Common use of Capital Expenditures and Reserves Clause in Contracts

Capital Expenditures and Reserves. Lessor agrees to establish a reserve account together with all interest earned thereon for each Facility (the "Capital Expenditure Reserve Account") to fund Capital Expenditures in an amount equal to five percent (5%) of annual Room Revenues from each Facility (or such greater amount necessary to fund capital improvements required to comply with applicable Legal Requirements or any requirements imposed by the franchisor in accordance with the Franchise Agreement or necessary to maintain the safety or structural soundness of the Leased Property), net of amounts actually expended for Capital Expenditures for such Facility during any Fiscal Year. Any funds escrowed pursuant to a Franchise Agreement or Mortgage and designated for Capital Expenditures shall be deemed to be part of the Capital Expenditure Reserve Account for the applicable Leased Property. Any funds escrowed pursuant to a Mortgage may be pledged as security for such Mortgage, which pledge may provide that, in the event of a default by Lessor under the Mortgage, the escrowed funds may be applied to the balance of the loan secured by the Mortgage; provided, however, that in the event the holder of the Mortgage exercises such remedy, Lessor shall be obligated immediately to deposit into the Capital Expenditure Reserve Account any amount which may then be necessary to bring the funds in such account (together with any funds remaining in any other accounts of Lessor dedicated for such purpose) up to the aggregate level required by this Article XXXIX . Lessor shall make such proceeds available for Capital Expenditures on the same terms and conditions set forth in such Mortgage provided the same are comparable to the terms of this Lease. The Capital Expenditure Reserve Account for each Facility may be commingled by Lessor with similar accounts of Lessor with respect to other hotel properties leased by Lessor to Lessee. The Capital Expenditures disbursed for a particular Facility shall be made pursuant to a Capital Budget and such expenditures may be more or less than the five percent (5%) of annual Room Revenues reserved by Lessor for such Facility in the Capital Expenditure Reserve Account. Upon request by Lessee not more frequently than twice a year, Lessor shall provide Lessee a written report stating the amounts held in such Capital Expenditure Reserve Account with respect to each Leased Property and amounts disbursed out of said account with respect to each Leased Property during the prior Fiscal Year. Upon written request by Lessee to Lessor stating the specific use to be made and the reasonable approval thereof by Lessor, the funds in the Capital Expenditure Reserve Account shall be made available by Lessor for use by Lessee for Capital Expenditures in connection with the Primary Intended Use; provided, however, that no amounts made available under this Article shall be used to purchase property (other than "real property" within the meaning of Treasury Regulations Section 1.856-3(d)), to the extent that doing so would cause the Lessor to recognize income other than "rents from real property" as defined in Section 856(d) of the Code. All amounts in the Capital Expenditure Reserve Account are the property of Lessor. Lessee shall have no interest in the Capital Expenditure Reserve Account other than with respect to the funding of amounts in a Capital Budget approved by Lessor. ARTICLE XL

Capital Expenditures and Reserves. Lessor agrees to establish a reserve account together with all interest earned thereon for each Facility (the "Capital Expenditure Reserve Account") to fund Capital Expenditures in an amount equal to five four percent (54%) of annual Room Revenues from each Facility (or such greater amount necessary to fund capital improvements required to comply with applicable Legal Requirements or any requirements imposed by the franchisor in accordance with the Franchise Agreement or necessary to maintain the safety or structural soundness of the Leased Property)Facility, net of amounts actually expended for Capital Expenditures for such Facility during any Fiscal Year. Any funds escrowed pursuant to a Franchise Agreement or Mortgage and designated for Capital Expenditures shall be deemed to be part of the Capital Expenditure Reserve Account for the applicable Leased Property. Any funds escrowed pursuant to a Mortgage may be pledged as security for such Mortgage, which pledge may provide that, in the event of a default by Lessor under the Mortgage, the escrowed funds may be applied to the balance of the loan secured by the Mortgage; provided, however, that in the event the holder of the Mortgage exercises such remedy, Lessor shall be obligated immediately to deposit into the Capital Expenditure Reserve Account any amount which may then be necessary to bring the funds in such account (together with any funds remaining in