Document:

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                                                                 Exhibit 10.20.C

                                                                           FINAL

                                 OWNER AGREEMENT
                              (HAUPPAUGE, NEW YORK)

     THIS OWNER AGREEMENT ("Agreement") is being entered into as of this 23rd
day of May, 2003, by and between APPLE HOSPITALITY FIVE, INC., a Virginia
corporation with a mailing address at 10 South Third Street, Richmond, Virginia
23219 ("Lessor"); APPLE HOSPITALITY FIVE MANAGEMENT, INC., a Virginia
corporation with a mailing address at 10 South Third Street, Richmond, Virginia
23219 ("Lessee"); and RESIDENCE INN BY MARRIOTT, INC., a Delaware corporation
with a mailing address at 10400 Fernwood, Bethesda, MD 20817 ("Manager").

                                    RECITALS:

     WHEREAS, Lessor owns fee simple title to that certain Residence Inn by
Marriott hotel located in the City of Hauppauge, County of Suffolk, State of New
York (the "Inn").

     WHEREAS, Lessor leased the Inn to Lessee, and Lessee leased the Inn from
Lessor, pursuant to that certain Master Hotel Lease dated as of the date hereof
and attached hereto as Exhibit A (the "Lease").

     WHEREAS, Lessee and Manager entered into that certain Management Agreement
dated as of the date hereof (the "Management Agreement") for the management of
the Inn by Manager.

     WHEREAS, Manager agreed to enter into the Management Agreement with Lessee
on the condition that Lessor and Lessee enter into this Agreement.

     WHEREAS, Lessor, Manager and Lessee desire to set forth certain obligations
of the parties with respect to the ownership and operation of the Inn and to
address certain portions of the Management Agreement which affect the rights and
obligations of all three parties.

     NOW, THEREFORE, for the mutual covenants and considerations herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto intending to be
legally bound agree as follows:

     1. Definitions. Capitalized terms not specifically defined herein shall
have the meaning provided in the Management Agreement.

     2. Lessor Consideration. Lessor hereby acknowledges that: (i) Lessor
derives and expects to derive benefits from this Agreement, and (ii) Lessor has
determined that Lessor's execution, delivery and performance of this Agreement
directly benefit Lessor, are within the corporate purposes of Lessor, and are in
the best interest of Lessor.

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     3. Acknowledgement of Lease. Manager hereby acknowledges and consents to
the lease of the Inn from Lessor to Lessee pursuant to the Lease in the form
attached hereto as Exhibit B. The Lease shall not be construed to impose any
additional obligations or liabilities upon Manager, and shall not be construed
to modify or amend any of the rights and duties of the parties under the
Management Agreement. To the extent that any of the provisions of the Management
Agreement impose a greater or inconsistent obligation on Lessee than the
corresponding provisions of the Lease, then Lessee shall be obligated to comply
with, and to take all actions necessary to prevent breaches or defaults under,
the relevant provisions of the Management Agreement.

     Manager acknowledges that Lessor and Lessee have, pursuant to the terms of
the Lease, agreed that Lessor shall pay, among other things (i) land, building
and personal property taxes and assessments applicable to the Inn, (ii) premiums
and charges for the casualty insurance coverages specified in the Management
Agreement (iii) expenditures for capital replacements, (iv) expenditures for
maintenance and repair of underground utilities and structural elements of the
Inn and (v) the payments of principal, interest and other sums payable under the
Loan Agreement (collectively, "Ownership Costs"). Manager shall have no duty,
obligation or liability to Lessor or Lessee (i) to make any determination as to
whether any expense required to be paid by Manager hereunder is an Ownership
Cost or a cost of Lessee, (ii) to require that Ownership Costs be paid from
funds which can be identified as belonging to Lessor, or that 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 the parties to this
Agreement that (i) Lessee and Lessor shall look only to each other and not to
Manager with respect to moneys that may be owed one to the other under the
Management Agreement and (ii) Manager need only look to Lessee to pay operating
costs of the Inn and other such obligations under the Management Agreement,
including, without limitation, those designated herein as Ownership Costs.

