Common use of Repairs and Equipment Reserve Clause in Contracts

Repairs and Equipment Reserve. A. Management Company shall establish, in respect of each Fiscal Year from and after the Management Commencement Date, a reserve escrow account in the name of TRS (“Reserve”) in a bank approved by TRS. All disbursements and withdrawals from the Reserve shall be made by representatives of Management Company whose signatures have been authorized. The Reserve shall be in an amount equal to the greater of: (i) four percent (4%) of Gross Revenues; or (ii) the amount required under the Franchise Agreement for the Hotel or by any Qualified Lender. The Reserve shall be held in a bank, savings and loan association, or other financial institution designated by TRS to cover cost of: (i) Replacements and renewals to the Hotel's FF&E; and (ii) Certain non-routine repairs and maintenance to the Hotel building which are normally capitalized under generally accepted accounting principles, such as exterior and interior repainting, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like, but which are not major repairs, alterations, improvements, renewals, or replacements to the Hotel building's structure or to its mechanical, electrical, heating, ventilating, air conditioning, plumbing, or vertical transportation systems, the cost of which are TRS's sole responsibility under Section 8.03. B. All amounts from time to time in the Reserve, and all interest thereon, shall at all times be owned by, and be the exclusive property of, TRS, and Management Company shall make no claim thereto. Proceeds from the sale of FF&E no longer necessary for the operation of the Hotel shall be deposited in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither (i) proceeds from the disposition of FF&E, nor (ii) interest which accrues on amounts held in the Reserve shall (x) result in any reduction in the required contributions to the Reserve set forth in 8.02 A above, or (y) be included in Gross Revenues. Management Company shall provide to TRS each month a copy of the bank statement relating to the Reserve and a reconciliation of such Reserve account. C. Management Company shall prepare an estimate (“FF&E Estimate”) of the expenditures necessary during the ensuing Fiscal Year for (i) replacement and renewal of the Hotel FF&E and (ii) building repairs of the nature contemplated by Section 8.02 A 2, and shall submit such FF&E Estimate to TRS for TRS's review and approval at the same time it submits the Preliminary Annual Operating Projection described in Section 9.03. D. Management Company shall from time to time make such substitutions and replacements of or renewals to FF&E and repairs to the Hotel of the nature described in Section 8.02 A 2, as are provided for in the FF&E Estimate approved for such Fiscal Year by TRS pursuant to Section 8.02 C, provided that Management Company shall not expend more than the balance in the Reserve without the prior approval of TRS. Management Company will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom (but not exceeding the Reserve balance), in its reasonable discretion, provided that (a) such departures from the FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (b) such departures from the FF&E Estimate result from circumstances which require prompt repair and/or replacement; and (c) Management Company has submitted to TRS a revised FF&E Estimate setting forth and explaining such departures. At the end of each Fiscal Year, any amounts then remaining in the Reserve shall be carried forward to the next Fiscal Year. E. If any FF&E Estimate which is prepared for a given Fiscal Year would require funding in excess of the percentage of Gross Revenues which is required under Section 8.02A, TRS may either (i) agree to increase the percentage of Gross Revenues up to the level set forth in such FF&E Estimate, in order to provide the additional funds required, such increases to be treated as Operating Expenses; or (ii) make a lump-sum contribution to the Reserve in the necessary amount, in which case such contribution plus interest (at Prime Rate plus one percentage point per annum) shall be reimbursed to TRS from Gross Revenues in equal installments over a period of time mutually agreed upon by TRS and Management Company, and such installment repayments shall be Operating Expenses. If TRS elects not to agree to either option for excess funding of the Reserve, Management Company shall be entitled, at its option, to terminate this Agreement upon ninety (90) days’ written notice to TRS; however, such failure by TRS shall not be deemed a Default by TRS unless such failure to provide excess funding will cause a default under the Franchise Agreement.

Repairs and Equipment Reserve. A. Management Company Owner shall establish, in respect of each Fiscal Year from and after the Management Commencement Effective Date, a reserve escrow account in the name of TRS Owner (“Reserve”) in a bank approved ). Management Company shall deposit the amount provided below into the Reserve that is held by TRSOwner. All disbursements and withdrawals from the Reserve shall be made by representatives of Management Company Owner whose signatures have been authorized. The Reserve shall be in an amount equal to the greater of: (i) four (a) for the first (1st) Fiscal Year, two and one-half percent (42.5%) of Gross Revenues; (b) for the second (2nd) Fiscal Year and thereafter, three percent (3%) of Gross Revenues or (ii) the amount required under the Franchise Agreement for the Hotel or by any Qualified Lender. The Reserve shall be held lender, in a bank, savings and loan association, association or other financial institution designated by TRS Owner to cover the cost of: (i) 1. Replacements and renewals to the Hotel's ’s FF&E; and (ii) 2. Certain non-routine repairs and maintenance to the Hotel building which are normally capitalized under generally accepted accounting principlesGAAP, such as exterior and interior repainting, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like, but which are not major repairs, alterations, improvements, renewals, renewals or replacements to the Hotel building's ’s structure or to its mechanical, electrical, heating, ventilating, air conditioning, plumbing, plumbing or vertical transportation systems, the cost of which are TRS's Owner’s sole responsibility under Section 8.03. B. All amounts from time to time in the Reserve, and all interest thereon, shall at all times be owned by, and be the exclusive property of, TRSOwner, and Management Company shall make no claim thereto. Proceeds from the sale of FF&E no longer necessary for the operation of the Hotel shall be deposited by Management Company in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither (i) proceeds from the disposition of FF&E, nor (ii) interest which accrues on amounts held in the Reserve shall (x) result in any reduction in the required contributions to the Reserve set forth in 8.02 A above, or (y) be included in Gross Revenues. Management Company shall provide to TRS each month a copy of the bank statement relating to the Reserve and a reconciliation of such Reserve account. C. Management Company shall prepare an estimate (“FF&E Estimate”) of the expenditures necessary during the ensuing Fiscal Year for (i) replacement and renewal of the Hotel FF&E and (ii) building repairs of the nature contemplated by Section 8.02 A 2A2 during the ensuing Fiscal Year, and shall submit such FF&E Estimate to TRS Owner for TRS's Owner’s review and approval at the same time it submits the Preliminary Annual Operating Projection described in Section 9.03. D. Management Company shall from time to time make such substitutions and replacements of or renewals to FF&E and repairs to the Hotel of the nature described in Section 8.02 A 2A2, as are provided for in the FF&E Estimate approved for such Fiscal Year by TRS Owner pursuant to Section 8.02 C, provided that Management Company shall not expend more than the balance in the Reserve without the prior approval of TRS. Management Company will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom (but not exceeding the Reserve balance), in its reasonable discretion, provided that (a) such departures from the FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (b) such departures from the FF&E Estimate result from circumstances which require prompt repair and/or replacement; and (c) Management Company has submitted to TRS a revised FF&E Estimate setting forth and explaining such departuresOwner. At the end of each Fiscal Year, any amounts then remaining in the Reserve shall be carried forward to the next Fiscal Year. E. If any FF&E Estimate which is prepared for a given Fiscal Year would require funding in excess of the percentage of Gross Revenues which is required under Section 8.02A, TRS Owner may either elect one of the following: (i) agree to increase the percentage of Gross Revenues up to the level set forth in such FF&E Estimate, in order to provide the additional funds required, such increases to be treated as Operating ExpensesDeductions; or (ii) make a lump-sum contribution to the Reserve in the necessary amount, amount and agree not to have such contribution reimbursed from Gross Revenues (in which case the amount of such contribution plus interest (at Prime Rate plus one percentage point per annum) shall be reimbursed added to TRS from Gross Revenues in equal installments over a period of time mutually agreed upon by TRS and Management Company, and such installment repayments shall be Operating ExpensesAdditional Invested Capital). If TRS Owner elects not to agree to either option any of such options for excess funding of the Reserve, Management Company shall be entitled, at its option, to terminate this Agreement upon ninety (90) days’ written notice to TRSOwner; however, such failure by TRS Owner shall not be deemed a Default by TRS Owner unless such failure to provide excess funding will cause a default by Owner under the Franchise Section 16.01 F of this Agreement.

Repairs and Equipment Reserve. A. Management Company shall establish, in respect of each Fiscal Year from and after the Management Commencement Date, a reserve escrow account in the name of TRS Owner (“"Reserve”") in a bank approved by TRSOwner. All disbursements and withdrawals from the Reserve shall be made by representatives of Management Company whose signatures have been authorized. The Reserve shall be in an amount equal to the greater of: (i) four percent (4%) ___% of Gross Revenues; Revenues or (ii) the amount required under the Franchise Agreement for the Hotel or by any Qualified Lender. The Reserve shall be held , in a bank, savings and loan association, association or other financial institution designated by TRS Owner to cover the cost of: (i) 1. Replacements and renewals to the Hotel's FF&E; and (ii) 2. Certain non-routine repairs and maintenance to the Hotel building which are normally capitalized under generally accepted accounting principlesGAAP, such as exterior and interior repainting, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like, but which are not major repairs, alterations, improvements, renewals, renewals or replacements to the Hotel building's structure or to its mechanical, electrical, heating, ventilating, air conditioning, plumbing, plumbing or vertical transportation systems, the cost of which are TRSOwner's sole responsibility under Section 8.03. B. All amounts from time to time in the Reserve, and all interest thereon, shall at all times be owned by, and be the exclusive property of, TRSOwner, and Management Company shall make no claim thereto. Proceeds from the sale of FF&E no longer necessary for the operation of the Hotel shall be deposited in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither (i) proceeds from the disposition of FF&E, nor (ii) interest which accrues on amounts held in the Reserve Reserve, shall either (x) result in any reduction in the required contributions to the Reserve set forth in 8.02 A above, or (y) be included in Gross Revenues. Management Company shall provide to TRS Owner each month a copy of the bank statement relating to the Reserve and a reconciliation of such Reserve account. C. Management Company shall prepare an estimate (“"FF&E Estimate”") of the expenditures necessary during the ensuing Fiscal Year for (i) replacement and renewal of the Hotel FF&E and (ii) building repairs of the nature contemplated by Section 8.02 A 22 during the ensuing Fiscal Year, and shall submit such FF&E Estimate to TRS Owner for TRSOwner's review and approval at the same time it submits the Preliminary Annual Operating Projection described in Section 9.03. D. Management Company shall from time to time make such substitutions and replacements of or renewals to FF&E and repairs to the Hotel of the nature described in Section 8.02 A 2, as are provided for in the FF&E Estimate approved for such Fiscal Year by TRS Owner pursuant to Section 8.02 C, provided that Management Company shall not expend more than the balance in the Reserve without the prior approval of TRSOwner. Management Company will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom (but not exceeding the Reserve balance), in its reasonable discretion, provided that (a) such departures from the FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (b) such departures from the FF&E Estimate result from circumstances which require prompt repair and/or replacement; and (c) Management Company has submitted to TRS Owner a revised FF&E Estimate setting forth and explaining such departures. At the end of each Fiscal Year, any amounts then remaining in the Reserve shall be carried forward to the next Fiscal Year. E. If any FF&E Estimate which is prepared for a given Fiscal Year would require funding in excess of the percentage of Gross Revenues which is required under Section 8.02A8.02 A, TRS Owner may either elect one of the following: (i) agree to increase the percentage of Gross Revenues up to the level set forth in such FF&E Estimate, in order to provide the additional funds required, such increases to be treated as Operating ExpensesDeductions; (ii) make a lump-sum contribution to the Reserve in the necessary amount and agree not to have such contribution reimbursed from Gross Revenues (in which case the amount of such contribution shall be added to Additional Invested Capital) or (iiiii) make a lump-sum contribution to the Reserve in the necessary amount, in which case such contribution plus interest (at Prime Rate plus one percentage point per annum) ), shall be reimbursed to TRS Owner from Gross Revenues in equal installments over a period of time mutually agreed upon by TRS Owner and Management Company, and such installment repayments shall be Operating ExpensesDeductions. If TRS Owner elects not to agree to either option any of such options for excess funding of the Reserve, Management Company shall be entitled, at its option, to terminate this Agreement upon ninety (90) days’ ' written notice to TRSOwner; however, such failure by TRS Owner shall not be deemed a Default by TRS Owner unless such failure to provide excess funding will cause a default by Owner under the Franchise Section 16.01.F of this Agreement.

