name:  ___________________________
                                             Title: ___________________________

                                    ASSIGNEE:

WITNESS:  [_________________________]

___________________________________      By:______________________________(SEAL)
                                              Name:  __________________________
                                              Title: __________________________

                            ACKNOWLEDGED AND AGREED:

      The undersigned, as Manager of the Hotel, hereby consents to the foregoing
Assignment and Assumption of Management Agreement.

                                    MANAGER:

WITNESS: [__________________________]

___________________________________      By:______________________________(SEAL)
                                              Name:  __________________________
                                              Title: Vice President

                                       V-3
<PAGE>

                                    EXHIBIT W

                FORM OF ASSIGNMENT AND ASSUMPTION OF SPACE LEASES

                    ASSIGNMENT AND ASSUMPTION OF SPACE LEASES

      THIS ASSIGNMENT AND ASSUMPTION OF SPACE LEASES (this "Assignment") is made
and entered into as of the ___day of _________, 200__, by and between
_____________________________, a ____________________having a mailing address at
_____________________________________("Assignor"), and _________________, a
____________, having a mailing address at ___________("Assignee");

                              W I T N E S S E T H:

            WHEREAS, Assignor and Assignee are parties to that certain Purchase
and Sale Agreement dated _________ __, 200__ (the "Agreement"), pursuant to
which Assignor has agreed, among other things, to sell, assign, transfer and
convey to Assignee the Property (as defined in the Agreement); and

            WHEREAS, in connection with the sale and purchase of the Property,
Assignor has agreed to assign to Assignee all of Assignor's right, title and
interest in and to the Space Leases, and Assignee has agreed to assume from
Assignor all of Assignor's obligations and liabilities arising from and after
the Apportionment Date with respect to the Space Leases. Unless otherwise
defined herein, all capitalized terms used in this Assignment shall have the
meaning given to such term in the Agreement, and this Assignment shall be
subject to and qualified by the terms of the Agreement.

            NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound,
the parties agree as follows:

1. Assignment. Assignor hereby assigns, transfers, and conveys to Assignee all
of Assignor's right, title and interest in and to the Space Leases.

2. Assumption. Assignee hereby assumes all liabilities and obligations of
Assignor under the Space Leases arising from and after the Apportionment Date
and agrees to perform all obligations of Assignor under the Leases.

3. Further Assurances. Assignor covenants with Assignee and Assignee covenants
with Assignor that each will execute or procure any additional documents
necessary to establish the rights of the other hereunder.

                                       W-1
<PAGE>

4. Counterparts. This Assignment may be executed by the parties in counterparts,
in which event the signature pages thereof shall be combined in order to
constitute a single original document.

5. Binding Effect. This Assignment shall be binding upon and inure to the
benefit of Assignor, Assignee and their respective successors and assigns.

            IN WITNESS WHEREOF, the parties have executed this Assignment as of
the date set forth above.

Signed, sealed and delivered
In the presence of:
                                         ______________________________________
                                         a ____________________________________

                                         By: __________________________________
___________________________________      Name: ________________________________
Witness Name: _____________________      Title: _______________________________

                                         (CORPORATE SEAL)

___________________________________
Witness Name: _____________________

                                         ______________________________________
                                         a ____________________________________

                                         By: __________________________________
___________________________________      Name: ________________________________
Witness Name: _____________________      Title: _______________________________

                                         (CORPORATE SEAL)

___________________________________
Witness Name: _____________________

                                       W-2
<PAGE>

                                    EXHIBIT X

                              FORM OF TENANT NOTICE

[DATE OF SALE CLOSING]

TO:   All Tenants at Grande Lakes Orlando (the "Property")

RE:   [Applicable Leased Space]
      Notification Regarding Change of Ownership

      This letter is to notify you as a Tenant at the Property, that the
Property has been sold by THI III GL Investments L.L.C., a Delaware limited
liability company ("Seller"), to _______________________ ("Purchaser"). As of
the date hereof, your Lease has been assigned by Seller to Purchaser. From the
date of this letter, any and all unpaid rent as well as all future rent, or any
other amounts due under the terms of your Lease, shall be directed as follows:

      TO: __________________________________
      ATTN: ________________________________
      AT: __________________________________

As part of the sale, all refundable tenant deposits, if any, actually held by
Seller with respect to the Property have been transferred to, and Seller's
obligations with respect to such deposits have been assumed by, Purchaser as of
the date of this letter. Any and all payments of rent (or other sums due under
your Lease) hereafter paid to any party other than Purchaser shall not relieve
you of the obligation of making said payment to Purchaser.

                                         SELLER:

                                         THI III GL INVESTMENTS L.L.C.

                                         By: __________________________________
                                         Name: ________________________________
                                         Title: _______________________________

                                      X-1
<PAGE>

                                             PURCHASER:

                                             ___________________________________

                                             By:________________________________
                                             Name:______________________________
                                             Title:_____________________________

                                      X-2

<PAGE>

                                    EXHIBIT Y

                      FORM OF SELLER'S CLOSING CERTIFICATE

                          SELLER'S CLOSING CERTIFICATE

            THIS CLOSING CERTIFICATE is made as of the ____ day of ___________,
200__, by ___________________________________, a ___________________ (the
"SELLER"), to __________________________________, a _________________________ (
the "BUYER").

                                R E C I T A L S:

            A. Pursuant to that certain Purchase Agreement dated as of
____________ __, 200__ between Seller and Buyer (together with all amendments
and addenda thereto, the "AGREEMENT"), Seller has agreed to sell to Buyer the
Property (as defined in the Agreement).

            B. The Agreement requires the delivery of this Closing Certificate.
Unless otherwise defined herein, all capitalized terms used in this Assignment
shall have the meaning given to such term in the Agreement.

            NOW THEREFORE, pursuant to the Agreement, Seller does hereby
represent and warrant to Buyer that:

            1. All of the representations and warranties of Seller contained in
Article III of the Agreement are correct, in all material respects, as of the
Closing Date as if made on and as of the Closing Date.

            2. This Certificate is subject to the terms and conditions of the
Agreement.

            IN WITNESS WHEREOF, the undersigned has executed this Certificate as
of the day and year first above written.

                                      SELLER:

                                      __________________________________,
                                      a _______________________________

                                      By:   ____________________________
                                      Name:_____________________________
                                      Title: ___________________________

                                      Y-1
<PAGE>

                                    EXHIBIT Z

                     FORM OF PURCHASER'S CLOSING CERTIFICATE

                         PURCHASER'S CLOSING CERTIFICATE

            THIS CLOSING CERTIFICATE is made as of the ___ day of
______________, 200__, by ____________________________________, a
_______________________ (the "PURCHASER"), to _______________________________, a
____________________________ (the "SELLER").

                                R E C I T A L S:

            A. Pursuant to that certain Purchase Agreement dated as of
_____________ __, 200__ between Seller and Purchaser (together with all
amendments and addenda thereto, the "AGREEMENT"), Seller has agreed to sell to
Purchaser the Property (as defined in the Agreement).

            B. The Agreement requires the delivery of this Closing Certificate.
Unless otherwise defined herein, all capitalized terms used in this Assignment
shall have the meaning given to such term in the Agreement.

            NOW THEREFORE, pursuant to the Agreement, Purchaser does hereby
represent and warrant to Seller that:

            1. All of the representations and warranties of Purchaser contained
in Article IV of the Agreement are correct, in all material respects, as of the
Closing Date hereof as if made on and as of the Closing Date.

            2. This Certificate is subject to the terms and conditions of the
Agreement.

            IN WITNESS WHEREOF, the undersigned has executed this Certificate as
of the day and year first above written.

                                             PURCHASER:

                                             ________________________________,
                                             a ______________________________

                                             By:_____________________________
                                             Name:___________________________
                                             Title:__________________________

                                      Z-1
<PAGE>

                                   EXHIBIT AA

                              SCHEDULED PERSONALTY

11th  Hour (JW)-Business Center

   -  2 Dell Computers

   -  3 HP Printers/Fax

   -  1 Epson Printer

   -  1 Brother Copy Machine

   -  1 E Machine

   -  4 Credit Card Machines

   -  2 Thermal Printers

   -  1 Xerox 265 Copier

11th Hour - Business Center (Ritz-Carlton)

   -  Xerox Copier 265 DL

   -  HP Laser Jet 4000 Printer

   -  HP Laser Jet 1100 Printer

   -  HP 1040 Fax Machine

   -  Epson Stylus C62 Printer

   -  Lexmark Printer

   -  Sharp - Fax Machine

   -  3 Dell Computers

   -  4 Credit Card Machines

   -  3 Thermal Printers

Buena Vista Concessions, Inc. (JW/Ritz)

   -  5 Multi seat bicycles

   -  6 Regular bicycles

Hello Florida, Inc.(JW/Ritz)

   -  Computer, printer

Hertz

   -  Furniture

   -  Computer, printer

JCorl Inc. dba John Craig (JW)

   -  All fixtures in store are the property of John Craig excluding POS
      terminal, picture behind register, and mirror

Lowe and Behold Event Accents, LLC-Floral Shop (JW/Ritz)

                                      AA-1
<PAGE>

   -  Fax Machine

   -  Vases

Mears (JW/Ritz)

   -  1 Computer

   -  1 Printer

Mimi's Boutique, Inc.(JW)

   -  All fixtures in store and POS computer

MVCI (JW)

   -  2 Sales desks

My Three Sons (JW)

   -  1 Soap Dispenser - 3rd Floor JW

   -  1 Sink

   -  3 Whirlpool Washers on guest floors

   -  3 Whirlpool Dryers on guest floors

My Three Sons (JW)

   -  Guest Floors vending equipment & Employee Cafeteria Vending Machines

My Three Son's (JW)

   -  7 Arcade Machines:

         1  Air Hockey

         2  Foosball,

         3  Pacman

         4  Cruisin Exotica

         5  Beachhead

         6  Batman

         7  Time Crisis

   -  1 Token Machine

Arcade machines are periodically changed, per the agreement with My Three Son's

Nat Landau Hyman Jewels, Ltd (JW)

   -  All fixtures in store

New World Orlando LLC dba Normans (Ritz)

   -  All Food & Beverage Inventories

   -  China

   -  Glassware

   -  Flatware

                                      AA-2
<PAGE>

   -  Dining Room Smallwares

   -  Bar & Lounge Smallwares

   -  All Artwork

   -  Kitchen Smallwares

   -  Kitchen Small Equipment

   -  Paper Inventory

   -  Chemical Inventory

   -  Office Supplies

   -  Office Equipment

   -  Linen Inventory

   -  Uniform Inventory

   -  All marketing materials relating to the restaurant

   -  Chef Norman Van Aken's cookbooks

   -  dining room furniture

   -  patio furniture

   -  point of sale system

   -  office computer systems

   -  all logo materials o name, brand, logos and likenesses

   -  all intellectual property

Peet's Coffee (Ritz)

   -  Espresso Machine

Proprietary software and technology (JW/Ritz)

   -  Including but not limited to PeopleSoft, PMS, NGS, Delphi. These items are
      discussed in the management agreement.

Towne Park (JW)

   -  5 Computers (IBM & Dell)

   -  1 Printer

   -  2 Cash Registers

TownPark (Ritz)

   -  1 Computer

   -  1 Printer

   -  1 Cash Register

Trade Winds (JW)

   -  JW Pool Towel Hut concession toys (i.e rafts, Styrofoam noodles,
      intertubes)

Universal Money Centers (JW/Ritz)

   -  2 ATM machines (1 at each hotel)

                                      AA-3
<PAGE>

United Temps-overnight cleaner (JW/Ritz)

   -  2 Storage Containers in Loading Dock Area (containers include all
      equipment used by the 3rd shift cleaners which includes but is not limited
      to floor buffers, trash cans, mops, brooms, and cleaning chemicals).

Vila and Son Landscape Co., Inc (JW/Ritz).

   -  One metal storage container approximately 8'x20'x8'

   -  One metal tandem axle trailer approximately 7'x16'x7'

   -  Two Hustler Excel "Super Z" 48" riding lawn mowers

   -  Eight string trimmer/edgers

   -  One power shrub trimmer

   -  Three back pack blowers

   -  Two back pack sprayers (5 gallon)

   -  One electric sprayer (25 gallon)

   -  Two Kawasaki Mule utility vehicles

   -  One F-250 Ford diesel pick up truck

   -  Ten fuel cans (2-5 gallon capacity)

   -  Assorted hand tools such as shovels, rakes, machetes, etc

                                      AA-4
<PAGE>

                                   EXHIBIT BB

                               PROPERTY DOCUMENTS

<TABLE>
<CAPTION>
Date                       Description
<S>             <C>
03/06/92        Concurrency Vested Rights Certificate #92-000212

05/14/92        Agreement between Orlando Resort A and Valencia Water Control District ["VWCD"] (C-7 canal)

05/14/92        Agreement between Orlando Resort A and VWCD (C-8 Canal)

01/28/93        Development Agreement (between Orlando Resorts A & B and Williamsburg Commercial Limited Partnership ["WCLP"])

03/02/93        Amendment to Development Agreement (Orlando Resorts A & WCLP)

06/29/93        Execution of COE Permits to fill C-7 and C-8 Canals

07/19/93        Attachment to Florida Power Authorization and Agreement

03/12/98        Amended and Restated Agreement (Regarding Canal C-7 and Canal C-8) (VWCD/Orlando Resorts A & B)

4/11/00         Special Warranty Deed by VWCD to SC Orlando, L.L.C.

08/15/00        General Warranty Deed by SC Orlando to Orange County

09/12/00        Non Exclusive  Drainage  Easement and Joint  Utilization  Agreement between SC Orlando and Orange County

10/10/00        Canal Crossing Easement (VWCD to SC Orlando)

06/09/03        Right-of-Way Deed (Right Turn Lane onto JYP)

06/09/03        Right-of-Way Deed (Resort Entrance Acceleration/Deceleration)

06/09/03        Right-of-Way Deed (Excess Lane Entrance Acceleration/Deceleration)

06/09/03        Potable Water and Reclaimed Water Systems Bill of Sale

12/00/03        Settlement Agreement (Marriott/WCLP/JY&CFP)

08/06/04        Joinder and Consent to Dedication (Plat of Grande Lakes Resort)
</TABLE>

                                      BB-1
<PAGE>

<TABLE>
<S>             <C>
07/16/99        Binding Letter Issued to Miranda Fitzgerald for Project ABC

7/18/03         Project ABC 1999 Amended Land Use Plan dated 5/19/99, revised 7/18/03

04/19/05        Binding Letter Issued to Jim Hall for Project ABC and Amended Land Use Plan dated 7/19/05, Revised: 8/30/05
                and 9/19/05

04/03/92        Letter from Orange County regarding Application for Consistency Vested rights and explanatory memo to Tom
                Schneider

08/13/04        Agreement Regarding Allocation and Assignment of Development Rights and Entitlements (Regarding In-Parcels)
                between THI III GL Land and SC Orlando

08/13/04        Assignment of Developer's Interest Under Declaration of CCR's,  Easements and  Reservations for Grande Lakes
                Master Stormwater Management System between THI III GL Land and SC Orlando
</TABLE>

                                      BB-2
<PAGE>

                                   EXHIBIT CC

                              OPERATING STATEMENTS

2003
Owner Consolidated P&L Statement Period 13 2003 as of January 2, 2004
  (GLO-Consolidated)
Owner Consolidated P&L Statement Period 13 2003 as of January 2, 2004 (JW)
Owner Consolidated P&L Statement Period 13 2003 as of January 2, 2004 (Ritz)
Owner Consolidated P&L Statement Period 13 2003 as of January 2, 2004
  (Ritz Golf)
Format 98 P&L Statement Period 13 2003 as of January 2, 2004 (JW)
Format 98 P&L Statement Period 13 2003 as of January 2, 2004 (Ritz)
Format 98 P&L Statement Period 13 2003 as of January 2, 2004 (Ritz Golf)

2004
Owner Consolidated P&L Statement Period 10 2004 as of October 8, 2004
  (GLO-Consolidated)
Owner Consolidated P&L Statement Period 10 2004 as of October 8, 2004 (JW)
Owner Consolidated P&L Statement Period 10 2004 as of October 8, 2004 (Ritz)
Owner Consolidated P&L Statement Period 10 2004 as of October 8, 2004
  (Ritz Golf)
Owner Consolidated P&L Statement Period 11 2004 as of November 5, 2004
  (GLO-Consolidated)
Owner Consolidated P&L Statement Period 11 2004 as of November 5, 2004 (JW)
Owner Consolidated P&L Statement Period 11 2004 as of November 5, 2004 (Ritz)
Owner Consolidated P&L Statement Period 11 2004 as of November 5, 2004
(Ritz Golf)
Owner Consolidated P&L Statement Period 12 2004 as of December 3, 2004
(GLO-Consolidated)
Owner Consolidated P&L Statement Period 12 2004 as of December 3, 2004 (JW)
Owner Consolidated P&L Statement Period 12 2004 as of December 3, 2004 (Ritz)
Owner Consolidated P&L Statement Period 12 2004 as of December 3, 2004
  (Ritz Golf)
Owner Consolidated P&L Statement Period 13 2004 as of December 31, 2004
  (GLO-Consolidated)
Owner Consolidated P&L Statement w/ Detail Period 13 2004 as of December 31,
  2004 (JW)
Owner Consolidated P&L Statement w/Detail Period 13 2004 as of December 31, 2004
  (Ritz)
Owner Consolidated P&L Statement w/Detail Period 13 2004 as of December 31, 2004
  (Ritz Golf)
Format 98 P&L Statement Period 13 2004 as of December 31, 2004 (JW)
Format 98 P&L Statement Period 13 2004 as of December 31, 2004 (Ritz)
Format 98 P&L Statement Period 13 2004 as of December 31, 2004 (Ritz Golf)

2005
Owner Consolidated P&L Statement Period 1 2005 as of January 28, 2005
(GLO-Consolidated)
Owner Consolidated P&L Statement Period 1 2005 as of January 28, 2005 (JW)
Owner Consolidated P&L Statement Period 1 2005 as of January 28, 2005 (Ritz)
Owner Consolidated P&L Statement Period 1 2005 as of January 28, 2005
  (Ritz Golf)
Owner Consolidated P&L Statement Period 2 2005 as of February 25, 2005
  (GLO-Consolidated)
Owner Consolidated P&L Statement Period 2 2005 as of February 25, 2005 (JW)
Owner Consolidated P&L Statement Period 2 2005 as of February 25, 2005 (Ritz)
Owner Consolidated P&L Statement Period 2 2005 as of February 25, 2005
  (Ritz Golf)
Owner Consolidated P&L Statement Period 3 2005 as of March 25, 2005
  (GLO-Consolidated)
Owner Consolidated P&L Statement Period 3 2005 as of March 25, 2005 (JW)
Owner Consolidated P&L Statement Period 3 2005 as of March 25, 2005 (Ritz)
Owner Consolidated P&L Statement Period 3 2005 as of March 25, 2005
  (Ritz Golf)
Owner Consolidated P&L Statement Period 4 2005 as of April 22, 2005
  (GLO-Consolidated)

                                      CC-1
<PAGE>

Owner Consolidated P&L Statement Period 4 2005 as of April 22, 2005 (JW)
Owner Consolidated P&L Statement Period 4 2005 as of April 22, 2005 (Ritz)
Owner Consolidated P&L Statement Period 4 2005 as of April 22, 2005 (Ritz Golf)
Owner Consolidated P&L Statement Period 5 2005 as of May 20, 2005
  (GLO-Consolidated)
Owner Consolidated P&L Statement Period 5 2005 as of May 20, 2005 (JW)
Owner Consolidated P&L Statement Period 5 2005 as of May 20, 2005 (Ritz)
Owner Consolidated P&L Statement Period 5 2005 as of May 20, 2005 (Ritz Golf)
Owner Consolidated P&L Statement Period 6 2005 as of June 17, 2005
(GLO-Consolidated)
Owner Consolidated P&L Statement Period 6 2005 as of June 17, 2005 (JW)
Owner Consolidated P&L Statement Period 6 2005 as of June 17, 2005 (Ritz)
Owner Consolidated P&L Statement Period 6 2005 as of June 17, 2005 (Ritz Golf)
Owner Consolidated P&L Statement Period 7 2005 as of July 15, 2005
  (GLO-Consolidated)
Owner Consolidated P&L Statement Period 7 2005 as of July 15, 2005 (JW)
Owner Consolidated P&L Statement Period 7 2005 as of July 15, 2005 (Ritz)
Owner Consolidated P&L Statement Period 7 2005 as of July 15, 2005 (Ritz Golf)
Owner Consolidated P&L Statement Period 8 2005 as of August 12, 2005
  (GLO-Consolidated)
Owner Consolidated P&L Statement Period 8 2005 as of August 12, 2005 (JW)
Owner Consolidated P&L Statement Period 8 2005 as of August 12, 2005 (Ritz)
Owner Consolidated P&L Statement Period 8 2005 as of August 12, 2005 (Ritz Golf)
Owner Consolidated P&L Statement Period 9 2005 as of September 9, 2005
  (GLO-Consolidated)
Owner Consolidated P&L Statement Period 9 2005 as of September 9, 2005 (JW)
Owner Consolidated P&L Statement Period 9 2005 as of September 9, 2005 (Ritz)
Owner Consolidated P&L Statement Period 9 2005 as of September 9, 2005
  (Ritz Golf)
Owner Consolidated P&L Statement Period 10 2005 as of October 7, 2005
  (GLO-Consolidated)
Owner Consolidated P&L Statement Period 10 2005 as of October 7, 2005 (JW)
Owner Consolidated P&L Statement Period 10 2005 as of October 7, 2005, (Ritz)
Owner Consolidated P&L Statement Period 10 2005 as of October 7, 2005
  (Ritz Golf)
Owner Consolidated P&L Statement Period 11 2005 as of November 4, 2005
  (GLO-Consolidated)
Owner Consolidated P&L Statement Period 11 2005 as of November 4, 2005 (JW)
Owner Consolidated P&L Statement Period 11 2005 as of November 4, 2005, (Ritz)
Owner Consolidated P&L Statement Period 11 2005 as of November 4, 2005
  (Ritz Golf)
Owner Consolidated P&L Statement Period 12 2005 as of December 2, 2005
  (GLO-Consolidated)
Owner Consolidated P&L Statement Period 12 2005 as of December 2, 2005 (JW)
Owner Consolidated P&L Statement Period 12 2005 as of December 2, 2005, (Ritz)
Owner Consolidated P&L Statement Period 12 2005 as of December 2, 2005
  (Ritz Golf)
Format 98 P&L Statement Period 12 2005 as of December 2, 2005 (JW)
Format 98 P&L Statement Period 12 2005 as of December 2, 2005 (Ritz)
Format 98 P&L Statement Period 12 2005 as of December 2, 2005 (Ritz Golf)

                                      CC-2
<PAGE>

                                   EXHIBIT DD

                            AMENDMENT TO DECLARATION

THIS INSTRUMENT WAS PREPARED BY AND
UPON RECORDATION SHOULD BE RETURNED TO:

RENA HOZORE REISS, ESQ.
MARRIOTT INTERNATIONAL, INC.
DEPARTMENT 52/923
10400 FERNWOOD ROAD
BETHESDA, MARYLAND  20817

CLARIFICATION AND AMENDMENT TO
DECLARATION OF COVENANTS, CONDITIONS,
RESTRICTIONS, EASEMENTS AND RESERVATIONS
FOR
GRANDE LAKES RESORT
ORLANDO, FLORIDA

            THIS CLARIFICATION AND AMENDMENT TO DECLARATION is dated as of this
____ day of ______________, 2006, by THI III GL INVESTMENTS L.L.C., a Delaware
limited liability company (hereinafter referred to as "Declarant"), GRANDE LAKES
RESORT PROPERTY OWNERS ASSOCIATION, INC., a Florida corporation non-for profit
(hereinafter referred to as "ASSOCIATION") and SC ORLANDO L.L.C., a Delaware
limited liability company (hereinafter referred to as "SC ORLANDO").

                                   WITNESSETH:

            WHEREAS, Declarant recorded that certain Declaration of Covenants,
Conditions, Restrictions, Easements and Reservations for Grande Lakes Resort,
Orlando, Florida, dated as of April 1, 2004 (the "DECLARATION") in the land
records of Orange County on August 6, 2004 at Official Records Book 07565, at
Page 1177, et seq., as Instrument Number 20040510955;

            WHEREAS, in order to confirm the parties' understandings with
respect to certain provisions of the Declaration, Declarant, the Association and
SC Orlando desire to clarify and amend the Declaration on the terms set forth
herein.

            NOW, THEREFORE, for and in consideration of the premises hereof, and
for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:

                                      DD-1

<PAGE>

            1. All capitalized terms used herein and not otherwise defined shall
have the meanings set forth in the Declaration.

            2. Declarant, the Association and SC Orlando, as the Owners of the
Resort Site Components, are making this Clarification and Amendment to
Declaration pursuant to Article XVIII of the Declaration.

            3. Section 6.6 of the Declaration is hereby deleted in its entirety
and the following is inserted in lieu thereof:

                        6.6 RESORT RESIDENTIAL PROPERTY. Resort Residential
                  Property shall be developed and improved as and used,
                  occupied, maintained and enjoyed solely and exclusively for
                  single family resort residential dwelling and related uses and
                  purposes, for interval ownership (sometimes referred to as
                  "time-share" or "fractional interest"), multi-family
                  residential dwelling and other ancillary and/or customarily
                  related recreational uses and activities, including, without
                  limitation, tennis courts and swimming pools, and related
                  garages, parking areas and other amenities in support of the
                  same and for no other uses or purposes whatever, consistent
                  with, in all respects, first-class hotel and resort
                  residential properties in the Orlando, Florida metropolitan
                  area compatible with the standard and character of the Hotels.
                  In addition, no Owner of a Resort Residential Property or
                  Residential Unit Owner may use, develop or subdivide such
                  Resort Residential Property (or permit the use, development or
                  subdivision thereof) for any of the uses or activities listed
                  in EXHIBIT Q; provided, however, that nothing in this Section
                  6.6 or Exhibit Q shall prohibit the rental to transient guests
                  of any interval ownership units developed by Marriott
                  International, Inc., or any of its Affiliates. With respect to
                  the Residential Component South, any development thereon shall
                  include a swimming pool for the use of the residents thereof
                  (which swimming pool shall be constructed and placed in
                  service by the completion of that phase of the development of
                  the Residential Component South which results in Substantial
                  Completion of Construction of more than fifty percent (50% )
                  of the units legally permissible for, and intended to be
                  developed on, the Residential Component South). With respect
                  to the Residential Component

                                      DD-2
<PAGE>

                  North, any development thereon shall include a swimming pool
                  for the use of the residents thereof (which swimming pool
                  shall be constructed and placed in service by the completion
                  of that phase of the development of the Residential Component
                  North which results in Substantial Completion of Construction
                  of more than fifty percent (50% ) of the units legally
                  permissible for, and intended to be developed on, the
                  Residential Component North).

      4. NO FURTHER MODIFICATION. Except as otherwise expressly clarified and
amended hereby, all of the terms and provisions of the Declaration remain
unmodified and in full force and effect.

      5. COUNTERPARTS. The parties may execute this Clarification and Amendment
to Declaration in any number of counterparts, each of which shall be deemed to
constitute an original and all of which, when taken together, shall constitute
one and the same document.

                      [Signature blocks begin on next page]

                                      DD-3
<PAGE>

            IN WITNESS WHEREOF, the parties hereto have executed this
Clarification and Amendment to Declaration as of the date first above written.

Signed, sealed and delivered in the         THI III GL INVESTMENTS L.L.C., a
presence of the following witnesses:        Delaware limited liability company

_________________________                   By: _______________________
Signature of Witness                        Name: _____________________
                                            Title: ____________________
_________________________
Name of Witness

_________________________
Signature of Witness

_________________________
Name of Witness

STATE OF MARYLAND
COUNTY OF ANNE ARUNDEL

            The foregoing instrument was acknowledged before me this ____ day of
______________, 2005, by ___________________________, as _________________ of
THI III GL Investments L.L.C., a Delaware limited liability company, on behalf
of said limited liability company. He is personally known to me or has produced
____________________ as identification.

                                            ____________________________________
                                            Printed Name: ______________________
                                            Notary Public - State of Maryland

                                            Commission No. _____________________
                                            My commission expires: _____________

(NOTARIAL SEAL)

                                      DD-4
<PAGE>

Signed, sealed and delivered in the         GRANDE LAKES RESORT PROPERTY OWNERS
presence of the following witnesses:        ASSOCIATION, INC., a Florida
                                            corporation not-for-profit

_________________________                   By: _______________________
Signature of Witness                        Name: _____________________
                                            Title: ____________________
_________________________
Name of Witness

_________________________
Signature of Witness

_________________________
Name of Witness

STATE OF MARYLAND
COUNTY OF ANNE ARUNDEL

            The foregoing instrument was acknowledged before me this ____ day of
______________, 2005, by ___________________________, as _________________ of
Grande Lakes Resort Property Owners Association, Inc., a Florida corporation
not-for-profit, on behalf of said corporation. He is personally known to me or
has produced ____________________ as identification.

                                            ____________________________________
                                            Printed Name: ______________________
                                            Notary Public - State of Maryland

                                            Commission No. _____________________
                                            My commission expires: _____________

(NOTARIAL SEAL)

                                      DD-5
<PAGE>

Signed, sealed and delivered in the         SC ORLANDO L.L.C., a Delaware
presence of the following witnesses:        limited liability company

_________________________                   By: _______________________
Signature of Witness                        Name: _____________________
                                            Title: ____________________
_________________________
Name of Witness

_________________________
Signature of Witness

_________________________
Name of Witness

STATE OF MARYLAND
COUNTY OF ____________________

            The foregoing instrument was acknowledged before me this ____ day of
______________, 2005, by ___________________________, as _________________ of SC
Orlando L.L.C., a Delaware limited liability company, on behalf of said limited
liability company. He is personally known to me or has produced
____________________ as identification.

                                            ____________________________________
                                            Printed Name: ______________________
                                            Notary Public - State of Maryland

                                            Commission No. _____________________
                                            My commission expires: _____________

(NOTARIAL SEAL)

                                      DD-6
<PAGE>

                                   EXHIBIT EE

                   ESCROW INSTRUCTIONS FOR POST-CLOSING ESCROW

                               _____________, 2006

The Talon Group
111 N. Orange Avenue
Suite 1285
Orlando, Florida  32801
Attention:  Michael J. Moore, Esq.

         Re:    Post-Closing Escrow under Purchase and Sale Agreement dated
                December ___, 2005, by and between THI III GL Investments L.L.C.
                ("Seller") and CNL Hotels & Resorts, Inc. ("Original Purchaser")
                (as the same may now or hereafter be amended, the "Agreement")

Gentlemen and Ladies:

      Original Purchaser and Seller entered into the Agreement pursuant to which
Purchaser agreed to purchase the Resort as more particularly set forth in the
Agreement. Pursuant to the Agreement, Original Purchaser has designated
_______________ ("Purchaser") to take title to the Resort. Capitalized terms
used herein without definition shall have the meanings ascribed to them in the
Agreement.

      In accordance with Section 14.7 of the Agreement, Seller is establishing a
post-closing escrow from a portion of the sales proceeds in the amount of
Fifteen Million Dollars ($15,000,000) (which, along with any interest earned
thereon, is hereinafter referred to as the "Post-Closing Escrow"). You are to
hold the Post-Closing Escrow in escrow and deliver it to Seller or Purchaser in
accordance with these instructions.

      If you receive a written statement from Purchaser ("Purchaser's Notice")
that (i) requests payment or reimbursement from the Post-Closing Escrow for
damages arising from a Seller's Post-Closing Obligations under the Agreement,
(ii) specifies the monetary amount of the damages to be paid or reimbursed and
(iii) certifies that a copy of Purchaser's Notice has been delivered to Seller,
on the fourth (4th) business day after receipt of Purchaser's Notice, you shall
deliver the requested amount of the Post-Closing Escrow (by delivering cash,
certified check or some other form of immediately available funds) to Purchaser,
at _________________________,

                                      EE-1
<PAGE>

Attention: _______________, or such other address as Purchaser may request,
except that if you receive written notice from Seller or Seller's counsel within
three (3) business days after receipt of Purchaser's Notice that Seller disputes
Purchaser's right to receive any or all of the Post-Closing Escrow and directs
you not to make the foregoing delivery, you shall not deliver any of the
Post-Closing Escrow to Purchaser but shall instead retain the Post-Closing
Escrow or, if appropriate, interplead and deposit that portion of the
Post-Closing Escrow requested in the corresponding Purchaser's Notice with a
court of competent jurisdiction.

      As of the close of business on September 24, 2006, you shall return the
Post-Closing Escrow, plus any interest thereon, less any Retained Post-Closing
Escrow Funds (defined below) and any other funds that may have been previously
disbursed hereunder (by delivering cash, certified check or some other form of
immediately available funds) to Seller, at c/o Thayer Lodging Group, Inc., 410
Severn Avenue, Suite 314, Annapolis, Maryland 21403, or such other address as
Seller may request. For purposes of these instructions, "Retained Post-Closing
Escrow Funds" shall be funds in the aggregate amount specified in any and all of
the Purchaser's Notices received by you that were not previously distributed to
Purchaser from the Post-Closing Escrow or interpleaded and deposited with a
court of competent jurisdiction, together with any interest earned thereon. You
shall continue to hold the Retained Post-Closing Escrow Funds, if any, in escrow
and shall release them in accordance with either (i) joint instructions signed
by Seller and Purchaser or (ii) a final order from a court of competent
jurisdiction.

      You are not to disclose to any person (other than your attorneys and the
parties hereto, their lenders, employees, agents or independent contractors) any
information about the Agreement or its existence or this letter of instructions
(except as mutually requested by the parties or as may be required by a court in
any litigation or by law).

      You are to maintain the Post-Closing Escrow in a federally-insured
interest-bearing account in a financial institution in the Orlando, Florida
metropolitan area, and all interest accruing thereon (including interest
accruing on any Retained Post-Closing Escrow Funds) shall be added to and become
a part of the Post-Closing Escrow. However, we understand that you assume no
responsibility for, nor will we hold you liable for, any loss accruing due to
bank failure and/or takeover by a federal regulatory agency, or which arises
solely from the fact that the escrow amount exceeds One Hundred Thousand Dollars
($100,000) and that the excess amount is not insured by the Federal Deposit
Insurance Corporation. Nor shall you be required to institute legal proceedings
of any kind pursuant to these instructions, nor be required to defend any legal
proceedings which may be instituted against you with respect to the subject
matter of these instructions unless you are requested to do so by Purchaser or
Seller and arrangements reasonably satisfactory to you have been made to
indemnify you against the cost and expense of such defense by

                                      EE-2
<PAGE>

the party making such request. If any dispute shall arise with respect to these
instructions, whether such dispute arises between the parties hereto or between
the parties hereto and other persons, you may interplead such Post-Closing
Escrow. Title Company shall be responsible only for the performance of such
duties as are strictly set forth herein and in no event shall Title Company be
liable for any act or failure to act under the provisions of this letter except
where such action or inaction is the result of Title Company's willful
misconduct or gross negligence.

      Seller and Purchaser each hereby agrees to indemnify you and hold you
harmless against any loss, liability or damage (including the cost of litigation
and reasonable counsel fees) incurred in connection with the performance of your
duties hereunder except as a result of your willful misconduct or gross
negligence.

      Please indicate your agreement to comply with the foregoing instructions
by executing at least two copies of this letter and returning one to Purchaser's
counsel and one to Seller's counsel.

                                            Very truly yours,

                                            SELLER

WITNESS                                     THI III GL INVESTMENTS, L.L.C.

_________________                           By:_________________________________
                                            Name:_______________________________
                                            Title:______________________________

                                            PURCHASER

WITNESS

                                            By:_________________________________
_________________                           Name:_______________________________
                                            Title:______________________________

ACKNOWLEDGED AND AGREED:

THE TALON GROUP

By:____________________________
Name:__________________________
Its:___________________________

Date:__________________________

                                      EE-3
<PAGE>

                                   EXHIBIT FF

                           ASSIGNMENTS OF DECLARATIONS

This instrument prepared by and
following recordation should be returned to:

_________________________________________
_________________________________________
_________________________________________
_________________________________________

               ASSIGNMENT OF [DEVELOPER'S] [DECLARANT'S] INTEREST
                  UNDER [DECLARATION OF COVENANTS, CONDITIONS,
                  RESTRICTIONS, EASEMENTS AND RESERVATIONS FOR
                GRANDE LAKES MASTER STORMWATER MANAGEMENT SYSTEM]
              [DECLARATION OF COVENANTS, CONDITIONS, RESTRICTIONS,
              EASEMENTS AND RESERVATIONS FOR GRANDE LAKES RESORT]

            This ASSIGNMENT OF [DEVELOPER'S] [DECLARANT'S] INTEREST UNDER
DECLARATION OF COVENANTS, CONDITIONS, RESTRICTIONS, EASEMENTS AND RESERVATIONS
FOR GRANDE LAKES MASTER STORMWATER MANAGEMENT SYSTEM [DECLARATION OF COVENANTS,
CONDITIONS, RESTRICTIONS, EASEMENTS AND RESERVATIONS FOR GRANDE LAKES RESORT]
(hereinafter referred to as the "Assignment") made and executed this ___ day of
__________, 2006 (the "Effective Date") by ___________________________, a
___________________________, whose address for purposes of this instrument is
c/o Thayer Lodging Group, Attn: David J. Weymer, 410 Severn Avenue, Suite 314,
Annapolis, Maryland 21403 (hereinafter referred to as "Assignor") to, and in
favor and for the benefit of ___________________________, a
___________________________, whose address for purposes of this instrument is
c/o _____________________________________________ (hereinafter referred to as
"Assignee"),

                                   WITNESSETH:

            WHEREAS, Assignor is the record owner of that certain real property
located in Orange County, Florida which is legally and more particularly
described on EXHIBIT A attached hereto and made a part hereof (hereinafter
referred to as the "Property"); and

            WHEREAS, Assignor is as of the Effective Date selling, transferring
and conveying the Property, as the same is described on EXHIBIT A, to Assignee
by Special Warranty Deed executed and delivered on or about the Effective Date
and

                                      FF-1
<PAGE>

heretofore recorded or to be hereafter recorded among the Public Records of
Orange County, Florida; and

            WHEREAS, the Property is subject to and encumbered by that certain
[Declaration of Covenants, Conditions, Restrictions, Easements and Reservations
for Grande Lakes Master Stormwater Management System executed by each of SC
Orlando, L.L.C. and Assignor, as "Developers" thereunder, joined by Grande Lakes
Stormwater Management Association, Inc. and recorded on August 7, 2003 as an
instrument 20030444708 in Official Records Book 7038 at Pages 2091 et seq. of
the Public Records of Orange County, Florida (as amended, hereinafter referred
to as the "Stormwater Declaration")] [Declaration of Covenants, Conditions,
Restrictions, Easements and Reservations for Grande Lakes Resort, executed by
Assignor and Grande Lakes Resort Property Owner's Association, Inc., as
"Declarant" thereunder, and recorded on August 4, 2004, as an Instrument
20040510955 in Official Records Book 7568, at Page 1177 et seq. of the Public
Records of Orange County, Florida (as amended, hereinafter referred to as the
"Declaration")]; and

            WHEREAS, [Section 1.13 of the Stormwater Declaration includes a
definition of the term "Developers," as that term is used in the Stormwater
Declaration] [Article 1 of the Declaration includes a definition of the term
"Declarant," as that term is used in the Declaration]; and

            NOW, THEREFORE, for and in consideration of the foregoing premises
of this Assignment, and for other good and valuable considerations, the receipt
and sufficiency of which are hereby acknowledged, Assignor does hereby sell,
transfer and specifically assign to Assignee all of Assignor's respective rights
and all of Assignor's respective duties as a [Developer under the Stormwater
Declaration with respect to the Property] [Declarant under the Declaration] such
that, upon the recordation of both (a) this Assignment and (b) the
above-described Special Warranty Deed from Assignor to Assignee transferring and
conveying title to the Property to Assignee among the Public Records of Orange
County, Florida, Assignee shall thereupon become and thereafter be [one of the
"Developers"] ["Declarant"] as that term is defined in [Section 1.13 of the
Stormwater Declaration] [Article 1 of the Declaration].

            ASSIGNEE, by its execution and delivery of this Assignment, does
hereby accept the within and foregoing assignment of all of Assignor's
respective rights and does hereby assume all of Assignor's respective duties as
a [Developer under the Stormwater Declaration with respect to the Property]
[Declarant under the Declaration] and hereby agrees to become [one of the
"Developers,"] ["Declarant"] as that term is defined in [Section 1.13 of the
Stormwater Declaration,] [Article 1 of the Declaration].

                         [SIGNATURES ON FOLLOWING PAGES]

                                      FF-2
<PAGE>

            IN WITNESS WHEREOF, each of Assignor and Assignee has caused these
presence to be executed by and through their respective undersigned officers
thereunto duly authorized as of the Effective Date.

Signed, sealed and delivered in the         ASSIGNOR:
presence of the following witnesses:

                                            ____________________________________
_____________________________
Signature of Witness

                                            By:_________________________________
_____________________________               Name:_______________________________
Type/Print Name of Witness                  Title:______________________________

_____________________________
Signature of Witness

_____________________________
Type/Print Name of Witness

STATE OF ___________  )
                      ) ss:
COUNTY OF _________   )

            The foregoing instrument was acknowledged before me this ___ day of
__________, 2006, by ______________________, as ______________________of
______________________, a ______________________, on behalf of said
______________________. He is personally known to me or has produced a driver's
license as identification.

                                            ____________________________________
                                            Name:_______________________________
                                            Notary Public - State of____________
                                            Commission No.______________________
                                            My commission Expires:______________

(NOTARY SEAL)

                                      FF-3
<PAGE>

Signed, sealed and delivered in the         ASSIGNEE:
presence of the following witnesses:

                                            ____________________________________
____________________________
Signature of Witness

                                            By:_________________________________
____________________________                Name:_______________________________
Type/Print Name of Witness                  Title:______________________________

____________________________
Signature of Witness

____________________________
Type/Print Name of Witness

STATE OF ___________    )
                        ) ss:
COUNTY OF _________     )

            The foregoing instrument was acknowledged before me this ___ day of
__________, 2006, by ______________________, as ______________________of
______________________, a ______________________, on behalf of said
______________________. He is personally known to me or has produced a driver's
license as identification.

                                            ____________________________________
                                            Name:_______________________________
                                            Notary Public - State of____________
                                            Commission No.______________________
                                            My commission Expires:______________

(NOTARY SEAL)

                                      FF-4

<PAGE>

                                    EXHIBIT A

                                      FF-5
<PAGE>

                        [ADD MORTGAGEE JOINDER IF NEEDED]

                                      FF-6<PAGE>

                                                                  EXHIBIT 10.104

================================================================================
CNL - Orlando

                               CNL GL RESORT, LP,

                                   as Borrower

                                       to

                      WACHOVIA BANK, NATIONAL ASSOCIATION,

                                    as Lender

                MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS
                               AND FIXTURE FILING

                           --------------------------

                           Dated: February 24, 2006

                           PREPARED BY AND UPON RECORDATION RETURN TO:

                           Proskauer Rose LLP
                           1585 Broadway
                           New York, New York 10036

                           Attention: David J. Weinberger, Esq.

================================================================================

FLORIDA DOCUMENTARY STAMP TAXES IN THE AMOUNT OF $1,172,500 AND FLORIDA
NON-RECURRING TANGIBLE TAXES IN THE AMOUNT OF $670,000 ARE BEING PAID UPON
RECORDATION OF THIS SECURITY INSTRUMENT.

<PAGE>

      THIS MORTGAGE, SECURITY AGREEMENT, ASSIGNMENT OF RENTS AND FIXTURE FILING
(the "Security Instrument") is made as of the 24th day of February, 2006, by CNL
GL RESORT, LP, a Delaware limited partnership, having its chief executive office
c/o CNL Hospitality Partners, LP, 450 South Orange Avenue, Orlando, Florida
32801 (hereinafter referred to as "Borrower"), to WACHOVIA BANK, NATIONAL
ASSOCIATION, having an address at Wachovia Bank, National Association,
Commercial Real Estate Services, 8739 Research Drive URP 4, NC 1075, Charlotte,
North Carolina 28262 (hereinafter referred to as "Lender").

                              W I T N E S S E T H:

      WHEREAS, Lender has authorized a loan (hereinafter referred to as the
"Loan") to the Borrower in the maximum principal sum of THREE HUNDRED
THIRTY-FIVE MILLION and NO/100 DOLLARS ($ 335,000,000.00) (hereinafter referred
to as the "Loan Amount"), which Loan is evidenced by that certain promissory
note, dated the date hereof (together with any supplements, amendments,
modifications or extensions thereof, hereinafter referred to as the "Note")
given by the Borrower, as maker, to Lender, as payee;

      WHEREAS, in consideration of the Loan, the Borrower has agreed to make
payments in amounts sufficient to pay and redeem, and provide for the payment
and redemption of the principal of, premium, if any, and interest on the Note
when due;

      WHEREAS, Borrower desires by this Security Instrument to provide for,
among other things, the issuance of the Note and for the deposit, deed and
pledge by Borrower with, and the creation of a security interest in favor of,
Lender, as security for the Borrower's obligations to Lender from time to time
pursuant to the Note and the other Loan Documents;

      WHEREAS, Borrower and Lender intend these recitals to be a material part
of this Security Instrument; and

      WHEREAS, all things necessary to make this Security Instrument the valid
and legally binding obligation of Borrower in accordance with its terms, for the
uses and purposes herein set forth, have been done and performed.

