Document:

Exh 10.1 Amendment to Lease between Fund VIII and Fund IX Joint Venture and Flextronics International USA, Inc.

Exhibit 10.1

AMENDMENT TO LEASE
This Amendment to Lease (“Amendment”) is fully executed this 29 day of July 2011, 2011 by and between The Fund VIII and Fund IX Joint Venture, a Georgia joint venture (“Landlord”), and Flextronics International USA, Inc., a California corporation (“Tenant”).
RECITALS:
A.    Landlord and Tenant entered into that certain Lease Agreement dated November 15, 2005 (“Lease”) for 100% of the Building and Property located at 305 Interlocken Parkway, Broomfield, Colorado 80021.
B.    The Term of the Lease is currently scheduled to expire August 31, 2011.
C.    Tenant desires to extend the Term of the Lease and Landlord is willing to extend on the terms and conditions set forth below.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
1.    The recitals set forth above are hereby incorporated into and made a material part of this Amendment.  Capitalized terms used but not otherwise defined herein shall have the same meanings ascribed to them in the Lease.
2.    The Term of the Lease is hereby extended until November 30, 2011 (“Expiration Date”).
3.    Between September 1, 2011 and November 30, 2011, Tenant shall pay Base Rent in the amount of $50,653.13 per month (i.e., $12.50 per rentable square foot, triple net) payable monthly in advance as provided in the Lease.  Furthermore, Tenant shall continue to pay Tenant's Share of Operating Expenses as required by the Lease through the Expiration Date set forth above.
4.    Tenant has been in possession of the Premises and Tenant agrees to accept the Premises “as is” without any agreements, representations, understandings or obligations on the part of Landlord to fund any allowance, perform any alterations, repairs or improvements except as required by Section 10 of the Lease.
5.    The renewal options in Section 2 of Exhibit D to the Lease are of no further force or effect.

6.    Tenant shall continue to perform Tenant's repair and maintenance obligations under the Lease including, without limitation, the Tenant Maintenance Items defined in Section 11 of the Lease.  Landlord reserves the right to inspect the Premises, Building and Property to ensure that Tenant has performed Tenant's repair and maintenance obligations under the Lease.  Execution of this Amendment by Landlord shall not constitute an acceptance by Landlord of the condition of the Premises, Building or Property, nor shall Landlord's execution of this Amendment constitute a waiver of any of Tenant's existing obligations under the Lease including, without limitation, Tenant's surrender obligations under Section 37 of the Lease upon the Expiration Date.

7.    At Landlord's request, Tenant shall vacate prior to the Expiration Date a portion of the Premises up to one full floor in size so that Landlord may commence preparing such space for occupancy by a new tenant.  Landlord shall make such a request (or requests) by written notice to Tenant, such notice(s): (a) to be given at least thirty (30) days prior to the date Tenant shall be required to surrender such space and (b) shall state exactly which space Tenant shall be required to surrender early.  Upon Tenant's receipt of such a notice, Tenant shall surrender such space to Landlord on the required date in accordance with the surrender requirements of the Lease.  Upon Tenant's timely surrender in accordance with the preceding sentence, Tenant shall no longer be required to pay Base Rent or Tenant's Share of Operating Expenses with respect to such space, calculated on a per rentable square foot basis.

8.    Neither Landlord nor Tenant has dealt with any broker or agent in connection with the negotiation or execution of this Amendment other than CB Richard Ellis and Bitzer Partners, who Landlord shall pay in accordance with their separate agreement.  Tenant and Landlord shall each indemnify the other against all costs, expenses, attorneys' fees, and other liability for commissions or other compensation claimed by any other broker or agent claiming the same by, through, or under the indemnifying party.

9.    This Amendment sets forth the entire agreement with respect to the matters set forth herein.  There have been no additional oral or written representations or agreements.   In the case of any inconsistency between the provisions of this Amendment and the Lease, the provisions of this Amendment shall control to the extent necessary to resolve any inconsistency.
10.    If any provision contained in this Amendment is rendered invalid or unenforceable by a court of competent jurisdiction, it shall not affect the remaining provisions of this Amendment and the Lease, which shall remain in full force and effect.
11.    This Amendment shall not be binding until executed and delivered by both parties.
12.    This Amendment may be executed in any number of counterparts, any one of which shall be an original, but all of which together shall be one and the same instrument.
13.    As modified by this Amendment, the Lease is hereby ratified and confirmed, and shall remain in full force and effect.  Tenant represents and warrants to Landlord that to Tenant's knowledge as of the date hereof Landlord is not in default under the Lease and Tenant has no offsets, defenses, or claims against Landlord.

IN WITNESS WHEREOF, the parties have executed this Amendment as of the date first above written.
LANDLORD:

FUND VIII AND FUND IX JOINT VENTURE,
a Georgia joint venture

By:     WELLS REAL ESTATE FUND VIII, L.P.
A Georgia limited partnership

By:     Wells Partners, L.P.
a Georgia limited partnership, as general partner

By:     Wells Capital, Inc.
a Georgia corporation, as general partner

                        
By: /s/ Douglas P. Williams
Name: Douglas P. Williams
Title:  Senior Vice President
                                        

By:     WELLS REAL ESTATE FUND IX, L.P.
A Georgia limited partnership

By:     Wells Partners, L.P.
a Georgia limited partnership, as general partner

By:     Wells Capital, Inc.
a Georgia corporation, as general partner

                        
By: /s/ Douglas P. Williams
Name: Douglas P. Williams
Title:  Senior Vice President
 

TENANT:

FLEXTRONICS INTERNATIONAL USA, INC.,
a California corporation

By: /s/ Chris Collier
Name: Controller, Asst Secretary
Title: Controller, Asst SecretaryExhibit 10.46 

San Diego Oceanside, CA (Courtyard) 

PURCHASE CONTRACT 

between

OCEANSIDE SEAGATE SPE, LLC (“SELLER”)

AND

APPLE TEN HOSPITALITY OWNERSHIP, INC.
(“BUYER”)

Dated: October 28, 2011

TABLE OF CONTENTS

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
Page No.

	
 

	
 

	
 

	
 

	

	
 

	
 

	
 

	
 

	
 

	
ARTICLE I

	
DEFINED TERMS

	
 

	
1

	
 

	
 

	
 

	
 

	
 

	
1.1

	
Definitions

	
 

	
1

	
 

	
 

	
 

	
 

	
 

	
ARTICLE II

	
PURCHASE AND SALE; PURCHASE PRICE; PAYMENT; EARNEST MONEY DEPOSIT

	
 

	
7

	
 

	
 

	
 

	
 

	
 

	
 

	
2.1

	
Purchase and
Sale

	
 

	
7

	
 

	
 

	
 

	
 

	
 

	
 

	
2.2

	
Intentionally
Omitted

	
 

	
7

	
 

	
 

	
 

	
 

	
 

	
 

	
2.3

	
Purchase
Price

	
 

	
7

	
 

	
 

	
 

	
 

	
 

	
 

	
2.4

	
Allocation

	
 

	
7

	
 

	
 

	
 

	
 

	
 

	
 

	
2.5

	
Payment

	
 

	
7

	
 

	
 

	
 

	
 

	
 

	
 

	
2.6

	
Earnest
Money Deposit

	
 

	
7

	
 

	
 

	
 

	
 

	
 

	
ARTICLE III

	
REVIEW PERIOD

	
 

	
8

	
 

	
 

	
 

	
 

	
 

	
3.1

	
Review
Period

	
 

	
8

	
 

	
 

	
 

	
 

	
 

	
 

	
3.2

	
Due
Diligence Examination

	
 

	
8

	
 

	
 

	
 

	
 

	
 

	
 

	
3.3

	
Restoration

	
 

	
9

	
 

	
 

	
 

	
 

	
 

	
 

	
3.4

	
Seller
Exhibits

	
 

	
9

	
 

	
 

	
 

	
 

	
 

	
ARTICLE IV

	
SURVEY AND TITLE APPROVAL

	
 

	
9

	
 

	
 

	
 

	
 

	
 

	
4.1

	
Survey

	
 

	
9

	
 

	
 

	
 

	
 

	
 

	
 

	
4.2

	
Title

	
 

	
9

	
 

	
 

	
 

	
 

	
 

	
 

	
4.3

	
Survey or
Title Objections

	
 

	
10

	
 

	
 

	
 

	
 

	
 

	
ARTICLE V

	
ASSUMPTION OF MANAGEMENT AGREEMENT

	
 

	
10

	
 

	
 

	
 

	
 

	
ARTICLE VI

	
BROKERS

	
 

	
11

	
 

	
 

	
 

	
 

	
ARTICLE VII

	
REPRESENTATIONS, WARRANTIES AND COVENANTS

	
 

	
11

	
 

	
 

	
 

	
 

	
 

	
7.1

	
Seller’s
Representations, Warranties and Covenants

	
 

	
11

	
 

	
 

	
 

	
 

	
 

	
 

	
7.2

	
Buyer’s
Representations, Warranties and Covenants

	
 

	
15

	
 

	
 

	
 

	
 

	
 

	
 

	
7.3

	
Survival

	
 

	
16

	
 

	
 

	
 

	
 

	
 

	
ARTICLE VIII

	
ADDITIONAL COVENANTS

	
 

	
17

	
 

	
 

	
 

	
 

	
 

	
8.1

	
Subsequent
Developments

	
 

	
17

	
 

	
 

	
 

	
 

	
 

	
 

	
8.2

	
Operations

	
 

	
17

	
 

	
 

	
 

	
 

	
 

	
 

	
8.3

	
Third Party
Consents

	
 

	
18

	
 

	
 

	
 

	
 

	
 

	
 

	
8.4

	
Employees

	
 

	
18

i

	
 

	
 

	
 

	
 

	
 

	
 

	
8.5

	
Estoppel
Certificates

	
 

	
19

	
 

	
 

	
 

	
 

	
 

	
 

	
8.6

	
Access to
Financial Information

	
 

	
19

	
 

	
 

	
 

	
 

	
 

	
 

	
8.7

	
Bulk Sales

	
 

	
19

	
 

	
 

	
 

	
 

	
 

	
 

	
8.8

	
Indemnification

	
 

	
19

	
 

	
 

	
 

	
 

	
 

	
 

	
8.9

	
Escrow Funds

	
 

	
22

	
 

	
 

	
 

	
 

	
 

	
 

	
8.10

	
Liquor
Licenses

	
 

	
22

	
 

	
 

	
 

	
 

	
 

	
 

	
8.11

	
Construction
Warranty

	
 

	
22

	
 

	
 

	
 

	
 

	
 

	
 

	
8.12

	
Punch-List

	
 

	
22

	
 

	
 

	
 

	
 

	
 

	
ARTICLE IX

	
CONDITIONS FOR CLOSING

	
 

	
23

	
 

	
 

	
 

	
 

	
 

	
9.1

	
Buyer’s
Conditions for Closing

	
 

	
23

	
 

	
 

	
 

	
 

	
 

	
 

	
9.2

	
Seller’s
Conditions for Closing

	
 

	
24

	
 

	
 

	
 

	
 

	
 

	
ARTICLE X

	
CLOSING AND CONVEYANCE

	
 

	
24

	
 

	
 

	
 

	
 

	
 

	
10.1

	
Closing

	
 

	
24

	
 

	
 

	
 

	
 

	
 

	
 

	
10.2

	
Deliveries
of Seller

	
 

	
24

	
 

	
 

	
 

	
 

	
 

	
 

	
10.3

	
Buyer’s
Deliveries

	
 

	
26

	
 

	
 

	
 

	
 

	
 

	
ARTICLE XI

	
COSTS

	
 

	
27

	
 

	
 

	
 

	
 

	
 

	
11.1

	
Seller’s
Costs

	
 

	
27

	
 

	
 

	
 

	
 

	
 

	
 

	
11.2

	
Buyer’s
Costs

	
 

	
27

	
 

	
 

	
 

	
 

	
 

	
ARTICLE XII

	
ADJUSTMENTS

	
 

	
28

	
 

	
 

	
 

	
 

	
 

	
12.1

	
Adjustments

	
 

	
28

	
 

	
 

	
 

	
 

	
 

	
 

	
12.2

	
Reconciliation
and Final Payment

	
 

	
29

	
 

	
 

	
 

	
 

	
 

	
 

	
12.3

	
Employees

	
 

	
29

	
 

	
 

	
 

	
 

	
 

	
ARTICLE XIII

	
CASUALTY AND CONDEMNATION

	
 

	
30

	
 

	
 

	
 

	
 

	
 

	
13.1

	
Risk of
Loss; Notice

	
 

	
30

	
 

	
 

	
 

	
 

	
 

	
 

	
13.2

	
Buyer’s
Termination Right

	
 

	
30

	
 

	
 

	
 

	
 

	
 

	
 

	
13.3

	
Procedure
for Closing

	
 

	
30

	
 

	
 

	
 

	
 

	
 

	
ARTICLE XIV

	
DEFAULT REMEDIES

	
 

	
31

	
 

	
 

	
 

	
 

	
 

	
14.1

	
Buyer
Default

	
 

	
31

	
 

	
 

	
 

	
 

	
 

	
 

	
14.2

	
Seller
Default

	
 

	
32

	
 

	
 

	
 

	
 

	
 

	
 

	
14.3

	
Attorney’s
Fees

	
 

	
32

	
 

	
 

	
 

	
 

	
 

	
ARTICLE XV

	
NOTICES

	
 

	
32

	
 

	
 

	
 

	
 

	
 

	
ARTICLE XVI

	
MISCELLANEOUS

	
 

	
34

	
 

	
 

	
 

	
 

	
 

	
 

	
16.1

	
Performance

	
 

	
34

ii

	
 

	
 

	
 

	
 

	
 

	
 

	
16.2

	
Binding Effect;
Assignment

	
 

	
34

	
 

	
 

	
 

	
 

	
 

	
 

	
16.3

	
Entire
Agreement

	
 

	
34

	
 

	
 

	
 

	
 

	
 

	
 

	
16.4

	
Governing
Law

	
 

	
34

	
 

	
 

	
 

	
 

	
 

	
 

	
16.5

	
Captions

	
 

	
34

	
 

	
 

	
 

	
 

	
 

	
 

	
16.6

	
Confidentiality

	
 

	
34

	
 

	
 

	
 

	
 

	
 

	
 

	
16.7

	
Closing
Documents

	
 

	
34

	
 

	
 

	
 

	
 

	
 

	
 

	
16.8

	
Counterparts

	
 

	
34

	
 

	
 

	
 

	
 

	
 

	
 

	
16.9

	
Severability

	
 

	
34

	
 

	
 

	
 

	
 

	
 

	
 

	
16.10

	
Interpretation

	
 

	
35

	
 

	
 

	
 

	
 

	
 

	
 

	
16.11

	
(Intentionally
Omitted)

	
 

	
35

	
 

	
 

	
 

	
 

	
 

	
 

	
16.12

	
Further Acts

	
 

	
35

	
 

	
 

	
 

	
 

	
 

	
 

	
16.13

	
Joint and
Several Obligations

	
 

	
35

	
 

	
 

	
SCHEDULES:

	
 

	
 

	
 

	
Schedule 2.4

	
Allocation

	
 

	
 

	
EXHIBITS:

	
 

	
 

	
 

	
Exhibit A

	
Legal
Description

	
Exhibit B

	
List of
FF&E

	
Exhibit C

	
Document
Inventory

	
Exhibit D

	
List of
Hotel Contracts

	
Exhibit E

	
Consents and
Approvals

	
Exhibit F

	
Environmental
Reports

	
Exhibit G

	
Claims or
Litigation Pending

	
Exhibit H

	
Escrow
Agreement

	
Exhibit I

	
Construction
Warranty

iii

PURCHASE CONTRACT 

          This
PURCHASE CONTRACT (this “Contract”)
is made and entered into as of October 28, 2011, by and between OCEANSIDE
SEAGATE SPE, LLC, a California limited liability company ( “Seller”) with a principal office at c/o
R. D. Olson Development, 2955 Main Street, 3rd Floor, Irvine,
California 92614, and APPLE TEN HOSPITALITY OWNERSHIP, INC., a Virginia
corporation, with its principal office at 814 East Main Street, Richmond,
Virginia 23219, or its affiliates or assigns (“Buyer”). 

RECITALS

          A.
Seller is the fee simple owner of that certain hotel property commonly known as
the Courtyard San Diego Oceanside located at 3501 Seagate Way, Oceanside,
California 92056 (the “Hotel”)
identified in on Exhibit A
attached hereto and incorporated by reference. 

          B.
Buyer is desirous of purchasing the Hotel from Seller, and Seller is desirous
of selling the Hotel to Buyer, for the purchase price and upon terms and
conditions hereinafter set forth. 

AGREEMENT:

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

ARTICLE I

DEFINED TERMS

          1.1
Definitions. The following capitalized terms when used in this Contract
shall have the meanings set forth below unless the context otherwise requires: 

          “Additional
Deposit” shall mean $200,000. 

          “Affiliate”
shall mean, with respect to Seller or Buyer, any other person or entity
directly or indirectly controlling (including but not limited to all directors
and officers), controlled by or under direct or indirect common control with
Seller or Buyer, as applicable. For purposes of the foregoing, a person or
entity shall be deemed to control another person or entity if it possesses,
directly or indirectly, the power to direct or cause direction of the
management and policies of such other person or entity, whether through the ownership
of voting securities, by contract or otherwise. 

          “Appurtenances” shall
mean all rights, titles, and interests of Seller appurtenant to the Land and
Improvements, including, but not limited to, (i) all easements, rights of way,
rights of ingress and egress, tenements, hereditaments, privileges, and
appurtenances in any way belonging to the Land or Improvements, (ii) any land
lying in the bed of any alley, highway, street, road or avenue, open or
proposed, in front of or abutting or adjoining the Land, (iii) any strips or
gores of real estate adjacent to the Land, and (iv) the use of all alleys,
easements and rights-of-way, if any, abutting, adjacent, contiguous to or
adjoining the Land. 

1

          “Architect”
shall mean the architect for the Hotel, Johnson Braund Design Group. 

          “Brand”
shall mean Courtyard by Marriott, the hotel brand or franchise under which the
Hotel operates. 