Repairs and Equipment Reserve. A. Management Company shall establish, in respect of each Fiscal Year from and after the Management Commencement Date, a reserve escrow account in the name of TRS (“Reserve”) in a bank approved by TRS. All disbursements and withdrawals from the Reserve shall be made by representatives of Management Company whose signatures have been authorized. The Reserve shall be in an amount equal to the greater of: (i) four percent (4%) of Gross Revenues; or (ii) the amount required under the Franchise Agreement for the Hotel or by any Qualified Lender. The Reserve shall be held in a bank, savings and loan association, or other financial institution designated by TRS to cover cost of: (i) 1. Replacements and renewals to the Hotel's FF&E; and (ii) 2. Certain non-routine repairs and maintenance to the Hotel building which are normally capitalized under generally accepted accounting principles, such as exterior and interior repainting, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like, but which are not major repairs, alterations, improvements, renewals, or replacements to the Hotel building's structure or to its mechanical, electrical, heating, ventilating, air conditioning, plumbing, or vertical transportation systems, the cost of which are TRS's sole responsibility under Section 8.03. B. All amounts from time to time in the Reserve, and all interest thereon, shall at all times be owned by, and be the exclusive property of, TRS, and Management Company shall make no claim thereto. Proceeds from the sale of FF&E no longer necessary for the operation of the Hotel shall be deposited in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither (i) proceeds from the disposition of FF&E, nor (ii) interest which accrues on amounts held in the Reserve shall (x) result in any reduction in the required contributions to the Reserve set forth in 8.02 A above, or (y) be included in Gross Revenues. Management Company shall provide to TRS each month a copy of the bank statement relating to the Reserve and a reconciliation of such Reserve account. C. Management Company shall prepare an estimate (“FF&E Estimate”) of the expenditures necessary during the ensuing Fiscal Year for (i) replacement and renewal of the Hotel FF&E and (ii) building repairs of the nature contemplated by Section 8.02 A 2, and shall submit such FF&E Estimate to TRS for TRS's review and approval at the same time it submits the Preliminary Annual Operating Projection described in Section 9.03. D. Management Company shall from time to time make such substitutions and replacements of or renewals to FF&E and repairs to the Hotel of the nature described in Section 8.02 A 2, as are provided for in the FF&E Estimate approved for such Fiscal Year by TRS pursuant to Section 8.02 C, provided that Management Company shall not expend more than the balance in the Reserve without the prior approval of TRS. Management Company will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom (but not exceeding the Reserve balance), in its reasonable discretion, provided that (a) such departures from the FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (b) such departures from the FF&E Estimate result from circumstances which require prompt repair and/or replacement; and (c) Management Company has submitted to TRS a revised FF&E Estimate setting forth and explaining such departures. At the end of each Fiscal Year, any amounts then remaining in the Reserve shall be carried forward to the next Fiscal Year. E. If any FF&E Estimate which is prepared for a given Fiscal Year would require funding in excess of the percentage of Gross Revenues which is required under Section 8.02A8.02 A, TRS may either (i) agree to increase the percentage of Gross Revenues up to the level set forth in such FF&E Estimate, in order to provide the additional funds required, such increases to be treated as Operating Expenses; or (ii) make a lump-sum contribution to the Reserve in the necessary amount, in which case such contribution plus interest (at Prime Rate plus one percentage point per annum) shall be reimbursed to TRS from Gross Revenues in equal installments over a period of time mutually agreed upon by TRS and Management Company, and such installment repayments shall be Operating Expenses. If TRS elects not to agree to either option for excess funding of the Reserve, Management Company shall be entitled, at its option, to terminate this Agreement upon ninety (90) days’ written notice to TRS; however, such failure by TRS shall not be deemed a Default by TRS unless such failure to provide excess funding will cause a default under the Franchise Agreement.

Repairs and Equipment Reserve. A. Management Company shall establish, in respect of each Fiscal Year from and after the Management Commencement Date, a reserve escrow account in the name of TRS each respective Owner (each account is referred to as “Reserve”, collectively, the “Reserves”) in a bank approved by TRSOwners. For so long as Owner of the Hotel Facility is an Affiliate of First American, the Reserves shall be deposited in bank accounts at First American, as further described in Section 9.02. All disbursements and withdrawals from the Reserve Reserves shall be made by representatives of Management Company whose signatures have been authorized. The Each Reserve shall be in an amount equal to the greater of: three percent (i3%) of Gross Revenues of the Hotel Facility and Conference Center Facility, respectively, for the period beginning on February 15th after the Fiscal Year containing the Management Commencement Date and ending on the last day of the second full Fiscal Year; four percent (4%) of Gross RevenuesRevenues of the Hotel Facility and Conference Center Facility, respectively, during the third and fourth full Fiscal Year after the Management Commencement Date; and, unless otherwise agreed to by Owners pursuant to Section 11.2.1.1 of the Operating Agreement and approved by Management Company, five percent (5%) of Gross Revenues of the Hotel Facility and Conference Center Facility, respectively, during the fifth full Fiscal Year after the Management Commencement Date and for each Fiscal Year thereafter throughout the term of this Agreement; or (ii) exclusively with regard to the Hotel Facility, the amount required under the Franchise Agreement for the Hotel or by any Qualified Lender. The Reserve shall be held in a bank, savings and loan association, or other financial institution designated by TRS to cover the cost of: (i) Replacements 1. Replacements, refurbishment of, and renewals to the Hotel's respective Facility’s FF&E; and (ii) 2. Certain non-routine repairs repairs, alterations, refurbishment, and maintenance to the Hotel building Facility and Conference Center Facility buildings, as the case may be, which are normally capitalized under generally accepted accounting principles, such as exterior and interior repainting, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like, but which are not major repairs, alterations, improvements, renewals, renewals or replacements to the Hotel Facility or Conference Center Facility building's structure or to its mechanical, electrical, heating, ventilating, air conditioning, plumbing, plumbing or vertical transportation systems, the cost of which are TRS's the respective Owner’s sole responsibility under Section 8.03. B. As provided in Section 11.2.1.1 of the Operating Agreement, the percentage contributions to each of the Reserve accounts as stated in subsection A above shall commence on February 15th after the Fiscal Year containing the Management Commencement Date. All amounts from time to time in the each Reserve, and all interest thereon, shall at all times be owned by, and be the exclusive property of, TRSthe respective Owner, and Management Company shall make no claim thereto. Proceeds from the sale of FF&E no longer necessary for to the operation of the Hotel Facility or Conference Center Facility, as the case may be, shall be deposited in the respective Reserve, as shall any interest which accrues on amounts placed in the respective Reserve. Neither (i) proceeds from the disposition of FF&E, nor (ii) interest which accrues on amounts held in the Reserve Reserve, shall either (x) result in any reduction in the required contributions to the Reserve set forth in 8.02 A above, or (y) be included in Gross Revenues. At the end of each Fiscal Year, any amounts then remaining in the Reserve shall be carried forward to the next Fiscal Year. Management Company shall provide to TRS Owners each month a copy of the bank statement relating to the each Reserve and a reconciliation of such each Reserve account, separately accounting for the percentage contributions to each Reserve made by each Owner (including interest which accrued on amounts held in the Reserve and FF&E sale proceeds, if any) and expenditures from each Reserve for each of the Facilities, it being understood that cost of any such expenditures paid with respect to the Shared Facilities shall be allocated twenty-five percent (25%) to the Conference Center Facility Reserve and seventy-five percent (75%) to the Hotel Facility Reserve. Upon Termination of this Agreement and reconciliation of the final accounting statement (as further described in Section 5.02), any remaining amounts in the Reserves shall be paid to each respective Owner. C. Management Company shall prepare an a rolling three year estimate (“"FF&E Estimate”") of the expenditures necessary during the ensuing Fiscal Year for (i) replacement and renewal of the Hotel FF&E and (ii) building repairs of the nature contemplated by Section 8.02 A 22 during the ensuing Fiscal Year for each of the Facilities, and shall submit such FF&E Estimate to TRS Owners for TRS's Owners' review and approval at the same time it submits the Preliminary Revised Annual Operating Projection described in Section 9.03.9.03 B. D. Management Company shall from time to time make such substitutions and replacements of or renewals to FF&E and repairs to the Hotel & Conference Center of the nature described in Section 8.02 A 2, as are provided for in the FF&E Estimate approved for such Fiscal Year by TRS Owners pursuant to Section 8.02 C, provided that Management Company shall not expend more than the balance in the Reserve without the prior written approval of TRSOwners. Management Company will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom (but not exceeding the Reserve balance), in its reasonable discretion, provided that (a) such departures from the FF&E Estimate result from circumstances which that could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (b) such departures from the FF&E Estimate result from circumstances which that require prompt repair and/or replacement; and (c) Management Company has submitted to TRS Owners a revised FF&E Estimate setting forth and explaining such departures. At the end of each Fiscal Year, any amounts then remaining in the Reserve The revised FF&E Estimate shall be carried forward submitted to Owners prior to any such departure unless such departure (x) results from circumstances described in clause (b) above or (y) is required by circumstances described in clauses (i) or (ii) of Section 8.03 A, and Management Company cannot reasonably submit such revised FF&E Estimate prior to making such departure, in which case the revised FF&E Estimate shall be submitted to Owners promptly following said departure. Notwithstanding any provision in this Agreement to the next Fiscal Yearcontrary, Management Company shall make no material alterations, additions or improvements in or to the Hotel & Conference Center without the prior written approval of the Owners, which shall be in their sole discretion and shall be based upon the recommendation of Management Company. E. If any FF&E Estimate which is prepared for a given Fiscal Year would require funding in excess of the percentage of Gross Revenues which is required under Section 8.02A8.02 A, TRS the respective Owner may either (i) agree to increase the percentage of Gross Revenues up to the level set forth in such FF&E Estimate, in order to provide the additional funds required, such increases to be treated as Operating ExpensesDeductions; or (ii) make a lump-sum contribution to the Reserve in the necessary amount, in which case such contribution plus interest (at Prime Rate plus one percentage point per annum) shall be reimbursed credited against future percentage contributions to TRS from Gross Revenues be made to the Reserve in equal installments over a period accordance with Section 11.2.1.2 (with respect to the Hotel Facility) or Section 11.3.1.2 (with respect to the Conference Center Facility) of time mutually agreed upon by TRS and Management Company, and such installment repayments shall be the Operating ExpensesAgreement. If TRS the Owner or Owners elects not to agree to either option for excess funding of the Reserve, Management Company shall be entitled, at its option, to terminate this Agreement upon ninety (90) days’ written notice to TRSOwners; however, such failure by TRS an Owner or Owners shall not be deemed a Default by TRS such Owner or Owners unless such failure to provide excess funding will cause a default under the Franchise any agreement in which such Owner or Owners are a party which would then allow any other party under such agreement to terminate this Agreement.