      NOW THEREFORE, to secure the payment of the principal of, prepayment
premium (if any) and interest on the Note and all other obligations, liabilities
or sums due or to become due under this Security Instrument, the Note or any
other Loan Document, including, without limitation, interest on said
obligations, liabilities or sums (said principal, premium, interest and other
sums being hereinafter referred to as the "Debt"), and the performance of all
other covenants, obligations and liabilities of the Borrower pursuant to the
Loan Documents, Borrower has executed and delivered this Security Instrument;
and Borrower has irrevocably granted, and by these presents and by the execution
and delivery hereof does hereby irrevocably grant, bargain, sell, alien, demise,
release, convey, assign, transfer, deed, hypothecate, pledge, set over, warrant,
mortgage and confirm to Lender, forever with power of sale, all right, title and
interest of Borrower in and to all of the following property, rights, interests
and estates:

<PAGE>

            (a) the plot(s), piece(s) or parcel(s) of real property described in
      EXHIBITS A-1, A-2 and A-3 attached hereto and made a part hereof
      (individually and collectively, hereinafter referred to as the
      "Premises");

            (b) (i) all buildings, foundations, structures, fixtures, additions,
      enlargements, extensions, modifications, repairs, replacements and
      improvements of every kind or nature now or hereafter located on the
      Premises (hereinafter collectively referred to as the "Improvements"); and
      (ii) to the extent permitted by law, the name or names, if any, as may now
      or hereafter be used for any of the Improvements, and the goodwill
      associated therewith;

            (c) all easements, servitudes, rights-of-way, strips and gores of
      land, streets, ways, alleys, passages, sewer rights, water, water courses,
      water rights and powers, ditches, ditch rights, reservoirs and reservoir
      rights, air rights and development rights, lateral support, drainage, gas,
      oil and mineral rights, tenements, hereditaments and appurtenances of any
      nature whatsoever, in any way belonging, relating or pertaining to the
      Premises or the Improvements and the reversion and reversions, remainder
      and remainders, whether existing or hereafter acquired, and all land lying
      in the bed of any street, road or avenue, opened or proposed, in front of
      or adjoining the Premises to the center line thereof and any and all
      sidewalks, drives, curbs, passageways, streets, spaces and alleys adjacent
      to or used in connection with the Premises and/or Improvements and all the
      estates, rights, titles, interests, property, possession, claim and demand
      whatsoever, both in law and in equity, of Borrower of, in and to the
      Premises and Improvements and every part and parcel thereof, with the
      appurtenances thereto;

            (d) all machinery, equipment, systems, fittings, apparatus,
      appliances, furniture, furnishings, tools, fixtures, Inventory (as
      hereinafter defined) and articles of personal property and accessions
      thereof and renewals, replacements thereof and substitutions therefor
      (including, but not limited to, all plumbing, lighting and elevator
      fixtures, office furniture, beds, bureaus, chiffonniers, chests, chairs,
      desks, lamps, mirrors, bookcases, tables, rugs, carpeting, drapes,
      draperies, curtains, shades, venetian blinds, wall coverings, screens,
      paintings, hangings, pictures, divans, couches, luggage carts, luggage
      racks, stools, sofas, chinaware, flatware, linens, pillows, blankets,
      glassware, foodcarts, cookware, dry cleaning facilities, dining room
      wagons, keys or other entry systems, bars, bar fixtures, liquor and other
      drink dispensers, icemakers, radios, television sets, intercom and paging
      equipment, electric and electronic equipment, dictating equipment,
      telephone systems, computerized accounting systems, engineering equipment,
      vehicles, medical equipment, potted plants, heating, lighting and plumbing
      fixtures, fire prevention and extinguishing apparatus, theft prevention
      equipment, cooling and air-conditioning systems, elevators, escalators,
      fittings, plants, apparatus, stoves, ranges, refrigerators, laundry
      machines, tools, machinery, engines, dynamos, motors, boilers,
      incinerators, switchboards, conduits, compressors, vacuum cleaning
      systems, floor cleaning, waxing and polishing equipment, call systems,
      brackets, signs, bulbs, bells, ash and fuel, conveyors, cabinets, lockers,
      shelving, spotlighting equipment, dishwashers, garbage disposals, washers
      and dryers), other customary hotel equipment

                                       2
<PAGE>

      and other property of every kind and nature whatsoever owned by Borrower,
      or in which Borrower has or shall have an interest, now or hereafter
      located upon, or in, and used in connection with the Premises or the
      Improvements, or appurtenant thereto, and all building equipment,
      materials and supplies of any nature whatsoever owned by Borrower, or in
      which Borrower has or shall have an interest, now or hereafter located
      upon, or in, and used in connection with the Premises or the Improvements
      or appurtenant thereto (hereinafter, all of the foregoing items described
      in this paragraph (d) are collectively called the "Equipment"), all of
      which, and any replacements, modifications, alterations and additions
      thereto, to the extent permitted by applicable law, shall be deemed to
      constitute fixtures (the "Fixtures"), and are part of the real estate and
      security for the payment of the Debt and the performance of Borrower's
      obligations. To the extent any portion of the Equipment is not real
      property or fixtures under applicable law, it shall be deemed to be
      personal property, and this Security Instrument shall constitute a
      security agreement creating a security interest therein in favor of Lender
      under the UCC;

            (e) subject to the provisions of Article VI hereof, all awards or
      payments, including interest thereon, which may hereafter be made with
      respect to the Premises, the Improvements, the Fixtures, or the Equipment,
      whether from the exercise of the right of eminent domain (including but
      not limited to any transfer made in lieu of or in anticipation of the
      exercise of said right), or for a change of grade, or for any other injury
      to or decrease in the value of the Premises, the Improvements or the
      Equipment or refunds with respect to the payment of property taxes and
      assessments, and all other proceeds of the conversion, voluntary or
      involuntary, of the Premises, Improvements, Equipment, Fixtures or any
      other Property or part thereof into cash or liquidated claims;

            (f) all leases, tenancies, franchises, licenses and permits,
      Property Agreements and other agreements affecting the use, enjoyment or
      occupancy of the Premises, the Improvements, the Fixtures, or the
      Equipment or any portion thereof now or hereafter entered into, whether
      before or after the filing by or against Borrower of any petition for
      relief under the Bankruptcy Code and all reciprocal easement agreements,
      license agreements and other agreements with Pad Owners, including,
      without limitation the Operating Lease (hereinafter collectively referred
      to as the "Leases"), together with all receivables, revenues, rentals,
      credit card receipts, receipts and all payments received which relate to
      the rental, lease, franchise and use of space at the Premises and rental
      and use of guest rooms or meeting rooms or banquet rooms or recreational
      facilities or bars, beverage or food sales, vending machines, mini-bars,
      room service, telephone, video and television systems, electronic mail,
      internet connections, guest laundry, bars, the provision or sale of other
      goods and services, and all other payments received from guests or
      visitors of the Premises, and other items of revenue, receipts or income
      as identified in the Uniform System of Accounts (as hereinafter defined),
      all cash or security deposits, lease termination payments, advance rentals
      and payments of similar nature and guarantees or other security held by,
      or issued in favor of, Borrower in connection therewith to the extent of
      Borrower's right or interest therein and all remainders, reversions and
      other rights and estates appurtenant thereto, and all base, fixed,
      percentage

                                       3
<PAGE>

      or additional rents, and other rents, oil and gas or other mineral
      royalties, and bonuses, issues, profits and rebates and refunds or other
      payments made by any Governmental Authority from or relating to the
      Premises, the Improvements, the Fixtures or the Equipment plus all rents,
      common area charges and other payments now existing or hereafter arising,
      whether paid or accruing before or after the filing by or against Borrower
      of any petition for relief under the Bankruptcy Code (the "Rents") and all
      proceeds from the sale or other disposition of the Leases and the right to
      receive and apply the Rents to the payment of the Debt;

            (g) subject to the provisions of Article III hereof, all proceeds of
      and any unearned premiums on any insurance policies covering the Premises,
      the Improvements, the Fixtures, the Rents or the Equipment, including,
      without limitation, the right to receive and apply the proceeds of any
      insurance, judgments, or settlements made in lieu thereof, for damage to
      the Premises, the Improvements, the Fixtures or the Equipment and all
      refunds or rebates of Impositions, and interest paid or payable with
      respect thereto;

            (h) all deposit accounts, securities accounts, funds or other
      accounts maintained or deposited with Lender, or its assigns, in
      connection herewith, including, without limitation, the Security Deposit
      Account (to the extent permitted by law), the Escrow Accounts, the Central
      Account, the Collection Account, and the Sub-Accounts and all monies and
      investments deposited or to be deposited in such accounts;

            (i) all accounts receivable, contract rights, franchises, interests,
      estate or other claims, both at law and in equity, now existing or
      hereafter arising, and relating to the Premises, the Improvements, the
      Fixtures or the Equipment, not included in Rents;

            (j) all now existing or hereafter arising claims against any Person
      with respect to any damage to the Premises, the Improvements, the Fixtures
      or the Equipment, including, without limitation, damage arising from any
      defect in or with respect to the design or construction of the
      Improvements, the Fixtures or the Equipment and any damage resulting
      therefrom;

            (k) all deposits or other security or advance payments, including
      rental payments now or hereafter made by or on behalf of Borrower to
      others, with respect to (i) insurance policies, (ii) utility services,
      (iii) cleaning, maintenance, repair or similar services, (iv) refuse
      removal or sewer service, (v) parking or similar services or rights and
      (vi) rental of Equipment, if any, relating to or otherwise used in the
      operation of the Premises, the Improvements, the Fixtures or the
      Equipment;

            (l) all intangible property now or hereafter relating to the
      Premises, the Improvements, the Fixtures or the Equipment or its
      operation, including, without limitation, software, letter of credit
      rights, trade names, trademarks (including, without limitation, any
      licenses of or agreements to license trade names or trademarks now or
      hereafter entered into by Borrower to the extent assignable), logos,
      building names and goodwill;

                                       4
<PAGE>

            (m) all now existing or hereafter arising advertising material,
      guaranties, warranties, building permits, other permits, licenses, plans
      and specifications, shop and working drawings, soil tests, appraisals and
      other documents, materials and/or personal property of any kind now or
      hereafter existing in or relating to the Premises, the Improvements, the
      Fixtures, and the Equipment;

            (n) all now existing or hereafter arising drawings, designs, plans
      and specifications prepared by architects, engineers, interior designers,
      landscape designers and any other consultants or professionals for the
      design, development, construction, repair and/or improvement of the
      Property, as amended from time to time;

            (o) subject to the provisions of Sections 2.06, 3.05, 4.04 and
      14.01(b) hereof, the right, in the name of and on behalf of Borrower, to
      appear in and defend any now existing or hereafter arising action or
      proceeding brought with respect to the Premises, the Improvements, the
      Fixtures or the Equipment and to commence any action or proceeding to
      protect the interest of Lender in the Premises, the Improvements, the
      Fixtures or the Equipment; and

            (p) all proceeds, products, substitutions and accessions (including
      claims and demands therefor) of each of the foregoing.

      All of the foregoing items (a) through (p), together with all of the
right, title and interest of Borrower therein, are collectively referred to as
the "Property".

      TO HAVE AND TO HOLD the above granted and described Property unto Lender,
and the successors and assigns of Lender in fee simple, forever.

      PROVIDED, ALWAYS, and these presents are upon this express condition, if
Borrower shall well and truly pay and discharge the Debt and perform and observe
the terms, covenants and conditions set forth in the Loan Documents, then these
presents and the estate hereby granted shall cease and be void.

      AND Borrower covenants with and warrants to Lender that:

                             ARTICLE I: DEFINITIONS

      Section 1.01. Certain Definitions.

      For all purposes of this Security Instrument, except as otherwise
expressly provided or unless the context clearly indicates a contrary intent:

            (i) the capitalized terms defined in this Section have the meanings
      assigned to them in this Section, and include the plural as well as the
      singular;

            (ii) all accounting terms not otherwise defined herein have the
      meanings assigned to them in accordance with GAAP; and

                                       5
<PAGE>

            (iii) the words "herein", "hereof", and "hereunder" and other words
      of similar import refer to this Security Instrument as a whole and not to
      any particular Section or other subdivision.

      "Additional Collateral" shall have the meaning set forth in Section 15.03
hereof.

      "Adjusted Net Cash Flow" shall mean, as of any date of calculation, the
Net Operating Income for all of the Cross-collateralized Properties over the
twelve (12)-month period preceding the date of calculation less the Recurring
Replacement Reserve Monthly Installment (assuming for purposes of this
definition that the definition of Recurring Replacement Reserve Monthly
Installment only includes the first sentence thereof and without duplication of
any items that are included in the calculation of Net Operating Income)
multiplied by twelve (12). The Adjusted Net Cash Flow shall be calculated by
Borrower and shall be subject to the reasonable review and approval of Lender.

      "Affiliate" of any specified Person shall mean any other Person directly
or indirectly Controlling or Controlled by or under direct or indirect common
Control with such specified Person.

      "Allocated Loan Amount" shall mean the Initial Allocated Loan Amount of
each Cross-collateralized Property as such amount may be adjusted from time to
time as hereinafter set forth. Upon each adjustment of the Principal Amount
(each a "Total Adjustment"), whether as a result of amortization, defeasance or
prepayment or as otherwise expressly provided herein or in any other Loan
Document, each Allocated Loan Amount shall be increased or decreased, as the
case may be, by an amount equal to the product of (a) the Total Adjustment, and
(b) a fraction, the numerator of which is the applicable Allocated Loan Amount
(prior to the adjustment in question) and the denominator of which is the
Principal Amount prior to the adjustment to the Principal Amount which results
in the recalculation of the Allocated Loan Amount. However, when the Principal
Amount is reduced as a result of Lender's receipt of (a) a Release Price or, in
connection with a Release, funds sufficient to prepay a portion of the Principal
Amount in the amount of the Release Price, the Allocated Loan Amount for the
Cross-collateralized Property being released and discharged from the encumbrance
of this Security Instrument and related Loan Documents shall be reduced to zero
(the amount by which such Allocated Loan Amount is reduced being referred to as
the "Released Allocated Amount"), and each other Allocated Loan Amount shall be
decreased by an amount equal to the product of (i) the excess of (A) the Release
Price over (B) the Released Allocated Amount and (ii) a fraction, the

                                       6
<PAGE>

numerator of which is the applicable Allocated Loan Amount (prior to the
adjustment in question) and the denominator of which is the aggregate of all of
the Allocated Loan Amounts other than the Allocated Loan Amount applicable to
the Cross-collateralized Property for which the Release Price was paid, or (b)
Net Proceeds, the Allocated Loan Amount for the Cross-collateralized Property
with respect to which the Net Proceeds were received shall be reduced to zero
(the amount by which such Allocated Loan Amount is reduced being referred to as
the "Foreclosed Allocated Amount") and each other Allocated Loan Amount shall
(A) if the Net Proceeds exceed the Foreclosed Allocated Amount (such excess
being referred to as the "Surplus Net Proceeds"), be decreased by an amount
equal to the product of (i) the Surplus Net Proceeds and (ii) a fraction, the
numerator of which is the applicable Allocated Loan Amount (prior to the
adjustment in question) and the denominator of which is the aggregate of all of
the Allocated Loan Amounts (prior to the adjustment in question) other than the
Allocated Loan Amount applicable to the Cross-collateralized Property with
respect to which the Net Proceeds were received (such fraction being referred to
as the "Net Proceeds Adjustment Fraction"), (B) if the Foreclosed Allocated
Amount exceeds the Net Proceeds (such excess being referred to as the "Net
Proceeds Deficiency"), be increased by an amount equal to the product of (i) the
Net Proceeds Deficiency and (ii) the Net Proceeds Adjustment Fraction, or (C) if
the Net Proceeds equal the Foreclosed Allocated Amount, remain unadjusted, or
(c) Loss Proceeds or partial prepayments or defeasances, as applicable, made in
accordance with Section 15.01 hereof, the Allocated Loan Amount for the
Cross-collateralized Property with respect to which the Loss Proceeds or partial
prepayments or defeasances, as applicable, were received shall be decreased by
an amount equal to the sum of (i) with respect to Loss Proceeds, Loss Proceeds
which are applied towards the reduction of the Principal Amount as set forth in
Article III hereof, if any, and (ii) with respect to partial prepayments or
defeasances, as applicable, the amount of any such partial prepayment which is
applied towards the reduction of the Principal Amount in accordance with the
provisions of the Note, if any, but in no event shall the Allocated Loan Amount
for the Cross-collateralized Property with respect to which the Loss Proceeds or
partial prepayments or defeasances, as applicable, were received be reduced to
an amount less than zero (the amount by which such Allocated Loan Amount is
reduced being referred to as the "Loss Proceeds or Prepayment Allocated Amount")
and each other Allocated Loan Amount shall be decreased by an amount equal to
the product of (i) the excess of (A) the Loss Proceeds or such partial
prepayments or defeasances, as applicable, over (B) the Loss Proceeds or
Prepayment Allocated Amount, and (ii) a fraction, the numerator of which is the
applicable Allocated Loan Amount (prior to the adjustment in question) and the
denominator of which is the aggregate of all of the Allocated Loan Amounts
(prior to the adjustment in question) other than the Allocated Loan Amount
applicable to the Cross-collateralized Property to which such Loss Proceeds or
partial prepayments or defeasances, as applicable, were applied.

      "Annual Budget" shall mean an annual budget submitted by Borrower to
Lender in accordance with the terms of Section 2.09 hereof.

      "Approved Annual Budget" shall mean each Annual Budget approved by Lender
in accordance with the terms hereof, or if not required to be approved by Lender
pursuant to the terms hereof, each Annual Budget submitted to Lender pursuant to
Section 2.09 hereof.

      "Approved Letter of Credit" shall mean an irrevocable, unconditional,
transferable, clean sight draft letter of credit in favor of Lender and its
successors and/or assigns, the obligation to reimburse draws made in connection
with which are those of a Person other than Borrower, with a term of not less
than one (1) year and which is drawable in whole or in part by sight draft in
New York City, issued by a bank having a long-term unsecured debt rating of not
less than "AA" (or its equivalent) and a short-term unsecured debt rating of not
less than "A-1" (or its equivalent) by each Rating Agency and otherwise
reasonably acceptable to Lender.

                                       7
<PAGE>

      "Approved Manager" shall mean (a) the Manager as of the Closing Date, (b)
the property managers listed on SCHEDULE 1 attached hereto and made a part
hereof provided that each such property manager continues to be Controlled by
substantially the same persons Controlling such property manager as of the
Closing Date (or if such manager is a publicly traded company, such manager
continues to be traded on a national stock exchange or quoted on the NASDAQ
Stock Market); (c) any Close Affiliate of any of the foregoing Persons; or (d)
any other reputable and experienced professional hotel management company (i)
whose competence, qualifications, general reputation and experience in managing
properties of a quality equal to or exceeding the quality of the Property are
comparable to, or greater than that of the Person which was the Manager as of
the Closing Date, or a Close Affiliate thereof, in each case which has been
approved by Lender in its reasonable discretion and the holder of each Mez Loan
and (ii) with respect to which Lender has received written confirmation from
each Rating Agency that any rating issued by the Rating Agency in connection
with a Securitization will not, as a result of the proposed change of Manager,
be downgraded from the then current ratings thereof, qualified or withdrawn.

      "Approved Replacement Management Agreement" shall have the meaning set
forth in Section 5.01 hereof.

      "Architect" shall have the meaning set forth in Section 3.04(b)(i) hereof.

      "Assignment" shall mean the Assignment of Leases and Rents and Security
Deposits of even date herewith relating to the Property given by Borrower to
Lender, as the same may be modified, amended or supplemented from time to time.

      "Bank" shall mean the bank, trust company, savings and loan association or
savings bank designated by Lender, in its sole and absolute discretion, in which
the Central Account shall be located.

      "Bankruptcy Code" shall mean 11 U.S.C. Section 101 et seq., as amended
from time to time.

      "Basic Carrying Costs" shall mean the sum of the following costs
associated with the Property: (a) Real Estate Taxes and (b) insurance premiums.

      "Basic Carrying Costs Escrow Account" shall mean the Escrow Account
maintained pursuant to Section 5.06 hereof.

      "Basic Carrying Costs Monthly Installment" shall mean Lender's estimate of
one-twelfth (1/12th) of the annual amount for Basic Carrying Costs. "Basic
Carrying Costs Monthly Installment" shall also include, if required by Lender, a
sum of money which, together with such monthly installments, will be sufficient
to make the payment of each such Basic Carrying Cost at least twenty (20) days
prior to the date initially due. Should such Basic Carrying Costs not be
ascertainable at the time any monthly deposit is required to be made, the Basic
Carrying Costs Monthly Installment shall be determined by Lender in its
reasonable discretion on the basis of the aggregate Basic Carrying Costs for the
prior Fiscal Year or month or the prior payment period for such cost. As soon as
the Basic Carrying Costs are fixed for the then current Fiscal

                                       8
<PAGE>

Year, month or period, the next ensuing Basic Carrying Costs Monthly Installment
shall be adjusted to reflect any deficiency or surplus in prior monthly
payments. If at any time during the term of the Loan there will be insufficient
funds in the Basic Carrying Costs Escrow Account to make payments when they
become due and payable, Lender shall have the right to adjust the Basic Carrying
Costs Monthly Installment such that there will be sufficient funds to make such
payments. Notwithstanding the foregoing, provided that no Event of Default
exists, if Borrower is depositing a sum with Manager on a monthly basis pursuant
to the Management Agreement to be used for the payment of Basic Carrying Costs,
such sums are controlled by Manager and Borrower shall have delivered, or cause
to be delivered to Lender proof that the Basic Carrying Costs with respect to
which Manager is receiving deposits are paid not less than five (5) Business
Days prior to the date upon which they are due and payable, the Basic Carrying
Costs Monthly Installment shall be reduced by the amount of Basic Carrying Costs
which are deposited with Manager.

      "Basic Carrying Costs Sub-Account" shall mean the Sub-Account of the
Central Account established pursuant to Section 5.02 into which the Basic
Carrying Costs Monthly Installments shall be deposited.

      "Borrower" shall mean Borrower named herein and any successor to the
obligations of Borrower.

      "Business Day" shall mean any day other than (a) a Saturday or Sunday, or
(b) a day on which banking and savings and loan institutions in the State of New
York or the State of North Carolina are authorized or obligated by law or
executive order to be closed, or at any time during which the Loan is an asset
of a Securitization, the cities, states and/or commonwealths used in the
comparable definition of "Business Day" in the Securitization documents.

      "Capital Expenditures" shall mean for any period, the amount expended for
items capitalized under GAAP including expenditures for building improvements or
major repairs, leasing commissions and tenant improvements.

      "Cash Expenses" shall mean for any period, the operating expenses
(excluding Capital Expenditures) for the Property as set forth in an Approved
Annual Budget to the extent that such expenses are actually incurred by Borrower
minus payments into the Basic Carrying Costs Sub-Account, the Debt Service
Payment Sub-Account and the Recurring Replacement Reserve Sub-Account.

      "Central Account" shall mean an Eligible Account, maintained at the Bank,
in the name of Lender or its successors or assigns (as secured party) as may be
designated by Lender.

      "Close Affiliate" shall mean with respect to any Person (the "First
Person") any other Person (each, a "Second Person") which is an Affiliate of the
First Person and in respect of which any of the following are true: (a) the
Second Person owns, directly or indirectly, at least 85% of

                                       9
<PAGE>

all of the legal, beneficial and/or equitable interest in such First Person, (b)
the First Person owns, directly or indirectly, at least 85% of all of the legal,
beneficial and/or equitable interest in such Second Person, or (c) a third
Person owns, directly or indirectly, at least 85% of all of the legal,
beneficial and/or equitable interest in both the First Person and the Second
Person.

      "Closing Date" shall mean the date of the Note.

      "Code" shall mean the Internal Revenue Code of 1986, as amended and as it
may be further amended from time to time, any successor statutes thereto, and
applicable U.S. Department of Treasury regulations issued pursuant thereto.

      "Collection Account" shall mean an Eligible Account maintained in a bank
acceptable to Lender in the joint names of Borrower and Lender or such other
name as Lender may designate in writing.

      "Condemnation Proceeds" shall mean all of the proceeds in respect of any
Taking or purchase in lieu thereof.

      "Contractual Obligation" shall mean, as to any Person, any provision of
any security issued by such Person or of any agreement, instrument or
undertaking to which such Person is a party or by which it or any of the
property owned by it is bound.

      "Control" means, when used with respect to any specific Person, the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person whether through
ownership of voting securities, beneficial interests, by contract or otherwise.
The definition is to be construed to apply equally to variations of the word
"Control" including "Controlled," "Controlling" or "Controlled by."

      "Credit Card Company" shall have the meaning set forth in Section 5.01
hereof.

      "Credit Card Payment Direction Letter" shall have the meaning set forth in
Section 5.01 hereof.

      "Cross-collateralized Property" shall mean each parcel or parcels of real
property encumbered by this Security Instrument as identified on Exhibit E
attached hereto and made a part hereof.

      "Curtailment Reserve Escrow Account" shall mean the Escrow Account
maintained pursuant to Section 5.11 hereof into which sums shall be deposited
during an O&M Operative Period.

      "Curtailment Reserve Sub-Account" shall mean the Sub-Account of the
Central Account established pursuant to Section 5.02 hereof into which excess
cash flow shall be deposited pursuant to Section 5.05.

      "Debt" shall have the meaning set forth in the Recitals hereto.

      "Debt Service" shall mean the amount of interest and principal payments
due and payable in accordance with the Note during an applicable period.

                                       10
<PAGE>

      "Debt Service Coverage" shall mean the quotient obtained by dividing
Adjusted Net Cash Flow by the sum of the (a) aggregate payments of interest,
principal and all other sums due for such specified period under the Note
(determined as of the date the calculation of Debt Service Coverage is required
or requested hereunder) and (b) aggregate payments of interest, principal and
all other sums due for such specified period pursuant to the terms of
subordinate or mezzanine financing, if any, then affecting or related to the
Property or, if Debt Service Coverage is being calculated in connection with a
request for consent to any subordinate or mezzanine financing, then proposed.

      "Debt Service Payment Sub-Account" shall mean the Sub-Account of the
Central Account established pursuant to Section 5.02 hereof into which the
Required Debt Service Payment shall be deposited.

      "Debt Yield" shall mean Adjusted Net Cash Flow divided by the sum of (a)
the unpaid Principal Amount and (b) the outstanding principal balance of any
subordinate or mezzanine financing including, without limitation, the Mez Loan
then affecting or related to the Property or any interest therein (determined as
of the date of the calculation of Debt Yield). An example of how Debt Yield will
be calculated is attached hereto as Schedule 2 and made a part hereof, which
example is for illustration purposes only.

      "Default" shall mean any Event of Default or event which would constitute
an Event of Default if all requirements in connection therewith for the giving
of notice, the lapse of time, and the happening of any further condition, event
or act, had been satisfied.

      "Default Management Period" shall mean any period of time during the term
hereof when the Cross-collateralized Property is not being managed by an
Approved Manager under the Management Agreement which exists as of the Closing
Date or under an Approved Replacement Management Agreement.

      "Default Rate" shall mean the lesser of (a) the highest rate allowable at
law and (b) four percent (4%) above the interest rate set forth in the Note.

      "Default Rate Interest" shall mean, to the extent the Default Rate becomes
applicable, interest in excess of the interest which would have accrued on (a)
the Principal Amount and (b) any accrued but unpaid interest, if the Default
Rate was not applicable.

      "Defeasance Deposit" shall mean an amount equal to the total cost incurred
or to be incurred in the purchase by or on behalf of Borrower of Federal
Obligations necessary to meet the Scheduled Defeasance Payments.

      "Defeased Note" shall have the meaning set forth in Section 15.01 hereof.

      "Development Laws" shall mean all applicable subdivision, zoning,
environmental protection, wetlands protection, or land use laws or ordinances,
and any and all applicable rules and regulations of any Governmental Authority
promulgated thereunder or related thereto.

                                       11
<PAGE>

      "Disclosure Document" shall mean a prospectus, prospectus supplement,
private placement memorandum, or similar offering memorandum or offering
circular, in each case in preliminary or final form, used to offer securities in
connection with a Securitization.

      "Dollar" and the sign "$" shall mean lawful money of the United States of
America.

      "Eligible Account" shall mean a segregated account which is either (a) an
account or accounts maintained with a federal or state chartered depository
institution or trust company the long term unsecured debt obligations of which
are rated by each of the Rating Agencies (or, if not rated by Fitch, Inc.
("Fitch"), an institution acceptable to Fitch, as confirmed in writing that such
account would not, in and of itself, result in a downgrade, qualification or
withdrawal of the then current ratings assigned to any certificates issued in
connection with a Securitization) in its highest rating category at all times
(or, in the case of the Basic Carrying Costs Escrow Account, the long term
unsecured debt obligations of which are rated at least "AA" (or its equivalent))
by each of the Rating Agencies (or, if not rated by Fitch, an institution
acceptable to Fitch, as confirmed in writing that such account would not, in and
of itself, result in a downgrade, qualification or withdrawal of the then
current ratings assigned to any certificates issued in connection with a
Securitization) or, if the funds in such account are to be held in such account
for less than thirty (30) days, the short term obligations of which are rated by
each of the Rating Agencies (or, if not rated by Fitch, an institution
acceptable to Fitch, as confirmed in writing that such account would not, in and
of itself, result in a downgrade, qualification or withdrawal of the then
current ratings assigned to any certificates issued in connection with a
Securitization) in its highest rating category at all times or (b) a segregated
trust account or accounts maintained with a federal or state chartered
depository institution or trust company acting in its fiduciary capacity which,
in the case of a state chartered depository institution is subject to
regulations substantially similar to 12 C.F.R. Section 9.10(b), having in either
case a combined capital and surplus of at least $100,000,000 and subject to
supervision or examination by federal and state authority, or otherwise
acceptable (as evidenced by a written confirmation from each Rating Agency that
such account would not, in and of itself, cause a downgrade, qualification or
withdrawal of the then current ratings assigned to any certificates issued in
connection with a Securitization) to each Rating Agency, which may be an account
maintained by Lender or its agents. Eligible Accounts may bear interest. The
title of each Eligible Account shall indicate that the funds held therein are
held in trust for the uses and purposes set forth herein.

      "Engineer" shall have the meaning set forth in Section 3.04(b)(i) hereof.

      "Engineering Escrow Account" shall mean an Escrow Account established and
maintained pursuant to Section 5.12 hereof relating to payments for any Required
Engineering Work.

      "Environmental Problem" shall mean any of the following:

            (a) the presence of any Hazardous Material on, in, under, or above
      all or any portion of the Property other than heating oil, cleaning
      fluids, pesticides and other substances customarily used in the operation
      of properties that are being used for the same purposes as the Property is
      presently being used, provided such use and/or storage

                                       12
<PAGE>

      for use is in compliance with the requirements hereof and the other Loan
      Documents and does not give rise to liability under applicable Legal
      Requirements or Environmental Statutes or be the basis for a lien against
      the Property or any part thereof;

            (b) the release of any Hazardous Material from or onto the Property;

            (c) the violation of any Environmental Statute with respect to the
      Property; or

            (d) the failure to obtain or to abide by the terms or conditions of
      any permit or approval required under any Environmental Statute with
      respect to the Property.

A condition described above shall be an Environmental Problem regardless of
whether or not any Governmental Authority has taken any action in connection
with the condition and regardless of whether that condition was in existence on
or before the date hereof.

      "Environmental Report" shall mean the environmental audit report for the
Property and any supplements or updates thereto, previously delivered to Lender
in connection with the Loan.

      "Environmental Statute" shall mean any federal, state or local statute,
ordinance, rule or regulation, any judicial or administrative order (whether or
not on consent) or judgment applicable to Borrower or the Property including,
without limitation, any judgment or settlement based on common law theories, and
any provisions or condition of any permit, license or other authorization
binding on Borrower relating to (a) the protection of the environment, the
safety and health of persons (including employees) or the public welfare from
actual or potential exposure (or effects of exposure) to any actual or potential
release, discharge, disposal or emission (whether past or present) of any
Hazardous Materials or (b) the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of any Hazardous Materials,
including, but not limited to, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 ("CERCLA"), as amended by the Superfund
Amendments and Reauthorization Act of 1986, 42 U.S.C. Section 9601 et seq., the
Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery
Act of 1976, as amended by the Solid and Hazardous Waste Amendments of 1984, 42
U.S.C. Section 6901 et seq., the Federal Water Pollution Control Act, as amended
by the Clean Water Act of 1977, 33 U.S.C. Section 1251 et seq., the Toxic
Substances Control Act of 1976, 15 U.S.C. Section 2601 et seq., the Emergency
Planning and Community Right-to-Know Act of 1986, 42 U.S.C. Section 1101 et
seq., the Clean Air Act of 1966, as amended, 42 U.S.C. Section 7401 et seq., the
National Environmental Policy Act of 1975, 42 U.S.C. Section 4321, the Rivers
and Harbors Act of 1899, 33 U.S.C. Section 401 et seq., the Endangered Species
Act of 1973, as amended, 16 U.S.C. Section 1531 et seq., the Occupational Safety
and Health Act of 1970, as amended, 29 U.S.C. Section 651 et seq., and the Safe
Drinking Water Act of 1974, as amended, 42 U.S.C. Section 300(f) et seq., and
all rules, regulations and guidance documents promulgated or published
thereunder.

      "Equipment" shall have the meaning set forth in granting clause (d) of
this Security Instrument.

                                       13
<PAGE>

      "ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated thereunder. Section
references to ERISA are to ERISA, as in effect at the date of this Security
Instrument and, as of the relevant date, any subsequent provisions of ERISA,
amendatory thereof, supplemental thereto or substituted therefor.

      "ERISA Affiliate" shall mean any corporation or trade or business that is
a member of any group of organizations (a) described in Section 414(b) or (c) of
the Code of which Borrower or Guarantor is a member and (b) solely for purposes
of potential liability under Section 302(c)(11) of ERISA and Section 412(c)(11)
of the Code and the lien created under Section 302(f) of ERISA and Section
412(n) of the Code, described in Section 414(m) or (o) of the Code of which
Borrower or Guarantor is a member.

      "Escrow Account" shall mean each of the Engineering Escrow Account, the
Basic Carrying Costs Escrow Account, the Recurring Replacement Reserve Escrow
Account, the Operation and Maintenance Expense Escrow Account, the Mez Payment
Escrow Account and the Curtailment Reserve Escrow Account, each of which shall
be an Eligible Account or book entry sub-account of an Eligible Account.

      "Event of Default" shall have the meaning set forth in Section 13.01
hereof.

      "Extraordinary Expense" shall mean an extraordinary operating expense or
capital expense not set forth in the Approved Annual Budget or allotted for in
the Recurring Replacement Reserve Sub-Account.

      "Federal Obligations" shall mean non-callable direct obligations of, or
obligations fully guaranteed as to payment of principal and interest by, the
United States of America or any agency or instrumentality thereof provided that
such obligations are backed by the full faith and credit of the United States of
America as chosen by Borrower, subject to the reasonable approval of Lender.

      "Fiscal Year" shall mean the twelve (12) month period commencing on
January 1 and ending on December 31 during each year of the term of this
Security Instrument, or such other fiscal year of Borrower as Borrower may
select from time to time with the prior written consent of Lender.

      "Fixtures" shall have the meaning set forth in granting clause (d) of this
Security Instrument.

      "Franchise Agreement" shall mean any franchise agreement relating to the
operation of the Premises allowing the use of a national hotel brand, provided
that Lender acknowledges, as of the Closing Date, that no Franchise Agreement
exists.

      "GAAP" shall mean generally accepted accounting principles in the United
States of America, as of the date of the applicable financial report,
consistently applied.

                                       14
<PAGE>

      "General Partner" shall mean, if Borrower or Operating Tenant is a
partnership, each general partner of Borrower or Operating Tenant, as
applicable, and, if Borrower or Operating Tenant is a limited liability company,
each managing member of Borrower or Operating Tenant, as applicable, and in each
case, if applicable, each general partner or managing member of such general
partner or managing member. In the event that Borrower or Operating Tenant or
any General Partner is a single member limited liability company, the term
"General Partner" shall include such single member.

      "Golf Premises" shall mean that portion of the Premises described in
EXHIBIT A-3 attached hereto and made a part hereof.

      "Governmental Authority" shall mean, with respect to any Person, any
federal or State government or other political subdivision thereof and any
entity, including any regulatory or administrative authority or court,
exercising executive, legislative, judicial, regulatory or administrative or
quasi-administrative functions of or pertaining to government, and any
arbitration board or tribunal, in each case having jurisdiction over such
applicable Person or such Person's property and any stock exchange on which
shares of capital stock of such Person are listed or admitted for trading.

      "Guarantor" shall mean any Person guaranteeing, in whole or in part, the
obligations of Borrower under the Loan Documents.

      "Hazardous Material" shall mean any flammable, explosive or radioactive
materials, hazardous materials or wastes, hazardous or toxic substances,
pollutants or related materials, asbestos or any material containing asbestos,
molds, spores and fungus which may pose a risk to human health or the
environment or any other substance or material as defined in or regulated by any
Environmental Statutes.

      "Impositions" shall mean all taxes (including, without limitation, all
real estate, ad valorem, sales (including those imposed on lease rentals), use,
single business, gross receipts, value added, intangible, transaction, privilege
or license or similar taxes), assessments (including, without limitation, all
assessments for public improvements or benefits, whether or not commenced or
completed prior to the date hereof and whether or not commenced or completed
within the term of this Security Instrument), ground rents, water, sewer or
other rents and charges, excises, levies, fees (including, without limitation,
license, permit, inspection, authorization and similar fees), and all other
governmental charges, in each case whether general or special, ordinary or
extraordinary, or foreseen or unforeseen, of every character in respect of the
Property and/or any Rent (including all interest and penalties thereon), which
at any time prior to, during or in respect of the term hereof may be assessed or
imposed on or in respect of or be a lien upon (a) Borrower (including, without
limitation, all franchise, single business or other taxes imposed on Borrower
for the privilege of doing business in the jurisdiction in which the Property or
any other collateral delivered or pledged to Lender in connection with the Loan
is located) or Lender, (b) the Property or any part thereof or any Rents
therefrom or any estate, right, title or interest therein, or (c) any occupancy,
operation, use or possession of, or sales from, or activity conducted on, or in
connection with the Property, or any part thereof, or the leasing or use of the
Property, or any part thereof, or the acquisition or financing of the
acquisition of the

                                       15
<PAGE>

Property, or any part thereof, by Borrower. Nothing contained in this Security
Instrument shall be construed to require Borrower to pay any tax, assessment,
levy or charge imposed on (i) any tenant occupying any portion of the Property,
(ii) any manager of the Property, including any Manager, or (iii) Lender or any
other third party in the nature of a capital levy, estate, inheritance,
succession, income or net revenue tax.

      "Improvements" shall have the meaning set forth in granting clause (b) of
this Security Instrument.

      "Indemnified Parties" shall have the meaning set forth in Section 12.01
hereof.

      "Independent" shall mean, when used with respect to any Person, a Person
who (a) is in fact independent, (b) does not have any direct financial interest
or any material indirect financial interest in Borrower, or in any Affiliate of
Borrower or any constituent partner, shareholder, member or beneficiary of
Borrower, (c) is not connected with Borrower or any Affiliate of Borrower or any
constituent partner, shareholder, member or beneficiary of Borrower as an
officer, employee, promoter, underwriter, trustee, partner, director or person
performing similar functions and (d) is not a member of the immediate family of
a Person defined in (b) or (c) above. Whenever it is herein provided that any
Independent Person's opinion or certificate shall be provided, such opinion or
certificate shall state that the Person executing the same has read this
definition and is Independent within the meaning hereof.

      "Initial Allocated Loan Amount" shall mean the portion of the Loan Amount
allocated to each Cross-collateralized Property as set forth on EXHIBIT E
annexed hereto and made a part hereof.

      "Initial Engineering Deposit" shall equal the amount set forth on EXHIBIT
B attached hereto and made a part hereof.

      "Institutional Lender" shall mean any of the following Persons: (a) any
bank, savings and loan association, savings institution, trust company or
national banking association, acting for its own account or in a fiduciary
capacity, (b) any charitable foundation, (c) any insurance company or pension
and/or annuity company, (d) any fraternal benefit society, (e) any pension,
retirement or profit sharing trust or fund within the meaning of Title I of
ERISA or for which any bank, trust company, national banking association or
investment adviser registered under the Investment Advisers Act of 1940, as
amended, is acting as trustee or agent, (f) any investment company or business
development company, as defined in the Investment Company Act of 1940, as
amended, (g) any small business investment company licensed under the Small
Business Investment Act of 1958, as amended, (h) any broker or dealer registered
under the Securities Exchange Act of 1934, as amended, or any investment adviser
registered under the Investment Adviser Act of 1940, as amended, (i) any
government, any public employees' pension or retirement system, or any other
government agency supervising the investment of public funds, or (j) any other
entity all of the equity owners of which are Institutional Lenders; provided
that each of said Persons shall have net assets in excess of $1,000,000,000 and
a net worth in excess of $500,000,000, be in the business of making commercial
mortgage loans, secured by properties

                                       16
<PAGE>

of like type, size and value as the Property and have a long term credit rating
which is not less than "BBB-" (or its equivalent) from each Rating Agency.

      "Insurance Proceeds" shall mean all of the proceeds received under the
insurance policies required to be maintained by Borrower pursuant to Article III
hereof.

      "Insurance Requirements" shall mean all terms of any insurance policy
required by this Security Instrument, all requirements of the issuer of any such
policy, and all regulations and then current standards applicable to or
affecting the Property or any use or condition thereof, which may, at any time,
be recommended by the Board of Fire Underwriters, if any, having jurisdiction
over the Property, or such other Person exercising similar functions.

      "Interest Accrual Period" shall mean the period commencing on the Closing
Date and ending on the day prior to the first Payment Date occurring after the
Closing Date and, thereafter, each calendar month.

      "Interest Rate" shall have the meaning set forth in the Note.

      "Interest Shortfall" shall mean any shortfall in the amount of interest
required to be paid with respect to the Loan Amount on any Payment Date.

      "Inventory" shall have the meaning as such term is defined in the Uniform
Commercial Code applicable in the State in which the Property is located,
including, without limitation, provisions in storerooms, refrigerators, pantries
and kitchens, beverages in wine cellars and bars, other merchandise for sale,
fuel, mechanical supplies, stationery and other expenses, supplies and similar
items, as defined in the Uniform System of Accounts.

      "JW Premises" shall mean that portion of the Premises described in EXHIBIT
A-1 attached hereto and made a part hereof.

      "Late Charge" shall have the meaning set forth in Section 13.09 hereof.

      "Leases" shall have the meaning set forth in granting clause (f) of this
Security Instrument.

      "Legal Requirement" shall mean as to any Person, the certificate of
incorporation, by-laws, certificate of limited partnership, agreement of limited
partnership or other organization or governing documents of such Person, and any
law, statute, order, ordinance, judgment, decree, injunction, treaty, rule or
regulation (including, without limitation, Environmental Statutes, Development
Laws and Use Requirements) or determination of an arbitrator or a court or other
Governmental Authority and all covenants, agreements, restrictions and
encumbrances contained in any instruments, in each case applicable to or binding
upon such Person or any of its property or to which such Person or any of its
property is subject.

      "Lender" shall mean the Lender named herein and its successors or assigns.

      "Loan" shall have the meaning set forth in the Recitals hereto.

                                       17
<PAGE>

      "Loan Amount" shall have the meaning set forth in the Recitals hereto.

      "Loan Documents" shall mean this Security Instrument, the Note, the
Assignment, and any and all other agreements, instruments, certificates or
documents executed and delivered by Borrower or any Affiliate of Borrower in
connection with the Loan, together with any supplements, amendments,
modifications or extensions thereof.

      "Loan Year" shall mean each 365 day period (or 366 day period if the month
of February in a leap year is included) commencing on the first day of the month
following the Closing Date (provided, however, that the first Loan Year shall
also include the period from the Closing Date to the end of the month in which
the Closing Date occurs).

      "Lockout Expiration Date" shall have the meaning set forth in Section
15.01(c) hereof.

      "Loss Proceeds" shall mean, collectively, all Insurance Proceeds and all
Condemnation Proceeds.

      "Major Space Lease" shall mean any Space Lease of a tenant or Affiliate of
such tenant where such tenant, together with such Affiliate, leases, in the
aggregate, 10,000 square feet or more.

      "Management Agreement" shall have the meaning set forth in Section 7.02
hereof.

      "Manager" shall mean Marriott International, Inc. ("Marriott"), the
manager as of the Closing Date, and any Person, other than Borrower or any
Affiliate of Borrower, which manages the Property on behalf of Borrower and
which is an Approved Manager.

      "Manager Certification" shall have the meaning set forth in Section 2.09
hereof.

      "Material Adverse Effect" shall mean any event or condition that has a
material adverse effect on (a) the Property taken as a whole, (b) the business,
prospects, profits, management, operations or condition (financial or otherwise)
of Borrower, (c) the enforceability, validity, perfection or priority of the
lien of any Loan Document or (d) the ability of Borrower to satisfy any
obligations under any Loan Document.

      "Maturity", when used with respect to the Note, shall mean the Maturity
Date set forth in the Note or such other date pursuant to the Note on which the
final payment of principal, and premium, if any, on the Note becomes due and
payable as therein or herein provided, whether at Stated Maturity or by
declaration of acceleration, or otherwise.

      "Maturity Date" shall mean the Maturity Date set forth in the Note.

      "Membership Deposit Account" shall mean an Eligible Account maintained by
Manager the location and account number of which have been delivered in writing
to Lender.

      "Mez Loan" shall mean certain mezzanine loans to owners of the direct or
indirect equity interest in Borrower which are evidenced by certain promissory
notes of even date herewith in

                                       18
<PAGE>

the aggregate original principal amount of $235,000,000 which are secured by a
first priority pledge of the direct or indirect ownership interest of such
Persons in Borrower.

      "Mez Payment Amount" shall mean, as of any Payment Date, the amount of
interest then due and payable pursuant to the terms of the Mez Loan.

      "Mez Payment Escrow Account" shall mean the Escrow Account maintained
pursuant to Section 5.14 hereof.

      "Mez Payment Sub-Account" shall mean the Sub-Account of the Central
Account established pursuant to Section 5.02 hereof into which the Mez Payment
Amount shall be deposited.

      "Monthly Debt Service Payment" shall mean a monthly payment of principal
and interest in an amount equal to that which is required pursuant to the Note.

      "Multiemployer Plan" shall mean a multiemployer plan defined as such in
Section 3(37) of ERISA to which contributions have been, or were required to
have been, made by Borrower, Guarantor or any ERISA Affiliate and which is
covered by Title IV of ERISA.

      "Net Capital Expenditures" shall mean for any period the amount by which
Capital Expenditures during such period exceeds reimbursements for such items
during such period from any fund established pursuant to the Loan Documents.

      "Net Membership Cash Flow" shall mean the net cash flow (whether positive
or negative) consisting of (a) cash received from sales of new club memberships
and conversions of existing club memberships to new club memberships (including
deposits and ongoing dues relating thereto), plus (b) cash principal payments
received on membership notes evidencing the financing of the purchase of new
club memberships or the conversion of existing club memberships, less (c) cash
paid to cancel or recall existing club memberships and refunds of new club
membership sales to the extent not otherwise accounted for in Operating Income
or Operating Expenses in accordance with GAAP (however, in the case of (a), (b)
or (c) above, exclusive of refunds funded out of the Membership Deposit
Account).

      "Net Operating Income" shall mean in each Fiscal Year or portion thereof
during the term hereof, Operating Income less Operating Expenses.

      "Net Proceeds" shall mean the excess of (a)(i) the purchase price (at
foreclosure or otherwise) actually received by Lender with respect to the
Property as a result of the exercise by Lender of its rights, powers, privileges
and other remedies after the occurrence of an Event of Default, or (ii) in the
event that Lender (or Lender's nominee) is the purchaser at foreclosure by
credit bid, then the amount of such credit bid, in either case, over (b) all
costs and expenses, including, without limitation, all attorneys' fees and
disbursements and any brokerage fees, if applicable, incurred by Lender in
connection with the exercise of such remedies, including the sale of such
Property after a foreclosure against the Property.

                                       19
<PAGE>

      "Note" shall have the meaning set forth in the Recitals hereto.

      "O&M Operative Period" shall mean the period of time (a) commencing upon
the determination by Lender that the Debt Yield (tested quarterly except during
the continuance of an O&M Operative Period, in which event the Debt Yield shall
be tested monthly and shall be calculated based upon information contained in
the reports furnished to Lender pursuant to Section 2.09 hereof) is less than or
equal to 7.65% with respect to the first (1st) Loan Year or 8.25% thereafter and
(b) terminating on the Payment Date next succeeding the date upon which Lender
determines that the Debt Yield for four (4) consecutive months is equal to or
greater than 7.65% in the first (1st) Loan Year or 8.25% thereafter.

      "OFAC List" means the list of specially designated nationals and blocked
persons subject to financial sanctions that is maintained by the U.S. Treasury
Department, Office of Foreign Assets Control and accessible through the internet
website www.treas.gov/ofac/t11sdn.pdf.

      "Officer's Certificate" shall mean a certificate delivered to Lender by
Borrower which is signed on behalf of Borrower by an authorized representative
of Borrower which states that the items set forth in such certificate are true,
accurate and complete in all respects.

      "Operating Expenses" shall mean, in each Fiscal Year or portion thereof
during the term hereof, without duplication, all expenses directly attributable
to the operation, repair and/or maintenance of the Property including, without
limitation, (a) Impositions, (b) insurance premiums, (c) management fees,
whether or not actually paid, equal to the greater of the actual management fees
(exclusive of incentive management fees) and four percent (4%) of annual
Operating Income and (d) costs attributable to the ownership or operation of the
Property, including costs (including labor) of providing services including
rooms, food and beverage, telecommunications, garage and parking and other
operating departments, as well as Impositions, including real estate and other
business taxes, rental expenses, insurance premiums, utilities costs,
administrative and general costs, repairs and maintenance costs, third-party
franchise fees, management fees actually paid under the Management Agreement,
other costs and expenses relating to the Property and legal expenses incurred in
connection with the operation of the Property, determined, in each case on an
accrual basis. "Operating Expenses" shall not include (i) depreciation or
amortization or other non cash items, (ii) the principal of and interest on the
Note, (iii) income taxes or other taxes in the nature of income taxes, (iv) any
expenses (including legal, accounting and other professional fees, expenses and
disbursements) incurred in connection with and allocable solely to the issuance
of the Note, (v) distributions to Borrower or (vi) costs incurred in connection
with the sale and marketing of club memberships (to the extend otherwise
included in the calculation of Net Membership Cash Flow).

      "Operating Income" shall mean, in each Fiscal Year or portion thereof
during the term hereof, all revenue derived by Borrower or Operating Tenant (or
by Manager for the Account of Borrower or Operating Affiliate) arising from the
Property including, without limitation, room revenues, vending machines
revenues, beverage revenues, food revenues, and packaging revenues, rental
revenues (whether denominated as basic rent, additional rent, escalation
payments, electrical payments or otherwise) (including Net Membership Cash Flow,
but exclusive of amounts on deposit in the Membership Deposit Account) and other
fees and charges

                                       20
<PAGE>

payable pursuant to Leases or otherwise in connection with the Property, and
business interruption, rent or other similar insurance proceeds determined on an
accrual basis of accounting. Operating Income shall not include (a) Insurance
Proceeds (other than proceeds of rent, business interruption or other similar
insurance allocable to the applicable period) and Condemnation Proceeds (other
than Condemnation Proceeds arising from a temporary taking or the use and
occupancy of all or part of the applicable Property allocable to the applicable
period), or interest accrued on such Condemnation Proceeds, (b) proceeds of any
financing, (c) proceeds of any sale, exchange or transfer of the Property or any
part thereof or interest therein, (d) capital contributions or loans to Borrower
or an Affiliate of Borrower, (e) any item of income otherwise includable in
Operating Income but paid directly by any tenant to a Person other than Borrower
except for real estate taxes paid directly to any taxing authority by any
tenant, (f) any other extraordinary, non-recurring revenues, (g) Rent paid by or
on behalf of any one or more lessee(s) under an Operating Lease or Space Lease,
the demised premises of which collectively aggregate 10,000 square feet or more,
which is the subject of any proceeding or action relating to its bankruptcy,
reorganization or other arrangement pursuant to the Bankruptcy Code or any
similar federal or state law or which has been adjudicated a bankrupt or
insolvent unless such Operating Lease or Space Lease, as applicable, has been
affirmed by the trustee in such proceeding or action, (h) Rent paid by or on
behalf of any lessee under a Lease the demised premises of which are not
occupied either by such lessee or by a sublessee thereof; or (i) sales tax
rebates from any Governmental Authority.