     4. Lessor and Lessee Representations and Warranties. Lessor and Lessee each
hereby represents and warrants that Lessor currently maintains a direct or
indirect (currently a one-hundred percent) controlling and majority interest in
Lessee. With respect to a sale, assignment or transfer of the Inn by Lessor or
Lessee to an Affiliate of Owner that is permitted under the Management
Agreement, the parties having an interest in the Inn after such permitted sale,
assignment or transfer shall have an ownership relationship that is in form and
substance similar to that of Lessor and Lessee (including, without limitation,
Lessor's controlling and majority interest in Lessee), in order to ensure that
Manager will incur no greater liability, cost or risk of termination of the
Management Agreement as a result of such permitted sale, assignment or transfer;
provided, however, that in the event of actual conflict between the terms and
provisions of this Agreement and the terms and provisions of the Management
Agreement, the terms and provisions of the Management Agreement shall control.

     5. Termination of the Lease. The parties agree that the Management
Agreement and the rights and benefits of Manager thereunder shall not be
terminated or disturbed in any respect except in accordance with the terms of
the Management Agreement, and not as a result of any termination of the Lease.
Accordingly, if the Lease is terminated for any reason, including, without
limitation, expiration of the term thereof or the "rejection" thereof following
Bankruptcy

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(as defined below) of Lessee (collectively, a "Lease Termination"), Lessor: (a)
shall recognize Manager's rights under the Management Agreement, (b) agrees that
Manager shall not be named as a party in any eviction or other possessory action
or proceeding, and that Manager shall not be disturbed in its right to manage
the Inn pursuant to the Management Agreement, and (c) shall at the time of or
prior to such Lease Termination either (i) elect not to take either of the
actions described in clause (c)(ii) below, in which case all of "Lessee's"
rights, benefits, privileges and obligations under the Management Agreement with
respect to periods after the Lease Termination shall be assumed directly by
Lessor, or (ii) cause an "Approved Lessee" (as defined below) to (x) succeed to
and assume Lessee's rights and obligations under the Lease, the Management
Agreement, and this Agreement, or (y) enter into a new lease with Lessor in
substantially the same form as the Lease, and assume the rights and obligations
of the Lessee under the Management Agreement and this Agreement, the intent
being that the relationship between any successor Lessee, Lessor and Manager be
under the same terms and conditions as the relationship between Lessee, Lessor
and Manager hereunder and under the Management Agreement and the Lease. Any
successor to Lessee under clause (c)(ii) above shall be subject to Manager's
prior written approval, which approval shall not be withheld or delayed if such
successor to Lessee is (i) a direct or indirect wholly-owned subsidiary of
Lessor, (ii) a person or entity to whom a Sale of the Inn is permitted under
Section 10.02.A. of the Management Agreement, or (iii) a person or entity who
otherwise is approved by Manager in its sole discretion (an "Approved Lessee").

     6. Guaranty. Lessor shall be liable for the complete and satisfactory
payment and performance of each and every obligation of Lessee as "Lessee" under
the Management Agreement (the "Guarantied Obligations"). Lessor hereby
absolutely, irrevocably, and unconditionally guaranties that the Guarantied
Obligations which are monetary obligations shall be paid when due and payable
and that the Guarantied Obligations which are performance obligations shall be
fully performed at the times and in the manner such performance is required by
the Management Agreement. This guaranty is an absolute, irrevocable, and
unconditional guaranty of payment and performance and the liability of Lessor
hereunder shall be absolute and unconditional irrespective of: (i) any lack of
validity, irregularity or enforceability of the Management Agreement or this
Agreement; (ii) any change in the time, manner, place or any other term or
condition of payments due under the Management Agreement or this Agreement, or
any other amendment or waiver of, or consent to, or any departure from the
Management Agreement or this Agreement; (iii) any failure of Manager to enforce
the provisions of the Management Agreement or this Agreement against Lessee; or
(iv) any other circumstances which might otherwise constitute a defense
available to, or a discharge of, any of the Guarantied Obligations (other than
because, or to the extent, the same have been previously discharged in
accordance with the terms of the Management Agreement). If all or any part of
the Guarantied Obligations shall not have been paid when due and payable or
performed at the time performance is required, Lessor (without first requiring
the Manager to proceed against Lessee or any other party or any other security)
shall pay or cause to be paid to Manager the amount thereof as is then due and
payable and unpaid (including interest and other charges, if any, due thereon
through the date of payment in accordance with the applicable provisions of the
Management Agreement) or perform or cause to be performed such obligations in
accordance with the Management Agreement, within ten (10) Business Days after
receipt of written notice from the Manager of the failure by Lessee to make such
payment or render such performance;