Repairs and Equipment Reserve. A. As of the Effective Date, Management Company shall establishhas, in respect on behalf of each Fiscal Year from and after the Management Commencement DateOwner, a reserve established an escrow account in the name of TRS (“"Repairs and Equipment Reserve”") in a bank approved selected by TRS. All disbursements and withdrawals Management Company, subject to Owner's approval, into which the funds from the Reserve shall be made by representatives of Management Company whose signatures maintained pursuant to the Operating Lease have been authorized. The transferred as of the Effective Date and which Repairs and Equipment Reserve shall be funded as set forth in an amount equal to the greater of: (i) four percent (4%) of Gross Revenues; or (ii) the amount required under the Franchise Agreement for the Hotel or by any Qualified Lender. The Reserve shall be held in a bankSection 8.02 B, savings and loan association, or other financial institution designated by TRS to cover the cost of: (i) 1. Replacements and renewals to the furniture, furnishings, fixtures and equipment ("FF&E") of the Hotel's FF&E; and (ii) 2. Certain non-routine repairs and maintenance to the Hotel building which are normally capitalized under generally accepted accounting principles, principles such as exterior and interior repainting, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like, but which are not major repairs, alterations, improvements, renewals, renewals or replacements to the Hotel building's structure or to its mechanical, electrical, heating, ventilating, air conditioning, plumbing, plumbing or vertical transportation systems, the cost of which are TRSOwner's sole responsibility under Section 8.03. B. Management Company shall, on behalf of Owner, transfer into the Repairs and Equipment Reserve, subject to the provisions of Section 8.02 F, an amount equal to five percent (5%) of Gross Revenues for each such Fiscal Year. All amounts from time such transfers shall take place with respect to time each Accounting Period and shall be accounted for cumulatively and adjusted at the close of each Fiscal Year. Any amount remaining in the Reserve, Repairs and all interest thereon, Equipment Reserve upon Termination shall at all times be owned by, and be the exclusive property of, TRS, and Management Company shall make no claim thereto. Proceeds paid to Owner. C. Any proceeds from the sale of FF&E no longer necessary for to the operation of the Hotel shall be deposited in credited to the Reserve, as shall any interest which accrues on amounts placed in the Repairs and Equipment Reserve. Neither (i) proceeds from the disposition of FF&E, nor (ii) Any interest which accrues on amounts held in the Reserve paid upon such account shall (x) result in any reduction in the required contributions also be credited to the Reserve set forth in 8.02 A above, or (y) be included in Gross RevenuesRepairs and Equipment Reserve. Management Company shall provide to TRS each month a copy of the bank statement relating to the Reserve and a reconciliation of such Reserve account.The C. D. Each Fiscal Year Management Company shall prepare an estimate (“the "FF&E Estimate”") of the expenditures necessary during for the ensuing Fiscal Year for (i) replacement of FF&E, as well as the non-routine repairs and renewal of the Hotel FF&E and (ii) building repairs of the nature contemplated by maintenance described in Section 8.02 A 2, during the next Fiscal Year and shall submit such FF&E Estimate to TRS for TRS's review and approval Owner at the same time as it submits the Preliminary Annual Operating Projection described in Section 9.03Budget. D. E. Management Company shall from time to time make such substitutions and replacements of or renewals to FF&E FF&E, as well as the non-routine repairs and repairs to the Hotel of the nature maintenance described in Section 8.02 A 2, as are provided for it deems necessary up to the balance in the Repairs and Equipment Reserve. No expenditures will be made from the Repairs and Equipment Reserve other than in accordance with the preceding sentence. To the extent reasonably feasible Management Company will follow the FF&E Estimate approved for such Fiscal Year by TRS pursuant to Section 8.02 C, provided that Management Company shall not expend more than in making such expenditures. No expenditures will be made in excess of the balance in the Repairs and Equipment Reserve without the prior approval of TRS. Management Company will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom (but not exceeding the Reserve balance), in its reasonable discretion, provided that (a) such departures from the FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (b) such departures from the FF&E Estimate result from circumstances which require prompt repair and/or replacement; and (c) Management Company has submitted to TRS a revised FF&E Estimate setting forth and explaining such departuresOwner. At the end of each Fiscal Year, any amounts then remaining in the Repairs and Equipment Reserve shall be carried forward to the next Fiscal Year. E. If any FF&E Estimate which is prepared for a given Fiscal Year would require funding in excess of the F. The annual percentage of Gross Revenues which to be placed in the Repairs and Equipment Reserve as set forth in Section 8.02 B is required under Section 8.02Aan estimate based upon Management Company's prior experience with other comparable hotels. If, TRS in good faith, Management Company feels at any time during the term of this Agreement that such percentage has become excessive given the needs of the Hotel, such percentage will be reduced to such an amount as Management Company deems reasonably necessary for the proper operation of the Hotel. On the other hand, as the Hotel ages, this percentage may either (i) agree not be sufficient to maintain the Hotel as a first-class hotel and, therefore, if, in any given Fiscal Year, the FF&E Estimate prepared in good faith by Management Company exceeds available funds in the Repairs and Equipment Reserve, Owner will either: 1. Agree to increase the percentage annual percentages of Gross Revenues up contributed to the level set forth in such FF&E Estimate, in order Repairs and Equipment Reserve to provide the additional funds required, or 2. Obtain financing for the additional funds required; in such increases event, the principal and interest payments (which shall be on a commercially reasonable amortization basis) with respect to such financing will be treated as Deductions in computing Operating Expenses; Profit. A failure or (ii) make a lump-sum contribution to the Reserve in the necessary amount, in which case such contribution plus interest (at Prime Rate plus one percentage point per annum) shall be reimbursed to TRS from Gross Revenues in equal installments over a period of time mutually agreed upon refusal by TRS and Management Company, and such installment repayments shall be Operating Expenses. If TRS elects not Owner to agree to either option for excess funding of the Reserve, 1 or 2 above within a sixty (60) day period after Management Company's request therefor shall entitle Management Company shall be entitled, at its option, to terminate this Agreement upon ninety six (906) days’ months' written notice to TRS; however, such failure by TRS shall not be deemed a Default by TRS unless such failure to provide excess funding will cause a default under the Franchise Agreementnotice.

Repairs and Equipment Reserve. A. Management Company shall establish, in respect of each Fiscal Year from and after the Management Commencement Date, a reserve escrow account in the name of TRS Owner (“Reserve”) in a bank approved by TRSOwner. All disbursements and withdrawals from the Reserve shall be made by representatives of Management Company whose signatures have been authorized. The Reserve shall be in an amount equal to the greater of: (i) four percent (4%) % of Gross Revenues; Revenues or (ii) the amount required under the Franchise Agreement for the Hotel or by any Qualified Lender. The Reserve shall be held , in a bank, savings and loan association, association or other financial institution designated by TRS Owner to cover the cost of: (i) 1. Replacements and renewals to the Hotel's ’s FF&E; and (ii) 2. Certain non-routine repairs and maintenance to the Hotel building which are normally capitalized under generally accepted accounting principlesGAAP, such as exterior and interior repainting, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like, but which are not major repairs, alterations, improvements, renewals, renewals or replacements to the Hotel building's ’s structure or to its mechanical, electrical, heating, ventilating, air conditioning, plumbing, plumbing or vertical transportation systems, the cost of which are TRS's Owner’s sole responsibility under Section 8.03. B. All amounts from time to time in the Reserve, and all interest thereon, shall at all times be owned by, and be the exclusive property of, TRSOwner, and Management Company shall make no claim thereto. Proceeds from the sale of FF&E no longer necessary for the operation of the Hotel shall be deposited in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither (i) proceeds from the disposition of FF&E, nor (ii) interest which accrues on amounts held in the Reserve Reserve, shall either (x) result in any reduction in the required contributions to the Reserve set forth in 8.02 A above, or (y) be included in Gross Revenues. Management Company shall provide to TRS Owner each month a copy of the bank statement relating to the Reserve and a reconciliation of such Reserve account. C. Management Company shall prepare an estimate (“FF&E Estimate”) of the expenditures necessary during the ensuing Fiscal Year for (i) replacement and renewal of the Hotel FF&E and (ii) building repairs of the nature contemplated by Section 8.02 A 22 during the ensuing Fiscal Year, and shall submit such FF&E Estimate to TRS Owner for TRS's Owner’s review and approval at the same time it submits the Preliminary Annual Operating Projection described in Section 9.03. D. Management Company shall from time to time make such substitutions and replacements of or renewals to FF&E and repairs to the Hotel of the nature described in Section 8.02 A 2, as are provided for in the FF&E Estimate approved for such Fiscal Year by TRS Owner pursuant to Section 8.02 C, provided that Management Company shall not expend more than the balance in the Reserve without the prior approval of TRSOwner. Management Company will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom (but not exceeding the Reserve balance), in its reasonable discretion, provided that (a) such departures from the FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (b) such departures from the FF&E Estimate result from circumstances which require prompt repair and/or replacement; and (c) Management Company has submitted to TRS Owner a revised FF&E Estimate setting forth and explaining such departures. At the end of each Fiscal Year, any amounts then remaining in the Reserve shall be carried forward to the next Fiscal Year. E. If any FF&E Estimate which is prepared for a given Fiscal Year would require funding in excess of the percentage of Gross Revenues which is required under Section 8.02A8.02 A, TRS Owner may either elect one of the following: (i) agree to increase the percentage of Gross Revenues up to the level set forth in such FF&E Estimate, in order to provide the additional funds required, such increases to be treated as Operating ExpensesDeductions; (ii) make a lump-sum contribution to the Reserve in the necessary amount and agree not to have such contribution reimbursed from Gross Revenues (in which case the amount of such contribution shall be added to Additional Invested Capital) or (iiiii) make a lump-sum contribution to the Reserve in the necessary amount, in which case such contribution plus interest (at Prime Rate plus one percentage point per annum) ), shall be reimbursed to TRS Owner from Gross Revenues in equal installments over a period of time mutually agreed upon by TRS Owner and Management Company, and such installment repayments shall be Operating ExpensesDeductions. If TRS Owner elects not to agree to either option any of such options for excess funding of the Reserve, Management Company shall be entitled, at its option, to terminate this Agreement upon ninety (90) days’ written notice to TRSOwner; however, such failure by TRS Owner shall not be deemed a Default by TRS Owner unless such failure to provide excess funding will cause a default by Owner under the Franchise Section 16.01.F of this Agreement.

