GAYLORD ENTERTAINMENT CO /DE
MEZZANINE LOAN AGREEMENT
<DOCUMENT>
<TYPE>EX-10.14
<SEQUENCE>6
<FILENAME>g68099ex10-14.txt
<DESCRIPTION>MEZZANINE LOAN AGREEMENT
<TEXT>

<PAGE>   1
                                                                   EXHIBIT 10.14




                            MEZZANINE LOAN AGREEMENT

                           Dated as of March 27, 2001

                                 by and between


                                OHN HOLDINGS, LLC

                              as Mezzanine Borrower

                                       and

                      MERRILL LYNCH MORTGAGE CAPITAL INC.,

                               as Mezzanine Lender


<PAGE>   2


                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                            PAGE
                                                                                            ----
<S>                                                                                          <C>
ARTICLE I           CERTAIN DEFINITIONS.......................................................1
         Section 1.1.      Definitions........................................................1

ARTICLE II          GENERAL TERMS............................................................25
         Section 2.1.      Amount of the Mezzanine Loan......................................25
         Section 2.2.      Use of Proceeds...................................................25
         Section 2.3.      Security for the Mezzanine Loan...................................25
         Section 2.4.      Mezzanine Note....................................................25
         Section 2.5.      Principal and Interest Payments...................................25
         Section 2.6.      Voluntary Prepayment..............................................26
         Section 2.7.      Application of Payments...........................................27
         Section 2.8.      Payment of Debt Service, Method and Place of Payment..............27
         Section 2.9.      Taxes.............................................................27
         Section 2.10.     Servicing Fee and Other Fees......................................27
         Section 2.11.     Limitation of Interest............................................28
         Section 2.12.     Mandatory Prepayments; Cash Sweep Events..........................28
         Section 2.13.     Extension of Loan.................................................30

ARTICLE III         CONDITIONS PRECEDENT; AND THE ACCOUNTS...................................30
         Section 3.1.      Conditions Precedent to the Making of the Mezzanine Loan..........30
         Section 3.2.      Form of Mezzanine Loan Documents and Related Matters..............33
         Section 3.3.      The Accounts......................................................33
         Section 3.4.      Tax and Insurance Account.........................................35
         Section 3.5.      Contingent Reserve Accounts; Extraordinary Expenses Account.......36
         Section 3.6.      Cash Sweep Event Reserve Account..................................36
         Section 3.7.      Mezzanine Loan Debt Service Account...............................37
         Section 3.8.      Investment and Control of Accounts................................37
         Section 3.9.      Mezzanine Lender's Right to Cure First Mortgage Loan Defaults.....38
         Section 3.10.     Substitute Cash Management........................................39

ARTICLE IV          REPRESENTATIONS AND WARRANTIES...........................................39
         Section 4.1.      Representations and Warranties of Mezzanine Borrower..............39
         Section 4.2.      Survival of Representations and Warranties........................46

ARTICLE V           AFFIRMATIVE COVENANTS....................................................46
         Section 5.1.      Mezzanine Borrower Covenants......................................46
         Section 5.2.      Leases............................................................58
         Section 5.3.      Insurance; Coverages..............................................60
         Section 5.4.      Condemnation and Eminent Domain...................................66
         Section 5.5.      O&M Plan..........................................................67

ARTICLE VI          NEGATIVE COVENANTS.......................................................68
</TABLE>


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<TABLE>
<S>                                                                                         <C>
         Section 6.1.      Mezzanine Borrower Negative Covenants.............................68

ARTICLE VII         DEFAULTS.................................................................71
         Section 7.1.      Event of Default..................................................71
         Section 7.2.      Remedies..........................................................73
         Section 7.3.      Remedies Cumulative...............................................74
         Section 7.4.      Mezzanine Lender's Right to Perform...............................74

ARTICLE VIII        MISCELLANEOUS............................................................74
         Section 8.1.      Survival..........................................................74
         Section 8.2.      Mezzanine Lender's Discretion.....................................75
         Section 8.3.      Governing Law.....................................................75
         Section 8.4.      Modification, Waiver in Writing...................................76
         Section 8.5.      Delay Not a Waiver................................................76
         Section 8.6.      Notices...........................................................76
         Section 8.7.      TRIAL BY JURY.....................................................77
         Section 8.8.      Headings..........................................................77
         Section 8.9.      Assignment........................................................77
         Section 8.10.     Severability......................................................77
         Section 8.11.     Preferences.......................................................77
         Section 8.12.     Waiver of Notice..................................................78
         Section 8.13.     Remedies of Mezzanine Borrower....................................78
         Section 8.14.     Joint and Several Liability.......................................78
         Section 8.15.     Limited Recourse; Additional Indemnity Obligation.................78
         Section 8.16.     Exhibits Incorporated.............................................81
         Section 8.17.     Offsets, Counterclaims and Defenses...............................81
         Section 8.18.     No Joint Venture or Partnership...................................81
         Section 8.19.     Waiver of Marshaling of Assets Defense............................81
         Section 8.20.     Waiver of Counterclaim............................................82
         Section 8.21.     Conflict; Construction of Documents...............................82
         Section 8.22.     Brokers and Financial Advisors....................................82
         Section 8.23.     Counterparts......................................................82
         Section 8.24.     Payment of Expenses...............................................82
         Section 8.25.     Bankruptcy Waiver.................................................82
         Section 8.26.     Entire Agreement..................................................83
         Section 8.27.     Dissemination of Information......................................83
         Section 8.28.     Confidentiality...................................................83
         Section 8.29.     Indemnification...................................................84
         Section 8.30.     Mezzanine Borrower Acknowledgments................................86
         Section 8.31.     Publicity.........................................................86
         Section 8.32.     Cross Collateralization...........................................86
         Section 8.33.     Release...........................................................86
         Section 8.34.     Assignment by Mezzanine Lender; Participations; Securitization....87
         Section 8.35.     The Agent.........................................................90
</TABLE>



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<PAGE>   4
                            MEZZANINE LOAN AGREEMENT

                  THIS MEZZANINE LOAN AGREEMENT dated as of March 27, 2001, is
by and between MERRILL LYNCH MORTGAGE CAPITAL INC., a Delaware corporation,
having an address at Four World Financial Center, New York, New York 10080,
Attention: Mr. Steven Glassman ("Merrill Lynch"), and OHN HOLDINGS, LLC, a
Delaware limited liability company, having an address c/o 535 Marriott Drive,
Suite 600, Highland Ridge Tower, Nashville, Tennessee 37214, Attention: Glenn
Malone ("Mezzanine Borrower").