          “Business
Day” shall mean any day other than a Saturday, Sunday or legal holiday in
the State of California. 

          “Closing”
shall mean the closing of the purchase and sale of the Property pursuant to
this Contract. 

          “Closing
Date” shall have the meaning set forth in Section 10.1. 

          “Construction
Warranty” shall have the meaning set forth in Section 8.11. 

          “Contractor”
shall mean the contractor for the Hotel, R.D. Olson Construction, Inc. 

          “Contracts,
Plans and Specs” shall mean all current construction and other contracts,
plans, drawings, specifications, surveys, soil reports, engineering reports,
inspection reports, and other technical descriptions and reports in Seller’s
possession or control. 

          “Deed”
shall have the meaning set forth in Section 10.2(a). 

          “Deposits”
shall mean, to the extent assignable, all prepaid rents and deposits
(including, without limitation, any reserves for replacement of FF&E and
for capital repairs and/or improvements), refundable security deposits and
rental deposits, and all other deposits for advance reservations, banquets or
future services, made in connection with the use or occupancy of the
Improvements; provided, however, that to the extent Seller has not received or
does not hold all of the prepaid rents and/or deposits attributable to the
Leases related to the Property, Buyer shall be entitled to a credit against the
cash portion of the Purchase Price allocable to the Property in an amount equal
to the amount of the prepaid rents and/or deposits attributable to the Leases
transferred at the Closing of such Property, and provided further, that
“Deposits” shall exclude (i) reserves for real property taxes and insurance, in
each case, to the extent pro rated on the settlement statement such that Buyer
receives a credit for (a) taxes and premiums in respect of any period prior to
Closing and (b) the amount of deductibles and other self-insurance and all
other potential liabilities and claims in respect of any period prior to
Closing, and (ii) utility deposits. 

          “Due
Diligence Examination” shall have the meaning set forth in Section 3.2. 

          “Earnest
Money Deposit” shall have the meaning set forth in Section 2.6(a). 

          “Environmental
Requirements” shall have the meaning set forth in Section 7.1(f) 

          “Escrow
Agent” shall have the meaning set forth in Section 2.6(a). 

          “Escrow
Agreement” shall have the meaning set forth in Section 2.6(b). 

          “Exception
Documents” shall have the meaning set forth in Section 4.2. 

2

          “Existing
Management Agreement” shall mean that certain management agreement, as
amended, between the Seller and the Manager for the operation and management of
the Hotel. 

          “FF&E”
shall mean all tangible personal property and fixtures of any kind (other than
personal property (i) owned by guests of the Hotel or (ii) leased by Seller
pursuant to an FF&E Lease) attached to, or located upon and used in
connection with the ownership, maintenance, use or operation of the Land or
Improvements as of the date hereof (or acquired by Seller and so employed prior
to Closing), including, but not limited to, all furniture, fixtures, equipment,
signs and related personal property; all heating, lighting, plumbing, drainage,
electrical, air conditioning, and other mechanical fixtures and equipment and systems;
all elevators, and related motors and electrical equipment and systems; all hot
water heaters, furnaces, heating controls, motors and equipment, all shelving
and partitions, all ventilating equipment, and all disposal equipment; all spa,
health club and fitness equipment; all equipment used in connection with the
use and/or maintenance of the guestrooms, restaurants, lounges, business
centers, meeting rooms, swimming pools, indoor and/or outdoor sports facilities
and other common areas and recreational areas; all carpet, drapes, beds,
furniture, televisions and other furnishings; all stoves, ovens, freezers,
refrigerators, dishwashers, disposals, kitchen equipment and utensils, tables,
chairs, plates and other dishes, glasses, silverware, serving pieces and other
restaurant and bar equipment, apparatus and utensils. A current list of
FF&E is attached hereto as Exhibit B, or will be attached hereto no later
than ten (10) days prior to the expiration of the Review Period.

          “FF&E
Leases” shall mean all leases of any FF&E and other contracts
permitting the use of any FF&E at the Improvements that are assumed by
Buyer. 

          “Financial
Statements” shall have the meaning set forth in Section 3.1(b). 

          “Hotel
Contracts” shall have the meaning set forth in Section 10.2(d). 

          “Improvements”
shall mean all buildings, structures, fixtures, parking areas and other
improvements to the Land, and all related facilities. 

          “Indemnified
Party” shall have the meaning set forth in Section 8.8(c)(i).

        
  “Indemnifying Party” shall have the meaning set forth in Section 8.8(c)(i).

          “Initial Deposit” shall have the meaning set forth in Section 2.6(a).  

          “Land”
shall mean, collectively, a fee simple absolute interest in the real property
more fully described in Exhibit A, which is attached hereto and incorporated
herein by reference, together with all rights of Seller thereto (including
without limitation all air rights and development rights), alleys, streets,
strips, gores, waters, privileges, appurtenances, advantages and easements
belonging thereto or in any way appertaining thereto.  

          “Leases”
shall mean all leases, franchises, licenses, occupancy agreements, “trade-out”
agreements, advance bookings, convention reservations, or other agreements
demising space in, providing for the use or occupancy of, or otherwise
similarly affecting or relating to the use or occupancy of, the Improvements or
Land, together with all amendments, modifications, renewals 

3

and extensions thereof, and
all guaranties by third parties of the obligations of the tenants, licensees,
franchisees, concessionaires or other entities thereunder. 

          “Legal
Action” shall have the meaning set forth in Section 8.8(c)(ii). 

          “Licenses”
shall mean all permits, licenses, franchises, utility reservations,
certificates of occupancy, and other documents issued by any federal, state, or
municipal authority or by any private party related to the development,
construction, use, occupancy, operation or maintenance of the Hotel, including,
without limitation, all licenses, approvals and rights (including any and all
existing waivers of any brand standard) necessary or appropriate for the
operation of the Hotel under the Brand. 

          “Liquor
Licenses” shall have the meaning set forth in Section 8.10. 

          “Manager”
shall mean COURTYARD MANAGEMENT CORPORATION, a Delaware corporation 

          “Other
Property” shall have the meaning set forth in Section 16.14. 

          “Pending
Claims” shall have the meaning set forth in Section 7.1(e). 

          “Permitted
Exceptions” shall have the meaning set forth in Section 4.3. 

          “Personal
Property” shall mean, collectively, all of the Property other than the Real
Property. 

          “PIP”
shall mean a product improvement plan for any Hotel, as required by the Manager
under the Existing Management Agreement, if any. 

          “Post-Closing
Agreement” shall have the meaning set forth in Section 8.9. 

          “Property”
shall mean, collectively, (i) all of the following with respect to the Hotel:
the Land, Improvements, Appurtenances, FF&E, Supplies, Leases, Deposits,
Records, Service Contracts, Warranties, Licenses, FF&E Leases, Contracts,
Plans and Specs, Tradenames, Utility Reservations, as well as all other real,
personal or intangible property of Seller related to any of the foregoing and
(ii) any and all of the following that relate to or affect in any way the
design, construction, ownership, use, occupancy, leasing, maintenance, service or
operation of the Real Property, FF&E, Supplies, Leases, Deposits or
Records: Service Contracts, Warranties, Licenses, Tradenames, Contracts, Plans
and Specs and FF&E Lease. 

          “Purchase
Price” shall have the meaning set forth in Section 2.2. 

          “Punch
List Items” shall mean such items (i) as are reasonably necessary or
appropriate to fully complete the construction, equipping and furnishing of the
Hotel in accordance with this Contract and (ii) that, unless otherwise agreed
by Buyer in its commercially reasonable discretion, (a) individually and in the
aggregate do not and will not prohibit, cause a delay in or otherwise adversely
affect, under applicable Legal Requirements, the Franchise Agreement or
otherwise, the opening of the Hotel for business to the public or the continued
occupancy and 

4

operation of the Hotel as
contemplated under the Brand and (b) may be corrected or completed, subject to
delays caused by Force Majeure, within not more than sixty (60) days after
Substantial Completion of the Hotel. 

          “Real
Property” shall mean, collectively, all Land, Improvements and
Appurtenances with respect to the Hotel. 

          “Records”
shall mean all books, records, promotional material, tenant data, guest history
information (other than any such information owned exclusively by the Manager),
marketing and leasing material and forms (including but not limited to any such
records, data, information, material and forms in the form of computerized
files located at the Hotel), market studies prepared in connection with
Seller’s current annual plan and other materials, information, data, legal or
other documents or records (including, without limitation, all documentation
relating to any litigation or other proceedings (excepting therefrom those
subject to attorney-client or work product privilege or other privileges that
may be asserted in litigation, and Seller’s proprietary reports prepared by
Buyer including without limitation, proprietary development determinations, tax
or profitability evaluations or proformas), all zoning and/or land use notices,
relating to or affecting the Property) owned by Seller and/or in Seller’s
possession or control, or to which Seller has access or may obtain from the
Manager, that are used in or relating to the Property and/or the operation of
the Hotel, including the Land, the Improvements or the FF&E, and contracts
related to the development and construction of the Hotel and a list of the
general contractors, architects and engineers providing goods and/or services
in connection with the construction of the Hotel, all construction warranties
and guaranties in effect at Closing and copies of the final plans and
specifications for the Hotel. 

          “Release”
shall have the meaning set forth in Section 7.1(f). 

          “Review
Period” shall have the meaning set forth in Section 3.1. 

          “SEC”
shall have the meaning set forth in Section 8.6. 

          “Seller
Liens” shall have the meaning set forth in Section 4.3. 

          “Seller
Parties” shall have the meaning set forth in Section 7.1(e). 

          “Service
Contracts” shall mean contracts or agreements, such as maintenance, supply,
service or utility contracts. 

          “Substantial
Completion,” including variations thereof such as “Substantially Complete”
and “Substantially Completed” shall mean: (i) the Architect and the Contractor
have issued a certificate of substantial completion in form and substance
satisfactory to Buyer certifying that the Hotel has been constructed
substantially in accordance with the Plans and Specifications and the Legal
Requirements, (ii) at least a temporary certificate of occupancy authorizing
the opening of the Hotel for business to the public and for operation under the
Brand has been issued by the local governing authority and is in full force and
effect, (iii) all other final and unconditional consents, approvals, licenses
and operating permits necessary or appropriate for the Hotel to open for
business to the public and to operate under the Brand have been issued by and
obtained from all applicable governmental and regulatory authorities, subject
to Punch List Items; (iv) the 

5

Hotel is fully furnished,
fitted and equipped and ready to open for business to the public and operate
under the Brand, subject to Punch List Items; (v) all contractors,
subcontractors, suppliers, mechanics, materialmen and other persons or entities
providing labor or materials for the construction and development of the Hotel
shall have been paid in full (or adequate provision for payment of such persons
or entities has been made to Buyer’s satisfaction), subject to Punch List Items
and (vi) the Franchisor has approved the completion, furnishing and equipping
of the Hotel and is prepared to commence (or authorize the commencement of)
operation of the Hotel, and all of the other conditions set forth in the
Franchise Agreement have been satisfied, subject to Punch List Items. 

          “Supplies”
shall mean all merchandise, supplies, inventory and other items used for the
operation and maintenance of guest rooms, restaurants, lounges, swimming pools,
health clubs, spas, business centers, meeting rooms and other common areas and
recreational areas located within or relating to the Improvements, including,
without limitation, all food and beverage (alcoholic and non-alcoholic)
inventory, office supplies and stationery, advertising and promotional
materials, china, glasses, silver/flatware, towels, linen and bedding (all of
which shall be 2-par level for all suites or rooms in the Hotel), guest
cleaning, paper and other supplies, upholstery material, carpets, rugs,
furniture, engineers’ supplies, paint and painters’ supplies, employee
uniforms, and all cleaning and maintenance supplies, including those used in
connection with the swimming pools, indoor and/or outdoor sports facilities,
health clubs, spas, fitness centers, restaurants, business centers, meeting
rooms and other common areas and recreational areas. 

          “Survey”
shall have the meaning set forth in Section 4.1. 

          “Third
Party Consents” shall have the meaning set forth in Section 8.3. 

          “Title
Commitment” shall have the meaning set forth in Section 4.2. 

          “Title
Company” shall have the meaning set forth in Section 4.2. 

          “Title
Policy” shall have the meaning set forth in Section 4.2.

          “Title
Review Period” shall have the meaning set forth in Section 4.3. 

          “Tradenames”
shall mean all telephone exchanges and numbers, trade names, trade styles,
trade marks, and other identifying material, and all variations thereof,
together with all related goodwill (it being understood and agreed that the
name of the hotel chain to which the Hotel is affiliated by franchise, license
or management agreement is a protected name or registered service mark of such
hotel chain and cannot be transferred to Buyer by this Contract, provided that
all such franchise, license, management and other agreements granting a right
to use the name of such hotel chain or any other trademark or trade name and
all waivers of any brand standard shall be assigned to Buyer. 

          “Utility
Reservations” shall mean Seller’s interest in the right to receive
immediately on and after Closing and continuously consume thereafter water
service, sanitary and storm sewer service, electrical service, gas service and
telephone service on and for the Land and Improvements in capacities that are
adequate continuously to use and operate the Improvements 

6

for the purposes for which
they were intended, including, but not limited to (i) any right to the present
and future use of wastewater, drainage, water and other utility facilities to
the extent such use benefits the Real Property, (ii) any reservations of or
commitments covering any such use in the future, and (iii) any wastewater
capacity reservations relating to the Real Property. Buyer shall be responsible
for any requests or documents to transfer the Utility Reservations, at Buyer’s
sole cost and expense. 

          “Warranties”
shall mean all warranties, guaranties, indemnities and claims for the benefit
of Seller with respect to the Hotel, the Property or any portion thereof,
including, without limitation, all warranties and guaranties of the
development, construction, completion, installation, equipping and furnishing
of the Hotel, and all indemnities, bonds and claims of Seller related thereto. 

ARTICLE II

PURCHASE AND SALE; PURCHASE PRICE; PAYMENT;

EARNEST MONEY DEPOSIT

          2.1
Purchase and Sale. Seller agrees to sell and convey to Buyer or its
Affiliates and/or assigns, and Buyer or its assigns agrees to purchase from
Seller, the Property, in consideration of the Purchase Price and upon the terms
and conditions hereof. All of the Property shall be conveyed, assigned, and
transferred to Buyer at Closing, free and clear of all mortgages, liens,
encumbrances, licenses, franchises (other than any hotel franchises assumed by
Buyer), concession agreements, security interests, prior assignments or
conveyances, conditions, restrictions, rights-of-way, easements, encroachments,
claims and other matters affecting title or possession, except for the
Permitted Exceptions. 

          2.2
Intentionally Deleted. 

          2.3
Purchase Price. Buyer agrees to pay, and Seller agrees to accept, as
consideration for the conveyance of the Property, subject to the adjustments
provided for in this Contract, the amount of Thirty Million Five Hundred
Thousand and No/100 Dollars ($30,500,000.00) (the “Purchase Price”). 

          2.4
Allocation. Buyer and Seller agree to the allocation of the Purchase
Price among Real Property, tangible Personal Property and intangible property
related to the Property as shown on Schedule 2.4 attached hereto. 

          2.5
Payment. The portion of the Purchase Price, less the Earnest Money
Deposit and interest earned thereon, if any, less the Escrow Funds, shall be
paid to Seller in cash, certified funds or wire transfer, at the Closing of the
Property. 

          2.6
Earnest Money Deposit. 

               (a)
Within three (3) Business Days after the full execution and delivery of this
Contract, Buyer shall deposit the sum of Two Hundred Thousand and No/100
Dollars ($200,000.00) in cash, certified bank check or by wire transfer of
immediately available funds (the “Initial
Deposit”) with the Title Company, as escrow agent (“Escrow Agent”), which sum shall be held
by Escrow Agent as earnest money. If, pursuant to the provisions of Section 3.1
of 

7

this Contract, Buyer elects
to terminate this Contract at any time prior to the expiration of the Review
Period, then the Escrow Agent shall return the Earnest Money Deposit to Buyer
promptly upon written notice to that effect from Buyer. If Buyer does not elect
to terminate this Contract on or before the expiration of the Review Period,
Buyer shall, within three (3) Business Days after the expiration of the Review
Period deposit the Additional Deposit with the Escrow Agent. The Initial
Deposit and the Additional Deposit, and all interest accrued thereon, shall
hereinafter be referred to as the “Earnest
Money Deposit.” 

               (b)
The Earnest Money Deposit shall be held by Escrow Agent subject to the terms
and conditions of an Escrow Agreement dated as of the date of this Contract
entered into by Seller, Buyer and Escrow Agent (the “Escrow Agreement”). The Earnest Money
Deposit shall be held in an interest-bearing account in a federally insured
bank or savings institution reasonably acceptable to Seller and Buyer, with all
interest to accrue to the benefit of the party entitled to receive it and to be
reportable by such party for income tax purposes. 

ARTICLE III

REVIEW PERIOD

          3.1
Review Period. Buyer shall have a period through 6:00 p.m. California
Time on November 16, 2011 and except as otherwise agreed to by Buyer and Seller
(the “Review Period”), to evaluate
the legal, title, survey, construction, physical condition, structural,
mechanical, environmental, economic, permit status, franchise status, financial
and other documents and information related to the Property. Within five (5)
Business Days following the date of this Contract, Seller, at Seller’s sole
cost and expense, will deliver to Buyer for Buyer’s review, to the extent not
previously delivered to Buyer, true, correct and complete copies of the
documents requested by Buyer as set forth on Exhibit C (the “Document
Inventory”) which are in Seller’s possession or readily available at nominal
cost to Seller.  

          Seller
shall, upon request of Buyer, make available to Buyer and Buyer’s
representatives and agents, for inspection and copying during normal business
hours, Records located at Seller’s corporate offices, and Seller agrees to
provide Buyer copies of all other reasonably requested information that is
relevant to the management, operation, use, occupancy or leasing of or title to
the applicable Hotel and the plans specifications for development of the Hotel.
At any time during the Review Period, Buyer may, in its sole and absolute
discretion, elect not to proceed with the purchase of the Property for any
reason whatsoever by giving written notice thereof to Seller, in which event:
(i) the Earnest Money Deposit shall be promptly returned by Escrow Agent to
Buyer together with all accrued interest, if any, (ii) this Contract shall be
terminated automatically, (iii) all materials supplied by Seller to Buyer shall
be returned promptly to Seller, and (iv) both parties will be relieved of all
other rights, obligations and liabilities hereunder, except for the parties’
obligations pursuant to Sections 3.3 and 16.6 below. All Records or items on
the Document Inventory to be given to Buyer by Seller will be delivered as an
accommodation to Buyer and without any representation or warranty as to the
accuracy, enforceability, or assignability of any of the Records, all of which
Buyer relies on at its own risk. 