      "Operating Lease" shall mean that certain Lease Agreement, dated as of the
date hereof, between Borrower, as landlord, and Operating Tenant, as tenant, as
the same may be amended from time to time and any subsequent operating lease for
the Property or any portion thereof which has been approved in writing by
Lender.

      "Operating Tenant" shall mean CNL GL Resort Tenant Corp., a Delaware
corporation and its successors and assigns and any subsequent tenant under the
Operating Lease.

      "Operation and Maintenance Expense Escrow Account" shall mean the Escrow
Account maintained pursuant to Section 5.09 hereof relating to the payment of
Operating Expenses (exclusive of Basic Carrying Costs).

      "Operation and Maintenance Expense Sub-Account" shall mean the Sub-Account
of the Central Account established pursuant to Section 5.02 hereof into which
sums allocated for the payment of Cash Expenses, Net Capital Expenditures and
approved Extraordinary Expenses shall be deposited.

      "Pad Owners" shall mean any owner of any fee interest in property
contiguous to or surrounded by the Property who has entered into or is subject
to a reciprocal easement agreement or other agreement or agreements with
Borrower either (a) in connection with an existing or potential improvement on
such property or (b) relating to or affecting the Property.

      "Payment Date" shall mean, with respect to each month, the first (1st)
calendar day in such month, or if such day is not a Business Day, the next
following Business Day.

                                       21
<PAGE>

      "PBGC" shall mean the Pension Benefit Guaranty Corporation established
under ERISA, or any successor thereto.

      "Permitted Encumbrances" shall have the meaning set forth in Section
2.05(a) hereof.

      "Person" shall mean any individual, corporation, limited liability
company, partnership, joint venture, estate, trust, unincorporated association,
any federal, state, county or municipal government or any bureau, department or
agency thereof and any fiduciary acting in such capacity on behalf of any of the
foregoing.

      "Plan" shall mean an employee benefit or other plan established or
maintained by Borrower, Guarantor or any ERISA Affiliate during the five-year
period ended prior to the date of this Security Instrument or to which Borrower,
Guarantor or any ERISA Affiliate makes, is obligated to make or has, within the
five year period ended prior to the date of this Security Instrument, been
required to make contributions (whether or not covered by Title IV of ERISA or
Section 302 of ERISA or Section 401(a) or 412 of the Code), other than a
Multiemployer Plan.

      "Premises" shall have the meaning set forth in granting clause (a) of this
Security Instrument.

      "Principal Amount" shall mean the Loan Amount as such amount may be
reduced from time to time pursuant to the terms of this Security Instrument, the
Note or the other Loan Documents.

      "Principal Payments" shall mean all payments of principal made pursuant to
the terms of the Note.

      "Prohibited Person" means any Person and/or any Affiliate thereof
identified on the OFAC List or any other Person or foreign country or agency
thereof with whom a U.S. Person may not conduct business or transactions by
prohibition of Federal law or Executive Order of the President of the United
States of America.

      "Property" shall have the meaning set forth in the granting clauses of
this Security Instrument.

      "Property Agreements" shall mean all agreements, grants of easements
and/or rights-of-way, reciprocal easement agreements, permits, declarations of
covenants, conditions and restrictions, disposition and development agreements,
planned unit development agreements, parking agreements, party wall agreements
or other instruments affecting the Property, including, without limitation any
agreements with Pad Owners, but not including any brokerage agreements,
management agreements, service contracts, Space Leases or the Loan Documents.

      "Property Available Cash" shall mean all amounts payable to Borrower
and/or Operating Lessee pursuant to the Management Agreement which exists as of
the Closing Date or any Approved Replacement Management Agreement.

                                       22
<PAGE>

      "Rating Agency" shall mean each of Standard & Poor's Ratings Services, a
division of The McGraw-Hill Company, Inc. ("Standard & Poor's"), Fitch, Inc.,
and Moody's Investors Service, Inc. ("Moody's") and any successor to any of
them; provided, however, that at any time after a Securitization, "Rating
Agency" shall mean those of the foregoing rating agencies that from time to time
rate the securities issued in connection with such Securitization.

      "Real Estate Taxes" shall mean all real estate taxes, assessments
(including, without limitation, all assessments for public improvements or
benefits, whether or not commenced or completed prior to the date hereof and
whether or not commenced or completed within the term of this Security
Instrument) and similar other governmental charges, in each case whether general
or special, ordinary or extraordinary, or foreseen or unforeseen (including all
interest and penalties thereon), which at any time prior to, during or in
respect of the term hereof may be assessed or imposed as a lien upon the
Property or any part thereof or any estate, right, title or interest therein.

      "Realty" shall have the meaning set forth in Section 2.05(b) hereof.

      "Recurring Replacement Expenditures" shall mean expenditures related to
capital repairs, replacements and improvements performed at the Property from
time to time in accordance with the provisions of the Management Agreement.

      "Recurring Replacement Reserve Monthly Installment" shall mean an amount
per month equal to (a) such amount as is required to be deposited into a
replacement reserve or FF&E reserve or similar reserve pursuant to the
Management Agreement which existed as of the Closing Date or any Approved
Replacement Management Agreement but, following the commencement of the third
(3rd) Loan Year, in no event less than three percent (3%) of the total revenues
of the Property for the month commencing on the Payment Date in the month which
is two (2) months prior to the Payment Date upon which the Recurring Replacement
Reserve Monthly Installment is being calculated (e.g., the Recurring Replacement
Reserve Monthly Installment for the month of April, shall be calculated based on
the total revenues of the Property for February); provided, however, if Lender
has not received financial statements for the month upon which the calculation
is to be based, the Recurring Replacement Reserve Monthly Installment shall be
based upon the most recent month for which such financial statement was received
as adjusted by Lender in its reasonable discretion. Notwithstanding the
foregoing, if Borrower is depositing a sum with Manager on a monthly basis
pursuant to the Management Agreement to be used for the payment of the Recurring
Replacement Expenditures, Lender has a perfected first priority security
interest in the account in which such sums are deposited and Borrower delivers
to Lender proof the Recurring Replacement Expenditures are paid not less than
ten (10) Business Days prior to the date upon which they are due and payable,
the Recurring Replacement Reserve Monthly Installment shall be $0.

      "Recurring Replacement Reserve Escrow Account" shall mean the Escrow
Account maintained pursuant to Section 5.08 hereof relating to the payment of
Recurring Replacement Expenditures.

                                       23
<PAGE>

      "Recurring Replacement Reserve Sub-Account" shall mean the Sub-Account of
the Central Account established pursuant to Section 5.02 hereof into which the
Recurring Replacement Reserve Monthly Installment shall be deposited.

      "Regulation AB" shall mean Regulation AB under the Securities Act and the
Securities Exchange Act of 1934 (as amended).

      "Release" shall have the meaning set forth in Section 15.02 hereof.

      "Release Price" shall have the meaning set forth in Section 15.02 hereof.

      "Rents" shall have the meaning set forth in granting clause (f) of this
Security Instrument.

      "Rent Roll" shall have the meaning set forth in Section 2.05 (o) hereof.

      "Required Debt Service Payment" shall mean, as of any Payment Date, (a)
the amount of interest and principal then due and payable pursuant to the Note,
together with any other sums due thereunder, including, without limitation, any
prepayments required to be made or for which notice has been given under this
Security Instrument, Default Rate Interest and premium, if any, paid in
accordance therewith plus (b) reasonable out-of-pocket fees incurred by Lender
in connection with its administration and servicing of the Central Account.

      "Required Engineering Work" shall mean the immediate engineering and/or
environmental remediation work set forth on EXHIBIT D attached hereto and made a
part hereof.

      "Retention Amount" shall have the meaning set forth in Section
3.04(b)(vii) hereof.

      "Ritz Premises" shall mean that portion of the Premises described in
EXHIBIT A-2 attached hereto and made a part hereof.

      "Scheduled Defeasance Payments" shall mean:

            (a) with respect to a defeasance of the Loan in whole, payments on
      or prior to, but as close as possible to (i) each scheduled Payment Date,
      after the date of defeasance and through and including the Lockout
      Expiration Date, upon which interest payments or interest and Principal
      Payments are required under the Loan Documents and in amounts equal to the
      scheduled payments due on such dates under the Loan Documents and (ii) the
      Lockout Expiration Date, of the Principal Amount and any accrued and
      unpaid interest thereon; or

            (b) with respect to any defeasance of the Loan in part, payments on
      or prior to, but as close as possible to, (i) each scheduled Payment Date
      after the date of defeasance through and including the Lockout Expiration
      Date, of a proportionate share (based on the percentage of outstanding
      principal prior to the defeasance represented by the amount of principal
      defeased) of the monthly installments of principal and interest due on
      such dates under the Loan Documents and (ii) the Lockout Expiration Date,
      of the

                                       24
<PAGE>

      unpaid portion of the portion of the Principal Amount so defeased and any
      accrued and unpaid interest thereon.

            (c) with respect to any defeasance of the Loan in part which is made
      in connection with a Release pursuant to Section 15.02 hereof, payments on
      or prior to, but as close as possible to, (i) each scheduled Payment Date
      after the date of defeasance through and including the Lockout Expiration
      Date, of a proportionate share (based on the percentage of outstanding
      principal prior to the defeasance represented by the Release Price) of the
      monthly installments of principal and interest due on such dates under the
      Loan Documents and (ii) the Lockout Expiration Date, of the Release Price
      and any accrued and unpaid interest thereon.

      "Securities Act" shall mean the Securities Act of 1933, as the same shall
be amended from time to time.

      "Securitization" shall mean a public or private offering of securities by
Lender or any of its Affiliates or their respective successors and assigns which
are collateralized, in whole or in part, by this Security Instrument.

      "Security Agreement" shall have the meaning set forth in Section 15.01
hereof.

      "Security Deposit Account" shall have the meaning set forth in Section
5.01 hereof.

      "Security Instrument" shall mean this Security Instrument as originally
executed or as it may hereafter from time to time be supplemented, amended,
modified or extended by one or more indentures supplemental hereto.

      "Significant Obligor" shall have the meaning set forth in Item 1101(k) of
Regulation AB.

      "Single Purpose Entity" shall mean a corporation, partnership, joint
venture, limited liability company, trust or unincorporated association, which
is formed or organized solely for the purpose of holding, directly, an ownership
interest in the Property or, with respect to General Partner, holding an
ownership interest in and managing a Person which holds an ownership interest in
the Property, or, with respect to Operating Tenant, holding a leasehold interest
in the Property, does not engage in any business unrelated to the Property, does
not have any assets other than those related to its interest in the Property or
any indebtedness other than as permitted by this Security Instrument or the
other Loan Documents, has its own separate books and records and has its own
accounts, in each case which are separate and apart from the books and records
and accounts of any other Person, holds itself out as being a Person separate
and apart from any other Person and which otherwise satisfies the criteria of
the Rating Agency, as in effect on the Closing Date, for a special-purpose
bankruptcy-remote entity.

      "Solvent" shall mean, as to any Person, that (a) the sum of the assets of
such Person, at a fair valuation, exceeds its liabilities, including contingent
liabilities, (b) such Person has sufficient capital with which to conduct its
business as presently conducted and as proposed to be conducted and (c) such
Person has not incurred debts, and does not intend to incur debts, beyond

                                       25
<PAGE>

its ability to pay such debts as they mature. For purposes of this definition,
"debt" means any liability on a claim, and "claim" means (a) a right to payment,
whether or not such right is reduced to judgment, liquidated, unliquidated,
fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable,
secured or unsecured, or (b) a right to an equitable remedy for breach of
performance if such breach gives rise to a payment, whether or not such right to
an equitable remedy is reduced to judgment, fixed, contingent, matured,
unmatured, disputed, undisputed, secured, or unsecured. With respect to any such
contingent liabilities, such liabilities shall be computed in accordance with
GAAP at the amount which, in light of all the facts and circumstances existing
at the time, represents the amount which can reasonably be expected to become an
actual or matured liability.

      "Space Leases" shall mean any Lease or sublease thereunder (including,
without limitation, any Major Space Lease) or any other agreement providing for
the use and occupancy of a portion of the Property as the same may be amended,
renewed or supplemented.

      "State" shall mean any of the states which are members of the United
States of America.

      "Stated Maturity" when used with respect to the Note or any installment of
interest and/or principal payment thereunder, shall mean the date specified in
the Note as the fixed date on which a payment of all or any portion of principal
and/or interest is due and payable.

      "STR" shall mean Smith Travel Research.

      "Sub-Accounts" shall have the meaning set forth in Section 5.02 hereof.

      "Substantial Casualty" shall have the meaning set forth in Section 3.04
hereof.

      "Taking" shall mean a condemnation or taking pursuant to the lawful
exercise of the power of eminent domain.

      "Transfer" shall mean the conveyance, assignment, sale, mortgaging,
encumbrance, pledging, hypothecation, granting of a security interest in,
granting of options with respect to, or other disposition of (directly or
indirectly, voluntarily or involuntarily, by operation of law or otherwise, and
whether or not for consideration or of record) all or any portion of any legal
or beneficial interest (a) in all or any portion of the Property; (b) if
Borrower or, if Borrower is a partnership, any General Partner, is a
corporation, in the stock of Borrower or any General Partner; (c) in Borrower
(or any trust of which Borrower is a trustee); or (d) if Borrower is a limited
or general partnership, joint venture, limited liability company, trust, nominee
trust, tenancy in common or other unincorporated form of business association or
form of ownership interest, in any Person having a legal or beneficial ownership
in Borrower, excluding any legal or beneficial interest in any constituent
limited partner, if Borrower is a limited partnership, or in any non-managing
member, if Borrower is a limited liability company, unless such interest would,
or together with all other direct or indirect interests in Borrower which were
previously transferred, aggregate 49% or more of the partnership or membership,
as applicable, interest in Borrower or would result in any Person who, as of the
Closing Date, did not own, directly or indirectly, 49% or more of the
partnership or membership, as applicable, interest in Borrower,

                                       26
<PAGE>

owning, directly or indirectly, 49% or more of the partnership or membership, as
applicable, interest in Borrower and excluding any legal or beneficial interest
in any General Partner unless such interest would, or together with all other
direct or indirect interest in the General Partner which were previously
transferred, aggregate 49% or more of the partnership or membership, as
applicable, interest in the General Partner (or result in a change in Control of
the management of the General Partner upon the conveyance or other disposition
of such legal or beneficial interest) and shall also include, without limitation
to the foregoing, the following: an installment sales agreement wherein Borrower
agrees to sell the Property or any part thereof or any interest therein for a
price to be paid in installments; an agreement by Borrower leasing all or
substantially all of the Property to one or more Persons pursuant to a single or
related transactions, or a sale, assignment or other transfer of, or the grant
of a security interest in, Borrower's right, title and interest in and to any
Leases or any Rent; any instrument subjecting the Property to a condominium
regime or transferring ownership to a cooperative corporation; and the
dissolution or termination of Borrower or the merger or consolidation of
Borrower with any other Person. Notwithstanding any provision herein to the
contrary, "Transfer" shall not include (a) transfers of publicly traded stock in
Guarantor or CNL Hotels & Resorts, Inc., a Maryland corporation ("CHR") on a
national stock exchange or on the NASDAQ stock market in the normal course of
business and not in connection with a tender offer or a sale of Guarantor or CHR
or substantially all of the direct or indirect assets of Guarantor or CHR or (b)
a merger of Guarantor or CHR into another Person (the "Survivor") so long as (i)
after giving effect to such merger, the identity of a majority of members of the
board of directors of the Survivor are individuals that (immediately prior to
such merger) were members of the board of directors of the predecessor Guarantor
or CHR, as applicable, and continue to maintain operational and management
control of Survivor (and, in such event, Survivor shall become the Guarantor
hereunder) and (ii) Lender has received a letter from each Rating Agency
confirming that any rating issues by the Rating Agency in connection with a
Securitization will not, as a result of the proposed merger, be downgraded from
the then current ratings thereof, qualified or withdrawn, and (c) in the event
that any Person (a "Principal Transferee") who does not, as of the Closing Date,
own or Control, directly or indirectly, 49% or more of the stock, partnership
interest or membership interest, as applicable, in Borrower acquires, directly
or indirectly, 49% or more of the stock, partnership interest or membership
interest, as applicable, in Borrower as a result of such transfer, conveyance,
assignment, sale, mortgaging, encumbrance, pledging, hypothecation or granting
of a security interest, Lender shall be furnished an opinion, in form and
substance and from counsel reasonably satisfactory to Lender, substantially
similar to the Insolvency Opinion which discusses the substantive
non-consolidation of Borrower with the Principal Transferee in the event of a
bankruptcy, insolvency or similar proceeding relating to the Principal
Transferee.

      "UCC" shall mean the Uniform Commercial Code as in effect in the State in
which the Realty is located.

      "Undefeased Note" shall have the meaning set forth in Section 15.01
hereof.

      "Uniform System of Accounts" shall mean the Uniform System of Accounts for
the Lodging Industry, 9th Revised Edition, Educational Institute of the American
Hotel and Motel Association and Hotel Association of New York City (1996), as
from time to time amended.

                                       27
<PAGE>

      "Unscheduled Payments" shall mean (a) all Loss Proceeds that Borrower has
elected or is required to apply to the repayment of the Debt pursuant to this
Security Instrument, the Note or any other Loan Documents, (b) any funds
representing a voluntary or involuntary principal prepayment other than
scheduled Principal Payments and (c) any Net Proceeds.

      "Use Requirements" shall mean any and all building codes, permits,
certificates of occupancy or compliance, laws, regulations, or ordinances
(including, without limitation, health, pollution, fire protection, medical and
day-care facilities, waste product and sewage disposal regulations),
restrictions of record, easements, reciprocal easements, declarations or other
agreements affecting the use of the Property or any part thereof.

      "Welfare Plan" shall mean an employee welfare benefit plan as defined in
Section 3(1) of ERISA established or maintained by Borrower, Guarantor or any
ERISA Affiliate or that covers any current or former employee of Borrower,
Guarantor or any ERISA Affiliate.

      "Work" shall have the meaning set forth in Section 3.04(a)(i) hereof.

                     ARTICLE II: REPRESENTATIONS, WARRANTIES
                           AND COVENANTS OF BORROWER

      Section 2.01. Payment of Debt. Borrower will pay the Debt at the time and
in the manner provided in the Note and the other Loan Documents, all in lawful
money of the United States of America in immediately available funds.

      Section 2.02. Representations, Warranties and Covenants of Borrower.
Borrower represents and warrants to and covenants with

Lender:

            (a) Organization and Authority. Borrower (i) is a limited liability
company, general partnership, limited partnership or corporation, as the case
may be, duly organized, validly existing and in good standing under the laws of
the jurisdiction of its formation, (ii) has all requisite power and authority to
own the Property and to carry on its business as now conducted and as presently
proposed to be conducted and (iii) is duly qualified, authorized to do business
and in good standing in the jurisdiction where the Property is located and in
each other jurisdiction where the conduct of its business or the nature of its
activities makes such qualification necessary. If Borrower is a limited
liability company, limited partnership or general partnership, each general
partner or managing member, as applicable, of Borrower which is a corporation is
duly organized, validly existing, and in good standing under the laws of the
jurisdiction of its incorporation.

            (b) Power. Borrower and, if applicable, each General Partner has
full power and authority to execute, deliver and perform, as applicable, the
Loan Documents to which it is a party, to make the borrowings thereunder, to
execute and deliver the Note and to grant to Lender a first, prior, perfected
and continuing lien on and security interest in the Property, subject only to
the Permitted Encumbrances.

                                       28
<PAGE>

            (c) Authorization of Borrowing. The execution, delivery and
performance of the Loan Documents to which Borrower is a party, the making of
the borrowings thereunder, the execution and delivery of the Note, the grant of
the liens on the Property pursuant to the Loan Documents to which Borrower is a
party and the consummation of the Loan are within the powers of Borrower and
have been duly authorized by Borrower and, if applicable, the General Partners,
by all requisite action (and Borrower hereby represents that no approval or
action of any member, limited partner or shareholder, as applicable, of Borrower
is required to authorize any of the Loan Documents to which Borrower is a party)
and will constitute the legal, valid and binding obligation of Borrower,
enforceable against Borrower in accordance with their terms, except as
enforcement may be stayed or limited by bankruptcy, insolvency or similar laws
affecting the enforcement of creditors' rights generally and by general
principles of equity (whether considered in proceedings at law or in equity) and
will not (i) violate any provision of its partnership agreement or partnership
certificate or certificate of incorporation or by-laws, or operating agreement,
certificate of formation or articles of organization, as applicable, or, to its
knowledge, any law, judgment, order, rule or regulation of any court,
arbitration panel or other Governmental Authority, domestic or foreign, or other
Person affecting or binding upon Borrower or the Property, or (ii) violate any
provision of any indenture, agreement, mortgage, deed of trust, contract or
other instrument to which Borrower or, if applicable, any General Partner is a
party or by which any of their respective property, assets or revenues are
bound, or be in conflict with, result in an acceleration of any obligation or a
breach of or constitute (with notice or lapse of time or both) a default or
require any payment or prepayment under, any such indenture, agreement,
mortgage, deed of trust, contract or other instrument, or (iii) result in the
creation or imposition of any lien, except those in favor of Lender as provided
in the Loan Documents to which it is a party.

            (d) Consent. Neither Borrower nor, if applicable, any General
Partner, is required to obtain any consent, approval or authorization from, or
to file any declaration or statement with, any Governmental Authority or other
agency in connection with or as a condition to the execution, delivery or
performance of this Security Instrument, the Note or the other Loan Documents
which has not been so obtained or filed.

            (e) Interest Rate. The rate of interest paid under the Note and the
method and manner of the calculation thereof do not violate any usury or other
law or applicable Legal Requirement.

            (f) Other Agreements. Borrower is not a party to nor is otherwise
bound by any agreements or instruments which, individually or in the aggregate,
are reasonably likely to have a Material Adverse Effect. Neither Borrower nor,
if applicable, any General Partner, is in violation of its organizational
documents or other restriction or any agreement or instrument by which it is
bound, or any judgment, decree, writ, injunction, order or award of any
arbitrator, court or Governmental Authority, or any Legal Requirement, in each
case, applicable to Borrower or the Property, except for such violations that
would not, individually or in the aggregate, have a Material Adverse Effect.

                                       29
<PAGE>

            (g) Maintenance of Existence. (i) Borrower is familiar with all of
the criteria of the Rating Agency required to qualify as a special-purpose
bankruptcy-remote entity and Borrower, Operating Tenant and, if applicable, each
General Partner at all times since their formation have been duly formed and
existing and shall preserve and keep in full force and effect their existence as
a Single Purpose Entity.

            (ii) Borrower, Operating Tenant and, if applicable, each General
      Partner, at all times since their organization have complied, and will
      continue to comply, with the provisions of its certificate and agreement
      of partnership or certificate of incorporation and by-laws or articles of
      organization, certificate of formation and operating agreement, as
      applicable, and the laws of its jurisdiction of organization relating to
      partnerships, corporations or limited liability companies, as applicable.

            (iii) Borrower, Operating Tenant and, if applicable, each General
      Partner have done or caused to be done and will do all things necessary to
      observe organizational formalities and preserve their existence and
      Borrower, Operating Tenant and, if applicable, each General Partner will
      not amend, modify or otherwise change the certificate and agreement of
      partnership or certificate of incorporation and by-laws or articles of
      organization, certificate of formation and operating agreement, as
      applicable, or other organizational documents of Borrower, Operating
      Tenant and, if applicable, each General Partner.

            (iv) Borrower, Operating Tenant and, if applicable, each General
      Partner, have at all times accurately maintained, and will continue to
      accurately maintain, their respective financial statements, accounting
      records and other partnership, company or corporate documents separate
      from those of any other Person and Borrower and Operating Tenant will file
      its own tax returns or, if Borrower, Operating Tenant and/or, if
      applicable, General Partner is part of a consolidated group for purposes
      of filing tax returns, Borrower, Operating Tenant and, General Partner, as
      applicable will be shown as separate members of such group. Borrower,
      Operating Tenant and, if applicable, each General Partner have not at any
      time since their formation commingled, and will not commingle, their
      respective assets (other than assets of Borrower, Operating Tenant, each
      General Partner and Manager with respect to the Property as contemplated
      by the Loan Documents, the Management Agreement and the Insolvency
      Opinion) with those of any other Person and will maintain their assets in
      such a manner such that it will not be costly or difficult to segregate,
      ascertain or identify their individual assets from those of any other
      Person. Borrower, Operating Tenant and, if applicable, each General
      Partner will not permit any Affiliate independent access to their bank
      accounts. Borrower, Operating Tenant and, if applicable, each General
      Partner have at all times since their formation accurately maintained and
      utilized, and will continue to accurately maintain and utilize, their own
      separate bank accounts, checks and books of account and, if applicable,
      payroll, stationery and invoices.

            (v) Borrower, Operating Tenant and, if applicable, each General
      Partner, have at all times paid, and will continue to pay, their own
      liabilities from their own separate

                                       30
<PAGE>

      assets and shall each allocate and charge fairly and reasonably any
      overhead which Borrower, Operating Tenant and, if applicable, any General
      Partner, shares with any other Person, including, without limitation, for
      office space and services performed by any employee of another Person.

            (vi) Borrower, Operating Tenant and, if applicable, each General
      Partner, have at all times identified themselves, and will continue to
      identify themselves, in all of their dealings with the public, under their
      own names and as separate and distinct entities and shall correct any
      known misunderstanding regarding their status as separate and distinct
      entities. Borrower, Operating Tenant and, if applicable, each General
      Partner, have not at any time identified themselves, and will not identify
      themselves, as being a division of any other Person.

            (vii) Borrower, Operating Tenant and, if applicable, each General
      Partner, have been at all times, and will continue to be, adequately
      capitalized in light of the nature of their respective businesses.

            (viii) Borrower, Operating Tenant and, if applicable, each General
      Partner, (A) have not owned, do not own and will not own any assets or
      property other than, with respect to Borrower, the Property and any
      incidental personal property necessary for the ownership, management or
      operation of the Property, with respect to Operating Tenant, its interest
      in the Operating Lease and the Management Agreement and personal property
      interests incidental thereto, and, with respect to General Partner, if
      applicable, its interest in Borrower, (B) have not engaged and will not
      engage in any business other than, with respect to Borrower, the
      ownership, management and operation of the Property, with respect to
      Operating Tenant, the ownership of its interest in the Operating Lease and
      management and operation of the Property thereunder or, with respect to
      General Partner, if applicable, its interest in Borrower, (C) have not
      incurred and will not incur any debt, secured or unsecured, direct or
      contingent (including guaranteeing any obligation), other than, with
      respect to Borrower, (W) the Loan, (X) unsecured trade and operational
      debt which (1) is not evidenced by a note, (2) is incurred in the ordinary
      course of the operation of the Property, (3) does not, together with any
      equipment financing incurred pursuant to clause (Y) hereof exceed in the
      aggregate three percent (3%) of the Allocated Loan Amount and (4) is,
      unless being contested in accordance with the terms of this Security
      Instrument, paid prior to the earlier to occur of the sixtieth (60th) day
      after the date incurred and the date when due, (Y) equipment financing
      relating to equipment used in connection with the operation of the
      Property which (1) is incurred in the ordinary course of the operation of
      the Property and (2) does not, together with any unsecured trade and
      operational debt incurred pursuant to clause (X) hereof, exceed in the
      aggregate two percent (2%) of the Allocated Loan Amount and (Z) contingent
      obligations to repay customer, membership and security deposits held in
      the ordinary course of Borrower's business, (D) have not pledged and will
      not pledge their assets for the benefit of any other Person, and (E) have
      not made and will not make any loans or advances to any Person (including
      any Affiliate).

                                       31
<PAGE>

            (ix) None of Borrower, Operating Tenant nor, if applicable, any
      General Partner will change its name or principal place of business
      without giving Lender at least thirty (30) days prior written notice
      thereof.

            (x) None of Borrower, Operating Tenant nor, if applicable, any
      General Partner has, and neither of such Persons will have, any
      subsidiaries (other than, in the case of General Partner, its general
      partner interest in Borrower).

            (xi) Borrower will preserve and maintain its existence as a Delaware
      limited partnership and all material rights, privileges, tradenames and
      franchises and Operating Tenant will preserve and maintain its existence
      as a Delaware limited partnership and all material rights, privileges,
      tradenames and franchises.

            (xii) None of Borrower, Operating Tenant nor, if applicable, any
      General Partner, will merge or consolidate with, or sell all or
      substantially all of its respective assets to any Person, or liquidate,
      wind up or dissolve itself (or suffer any liquidation, winding up or
      dissolution). None of Borrower, Operating Tenant nor, if applicable, any
      General Partner will acquire any business or assets from, or capital stock
      or other ownership interest of, or be a party to any acquisition of, any
      Person (other than, in the case of General Partner, its general partner
      interest in Borrower).

            (xiii) Borrower, Operating Tenant and, if applicable, each General
      Partner, have not at any time since their formation assumed, guaranteed or
      held themselves out to be responsible for, and will not assume, guarantee
      or hold themselves out to be responsible for the liabilities or the
      decisions or actions respecting the daily business affairs of their
      partners, shareholders or members or any predecessor company, corporation
      or partnership, each as applicable, any Affiliates, or any other Persons.
      Neither Borrower nor Operating Tenant nor, if applicable, General Partner
      has at any time since its formation acquired, and will not acquire,
      obligations or securities of its partners or shareholders, members or any
      predecessor company, corporation or partnership, each as applicable, or
      any Affiliates (other than, in the case of General Partner, its general
      partner interest in Borrower). Borrower, Operating Tenant and, if
      applicable, each General Partner, have not at any time since their
      formation made, and will not make, loans to its partners, members or
      shareholders or any predecessor company, corporation or partnership, each
      as applicable, or any Affiliates of any of such Persons. Borrower,
      Operating Tenant and, if applicable, each General Partner, have no known
      contingent liabilities nor do they have any material financial liabilities
      under any indenture, mortgage, deed of trust, loan agreement or other
      agreement or instrument to which such Person is a party or by which it is
      otherwise bound other than under the Loan Documents.

            (xiv) Neither Borrower nor Operating Tenant nor, if applicable,
      General Partner has at any time since its formation entered into and was
      not a party to, and, will not enter into or be a party to, any transaction
      with its Affiliates, members, partners or shareholders, as applicable, or
      any Affiliates thereof except in the ordinary course of business of
      Borrower, Operating Tenant or General Partner, as applicable, on terms

                                       32
<PAGE>

      which are no less favorable to such Person than would be obtained in a
      comparable arm's length basis with an unaffiliated third party.

            (xv) If Borrower or Operating Tenant is a limited partnership or a
      limited liability company, the General Partner shall be a corporation or
      limited liability company whose sole asset is its interest in Borrower or
      Operating Tenant, as applicable, and the General Partner will at all times
      comply, and will cause Borrower or Operating Tenant, as applicable, to
      comply, with each of the representations, warranties, and covenants
      contained in this Section 2.02(g) as if such representation, warranty or
      covenant was made directly by such General Partner.

            (xvi) Borrower and Operating Tenant shall at all times cause there
      to be at least two (or with respect to Operating Tenant, one) duly
      appointed members of the board of directors or board of managers or other
      governing board or body, as applicable (each, an "Independent Director"),
      of, if Borrower or Operating Tenant is a corporation, Borrower or
      Operating Tenant, as applicable, if Borrower or Operating Tenant is a
      limited partnership, of the General Partner, and if Borrower or Operating
      Tenant is a limited liability company, of the General Partner or of
      Borrower or Operating Tenant, as applicable, reasonably satisfactory to
      Lender who shall not have been at the time of such individual's
      appointment, and may not be or have been at any time (A) a shareholder,
      officer, director, attorney, counsel, partner, member or employee of
      Borrower, Operating Tenant or any of the foregoing Persons or Affiliates
      thereof , (B) a customer or creditor of, or supplier or service provider
      to, Borrower or any of its shareholders, partners, members or their
      Affiliates (other than consumer transactions, such as hotel guest or
      senior living facility stays, in the ordinary course of business), (C) a
      member of the immediate family of any Person referred to in (A) or (B)
      above or (D) a Person Controlling, Controlled by or under common Control
      with any Person referred to in (A) through (C) above. A natural person who
      otherwise satisfies the foregoing definition except for being the
      Independent Director of a Single Purpose Entity Affiliated with Borrower
      or General Partner shall not be disqualified from serving as an
      Independent Director if such individual is at the time of initial
      appointment, or at any time while serving as the Independent Director, an
      Independent Director of a Single Purpose Entity Affiliated with Borrower
      or General Partner if such individual is an independent director provided
      by a nationally-recognized company that provides professional independent
      directors.

            (xvii) Borrower, Operating Tenant and, if applicable, each General
      Partner, shall not cause or permit the board of directors or board of
      managers or other governing board or body, as applicable, of Borrower,
      Operating Tenant or, if applicable, each General Partner, to take any
      action which, under the terms of any certificate of incorporation, by-laws
      or articles of organization with respect to any common stock, requires a
      vote of the board of directors of Borrower or Operating Tenant or, if
      applicable, the General Partner, unless at the time of such action there
      shall be at least two (or with respect to Operating Tenant, one) members
      who are Independent Directors.

                                       33
<PAGE>

            (xviii) Borrower, Operating Tenant and, if applicable, each General
      Partner shall pay the salaries of their own employees and maintain a
      sufficient number of employees in light of their contemplated business
      operations.

            (xix) Borrower shall, and shall cause its Affiliates to, conduct its
      business so that the assumptions made with respect to Borrower and such
      Affiliates in that certain opinion letter relating to substantive
      non-consolidation dated the date hereof (the "Insolvency Opinion")
      delivered in connection with the Loan shall be true and correct in all
      respects.

      Notwithstanding anything to the contrary contained in this Section
2.02(g), provided Borrower or Operating Tenant, as applicable, is a Delaware
single member limited liability company which satisfies the single purpose
bankruptcy remote entity requirements of each Rating Agency for a single member
limited liability company, the foregoing provisions of this Section 2.02(g)
shall not apply to the General Partner.

      (h) No Defaults. No Default or Event of Default has occurred and is
continuing or would occur as a result of the consummation of the transactions
contemplated by the Loan Documents. Borrower is not in default in the payment or
performance of any of its Contractual Obligations in any material respect.

      (i) Consents and Approvals. Borrower and, if applicable, each General
Partner, have obtained or made all necessary (i) consents, approvals and
authorizations, and registrations and filings of or with all Governmental
Authorities and (ii) consents, approvals, waivers and notifications of partners,
stockholders, members, creditors, lessors and other nongovernmental Persons, in
each case, which are required to be obtained or made by Borrower or, if
applicable, the General Partner, in connection with the execution and delivery
of, and the performance by Borrower of its obligations under, the Loan
Documents.

      (j) Investment Company Act Status, etc. Borrower is not (i) an "investment
company," or a company "controlled" by an "investment company," as such terms
are defined in the Investment Company Act of 1940, as amended, (ii) a "holding
company" or a "subsidiary company" of a "holding company" or an "affiliate" of
either a "holding company" or a "subsidiary company" within the meaning of the
Public Utility Holding Company Act of 1935, as amended, or (iii) subject to any
other federal or state law or regulation which purports to restrict or regulate
its ability to borrow money.

      (k) Compliance with Law. Borrower is in compliance in all material
respects with all Legal Requirements to which it or the Property is subject,
including, without limitation, all Environmental Statutes, the Occupational
Safety and Health Act of 1970, the Americans with Disabilities Act and ERISA. No
portion of the Property has been or will be purchased, improved, fixtured,
equipped or furnished with proceeds of any illegal activity and, to the best of
Borrower's knowledge, no illegal activities are being conducted at or from the
Property.

      (l) Financial Information. All financial data that has been delivered by
Borrower to Lender (i) is true, complete and correct in all material respects,
(ii) fairly represents the financial

                                       34
<PAGE>

condition and results of operations of the Persons covered thereby as of the
date of such reports, and, if applicable (iii) has been prepared in accordance
with GAAP or the Uniform System of Accounts, as applicable (or such other
accounting basis as is reasonably acceptable to Lender) throughout the periods
covered thereby. As of the date hereof, none of Borrower, Operating Tenant or,
if applicable, any General Partner, has any material contingent liability,
liability for delinquent taxes or other unusual or forward commitment not
reflected in such financial statements delivered to Lender. Since the date of
the last financial statements delivered by Borrower to Lender except as
otherwise disclosed in such financial statements or notes thereto, there has
been no change in the assets, liabilities or financial position of Borrower nor,
if applicable, any General Partner, or in the results of operations of Borrower
which would have a Material Adverse Effect. Neither Borrower nor, if applicable,
any General Partner, has incurred any obligation or liability, contingent or
otherwise not reflected in such financial statements which would have a Material
Adverse Effect.

      (m) Transaction Brokerage Fees. Borrower has not dealt with any brokers,
underwriters, placement agents, agents or finders in connection with the
transactions contemplated by this Security Instrument. All brokerage fees,
commissions and other expenses payable in connection with the transactions
contemplated by the Loan Documents have been paid in full by Borrower
contemporaneously with the execution of the Loan Documents and the funding of
the Loan. Borrower hereby agrees to indemnify and hold Lender harmless for, from
and against any and all claims, liabilities, costs and expenses of any kind in
any way relating to or arising from (i) a claim by any Person that such Person
acted on behalf of Borrower in connection with the transactions contemplated
herein or (ii) any breach of the foregoing representation. The provisions of
this subsection (m) shall survive the repayment of the Debt.

      (n) Federal Reserve Regulations. No part of the proceeds of the Loan will
be used for the purpose of "purchasing" or "carrying" any "margin stock" within
the meaning of Regulations T, U or X of the Board of Governors of the Federal
Reserve System or for any other purpose which would be inconsistent with such
Regulations T, U or X or any other Regulations of such Board of Governors, or
for any purposes prohibited by Legal Requirements or by the terms and conditions
of the Loan Documents.

      (o) Pending Litigation. There are no actions, suits or proceedings pending
or, to the best knowledge of Borrower, threatened against or affecting Borrower
or the Property in any court or before any Governmental Authority which if
adversely determined either individually or collectively has or is reasonably
likely to have a Material Adverse Effect.

      (p) Solvency; No Bankruptcy. Each of Borrower and, if applicable, the
General Partner, (i) is and has at all times been Solvent and will remain
Solvent immediately upon the consummation of the transactions contemplated by
the Loan Documents and (ii) is free from bankruptcy, reorganization or
arrangement proceedings or a general assignment for the benefit of creditors and
is not contemplating the filing of a petition under any state or federal
bankruptcy or insolvency laws or the liquidation of all or a major portion of
such Person's assets or property and Borrower has no knowledge of any Person
contemplating the filing of any such petition against it or, if applicable, the
General Partner. None of the transactions contemplated hereby

                                       35
<PAGE>

will be or have been made with an intent to hinder, delay or defraud any present
or future creditors of Borrower and Borrower has received reasonably equivalent
value in exchange for its obligations under the Loan Documents. Borrower's
assets do not, and immediately upon consummation of the transaction contemplated
in the Loan Documents will not, constitute unreasonably small capital to carry
out its business as presently conducted or as proposed to be conducted. Borrower
does not intend to, nor believes that it will, incur debts and liabilities
beyond its ability to pay such debts as they may mature.

      (q) Use of Proceeds. The proceeds of the Loan shall be applied by Borrower
to, inter alia, (i) acquire its interest in the Property and (ii) pay certain
transaction costs incurred by Borrower in connection with the Loan. No portion
of the proceeds of the Loan will be used for family, personal, agricultural or
household use.

      (r) Tax Filings. Borrower and, if applicable, each General Partner, have
filed all federal, state and local tax returns required to be filed and have
paid or made adequate provision for the payment of all federal, state and local
taxes, charges and assessments payable by Borrower and, if applicable, the
General Partners. Borrower and, if applicable, the General Partners, believe
that their respective tax returns properly reflect the income and taxes of
Borrower and said General Partner, if any, for the periods covered thereby,
subject only to reasonable adjustments required by the Internal Revenue Service
or other applicable tax authority upon audit.

      (s) Not Foreign Person. Borrower is not a "foreign person" within the
meaning of Section 1445(f)(3) of the Code.

      (t) ERISA. (i) The assets of Borrower and Guarantor are not and will not
become treated as "plan assets", whether by operation of law or under
regulations promulgated under ERISA. If any Person having a legal or beneficial
ownership interest in Borrower is using (or is deemed under ERISA to be using)
"plan assets", Borrower will qualify as a "real estate operating company" within
the meaning of 29 C.F.R. Section 2510.3-101(e) at all times that the Loan is
outstanding. Each Plan and Welfare Plan, and, to the knowledge of Borrower, each
Multiemployer Plan, is in compliance in all material respects with, and has been
administered in all material respects in compliance with, its terms and the
applicable provisions of ERISA, the Code and any other applicable Legal
Requirement, and no event or condition has occurred and is continuing as to
which Borrower would be under an obligation to furnish a report to Lender under
clause (ii)(A) of this Section. Other than an application for a favorable
determination letter with respect to a Plan, there are no pending issues or
claims before the Internal Revenue Service, the United States Department of
Labor or any court of competent jurisdiction related to any Plan or Welfare Plan
under which Borrower, Guarantor or any ERISA Affiliate, directly or indirectly
(through an indemnification agreement or otherwise), could be subject to any
material risk of liability under Section 409 or 502(i) of ERISA or Section 4975
of the Code. No Welfare Plan provides or will provide benefits, including,
without limitation, death or medical benefits (whether or not insured) with
respect to any current or former employee of Borrower, Guarantor or any ERISA
Affiliate beyond his or her retirement or other termination of service other
than

                                       36
<PAGE>

(A) coverage mandated by applicable law, (B) death or disability benefits that
have been fully provided for by fully paid up insurance or (C) severance
benefits.

            (ii) Borrower will furnish to Lender as soon as possible, and in any
      event within ten (10) days after Borrower knows or has reason to believe
      that any of the events or conditions specified below with respect to any
      Plan, Welfare Plan or Multiemployer Plan has occurred or exists, an
      Officer's Certificate setting forth details respecting such event or
      condition and the action, if any, that Borrower or its ERISA Affiliate
      proposes to take with respect thereto (and a copy of any report or notice
      required to be filed with or given to PBGC (or any other relevant
      Governmental Authority) by Borrower or an ERISA Affiliate with respect to
      such event or condition, if such report or notice is required to be filed
      with the PBGC or any other relevant Governmental Authority:

                  (A) any reportable event, as defined in Section 4043 of ERISA
            and the regulations issued thereunder, with respect to a Plan, as to
            which PBGC has not by regulation waived the requirement of Section
            4043(a) of ERISA that it be notified within thirty (30) days of the
            occurrence of such event (provided that a failure to meet the
            minimum funding standard of Section 412 of the Code and of Section
            302 of ERISA, including, without limitation, the failure to make on
            or before its due date a required installment under Section 412(m)
            of the Code and of Section 302(e) of ERISA, shall be a reportable
            event regardless of the issuance of any waivers in accordance with
            Section 412(d) of the Code), and any request for a waiver under
            Section 412(d) of the Code for any Plan;

                  (B) the distribution under Section 4041 of ERISA of a notice
            of intent to terminate any Plan or any action taken by Borrower or
            an ERISA Affiliate to terminate any Plan;

                  (C) the institution by PBGC of proceedings under Section 4042
            of ERISA for the termination of, or the appointment of a trustee to
            administer, any Plan, or the receipt by Borrower or any ERISA
            Affiliate of a notice from a Multiemployer Plan that such action has
            been taken by PBGC with respect to such Multiemployer Plan;

                  (D) the complete or partial withdrawal from a Multiemployer
            Plan by Borrower or any ERISA Affiliate that results in liability
            under Section 4201 or 4204 of ERISA (including the obligation to
            satisfy secondary liability as a result of a purchaser default) or
            the receipt by Borrower or any ERISA Affiliate of notice from a
            Multiemployer Plan that it is in reorganization or insolvency
            pursuant to Section 4241 or 4245 of ERISA or that it intends to
            terminate or has terminated under Section 4041A of ERISA;

                  (E) the institution of a proceeding by a fiduciary of any
            Multiemployer Plan against Borrower or any ERISA Affiliate to
            enforce Section 515 of ERISA, which proceeding is not dismissed
            within thirty (30) days;

                                       37
<PAGE>

                  (F) the adoption of an amendment to any Plan that, pursuant to
            Section 401(a)(29) of the Code or Section 307 of ERISA, would result
            in the loss of tax-exempt status of the trust of which such Plan is
            a part if Borrower or an ERISA Affiliate fails to timely provide
            security to the Plan in accordance with the provisions of said
            Sections; or

                  (G) the imposition of a lien or a security interest in
            connection with a Plan.

            (iii) Borrower shall not knowingly engage in or permit any
      transaction in connection with which Borrower, Guarantor or any ERISA
      Affiliate could be subject to either a civil penalty or tax assessed
      pursuant to Section 502(i) or 502(l) of ERISA or Section 4975 of the Code,
      permit any Welfare Plan to provide benefits, including without limitation,
      medical benefits (whether or not insured), with respect to any current or
      former employee of Borrower, Guarantor or any ERISA Affiliate beyond his
      or her retirement or other termination of service other than (A) coverage
      mandated by applicable law, (B) death or disability benefits that have
      been fully provided for by paid up insurance or otherwise or (C) severance
      benefits, permit the assets of Borrower or Guarantor to become "plan
      assets", whether by operation of law or under regulations promulgated
      under ERISA or adopt, amend (except as may be required by applicable law)
      or increase the amount of any benefit or amount payable under, or permit
      any ERISA Affiliate to adopt, amend (except as may be required by
      applicable law) or increase the amount of any benefit or amount payable
      under, any employee benefit plan (including, without limitation, any
      employee welfare benefit plan) or other plan, policy or arrangement,
      except for normal increases in the ordinary course of business consistent
      with past practice that, in the aggregate, do not result in a material
      increase in benefits expense to Borrower, Guarantor or any ERISA
      Affiliate.

      (u) Labor Matters. No organized work stoppage or labor strike is pending
or, to the best of Borrower's knowledge, threatened by employees or other
laborers at the Property and neither Borrower nor, to the best of Borrower's
knowledge, Manager (i) is involved in or threatened with any labor dispute,
grievance or litigation relating to labor matters involving any employees and
other laborers at the Property, including, without limitation, violation of any
federal, state or local labor, safety or employment laws (domestic or foreign)
and/or charges of unfair labor practices or discrimination complaints; (ii) has
engaged in any unfair labor practices within the meaning of the National Labor
Relations Act or the Railway Labor Act; or (iii) is a party to, or bound by, any
collective bargaining agreement or union contract with respect to employees and
other laborers at the Property and no such agreement or contract is currently
being negotiated by Borrower, Manager or any of their Affiliates.

      (v) Borrower's Legal Status. Borrower's exact legal name that is indicated
on the signature page hereto, organizational identification number and place of
business or, if more than one, its chief executive office, as well as Borrower's
mailing address, if different, which were identified by Borrower to Lender and
contained in this Security Instrument, are true, accurate and complete. Borrower
(i) will not change its name, its place of business or, if more than one

                                       38
<PAGE>

place of business, its chief executive office, or its mailing address or
organizational identification number if it has one without giving Lender at
least thirty (30) days prior written notice of such change, (ii) if Borrower
does not have an organizational identification number and later obtains one,
Borrower shall promptly notify Lender of such organizational identification
number and (iii) Borrower will not change its type of organization, jurisdiction
of organization or other legal structure.

      (w) Compliance with Anti-Terrorism, Embargo and Anti-Money Laundering
Laws. (i) None of Borrower, General Partner, any Guarantor, or any Person who
owns any equity interest in or Controls Borrower, General Partner or any
Guarantor currently is identified on the OFAC List or otherwise qualifies as a
Prohibited Person, and Borrower has implemented procedures, approved by General
Partner, to ensure that no Person who now or hereafter owns an equity interest
in Borrower or General Partner is a Prohibited Person or Controlled by a
Prohibited Person, (ii) no proceeds of the Loan will be used by Borrower,
General Partner, Guarantor or their respective Affiliates to fund any operations
in, finance any investments or activities in or make any payments to, Prohibited
Persons, and (iii) none of Borrower, General Partner, or any Guarantor are in
violation of any Legal Requirements relating to anti-money laundering or
anti-terrorism, including, without limitation, Legal Requirements related to
transacting business with Prohibited Persons or the requirements of the Uniting
and Strengthening America by Providing Appropriate Tools Required to Intercept
and Obstruct Terrorism Act of 2001, U.S. Public Law 107-56, and the related
regulations issued thereunder, including temporary regulations, all as amended
from time to time. No tenant under a Space Lease currently is identified on the
OFAC List or otherwise qualifies as a Prohibited Person, and, to the best of
Borrower's knowledge, no tenant at the Property is owned or Controlled by a
Prohibited Person. Borrower has determined that Manager has implemented
procedures, to the extent required by Legal Requirements, approved by Borrower,
to ensure that no tenant at the Property is a Prohibited Person or owned or
Controlled by a Prohibited Person.

