Document:

GUARANTY
This GUARANTY (the “Guaranty”) is made as of May 13, 2022, by LODGING FUND REIT III OP, LP, a Delaware limited partnership (“Guarantor”), to and for the benefit of WESTERN ALLIANCE BANK, an Arizona corporation (“Lender”).  
RECITALS:
A.Lender has agreed to lend LF3 EL PASO AIRPORT, LLC, a Delaware limited liability company and LF3 EL PASO AIRPORT TRS, LLC, a Delaware limited liability company (individually and collectively, jointly and severally, the “Borrower”) up to $9,990,000.00 (the “Loan”) in accordance with the terms of the Loan Agreement, of even date herewith, between Lender and Borrower (the “Loan Agreement”).  Capitalized terms used in this Guaranty and not defined in the Guaranty have the meanings given to such terms in the Loan Agreement.  
B.Lender requires, as a condition precedent to making the Loan, that Borrower obtain this Guaranty duly executed by Guarantor.  Lender will be relying on this Guaranty in making the Loan.  The making of the Loan by Lender to Borrower is of value to each Guarantor and is reasonably expected to benefit Guarantor.
AGREEMENT
In consideration of Lender making the Loan, as an inducement for Lender to do so, and for other valuable consideration, Guarantor represents, warrants, agrees, and covenants as follows: 
1.Carveout Guaranty. 
(a)Limited Recourse Guaranty.  Guarantor unconditionally, absolutely and irrevocably agrees to indemnify, defend and hold Lender harmless for, and guarantees in full to Lender and its Affiliates the payment and performance of, all of the Limited Obligations, as and when the same shall be due and payable, whether by lapse of time, by acceleration of maturity or otherwise.  Guarantor hereby irrevocably and unconditionally covenants and agrees that it is liable for the Limited Obligations as a primary obligor.  As used in this Guaranty, the term “Limited Obligations” means any and all actual Liabilities that may be imposed on, incurred by or asserted against Lender or its Affiliates arising out of or in connection with any of the following: 
(i)(1) The commission of a criminal act by any Credit Party, LF III, Adviser, or any Affiliate of such Persons, (2) any violation of securities laws, rules or regulations as determined by a non-appealable court order within a competent jurisdiction by any Credit Party, LF III, Adviser, or any Affiliate of such Persons, or (3) the seizure by or forfeiture to any Government Authority of any Collateral or of any equity interest in a Credit Party;
(ii)The failure by Borrower or any Credit Party to apply any funds derived from the Collateral, including operating revenues, security deposits, Insurance Proceeds and Condemnation Proceeds (as defined in the Mortgage), as required by the Loan Documents;
(iii)Fraud or misrepresentation of any Credit Party made in or in connection with the Loan Documents or the Loan;
(iv)Any Credit Party contests or in any way interferes, directly or indirectly, with (A) any foreclosure action, trustee’s sale, UCC sale, or other action or proceeding to realize upon the Collateral; (B) any receivership proceeding; (C) the enforcement of the assignment of rents and leases in the Mortgage; or (D) any other enforcement of Lender’s rights, powers, and remedies under any of the Loan Documents pursuant to which Lender has a Lien (whether by making any motion, bringing any counterclaim, claiming any defense, seeking any injunction or other restraint, commencing any action seeking to consolidate any such enforcement action by Lender or any Lender Affiliate with any other action, or otherwise);

(v)Borrower’s failure to pay Impositions (as defined in the Mortgage) or maintain the insurance coverages required pursuant to the Loan Documents and pay all insurance premiums therefor;
(vi)Damage or destruction to the Collateral caused by the acts or omissions of any Credit Party or any employee, agent, contractor, representative, invitee, or licensee of any Credit Party or the commission by any Credit party of any act of waste with respect to the physical Collateral;
(vii)The failure of any Credit Party to perform its obligations with respect to environmental matters under any environmental indemnity or similar agreement;
(viii)Borrower’s failure to pay for any loss, liability or expense (including attorneys’ fees) incurred by Lender arising out of any claim or allegation made by Borrower, its successors or assigns, or any creditor of Borrower, that the Loan Agreement or the transactions contemplated by the Loan Documents establish a joint venture, partnership or other similar arrangement between Borrower and Lender;
(ix)Any brokerage commission or finder’s fees claimed in connection with the transactions contemplated by the Loan Documents;
(x)Uninsured damage to the Collateral resulting from acts of terrorism;
(xi)Borrower’s breach of its obligations under Section 3.10 of the Mortgage;
(xii)The removal or disposal of any tangible personal property Collateral from the Site in violation of the terms and conditions of the Loan Documents or the abandonment or surrender of any Collateral of whatever type or character;
(xiii)The failure by any Credit Party to comply with its indemnification obligations pursuant to the Loan Documents; or
(xiv)The payment of any distributions to any Credit Party or any Affiliate of a Credit Party, other than as permitted in the Loan Documents.
Guarantor shall also be personally liable to Lender for reasonable attorney's fees and other costs and expenses incurred by Lender in connection with any of the foregoing or in enforcing its rights and remedies pursuant to any of the Loan Documents, including with respect to this Section, regardless of whether such matters are legal or equitable in nature or arise under tort or contract law.  
(b)Full Recourse Guaranty.  Notwithstanding anything to the contrary herein, Lender shall have full recourse to Guarantor and all of its assets, and Guarantor shall guaranty and be personally liable to Lender, for the full payment and performance of all Obligations of Borrower and the other Credit Parties with respect to the Loan (the “Full Recourse Obligations”; collectively with the Limited Obligations, the “Carveout Guaranty Obligations”), including payment of the entire amount of principal, accrued interest, and premiums due from time to time under the Loan and of all other Obligations of Borrower to Lender under or in respect of any of the Loan Documents, including reimbursements, late charges, interest and default interest (including post-petition interest to the extent a petition is filed by or against Borrower under the Bankruptcy Code), actual damages, indemnity obligations, actual and reasonable collection and court costs, actual and reasonable attorneys’ fees, advances, and all other actual expenses and charges of any kind, in each case whenever incurred and all without set-off, counterclaim, recoupment, or deduction of any amounts owing or alleged to be owing by Lender to any Credit Party, IF:
(i)A Prohibited Transaction occurs or is completed in violation of the Loan Documents; 

