Document:

Exhibit 10.7

                                                                  [Pennsylvania]

                                 COMFORT LETTER

                                                     May 8, 2000

Apple Suites, Inc., as trustee for Apple
    Suites Pennsylvania Business Trust
306 East Main Street
Richmond, Virginia 23219

Attention:        Mr. Glade M. Knight

                           Re:      Homewood  Suites(R) hotel located at 12 East
                                    Swedesford Road, Malvern,  Pennsylvania (the
                                    "Hotel")
                                    --------------------------------------------

Gentlemen:

                  Promus  Hotels,  Inc.  ("Promus")  is  about to  execute  with
respect  to the Hotel (i) a License  Agreement  and the  Rider,  Attachment  and
Exhibits  referenced therein (the "License  Agreement"),  dated the date hereof,
pertaining  to the  licensing  of Apple  Suites  Management,  Inc.,  a  Virginia
corporation ("Lessee"),  to operate the Hotel as a Homewood Suites(R) hotel, and
(ii) a management  agreement of even date herewith (the "Management  Agreement")
with respect to the operation of the Hotel by Promus,  as Manager.  In addition,
Promus has loaned to Apple Suites,  Inc.  ("Parent") the sum of $80,186,250 (the
"Acquisition  Loan") as purchase money  financing for the acquisition of certain
properties (the  "Properties")  conveyed pursuant to the Purchase  Agreement (as
defined in the  Management  Agreement),  that  certain  Agreement  of Sale dated
August 6, 1999 by and among Hampton Inns, Inc., Promus Hotels Florida,  Inc. and
Promus, as sellers, and Parent, as buyer, as the same has been amended, and that
certain  Agreement of Sale dated October 5, 1999 between Hampton Inns,  Inc., as
seller,  and Parent,  as buyer, as the same has been amended,  which Acquisition
Loan is evidenced by (i) a note of Parent dated September 20, 1999 in the amount
of  $26,625,000,  (ii) a note of Parent  dated  October 5, 1999 in the amount of
$7,350,000,  (iii) a note of Parent  dated  November  29,  1999 in the amount of
$30,210,000,  (iv) a note of Parent  dated  December  22,  1999 in the amount of
$4,384,500  and (v) a note of  Parent  of even date  herewith  in the  amount of
$11,616,750 and is secured by, among other things, mortgage(s), deed(s) of trust
or deed(s) to secure debt dated  September 20, 1999,  October 5, 1999,  November
29,  1999,  December  22,  1999 or of even  date  herewith  from

<PAGE>

Parent  or  its  wholly-owned  subsidiary  which  encumbers  some  or all of the
Properties,  which may include the Hotel (the documents  evidencing and securing
the  Acquisition   Loan  herein  referred  to  as  the   "Acquisition   Mortgage
Documents").  Lessee is the owner of a subleasehold estate in the Hotel pursuant
to a Hotel Lease Agreement  dated on or about the date hereof (as  supplemented,
amended and  modified,  the  "Percentage  Lease") with Apple  Suites,  Inc.,  as
trustee for Apple Suites Pennsylvania Business Trust ("Fee Owner"). Although the
License  Agreement  is  non-assignable,  and is not  subject  to any  collateral
assignment,  Lessee and Fee Owner have  requested  that  Promus  enter into this
letter agreement with Fee Owner with respect to, among other things, Fee Owner's
rights with regard to the License  Agreement,  and Promus has requested that Fee
Owner enter into this letter  agreement with Promus with respect to, among other
things, the Management  Agreement and its continuing rights to operate the Hotel
for the term of the  Management  Agreement,  subject  to the terms  thereof  and
hereof,  and to confirm certain  understandings  with respect to the Acquisition
Loan.  No third  party  beneficiaries  (other  than Fee Owner) are  intended  or
implied. Fee Owner has requested that Promus inform you of the procedures Promus
agrees to follow in the event Lessee  commits a breach under the  provisions  of
the License  Agreement.  Promus,  Fee Owner and Lessee  acknowledge that (i) Fee
Owner's interest in the Hotel is a leasehold interest and (ii) Lessee's interest
therein is a  subleasehold  interest  and agree that  references  in this letter
agreement  to  the  parties'   interests  in  the  Hotel  shall  be  interpreted
accordingly.  Fee Owner  agrees to maintain  the lease or other  agreement  (the
"Ground Lease") through which its interest in the Hotel is derived in full force
and effect and to pay and discharge  any ground rents or other  payments due and
payable under the Ground Lease as and when the same become due and payable.