          3.2
Due Diligence Examination. At any time during the Review Period, and
thereafter through Closing of the Property, Buyer and/or its representatives
and agents shall have the right to enter upon the Property at all reasonable
times for the purposes of reviewing all 

8

Records and other data,
documents and/or information relating to the Property and conducting such
surveys, appraisals, engineering tests, soil tests (including, without
limitation, Phase I and Phase II environmental site assessments), inspections
of construction and other inspections and other studies as Buyer deems
reasonable and necessary or appropriate to evaluate the Property, subject to
providing reasonable advance notice to Seller unless otherwise agreed to by
Buyer and Seller (the “Due Diligence
Examination”). Buyer and/or its representatives and agents will
maintain, and provide to Seller evidence of commercial general liability
insurance by policy or umbrella in an amount no less than Two Million Dollars
($2,000,000) per occurrence and Five Million Dollars ($5,000,000) annual
aggregate and on terms reasonably satisfactory to Seller covering any accident
or damage arising in connection with the presence of Buyer and/or its
representatives and agents on the Property, and deliver a certificate of
insurance, which names Seller and its agents, representatives and employees as
additional insureds thereunder confirming such coverage to Seller prior to
entry upon the Property. Seller shall have the right to have its representative
present during Buyer’s physical inspections of its Property, provided that
failure of Seller to do so shall not prevent Buyer from exercising its due
diligence, review and inspection rights hereunder. Buyer agrees to exercise
reasonable care when visiting the Property, in a manner which shall not
materially adversely affect the operation of the Property. 

          3.3
Restoration. Buyer covenants and agrees not to damage or destroy any
portion of the Property in conducting its examinations and studies of the
Property during the Due Diligence Examination and, if closing does not occur,
shall repair any portion of the Property damaged by the conduct of Buyer, its
agents or employees, to substantially the condition such portion(s) of the
Property were in immediately prior to such examinations or studies. 

          3.4
Seller Exhibits. Buyer shall have until the end of the Review Period to
review and approve the information on Exhibits B, C, D, E and F. In the event
Buyer does not approve any such Exhibit or the information contained therein,
Buyer shall be entitled to terminate this Contract by notice to Seller and the
Earnest Money Deposit shall be returned to Buyer with all interest thereon and
both parties shall be relieved of all rights, obligations and liabilities
hereunder except for the parties’ obligations pursuant to Sections 3.3 and
16.6. 

ARTICLE IV

SURVEY AND TITLE APPROVAL

          4.1
Survey. Seller has delivered to Buyer true, correct and complete copies
of the most recent surveys of the Real Property in Seller’s possession or
control. Seller shall order an update of the survey or a new survey (such
updated or new surveys being referred to as the “Survey”), in either case such that it shall be an ALTA
as-built survey, the cost of which shall be paid by Buyer at Closing. 

          4.2
Title. Seller has delivered to Buyer its existing pro-forma title
insurance policy, and Preliminary Title Report Order No. Error! Reference source not found.,
including copies of all documents referred to therein, for its Real Property.
Buyer’s obligations under this Contract are conditioned upon Buyer being able
to obtain, at Buyer’s cost, (i) a Commitment for Title Insurance (the “Title Commitment”) issued by Chicago
Title Company, Attn: Debby Moore, 5501 LBJ Freeway, Suite 200, Dallas, Texas
75240(the “Title Company”),
for the most recent standard form of owner’s policy of title insurance in the
state in which the Real Property 

9

is located, covering the
Real Property, setting forth the current status of the title to the Real
Property, showing all liens, claims, encumbrances, easements, rights of way,
encroachments, reservations, restrictions and any other matters affecting the
Real Property and pursuant to which the Title Company agrees to issue to Buyer
at Closing an Owner’s Policy of Title Insurance on the most recent form of ALTA
(where available) owner’s policy available in the state in which the Land is
located, with extended coverage and, to the extent applicable and available in
such state, comprehensive, access, single tax parcel, contiguity and such other
endorsements as may be required by Buyer (collectively, the “Title Policy”); and (ii) true,
complete, legible and, where applicable, recorded copies of all documents and
instruments (the “Exception Documents”)
referred to or identified in the Title Commitment, including, but not limited
to, all deeds, lien instruments, leases, plats, surveys, reservations,
restrictions, and easements affecting the Real Property. If requested by
Seller, Buyer shall promptly provide Seller with a copy of the Title Commitment
issued by the Title Company. 

          4.3
Survey or Title Objections. If Buyer discovers any title or survey
matter which is objectionable to Buyer, Buyer may provide Seller with written
notice of its objection to same within five (5) days prior to the expiration of
the Review Period (the “Title Review
Period”). If Buyer fails to so object in writing to any such
matter set forth in the Survey or Title Commitment, it shall be conclusively
assumed that Buyer has approved same. If Buyer disapproves any condition of
title, survey or other matters by written objection to Seller on or before the
expiration of the Title Review Period, Seller shall elect either to attempt to
cure or not cure any such item by written notice sent to Buyer within five (5)
days after its receipt of notice from Buyer, and if Seller commits in writing
to attempt to cure any such item, then Seller shall be given until the Closing
Date to cure any such defect. In the event Seller shall fail to cure a defect
which Seller has committed in writing to cure prior to Closing, or if a new
title defect arises after the date of Buyer’s Title Commitment or Survey, as
applicable, but prior to Closing, then Buyer may elect, in Buyer’s sole and
absolute discretion: (i) to waive such objection and proceed to Closing, or
(ii) to terminate this Contract and receive a return of the Earnest Money
Deposit, and any interest thereon. The items shown on the Title Commitment
which are not objected to by Buyer as set forth above (other than exceptions
and title defects arising after the title review period and other than those
standard exceptions which are ordinarily and customarily omitted in the state
in which the applicable Hotel is located, so long as Seller provides the
appropriate owner’s affidavit, gap indemnity or other documentation reasonably
required by the Title Company for such omission) are hereinafter referred to as
the “Permitted Exceptions.”
In no event shall Permitted Exceptions include liens, or documents evidencing
liens, securing any indebtedness, any mechanics’ or materialmen’s liens or any
claims or potential claims therefor covering the Property or any portion
thereof (“Seller Liens”),
each of which shall be paid in full by Seller and released at Closing. 

ARTICLE V

MANAGEMENT AGREEMENT

          At
or prior to the Closing, Seller shall assign and Buyer shall assume the
Existing Management Agreement, and Seller shall be solely responsible for all
claims and liabilities arising thereunder for all periods on or prior to the
Closing Date. As a condition to Closing, Buyer shall assume the Existing
Management Agreement with the Manager effective as of the Closing Date, which
assumption agreement (the “Assumption of Management Agreement”) shall 

10

contain terms and conditions
acceptable to Buyer (including, without limitation, such terms and conditions
as may be required to accommodate Buyer’s and/or Buyer’s Affiliates’ REIT
structure), or Buyer shall enter into a new management agreement with Manager,
if required by Manager, pursuant to the terms of the Existing Management
Agreement. Seller shall use best efforts to promptly provide all information
required by the Manager in connection with Buyer’s assumption of the Existing
Management Agreement, and Seller and Buyer shall diligently pursue obtaining
each the same. Seller shall be responsible for any key money repayment, if any,
required by Existing Manager as of the Closing Date. Any key money repayment
due as a result of the termination of the Existing Management Agreement
following the Closing Date or a new management agreement between Buyer and
Manager shall be the responsibility of Buyer. 

ARTICLE VI

BROKERS

          Seller
and Buyer each represents and warrants to the other that it has not engaged any
broker, finder or other party in connection with the transaction contemplated
by this Contract. Buyer and Seller each agree to save and hold the other
harmless from any and all losses, damages, liabilities, costs and expenses
(including, without limitation, attorneys’ fees) involving claims made by any
other agent, broker, or other person by or through the acts of Buyer or Seller,
respectively, in connection with this transaction.

ARTICLE VII

REPRESENTATIONS, WARRANTIES AND COVENANTS

          7.1
Seller’s Representations, Warranties and Covenants. Seller hereby
represents, warrants and covenants to Buyer as follows: 

               (a)
Authority; No Conflicts. Seller is a limited liability company duly
formed, validly existing and in good standing in the State of California.
Seller has obtained all necessary consents to enter into and perform this
Contract and is fully authorized to enter into and perform this Contract and to
complete the transactions contemplated by this Contract. No consent or approval
of any person, entity or governmental authority is required for the execution,
delivery or performance by Seller of this Contract, except as set forth in
Exhibit E, and this Contract is hereby binding and enforceable against Seller.
Neither the execution nor the performance of, or compliance with, this Contract
by Seller has resulted, or will result, in any violation of, or default under,
or acceleration of, any obligation under any existing corporate charter,
certificate of incorporation, bylaw, articles of organization, limited
liability company agreement or regulations, partnership agreement or other
organizational documents and under any, mortgage indenture, lien agreement,
promissory note, contract, or permit, or any judgment, decree, order,
restrictive covenant, statute, rule or regulation, applicable to Seller or to
the Hotel.  

               
(b) FIRPTA. Seller is not a foreign corporation, foreign partnership,
foreign trust or foreign estate (as those items are defined in the Internal
Revenue Code and Income Tax Regulations). 

11

               (c)
Bankruptcy. Neither Seller nor, to Seller’s knowledge, any of its
partners or members, is insolvent or the subject of any bankruptcy proceeding,
receivership proceeding or other insolvency, dissolution, reorganization or
similar proceeding. 

               (d)
Property Agreements. A complete list of all FF&E Leases, Service
Contracts and Leases (other than those entered into by the Manager on its own
behalf) used in or otherwise relating to the operation and business of the
Hotel is attached hereto as Exhibit D-1, and, to Seller’s knowledge, a complete
list of all other FF&E Leases, Service Contracts and Leases used in or
otherwise relating to the operation and business of the Hotel is attached
hereto as Exhibit D-2. The assets constituting the Property to be conveyed to
Buyer hereunder constitute all of the property and assets of Seller used in
connection with the operation and business of the Hotel. There are no leases,
license agreements, leasing agent’s agreements, equipment leases, building
service agreements, maintenance contracts, suppliers contracts, warranty
contracts, operating agreements, or other agreements (i) to which Seller is a
party or an assignee, or (ii) to Seller’s knowledge, binding upon the Hotel,
relating to the ownership, occupancy, operation, management or maintenance of
the Real Property, FF&E, Supplies or Tradenames, except for those Service
Contracts, Leases, Warranties and FF&E Leases disclosed on Exhibit D or to
be delivered to Buyer pursuant to Section 3.1. The Service Contracts, Leases,
Warranties and FF&E Leases disclosed on Exhibit D or to be delivered to
Buyer pursuant to Section 3.1 are in full force and effect, and no default has
occurred and is continuing thereunder and no circumstances exist which, with
the giving of notice, the lapse of time or both, would constitute such a
default. No party has any right or option to acquire the Hotel or any portion
thereof, other than Buyer.  

               (e)
Pending Claims. To Seller’s knowledge, there are no: (i) claims,
demands, litigation, proceedings or governmental investigations pending or
threatened against Seller, the Manager or any Affiliate of any of them
(collectively, “Seller Parties”)
or related to the business or assets of the Hotel, except as set forth on
Exhibit G attached hereto and incorporated herein by reference, (ii) special
assessments or extraordinary taxes except as set forth in the Title Commitment
or (iii) pending or threatened condemnation or eminent domain proceedings which
would affect the Property or any part thereof. To Seller’s knowledge, there are
no: pending arbitration proceedings or unsatisfied arbitration awards, or
judicial proceedings or orders respecting awards, which might become a lien on
the Property or any portion thereof, pending unfair labor practice charges or
complaints, unsatisfied unfair labor practice orders or judicial proceedings or
orders with respect thereto, pending charges or complaints with or by city,
state or federal civil or human rights agencies, unremedied orders by such
agencies or judicial proceedings or orders with respect to obligations under
city, state or federal civil or human rights or antidiscrimination laws or
executive orders affecting the Hotel, or other pending, actual or, to Seller’s
knowledge, threatened litigation claims, charges, complaints, petitions or
unsatisfied orders by or before any administrative agency or court which affect
the Hotel or might become a lien on the Hotel (collectively, the “Pending Claims”).  

               (f)
Environmental. With respect to environmental matters for the period of
Seller’s ownership of the Land, and to Seller’s knowledge for the period prior
to Seller first acquiring the Land, and except as disclosed in the reports and
documents set forth on Exhibit F attached hereto and incorporated herein
by reference: (i) there has been no Release or threat of 

12

Release of Hazardous
Materials in, on, under, to, from or in the area of the Real Property, (ii) no
portion of the Property is being used for the treatment, storage, disposal or
other handling of Hazardous Materials or machinery containing Hazardous
Materials other than standard amounts of cleaning supplies and chlorine for the
swimming pool, all of which are stored on the Property in strict accordance
with applicable Environmental Requirements and do not exceed limits permitted
under applicable laws, including without limitation Environmental Requirements,
(iii) no underground storage tanks are currently located on or in the Real
Property or any portion thereof, (iv) no environmental investigation,
administrative order, notification, consent order, litigation, claim, judgment
or settlement with respect to the Property or any portion thereof is pending or
threatened, (v) there is not currently and, to Seller’s knowledge, never has
been any mold, fungal or other microbial growth in or on the Real Property, or
existing conditions within buildings, structures or mechanical equipment
serving such buildings or structures, that could reasonably be expected to
result in material liability or material costs or expenses to remediate the
mold, fungal or microbial growth, or to remedy such conditions that could
reasonably be expected to result in such growth, and (vi) except as disclosed
on Exhibit F, there are no reports or other documentation regarding the
environmental condition of the Real Property in the possession of Seller or
Seller’s Affiliates, consultants, contractors or agents. As used in this
Contract: “Hazardous Materials”
means (1) “hazardous wastes” as defined by the Resource Conservation and
Recovery Act of 1976, as amended from time to time (“RCRA”), (2) “hazardous
substances” as defined by the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 (42 U.S.C. 9601 et seq.), as amended by
the Superfund Amendment and Reauthorization Act of 1986 and as otherwise
amended from time to time (“CERCLA”);
(3) “toxic substances” as defined by the Toxic Substances Control Act, as
amended from time to time (“TSCA”),
(4) “hazardous materials” as defined by the Hazardous Materials Transportation
Act, as amended from time to time (“HMTA”),
(5) asbestos, oil or other petroleum products, radioactive materials, urea
formaldehyde foam insulation, radon gas and transformers or other equipment
that contains dielectric fluid containing polychlorinated biphenyls and (6) any
substance whose presence is detrimental or hazardous to health or the
environment, including, without limitation, microbial or fungal matter or mold,
or is otherwise regulated by federal, state and local environmental laws
(including, without limitation, RCRA, CERCLA, TSCA, HMTA), rules, regulations
and orders, regulating, relating to or imposing liability or standards of
conduct concerning any Hazardous Materials or environmental, health or safety
compliance (collectively, “Environmental
Requirements”). As used in this Contract: “Release” means spilling, leaking,
pumping, pouring, emitting, emptying, discharging, injecting, escaping,
leaching, dumping or disposing.  

               (g)
Title and Liens. Except for the FF&E subject to the FF&E Leases
and any applicable Permitted Exceptions, Seller has good and marketable title
to the Personal Property, free and clear of all liens, claims, encumbrances or
other rights whatsoever (other than the Seller Liens to be released at
Closing), and there are no other liens, claims, encumbrances or other rights
pending or of which any Seller Party has received notice or which are otherwise
known to any Seller Party related to any other Personal Property. 

               (h)
Utilities. All appropriate utilities, including sanitary and storm
sewers, water, gas, telephone, cable and electricity, are, to Seller’s
knowledge, currently sufficient and 

13

available to service the
Hotel and all installation, connection or “tap-on”, usage and similar fees have
been paid. 

               (i)
Licenses, Permits and Approvals. Seller has not received any written
notice, and Seller has no knowledge that the Property fails to comply with all
applicable licenses, permits and approvals and federal, state or local
statutes, laws, ordinances, rules, regulations, requirements and codes
including, without limitation, those regarding zoning, land use, building,
fire, health, safety, environmental, subdivision, water quality, sanitation
controls and the Americans with Disabilities Act, and similar rules and
regulations relating and/or applicable to the ownership, use and operation of
the Property as it is now operated. Seller has received all licenses, permits
and approvals required or needed for the lawful conduct, occupancy and
operation of the business of the Hotel, and each license and permit is in full
force and effect, and will be received and in full force and effect as of the Closing.
No licenses, permits or approvals necessary for the lawful conduct, occupancy
or operation of the business of the Hotel, to Seller’s knowledge requires any
approval of a governmental authority for transfer of the Property except as set
forth in Exhibit E.  

               (j)
Financial Statements. To the extent such statements have been prepared
as a result of the operations of the Hotel, Seller has delivered copies of all
prior and current (i) Financial Statements for the Hotel, (ii) operating statements
prepared by the Manager for the Hotel, and (iii) monthly financial statements
prepared by the Manager for the Hotel. Each of such statements is, to Seller’s
knowledge, complete and accurate in all material respects and, except in the
case of budgets prepared in advance of the applicable operating period to which
such budgets relate, fairly presents the results of operations of the Hotel for
the respective periods represented thereby. Seller has relied upon the
Financial Statements in connection with its ownership and operation of the
Hotel, and there are no independent audits or financial statements prepared by
third parties relating to the operation of the Hotel other than the Financial
Statements prepared by or on behalf of the Manager, all of which have been
provided to Buyer. 