any other accounts of Lessor dedicated for such purpose) up to the aggregate level required by this Article XXXIX . Lessor shall make such proceeds available for Capital Expenditures on the same terms and conditions set forth in such Mortgage provided the same are comparable to the terms of this LeaseXXXIX. The Capital Expenditure Reserve Account for each Facility may be commingled by Lessor with similar accounts of Lessor with respect to other hotel properties leased by Lessor to Lessee. The Capital Expenditures disbursed for a particular Facility shall be made pursuant to a Capital Budget and such expenditures may be more or less than the five percent (5%) of annual Room Revenues reserved by Lessor for such Facility in the Capital Expenditure Reserve Account. Upon request by Lessee not more frequently than twice a year, Lessor shall provide Lessee a written report stating the amounts held in such Capital Expenditure Reserve Account with respect to each Leased Property and amounts disbursed out of said account with respect to each Leased Property during the prior Fiscal Year. Upon written request by Lessee to Lessor stating the specific use to be made and the reasonable approval thereof by Lessor, the funds in the Capital Expenditure Reserve Account shall be made available by Lessor for use by Lessee for Capital Expenditures in connection with the Primary Intended UseUse as set forth in the approved Capital Budget; provided, however, that no amounts made available under this Article shall be used to purchase property proerty (other than "real property" within the meaning of Treasury Regulations Section 1.856-3(d)), to the extent that doing so would cause the Lessor to recognize income other than "rents from real property" as defined in Section 856(d) of the Code. Lessor's obligation to fund the Capital Expenditure Reserve Account shall be cumulative and any Capital Expenditures with respect to a Facility made in a Fiscal Year (including Fiscal Years preceding the Term of this Lease) in excess of four percent (4%) of Gross Revenues on a cumulative basis shall be credited to the Capital Expenditure Reserve Account for that Facility. All amounts in the Capital Expenditure Reserve Account are the property of Lessor. Lessee shall have no interest in the Capital Expenditure Reserve Account other than with respect to the funding of amounts in a Capital Budget approved by Lessor. ARTICLE XL.

Capital Expenditures and Reserves. Lessor agrees to establish a reserve account together with all interest earned thereon for each Facility Leased Property (the "Capital Expenditure Reserve Account") to fund Capital Expenditures in an amount equal to five percent (5%) of annual Room Revenues from each Facility such Leased Property (or such greater amount necessary to fund capital improvements required to comply with this Master Lease, including applicable Legal Requirements or any requirements imposed by the franchisor in accordance with this Master Lease, including the Franchise Agreement or necessary to maintain the safety or structural soundness of the such Leased Property), net of amounts actually expended for Capital Expenditures for such Facility Leased Property during any Fiscal Year. Any funds escrowed pursuant to a Franchise Agreement or Mortgage and designated for Capital Expenditures shall be deemed to be part of the Capital Expenditure Reserve Account for the applicable Leased Property. Any funds escrowed pursuant to a Mortgage may be pledged as security for such Mortgage, which pledge may provide that, in the event of a default by Lessor under the Mortgage, the escrowed funds may be applied to the balance of the loan secured by the Mortgage; provided, however, that in the event the holder of the Mortgage exercises such remedy, Lessor shall be obligated immediately to deposit into the Capital Expenditure Reserve Account any amount which may then be necessary to bring the funds in such account (together with any funds remaining in any other accounts of Lessor dedicated for such purpose) up to the aggregate level required by this Article XXXIX XXXVIII. Lessor shall make such proceeds available for Capital Expenditures on the same terms and conditions set forth in such Mortgage provided the same are comparable to the terms of this Master Lease. The Capital Expenditure Reserve Account for each Facility a Leased Property may be commingled by Lessor with similar accounts of Lessor with respect to other hotel properties leased by Lessor to lessees other than Lessee. The Capital Expenditures disbursed for a particular Facility Leased Property shall be made pursuant to a Capital Budget and such expenditures may be more or less than the five percent (5%) of annual Room Revenues reserved by Lessor for such Facility the Leased Property in the Capital Expenditure Reserve Account. Upon request by Lessee not more frequently than twice a year, Lessor shall provide Lessee a written report stating the amounts held