Repairs and Equipment Reserve. A. Management Company shall establish, in respect of each Fiscal Year from establish an escrow reserve account (the "Repairs and after Equipment Reserve" or the Management Commencement Date, a reserve escrow account in the name of TRS (“"Reserve”") in a bank approved designated by TRS. All disbursements and withdrawals from the Reserve shall be made by representatives of Management Company whose signatures have been authorized. The Reserve shall be in an amount equal to the greater of: (i) four percent (4%) of Gross Revenues; or (ii) the amount required under the Franchise Agreement for the Hotel or by any Qualified Lender. The Reserve shall be held in a bank, savings and loan association, or other financial institution designated by TRS to cover the cost of: (i) 1. Replacements and renewals to the Hotel's FF&E; and (ii) 2. Certain non-routine repairs and maintenance to the Hotel building which that are normally capitalized under generally accepted accounting principles, principles such as exterior and interior repainting, resurfacing building walls, floors, roofs roofs, and parking areas, and replacing folding walls and the like, but which that are not major repairs, alterations, improvements, renewals, or replacements to the Hotel building's structure or to its mechanical, electrical, heating, ventilating, air conditioning, plumbing, or vertical transportation systems, the cost of which are TRSOwner's sole responsibility under Section 8.037.03. B. All amounts from During the period of time up to time in the Reserveexpiration of the first full Fiscal Year after the Effective Date, and all interest thereon, shall at all times be owned by, and be the exclusive property of, TRS, and Management Company shall make no claim thereto. Proceeds from the sale of FF&E no longer necessary for the operation of the Hotel shall be deposited in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither (i) proceeds from the disposition of FF&E, nor (ii) interest which accrues on amounts held in transfer into the Reserve shall an amount equal to one percent (x1%) result in any reduction in of Gross Revenues for such period of time; during the required contributions to second full Fiscal Year after the Reserve set forth in 8.02 A aboveEffective Date, or (y) be included in Gross Revenues. Management Company shall provide transfer into the Reserve an amount equal to TRS two percent (2%) of Gross Revenues for such Fiscal Year; during the third, fourth, and fifth full Fiscal Years after the Effective Date, Management Company shall transfer into the Reserve an amount equal to three percent (3%) of Gross Revenues for each month a copy of such Fiscal Years; during the bank statement relating sixth through the tenth full Fiscal Years after the Effective Date, Management Company shall transfer into the Reserve an amount equal to four percent (4%) of Gross Revenues for each of such Fiscal Years; commencing with the eleventh full Fiscal Year after the Effective Date and for all Fiscal Years thereafter, subject to the provisions of section 8.02 E, Management Company shall transfer into the Reserve and a reconciliation an amount equal to five percent (5%) of Gross Revenues for each of such Reserve accountFiscal Years. C. Management Company shall prepare an estimate (“FF&E Estimate”) of the expenditures necessary during the ensuing Fiscal Year for (i) replacement and renewal of the Hotel FF&E and (ii) building repairs of the nature contemplated by Section 8.02 A 2, and shall submit such FF&E Estimate to TRS for TRS's review and approval at the same time it submits the Preliminary Annual Operating Projection described in Section 9.03. D. Management Company shall from time to time make such substitutions (1) replacements and replacements of or renewals to FF&E the Hotel's FF&E, and (2) repairs to the Hotel building of the nature described in Section 8.02 A 7.02A 2, as are provided for in the FF&E Estimate approved for such Fiscal Year by TRS pursuant it deems necessary, up to Section 8.02 C, provided that Management Company shall not expend more than the balance in the Repairs and Equipment Reserve. No expenditures shall be made from the Reserve other than as set forth in the preceding sentence. No expenditures shall be made in excess of said balance without the prior approval of TRS. Management Company will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom (but not exceeding the Reserve balance), in its reasonable discretion, provided that (a) such departures from the FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (b) such departures from the FF&E Estimate result from circumstances which require prompt repair and/or replacement; and (c) Management Company has submitted to TRS a revised FF&E Estimate setting forth and explaining such departuresOwner. At the end of each Fiscal Year, any amounts then remaining in the Repairs and Equipment Reserve shall be carried forward to the next Fiscal Year. Proceeds from the sale of FF&E no longer necessary to the operation of the Hotel shall be deposited in the Reserve and credited against the amount otherwise required to be deposited in the Reserve under Section 7.02B, as shall any interest that accrues on amounts in the Reserve. D. Management Company shall prepare an estimate ("Repairs and Equipment Estimate") of the expenditures necessary for (1) replacements and renewals to the Hotel's FF&E, and (2) repairs to the Hotel building of the nature described in Section 7.02A 2, during the ensuing Fiscal Year and shall submit such Repairs and Equipment Estimate to Owner at the same time as it submits the Annual Operating Projection described in Section 8.03. If Owner fails to approve the Repairs and Equipment Estimate within thirty (30) days of its receipt, Management Company may terminate this Agreement upon six (6) months written notice to Owner. E. If any FF&E Estimate which is prepared The contributions for a given Fiscal Year would require funding the Repairs and Equipment Reserve described in excess Section 7.02B are estimates based on Management Company's prior experience with new hotels. As the Hotel ages, these percentages may not be sufficient to keep the Reserve at the levels necessary to make the replacements and renewals to the Hotel's FF&E, or to make the repairs to the Hotel building of the percentage of Gross Revenues nature described in Section 7.02A 2, or which is are required under Section 8.02Ato maintain the Hotel as a first-class facility. If the Repairs and Equipment Estimate prepared in good faith by Management Company exceeds the available funds in the Repairs and Equipment Reserve, TRS may either (i) agree Owner may: 1. Agree to increase the annual percentage of Gross Revenues up to the level set forth in such FF&E Estimate, in order Section 7.02B to provide the additional funds required, such increases or 2. Arrange to be treated as Operating Expenses; or (ii) make a lump-sum contribution to obtain outside financing for the Reserve in the necessary amountadditional funds required, in which case event the principal and interest payments on such contribution plus interest financing shall constitute Deductions in determining Net House Profit. A failure or refusal by Owner to accept either 1 or 2 above within a sixty (at Prime Rate plus one percentage point per annum60) shall be reimbursed to TRS from Gross Revenues in equal installments over a day period of time mutually agreed upon by TRS and after Management Company, and such installment repayments 's request therefor shall be Operating Expenses. If TRS elects not entitle Management Company to agree terminate the Agreement upon six (6) months' written notice to either option for excess funding of the Reserve, Owner. F. Management Company shall be entitlednot, at however, exercise its option, option to terminate this Agreement upon ninety (90) days’ written notice under Sections 7.02D or E unless the Parties have made reasonable efforts to TRS; however, such failure by TRS shall not be deemed a Default by TRS unless such failure to provide excess funding will cause a default under agree on the Franchise AgreementRepairs and Equipment Estimate.