(ii)An Event of Default described in Section 6.1(f) of the Loan Agreement occurs with respect to any Credit Party;  
(iii)Any Credit Party commences any legal proceeding against Lender or any Lender Affiliate pursuant to which such Credit Party seeks to recover damages or other affirmative recovery against Lender or a Lender Affiliate, including any proceeding asserting claims based on any theory of lender liability; or
(iv)Either the Franchise Agreement or Management Agreement is terminated, surrendered or materially modified, in each case, without the prior written consent of Lender, in its sole discretion; or if any Credit Party that is a party thereto fails to materially comply with the terms of the Franchise Agreement and the Management Agreement and Borrower fails to take commercially reasonable steps to cure such material noncompliance to Lender’s satisfaction.   
Nothing herein shall be deemed to be a waiver of any right which Lender may have under Sections 506(a), 506(b), 1111(b) or any other provision of the United States Bankruptcy Code, as such sections may be amended, or corresponding or superseding sections of the Bankruptcy Amendments and Federal Judgeship Act of 1984, to file a claim in any relevant bankruptcy proceeding for the full amount due to Lender under the Loan Documents or to require that all Collateral shall continue to secure the amounts due under the Loan Documents.
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Notwithstanding the foregoing, the Full Recourse Obligations will not include any Excluded Rate Contract Obligation.
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2.Nature of Guaranty; Joint and Several Liability of Multiple Guarantors.  This Guaranty is an absolute and unconditional guaranty of payment and performance and not of collection.  Guarantor’s obligations under this Guaranty are primary and are independent of the obligations of any other Credit Party, and a separate action or actions may be brought and executed against any one or more of the Guarantors, whether or not such action is brought against such Credit Party and whether or not such Credit Party is joined in such action or actions.  If this Guaranty is signed by more than one Person, the liability of each such Guarantor is joint and several.   
3.Duration; Indemnification.  This Guaranty is effective when received by Lender and, except as may otherwise be specifically provided herein, shall continue in full force and effect until all of the Guaranteed Obligations are fully and finally paid and performed and Lender has no further obligation to make loans or otherwise extend credit to or for the benefit of Borrower.  The Guaranteed Obligations shall not be considered fully and finally paid and performed unless and until all payments by Borrower to Lender are no longer subject to any right on the part of any Person, including Borrower, Borrower as a debtor-in-possession, or any trustee in bankruptcy, to require Lender to disgorge such payments or to seek to recoup all or any portion of such payments.  Accordingly, this Guaranty shall continue to be effective or be reinstated, as applicable, if at any time the payment or performance of all or any portion of the Guaranteed Obligations is rescinded or reduced in amount or must otherwise be restored or returned by Lender, whether as a “voidable preference” or “fraudulent conveyance,” or under any federal or state law, including the Bankruptcy Code or otherwise, all as though such payment or performance had not been made, and Guarantor will indemnify, defend, and hold Lender and each of Lender’s Affiliates (each an “Indemnitee”) harmless for, from and against, any and all Liabilities incurred by Lender in connection with such rescission, reduction, return or restoration.  This Guaranty shall remain in full force and effect and continue to be effective if (a) any petition is filed by or against Guarantor or any other Credit Party for relief under the Bankruptcy Code; (b) Guarantor or any other Credit Party becomes insolvent or makes an assignment for the benefit of creditors; or (c) a receiver or trustee is appointed for all or any significant part of the assets of Guarantor or any other Credit Party.
4.Representations and Warranties.  Each Guarantor acknowledges and agrees that the representations and warranties in this Section are a material consideration to Lender; that Lender is relying on their correctness and completeness in entering into the Loan Agreement and the transactions contemplated by the Loan Documents and in  making the Loan(s); and that these representations and warranties are true and accurate as of the date hereof, will be true and accurate as of the Closing, as if made at Closing, and will survive the Closing, regardless of any investigation or inspection by Lender.  Additionally, Guarantor shall take, or cause to be taken, all such actions as may be necessary or appropriate to ensure that the representations and warranties in this Guaranty continue to be true and correct in all material respects.  Accordingly, each Guarantor represents, warrants, and certifies to and covenants with Lender that:

(a)Entity Status; Name and Business Address.  As to each Guarantor that is an entity:  (i) such Guarantor’s exact legal name is set forth on the signature page hereof: (ii) such Guarantor is a domestic U.S. entity, validly existing and in good standing under the laws of its formation state, is duly qualified and licensed to do business in the state where each Site is located, and has full power and authority to enter into and perform its obligations under this Guaranty; (iii) this Guaranty has been duly authorized and validly executed by such Guarantor; (iv) the individual(s) signing this Guaranty on behalf of such Guarantor are duly authorized to do so; (v) the entry into and performance by such Guarantor of this Guaranty does not and will not violate any provision of such Guarantor’s organizational documents.  Guarantor’s chief executive office and principal place of business is at the location set forth on the signature page hereof. 
(b)No Violations, Breaches, or Defaults.  The entry into and performance by Guarantor of this Guaranty does not and will not violate any judgment, order, law or regulation applicable to Guarantor or result in any breach of, constitute an event of default under, or result in the creation of any lien, charge, security interest or other encumbrance upon any Collateral pursuant to any indenture, mortgage, deed of trust, bank loan or credit agreement or other instrument to which Guarantor is a party or by which Guarantor’s assets are bound.
(c)Legal, Valid and Binding.  Upon execution by Guarantor of this Guaranty, the Guaranty shall constitute the legal, valid and binding obligation of Guarantor, enforceable against Guarantor in accordance with its respective terms, except as enforceability may be limited by applicable bankruptcy, insolvency, liquidation, reorganization and other laws affecting the rights of creditors generally and general principles of equity.
(d)Anti-Money Laundering; Anti-Terrorism.  Guarantor and its Affiliates (each, an “AML Party”) are  and will remain in material compliance with all: (i) U.S. economic sanctions laws and executive orders; (ii) regulations promulgated by the U.S. Office of Foreign Assets Control (“OFAC”); and (iii) applicable anti-money laundering and counter-terrorism provisions of the Bank Secrecy Act, the U.S. Patriot Act, and all rules and regulations issued pursuant to such laws, including those relating to “know your customer”, anti-money laundering, and anti-terrorism.  No AML Party is or will become a Person (A) included by OFAC on the list of Specially Designated Nationals and Blocked Persons (the “SDN List”) or who is otherwise the target of U.S. economic sanctions laws, such that, in either case, a U.S. Person cannot engage in business transactions with such Person; or (B) that is controlled by, or acting, directly or indirectly, for or on behalf of any Person on the SDN List or a foreign government that is the target of U.S. economic sanctions prohibitions, such that entry into or performance under any Loan Document would violate Applicable Law.  For purposes of this subsection, “Affiliate” does not include the equity owners of any entity that is publicly traded on a recognized national U.S. stock exchange.  Within five days of written request, Guarantor shall provide Lender with such documentation as Lender may request from time to time, to verify compliance with the terms and conditions of this subsection, including with respect to sources of funds for Payments made or to be made by Guarantor.
(e)Investigations and Litigation.  There is no action, suit, investigation, proceeding or arbitration at law or in equity, including condemnation proceedings or proceedings in lieu of condemnation, pending or, to Guarantor’s best knowledge, threatened against or affecting Guarantor or any of its assets or revenues or any of the Loan Documents or any of the transactions contemplated thereby.
(f)Solvency.  Both before and immediately after consummation of the transactions contemplated by the Loan Documents and after giving effect to such transactions, Guarantor is Solvent.
5.Waivers.  Guarantor unconditionally waives and agrees not to assert:  (a) any requirement that Lender first make demand upon, or seek to enforce or exhaust remedies against any other Credit Party or other Person or against any Collateral or property of any other Credit Party or other Person before demanding payment from Guarantor or seeking to enforce this Guaranty; (b) any rights, benefits and defenses which might otherwise be available to Guarantor pursuant to Arizona Revised Statutes §12-1641 through §12-1646, §12-1566, §33-725; §33-814, §44-141, §44-142; or §47-3605, or Arizona Rules of Civil Procedure Rule 17(e), or any other Applicable Law similar to the foregoing that might operate to limit (i) Guarantor’s or any other Credit Party’s liability under, or the enforcement of, this Guaranty and the other Loan Documents; or (ii) the right of Lender to recover a deficiency judgment, or to 