                                    RECITALS

                  WHEREAS, Mezzanine Borrower desires to obtain a loan (the
"Mezzanine Loan") from Mezzanine Lender (as hereinafter defined) in the original
principal amount of ONE HUNDRED MILLION AND NO/00 DOLLARS ($100,000,000.00) (the
"Mezzanine Loan Amount");

                  WHEREAS, Mezzanine Lender is willing to make the Mezzanine
Loan on the condition that Mezzanine Borrower joins in the execution and
delivery of this Agreement which shall establish the terms and conditions of the
Mezzanine Loan;

                  NOW, THEREFORE, in consideration of the making of the
Mezzanine Loan by Mezzanine Lender, and the covenants, agreements,
representations and warranties set forth in this Agreement, the parties hereby
covenant, agree, represent and warrant as follows:

                                   ARTICLE I

                               CERTAIN DEFINITIONS

                  Section 1.1. Definitions. For all purposes of this Agreement:

                  (a) the capitalized terms defined in this Article I have the
meanings assigned to them in this Article I, and include the plural as well as
the singular;

                  (b) all accounting terms have the meanings assigned to them in
accordance with GAAP;

                  (c) the words "herein", "hereof", and "hereunder" and other
words of similar import refer to this Agreement as a whole and not to any
particular Article, Section, or other subdivision; and

                  (d) the following terms have the following meanings:

                  "Accounts" has the meaning set forth in Section 3.5.

                  "Account Property" means, collectively, all cash, Permitted
Investments and other Investment Property on deposit in or credited to the
Deposit Account.


<PAGE>   5

                  "Affiliate" of any specified Person means any Person
controlling, controlled by or under common control with such specified Person.
For the purposes of this Agreement, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities or other beneficial interests, by contract or otherwise; and the
terms "controls", "controlling" and "controlled" have the meanings correlative
to the foregoing.

                  "Agent" has the meaning set forth in Section 8.35.

                  "Agreement" means this Mezzanine Loan Agreement, as the same
may from time to time hereafter be modified, supplemented or amended.

                  "Approved FF&E Budget" has the meaning set forth in Section
5.1(j).

                  "Approved Operating Budget" has the meaning set forth in
Section 5.1(j).

                  "Assignee" has the meaning set forth in Section 8.34.

                  "Assignment and Acceptance" means an assignment and acceptance
entered into by Mezzanine Lender and an assignee and accepted by the Agent, in
the form of Exhibit E annexed hereto and made a part hereof, or any other form
approved by the Agent.

                  "Awards" has the meaning set forth in Section 5.4.

                  "Breach Period" means, with respect to any Payment Breach, the
period of time after the Payment Date on which the Payment Breach occurred
during which such Payment Breach continues.

                  "Business Day" means any day other than (i) a Saturday or a
Sunday, and (ii) a day on which federally insured depository institutions in New
York are authorized or obligated by law, regulation, governmental decree or
executive order to be closed.

                  "Capital Improvement Plan" means Mezzanine Borrower's current
plan and budget for certain ongoing multi-phased capital improvements to the
Property, including the renovation and improvement of certain guest rooms, the
main hotel lobby and other common areas, and elevators, escalators and other
building systems, which "Required Repairs" component has been approved by
Mezzanine Lender and a copy of which is attached as Exhibit F.

                  "Cash Sweep Event" has the meaning set forth in Section 2.12.

                  "Cash Sweep Event Notice" has the meaning set forth in Section
2.12.

                  "Cash Sweep Event Reserve Account" has the meaning set forth
in Section 3.3(c).

                  "Certificates" means the securities or participation interests
issued in respect of the First Mortgage Loan or a pool of mortgage loans which
includes the First Mortgage Loan.



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<PAGE>   6

                  "Chief Financial Officer" means the chief financial officer of
the Mezzanine Borrower.

                  "Claim" has the meaning set forth in Section 8.29.

                  "Closing Date" means the date of this Agreement.

                  "Code" means the Internal Revenue Code of 1986, as amended,
and as it may be further amended from time to time, any successor statutes
thereto, together with applicable U.S. Department of Treasury regulations issued
pursuant thereto in temporary or final form.

                  "Collateral" means, collectively, all property of any kind
whatsoever of Mezzanine Borrower, including, without limitation, the collateral
granted to Mezzanine Lender pursuant to the Equity Pledge Agreements, the
Accounts, and any collateral described in any Mezzanine Loan Document, and all
Proceeds and products of any of the foregoing, all whether now owned or
hereafter acquired, and all other property in which Mezzanine Borrower may now
or hereafter have an interest, excluding the Property.

                  "Collateral Security Instrument" means any right, document or
instrument given as security for the Mezzanine Loan, including, without
limitation, the Equity Pledge Agreements, in each case as the same may hereafter
from time to time be supplemented, amended, extended or modified by one or more
written agreements supplemental thereto.

                  "Combined Monthly Payment Amount" has the meaning provided in
Section 3.3(d).

                  "Contest" has the meaning set forth in Section 8.15.