               (k)
Employees. To Seller’s knowledge, all employees employed at the Hotel
are the employees of the Manager. There are, to Seller’s knowledge, no (i)
unions organized at the Hotel, (ii) union organizing attempts, strikes,
organized work stoppages or slow downs, or any other labor disputes pending or
threatened with respect to any of the employees at the Hotel, or (iii)
collective bargaining or other labor agreements to which Seller or the Manager
or the Hotel is bound with respect to any employees employed at the Hotel. 

               (l)
Operations. The Hotel has at all times been operated by Manager in
accordance with all applicable laws, rules, regulations, ordinances and codes. 

               (m)
Existing Management Agreement. Seller has furnished to Buyer true and
complete copies of the Existing Management Agreement, which constitutes the
entire agreement of the parties with respect to the subject matter thereof and
which have not been amended or supplemented in any respect. There are no other
management agreements, franchise agreements, license agreements or similar
agreements for the operation or management of the Hotel or relating to the
Brand, to which Seller is a party or which are binding upon the Property,
except for the Existing Management Agreement. To Seller’s knowledge, the
Improvements comply 

14

with, and the Hotel is being
operated in accordance with, all requirements of such Existing Management
Agreement and all other requirements of the Manager, including all “brand
standard” requirements of the Manager. The Existing Management Agreement is in
full force and effect, and shall remain in full force and effect until the
termination of the Existing Management Agreement at Closing if Buyer and Manager
execute a new management agreement as provided in Article V hereof. To Seller’s
knowledge, no default has occurred and is continuing under the Existing
Management Agreement, and no circumstances exist which, with the giving of
notice, the lapse of time or both, would constitute such a default. 

	
  

 	
  

 
	
  

 	
 (n) Construction of Hotel. 

 
	
  

 	
  

 
	
  

 	
                     (i)
 The Hotel has been constructed in a good and workmanlike manner without
 encroachments and in accordance in all material respects with all building
 permits and certificates of occupancy therefor and all applicable zoning,
 platting, subdivision, health, safety and similar laws, rules, regulations,
 ordinances and codes.

 
	
  

 	
  

 
	
  

 	
                     (ii)
 The Personal Property is in good condition and operating order. 

 
	
  

 	
  

 
	
  

 	
                     (iii)
 Necessary easements for ingress and egress, drainage, signage and utilities
 serving the Hotel have either been dedicated to the public, conveyed to the
 appropriate utility or will be conveyed to Buyer along with the Property. 

 

          7.2
Buyer’s Representations, Warranties and Covenants. Buyer represents,
warrants and covenants: 

               (a)
Authority. Buyer is a corporation duly formed, validly existing and in
good standing in the Commonwealth of Virginia. Buyer has received or will have
received by the applicable Closing Date all necessary authorization of the
Board of Directors of Buyer to complete the transactions contemplated by this
Contract. No other consent or approval of any person, entity or governmental
authority is required for the execution, delivery or performance by Buyer of
this Contract, and this Contract is hereby binding and enforceable against
Buyer. 

               (b)
Bankruptcy. Buyer is not insolvent nor the subject of any bankruptcy
proceeding, receivership proceeding or other insolvency, dissolution,
reorganization or similar proceeding. 

               (c)
Non-Contravention. The execution and delivery of this Contract and the
instruments and documents referenced in this Contract by Buyer and the
consummation by Buyer of the transactions contemplated hereby will not violate
any judgment, order, injunction, decree, regulation or ruling of any court or
governmental entity or conflict with, result in a breach of, or constitute a
default under the organizational documents of Buyer, any note or other evidence
of indebtedness, any mortgage, deed of trust or indenture, or any lease or
other material agreement or instrument to which Buyer is a party or by which it
is bound. 

15

                    (d)
Consents. No consent, waiver, approval or
authorization is required from any person (that has not already been obtained)
in connection with the execution and delivery of this Contract and the
instruments and documents referenced in this Contract by Buyer or the
performance by Buyer of the transactions contemplated hereby.

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

                    (f)
Brokerage.
There are no claims for brokerage commissions, finders’ fees, or similar
compensation in connection with this Contract based on any arrangement or
agreement entered into by Buyer and binding upon Seller other than as disclosed
in this Contract. Buyer has not paid or
given, and will not pay or give, any other third person any money or other
consideration for obtaining this Contract, other than the normal cost of
conducting business and the cost of professional services such as architects, engineers,
consultants and attorneys.

                    (g)
No Adverse Conditions. There are no adverse conditions or
circumstances, no pending or, to the best of Buyer’s knowledge, threatened
litigation, no governmental action, nor any other condition which could
materially affect the ability of Buyer to carry out its obligations hereunder
and the Existing Management Agreement.

                    (h)
Information Accurate. All reports, documents, instruments,
information and forms of evidence delivered by or on behalf of Buyer to Seller
concerning or related to this Contract and the transactions contemplated hereby
are, to the best of Buyer’s knowledge, accurate, correct and sufficiently
complete at the time of submission to give Seller true and accurate knowledge
of the subject matter, and do not contain any misrepresentations or material
omissions. 

                    (i)
No Contingent Obligations. Buyer has no contingent obligations or
any other contracts the performance or nonperformance of which could affect the
ability of Buyer to carry out its obligations hereunder or under the Existing
Management Agreement.

                    (j)
No Legal Proceedings.
There are no legal proceedings either pending or, to the best of Buyer’s
knowledge, threatened, to which Buyer is or may be made a party, or the
Property, is or may become subject, which has not been fully disclosed in the
documents submitted to Seller and which could materially affect the ability of
Buyer to carry out its obligations hereunder or under the Existing Management
Agreement.

          7.3
Survival. All of the
representations and warranties are true, correct and complete in all material
respects as of the date hereof and the statements set forth therein (without
qualification or limitation as to a party’s knowledge thereof except as
expressly provided for in this Article VII) shall be true, correct and complete
in all material respects as of the Closing Date. All of the representations and warranties made herein shall
survive Closing for a period of 

16

two (2) years
and shall not be deemed to merge into or be waived by the Deed or any other
closing documents.

ARTICLE VIII

ADDITIONAL COVENANTS

          8.1
Subsequent Developments. After
the date of this Contract and until the Closing Date, Seller shall use best
efforts to keep Buyer fully informed of all subsequent developments of which
Seller has knowledge (“Subsequent Developments”) which would
cause any of Seller’s representations or warranties contained in this Contract
to be no longer accurate in any material respect.

          8.2
Operations. From and after the
date hereof through the Closing on the Property, Seller shall comply with the
Existing Management Agreement and keep the same in full force and effect and
shall perform and comply with all of the following subject to and in accordance
with the terms of such agreements:

                    (a)
Continue to maintain the Property generally in accordance with past practices
of Seller and pursuant to and in compliance with the Existing Management
Agreement, including, without limitation, (i) using reasonable efforts to keep
available the services of all present employees at the Hotel and to preserve
its relations with guests, suppliers and other parties doing business with
Seller with respect to the Hotel, (ii) accepting booking contracts for the use
of the Hotel’s facilities retaining such bookings in accordance with the terms
of the Existing Management Agreement, (iii) maintaining the current level of
advertising and other promotional activities for the Hotel’s facilities, (iv)
maintaining the present level of insurance with respect to the Hotel in full
force and effect until the Closing Date for the Hotel and (v) remaining in
compliance in all material respects with all current Licenses;

                    (b)
Keep, observe, and perform in all material respects all its obligations under
and pursuant to the Leases, the Service Contracts, the FF&E Leases, the
Existing Management Agreement, the Contracts, Plans and Specs, the Warranties
and all other applicable contractual arrangements relating to the Hotel;

                    (c)
Not cause or permit the removal of FF&E from the Hotel except for the
purpose of discarding worn and valueless items that have been replaced with
FF&E of equal or better quality; timely make all repairs, maintenance, and
replacements to keep all FF&E and all other Personal Property and all Real
Property in good operating condition; keep and maintain the Hotel in a good
state of repair and condition, reasonable and ordinary wear and tear excepted;
and not commit waste of any portion of the Hotel;

                    (d)
Maintain the levels and quality of the Personal Property generally at the
levels and quality existing on the date hereof and keep merchandise, supplies
and inventory adequately stocked, consistent with good business practice, as if
the sale of the Hotel hereunder were not to occur, including, without
limitation, maintaining linens and bath towels at least at a 2-par level for
all suites or rooms of the Hotel;

                    (e)
Advise Buyer promptly of any litigation, arbitration, or administrative hearing
before any court or governmental agency concerning or affecting the Hotel which
is 

17

instituted or
threatened after the date of this Contract or if any representation or warranty
contained in this Contract shall become false;

                    (f)
Not take, or purposefully omit to take, any action that would have the effect
of violating any of the representations, warranties, covenants or agreements of
Seller contained in this Contract;

                    (g)
Pay or cause to be paid all taxes, assessments and other impositions levied or
assessed on the Hotel or any part thereof prior to the delinquency date, and
comply with all federal, state, and municipal laws, ordinances, regulations and
orders relating to the Hotel;

                    (h)
Not sell or assign, or enter into any agreement to sell or assign, or create or
permit to exist any lien or encumbrance (other than a Permitted Exception) on,
the Property or any portion thereof; and

                    (i)
Not allow any permit, receipt, license, franchise or right currently in
existence with respect to the operation, use, occupancy or maintenance of the
Hotel to expire, be canceled or otherwise terminated.

          Seller
shall promptly furnish to Buyer copies of all new, amended or extended FF&E
Leases, Service Contracts, Leases and other contracts or agreements (other than
routine hotel room bookings and other agreements entered into in the ordinary
course of business) relating to the Hotel and entered into by the Manager prior
to Closing; provided, however, that in the case of any of the foregoing entered
into by the Manager on its own behalf, only to the extent Seller has knowledge
thereof or a copy of which is obtainable from the Manager. Buyer shall have the right to extend the
Review Period for a period of five (5) Business Days in order to review any of
the foregoing which are material in nature and that are not received by Buyer
at least five (5) Business Days prior to the expiration of the Review
Period. Seller shall not, without first
obtaining the written approval of Buyer, which approval shall not be
unreasonably withheld, enter into any new FF&E Leases, Service Contracts,
Leases or other contracts or agreements related to the Hotel (other than
routine hotel room bookings), or extend any existing such agreements, unless
such agreements (x) can be terminated, without penalty, upon thirty (30) days’
prior notice or (y) will expire prior to the Closing Date.

          8.3
Third Party Consents. Prior to
the Closing Date, Seller shall, at its expense, (i) obtain any and all third
party consents and approvals (x) required in order to transfer the Hotel to
Buyer, or (y) which, if not obtained, would materially adversely affect the
operation of the Hotel, including, without limitation, all consents and
approvals referred to on Exhibit E and (ii) use best efforts to obtain
all other third party consents and approvals (all of such consents and
approvals in (i) and (ii) above being referred to collectively as, the “Third
Party Consents”).

          8.4
Employees. Subject to the
approval of the Manager, Buyer and its employees, representatives and agents
shall have the right to communicate with the Hotel staff and the Manager’s
staff, including without limitation the general manager, the director of sales,
the engineering staff and other key management employees of the Hotel, at any
time before Closing. Buyer shall not
interfere with the operations of the Hotel while engaging in such communication

18

in a manner that materially adversely affects the operation of any Property or
the Existing Management Agreement.

          8.5
Estoppel Certificates. Seller
shall obtain from (i) each tenant under any Lease affecting the Hotel (but not
from current or prospective occupants of hotel rooms and suites within the
Hotel) and (ii) each lessor under any FF&E Lease for the Hotel identified
by Buyer as a material FF&E Lease, the estoppel certificates substantially
in the forms provided by Buyer to Seller during the Review Period, and deliver
to Buyer not less than five (5) days before the Closing.

          8.6
Access to Financial Information.
To the extent such information has been prepared as a result of the
operations of the Hotel, Buyer’s representatives shall have access to, and
Seller and its Affiliates shall cooperate with Buyer and furnish upon request,
all financial and other information relating to the Hotel’s operations to the extent
necessary to enable Buyer’s representatives to prepare audited financial
statements in conformity with Regulation S-X of the Securities and Exchange
Commission (the “SEC”) and other applicable rules and
regulations of the SEC and to enable them to prepare a registration statement,
report or disclosure statement for filing with the SEC on behalf of Buyer or
its Affiliates, whether before or after Closing and regardless of whether such
information is included in the Records to be transferred to Buyer hereunder. Seller shall also provide to Buyer’s
representative a signed representation letter in form and substance reasonably
acceptable to Seller sufficient to enable an independent public accountant to
render an opinion on the financial statements related to the Hotel. Buyer will reimburse Seller for costs
reasonably incurred by Seller to comply with the requirements of this Section
and the preceding sentence to the extent that Seller is required to incur costs
furnishing information or costs not in the ordinary course of business for
third parties to provide such representation letters. The provisions of this Section shall survive Closing or
termination of this Contract.

          8.7
Bulk Sales. At Seller’s risk and
expense, Seller shall take all steps necessary to comply with the requirements
of a transferor under all bulk transfer laws, if any, that are applicable to
the transactions contemplated by this Contract. 

          8.8
Indemnification. If the
transactions contemplated by this Contract are consummated as provided herein:

                    (a)
Indemnification of Buyer.
Without in any way limiting or diminishing the warranties,
representations or agreements herein contained or the rights or remedies
available to Buyer for a breach hereof, Seller hereby agrees to indemnify,
defend and hold harmless Buyer and its respective designees, successors and
assigns from and against all losses, judgments, liabilities, claims, damages or
expenses (including reasonable attorneys’ fees) of every kind, nature and
description in existence before, on or after Closing, whether known or unknown,
absolute or continent, joint or several, arising out of or relating to:

	
  

 	
  

 
	
  

 	
                               (i)
 any claim made or asserted against Buyer or any of the Property by a creditor
 of Seller, including any claims based on or alleging a violation of any bulk
 sales act or other similar laws;

 

19

	
  

 	
  

 
	
  

 	
                               (ii)
 the breach of any representation, warranty, covenant or agreement of Seller
 contained in this Contract;

 
	
  

 	
  

 
	
  

 	
                               (iii)
 any liability or obligation of Seller not expressly assumed by Buyer pursuant
 to this Contract;

 
	
  

 	
  

 
	
  

 	
                               (iv)
 any claim made or asserted by an employee of Seller arising out of Seller’s
 decision to sell the Property; and

 
	
  

 	
  

 
	
  

 	
                               (v)
 the conduct and operation by or on behalf of Seller of its Hotel or the
 ownership, use or operation of its Property prior to Closing.

 

                    (b)
Indemnification of Seller.
Without in any way limiting or diminishing the warranties,
representations or agreements herein contained or the rights or remedies
available to Seller for a breach hereof, Buyer hereby agrees, with respect to
this Contract, to indemnify, defend and hold harmless Seller from and against
all losses, judgments, liabilities, claims, damages or expenses (including
reasonable attorneys’ fees) of every kind, nature and description in existence
before, on or after Closing, whether known or unknown, absolute or contingent,
joint or several, arising out of or relating to:

	
  

 	
  

 
	
  

 	
                               (i)
 the breach of any representation, warranty, covenant or agreement of Buyer
 contained in this Contract; 

 
	
  

 	
  

 
	
  

 	
                               (ii)
 the conduct and operation by Buyer of its business at the Hotel after the
 Closing; and

 
	
  

 	
  

 
	
  

 	
                               (iii)
 any liability or obligation of Buyer expressly assumed by Buyer at Closing.

 

                    (c)
Indemnification Procedure for Claims of Third Parties. Indemnification, with respect to claims
resulting from the assertion of liability by those not parties to this Contract
(including governmental claims for penalties, fines and assessments), shall be
subject to the following terms and conditions:

	
  

 	
  

 
	
  

 	
                               (i)
 The party seeking indemnification (the “Indemnified Party”) shall give prompt
 written notice to the party or parties from which it is seeking
 indemnification (the “Indemnifying Party”) of any assertion of liability by a
 third party which might give rise to a claim for indemnification based on the
 foregoing provisions of this Section 8.8, which notice shall state the nature
 and basis of the assertion and the amount thereof, to the extent known; provided,
 however, that no delay on the part of the Indemnified Party in giving notice
 shall relieve the Indemnifying Party of any obligation to indemnify unless
 (and then solely to the extent that) the Indemnifying Party is prejudiced by
 such delay.

 
	
  

 	
  

 
	
  

 	
                               (ii) If
 in any action, suit or proceeding (a “Legal Action”) the relief sought is
 solely the payment of money damages, and if the Indemnifying Party
 specifically agrees in writing to indemnify such Indemnified Party with
 respect thereto and demonstrates to the reasonable satisfaction of such
 Indemnified Party its financial

 

20

	
  

 	
  

 
	
  

 	
 ability to do so, the Indemnifying Party shall have
 the right, commencing thirty (30) days after such notice, at its option, to
 elect to settle, compromise or defend, pursuant to this paragraph, by its own
 counsel and at its own expense, any such Legal Action involving such
 Indemnified Party’s asserted liability. If the Indemnifying Party does not
 undertake to settle, compromise or defend any such Legal Action, such
 settlement, compromise or defense shall be conducted in the sole discretion
 of such Indemnified Party, but such Indemnified Party shall provide the
 Indemnifying Party with such information concerning such settlement,
 compromise or defense as the Indemnifying Party may reasonably request from
 time to time. If the Indemnifying Party undertakes to settle, compromise or
 defend any such asserted liability, it shall notify such Indemnified Party in
 writing of its intention to do so within thirty (30) days of notice from such
 Indemnified Party provided above.

 
	
  

 	
  

 
	
  

 	
                               (iii)
 Notwithstanding the provisions of the previous subsection of this Contract,
 until the Indemnifying Party shall have assumed the defense of the Legal
 Action, the defense shall be handled by the Indemnified Party. Furthermore,
 (x) if the Indemnified Party shall have reasonably concluded that there are
 likely to be defenses available to it that are different from or in addition
 to those available to the Indemnifying Party; (y) if the Legal Action
 involves other than money damages and seeks injunctive or other equitable
 relief; or (z) if a judgment against Buyer, as the Indemnified Party, in the
 Legal Action will, in the good faith opinion of Buyer, establish a custom or
 precedent which will be adverse to the best interest of the continuing
 business of the Hotel, the Indemnifying Party, shall not be entitled to
 assume the defense of the Legal Action and the defense shall be handled by
 the Indemnified Party, provided that, in the case of clause (z), the
 Indemnifying Party shall have the right to approve legal counsel selected by
 the Indemnified Party, such approval not to be unreasonably withheld, delayed
 or conditioned. If the defense of the Legal Action is handled by the
 Indemnified Party under the provisions of this subsection, the Indemnifying
 Party shall pay all legal and other expenses reasonably incurred by the
 Indemnified Party in conducting such defense.