otherwise proceed, against Guarantor or any other Person obligated for the payment of the Guaranteed Obligations, after any foreclosure, trustee’s sale, or UCC sale, of any Collateral securing payment of the Guaranteed Obligations; (c) any statute of limitations affecting the obligations or liabilities under the Loan Documents of Guarantor or any other Credit Party; (d) diligence, presentment, protest, demand for performance, notice of nonperformance, notice of intent to accelerate, notice of acceleration, notice of protest, notice of dishonor, notice of extension, renewal, alteration or amendment, notice of acceptance of this Guaranty, notice of default under any of the Loan Documents, and all other notices whatsoever; and (e) any other claim or defense that otherwise would be available to Guarantor based on principles of suretyship or guarantee or otherwise governing obligations of persons secondarily liable thereon or because any of the Guaranteed Obligations are secured by a lien on real property. 
6.Effect of Certain Matters.  Guarantor’s obligations hereunder shall not be affected or impaired by reason of, and Guarantor waives any and all rights and defenses that Guarantor may otherwise have arising out of, any of the following:  (a) the modification (whether or not material) of any obligations of any other Credit Party under, or of any provisions of, any Loan Document, whether or not Guarantor joined in or consented to such modification; (b) Lender’s taking of or omission to take any action pursuant to any Loan Document, including granting any waiver, consent, or extension or any failure, omission, or delay by Lender to enforce any obligation, condition or other provision in any Loan Document or to assert or exercise any right, power or remedy conferred on Lender in any Loan Document; (c) the assignment to or assumption by any third party of any or all of the rights or obligations of any Credit Party under any Loan Document; (d) the release or discharge of any other Credit Party from the performance or observance of any obligation, undertaking or condition to be performed by such Credit Party under any Loan Document by operation of law or otherwise; (e) any action, inaction or election of remedies by Lender that results in any impairment or destruction of any subrogation, indemnification, reimbursement or contribution rights of Guarantor; (f) any setoff, defense, counterclaim, abatement, recoupment, reduction, change in Applicable Law or any other event or circumstance which might otherwise constitute a legal or equitable discharge or defense of a guarantor, indemnitor or surety under Applicable Law; (g) the termination or renewal of any Guaranteed Obligation; (h) the obtaining by Lender of any additional Collateral; the release or substitution by Lender of any Collateral; or the perfection or failure to perfect any liens or security interests with respect to any Collateral; (i) the use of any Loan proceeds, regardless of whether such use complies with the Loan Documents, with Lender having no duty to monitor the use or application of any Loan disbursement; or (j) any invalidity, irregularity or unenforceability in whole or in part of any Loan Document, or any limitation of the liability of any other Credit Party under the Loan Documents, including any claim that the Loan Documents were not duly authorized, executed, or delivered on behalf of any Credit Party.
7.Access to Credit Party Information.  Guarantor now has and will continue to have independent means of obtaining information concerning the affairs, financial condition and business of each other Credit Party.  Regardless of what information Lender may from time to time have, Lender shall have no obligation to provide to Guarantor any information concerning, or to monitor for the benefit of, Guarantor (a) the business operations of any Credit Party; (b) the performance by any Credit Party of, or the ability of any Credit Party to perform, such Credit Party’s obligations pursuant to the Loan Documents; or (b) any other matter.
8.Subordination.  All Indebtedness, together with all rights of subrogation, contribution, reimbursement, and indemnification, of any Credit Party to Guarantor, now or in the future (collectively, the “Intercompany Indebtedness”) is hereby subordinated to the Guaranteed Obligations.  Any such Intercompany Indebtedness, if Lender so requests, shall be collected, enforced and received by Guarantor as trustee for Lender and be paid over to Lender on account of the Guaranteed Obligations, but without reducing or affecting in any manner the liability of Guarantor under this Guaranty or any other Loan Document.
9.Waiver of Subrogation and Certain Other Rights.  To the extent permitted by Applicable Law, Guarantor waives any claim, defense, or other right which Guarantor may now have or hereafter acquire against any other Credit Party, or any other Person primarily or secondarily obligated with respect to any of the Guaranteed Obligations or the Collateral that arises from the existence or performance of the obligations of Guarantor under this Guaranty, including any right of subrogation, reimbursement, exoneration, contribution, indemnification or any right to participate in any claim or remedy of Lender against any other Credit Party or Person, or any property securing any of the Guaranteed Obligations which Lender now has or hereafter acquires, whether or not such claim, right or remedy arises in equity or under contract, statute or common law.