                  "Contingent Obligation" means any obligation of Mezzanine
Borrower guaranteeing any indebtedness, leases, dividends or other obligations
("primary obligations") of any other Person (the "primary obligor") in any
manner, whether directly or indirectly, including, without limitation, any
obligation of Mezzanine Borrower, whether or not contingent; (i) to purchase any
such primary obligation, or any property constituting direct or indirect
security therefor; (ii) to advance or supply funds (x) for the purchase or
payment of any such primary obligation or (y) to maintain working capital or
equity capital of the primary obligor; (iii) to purchase property, securities or
services primarily for the purpose of assuring the owner or obligee under any
such primary obligation of the ability of the primary obligor to make payment of
such primary obligation; or (iv) otherwise to assure or hold harmless the owner
or obligee under such primary obligation against loss in respect thereof. The
amount of any Contingent Obligation shall be deemed to be an amount equal to the
stated or determinable amount of the primary obligation in respect of which such
Contingent Obligation is made or, if not stated or determinable, the maximum
anticipated liability in respect thereof (assuming that Mezzanine Borrower is
required to perform thereunder) as determined by Mezzanine Lender in good faith.

                  "Control Entity" means the corporation or other Person acting
as the managing general partner of any limited partnership or as the managing
member or non-member manager of any limited liability company, as applicable.
The Control Entity of Mezzanine Borrower is



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<PAGE>   7

OHN Holdings Management, Inc. and the Control Entity of the First Mortgage Loan
Borrower is OHN Management, Inc.

                  "De minimis Lease" means any Lease of space in the Property
with a Person that is not an Affiliate of Mezzanine Borrower, which provides for
annual rent or other payments in an amount less than $5,000 and which is
otherwise on arms-length terms and conditions.

                  "Debt" means, at any given time, the Principal Indebtedness,
together with all accrued and unpaid interest thereon and all other obligations
and liabilities due or to become due to Mezzanine Lender pursuant hereto, under
the Mezzanine Note or in accordance with any of the other Mezzanine Loan
Documents, and all other amounts, sums and expenses including without limitation
any Prepayment Fees paid by or payable to Mezzanine Lender which Mezzanine
Borrower is obligated to pay hereunder or pursuant to the Mezzanine Note or any
of the other Mezzanine Loan Documents.

                  "Debt Service" means, for any period, the principal, interest
payment, Default Rate interest and Late Charges that accrue or are due and
payable in accordance with the Mezzanine Loan Documents during such period.

                  "Debt Service Coverage Ratio" or "DSCR" means, for any period,
the ratio, expressed in decimals, obtained by dividing Pro Forma Net Operating
Income by the Pro Forma Debt Service.

                  "Debt Yield" means, for any period, the Pro Forma Net
Operating Income divided by the sum of the outstanding principal balances of the
First Mortgage Loan and Mezzanine Loan.

                  "Default" means the occurrence of any event which, but for the
giving of notice or the passage of time, or both, would be an Event of Default.

                  "Default Rate" means the per annum interest rate equal to the
lesser of (i) the Maximum Amount or (ii) the Interest Rate plus four percent
(4%).

                  "Deposit Account" has the meaning set forth in Section 3.3.

                  "Deposit Bank" has the meaning set forth in Section 3.3.

                  "Determination Date" means with respect to any Interest
Accrual Period, the date which is two (2) Eurodollar Business Days before the
commencement of such Interest Accrual Period.

                  "Documentation" has the meaning set forth in Section 3.4.

                  "Eligible Account" means (i) an account or accounts maintained
with a federal or state-chartered depository institution or trust company which
complies with the definition of Eligible Institution, (ii) a segregated trust
account or accounts maintained with the corporate trust department of a federal
depository institution or state-chartered depository institution subject to
regulations regarding fiduciary funds on deposit similar to Title 12 of the Code
of Federal



                                       4
<PAGE>   8

Regulations Section 9.10(b) which, in either case, has corporate trust powers,
acting in its fiduciary capacity or (iii) an account approved by the applicable
Rating Agencies rating the Certificates.

                  "Eligible Institution" with respect to Wells Fargo Bank,
National Association, shall mean that (i) the short-term unsecured debt
obligations of such Person are rated at least "A-1" by S&P, "P-1" by Moody's and
"F-l" by Fitch, if deposits are held by such Person for a period of less than
one month, or (ii) the long-term unsecured debt obligations of such Person are
rated at least "AA-" by S&P (or "A" if the short-term unsecured debt obligations
of such Person are rated at least "A-1"), "Aa3" by Moody's and "A" by Fitch, if
deposits are held by such Person for a period of one month or more; and with
respect to any other Person, shall mean that (i) the short-term unsecured debt
obligations of such Person are rated at least "A-1" by S&P, "P-1" by Moody's and
"F-l+" by Fitch, if deposits are held by such Person for a period of less than
one month, or (ii) the long-term unsecured debt obligations of such Person are
rated at least "AA-" by S&P, "Aa2" by Moody's and "AA" by Fitch, if deposits are
held by such Person for a period of one month or more.

                  "Engineering Report" means that certain (i) Report of Property
Condition Survey - Law Project #70224-0-0182-01-600 dated May 1, 2000 and (ii)
Report of Property Condition Survey - Law Project
#70224-0-0182-01-600/70224-1-0027-01-600 dated February 8, 2001, prepared for
First Mortgage Loan Borrower and Mezzanine Lender, by LawGibb Group.

                  "Entitlement Holder" has the meaning set forth in Section
8-102(a)(7) of the UCC.

                  "Entitlement Order" has the meaning set forth in Section
8-102(a)(8) of the UCC.

                  "Entity" means, with respect to any Person, (i) a corporation,
if such person is described as a corporation in this Agreement, (ii) limited
partnership, if such Person is described as a limited partnership in this
Agreement or (iii) limited liability company, if such Person is described as a
limited liability company in this Agreement.

                  "Environmental Indemnity" means that certain Environmental
Indemnity, Certification and Remediation Agreement dated as of the Closing Date
made by Mezzanine Borrower and Guarantor in favor of the Mezzanine Lender.