                  So  long as Fee  Owner  is the  owner  of the  Hotel,  and the
License  Agreement is in effect,  Promus will notify Fee Owner by certified mail
at the above  address  (or such other  address  as you may  specify in a written
notice to Promus  pursuant  hereto) of any  default as a result of any breach of
the License Agreement or Management Agreement by Lessee, provided, however, that
to the extent the default is a default under,  or termination of, the Percentage
Lease or a default under the Acquisition  Loan,  Promus shall have no obligation
to notify Fee Owner as contemplated  above. This notice will be in the form of a
copy of the notice of such default that is sent to Lessee. In the notice, Promus
will  give Fee  Owner  (i) ten (10)  days to cure or cause to be cured  monetary
defaults identified in Promus's default notice and (ii) thirty (30) days to cure
or cause to be cured the non-monetary  breach(es) identified in Promus's default
notice, provided, however, that to the extent the default identified in Promus's
default notice is not capable of being cured by Fee Owner (i.e.,  the bankruptcy
of Lessee or a transfer in violation of the License  Agreement),  Fee Owner will
not be afforded an  opportunity  to cure such  incurable  defaults.  If a breach
identified  in the  notice  is of a  curable  non-monetary  nature  which is not
reasonably  capable of being cured  within  such thirty (30) day period,  Promus
shall  extend  the cure  period  for such  length  of time as Promus in its sole
discretion  reasonably  determines is necessary for such breach to be cured (not
to exceed in any event an additional period of ninety (90) days).

                  In the  event a default  occurs  under  the  Percentage  Lease
(other than a default under the Acquisition Loan) and, as a consequence thereof,
Fee Owner  elects to

                                       2
<PAGE>

terminate the Percentage  Lease,  or remove Lessee from  possession of the Hotel
without  terminating the Percentage  Lease or if Lessee does not elect to extend
the  Percentage  Lease term through the full term of the License  Agreement (any
such event being  referred to herein as a "Triggering  Event") while the License
Agreement  and/or the Management  Agreement are in effect,  Fee Owner shall give
Promus written notice of such termination ("Triggering Event Notice"). Fee Owner
shall have a ninety (90) day period from the date such  Triggering  Event Notice
is given to elect to enter into a lease  agreement  with a substitute  lessee of
the Hotel satisfying the conditions set forth in Paragraph 1 below (a "Successor
Lessee")  and to obtain a new  license  agreement  for such Hotel in the name of
such Successor  Lessee,  for a term equal to the balance of the original term of
the License Agreement and otherwise on the terms and conditions set forth in the
License  Agreement,  except that it shall be issued to Successor  Lessee without
the payment of any  application  fee or transfer fee.  Promus's  obligations  to
issue a new  license  agreement  pursuant to this  paragraph  are subject to and
conditioned upon the satisfaction of the following:

                  1. Successor Lessee shall (i) be a "Permitted  Transferee" (as
hereinafter  defined)  and (ii) either (y) be (1) at least fifty  percent  (50%)
owned by Parent or persons that are its  "Affiliates"  (as hereinafter  defined)
and (2)  controlled  by Parent or its  Affiliates  or (z) have complied with the
requirements of Section 11 of the applicable License Agreement.

                  For  purposes of this letter  agreement  the  following  terms
shall have the respective meanings assigned thereto:

                  (a) The term "Permitted  Transferee"  means a person or entity
         that (i) has  adequate  financial  resources to perform all of Lessee's
         obligations  under  and in  accordance  with the  terms of the  License
         Agreement, the Percentage Lease, and/or the Management Agreement,  (ii)
         is not the  franchisor  or an  operator of a chain of hotels  (i.e.,  a
         group of hotels marketed under the same brand name) which competes with
         the Homewood  Suites(R)system  of hotels,  and (iii) enjoys a favorable
         reputation  for integrity in his or its community;  provided,  however,
         that an entity  the stock of which is not  traded on a  national  stock
         exchange shall not qualify as a "Permitted  Transferee"  unless (A) all
         officers,  directors,  managing  members and  general  partners of such
         entity and all persons  having,  directly or indirectly,  a ten percent
         (10%) or more equity or  profit-sharing  interest in such entity  would
         qualify as Permitted  Transferees  under clauses (ii) and (iii) of this
         sentence, and (B) all officers, directors, managing members and general
         partners of any entity having,  directly or  indirectly,  a ten percent
         (10%) or more equity or  profit-sharing  interest in such  entity,  the
         stock  of which is not  traded  on a  national  stock  exchange,  would
         qualify as Permitted  Transferees  under clauses (ii) and (iii) of this
         sentence.  For purposes of the foregoing,  it is agreed that any person
         or entity who or which, because of reputation or past conduct, has been
         denied  or would  be  likely  to be  denied  a  gaming  license  by any
         governmental authority shall not qualify as a "Permitted Transferee".

                  (b) The term "Affiliate"  means, with respect to any person or
         entity,  any other  person or entity  which,  directly  or  indirectly,
         controls, is controlled by, or is under common control with, such first
         person  or  entity.  For the  purposes  of

                                       3
<PAGE>

         this definition,  "control" (including,  with correlative meanings, the
         terms "controlled by" and "under common control with"),  shall mean the
         possession,  directly or indirectly, of the power (i) to vote more than
         fifty percent (50%) of the securities  having ordinary voting power for
         the election of directors of the controlled  person,  or (ii) to direct
         or cause the direction of the management and policies of the controlled
         person,  whether  through the ownership of voting shares or by contract
         or  otherwise,  and  shall be  deemed  to  include  the  directors  and
         executive officers of Parent.

                  2.  Successor  Lessee  shall  also  enter  into  a  management
agreement with Promus  covering the Hotel for a term equal to the balance of the
original term of the  Management  Agreement  covering the Hotel and otherwise on
the terms and conditions set forth in such Management Agreement.

                  If Fee Owner  fails to  provide a written  notice to Promus of
Successor Lessee's intention to obtain a new license within such ninety (90) day
period, the License Agreement shall, at Promus's option, terminate upon the date
of expiration of such ninety (90) day period, in which event Fee Owner shall pay
to Promus an amount, as liquidated  damages,  equal to the aggregate amount owed
under the License Agreement  (including  liquidated damages attributable to such
termination  as  provided in  Paragraph  13 of the  License  Agreement)  and the
Management Agreement.

                  If Fee Owner  enters into a new lease with a Successor  Lessee
who intends to obtain a new  license,  all existing  breaches  under the License
Agreement and the Management Agreement (collectively, the "Hotel Agreements") of
which Promus  notifies Fee Owner must be cured on or before the final day of the
ninety (90) day period,  provided,  however,  if such breach(es) are of the type
set forth in paragraph 13.d.(3) and (4) of the License Agreement or Section 9.01
of the Management Agreement and are not capable of being cured by Fee Owner or a
Successor Lessee within such ninety (90) day period, such breach(es) need not be
cured if Fee Owner or a Successor  Lessee cures all other  breaches of the Hotel
Agreements.  With regard to any breaches of a non-monetary  nature which are not
reasonably  capable of being cured  within  said ninety (90) day period,  Promus
shall  extend  the cure  period  for such  period  of time as Promus in its sole
discretion reasonably determines is necessary for such breaches to be cured.

                  In the event Fee Owner exercises its rights under the terms of
this  letter  agreement  to enable a  Successor  Lessee to obtain a new  license
agreement,  Lessee  shall  not  be  released  from  its  obligations  under  the
applicable  Hotel  Agreements  accruing prior to the date such Successor  Lessee
obtains a new license and enters into a new management agreement with Promus.