10.Completion.  Upon a Default or if Guarantor fails to satisfy all of the Completion Obligations and in addition to all other rights and remedies available to Lender under the Loan Documents or at law or in equity, Lender, at its sole option, may:  (a) cause the PIP (as defined in the Loan Agreement) to be completed in whole or in part; (b) exercise its rights and security interests with respect to all construction contracts, architect’s agreements, engineer’s agreements, permits, licenses and approvals and cause the general contractor, each construction contractor and other Person providing services, materials or labor in connection with the PIP to continue to perform their respective obligations; (c) hire such additional or replacement contractors, architects, engineers, or other Persons to undertake such completion on such terms and conditions as Lender may deem appropriate; and (d) make or approve such changes in the plans and specifications as Lender may determine are reasonably necessary in connection with the completion of the PIP.  Guarantor shall reimburse Lender immediately on demand (which demand may be made from time to time as the PIP is being constructed and completed) for all costs and expenses, including reasonable attorneys’ fees, that Lender may incur in connection with the construction and completion of the PIP, together with interest on those sums from and after the date(s) they are incurred at the Default Rate.  In addition, Lender may bring an action at law or in equity, or both, to compel Guarantor to perform the Completion Obligations and Lender shall be entitled to damages and compensation for the cost to complete the PIP and all other loss, costs, damage, injury and expense which may be sustained or incurred by Lender as a direct or indirect consequence of Guarantor’s failure to perform the Completion Obligations, including interest at the Default Rate.  Lender may from time to time bring such an action regardless of whether Lender has first required performance by Borrower, or whether Lender has exhausted any or all security for the Obligations.  GUARANTOR EXPRESSLY ACKNOWLEDGES THAT THE MEASURE OF LENDER’S DAMAGES FOR BREACH OF THE COMPLETION OBLIGATIONS SHALL BE BASED ON THE COST OF COMPLETING THE PIP AS SET FORTH ABOVE, NOT THE EXTENT TO WHICH COMPLETING THE PIP WOULD INCREASE THE VALUE OF THE PROPERTY. “Completion Obligations” means the construction and full and final completion of the PIP on or before the date required under the Franchise Agreement, in accordance with the PIP plans and specifications (modified as provided above), Applicable Law, and the terms, conditions, and requirements of the Loan Agreement and other Loan Documents, free and clear of all mechanic’s and materialmen’s Liens and free from defects, errors, or omissions.
11.Notices.  All Notices shall be given as provided in the Loan Agreement, if to Guarantor, at the address set forth below, and if to Lender, as provided in the Loan Agreement.
12.Commercial Transaction; No Advice.  Guarantor confirms, acknowledges and agrees that (a) this Guaranty is being executed and delivered in connection with a commercial business transaction; (b) none of the Loan proceeds is being or will be used by Guarantor or any other Person for any personal, family, or household purpose; and (c) Guarantor has not received any legal, tax, financial or accounting advice from Lender or any Affiliate of Lender.
13.Binding Effect.  This Guaranty is binding on Guarantor and its successors and assigns, and, if Guarantor is an individual, on such individual’s heirs, personal representatives, administrators, and executors, and including a debtor-in-possession on behalf of Guarantor, and shall inure to the benefit of Lender, its successors and assigns, including any Person obtaining any rights from Lender in a Lender Transfer.
14.Severability.  Any provision of this Guaranty being held illegal, invalid or unenforceable in any jurisdiction shall not affect any part of such provision not held illegal, invalid or unenforceable, any other provision of any Loan Document or any part of such provision in any other jurisdiction.
15.Remedies.  No delay on the part of Lender in the exercise of any right or remedy under this Guaranty shall operate as a waiver thereof.  No single or partial exercise by Lender of any right or remedy shall preclude other or further exercise thereof or the exercise of any other right or remedy.  No modification or waiver of any of the provisions of this Guaranty shall be binding upon Lender except as set forth in a writing executed by Lender.
16.Limitation of Liability for Certain Damages.  In no event shall Lender, any Credit Party, or any Affiliate of Lender or any Credit Party be liable to any Person on any theory of liability for any special, indirect, consequential or punitive damages (including any loss of profits, business or anticipated savings).  Each of Lender and each Credit Party hereby waives, releases and agrees (and shall cause each its respective Affiliates to waive, release and agree) not to sue upon any such claim for any special, indirect, consequential or punitive damages, whether or not accrued and whether or not known or suspected to exist in its favor; provided, however, that nothing herein 

shall be deemed a waiver of Lender’s rights to sue upon or otherwise recover on all amounts due Lender under the Loan Documents, including with respect to the Obligations and Guaranteed Obligations.  
17.Governing Law.  THE LAWS OF THE STATE OF ARIZONA (WITHOUT GIVING EFFECT TO ITS CONFLICTS OF LAWS PRINCIPLES) SHALL GOVERN ALL MATTERS ARISING OUT OF, IN CONNECTION WITH OR RELATING TO THIS GUARANTY, INCLUDING ITS VALIDITY, INTERPRETATION, CONSTRUCTION, PERFORMANCE AND ENFORCEMENT.
18.Jurisdiction and Service of Process.  Any legal action or proceeding with respect to this Guaranty shall be brought exclusively in the courts of the State of Arizona located in Maricopa County or of the United States for the District of Arizona, sitting in Phoenix, Arizona, and Guarantor accepts for itself and in respect of its property, generally and unconditionally, the jurisdiction of the aforesaid courts; provided, however, that nothing in this Guaranty shall limit or restrict Lender’s right to commence any proceeding in the federal or state courts located in the state in which a particular Site is located to the extent Lender deems such proceeding necessary or advisable to exercise remedies available under any Loan Document.  Lender and Guarantor hereby irrevocably waive any objection, including any objection to the laying of venue or based on the grounds of forum non conveniens, that either of them may now or hereafter have to the bringing of any such action or proceeding in such jurisdictions.  Guarantor hereby (a) irrevocably waives personal service of any and all legal process, summons, notices and other documents of any kind; (b) consents to such service in any suit, action or proceeding brought in the United States by any means permitted by Applicable Law, including by the mailing thereof to Guarantor’s address specified on the signature page hereto; and (c) agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Applicable Law.
19.Waiver of Jury Trial.  LENDER AND GUARANTOR, TO THE FULLEST EXTENT PERMITTED BY LAW, WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING ARISING OUT OF, IN CONNECTION WITH OR RELATING TO, THIS GUARANTY, THE OTHER LOAN DOCUMENTS AND ANY OTHER TRANSACTION CONTEMPLATED HEREBY AND THEREBY.  THIS WAIVER APPLIES TO ANY ACTION, SUIT OR PROCEEDING WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE. 
20.Agreement to Credit Party Provisions.  Guarantor has received and reviewed a copy of the Loan Agreement and each of the other Loan Documents.  Guarantor agrees that the provisions of the Article in the Loan Agreement titled “General Provisions” apply to this Guaranty, the same as if such provisions were set forth in full in this guaranty.  Furthermore, Guarantor Assumes and agrees to be bound by and to perform all of the terms, conditions, and obligations contained in the Loan Agreement and in any Other loan document that are stated to be applicable to, or otherwise apply to, Guarantors OR Credit Parties.  Guarantor acknowledges and agrees that Guarantor is a Credit Party.
21.Authorization.  Guarantor hereby authorizes Guarantor’s banks, creditors, and suppliers to disclose and release to Lender, its affiliates, and their respective officers, employees, attorneys, agents, representatives and advisers (collectively, the “Lender Parties”) all credit and financial information that any of the Lender Parties may request relating to Guarantor and Guarantor’s business.  Guarantor also authorizes each of the Lender Parties to: (a) perform background, credit, judgment, lien and other checks, searches, inspections, and investigations and to obtain personal and business credit and asset reports with respect to Guarantor and Guarantor’s business, all as the Lender Parties deem appropriate in their sole judgment; (b) share the results thereof, as well as any other information provided to them from time to time by or on behalf of Guarantor, among themselves, with insurance companies and title companies, and as otherwise required by law; (c) answer questions about their credit experience with Guarantor; and (d) retain the information provided to them in connection with the transactions contemplated by the Loan Documents.
22.Entire Agreement.  This Guaranty embodies the entire agreement of the parties and supersedes all prior agreements and understandings, oral or written, relating to the subject matter hereof.  Guarantor acknowledges and affirms that Guarantor did not rely on any statement, oral or written, not contained in this Guaranty or the other Loan Documents in making Guarantor’s decisions to enter into this Guaranty.