                  "Environmental Report" means that certain (i) Phase I
Environmental Site Assessment-Law Project #70224-1-0182-02-916 dated May 1,
2000, (ii) Addendum to Phase I ESA - Law Project #70224-1-0027-02-916 dated
February 9, 2001 and (iii) Addendum to Phase I ESA - Law Project
#70224-1-0027-02-916 dated February 16, 2001, prepared by LawGibb for First
Mortgage Loan Borrower and Mezzanine Lender.

                  "Equipment" means any furniture, fixtures, equipment or other
personal property located on the Property and owned by Mezzanine Borrower, First
Mortgage Loan Borrower, or any affiliate of either of them.



                                       5
<PAGE>   9

                  "Equity Pledge Agreements" means, collectively, the Membership
Interest Pledge Agreement and the Stock Pledge Agreement.

                  "ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated thereunder.
Section references to ERISA are to ERISA, as in effect at the date of this
Agreement and, as of the relevant date, any subsequent provisions of ERISA,
amendatory thereof, supplemental thereto or substituted therefor.

                  "ERISA Affiliate" means any corporation or trade or business
that is a member of any group of organizations (i) described in Section 414(b)
or (c) of the Code, of which Mezzanine Borrower is a member, and (ii) solely for
purposes of potential liability under Section 302(c)(I 1) of ERISA and Section
412(c)(I 1) of the Code and the lien created under Section 302(f) of ERISA and
Section 412(n) of the Code, described in Section 414(m) or (o) of the Code, of
which Mezzanine Borrower is a member.

                  "Eurodollar Business Day" means a Business Day on which banks
in the City of London, England are open for interbank or foreign exchange
transactions.

                  "Event of Default" has the meaning set forth in Section 7.1.

                  "Excess Cash Flow" means, for any period, the excess (if any)
of

                  (1) the total of all Receipts for such period;

                  over

                  (2) the total of the following for such period (calculated
without duplication):

                      (a) all First Mortgage Debt Service payable during such
period (including all sums required under the First Mortgage Loan Documents to
be deposited into reserve accounts); plus

                      (b) all Expenses paid during such period, other than (i)
expenses paid from funds in the reserve accounts under the First Mortgage Loan
Documents or Mezzanine Loan Documents and (ii) Management Fees paid during such
period under the Management Agreement approved by Mezzanine Lender; plus

                      (c) all Debt Service payable during such period; plus

                      (d) all payments permitted to be made during such period
on account of capital expenses including capital expenditures pursuant to the
Capital Improvement Plan incurred in accordance with the Mezzanine Loan Document
and not paid using funds from reserve accounts under the First Mortgage Loan
Documents or Mezzanine Loan Documents; plus

                      (e) all Management Fees payable during such period under
the Management Agreement; plus



                                       6
<PAGE>   10

                      (f) all deposits (if any) required to be made during such
period into the Tax and Insurance Account and other Accounts maintained under
the Mezzanine Loan Documents; plus

                      (g) all FF&E Expenses paid during such period other than
from funds in the reserve accounts under the First Mortgage Loan Documents; plus

                      (h) provided no Cash Sweep Event has occurred and is
continuing, Extraordinary Expenses to the extent not otherwise paid from
reserves which Mezzanine Lender has approved in writing.

                  "Expenses" means, with respect to the Property for any given
period, all expenses paid, accrued, or payable, as determined in accordance with
GAAP by Mezzanine Borrower or First Mortgage Loan Borrower, as the case may be,
during that period in connection with the operation of the Property, in each
case to be determined without duplication, including, without limitation:

                  1. expenses for cleaning, repair, maintenance, decoration and
painting of the Property (including, without limitation, parking lots and
roadways and including all "costs and expenses" by the USAH), net of any
insurance proceeds in respect of any of the foregoing;

                  2. wages (including overtime payments), benefits, payroll
taxes, Gratuities and all other related expenses for on-site personnel, up to
and including (but not above) the level of the on-site property manager, engaged
in the repair, operation and maintenance of the Property and service to tenants
and on-site personnel engaged in audit and accounting functions performed by
Mezzanine Borrower or First Mortgage Loan Borrower;

                  3. Management Fees and other costs required to be reimbursed
to Manager pursuant to the Management Agreement approved by the Mezzanine
Lender;

                  4. the cost of all electricity, oil, gas, water, steam, heat,
ventilation, air conditioning and any other energy, utility or similar item and
the cost of building and cleaning supplies;

                  5. rent, liability, casualty, fidelity, errors and omissions,
workmen's compensation and other required insurance premiums;

                  6. legal, accounting and other professional fees and expenses;

                  7. the cost (including leasing and financing) of all Equipment
to be used in the ordinary course of business, which is not capitalized in
accordance with GAAP;

                  8. real estate, personal property and other taxes;

                  9. advertising and other marketing costs and expenses;

                  10. casualty losses to the extent not reimbursed by an
independent third party;



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<PAGE>   11

                  11. any payments pursuant to any contractual agreement which
provides for the servicing, maintenance, normal replacement or repair (as
opposed to capital replacement or capital repair) of the Property.

                  Notwithstanding the foregoing, Expenses shall not include (i)
depreciation or amortization; (ii) interest, principal and fees under, and costs
and expense reimbursements of the Mezzanine Lender or the First Mortgage Lender
in administering, the Mezzanine Loan and the First Mortgage Loan; (iii) any
expenditure (including leasing and financing costs, leasing commissions, tenant
concessions and improvements, and replacement reserves) which is properly
treatable as a capital item under GAAP; or (iv) any expenditure that would
otherwise constitute an Expense to the extent such item is funded from any
reserve maintained under the First Mortgage Loan Documents or the Mezzanine Loan
Documents.

                  "Extension Fee" has the meaning set forth in Section 2.13.

                  "Extraordinary Expenses Subaccount" has the meaning set forth
in Section 3.3(c).