                  In addition,  in the event the provisions of Internal  Revenue
Code,  as amended,  applicable  to real estate  investment  trusts  ("REIT") are
amended to permit REITs,  such as Parent,  to operate hotels or otherwise render
the structure  embodied by the Percentage  Lease to be obsolete as  economically
unnecessary,  Fee Owner may give Promus  written  notice thereof (the "Tax Event
Notice") and of Fee Owner's  election to terminate the  Percentage  Lease and of
its desire to obtain a new license  agreement  for the Hotel in Fee Owner's name
for a term equal to the balance of the  original  term of the

                                       4
<PAGE>

License  Agreement  and otherwise on the terms and  conditions  set forth in the
License  Agreement,  except  that it shall be issued to Fee  Owner  without  the
payment of any  application  fee or transfer fee. The Tax Event Notice shall, in
addition,  contain  Lessee's  consent  to  the  termination  of  the  Management
Agreement and the License Agreement and  acknowledgment of the provisions of the
immediately  succeeding  paragraph.  Promus's obligations to issue a new license
agreement  pursuant to this  paragraph are subject to and  conditioned  upon the
satisfaction of the following:

                  1. Fee Owner shall be a  "Permitted  Transferee",  except that
clause  (i)  thereof  shall  be  amended  to read  "(i) has  adequate  financial
resources to perform all of owner's obligations under and in accordance with the
terms of the License Agreement and/or the Management Agreement".

                  2. Fee Owner shall also enter into a management agreement with
Promus  covering the Hotel for a term equal to the balance of the original  term
of the  Management  Agreement  covering the Hotel and otherwise on the terms and
conditions set forth in the Management Agreement.

                  In the event Fee Owner  exercises its right under the terms of
the  immediately  preceding  paragraph of this letter  agreement to enable it to
obtain  a  new  license  agreement,  Lessee  shall  not  be  released  from  its
obligations under the applicable Hotel Agreements accruing prior to the date Fee
Owner  obtains a new  license and enters into a new  management  agreement  with
Promus.

                  In  connection  with  Lessee's  execution  and delivery of the
License Agreement, Apple Suites, Inc. has executed and delivered for the benefit
of Promus  that  certain  Guaranty  of even date  herewith  with  respect to the
License Agreement (the "Guaranty").  Promus  acknowledges  that, in the event of
actual conflict, the terms and provisions of this letter agreement shall control
over the terms and provisions of the Guaranty.  Without  limiting the generality
of the  foregoing,  and in order to provide  Apple  Suites,  Inc.  with the full
benefits  intended by the  provisions  of the  immediately  preceding  sentence,
Promus shall notify Apple Suites,  Inc. by certified mail not less than ten (10)
days prior to Promus's  execution and delivery of any amendment or  modification
of the License  Agreement or of its  acceptance  of any  voluntary  surrender or
termination  by  Lessee of the  License  Agreement,  other  than  amendments  or
modifications or surrender or termination  which has been requested by Fee Owner
or Apple Suites, Inc. or to which Fee Owner is a party. Nothing in the foregoing
sentence  shall be deemed or construed to limit or restrict  Promus's  rights to
terminate or exercise any other remedy under the License  Agreement in the event
of a default by Lessee thereunder,  subject to the other terms and provisions of
this letter agreement.

                  With  reference  to  Licensee's  representation  in  the  last
sentence of Section 1(a) of the License Agreement,  Promus acknowledges that the
Percentage Lease is for a base term of less than twenty (20) years and that only
upon exercising all extension options  available to Licensee,  including certain
options  requiring  negotiation  of fair  market  rental,  will  the term of the
Percentage Lease extend to the full twenty (20) years of the term of the License
Agreement.  Fee Owner and Lessee  acknowledge that the failure for any reason to
exercise the extension  options will result in the application of the

                                       5
<PAGE>

liquidated  damages  provisions of Paragraph  13.f of the License  Agreement if,
upon the termination of the Percentage  Lease,  Fee Owner or a Successor  Lessee
does not obtain a new  license  agreement  for the Hotel for a term equal to the
balance of the original term of the License Agreement, as contemplated herein.