in such Capital Expenditure Reserve Account with respect to each the Leased Property and amounts disbursed out of said account with respect to each the Leased Property during the prior Fiscal Year. Upon written request by Lessee to Lessor stating the specific use to be made and the reasonable approval thereof by Lessor (which may be evidenced by Lessor's approval of the Capital Budget), the funds in the Capital Expenditure Reserve Account shall be made available by Lessor for use by Lessee for Capital Expenditures in connection with the Primary Intended Use; provided, however, that no amounts made available under this Article shall be used to purchase property (other than "real property" within the meaning of Treasury Regulations Section 1.856-3(d)), to the extent that doing so would cause the Lessor to recognize income other than "rents from real property" as defined in Section 856(d) of the Code. Lessor's obligation to fund the Capital Expenditure Reserve Account shall be cumulative and any Capital Expenditures with respect to a Leased Property made in a Fiscal Year in excess of five percent (5%) of Gross Revenues on a cumulative basis shall be credited to the Capital Expenditure Reserve Account for the Leased Property. All amounts in the Capital Expenditure Reserve Account are the property of Lessor. Lessee shall have no interest in the Capital Expenditure Reserve Account other than with respect to the funding of amounts in a Capital Budget approved by Lessor. ARTICLE XL.

Capital Expenditures and Reserves. Lessor agrees to establish a reserve account together with all interest earned thereon for each the Facility (the "Capital Expenditure Reserve Account") to fund Capital Expenditures in an amount equal to five four percent (54%) of annual Room Revenues from each Facility (or such greater amount necessary to fund capital improvements required to comply with applicable Legal Requirements or any requirements imposed by the franchisor in accordance with the Franchise Agreement or necessary to maintain the safety or structural soundness of the Leased Property)Facility, net of amounts actually expended for Capital Expenditures for such the Facility during any Fiscal Year. Any funds escrowed pursuant to a Franchise Agreement or Mortgage and designated for Capital Expenditures shall be deemed to be part of the Capital Expenditure Reserve Account for the applicable Leased Property. Any funds escrowed pursuant to a Mortgage may be pledged as security for such Mortgage, which pledge may provide that, in the event of a default by Lessor under the Mortgage, the escrowed funds may be applied to the balance of the loan secured by the Mortgage; provided, however, that in the event the holder of the Mortgage exercises such remedy, Lessor shall be obligated immediately to deposit into the Capital Expenditure Reserve Account any amount which may then be necessary to bring the funds in such account (together with any funds remaining in any other accounts of Lessor dedicated for such purpose) up to the aggregate level required by this Article XXXIX . Lessor shall make such proceeds available for Capital Expenditures on the same terms and conditions set forth in such Mortgage provided the same are comparable to the terms of this LeaseXXXIX. The Capital Expenditure Reserve Account for each the Facility may be commingled by Lessor with similar accounts of Lessor with respect to other hotel properties leased by Lessor to Lessee. The Capital Expenditures disbursed for a particular Facility shall be made pursuant to a Capital Budget and such expenditures may be more or less than the five percent (5%) of annual Room Revenues reserved by Lessor for such Facility in the Capital Expenditure Reserve Account. Upon request by Lessee not more frequently than twice a year, Lessor shall provide Lessee a written report stating the amounts held in such Capital Expenditure Reserve Account with respect to each the Leased Property and amounts disbursed out of said account with respect to each the Leased Property during the prior Fiscal Year. Upon written request by Lessee to Lessor stating the specific use to be made and the reasonable approval thereof by Lessor, the funds in the Capital Expenditure Reserve Account shall be made available by Lessor for use by Lessee for Capital Expenditures in connection with the Primary Intended UseUse as set forth in the approved Capital Budget; provided, however, that no amounts made available under this Article shall be used to purchase property (other than "real property" within the meaning of Treasury Regulations Section 1.856-3(d)), to the extent that doing so would cause the Lessor to recognize income other than "rents from real property" as defined in Section 856(d) of the Code. Lessor's obligation to fund the Capital Expenditure Reserve Account shall be cumulative and any Capital Expenditures with respect to the Facility made by Lessor or an Affiliate of Lessor during its period of ownership of the Leased Property in excess of four percent (4%) of Gross Revenues on a cumulative basis shall be credited to the Capital Expenditure Reserve Account for the Facility. All amounts in the Capital Expenditure Reserve Account are the property of Lessor. Lessee shall have no interest in the Capital Expenditure Reserve Account other than with respect to the funding of amounts in a Capital Budget approved by Lessor. ARTICLE XL