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provided, however, that, notwithstanding the foregoing, Lessor shall have the
right, in connection with a demand by Manager for payment by Lessor of
Guaranteed Obligations, to assert any defenses or claim of Lessee under the
Management Agreement with respect to such Guaranteed Obligations. If for any
reason Lessor fails to perform or cause to be performed such obligations,
Manager shall have the right to exercise any and all of the remedies available
at law or in equity and Lessor hereby agrees to pay any and all reasonable
expenses (including counsel fees and expenses) incurred by Manager in enforcing
its rights under this Agreement. The guaranty contained in this Agreement: (i)
is a continuing guaranty and shall remain in full force and effect until the
indefeasible satisfaction and discharge in full of Lessee's obligations as
"Lessee" under the Management Agreement and Lessor's and Lessee's obligations
under this Agreement, and (ii) shall continue to be effective or shall be
reinstated, as the case may be, if at any time any payment under the Management
Agreement or this Agreement becomes unrecoverable from Lessee by operation of
law or for any other reason or must otherwise be returned by Manager upon the
insolvency, bankruptcy or reorganization of Lessor or Lessee.

     7. Obligation to Terminate Lease Upon Lessee Default under Management
Agreement. Upon receiving a written request from Manager to do so (and provided
that Manager has sent to Lessor a notice as described in Section 6 above with
respect to the applicable Default), Lessor shall terminate the Lease if an Event
of Default by Lessee has occurred under the Management Agreement. In terminating
the Lease pursuant to this Section 7, Lessor shall issue its notice of
termination to Lessee promptly following its receipt of Manager's request
therefor. Lessor shall thereafter promptly initiate, and thereafter diligently
and continuously prosecute, such actions as may be required to confirm such
Lease termination and repossess the Inn, including, without limitation,
instituting such legal action as may be necessary to accomplish same. Upon
Lessor's termination of the Lease in accordance with this Section 7, Lessor
shall thereupon be obligated to comply with the provisions of Section 5
applicable upon a Lease Termination.

     8. Agreements Relating to Tenancy. In order to address the fact that
Lessee's interest in the Site and the Inn is leasehold, and to address certain
other related matters, the parties agree to the following modifications of the
Management Agreement, to be effective for so long as Lessee's interest in the
Site and Inn is held through tenancy title as that of Lessee:

     A. Subject to the terms of the Management Agreement, Lessor and Lessee
covenant and agree, and Manager acknowledges, that: (i) Lessor holds, and shall
have, keep and maintain throughout the term of the Management Agreement, good
and marketable fee title to the Inn and Site; (ii) Lessee holds, and shall have,
keep and maintain throughout the term of the Management Agreement, leasehold
title to the Inn and Site free and clear of any and all liens, encumbrances or
other charges, except for those specifically set forth in Section 8.01.A. of the
Management Agreement.

     B. In connection with a "Sale of the Inn" that is consented to by Manager
under Article X of the Management Agreement, Lessor and Lessee agree that an
agreement in form and substance similar to this Agreement will be required in
order to ensure that Manager will incur no greater liability, cost or risk of
termination of the Management Agreement as a result of such "Sale of the Inn".

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     C. If Lessor hereafter encumbers the Site and/or the Inn with a Mortgage,
the Subordination Agreement required in Article VIII of the Management Agreement
with respect to such Mortgage shall be modified (i) to account for the facts
that Lessor (rather than Lessee) has encumbered the Site and/or the Inn with
such Mortgage, and (ii) to provide that the parties' rights and obligations
under such Subordination Agreement shall, as applicable, apply to both the
Management Agreement and this Agreement.

     9. Additional Lessor Obligations.

     A. Lessor agrees to fully and timely comply with all notice requirements
set forth in Section 10.02 of the Management Agreement with respect to a Sale of
the Inn. Lessor further acknowledges and agrees that any failure by Lessor to
timely provide notice to Manager as set forth in Section 10.02 of the Management
Agreement with respect to a Sale of the Inn shall extinguish any right of Lessor
to enter such Sale.

     B. Lessor agrees, where applicable, upon request by Manager, not to
unreasonably withhold, condition or delay the prompt signing, without charge, of
applications for licenses, permits or other instruments necessary for operation
of the Inn, which applications shall be prepared by Manager as necessary from
time to time. Lessor further agrees to fully and timely comply with and perform
all of the duties and obligations to be performed by Lessee as "Owner" under the
Management Agreement, including but not limited to, those duties and obligations
set forth in Sections 1.01, 1.02.D, 4.07, 7.01, 7.02 8.01, 8.02, 8.03, 8.04,
10.01, 10.02, 11.05, 11.08, 11.09 and 11.12, of the Management Agreement.