                  Promus hereby confirms for the benefit of Fee Owner and Lessee
that the License Agreement shall be read with the following clarifications:

                  (i) with respect to the  provisions  of Paragraph  1.d. of the
         License  Agreement  relating  to  the  requirement  to  use  particular
         Supplies  or that  particular  Supplies be  purchased  from Promus or a
         source designated by Promus, such requirements shall only be imposed on
         the  licensee  under the  License  Agreement  to the  extent  Promus is
         imposing such requirements on substantially all of its licensees of the
         System,  but that with respect to other  Supplies if Lessee  determines
         that it can purchase Supplies of a quality at least equal to that which
         Promus is requiring at a price lower than the price then being  charged
         by Promus or its designated supplier, Lessee may purchase such Supplies
         from its vendor;

                  (ii) with respect to the  provisions of Paragraph  6.a.(19) of
         the License  Agreement,  such  provisions  are not intended to preclude
         Lessee or any member of an affiliated group from owning licensed hotels
         of  other,  even  competing,  brands,  but from  owning a hotel  brand,
         tradename, system or chain;

                  (iii) with  respect to the  provisions  of Paragraph 11 of the
         License Agreement  relating to change in ownership or a transfer of the
         hotel, the provisions are intended to apply only to Lessee's beneficial
         or equity interests or its interest in the hotel; and

                  (iv) with  respect to the  language of the second  sentence of
         Paragraph 13.f. of the License  Agreement reading "If this Agreement is
         terminated  other  than by the  expiration  of the  term  described  in
         Paragraph  13.a.,",  this  language  is not  intended  to modify  other
         provisions  of  the  License  Agreement  relating  to  whether  or  not
         liquidated   damages  are  payable   under  other   circumstances   and
         accordingly  shall be read as if preceded by the phrase "Subject to the
         other provisions of this Agreement".  In addition,  liquidated  damages
         shall not be payable if the License Agreement is terminated as a result
         of Promus's default under the License Agreement.

                  Promus  acknowledges  that,  in the event of  actual  conflict
between  this  letter  agreement  and  the  License  Agreement,  the  terms  and
provisions of this letter  agreement shall control over the terms and provisions
of the License Agreement.  Without limiting the generality of the foregoing, (i)
no transfer of any interest in Fee Owner, or of fee ownership of the Hotel to an
affiliate of Fee Owner,  shall constitute a prohibited change of ownership under
the License Agreement,  subject,  however, to the penultimate  paragraph of this
letter  agreement,  (ii) no transfer of the leasehold  interest of Lessee in the
Hotel to a Successor  Lessee shall  constitute a prohibited  change of ownership
under the License Agreement, and (iii) in no event shall the initial Licensee be
liable for  liquidated  damages as the result of  termination  of the Percentage
Lease or

                                       6
<PAGE>

default  under the License  Agreement  if a Successor  Lessee is supplied by Fee
Owner or Fee Owner  enters  into a new License  Agreement  following a Tax Event
Notice,  and all prior curable defaults under the License Agreement are cured by
Fee Owner, as contemplated herein.

                  Fee Owner and Lessee agree with Promus as follows with respect
to the relationship of Promus and Lessee under the Management Agreement:

                  (a) Pursuant to the terms of the Percentage  Lease,  Fee Owner
         has agreed to pay, among other things, (i) land,  building and personal
         property taxes and assessments  applicable to the Hotel,  (ii) premiums
         and charges for  property  casualty  insurance  coverages  specified in
         Exhibit "D" to the Management Agreement, (iii) expenditures for capital
         replacements,   (iv)   expenditures   for  maintenance  and  repair  of
         underground  utilities and structural elements of the Hotel, (v) ground
         rent  under  the  Ground  Lease  and (vi) the  payments  of  principal,
         interest   and  other  sums   payable   under  the   Acquisition   Loan
         (collectively,  "Fee  Owner  Costs").  To  the  extent  the  Management
         Agreement  obligates or  authorizes  Promus to pay any Fee Owner Costs,
         Promus shall pay such Fee Owner Costs on behalf of Lessee to the extent
         of funds in the  Hotel's  bank  account(s)  (collectively,  the  "Hotel
         Accounts"),  including, without limitation, the Bank Account(s) and the
         Reserve  Fund (as such terms are defined in the  Management  Agreement)
         subject to any  limitations  contained in the Management  Agreement and
         Fee Owner and Lessee shall make such  adjustments  and payments to each
         other as may be  necessary  from time to time to take into  account any
         such  payments.  Promus shall have no duty,  obligation or liability to
         Fee Owner  (x) to make any  determination  as to  whether  any  expense
         required to be paid by Promus under the  Management  Agreement is a Fee
         Owner Cost or a cost of Lessee,  or (y) to make any determination as to
         whether funds in the Hotel Accounts  belong to Fee Owner or Lessee,  or
         (z) to require  that Fee Owner  Costs be paid from  funds  which can be
         identified  as  belonging  to Fee Owner,  or other  costs and  expenses
         required  to be  paid  by  Lessee  be  paid  from  funds  which  can be
         identified  as  belonging  to  Lessee;  it  being  the  intent  of this
         provision  that (i) Fee Owner and Lessee  shall look only to each other
         and not to Promus  with  respect to moneys  that may be owed one to the
         other  as  consequence  of  Promus's   performance  of  the  Management
         Agreement  and (ii)  Promus  need only look to Lessee to pay  operating
         costs,  including,  without limitation,  those designated herein as Fee
         Owner Costs.