      Section 2.03. Further Acts, etc. Borrower will, at the cost of Borrower,
and without expense to Lender, do, execute, acknowledge and deliver all and
every such further acts, deeds, conveyances, mortgages or deeds of trust, as
applicable, assignments, notices of assignments, transfers and assurances as
Lender shall, from time to time, reasonably require for the better assuring,
conveying, assigning, transferring, and confirming unto Lender the property and
rights hereby mortgaged, given, granted, bargained, sold, alienated, enfeoffed,
conveyed, confirmed, pledged, assigned and hypothecated, or which Borrower may
be or may hereafter become bound to convey or assign to Lender, or for carrying
out or facilitating the performance of the terms of this Security Instrument or
for filing, registering or recording this Security Instrument and, on demand,
will execute and deliver and hereby authorizes Lender to execute in the name of
Borrower or without the signature of Borrower to the extent Lender may lawfully
do so, one or more financing statements, chattel mortgages or comparable
security instruments to evidence more effectively the lien hereof upon the
Property. Borrower grants to Lender an irrevocable power of attorney coupled
with an interest for the purpose of protecting, perfecting, preserving and
realizing upon the interests granted pursuant to this Security Instrument and to
effect the intent hereof, all as fully and effectually as Borrower might or
could do; and Borrower hereby ratifies all that Lender shall lawfully do or
cause to be done by virtue hereof. Upon receipt of an

                                       39
<PAGE>

affidavit of an officer of Lender as to the loss, theft, destruction or
mutilation of the Note or any other Loan Document which is not of public record,
and, in the case of any such mutilation, upon surrender and cancellation of such
Note or other applicable Loan Document, Borrower will issue, in lieu thereof, a
replacement Note or other applicable Loan Document, dated the date of such lost,
stolen, destroyed or mutilated Note or other Loan Document in the same principal
amount thereof and otherwise of like tenor.

      Section 2.04. Recording of Security Instrument, etc. Borrower forthwith
upon the execution and delivery of this Security Instrument and thereafter, from
time to time, will cause this Security Instrument, and any security instrument
creating a lien or security interest or evidencing the lien hereof upon the
Property and each instrument of further assurance to be filed, registered or
recorded in such manner and in such places as may be required by any present or
future law in order to publish notice of and fully protect the lien or security
interest hereof upon, and the interest of Lender in, the Property. Borrower will
pay all filing, registration or recording fees, and all expenses incident to the
preparation, execution and acknowledgment of this Security Instrument, any
mortgage or deed of trust, as applicable, supplemental hereto, any security
instrument with respect to the Property and any instrument of further assurance,
and all federal, state, county and municipal, taxes, duties, imposts,
assessments and charges arising out of or in connection with the execution and
delivery of this Security Instrument, any mortgage or deed of trust, as
applicable, supplemental hereto, any security instrument with respect to the
Property or any instrument of further assurance, except where prohibited by law
to do so, in which event Lender may declare the Debt to be immediately due and
payable. Borrower shall hold harmless and indemnify Lender and its successors
and assigns, against any liability incurred as a result of the imposition of any
tax on the making and recording of this Security Instrument.

      Section 2.05. Representations, Warranties and Covenants Relating to the
Property. Borrower represents and warrants to and covenants with Lender with
respect to the Property as follows:

      (a) Lien Priority. This Security Instrument is a valid and enforceable
first lien on the Property, free and clear of all encumbrances and liens having
priority over the lien of this Security Instrument, except for the items set
forth as exceptions to or subordinate matters in the title insurance policy
insuring the lien of this Security Instrument, none of which, individually or in
the aggregate, materially interfere with the benefits of the security intended
to be provided by this Security Instrument, materially affect the value or
marketability of the Property, impair the use or operation of the Property for
the use currently being made thereof or impair Borrower's ability to pay its
obligations in a timely manner (such items being the "Permitted Encumbrances").

      (b) Title. Borrower has, subject only to the Permitted Encumbrances, good,
insurable and marketable fee simple title to the Premises, Improvements and
Fixtures (collectively, the "Realty") and to all easements and rights benefiting
the Realty and has the right, power and authority to mortgage, encumber, give,
grant, bargain, sell, alien, enfeoff, convey, confirm, pledge, assign, and
hypothecate the Property. Borrower will preserve its interest in and title to
the Property and will forever warrant and defend the same to Lender against any
and all claims

                                       40
<PAGE>

made by, through or under Borrower and will forever warrant and defend the
validity and priority of the lien and security interest created herein against
the claims of all Persons whomsoever claiming by, through or under Borrower. The
foregoing warranty of title shall survive the foreclosure of this Security
Instrument and shall inure to the benefit of and be enforceable by Lender in the
event Lender acquires title to the Property pursuant to any foreclosure. In
addition, there are no outstanding options or rights of first refusal to
purchase the Property or Borrower's ownership thereof, provided, however, the
Management Agreement which existed as of the Closing Date provides that Borrower
shall negotiate in good faith with Manager for the sale of the Property prior to
entering into a contract to sell the Property and identifies certain undesirable
transferees who may not become the "owner" under such Management Agreement,
which limitation shall not apply to a transfer by foreclosure of the lien of
this Security Instrument.

      (c) Taxes and Impositions. All taxes and other Impositions and
governmental assessments due and payable in respect of, and affecting, the
Property have been paid. Borrower has paid all Impositions which constitute
special governmental assessments in full, except for those assessments which are
permitted by applicable Legal Requirements to be paid in installments, in which
case all installments which are due and payable have been paid in full. There
are no pending, or to Borrower's best knowledge, proposed special or other
assessments for public improvements or otherwise affecting the Property, nor are
there any contemplated improvements to the Property that may result in such
special or other assessments.

      (d) Casualty; Flood Zone. To the best knowledge of Borrower, except as
disclosed in the engineering reports for the Property previously delivered to
Lender in connection with the origination of the Loan, the Realty is in good
repair and free and clear of any damage, destruction or casualty (whether or not
covered by insurance) that would materially affect the value of the Realty or
the use for which the Realty was intended, there exists no structural or other
material defects or damages in or to the Property and Borrower has not received
any written notice from any insurance company or bonding company of any material
defect or inadequacies in the Property, or any part thereof, which would
materially and adversely affect the insurability of the same or cause the
imposition of extraordinary premiums or charges thereon or of any termination or
threatened termination of any policy of insurance or bond. No portion of the
Premises is located in an "area of special flood hazard," as that term is
defined in the regulations of the Federal Insurance Administration, Department
of Housing and Urban Development, under the National Flood Insurance Act of
1968, as amended (24 CFR Section 1909.1) or Borrower has obtained the flood
insurance required by Section 3.01(a)(vi) hereof, if any. The Premises either
does not lie in a 100 year flood plain that has been identified by the Secretary
of Housing and Urban Development or any other Governmental Authority or, if it
does, Borrower has obtained the flood insurance required by Section 3.01(a)(vi)
hereof.

      (e) Completion; Encroachment. All Improvements necessary for the efficient
use and operation of the Premises have been completed and, except as set forth
in the title insurance policy insuring the lien of this Security Instrument or
the survey delivered to Lender in connection with the origination of the Loan,
none of said Improvements lie outside the boundaries and building restriction
lines of the Premises. Except as set forth in the title

                                       41
<PAGE>

insurance policy insuring the lien of this Security Instrument, no improvements
on adjoining properties encroach upon the Premises.

      (f) Separate Lot. The Premises are taxed separately without regard to any
other real estate and constitute a legally subdivided lot under all applicable
Legal Requirements (or, if not subdivided, no subdivision or platting of the
Premises is required under applicable Legal Requirements), and for all purposes
may be mortgaged, encumbered, conveyed or otherwise dealt with as an independent
parcel. The Property does not benefit from any tax abatement or exemption.

      (g) Use. The existence of all Improvements, the present use and operation
thereof and the access of the Premises and the Improvements to all of the
utilities and other items referred to in paragraph (k) below are, to the best of
Borrower's knowledge, in compliance in all material respects with all Leases
affecting the Property and all applicable Legal Requirements, including, without
limitation, Environmental Statutes, Development Laws and Use Requirements.
Except as previously disclosed to Lender in writing prior to the Closing Date,
Borrower has not received any notice from any Governmental Authority alleging
any uncured violation relating to the Property of any applicable Legal
Requirements. In the event that Borrower has received any notices from any
Governmental Authority alleging an uncured violation relating to the Property or
any applicable Legal Requirement, no such violation could have a Material
Adverse Effect.

      (h) Licenses and Permits. Borrower, Operating Tenant and/or Manager, on
behalf of Borrower and Operating Tenant currently holds and will continue to
hold all certificates of occupancy, licenses, registrations, permits, consents,
franchises and approvals of any Governmental Authority or any other Person which
are material for the lawful occupancy and operation of the Realty or which are
material to the ownership or operation of the Property or the conduct of
Borrower's business. All such certificates of occupancy, licenses,
registrations, permits, consents, franchises and approvals are current and in
full force and effect.

      (i) Environmental Matters. Borrower has received and reviewed the
Environmental Report and has no reason to believe that the Environmental Report
contains any untrue statement of a material fact or omits to state a material
fact necessary to make the statements contained therein or herein, in light of
the circumstances under which such statements were made, not misleading.

      (j) Property Proceedings. To the best of Borrower's knowledge, there are
no actions, suits or proceedings pending or threatened in any court or before
any Governmental Authority or arbitration board or tribunal (i) relating to (A)
the zoning of the Premises or any part thereof, (B) any certificates of
occupancy, licenses, registrations, permits, consents or approvals issued with
respect to the Property or any part thereof, (C) the condemnation of the
Property or any part thereof, or (D) the condemnation or relocation of any
roadways abutting the Premises required for access or the denial or limitation
of access to the Premises or any part thereof from any point of access to the
Premises, (ii) asserting that (A) any such zoning, certificates of occupancy,
licenses, registrations, permits, consents and/or approvals do not permit the
operation of any material portion of the Realty as presently being conducted,
(B) any material improvements

                                       42
<PAGE>

located on the Property or any part thereof cannot be located thereon or
operated with their intended use or (C) the operation of the Property or any
part thereof is in violation in any material respect of any Environmental
Statutes, Development Laws or other Legal Requirements or Space Leases or
Property Agreements or (iii) which might (A) affect the validity or priority of
any Loan Document or (B) have a Material Adverse Effect. Borrower is not aware
of any facts or circumstances which may give rise to any actions, suits or
proceedings described in the preceding sentence.

      (k) Utilities. The Premises has all necessary legal access to water, gas
and electrical supply, storm and sanitary sewerage facilities, other required
public utilities (with respect to each of the aforementioned items, by means of
either a direct connection to the source of such utilities or through
connections available on publicly dedicated roadways directly abutting the
Premises or through permanent insurable easements benefiting the Premises), fire
and police protection, parking, and means of direct access between the Premises
and public highways over recognized curb cuts (or such access to public highways
is through private roadways which may be used for ingress and egress pursuant to
permanent insurable easements).

      (l) Mechanics' Liens. The Property is free and clear of any mechanics'
liens or liens in the nature thereof, and no rights are outstanding that under
law could give rise to any such liens, any of which liens are or may be prior
to, or equal with, the lien of this Security Instrument, except those which are
insured against by the title insurance policy insuring the lien of this Security
Instrument.

      (m) Title Insurance. Lender has received a lender's title insurance policy
insuring this Security Instrument as a first lien on the Realty subject only to
Permitted Encumbrances.

      (n) Insurance. The Property is insured in accordance with the requirements
set forth in Article III hereof.

      (o) Space Leases.

            (i) To the best of Borrower's knowledge (after consultation with the
      Manager), Borrower has delivered a true, correct and complete Rent Roll
      for the Leases (the "Rent Roll") in a form approved by Lender.

            (ii) To the best of Borrower's knowledge, each Space Lease
      constitutes the legal, valid and binding obligation of Operating Tenant
      and, to the knowledge of Borrower, is enforceable against the tenant
      thereof. No default exists, or with the passing of time or the giving of
      notice would exist, (A) under any Major Space Lease or (B) under any other
      Space Leases which would, in the aggregate, have a Material Adverse
      Effect.

            (iii) To the best of Borrower's knowledge, no tenant under any Space
      Lease has, as of the date hereof, paid Rent more than thirty (30) days in
      advance, and the Rents under such Space Leases have not been waived,
      released, or otherwise discharged or compromised.

                                       43
<PAGE>

            (iv) To the best of Borrower's knowledge, all work to be performed
      by Borrower under the Space Leases has been substantially performed, all
      contributions to be made by Borrower to the tenants thereunder have been
      made except for any held-back amounts, and all other conditions precedent
      to each such tenant's obligations thereunder have been satisfied.

            (v) To the best of Borrower's knowledge, each tenant under a Space
      Lease or such tenant's authorized subtenant is currently occupying the
      space demised by such Space Lease.

            (vi) Borrower has delivered to Lender true, correct and complete
      copies of all Space Leases described in the Rent Roll.

            (vii) Each Space Lease is in full force and effect and (except as
      disclosed on the Rent Roll) has not been assigned, modified, supplemented
      or amended in any way.

            (viii) To the best of Borrower's knowledge, each tenant under each
      Space Lease is free from bankruptcy, reorganization or arrangement
      proceedings or a general assignment for the benefit of creditors.

            (ix) No Space Lease provides any party with the right to obtain a
      lien or encumbrance upon the Property superior to the lien of this
      Security Instrument.

      (p) Property Agreements.

            (i) Borrower has delivered to Lender true, correct and complete
      copies of all material Property Agreements.

            (ii) Except as set forth in the title insurance policy insuring the
      lien of this Security Instrument, no Property Agreement provides any party
      with the right to obtain a lien or encumbrance upon the Property superior
      to the lien of this Security Instrument.

            (iii) No default exists or with the passing of time or the giving of
      notice or both would exist under any Property Agreement which would,
      individually or in the aggregate, have a Material Adverse Effect.

            (iv) Borrower has not received or given any written communication
      which alleges that a default exists or, with the giving of notice or the
      lapse of time, or both, would exist under the provisions of any Property
      Agreement.

            (v) To the best knowledge of Borrower, no offset or any right of
      offset exists respecting continued contributions to be made by any party
      to any Property Agreement except as expressly set forth therein. Except as
      previously disclosed to Lender in writing, no material exclusions or
      restrictions on the utilization, leasing or improvement of the Property
      (including non-compete agreements) exists in any Property Agreement.

                                       44
<PAGE>

            (vi) To the best of Borrower's knowledge, all "pre-opening"
      requirements contained in all Property Agreements (including, but not
      limited to, all off-site and on-site construction requirements), if any,
      have been fulfilled, and, to the best of Borrower's knowledge, no
      condition now exists whereby any party to any such Property Agreement
      could refuse to honor its obligations thereunder.

            (vii) To the best of Borrower's knowledge, all work, if any, to be
      performed by Borrower under each of the Property Agreements has been
      substantially performed, all contributions to be made by Borrower to any
      party to such Property Agreements have been made, and all other conditions
      to such party's obligations thereunder have been satisfied.

      (q) Personal Property. Borrower and/or Operating Tenant have good and
marketable title to its interest in all personal property located upon the
Property or used in connection with the use or operation of the Realty other
than the property of Manager, tenants under Space Leases and hotel guests.

      (r) Leasing Brokerage and Management Fees. Except as previously disclosed
to Lender in writing, there are no brokerage fees or commissions payable by
Borrower with respect to the leasing of space at the Property and, except as set
forth in the Management Agreement, there are no management fees payable by
Borrower with respect to the management of the Property.

      (s) Security Deposits. Borrower is in compliance with all Legal
Requirements relating to such security deposits as to which failure to comply
might, individually or in the aggregate, have a Material Adverse Effect.

      (t) Lender's Appraisal. Borrower has no knowledge that any of the facts or
assumptions on which the appraisal delivered to Lender in connection with the
origination of the Loan was based are false or incomplete in any material
respect and has no information that such appraisal is incorrect.

      (u) Representations Generally. The representations and warranties
contained in this Security Instrument, and the review and inquiry made on behalf
of Borrower therefor, have all been made by Persons having the requisite
expertise and knowledge to provide such representations and warranties. No
representation, warranty or statement of fact made by or on behalf of Borrower
in this Security Instrument or in any certificate, document or schedule
furnished to Lender pursuant hereto, contains any untrue statement of a material
fact or omits to state any material fact necessary to make statements contained
therein or herein not misleading (which may be to Borrower's best knowledge
where so provided herein). There are no facts presently known to Borrower which
have not been disclosed to Lender which would, individually or in the aggregate,
have a Material Adverse Effect nor as far as Borrower can foresee might,
individually or in the aggregate, have a Material Adverse Effect.

                                       45
<PAGE>

      (v) Liquor License. All licenses, permits, approvals and consents which
are required for the sale and service of alcoholic beverages on the Premises
have been obtained from the applicable Governmental Authorities.

      (w) Membership and Club Agreements. Borrower has delivered to Lender (i) a
complete list of any of the material current club and membership agreements that
entitle a member thereunder to use the applicable portion of the Property
(together with all material amendments, replacements, supplements, modifications
and changes thereto, collectively, the "Membership Agreements"), for which true,
correct and complete copies of the form of each such Membership Agreement have
been delivered to Lender on or prior to the date hereof, (ii) a fair and
accurate summary in all material respects of how any membership deposits are
currently refundable to members under the Membership Agreement and (iii) a
complete list of any membership deposits that are held in the Membership Deposit
Account. Other than any membership deposits held in the Membership Deposit
Account, there are no other outstanding membership deposits that relate to the
Property. Borrower shall continue to hold in trust all of the membership
deposits in the Membership Deposit Account on a segregated basis and shall only
release amounts on deposit therein to members pursuant to the Membership
Agreement as and when such member is entitled to a refund of such deposit.
Borrower shall not commingle any amounts on deposit in the Membership Deposit
Account with any other funds of Borrower.

      (x) Membership Programs. Borrower shall not make any material
modifications to any existing membership program or similar program at the
Property or enter into any new membership or similar program at the Property to
the extent such modification or new program (i) would allow any member to redeem
a membership deposit prior to Borrower obtaining at least one new membership
deposit in an amount at least equal to the existing deposit to be redeemed
(i.e., a 1:1 redemption program) or (ii) could adversely affect the value of
Lender's security for the Loan. Borrower shall cause any membership deposits
which are not subject to a minimum 1:1 redemption program to be held in a
separate interest bearing account and if requested by Lender, shall, at its sole
cost and expense, promptly cause any such deposits to be held in an account
under the control of Lender. If Lender consents to any membership or similar
program that does not have a minimum 1:1 redemption method, Borrower agrees at
its sole cost and expense to promptly establish any reserves with Lender and
make any corresponding modifications to the Loan Documents as are reasonably
requested by Lender.

      Section 2.06. Removal of Lien. (a) Borrower shall, at its expense,
maintain this Security Instrument as a first lien on the Property and shall keep
the Property free and clear of all liens and encumbrances of any kind and nature
other than the Permitted Encumbrances. Borrower shall, within forty-five (45)
days following the filing thereof, promptly discharge of record, by bond or
otherwise, any such liens and, promptly upon request by Lender, shall deliver to
Lender evidence reasonably satisfactory to Lender of the discharge thereof.

      (b) Without limitation to the provisions of Section 2.06(a) hereof,
Borrower shall (i) pay or cause to be paid, from time to time when the same
shall become due, all claims and demands of mechanics, materialmen, laborers,
and others which, if unpaid, might result in, or permit the creation of, a lien
on the Property or any part thereof, (ii) cause to be removed of

                                       46
<PAGE>

record (by payment or posting of bond or settlement or otherwise) any
mechanics', materialmens', laborers' or other lien on the Property, or any part
thereof, or on the revenues, rents, issues, income or profit arising therefrom,
and (iii) in general, do or cause to be done, without expense to Lender,
everything reasonably necessary to preserve in full the lien of this Security
Instrument. If Borrower fails to comply with the requirements of this Section
2.06(b), then, upon five (5) Business Days' prior notice to Borrower, Lender
may, but shall not be obligated to, pay any such lien, and Borrower shall,
within five (5) Business Days after Lender's demand therefor, reimburse Lender
for all sums so expended, together with interest thereon at the Default Rate
from the date advanced, all of which shall be deemed part of the Debt. Nothing
contained herein shall be deemed a consent or request of Lender, express or
implied, by inference or otherwise, to the performance of any alteration, repair
or other work by any contractor, subcontractor or laborer or the furnishing of
any materials by any materialmen in connection therewith.

         (c) Notwithstanding the foregoing, Borrower may contest any lien (other
than a lien relating to non-payment of Impositions, the contest of which shall
be governed by Section 4.04 hereof) of the type set forth in subparagraph
(b)(ii) of this Section 2.06 provided that, following prior notice to Lender (i)
Borrower is contesting the validity of such lien with due diligence and in good
faith and by appropriate proceedings, without cost or expense to Lender or any
of its agents, employees, officers, or directors, (ii) Borrower shall preclude
the collection of, or other realization upon, any contested amount from the
Property or any revenues from or interest in the Property, (iii) neither the
Property nor any part thereof nor interest therein, shall be in any danger of
being sold, forfeited or lost by reason of such contest by Borrower, (iv) such
contest by Borrower shall not affect the ownership, use or occupancy of the
Property, (v) such contest by Borrower shall not subject Lender or Borrower to
the risk of civil or criminal liability (other than the civil liability of
Borrower for the amount of the lien in question), (vi) such lien is subordinate
to the lien of this Security Instrument, (vii) Borrower has not consented to
such lien, (viii) Borrower has given Lender prompt notice of the filing of such
lien and the bonding thereof by Borrower and, upon request by Lender from time
to time, notice of the status of such contest by Borrower and/or confirmation of
the continuing satisfaction of the conditions set forth in this Section 2.06(c),
(ix) Borrower shall promptly pay the obligation secured by such lien upon a
final determination of Borrower's liability therefor, and (x) Borrower shall
deliver to Lender cash, a bond or other security acceptable to Lender equal to
125% of the contested amount pursuant to collateral arrangements reasonably
satisfactory to Lender.

      Section 2.07. Cost of Defending and Upholding this Security Instrument
Lien. If any action or proceeding is commenced to which Lender is made a party
relating to the Loan Documents and/or the Property or Lender's interest therein
or in which it becomes necessary to defend or uphold the lien of this Security
Instrument or any other Loan Document, Borrower shall, on demand, reimburse
Lender for all expenses (including, without limitation, reasonable attorneys'
fees and disbursements) incurred by Lender in connection therewith, and such
sum, together with interest thereon at the Default Rate from and after such
demand until fully paid, shall constitute a part of the Debt.

                                       47
<PAGE>

      Section 2.08. Use of the Property. Borrower will use, or cause to be used,
the Property for such use as is permitted pursuant to applicable Legal
Requirements including, without limitation, under the certificate of occupancy
applicable to the Property, and which is required by the Loan Documents.
Borrower shall not suffer or permit the Property or any portion thereof to be
used by the public, any tenant, or any Person not subject to a Lease, in a
manner as is reasonably likely to impair Borrower's title to the Property, or in
such manner as may give rise to a claim or claims of adverse usage or adverse
possession by the public, or of implied dedication of the Property or any part
thereof.

      Section 2.09. Financial Reports. (a) Borrower will keep and maintain or
will cause to be kept and maintained on a Fiscal Year basis, in accordance with
GAAP and the Uniform System of Accounts, as applicable (or such other accounting
basis reasonably acceptable to Lender) consistently applied, proper and accurate
books, tax returns, records and accounts reflecting (i) all of the financial
affairs of Borrower and Guarantor and (ii) all items of income and expense in
connection with the operation of the Property or in connection with any
services, equipment or furnishings provided in connection with the operation
thereof, whether such income or expense may be realized by Borrower, Operating
Tenant or any Affiliate thereof. Lender shall have the right from time to time
at all times during normal business hours upon reasonable notice to examine such
books, tax returns, records and accounts at the office of Borrower or other
Person maintaining such books, tax returns, records and accounts and to make
such copies or extracts thereof as Lender shall desire. After the occurrence of
an Event of Default, Borrower shall pay any costs and expenses incurred by
Lender to examine Borrower's and Guarantor's accounting records with respect to
the Property, as Lender shall determine to be necessary or appropriate in the
protection of Lender's interest.

      (b) Borrower will furnish Lender (i) annually, within one hundred twenty
(120) days following the end of each Fiscal Year of Borrower and (ii) on a
quarterly basis, within forty-five (45) days following the end of each fiscal
quarter of Borrower, with a complete copy of Borrower's financial statement
consistently applied covering (i) all of the financial affairs of Borrower and
(ii) the operation of the Property for such Fiscal Year or fiscal quarters, as
applicable, and containing a statement of revenues and expenses, a statement of
assets and liabilities and a statement of Borrower's equity. Each annual
financial statement shall be audited by a nationally recognized Independent
certified public accountant that is acceptable to Lender in accordance with GAAP
(or such other

                                       48
<PAGE>

accounting basis reasonably acceptable to Lender) consistently applied;
provided, however, in lieu of delivering audited financial statements of
Borrower, Borrower may deliver annual financial statements of Borrower
consisting of a statement of revenues and expenses, a balance sheet and a
statement of Borrower's equity which are certified by Borrower as true, accurate
and complete, together with financial statements of the borrower under the Mez
Loan which are audited by a nationally recognized Independent certified public
accountant, provided that such audited financial statements set forth in
reasonable detail the revenues and expenses of Borrower. Together with the
financial statements required to be furnished pursuant to this Section 2.09(b),
Borrower shall furnish to Lender (A) an Officer's Certificate certifying as of
the date thereof (1) that the financial statements accurately represent the
results of operations and financial condition of Borrower and the Property all
in accordance with GAAP and the Uniform System of Accounts, as applicable (or
such other accounting basis reasonably acceptable to Lender) consistently
applied, and (2) whether there exists a Default under the Note or any other Loan
Document executed and delivered by Borrower and, if such event or circumstance
exists, the nature thereof, the period of time it has existed and the action
then being taken to remedy such event or circumstance, (B) together with the
financial statements delivered pursuant to Section 2.09(b)(ii) above, a
statement showing the calculation of the Debt Yield, (C) a management report, in
form and substance reasonably satisfactory to Lender, discussing the
reconciliation between such annual financial statements for each Fiscal Year and
the most recent Approved Annual Budget and (D) (1) Capital Expenditures
(including for this purpose any and all additions to, and replacements of,
furniture, fixtures and equipment) made in respect of the Property, including
separate line items with respect to any project costing in excess of $500,000,
(2) occupancy levels for the Property for such period and (3) average daily room
rates at the Property for such period.

      (c) Borrower will furnish, or cause to be furnished, to Lender on or
before the forty-fifth (45th) day after the end of each fiscal quarter of
Borrower (a) during an O&M Operative Period, a comparison of the budgeted income
and expenses and the actual income and expenses for such quarter for the
Property, together with a detailed explanation of any variances of five percent
(5%) or more between budgeted and actual amounts in the aggregate and on a
line-item basis for such period and year to date; provided, however, that
Borrower shall not be obligated to provide such detailed explanation for line
items the actual amounts for such quarter of which are less than $100,000, in
each case accompanied by an Officer's Certificate, certifying that to the best
of Borrower's Knowledge and the best of such officer's knowledge such items are
true, correct, accurate and complete and fairly present the financial condition
and results of the operations of Borrower and the Property in a manner
consistent with GAAP (subject to normal year end adjustments) to the extent
applicable and (b) a calculation of Debt Service Coverage for the trailing four
(4) fiscal quarters of Borrower.

      (d) At any time during which (i) Rent under Space Leases exceeds ten
percent (10%) of annual Operating Income, or (ii) an O&M Operative Period
exists, within fifteen (15) days after request by Lender, Borrower shall deliver
to Lender a true and complete rent roll for the Property, dated as of the last
month of such Fiscal Year, showing the percentage of gross leasable area of the
Property, if any, leased as of the last day of the preceding Fiscal Year, the
current annual rent for the Property, the expiration date of each Lease,
whether, to Borrower's knowledge, any portion of the Property has been sublet,
and if it has, the name of the subtenant, and such rent roll shall be
accompanied by an Officer's Certificate certifying that such rent roll is true,
correct and complete in all material respects as of its date and stating whether
Borrower, within the past year, has issued a notice of default with respect to
any Lease which has not been cured and the nature of such default.

      (e) Borrower shall furnish to Lender, within thirty (30) days after
Lender's request therefor, with such further detailed information with respect
to the operation of the Property and the financial affairs of Borrower as may be
reasonably requested by Lender.

      (f) Borrower and/or Operating Tenant shall cause Manager to keep and
maintain on a Fiscal Year basis, in accordance with GAAP and/or the Uniform
System of Accounts, as

                                       49
<PAGE>

applicable (or such other accounting basis reasonably acceptable to Lender)
consistently applied, proper and accurate books, records and accounts on an
accrual basis reflecting all items of income and expense in connection with the
operation of the Property or in connection with any services, equipment or
furnishings provided in connection with the operation thereof, whether such
income or expense may be realized by Manager or by any other Person whatsoever.
Lender shall have the right, to the extent permitted pursuant to the terms of
the Management Agreement, from time to time at all times during normal business
hours upon reasonable notice to examine such books, records and accounts at the
office of Manager or other Person maintaining such books, records and accounts
and to make such copies or extracts thereof as Lender shall desire. After the
occurrence of an Event of Default, Borrower shall pay any costs and expenses
incurred by Lender to examine Manager's accounting records with respect to the
Property, as Lender shall determine to be necessary or appropriate in the
protection of Lender's interest.

      (g) Borrower shall furnish to Lender monthly, within thirty (30) days
following the end of each calendar month, unaudited operating statements for the
Property and a report of average daily occupancy rates of the Property, in each
case accompanied by an Officer's Certificate certifying (i) with respect to the
operating statements, that, to the best of Borrower's knowledge and the best of
such officer's knowledge, such statements are true, correct, accurate and
complete and fairly present the results of the operations of Borrower and the
Property, (ii) with respect to the average daily occupancy rate reports, that
such item is, to the best of Borrower's knowledge and the best of such officer's
knowledge, true, correct and accurate and complete and fairly present the
results of the operations of Borrower and the Property, and (iii) during any O&M
Operative Period, a list of all deposits received in connection with any
Membership Agreements. Borrower shall also provide Lender with copies of all STR
Reports received by Borrower during the preceding month.

      (h) Intentionally Omitted.

      (i) Borrower shall submit to Lender an Annual Budget not later than
February 15 of each Fiscal Year or, with respect to the Fiscal Year in which the
Closing Date occurs, within thirty (30) days of the Closing Date. Subject to the
terms of the Management Agreement, at any time during the continuance of an
Event of Default of the type set forth in Section 13.01(a) or (b) or any other
material monetary Event of Default (collectively, "Material Monetary Events of
Default"), and during the continuance of an O&M Operative Period, Borrower shall
submit to Lender for Lender's written approval an Annual Budget not later than
February 15 of each Fiscal Year, in form satisfactory to Lender setting forth in
reasonable detail budgeted monthly operating income and monthly operating
capital and other expenses for the Property. In the event that Lender has the
right to approve the Annual Budget pursuant to the preceding sentence, (a) such
approval shall not be unreasonably withheld, and in the event that Lender
objects to the proposed Annual Budget submitted by Borrower, Lender shall advise
Borrower of such objections within fifteen (15) days after receipt thereof (and
deliver to Borrower a reasonably detailed description of such

                                       50
<PAGE>

objections) and Borrower shall, within three (3) days after receipt of notice of
any such objections, revise such Annual Budget and resubmit the same to Lender,
(b) Lender shall advise Borrower of any objections to such revised Annual Budget
within ten (10) days after receipt thereof (and deliver to Borrower a reasonably
detailed description of such objections) and Borrower shall revise the same in
accordance with the process described herein until Lender approves an Annual
Budget, provided, however, that if Lender shall not advise Borrower of its
objections to any proposed Annual Budget within the applicable time period set
forth in this Section, then such proposed Annual Budget shall be deemed approved
by Lender, (c) until such time that Lender approves a proposed Annual Budget,
the most recently Approved Annual Budget shall apply; provided that, such
Approved Annual Budget shall be adjusted to reflect actual increases in Basic
Carrying Costs and utilities expenses and to delete any non-recurring expenses
and (d) in the event that Borrower must incur an Extraordinary Expense, then
Borrower shall promptly deliver to Lender a reasonably detailed explanation of
such proposed Extraordinary Expense for Lender's approval, which approval may be
granted or denied in Lender's sole and absolute discretion.

      Section 2.10. Litigation. Borrower will give prompt written notice to
Lender of any litigation or governmental proceedings pending or threatened (in
writing) against Borrower which might have a Material Adverse Effect.

      Section 2.11. Updates of Representations. Borrower shall deliver to Lender
within ten (10) Business Days of the request of Lender an Officer's Certificate
updating all of the representations and warranties contained in this Security
Instrument and the other Loan Documents and certifying that all of the
representations and warranties contained in this Security Instrument and the
other Loan Documents, as updated pursuant to such Officer's Certificate, are
true, accurate and complete as of the date of such Officer's Certificate or
shall set forth the exceptions to representations and/or warranties in
reasonable detail, as applicable, and, upon Lender's request for further
information with respect to such exceptions, shall provide Lender such
additional information as Lender may reasonably request. Notwithstanding the
foregoing, provided that no Event of Default has occurred and is continuing,
Borrower shall not be required to deliver the foregoing Officer's Certificate
more than two (2) times during the term of the Loan.

                ARTICLE III: INSURANCE AND CASUALTY RESTORATION

      Section 3.01. Insurance Coverage. Borrower shall, at its expense, maintain
the following insurance coverages with respect to the Property during the term
of this Security Instrument:

      (a) (i) Insurance against loss or damage by fire, casualty and other
      hazards included in an "all-risk" policy or its equivalent (which, in the
      case of insurance during the time of any construction work being financed
      with the proceeds of the Loan ("Construction") shall be in "builder's risk
      completed value non-reporting form" together with rents, earnings and
      extra expense insurance covering loss due to delay in completion of the
      Improvements), with such endorsements as Lender may from time to time
      reasonably require and which are customarily required by Institutional
      Lenders of similar properties similarly situated, including, without
      limitation, if the Property constitutes a legal non-conforming use, an
      ordinance of law coverage endorsement which contains coverage for the (A)
      undamaged portion of the building, (B) demolition costs, and (C) increased
      cost of construction covering the Property in an amount not less than
      coverage (A) value included to full building limit and coverage and (B) a
      combined per occurrence

                                       51
<PAGE>

      limit of not less than $25,000,000. Not less frequently than once every
      three (3) years, Borrower, at its option, shall either (A) have the
      appraisal prepared for Lender in connection with the origination of the
      Loan updated or obtain a new appraisal of the Property, (B) have a
      valuation of the Property made by or for its insurance carrier conducted
      by an appraiser experienced in valuing properties of similar type to that
      of the Property which are in the geographical area in which the Property
      is located or (C) provide such other evidence as will, in Lender's sole
      judgment, enable Lender to determine whether there shall have been an
      increase in the insurable value of the Property and Borrower shall deliver
      such updated appraisal, new appraisal, insurance valuation or other
      evidence acceptable to Lender, as the case may be, and, if such updated
      appraisal, new appraisal, insurance valuation, or other evidence
      acceptable to Lender reflects an increase in the insurable value of the
      Property, the amount of insurance required hereunder shall be increased
      accordingly and Borrower shall deliver evidence satisfactory to Lender
      that such policy has been so increased.

            (ii) Commercial general liability insurance against claims for
      personal and bodily injury and/or death to one or more persons or property
      damage, occurring on, in or about the Property (including the adjoining
      streets, sidewalks and passageways therein) in such amounts as Lender may
      from time to time reasonably require (but in no event shall Lender's
      requirements be increased more frequently than once during each twelve
      (12) month period) and which are customarily required by Institutional
      Lenders for similar properties similarly situated, but not less than
      $1,000,000 per occurrence and $2,000,000 general aggregate on a per
      location basis and, in addition thereto, not less than $100,000,000 excess
      and/or umbrella liability insurance shall be maintained for any and all
      claims.

            (iii) Loss of rents insurance or business income insurance, as
      applicable, (A) with loss payable to Lender, (B) covering all risks
      required to be covered by the insurance provided for in Section 3.01(a)(i)
      hereof and (C) which provides that after the physical loss to the Property
      occurs, the loss of rents or income, as applicable, will be insured until
      such rents or income, as applicable, either return to the same level that
      existed prior to the loss, or the expiration of twelve (12) months,
      whichever first occurs, and notwithstanding that the policy may expire
      prior to the end of such period, and (D) which contains an extended period
      of indemnity endorsement which provided that after the physical loss to
      the Property has been repaired, the continued loss of income will be
      insured until such income either returns to the same level it was at prior
      to the loss, or the expiration of twelve (12) months from the date that
      such Property is repaired or replaced and operations are resumed,
      whichever first occurs, and notwithstanding that the policy may expire
      prior to the end of such period. The amount of such loss of rents or
      business income insurance, as applicable, shall be determined prior to the
      date hereof and at least once each year thereafter based of Borrower's
      reasonable estimate of the gross income less non-continuing expenses from
      the Property for the succeeding period of coverage required above as
      approved by Lender in its reasonable discretion. All proceeds payable to
      Lender pursuant to this subsection and shall be applied to the Debt,
      provided, however, that nothing herein contained shall be deemed to
      relieve Borrower of its obligations to

                                       52
<PAGE>

      pay the Debt when due except to the extent such amounts are actually paid
      our of the proceeds of such loss of rents or business income insurance, as
      applicable.

            (iv) Intentionally omitted.

            (v) Insurance against loss or damages from (A) leakage of sprinkler
      systems and (B) explosion of steam boilers, air conditioning equipment,
      pressure vessels or similar apparatus now or hereafter installed at the
      Property, in such amounts as Lender may from time to time reasonably
      require and which are then customarily required by Institutional Lenders
      of similar properties similarly situated, but in no event less than
      $25,000,000.

            (vi) Flood insurance in an amount equal to the full insurable value
      of the improvements located on the Property or the maximum amount
      available, whichever is less, if the Improvements are located in an area
      designated by the Secretary of Housing and Urban Development as being "an
      area of special flood hazard" under the National Flood Insurance Program
      (i.e., having a one percent or greater chance of flooding), and if flood
      insurance is available under the National Flood Insurance Act.

            (vii) Worker's compensation insurance or other similar insurance
      which may be required by Governmental Authorities or Legal Requirements.

            (viii) Insurance against loss resulting from mold, spores or fungus
      on or about the Premises, subject to availability at commercially
      reasonable rates and as agreed to by Borrower and/or its Manager and
      Lender.

            (ix) (A) During any period of the term of the Loan that the
      Terrorism Risk Insurance Act of 2002 ("TRIA") is in effect, if "acts of
      terrorism" or other similar acts or events are hereafter excluded from
      Borrower's comprehensive all risk insurance policy (including business
      interruption, rent loss or similar insurance coverage), Borrower shall
      obtain an endorsement to such policy, or a separate policy insuring
      against all "certified acts of terrorism" as defined by TRIA and "fire
      following", each in an amount equal to one hundred percent (100%) of the
      "Full Replacement Cost," which for purposes of this Security Instrument
      shall mean actual replacement value (exclusive of the Premises, footings
      and foundations) with a waiver of depreciation, provided, however, that in
      no event shall Borrower be obligated to carry insurance against "acts of
      terrorism" in an amount in excess of $500,000,000 per occurrence; and

                  (B) during any period of the term of the Loan that TRIA is not
      in effect, if "acts of terrorism" or other similar acts or events or "fire
      following" are hereafter excluded from Borrower's comprehensive all risk
      insurance policy or business interruption insurance coverage, Borrower
      shall obtain an endorsement to such policy, or a separate policy insuring
      against all such excluded acts or events, to the extent such policy or
      endorsement is available, in an amount determined by Lender in its sole
      discretion (but in no event greater than an amount in excess of
      $500,000,000 per occurrence, including required business interruption,
      rent loss or similar coverage);

                                       53
<PAGE>

      provided, however, Borrower shall not be required to pay annual premiums
      in excess of $1,500,000 for the insurance required under this clause (ix).

            (x) At all times during Construction, contractor's liability
      insurance to a limit of not less than $25,000,000 on a per occurrence
      basis covering each contractor's construction operation at the Premises.

            (xi) Such other insurance as may from time to time be required by
      Lender upon not less than sixty (60) days prior notice and which is then
      customarily required by Institutional Lenders for similar properties
      similarly situated as reasonably agreed to by Lender and Borrower, against
      other insurable hazards, including, but not limited to, malicious
      mischief, vandalism, sinkhole and mine subsidence, acts of terrorism,
      windstorm and/or earthquake, due regard to be given to the size and type
      of the Premises, Improvements, Fixtures and Equipment and their location,
      construction and use. Additionally, Borrower shall carry such insurance
      coverage as Lender may from time to time require if the failure to carry
      such insurance may result in a downgrade, qualification or withdrawal of
      any class of securities issued in connection with a Securitization or, if
      the Loan is not yet part of a Securitization, would result in an increase
      in the subordination levels of any class of securities anticipated to be
      issued in connection with a proposed Securitization.

            (ix) If Borrower, any of its Affiliates or Manager holds a liquor
license for the Premises, liquor liability insurance in the amount of no less
than $10,000,000.

            (x) Automobile liability insurance covering owned, hired and not
owned vehicles in an amount of not less than $1,000,000 per accident.

      (b) Borrower shall cause any Manager of the Property to maintain fidelity
insurance in an amount not less than $2,000,000 covering Manager's employees at
the Property or such lesser amount as Lender shall approve.

      Section 3.02. Policy Terms. (a) All insurance required by this Article III
shall be in the form (other than with respect to Sections 3.01(a)(vi) and (vii)
above when insurance in those two sub-sections is placed with a governmental
agency or instrumentality on such agency's forms) and amount and with
deductibles as, from time to time, shall be reasonably acceptable to Lender,
under valid and enforceable policies issued by financially responsible insurers
authorized to do business in the State where the Property is located and shall
have a claims paying ability rating and/or financial strength rating, as
applicable, of not less than "A" (or its equivalent), or such lower claims
paying ability rating and/or financial strength rating, as applicable, as Lender
shall, in its sole and absolute discretion, consent to, from a Rating Agency
(one of which after a Securitization in which Standard & Poor's rates any
securities issued in connection with such Securitization, shall be Standard &
Poor's) or by a syndicate of insurers through which at least 75% of the coverage
(if there are four (4) or fewer members of such syndicate) or at least 60% of
the coverage (if there are five (5) or more members of the syndicate) is with
carriers having claims-paying ability or financial strength ratings of "AA-" (or
its equivalent) from the Ratings Agencies, provided that all members of the
syndicate shall have claims-paying ability ratings

                                       54
<PAGE>

and/or financial strength ratings, as applicable, of not less than "A-" (or its
equivalent) from the Ratings Agencies. Originals or certified copies of all
insurance policies shall be delivered to and held by Lender. All such policies
(except policies for worker's compensation) shall name Lender, its successors
and/or assigns as an additional named insured, with respect to the insurance
required pursuant to Section 3.01(a)(iii) above, shall provide for loss payable
to Lender, its successors and/or assigns and shall contain (or have attached):
(i) standard "non-contributory mortgagee" endorsement or its equivalent
relating, inter alia, to recovery by Lender notwithstanding the negligent or
willful acts or omissions of Borrower; (ii) a waiver of subrogation endorsement
as to Lender; (iii) an endorsement indicating that neither Lender nor Borrower
shall be or be deemed to be a co-insurer with respect to any casualty risk
insured by such policies and shall provide for a deductible per loss of an
amount not more than $1,000,000 or with respect to (A) named storm windstorm
insurance and (B) flood insurance which is not made available under the National
Flood Insurance Act, no greater than 5% of the insurable value of the applicable
Cross-collateralized Property and (iv) a provision that such policies shall not
be canceled, terminated, denied renewal or amended, including, without
limitation, any amendment reducing the scope or limits of coverage, without at
least thirty (30) days' prior written notice to Lender in each instance. Not
less than thirty (30) days prior to the expiration dates of the insurance
policies obtained pursuant to this Security Instrument, originals or certified
copies of renewals of such policies (or certificates evidencing such renewals)
bearing notations evidencing the payment of premiums or accompanied by other
reasonable evidence of such payment (which premiums shall not be paid by
Borrower through or by any financing arrangement which would entitle an insurer
to terminate a policy; provided, however, if the insurance required by this
Security Instrument is affected by a blanket and/or umbrella policy which
complies with the provisions of Section 3.01(d) which covers not less than
twenty properties, Borrower may pay the premiums for such policies in four (4)
quarterly installments) shall be delivered by Borrower to Lender. Borrower shall
not carry separate insurance, concurrent in kind or form or contributing in the
event of loss, with any insurance required under this Article III.

      (b) If Borrower fails to maintain and deliver to Lender the original
policies or certificates of insurance required by this Security Instrument,
Lender may, at its option, procure such insurance, and Borrower shall pay, or as
the case may be, reimburse Lender for, all premiums thereon promptly, upon
demand by Lender, with interest thereon at the Default Rate from the date paid
by Lender to the date of repayment and such sum shall constitute a part of the
Debt.

      (c) Borrower and/or Manager shall notify Lender of the renewal premium of
each insurance policy and Lender shall be entitled to pay such amount on behalf
of Borrower.

      (d) The insurance required by this Security Instrument may, at the option
of Borrower and/or Manager, be effected by blanket and/or umbrella policies
issued to Borrower and/or Manager covering the Property provided that, in each
case, the policies otherwise comply with the provisions of this Security
Instrument and allocate to the Property, from time to time (but in no event less
than once a year), the coverage specified by this Security Instrument, without
possibility of reduction or coinsurance by reason of, or damage to, any other
property (real or

                                       55
<PAGE>

personal) named therein. If the insurance required by this Security Instrument
shall be effected by any such blanket or umbrella policies, Borrower and/or
Manager shall furnish to Lender (i) original policies or certified copies
thereof, or an original certificate of insurance together with reasonable access
to the original of such policy to review such policy's coverage of the Property,
with schedules attached thereto showing the amount of the insurance provided
under such policies applicable to the Property and (ii) an Officer's Certificate
setting forth (A) the number of properties covered by such policy, (B) the
location by city (if available, otherwise, county) and state of the properties,
(C) the average square footage of the properties, (D) a brief description of the
typical construction type included in the blanket policy and (E) such other
information as Lender may reasonably request.

      Section 3.03. Assignment of Policies. (a) Borrower hereby assigns to
Lender the proceeds of all insurance (other than worker's compensation and
liability insurance) obtained pursuant to this Security Instrument, all of which
proceeds shall be payable to Lender as collateral and further security for the
payment of the Debt and the performance of the Borrower's obligations hereunder
and under the other Loan Documents, and Borrower hereby authorizes and directs
the issuer of any such insurance to make payment of such proceeds directly to
Lender. Except as otherwise expressly provided in Section 3.04 or elsewhere in
this Article III, Lender shall have the option, in its discretion, and without
regard to the adequacy of its security, to apply all or any part of the proceeds
it may receive pursuant to this Article in such manner as Lender may elect to
any one or more of the following: (i) the payment of the Debt, whether or not
then due, in any proportion or priority as Lender, in its discretion, may elect,
(ii) the repair or restoration of the Property, (iii) the cure of any Default or
(iv) the reimbursement of the costs and expenses of Lender incurred pursuant to
the terms hereof in connection with the recovery of the Insurance Proceeds.
Nothing herein contained shall be deemed to excuse Borrower from repairing or
maintaining the Property as provided in this Security Instrument or restoring
all damage or destruction to the Property, regardless of the sufficiency of the
Insurance Proceeds, and the application or release by Lender of any Insurance
Proceeds shall not cure or waive any Default or notice of Default.

      (b) In the event of the foreclosure of this Security Instrument or any
other transfer of title or assignment of all or any part of the Property in
extinguishment, in whole or in part, of the Debt, all right, title and interest
of Borrower in and to all policies of insurance required by this Security
Instrument shall inure to the benefit of the successor in interest to Borrower
or the purchaser of the Property. If, prior to the receipt by Lender of any
proceeds, the Property or any portion thereof shall have been sold on
foreclosure of this Security Instrument or by deed in lieu thereof or otherwise,
or any claim under such insurance policy arising during the term of this
Security Instrument is not paid until after the extinguishment of the Debt, and
Lender shall not have received the entire amount of the Debt outstanding at the
time of such extinguishment, whether or not a deficiency judgment on this
Security Instrument shall have been sought or recovered or denied, then, the
proceeds of any such insurance to the extent of the amount of the Debt not so
received, shall be paid to and be the property of Lender, together with interest
thereon at the Default Rate, and the reasonable attorney's fees, costs and
disbursements incurred by Lender in connection with the collection of the
proceeds which shall be paid to Lender and Borrower hereby assigns, transfers
and sets over to Lender all of Borrower's right, title and

                                       56
<PAGE>

interest in and to such proceeds. Notwithstanding any provisions of this
Security Instrument to the contrary, Lender shall not be deemed to be a trustee
or other fiduciary with respect to its receipt of any such proceeds, which may
be commingled with any other monies of Lender; provided, however, that Lender
shall use such proceeds for the purposes and in the manner permitted by this
Security Instrument. Any proceeds deposited with Lender shall be held by Lender
in an interest-bearing account, but Lender makes no representation or warranty
as to the rate or amount of interest, if any, which may accrue on such deposit
and shall have no liability in connection therewith. Interest accrued, if any,
on the proceeds shall be deemed to constitute a part of the proceeds for
purposes of this Security Instrument. The provisions of this Section 3.03(b)
shall survive the termination of this Security Instrument by foreclosure, deed
in lieu thereof or otherwise as a consequence of the exercise of the rights and
remedies of Lender hereunder after a Default.