     C. Lessor covenants and agrees to exercise (as required or appropriate
subject to the terms hereof) and perform all of its rights, duties and
obligations as "landlord" or "lessor" under the Lease.

     D. Lessor agrees to forward promptly to Manager a true and complete copy of
any and all material notices received by Lessor with respect to the Lease,
including, without limitation, each and every notice of default by Lessor that
Lessor receives in respect of the Lease, and each and every notice of default by
Lessee given by Lessor in respect of the Lease.

     E. Lessor shall not, without the prior written consent of Manager, cause,
effect, initiate, grant, enter into, accept, permit, consent to, or acquiesce
in, an amendment, termination, or a surrender, of the Lease.

     F. Lessor covenants and agrees to enforce, short of termination, the terms,
conditions and provisions of the Lease for the benefit of Manager and the Inn.

     10. Certain Provisions Regarding Bankruptcy. In the event the Lease shall
be rejected on behalf of Lessor under Section 365 of the United States
Bankruptcy Code ("Code") or any other applicable law or authority ("Rejection"),
Lessee shall promptly notify Manager in writing of such Rejection and Lessee
shall, as directed by Manager, either treat the Lease as terminated by such
Rejection or retain its rights under the Lease as permitted by the Code or other
applicable law or authority. In the event the Management Agreement is terminated
as a

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result of Rejection on behalf of Lessee, the Management Agreement will remain
effective with respect to Lessor, and Lessor shall, if directed by Manager (but
only to the extent such right may be exercised under the Code or other
applicable law and authority), terminate the Lease, subject to the provisions of
Section 5 hereof. Lessor and Lessee each agree that it will not join in any
involuntary petition against the other under the Code or any other similar
federal or state law providing for debtor relief, without the consent of
Manager.

     11. Term. The term of this Agreement shall commence on the date set forth
above and shall run concurrently with the term of the Management Agreement.

     12. Required Assignment. In connection with any Sale of the Inn which
includes a transfer of Lessor's and/or Lessee's title in the Site and/or the
Inn, Lessor and Lessee agree that the successors to their respective titles in
the Site and/or the Inn shall also assume their respective rights and
obligations under this Agreement and shall cause such successor(s) to assume
such rights and obligations pursuant to an assumption of this Agreement
reasonably acceptable to Manager.

     13. Notices. All notices and other communications provided for hereunder
shall be in writing, and shall be sent or delivered by the methods and to the
addresses for Lessee and Manager as required under the Management Agreement. The
address for Lessor for purposes of such notices is as follows:

          Apple Hospitality Five, Inc.
          c/o Apple Real Estate Investment Trust Companies
          Attn: Samuel F. Reynolds, Director of Acquisitions/ Dispositions &
                Portfolio Management
          Attn: General Counsel
          Phone: (804) 344-8121
          Fax:   (804) 344-8129

     14. Eligible Independent Contractor. Manager agrees that, as of the date
hereof, it is an eligible independent contractor under Section 856(d) of the
Internal Revenue Code, and further agrees that it shall maintain such status to
the extent it is able to do so, acknowledging that events outside of Manager's
control may result in an overlap of ownership between Manager and Lessor or
Lessee which could affect Manager's independent contractor status. Lessor,
Manager and Lessee agree to cooperate in good faith to ensure that Manager
retains such status. This covenant shall apply for so long as the Inn is owned
by Lessor (or another direct or indirect wholly-owned subsidiary of Apple
Hospitality pursuant to a permitted assignment) and leased to Lessee (or another
direct or indirect wholly-owned subsidiary of Apple Hospitality pursuant to a
permitted assignment) as part of an ownership structure that is subject to REIT
tax requirements.

     15. Miscellaneous.

     A. Modification of this Agreement. No amendment, modification, alteration
or waiver of any provision of this Agreement shall be effective unless it is in
writing and signed by the party against whom enforcement of such amendment is
sought, and no waiver of any

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provision of this Agreement by any party hereto, and no consent to any departure
therefrom by any party hereto, shall be effective unless it is in writing and
signed by the party against whom enforcement of such waiver or consent is
sought, and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.