                  "Extraordinary Expense" shall mean any extraordinary operating
expense or capital expenditure not set forth in the Approved Operating Budget or
Approved FF&E Budget or in excess of the amount set forth therefor in the
Approved Operating Budget or Approved FF&E Budget then in effect for the
Property with respect to which the failure to perform would allow a tenant under
a Lease to withhold rent or which is required to perform emergency repairs or
alterations or to correct any unhealthy or unsafe condition at the Property.

                  "Financial Assets" has the meaning assigned to such term in
Section 8-102(a)(9) of the UCC.

                  "Financial Statements" means statements of operations and
retained earnings, statements of cash flow and balance sheets.

                  "Financial Covenant Breach" has the meaning set forth in
Section 2.12(a).

                  "First Mortgage" means that certain Amended and Restated Deed
of Trust, Security Agreement, Assignment of Leases and Rents and Fixture Filing
dated March 27, 2001, given by First Mortgage Loan Borrower to First Mortgage
Lender in the principal amount of $275,000,000, encumbering the Property, as the
same may be amended, modified or supplemented from time to time.

                  "First Mortgage Borrower Remainder Funds" has the meaning set
forth in Section 3.3(d).

                  "First Mortgage Debt Service" means for any period, principal,
interest and all other sums that accrue or become due and payable under the
First Mortgage Loan Documents with respect to such period.

                  "First Mortgage Lender" shall mean Merrill Lynch Mortgage
Lending, Inc. and its successors and assigns.



                                       8
<PAGE>   12

                  "First Mortgage Loan" means the loan in the original principal
amount of $275,000,000, funded by First Mortgage Lender to First Mortgage Loan
Borrower on or prior to the Closing Date.

                  "First Mortgage Loan Agreement" means that certain Amended and
Restated Loan Agreement dated March 27, 2001 between First Mortgage Loan
Borrower and First Mortgage Lender, as the same may be amended, modified or
supplemented from time to time.

                  "First Mortgage Loan Borrower" means Opryland Hotel Nashville,
LLC, a Delaware limited liability company, the borrower under the First Mortgage
Loan Documents.

                  "First Mortgage Loan Cash Management Agreement" has the
meaning set forth in Section 3.3(d).

                  "First Mortgage Loan Documents" means, collectively, the Loan
Documents (as defined in the First Mortgage Loan Agreement), as such documents
may be amended, modified or supplemented from time to time.

                  "First Mortgage Loan Monthly Payment Amount" means the
aggregate payment due and payable under the First Mortgage Loan Documents on an
applicable First Mortgage Loan Payment Date, including all required funding of
reserve accounts.

                  "First Mortgage Loan Payment Date" means the last day of each
calendar month occurring during the term of the First Mortgage Loan (or if such
last day is not a Business Day, the last day of such calendar month which is a
Business Day).

                  "Fiscal Year" means the 12-month period ending on December 31
of each year.

                  "FF&E" means all machinery, furniture, furnishings, equipment,
fixtures (including, without limitation, all heating, air conditioning,
plumbing, lighting, communications and elevator fixtures), inventory and
articles of personal property and accessions, renewals and replacements thereof
and substitutions therefor (including, without limitation, beds, bureaus,
chiffonniers, chests, chairs, desks, lamps, mirrors, bookcases, tables, rugs,
carpeting, drapes, draperies, venetian blinds, screens, paintings, hangings,
pictures, divans, couches, luggage carts, luggage racks, stools, sofas,
chinaware, linens, pillows, blankets, glassware, foodcarts, cookware, dry
cleaning facilities, dining room wagons, tools, keys or other entry systems,
bars, bar fixtures, liquor and drink dispensers, ice makers, radios, clock
radios, television sets, intercom and paging equipment, electric and electronic
equipment, dictating equipment, private telephone systems, medical equipment,
potted plants, heating, lighting and plumbing fixtures, fire prevention and
extinguishing apparatus, cooling and air-conditioning systems, elevators,
escalators, fittings, plants, apparatus, stoves, ranges, refrigerators, laundry
machines, tools, machinery, engines, dynamos, motors, boilers, incinerators,
switchboards, conduits, compressors, vacuum cleaning systems, floor cleaning,
waxing and polishing equipment, call systems, brackets, electrical signs, bulbs,
bells, fuel, conveyors, cabinets, lockers, shelving, spotlighting equipment,
dishwashers, garbage disposals, washer and dryers), other customary hotel
equipment and other tangible property of every kind and nature whatsoever owned
by Mezzanine Borrower or First Mortgage Loan Borrower, or in which Mezzanine
Borrower or First Mortgage Loan Borrower has or shall have an interest, now or
hereafter located at the Property, or appurtenant thereto, and useable in



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<PAGE>   13

connection with the present or future operation and occupancy of the Property
and all building equipment, material and supplies of any nature whatsoever owned
by Mezzanine Borrower or First Mortgage Loan Borrower, or in which Mezzanine
Borrower or First Mortgage Loan Borrower has or shall have an interest, now or
hereafter located at the Property, or appurtenant thereto, and useable in
connection with the present or future operation, enjoyment and occupancy of the
Property.

                  "FF&E Expenses" means the expenditures for such capital
repairs, maintenance, improvements and replacements of FF&E and other
expenditures for FF&E (consistent with the Approved FF&E Budget), covering the
planned FF&E expenditures for the period covered thereby.

                  "FF&E Reserve" has the meaning set forth in the Mezzanine
Deposit Account Agreement.

                  "Franchise Agreement" means any license or franchise agreement
concerning the operation of hotel/licenses or franchises at the Property between
First Mortgage Loan Borrower and any nationally recognized hotel franchisor
reasonably acceptable to Mezzanine Lender provided, however, that an Acceptable
Franchisor (as defined in the First Mortgage Loan Documents) shall be an
acceptable franchisor to Mezzanine Lender.

                  "GAAP" means generally accepted accounting principles
consistently applied in the United States of America as of the date of the
applicable financial report.