[SIGNATURE PAGE FOLLOWS]
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EXECUTED effective as of the date first set forth above.
GUARANTOR:
LODGING FUND REIT III OP, LP, a Delaware limited partnership
		By:
	Lodging Fund REIT III, Inc., a Maryland corporation, its General Partner

		By:
	/s/ Samuel C. Montgomery

		Name:
	Samuel C. Montgomery

		Its:
	Chief Financial Officer

Address for Notices:
c/o Legendary Capital 
1635 43rd St. S., Suite 205
Fargo, ND 58103​
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WHEN RECORDED, RETURN TO:‌
Snell & Wilmer L.L.P.
One Arizona Center
400 East Van Buren
Phoenix, Arizona 85004-2202
Attention:  Cynthia Lundstrom
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OPERATING LEASE SUBORDINATION AND ATTORNMENT AGREEMENT
THIS OPERATING LEASE SUBORDINATION AND ATTORNMENT AGREEMENT (this “Agreement”) is made and entered into as of May 13, 2022, by and among LF3 EL PASO AIRPORT TRS, LLC, a Delaware limited liability company, whose mailing address is 1635 43rd St. S., Suite 205, Fargo, ND 58103 (“Operating Lessee”), as grantor, LF3 EL PASO AIRPORT, LLC, a Delaware limited liability company, whose mailing address is 1635 43rd St. S., Suite 205, Fargo, ND 58103 (“Owner” and collectively, along with Operating Lessee, the “Borrower” or “Grantor”), as grantor, and WESTERN ALLIANCE BANK, an Arizona corporation, whose mailing address is One East Washington Street, 25th Floor, Phoenix, AZ 85004, Attention: Hotel Franchise Finance (“Lender” or “Grantee”), as grantee.  
WHEREAS, pursuant to that certain Loan Agreement, dated as of even date herewith (the “Loan Agreement”), by and between Lender and Borrower, Lender made certain loans (collectively, the “Loan”), to Borrower and is secured by, among other things, that certain Deed of Trust, Security Agreement, Assignment of Leases and Rents, Financing Statement, and Fixture Filing, dated as of even date herewith, executed by Owner for the benefit of Lender (as same may hereafter be amended, modified, recast or extended, the “Deed of Trust”), which Deed of Trust encumbers real property described on Exhibit A attached hereto and made a part hereof for all purposes (the “Premises”), and improvements thereon.  The Loan Agreement, Deed of Trust, and any other documents executed in connection with the Loan are collectively referred to herein as the “Loan Documents”.  Capitalized terms used but not defined herein will have the meanings provided in the Loan Agreement; 
WHEREAS, Owner and Operating Lessee have entered that certain Lease Agreement dated February 8, 2022 (the “Operating Lease”), pursuant to which Owner leases and grants to Operating Lessee a leasehold estate in the Premises and improvements thereon;
WHEREAS, the Deed of Trust is to remain prior in lien to the estate created by the Operating Lease and prior to all right, title and interests of the Operating Lessee thereto and thereunder; and
WHEREAS, in order to induce Lender to enter into the Loan Agreement, Owner and the Operating Lessee have agreed to execute and deliver this Agreement to Lender.
NOW, THEREFORE, in consideration of the premises, the mutual covenants of the parties hereto, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto do mutually covenant and agree as follows:
1.Subordination.  The Operating Lease is and shall at all times hereafter be subject and subordinate in all respects to the liens, terms and provisions of the Deed of Trust and the other Loan Documents and to all increases, amendments, renewals, modifications, substitutions, consolidations and extensions thereof, and to all other future 