Repairs and Equipment Reserve. A. The Management Company shall establish, in respect of each Fiscal Year from and after during the Management Commencement Dateterm of this Agreement, a reserve escrow account in on the name Hotel's books of TRS account (“"Repairs and Equipment Reserve”" or the "Reserve") in a bank approved by TRS. All disbursements and withdrawals from the Reserve shall be made by representatives of Management Company whose signatures have been authorized. The Reserve shall be in an amount equal to the greater of: (i) four percent (4%) of Gross Revenues; or (ii) the amount required under the Franchise Agreement for the Hotel or by any Qualified Lender. The Reserve shall be held in a bank, savings and loan association, or other financial institution designated by TRS to cover cost ofthe expenditures for: (i) 1. Replacements and renewals to the Hotel's FF&E; and; (ii) Certain non-routine repairs and maintenance to the Hotel building which are normally capitalized under generally accepted accounting principles, such as exterior 2. Exterior and interior repainting, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like, but walls; and 3. All other non-routine repairs (which are not major repairsexpensed for purposes of the financial statements of the Hotel), alterations, improvements, renewals, or renewals and replacements to the Hotel building's structure or to its mechanical(without limitation) structural, electrical, heatingbeating, ventilating, air air- conditioning, plumbing, or plumbing and vertical transportation systemselements of the Hotel building, to the cost extent that there are funds available in the Reserve after covering the costs of which are TRS's sole responsibility under Section 8.03categories 1 and 2 above. B. During the first Fiscal Year after the Opening Date, an amount equal to [ ] percent [ ] of the Hotel's Gross Revenues for such Fiscal Year shall be placed in the Reserve; during the second Fiscal Year after the Opening Date,,an amount equal to [ ] percent [ ] of the Hotel's Gross Revenues for such Fiscal Year shall be placed in the Reserve; during the third, fourth and fifth Fiscal Years after the Opening Date, an amount equal to [ ] percent [ ] of the Hotel's Gross Revenues for each of such Fiscal Years shall be placed in the Reserve; during the sixth through the tenth Fiscal Years after the Opening Date, an amount equal to [ ] percent [ ] of the Hotel's Gross Revenues for each of such Fiscal Years shall be placed in the Reserve; commencing with the eleventh Fiscal Year after the Opening Date and for all Fiscal Years thereafter, subject to the provisions of G, below, annual deductions for the Repairs and Equipment Reserve shall be an amount equal [ ] percent [ ] of Gross Revenues. C. The Reserve will be maintained in an escrow account set up in the name of the Owner. All amounts from time interest accruing on any funds deposited in said account will be credited to time in the Reserve, and all interest thereonthe amount that would otherwise be transferred to the Reserve shall be reduced by the amount so credited. If, at any time, the accumulated cash left in the Reserve exceeds the sum of the contributions made to it during the two (2) preceding Fiscal Years, further contributions will be temporarily suspended until they can be made without causing the accumulated cash in the Reserve to exceed said limit. Any amounts remaining in the Repairs and Equipment Reserve upon Termination shall at all times be owned bytransferred to Owner, and be the exclusive property of, TRS, and Management Company shall make no claim thereto. Proceeds from the sale of FF&E no longer necessary for unless the operation of the Hotel is being discontinued at the same or approximately the same time as such Termination, in which event the amount remaining in the Repairs and Equipment Reserve shall be deposited transferred to Operating Profit. D. Owner shall have the right to withdraw any amounts accumulated in the Reserve by delivery to Management Company of an irrevocable letter of credit from a responsible banking institution approved by Management Company (such approval not to be unreasonably withheld or delayed) covering the full amount of such withdrawal. At least one (1) month prior to the expiration of any such letter of credit, Owner shall either provide a new letter of credit, or make a cash deposit into the Reserve escrow account equal to the amount previously withdrawn, or advise Management Company to exercise its rights under the letter of credit. The terms of any such letter of credit will in any event provide that Management Company shall have the right, at any time, in order to pay for expenditures properly chargeable to the Reserve, as shall any interest which accrues on to present said letter of credit for immediate payment. Any amounts placed in the Reserve. Neither (i) proceeds withdrawn by Owner from the disposition Repairs and Equipment Reserve pursuant to the foregoing procedure shall be deemed, for purposes of FF&E, nor (ii) interest which accrues the maximum limitation on amounts held accumulated cash in the Reserve shall (x) result in any reduction in the required contributions to the Reserve set forth in 8.02 A subsection C above, or (y) be included in Gross Revenues. Management Company shall provide to TRS each month a copy of the bank statement relating to the Reserve and a reconciliation of such Reserve accounthave not been so withdrawn. C. Management Company shall prepare an estimate (“FF&E Estimate”) of the expenditures necessary during the ensuing Fiscal Year for (i) replacement and renewal of the Hotel FF&E and (ii) building repairs of the nature contemplated by Section 8.02 A 2, and shall submit such FF&E Estimate to TRS for TRS's review and approval at the same time it submits the Preliminary Annual Operating Projection described in Section 9.03. D. E. The Management Company shall from time to time make such substitutions and replacements of or renewals to FF&E and repairs to the Hotel building of the nature described in Section Sections 8.02 A 22 and 8.02 A 3 as it deems necessary, as are provided for in the FF&E Estimate approved for such Fiscal Year by TRS pursuant up to Section 8.02 C, provided that Management Company shall not expend more than the balance in the Reserve Repairs and Equipment Reserve. No expenditure will be made in excess of said balance without the prior approval of TRSOwner. Management Company will endeavor Any proceeds from the sale of FF&E no longer necessary to follow the applicable FF&E Estimate, but operation of the Hotel shall be entitled credited to depart therefrom (but not exceeding the Repairs and Equipment Reserve, and the amount that would otherwise be transferred to the Reserve balance), in its reasonable discretion, provided that (a) such departures from shall be reduced by the FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (b) such departures from the FF&E Estimate result from circumstances which require prompt repair and/or replacement; and (c) Management Company has submitted to TRS a revised FF&E Estimate setting forth and explaining such departuresamount so credited. At the end of each Fiscal Year, any amounts then remaining in the Repairs and Equipment Reserve shall be carried forward to the next Fiscal Year. E. If any F. The Management Company shall prepare a detailed budget ("Repairs and Equipment Budget") of the expenditures necessary for replacements and renewals of FF&E Estimate which is prepared for a given and expenditures of the nature contemplated by Sections 8.02 A 2 and 8.02 A 3 during the ensuing Fiscal Year would require funding and shall submit such Repairs and Equipment Budget to Owner at the same time it submits the Annual Operating Projection described in excess Section 9.03. Owner shall have the right to approve (said approval not to be unreasonably withheld) all expenditures described in the Repairs and Equipment Budget except for certain items to be selected by Management Company (not to exceed in the aggregate the greater of [ ] or [ ] of the percentage of Gross Revenues which is required under Section 8.02A, TRS may either (i) agree to increase the percentage of Gross Revenues up to the level set forth in such FF&E Estimate, in order to provide the additional funds required, such increases estimated amount to be treated as Operating Expenses; or (ii) make a lump-sum contribution contributed to the Reserve in the necessary amountapplicable Fiscal Year), as to which the Management Company's selection shall not be subject to the approval of Owner.If Owner disapproves any item or items within the Repairs and Equipment Budget, it shall be obligated to recommend alternative expenditures in an equal aggregate dollar amount for that particular Fiscal Year. In the event the Management Company fails to accept Owner's recommendations as to alternative expenditures, the items in dispute on the Repairs and Equipment Budget will be submitted to a recognized hotel accounting firm for resolution, in which case such contribution plus interest (at Prime Rate plus one percentage point per annum) keeping with the need to maintain the position of the Hotel in its geographical market and as a member of the Marriott chain of hotels. Such firm shall be reimbursed jointly selected by Owner and Management Company (neither such approval to TRS from Gross Revenues be unreasonably withheld). Such accounting firm's decision on such matters will be binding on the parties, and the expenses incurred for such firm's analysis and determination will constitute a Deduction for the Fiscal Year in equal installments over a period which they are paid. G. The adequacy of the percentage Deduction for the Repairs and Equipment Reserve described in Section 8.02 A is an estimate based upon the Management Company's prior experience with new hotels. If, in good faith, Management Company feels at any time mutually agreed upon by TRS and during the term of this Agreement that such percentages have become excessive given the needs of the Hotel, such percentages will be reduced. On the other hand, as the Hotel ages, these percentage Deductions may not be sufficient, in the good faith belief of Management Company, to keep the Reserve at the levels necessary to make the replacements, substitutions and such installment repayments shall be Operating Expensesrenewals to the FF&E or to otherwise make the appropriate building repairs required to maintain the Hotel as a first-class facility. If TRS elects not the Repairs and Equipment Estimate prepared in good faith by the Management Company exceeds the available funds in the Repairs and Equipment Reserve, Owner will in good faith consider reasonable proposals made by the Management Company, in keeping with the need to agree to either option for excess funding maintain the position of the Reserve, Management Company shall be entitled, at Hotel in its option, to terminate this Agreement upon ninety (90) days’ written notice to TRS; however, such failure by TRS shall not be deemed competitive geographical market and as a Default by TRS unless such failure to provide excess funding will cause a default under member of the Franchise AgreementMarriott chain.

Repairs and Equipment Reserve. A. Management Company Manager shall establish, in on a consolidated basis (or on such other basis as may be reasonably required by lenders providing financing to Owner with respect of each Fiscal Year from to the Inns), an escrow reserve account ("Repairs and after Equipment Reserve" or the Management Commencement Date"Reserve"), a reserve escrow account in the name of TRS (“Reserve”) in a bank approved by TRS. All disbursements or similar institution reasonably acceptable to both Manager and withdrawals from the Reserve shall be made by representatives of Management Company whose signatures have been authorized. The Reserve shall be in an amount equal to the greater of: (i) four percent (4%) of Gross Revenues; or (ii) the amount required under the Franchise Agreement for the Hotel or by any Qualified Lender. The Reserve shall be held in a bankOwner, savings and loan association, or other financial institution designated by TRS to cover the cost of: (i) 1. Replacements and renewals related solely to the Hotel's FF&EFF&E of the Inns; and (ii) 2. Certain non-routine repairs and maintenance to the Hotel building each Inn's Building which are normally capitalized under generally accepted accounting principles, such as exterior and interior repainting, ; resurfacing building walls, floors, roofs and parking areas, ; buying or leasing replacement vehicles; and replacing folding walls and the like, but which are not major repairs, alterations, improvements, renewals, renewals or replacements to the Hotel buildingsuch Building's structure or to its mechanical, electrical, heating, ventilating, air conditioning, plumbing, plumbing or vertical transportation systems, the cost of which are TRS's sole responsibility to be paid by Owner under Section 8.037.03, rather than from the Reserve. B. All amounts from time to time No portion of funds held in the ReserveReserve prior to the Amendment Date shall be allocated to the new, and all interest thereon, shall at all times be owned by, and be the exclusive property of, TRS, and Management Company shall make no claim thereto. Proceeds from the sale of FF&E no longer necessary separate management agreement for the operation Bossier City Inn. As of the Hotel Amendment Date, Manager holds the balance of funds contributed to the Reserve under the Management Agreement. For each Fiscal Year during the term of this Agreement, subject to the provisions of subsection E below, Manager shall transfer into the Reserve an amount equal to five percent (5%) of Gross Revenues. Transfers into the Reserve shall be deposited made at the time of each interim accounting described in Section 5.04.A hereof. Commencing with Fiscal Year 2001, Manager shall have the Reserveright, as shall but not the obligation, to increase the amount it transfers into the Reserve to any interest which accrues on amounts placed amount greater than five percent (5%) but not exceeding six percent (6%) of Gross Revenues for such Fiscal Year and successive Fiscal Year thereafter if, based upon a review of Replacement FF&E requirements for the Inns, such increase is necessary in Manager's reasonable judgment to fund future Replacement FF&E that would be necessary to maintain the ReserveInns in accordance with Manager's standards for Residence Inns. Neither (i) proceeds from the disposition of FF&E, nor (ii) interest which accrues on Any amounts held in the Reserve shall (x) result in any reduction in may be applied, as between the required contributions Inns, without regard to the Reserve set forth in 8.02 A above, or (y) be included in Gross Revenues. Management Company shall provide to TRS each month a copy of the bank statement relating to the Reserve and a reconciliation source of such Reserve account. C. Management Company shall prepare an estimate (“FF&E Estimate”) of the expenditures necessary during the ensuing Fiscal Year for (i) replacement and renewal of the Hotel FF&E and (ii) building repairs of the nature contemplated by Section 8.02 A 2, and shall submit such FF&E Estimate to TRS for TRS's review and approval at the same time it submits the Preliminary Annual Operating Projection described in Section 9.03. D. Management Company shall from time to time make such substitutions and replacements of or renewals to FF&E and repairs to the Hotel of the nature described in Section 8.02 A 2, as are provided for in the FF&E Estimate approved for such Fiscal Year by TRS pursuant to Section 8.02 Camounts, provided that Management Company shall not expend more than such application satisfies the balance in the Reserve without the prior approval requirements of TRS. Management Company will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom (but not exceeding the Reserve balance), in its reasonable discretion, provided that (a) such departures from the FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (b) such departures from the FF&E Estimate result from circumstances which require prompt repair and/or replacement; and (c) Management Company has submitted to TRS a revised FF&E Estimate setting forth and explaining such departures. At the end of each Fiscal Year, any amounts then remaining in the Reserve shall be carried forward to the next Fiscal Year. E. If any FF&E Estimate which is prepared for a given Fiscal Year would require funding in excess of the percentage of Gross Revenues which is required under Section 8.02A, TRS may either (i) agree to increase the percentage of Gross Revenues up to the level set forth in such FF&E Estimate, in order to provide the additional funds required, such increases to be treated as Operating Expenses; or (ii) make a lump-sum contribution to the Reserve in the necessary amount, in which case such contribution plus interest (at Prime Rate plus one percentage point per annum) shall be reimbursed to TRS from Gross Revenues in equal installments over a period of time mutually agreed upon by TRS and Management Company, and such installment repayments shall be Operating Expenses. If TRS elects not to agree to either option for excess funding of the Reserve, Management Company shall be entitled, at its option, to terminate this Agreement upon ninety (90) days’ written notice to TRS; however, such failure by TRS shall not be deemed a Default by TRS unless such failure to provide excess funding will cause a default under the Franchise Agreement.Article