 
	
  

 	
  

 
	
  

 	
                               (iv)
 In any Legal Action initiated by a third party and defended by the Indemnified
 Party (w) the Indemnified Party shall have the right to be represented by
 advisory counsel and accountants, at its own expense, (x) the Indemnifying
 Party shall keep the Indemnified Party fully informed as to the status of
 such Legal Action at all stages thereof, whether or not the Indemnified Party
 is represented by its own counsel, (y) the Indemnifying Party shall make
 available to the Indemnified Party and its attorneys, accounts and other
 representatives, all books and records of Seller relating to such Legal
 Action and (z) the parties shall render to each other such assistance as may
 be reasonably required in order to ensure the proper and adequate defense of
 such Legal Action.

 
	
  

 	
  

 
	
  

 	
                               (v)
 In any Legal Action initiated by a third party and defended by the Indemnifying
 Party, the Indemnifying Party shall not make settlement of any claim without
 the written consent of the Indemnified Party, which consent shall not be
 unreasonably withheld. Without limiting the generality of the foregoing, it
 shall not be deemed unreasonable to withhold consent to a settlement
 involving injunctive or other equitable relief against Buyer or its
 respective assets, employees, Affiliates or business, 

 

21

	
  

 	
  

 
	
  

 	
 or relief which Buyer
 reasonably believes could establish a custom or precedent which will be
 adverse to the best interests of its continuing business.

 

          8.9
Escrow Funds. To provide for the timely payment of any
post-closing claims by Buyer against Seller hereunder, at Closing, Seller shall
deposit an amount equal to Two Hundred Thousand and No/100 Dollars
($200,000.00) (the “Escrow Funds”) which shall be withheld
from the Purchase Price payable to Seller and shall be deposited for a period
of one (1) year in an escrow account with the Title Company pursuant to an
escrow agreement reasonably satisfactory in form and substance to Buyer and
Seller (the “Post-Closing Agreement”), which escrow and Post-Closing
Agreement shall be established and entered into at Closing and shall be a
condition to Buyer’s obligations under this Contract. If no claims have been
asserted by Buyer against Seller, or all such claims have been satisfied,
within such 1-year period, the Escrow Funds deposited by Seller shall be
released to Seller. Furthermore, if no claims have been asserted by Buyer against
Seller, or if claims have been satisfied up to an aggregate of $100,000 within
six (6) months following Closing, then a portion of the Escrow Funds equal to
the positive difference between $100,000 and the amount of satisfied claims
shall be released to Seller upon such six-month expiration.

          8.10
Liquor Licenses. Seller represents and warrants that Manager
currently holds any and all alcohol licenses in its own or its subsidiary’s
name. 

          8.11
Construction Warranty. At the Closing, to the extent assignable,
Seller shall assign to Buyer all construction warranties with respect to the
Hotel, which assignment shall be in form and substance reasonably satisfactory
to Buyer, including a warranty by the Contractor, for the period ending not sooner
than one (1) year after the date the Hotel is Substantially Completed, in the
form of the warranty attached hereto as Exhibit I (the “Construction
Warranty”). 

          8.12
Punch List. Upon notification from the Contractor that the Hotel
is Substantially Completed and ready for inspection, Seller shall prepare a
“punch list” with the assistance of the Architect and the Franchisor. Seller
acknowledges that final acceptance of the work on the Hotel shall be made only
with the approval of Seller, Buyer and the Manager. The costs of completing the
Punch List Items that are not completed as of the date of Closing, as
reasonably estimated by the Seller with the approval of Buyer, such approval
not to be unreasonably withheld, plus fifty percent (50%) of such costs, shall
be retained by the Title Company from the Purchase Price and shall be disbursed
to Seller only upon Buyer’s reasonable determination that all of the Punch List
Items have been satisfactorily completed. Seller shall correct or complete all
Punch List Items, or cause the same to be corrected or completed, at Seller’s
expense, with all diligence and in any event within sixty (60) days after
Substantial Completion of the Hotel.

22

ARTICLE IX

CONDITIONS FOR CLOSING

          9.1
Buyer’s Conditions for Closing. Unless otherwise waived in writing, and
without prejudice to Buyer’s right to cancel this Contract during the Review
Period, the duties and obligations of Buyer to proceed to Closing under the
terms and provisions of this Contract are and shall be expressly subject to
strict compliance with, and satisfaction or waiver of, each of the conditions
and contingencies set forth in this Section 9.1, each of which shall be deemed
material to this Contract. In the event of the failure of any of the conditions
set forth in this Section 9.1 or of any other condition to Buyer’s obligations
provided for in this Contract, which condition is not waived in writing by
Buyer, Buyer shall have the right at its option to declare this Contract
terminated, in which case the Earnest Money Deposit and any interest thereon
shall be immediately returned to Buyer and each of the parties shall be
relieved from further liability to the other, except as otherwise expressly
provided herein, with respect to this Contract. 

                    (a)
All of Seller’s representations and warranties contained in or made pursuant to
this Contract shall be true and correct in all material respects as if made
again on the Closing Date. 

                    (b)
Buyer shall have received all of the instruments and conveyances listed in
Section 10.2. 

                    (c)
Seller shall have performed, observed and complied in all material respects
with all of the covenants, agreements, closing requirements and conditions
required by this Contract to be performed, observed and complied with by
Seller, as and when required hereunder. 

                    (d)
All Liquor Licenses in the name of Manager shall be in full force and effect
and shall remain in full force and effect following Closing, and Buyer shall
have received satisfactory evidence thereof. 

                    (e)
Third Party Consents in form and substance satisfactory to Buyer shall have
been obtained and furnished to Buyer. 

                    (f)
The Escrow Funds shall have been deposited in the escrow account pursuant to
the Post-Closing Agreement and the parties thereto shall have entered into the
Post-Closing Agreement. 

                    (g)
Buyer and the Manager shall have executed and delivered the Assumption of
Management Agreement, or Buyer shall have entered into a new management
agreement with Manager, if required by Manager, in any case upon terms and
conditions acceptable to Buyer in its reasonable discretion (including, without
limitation, such terms and conditions as may be required to accommodate Buyer’s
and/or Buyer’s Affiliates’ REIT structure). 

                    (h)
The Hotel shall be substantially complete and shall be open for business to the
public in accordance with all applicable Legal Requirements and as permitted by
the Manager. 

23

                    (i)
Seller has provided Title Company with all necessary documents, indemnities and
information sufficient to enable Title Company to issue the Title Policy to
Buyer free of any mechanics’ or materialmen’s liens or exceptions therefor. 

          9.2
Seller’s Conditions for Closing. Unless otherwise waived in writing, and
without prejudice to Seller’s right to cancel this Contract during the Review
Period, the duties and obligations of Seller to proceed to Closing under the
terms and provisions of this Contract are and shall be expressly subject to
strict compliance with, and satisfaction or waiver of, each of the conditions
and contingencies set forth in this Section 9.2, each of which shall be deemed
material to this Contract. In the event of the failure of any of the conditions
set forth in this Section 9.2, which condition is not waived in writing by
Seller, Seller shall have the right at its option to declare this Contract
terminated and null and void, in which case the remaining Earnest Money Deposit
and any interest thereon shall be immediately returned to Buyer and each of the
parties shall be relieved from further liability to the other, except as
otherwise expressly provided herein. 

                    (a)
All of Buyer’s representations and warranties contained in or made pursuant to
this Contract shall be true and correct in all material respects as if made
again on the Closing Date. 

                    (b)
Seller shall have received all of the money, instruments and conveyances listed
in Section 10.3. 

                    (c) Buyer
shall have performed, observed and complied in all material respects with all
of the covenants, agreements, closing requirements and conditions required by
this Contract to be performed, observed and complied with by Buyer, as and when
required hereunder. 

                    (d)
Seller shall have received the waiver of all rights to purchase the Property
held by third parties, including without limitation, options, rights of first
refusal, rights of repurchase, and rights of first opportunity, and shall have
received the approval to the transfer of the Property to Buyer from any
applicable third party holding approval rights as to the transfer of the
Property; provided, however, this condition to closing shall be satisfied or
waived by Seller on or before the expiration of the Review Period and shall be
of no further force and effect following the expiration of the Review Period. 

ARTICLE X

CLOSING AND CONVEYANCE

          10.1
Closing. Unless otherwise agreed by Buyer and Seller, the Closing on the
Property shall occur on November 28, 2011 provided that all conditions to
Closing by Buyer hereunder have been satisfied. The date on which the Closing
is to occur as provided in this Section 10.1, or such other date as may be
agreed upon by Buyer and Seller, is referred to in this Contract as the “Closing Date” for the Property. The
Closing shall be held at 10:00 a.m. at the offices of the Title Company, or as
otherwise determined by Buyer and Seller. 

          10.2
Deliveries of Seller. At Closing, Seller shall deliver to Buyer the
following, and, as appropriate, all instruments shall be properly executed and
conveyance instruments to be 

24

acknowledged
in recordable form (the terms, provisions and conditions of all instruments not
attached hereto as Exhibits shall be mutually agreed upon by Buyer and Seller
prior to such Closing): 

                    (a)
Deed. A Grant Deed conveying to Buyer fee simple title to the Real
Property, subject only to the Permitted Exceptions (the “Deed”). 

                    (b)
Bills of Sale. Bills of sale to Buyer and/or its designated Lessee,
conveying title to the tangible Personal Property (other than the alcoholic
beverage inventories, which, at Buyer’s election, shall be transferred by
Seller to the Manager as holder of the Liquor Licenses required for operation
of the Hotel). 

                    (c)
Existing Management Agreement. The termination of the Existing
Management Agreement, if Buyer and Manager enter into a new Management
Agreement, otherwise, if Buyer and Manager enter into the Assumption of
Management Agreement, then Seller shall execute whatever documents are required
of Manager to evidence the termination of the Existing Management Agreement
vis-à-vis Seller and Manager. 

                    (d)
General Assignments. Assignments of all of Seller’s right, title and
interest in and to all FF&E Leases, Service Contracts and Leases identified
on Exhibit D hereto (the “Hotel Contracts”).
The assignment shall also be a general assignment and shall provide for the
assignment of all of Seller’s right, title and interest in all Records,
Warranties, Licenses, Tradenames, Contracts, Plans and Specs and all other
intangible Personal Property applicable to the Hotel. 

                    (e)
FIRPTA; 1099. A FIRPTA Affidavit or Transferor’s Certificate of
Non-Foreign Status as required by Section 1445 of the Internal Revenue Code and
an IRS Form 1099. 

                    (f)
Title Company Documents. All affidavits, gap indemnity agreements and
other documents reasonably required by the Title Company. At Buyer’s sole
expense, Buyer shall have obtained an irrevocable commitment directly from the
Title Company (or in the event the Title Company is not willing to issue said
irrevocable commitment, then from such other national title company as may be
selected by either Buyer or Seller) for issuance of an Owner’s Policy of Title
Insurance to Buyer insuring good and marketable fee simple absolute title to
the Real Property constituting part of the Property, subject only to the
Permitted Exceptions in the amount of the Purchase Price. 

                    (g)
Possession; Estoppel Certificates. Possession of the Property, subject
only to rights of guests in possession and tenants pursuant to written leases
included in the Leases, and estoppel certificates from tenants under Leases and
the lessors under FF&E Leases in form and substance reasonably acceptable
to Buyer. 

                    (h)
Vehicle Titles. The necessary certificates of titles duly endorsed for
transfer together with any required affidavits and other documentation
necessary for the transfer of title or assignment of leases from Seller to
Buyer of any motor vehicles used in connection with the Hotel’s operations. 

25

                    (i)
Authority Documents. Certified copy of resolutions of the Board of
Directors of Seller authorizing the sale of the Property contemplated by this
Contract, and/or other evidence reasonably satisfactory to Buyer and the Title
Company that the person or persons executing the closing documents on behalf of
Seller have full right, power and authority to do so, along with a certificate
of good standing of Seller from the State in which the Property is located. 

                    (j)
Miscellaneous. Such other instruments as are contemplated by this
Contract to be executed or delivered by Seller, reasonably required by Buyer or
the Title Company, or customarily executed in the jurisdiction in which the
Hotel is located, to effectuate the conveyance of property similar to the
Hotel, with the effect that, after the Closing, Buyer will have succeeded to
all of the rights, titles, and interests of Seller related to the Hotel and
Seller will no longer have any rights, titles, or interests in and to the
Hotel. 

                    (k)
Plans, Keys, Records, Etc. To the extent not previously delivered to and
in the possession of Buyer, all Contracts, Plans and Specs, all keys for the
Hotel (which keys shall be properly tagged for identification), all Records,
including, without limitation, all Warranties, Licenses, Leases, FF&E
Leases and Service Contracts for the Hotel. 

                    (l)
Closing Statements. Seller’s Closing Statement, and a certificate
confirming the truth of Seller’s representations and warranties hereunder as of
the Closing Date. 

          10.3
Buyer’s Deliveries. At Closing of the Hotel, Buyer shall deliver the
following: 

                    (a)
Purchase Price. The balance of the Purchase Price, adjusted for the
adjustments provided for in Section 12.1, below, and less any sums to be
deducted therefrom as provided in Section 2.4. 

                    (b)
Authority Documents. Certified copy of resolutions of the Board of
Directors of Buyer authorizing the purchase of the Hotel contemplated by this
Contract, and/or other evidence satisfactory to Seller and the Title Company
that the person or persons executing the closing documents on behalf of Buyer
have full right, power and authority to do so. 

                    (c)
Miscellaneous. Such other instruments as are contemplated by this
Contract to be executed or delivered by Buyer, reasonably required by Seller or
the Title Company, or customarily executed in the jurisdiction in which the
Hotel is located, to effectuate the conveyance of property similar to the
Hotel, with the effect that, after the Closing, Buyer will have succeeded to
all of the rights, titles, and interests of Seller related to the Hotel and
Seller will no longer have any rights, titles, or interests in and to the
Hotel. 

                    (d)
Closing Statements. Buyer’s Closing Statement, and a certificate
confirming the truth of Buyer’s representations and warranties hereunder as of
the Closing Date. 

26

ARTICLE XI

COSTS

          All
Closing costs shall be paid as set forth below: 

          11.1
Seller’s Costs. In connection with the sale of the Property contemplated
under this Contract, Seller shall be responsible for all transfer and
recordation taxes, including, without limitation, all transfer, mansion, sales,
use or bulk transfer taxes or like taxes on or in connection with the transfer
of the Personal Property constituting part of the Property pursuant to the Bill
of Sale, in each case except as otherwise provided in Section 12, and all
accrued taxes of Seller prior to Closing and income, sales and use taxes and
other such taxes of Seller attributable to the sale of the Property to Buyer.
Seller shall be responsible for x) one-half of the Escrow Agent’s escrow fee,
(y) the transfer taxes associated with the transaction, and (z) any additional
costs and charges customarily charged to Sellers in accordance with common
escrow practices in the county in which the Property is located, other than
those costs and charges specifically required to be paid by Buyer hereunder.
Seller shall be responsible for any key money repayment, if any, required by
Existing Manager as of the Closing Date. Seller shall also be responsible for any
charges, reimbursements, fees, costs or expenses imposed or due to Manager or
its affiliates related to training, equipping, staffing, or otherwise related
to the pre-opening and opening of the Hotel whether such are evidenced by
invoices delivered prior to or following Closing. Seller shall also be
responsible for any fees for the performance of the property improvement plan
(PIP) review and report by the Manager on or prior to the Closing Date and the
cost of completing the PIP items, as well as costs and expenses of its
attorneys, accountants, appraisers and other professionals, consultants and
representatives. If there is a PIP required by the Manager on or prior to the
Closing Date, the cost of completion shall be credited by Seller to Buyer at
Closing. If there are any items required by the Manager or Marriott
International, Inc. on or prior to the Closing Date to be completed, for
example, any items disclosed by or contained in the Authority to Open Letter
issued by Marriott International, Inc. Any FF&E escrows held by Lender or
Manager shall be credited to Buyer at Closing without Buyer having to fund
same. Seller shall also be responsible for payment of all prepayment penalties
and other amounts payable in connection with the pay-off of any liens and/or
indebtedness encumbering the Property. 

          11.2
Buyer’s Costs. In connection with the purchase of the Property
contemplated under this Contract, Buyer shall be responsible for the costs and
expenses of its attorneys, accountants and other professionals, consultants and
representatives. Buyer shall pay (x) one-half of the Escrow Agent’s escrow fee,
(y) costs and expenses of preparation of the title insurance commitment and the
issuance of the title insurance policy contemplated by Article IV or additional
endorsements Buyer requests in accordance with Article IV, and (z) any
additional costs and charges customarily charged to buyers in accordance with
common escrow practices in the county in which the Property is located, other
than those costs and charges specifically required to be paid by Seller
hereunder. In addition to the foregoing, Buyer shall be responsible for all
costs relating to the preparation of or any work related to any ALTA or other
surveys that may be required for issuance of the Title Policy. Buyer shall also
be responsible for the costs and expenses in connection with the assignment of
the Existing Management Agreement, or the costs and expenses in connection with
a new management agreement with Manager, if required 

27

by Manager,
pursuant to the terms of the Existing Management Agreement. Buyer shall be
responsible for the key money reimbursements, if any, related to the
termination by Buyer of the Existing Management Agreement as provided in the
Existing Management Agreement. Buyer shall also be responsible for the costs
and expenses in connection with the preparation of any environmental report,
any update to the survey and the per page recording charges and clerk’s fee for
the Deed (if applicable). 