mortgages, deeds of trusts and similar instruments held by Lender encumbering the Premises.  Without limiting the foregoing subordination, Operating Lessee acknowledges and agrees that all right, title and interest of Operating Lessee in and to the Premises is held subject to the Deed of Trust, and Operating Lessee does hereby grant, assign and pledge to Lender all of Operating Lessee’s right, title and interest (to the extent that such right, title and interest is established and exists under the terms of the Operating Lease) in and to the Premises and all of the other property and interests described in the Deed of Trust as security for the payment and performance of all of the obligations secured by the Deed of Trust.
2.No Obligation on Lender’s Part.  Lender is not and shall not become obligated to Operating Lessee for the performance of any of the terms, covenants, conditions and agreements of Owner under the Operating Lease until such time as Lender acquires title to the Premises.
3.Operating Lessee's Compliance with Certain Provisions of Loan Documents.  The Operating Lessee agrees that (i) all insurance maintained for the Premises and improvements thereon must satisfy all requirements for such insurance set forth in the Loan Documents, including that Lender shall be named as a beneficiary and additional insured or loss payee, as the case may be, thereon, and (ii) all insurance proceeds and condemnation awards (and settlements in lieu thereof) relating to the Premises shall, notwithstanding any term or provision contained in the Operating Lease to the contrary, be paid and applied as provided in the Loan Documents and the Operating Lessee waives all rights and claims in, to and under such proceeds and awards.   
4.Further Assurances.  The Operating Lessee agrees to promptly execute such other documents as Lender may deem reasonably necessary to further document or evidence the full subordination of the Operating Lease to the liens, terms and provisions of the Deed of Trust and the other Loan Documents.
5.Successors and Assigns.  This Agreement shall be binding upon and inure to the parties, their respective heirs, legal representatives, successors and assigns.  
6.Governing Law.  This Agreement shall be construed in accordance with the laws of the State of Arizona.  
7.No Oral Modification.  This Agreement may not be changed, amended or modified in any manner other than by an agreement in writing specifically referring to this Agreement and executed by the parties hereto.
8.Effect of Certain Matters.  The subordination of the Operating Lease, and Operating Lessee’s obligations hereunder, shall not be affected or impaired by reason of, and Operating Lessee waives any and all rights and defenses that Operating Lessee may otherwise have arising out of, any of the following:  (a) the modification (whether or not material) of any obligations of any other Credit Party under, or of any provisions of, any Loan Document, whether or not Operating Lessee joined in or consented to such modification; (b) Lender’s taking of or omission to take any action pursuant to any Loan Document, including granting any waiver, consent, or extension or any failure, omission, or delay by Lender to enforce any obligation, condition or other provision in any Loan Document, or to assert or exercise any right, power or remedy conferred on Lender in any Loan Document; (c) the assignment to or assumption by any third party of any or all of the rights or obligations of any Credit Party under any Loan Document; (d) the release or discharge of any other Credit Party from the performance or observance of any obligation, undertaking or condition to be performed by such Credit Party under any Loan Document by operation of law or otherwise; (e) any action, inaction or election of remedies by Lender that results in any impairment or destruction of any subrogation, indemnification, reimbursement or contribution rights of Operating Lessee; (f) any setoff, defense, counterclaim, abatement, recoupment, reduction, change in Applicable Law or any other event or circumstance which might otherwise constitute a legal or equitable discharge or defense of a debtor, indemnitor or surety under Applicable Law; (g) the amendment, termination or renewal of any of the Obligations; (h) the obtaining by Lender of any additional Collateral; the release or substitution by Lender of any Collateral; or the perfection or failure to perfect any liens or security interests with respect to any Collateral; (i) the use of any Loan proceeds, regardless of whether such use complies with the Loan Documents, with Lender having no duty to monitor the use or application of any Loan disbursement; or (j) any invalidity, irregularity or unenforceability in whole or in part of any Loan Document, or any limitation of the liability of any other Credit Party under the Loan 

Documents, including any claim that the Loan Documents were not duly authorized, executed, or delivered on behalf of any Credit Party.
9.Rule of Construction.  This Agreement shall not be construed more strictly against one party than against the other, merely by virtue of the fact that it may have been prepared by counsel for one of the parties, it being recognized that all parties hereto have contributed substantially and materially to the preparation of this Agreement.
10.No Waiver.  Neither the failure nor the delay by Lender to exercise any right, power or privilege under the Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or privilege preclude any other or further exercise of any other right, power or privilege.
11.Counterparts.  This Agreement may be executed in counterparts, each of which may be executed by one of the parties hereto, but all of which, when taken together, shall constitute a single agreement.
12.Severability.  If any provision of this Agreement or any section, paragraph, sentence, clause, phrase or word or the application of any of the foregoing, in any circumstances, is adjudicated to be invalid, the validity of the remainder of this Agreement shall be construed as if such invalid part were never included herein.
13.Headings.  Etc.  The captions and headings used herein are for purposes of reference only and are not to be construed as confining or limiting in any way the scope or intent of the provisions hereof.  Whenever the context requires or permits, the singular shall include the plural, the plural shall include the singular, and the masculine, feminine and neuter shall be freely interchangeable.
14.Waiver of Jury Trial.  LENDER, OWNER AND OPERATING LESSEE, TO THE MAXIMUM EXTENT PERMITTED BY LAW, WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING ARISING OUT OF, IN CONNECTION WITH OR RELATING TO, THIS AGREEMENT, THE OTHER LOAN DOCUMENTS AND ANY OTHER TRANSACTION CONTEMPLATED HEREBY AND THEREBY.  THIS WAIVER APPLIES TO ANY ACTION, SUIT OR PROCEEDING WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE.
15.Termination.  This Agreement shall automatically terminate upon all of the Obligations under the Loan Documents being indefeasibly paid and performed in full, and Lender having no further obligation to make loans or otherwise extend credit to or for the benefit of Borrower.  The Obligations shall not be considered fully and finally paid and performed unless and until all payments by Borrower to Lender are no longer subject to any right on the part of any person, including Borrower, Borrower as a debtor-in-possession, or any trustee in bankruptcy, to require Lender to disgorge such payments or to seek to recoup all or any portion of such payments.  
​
[SIGNATURE PAGES FOLLOW]
​