      Section 3.04. Casualty Restoration. (a) (i) In the event of any damage to
or destruction of the Property, Borrower shall give prompt written notice to
Lender (which notice shall set forth Borrower's good faith estimate of the cost
of repairing or restoring such damage or destruction, or if Borrower cannot
reasonably estimate the anticipated cost of restoration, Borrower shall
nonetheless give Lender prompt notice of the occurrence of such damage or
destruction, and will diligently proceed to obtain estimates to enable Borrower
to quantify the anticipated cost and time required for such restoration,
whereupon Borrower shall promptly notify Lender of such good faith estimate)
and, provided that restoration does not violate any Legal Requirements, Borrower
shall promptly commence and diligently prosecute to completion the repair,
restoration or rebuilding of the Property so damaged or destroyed to a condition
such that the Property shall be at least equal in value to that immediately
prior to the damage to the extent practicable, in full compliance with all Legal
Requirements and the provisions of all Leases, and in accordance with Section
3.04(b) below. Such repair, restoration or rebuilding of the Property are
sometimes hereinafter collectively referred to as the "Work".

            (ii) Borrower shall not adjust, compromise or settle any claim for
      Insurance Proceeds without the prior written consent of Lender, which
      shall not be unreasonably withheld or delayed and Lender shall have the
      right, at Borrower's sole cost and expense, to participate in any
      settlement or adjustment of Insurance Proceeds; provided, however, that,
      except during the continuance of an Event of Default, Lender's consent
      shall not be required with respect to the adjustment, compromising or
      settlement of any claim for Insurance Proceeds in an amount less than
      $1,000,000.

            (iii) Subject to Section 3.04(a)(iv), Lender shall apply any
      Insurance Proceeds which it may receive towards the Work in accordance
      with Section 3.04(b) and the other applicable sections of this Article
      III.

            (iv) If (A) a Default shall have occurred, (B) Lender is not
      reasonably satisfied that the Debt Yield, after substantial completion of
      the Work, will be at least equal to 8.25%, (C) more than thirty percent
      (30%) of the reasonably estimated fair market value of the Property is
      damaged or destroyed, (D) Lender is not reasonably satisfied that the Work
      can be completed six (6) months prior to Maturity or (E) Lender is not
      reasonably

                                       57
<PAGE>

      satisfied that the Work can be completed within ten (10) months of the
      damage to or destruction of the Property unless Borrower has delivered to
      Lender cash collateral in the amount estimated by Lender to be equal to
      (1) one-twelfth of the amount of the insurance coverage required by clause
      (iii) of Section 3.01(a) multiplied by (2) the number of months in excess
      of ten (10) which Lender reasonably believes will be required to complete
      the Work (each, a "Substantial Casualty"), Lender shall have the option,
      in its sole discretion to apply any Insurance Proceeds it may receive
      pursuant to this Security Instrument (less any cost to Lender of
      recovering and paying out such proceeds incurred pursuant to the terms
      hereof and not otherwise reimbursed to Lender, including, without
      limitation, reasonable attorneys' fees and expenses) to the payment of the
      Debt, without any prepayment fee or charge of any kind, or to allow such
      proceeds to be used for the Work pursuant to the terms and subject to the
      conditions of Section 3.04(b) hereof and the other applicable sections of
      this Article III. If Lender elects to apply any Insurance Proceeds it may
      receive pursuant to this Security Instrument to the payment of the Debt,
      Borrower may prepay the balance of the Release Price with respect to the
      Cross-collateralized Property which is subject to such Substantial
      Casualty, in accordance with Section 15.02, without any prepayment fee or
      charge of any kind.

            (v) In the event that Lender elects or is obligated hereunder to
      allow Insurance Proceeds to be used for the Work, any excess proceeds
      remaining after completion of such Work shall be applied to the payment of
      the Debt without any prepayment fee or charge of any kind.

      (b) If any Condemnation Proceeds in accordance with Section 6.01(a), or
any Insurance Proceeds in accordance with Section 3.04(a), are to be applied to
the repair, restoration or rebuilding of the Property, then such proceeds shall
be deposited into a segregated interest-bearing bank account at the Bank, which
shall be an Eligible Account, held by Lender and shall be paid out from time to
time to Borrower as the Work progresses (less any cost to Lender of recovering
and paying out such proceeds, including, without limitation, reasonable
attorneys' fees and costs allocable to inspecting the Work and the plans and
specifications therefor) subject to Section 5.13 hereof and to all of the
following conditions:

            (i) An Independent architect or engineer selected by Borrower and
      reasonably acceptable to Lender (an "Architect" or "Engineer") or a Person
      otherwise reasonably acceptable to Lender, shall have delivered to Lender
      a certificate estimating the cost of completing the Work, and, if the
      amount set forth therein is more than the sum of the amount of Insurance
      Proceeds then being held by Lender in connection with a casualty and
      amounts agreed to be paid as part of a final settlement under the
      insurance policy upon or before completion of the Work, Borrower shall
      have delivered to Lender (A) cash collateral in an amount equal to such
      excess, (B) an unconditional, irrevocable, clean sight draft letter of
      credit, in form, substance and issued by a bank reasonably acceptable to
      Lender, in the amount of such excess and draws on such letter of credit
      shall be made by Lender to make payments pursuant to this Article III
      following exhaustion of the Insurance Proceeds therefor or (C) a
      completion bond in form, substance and issued by a surety company
      reasonably acceptable to Lender.

                                       58
<PAGE>

            (ii) If the cost of the Work is reasonably estimated by an Architect
      or Engineer in a certification reasonably acceptable to Lender to be equal
      to or exceed five percent (5%) of the Allocated Loan Amount, such Work
      shall be performed under the supervision of an Architect or Engineer, it
      being understood that the plans and specifications with respect thereto
      shall provide for Work so that, upon completion thereof, the Property
      shall be at least equal in replacement value and general utility to the
      Property prior to the damage or destruction.

            (iii) Each request for payment shall be made on not less than ten
      (10) days' prior notice to Lender and shall be accompanied by a
      certificate of an Architect or Engineer, or, if the Work is not required
      to be supervised by an Architect or Engineer, by an Officer's Certificate
      stating (A) that payment is for Work completed in compliance with the
      plans and specifications, if required under clause (ii) above, (B) that
      the sum requested is required to reimburse Borrower for payments by
      Borrower to date, or is due to the contractors, subcontractors,
      materialmen, laborers, engineers, architects or other Persons rendering
      services or materials for the Work (giving a brief description of such
      services and materials), and that when added to all sums previously paid
      out by Lender does not exceed the value of the Work done to the date of
      such certificate, (C) if the sum requested is to cover payment relating to
      repair and restoration of personal property required or relating to the
      Property, that title to the personal property items covered by the request
      for payment is vested in Borrower (unless Borrower is lessee of such
      personal property), and (D) that the Insurance Proceeds and other amounts
      deposited by Borrower held by Lender after such payment is more than the
      estimated remaining cost to complete such Work; provided, however, that if
      such certificate is given by an Architect or Engineer, such Architect or
      Engineer shall certify as to clause (A) above, and such Officer's
      Certificate shall certify as to the remaining clauses above, and provided,
      further, that Lender shall not be obligated to disburse such funds if
      Lender determines, in Lender's reasonable discretion, that Borrower shall
      not be in compliance with this Section 3.04(b). Additionally, each request
      for payment shall contain a statement signed by Borrower stating that the
      requested payment is for Work satisfactorily done to date.

            (iv) Each request for payment shall be accompanied by waivers of
      lien, in customary form and substance, covering that part of the Work for
      which payment or reimbursement is being requested and, if required by
      Lender, a search prepared by a title company or licensed abstractor, or by
      other evidence reasonably satisfactory to Lender that there has not been
      filed with respect to the Property any mechanic's or other lien or
      instrument for retention of title relating to any part of the Work not
      discharged of record. Additionally, as to any personal property covered by
      the request for payment, Lender shall be furnished with evidence of
      Borrower having incurred a payment obligation therefor and such further
      evidence reasonably satisfactory to assure Lender that UCC filings
      therefor provide a valid first lien on the personal property.

            (v) Lender shall have the right to inspect the Work at all
      reasonable times upon reasonable prior notice and may condition any
      disbursement of Insurance Proceeds upon satisfactory compliance by
      Borrower with the provisions hereof. Neither the

                                       59
<PAGE>

      approval by Lender of any required plans and specifications for the Work
      nor the inspection by Lender of the Work shall make Lender responsible for
      the preparation of such plans and specifications, or the compliance of
      such plans and specifications of the Work, with any applicable law,
      regulation, ordinance, covenant or agreement.

            (vi) Insurance Proceeds shall not be disbursed more frequently than
      once every thirty (30) days.

            (vii) Until such time as the Work has been substantially completed,
      Lender shall not be obligated to disburse to Borrower an amount (the
      "Retention Amount") up to (A) until fifty percent (50%) of the Work has
      been completed (as reasonably determined by Lender), ten percent (10%) of
      the cost of the Work and (B) after fifty percent (50%) of the Work has
      been completed (as reasonably determined by Lender), five percent (5%) of
      the cost of the Work. Upon substantial completion of the Work, Borrower
      shall send notice thereof to Lender and, subject to the conditions of
      Section 3.04(b)(i)-(iv), Lender shall disburse one-half of the Retention
      Amount to Borrower; provided, however, that the remaining one-half of the
      Retention Amount shall be disbursed to Borrower when Lender shall have
      received copies of any and all final certificates of occupancy or other
      certificates, licenses and permits required for the ownership, occupancy
      and operation of the Property in accordance with all Legal Requirements.
      Borrower hereby covenants to diligently seek to obtain any such
      certificates, licenses and permits.

            (viii) Upon failure on the part of Borrower promptly to commence the
      Work or to proceed diligently and continuously to completion of the Work,
      which failure shall continue after notice for thirty (30) days, Lender may
      apply any Insurance Proceeds or Condemnation Proceeds it then or
      thereafter holds to the payment of the Debt in accordance with the
      provisions of the Note; provided, however, that Lender shall be entitled
      to apply at any time all or any portion of the Insurance Proceeds or
      Condemnation Proceeds it then holds to the extent necessary to cure any
      Event of Default.

      (c) If Borrower (i) within ninety (90) days after the occurrence of any
damage to the Property or any portion thereof (or such shorter period as may be
required under any Major Space Lease) shall fail to submit to Lender for
approval plans and specifications for the Work (approved by the Architect and by
all Governmental Authorities whose approval is required), (ii) after any such
plans and specifications are approved by all Governmental Authorities, the
Architect and Lender, shall fail to promptly commence such Work or (iii) shall
fail to diligently prosecute such Work to completion, then, in addition to all
other rights available hereunder, at law or in equity, Lender, or any receiver
of the Property or any portion thereof, upon five (5) days' prior notice to
Borrower (except in the event of emergency in which case no notice shall be
required), may (but shall have no obligation to) perform or cause to be
performed such Work, and may take such other steps as it reasonably deems
advisable. Borrower hereby waives, for Borrower, any claim, other than for gross
negligence or willful misconduct, against Lender and any receiver arising out of
any act or omission of Lender or such receiver pursuant hereto, and Lender may
apply all or any portion of the Insurance Proceeds (without the need to fulfill
any

                                       60
<PAGE>

other requirements of this Section 3.04) to reimburse Lender and such receiver,
for all costs not reimbursed to Lender or such receiver upon demand together
with interest thereon at the Default Rate from the date such amounts are
advanced until the same are paid to Lender or the receiver.

      (d) Borrower hereby irrevocably appoints Lender as its attorney-in-fact,
coupled with an interest, to collect and receive any Insurance Proceeds paid
with respect to any portion of the Property or the insurance policies required
to be maintained hereunder, and to endorse any checks, drafts or other
instruments representing any Insurance Proceeds whether payable by reason of
loss thereunder or otherwise.

      Section 3.05. Compliance with Insurance Requirements. Borrower promptly
shall comply with, and shall cause the Property to comply with, all Insurance
Requirements, even if such compliance requires structural changes or
improvements or would result in interference with the use or enjoyment of the
Property or any portion thereof provided Borrower shall have a right to contest
in good faith and with diligence such Insurance Requirements provided (a) no
Event of Default shall exist during such contest and such contest shall not
subject the Property or any portion thereof to any lien or affect the priority
of the lien of this Security Instrument, (b) failure to comply with such
Insurance Requirements will not subject Lender or any of its agents, employees,
officers or directors to any civil or criminal liability, (c) such contest will
not cause any reduction in insurance coverage, (d) such contest shall not affect
the ownership, use or occupancy of the Property, (e) the Property or any part
thereof or any interest therein shall not be in any danger of being sold,
forfeited or lost by reason of such contest by Borrower, (f) Borrower has given
Lender prompt notice of such contest and, upon request by Lender from time to
time, notice of the status of such contest by Borrower and/or information of the
continuing satisfaction of the conditions set forth in clauses (a) through (e)
of this Section 3.05, (g) upon a final determination of such contest, Borrower
shall promptly comply with the requirements thereof, and (h) prior to and during
such contest, Borrower shall furnish to Lender security satisfactory to Lender,
in its reasonable discretion, against loss or injury by reason of such contest
or the non-compliance with such Insurance Requirement (and if such security is
cash, Lender shall deposit the same in an interest-bearing account and interest
accrued thereon, if any, shall be deemed to constitute a part of such security
for purposes of this Security Instrument, but Lender (i) makes no representation
or warranty as to the rate or amount of interest, if any, which may accrue
thereon and shall have no liability in connection therewith and (ii) shall not
be deemed to be a trustee or fiduciary with respect to its receipt of any such
security and any such security may be commingled with other monies of Lender).
If Borrower shall use the Property or any portion thereof in any manner which
could permit the insurer to cancel any insurance required to be provided
hereunder, Borrower immediately shall obtain a substitute policy which shall
satisfy the requirements of this Security Instrument and which shall be
effective on or prior to the date on which any such other insurance policy shall
be canceled. Borrower shall not by any action or omission invalidate any
insurance policy required to be carried hereunder unless such policy is replaced
as aforesaid, or materially increase the premiums on any such policy above the
normal premium charged for such policy. Borrower shall cooperate with Lender in
obtaining for Lender the benefits of any Insurance Proceeds lawfully or
equitably payable to Lender in connection with the transaction contemplated
hereby.

                                       61
<PAGE>

      Section 3.06. Event of Default During Restoration. Notwithstanding
anything to the contrary contained in this Security Instrument including,
without limitation, the provisions of this Article III, if, at the time of any
casualty affecting the Property or any part thereof, or at any time during any
Work, or at any time that Lender is holding or is entitled to receive any
Insurance Proceeds pursuant to this Security Instrument, a Default exists and is
continuing (whether or not it constitutes an Event of Default), Lender shall
then have no obligation to make such proceeds available for Work and Lender
shall have the right and option, to be exercised in its sole and absolute
discretion and election, with respect to the Insurance Proceeds, either to
retain and apply such proceeds in reimbursement for the actual costs, fees and
expenses incurred by Lender in accordance with the terms hereof in connection
with the adjustment of the loss and, after the occurrence of an Event of
Default, any balance toward payment of the Debt in such priority and proportions
as Lender, in its sole discretion, shall deem proper, or towards the Work, upon
such terms and conditions as Lender shall determine, or to cure such Event of
Default, or to any one or more of the foregoing as Lender, in its sole and
absolute discretion, may determine. If Lender shall receive and retain such
Insurance Proceeds, the lien of this Security Instrument shall be reduced only
by the amount thereof received, after reimbursement to Lender of expenses of
collection, and actually applied by Lender in reduction of the principal sum
payable under the Note in accordance with the Note.

      Section 3.07. Application of Proceeds to Debt Reduction. (a) No damage to
the Property, or any part thereof, by fire or other casualty whatsoever, whether
such damage be partial or total, shall relieve Borrower from its liability to
pay in full the Debt and to perform its obligations under this Security
Instrument and the other Loan Documents.

      (b) If any Insurance Proceeds are applied to reduce the Debt, Lender shall
apply the same in accordance with the provisions of the Note.

                            ARTICLE IV: IMPOSITIONS

      Section 4.01. Payment of Impositions, Utilities and Taxes, etc. (a)
Borrower shall pay or cause to be paid all Impositions at least five (5) days
prior to the date upon which any fine, penalty, interest or cost for nonpayment
is imposed, and furnish to Lender, upon request, receipted bills of the
appropriate taxing authority or other documentation reasonably satisfactory to
Lender evidencing the payment thereof. If Borrower shall fail to pay any
Imposition in accordance with this Section and is not contesting or causing a
contesting of such Imposition in accordance with Section 4.04 hereof, or if
there are insufficient funds in the Basic Carrying Costs Escrow Account to pay
any Imposition, Lender shall have the right, but shall not be obligated, to pay
that Imposition, and Borrower shall repay to Lender, on demand, any amount paid
by Lender, with interest thereon at the Default Rate from the date of the
advance thereof to the date of repayment, and such amount shall constitute a
portion of the Debt secured by this Security Instrument. Nothing contained in
this Security Instrument shall be construed to require Borrower to pay any tax,
assessment, levy or charge imposed on Lender in the nature of a franchise,
capital levy, estate, inheritance, succession, income or net revenue tax.

                                       62
<PAGE>

      (b) Borrower shall, prior to the date upon which any fine, penalty,
interest or cost for the nonpayment is imposed, pay or cause to be paid all
charges for electricity, power, gas, water and other services and utilities in
connection with the Property, and shall, upon request, deliver to Lender
receipts or other documentation reasonably satisfactory to Lender evidencing
payment thereof. If Borrower shall fail to pay any amount required to be paid by
Borrower pursuant to this Section 4.01 and is not contesting such charges in
accordance with Section 4.04 hereof, Lender shall have the right, but shall not
be obligated, to pay that amount, and Borrower will repay to Lender, on demand,
any amount paid by Lender with interest thereon at the Default Rate from the
date of the advance thereof to the date of repayment, and such amount shall
constitute a portion of the Debt secured by this Security Instrument.

      (c) Borrower shall pay all taxes, charges, filing, registration and
recording fees, excises and levies imposed upon Lender by reason of or in
connection with its ownership of any Loan Document or any other instrument
related thereto, or resulting from the execution, delivery and recording of, or
the lien created by, or the obligation evidenced by, any of them, other than
income, franchise and other similar taxes imposed on Lender and shall pay all
corporate stamp taxes, if any, and other taxes, required to be paid on the Loan
Documents. If Borrower shall fail to make any such payment within ten (10) days
after written notice thereof from Lender, Lender shall have the right, but shall
not be obligated, to pay the amount due, and Borrower shall reimburse Lender
therefor, on demand, with interest thereon at the Default Rate from the date of
the advance thereof to the date of repayment, and such amount shall constitute a
portion of the Debt secured by this Security Instrument.

      Section 4.02. Deduction from Value. In the event of the passage after the
date of this Security Instrument of any Legal Requirement deducting from the
value of the Property for the purpose of taxation, any lien thereon or changing
in any way the Legal Requirements now in force for the taxation of this Security
Instrument and/or the Debt for federal, state or local purposes, or the manner
of the operation of any such taxes so as to adversely affect the interest of
Lender, or imposing any tax or other charge on any Loan Document, then Borrower
will pay such tax, with interest and penalties thereon, if any, within the
statutory period. In the event the payment of such tax or interest and penalties
by Borrower would be unlawful, or taxable to Lender or unenforceable or provide
the basis for a defense of usury, then in any such event, Lender shall have the
option, by written notice of not less than thirty (30) days, to declare the Debt
immediately due and payable, with no prepayment fee or charge of any kind.

      Section 4.03. No Joint Assessment. Borrower shall not consent to or
initiate the joint assessment of the Premises or the Improvements (a) with any
other real property constituting a separate tax lot and Borrower represents and
covenants that the Premises and the Improvements are and shall remain a separate
tax lot or (b) with any portion of the Property which may be deemed to
constitute personal property, or any other procedure whereby the lien of any
taxes which may be levied against such personal property shall be assessed or
levied or charged to the Property as a single lien.

      Section 4.04. Right to Contest. Borrower shall have the right, after prior
notice to Lender, at its sole expense, to contest by appropriate legal
proceedings diligently conducted in

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good faith, without cost or expense to Lender or any of its agents, employees,
officers or directors, the validity, amount or application of any Imposition or
any charge described in Section 4.01(b), provided that (a) no Default or Event
of Default shall exist during such proceedings and such contest shall not
(unless Borrower shall comply with clause (d) of this Section 4.04) subject the
Property or any portion thereof to any lien or affect the priority of the lien
of this Security Instrument, (b) failure to pay such Imposition or charge will
not subject Lender or any of its agents, employees, officers or directors to any
civil or criminal liability, (c) the contest suspends enforcement of the
Imposition or charge (unless Borrower first pays the Imposition or charge), (d)
prior to and during such contest, Borrower shall furnish to Lender security
satisfactory to Lender, in its reasonable discretion, against loss or injury by
reason of such contest or the non-payment of such Imposition or charge (and if
such security is cash, Lender may deposit the same in an interest-bearing
account and interest accrued thereon, if any, shall be deemed to constitute a
part of such security for purposes of this Security Instrument, but Lender (i)
makes no representation or warranty as to the rate or amount of interest, if
any, which may accrue thereon and shall have no liability in connection
therewith and (ii) shall not be deemed to be a trustee or fiduciary with respect
to its receipt of any such security and any such security may be commingled with
other monies of Lender), (e) such contest shall not affect the ownership, use or
occupancy of the Property, (f) the Property or any part thereof or any interest
therein shall not be in any danger of being sold, forfeited or lost by reason of
such contest by Borrower, (g) Borrower has given Lender notice of the
commencement of such contest and upon request by Lender, from time to time,
notice of the status of such contest by Borrower and/or confirmation of the
continuing satisfaction of clauses (a) through (f) of this Section 4.04, and (h)
upon a final determination of such contest, Borrower shall promptly comply with
the requirements thereof. Upon completion of any contest, Borrower shall
immediately pay the amount due, if any, and deliver to Lender proof of the
completion of the contest and payment of the amount due, if any, following which
Lender shall return the security, if any, deposited with Lender pursuant to
clause (d) of this Section 4.04. Borrower shall not pay any Imposition in
installments unless permitted by applicable Legal Requirements, and shall, upon
the request of Lender, deliver copies of all notices and bills relating to any
Imposition or other charge covered by this Article IV to Lender.

      Section 4.05. No Credits on Account of the Debt. Borrower will not claim
or demand or be entitled to any credit or credits on account of the Debt for any
part of the Impositions assessed against the Property or any part thereof and no
deduction shall otherwise be made or claimed from the taxable value of the
Property, or any part thereof, by reason of this Security Instrument or the
Debt. In the event such claim, credit or deduction shall be required by Legal
Requirements, Lender shall have the option, by written notice of not less than
thirty (30) days, to declare the Debt immediately due and payable, and Borrower
hereby agrees to pay such amounts not later than thirty (30) days after such
notice.

      Section 4.06. Documentary Stamps. If, at any time, the United States of
America, any State or Commonwealth thereof or any subdivision of any such State
shall require revenue or other stamps to be affixed to the Note, this Security
Instrument or any other Loan Document, or impose any other tax or charges on the
same, Borrower will pay the same, with interest and penalties thereon, if any.

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<PAGE>

                       ARTICLE V: CENTRAL CASH MANAGEMENT

      Section 5.01. Cash Flow. Borrower shall cause Manager to collect all
security deposits from tenants under valid Leases, which shall be held by
Manager, as agent for Borrower, in an account in accordance with applicable law
(the "Security Deposit Account"). Borrower shall notify Lender of any security
deposits in excess of $100,000 held as letters of credit and, upon Lender's
request, such letters of credit shall be promptly delivered to Lender. Borrower
shall have no right to withdraw funds from the Security Deposit Account;
provided that, prior to the occurrence of an Event of Default, funds may be
withdrawn from the Security Deposit Account to refund or apply security deposits
as required by the Leases or by applicable Legal Requirements. After the
occurrence of an Event of Default, all withdrawals in excess of $100,000 from
the Security Deposit Account must be approved by Lender. All payments
constituting Rent shall be delivered to Manager. Manager shall collect all Rent
and shall deposit in the Collection Account, the name and address of the bank in
which such account is located and the account number of which to be identified
in writing by Borrower to Lender, all Property Available Cash, or, if the
Management Agreement which exists as of the Closing Date is terminated and not
replaced with a management agreement approved by Lender with an Approved Manager
(an "Approved Replacement Management Agreement"), all Rent. Pursuant to the
Collection Account Agreement of even date herewith, the bank in which the
Collection Account is located has been instructed that all collected funds
deposited in the Collection Account shall be automatically transferred through
automated clearing house funds ("ACH") or by Federal wire to the Central Account
prior to 5:00 p.m. (New York City time) on a daily basis. Additionally, in the
event that an Approved Manager is not the Manager pursuant to the terms of the
Management Agreement which existed as of the Closing Date or an Approved
Replacement Management Agreement, Borrower shall, or shall cause Manager to send
to each respective credit card company or credit card clearing bank with which
Borrower or Manager has entered into merchant's agreements (each, a "Credit Card
Company") a direction letter in the form of EXHIBIT H annexed hereto and made a
part hereof (the "Credit Card Payment Direction Letter") directing such Credit
Card Company to make all payments due in connection with goods or services
furnished at or in connection with the Property by Federal wire or through ACH
directly to the Collection Account. Without the prior written consent of Lender,
neither Borrower nor Manager shall (i) terminate, amend, revoke or modify any
Credit Card Payment Direction Letter in any manner or (ii) direct or cause any
Credit Card Company to pay any amount in any manner other than as specifically
provided in the related Credit Card Payment Direction Letter. Lender may elect
to change the financial institution in which the Central Account shall be
maintained; however, Lender shall give Borrower and the bank in which the
Collection Account is located not fewer than five (5) Business Days' prior
notice of such change. Neither Borrower nor Manager shall change such bank or
the Collection Account without the prior written consent of Lender. All fees and
charges of the bank(s) in which the Collection Account and the Central Account
are located shall be paid by Borrower.

      Section 5.02. Establishment of Accounts. Lender has established the Escrow
Accounts and the Central Account in the name of Lender and the Collection
Account in the joint name of Borrower and Lender, as secured party. The Escrow
Accounts , the Collection Account and the Central Account shall be under the
sole dominion and control of Lender and funds held therein

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<PAGE>

shall not constitute trust funds. Borrower hereby irrevocably directs and
authorizes Lender to withdraw funds from the Collection Account, and to deposit
into and withdraw funds from the Central Account and the Escrow Accounts, all in
accordance with the terms and conditions of this Security Instrument. Borrower
shall have no right of withdrawal in respect of the Collection Account, the
Central Account or the Escrow Accounts except as specifically provided herein.
Each transfer of funds to be made hereunder shall be made only to the extent
that funds are on deposit in the Collection Account, the Central Account or the
affected Sub-Account or Escrow Account, and Lender shall have no responsibility
to make additional funds available in the event that funds on deposit are
insufficient. The Central Account shall contain the Basic Carrying Costs
Sub-Account, the Debt Service Payment Sub-Account, the Recurring Replacement
Reserve Sub-Account, the Operation and Maintenance Expense Sub-Account, the Mez
Payment Sub-Account and the Curtailment Reserve Sub-Account, each of which
accounts shall be Eligible Accounts or book-entry sub-accounts of an Eligible
Account (each a "Sub-Account" and collectively, the "Sub-Accounts") to which
certain funds shall be allocated and from which disbursements shall be made
pursuant to the terms of this Security Instrument. Sums held in the Escrow
Accounts may be commingled with other monies held by Lender.

      Section 5.03. Intentionally Omitted.

      Section 5.04. Servicing Fees. At the option of Lender, the Loan may be
serviced by a servicer (the "Servicer") selected by Lender and Lender may
delegate all or any portion of its responsibilities under this Security
Instrument to the Servicer. Borrower shall pay all reasonable servicing fees of
Servicer, if any, charged in connection with any disbursement of funds from the
Escrow Accounts and any fees charged in connection with obtaining consents from
Lender and fees charged in connection with Defaults and if the Loan becomes a
"specially serviced mortgage loan" pursuant to the documents executed in
connection with a Securitization, pursuant to the Servicer's then standard
conditions and rates.

      Section 5.05. Monthly Funding of Sub-Accounts and Escrow Accounts. (a) On
or before each Payment Date during the term of the Loan, commencing on the first
(1st) Payment Date occurring after the month in which the Loan is initially
funded, Borrower shall pay or cause to be paid to the Central Account all sums
required to be deposited in the Sub-Accounts relating to the Interest Accrual
Period commencing on such Payment Date, pursuant to clauses (i) through (viii)
of this Section 5.05(a) and all funds transferred or deposited into the Central
Account shall be allocated among the Sub-Accounts as follows and in the
following priority:

            (i) first, to the Basic Carrying Costs Sub-Account, until an amount
      equal to the Basic Carrying Costs Monthly Installment for such Interest
      Accrual Period has been allocated to the Basic Carrying Costs Sub-Account;

            (ii) second, to the Debt Service Payment Sub-Account, until an
      amount equal to the Required Debt Service Payment for the Payment Date
      occurring for such Interest Accrual Period has been allocated to the Debt
      Service Payment Sub-Account;

            (iii) third, to the Recurring Replacement Reserve Sub-Account, until
      an amount equal to the Recurring Replacement Reserve Monthly Installment
      for such

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<PAGE>

      Interest Accrual Period has been allocated to the Recurring Replacement
      Reserve Sub-Account;

            (iv) fourth, but only during any Default Management Period, to the
      Operation and Maintenance Expense Sub-Account in an amount equal to the
      Cash Expenses, other than management fees payable to Affiliates of
      Borrower, for such Interest Accrual Period pursuant to the related
      Approved Annual Budget unless Manager is obligated to and does pay such
      sums pursuant to the terms of the Management Agreement which existed as of
      the Closing Date or an Approved Replacement Management Agreement;

            (v) fifth, but only during any Default Management Period, to the
      Operation and Maintenance Expense Sub-Account in an amount equal to the
      amount, if any, of the Net Capital Expenditures for such Interest Accrual
      Period pursuant to the related Approved Annual Budget unless Manager is
      obligated to and does pay such sums pursuant to the terms of the
      Management Agreement which existed as of the Closing Date or an Approved
      Replacement Management Agreement;

            (vi) sixth, but only during any Default Management Period, to the
      Operation and Maintenance Expense Sub-Account in an amount equal to the
      amount, if any, of the Extraordinary Expenses approved by Lender for such
      Interest Accrual Period unless Manager is obligated to and does pay such
      sums pursuant to the terms of the Management Agreement which existed as of
      the Closing Date or an Approved Replacement Management Agreement;

            (vii) seventh, but only if an Event of Default is not then
      continuing, to the Mez Payment Sub-Account until an amount equal to the
      Mez Payment Amount has been allocated to the Mez Payment Sub-Account,
      provided, however, in the event there is not sufficient Property Available
      Cash and/or Rent to allocate all funds required to be allocated to the Mez
      Payment Sub-Account pursuant to this clause (vii), such failure shall not,
      in and of itself, constitute a Default; and

            (viii) eighth, but only during an O&M Operative Period, the balance,
      if any, to the Curtailment Reserve Sub-Account.

      Provided that no Event of Default has occurred and is continuing, Lender
agrees that in each Interest Accrual Period any amounts deposited into or
remaining in the Central Account after the Sub-Accounts have been funded in
accordance with clauses (i) through (viii) above with respect to such Interest
Accrual Period and any periods prior thereto, shall be disbursed by Lender to
Borrower on the Payment Date applicable to such Interest Accrual Period. The
balance of the funds distributed to Borrower after payment of all Operating
Expenses by or on behalf of Borrower may be retained by Borrower. .

      (b) On each Payment Date, (i) sums held in the Basic Carrying Costs
Sub-Account shall be transferred to the Basic Carrying Costs Escrow Account,
(ii) sums held in the Debt Service Payment Sub-Account, together with any
amounts deposited into the Central

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<PAGE>

Account that are either (x) Loss Proceeds that Lender has elected to apply to
reduce the Debt in accordance with the terms of Article III hereof or (y) excess
Loss Proceeds remaining after the completion of any restoration required
hereunder, shall be transferred to Lender to be applied towards the Required
Debt Service Payment, (iii) sums held in the Recurring Replacement Reserve
Sub-Account shall be transferred to the Recurring Replacement Reserve Escrow
Account, (iv) sums held in the Operation and Maintenance Expense Sub-Account
shall be transferred to the Operation and Maintenance Expense Escrow Account,
(v) sums held in the Mez Payment Sub-Account shall be transferred to the Mez
Payment Escrow Account and (vi) sums held in the Curtailment Reserve Sub-Account
shall be transferred to the Curtailment Reserve Escrow Account.

      Section 5.06. Payment of Basic Carrying Costs. Borrower hereby agrees to
pay or cause Manager to pay all Basic Carrying Costs (without regard to the
amount of money in the Basic Carrying Costs Sub-Account or the Basic Carrying
Costs Escrow Account). At least ten (10) Business Days prior to the due date of
any Basic Carrying Costs, and not more frequently than once each month, Borrower
may notify Lender in writing and request that Lender pay such Basic Carrying
Costs on behalf of Borrower on or prior to the due date thereof, and, provided
that no Event of Default has occurred and that there are sufficient funds
available in the Basic Carrying Costs Escrow Account, Lender shall make such
payments out of the Basic Carrying Costs Escrow Account before same shall be
delinquent. Together with each such request, Borrower shall furnish Lender with
bills and all other documents necessary, as reasonably determined by Lender, for
the payment of the Basic Carrying Costs which are the subject of such request.
Borrower's obligation to pay (or cause Lender to pay) Basic Carrying Costs
pursuant to this Security Instrument shall include, to the extent permitted by
applicable law, Impositions resulting from future changes in law which impose
upon Lender an obligation to pay any property taxes or other Impositions or
which otherwise adversely affect Lender's interests.

      Provided that no Event of Default shall have occurred, all funds deposited
into the Basic Carrying Costs Escrow Account shall be held by Lender pursuant to
the provisions of this Security Instrument and shall be applied in payment of
Basic Carrying Costs in accordance with the terms hereof. Should an Event of
Default occur, the sums on deposit in the Basic Carrying Costs Sub-Account and
the Basic Carrying Costs Escrow Account may be applied by Lender in payment of
any Basic Carrying Costs or may be applied to the payment of the Debt or any
other charges affecting all or any portion of the Cross-collateralized
Properties as Lender in its sole discretion may determine; provided, however,
that no such application shall be deemed to have been made by operation of law
or otherwise until actually made by Lender as herein provided.

      Section 5.07. Intentionally Omitted.

      Section 5.08. Recurring Replacement Reserve Escrow Account. Borrower
hereby agrees to pay or cause Manager to pay all Recurring Replacement
Expenditures with respect to the Property (without regard to the amount of money
then available in the Recurring Replacement Reserve Sub-Account or the Recurring
Replacement Reserve Escrow Account). Provided that Lender has received written
notice from Borrower at least five (5) Business Days prior to the due date of
any payment relating to Recurring Replacement Expenditures and not more
frequently

                                       68
<PAGE>

than once each month, and further provided that no Event of Default has
occurred, that there are sufficient funds available in the Recurring Replacement
Reserve Escrow Account and Borrower shall have theretofore furnished Lender with
lien waivers, copies of bills, invoices and other reasonable documentation as
may be required by Lender to establish that the Recurring Replacement
Expenditures which are the subject of such request represent amounts due for
completed or partially completed capital work and improvements performed at the
Property, Lender shall make such payments out of the Recurring Replacement
Reserve Escrow Account.

      Provided that no Event of Default shall have occurred, all funds deposited
into the Recurring Replacement Reserve Escrow Account shall be held by Lender
pursuant to the provisions of this Security Instrument and shall be applied in
payment of Recurring Replacement Expenditures. Should an Event of Default occur,
the sums on deposit in the Recurring Replacement Reserve Sub-Account and the
Recurring Replacement Reserve Escrow Account may be applied by Lender in payment
of any Recurring Replacement Expenditures or may be applied to the payment of
the Debt or any other charges affecting all or any portion of the
Cross-collateralized Properties, as Lender in its sole discretion may determine;
provided, however, that no such application shall be deemed to have been made by
operation of law or otherwise until actually made by Lender as herein provided.
In lieu of maintaining sums on deposit in the Recurring Replacement Reserve
Escrow Account, Borrower may deliver an Approved Letter of Credit to Lender in
an amount equal to the sums required to be on deposit in the Recurring
Replacement Reserve Escrow Account (as the same may be amended, replaced,
extended or drawn down upon pursuant to the provisions of this Section 5.08, the
"Delivered Letter of Credit"). The Delivered Letter of Credit shall be held in
accordance with this Section 5.08 and otherwise constitute security for the
payment of the Debt. On or prior to the thirtieth (30th) day prior to the
expiration of any Delivered Letter of Credit, Borrower shall provide Lender with
a replacement to such Delivered Letter of Credit which shall be an Approved
Letter of Credit, and otherwise in the same form and amount as the Delivered
Letter of Credit being replaced. In the event (i) Borrower shall fail to provide
Lender with a replacement Delivered Letter of Credit on or prior to the
thirtieth (30th) day prior to the expiration of any previously existing
Delivered Letter of Credit or (ii) the long-term unsecured debt rating or the
short-term unsecured debt rating of the bank issuing the Delivered Letter of
Credit shall be downgraded below "AA-" (or its equivalent) or "A-1" (or its
equivalent), respectively, withdrawn or qualified by any Rating Agency and the
letter of credit required to be delivered hereunder is not replaced within
thirty (30) days of receipt of notice of such downgrading, withdrawal or
qualification, Lender may draw on the Delivered Letter of Credit, deposit all
sums received in connection with such draw into the Recurring Replacement
Reserve Escrow Account, and disburse such sums in accordance with this Section
5.08. Provided no Event of Default shall have occurred, upon Lender's receipt of
a written request from Borrower together with such other documentation as may be
reasonably requested by Lender, Lender shall draw on all or a portion of the
Delivered Letter of Credit, deposit any sums received in connection with such
draw into the Recurring Replacement Reserve Escrow Account, and apply such sums
towards the reimbursement of Borrower for any Recurring Replacement Expenditures
in accordance with the provisions of this Section 5.08. Upon the occurrence of
an Event of Default, Lender may draw on the Delivered Letter of Credit and apply
the sums received towards the payment of Recurring Replacement Expenditures or
towards payment of the Debt or any other charges affecting all or any portion of
the Property, as

                                       69
<PAGE>

Lender in its sole discretion may determine; provided, however, that no such
application shall be deemed to have been made by operation of law or otherwise
until actually made by Lender as herein provided. In the event Lender draws on
the Delivered Letter of Credit in accordance with the provisions of this Section
5.08, Borrower shall be required to either (a) provide an additional letter of
credit which shall be an Approved Letter of Credit in an amount equal to the
amount drawn under the Delivered Letter of Credit (the "Draw Amount") or (b)
deposit into the Recurring Replacement Reserve Escrow Account an amount equal to
the Draw Amount, in each case within ten (10) Business Days of such draw.

      Section 5.09. Operation and Maintenance Expense Escrow Account. Borrower
hereby agrees to pay or to cause Manager to pay all Operating Expenses with
respect to the Property (without regard to the amount of money then available in
the Operation and Maintenance Expense Sub-Account or the Operation and
Maintenance Expense Escrow Account). All funds allocated to the Operation and
Maintenance Expense Escrow Account shall be held by Lender pursuant to the
provisions of this Security Instrument. Any sums held in the Operation and
Maintenance Expense Escrow Account shall be disbursed to Borrower within five
(5) Business Days of receipt by Lender from Borrower of (a) a written request
for such disbursement which shall indicate the Operating Expenses (exclusive of
Basic Carrying Costs and any management fees payable to Borrower, or to any
Affiliate of Borrower) for which the requested disbursement is to pay and (b) an
Officer's Certificate stating that no Operating Expenses with respect to the
Property are more than sixty (60) days past due; provided, however, in the event
that Borrower legitimately disputes any invoice for an Operating Expense, and
(i) no Event of Default has occurred and is continuing hereunder, (ii) Borrower
shall have set aside adequate reserves for the payment of such disputed sums
together with all interest and late fees thereon, (iii) Borrower has complied
with all the requirements of this Security Instrument relating thereto, and (iv)
the contesting of such sums shall not constitute a default under any other
instrument, agreement, or document to which Borrower is a party, then Borrower
may, after certifying to Lender as to items (i) through (iv) hereof, contest
such invoice. Together with each such request, Borrower shall furnish Lender
with bills and all other documents necessary for the payment of the Operating
Expenses which are the subject of such request. Borrower may request a
disbursement from the Operation and Maintenance Expense Escrow Account no more
than one (1) time per calendar month. Should an Event of Default occur and be
continuing, the sums on deposit in the Operation and Maintenance Expense
Sub-Account or the Operation and Maintenance Expense Escrow Account may be
applied by Lender in payment of any Operating Expenses for the
Cross-collateralized Properties or may be applied to the payment of the Debt or
any other charges affecting all or any portion of the Property as Lender, in its
sole discretion, may determine; provided, however, that no such application
shall be deemed to have been made by operation of law or otherwise until
actually made by Lender as herein provided.

      Section 5.10. Intentionally Omitted.

      Section 5.11. Curtailment Reserve Escrow Account. Funds deposited into the
Curtailment Reserve Escrow Account shall be held by Lender in the Curtailment
Reserve Escrow Account as additional security for the Loan until the Loan has
been paid in full. All sums in the Curtailment Reserve Escrow Account which are
applied to the payment of the Loan

                                       70
<PAGE>

shall be applied only on a Payment Date. Additionally, provided that no Event of
Default has occurred and is continuing, and no O&M Operative Period has existed
for four (4) consecutive months, Lender shall, upon written request from
Borrower, release all sums contained in the Curtailment Reserve Escrow Account
to Borrower. Upon and during the continuance of any Event of Default, the sums
on deposit in the Curtailment Reserve Sub-Account and the Curtailment Reserve
Escrow Account may be applied by Lender to the payment of the Debt or other
charges affecting all or any portion of the Cross-collateralized Properties, as
Lender, in its sole discretion, may determine; provided, however, that no such
application shall be deemed to have been made by operation of law or otherwise
until actually made by Lender as herein provided.

      Section 5.12. Performance of Engineering Work. (a) Borrower shall promptly
commence and diligently thereafter pursue to completion (without regard to the
amount of money then available in the Engineering Escrow Account) the Required
Engineering Work prior to the date set forth for completion thereof on Exhibit
D. After Borrower completes an item of Required Engineering Work, Borrower may
submit to Lender an invoice therefor with lien waivers and a statement from the
Engineer, reasonably acceptable to Lender, indicating that the portion of the
Required Engineering Work in question has been completed in compliance with all
Legal Requirements, and Lender shall, within twenty (20) days thereafter,
although in no event more frequently than once each month, reimburse such amount
to Borrower from the Engineering Escrow Account; provided, however, that
Borrower shall not be reimbursed more than the amount set forth on EXHIBIT D
hereto as the amount allocated to the portion of the Required Engineering Work
for which reimbursement is sought.

      (b) From and after the date all of the Required Engineering Work is
completed, Borrower may submit a written request, which request shall be
delivered together with final lien waivers and a statement from the Engineer, as
the case may be, reasonably acceptable to Lender, indicating that all of the
Required Engineering Work has been completed in compliance with all Legal
Requirements, and Lender shall, within twenty (20) days thereafter, disburse any
balance of the Engineering Escrow Account to Borrower. Upon and during the
continuance of any Event of Default, the sums on deposit in the Engineering
Escrow Account may be applied by Lender in payment of any Required Engineering
Work or may be applied to the payment of the Debt or any other charges affecting
all or any portion of the Cross-collateralized Properties, as Lender in its sole
discretion may determine; provided, however, that no such application shall be
deemed to have been made by operation of law or otherwise until actually made by
Lender as herein provided.

      Section 5.13. Loss Proceeds. In the event of a casualty to the Property,
unless Lender elects, or is required pursuant to Article III hereof to make all
of the Insurance Proceeds available to Borrower for restoration, Lender and
Borrower shall cause all such Insurance Proceeds to be paid by the insurer
directly to the Central Account, whereupon Lender shall, after deducting
Lender's costs of recovering and paying out such Insurance Proceeds, including
without limitation, reasonable attorneys' fees, apply same to reduce the Debt in
accordance with the terms of the Note; provided, however, that if Lender elects,
or is deemed to have elected, to make the Insurance Proceeds available for
restoration, all Insurance Proceeds in respect of rent

                                       71
<PAGE>

loss, business interruption or similar coverage shall be maintained in the
Central Account, to be applied by Lender in the same manner as Rent received
with respect to the operation of the Property; provided, further, however, that
in the event that the Insurance Proceeds with respect to such rent loss,
business interruption or similar insurance policy are paid in a lump sum in
advance, Lender shall hold such Insurance Proceeds in a segregated
interest-bearing escrow account, which shall be an Eligible Account, shall
estimate, in Lender's reasonable discretion, the number of months required for
Borrower to restore the damage caused by the casualty, shall divide the
aggregate rent loss, business interruption or similar Insurance Proceeds by such
number of months, and shall disburse from such bank account into the Central
Account each month during the performance of such restoration such monthly
installment of said Insurance Proceeds minus, if (a) an O&M Operative Period
exists and (b) the Management Agreement which existed as of the Closing Date or
an Approved Replacement Management Agreement exists, the sum which otherwise
would be required to be deposited into the Operation and Maintenance Expense
Sub-Account if a Default Management Period existed, which sum shall be remitted
by Lender to Manager to pay Operating Expenses. In the event that Insurance
Proceeds are to be applied toward restoration, Lender shall hold such funds in a
segregated bank account at the Bank, which shall be an Eligible Account, and
shall disburse same in accordance with the provisions of Section 3.04 hereof.
Unless Lender elects, or is required pursuant to Section 6.01 hereof to make all
of the Condemnation Proceeds available to Borrower for restoration, Lender and
Borrower shall cause all such Condemnation Proceeds to be paid to the Central
Account, whereupon Lender shall, after deducting Lender's costs of recovering
and paying out such Condemnation Proceeds, including without limitation,
reasonable attorneys' fees, apply same to reduce the Debt in accordance with the
terms of the Note; provided, however, that any Condemnation Proceeds received in
connection with a temporary Taking shall be maintained in the Central Account,
to be applied by Lender in the same manner as Rent received with respect to the
operation of the Property; provided, further, however, that in the event that
the Condemnation Proceeds of any such temporary Taking are paid in a lump sum in
advance, Lender shall hold such Condemnation Proceeds in a segregated
interest-bearing bank account, which shall be an Eligible Account, shall
estimate, in Lender's reasonable discretion, the number of months that the
Property shall be affected by such temporary Taking, shall divide the aggregate
Condemnation Proceeds in connection with such temporary Taking by such number of
months, and shall disburse from such bank account into the Central Account each
month during the pendency of such temporary Taking such monthly installment of
said Condemnation Proceeds. In the event that Condemnation Proceeds are to be
applied toward restoration, Lender shall hold such funds in a segregated bank
account at the Bank, which shall be an Eligible Account, and shall disburse same
in accordance with the provisions of Section 3.04 hereof. If any Loss Proceeds
are received by Borrower, such Loss Proceeds shall be received in trust for
Lender, shall be segregated from other funds of Borrower, and shall be forthwith
paid into the Central Account, or paid to Lender to hold in a segregated bank
account at the Bank, in each case to be applied or disbursed in accordance with
the foregoing. Any Loss Proceeds made available to Borrower for restoration in
accordance herewith, to the extent not used by Borrower in connection with, or
to the extent they exceed the cost of, such restoration, shall be deposited into
the Central Account, whereupon Lender shall apply the same to reduce the Debt in
accordance with the terms of the Note.

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<PAGE>

      Section 5.14. Mez Payment Escrow Account. Provided that no Event of
Default has occurred and is continuing, on each Payment Date during which the
Mez Loan is outstanding, Lender shall transfer to the holder of each component
of the Mez Loan, as identified in writing by a joint direction executed by
Borrower, an amount equal to the Mez Payment Amount allocable to the applicable
component of the Mez Loan unless notice has been given of a default under any
loan which constitutes a part of the Mez Loan, in which event no sums deposited
into the Mez Payment Escrow Account will be remitted to any holder of a
component of the Mez Loan subordinate to the component of the Mez Loan for which
a default notice has been received (i.e., a component with a higher number in
the title to the loan agreement relating to such component). Should an Event of
Default occur, the sums on deposit in the Mez Payment Escrow Account may be
applied by Lender to the payment of the Debt or any other charges affecting all
or any portion of the Cross-collateralized Properties, as Lender in its sole
discretion may determine; provided, however, that no such application shall be
deemed to have been made by operation of law or otherwise until actually made by
Lender as herein provided.