     B. No Waiver. No failure by any party hereto to exercise, and no delay in
exercising, any right under the Management Agreement or this Agreement shall
operate as a waiver thereof, nor shall any single or partial exercise of any
right preclude any other or further exercise thereof or the exercise of any
other right.

     C. Remedies Cumulative. The rights and remedies of any party hereto
provided in the Management Agreement and this Agreement are cumulative and are
in addition to, and not exclusive of, any rights or remedies provided by law or
equity.

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

     E. Severability. The invalidity, illegality or unenforceability of any one
or more phrases, sentences, clauses or sections contained in this Agreement
shall not affect the validity, legality or enforceability of the remaining
portions of this Agreement.

     F. Entire Agreement. This Agreement, together with the Management Agreement
the Lease, and those certain letter agreements dated of even date herewith
concerning the procurement of property insurance constitute the entire agreement
and supersede all prior agreements and understandings, both written and oral,
between the parties hereto with respect to the subject matter hereof.

     G. Successors and Assigns. The parties hereto shall not assign or transfer
or permit the assignment or transfer of this Agreement without the prior written
consent of the other parties hereto, except that Lessee and Manager shall each
have the right and obligation to assign its respective interest in this
Agreement to any party to which its respective interest in the Management
Agreement may be assigned under the terms of the Management Agreement, and
Lessor shall have the right and obligation to assign its interest in this
Agreement to any party to which its interest in the Site and Inn may be
assigned, subject to the requirements of the Management Agreement.

     H. Captions. The captions and headings of the sections and subsections of
this Agreement are for purposes of convenience and reference only and shall not
limit or otherwise affect the meaning hereof.

     I. Time of the Essence. Time shall be of the essence in the performance of
this Agreement.

     J. Incorporation of Recitals. The recitals hereto are incorporated herein
as part of this Agreement.

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     K. Counterparts - This Agreement may be executed simultaneously in several
counterparts, each of which shall be deemed an original, but each of which,
taken together with the others shall constitute one and the same instrument.

                        [SIGNATURES FOLLOW ON NEXT PAGE]

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

                                        LESSOR:

                                        APPLE HOSPITALITY FIVE, INC.,
                                        a Virginia corporation

                                        By: /s/ J. Philip Hart
                                            ------------------------------------
                                        Name:  J. Philip Hart
                                        Title: Senior Vice President

                                        LESSEE:

                                        APPLE HOSPITALITY FIVE MANAGEMENT, INC.,
                                        a Virginia corporation

                                        By: /s/ J. Philip Hart
                                            ------------------------------------
                                        Name:  J. Philip Hart
                                        Title: Senior Vice President

                                        MANAGER:

                                        RESIDENCE INN BY MARRIOTT, INC.,
                                        a Delaware corporation

                                        By: /s/ Joel Eisemann
                                            ------------------------------------
                                        Name:  Joel Eisemann
                                        Title: Vice President

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                                    Exhibit A

                                      Lease

                                      -10-<PAGE>

                                                                   Exhibit 10.21

                                ESCROW AGREEMENT

     THIS ESCROW AGREEMENT (this "Agreement") is made as of April 1, 2003 by and
among BRIAD LODGING GROUP SOMERSET, LLC, a New Jersey limited liability company,
BRIAD LODGING GROUP WALLINGFORD, LLC, a New Jersey limited liability company,
BRIAD DEVELOPMENT WEST, LLC, a New Jersey limited liability company, BRIAD
DEVELOPMENT EAST, LLC, a New Jersey limited liability company, and BRIAD
RESTAURANT GROUP, LLC, a New Jersey limited liability company (collectively,
"Sellers"); BRIAD RESTAURANT GROUP, LLC, a New Jersey limited liability company
("BRG"); APPLE HOSPITALITY FIVE, INC., a Virginia corporation ("Buyer";
collectively with Sellers and BRG, the "Parties"); and LANDAMERICA - DALLAS
NATIONAL DIVISION ("Escrow Agent").