Repairs and Equipment Reserve. A. Management Company shall establish, in respect of each Fiscal Year from and after the Management Commencement Date, a reserve escrow account in the name of TRS (“Reserve”) in a bank approved by TRS. All disbursements and withdrawals from the Reserve shall be made by representatives of Management Company whose signatures have been authorized. The Reserve shall be in an amount equal to the greater of: (i) four percent (4%) of Gross Revenues; or (ii) the amount required under the Franchise Agreement for the Hotel or by any Qualified Lender. The Reserve shall be held in a bank, savings and loan association, or other financial institution designated by TRS to cover cost of: (i) Replacements and renewals to the Hotel's FF&E; and (ii) Certain non-routine repairs and maintenance to the Hotel building which are normally capitalized under generally accepted accounting principles, such as exterior and interior repainting, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like, but which are not major repairs, alterations, improvements, renewals, or replacements to the Hotel building's structure or to its mechanical, electrical, heating, ventilating, air conditioning, plumbing, or vertical transportation systems, the cost of which are TRS's sole responsibility under Section 8.03. B. All amounts from time to time in the Reserve, and all interest thereon, shall at all times be owned by, and be the exclusive property of, TRS, and Management Company shall make no claim thereto. Proceeds from the sale of FF&E no longer necessary for the operation of the Hotel shall be deposited in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither (i) proceeds from the disposition of FF&E, nor (ii) interest which accrues on amounts held in the Reserve shall (x) result in any reduction in the required contributions to the Reserve set forth in 8.02 A above, or (y) be included in Gross Revenues. Management Company shall provide to TRS each month a copy of the bank statement relating to the Reserve and a reconciliation of such Reserve account. C. Management Company shall prepare an estimate (“FF&E Estimate”) of the expenditures necessary during the ensuing Fiscal Year for (i) replacement and renewal of the Hotel FF&E and (ii) building repairs of the nature contemplated by Section 8.02 A 2, and shall submit such FF&E Estimate to TRS for TRS's review and approval at the same time it submits the Preliminary Annual Operating Projection described in Section 9.03. D. Management Company shall from time to time make such substitutions and replacements of or renewals to FF&E and repairs to the Hotel of the nature described in Section 8.02 A 2, as are provided for in the FF&E Estimate approved for such Fiscal Year by TRS pursuant to Section 8.02 C, provided that Management Company shall not expend more than the balance in the Reserve without the prior approval of TRS. Management Company will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom (but not exceeding the Reserve balance), in its reasonable discretion, provided that (a) such departures from the FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (b) such departures from the FF&E Estimate result from circumstances which require prompt repair and/or replacement; and (c) Management Company has submitted to TRS a revised FF&E Estimate setting forth and explaining such departures. At the end of each Fiscal Year, any amounts then remaining in the Reserve shall be carried forward to the next Fiscal Year. E. If any FF&E Estimate which is prepared for a given Fiscal Year would require funding in excess of the percentage of Gross Revenues which is required under Section 8.02A, TRS may either (i) agree to increase the percentage of Gross Revenues up to the level set forth in such FF&E Estimate, in order to provide the additional funds required, such increases to be treated as Operating Expenses; or (ii) make a lump-sum contribution to the Reserve in the necessary amount, in which case such contribution plus interest (at Prime Rate plus one percentage point per annum) shall be reimbursed to TRS from Gross Revenues in equal installments over a period of time mutually agreed upon by TRS and Management Company, and such installment repayments shall be Operating Expenses. If TRS elects not to agree to either option for excess funding of the Reserve, Management Company shall be entitled, at its option, to terminate this Agreement upon ninety (90) days’ written notice to TRS; however, such failure by TRS shall not be deemed a Default by TRS unless such failure to provide excess funding will cause a default under the Franchise AgreementTRS.

Repairs and Equipment Reserve. A. Management Company Manager shall establish, in on a consolidated basis (or on such other basis as may be reasonably required by lenders providing financing to Lessee or Owner with respect of each Fiscal Year from to the Inns), an escrow reserve account ("Repairs and after Equipment Reserve" or the Management Commencement Date"Reserve"), a reserve escrow account in the name of TRS (“Reserve”) in a bank approved by TRS. All disbursements or similar institution reasonably acceptable to both Manager and withdrawals from the Reserve shall be made by representatives of Management Company whose signatures have been authorized. The Reserve shall be in an amount equal to the greater of: (i) four percent (4%) of Gross Revenues; or (ii) the amount required under the Franchise Agreement for the Hotel or by any Qualified Lender. The Reserve shall be held in a bankLessee, savings and loan association, or other financial institution designated by TRS to cover the cost of: (i) 1. Replacements and renewals related solely to the Hotel's FF&EFF&E of the Inns; and (ii) 2. Certain non-routine repairs and maintenance to the Hotel building each Inn's Building which are normally capitalized under generally accepted accounting principles, such as exterior and interior repainting, ; resurfacing building walls, floors, roofs and parking areas, ; buying or leasing replacement vehicles; and replacing folding walls and the like, but which are not major repairs, alterations, improvements, renewals, renewals or replacements to the Hotel buildingsuch Building's structure or to its mechanical, electrical, heating, ventilating, air conditioning, plumbing, plumbing or vertical transportation systems, the cost of which are TRS's sole responsibility to be paid by Lessee under Section 8.037.03, rather than from the Reserve. B. All amounts from Each Fiscal Year, subject to the provisions of subsection E below, Manager shall transfer into the Reserve an amount equal to five percent (5%) of Gross Revenues. Transfers into the Reserve shall be made at the time of each interim accounting described in Section 5.04.A hereof. Commencing with Fiscal Year 2001, Manager shall have the right, but not the obligation, to time in increase the Reserveamount it transfers into the Reserve to any amount greater than five percent (5%) but not exceeding six percent (6%) of Gross Revenues for such Fiscal Year and successive Fiscal Year thereafter if, and all interest thereon, shall at all times be owned by, and be the exclusive property of, TRS, and Management Company shall make no claim thereto. Proceeds from the sale based upon a review of Replacement FF&E no longer necessary requirements for the operation of Inns, such increase is necessary in Manager's reasonable judgment to fund future Replacement FF&E that would be necessary to maintain the Hotel shall be deposited Inns in the Reserve, as shall any interest which accrues on amounts placed in the Reserveaccordance with Manager's standards for Residence Inns. Neither (i) proceeds from the disposition of FF&E, nor (ii) interest which accrues on Any amounts held in the Reserve shall (x) result in any reduction in may be applied, as between the required contributions Inns, without regard to the Reserve set forth in 8.02 A above, or (y) be included in Gross Revenues. Management Company shall provide to TRS each month a copy of the bank statement relating to the Reserve and a reconciliation source of such Reserve account. C. Management Company shall prepare an estimate (“FF&E Estimate”) of the expenditures necessary during the ensuing Fiscal Year for (i) replacement and renewal of the Hotel FF&E and (ii) building repairs of the nature contemplated by Section 8.02 A 2, and shall submit such FF&E Estimate to TRS for TRS's review and approval at the same time it submits the Preliminary Annual Operating Projection described in Section 9.03. D. Management Company shall from time to time make such substitutions and replacements of or renewals to FF&E and repairs to the Hotel of the nature described in Section 8.02 A 2, as are provided for in the FF&E Estimate approved for such Fiscal Year by TRS pursuant to Section 8.02 Camounts, provided that Management Company shall not expend more than such application satisfies the balance in the Reserve without the prior approval requirements of TRS. Management Company will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom (but not exceeding the Reserve balance), in its reasonable discretion, provided that (a) such departures from the FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (b) such departures from the FF&E Estimate result from circumstances which require prompt repair and/or replacement; and (c) Management Company has submitted to TRS a revised FF&E Estimate setting forth and explaining such departures. At the end of each Fiscal Year, any amounts then remaining in the Reserve shall be carried forward to the next Fiscal Year. E. If any FF&E Estimate which is prepared for a given Fiscal Year would require funding in excess of the percentage of Gross Revenues which is required under Section 8.02A, TRS may either (i) agree to increase the percentage of Gross Revenues up to the level set forth in such FF&E Estimate, in order to provide the additional funds required, such increases to be treated as Operating Expenses; or (ii) make a lump-sum contribution to the Reserve in the necessary amount, in which case such contribution plus interest (at Prime Rate plus one percentage point per annum) shall be reimbursed to TRS from Gross Revenues in equal installments over a period of time mutually agreed upon by TRS and Management Company, and such installment repayments shall be Operating Expenses. If TRS elects not to agree to either option for excess funding of the Reserve, Management Company shall be entitled, at its option, to terminate this Agreement upon ninety (90) days’ written notice to TRS; however, such failure by TRS shall not be deemed a Default by TRS unless such failure to provide excess funding will cause a default under the Franchise Agreement.Article