IN WITNESS WHEREOF, the parties hereto have executed this Operating Lease Subordination and Attornment Agreement as of the day and year first above written.  
OPERATING LESSEE:
LF3 EL PASO AIRPORT TRS, LLC, a Delaware limited liability company
		By:
	Lodging Fund REIT III TRS, Inc., a Delaware corporation, its Sole Member

By: Lodging Fund REIT III OP, LP, a Delaware limited partnership, its Sole Shareholder 
​
By: Lodging Fund REIT III, Inc., a Maryland corporation, its General Partner
​
By: _/s/ Samuel C. Montgomery________
Name: Samuel C. Montgomery
Its: Chief Financial Officer 
​
STATE OF _North Dakota_____)
)  ss.:
COUNTY OF _Cass______)
On the _11__ day of _May__, in the year 2022 before me, the undersigned, personally appeared Samuel C. Montgomery, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual or the person on behalf of which the individual acted, executed the instrument. 
/s/ Jennifer Moum​ ​​ ​​ ​​ ​
Notary Public
My commission expires: April 25, 2026
​

OWNER:
LF3 EL PASO AIRPORT, LLC, a Delaware limited liability company
		By:
	Lodging Fund REIT III OP, LP, a Delaware limited partnership, its Sole Member

		By:
	Lodging Fund REIT III, Inc., a Maryland corporation, its General Partner

By:​ ​/s/ Samuel C. Montgomery​ ​
Name:Samuel C. Montgomery
Its:Chief Financial Officer
​
​
​
STATE OF _North Dakota_____)
)  ss.:
COUNTY OF _Cass______)
On the _11__ day of _May__, in the year 2022 before me, the undersigned, personally appeared Samuel C. Montgomery, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity, and that by his signature on the instrument, the individual or the person on behalf of which the individual acted, executed the instrument. 
/s/ Jennifer Moum​ ​​ ​​ ​​ ​
Notary Public
My commission expires: April 25, 2026
​

LENDER:
WESTERN ALLIANCE BANK, an Arizona corporation
​
By:​ ​/s/ Erik Siersma​ ​
Printed Name:​ ​Erik Siersma​ ​
Its: ​ ​Vice President​ ​​ ​​ ​​ ​​ ​
​
​
​
	STATE OF ARIZONA
	)

) ss.
County of Maricopa)
The foregoing instrument was acknowledged before me this _11_ day of __May____, 2022, by __Erik Siersma______, the ​ ​Vice President​ ​​ ​​ ​​ ​​ ​ of Western Alliance Bank, an Arizona corporation, on behalf of the corporation.
​
/s/ Debi Falenski​ ​
Notary Public
My Commission Expires:
​ ​1-5-2024​ ​​ ​
​
​

EXHIBIT A
DESCRIPTION OF PREMISES
PARCEL 1:
​
LOT 1, BLOCK 1, INTERNATIONAL INDUSTRIAL CENTER UNIT 1, REPLAT B, AN ADDITION TO THE CITY OF EL PASO, EL PASO COUNTY, TEXAS, ACCORDING TO THE PLAT THEREOF ON FILE UNDER COUNTY CLERK'S FILE NO. 20150084213, OFFICIAL PUBLIC RECORDS, EL PASO COUNTY, TEXAS.
​
PARCEL 2:
​
NON-EXCLUSIVE EASEMENT TO A PORTION OF LOT 5, BLOCK 1, INTERNATIONAL INDUSTRIAL CENTER (REPLAT), AN ADDITION TO THE CITY OF EL PASO, EL PASO COUNTY, TEXAS, ACCORDING TO THE PLAT THEREOF ON FILE IN VOLUME 18, PAGE 54, PLAT RECORDS, EL PASO COUNTY, TEXAS, AND A PORTION OF LOT 1, BLOCK 1, INTERNATIONAL INDUSTRIAL CENTER UNIT 1, REPLAT B, AN ADDITION TO THE CITY OF EL PASO, EL PASO COUNTY, TEXAS, ACCORDING TO THE PLAT THEREOF ON FILE UNDER CLERK'S FILE NO. 20150084213, REAL PROPERTY RECORDS, EL PASO COUNTY, TEXAS, AS CREATED AND DESCRIBED IN THAT CERTAIN RECIPROCAL ACCESS AND EASEMENT AGREEMENT BY AND BETWEEN CRAWFORD PROPERTIES, LTD AND CP MESA, LTD, DATED MAY 15, 2001, RECORDED IN VOLUME 3997, PAGE 1414, REAL PROPERTY RECORDS, EL PASO COUNTY, TEXAS.

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