                                 R E C I T A L S

     WHEREAS, pursuant to the Purchase Contract dated as of April 1, 2003 (the
"Original Contract") among Briad Lodging Group Hauppauge, LLC, Briad Lodging
Group Franklin, LLC and Briad Lodging Group Cranbury, LLC (the "Original
Sellers"), BRG and Buyer, the Original Sellers agreed to sell and Buyer agreed
to purchase certain hotel properties, more particularly described therein;

     WHEREAS, as contemplated by the Original Contract, Sellers and Buyer agreed
to enter into this Agreement, pursuant to which Sellers will grant to Buyer an
exclusive right to negotiate with Sellers for the purchase of certain additional
hotel properties, more particularly described hereinafter, and Buyer will
deposit with Escrow Agent the sum of $500,000 to be held in escrow upon the
terms and conditions of this Agreement; and

     WHEREAS, Escrow Agent has agreed to act as escrow agent in accordance with
the provisions, upon the terms, and subject to the conditions, of this
Agreement.

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

     1. Appointment of Escrow Agent. Sellers 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.

     2. The Deposit. Upon the closing of the transactions contemplated by the
Original Contract, Buyer shall deliver the sum of $500,000 (the "Deposit") to
Escrow Agent. Subject to the rights and obligations of the Parties to direct the
investment, transfer, delivery or otherwise disposition of the Deposit pursuant
to this Agreement, Escrow Agent shall keep the Deposit in Escrow Agent's
possession, in escrow, pursuant to this Agreement. Escrow Agent shall invest the
Deposit as directed by Buyer. Any interest or other sums earned on investments
of the Deposit shall belong solely to Buyer.

<PAGE>

     3. Term. The term of this Agreement (the "Term") shall commence on the date
hereof and shall expire six (6) months thereafter; provided, however, that (i)
if the Original Contract is terminated on account of the failure of the Parties
to close the transactions contemplated thereby, the Term shall expire on the
date of such termination and (ii) if the closing occurs under the Original
Contract but the Parties fail to enter into the "Initial Purchase Contract"
within the "Initial Purchase Period" (as such terms are defined hereinafter),
the Term of this Agreement shall expire upon the expiration of the Initial
Purchase Period. However, the expiration of the Term shall not affect any rights
or obligations of the Parties that may have accrued hereunder before the date of
such expiration or the rights or obligations of the Parties under any provisions
of this Agreement other than Section 4 below.

     4. Exclusive Right of Negotiation. Sellers hereby grant to Buyer an
exclusive right during the Term to negotiate with Sellers for the purchase of
the six (6) properties described in Exhibit A attached hereto (collectively, the
"Properties"; individually, a "Property"). During the Term, each of the Parties
will use all commercially reasonable, diligent and good faith efforts to
negotiate the terms and conditions under which Sellers will sell and Buyer will
purchase the Properties, such terms and conditions to be set forth in one or
more definitive contracts of purchase as the Parties may agree, substantially
upon the same terms and conditions as set forth in the Original Contract, except
for matters specific to each of the Properties and except as otherwise noted
herein. In addition, during the Term, Sellers will use all commercially
reasonable, diligent and good faith efforts (i) to keep all outstanding purchase
or option contracts for any of the Properties in full force and effect, in each
case so as to enable Sellers to comply with their obligations under this
Agreement, (ii) to consummate the purchase of the three Properties designated on
Exhibit A as "Homewood Suites-Somerset, NJ," "Homewood Suites-Wallingford, CT"
and "Residence Inn-Mount Olive, NJ," respectively (collectively, the "Initial
Properties"), (iii) upon execution by Buyer and Sellers of the Initial Purchase
Contract, to construct the hotels on the Initial Properties as indicated in
Exhibit A, (iv) to keep any franchise agreements with any of the hotel chains
indicated on Exhibit A, which Sellers may enter into in advance of closing the
sale of any of the Properties, in full force and effect and (v) to obtain all
permits, approvals and authorizations as may be required to develop each of the
remaining Properties and to construct thereon the hotels indicated in Exhibit A.
Notwithstanding anything contained in this Agreement to the contrary, the
Parties agree that (a) the purchase price for any Property shall not exceed the
product of $120,000 times the number of rooms in the hotel constructed on the
Property, (b) in the event that Sellers enter into any franchise agreements
before closing on the sale of the Properties to Buyer, Buyer shall pay for any
transfer or assumption fee charged by the franchisor and (c) Sellers shall pay
for any prepayment or similar fee in connection with the payoff of any mortgage
loan on the Properties and shall pay any real estate transfer and recordation
taxes and fees. During the Term, Sellers shall not solicit, entertain or accept
any offers from third parties to purchase or lease any of the Properties or
negotiate with any third party for the purchase and sale or lease of any of the
Properties, nor shall Sellers list any of the Properties with a real estate
broker or agent or otherwise advertise the same for sale.