Capital Expenditures and Reserves. (A) Subject to the last sentence of this subparagraph (A), not later than October 31 of each Fiscal Year, Lessee shall submit to Lessor agrees for Lessor's approval pursuant to establish the provisions of Section 3.3 hereof, a reserve Capital Expenditure Budget for the next Fiscal Year as part of Lessee's submission to Lessor of the Annual Budget. The purpose for the Capital Expenditure Budget shall be to keep the Leased Property competitive with any hotel or hotels similar in nature and type to the Leased Property in the area and to keep the Leased Property in compliance with the applicable provisions of the Franchise Agreement. The Capital Expenditure Budget shall include without limitation, the expenditures required, necessary and/or anticipated for the repair, replacement or refurbishment of carpet, soft goods, FF&E and structural and mechanical items, alterations to the Leased Property (but only in accordance with Section 10.1 hereof), reconstruction in the event of damages or destruction of the Leased Property (but only in accordance with Section 14 hereof), restoration pursuant to a Taking (but only in accordance with Section 15 of this Lease), other required or desirable capital improvements to the Leased Property or any of the components, other required or desired working capital, and such other items characterized as capital expenditures under the Uniform System (excluding, however, items required to be maintained at Lessor's cost pursuant to Section 9.1.2 of this Lease). Lessor shall maintain a separate interest bearing account together with all interest earned thereon for each Facility (referred to as the "Capital Expenditure Reserve Account"Account from which all costs and expenses reflected in an approved Capital Expenditure Budget should be paid; provided, however, Lessee shall be an authorized signatory on such account. Lessor shall, on or before the Commencement Date, fund into the Capital Expenditure Reserve Account (or if required by its mortgagee, into a similar account designated by such mortgagee) an amount equal to at least one hundred percent (100%) of the deferred maintenance costs relating to the Leased Property and required by Super 8 Motels, Inc., the engineering report prepared by Xxxxx & Xxxxxx, and/or Lessor's mortgagee. Lessee will contract for and cause the completion of any such deferred maintenance work within either six (6) months or one (1) year after the date hereof, as designated on a case by case basis by Lessor. Lessor shall also, within five (5) days of its receipt of the monthly profit and loss statement described in Section 25 (b)(3) hereof, fund into the Capital Expenditures in Expenditure Reserve Account (or if required by its mortgagee, into a similar account designated by such mortgagee), an amount equal to five percent (5%) of annual Room Revenues from each Facility (or such greater amount necessary to fund capital improvements required to comply with applicable Legal Requirements or any requirements imposed by the franchisor in accordance with the Franchise Agreement or necessary to maintain the safety or structural soundness of the Leased Property), net of amounts actually expended for Capital Expenditures for such Facility during any Fiscal Year. Any funds escrowed pursuant to a Franchise Agreement or Mortgage and designated for Capital Expenditures shall be deemed to be part of the Capital Expenditure Reserve Account for the applicable Leased Property. Any funds escrowed pursuant to a Mortgage may be pledged as security for such Mortgage, which pledge may provide that, in the event of a default by Lessor under the Mortgage, the escrowed funds may be applied to the balance of the loan secured by the Mortgage; provided, however, that in the event the holder of the Mortgage exercises such remedy, Lessor shall be obligated immediately to deposit into the Capital Expenditure Reserve Account any amount which may then be necessary to bring the funds in such account (together with any funds remaining in any other accounts of Lessor dedicated for such purpose) up to the aggregate level required by this Article XXXIX . Lessor shall make such proceeds available for Capital Expenditures on the same terms and conditions set forth in such Mortgage provided the same are comparable to the terms of this Lease. The Capital Expenditure Reserve Account for each Facility may be commingled by Lessor with similar accounts of Lessor with respect to other hotel properties leased by Lessor