                            ARTICLE VI: CONDEMNATION

      Section 6.01. Condemnation. (a) Borrower shall notify Lender promptly of
the commencement or threat of any Taking of the Property or any portion thereof.
Lender is hereby irrevocably appointed as Borrower's attorney-in-fact, coupled
with an interest, with exclusive power to collect, receive and retain the
proceeds of any such Taking and to make any compromise or settlement in
connection with such proceedings (subject to Borrower's reasonable approval,
except after the occurrence of an Event of Default, in which event Borrower's
approval shall not be required), subject to the provisions of this Security
Instrument; provided, however, that Borrower may participate in any such
proceedings and shall be authorized and entitled to compromise or settle any
such proceeding with respect to Condemnation Proceeds in an amount less than
five percent (5%) of the Loan Amount. Borrower shall execute and deliver to
Lender any and all instruments reasonably required in connection with any such
proceeding promptly after request therefor by Lender. Except as set forth above,
Borrower shall not adjust, compromise, settle or enter into any agreement with
respect to such proceedings without the prior consent of Lender. All
Condemnation Proceeds are hereby assigned to and shall be paid to Lender to be
applied in accordance with the terms hereof. With respect to Condemnation
Proceeds in an amount in excess of five percent (5%) of the Loan Amount,
Borrower hereby authorizes Lender to compromise, settle, collect and receive
such Condemnation Proceeds, and to give proper receipts and acquittance
therefor. Subject to the provisions of this Article VI, Lender may apply such
Condemnation Proceeds (less any cost to Lender of recovering and paying out such
proceeds, including, without limitation, reasonable attorneys' fees and
disbursements and costs allocable to inspecting any repair, restoration or
rebuilding work and the plans and specifications therefor) toward the payment of
the Debt or to allow such proceeds to be used for the Work.

      (b) "Substantial Taking" shall mean (i) a Taking of such portion of the
Property that would, in Lender's reasonable discretion, leave remaining a
balance of the Property which would not under then current economic conditions,
applicable Development Laws and other applicable Legal Requirements, permit the
restoration of the Property so as to constitute a

                                       73
<PAGE>

complete, rentable facility of the same sort as existed prior to the Taking,
having adequate ingress and egress to the Property, capable of producing a
projected Net Operating Income (as reasonably determined by Lender) yielding a
projected Debt Yield therefrom for the next two (2) years of not less than
8.25%, (ii) a Taking which occurs less than two (2) years prior to the Maturity
Date, (iii) a Taking which Lender is not reasonably satisfied could be restored
within ten (10) months unless Borrower has delivered to Lender cash collateral
in the amount estimated by Lender to be equal to (1) one-twelfth of the amount
of the insurance coverage required by clause (iii) of Section 3.01(a) multiplied
by (2) the number of months in excess of ten (10) which Lender reasonably
believes will be required to complete the restoration and at least six (6)
months prior to the Maturity Date or (iv) a Taking of more than fifteen percent
(15%) of the reasonably estimated fair market value of the Property.

      (c) In the case of a Substantial Taking, Condemnation Proceeds shall be
payable to Lender in reduction of the Debt but without any prepayment fee or
charge of any kind and, if Lender elects to apply any Condemnation Proceeds it
may receive pursuant to this Security Instrument to the payment of the Debt,
Borrower may prepay the balance of the Release Price with respect to the
Cross-collateralized Property which is subject to such Substantial Taking, in
accordance with Section 15.02, without any prepayment fee or charge of any kind.

      (d) In the event of a Taking which is less than a Substantial Taking,
Borrower at its sole cost and expense (whether or not the award shall have been
received or shall be sufficient for restoration) shall proceed diligently to
restore, or cause the restoration of, the remaining Improvements not so taken,
to maintain a complete, rentable, self-contained fully operational facility of
the same sort as existed prior to the Taking in as good a condition as is
reasonably possible. In the event of such a Taking, Lender shall receive the
Condemnation Proceeds and shall pay over the same:

            (i) first, provided no Default shall have occurred, to Borrower to
      the extent of any portion of the award as may be necessary to pay the
      reasonable cost of restoration of the Improvements remaining, and

            (ii) second, to Lender, in reduction of the Debt without any
      prepayment premium or charge of any kind.

If one or more Takings in the aggregate create a Substantial Taking, then, in
such event, the sections of this Article VI above applicable to Substantial
Takings shall apply.

      (e) In the event Lender is obligated to or elects to make Condemnation
Proceeds available for the restoration or rebuilding of the Property, such
proceeds shall be disbursed in the manner and subject to the conditions set
forth in Section 3.04(b) hereof. If, in accordance with this Article VI, any
Condemnation Proceeds are used to reduce the Debt, they shall be applied in
accordance with the provisions of the Note. Borrower shall promptly execute and
deliver all instruments requested by Lender for the purpose of confirming the
assignment of the Condemnation Proceeds to Lender. Application of all or any
part of the Condemnation Proceeds to the Debt shall be made in accordance with
the provisions of Sections 3.06 and 3.07 hereof. No application of the
Condemnation Proceeds to the reduction of the Debt shall have the

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<PAGE>

effect of releasing the lien of this Security Instrument until the remainder of
the Debt has been paid in full. In the case of any Taking, Lender, to the extent
that Lender has not been reimbursed by Borrower, shall be entitled, as a first
priority out of any Condemnation Proceeds, to reimbursement for all costs, fees
and expenses reasonably incurred in the determination and collection of any
Condemnation Proceeds. All Condemnation Proceeds deposited with Lender pursuant
to this Section, until expended or applied as provided herein, shall be held in
accordance with Section 3.04(b) hereof and shall constitute additional security
for the payment of the Debt and the payment and performance of Borrower's
obligations, but Lender shall not be deemed a trustee or other fiduciary with
respect to its receipt of such Condemnation Proceeds or any part thereof. All
awards so deposited with Lender shall be held by Lender in an Eligible Account,
but Lender makes no representation or warranty as to the rate or amount of
interest, if any, which may accrue on any such deposit and shall have no
liability in connection therewith. For purposes hereof, any reference to the
award shall be deemed to include interest, if any, which has accrued thereon.

                         ARTICLE VII: LEASES AND RENTS

      Section 7.01. Assignment. (a) Borrower does hereby bargain, sell, assign
and set over unto Lender, all of Borrower's interest in the Leases and Rents.
The assignment of Leases and Rents in this Section 7.01 is an absolute,
unconditional and present assignment from Borrower to Lender and not an
assignment for security and the existence or exercise of Borrower's revocable
license to collect Rent shall not operate to subordinate this assignment to any
subsequent assignment. The exercise by Lender of any of its rights or remedies
pursuant to this Section 7.01 shall not be deemed to make Lender a
mortgagee-in-possession. In addition to the provisions of this Article VII,
Borrower shall comply with all terms, provisions and conditions of the
Assignment.

      (b) So long as there shall exist and be continuing no Event of Default,
Borrower shall have a revocable license to take all actions with respect to all
Leases and Rents, present and future, including the right to collect and use the
Rents, subject to the terms of this Security Instrument and the Assignment.

      (c) In a separate instrument Borrower shall, as requested from time to
time by Lender, assign to Lender or its nominee by specific or general
assignment, any and all Leases, such assignments to be in form and content
reasonably acceptable to Lender, but subject to the provisions of Section
7.01(b) hereof. Borrower agrees to deliver to Lender, within thirty (30) days
after Lender's request, a true and complete copy of every Lease.

      (d) The rights of Lender contained in this Article VII, the Assignment or
any other assignment of any Lease shall not result in any obligation or
liability of Lender to Borrower or any lessee under a Lease or any party
claiming through any such lessee.

      (e) At any time after an Event of Default, the license granted hereinabove
may be revoked by Lender, and Lender or a receiver appointed in accordance with
this Security Instrument may enter upon the Property, and collect, retain and
apply the Rents toward payment of the Debt in such priority and proportions as
Lender in its sole discretion shall deem proper.

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<PAGE>

Provided that the Management Agreement which existed as of the Closing Date or
an Approved Replacement Management Agreement is in place and no default exists
thereunder, Manager may continue to collect such Rents on behalf of Lender.

      (f) In addition to the rights which Lender may have herein, upon the
occurrence of any Event of Default, Lender, at its option, may require Borrower
to pay monthly in advance to Lender, or any receiver appointed to collect the
Rents, the fair and reasonable rental value for the use and occupation of such
part of the Property as may be used and occupied by Borrower and may require
Borrower to vacate and surrender possession of the Property to Lender or to such
receiver and, in default thereof, Borrower may be evicted by summary proceedings
or otherwise.

      (g) Lender shall, upon request of Borrower, enter into a subordination,
nondisturbance and attornment agreement ("SNDA") with respect to each proposed
tenant entering into a Lease in compliance with the requirements of this
Security Instrument. Any SNDA executed by Lender shall be in Lender's then
standard form or such other form as is reasonably acceptable to Lender and
provide that in the event Lender or any purchaser at foreclosure shall succeed
to Borrower's interest in the Property, the Leases of such tenants will remain
in full force and effect and be binding upon Lender or such purchaser and such
tenant as though each were original parties thereto.

      Section 7.02. Management of Property. (a) Borrower shall manage the
Property or cause the Property to be managed by an Approved Manager. All Space
Leases shall provide for rental rates comparable to then existing local market
rates and terms and conditions which constitute good and prudent business
practice and are consistent with prevailing market terms and conditions, and
shall be arms-length transactions. All Leases entered into after the date hereof
shall be subordinate to this Security Instrument by operation of law or pursuant
to an SNDA executed by Lender and the tenant under the applicable Lease.
Borrower shall deliver copies of all Leases, amendments, modifications and
renewals thereof to Lender. All proposed Leases for the Property shall be
subject to the prior written approval of Lender, provided, however that Borrower
may enter into new leases with unrelated third parties without obtaining the
prior consent of Lender provided that: (i) the proposed leases conform with the
requirements of this Section 7.02; (ii) the space to be leased pursuant to such
proposed lease together with any spaced leased to any Affiliate of the tenant
under such proposed lease does not exceed 10,000 square feet; and (iii) the term
of the proposed lease inclusive of all extensions and renewals, does not exceed
ten (10) years plus up to two (2) sixty (60) month option terms (or equivalent
combination of renewals).

      (b) Borrower (i) shall observe and perform or, shall cause Operating
Tenant to observe and perform all of its material obligations under the Leases
pursuant to applicable Legal Requirements and shall not do or permit to be done
anything to impair the value of the Leases as security for the Debt; (ii) shall
promptly send copies to Lender of all notices of default which Borrower shall
receive under the Leases; (iii) shall enforce all of the material terms,
covenants and conditions contained in the Leases to be observed or performed;
(iv) shall not collect any of the Rents under the Leases more than one (1) month
in advance (except that Borrower may collect in advance such security deposits
as are permitted pursuant to applicable Legal

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<PAGE>

Requirements and are commercially reasonable in the prevailing market); (v)
shall not execute any other assignment of lessor's interest in the Leases or the
Rents except as otherwise expressly permitted pursuant to this Security
Instrument; (vi) shall not cancel or terminate any of the Leases or accept a
surrender thereof in any manner inconsistent with commercially reasonable
standards exercised by Approved Managers; (vii) shall not convey, transfer or
suffer or permit a conveyance or transfer of all or any part of the Premises or
the Improvements or of any interest therein so as to effect a merger of the
estates and rights of, or a termination or diminution of the obligations of,
lessees thereunder; (viii) shall not alter, modify or change the terms of any
guaranty of any Major Space Lease or cancel or terminate any such guaranty; (ix)
shall make all reasonable efforts to seek lessees for leasable space as it
becomes vacant and enter into Leases in accordance with the terms hereof; (x)
shall not materially modify, alter or amend any Major Space Lease or Property
Agreement without Lender's consent, which consent will not be unreasonably
withheld or delayed; (xi) shall notify Lender promptly if any Pad Owner shall
cease business operations or of the occurrence of any event of which it becomes
aware affecting a Pad Owner or its property which might have any material effect
on the Property; and (xii) shall, without limitation to any other provision
hereof, execute and deliver at the request of Lender all such further
assurances, confirmations and assignments in connection with the Property as are
required herein and as Lender shall from time to time reasonably require.

      (c) All security deposits of lessees of the Property shall be treated as
trust funds and shall not be commingled with any other funds of Borrower, and,
such deposits shall be deposited, upon receipt of the same by Borrower in a
separate trust account maintained by Borrower expressly for such purpose;
provided, however, so long as such security deposits do not, in the aggregate
exceed the sum of $100,000 at any Cross-collateralized Property, Borrower shall
not be required to treat such deposits at such Property as trust funds and may
commingle such deposits. Within ten (10) Business Days after written request by
Lender, Borrower shall furnish to Lender reasonably satisfactory evidence of
compliance with this Section 7.02(c), together with a statement of all security
deposits securities deposited with Borrower by the lessees and, if such deposits
exceed the sum of $100,000 in the aggregate at any Cross-collateralized
Property, the location and account number of the account in which such security
deposits are held.

      (d) If requested by Lender, Borrower shall furnish, or shall cause the
applicable lessee to furnish, to Lender financial data and/or financial
statements in accordance with Regulation AB for any lessee of the Property if,
in connection with a Securitization, Lender expects there to be, with respect to
such lessee or any group of affiliated lessees, a concentration within all of
the mortgage loans included or expected to be included, as applicable, in such
Securitization such that such lessee or group of affiliated lessees would
constitute a Significant Obligor; provided, however, that in the event the
related Space Lease does not require the related lessee to provide the foregoing
information, Borrower shall use commercially reasonable efforts to cause the
applicable lessee to furnish such information.

      (e) Borrower covenants and agrees with Lender that (i) the Property will
be managed at all times by Manager pursuant to the management agreement approved
by Lender (individually or collectively as the context requires, the "Management
Agreement"), (ii) after Borrower has knowledge of a fifty percent (50%) or more
change in control of the ownership of

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<PAGE>

Manager, Borrower will promptly give Lender notice thereof (a "Manager Control
Notice") and (iii) any Management Agreement may be terminated by Lender at any
time following an uncured monetary Event of Default and acceleration of all
amounts due under the Loan, provided that there otherwise exists a right to
terminate the Manager (after all applicable notice and cure periods) under the
Management Agreement, and a substitute managing agent shall be appointed by
Borrower, subject to Lender's prior written approval, which may be given or
withheld in Lender's reasonable discretion and which may be conditioned on,
inter alia, a letter from each Rating Agency confirming that any rating issued
by the Rating Agency in connection with a Securitization will not, as a result
of the proposed change of Manager, be downgraded from the then current ratings
thereof, qualified or withdrawn. Borrower may from time to time appoint a
successor manager to manage the Property with Lender's prior written consent
which consent shall not be unreasonably withheld or delayed, provided that any
such successor manager shall be a reputable management company which is an
Approved Manager. Borrower further covenants and agrees that Borrower shall
require Manager (or any successor managers) to maintain at all times during the
term of the Loan worker's compensation insurance as required by Governmental
Authorities.

      (f) Borrower shall (i) pay or shall cause to be paid all sums required to
be paid by Borrower under the Franchise Agreement, if any, and Operating Lease,
(ii) diligently perform and observe all of the terms, covenants and conditions
of the Franchise Agreement, if any, on the part of Borrower to be performed and
observed to the end that all things shall be done which are necessary to keep
unimpaired the rights of Borrower under the Franchise Agreement, if any, and
Operating Lease, (iii) promptly notify Lender of the giving of any notice to
Borrower of any default by Borrower in the performance or observance of any of
the terms, covenants or conditions of the Franchise Agreement, if any, or
Operating Lease on the part of Borrower to be performed and observed and deliver
to Lender a true copy of each such notice, and (iv) promptly deliver to Lender a
copy of each financial statement, business plan, capital expenditures plan,
notice, report and estimate required to be delivered under the Franchise
Agreement, if any, or the Operating Lease. Borrower shall not, without the prior
consent of the Lender, surrender the Franchise Agreement, if any, or Operating
Lease or terminate or cancel the Franchise Agreement, if any, or modify, change,
supplement, alter or amend the Franchise Agreement, if any, or Operating Lease,
in any respect, either orally or in writing, and Borrower hereby assigns to
Lender as further security for the payment of the Debt and for the performance
and observance of the terms, covenants and conditions of this Security
Instrument, all the rights, privileges and prerogatives of Borrower to surrender
the Franchise Agreement, if any, or Operating Lease or to terminate, cancel,
modify, change, supplement, alter or amend the Franchise Agreement, if any, or
Operating Lease in any respect, and any such surrender of the Franchise
Agreement, if any, or termination, cancellation, modification, change,
supplement, alteration or amendment of the Franchise Agreement, if any, or
Operating Lease without the prior consent of Lender shall be void and of no
force and effect. If Borrower shall default in the performance or observance of
any material term, covenant or condition of the Franchise Agreement, if any, or
Operating Lease on the part of Borrower to be performed or observed, then,
without limiting the generality of the other provisions of this Security
Instrument, and without waiving or releasing Borrower from any of its
obligations hereunder, Lender shall have the right, but shall be under no
obligation, to pay any sums and to perform any act or take any action as may be
appropriate to cause all the

                                       78
<PAGE>

terms, covenants and conditions of the Franchise Agreement, if any, or Operating
Lease on the part of Borrower to be performed or observed to be promptly
performed or observed on behalf of Borrower, to the end that the rights of
Borrower in, to and under the Franchise Agreement and Operating Lease shall be
kept unimpaired and free from default. Lender and any Person designated by
Lender shall have, and are hereby granted, the right to enter upon the Property
at any time and from time to time for the purpose of taking any such action. If
the franchisor under the Franchise Agreement, if any, or lessee under an
Operating Lease shall deliver to Lender a copy of any notice sent to Borrower of
default under the Franchise Agreement, if any, or Operating Lease, as
applicable, such notice shall constitute full protection to Lender for any
action to be taken by Lender in good faith, in reliance thereon. Borrower shall,
from time to time, use its best efforts to obtain from the franchisor or lessee
under the Franchise Agreement, if any, such certificates of estoppel with
respect to compliance by Borrower with the terms of the Franchise Agreement, if
any, as may be requested by Lender. Borrower shall exercise each individual
option, if any, to extend or renew the term of the Franchise Agreement, if any,
within four (4) months of the last day upon which any such option may be
exercised, unless Lender consents to the non-renewal of such Franchise
Agreement, if any, in writing, and Borrower hereby expressly authorizes and
appoints Lender its attorney-in-fact to exercise any such option in the name of
and upon behalf of Borrower, which power of attorney shall be irrevocable and
shall be deemed to be coupled with an interest.

      (g) Borrower shall fund and operate, or shall cause Manager to fund and
operate, the Property in a manner consistent with a hotel of the same type and
category as the Property and in compliance with any Franchise Agreement and
Operating Lease.

      (h) Borrower shall maintain or cause Operating Tenant to cause Manager to
maintain Inventory in kind and amount sufficient to meet hotel industry
standards for hotels comparable to the hotel located at the Premises and at
levels sufficient for the operation of the hotel located at the Premises at
historic occupancy levels.

      (i) Borrower shall deliver to Lender all notices of default or termination
received by Borrower, Operating Tenant or Manager with respect to any material
licenses and permits, contracts, Property Agreements, Leases or insurance
policies within three (3) Business Days of receipt of the same where such
default or termination could reasonably result in a Material Adverse Effect.

      (j) Borrower shall not permit any Equipment or other personal property to
be removed from the Property unless the removed item is consumed or sold in the
ordinary course of business, removed temporarily for maintenance and repair, or,
if removed permanently, replaced by an article of equivalent suitability and not
materially less value, owned by Borrower free and clear of any lien.

                      ARTICLE VIII: MAINTENANCE AND REPAIR

      Section 8.01. Maintenance and Repair of the Property; Alterations;
Replacement of Equipment. Borrower hereby covenants and agrees:

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<PAGE>

      (a) Borrower shall not (i) desert or abandon the Property, (ii) change the
use of the Property or cause or permit the use or occupancy of any part of the
Property to be discontinued if such discontinuance or use change would violate
any zoning or other law, ordinance or regulation; (iii) consent to or seek any
lowering of the zoning classification, or greater zoning restriction affecting
the Property; or (iv) take any steps whatsoever to convert the Property, or any
portion thereof, to a condominium or cooperative form of ownership.

      (b) Borrower shall, or shall cause Operating Tenant (or Manager) to (i)
take good care of the Property including grounds generally, and utility systems
and sidewalks, roads, alleys, and curbs therein, and shall keep the same in
good, safe and insurable condition and in compliance with all applicable Legal
Requirements, (ii) promptly make all repairs to the Property, above grade and
below grade, interior and exterior, structural and nonstructural, ordinary and
extraordinary, unforeseen and foreseen, and maintain the Property in a manner
appropriate for the facility and (iii) not commit or suffer to be committed any
waste of the Property or do or suffer to be done anything which will increase
the risk of fire or other hazard to the Property or impair the value thereof.
Borrower shall keep the sidewalks, vaults, gutters and curbs comprising, or
adjacent to, the Property, clean and free from dirt, snow, ice, rubbish and
obstructions. All repairs made by or on behalf of Borrower shall be made with
first-class materials, in a good and workmanlike manner, shall be equal or
better in quality and class to the original work and shall comply with all
applicable Legal Requirements and Insurance Requirements. To the extent any of
the above obligations are obligations of tenants under Space Leases or Pad
Owners or other Persons under Property Agreements, Borrower may fulfill its
obligations hereunder by causing such tenants, Pad Owners or other Persons, as
the case may be, to perform their obligations thereunder. As used herein, the
terms "repair" and "repairs" shall be deemed to include all necessary
replacements.

      (c) Borrower shall not demolish, remove, construct, or, except as
otherwise expressly provided herein, restore, or alter the Property or any
portion thereof; nor consent to or permit any such demolition, removal,
construction, restoration, addition or alteration which in any case would
diminish the value of the Property without Lender's prior written consent in
each instance, which consent shall not be unreasonably withheld or delayed.
Notwithstanding the foregoing, Borrower shall have the right to complete the
ballroom project located at the Ritz Premises and to construct a clubhouse to be
located in whole or in part on the Additional Property (collectively, the
"Planned Projects") subject to the satisfaction of the following conditions
precedent:

            (i) No Event of Default shall have occurred and be continuing and
      Lender shall have received a certificate from Borrower, in form and
      substance acceptable to Lender, confirming the foregoing.

            (ii) Borrower shall have given Lender at least thirty (30) days
      prior written notice of its election to perform the Planned Projects.

            (iii) Lender shall have received valid certificates of insurance
      indicating that the requirements for the policies of insurance required
      hereunder have been satisfied

                                       80
<PAGE>

      with respect to the Planned Projects and evidence of the payment of all
      premiums payable for the existing policy period.

            (iv) Lender shall have received plans and specifications and a fixed
      price construction contract for the Planned Projects, together with such
      other construction documents as Lender shall reasonably require.

            (v) Borrower shall cause Guarantor to execute a completion guaranty
      in form and substance reasonably satisfactory to Lender guarantying
      lien-free completion of the Planned Projects.

            (vi) The completion of the Planned Projects will not have a Material
      Adverse Effect.

            (vii) Lender shall have received such other and further approvals,
      opinions, documents and information in connection with the Planned
      Projects as Lender may have reasonably requested.

            (viii) All of the items set forth in (i) through (vii) above shall
      be in form and substance reasonably acceptable to Lender.

      (d) Borrower represents and warrants to Lender that (i) there are no
fixtures, machinery, apparatus, tools, equipment or articles of personal
property attached or appurtenant to, or located on, or used in connection with
the management, operation or maintenance of the Property, except for the
Equipment, equipment leased by Borrower for the management, operation or
maintenance of the Property in accordance with the Loan Documents and equipment
owned or leased by Manager or Operating Lessee pursuant to the terms of the
Management Agreement or Operating Lease (the "Third Party Equipment"); (ii) the
Equipment, the leased equipment and the Third Party Equipment constitute all of
the fixtures, machinery, apparatus, tools, equipment and articles of personal
property necessary to the proper operation and maintenance of the Property; and
(iii) all of the Equipment is free and clear of all liens, except for the lien
of this Security Instrument and the Permitted Encumbrances. All right, title and
interest of Borrower in and to all extensions, improvements, betterments,
renewals and appurtenances to the Property hereafter acquired by, or released
to, Borrower or constructed, assembled or placed by Borrower in the Property,
and all changes and substitutions of the security constituted thereby, shall be
and, in each such case, without any further mortgage, encumbrance, conveyance,
assignment or other act by Lender or Borrower, shall become subject to the lien
and security interest of this Security Instrument as fully and completely, and
with the same effect, as though now owned by Borrower and specifically described
in this Security Instrument, but at any and all times Borrower shall execute and
deliver to Lender any documents Lender may reasonably deem necessary or
appropriate for the purpose of specifically subjecting the same to the lien and
security interest of this Security Instrument.

      (e) Notwithstanding the provisions of this Security Instrument to the
contrary, Borrower shall have the right, at any time and from time to time, to
remove and dispose of Equipment which may have become obsolete or unfit for use
or which is no longer useful in the

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<PAGE>

management, operation or maintenance of the Property. Borrower shall promptly
replace any such Equipment so disposed of or removed with other Equipment of
equal value and utility, free of any security interest or superior title, liens
or claims; except that, if by reason of technological or other developments,
replacement of the Equipment so removed or disposed of is not necessary or
desirable for the proper management, operation or maintenance of the Property,
Borrower shall not be required to replace the same. All such replacements or
additional equipment shall be deemed to constitute "Equipment" and shall be
covered by the security interest herein granted.

              ARTICLE IX: TRANSFER OR ENCUMBRANCE OF THE PROPERTY

      Section 9.01. Other Encumbrances. Borrower shall not further encumber or
permit the further encumbrance in any manner (whether by grant of a pledge,
security interest or otherwise) of the Property or any part thereof or interest
therein, including, without limitation, of the Rents therefrom. In addition,
Borrower shall not further encumber and shall not permit the further encumbrance
in any manner (whether by grant of a pledge, security interest or otherwise) of
Borrower or any direct or indirect interest in Borrower except as expressly
permitted pursuant to this Security Instrument.

      Section 9.02. No Transfer. (a) Borrower acknowledges that Lender has
examined and relied on the expertise of Borrower and, if applicable, each
General Partner, in owning and operating properties such as the Property in
agreeing to make the Loan and will continue to rely on Borrower's ownership of
the Property as a means of maintaining the value of the Property as security for
repayment of the Debt and Borrower acknowledges that Lender has a valid interest
in maintaining the value of the Property. Borrower shall not Transfer, nor
permit any Transfer, without the prior written consent of Lender, which consent
Lender may withhold in its sole and absolute discretion. Lender shall not be
required to demonstrate any actual impairment of its security or any increased
risk of default hereunder in order to declare the Debt immediately due and
payable upon a Transfer without Lender's consent. This provision shall apply to
every Transfer regardless of whether voluntary or not, or whether or not Lender
has consented to any previous Transfer.

      (b) Indirect equity holders in Borrower may obtain additional financing
(the "Additional Financing") and pledge indirect equity ownership in Borrower as
collateral for such additional debt provided that (i) the Loan-to-Value Ratio
(including for the purposes hereof the aggregate Additional Financing together
with the then outstanding Principal Amount and the unpaid principal amount of
the Mez Loan) does not exceed 80%, (ii) no Default exists, (iii) Lender has
approved the proposed holder of the Additional Financing, which proposed holder
has entered into an intercreditor agreement with Lender and the holders of the
Mez Loan in form and substance acceptable to Lender and the holders of the Mez
Loan, (iv) such Additional Financing has a maturity date no earlier than the
Maturity Date, (v) such Additional Financing and any pledge of collateral in
connection therewith is subordinate in lien and payment to the Loan and the Mez
Loan and (vi) Borrower delivers to Lender a letter from each Rating Agency
confirming that any rating issued by the Rating Agency in connection with a
Securitization will not, as a result of the Additional Financing be downgraded
from the then current ratings thereof, qualified or withdrawn. For the purpose
of this Section 9.02, "Loan-to-Value Ratio" shall mean,

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at the time of calculation, the ratio of (a) the Principal Amount plus the
outstanding principal amount of the Mez Loan to (b) the aggregate value of the
Cross-collateralized Properties. The value of each of the Cross-collateralized
Properties shall be determined by Lender in its reasonable discretion and the
aggregate value of the Cross-collateralized Properties shall equal the aggregate
of the value of each of the Cross-collateralized Properties as so determined by
Lender; provided, however, the value of each of the Cross-collateralized
Properties shall be subject to Borrower's review and approval and if Borrower
objects in writing to Lender's determination of the value of any
Cross-collateralized Property at any time, Lender will commission, at Borrower's
sole cost and expense, a third-party independent appraiser reasonably
satisfactory to Lender and Borrower to prepare an appraisal of the value of such
Cross-collateralized Property in form and substance acceptable to Lender, in its
reasonable discretion, which appraisal and the appraised value of such
Cross-collateralized Property therein shall be binding on Lender and Borrower
for purposes hereof and used as the value of such Cross-collateralized Property
for purposes of calculating the Loan-to-Value Ratio at such time.

      Section 9.03. Due on Sale. Lender may declare the Debt immediately due and
payable upon any Transfer or further encumbrance without Lender's consent
without regard to whether any impairment of its security or any increased risk
of default hereunder can be demonstrated. This provision shall apply to every
Transfer or further encumbrance of the Property or any part thereof or interest
in the Property or in Borrower regardless of whether voluntary or not, or
whether or not Lender has consented to any previous Transfer or further
encumbrance of the Property or interest in Borrower.

      Section 9.04. Permitted Easements, Etc. Notwithstanding any other
provisions of this Article 9, Borrower may grant easements and other rights
necessary for the development and operation of any real property adjacent to the
Premises provided that the granting of such easements or other rights is
consistent with a commercially reasonable standard and the granting of such
easement or other rights shall not, individually or in the aggregate, interfere
with the benefits of the security intended to be provided by this Security
Instrument, adversely affect the value of the marketability of the Property,
impair the use or operation of the Property or materially impair Borrower's
ability to pay its obligations in a timely manner.

                            ARTICLE X: CERTIFICATES

      Section 10.01. Estoppel Certificates. (a) After request by Lender,
Borrower, within twenty (20) days and at its expense, will furnish Lender with a
statement, duly acknowledged and certified, setting forth (i) the amount of the
original principal amount of the Note, and the unpaid principal amount of the
Note, (ii) the rate of interest of the Note, (iii) the date payments of interest
and/or principal were last paid, (iv) any offsets or defenses to the payment of
the Debt and, if any are alleged, the nature thereof, (v) that the Note and this
Security Instrument have not been modified or if modified, giving particulars of
such modification and (vi) that there has occurred and is then continuing no
Default or if such Default exists, the nature thereof, the period of time it has
existed, and the action being taken to remedy such Default.

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<PAGE>

      (b) Within twenty (20) days after written request by Borrower, Lender
shall furnish to Borrower a written statement confirming the amount of the Debt,
the maturity date of the Note and the date to which interest has been paid.

      (c) Borrower shall use all reasonable efforts to obtain estoppel
certificates from tenants in form and substance reasonably acceptable to Lender.

                              ARTICLE XI: NOTICES

      Section 11.01. Notices. Any notice, demand, statement, request or consent
made hereunder shall be in writing and delivered personally or sent to the party
to whom the notice, demand or request is being made by Federal Express or other
nationally recognized overnight delivery service, as follows and shall be deemed
given upon delivery or attempted delivery personally or by Federal Express or
such other nationally recognized delivery service:

      If to Lender:          Wachovia Bank, National Association
                             Commercial Real Estate Services
                             8739 Research Drive URP 4
                             NC 1075
                             Charlotte, North Carolina  28262
                             Loan Number:  _________________
                             Attention:  Portfolio Management
                             Fax No.: (704) 715-0036

      with a copy to:

                             Proskauer Rose LLP
                             1585 Broadway
                             New York, New York 10036
                             Attn:  David J. Weinberger, Esq.
                             Fax No.: (212) 969-2900

      If to Borrower:        To Borrower, at the address first written above,

      with a copy to:

                             Lowndes, Drosdick, Doster, Kantor & Reed, :P.A.
                             215 N. Eola Drive
                             Orlando, Florida  32801
                             Attn:  Richard J. Fildes, Esq.
                             Fax No.: (407) 843-4444

or such other address as either Borrower or Lender shall hereafter specify by
not less than ten (10) days prior written notice as provided herein; provided,
however, that notwithstanding any provision of this Article to the contrary,
such notice of change of address shall be deemed given

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<PAGE>

only upon actual receipt thereof. Rejection or other refusal to accept or the
inability to deliver because of changed addresses of which no notice was given
as herein required shall be deemed to be receipt of the notice, demand,
statement, request or consent.

                          ARTICLE XII: INDEMNIFICATION

      Section 12.01. Indemnification Covering Property. In addition, and without
limitation, to any other provision of this Security Instrument or any other Loan
Document, Borrower shall protect, indemnify and save harmless Lender and its
successors and assigns, and each of their agents, employees, officers,
directors, stockholders, partners and members (collectively, "Indemnified
Parties") for, from and against any claims, demands, penalties, fines,
liabilities, settlements, damages, costs and expenses of whatever kind or
nature, known or unknown, contingent or otherwise, whether incurred or imposed
within or outside the judicial process, including, without limitation,
reasonable attorneys' fees and disbursements imposed upon or incurred by or
asserted against any of the Indemnified Parties by reason of (a) ownership of
this Security Instrument, the Assignment, the Property or any part thereof or
any interest therein or receipt of any Rents; (b) any accident, injury to or
death of any person or loss of or damage to property occurring in, on or about
the Property or any part thereof or on the adjoining sidewalks, curbs, parking
areas, streets or ways; (c) any use, nonuse or condition in, on or about, or
possession, alteration, repair, operation, maintenance or management of, the
Property or any part thereof or on the adjoining sidewalks, curbs, parking
areas, streets or ways; (d) any failure on the part of Borrower to perform or
comply with any of the terms of this Security Instrument or the Assignment; (e)
performance of any labor or services or the furnishing of any materials or other
property in respect of the Property or any part thereof; (f) any claim by
brokers, finders or similar Persons claiming to be entitled to a commission in
connection with any Lease or other transaction involving the Property or any
part thereof; (g) any Imposition including, without limitation, any Imposition
attributable to the execution, delivery, filing, or recording of any Loan
Document, Lease or memorandum thereof; (h) any lien or claim arising on or
against the Property or any part thereof under any Legal Requirement or any
liability asserted against any of the Indemnified Parties with respect thereto;
(i) any claim arising out of or in any way relating to any tax or other
imposition on the making and/or recording of this Security Instrument, the Note
or any of the other Loan Documents; (j) a Default under Sections 2.02(f),
2.02(g), 2.02(k), 2.02(t) or 2.02(w) hereof, (k) the failure of any Person to
file timely with the Internal Revenue Service an accurate Form 1099-B, Statement
for Recipients of Proceeds from Real Estate, Broker and Barter Exchange
Transactions, which may be required in connection with the Loan, or to supply a
copy thereof in a timely fashion to the recipient of the proceeds of the Loan;
(l) the claims of any lessee or any Person acting through or under any lessee or
otherwise arising under or as a consequence of any Lease or (m) the failure to
pay any insurance premiums. Notwithstanding the foregoing provisions of this
Section 12.01 to the contrary, Borrower shall have no obligation to indemnify
the Indemnified Parties pursuant to this Section 12.01 for liabilities,
obligations, claims, damages, penalties, causes of action, costs and expenses
relative to the foregoing which result from Lender's, and its successors' or
assigns', willful misconduct or gross negligence. Any amounts payable to Lender
by reason of the application of this Section 12.01 shall constitute a part of
the Debt secured by this Security Instrument and the other Loan

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<PAGE>

Documents and shall become immediately due and payable and shall bear interest
at the Default Rate from the date the liability, obligation, claim, cost or
expense is sustained by Lender, as applicable, until paid. The provisions of
this Section 12.01 shall survive the termination of this Security Instrument
whether by repayment of the Debt, foreclosure or delivery of a deed in lieu
thereof, assignment or otherwise. In case any action, suit or proceeding is
brought against any of the Indemnified Parties by reason of any occurrence of
the type set forth in (a) through (m) above, Borrower shall, at Borrower's
expense, resist and defend such action, suit or proceeding or will cause the
same to be resisted and defended by counsel at Borrower's expense for the
insurer of the liability or by counsel designated by Borrower (unless reasonably
disapproved by Lender promptly after Lender has been notified of such counsel);
provided, however, that nothing herein shall compromise the right of Lender (or
any other Indemnified Party) to appoint its own counsel at Borrower's expense
for its defense with respect to any action which, in the reasonable opinion of
Lender or such other Indemnified Party, as applicable, presents a conflict or
potential conflict between Lender or such other Indemnified Party that would
make such separate representation advisable. Any Indemnified Party will give
Borrower prompt notice after such Indemnified Party obtains actual knowledge of
any potential claim by such Indemnified Party for indemnification hereunder. The
Indemnified Parties shall not settle or compromise any action, proceeding or
claim as to which it is indemnified hereunder without notice to Borrower.

                             ARTICLE XIII: DEFAULTS

      Section 13.01. Events of Default. The Debt shall become immediately due at
the option of Lender upon any one or more of the following events ("Event of
Default"):

      (a) if the final payment or prepayment premium, if any, due under the Note
shall not be paid on Maturity;

      (b) if any monthly payment of interest and/or principal due under the Note
(other than the sums described in (a) above) shall not be fully paid on the date
upon which the same is due and payable thereunder;

      (c) if payment of any sum (other than the sums described in (a) above or
(b) above) required to be paid pursuant to the Note, this Security Instrument or
any other Loan Document shall not be paid within ten (10) days after Lender
delivers written notice to Borrower that same is due and payable thereunder or
hereunder;

      (d) if Borrower, Operating Tenant, Guarantor or, if Borrower or Guarantor
is a partnership, any general partner of Borrower, Operating Tenant or
Guarantor, or, if Operating Tenant, Borrower, Operating Tenant or Guarantor is a
limited liability company, any member of Borrower, Operating Tenant or
Guarantor, shall institute or cause to be instituted any proceeding for the
termination or dissolution of Borrower, Operating Tenant, Guarantor or any such
general partner or member;

      (e) if (i) Borrower fails to deliver to Lender the original insurance
policies or certificates as herein provided (provided, however, that if the
insurance policies required by this Security Instrument are maintained in full
force and effect and Lender receives either a

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<PAGE>

certificate or original policies required by this Security Instrument for each
such insurance policy within the time periods specified in this Security
Instrument, then Borrower shall have five (5) days after notice from Lender of
Borrower's failure to deliver the original policies or certificates (whichever
has not been delivered as required) to deliver same to Lender before such
failure becomes an Event of Default) or (ii) if the insurance policies required
hereunder are not kept in full force and effect as herein provided (no notice or
cure period applies to this item (ii));

      (f) if Borrower or Guarantor attempts to assign its rights under this
Security Instrument or any other Loan Document or any interest herein or
therein, or if any Transfer occurs other than in accordance with the provisions
hereof;

      (g) if any representation or warranty of Borrower or Guarantor made herein
or in any other Loan Document or in any certificate, report, financial statement
or other instrument or agreement furnished to Lender shall prove false or
misleading in any material respect as of the date made; provided, however, that
if such representation or warranty which was false or misleading in any material
respect is, by its nature, curable and is not reasonably likely to have a
Material Adverse Effect, and such representation or warranty was not, to the
best of Borrower's knowledge, false or misleading in any material respect when
made, then the same shall not constitute an Event of Default unless Borrower has
not cured the same within five (5) Business Days after receipt by Borrower of
notice from Lender in writing of such breach;

      (h) if Borrower, Operating Tenant, Guarantor or any general partner of
Borrower, Operating Tenant or Guarantor shall make an assignment for the benefit
of creditors or shall admit in writing its inability to pay its debts generally
as they become due;

      (i) if a receiver, liquidator or trustee of Borrower, Operating Tenant,
Guarantor or any general partner of Borrower, Operating Tenant or Guarantor
shall be appointed or if Borrower, Guarantor or their respective general
partners shall be adjudicated a bankrupt or insolvent, or if any petition for
bankruptcy, reorganization or arrangement pursuant to federal bankruptcy law, or
any similar federal or state law, shall be filed by or against, consented to, or
acquiesced in by, Borrower, Operating Tenant, Guarantor or their respective
general partners or if any proceeding for the dissolution or liquidation of
Borrower, Operating Tenant, Guarantor or their respective general partners shall
be instituted; however, if such appointment, adjudication, petition or
proceeding was involuntary and not consented to by Borrower, Operating Tenant,
Guarantor or their respective general partners, as applicable, upon the same not
being discharged, stayed or dismissed within ninety (90) days or if Borrower,
Operating Tenant, Guarantor or their respective general partners shall generally
not be paying its debts as they become due;

      (j) if Borrower shall be in default beyond any notice or grace period, if
any, under any other mortgage or deed of trust or security agreement covering
any part of the Property without regard to its priority relative to this
Security Instrument; provided, however, this provision shall not be deemed a
waiver of the provisions of Article IX prohibiting further encumbrances
affecting the Property or any other provision of this Security Instrument;

      (k) if the Property becomes subject (i) to any lien which is superior to
the lien of this Security Instrument, other than a lien for real estate taxes
and assessments not due and payable,

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<PAGE>

or (ii) to any mechanic's, materialman's or other lien which is or is asserted
to be superior to the lien of this Security Instrument, and such lien shall
remain undischarged (by payment, bonding, or otherwise) for forty-five (45) days
unless contested in accordance with the terms hereof;

      (l) if Borrower discontinues the operation of the Property or any part
thereof for reasons other than repair or restoration arising from a casualty or
condemnation for ten (10) days or more;

      (m) except as permitted in this Security Instrument, any material
alteration, demolition or removal of any of the Improvements without the prior
consent of Lender;

      (n) if Borrower consummates a transaction which would cause this Security
Instrument or Lender's rights under this Security Instrument, the Note or any
other Loan Document to constitute a non-exempt prohibited transaction under
ERISA or result in a violation of a state statute regulating government plans
subjecting Lender to liability for a violation of ERISA or a state statute;

      (o) if a default beyond applicable notice and grace periods, if any,
occurs under a Franchise Agreement, or if a Franchise Agreement is terminated,
or if, without Lender's prior written consent, there is a material change to a
Franchise Agreement; or

      (p) if a default shall occur under any of the other terms, covenants or
conditions of the Note, this Security Instrument or any other Loan Document,
other than as set forth in (a) through (o) above, for ten (10) days after notice
from Lender in the case of any default which can be cured by the payment of a
sum of money, or for thirty (30) days after notice from Lender in the case of
any other default or an additional sixty (60) days if Borrower is diligently and
continuously effectuating a cure of a curable non-monetary default, other than
as set forth in (a) through (o) above.

      Section 13.02. Remedies. (a) Upon the occurrence and during the
continuance of any Event of Default, Lender may, in addition to any other rights
or remedies available to it hereunder or under any other Loan Document, at law
or in equity, take such action, without notice or demand, as it reasonably deems
advisable to protect and enforce its rights against Borrower and in and to the
Property including, but not limited to, the following actions, each of which may
be pursued singly, concurrently or otherwise, at such time and in such order as
Lender may determine, in its sole discretion, without impairing or otherwise
affecting any other rights and remedies of Lender hereunder, at law or in
equity: (i) declare all or any portion of the unpaid Debt to be immediately due
and payable; provided, however, that upon the occurrence of any of the events
specified in Section 13.01(i), the entire Debt will be immediately due and
payable without notice or demand or any other declaration of the amounts due and
payable; or (ii) bring an action to foreclose this Security Instrument and
without applying for a receiver for the Rents, but subject to the rights of the
tenants under the Leases, enter into or upon the Property or any part thereof,
either personally or by its agents, nominees or attorneys, and dispossess
Borrower and its agents and servants therefrom, and thereupon Lender may (A)
use, operate, manage, control, insure, maintain, repair, restore and otherwise
deal with all and every part of the Property and conduct the business thereat,
(B) make alterations, additions, renewals,

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<PAGE>

replacements and improvements to or on the Property or any part thereof, (C)
exercise all rights and powers of Borrower with respect to the Property or any
part thereof, whether in the name of Borrower or otherwise, including, without
limitation, the right to make, cancel, enforce or modify Leases, obtain and
evict tenants, and demand, sue for, collect and receive all earnings, revenues,
rents, issues, profits and other income of the Property and every part thereof,
and (D) apply the receipts from the Property or any part thereof to the payment
of the Debt, after deducting therefrom all expenses (including, without
limitation, reasonable attorneys' fees and disbursements) reasonably incurred in
connection with the aforesaid operations and all amounts necessary to pay the
Impositions, insurance and other charges in connection with the Property or any
part thereof, as well as just and reasonable compensation for the services of
Lender's third-party agents; or (iii) have an appraisal or other valuation of
the Property or any part thereof performed by an appraiser acceptable to Lender
(and Borrower covenants and agrees it shall cooperate in causing any such
valuation or appraisal to be performed) and any cost or expense incurred by
Lender in connection therewith shall constitute a portion of the Debt and be
secured by this Security Instrument and shall be immediately due and payable to
Lender with interest, at the Default Rate, until the date of receipt by Lender;
or (iv) sell the Property or institute proceedings for the complete foreclosure
of this Security Instrument, or take such other action as may be allowed
pursuant to Legal Requirements, at law or in equity, for the enforcement of this
Security Instrument in which case the Property or any part thereof may be sold
for cash or credit in one or more parcels; or (v) with or without entry, and to
the extent permitted and pursuant to the procedures provided by applicable Legal
Requirements, institute proceedings for the partial foreclosure of this Security
Instrument, or take such other action as may be allowed pursuant to Legal
Requirements, at law or in equity, for the enforcement of this Security
Instrument for the portion of the Debt then due and payable, subject to the lien
of this Security Instrument continuing unimpaired and without loss of priority
so as to secure the balance of the Debt not then due; or (vi) sell the Property
or any part thereof and any or all estate, claim, demand, right, title and
interest of Borrower therein and rights of redemption thereof, pursuant to power
of sale or otherwise, at one or more sales, in whole or in parcels, in any order
or manner, at such time and place, upon such terms and after such notice thereof
as may be required or permitted by law, at the discretion of Lender, and in the
event of a sale, by foreclosure or otherwise, of less than all of the Property,
this Security Instrument shall continue as a lien on the remaining portion of
the Property; or (vii) institute an action, suit or proceeding in equity for the
specific performance of any covenant, condition or agreement contained in the
Loan Documents, or any of them; or (viii) recover judgment on the Note or any
guaranty either before, during or after (or in lieu of) any proceedings for the
enforcement of this Security Instrument; or (ix) apply, ex parte, for the
appointment of a custodian, trustee, receiver, keeper, liquidator or conservator
of the Property or any part thereof, irrespective of the adequacy of the
security for the Debt and without regard to the solvency of Borrower or of any
Person liable for the payment of the Debt, to which appointment Borrower does
hereby consent and such receiver or other official shall have all rights and
powers permitted by applicable law and such other rights and powers as the court
making such appointment may confer, but the appointment of such receiver or
other official shall not impair or in any manner prejudice the rights of Lender
to receive the Rent with respect to any of the Property pursuant to this
Security Instrument or the Assignment; or (x) require, at Lender's option,
Borrower to pay monthly in advance to Lender, or any receiver appointed to
collect the Rents, the fair and reasonable rental value for the use and
occupation of any portion of

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<PAGE>

the Property occupied by Borrower and may require Borrower to vacate and
surrender possession to Lender of the Property or to such receiver and Borrower
may be evicted by summary proceedings or otherwise; or (xi) without notice to
Borrower (A) apply all or any portion of the cash collateral in any Sub-Account
and Escrow Account, including any interest and/or earnings therein, to carry out
the obligations of Borrower under this Security Instrument and the other Loan
Documents, to protect and preserve the Property and for any other purpose
permitted under this Security Instrument and the other Loan Documents and/or (B)
have all or any portion of such cash collateral immediately paid to Lender to be
applied against the Debt in the order and priority set forth in the Note; or
(xii) pursue any or all such other rights or remedies as Lender may have under
applicable law or in equity; provided, however, that the provisions of this
Section 13.02(a) shall not be construed to extend or modify any of the notice
requirements or grace periods provided for hereunder or under any of the other
Loan Documents. Borrower hereby waives, to the fullest extent permitted by Legal
Requirements, any defense Borrower might otherwise raise or have by the failure
to make any tenants parties defendant to a foreclosure proceeding and to
foreclose their rights in any proceeding instituted by Lender.

      (b) The proceeds or avails of any foreclosure sale made under or by virtue
of this Section 13.02, together with any other sums which then may be held by
Lender under this Security Instrument, whether under the provisions of this
Section 13.02 or otherwise, shall be applied as follows:

      First: To the payment of the third-party costs and expenses reasonably
      incurred in connection with any such sale and to advances, fees and
      expenses, including, without limitation, reasonable fees and expenses of
      Lender's legal counsel as applicable, and of any judicial proceedings
      wherein the same may be made, and of all expenses, liabilities and
      advances reasonably made or incurred by Lender under this Security
      Instrument, together with interest as provided herein on all such advances
      made by Lender, and all Impositions, except any Impositions or other
      charges subject to which the Property shall have been sold;

      Second: To the payment of the whole amount then due, owing and unpaid
      under the Note for principal and interest thereon, with interest on such
      unpaid principal at the Default Rate from the date of the occurrence of
      the earliest Event of Default that formed a basis for such sale until the
      same is paid;

      Third: To the payment of any other portion of the Debt required to be paid
      by Borrower pursuant to any provision of this Security Instrument, the
      Note, or any of the other Loan Documents; and

      Fourth: The surplus, if any, to Borrower unless otherwise required by
      Legal Requirements.