                  "Governmental Authority" means any national, federal, state,
regional or local government, or any other political subdivision of any of the
foregoing, in each case with jurisdiction over Mezzanine Lender, Mezzanine
Borrower, First Mortgage Borrower, Manager, the Collateral or the Property or
any Person with jurisdiction over Mezzanine Borrower, First Mortgage Borrower,
Manager, the Collateral or the Property exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government.

                  "Gratuities" means those tips and gratuities paid to employees
and staff of the Property.

                  "Guarantor" means Gaylord Entertainment Company, a Delaware
corporation.

                  "Guaranty" means that certain Guaranty of Recourse Obligations
dated as of the Closing Date, made by Guarantor, as guarantor, in favor of
Mezzanine Lender.

                  "Impositions" means all taxes (including, without limitation,
all real estate, ad valorem, sales (including those imposed on lease rentals),
use, single business, gross receipts, value added, intangible transaction
privilege, privilege, license or similar taxes), assessments, ground rents,
water, sewer or other rents and charges, excises, levies, fees (including,
without limitation, license, permit, inspection, authorization and similar
fees), and all other governmental charges, in each case whether general or
special, ordinary or extraordinary, foreseen or unforeseen, of every character
in respect of Mezzanine Borrower, First Mortgage Loan Borrower, the Collateral,
or the Property (including all interest and penalties thereon), which at any
time prior to, during or in respect of the term hereof may be assessed or
imposed on or in



                                       10
<PAGE>   14

respect of or be a lien upon (i) Mezzanine Borrower or First Mortgage Loan
Borrower, (including, without limitation, all income, franchise, single business
or other taxes imposed on Mezzanine Borrower or First Mortgage Borrower, for the
privilege of doing business in any jurisdiction) or Mezzanine Lender or (ii) the
Property or any of the Collateral or any part thereof. Nothing contained in this
Agreement shall be construed to require Mezzanine Borrower to pay (and
Impositions shall not include) any tax, assessment, levy or charge imposed on
Mezzanine Lender in the nature of a franchise, capital levy, estate,
inheritance, succession, income or net revenue tax.

                  "Improvements" means all buildings, structures, fixtures,
additions, enlargements, extensions, modification, repairs, replacements and
improvements of every kind and nature now or hereafter located on the Property.

                  "Indebtedness" of a Person, at a particular date, means the
sum (without duplication) at such date of (a) indebtedness or liability for
borrowed money, (b) obligations evidenced by bonds, debentures, notes or other
similar instruments, (c) obligations for the deferred purchase price of property
or services (including trade obligations), (d) obligations under letters of
credit, (e) obligations under acceptance facilities, (f) all guaranties,
endorsements (other than for collection or deposit in the ordinary course of
business) and other contingent obligations to purchase, to provide funds for
payment, to supply funds to invest in any Person, or otherwise to assure a
creditor against loss, (g) obligations secured by any Liens, whether or not the
obligations have been assumed (h) obligations under any lease which have been or
should be capitalized under GAAP and (i) any other obligations or liabilities of
any nature, whether absolute, accrued, contingent, liquidated, or otherwise and
whether due or to be due, asserted or unasserted, known or unknown.

                  "Indemnified Party" shall have the meaning set forth in
Section 8.29.

                  "Independent" means, when used with respect to any Person, a
Person who: (i) does not have any direct financial interest or any material
indirect financial interest in Mezzanine Borrower, First Mortgage Loan Borrower
or Manager or in any Affiliate of Mezzanine Borrower, First Mortgage Loan
Borrower or Manager, (ii) is not connected with Mezzanine Borrower, First
Mortgage Loan Borrower or Manager or any Affiliate of Mezzanine Borrower, First
Mortgage Loan Borrower or Manager, as an officer, employee, promoter,
underwriter, trustee, partner, member, manager, creditor, director or person
performing similar functions, and (iii) is not a member of the immediate family
of a Person defined in (i) or (ii) above.

                  "Independent Director" means, with respect to a corporation, a
duly appointed member of the board of directors of such corporation, reasonably
satisfactory to Mezzanine Lender, who shall not have been at the time of such
individual's appointment, and may not have been at any time during the preceding
five (5) years, and shall not be at any time while serving as Independent
Director: (i) a direct or indirect legal or beneficial owner of, or an officer,
director, attorney, counsel, partner, member or employee of, such corporation
(other than an Independent Director thereof) or any Affiliate thereof, (ii) a
customer or creditor of, or supplier or contractor to, or other person who
derives more than ten percent (10%) of its purchases or revenues from its
activities with such corporation or any Affiliate thereof, (iii) a person or
other entity controlling, controlled by or under common control with any such
direct or indirect legal or beneficial owner,



                                       11
<PAGE>   15

officer, director, attorney, counsel, partner, member, employee, customer,
creditor, contractor supplier or other Person, or (iv) a member of the immediate
family of any such direct or indirect legal or beneficial owner, officer,
director, attorney, counsel, partner, member, employee, customer, creditor,
contractor, supplier or other person. As used herein, the term "control" means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management, policies or activities or a person or entity,
whether through ownership of voting securities or other beneficial interest, by
contract or otherwise and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.