ARTICLE XII

ADJUSTMENTS

          12.1
Adjustments. Unless otherwise provided herein, at Closing, adjustments
between the parties shall be made as of 12:01 a.m. on the Closing Date (the “Cutoff Time”), with the income and
expenses accrued prior to the Closing Date being allocated to Seller and the
income and expenses accruing on and after the Closing Date being allocated to
Buyer, all as set forth below. All of such adjustments and allocations shall be
made in cash at Closing and shall be collected through and/or adjusted in accordance
with the terms of the Existing Management Agreement. Except as otherwise
expressly provided herein, all apportionments and adjustments shall be made on
an accrual basis in accordance with generally accepted accounting principles.
Buyer and Seller shall request that the Manager determine the apportionments,
allocations, prorations and adjustments as of the Cutoff Time. 

                    (a)
Taxes. All real estate taxes, personal property taxes, or any other
taxes and special assessments (special or otherwise) of any nature upon the
Property levied, assessed or pending for the calendar year in which the Closing
occurs (including the period prior to Closing, regardless of when due and
payable) shall be prorated as of the Cutoff Time and, if no tax bills or
assessment statements for such calendar year are available, such amounts shall
be estimated on the basis of the best available information for such taxes and
assessments that will be due and payable on the Hotel for the calendar year in
which Closing occurs. 

                    (b)
Utilities. All suppliers of utilities shall be instructed to read meters
or otherwise determine the charges owing as of the Closing Date for services
prior thereto, which charges shall be allocated to Seller. Charges accruing
after Closing shall be allocated to Buyer. If elected by Seller, Seller shall
be given credit, and Buyer shall be charged, for any utility deposits
transferred to and received by Buyer at Closing. 

                    (c)
Income/Charges. All rents, income and charges receivable or payable
under any Leases and Hotel Contracts applicable to the Property, and any
deposits, prepayments and receipts thereunder, shall be prorated between Buyer
and Seller as of the Cutoff Time. 

                    (d)
Accounts. All working capital accounts, reserve accounts and escrow
accounts (including all FF&E accounts, all PIP accounts, Manager escrows,
but excluding amounts held in tax and insurance escrow accounts and utility
deposits to the extent excluded from the definition of Deposits) shall become
the property of Buyer, without additional charge to Buyer and without Buyer
being required to fund the same. 

28

                    (e)
Guest Ledger. Subject to (f) below, all accounts receivable of
registered guests at the Hotel who have not checked out and were occupying
rooms as of the Cutoff Time, shall be prorated as provided herein. 

                    (f)
Room Rentals. All receipts from guest room rentals and other suite
revenues for the night in which the Cutoff Time occurs shall belong to Seller,
but Seller shall provide Buyer credit at Closing equal to the reasonable
expenses to be incurred by Buyer to clean such guests’ rooms. 

                    (g)
Advance Deposits. All prepaid rentals, room rental deposits, and all
other deposits for advance registration, banquets or future services to be
provided on and after the Closing Date shall be credited to Buyer. 

                    (h)
Accounts Receivable. To the extent not apportioned at Closing and
subject to (e) and (f) above, all accounts receivable and credit card claims as
of the Cutoff Time shall remain the property of Seller, and Seller and Buyer
agree that the monies received from debtors owing such accounts receivable
balances after Closing, unless otherwise provided in the Existing Management
Agreement, shall be applied as expressly provided in such remittance, or if not
specified then to the Seller’s outstanding invoices to such account debtors in
chronological order beginning with the oldest invoices, and thereafter, to
Buyer’s account. 

                    (i)
Accounts Payable. To the extent not apportioned at Closing, 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 Closing Date shall be retained by Seller and promptly allocated to Seller
and evidence thereof shall be provided to Buyer, and Buyer shall not be or
become liable therefor, except as expressly assumed by Buyer pursuant to this
Contract, and invoices received in the ordinary course of business prior to
Closing shall be allocated to Seller at Closing. 

                    (j)
Restaurants, Bars, Machines, Other Income. All monies received in
connection with bar, restaurant, banquet and similar and other services at the
Hotel (other than amounts due from any guest and included in room rentals)
prior to the close of business for each such operation for the night in which
the Cutoff Time occurs shall belong to Seller, and all other receipts and
revenues (not previously described in this Section 12.1) from the operation of
any department of the Hotel shall be prorated between Seller and Buyer at
Closing. 

          12.2
Reconciliation and Final Payment. Seller and Buyer shall reasonably
cooperate after Closing to make a final determination of the allocations and
prorations required under this Contract within ninety (90) days after the
Closing Date. Upon the final reconciliation of the allocations and prorations
under this Section, the party which owes the other party any sums hereunder
shall pay such party such sums within ten (10) days after the reconciliation of
such sums. The obligations to calculate such prorations, make such
reconciliations and pay any such sums shall survive the Closing. 

          12.3
Employees. None of the employees of the Hotel shall become employees of
Buyer, as of the Closing Date; instead, such employees shall remain employees
of the Manager. Seller shall not give notice under any applicable federal or
state plant closing or similar act, 

29

including, if
applicable, the Worker Adjustment and Retraining Notification Provisions of 29
U.S.C., Section 2102, the parties having agreed that a mass layoff, as that
term is defined in 29 U.S.C., 2101(a)(3), will not have occurred. Any liability
for payment of all wages, salaries and benefits, including, without limitation,
accrued vacation pay, sick leave, bonuses, pension benefits, COBRA rights, and
other benefits accrued or earned by and due to employees at the Hotel through
the Cutoff Time, together with F.I.C.A., unemployment and other taxes and
benefits due with respect to such employees for such period, shall be charged
to Seller, in accordance with the Existing Management Agreement, for the
purposes of the adjustments to be made as of the Cutoff Time. All liability for
wages, salaries and benefits of the employees accruing in respect of and
attributable to the period from and after Closing shall be charged to Buyer, in
accordance with the Existing Management Agreement. To the extent applicable,
all such allocations and charges shall be adjusted in accordance with the
provisions of the Existing Management Agreement. 

ARTICLE XIII

CASUALTY AND CONDEMNATION

          13.1
Risk of Loss; Notice. Prior to Closing and the delivery of possession of
the Property to Buyer in accordance with this Contract, all risk of loss to the
Property (whether by casualty, condemnation or otherwise) shall be borne by
Seller. In the event that (a) any loss or damage to the Hotel shall occur prior
to the Closing Date as a result of fire or other casualty, or (b) Seller
receives notice that a governmental authority has initiated or threatened to
initiate a condemnation proceeding affecting the Hotel, Seller shall give Buyer
immediate written notice of such loss, damage or condemnation proceeding (which
notice shall include a certification of (i) the amounts of insurance coverages
in effect with respect to the loss or damage and (ii) if known, the amount of
the award to be received in such condemnation). 

          13.2
Buyer’s Termination Right. If, prior to Closing and the delivery of
possession of the Property to Buyer in accordance with this Contract, (a) any
condemnation proceeding shall be pending against a substantial portion of the
Hotel or (b) there is any substantial casualty loss or damage to the Hotel,
Buyer shall have the option to terminate this Contract, provided Buyer delivers
written notice to Seller of its election within twenty (20) days after the date
Seller has delivered Buyer written notice of any such loss, damage or
condemnation as provided above, and in such event, the Earnest Money Deposit,
and any interest thereon, shall be delivered to Buyer and thereafter, except as
expressly set forth herein, no party shall have any further obligation or
liability to the other under this Contract. In the context of condemnation,
“substantial” shall mean condemnation of such portion of a Hotel (or access
thereto) as could, in Buyer’s reasonable judgment, render use of the remainder
impractical or unfeasible for the uses herein contemplated, and, in the context
of casualty loss or damage, “substantial” shall mean a loss or damage in excess
of One Hundred Thousand and No/100 Dollars ($100,000.00) in value. 

          13.3
Procedure for Closing. If Buyer shall not timely elect to terminate this
Contract under Section 13.2 above, or if the loss, damage or condemnation is
not substantial, each applicable Seller agrees to pay to Buyer at the Closing
all insurance proceeds or condemnation awards which Seller has received as a
result of the same, plus an amount equal to the insurance deductible, and
assign to Buyer all insurance proceeds and condemnation awards payable as a
result of the same, in which event the Closing shall occur without Seller replacing
or repairing 

30

such damage.
In the case of damage or casualty, at Buyer’s election, Seller shall repair and
restore the Property to its condition immediately prior to such damage or
casualty and shall assign to Buyer all excess insurance proceeds subject to
rights of any mortgagee holding a first priority security interest in the Real
Property. 

ARTICLE XIV

DEFAULT REMEDIES

          14.1
Buyer’s Default. SUBJECT TO ARTICLE XVII, IN THE EVENT THAT BUYER FAILS TO
COMPLETE THE PURCHASE OF THE PROPERTY FOR ANY REASON OTHER THAN (A) A DEFAULT
BY SELLER AFTER THE EXPIRATION OF A FIVE (5) DAY CURE PERIOD FOLLOWING WRITTEN
NOTICE FROM SELLER (PROVIDED NO NOTICE SHALL EXTEND THE TIME FOR CLOSING) (B)
THE EXISTENCE OF A PENDING DEFAULT, (C) THE FAILURE OF ANY CONDITION TO BUYER’S
OBLIGATION TO CLOSE THIS TRANSACTION WHICH IS EXPRESSLY SET FORTH HEREIN, OR
(D) THE TERMINATION OF THIS AGREEMENT BY BUYER PURSUANT TO A TERMINATION RIGHT
EXPRESSLY SET FORTH HEREIN OR OTHERWISE PROVIDED BY LAW, SELLER SHALL HAVE THE RIGHT
TO TERMINATE THIS AGREEMENT AND IN SUCH EVENT THE DEPOSIT, IF ANY HELD BY TITLE
COMPANY (TOGETHER WITH ALL INTEREST ACCRUED THEREON) SHALL BE DELIVERED TO
SELLER BY TITLE COMPANY UPON WRITTEN DEMAND AND THE DEPOSIT, IF ANY, RELEASED
TO SELLER SHALL BE RETAINED BY SELLER, AND SUCH DEPOSITS (TOGETHER WITH ALL
INTEREST ACCRUED THEREON) SHALL BE RETAINED BY SELLER AS LIQUIDATED DAMAGES
WITH RESPECT TO SUCH DEFAULT. THEREAFTER, BOTH PARTIES SHALL BE RELIEVED OF AND
RELEASED FROM ANY FURTHER LIABILITY HEREUNDER, EXCEPT FOR THE INDEMNIFICATION
OBLIGATIONS EXPRESSLY SET FORTH IN ANY SECTION OF THIS AGREEMENT, WHICH
OBLIGATIONS SHALL BE PERFORMABLE AND OWING IN ADDITION TO ANY SUMS RETAINED
HEREUNDER BY SELLER AS LIQUIDATED DAMAGES, AND EXCEPT THAT SELLER SHALL ALSO
HAVE THE RIGHT TO COLLECT FROM BUYER ALL COSTS AND EXPENSES (INCLUDING WITHOUT
LIMITATION, ATTORNEY FEES AND EXPENSES) INCURRED BY SELLER IN THE EVENT BUYER
DISPUTES SELLER’S RIGHT TO RECEIVE AND RETAIN THE FULL AMOUNT OF THE DEPOSIT
(TOGETHER WITH ALL INTEREST ACCRUED THEREON), WHICH SUMS SHALL BE PAYABLE BY
BUYER TO SELLER IN ADDITION TO ANY SUMS RETAINED HEREUNDER BY SELLER AS
LIQUIDATED DAMAGES. SELLER AND BUYER AGREE THAT IT WOULD BE EXTREMELY DIFFICULT
AND IMPRACTICABLE TO FIX ACTUAL DAMAGES TO SELLER AS A RESULT OF A DEFAULT BY
BUYER AND THAT THEY HAVE AGREED THE DEPOSIT IS A FAIR AND REASONABLE AMOUNT TO
BE RETAINED BY SELLER AS AGREED AND LIQUIDATED DAMAGES IN LIGHT OF SELLER’S
REMOVAL OF THE PROPERTY FROM THE MARKET AND THE COSTS INCURRED BY SELLER AND
THAT RETENTION OF THE DEPOSIT (TOGETHER WITH ALL INTEREST ACCRUED THEREON) BY
SELLER SHALL NOT CONSTITUTE A PENALTY OR FORFEITURE. WITHOUT LIMITING THE
FOREGOING, THIS SECTION 14.1 SHALL NOT PROHIBIT SELLER FROM BRINGING AN ACTION
AGAINST BUYER FOR BREACH OF ANY OF 

31

THE CONFIDENTIALITY OR NONDISCLOSURE PROVISIONS CONTAINED IN THIS AGREEMENT.

INITIALS:
___________/___________
[Initials of Buyer and Seller] 

          14.2
Seller’s Default. SUBJECT TO ARTICLE XVII, IF BUYER TENDERS PERFORMANCE OF
ALL OF ITS OBLIGATIONS IN ACCORDANCE WITH THIS AGREEMENT AND SELLER REFUSES OR
FAILS TO CONVEY THE PROPERTY AS HEREIN PROVIDED FOR ANY REASON OTHER THAN (A) A
DEFAULT BY BUYER AFTER THE EXPIRATION OF A FIVE (5) DAY CURE PERIOD FOLLOWING
WRITTEN NOTICE FROM BUYER, (B) THE EXISTENCE OF A PENDING DEFAULT, (C) THE
FAILURE OF A CONDITION TO SELLER’S OBLIGATION TO CLOSE THIS TRANSACTION WHICH
IS EXPRESSLY SET FORTH HEREIN, OR (D) ANY OTHER PROVISION OF THIS AGREEMENT
THAT EXPRESSLY PERMITS SELLER TO TERMINATE THIS AGREEMENT OR OTHERWISE RELIEVES
SELLER OF THE OBLIGATION TO CONVEY THE PROPERTY, BUYER SHALL ELECT AS ITS SOLE
REMEDY HEREUNDER EITHER TO TERMINATE THIS AGREEMENT AND RECOVER THE DEPOSIT, IN
WHICH CASE BUYER SHALL ALSO BE ENTITLED TO RECOVER ITS ACTUAL OUT-OF-POCKET
EXPENSES IN CONNECTION WITH THE PROPOSED ACQUISITION OF THE PROPERTY
(INCLUDING, WITHOUT LIMITATION, DUE DILIGENCE AND NEGOTIATIONS WITH SELLER AND
LENDERS, IF APPLICABLE), NOT TO EXCEED THE SUM OF ONE HUNDRED THOUSAND DOLLARS
($100,000), OR TO ENFORCE, SELLER’S OBLIGATIONS UNDER THIS AGREEMENT TO CONVEY
THE PROPERTY BY AN ACTION FOR SPECIFIC PERFORMANCE, PROVIDED THAT NO SUCH
ACTION IN SPECIFIC PERFORMANCE SHALL SEEK TO REQUIRE SELLER TO DO ANY OF THE
FOLLOWING: (A) CHANGE THE CONDITION OF THE PROPERTY OR RESTORE THE SAME AFTER
ANY FIRE OR OTHER CASUALTY; (B) EXPEND MONEY OR POST A BOND TO REMOVE A TITLE
ENCUMBRANCE OR DEFECT (OTHER THAN A SELLER’S MONETARY LIEN) OR CORRECT ANY
MATTER SHOWN ON A SURVEY OF THE PROPERTY; OR (C) SECURE ANY PERMIT, APPROVAL,
OR CONSENT WITH RESPECT TO THE PROPERTY OR SELLER’S CONVEYANCE OF THE PROPERTY.

INITIALS: ___________/___________
[Initials of Buyer and Seller] 

          14.3
Attorney’s Fees. Anything to the contrary herein notwithstanding, if it
shall be necessary for either the Buyer or Seller to employ an attorney to
enforce its rights pursuant to this Contract because of the default of the
other party, and the non-defaulting party is successful in enforcing such
rights, then the defaulting party shall reimburse the non-defaulting party for
the non-defaulting party’s reasonable attorneys’ fees, costs and expenses. 

ARTICLE XV

NOTICES

          All
notices required herein shall be deemed to have been validly given, as
applicable: (i) if given by telecopy, when the telecopy is transmitted to the
party’s telecopy number specified below and confirmation of complete receipt is
received by the transmitting party during normal 

32

business hours
or on the next Business Day if not confirmed during normal business hours, (ii)
if hand delivered to a party against receipted copy, when the copy of the
notice is receipted or rejected, (iii) if given by certified mail, return
receipt requested, postage prepaid, two (2) Business Days after it is posted
with the U.S. Postal Service at the address of the party specified below, (iv)
on the next delivery day after such notices are sent by recognized and
reputable commercial overnight delivery service marked for next day delivery,
return receipt requested or similarly acknowledged, or (v) if given by
electronic mail, when the electronic mail is sent to the address below: 

	
  

 	
  

 	
  

 
	
  

 	
 If to Buyer:

 	
 Apple Ten
 Hospitality Ownership, Inc. 

 814 E. Main Street 

 Richmond, Virginia 23219 

 Attention: Sam Reynolds 

 Fax No.: (804) 344-8129 

 E-mail: sreynolds@applereit.com 

 
	
  

 	
  

 	
  

 
	
  

 	
 with a copy
 to:

 	
 Apple Ten
 Hospitality Ownership, Inc. 

 814 E. Main Street 

 Richmond, Virginia 23219 

 Attention: Legal Dept. 

 Fax No.: (804) 344-8129 

 E-mail: dbuckley@applereit.com 

 
	
  

 	
  

 	
  

 
	
  

 	
 If to
 Seller:

 	
 OCEANSIDE
 SEAGATE SPE, LLC 

 c/o R D Olson Development 

 2955 Main Street, 3rd Floor 

 Irvine, CA 92614 

 Attention: Robert D. Olson 

 Fax No.: (949) 271-1080 

 E-mail: Bob.olson@rdodevelopment.com 

 
	
  

 	
  

 	
  

 
	
  

 	
 with a copy
 to:

 	
 Scott S.
 Pollard, Attorney at Law 

 4141 MacArthur Blvd., Suite 140 

 Newport Beach, CA 92660 

 Fax No.: (949) 261-6616 

 E-mail: ssplaw@pacbell.net 

 

          Addresses
may be changed by the parties hereto by written notice in accordance with this
Section. 

33

ARTICLE XVI

MISCELLANEOUS

          16.1
Performance. Time is of the essence in the performance and satisfaction
of each and every obligation and condition of this Contract. 