Lender and any receiver or custodian of the Property or any part thereof shall
be liable to account for only those rents, issues, proceeds and profits actually
received by it.

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<PAGE>

      (c) In the event of any sale made under or by virtue of this Section
13.02, the entire Debt immediately thereupon shall, anything in the Loan
Documents to the contrary notwithstanding, become due and payable.

      (d) Upon any sale made under or by virtue of this Section 13.02, Lender
may bid for and acquire the Property or any part thereof and in lieu of paying
cash therefor may make settlement for the purchase price by crediting upon the
Debt the net sales price after deducting therefrom the expenses of the sale and
the costs of the action.

      (e) No recovery of any judgment by Lender and no levy of an execution
under any judgment upon the Property or any part thereof or upon any other
property of Borrower shall release the lien of this Security Instrument upon the
Property or any part thereof, or any liens, rights, powers or remedies of Lender
hereunder, but such liens, rights, powers and remedies of Lender shall continue
unimpaired until all amounts due under the Note, this Security Instrument and
the other Loan Documents are paid in full.

      (f) Upon the exercise by Lender of any power, right, privilege, or remedy
pursuant to this Security Instrument which requires any consent, approval,
registration, qualification, or authorization of any Governmental Authority,
Borrower agrees to execute and deliver, or will cause the execution and delivery
of, all applications, certificates, instruments, assignments and other documents
and papers that Lender or any purchaser of the Property may be required to
obtain for such governmental consent, approval, registration, qualification, or
authorization and Lender is hereby irrevocably appointed the true and lawful
attorney-in-fact of Borrower (coupled with an interest), in its name and stead,
to execute all such applications, certificates, instruments, assignments and
other documents and papers.

      Section 13.03. Payment of Debt After Default. If, following the occurrence
of any Event of Default, Borrower shall tender payment of an amount sufficient
to satisfy the Debt in whole or in part at any time prior to a foreclosure sale
of the Property, and if at the time of such tender prepayment of the principal
balance of the Note is not permitted by the Note or this Security Instrument,
Borrower shall, in addition to the entire Debt, also pay to Lender a sum equal
to (a) all accrued interest on the Note and all other fees, charges and sums due
and payable hereunder, (b) all costs and expenses in connection with the
enforcement of Lender's rights hereunder, and (c) a prepayment charge (the
"Prepayment Charge") equal to the greater of (i) 3% of the Principal Amount and
(ii) the present value of a series of payments each equal to the Payment
Differential (as hereinafter defined) and payable on each Payment Date over the
remaining original term of the Note and on the Payment Date occurring two months
prior to the Maturity Date, discounted at the Reinvestment Yield (as hereinafter
defined) for the number of months remaining as of the date of such prepayment to
each such Payment Date and the Payment Date occurring two months prior to the
Maturity Date. The term "Payment Differential" shall mean an amount equal to (i)
the Interest Rate less the Reinvestment Yield, divided by (ii) twelve (12) and
multiplied by (iii) the Principal Amount after application of the constant
monthly payment due under the Note on the date of such prepayment, provided that
the Payment Differential shall in no event be less than zero. The term
"Reinvestment Yield" shall mean an amount equal to the lesser of (i) the yield
on the U.S. Treasury issue (primary issue) with a

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maturity date closest to the Payment Date occurring two months prior to the
Maturity Date, or (ii) the yield on the U.S. Treasury issue (primary issue) with
a term equal to the remaining average life of the indebtedness evidenced by the
Note, with each such yield being based on the bid price for such issue as
published in the Wall Street Journal on the date that is fourteen (14) days
prior to the date of such prepayment set forth in the notice of prepayment (or,
if such bid price is not published on that date, the next preceding date on
which such bid price is so published) and converted to a monthly compounded
nominal yield. In addition to the amounts described above, if, during the first
(1st) Loan Year, Borrower shall tender payment of an amount sufficient to
satisfy the Debt in whole or in part following the occurrence of any Event of
Default, Borrower shall, in addition to the entire Debt, also pay to Lender a
sum equal to three percent (3%) of the Principal Amount. Failure of Lender to
require any of these payments shall not constitute a waiver of the right to
require the same in the event of any subsequent default or to exercise any other
remedy available to Lender hereunder, under any other Loan Document or at law or
in equity. In the event that any prepayment charge is due hereunder, Lender
shall deliver to Borrower a statement setting forth the amount and determination
of the prepayment fee, and, provided that Lender shall have in good faith
applied the formula described above, Borrower shall not have the right to
challenge the calculation or the method of calculation set forth in any such
statement in the absence of manifest error, which calculation may be made by
Lender on any day during the fifteen (15) day period preceding the date of such
prepayment. Lender shall not be obligated or required to have actually
reinvested the prepaid principal balance at the Reinvestment Yield or otherwise
as a condition to receiving the prepayment charge. If at the time of such
tender, prepayment of the principal balance of the Note is permitted, such
tender by Borrower shall be deemed to be a voluntary prepayment of the principal
balance of the Note, and Borrower shall, in addition to the entire Debt, also
pay to Lender the applicable prepayment consideration specified in the Note and
this Security Instrument.

      Section 13.04. Possession of the Property. Upon the occurrence of any
Event of Default and the acceleration of the Debt or any portion thereof,
Borrower, if an occupant of the Property or any part thereof, upon demand of
Lender, shall immediately surrender possession of the Property (or the portion
thereof so occupied) to Lender, and if Borrower is permitted to remain in
possession, the possession shall be as a month-to-month tenant of Lender and, on
demand, Borrower shall pay to Lender monthly, in advance, a reasonable rental
for the space so occupied and in default thereof Borrower may be dispossessed.
The covenants herein contained may be enforced by a receiver of the Property or
any part thereof. Nothing in this Section 13.04 shall be deemed to be a waiver
of the provisions of this Security Instrument making the Transfer of the
Property or any part thereof without Lender's prior written consent an Event of
Default.

      Section 13.05. Interest After Default. If any amount due under the Note,
this Security Instrument or any of the other Loan Documents is not paid within
any applicable notice and grace period after same is due, whether such date is
the stated due date, any accelerated due date or any other date or at any other
time specified under any of the terms hereof or thereof, then, in such event,
Borrower shall pay interest on the amount not so paid from and after the date on
which such amount first becomes due at the Default Rate; and such interest shall
be due and payable at such rate until the earlier of the cure of all Events of
Default or the payment of the

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entire amount due to Lender, whether or not any action shall have been taken or
proceeding commenced to recover the same or to foreclose this Security
Instrument. All unpaid and accrued interest shall be secured by this Security
Instrument as part of the Debt. Nothing in this Section 13.05 or in any other
provision of this Security Instrument shall constitute an extension of the time
for payment of the Debt.

      Section 13.06. Borrower's Actions After Default. After the happening of
any Event of Default and immediately upon the commencement of any action, suit
or other legal proceedings by Lender to obtain judgment for the Debt, or of any
other nature in aid of the enforcement of the Loan Documents, Borrower will (a)
after receipt of notice of the institution of any such action, waive the
issuance and service of process and enter its voluntary appearance in such
action, suit or proceeding, and (b) if required by Lender, consent to the
appointment of a receiver or receivers of the Property or any part thereof and
of all the earnings, revenues, rents, issues, profits and income thereof.

      Section 13.07. Control by Lender After Default. Notwithstanding the
appointment of any custodian, receiver, liquidator or trustee of Borrower, or of
any of its property, or of the Property or any part thereof, to the extent
permitted by Legal Requirements, Lender shall be entitled to obtain possession
and control of all property now and hereafter covered by this Security
Instrument and the Assignment in accordance with the terms hereof.

      Section 13.08. Right to Cure Defaults. (a) Upon the occurrence of any
Event of Default, Lender or its agents may, but without any obligation to do so
and without notice to or demand on Borrower and without releasing Borrower from
any obligation hereunder, make or do the same in such manner and to such extent
as Lender may deem necessary to protect the security hereof. Lender and its
agents are authorized to enter upon the Property or any part thereof for such
purposes, or appear in, defend, or bring any action or proceedings to protect
Lender's interest in the Property or any part thereof or to foreclose this
Security Instrument or collect the Debt, and the cost and expense thereof
(including reasonable attorneys' fees to the extent permitted by law), with
interest as provided in this Section 13.08, shall constitute a portion of the
Debt and shall be immediately due and payable to Lender upon demand. All such
costs and expenses incurred by Lender or its agents in remedying such Event of
Default or in appearing in, defending, or bringing any such action or proceeding
shall bear interest at the Default Rate, for the period from the date so
demanded to the date of payment to Lender. All such costs and expenses incurred
by Lender or its agents together with interest thereon calculated at the above
rate shall be deemed to constitute a portion of the Debt and be secured by this
Security Instrument.

      (b) If Lender makes any payment or advance that Lender is authorized by
this Security Instrument to make in the place and stead of Borrower (i) relating
to the Impositions or tax liens asserted against the Property, Lender may do so
according to any bill, statement or estimate procured from the appropriate
public office without inquiry into the accuracy of the bill, statement or
estimate or into the validity of any of the Impositions or the tax liens or
claims thereof; (ii) relating to any apparent or threatened adverse title, lien,
claim of lien, encumbrance, claim or charge, Lender will be the sole judge of
the legality or validity of same; or (iii) relating

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to any other purpose authorized by this Security Instrument but not enumerated
in this Section 13.08, Lender may do so whenever, in its judgment and
discretion, the payment or advance seems necessary or desirable to protect the
Property and the full security interest intended to be created by this Security
Instrument. In connection with any payment or advance made pursuant to this
Section 13.08, Lender has the option and is authorized, but in no event shall be
obligated, to obtain a continuation report of title prepared by a title
insurance company. The payments and the advances made by Lender pursuant to this
Section 13.08 and the cost and expenses of said title report will be due and
payable by Borrower on demand, together with interest at the Default Rate, and
will be secured by this Security Instrument.

      Section 13.09. Late Payment Charge. If any portion of the Debt is not paid
in full on or before the day on which it is due and payable hereunder, Borrower
shall pay to Lender an amount equal to four percent (4%) of such unpaid portion
of the Debt ("Late Charge") to defray the expense incurred by Lender in handling
and processing such delinquent payment, and such amount shall constitute a part
of the Debt.

      Section 13.10. Recovery of Sums Required to Be Paid. Lender shall have the
right from time to time to take action to recover any sum or sums which
constitute a part of the Debt as the same become due and payable hereunder
(after the expiration of any grace period or the giving of any notice herein
provided, if any), without regard to whether or not the balance of the Debt
shall be due, and without prejudice to the right of Lender thereafter to bring
an action of foreclosure, or any other action, for a default or defaults by
Borrower existing at the time such earlier action was commenced.

      Section 13.11. Marshalling and Other Matters. Borrower hereby waives, to
the fullest extent permitted by law, the benefit of all appraisement, valuation,
stay, extension, reinstatement, redemption (both equitable and statutory) and
homestead laws now or hereafter in force and all rights of marshalling in the
event of any sale hereunder of the Property or any part thereof or any interest
therein. Nothing herein or in any other Loan Document shall be construed as
requiring Lender to resort to any particular Cross-collateralized Property for
the satisfaction of the Debt in preference or priority to any other
Cross-collateralized Property but Lender may seek satisfaction out of all the
Cross-collateralized Properties or any part thereof in its absolute discretion.
Further, Borrower hereby expressly waives any and all rights of redemption from
sale under any order or decree of foreclosure of this Security Instrument on
behalf of Borrower, whether equitable or statutory and on behalf of each and
every Person acquiring any interest in or title to the Property or any part
thereof subsequent to the date of this Security Instrument and on behalf of all
Persons to the fullest extent permitted by applicable law.

      Section 13.12. Tax Reduction Proceedings. After an Event of Default,
Borrower shall be deemed to have appointed Lender as its attorney-in-fact to
seek a reduction or reductions in the assessed valuation of the Property for
real property tax purposes or for any other purpose and to prosecute any action
or proceeding in connection therewith. This power, being coupled with an
interest, shall be irrevocable for so long as any part of the Debt remains
unpaid and any Event of Default shall be continuing.

      Section 13.13. General Provisions Regarding Remedies.

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      (a) Right to Terminate Proceedings. Lender may terminate or rescind any
proceeding or other action brought in connection with its exercise of the
remedies provided in Section 13.02 at any time before the conclusion thereof, as
determined in Lender's sole discretion and without prejudice to Lender.

      (b) No Waiver or Release. The failure of Lender to exercise any right,
remedy or option provided in the Loan Documents shall not be deemed a waiver of
such right, remedy or option or of any covenant or obligation contained in the
Loan Documents. No acceptance by Lender of any payment after the occurrence of
an Event of Default and no payment by Lender of any payment or obligation for
which Borrower is liable hereunder shall be deemed to waive or cure any Event of
Default. No sale of all or any portion of the Property, no forbearance on the
part of Lender, and no extension of time for the payment of the whole or any
portion of the Debt or any other indulgence given by Lender to Borrower or any
other Person, shall operate to release or in any manner affect the interest of
Lender in the Property or the liability of Borrower to pay the Debt. No waiver
by Lender shall be effective unless it is in writing and then only to the extent
specifically stated.

      (c) No Impairment; No Releases. The interests and rights of Lender under
the Loan Documents shall not be impaired by any indulgence, including (i) any
renewal, extension or modification which Lender may grant with respect to any of
the Debt; (ii) any surrender, compromise, release, renewal, extension, exchange
or substitution which Lender may grant with respect to the Property or any
portion thereof; or (iii) any release or indulgence granted to any maker,
endorser, guarantor or surety of any of the Debt.

      (d) Effect on Judgment. No recovery of any judgment by Lender and no levy
of an execution under any judgment upon any Property or any portion thereof
shall affect in any manner or to any extent the lien of this Security Instrument
upon the remaining Cross-collateralized Properties or any portion thereof, or
any rights, powers or remedies of Lender hereunder or thereunder. Such lien,
rights, powers and remedies of Lender shall continue unimpaired as before.

                   ARTICLE XIV: COMPLIANCE WITH REQUIREMENTS

      Section 14.01. Compliance with Legal Requirements. (a) Borrower shall
promptly comply with all present and future Legal Requirements, foreseen and
unforeseen, ordinary and extraordinary, whether requiring structural or
nonstructural repairs or alterations including, without limitation, all zoning,
subdivision, building, safety and environmental protection, land use and
development Legal Requirements, all Legal Requirements which may be applicable
to the curbs adjoining the Property or to the use or manner of use thereof, and
all rent control, rent stabilization and all other similar Legal Requirements
relating to rents charged and/or collected in connection with the Leases.
Borrower represents and warrants that the Property is in compliance in all
respects with all Legal Requirements as of the date hereof, no notes or notices
of violations of any Legal Requirements have been entered or received by
Borrower and there is no basis for the entering of such notes or notices.

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      (b) Borrower shall have the right to contest by appropriate legal
proceedings diligently conducted in good faith, without cost or expense to
Lender, the validity or application of any Legal Requirement and to suspend
compliance therewith if permitted under applicable Legal Requirements, provided
(i) failure to comply therewith may not subject Lender to any civil or criminal
liability, (ii) prior to and during such contest, Borrower shall furnish to
Lender security reasonably satisfactory to Lender, in its discretion, against
loss or injury by reason of such contest or non-compliance with such Legal
Requirement, (iii) no Default or Event of Default shall exist during such
proceedings and such contest shall not otherwise violate any of the provisions
of any of the Loan Documents, (iv) such contest shall not, (unless Borrower
shall comply with the provisions of clause (ii) of this Section 14.01(b))
subject the Property to any lien or encumbrance the enforcement of which is not
suspended or otherwise affect the priority of the lien of this Security
Instrument; (v) such contest shall not affect the ownership, use or occupancy of
the Property; (vi) the Property or any part thereof or any interest therein
shall not be in any danger of being sold, forfeited or lost by reason of such
contest by Borrower; (vii) Borrower shall give Lender prompt notice of the
commencement of such proceedings and, upon request by Lender, notice of the
status of such proceedings and/or confirmation of the continuing satisfaction of
the conditions set forth in clauses (i) - (vi) of this Section 14.01(b); and
(viii) upon a final determination of such proceeding, Borrower shall take all
steps necessary to comply with any requirements arising therefrom.

      (c) Borrower shall at all times comply with all applicable Legal
Requirements with respect to the construction, use and maintenance of any vaults
adjacent to the Property. If by reason of the failure to pay taxes, assessments,
charges, permit fees, franchise taxes or levies of any kind or nature, the
continued use of the vaults adjacent to Property or any part thereof is
discontinued, Borrower nevertheless shall, with respect to any vaults which may
be necessary for the continued use of the Property, take such steps (including
the making of any payment) to ensure the continued use of vaults or
replacements.

      Section 14.02. Compliance with Recorded Documents; No Future Grants.
Borrower shall promptly perform and observe or cause to be performed and
observed, all of the terms, covenants and conditions of all Property Agreements
and all things necessary to preserve intact and unimpaired any and all
appurtenances or other interests or rights affecting the Property.

                       ARTICLE XV: DEFEASANCE; PREPAYMENT

      Section 15.01. Defeasance; Prepayment. (a) Except as set forth in this
Section 15.01, no prepayment or defeasance of the Debt may be made by or on
behalf of Borrower in whole or in part.

      (b) Borrower may defease the Loan at any time subsequent to the earlier to
occur of (x) the second (2nd) anniversary of a Securitization or (y) the third
(3rd) anniversary of the date hereof and prior to the calendar month immediately
preceding the Maturity Date, in whole or, from time to time, in part, as of the
last day of an Interest Accrual Period, in accordance with the following
provisions:

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            (i) Lender shall have received from Borrower, not less than thirty
      (30) days', nor more than ninety (90) days', prior written notice
      specifying the date proposed for such defeasance and the amount which is
      to be defeased, which proposed date shall be as of a Payment Date.

            (ii) Borrower shall also pay to Lender all interest due through and
      including the last day of the Interest Accrual Period ending on the day
      prior to the Payment Date in which such defeasance is being made, together
      with any and all other amounts due and owing pursuant to the terms of the
      Note, this Security Instrument or the other Loan Documents, including,
      without limitation, any costs incurred in connection with a defeasance.

            (iii) No Event of Default shall have occurred and be continuing.

            (iv) Borrower shall (A) pay the Defeasance Deposit and (B) deliver
      to Lender (1) a security agreement, in form and substance reasonably
      satisfactory to Lender, creating a first priority lien on the Defeasance
      Deposit and the Federal Obligations purchased on behalf of Borrower with
      the Defeasance Deposit in accordance with the terms of this Section
      15.01(b)(iv) (the "Security Agreement"); (2) an Officer's Certificate
      certifying that the requirements set forth in this Section 15.01(b)(iv)
      have been satisfied; (3) an opinion of counsel for Borrower in form and
      substance reasonably satisfactory to Lender stating, among other things,
      that (x) Lender has a perfected security interest in the Defeasance
      Deposit and a first priority perfected security interest in the Federal
      Obligations purchased by Lender on behalf of Borrower, (y) the
      contemplated defeasance will not result in any deemed exchange pursuant to
      Section 1001 of the Code of the Note and will not adversely affect the
      Note's or, if applicable, the undefeased Note's status as indebtedness for
      Federal income tax purposes and (z) any trust formed as a "real estate
      mortgage investment conduit" within the meaning of Section 860D of the
      Code ("REMIC") in connection with a Securitization will not fail to
      maintain its status as a REMIC as a result of such defeasance; (4) in the
      event that only a portion of the Loan is being defeased, Borrower shall
      execute and deliver all necessary documents to split the Note into two
      substitute notes, one having a principal balance equal to the defeased
      portion of the Note (the "Defeased Note") and one note having a principal
      balance equal to the undefeased portion of the Note (the "Undefeased
      Note"), the amortization schedule for which notes shall be calculated, in
      the case of a Defeased Note, or recalculated, in the case of an Undefeased
      Note, to provide for interest only payments through the maturity date of
      such notes; (5) a certificate, in form and substance reasonably
      satisfactory to Lender from a nationally recognized Independent certified
      public accountant confirming that the requirements of this Section
      15.01(b) have been satisfied; and (6) such other certificates, documents,
      opinions or instruments as Lender may reasonably request. Borrower
      reserves the right to purchase Federal Obligations with and in lieu of
      making the Defeasance Deposit which provide Scheduled Defeasance Payments,
      and appoints Lender as its agent and attorney-in-fact, coupled with an
      interest (which appointment will not be exercised if Borrower notifies
      Lender in writing in the notice provided for in Section 15.01(b)(i) that
      Borrower will be purchasing the Federal Obligations), for the

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      purpose of using the Defeasance Deposit to purchase Federal Obligations
      which provide Scheduled Defeasance Payments, and Lender shall, upon
      receipt of the Defeasance Deposit, purchase such Federal Obligations on
      behalf of Borrower. Borrower, pursuant to the Security Agreement or other
      appropriate document, shall authorize and direct that the payments
      received from the Federal Obligations shall be made directly to Lender and
      applied to satisfy the obligations of Borrower under the Defeased Note.
      The Defeased Note and the Undefeased Note shall have identical terms as
      the Note, except for the principal balance. A Defeased Note cannot be the
      subject of a further defeasance.

            (v) The Rating Agencies shall have confirmed in writing that any
      rating issued by the Rating Agencies in connection with the Securitization
      will not, as a result of the proposed defeasance, be downgraded, from the
      then current ratings thereof, qualified or withdrawn.

            (vi) If the Loan is to be defeased and Borrower is requesting a
      release of the Property in connection with such defeasance, such
      defeasance shall be to facilitate the disposition of the Property or in
      connection with any other customary transaction within the meaning of
      Treas. Reg. 1.860G-(2)(a)(8)(iii).

            (vii) In the event of a defeasance of the Loan in whole, but not in
      part, if Borrower shall continue to own any assets other than the
      Defeasance Deposit, Borrower shall establish or designate a
      special-purpose bankruptcy-remote successor entity acceptable to Lender
      (the "Successor Borrower"), with respect to which a substantive
      nonconsolidation opinion satisfactory in form and substance reasonably
      satisfactory to Lender has been delivered to Lender and Borrower shall
      transfer and assign to the Successor Borrower all obligations, rights and
      duties under the Note and the Security Agreement, together with the
      pledged Defeasance Deposit. The Successor Borrower shall assume the
      obligations of Borrower under the Note and the Security Agreement and
      Borrower shall be relieved of its obligations hereunder and thereunder.
      Borrower shall pay Ten and No/100 Dollars ($10.00) to the Successor
      Borrower as consideration for assuming such Borrower obligations.

            (viii) In the event the Loan is defeased in full in accordance with
      the terms hereof, Lender shall release all reserves, escrows and
      guaranties relating to the Loan to Borrower.

      (c) At any time prior to the earlier of the third (3rd) anniversary of the
date hereof and the second (2nd) anniversary of the last Securitization
involving any portion of the Loan, Borrower may prepay the Loan in whole or, if
such prepayment is made in connection with a release of an Out-Parcel made in
accordance with Section 15.03 hereof or in connection with a Release in
accordance with Section 15.02 hereof, in part. Additionally, at any time on or
subsequent to the Payment Date occurring in December, 2010 (the "Lockout
Expiration Date"), Borrower may prepay the Loan, in whole, but not in part. Any
prepayment of the Loan permitted under this paragraph (c) shall be made as of
the last day of an Interest Accrual Period in accordance with the following
provisions:

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            (i) Lender shall have received from Borrower, not less than thirty
      (30) days', nor more than ninety (90) days', prior written notice
      specifying the date proposed for such prepayment and the amount which is
      to be prepaid.

            (ii) Borrower shall also pay to Lender all interest due through and
      including the last day of the Interest Accrual Period in which such
      prepayment is being made, together with any and all other amounts due and
      owing pursuant to the terms of the Note, this Security Instrument or the
      other Loan Documents.

            (iii) Any partial prepayment shall be in a minimum amount not less
      than $25,000 and shall be in whole multiples of $1,000 in excess thereof.

            (iv) No partial prepayment during any period in which an Event of
      Default shall have occurred and be continuing.

            (v) Any partial prepayment of the Principal Amount, including,
      without limitation, Unscheduled Payments, shall be applied to the
      installments of principal last due hereunder and shall not release or
      relieve Borrower from the obligation to pay the regularly scheduled
      installments of principal and interest becoming due under the Note.

            (vi) Borrower shall pay to Lender, together with any such prepayment
      permitted under this paragraph (c) made prior to the Lockout Expiration
      Date and all other amounts due in connection therewith, the Yield
      Maintenance Premium. For the purposes hereof, the term "Yield Maintenance
      Premium" shall mean the premium which shall be the product of (A) a
      fraction, the numerator of which is the positive excess, if any, of (1)
      the present value of all future payments of principal and interest due
      pursuant to the Note, including the principal amount due at maturity, to
      be made on the Note before the prepayment in question, discounted at an
      interest rate per annum equal to the average yield for "This Week" as
      reported by the Federal Reserve Board in Federal Reserve Statistical
      Release H.15 (519) (the "Treasury Constant Maturity Yield Index")
      published during the second full week preceding the date on which such
      premium is payable for instruments having a maturity coterminous with the
      Lockout Expiration Date, over (2) the Principal Amount evidenced by the
      Note immediately before such prepayment, and the denominator of which is
      the Principal Amount evidenced by the Note immediately prior to the
      prepayment, and (B) the Principal Amount evidenced by the Note being
      prepaid; provided, however, that if there is no Treasury Constant Maturity
      Yield Index for instruments having a maturity coterminous with the Lockout
      Expiration Date, then the index referred to in (1) above shall be equal to
      the weighted average yield to maturity of the Treasury Constant Maturity
      Yield Indices with maturities next longer and shorter than such remaining
      average life to maturity, calculated by averaging (and rounding upward to
      the nearest whole multiple of 1/100 of 1% per annum, if the average is not
      such a multiple) the yields of the relevant Treasury Constant Maturity
      Yield Indices (rounded, if necessary, to the nearest 1/100 of 1% with any
      figure of 1/200 of 1% or above rounded upward).

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      (d) Borrower shall have the right to revoke any notice of prepayment or
defeasance twice during the term of the Loan by giving Lender not less than two
(2) Business Days prior written notice of such revocation, provided that
Borrower shall pay any and all costs and expenses, including, but not limited
to, breakage costs, incurred by Lender in connection with any such revocation.

      Section 15.02. Release of Property. If (A) Borrower defeases all or a
portion of the Loan pursuant to Section 15.01(b) hereof to facilitate the
disposition of the Cross-collateralized Properties or in connection with any
other customary transaction within the meaning of Treas. Reg. 1.860
G-(2)(a)(8)(iii) or (B) Borrower makes a prepayment pursuant to Section 15.01(c)
hereof or (C) Borrower applies Loss Proceeds from the Cross-collateralized
Properties towards the repayment of the Debt or towards a defeasance, Lender
shall, promptly, upon satisfaction of all the following terms and conditions,
execute, acknowledge and deliver to Borrower a release of this Security
Instrument (a "Release") in recordable form with respect to the
Cross-collateralized Properties:

      (a) In the event of a prepayment or defeasance of the Loan in part, but
not in whole, Borrower shall have defeased or prepaid, as applicable, a
principal amount equal to one hundred-twenty percent (120%) of the Allocated
Loan Amount for the Cross-collateralized Property to be released (the "Release
Price").

      (b) In the event of a prepayment pursuant to Section 15.01(c) hereof or
defeasance pursuant to Section 15.01(b) hereof, Lender shall have received from
Borrower evidence in form and substance satisfactory to Lender that the pro
forma Debt Yield immediately following the Release is at least equal to 8.50%,
accompanied by an Officer's Certificate stating that the statements,
calculations and information comprising such evidence are true, correct and
complete in all respects.

      (c) Borrower shall, at its sole cost and expense, prepare any and all
documents and instruments necessary to effect the Release, all of which shall be
subject to the reasonable approval of Lender, and Borrower shall pay all costs
reasonably incurred by Lender (including, but not limited to, reasonable
attorneys' fees and disbursements, title search costs and endorsement premiums)
in connection with the review, execution and delivery of the Release.

      (d) No Event of Default has occurred and is continuing or shall result as
a consequence of the Release.

      (e) Borrower shall continue to be in compliance with the provisions of
Section 2.02(g) hereof.

      Notwithstanding anything contained herein, the Golf Premises may only be
the subject of a Release if such Release is made simultaneously with a Release
of either the JW Premises or the Ritz Premises and the record owner of the Golf
Premises enters into an access agreement in form and substance acceptable to
Lender with the owner of the portion of the Cross-collateralized Property which
is not the subject of the Release (the "Remaining Property") permitting access
to

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      the owner of the Remaining Property and guests of the Remaining Property
      on the same terms as prior to the Release.

      Section 15.03 Additional Property. Subject to the terms and conditions set
forth in this Section 15.03, Borrower shall have the one (1) time right to
spread the lien of this Security Instrument (and the related Loan Documents)
encumbering the Property to encumber all, or a portion of, the real property
more particularly described or depicted in EXHIBIT G attached hereto and made a
part hereof (the "Additional Collateral") subject to the satisfaction of the
following conditions precedent:

      (a) No Event of Default shall have occurred and be continuing and Lender
shall have received a certificate from Borrower confirming the foregoing.

      (b) Borrower shall have given Lender at least thirty (30) days prior
written notice of its election to acquire the Additional Collateral.

      (c) Borrower shall have paid to Lender a processing fee in an amount equal
to $7,500.

      (d) Lender shall have received a phase 1 environmental report and, if
recommended under the phase 1 environmental report, a phase 2 environmental
report from a nationally recognized environmental consultant approved by Lender
not less than fifteen (15) days prior to such addition, which conclude that the
Additional Property does not contain any Hazardous Materials.

      (e) Lender shall have received (i) a copy of a deed conveying all right,
title and interest in and to the Additional Property to Borrower in a bona fide
arms' length transaction and (ii) a letter from Borrower countersigned by a
title insurance company acknowledging receipt of (1) the deeds and agreeing to
record such deeds in the appropriate real estate records for the county in which
the Additional Property is located and (2) all required transfer taxes or
charges and recording fees or other applicable fees and charges.

      (f) Borrower shall have executed, acknowledged and delivered to Lender (i)
a spreader agreement which spreads the lien of this Security Instrument to the
Additional Property and a UCC financing statement with respect to the Additional
Property, together with a letter from Borrower countersigned by a title
insurance company acknowledging receipt of such spreader agreement and UCC-1
financing statements and agreeing to record or file, as applicable, such
spreader agreement in the real estate records for the county in which the
Additional Property is located and to file the UCC-1 financing statements in the
office of the Secretary of State of the State in which the Borrower is organized
or registered, as applicable, so as to effectively create upon such recording
and filing valid and enforceable liens upon the Additional Property, of first
priority, in favor of Lender, subject only to the Permitted Encumbrances and
such other liens as are permitted pursuant to the Loan Documents, (ii) written
confirmation from each Guarantor regarding such addition, (iii) modifications to
the Loan Documents as Lender deems desirable to properly reflect the addition of
the Additional Property, and (iv) such other

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documents and agreements as reasonably requested to evidence the addition of the
Additional Property.

      (g) Lender shall have received a title insurance policy (or a marked,
signed and redated commitment to issue such title insurance policy) insuring the
lien of the mortgage encumbering the Additional Property, issued by the title
company that issued the title insurance policies insuring the lien of this
Security Instrument and dated as of the date of the addition. The title
insurance policy issued with respect to the Additional Property shall contain
such endorsements and affirmative coverages as are contained in the title
insurance policy insuring the lien of this Security Instrument and name Lender
as the insured. Lender also shall have received copies of paid receipts showing
that all premiums in respect of such endorsements and title insurance policies
have been paid.

      (h) Lender shall have received a current title survey for the Additional
Property, certified to the title company and Lender and their successors and
assigns, in the same form and having the same content as the certification of
the survey of the Property prepared by a professional land surveyor licensed in
the State in which the Additional Property is located and reasonably acceptable
to Lender. Such survey shall reflect the same legal description contained in the
title insurance policy relating to the Additional Property and shall include,
among other things, a metes and bounds description of the real property
comprising part of such Additional Property. The surveyor's seal shall be
affixed to each survey and each survey shall certify that the surveyed property
is not located in a "one-hundred-year flood hazard area."

      (i) Lender shall have received valid certificates of insurance indicating
that the requirements for the policies of insurance required hereunder have been
satisfied with respect to the Additional Property and evidence of the payment of
all premiums payable for the existing policy period.

      (j) Borrower shall deliver or cause to be delivered to Lender (i) updates
certified by Borrower of all organizational documentation related to Borrower
and/or the formation, structure, existence, good standing and/or qualification
to do business delivered to Lender in connection with the origination of the
Loan; (ii) good standing certificates, certificates of qualification to do
business in the State in which the Additional Property is located (if required
in such State) and (iii) if applicable, resolutions of the General Partner
authorizing the actions taken in connection with such addition.

      (k) Lender shall have received the following opinions of Borrower's
counsel, all of which would be in form and substance and delivered by counsel
reasonably acceptable to an Institutional Lender making a loan similar in size
and type to the Loan: (i) an opinion of counsel admitted to practice under the
laws of the State in which the Additional Property is located stating that the
Loan Documents delivered with respect to the Additional Property, pursuant to
clause (f) above are valid and enforceable in accordance with their terms,
subject to the laws applicable to creditors' rights and equitable principles,
and that Borrower is qualified to do business and in good standing under the
laws of the jurisdiction where the Additional Property is located; (ii) an
opinion of counsel stating that the loan documents delivered pursuant to clause
(f) above were duly authorized, executed and delivered by Borrower and that, to
the best of

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Borrower's counsel's knowledge, the execution and delivery of such loan
documents and the performance by Borrower of its obligations thereunder will not
cause a breach of, or a default under, any agreement, document or instrument to
which Borrower is a party or to which it or its properties are bound; and (iii)
such other opinions as an Institutional Lender making a loan similar in size and
type to the Loan would reasonably request.

      (l) No Leases shall affect the Additional Property other than those which
comply with the terms of this Security Instrument.

      (m) Lender shall have received plans and specifications and a fixed price
construction contract for the construction of the club house to be located on
and be a part of the Additional Collateral (the "Club House"), and all other
significant construction documents relating to the construction of the Club
House.

      (n) Lender shall have received evidence that, both prior to and subsequent
to the construction of the Club House, the Property, inclusive of the Additional
Collateral, shall continue to be in compliance with all Development Laws, Use
Requirements and other Legal Requirements.

      (o) Borrower shall cause Guarantor to execute a completion guaranty in
form and substance reasonably satisfactory to Lender guarantying lien-free
completion of the Club House.

      (p) The addition of the Additional Property will not have a Material
Adverse Effect.

      (q) To the extent required, existing Property Agreements shall be modified
to govern the integrated use of the Property, the Additional Property and any
property adjoining the Additional Property.

      (r) Lender shall have received such other and further approvals, opinions,
which may include, without limitation, an opinion of Independent tax counsel to
the effect that the contemplated addition of the Additional Collateral would not
adversely affect the federal income tax status as REMIC, trust or other vehicle
in which the Loan may be included, will not result in a deemed exchange of the
Note pursuant to Section 1001 of the Code and will not adversely affect the
Note's status as indebtedness for federal income tax purposes, documents and
information in connection with the acquisition as an Institutional Lender making
a loan similar in size and type to the Loan would have reasonably requested.

      (s) Borrower shall have paid or reimbursed Lender for all third party
out-of-pocket costs and expenses incurred by Lender (including, without
limitation, reasonable attorneys fees and disbursements) in connection with the
acquisition and Borrower shall have paid any Ratings Agency fees, recording
charges, filing fees, taxes and other expenses (including, without limitation,
mortgage and intangibles taxes and documentary stamp taxes) payable in
connection with the acquisition.

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      (t) On or prior to the date of acquisition, Borrower shall deliver an
Officer's Certificate dated as of the date of such acquisition certifying that
the requirements set forth in this Section 15.03 have been satisfied.

      (u) All of the items set forth in (a) through (t) above shall be in form
and substance reasonably acceptable to an Institutional Lender making a loan
similar in size and type to the Loan.

                     ARTICLE XVI: ENVIRONMENTAL COMPLIANCE

      Section 16.01. Covenants, Representations and Warranties. (a) Borrower has
not, at any time, and, to Borrower's best knowledge after due inquiry and
investigation, except as set forth in the Environmental Report, no other Person
has at any time, handled, buried, stored, retained, refined, transported,
processed, manufactured, generated, produced, spilled, allowed to seep, leak,
escape or leach, or pumped, poured, emitted, emptied, discharged, injected,
dumped, transferred or otherwise disposed of or dealt with Hazardous Materials
on, to or from the Premises or any other real property owned and/or occupied by
Borrower, and Borrower does not intend to and shall not use the Property or any
part thereof or any such other real property for the purpose of handling,
burying, storing, retaining, refining, transporting, processing, manufacturing,
generating, producing, spilling, seeping, leaking, escaping, leaching, pumping,
pouring, emitting, emptying, discharging, injecting, dumping, transferring or
otherwise disposing of or dealing with Hazardous Materials, except for use and
storage for use of heating oil, cleaning fluids, pesticides and other substances
customarily used in the operation of properties that are being used for the same
purposes as the Property is presently being used, provided such use and/or
storage for use is in compliance with the requirements hereof and the other Loan
Documents and does not give rise to liability under applicable Legal
Requirements or Environmental Statutes or be the basis for a lien against the
Property or any part thereof. In addition, without limitation to the foregoing
provisions, Borrower represents and warrants that, to the best of its knowledge,
after due inquiry and investigation, except as previously disclosed in writing
to Lender, there is no asbestos in, on, over, or under all or any portion of the
fire-proofing or any other portion of the Property.

      (b) Borrower, after due inquiry and investigation, knows of no seepage,
leak, escape, leach, discharge, injection, release, emission, spill, pumping,
pouring, emptying or dumping of Hazardous Materials into waters on, under or
adjacent to the Property or any part thereof or any other real property owned
and/or occupied by Borrower, or onto lands from which such Hazardous Materials
might seep, flow or drain into such waters, except as disclosed in the
Environmental Report.

      (c) Borrower shall not permit any Hazardous Materials to be handled,
buried, stored, retained, refined, transported, processed, manufactured,
generated, produced, spilled, allowed to seep, leak, escape or leach, or to be
pumped, poured, emitted, emptied, discharged, injected, dumped, transferred or
otherwise disposed of or dealt with on, under, to or from the Property or any
portion thereof at any time, except for use and storage for use of heating oil,
ordinary cleaning fluids, pesticides and other substances customarily used in
the operation of properties that are being used for the same purposes as the
Property is presently being used, provided such

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<PAGE>

use and/or storage for use is in compliance with the requirements hereof and the
other Loan Documents and does not give rise to liability under applicable Legal
Requirements or be the basis for a lien against the Property or any part
thereof.

      (d) Borrower represents and warrants that no actions, suits, or
proceedings have been commenced, or are pending, or to the best knowledge of
Borrower, are threatened with respect to any Legal Requirement governing the
use, manufacture, storage, treatment, transportation, or processing of Hazardous
Materials with respect to the Property or any part thereof. Borrower has
received no notice of, and, except as disclosed in the Environmental Report,
after due inquiry, has no knowledge of any fact, condition, occurrence or
circumstance which with notice or passage of time or both would give rise to a
claim under or pursuant to any Environmental Statute pertaining to Hazardous
Materials on, in, under or originating from the Property or any part thereof or
any other real property owned or occupied by Borrower or arising out of the
conduct of Borrower, including, without limitation, pursuant to any
Environmental Statute.

      (e) Borrower has not waived any Person's liability with regard to
Hazardous Materials in, on, under or around the Property, nor has Borrower
retained or assumed, contractually or by operation of law, any other Person's
liability relative to Hazardous Materials or any claim, action or proceeding
relating thereto.

      (f) In the event that there shall be filed a lien against the Property or
any part thereof pursuant to any Environmental Statute pertaining to Hazardous
Materials, Borrower shall, within sixty (60) days or, in the event that the
applicable Governmental Authority has commenced steps to cause the Premises or
any part thereof to be sold pursuant to the lien, within fifteen (15) days, from
the date that Borrower receives notice of such lien, either (i) pay the claim
and remove the lien from the Property, or (ii) furnish (A) a bond satisfactory
to Lender in the amount of the claim out of which the lien arises, (B) a cash
deposit in the amount of the claim out of which the lien arises, or (C) other
security reasonably satisfactory to Lender in an amount sufficient to discharge
the claim out of which the lien arises.

      (g) Borrower represents and warrants that (i) except as disclosed in the
Environmental Report, Borrower has no knowledge of any violation of any
Environmental Statute or any Environmental Problem in connection with the
Property, nor has Borrower been requested or required by any Governmental
Authority to perform any remedial activity or other responsive action in
connection with any Environmental Problem and (ii) neither the Property nor any
other property owned by Borrower is included or, to Borrower's best knowledge,
after due inquiry and investigation, proposed for inclusion on the National
Priorities List issued pursuant to CERCLA by the United States Environmental
Protection Agency (the "EPA") or on the inventory of other potential "Problem"
sites issued by the EPA or has been identified by the EPA as a potential CERCLA
site or included or, to Borrower's knowledge, after due inquiry and
investigation, proposed for inclusion on any list or inventory issued pursuant
to any other Environmental Statute, if any, or issued by any other Governmental
Authority. Borrower covenants that Borrower will comply with all Environmental
Statutes affecting or imposed upon Borrower or the Property.

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<PAGE>

      (h) Borrower covenants that it shall promptly notify Lender of the
presence and/or release of any Hazardous Materials and of any request for
information or any inspection of the Property or any part thereof by any
Governmental Authority with respect to any Hazardous Materials and provide
Lender with copies of such request and any response to any such request or
inspection. Borrower covenants that it shall, in compliance with applicable
Legal Requirements, conduct and complete all investigations, studies, sampling
and testing (and promptly shall provide Lender with copies of any such studies
and the results of any such test) and all remedial, removal and other actions
necessary to clean up and remove all Hazardous Materials in, on, over, under,
from or affecting the Property or any part thereof in accordance with all such
Legal Requirements applicable to the Property or any part thereof to the
satisfaction of Lender.

      (i) Following the occurrence of an Event of Default hereunder, and without
regard to whether Lender shall have taken possession of the Property or a
receiver has been requested or appointed or any other right or remedy of Lender
has or may be exercised hereunder or under any other Loan Document, Lender shall
have the right (but no obligation) to conduct such investigations, studies,
sampling and/or testing of the Property or any part thereof as Lender may, in
its discretion, determine to conduct, relative to Hazardous Materials. All costs
and expenses incurred in connection therewith including, without limitation,
consultants' fees and disbursements and laboratory fees, shall constitute a part
of the Debt and shall, upon demand by Lender, be immediately due and payable and
shall bear interest at the Default Rate from the date so demanded by Lender
until reimbursed. Borrower shall, at its sole cost and expense, fully and
expeditiously cooperate in all such investigations, studies, samplings and/or
testings including, without limitation, providing all relevant information and
making knowledgeable people available for interviews.

      (j) Borrower represents and warrants that all paint and painted surfaces
existing within the interior or on the exterior of the Improvements are not
flaking, peeling, cracking, blistering, or chipping, and do not contain lead or
are maintained in a condition that prevents exposure of young children to
lead-based paint, as of the date hereof, and that the current inspections,
operation, and maintenance program at the Property with respect to lead-based
paint is consistent with FNMA guidelines and sufficient to ensure that all
painted surfaces within the Property shall be maintained in a condition that
prevents exposure of tenants to lead-based paint. To Borrower's knowledge, there
have been no claims for adverse health effects from exposure on the Property to
lead-based paint or requests for the investigation, assessment or removal of
lead-based paint at the Property.

      (k) Borrower represents and warrants that except in accordance with all
applicable Environmental Statutes and as disclosed in the Environmental Report,
(i) no underground treatment or storage tanks or pumps or water, gas, or oil
wells are or have been located about the Property, (ii) no PCBs or transformers,
capacitors, ballasts or other equipment that contain dielectric fluid containing
PCBs are located about the Property, (iii) no insulating material containing
urea formaldehyde is located about the Property and (iv) no asbestos-containing
material is located about the Property.

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      Section 16.02. Environmental Indemnification. Borrower shall defend,
indemnify and hold harmless the Indemnified Parties for, from and against any
claims, demands, penalties, fines, liabilities, settlements, damages, costs and
expenses of whatever kind or nature, known or unknown, contingent or otherwise,
whether incurred or imposed within or outside the judicial process, including,
without limitation, reasonable attorneys' and consultants' fees and
disbursements and investigations and laboratory fees arising out of, or in any
way related to any Environmental Problem, including without limitation:

      (a) the presence, disposal, escape, seepage, leakage, spillage, discharge,
emission, release or threat of release of any Hazardous Materials in, on, over,
under, from or affecting the Property or any part thereof whether or not
disclosed by the Environmental Report;

      (b) any personal injury (including wrongful death, disease or other health
condition related to or caused by, in whole or in part, any Hazardous Materials)
or property damage (real or personal) arising out of or related to any Hazardous
Materials in, on, over, under, from or affecting the Property or any part
thereof whether or not disclosed by the Environmental Report;

      (c) any action, suit or proceeding brought or threatened, settlement
reached, or order of any Governmental Authority relating to such Hazardous
Material whether or not disclosed by the Environmental Report; and/or

      (d) any violation of the provisions, covenants, representations or
warranties of Section 16.01 hereof or of any Legal Requirement which is based on
or in any way related to any Hazardous Materials in, on, over, under, from or
affecting the Property or any part thereof including, without limitation, the
cost of any work performed and materials furnished in order to comply therewith
whether or not disclosed by the Environmental Report.

      Notwithstanding the foregoing provisions of this Section 16.02 to the
contrary, Borrower shall have no obligation to indemnify Lender for liabilities,
claims, damages, penalties, causes of action, costs and expenses relative to the
foregoing which result directly from Lender's willful misconduct or gross
negligence. Any amounts payable to Lender by reason of the application of this
Section 16.02 shall be secured by this Security Instrument and shall, upon
demand by Lender, become immediately due and payable and shall bear interest at
the Default Rate from the date so demanded by Lender until paid.

      This indemnification shall survive the termination of this Security
Instrument whether by repayment of the Debt, foreclosure or deed in lieu
thereof, assignment, or otherwise. The indemnity provided for in this Section
16.02 shall not be included in any exculpation of Borrower or its principals
from personal liability provided for in this Security Instrument or in any of
the other Loan Documents. Nothing in this Section 16.02 shall be deemed to
deprive Lender of any rights or remedies otherwise available to Lender,
including, without limitation, those rights and remedies provided elsewhere in
this Security Instrument or the other Loan Documents.

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<PAGE>

                           ARTICLE XVII: ASSIGNMENTS

      Section 17.01. Participations and Assignments. Lender shall have the right
to assign this Security Instrument and/or any of the Loan Documents, and to
transfer, assign or sell participations and subparticipations (including blind
or undisclosed participations and subparticipations) in the Loan Documents and
the obligations hereunder to any Person; provided, however, that no such
participation shall increase, decrease or otherwise affect either Borrower's or
Lender's obligations under this Security Instrument or the other Loan Documents.

                          ARTICLE XVIII: MISCELLANEOUS

      Section 18.01. Right of Entry. Lender and its agents shall have the right
to enter and inspect the Property or any part thereof at all reasonable times,
and, except in the event of an emergency, upon reasonable notice and to inspect
Borrower's books and records and to make abstracts and reproductions thereof.

      Section 18.02. Cumulative Rights. The rights of Lender under this Security
Instrument shall be separate, distinct and cumulative and none shall be given
effect to the exclusion of the others. No act of Lender shall be construed as an
election to proceed under any one provision herein to the exclusion of any other
provision. Lender shall not be limited exclusively to the rights and remedies
herein stated but shall be entitled, subject to the terms of this Security
Instrument, to every right and remedy now or hereafter afforded by law.

      Section 18.03. Liability. If Borrower consists of more than one Person,
the obligations and liabilities of each such Person hereunder shall be joint and
several.

      Section 18.04. Exhibits Incorporated. The information set forth on the
cover hereof, and the Exhibits annexed hereto, are hereby incorporated herein as
a part of this Security Instrument with the same effect as if set forth in the
body hereof.

      Section 18.05. Severable Provisions. If any term, covenant or condition of
the Loan Documents including, without limitation, the Note or this Security
Instrument, is held to be invalid, illegal or unenforceable in any respect, such
Loan Document shall be construed without such provision.

      Section 18.06. Duplicate Originals. This Security Instrument may be
executed in any number of duplicate originals and each such duplicate original
shall be deemed to constitute but one and the same instrument.

      Section 18.07. No Oral Change. The terms of this Security Instrument,
together with the terms of the Note and the other Loan Documents constitute the
entire understanding and agreement of the parties hereto and supersede all prior
agreements, understandings and negotiations between Borrower and Lender with
respect to the Loan. This Security Instrument, and any provisions hereof, may
not be modified, amended, waived, extended, changed, discharged or terminated
orally or by any act on the part of Borrower or Lender, but only by an

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agreement in writing signed by the party against whom enforcement of any
modification, amendment, waiver, extension, change, discharge or termination is
sought.