     5. Initial Purchase Contract.

          (a) If, within the period beginning on the date hereof and ending four
(4) months thereafter (the "Initial Purchase Period"), the Parties enter into a
definitive, written contract (the "Initial Purchase Contract") to sell and
purchase not less than all of the Initial

                                       2

<PAGE>

Properties, then the Deposit shall be disbursed to Escrow Agent to be held as an
earnest money deposit under the Initial Purchase Contract and to be applied to
the purchase price of the Initial Properties, or disbursed to Sellers or Buyer,
in accordance with the terms and conditions of the Initial Purchase Contract.

          (b) If, before the expiration of the Initial Purchase Period, the
Parties fail to enter into a definitive, written contract to sell and purchase
the Initial Properties and such failure is not on account of a default by any of
Sellers of its obligations under this Agreement, then the Deposit shall be
disbursed to Sellers upon its request, and thereafter neither Party shall have
any further obligation under this Agreement with respect to the sale or purchase
of the Properties.

          (c) If, before the expiration of the Initial Purchase Period, the
Parties fail to enter into a definitive, written contract to sell and purchase
the Initial Properties and such failure is on account of a default by any of
Sellers of its obligations under this Agreement, then the Deposit shall be
disbursed to Buyer upon its request, and thereafter neither Party shall have any
further obligation under this Agreement with respect to the sale or purchase of
the Properties.

     6. Procedure for Claiming Deposit.

          (a) If, at any time after the Initial Purchase Period, Sellers claim
entitlement to the Deposit, Sellers shall give written notice to Escrow Agent
stating that it is entitled to the Deposit in accordance with the terms of this
Agreement, and shall direct Escrow Agent to release the Deposit to Sellers (the
"Seller's Notice"). Escrow Agent shall promptly deliver a copy of Seller's
Notice to Buyer. Buyer shall have three (3) days after receipt of the copy of
Seller's Notice to deliver written notice to Escrow Agent and Sellers objecting
to the release of the Deposit to Sellers ("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 Sellers. If Escrow Agent
does receive a timely Seller's Objection Notice, Escrow Agent shall release the
Deposit only upon receipt of, and in accordance with, written instructions
signed by Buyer and Sellers, or the final order of a court of competent
jurisdiction.

          (b) If, at any time after the Initial Purchase Period, Buyer claims
entitlement to the Deposit, Buyer shall give written notice to Escrow Agent
stating that Buyer is entitled to the return of the Deposit in accordance with
the terms of this Agreement and shall direct Escrow Agent to return the Deposit
to Buyer (the "Buyer's Notice"). Escrow Agent shall promptly deliver a copy of
Buyer's Notice to Sellers. Sellers shall have three (3) 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 to Buyer ("Seller's Objection Notice").
If Escrow Agent does not receive a timely Seller's Objection Notice, Escrow
Agent shall release the Deposit to Buyer. If Escrow Agent does receive a timely
Seller's Objection Notice, Escrow Agent shall release the Deposit only upon
receipt of, and in accordance with, written instructions signed by Sellers and
Buyer, or the final order of a court of competent jurisdiction.

     7. Limitations on Liability and Duties of Escrow Agent.

          (a) 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

                                       3

<PAGE>

signed by 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.

          (b) 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.

          (c) 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.

          (d) 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 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.

          (e) 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 subsection (f) below, in each case, without liability or
responsibility.

          (f) 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 Commonwealth of Virginia 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,

                                       4

<PAGE>

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.

          8. 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 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:

               (i)  If addressed to Sellers, to:

                    c/o The Briad Group
                    30A Vreeland Road
                    Florham Park, New Jersey 07932
                    Attn: Brad Honigfeld, President
                    Fax No.: 973-822-4511

               (ii) If addressed to Buyer, to:

                    Apple Suites Realty Group, Inc.
                    10 South Third Street
                    Richmond, Virginia 23219
                    Attn: Glade M. Knight, President
                    Fax No.: (804) 344-8129

              (iii) If addressed to Escrow Agent, to:

                    LandAmerica - Dallas National Division
                    7557 Rambler Road, Suite 1200
                    Dallas, Texas 75231
                    Attn: David Long
                    Fax No.: (214) 346-7131 or (877) 556-8112

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.