to Lessee. The Capital Expenditures disbursed for a particular Facility shall be made pursuant to a Capital Budget and such expenditures may be more or less than the five percent (5%) of annual Room Revenues reserved by Lessor for such Facility in the Capital Expenditure Reserve Account. Upon request by Lessee not more frequently than twice a year, Lessor shall provide Lessee a written report stating the amounts held in such Capital Expenditure Reserve Account with respect to each Leased Property and amounts disbursed out of said account with respect to each Leased Property during the prior Fiscal Year. Upon written request by Lessee to Lessor stating the specific use to be made and the reasonable approval thereof by Lessor, the funds in the Capital Expenditure Reserve Account shall be made available by Lessor for use by Lessee for Capital Expenditures in connection with the Primary Intended Use; provided, however, that no amounts made available under this Article shall be used to purchase property (other than "real property" within the meaning of Treasury Regulations Section 1.856-3(d)), to the extent that doing so would cause the Lessor to recognize income other than "rents from real property" as defined in Section 856(d) of the Code. All amounts in the Capital Expenditure Reserve Account are the property of Lessor. Lessee shall have no interest in the Capital Expenditure Reserve Account other than with respect to the funding of amounts in a Capital Budget approved by Lessor. ARTICLE XLthe

Capital Expenditures and Reserves. Lessor agrees to establish a reserve account together with all interest earned thereon for each Facility (the "Capital Expenditure Reserve Account") to fund Capital Expenditures in an amount equal to five four percent (54%) of annual Room Revenues from each Facility (or such greater amount necessary to fund capital improvements required to comply with applicable Legal Requirements or any requirements imposed by the franchisor in accordance with the Franchise Agreement or necessary to maintain the safety or structural soundness of the Leased Property)Facility, net of amounts actually expended for Capital Expenditures for such Facility during any Fiscal Year. Any funds escrowed pursuant to a Franchise Agreement or Mortgage and designated for Capital Expenditures shall be deemed to be part of the Capital Expenditure Reserve Account for the applicable Leased Property. Any funds escrowed pursuant to a Mortgage may be pledged as security for such Mortgage, which pledge may provide that, in the event of a default by Lessor under the Mortgage, the escrowed funds may be applied to the balance of the loan secured by the Mortgage; provided, however, that in the event the holder of the Mortgage exercises such remedy, Lessor shall be obligated immediately to deposit into the Capital Expenditure Reserve Account any amount which may then be necessary to bring the funds in such account (together with any funds remaining in any other accounts of Lessor dedicated for such purpose) up to the aggregate level required by this Article XXXIX . Lessor shall make such proceeds available for Capital Expenditures on the same terms and conditions set forth in such Mortgage provided the same are comparable to the terms of this LeaseXXXIX. The Capital Expenditure Reserve Account for each Facility may be commingled by Lessor with similar accounts of Lessor with respect to other hotel properties leased by Lessor to Lessee. The Capital Expenditures disbursed for a particular Facility shall be made pursuant to a Capital Budget and such expenditures may be more or less than the five percent (5%) of annual Room Revenues reserved by Lessor for such Facility in the Capital Expenditure Reserve Account. Upon request by Lessee not more frequently than twice a year, Lessor shall provide Lessee a written report stating the amounts held in such Capital Expenditure Reserve Account with respect to each Leased Property and amounts disbursed out of said account with respect to each Leased Property during the prior Fiscal Year. Upon written request by Lessee to Lessor stating the specific use to be made and the reasonable approval thereof by Lessor, the funds in the Capital Expenditure Reserve Account shall be made available by Lessor for use by Lessee for Capital Expenditures in connection with the Primary Intended Use; provided, however, that no amounts made available under this Article shall be used to purchase property (other than "real property" within the meaning of Treasury Regulations Section 1.856-3(d)), to the extent that doing so would cause the Lessor to recognize income other than "rents from real property" as defined in Section 856(d) of the Code. All amounts in the Capital Expenditure Reserve Account are the property of Lessor. Lessee shall have no interest in the Capital Expenditure Reserve Account other than with respect to the funding of amounts in a Capital Budget approved by Lessor. ARTICLE XLbe