                  (b) Promus shall be permitted  (and is hereby  authorized)  to
         set off  against  any  amounts  owed to  Promus  by  Lessee  under  the
         Management Agreement and the License Agreement any funds held by Promus
         pursuant to the Management  Agreement,  including  amounts in the Hotel
         Accounts,  whether or not amounts are due to Fee Owner by Lessee  under
         the Percentage Lease.

                  (c)  Fee  Owner  has  approved  the  form  of  the  Management
         Agreement and License  Agreement and agrees that Fee Owner's consent or
         approval is not required with respect to the  performance of any of its
         rights,  duties or obligations  under the  Management  Agreement or the
         License Agreement.

                                       7
<PAGE>

                  (d) Fee Owner  hereby  approves  the deposit of funds into the
         Reserve  Account and the  expenditure of funds from the Reserve Account
         by Promus in accordance with the terms of the Management Agreement.

                  (e) To the extent required by applicable laws, Fee Owner shall
         obtain and maintain (or  cooperate in obtaining  and  maintaining)  any
         licenses,  permits or approvals of any governmental authority necessary
         to  operate  and  manage the Hotel in  accordance  with the  Management
         Agreement.

                  (f) Fee Owner  acknowledges and agrees that,  unless it enters
         into a license  agreement  pursuant  to a Tax Event  Notice,  it has no
         right to use the Homewood  Suites(R)  "System"  except as expressly set
         forth in the License  Agreement nor any right to use the name "Homewood
         Suites"  or the  Homewood  Suites(R)  "System"  as a result  of  Lessee
         entering into the Hotel Agreements.

                  (g) Fee Owner acknowledges and agrees that any amounts owed to
         Promus under the License  Agreement  and the  Management  Agreement are
         superior  to any  amounts  owed  by  Lessee  to  Fee  Owner  under  the
         Percentage   Lease,   other  than   amounts  owed  in  respect  of  the
         Subordinated Management Fee, as defined in the Management Agreement, to
         the extent Lessee applies amounts  received in respect of Owner's Basic
         Return, as defined in the Management  Agreement,  in respect of amounts
         owed by Lessee to Fee Owner under the Percentage Lease.

                  (h) Fee Owner  agrees  not to amend or modify  the  Percentage
         Lease in any manner  that  would (i) reduce the term of the  Percentage
         Lease,  (ii)  increase the amount of rent payable by Lessee  thereunder
         (except as contemplated by the provisions of the Percentage  Lease), or
         (iii) have a material  adverse effect on any of the rights,  duties and
         privileges of Promus under the  Management  Agreement.  Nothing in this
         paragraph  (h) shall be deemed or  construed  to limit or restrict  Fee
         Owner's  rights to  terminate  or exercise  any other  remedy under the
         Percentage Lease in the event of a default by Lessee thereunder.

                  (i) Fee Owner  acknowledges and agrees that Promus has no duty
         or obligation to comply with any of the terms of the  Percentage  Lease
         and that Fee Owner  will look  solely to Lessee  with  respect  to such
         matters.