          16.2
Binding Effect; Assignment. This Contract shall be binding upon and
shall inure to the benefit of each of the parties hereto, their respective
successors and assigns. 

          16.3
Entire Agreement. This Contract and the Exhibits constitute the sole and
entire agreement between Buyer and Seller with respect to the subject matter
hereof. No modification of this Contract shall be binding unless signed by both
Buyer and Seller. 

          16.4
Governing Law. The validity, construction, interpretation and
performance of this Contract shall in all ways be governed and determined in
accordance with the laws of the State of California (without regard to
conflicts of law principles). 

          16.5
Captions. The captions used in this Contract have been inserted only for
purposes of convenience and the same shall not be construed or interpreted so
as to limit or define the intent or the scope of any part of this Contract. 

          16.6
Confidentiality. Except as either party may reasonably determine is
required by law (including without limitation laws and regulations applicable
to Buyer or its Affiliates who may be public companies) prior to Closing, Buyer
and Seller shall not disclose the existence of this Contract or their
respective intentions to purchase and sell the Property or generate or
participate in any publicity or press release regarding this transaction,
except to Buyer’s and Seller’s legal counsel and lender, Buyer’s consultants,
investors and agents, the Manager and the Title Company and except as
necessitated by Buyer’s Due Diligence Examination and/or shadow management,
unless both Buyer and Seller agree in writing and as necessary to effectuate
the transactions contemplated hereby. 

          16.7
Closing Documents. To the extent any Closing documents are not attached
hereto at the time of execution of this Contract, Buyer and Seller shall
negotiate in good faith with respect to the form and content of such Closing
documents prior to Closing. 

          16.8
Counterparts. This Contract may be executed in counterparts by the
parties hereto, and by facsimile signature, and each shall be considered an
original and all of which shall constitute one and the same agreement. 

          16.9
Severability. If any provision of this Contract shall, for any reason,
be adjudged by any court of competent jurisdiction to be invalid or
unenforceable, such judgment shall not affect, impair or invalidate the
remainder of this Contract but shall be confined in its operation to the
provision or provisions hereof directly involved in the controversy in which
such judgment shall have been rendered, and this Contract shall be construed as
if such provision had never existed, unless such construction would operate as
an undue hardship on Seller or Buyer or would constitute a substantial
deviation from the general intent of the parties as reflected in this Contract.

34

          16.10
Interpretation. For purposes of construing the provisions of this
Contract, the singular shall be deemed to include the plural and vice versa and
the use of any gender shall include the use of any other gender, as the context
may require. 

          16.11
(Intentionally Omitted) 

          16.12
Further Acts. In addition to the acts, deeds, instruments and agreements
recited herein and contemplated to be performed, executed and delivered by
Buyer and Seller, Buyer and Seller shall perform, execute and deliver or cause
to be performed, executed and delivered at the Closing or after the Closing,
any and all further acts, deeds, instruments and agreements and provide such
further assurances as the other party or the Title Company may reasonably
require to consummate the transaction contemplated hereunder. 

          16.13 Joint
and Several Obligations. If Seller consists of more than one person or
entity, each such person or entity shall be jointly and severally liable with
respect to the obligations of Seller under this Contract. 

[Signatures Begin on Following Page]

35

IN WITNESS
WHEREOF, this Contract has been executed, to be effective as of the date first
above written, by the Buyer and Seller. 

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 SELLER:

 
	
  

 	
 OCEANSIDE
 SEAGATE SPE, LLC,

 
	
  

 	
 a California
 limited liability company

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
 Oceanside
 Seagate Hotels, LLC,

 a California limited liability company, its manager

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 By: Olson
 Real Estate Group, Inc.,

 a California corporation, its manager

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 By:

 	
 /s/ Robert
 D. Olson

 
	
  

 	
  

 	
  

 	
  

 	

 

 
	
  

 	
  

 	
  

 	
 Name:

 	
 Robert D.
 Olson

 
	
  

 	
  

 	
  

 	
 Title:

 	
 President

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 By:

 	
 Joseph
 Martelli Real Estate Investments, Inc.,

 a California corporation, its manager

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 By;

 	
 /s/ Joseph
 M. Martelli

 
	
  

 	
  

 	
  

 	

 

 
	
  

 	
  

 	
 Name:

 	
 Joseph M.
 Martelli

 
	
  

 	
  

 	
 Title:

 	
 President

 

	
  

 	
  

 	
  

 
	
  

 	
 BUYER:

 
	
  

 	
  

 	
  

 
	
  

 	
 APPLE TEN
 HOSPITALITY OWNERSHIP, INC., a

 
	
  

 	
 Virginia
 corporation

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
 /s/ David
 Buckley

 
	
  

 	
  

 	

 

 
	
  

 	
 Name: David
 Buckley
Title: Vice
 President

 

36

EXHIBIT “A”

LEGAL DESCRIPTION OF LAND

 (ATTACHED HERETO)

REAL
PROPERTY IN THE CITY OF OCEANSIDE, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA,
DESCRIBED AS FOLLOWS: 

PARCEL
A: 

THAT
CERTAIN PARCEL OF LAND SITUATED IN THE CITY OF OCEANSIDE, COUNTY OF SAN DIEGO,
STATE OF CALIFORNIA, BEING PORTIONS OF PARCELS 11 AND 12 AS SHOWN ON PARCEL MAP
NO. 20077 FILED AUGUST 14, 2006, IN THE OFFICE OF THE COUNTY RECORDER OF SAID
SAN DIEGO COUNTY, DESCRIBED AS FOLLOWS: 

BEGINNING
AT THE WESTERLY TERMINUS OF THAT CERTAIN COURSE SHOWN AS “NORTH 88°30’00” EAST
493.95 FEET” ON THE NORTHERLY LINE OF SAID PARCEL 11; THENCE ALONG THE
NORTHERLY LINES OF SAID PARCELS 11 AND 12 NORTH 88°30’00” EAST 312.84 FEET;
THENCE SOUTH 01°30’00” EAST 270.00 FEET; THENCE NORTH 88°30’00” EAST 114.00
FEET; THENCE SOUTH 01°30’00” EAST 49.98 FEET TO A POINT ON THE SOUTHERLY LINE
OF SAID PARCEL 12, SAID POINT BEING ON A NON-TANGENT CURVE CONCAVE
NORTHWESTERLY AND HAVING A RADIUS OF 792.28 FEET, A RADIAL LINE OF SAID CURVE
FROM SAID POINT BEARS NORTH 15°31’49” WEST; THENCE ALONG SAID SOUTHERLY LINE
AND CURVE, AND THE SOUTHERLY AND WESTERLY LINES OF SAID PARCEL 11 THROUGH THE
FOLLOWING COURSES; WESTERLY 119.03 FEET THROUGH A CENTRAL ANGLE OF 08°36’28” TO
AN INTERSECTION WITH A NON-TANGENT CURVE CONCAVE NORTHERLY AND HAVING A RADIUS
OF 8076.47 FEET, A RADIAL LINE OF SAID CURVE FROM SAID INTERSECTION BEARS NORTH
04°15’22” WEST; THENCE ALONG SAID CURVE WESTERLY 23.14 FEET THROUGH A CENTRAL
ANGLE OF 00°09’51”; THENCE NON-TANGENT FROM SAID CURVE SOUTH 87°28’37” WEST
290.95 FEET TO A POINT ON A NON-TANGENT CURVE CONCAVE WESTERLY AND HAVING A
RADIUS OF 168.00 FEET, A RADIAL LINE OF SAID CURVE FROM SAID POINT BEARS NORTH
84°02’09” WEST” THENCE ALONG SAID CURVE NORTHERLY 23.48 FEET THROUGH A CENTRAL
ANGLE 08°00’27”; THENCE TANGENT FROM SAID CURVE NORTH 02°02’36” WEST 148.16
FEET TO THE BEGINNING OF A TANGENT CURVE CONCAVE WESTERLY AND HAVING A RADIUS
OF 1864.00 FEET; THENCE ALONG SAID CURVE NORTHERLY 146.37 FEET THROUGH A
CENTRAL ANGLE OF 04°29’57”; THENCE NON-TANGENT FROM SAID CURVE NORTH 11°22’12”
WEST 12.10 FEET; THENCE NORTH 37°37’40” EAST 21.52 FEET TO THE POINT OF
BEGINNING. 

THE
ABOVE LAND IS DESCRIBED AS PARCEL 2 ON THE CERTIFICATE OF COMPLIANCE RECORDED
MARCH 2, 2009 AS INSTRUMENT NO. 2009-0101919 OF OFFICIAL RECORDS. 

PARCEL
B: 

AN
EASEMENT AND RIGHT OF WAY FOR INGRESS AND EGRESS OVER THE FOLLOWING DESCRIBED
PROPERTY. 

2

ALL
THAT PORTION OF SECTION 21, TOWNSHIP 11 SOUTH, RANGE 4 WEST, SAN BERNARDINO
MERIDIAN IN THE CITY OF OCEANSIDE, COUNTY OF SAN DIEGO, STATE OF CALIFORNIA,
ACCORDING TO OFFICIAL PLAT THEREOF, MORE PARTICULARLY DESCRIBED AS FOLLOWS: 

COMMENCING
AT THE NORTHERLY TERMINUS OF THE EASTERLY LINE OF PARCEL 2, SHOWN AS NORTH 00°59’59”
EAST 2000.05 FEET ON MAP NO. 14168 RECORDED MARCH 15, 2001 AS INSTRUMENT
NO. 2001-0150424 IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY;
THENCE SOUTHERLY ALONG SAID EASTERLY LINE SOUTH 00°59’59” WEST 1999.95 FEET TO
THE NORTHEAST CORNER OF SAID SECTION 21; THENCE CONTINUING SOUTHERLY ALONG SAID
MAP NO. 14168 SOUTH 00°51’59” WEST 1309.84 FEET TO THE EASTERLY TERMINUS
OF THAT LINE SHOWN AS NORTH 88°58’00” WEST 5198.85 FEET ON SAID MAP NO. 14168;
THENCE WESTERLY ALONG SAID LINE NORTH 88°58’25” WEST 1733.48 FEET TO THE
INTERSECTION TO THE INTERSECTION OF THE NORTHEASTERLY PROLONGATION OF THAT
CERTAIN COURSE SHOWN ON NORTH 38°55’00” EAST 378.00 FEET IN GRANT DEED RECORDED
FEBRUARY 23, 2001 AS INSTRUMENT NO. 2001-0103813 OF OFFICIAL RECORDS, IN
THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY; THENCE SOUTHWESTERLY ALONG
SAID NORTHEASTERLY PROLONGATION AND SAID CERTAIN COURSE SHOWN AS NORTH
38°55’00” EAST 378.00 FEET IN SAID GRANT DEED, SOUTH 38°54’41” WEST 102.45 FEET
TO THE TRUE POINT OF BEGINNING; THENCE CONTINUING ALONG SAID GRANT DEED SOUTH
38°54’41” WEST 301.75 FEET; THENCE LEAVING SAID GRANT DEED NORTH 54°48’18” EAST
305.05 FEET TO THE WESTERLY SIDELINE OF CORPORATE CENTER AS SHOWN ON SAID MAP
NO. 14168, BEING A POINT ON A NON-TANGENT CURVE CONCAVE
WESTERLY, HAVING A RADIUS OF 958.00 FEET, A RADIAL LINE TO WHICH BEARS SOUTH
56°38’20” EAST; THENCE NORTHERLY ALONG SAID WESTERLY SIDELINE AND SAID
NON-TANGENT CURVE THROUGH A CENTRAL ANGLE OF 56°27’ AN ARC LENGTH OF 82.61
FEET; THENCE LEAVING SAID WESTERLY SIDELINE SOUTH 88°21’41” WEST 102.84 FEET TO
THE TRUE POINT OF BEGINNING. 

EXCEPTING
THEREFROM ANY PORTION THEREOF LYING WITHIN PARCEL A ABOVE. 

PARCEL
C: 

AN
EASEMENT AND RIGHT OF WAY FOR RECIPROCAL ACCESS AND PUBLIC UTILITIES AND
APPURTENANCES THERETO, OVER, UNDER, ALONG AND ACROSS THAT PORTION OF PARCEL MAP
20077, IN THE CITY OF OCEANSIDE, COUNTY OF SAN DIEGO, STATE OF
CALIFORNIA, FILED IN THE OFFICE OF THE COUNTY RECORDER, AUGUST 14, 2006 AS
INSTRUMENT NO. 2006-0577840 OF OFFICIAL RECORDS, DESIGNATED AND
DELINEATED AS “PROPOSED RECIPROCAL ACCESS EASEMENT” AND “PROPOSED PRIVATE
UTILITY EASEMENT”. 

EXCEPTING
THEREFROM THAT PORTION LYING WITHIN PARCELS A AND B. 

3

PARCEL
D: 

NON-EXCLUSIVE
PERPETUAL EASEMENTS FOR DRIVEWAYS, SURFACE DRAINAGE AND (“UTILITY EASEMENTS”)
FOR (I) DRAINAGE OF STORM WATER RUNOFF; (II) DRAINAGE OF SEWAGE THROUGH THE
PRIVATE SEWER LINES AND (III) INSTALLATION, REPAIR, REPLACEMENT USE AND
OPERATION OF THE PRIVATE UTILITY IMPROVEMENTS AS GRANTED IN DECLARATION OF
COVENANTS, CONDITIONS AND RESTRICTIONS FOR SEAGATE CORPORATE CENTER RECORDED
AUGUST 14, 2006 AS INSTRUMENT NO. 2006-0577842 OF OFFICIAL RECORDS. 

APN:
162-600-23 

4

EXHIBIT B

LIST OF FF&E

Per the list provided by Seller under Exhibit
C.

EXHIBIT C

DOCUMENT INVENTORY

PROPERTY NAME:
Oceanside Courtyard
Date Opened: TBD

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Due Diligence:

 	
  

 	
  

 	
  

 	
  

 	
  

 	
 Date

 Sent

 	
  

 	
 Comments

 
	

 

 	
  

 	
  

 	
  

 	
  

 	
  

 	

 

 	
  

 	

 

 
	
 Financial and Marketing Documents:

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2

 	
  

 	
 2011 Budget (Operating)

 	
  

 	
 N/A

 	
  

 	
 N/A

 	
  

 	
 N/A 

 
	
  

 	
  

 	
 2011 Budget (Capital
 Expenditures)

 	
  

 	
 N/A

 	
  

 	
 N/A

 	
  

 	
 N/A 

 
	
 3

 	
  

 	
 STAR Report

 	
  

 	
  

 	
  

 	
  

 	
  

 	
 Apple to use Oceanside RI
 STR

 
	
 4

 	
  

 	
 2011 Marketing Plan

 	
  

 	
 x

 	
  

 	
 10/19/11

 	
  

 	
  

 
	
 5

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 6

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Tax and Insurance Documents:

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7

 	
  

 	
 Real Estate Tax Bills

 	
  

 	
 x

 	
  

 	
 10/19/11

 	
  

 	
  

 
	
  

 	
  

 	
 Personal Property Tax
 Bills

 	
  

 	
 N/A

 	
  

 	
 N/A

 	
  

 	
 N/A

 
	
 8

 	
  

 	
 Notices of Current Tax
 Assessments or Increases

 	
  

 	
 N/A

 	
  

 	
 N/A

 	
  

 	
 N/A

 
	
 9

 	
  

 	
 Schedule of Insurance
 Coverage and Claims

 	
  

 	
 x

 	
  

 	
 10/21/11

 	
  

 	
  

 
	
 10

 	
  

 	
 Personal Property List
 (e.g., FF&E, office equipment)

 	
  

 	
 x

 	
  

 	
 10/25/11

 	
  

 	
  

 
	
 11

 	
  

 	
 Inventory of Supplies
 (e.g., chinaware, glassware, paper goods, office supplies, unopened food and
 beverage inventory)

 	
  

 	
 x

 	
  

 	
 10/19/11

 	
  

 	
  

 
	
 12

 	
  

 	
 Copies of Service
 Contracts and Equipment Leases

 	
  

 	
  

 	
  

 	
  

 	
  

 	
 RDOD to deliver by 11/4/11

 
	
 13

 	
  

 	
 Copies of Space Leases
 (e.g., gift shop, health club/spa)

 	
  

 	
 N/A

 	
  

 	
 N/A

 	
  

 	
 N/A 

 
	
 14

 	
  

 	
 Lease Files

 	
  

 	
 N/A

 	
  

 	
 N/A

 	
  

 	
 N/A 

 
	
 15

 	
  

 	
 Schedule of Security
 Deposits for Space Leases (if applicable)

 	
  

 	
 N/A

 	
  

 	
 N/A

 	
  

 	
 N/A 

 
	
 16

 	
  

 	
 Copies and Schedules of
 all Warranties and Guaranties

 	
  

 	
  

 	
  

 	
  

 	
  

 	
 RDOD to deliver by
 11/11/11

 

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Management Agreements, Permits and Licenses:

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 17

 	
  

 	
 Management Agreement
 (assignment or termination)

 	
  

 	
 x

 	
  

 	
 10/19/11

 	
  

 	
  

 
	
 18

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 19

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 20

 	
  

 	
 Most current Franchise
 Property Improvement Plan or QA Assessment, if any

 	
  

 	
  

 	
  

 	
  

 	
  

 	
 Marriott punch list
 anticipated 11/4/11

 
	
 21

 	
  

 	
 Copies of all Licenses,
 Permits, and Approvals, including Liquor License, if applicable

 	
  

 	
  

 	
  

 	
  

 	
  

 	
 Liquor license in process,
 Marriott to obtain by 11/4/11

 
	
 22

 	
  

 	
 Schedule of Employees

 	
  

 	
  

 	
  

 	
  

 	
  

 	
 Apple to request directly
 from Marriott corporate 

 
	
 23

 	
  

 	
 Most Recent Property
 Payroll

 	
  

 	
  

 	
  

 	
  

 	
  

 	
 Apple to request directly
 from Marriott corporate

 
	
 24

 	
  

 	
 Copy of Employment
 Contracts, if any

 	
  

 	
  

 	
  

 	
  

 	
  

 	
 Apple to request directly
 from Marriott corporate

 
	