          9. Counterparts. 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.

                                       5

<PAGE>

          10. Successors and Assigns. 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. Buyer acknowledges
that certain of the Sellers may assign existing purchase contracts for the
Properties to affiliates of such Sellers, but any assignee shall assume the
assigning Seller's obligations under this Agreement and any such assignment
shall not relieve BRG from any of its obligations under Section 11 of this
Agreement.

          11. Joinder by BRG. BRG joins in this Agreement and hereby covenants
and agrees that (i) BRG is and shall be jointly and severally liable with
Sellers for the performance of all of Sellers' obligations and liabilities under
this Agreement, (ii) BRG's obligations hereunder shall not be limited,
diminished or impaired in any way by virtue of any right or remedy Buyer may
have against Sellers under this Agreement or any other provision of this
Agreement, (iii) Buyer shall not be obligated to proceed first against Sellers
before resorting to BRG for payment or performance and (iv) BRG shall not be
entitled to assert as a defense to the enforceability of its covenants and
agreements hereunder any defense of Sellers with respect to any liabilities or
obligations of Sellers to Buyer. BRG shall also join in the Initial Contracts
and any other contracts of sale for the Properties for the same purpose that BRG
has joined in this Agreement.

                                       6

<PAGE>

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

                                          SELLERS:

                                          BRIAD LODGING GROUP SOMERSET, LLC

                                          By:    /s/ Brad Honigfeld
                                                 -------------------------------
                                          Name:  Brad Honigfeld
                                          Title: Sole Member

                                          BRIAD LODGING GROUP WALLINGFORD, LLC

                                          By:    /s/ Brad Honigfeld
                                                 -------------------------------
                                          Name:  Brad Honigfeld
                                          Title: Sole Member

                                          BRIAD DEVELOPMENT WEST, LLC

                                          By:    /s/ Brad Honigfeld
                                                 -------------------------------
                                          Name:  Brad Honigfeld
                                          Title: Sole Member

                                          BRIAD DEVELOPMENT EAST, LLC

                                          By:    /s/ Brad Honigfeld
                                                 -------------------------------
                                          Name:  Brad Honigfeld
                                          Title: Sole Member

                                          BRIAD RESTAURANT GROUP, LLC

                                          By:    /s/ Brad Honigfeld
                                                 -------------------------------
                                          Name:  Brad Honigfeld
                                          Title: Sole Member

                                          BRG:

                                          BRIAD RESTAURANT GROUP, LLC

                                       7

<PAGE>

                                          By:    /s/ Brad Honigfeld
                                                 -------------------------------
                                          Name:  Brad Honigfeld
                                          Title: Sole Member

                                          BUYER:

                                          APPLE HOSPITALITY FIVE, INC.

                                          By:    /s/ Glade M. Knight
                                                 -------------------------------
                                                 Glade M. Knight,
                                                 President

                                          ESCROW AGENT:

                                          LANDAMERICA - DALLAS NATIONAL DIVISION

                                          By:    /s/ John Pettiette
                                                 -------------------------------
                                          Name:  John Pettiette
                                          Title: VP/Sr. Commercial Counsel

                                       8

<PAGE>

                                    EXHIBIT A

                                   Properties

<TABLE>
<CAPTION>
                                                     Owner/Contract
Property                                 Rooms         Purchaser                             Location
--------------------------------------   -----   -----------------------   ---------------------------------------------
<S>                                       <C>    <C>                       <C>
Homewood Suites - Somerset, NJ            123    Briad Lodging Group       Located at the SW quadrant of I-287
                                                 Somerset, LLC             (Exit 10, Route 527 Easton Avenue) and Worlds
                                                                           Fair Drive on Pierce Street

Homewood Suites - Wallingford, CT         104    Briad Lodging Group       Located at the SW quadrant of I-91
                                                 Wallingford, LLC          and Route 68 (Barnes Road, Exit 15)

Residence Inn - Rocky Hill, CT            96     Briad Development West,   Located at the NW quadrant of I-91
                                                 LLC                       and West Street (Exit 23) at Cromwell Avenue

Residence Inn - Mount Olive, NJ           123    Briad Development East,   Located at the NW quadrant of I-80
                                                 LLC                       and Route 206 (Exit 25)

Residence Inn - Bridgewater, NJ           120    Briad Development East,   Located at the SW quadrant of I-287
                                                 LLC                       and Route 22

Courtyard by Marriott - Farmington, CT    119    Briad Restaurant Group,   Located at the SE quadrant of I-84 and
                                                 LLC                       Route 71 (Exit 40)
</TABLE>

                                       9

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