                  (j) Fee  Owner  acknowledges  and  agrees  that  (i) no  sale,
         transfer  or  conveyance  of Fee  Owner's fee estate in the Hotel shall
         terminate  the  Management  Agreement,  (ii) except as provided  below,
         neither the  termination of the Percentage  Lease nor the assignment of
         Lessee's interest therein shall terminate the Management Agreement, and
         (iii) no merger of the  leasehold  and fee simple  estates of the Hotel
         shall  terminate the Management  Agreement;  it being the intent of Fee
         Owner and Promus that the Management Agreement shall continue in effect
         for the  term of the  Management  Agreement  so  long as the  Hotel  is
         operating as a Homewood Suites(R) hotel pursuant to a license agreement
         and Manager is not in default of its  obligations  under the Management
         Agreement

                                       8
<PAGE>

         (subject,  however,  to any express rights of termination  contained in
         the Management Agreement).

                  (k) Fee Owner  acknowledges and agrees that Manager shall have
         a right to file a separate claim in any condemnation case in accordance
         with Article VIII of the Management Agreement.

                  (l) Fee Owner agrees that so long as the License  Agreement is
         in effect the casualty insurance proceeds will be applied in the manner
         provided in the License Agreement.

                  (m) In the event  that Fee  Owner  terminates  the  Percentage
         Lease  and as a  consequence  thereof  Promus  terminates  the  License
         Agreement  and does not enter  into a new  license  agreement  with any
         successor operator of the Hotel,  Promus and Fee Owner,  subject to the
         payment of all  amounts  owed under the  Management  Agreement  and all
         amounts  owed  under  the  Acquisition  Loan,  shall  have the right to
         terminate the Management Agreement covering the Hotel.  Otherwise,  the
         successor  operator  shall assume in writing the remaining term of such
         Management Agreement.

                  Fee Owner and Lessee further agree with Promus with respect to
the Acquisition  Loan that the Percentage Lease shall be subject and subordinate
to the  lien of the  Acquisition  Mortgage  Documents  and to all of the  terms,
conditions  and  provisions  thereof,  to  all  advances  made  or  to  be  made
thereunder,  and to any  renewals,  extensions,  modifications  or  replacements
thereof,  including any increases therein or supplements  thereto. The foregoing
provisions  shall be  self-operative.  However,  Fee Owner and  Lessee  agree to
execute and deliver to Promus such other  instrument  as Promus shall request in
order to effectuate said provisions.

                  It is  acknowledged  and  agreed  that  (i)  Promus  shall  be
entitled to rely upon any written  notice or request by Fee Owner made  pursuant
to the provisions  hereof without  requirement of investigating  the accuracy or
authenticity  of such  written  notice  or any  facts or  allegations  contained
therein, and (ii) Fee Owner shall be entitled to rely upon any written notice or
request by Promus made pursuant to the provisions hereof without  requirement of
investigating  the accuracy or  authenticity of such written notice or any facts
or allegations contained therein.

                  You agree to notify Promus by certified  mail at 755 Crossover
Lane, Memphis, Tennessee 38117-4900,  Attention:  General Counsel (or such other
address  as  Promus  may  specify  in a  written  notice  to you) of any  action
regarding  the Hotel to: (a) terminate the  Percentage  Lease;  (b) petition for
appointment of a Receiver or Trustee for Lessee to take any action under Federal
Bankruptcy  law or similar  state  laws;  or (c) take  possession  of the Hotel,
through a Successor Lessee or otherwise,  without  termination of the Percentage
Lease.

                  The rights,  powers and  interests of Promus  hereunder may be
transferred  and assigned by Promus,  without the prior  written  consent of Fee
Owner,  Lessee and, if applicable,  any Successor  Lessee, to any person to whom
the License Agreement and

                                       9
<PAGE>

Management  Agreement may be assigned.  The rights and obligations of Fee Owner,
Lessee and, if  applicable,  Successor  Lessee  hereunder  are not  transferable
without the written consent of Promus.

                  Subject to the foregoing  limitations,  this letter  agreement
shall  extend to, and shall  bind,  the  respective  successors  and  assigns of
Promus, Fee Owner,  Lessee and, if applicable,  any Successor Lessee,  provided,
however,  that in the case of Fee Owner,  this letter agreement shall not extend
to any  transferee  of Fee Owner's fee interest in the Hotel nor to Fee Owner if
Apple Suites, Inc. is not a publicly held REIT.