Repairs and Equipment Reserve. A. Management Company shall establish, in respect of each Fiscal Year from and after the Management Commencement Date, a reserve escrow account in the name of TRS Owner (“Reserve”) in a bank approved by TRSOwner. All disbursements and withdrawals from the Reserve shall be made by representatives of Management Company whose signatures have been authorized. The Reserve shall be in an amount equal to the greater of: (i) four percent (4%) % of Gross Revenues; Revenues or (ii) the amount required under the Franchise Agreement for the Hotel or by any Qualified Lender. The Reserve shall be held , in a bank, savings and loan association, association or other financial institution designated by TRS Owner to cover the cost of: (i) 1. Replacements and renewals to the Hotel's ’s FF&E; and (ii) 2. Certain non-routine repairs and maintenance to the Hotel building which are normally capitalized under generally accepted accounting principlesGAAP, such as exterior and interior repainting, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like, but which are not major repairs, alterations, improvements, renewals, renewals or replacements to the Hotel building's ’s structure or to its mechanical, electrical, heating, ventilating, air conditioning, plumbing, plumbing or vertical transportation systems, the cost of which are TRS's Owner’s sole responsibility under Section 8.03. B. All amounts from time to time in the Reserve, and all interest thereon, shall at all times be owned by, and be the exclusive property of, TRSOwner, and Management Company shall make no claim thereto. Proceeds from the sale of FF&E that is no longer necessary for the operation of the Hotel shall be deposited in the Reserve, as shall any interest which accrues on amounts placed in the Reserve. Neither (i) proceeds from the disposition of any FF&E, nor (ii) interest which accrues on amounts held in the Reserve Reserve, shall either (x) result in any reduction in the required contributions to the Reserve set forth in 8.02 A above, or (y) be included in Gross Revenues. Management Company shall provide to TRS Owner each month a copy of the bank statement relating to the Reserve and a reconciliation of such Reserve account. C. Management Company shall prepare an estimate (“FF&E Estimate”) of the expenditures necessary during the ensuing Fiscal Year for (i) replacement and renewal of the Hotel FF&E and (ii) building repairs of the nature contemplated by Section 8.02 A 22 during the ensuing Fiscal Year, and shall submit such FF&E Estimate to TRS Owner for TRS's Owner’s review and approval at the same time it submits the Preliminary Annual Operating Projection described in Section 9.03. D. Management Company shall from time to time make such substitutions and replacements of or renewals to FF&E and repairs to the Hotel of the nature described in Section 8.02 A 2, as are provided for in the FF&E Estimate approved for such Fiscal Year by TRS Owner pursuant to Section 8.02 C, provided that Management Company shall not expend more than the balance in the Reserve without the prior approval of TRSOwner. Management Company will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom (but not exceeding the Reserve balance), in its reasonable discretion, provided that (a) such departures from the FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (b) such departures from the FF&E Estimate result from circumstances which require prompt repair any of the following: emergency circumstances; applicable legal requirements; the terms of any Franchise Agreement; and/or replacementany other requirements for the continued safe and orderly operation of the Hotel; and (c) Management Company has submitted to TRS Owner a revised FF&E Estimate setting forth and explaining such departures. At the end of each Fiscal Year, any amounts then remaining in the Reserve shall be carried forward to the next Fiscal Year. E. If any FF&E Estimate which is prepared for a given Fiscal Year would require funding in excess of the percentage of Gross Revenues which is required under Section 8.02A8.02 A, TRS Owner may either elect one of the following: (i) agree to increase the percentage of Gross Revenues up to the level set forth in such FF&E Estimate, in order to provide the additional funds required, such increases to be treated as Operating ExpensesDeductions; or (ii) make a lump-sum contribution to the Reserve in the necessary amount and agree not to have such contribution reimbursed from Gross Revenues (in which case the amount of such contribution shall be added to Additional Invested Capital if the same falls within the definition of that term as set forth above); and (iii) make a lump-sum contribution to the Reserve in the necessary amount, in which case such contribution plus interest (at Prime Rate plus one percentage point per annum) ), shall be reimbursed to TRS Owner from Gross Revenues in equal installments over a period of time mutually agreed upon by TRS Owner and Management Company, and such installment repayments shall be Operating ExpensesDeductions. If TRS Owner elects not to agree to either option any of such options for excess funding of the Reserve, Management Company shall be entitled, at its option, to terminate this Agreement upon ninety (90) days’ written notice to TRSOwner; however, such failure by TRS Owner shall not be deemed a Default by TRS Owner unless such failure to provide excess funding will cause a default by Owner under the Franchise Section 16.01.F of this Agreement.

Repairs and Equipment Reserve. A. Management Company shall establishTenant shall, in respect on behalf of each Fiscal Year from and after the Management Commencement DateLandlord, a reserve establish an escrow account in ("Repairs and Equipment Reserve" or the name of TRS (“"Reserve”") in a bank approved selected by TRS. All disbursements and withdrawals from the Reserve Tenant, subject to Landlord's approval, which shall be made by representatives of Management Company whose signatures have been authorized. The Reserve shall be funded as set forth in an amount equal to the greater of: (i) four percent (4%) of Gross Revenues; or (ii) the amount required under the Franchise Agreement for the Hotel or by any Qualified Lender. The Reserve shall be held in a banksubsection B hereof, savings and loan association, or other financial institution designated by TRS to cover the cost of: (i) 1. Replacements and renewals to the furniture, furnishings, fixtures and equipment ("FF&E") of the Hotel's FF&E; and (ii) 2. Certain non-routine repairs and maintenance to the Hotel building which are normally capitalized under generally accepted accounting principles, principles such as exterior and interior repainting, resurfacing building walls, floors, roofs and parking areas, and replacing folding walls and the like, but which are not major repairs, alterations, improvements, renewals, renewals or replacements to the Hotel building's structure or to its mechanical, electrical, heating, ventilating, air conditioning, plumbing, plumbing or vertical transportation systems, the cost of which are TRSLandlord's sole responsibility under Section 8.039.03. B. All amounts from time to time For the first Fiscal Year after the Opening Date, Tenant shall, on behalf of Landlord, deposit in the ReserveReserve an amount equal to one percent (1%) of Gross Revenues; for the second Fiscal Year after the Opening Date, Tenant shall so transfer to the Reserve an amount equal to two percent (2%) of Gross Revenues; for the third through the fifth Fiscal Years after the opening Date, Tenant shall so transfer to the Reserve an amount equal to three percent (3%) of Gross Revenues for each such Fiscal Year; for the sixth through tenth Fiscal Years after the Opening Date, Tenant shall so transfer to the Reserve an amount equal to four percent (4%) of Gross Revenues for each such Fiscal Year; commencing with the eleventh Fiscal Year after the Opening Date and for all Fiscal Years thereafter, subject to the provisions of subsection F, below, Tenant shall so transfer to the Reserve an amount equal to five percent (5%) of Gross Revenues for each such Fiscal Year. All such transfers shall take place with respect to each Accounting Period, on a pro rata basis, as set forth in Section 5.02 A, and all interest thereonshall be accounted for cumulatively and adjusted at the close of each Fiscal Year. Any amount remaining in the Repairs and Equipment Reserve upon Termination shall be paid to Landlord. For the purposes of this Lease, funds deposited into the Repairs and Equipment Reserve shall at all times be owned by, and be the exclusive property of, TRS, and Management Company shall make no claim thereto. Proceeds additional rental to Landlord. C. Any proceeds from the sale of FF&E no longer necessary for to the operation of the Hotel shall be deposited in credited to the Repairs and Equipment Reserve, as . Any interest paid upon such account shall any interest which accrues on amounts placed in also be credited to the Reserve. Neither (i) proceeds from the disposition of FF&E, nor (ii) interest which accrues on amounts held in the Reserve shall (x) result in any reduction in the required contributions The amount that would otherwise be transferred to the Reserve set forth in 8.02 A above, or (y) any given Fiscal Year shall be included in Gross Revenues. Management Company shall provide to TRS each month a copy of the bank statement relating to the Reserve and a reconciliation of such Reserve account.reduced by amounts so credited under this subsection C. C. Management Company D. Each Fiscal Year Tenant shall prepare an estimate (“the "FF&E Estimate”") of the expenditures necessary during for the ensuing Fiscal Year for (i) replacement of FF&E, as well as the non-routine repairs and renewal of the Hotel FF&E and (ii) building repairs of the nature contemplated by maintenance described in Section 8.02 A 2, during the next Fiscal Year and shall submit such FF&E Estimate to TRS for TRS's review and approval Landlord at the same time as it submits the Preliminary Annual Operating Projection described in Section 9.03. D. Management Company E. Tenant shall from time to time make such substitutions and replacements of or renewals to FF&E FF&E, as well as the non-routine repairs and repairs to the Hotel of the nature maintenance described in Section 8.02 A 2, as are provided for it deems necessary up to the balance in the Repairs and Equipment Reserve. No expenditures will be made from the Reserve other than in accordance with the preceding sentence. To the extent reasonably feasible Tenant will follow the FF&E Estimate approved for such Fiscal Year by TRS pursuant to Section 8.02 C, provided that Management Company shall not expend more than in making such expenditures. No expenditures will be made in excess of the balance in the Reserve without the prior approval of TRS. Management Company will endeavor to follow the applicable FF&E Estimate, but shall be entitled to depart therefrom (but not exceeding the Reserve balance), in its reasonable discretion, provided that (a) such departures from the FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Estimate; and (b) such departures from the FF&E Estimate result from circumstances which require prompt repair and/or replacement; and (c) Management Company has submitted to TRS a revised FF&E Estimate setting forth and explaining such departuresLandlord. At the end of each Fiscal Year, any amounts then remaining in the Reserve shall be carried forward to the next Fiscal Year. E. If any FF&E Estimate which is prepared for a given Fiscal Year would require funding in excess of the percentage F. The annual percentages of Gross Revenues which is required under to be placed in the Repairs and Equipment Reserve as set forth in Section 8.02A8.02 B are estimates based upon Tenant's prior experience with new properties. If, TRS in good faith, Tenant feels at any time during the term of this Lease that such percentages have become excessive given the needs of the Hotel, such percentages will be reduced to such amounts as Tenant deems reasonably necessary for the proper operation of the Hotel. On the other hand, as the Hotel ages, these percentages may either (i) agree not be sufficient to maintain the Hotel as a first-class hotel and, therefore, if, in any given Fiscal Year, the FF&E Estimate prepared in good faith by Tenant exceeds available funds in the Repairs and Equipment Reserve, Landlord will either: 1. Agree to increase the percentage annual percentages of Gross Revenues up contributed to the level set forth in such FF&E Estimate, in order Reserve to provide the additional funds required, or 2. Obtain financing for the additional funds required; in such increases to be treated as Operating Expenses; or event, the principal and interest payments (ii) make a lump-sum contribution to the Reserve in the necessary amount, in which case such contribution plus interest (at Prime Rate plus one percentage point per annum) shall be reimbursed to TRS from Gross Revenues in equal installments over on a period of time mutually agreed upon by TRS and Management Company, and such installment repayments shall be Operating Expenses. If TRS elects not to agree to either option for excess funding of the Reserve, Management Company shall be entitled, at its option, to terminate this Agreement upon ninety (90) days’ written notice to TRS; however, such failure by TRS shall not be deemed a Default by TRS unless such failure to provide excess funding will cause a default under the Franchise Agreement.commercially reasonable amortization