      Section 18.08. Waiver of Counterclaim, Etc. BORROWER HEREBY WAIVES THE
RIGHT TO ASSERT A COUNTERCLAIM, OTHER THAN A COMPULSORY COUNTERCLAIM, IN ANY
ACTION OR PROCEEDING BROUGHT AGAINST IT BY LENDER OR ITS AGENTS, AND WAIVES
TRIAL BY JURY IN ANY ACTION OR PROCEEDING BROUGHT BY EITHER PARTY HERETO AGAINST
THE OTHER OR IN ANY COUNTERCLAIM BORROWER MAY BE PERMITTED TO ASSERT HEREUNDER
OR WHICH MAY BE ASSERTED BY LENDER OR ITS AGENTS, AGAINST BORROWER, OR IN ANY
MATTERS WHATSOEVER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THIS SECURITY
INSTRUMENT OR THE DEBT.

      Section 18.09. Headings; Construction of Documents; etc. The table of
contents, headings and captions of various paragraphs of this Security
Instrument are for convenience of reference only and are not to be construed as
defining or limiting, in any way, the scope or intent of the provisions hereof.
Borrower acknowledges that it was represented by competent counsel in connection
with the negotiation and drafting of this Security Instrument and the other Loan
Documents and that neither this Security Instrument nor the other Loan Documents
shall be subject to the principle of construing the meaning against the Person
who drafted same.

      Section 18.10. Sole Discretion of Lender. Whenever Lender exercises any
right given to it to approve or disapprove, or any arrangement or term is to be
satisfactory to Lender, the decision of Lender to approve or disapprove or to
decide that arrangements or terms are satisfactory or not satisfactory shall be
in the sole discretion of Lender and shall be final and conclusive, except as
may be otherwise specifically provided herein.

      Section 18.11. Waiver of Notice. Borrower shall not be entitled to any
notices of any nature whatsoever from Lender except with respect to matters for
which this Security Instrument specifically and expressly provides for the
giving of notice by Lender to Borrower and except with respect to matters for
which Borrower is not, pursuant to applicable Legal Requirements, permitted to
waive the giving of notice.

      Section 18.12. Covenants Run with the Land. All of the grants, covenants,
terms, provisions and conditions herein shall run with the Premises, shall be
binding upon Borrower and shall inure to the benefit of Lender, subsequent
holders of this Security Instrument and their successors and assigns. Without
limitation to any provision hereof, the term "Borrower" shall include and refer
to the borrower named herein, any subsequent owner of the Property, and its
respective heirs, executors, legal representatives, successors and assigns. The
representations, warranties and agreements contained in this Security Instrument
and the other Loan Documents are intended solely for the benefit of the parties
hereto, shall confer no rights hereunder, whether legal or equitable, in any
other Person and no other Person shall be entitled to rely thereon.

      Section 18.13. Applicable Law. THIS SECURITY INSTRUMENT AND THE
OBLIGATIONS ARISING HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF FLORIDA APPLICABLE TO

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CONTRACTS MADE AND PERFORMED IN SUCH STATE AND ANY APPLICABLE LAW OF THE UNITED
STATES OF AMERICA.

      Section 18.14. Security Agreement. (a) (i) This Security Instrument is
both a real property mortgage, deed to secure debt or deed of trust, as
applicable, and a "security agreement" within the meaning of the UCC. The
Property includes both real and personal property and all other rights and
interests, whether tangible or intangible in nature, of Borrower in the
Property. This Security Instrument is filed as a fixture filing and covers goods
which are or are to become fixtures on the Property. Borrower by executing and
delivering this Security Instrument has granted to Lender, as security for the
Debt, a security interest in the Property to the full extent that the Property
may be subject to the UCC (said portion of the Property so subject to the UCC
being called in this Section 18.14 the "Collateral"). If an Event of Default
shall occur, Lender, in addition to any other rights and remedies which it may
have, shall have and may exercise immediately and without demand, any and all
rights and remedies granted to a secured party upon default under the UCC,
including, without limiting the generality of the foregoing, the right to take
possession of the Collateral or any part thereof, and to take such other
measures as Lender may deem necessary for the care, protection and preservation
of the Collateral. Upon request or demand of Lender following an Event of
Default, Borrower shall, at its expense, assemble the Collateral and make it
available to Lender at a convenient place acceptable to Lender. Borrower shall
pay to Lender on demand any and all expenses, including reasonable legal
expenses and attorneys' fees, incurred or paid by Lender in protecting its
interest in the Collateral and in enforcing its rights hereunder with respect to
the Collateral. Any disposition pursuant to the UCC of so much of the Collateral
as may constitute personal property shall be considered commercially reasonable
if made pursuant to a public sale which is advertised at least twice in a
newspaper in which sheriff's sales are advertised in the county where the
Premises is located. Any notice of sale, disposition or other intended action by
Lender with respect to the Collateral given to Borrower in accordance with the
provisions hereof at least ten (10) days prior to such action, shall constitute
reasonable notice to Borrower. The proceeds of any disposition of the
Collateral, or any part thereof, may be applied by Lender to the payment of the
Debt in such priority and proportions as Lender in its discretion shall deem
proper. It is not necessary that the Collateral be present at any disposition
thereof. Lender shall have no obligation to clean-up or otherwise prepare the
Collateral for disposition.

         (ii) The mention in a financing statement filed in the records normally
pertaining to personal property of any portion of the Property shall not
derogate from or impair in any manner the intention of this Security Instrument.
Lender hereby declares that all items of Collateral are part of the real
property encumbered hereby to the fullest extent permitted by law, regardless of
whether any such item is physically attached to the Improvements or whether
serial numbers are used for the better identification of certain items.
Specifically, the mention in any such financing statement of any items included
in the Property shall not be construed to alter, impair or impugn any rights of
Lender as determined by this Security Instrument or the priority of Lender's
lien upon and security interest in the Property in the event that notice of
Lender's priority of interest as to any portion of the Property is required to
be filed in accordance with the UCC to be effective against or take priority
over the interest of any particular class of persons,

                                      110
<PAGE>

including the federal government or any subdivision or instrumentality thereof.
No portion of the Collateral constitutes or is the proceeds of "Farm Products",
as defined in the UCC.

         (iii) If Borrower is at any time a beneficiary under a letter of credit
now or hereafter issued in favor of Borrower, Borrower shall promptly notify
Lender thereof and, at the request and option of Lender, Borrower shall,
pursuant to an agreement in form and substance satisfactory to Lender, either
(A) arrange for the issuer and any confirmer of such letter of credit to consent
to an assignment to Lender of the proceeds of any drawing under the letter of
credit or (B) arrange for Lender to become the transferee beneficiary of the
letter of credit, with Lender agreeing, in each case, that the proceeds of any
drawing under the letter to credit are to be applied as provided in this
Security Instrument.

         (iv) Borrower and Lender acknowledge that for the purposes of Article 9
of the UCC, the law of the State of Florida shall be the law of the jurisdiction
of the bank in which the Central Account is located.

         (v) Lender may comply with any applicable Legal Requirements in
connection with the disposition of the Collateral, and Lender's compliance
therewith will not be considered to adversely affect the commercial
reasonableness of any sale of the Collateral.

         (vi) Lender may sell the Collateral without giving any warranties as to
the Collateral. Lender may specifically disclaim any warranties of title,
possession, quiet enjoyment or the like. This procedure will not be considered
to adversely affect the commercial reasonableness of any sale of the Collateral.

         (vii) If Lender sells any of the Collateral upon credit, Borrower will
be credited only with payments actually made by the purchaser, received by
Lender and applied to the indebtedness of Borrower. In the event the purchaser
of the Collateral fails to fully pay for the Collateral, Lender may resell the
Collateral and Borrower will be credited with the proceeds of such sale.

      (b) Borrower hereby irrevocably appoints Lender as its attorney-in-fact,
coupled with an interest, to file with the appropriate public office on its
behalf any financing or other statements signed only by Lender, as secured
party, or, to the extent permitted under the UCC, unsigned, in connection with
the Collateral covered by this Security Instrument.

      Section 18.15. Actions and Proceedings. Lender has the right to appear in
and defend any action or proceeding brought with respect to the Property in its
own name or, if required by Legal Requirements or, if in Lender's reasonable
judgment, it is necessary, in the name and on behalf of Borrower, which Lender
believes will adversely affect the Property or this Security Instrument and to
bring any action or proceedings, in its name or in the name and on behalf of
Borrower, which Lender, in its reasonable discretion, decides should be brought
to protect its interest in the Property.

      Section 18.16. Usury Laws. This Security Instrument and the Note are
subject to the express condition, and it is the expressed intent of the parties,
that at no time shall Borrower be

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obligated or required to pay interest on the principal balance due under the
Note at a rate which could subject the holder of the Note to either civil or
criminal liability as a result of being in excess of the maximum interest rate
which Borrower is permitted by law to contract or agree to pay. If by the terms
of this Security Instrument or the Note, Borrower is at any time required or
obligated to pay interest on the principal balance due under the Note at a rate
in excess of such maximum rate, such rate of interest shall be deemed to be
immediately reduced to such maximum rate and the interest payable shall be
computed at such maximum rate and all prior interest payments in excess of such
maximum rate shall be applied and shall be deemed to have been payments in
reduction of the principal balance of the Note. No application to the principal
balance of the Note pursuant to this Section 18.16 shall give rise to any
requirement to pay any prepayment fee or charge of any kind due hereunder, if
any.

      Section 18.17. Remedies of Borrower. In the event that a claim or
adjudication is made that Lender has acted unreasonably or unreasonably delayed
acting in any case where by law or under the Note, this Security Instrument or
the Loan Documents, it has an obligation to act reasonably or promptly, Lender
shall not be liable for any monetary damages, and Borrower's remedies shall be
limited to injunctive relief or declaratory judgment.

      Section 18.18. Offsets, Counterclaims and Defenses. Any assignee of this
Security Instrument, the Assignment and the Note shall take the same free and
clear of all offsets, counterclaims or defenses which are unrelated to the Note,
the Assignment or this Security Instrument which Borrower may otherwise have
against any assignor of this Security Instrument, the Assignment and the Note
and no such unrelated counterclaim or defense shall be interposed or asserted by
Borrower in any action or proceeding brought by any such assignee upon this
Security Instrument, the Assignment or the Note and any such right to interpose
or assert any such unrelated offset, counterclaim or defense in any such action
or proceeding is hereby expressly waived by Borrower.

      Section 18.19. No Merger. If Borrower's and Lender's estates become the
same including, without limitation, upon the delivery of a deed by Borrower in
lieu of a foreclosure sale, or upon a purchase of the Property by Lender in a
foreclosure sale, this Security Instrument and the lien created hereby shall not
be destroyed or terminated by the application of the doctrine of merger and in
such event Lender shall continue to have and enjoy all of the rights and
privileges of Lender as to the separate estates; and, as a consequence thereof,
upon the foreclosure of the lien created by this Security Instrument, any Leases
or subleases then existing and created by Borrower shall not be destroyed or
terminated by application of the law of merger or as a result of such
foreclosure unless Lender or any purchaser at any such foreclosure sale shall so
elect. No act by or on behalf of Lender or any such purchaser shall constitute a
termination of any Lease or sublease unless Lender or such purchaser shall give
written notice thereof to such lessee or sublessee.

      Section 18.20. Restoration of Rights. In case Lender shall have proceeded
to enforce any right under this Security Instrument by foreclosure sale, entry
or otherwise, and such proceedings shall have been discontinued or abandoned for
any reason or shall have been

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determined adversely, then, in every such case, Borrower and Lender shall be
restored to their former positions and rights hereunder with respect to the
Property subject to the lien hereof.

      Section 18.21. Waiver of Statute of Limitations. The pleadings of any
statute of limitations as a defense to any and all obligations secured by this
Security Instrument are hereby waived to the full extent permitted by Legal
Requirements.

      Section 18.22. Advances. This Security Instrument shall cover any and all
advances made pursuant to the Loan Documents, rearrangements and renewals of the
Debt and all extensions in the time of payment thereof, even though such
advances, extensions or renewals be evidenced by new promissory notes or other
instruments hereafter executed and irrespective of whether filed or recorded.
Likewise, the execution of this Security Instrument shall not impair or affect
any other security which may be given to secure the payment of the Debt, and all
such additional security shall be considered as cumulative. The taking of
additional security, execution of partial releases of the security, or any
extension of time of payment of the Debt shall not diminish the force, effect or
lien of this Security Instrument and shall not affect or impair the liability of
Borrower and shall not affect or impair the liability of any maker, surety, or
endorser for the payment of the Debt.

      Section 18.23. Application of Default Rate Not a Waiver. Application of
the Default Rate shall not be deemed to constitute a waiver of any Default or
Event of Default or any rights or remedies of Lender under this Security
Instrument, any other Loan Document or applicable Legal Requirements, or a
consent to any extension of time for the payment or performance of any
obligation with respect to which the Default Rate may be invoked.

      Section 18.24. Intervening Lien. To the fullest extent permitted by law,
any agreement hereafter made pursuant to this Security Instrument shall be
superior to the rights of the holder of any intervening lien.

      Section 18.25. No Joint Venture or Partnership. Borrower and Lender intend
that the relationship created hereunder be solely that of mortgagor and
mortgagee or grantor and beneficiary or borrower and lender, as the case may be.
Nothing herein is intended to create a joint venture, partnership,
tenancy-in-common, or joint tenancy relationship between Borrower and Lender nor
to grant Lender any interest in the Property other than that of mortgagee,
beneficiary or lender.

      Section 18.26. Time of the Essence. Time shall be of the essence in the
performance of all obligations of Borrower hereunder.

      Section 18.27. Borrower's Obligations Absolute. Borrower acknowledges that
Lender and/or certain Affiliates of Lender are engaged in the business of
financing, owning, operating, leasing, managing, and brokering real estate and
in other business ventures which may be viewed as adverse to or competitive with
the business, prospect, profits, operations or condition (financial or
otherwise) of Borrower. Except as set forth to the contrary in the Loan
Documents, all sums payable by Borrower hereunder shall be paid without notice
or demand, counterclaim, set-off, deduction or defense and without abatement,
suspension, deferment, diminution or

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reduction, and the obligations and liabilities of Borrower hereunder shall in no
way be released, discharged, or otherwise affected (except as expressly provided
herein) by reason of: (a) any damage to or destruction of or any Taking of the
Property or any portion thereof or any other Cross-collateralized Property; (b)
any restriction or prevention of or interference with any use of the Property or
any portion thereof or any other Cross-collateralized Property; (c) any title
defect or encumbrance or any eviction from the Premises or any portion thereof
by title paramount or otherwise; (d) any bankruptcy proceeding relating to
Borrower, any General Partner, or any guarantor or indemnitor, or any action
taken with respect to this Security Instrument or any other Loan Document by any
trustee or receiver of Borrower or any other Cross-collateralized Borrower or
any such General Partner, guarantor or indemnitor, or by any court, in any such
proceeding; (e) any claim which Borrower has or might have against Lender; (f)
any default or failure on the part of Lender to perform or comply with any of
the terms hereof or of any other agreement with Borrower or any other
Cross-collateralized Property; or (g) any other occurrence whatsoever, whether
similar or dissimilar to the foregoing, whether or not Borrower shall have
notice or knowledge of any of the foregoing.

      Section 18.28. Publicity. All promotional news releases, publicity or
advertising by Manager, Borrower or their respective Affiliates through any
media intended to reach the general public shall not refer to the Loan Documents
or the financing evidenced by the Loan Documents, or to Lender or to any of its
Affiliates without the prior written approval of Lender or such Affiliate, as
applicable, in each instance, such approval not to be unreasonably withheld or
delayed. Lender shall be authorized to provide information relating to the
Property, the Loan and matters relating thereto to rating agencies,
underwriters, potential securities investors, auditors, regulatory authorities
and to any Persons which may be entitled to such information by operation of law
and may use basic transaction information (including, without limitation, the
name of Borrower, the name and address of the Property and the Loan Amount) in
press releases or other marketing materials.

      Section 18.29. Securitization Opinions. In the event the Loan is included
as an asset of a Securitization by Lender or any of its Affiliates, Borrower
shall, within ten (10) Business Days after Lender's written request therefor, at
Borrower's sole cost and expense (provided that Borrower shall not be required
to incur any expenses, when combined with any expenses incurred pursuant to
Sections 18.30 and 18.31 hereof, in excess of $2,300,000), deliver opinions in
form and substance and delivered by counsel reasonably acceptable to Lender and
each Rating Agency, as may be reasonably required by Lender and/or the Rating
Agency in connection with such securitization. Borrower's failure to deliver the
opinions required hereby within such ten (10) Business Day period (or such
longer period of time to which Lender in its reasonable discretion may agree)
shall constitute an "Event of Default" hereunder.

      Section 18.30. Cooperation with Rating Agencies; etc. Borrower covenants
and agrees that in the event the Loan is to be included as an asset of a
Securitization, Borrower shall (a) gather any information reasonably required by
each Rating Agency in connection with such a Securitization, (b) at Lender's
request, meet with representatives of each Rating Agency to discuss the business
and operations of the Property, and (c) cooperate with the reasonable requests
of each Rating Agency and Lender in connection with all of the foregoing as well
as in
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connection with all other matters and the preparation of any offering documents
with respect thereto, including, without limitation, entering into any
amendments or modifications to this Security Instrument or to any other Loan
Document which may be requested by Lender to conform to Rating Agency or market
standards for a Securitization provided that no such modification shall modify
(a) the interest rate payable under the Note, (b) the stated maturity of the
Note, (c) the amortization of principal under the Note, (d) Section 18.32
hereof, (e) any other material economic term of the Loan or (f) any provision,
the effect of which would materially increase Borrower's obligations or
materially decrease Borrower's rights under the Loan Documents. Borrower
acknowledges that the information provided by Borrower to Lender may be
incorporated into the offering documents for a Securitization and to the fullest
extent permitted, Borrower irrevocably waives all rights, if any, to prohibit
such disclosures including, without limitation, any right of privacy. Lender and
each Rating Agency shall be entitled to rely on the information supplied by, or
on behalf of, Borrower and Borrower indemnifies and holds harmless the
Indemnified Parties, their Affiliates and each Person who controls such Persons
within the meaning of Section 15 of the Securities Act or Section 20 of the
Securities Exchange Act of 1934, as same may be amended from time to time, for,
from and against any claims, demands, penalties, fines, liabilities,
settlements, damages, costs and expenses of whatever kind or nature, known or
unknown, contingent or otherwise, whether incurred or imposed within or outside
the judicial process, including, without limitation, reasonable attorneys' fees
and disbursements that arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in such information or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated in such information or necessary in order
to make the statements in such information, or in light of the circumstances
under which they were made, not misleading. Borrower shall pay all origination
costs and all out-of-pocket costs and expenses incurred by Lender (or any
Affiliate of Lender) with respect to the initial sale of a participation
interest in the Loan by Lender to other Persons and all other initial
syndications of the Loan by Lender (whether such sale(s) or syndication(s) occur
on or after the Closing Date) and the Securitization of the Loan by Lender or
its Affiliates, including, without limitation, costs of agreed-upon-procedures,
duplication and printing costs, travel expenses, costs of preparation of
environmental, seismic and engineering reports, costs of credit reports, costs
of appraisals, accounting and consulting costs, legal fees, costs of
preparation, negotiation, execution and delivery of the commitment letter for
the Loan, this Security Instrument and the other Loan Documents and the
documents executed in connection with a Securitization, rating agency fees (both
initial and ongoing surveillance and administration fees), trustee and special
servicer fees allocable to the Loan, and the costs of consummation of the
transactions contemplated hereby and thereby (including reasonable attorneys'
fees and disbursements in connection therewith and in connection with Lender's
due diligence), mortgage recording taxes and other document filing fees and any
other reasonable out-of-pocket expenses relating to credit and collateral
evaluations (provided that Borrower shall not be required to incur any expenses,
when combined with any expenses incurred pursuant to Sections 18.29 and 18.31
hereof, in excess of $2,300,000).

      Section 18.31. Securitization Financials. Borrower covenants and agrees
that, upon Lender's written request therefor in connection with a
Securitization, Borrower shall, at Borrower's sole cost and expense (provided
that Borrower shall not be required to incur any

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<PAGE>

expenses, when combined with any expenses incurred pursuant to Sections 18.29
and 18.30 hereof, in excess of $2,300,000), promptly deliver (a) audited
financial statements and related documentation prepared by an Independent
certified public accountant that satisfy securities laws and requirements for
use in a public registration statement (which may include up to three (3) years
of historical audited financial statements, if applicable) and (b) if, at the
time one or more Disclosure Documents are being prepared in connection with a
Securitization, Lender expects that Borrower alone or Borrower and one or more
of its Affiliates collectively, or the Property alone or the Property and any
other parcel(s) of real property, together with improvements thereon and
personal property related thereto, that is "related", within the meaning of the
definition of Significant Obligor, to the Property (a "Related Property")
collectively, will be a Significant Obligor, Borrower shall furnish to Lender
upon request (i) the selected financial data or, if applicable, net operating
income, required under Item 1112(b)(1) of Regulation AB and meeting the
requirements thereof, if Lender expects that the principal amount of the Loan,
together with any loans made to an Affiliate of Borrower or secured by a Related
Property that is included in a Securitization with the Loan (a "Related Loan"),
as of the cut-off date for such Securitization may, or if the principal amount
of the Loan together with any Related Loans as of the cut-off date for such
Securitization and at any time during which the Loan and any Related Loans are
included in a Securitization does, equal or exceed ten percent (10%) (but less
than twenty percent (20%)) of the aggregate principal amount of all mortgage
loans included or expected to be included, as applicable, in the Securitization
or (ii) the financial statements required under Item 1112(b)(2) of Regulation AB
and meeting the requirements thereof, if Lender expects that the principal
amount of the Loan together with any Related Loans as of the cut-off date for
such Securitization may, or if the principal amount of the Loan together with
any Related Loans as of the cut-off date for such Securitization and at any time
during which the Loan and any Related Loans are included in a Securitization
does, equal or exceed twenty percent (20%) of the aggregate principal amount of
all mortgage loans included or expected to be included, as applicable, in the
Securitization. Such financial data or financial statements shall be furnished
to Lender within ten (10) Business Days after notice from Lender in connection
with the preparation of Disclosure Documents for the Securitization and, with
respect to the data or financial statements required pursuant to clause (b)
hereof, (A) not later than thirty (30) days after the end of each fiscal quarter
of Borrower and (B) not later than seventy-five (75) days after the end of each
Fiscal Year; provided, however, that Borrower shall not be obligated to furnish
financial data or financial statements pursuant to clauses (A) or (B) of this
sentence with respect to any period for which a filing pursuant to the
Securities Exchange Act of 1934 in connection with or relating to the
Securitization is not required.

      Section 18.32. Exculpation. Notwithstanding anything herein or in any
other Loan Document to the contrary, except as otherwise set forth in this
Section 18.32 to the contrary, Lender shall not enforce the liability and
obligation of (a) Borrower (b) any Affiliate of Borrower (including Operating
Tenant), (c) any Person owning directly or indirectly, any legal or beneficial
interest in Borrower or Affiliate of Borrower, or (d) any direct or indirect
partner, member, principal, officer, beneficiary, trustee, advisor, shareholder,
employee, agent, Affiliate or director of any Person described in clauses (a)
through (d) (the Persons described in the foregoing clauses, as the case may be,
are hereinafter referred to as the "Partners") to perform and observe the
obligations contained in this Security Instrument or any of the other Loan

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Documents by any action or proceeding wherein a money judgment shall be sought
against Borrower or the Partners, except that Lender may bring a foreclosure
action, action for specific performance, or other appropriate action or
proceeding (including, without limitation, an action to obtain a deficiency
judgment) solely for the purpose of enabling Lender to realize upon (i)
Borrower's interest in the Property, (ii) the Rent to the extent received by
Borrower or Operating Tenant (or received by their respective Partners or
shareholders) after the occurrence of an Event of Default in contravention to
Article V (or if same had not been paid, that Manager had taken adequate
reserves therefor) (all such Rent being hereinafter referred to as the "Recourse
Distributions") and (iii) any other collateral given to Lender under the Loan
Documents (the collateral described in the foregoing clauses (i) - (iii) is
hereinafter referred to as the "Default Collateral"); provided, however, that
any judgment in any such action or proceeding shall be enforceable against
Borrower and the Partners only to the extent of any such Default Collateral. The
provisions of this Section shall not, however, (a) impair the validity of the
Debt evidenced by the Note or in any way affect or impair the lien of this
Security Instrument or any of the other Loan Documents or the right of Lender to
foreclose this Security Instrument following the occurrence of an Event of
Default; (b) impair the right of Lender to name Borrower as a party defendant in
any action or suit for judicial foreclosure and sale under this Security
Instrument; (c) affect the validity or enforceability of the Note, this Security
Instrument, or any of the other Loan Documents, or impair the right of Lender to
seek a personal judgment against Guarantor; (d) impair the right of Lender to
obtain the appointment of a receiver; (e) impair the enforcement of the
Assignment; (f) impair the right of Lender to bring suit for a monetary judgment
with respect to fraud or material misrepresentation by Borrower, or any other
Person in connection with this Security Instrument, the Note or the other Loan
Documents, and the foregoing provisions shall not modify, diminish or discharge
the liability of Borrower or the Partners with respect to same; (g) impair the
right of Lender to bring suit for a monetary judgment to obtain the Recourse
Distributions received by Borrower including, without limitation, the right to
bring suit for a monetary judgment to proceed against any Partner, to the extent
of any such Recourse Distributions theretofore distributed to and received by
such Partner, and the foregoing provisions shall not modify, diminish or
discharge the liability of Borrower or the Partners with respect to same; (h)
impair the right of Lender to bring suit for a monetary judgment with respect to
Borrower's misappropriation of tenant security deposits or Rent, and the
foregoing provisions shall not modify, diminish or discharge the liability of
Borrower or the Partners with respect to same; (i) impair the right of Lender to
obtain Loss Proceeds due to Lender pursuant to this Security Instrument; (j)
impair the right of Lender to enforce the provisions of Sections 2.02(g), 12.01,
16.01, 16.02, 18.30 or 18.31, inclusive of this Security Instrument, even after
repayment in full by Borrower of the Debt or to bring suit for a monetary
judgment against Borrower or the Partners with respect to any obligation set
forth in said Sections; (k) prevent or in any way hinder Lender from exercising,
or constitute a defense, or counterclaim, or other basis for relief in respect
of the exercise of, any other remedy against any or all of the collateral
securing the Note as provided in the Loan Documents; (l) impair the right of
Lender to bring suit for a monetary judgment with respect to any misapplication
or conversion of Loss Proceeds, and the foregoing provisions shall not modify,
diminish or discharge the liability of Borrower or the Partners with respect to
same; (m) impair the right of Lender to sue for, seek or demand a deficiency
judgment against Borrower solely for the purpose of foreclosing the Property or
any part thereof, or realizing upon the Default Collateral; provided, however,
that any such deficiency judgment

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referred to in this clause (m) shall be enforceable against Borrower and the
Partners (but only to the extent distributed to and actually received by such
Partner) only to the extent of any of the Default Collateral; (n) impair the
ability of Lender to bring suit for a monetary judgment with respect to waste,
arson or physical damage to or of the Property; (o) impair the right of Lender
to bring a suit for a monetary judgment in the event of the exercise of any
right or remedy under any federal, state or local forfeiture laws resulting in
the loss of the lien of this Security Instrument, or the priority thereof,
against the Property; (p) be deemed a waiver of any right which Lender may have
under Sections 506(a), 506(b), 1111(b) or any other provision of the Bankruptcy
Code to file a claim for the full amount of the Debt or to require that all
collateral shall continue to secure all of the Debt; (q) impair the right of
Lender to bring suit for monetary judgment with respect to any losses resulting
from any claims, actions or proceedings initiated by Borrower (or any Affiliate
of Borrower) alleging that the relationship of Borrower and Lender is that of
joint venturers, partners, tenants in common, joint tenants or any relationship
other than that of debtor and creditor; (r) impair the right of Lender to bring
suit for a monetary judgment for actual damages in the event that Borrower moves
its principal place of business or its books and records relating to the
Property which are governed by the UCC, or changes its name, its jurisdiction of
organization, type of organization or other legal structure or, if it has one,
organizational identification number, without first giving Lender thirty (30)
days prior written notice, (s) impair the right of Lender to bring suit for a
monetary judgment for actual damages in the event that Borrower changes its name
of otherwise does anything which would make the information set forth in any UCC
Financing Statements relating to the Property materially misleading without
giving Lender thirty (30) days prior written notice thereof or (t) impair the
right of Lender to bring suit for a monetary judgment for actual damages in the
event Borrower or any Affiliate contests or in any material way interferes with,
directly or indirectly (collectively, a "Contest") any foreclosure action, UCC
sale or other material remedy exercised by Lender upon the occurrence of any
Event of Default whether by making any motion, bringing any counterclaim,
claiming any defense, seeking any injunction or other restraint, commencing any
action, or otherwise (provided that if any such Person obtains a non-appealable
order successfully asserting a Contest, Borrower shall have no liability under
this clause (t)). The provisions of this Section 18.32 shall be inapplicable to
Borrower if (a) any Transfer occurs in violation of Article IX hereof or (b) any
proceeding, action, petition or filing under the Bankruptcy Code, or any similar
state or federal law now or hereafter in effect relating to bankruptcy,
reorganization or insolvency, or the arrangement or adjustment of debts, shall
be filed by, consented to or acquiesced in by or with respect to Borrower, or if
Borrower shall institute any proceeding for its dissolution or liquidation, or
shall make an assignment for the benefit of creditors, in which event Lender
shall have recourse against all of the assets of Borrower including, without
limitation, any right, title and interest of Borrower in and to the Property,
any partnership interests in Borrower and any Recourse Distributions received by
the Partners of Borrower (but excluding the other assets of such Partners to the
extent Lender would not have had recourse thereto other than in accordance with
the provisions of this Section 18.32).

      Section 18.33. Component Notes. Lender, without in any way limiting
Lender's other rights hereunder, in its sole and absolute discretion, shall have
the right at any time to require Borrower to execute and deliver "component"
notes (including senior and junior notes), which notes may be paid in such order
of priority as may be designated by Lender, provided that (a) the

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aggregate principal amount of such "component" notes shall equal the outstanding
principal balance of the Loan immediately prior to the creation of such
"component" notes, (b) the weighted average interest rate of all such
"component" notes shall on the date created equal the interest rate which was
applicable to the Loan immediately prior to the creation of such "component"
notes, (c) the debt service payments on all such "component" notes shall on the
date created equal the debt service payment which was and would be due under the
Loan immediately prior to the creation of such component notes (it being
acknowledged by Borrower that if an Event of Default occurs during the term of
the Loan, whether or not it is subsequently cured, the weighted average interest
rates of the "component" notes may increase (i.e. the Loan may have "rate
creep")) and (d) the other terms and provisions of each of the "component" notes
shall be identical in substance and substantially similar in form to the Loan
Documents. Borrower shall cooperate with all reasonable requests of Lender in
order to establish the "component" notes and shall execute and deliver such
documents as shall reasonably be required by Lender in connection therewith, all
in form and substance reasonably satisfactory to Lender, including, without
limitation, the severance of security documents if requested. It shall be an
Event of Default if Borrower fails to comply with any of the terms, covenants or
conditions of this Section 18.33 after the expiration of ten (10) Business Days
after notice thereof.

      Section 18.34. Certain Matters Relating to Property located in the State
of Florida. With respect to the Property which is located in the State of
Florida, notwithstanding anything contained herein to the contrary:

      (a) It is agreed that, in addition to existing indebtedness, any future
advances made by the then holder of the Note to or for the benefit of Borrower
or Borrower's permitted assignees, whether such advances are obligatory or are
made at the option of Lender, or otherwise, at any time within twenty (20) years
from the date of this Security Instrument, with interest thereon at the rate
agreed upon at the time of each additional loan or advance, shall be equally
secured with and have the same priority as the Debt and be subject to all of the
terms and provisions of this Security Instrument, whether or not such additional
loan or advance is evidenced by a promissory note of Borrower and whether or not
identified by a recital that it is secured by this Security Instrument; provided
that, although the total amount of the indebtedness that may be secured may
decrease to zero from time to time or may increase from time to time, the
aggregate amount of outstanding Debt so secured at any one time shall not exceed
the sum of Six Hundred Seventy Million Dollars ($670,000,000), plus interest and
disbursements made for the payment of taxes, levies or insurance on the Property
with interest on such disbursements. It is understood and agreed that this
future advance provision shall not be construed to obligate Lender to make any
such additional loans or advances. It is further agreed that any additional note
or notes executed and delivered under this future advance provision shall be
included in the words "Note" or "Debt" wherever either appears in the context of
this Security Instrument. Borrower, for itself and its successors in title and
its successors and permitted assigns, hereby expressly waives and relinquishes
any rights granted under Section 697.04 of the Florida Statutes, or otherwise,
to limit the amount of indebtedness that may be secured by this Security
Instrument at any time during the term of this Security Instrument. Borrower
further covenants not to file for record any notice limiting the maximum
principal amount that may be secured by this Security Instrument and agrees that
any such notice, if filed, shall be null and void; and

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except as hereinafter provided, of no effect. In the event that, notwithstanding
the foregoing covenant, Borrower or its successor in title files for record any
notice limiting the maximum principal amount that may be secured by this
Security Instrument in violation of the foregoing covenant, the Debt shall, at
the option of Lender, become immediately due and payable.

      (b) Notwithstanding anything to the contrary contained in this Security
Instrument, Lender shall comply with the requirements of Section 501.137.
Florida Statutes, as applicable, with respect to the payment of Impositions and
insurance premiums from the Basic Carrying Costs Sub-Account so that the maximum
tax discount available may be obtained with regard to the Premises and so that
insurance coverage on the Property does not lapse.

      (c) The assignment of leases and rents contained in this Security
Instrument is intended to provide Lender with all the rights and remedies of
lenders pursuant to Section 697.07 of the Florida Statutes (hereinafter "Section
697.07"), as may be amended from time to time. However, in no event shall this
reference diminish, alter, impair, or affect any other rights and remedies of
Lender, including but not limited to, the appointment of a receiver as provided
herein, nor shall any provision in this Section diminish, alter, impair or
affect any rights or powers of the receiver in law or equity or as set forth
herein. In addition, this assignment shall be fully operative without regard to
value of the Property or without regard to the adequacy of the Property to serve
as security for the obligations owed by Borrower to Lender, and shall be in
addition to any rights arising under Section 697.07. Further, except for the
notices required hereunder, if any, Borrower waives any notice of default or
demand for turnover of rents by Lender, together with any rights under Section
697.07 to apply to a court to deposit the Rents into the registry of the court
or such other depository as the court may designate.

                                    * * * * *

                                      120
<PAGE>

      IN WITNESS WHEREOF, Borrower has duly executed this Security Instrument
the day and year first above written.

Borrower's Organizational Identification    CNL GL RESORT, LP, a Delaware
Number: 4098111                             limited partnership

                                            By: CNL GL RESORT GP, LLC, a
                                            Delaware limited liability company,
                                            its general partner

                                                By: /s/ John X. Brady, Jr.
                                                    --------------------------
                                                    Name:  John X. Brady, Jr.
                                                    Title: Vice President

<PAGE>

                                   EXHIBIT A-1

                        Legal Description of JW Premises

Parcel 4, Grande Lakes Resort, according to the plat thereof, as recorded in
Plat Book 58 at Pages 23 through 36, inclusive, of the Public Records of Orange
County, Florida, together with easements appurtenant to said parcels established
by and pursuant to the terms of that certain Declaration of Covenants,
Conditions, Restrictions, Easements and Reservations for Grande Lakes Resort,
Orlando, Florida, made and executed by THI III GL Investments L.L.C., and THI
III GL Land Corporation, and Grande Lakes Resort Property Owners Association,
Inc., dated April 1, 2004 and recorded August 6, 2004 in Official Records Book
7565, Page 1177 et seq. of the Public Records of Orange County, Florida and that
certain Declaration of Covenants, Conditions, Restrictions, Easements and
Reservations for Grande Lakes Master Stormwater Management System, made and
executed by THI III GL Investments L.L.C., THI III GL Land Corporation and
Grande Lakes Stormwater Management Association, Inc. recorded on August 7, 2003
in Official Records Book 7038 at Pages 2091 et seq. of the Public Records of
Orange County, Florida.

                                   Exhibit A-1

<PAGE>

                                   EXHIBIT A-2

                       Legal Description of Ritz Premises

Parcel l, Grande Lakes Resort, according to the plat thereof, as recorded in
Plat Book 58 at Pages 23 through 36, inclusive, of the Public Records of Orange
County, Florida, together with easements appurtenant to said parcels established
by and pursuant to the terms of that certain Declaration of Covenants,
Conditions, Restrictions, Easements and Reservations for Grande Lakes Resort,
Orlando, Florida, made and executed by THI III GL Investments L.L.C., and THI
III GL Land Corporation, and Grande Lakes Resort Property Owners Association,
Inc., dated April 1, 2004 and recorded August 6, 2004 in Official Records Book
7656, Page 1177 et seq. of the Public Records of Orange County, Florida and that
certain Declaration of Covenants, Conditions, Restrictions, Easements and
Reservations for Grande Lakes Master Stormwater Management System, made and
executed by THI III GL Investments L.L.C., THI III GL Land Corporation and
Grande Lakes Stormwater Management Association, Inc. recorded on August 7, 2003
in Official Records Book 7038 at Pages 2091 et seq. of the Public Records of
Orange County, Florida.

                                   Exhibit A-2

<PAGE>

                                   EXHIBIT A-3

                       Legal Description of Golf Premises

Parcel 5, Grande Lakes Resort, according to the plat thereof, as recorded in
Plat Book 58 at Pages 23 through 36, inclusive, of the Public Records of Orange
County, Florida, together with easements appurtenant to said parcels established
by and pursuant to the terms of that certain Declaration of Covenants,
Conditions, Restrictions, Easements and Reservations for Grande Lakes Resort,
Orlando, Florida, made and executed by THI III GL Investments L.L.C., and THI
III GL Land Corporation, and Grande Lakes Resort Property Owners Association,
Inc., dated April 1, 2004 and recorded August 6, 2004 in Official Records Book
7565, Page 1177 et seq. of the Public Records of Orange County, Florida and that
certain Declaration of Covenants, Conditions, Restrictions, Easements and
Reservations for Grande Lakes Master Stormwater Management System, made and
executed by THI III GL Investments L.L.C., THI III GL Land Corporation and
Grande Lakes Stormwater Management Association, Inc. recorded on August 7, 2003
in Official Records Book 7038 at Pages 2091 et seq. of the Public Records of
Orange County, Florida.

                                   Exhibit A-3

<PAGE>

                                    EXHIBIT B

                               SUMMARY OF RESERVES
<TABLE>
<CAPTION>

  Reserve Items                           Initial Deposit Amount        Monthly Installment Amount
  -------------                           ----------------------        --------------------------
<S>                                       <C>                           <C>
Basic Carrying Costs
- Taxes                                   $0                            $0
- Insurance Premiums                      $0                            $0
Initial Engineering Deposits                                            Not Applicable
- Immediate Repairs                       $0
- Environmental Remediation               $0
Recurring Replacement Reserve Monthly     Not Applicable                As set forth in the
                                                                        definition of Recurring
                                                                        Replacement Reserve Monthly
                                                                        Installment
</TABLE>

                                    Exhibit B

<PAGE>

                                    EXHIBIT C

                              Intentionally Omitted

                                    Exhibit C

<PAGE>

                                    EXHIBIT D

                            Required Engineering Work

                                      None

                                    Exhibit D

<PAGE>

                                    EXHIBIT E

                        Initial Allocated Loan Amount and
                         Cross-collateralized Properties

<TABLE>
<CAPTION>
Cross-collateralized Property             Initial Allocated Loan Amount
<S>                                       <C>
JW Premises                                        $214,517,543.86
Ritz Premises                                      $114,605,263.16
Golf Premises                                      $  5,877,192.98
</TABLE>

                                    Exhibit E

<PAGE>

                                   SCHEDULE 1

                                Approved Managers

KSL II Management Operations, LLC
Hilton Hotels Corporation
Hilton Group, PLC
Marriott International, Inc.
Starwood Hotels and Resorts Worldwide, Inc.
Four Seasons Hotel Inc.
Hyatt
The Blackstone Group/LXR Resorts
Destination Resorts and Management/Loews Hotels
Inter-Continental and Interstate Hotels & Resorts
Rosewood Hotels and Resorts
Mandarin Hotels
Peninsula Hotels

                                   Schedule 1

<PAGE>

                                   SCHEDULE 2

                        Example of Debt Yield Calculation

-------------------------------------------------------------------------------
Net Operating Income = Operating Income - Operating Expenses

$59,500,000 = $194,000,000 - $134,500,000

-------------------------------------------------------------------------------
Adjusted Net Cash Flow = Net Operating Income - Recurring Replacement Reserve
Monthly Installment

$53,700,000 = $59,500,000 - $5,800,000

-------------------------------------------------------------------------------
Debt Yield = Adjusted Net Cash Flow / the outstanding principal balance of the
Loan and the Mez Loan

9.4% = $53,700,000 / $570,000,000

                                   Schedule 2
<PAGE>

<TABLE>
<S>                                                                          <C>
ARTICLE I: DEFINITIONS.....................................................   5

   Section 1.01. Certain Definitions.......................................   5

ARTICLE II:  REPRESENTATIONS, WARRANTIES  AND COVENANTS OF BORROWER........  28

   Section 2.01. Payment of Debt...........................................  28

   Section 2.02. Representations, Warranties and Covenants of Borrower.....  28

   Section 2.03. Further Acts, etc. .......................................  39

   Section 2.04. Recording of Security Instrument, etc. ...................  40

   Section 2.05. Representations, Warranties and Covenants Relating to
      the Property.........................................................  40

   Section 2.06. Removal of Lien...........................................  46

   Section 2.07. Cost of Defending and Upholding this Security Instrument
      Lien.................................................................  47

   Section 2.08. Use of the Property.......................................  48

   Section 2.09. Financial Reports.........................................  48

   Section 2.10. Litigation................................................  51

   Section 2.11. Updates of Representations................................  51

ARTICLE III:  INSURANCE AND CASUALTY RESTORATION...........................  51

   Section 3.01. Insurance Coverage........................................  51

   Section 3.02. Policy Terms..............................................  54

   Section 3.03. Assignment of Policies....................................  56

   Section 3.04. Casualty Restoration......................................  57

   Section 3.05. Compliance with Insurance Requirements....................  61

   Section 3.06. Event of Default During Restoration.......................  62

   Section 3.07. Application of Proceeds to Debt Reduction.................  62
</TABLE>

                                       ii
<PAGE>

<TABLE>
<S>                                                                         <C>
ARTICLE IV:  IMPOSITIONS..................................................  62

   Section 4.01. Payment of Impositions, Utilities and Taxes, etc. .......  62

   Section 4.02. Deduction from Value.....................................  63

   Section 4.03. No Joint Assessment......................................  63

   Section 4.04. Right to Contest.........................................  63

   Section 4.05. No Credits on Account of the Debt........................  64

   Section 4.06. Documentary Stamps.......................................  64

ARTICLE V:  CENTRAL CASH MANAGEMENT.......................................  65

   Section 5.01. Cash Flow................................................  65

   Section 5.02. Establishment of Accounts................................  65

   Section 5.03. Intentionally Omitted....................................  66

   Section 5.04. Servicing Fees...........................................  66

   Section 5.05. Monthly Funding of Sub-Accounts and Escrow Accounts......  66

   Section 5.06. Payment of Basic Carrying Costs..........................  68

   Section 5.07. Intentionally Omitted....................................  68

   Section 5.08. Recurring Replacement Reserve Escrow Account.............  68

   Section 5.09. Operation and Maintenance Expense Escrow Account.........  70

   Section 5.10. Intentionally Omitted....................................  70

   Section 5.11. Curtailment Reserve Escrow Account.......................  70

   Section 5.12. Performance of Engineering Work..........................  71

   Section 5.13. Loss Proceeds............................................  71

   Section 5.14. Mez Payment Escrow Account...............................  73

ARTICLE VI:  CONDEMNATION.................................................  73
</TABLE>

                                       iii
<PAGE>

<TABLE>
<S>                                                                         <C>
   Section 6.01. Condemnation.............................................  73

ARTICLE VII:  LEASES AND RENTS............................................  75

   Section 7.01. Assignment...............................................  75

   Section 7.02. Management of Property...................................  76

ARTICLE VIII:  MAINTENANCE AND REPAIR.....................................  79

   Section 8.01. Maintenance and Repair of the Property; Alterations;
      Replacement of Equipment............................................  79

ARTICLE IX:  TRANSFER OR ENCUMBRANCE OF THE PROPERTY......................  82

   Section 9.01. Other Encumbrances.......................................  82

   Section 9.02. No Transfer..............................................  82

   Section 9.03. Due on Sale..............................................  83

   Section 9.04. Permitted Easements, Etc. ...............................  83

ARTICLE X:  CERTIFICATES..................................................  83

   Section 10.01. Estoppel Certificates...................................  83

ARTICLE XI:  NOTICES......................................................  84

   Section 11.01. Notices.................................................  84

ARTICLE XII:  INDEMNIFICATION.............................................  85

   Section 12.01. Indemnification Covering Property.......................  85

ARTICLE XIII:  DEFAULTS...................................................  86

   Section 13.01. Events of Default.......................................  86

   Section 13.02. Remedies................................................  88

   Section 13.03. Payment of Debt After Default...........................  91
</TABLE>

                                       iv
<PAGE>

<TABLE>
<S>                                                                        <C>
   Section 13.04. Possession of the Property.............................   92

   Section 13.05. Interest After Default.................................   92

   Section 13.06. Borrower's Actions After Default.......................   93

   Section 13.07. Control by Lender After Default........................   93

   Section 13.08. Right to Cure Defaults.................................   93

   Section 13.09. Late Payment Charge....................................   94

   Section 13.10. Recovery of Sums Required to Be Paid...................   94

   Section 13.11. Marshalling and Other Matters..........................   94

   Section 13.12. Tax Reduction Proceedings..............................   94

   Section 13.13. General Provisions Regarding Remedies..................   94

ARTICLE XIV:  COMPLIANCE WITH REQUIREMENTS...............................   95

   Section 14.01. Compliance with Legal Requirements.....................   95

   Section 14.02. Compliance with Recorded Documents; No Future Grants...   96

ARTICLE XV:  DEFEASANCE; PREPAYMENT......................................   96

   Section 15.01. Defeasance; Prepayment.................................   96

   Section 15.02. Release of Property....................................  100

ARTICLE XVI:  ENVIRONMENTAL COMPLIANCE...................................  104

   Section 16.01. Covenants, Representations and Warranties..............  104

   Section 16.02. Environmental Indemnification..........................  107

ARTICLE XVII:  ASSIGNMENTS...............................................  108

   Section 17.01. Participations and Assignments.........................  108

ARTICLE XVIII:  MISCELLANEOUS............................................  108
</TABLE>

                                        v
<PAGE>

<TABLE>
<S>                                                                        <C>
   Section 18.01. Right of Entry.........................................  108

   Section 18.02. Cumulative Rights......................................  108

   Section 18.03. Liability..............................................  108

   Section 18.04. Exhibits Incorporated..................................  108

   Section 18.05. Severable Provisions...................................  108

   Section 18.06. Duplicate Originals....................................  108

   Section 18.07. No Oral Change.........................................  108

   Section 18.08. Waiver of Counterclaim, Etc. ..........................  109

   Section 18.09. Headings; Construction of Documents; etc. .............  109

   Section 18.10. Sole Discretion of Lender..............................  109

   Section 18.11. Waiver of Notice.......................................  109

   Section 18.12. Covenants Run with the Land............................  109

   Section 18.13. Applicable Law.........................................  109

   Section 18.14. Security Agreement.....................................  110

   Section 18.15. Actions and Proceedings................................  111

   Section 18.16. Usury Laws.............................................  111

   Section 18.17. Remedies of Borrower...................................  112

   Section 18.18. Offsets, Counterclaims and Defenses....................  112

   Section 18.19. No Merger..............................................  112

   Section 18.20. Restoration of Rights..................................  112

   Section 18.21. Waiver of Statute of Limitations.......................  113

   Section 18.22. Advances...............................................  113

   Section 18.23. Application of Default Rate Not a Waiver...............  113

   Section 18.24. Intervening Lien.......................................  113
</TABLE>

                                       vi
<PAGE>

<TABLE>
<S>                                                                        <C>
   Section 18.25. No Joint Venture or Partnership........................  113

   Section 18.26. Time of the Essence....................................  113

   Section 18.27. Borrower's Obligations Absolute........................  113

   Section 18.28. Publicity..............................................  114

   Section 18.29. Securitization Opinions................................  114

   Section 18.30. Cooperation with Rating Agencies; etc. ................  114

   Section 18.31. Securitization Financials..............................  115

   Section 18.32. Exculpation............................................  116

   Section 18.33. Component Notes........................................  118

   Section 18.34. Certain Matters Relating to Property located in the
      State of Florida...................................................  119
</TABLE>

EXHIBITS

EXHIBIT A   Legal Description of Premises
EXHIBIT B   Summary Of Reserves
EXHIBIT C   Cash Flow Statement
EXHIBIT D   Required Engineering Work
EXHIBIT E   Initial Allocated Loan Amount

                                      vii

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