                                       10
<PAGE>

                  Please  indicate your  agreement with the terms of this letter
agreement by signing and returning four executed  copies to Promus.  This letter
may be executed by original  signature or by  signature  received by telecopy in
any number of  counterparts,  each of which shall be  original  and all of which
together shall constitute and be construed as one and the same instrument.

                                         Very truly yours,

                                         PROMUS HOTELS, INC.

                                         By  /s/  Stevan D. Porter
                                            -----------------------------
                                              Stevan D. Porter
                                              Executive Vice President

cc:      Franchise Administration

Accepted and Agreed:

APPLE SUITES, INC., as trustee for Apple
   Suites Pennsylvania Business Trust

By  /s/  Glade M. Knight
   -----------------------------------
     Name:  Glade M. Knight
     Title:    Chairman of the Board and President

Acknowledged and Agreed:

APPLE SUITES MANAGEMENT, INC.

By  /s/  Glade M. Knight
   -----------------------------------
     Name:  Glade M. Knight
     Title:    Chairman, CEO and PresidentExhibit 10.8

                               APPLE SUITES, INC.
                    c/o Cornerstone Realty Income Trust, Inc.
                              306 East Main Street
                            Richmond, Virginia 23219

                                                     May 8, 2000

Promus Hotels, Inc.
755 Crossover Lane
Memphis, Tennessee 38117-4900

                    Re:   Agreement of Sale dated November 22, 1999 (as amended,
                          the  "Purchase   Agreement";   capitalized  terms  not
                          otherwise  defined  herein  shall  have  the  meanings
                          ascribed  to such  terms  in the  Purchase  Agreement)
                          between  Hampton Inns,  Inc.,  Promus Hotels  Florida,
                          Inc. and Promus Hotels, Inc., as  Sellers,  and  Apple
                          Suites, Inc., as Buyer

Gentlemen:

                  Reference is made to (i) the Purchase  Agreement  and (ii) the
purchase money note of even date herewith made by the  undersigned in the amount
of $11,616,750 (the "Note") and the mortgages and/or deeds of trust and/or deeds
to  secure  debt  securing  the  Note   (individually  and   collectively,   the
"Mortgage").

                  We hereby agree that until such time as all amounts  evidenced
and secured by the Note and the Mortgage have been paid in full we shall not:

                  (i)  transfer,  or agree to transfer  (or suffer or permit the
         transfer or agreement to transfer),  in any manner,  either voluntarily
         or involuntarily,  by operation of law or otherwise, all or any portion
         of any of the properties located in Henrico County, Virginia,  Pinellas
         County,   Florida  and  Anne  Arundel   County,   Maryland   heretofore
         transferred  to us by  deeds  from  you  dated  September  20,  1999 or
         November 29, 1999 (the "Restricted  Properties"),  without, in any such
         case,  your prior  written  consent,  which  shall not be  unreasonably
         withheld  in the case of a  transfer  to any  affiliate  or  subsidiary
         wholly owned by Apple Suites, Inc.; or

                  (ii)  encumber,  or agree to encumber,  in any manner,  either
         voluntarily or involuntarily,  by operation of law or otherwise, all or
         any portion of any of the  Restricted  Properties,  or any  interest or
         rights therein  without,  in any such case, your prior written consent.
         As used in this clause,  "encumber" shall include,  without limitation,
         the placing or permitting  the placing of any mortgage,  deed of trust,
         assignment of rents or other security  device.  (It is understood  that
         you  may  grant  or  deny  your  consent  under  this  clause  and  the
         immediately preceding clause in your sole discretion).

<PAGE>

                  Notwithstanding  the foregoing,  it is understood that neither
the lease to Apple Suites Management, Inc. from us, dated September 20, 1999 nor
the Deed of Trust,  Assignment  of Leases and Rents and Security  Agreement  (or
other mortgage document) made by us and Apple Suites  Management,  Inc. for your
benefit  dated  September  20, 1999 or November  29,  1999,  shall  constitute a
violation of the foregoing restrictions.

                                             Very truly yours,

                                             APPLE SUITES, INC.,
                                             a Virginia corporation

                                             By /s/ Glade M. Knight
                                                --------------------------------
                                                Name:  Glade M. Knight
                                                Title: Chairman of the Board and
                                                       President

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00010-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00010-of-00352.parquet"}]]