                  "Institutional Investor" means (i) a commercial bank organized
under the laws of the United States, or any State thereof, and having (x) total
assets in excess of $1,000,000,000 and (y) a combined capital and surplus of at
least $250,000,000; (ii) a commercial bank organized under the laws of any other
country which is a member of the Organization of Economic Cooperation and
Development ("OECD"), or a political subdivision of any such country, and having
(x) total assets in excess of $1,000,000,000 and (y) a combined capital and
surplus of at least $250,000,000, provided that such bank is acting through a
branch or agency located in the country in which it is organized or another
country which is also a member of OECD; (iii) an insurance company organized
under the laws of any State of the United States, or organized under the laws of
any country and licensed as an insurer by any State within the United States and
having admitted assets of at least $1,000,000,000; (iv) a nationally recognized
investment banking company, or an affiliate thereof (other than any Person which
is directly or indirectly an Affiliate of Mezzanine Borrower or Guarantor, or of
any member or partner of Mezzanine Borrower or Guarantor) organized under the
laws of any State of the United States, and licensed or qualified to conduct
such business under the laws of any such State and having (1) total assets of at
least $1,000,000,000 and (2) a net worth of at least $250,000,000; (v) a private
corporate or public pension or profit-sharing plan (or similar plan) or an
endowment fund for a college, university or private charitable foundation having
total assets in excess of $1,000,000,000; or (vi) any entity which is engaged in
the business of or organized for the purpose of acquiring ownership and other
interests in real estate or hotel assets (including, without limitation, direct
and beneficial ownership interests) or any entity that is itself, or is
controlled by or under common control with an entity which is a so-called
"opportunity fund", "hedge fund" or other similar investment fund and having
total assets in excess of $1,000,000,000 and being reasonably acceptable to the
Mezzanine Lender.

                  "Instructions" has the meaning set forth in Section 3.9(a).

                  "Instruments" means all instruments, chattel paper, documents
or other writings obtained by Mezzanine Borrower evidencing a right to payment,
including, without limitation, all notes, drafts, acceptances, documents of
title, and policies and certificates of insurance, including but not limited to,
liability, hazard, rental and credit insurance, guarantees and securities, now
or hereafter received by Mezzanine Borrower or in which Mezzanine Borrower has
or acquires an interest pertaining to the foregoing. In addition to the
foregoing, "Instruments" shall include the meaning given such term in the UCC.

                  "Insurance" has the meaning set forth in Section 5.3.



                                       12
<PAGE>   16

                  "Interest Accrual Period" means each period during which
interest at the Interest Rate shall be applicable to the Principal Indebtedness.
Each such period shall commence on and include a Payment Date and end on and
include the last day immediately preceding the next Payment Date. If the Closing
Date shall occur on a date other than a Payment Date, the first Interest Accrual
Period shall commence on and include the Closing Date and end on and include the
last day before the initial Payment Date. If the Closing Date shall occur on the
last day before the initial Payment Date, the first Interest Accrual Period
shall consist of a one (1) day period consisting of the Closing Date.

                  "Interest Rate" means a per annum interest rate equal to LIBOR
plus the LIBOR Spread, adjusted on the first (1st) day of each Interest Accrual
Period.

                  "Interest Rate Cap Agreement" has the meaning set forth in
Section 5.1(s).

                  "Investor" has the meaning provided in Section 8.27.

                  "Investment Property" has the meaning assigned to such term in
Section 9-115(1)(f) of the UCC.

                  "Knowledge" whenever in this Mezzanine Loan Agreement or any
of the Mezzanine Loan Documents, or in any document or certificate executed on
behalf of Mezzanine Borrower pursuant to this Agreement or any of the Mezzanine
Loan Documents, reference is made to the knowledge of Mezzanine Borrower, First
Mortgage Loan Borrower, Guarantor or any Control Entity (whether by use of the
words "knowledge" or "known", or other words of similar meaning, and whether or
not the same are capitalized), such shall be deemed to refer to the knowledge of
(i) the Chief Executive Officer of Guarantor, the Chief Financial Officer of
Guarantor, the President of Opryland Hospitality Group, the Chief Financial
Officer of Opryland Hospitality Group and the General Manager of the hotel
located at the Property; (ii) the individuals employed by any such party with
whom the persons mentioned in clause (i) above would reasonably be expected to
consult for information on the subject matter; and (iii) also to the knowledge
of the person signing such document or certificate.

                  "Late Charge" means the lesser of (i) five percent (5%) of any
delinquent amount and (ii) the maximum late charge permitted to be charged under
the laws of the State of New York.

                  "Leases" means any lease, tenancy, license, sublease,
assignment and/or other rental or occupancy agreement or other agreement or
arrangement (including, without limitation, any and all guaranties of any of the
foregoing) heretofore or hereafter entered into affecting the use, enjoyment or
occupancy of, or the conduct of any activity upon or in, the Property or any
portion thereof, including any extensions, renewals, modifications or amendments
thereof.

                  "Leasing Costs" means the costs incurred by First Mortgage
Loan Borrower with respect to tenant improvement costs and leasing commissions
payable in connection with Leases at the Property approved by Mezzanine Lender
(or deemed approved by Mezzanine Lender in accordance with the terms hereof) and
entered into after the Closing Date.



                                       13
<PAGE>   17

                  "Legal Requirements" means all statutes, laws, rules, orders,
regulations, ordinances, judgments, decrees and injunctions of Governmental
Authorities affecting First Mortgage Loan Borrower, Mezzanine Borrower, the
Mezzanine Loan Documents, the Collateral or any part thereof, enacted or entered
and in force as of the relevant date, and all Permits and regulations relating
thereto, and all covenants, agreements, restrictions and encumbrances contained
in any instruments, either of record or known to Mezzanine Borrower at any time
in force affecting the Collateral or any part thereof.

                  "Liabilities" has the meaning set forth in Section 8.34.