 Facility Reports/Audits:

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 25

 	
  

 	
 Plans & Specs
 (electronically if available)

 	
  

 	
 x

 	
  

 	
 10/19/11

 	
  

 	
 Final design drawings
 provided, as-builts anticipated 11/4/11

 
	
 26

 	
  

 	
 Appraisal

 	
  

 	
 N/A

 	
  

 	
 N/A

 	
  

 	
 Bank appraisal does not
 apply 

 
	
 27

 	
  

 	
 Structural Engineering
 Audit

 	
  

 	
  

 	
  

 	
  

 	
  

 	
 Requested from architect,
 anticipated 11/4/11

 
	
 28

 	
  

 	
 Environment Audit (Phase
 I)

 	
  

 	
 x

 	
  

 	
 10/19/11

 	
  

 	
  

 
	
 29

 	
  

 	
 Property Condition Report

 	
  

 	
  

 	
  

 	
  

 	
  

 	
 Marriott punch list
 anticipated 11/4/11

 
	
 30

 	
  

 	
 Schedule of Utility
 Providers and Utility Deposits

 	
  

 	
 x

 	
  

 	
 10/25/11

 	
  

 	
  

 
	
 31

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 32

 	
  

 	
 Evidence of Zoning

 	
  

 	
 x

 	
  

 	
 10/19/11

 	
  

 	
  

 
	
 33

 	
  

 	
 Certificate of Occupancy

 	
  

 	
 x

 	
  

 	
 10/28/11

 	
  

 	
  

 
	
 Title and Survey Matters:

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 34

 	
  

 	
 Title Insurance
 Commitment, Title Search or Title Certificate

 	
  

 	
 x

 	
  

 	
 10/19/11

 	
  

 	
 Updated title report
 (10/11/11)

 
	
 35

 	
  

 	
 Copies of Title Exceptions

 	
  

 	
 x

 	
  

 	
 10/19/11

 	
  

 	
 Updated title report
 (10/11/11)

 
	
 36

 	
  

 	
 ALTA Survey

 	
  

 	
 x

 	
  

 	
 10/19/11

 (Survey of vacant land)

 	
  

 	
 Updated ALTA survey
 ordered, anticipated 11/4/11 

 

2

	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 New
 Management Company Information

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
 37

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Rental and Reservation
 Records (including advance reservations and bookings)

 	
  

 	
  

 	
  

 	
  

 	
  

 	
 Apple to request directly
 from Marriott corporate 

 
	
  

 	
  

 	
 Customer Lists

 	
  

 	
  

 	
  

 	
  

 	
  

 	
 Apple to request directly
 from Marriott corporate 

 
	
  

 	
  

 	
 Frequent Guest List

 	
  

 	
  

 	
  

 	
  

 	
  

 	
 Apple to request directly
 from Marriott corporate 

 

3

EXHIBIT D

LIST OF HOTEL CONTRACTS

EXHIBIT D-1 -
Seller’s Hotel Contracts

                              Expect
as otherwise provided by Seller in connection with the checklist set forth in
Exhibit C, there are none to Seller’s knowledge other than Manager arranged
contracts.

EXHIBIT D-2 -
Other Hotel Contracts

	
  

 	
  

 
	
  

 	
 Utilities:

 
	
  

 	
 SDG&E
 (gas and electric)

 
	
  

 	
 City of
 Oceanside (water and sewer)

 
	
  

 	
 AT&T
 (telephone)

 
	
  

 	
 COX
 (internet)

 
	
  

 	
 DirecTV
 (television)

 
	
  

 	
 ADT
 (security)

 

EXHIBIT E

CONSENTS AND APPROVALS

	
  

 	
  

 	
  

 
	
  

 	
 A. Consents
 Under Hotel Contracts: 

 
	
  

 	
  

 	
 a.
 Management Agreement (Marriott)

 
	
  

 	
  

 	
 b. OS&E
 Contract (Marriott)*

 
	
  

 	
  

 	
 c. Public
 Computer Systems (Uniguest)*

 
	
  

 	
  

 	
 d. POS
 System (Micros)*

 
	
  

 	
  

 	
 e. Security
 System (ADT)*

 
	
  

 	
  

 	
  

 
	
  

 	
 B. Consents
 Under Other Contracts: Other than any consent required pursuant to a recorded
 instrument, none to the knowledge of Seller.

 
	
  

 	
  

 	
  

 
	
  

 	
 B.
 Governmental Approvals and Consents: None to the knowledge of Seller

 

* indicates
Hotel Contract executed by Olson Real Estate Group, Inc.

EXHIBIT F

ENVIRONMENTAL REPORTS

Phase I
Environmental Site Assessment

AEI Consultants

August 26, 2010

Geotechnical
Review

Leighton and Associates

October 6, 2010

Supplemental
Geotechnical Recommendation

Leighton and Associates

October 7, 2010

EXHIBIT G

CLAIMS OR LITIGATION PENDING

None to
knowledge of Seller.

EXHIBIT H

ESCROW AGREEMENT

          THIS
ESCROW AGREEMENT (this “Agreement”)
made the ___ day of _______, 2011by and among OCEANSIDE SEAGATE SPE, LLC, a
California limited liability company (“Seller”),
APPLE TEN HOSPITALITY OWNERSHIP, INC. a Virginia corporation, or its assigns (“Buyer”), and CHICAGO TITLE COMPANY
(“Escrow Agent”). 

R E C I T A L S 

          WHEREAS,
pursuant to the provisions of Section 2.6 of that certain Purchase Contract
dated October 28, 2011 (the “Contract”) between Seller and Buyer (the “Parties”), the Parties have requested
Escrow Agent to hold in escrow in accordance with the provisions, upon the
terms, and subject to the conditions, of this Agreement, the Earnest Money
Deposit as defined in the Contract (the “Deposit”);
and 

          WHEREAS,
the Deposit shall be delivered to Escrow Agent in accordance with the terms of
the Contract and this Agreement. 

          NOW,
THEREFORE, in consideration of the mutual covenants and agreements herein
contained, the Parties hereto agree as follows: 

                    1.
Seller and Buyer hereby appoint Escrow Agent to serve as escrow agent
hereunder, and the Escrow Agent agrees to act as escrow agent hereunder in
accordance with the provisions, upon the terms and subject to the conditions of
this Agreement. The Escrow Agent hereby acknowledges receipt of the Deposit.
Escrow Agent shall invest the Deposit as directed by Buyer. 

                    2.
Subject to the rights and obligations to transfer, deliver or otherwise dispose
of the Deposit, Escrow Agent shall keep the Deposit in Escrow Agent’s
possession pursuant to this Agreement. 

                    3.
A. Buyer shall be entitled to an immediate return of the Deposit at any time
prior to the expiration of the Review Period (as defined in Section 3.1 of the
Contract) by providing written notice to Escrow Agent stating that Buyer has
elected to terminate the Contract pursuant to Section 3.1. 

                         B.
If at any time after the expiration of the Review Period, Buyer claims entitlement
to all or any portion of the Deposit, Buyer shall give written notice to Escrow
Agent stating that Seller has defaulted in the performance of its obligations
under the Contract beyond the applicable grace period, if any, or that Buyer is
otherwise entitled to the return of the Deposit or applicable portion thereof
and shall direct Escrow Agent to return the Deposit or applicable portion
thereof to Buyer (the “Buyer’s Notice”).
Escrow Agent shall promptly deliver a copy of Buyer’s Notice to Seller. Seller
shall have three (3) business days after receipt 

of the copy of
Buyer’s Notice to deliver written notice to Escrow Agent and Buyer objecting to
the release of the Deposit or applicable portion thereof to Buyer (“Seller’s Objection Notice”). If Escrow
Agent does not receive a timely Seller’s Objection Notice, Escrow Agent shall
release the Deposit or applicable portion thereof to Buyer. If Escrow Agent
does receive a timely Seller’s Objection Notice, Escrow Agent shall release the
Deposit or applicable portion thereof only upon receipt of, and in accordance
with, written instructions signed by Seller and Buyer, or the final order of a
court of competent jurisdiction. 

                              C.
If, at any time after the expiration of the Review Period, Seller claims
entitlement to the Deposit or applicable portion thereof, Seller shall give
written notice to Escrow Agent stating that Buyer has defaulted in the
performance of its obligations under the Contract, and shall direct Escrow
Agent to release the Deposit or applicable portion thereof to Seller (the “Seller’s Notice”). Escrow Agent shall
promptly deliver a copy of Seller’s Notice to Buyer. Buyer shall have three (3)
business days after receipt of the copy of Seller’s Notice to deliver written
notice to Escrow Agent and Seller objecting to the release of the Deposit or
applicable portion thereof to Seller (“Buyer’s
Objection Notice”). If Escrow Agent does not receive a timely
Buyer’s Objection Notice, Escrow Agent shall release the Deposit or applicable
portion thereof to Seller. If Escrow Agent does receive a timely Seller’s
Objection Notice, Escrow Agent shall release the Deposit or applicable portion
thereof only upon receipt of, and in accordance with, written instructions
signed by Buyer and Seller, or the final order of a court of competent
jurisdiction. 

                    4.
In the performance of its duties hereunder, Escrow Agent shall be entitled to
rely upon any document, instrument or signature purporting to be genuine and
purporting to be signed by and of the Parties or their successors unless Escrow
Agent has actual knowledge to the contrary. Escrow Agent may assume that any
person purporting to give any notice or instructions in accordance with the
provisions hereof has been duly authorized to do so. 

                    5.
A. Escrow Agent shall not be liable for any error of judgment, or any action
taken or omitted to be taken hereunder, except in the case of Escrow Agent’s
willful, bad faith misconduct or negligence, nor shall Escrow Agent be liable
for the conduct or misconduct of any employee, agent or attorney thereof.
Escrow Agent shall be entitled to consult with counsel of its choosing and
shall not be liable for any action suffered or omitted in accordance with the advice
of such counsel. 

                              B.
In addition to the indemnities provided below, Escrow Agent shall not be liable
for, and each of the Parties jointly and severally hereby indemnify and agree
to save harmless and reimburse Escrow Agent from and against all loss, cost,
liability, damage and expense, including outside counsel fees in connection
with its acceptance of, or the performance of its duties and obligations under,
this Agreement, including the costs and expenses of defending against any claim
arising hereunder unless the same are caused by the willful, bad faith
misconduct or negligence of Escrow Agent. 

                              C.
Escrow Agent shall not be bound or in any way affected by any notice of any
modification or cancellation of this Agreement, or of any fact or circumstance
affecting or alleged to affect rights or liabilities hereunder other than as is
herein set forth, or affecting or alleged to affect the rights and liabilities
of any other person, unless notice of the 

-ii-

same is
delivered to Escrow Agent in writing, signed by the proper parties to Escrow
Agent’s satisfaction and, in the case of modification, unless such modification
shall be approved by Escrow Agent in writing. 

                    6.
A. Escrow Agent and any successor escrow agent, as the case may be, may resign
his or its duties and be discharged from all obligations hereunder at any time
upon giving five (5) days’ prior written notice to each of the Parties hereto.
The Parties hereto will thereupon jointly designate a successor escrow agent
hereunder within said five (5) day period to whom the Deposit shall be
delivered. In default of such a joint designation of a successor escrow agent,
Escrow Agent shall retain the Deposit as custodian thereof until otherwise
directed by the Parties hereto, jointly, or until the Deposit is released in
accordance with clause (B) below, in each case, without liability or
responsibility. 

                              B.
Anything in this Agreement to the contrary notwithstanding, (i) Escrow Agent,
on notice to the Parties hereto, may take such other steps as the Escrow Agent
may elect in order to terminate its duties as Escrow Agent hereunder,
including, but not limited to, the deposit of the Deposit with a court of
competent jurisdiction in the State of California and the commencement of an
action of interpleaders, and (ii) in the event of litigation between any of the
Parties with respect to the Deposit, Escrow Agent may deposit the Deposit with
the court in which said litigation is pending and, in any such event, Escrow
Agent shall be relieved and discharged from any liability or responsibility to
the Parties hereto. Escrow Agent shall not be under any obligation to take any
legal action in connection with this Agreement or its enforcement or to appear
in, prosecute or defend any action or legal proceeding which, in the opinion of
Escrow Agent, would or might involve Escrow Agent in any cost, expense, loss,
damage or liability, unless and as often as requested, Escrow Agent shall be
furnished with security and indemnity satisfactory to Escrow Agent against all
such costs, expenses (including attorney’s fees), losses, damages and
liabilities. 

                    7.
All notices required herein shall be deemed to have been validly given, as
applicable: (i) if given by telecopy, when the telecopy is transmitted to the
party’s telecopy number specified below and confirmation of complete receipt is
received by the transmitting party during normal business hours or on the next
business day if not confirmed during normal business hours, (ii) if hand
delivered to a party against receipted copy, when the copy of the notice is
receipted or rejected, (iii) if given by certified mail, return receipt
requested, postage prepaid, two (2) business days after it is posted with the
U.S. Postal Service at the address of the party specified below or (iv) on the
next delivery day after such notices are sent by recognized and reputable
commercial overnight delivery service marked for next day delivery, return
receipt requested or similarly acknowledged: 

-iii-

	
  

 	
  

 	
  

 
	
  

 	
 (i)

 	
 If addressed
 to Seller, to:

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 OCEANSIDE
 SEAGATE SPE, LLC

 c/o R D Olson Development

 2955 Main Street, 3rd Floor 

 Irvine, CA 92614

 Attention: Robert D. Olson

 Fax No.: (949) 271-1080

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 with a copy
 to:

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Scott S.
 Pollard, Attorney at Law

 4141 MacArthur Blvd., Suite 140

 Newport Beach, CA 92660

 Fax No.: (949) 261-6616

 
	
  

 	
  

 	
  

 
	
  

 	
 (ii)

 	
 If addressed
 to Buyer, to:

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Apple Ten
 Hospitality Ownership, Inc.

 814 E. Main Street

 Richmond, Virginia 23219

 Attn: Sam Reynolds

 Fax No.: (804) 344-8129

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 with a copy
 to:

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Apple Eight
 Hospitality Ownership, Inc.

 814 E. Main Street

 Richmond, Virginia 23219

 Attn: Legal Dept.

 Fax No.: (804) 727-6349

 
	
  

 	
  

 	
  

 
	
  

 	
 (iii)

 	
 If addressed
 to Escrow Agent, to:

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Chicago
 Title Company

 5501 LBJ Freeway, Suite 200

 Dallas, Texas 75240

 Attn: Debby Moore

 Fax No.: (214) 987-6780

 

or such other
address or addresses as may be expressly designated by any party by notice
given in accordance with the foregoing provisions and actually received by the
party to whom addressed. 

-iv-

                    8.
This Agreement may be executed in any number of counterparts each of which
shall be deemed an original and all of which, together, shall constitute one
and the same Agreement. 

                    9.
The covenants, conditions and agreements contained in this Agreement shall bind
and inure to the benefit of each of the Parties hereto and their respective
successors and assigns. 

-v-

          IN
WITNESS WHEREOF the Parties have executed this Agreement as of the day and year
first above written.

	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 SELLER: 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 OCEANSIDE
 SEAGATE SPE, LLC,

 
	
  

 	
 a California
 limited liability company

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
 Oceanside
 Seagate Hotels, LLC, 

 a California limited liability company, its manager

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 By: Olson
 Real Estate Group, Inc., 

 a California corporation, its manager

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 By:

 	
  

 
	
  

 	
  

 	
  

 	
  

 	

 

 
	
  

 	
  

 	
  

 	
 Name:

 	
 Robert D.
 Olson

 
	
  

 	
  

 	
  

 	
 Title:

 	
 President

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 By:

 	
 Joseph
 Martelli Real Estate Investments, Inc., 

 a California corporation, its manager

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
 By;

 	
  

 
	
  

 	
  

 	
  

 	
  

 	

 

 
	
  

 	
  

 	
  

 	
 Name: 

 	
 Joseph M.
 Martelli

 
	
  

 	
  

 	
  

 	
 Title:

 	
 President

 

-vi-

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 BUYER:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 APPLE TEN
 HOSPITALITY OWNERSHIP, INC.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	

  

 
	
  

 	
  

 	
 

 
	
  

 	
 Name:

 	
  

 
	
  

 	
  

 	

 

 
	
  

 	
 Title:

 	

  

 
	
  

 	
  

 	
  

 	
 

 
	
  

 
	
  

 	
 ESCROW AGENT:

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 CHICAGO
 TITLE COMPANY

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 By:

 	
  

 
	
  

 	
  

 	

 

 
	
  

 	
 Name:

 	
  

 
	
  

 	
  

 	

 

 
	
  

 	
 Title:

 	

  

 
	
  

 	
  

 	

 

 

-vii-

SCHEDULE 2.4

Allocation

Total Real Property $22,298,440 (Land Portion
is $5,900,000)

Personal and Intangible Property $8,201,560

Total Purchase Price $30,500,000

-viii-

EXHIBIT I

CONSTRUCTION WARRANTY

          The
Contractor hereby warrants to Seller and Buyer that all materials and equipment
furnished with respect to the Property are new and the work performed by the
Contractor with respect to the Property is of good and workmanlike quality,
free from faults and defects, and in conformance with all contract documents.
Work not conforming to these requirements, including substitutions not properly
approved and authorized, may be considered defective. The foregoing warranty
excludes remedy for damage or defect caused by abuse, modifications not
executed by the Contractor, improper or insufficient maintenance, improper
operation, or normal wear and tear and normal usage. If required by Seller or
Buyer, the Contractor shall furnish satisfactory evidence as to the kind and quality
of materials and equipment. 

          The
Contractor hereby guarantees to Seller and Buyer all work performed and
materials and equipment furnished with respect to the Property against defects
in materials and workmanship for a period of one year from the date of
substantial completion of the entire Property, or for a longer period if so
specified in the contract documents. 

          The
Contractor shall, within a reasonable time after receipt of written notice
thereof, and without reimbursement under the construction contract, make good
any defects in materials, equipment and workmanship which may develop within
periods for which said material, equipment and workmanship are guaranteed and
make good any damage to other work caused by the repairing of such defects. 

-ix-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00196-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00196-of-00352.parquet"}]]