Repairs and Equipment Reserve. A. Management Company shall establishTenant shall, on behalf of Landlord and in Landlord's name but with Tenant having the sole authority to make withdrawals or transact other business with respect of each Fiscal Year from thereto, establish and after maintain, an escrow reserve account (the Management Commencement Date, a reserve escrow account in "Repair and Equipment Reserve" or the name of TRS (“"Reserve”") in a bank approved designated by TRS. All disbursements and withdrawals from the Reserve shall be made by representatives of Management Company whose signatures have been authorizedLandlord. The Reserve shall be in an amount equal to the greater of: (i) four percent (4%) of Gross Revenues; or (ii) the amount required under the Franchise Agreement for the Hotel or by any Qualified Lender. The Reserve shall be held in a bank, savings and loan association, or other financial institution designated by TRS used to cover the cost of FF&E Replacements consisting of: (i) 1. Replacements and renewals related solely to the Hotel's FF&E; andFF&E of the Hotel (including communication systems and computer systems); (ii) 2. Certain non-routine repairs and maintenance to the Hotel building structures of the Hotel, the cost of which are is normally capitalized under generally accepted accounting principles, such as exterior and interior repainting, resurfacing building walls, floors, roofs roofs, and parking areas, and replacing folding walls and the like, but which are not major repairs, alterations, improvements, renewals, or replacements to the Hotel building's structure of the building or to its mechanical, electrical, heating, ventilating, air conditioning, plumbing, or vertical transportation systems, the cost of which are TRSLandlord's sole responsibility under Section 8.03; and 3. Lease payments for any FF&E and motor vehicles that are leased instead of purchased and not treated as Deductions pursuant to Item 16 of the definition of Deductions. B. All As of the Effective Date, Landlord and Tenant shall make the Initial Reserve Deposit into the Reserve. Except as provided below and subject to the provisions of Section 8.02.E, for each Fiscal Year during the term of this Agreement, Tenant shall transfer into the Reserve an amount equal to five percent (5%) of Gross Revenues attributable to the Hotel for such period of time. Notwithstanding the foregoing, no deduction and transfer into the Reserve will be required to the extent that such deduction and transfer, when added to amounts from time to time already in the Reserve, and all interest thereon, shall at all times be owned by, and be would make the exclusive property of, TRS, and Management Company shall make no claim thereto. Proceeds from then balance exceed the sale gross amount of FF&E no longer necessary the transfers for the operation of the Hotel shall be deposited in the Reserve, as shall any previous eight (8) Fiscal Years. Any interest which accrues on amounts placed in the Reserve. Neither (i) proceeds from the disposition of FF&E, nor (ii) interest which accrues on any amounts held in the Reserve shall (x) result in any be retained therein without reduction of Tenant's obligation to make transfers thereto. All amounts held in the required contributions Reserve shall belong to the Reserve set forth in 8.02 A above, or (y) be included in Gross Revenues. Management Company shall provide to TRS each month a copy of the bank statement relating to the Reserve and a reconciliation of such Reserve accountLandlord. C. Management Company shall prepare an estimate (“FF&E Estimate”) Tenant shall, on behalf of the expenditures necessary during the ensuing Fiscal Year for (i) replacement Landlord and renewal of the Hotel FF&E and (ii) building repairs of the nature contemplated by Section 8.02 A 2as Landlord's agent with respect to such obligation, and shall submit such FF&E Estimate to TRS for TRS's review and approval at the same time it submits the Preliminary Annual Operating Projection described in Section 9.03. D. Management Company shall from time to time make such substitutions (i) replacements and replacements of or renewals to FF&E the Hotel's FF&E, and (ii) repairs to the Hotel of the nature described in Section 8.02 A 28.02.A.2, as are provided for it deems necessary, and (iii) lease payments as described in the FF&E Estimate approved for such Fiscal Year by TRS pursuant Section 8.02.A.3 [as it deems necessary], up to Section 8.02 C, provided that Management Company shall not expend more than the balance in the Reserve Reserve. No expenditures will be made other than as set forth in the approved Repairs and Equipment Estimate and in no event may expenditures be made in excess of such balance without the prior approval of TRS. Management Company will endeavor Landlord; provided, however, that (1) Tenant may effect emergency repairs necessary to follow the applicable FF&E Estimateprevent further loss or damage without such approval, but shall be entitled to depart therefrom and (but not exceeding the Reserve balance)2) Tenant may, in its reasonable sole discretion, expend up to ten thousand dollars ($10,000) (as adjusted upward each Fiscal Year to reflect the percentage increase in the CPI announced for November of the immediately preceding Fiscal Year over the CPI announced for December 1993, provided that (aif such percentage increase is a negative number in any given Fiscal Year, then there shall be no increase in such amount over the previous Fiscal Year) such departures from in each Fiscal Year for matters not contemplated in the FF&E Estimate result from circumstances which could not reasonably have been foreseen at the time of the submission of such FF&E Repairs and Equipment Estimate; and (b) such departures from the FF&E Estimate result from circumstances which require prompt repair and/or replacement; and (c) Management Company has submitted to TRS a revised FF&E Estimate setting forth and explaining such departures. At the end of each Fiscal Year, any amounts then remaining in the Reserve shall be carried forward to the next Fiscal Year. Proceeds from the sale of FF&E no longer necessary to the operation of the Hotel shall be deposited in the Reserve without reduction of Tenant's obligation to make transfers thereto. Expenditures made by Tenant out of the Reserve for replacements and renewals to the Hotel's FF&E, repairs to the Hotel of the nature described in Section 8.02.A.2, and lease payments as described in Section 8.02.A.3 shall not also be treated as Deductions. Upon Termination of this Agreement and after payment by Tenant of all charges properly payable out of the Reserve, Tenant shall pay to Landlord all amounts held in the Reserve unless Tenant will continue operating the Hotel, in which case Tenant shall transfer all amounts held in the Reserve to one or more new accounts for the benefit of the new owner of the Landlord's interest in the Hotel. If for any reason Tenant is prohibited, in contradiction to the terms stated above, from transferring such Reserve funds to one or more new accounts for the benefit of the new landlord(s), then Tenant shall be entitled, in addition to the transfers into the Reserve provided in Section 8.02.B, to transfer from Gross Revenues into the new Reserve account an amount equal to Twenty Thousand, Four Hundred Dollars ($20,400). Tenant, in its sole but reasonable discretion, and subject to the exceptions stated below, shall decide whether to purchase or lease any replacement FF&E or motor vehicles used in transporting Hotel guests. If Tenant enters into any lease of replacement FF&E or motor vehicles used in transporting Hotel guests, it shall do so on Landlord's behalf and as Landlord's agent; or, upon Tenant's recommendation and request, Landlord shall directly enter into such leases. Notwithstanding the foregoing, Tenant shall not and shall not require Landlord to enter into any lease other than (i) Telephone Leases, (ii) Computer Leases, (iii) TV System Leases, (iv) FF&E Leases, and (v) leases of vehicles used in transporting Hotel guests. With respect to FF&E Leases only, Tenant shall be required to obtain Landlord's prior written approval before entering into or requesting that Landlord enter into any FF&E Lease, if (a) the fair market value of the FF&E with respect to the FF&E Leases relating to the Hotel would exceed at any time $200,000 in the aggregate (b) the FF&E to be covered by such FF&E Lease is FF&E that is not customarily leased in the hotel industry in the United States, or (c) such FF&E Lease is on payment terms (including amount and time of payment) materially more favorable to the lessor thereof than payment terms customary in the hotel industry in the United States for similar leases. With respect to TV System Leases only, Tenant shall be required to obtain Landlord's prior written approval before entering into or requesting the Landlord enter into any TV System Lease, if (a) the equipment to be covered by such TV System Lease is not customarily leased in the hotel industry in the United States or (b) such TV System Lease is on payment terms (including amount and time of payment) materially more favorable to the lessor thereof than payment terms customary in the hotel industry in the United States for similar leases. In cases described in the preceding two sentences, Landlord's approval shall not be unreasonably withheld; provided, however, that the failure of Lenders to approve such leasing proposal shall justify Landlord in withholding its approval. D. Tenant shall annually prepare a written estimate (the "Repairs and Equipment Estimate") for FF&E Replacements necessary for the forthcoming Fiscal Year and shall submit the Repairs and Equipment Estimate to Landlord at the same time it submits the Annual Operating Projection described in Section 9.03. The Repairs and Equipment Estimate shall indicate the estimated time schedule for making such replacements and renewals. Landlord shall review the Repairs and Equipment Estimate submitted in good faith by Tenant. If Landlord shall fail to approve such Repairs and Equipment Estimate within thirty (30) days of the receipt thereof, or if Tenant does not agree to any modifications made by Landlord within fifteen (15) days after such modifications are suggested, Tenant shall have the option of terminating this Agreement by giving written notice to Landlord within 30 days thereafter, such termination to be effective 60 days after the giving of such termination notice (or such later time as may be required to avoid liability under the WARN Act or any similar law). If Tenant does not so notify Landlord, it shall continue to occupy and operate the Hotel as provided under this Agreement without making the FF&E Replacements to which Landlord did not agree. E. If any FF&E Estimate which is prepared The percentage contributions for a given Fiscal Year would require funding the Reserve described in excess Section 8.02.B are estimates. As the Hotel ages, these percentages may not be sufficient to keep the Reserve at the levels necessary to make the replacements and renewals to the Hotel's FF&E, or to make the repairs to the Hotel buildings of the percentage of Gross Revenues which is nature described in Section 8.02.A.2, required under Section 8.02Ato maintain the Hotel in first-class condition. If the Repairs and Equipment Estimate prepared in good faith by Tenant exceeds the available funds in the Reserve, TRS may either (i) agree Landlord shall: 1. Agree to increase the annual percentage of Gross Revenues up to the level set forth in such FF&E Estimate, in order Section 8.02.B to provide the additional funds required, such increases to be treated as Operating Expenses; or (ii) make a lump-sum contribution to or 2. Provide outside financing for the Reserve in the necessary amountadditional funds required, in which case event the principal and interest payments on such contribution plus interest financing (at Prime Rate plus one percentage point per annumbut not the expenditure of such additional funds from the Reserve after their deposit into the Reserve) shall be reimbursed to TRS from Gross Revenues in equal installments over a period of time mutually agreed upon constitute Deductions. A failure or refusal by TRS and Management Company, and such installment repayments shall be Operating Expenses. If TRS elects not Landlord to agree to either option for excess funding of the Reserve1 or 2 above within a sixty (60) day period after Tenant's request therefor shall entitle Tenant, Management Company shall be entitled, at its optionwithin thirty (30) days thereafter, to notify Landlord that it will terminate this Agreement upon ninety if agreement was not reached as of a date six (906) days’ written notice to TRS; however, such failure by TRS shall not be deemed a Default by TRS unless such failure to provide excess funding will cause a default under months after the Franchise Agreementdate of Tenant's notice.