                  "LIBOR" means with respect to each Interest Accrual Period,
the rate for deposits in U.S. dollars for a one-month period that appears on
Telerate Page 3750 (or the successor thereto) as of 11:00 a.m., London, England
time, on the related Determination Date. If such rate does not appear on
Telerate Page 3750 as of 11:00 a.m., London, England time, on such Determination
Date, LIBOR shall be the arithmetic mean of the offered rates (expressed as a
percentage per annum) for deposits in U.S. dollars for a one-month period that
appear on the Reuters Screen LIBO Page as of 11:00 a.m., London, England time,
on such Determination Date, if at least two (2) such offered rates so appear. If
fewer than two such offered rates appear on the Reuters Screen LIBO Page as of
11:00 a.m., London, England time, on such Determination Date, Mezzanine Lender
shall request the principal London, England office of any four (4) major
reference banks in the London interbank market selected by Mezzanine Lender to
provide such bank's offered quotation (expressed as a percentage per annum) to
prime banks in the London interbank market for deposits in U. S. Dollars for a
one-month period as of 11:00 a.m., London, England time, on such Determination
Date. If at least two (2) such offered quotations are so provided, LIBOR shall
be the arithmetic mean of such quotations. If fewer than two such quotations are
so provided, Mezzanine Lender shall request any three major banks in New York
City selected by Mezzanine Lender to provide such bank's rate (expressed as a
percentage per annum) for loans in U.S. Dollars to leading European banks for a
one month period as of approximately 11:00 a.m., New York City time on the
applicable Determination Date. If at least two (2) such rates are so provided,
LIBOR shall be the arithmetic mean of such rates. If fewer than two (2) rates
are so provided, then LIBOR for the applicable Interest Accrual Period shall be
LIBOR that was in effect for the next preceding Interest Accrual Period. LIBOR
for any Interest Accrual Period shall be adjusted from time to time, by
increasing the rate thereof to compensate Mezzanine Lender for any aggregate
reserve requirements (including, without limitation, all basic, supplemental,
marginal and other reserve requirements and taking into account any transitional
adjustments or other scheduled changes in reserve requirements during any
Interest Accrual Period) which are required to be maintained by Mezzanine Lender
with respect to "Eurocurrency liabilities" (as presently defined in Regulation D
of the Board of Governors of the Federal Reserve System) of the same term under
Regulation D, or any other regulations of a Governmental Authority having
jurisdiction over Mezzanine Lender of similar effect, provided, such additional
aggregate reserve requirements are applied in a non-discriminatory manner to all
borrowers of Mezzanine Lender and Mezzanine Lender has used commercially
reasonable efforts to avoid or mitigate the imposition of such additional
aggregate reserve requirements. LIBOR shall be determined by Mezzanine Lender or
its agent in accordance with this definition.

                  "LIBOR Spread" means 6.00% (600 basis points).



                                       14
<PAGE>   18

                  "Lien" means any mortgage, deed of trust, deed to secure debt,
lien (statutory or other), pledge, easement, restrictive covenant, lis pendens,
hypothecation, assignment, preference, priority, security interest, or any other
encumbrance or charge on or affecting the Property or any portion thereof or any
of the Collateral or Mezzanine Borrower or First Mortgage Loan Borrower, or any
interest in any of the foregoing, including, without limitation, any conditional
sale or other title retention agreement, any financing lease having
substantially the same economic effect as any of the foregoing, the filing of
any financing statement or similar instrument under the UCC or comparable law of
any other jurisdiction, domestic or foreign, and mechanic's, materialmen's and
other similar liens and encumbrances.

                  "Liquidation Event" means (i) any sale, transfer or other
disposition or liquidation of any property or asset of Mezzanine Borrower or
First Mortgage Loan Borrower of any kind or any portion thereof, (other than
dispositions of obsolete property or equipment, unless such property is replaced
or discarded and not replaced, in either instance, in the ordinary course of
First Mortgage Loan Borrower's business), (ii) any sale, transfer or other
disposition or liquidation of the Property or any portion thereof (including any
foreclosure sale) or interest therein, (iii) any casualty to the Property or any
property or asset of any kind or any portion thereof, (iv) any condemnation of
the Property or any property or asset of any kind or any portion thereof or (v)
any refinancing of the Property or any property or asset of Mezzanine Borrower
or First Mortgage Loan Borrower of any kind or any refinancing or defeasance of
the First Mortgage Loan approved by Mezzanine Lender.

                  "Management Agreement" shall mean that certain Amended and
Restated Hotel Management Agreement dated as of March 27, 2001, between First
Mortgage Loan Borrower, as owner, and Manager, as manager, and any other
property management agreement approved by Mezzanine Lender in accordance with
the terms hereof.

                  "Management Fees" means the management fees payable to Manager
for the management of the Property, not to exceed in any fiscal year three
percent (3.0%) of the Receipts (excluding service charges) of the Property for
such fiscal year provided, that if Manager is an Affiliate of Mezzanine Borrower
then upon a Cash Sweep Event all Management Fees in excess of 2.0% shall be
deferred until the Cash Sweep Event has been terminated and which deferred fees
may thereafter be paid from funds available to Mezzanine Borrower under Section
2.2(a)(viii) of the Mezzanine Deposit Account Agreement.

                  "Manager" means Opryland Hospitality, LLC or any successor
manager of the Property approved by Mezzanine Lender.

                  "Material Adverse Condition" means a condition or circumstance
that results in or causes a material adverse effect upon (i) the business or the
financial condition or results of operation of Mezzanine Borrower or First
Mortgage Loan Borrower, (ii) the ability of Mezzanine Borrower or Guarantor to
make any payment under or to perform any or all of its obligations under this
Agreement or any of the other Mezzanine Loan Documents, (iii) the legality,
validity or enforceability of any of the Mezzanine Loan Documents or Mezzanine
Lender's ability to enforce any of its rights under the Mezzanine Loan
Documents, or (iv) the Lien and security interest of Mezzanine Lender or the
value of the Collateral or the Property (but only to the extent



                                       15
<PAGE>   19

such decrease in value is specifically related to the Property and not to
conditions in the economy in general).

                  "Material Lease" means any Lease of space in the Property
which (a) either provides for annual rent or other payments in an amount equal
to or greater than $500,000 or has a term (including all extensions and renewals
which are unilaterally exercisable by the tenant thereunder) of more than five
(5) years, and (b) may not be cancelled by either party thereto on thirty (30)
days' notice without payment of a termination fee, penalty or other cancellation
fee.

                  "Maturity Date" means the earliest to occur of (i) April 1,
2004, as may be extended pursuant to Section 2.13, (ii) the maturity date or
earlier termination or acceleration of the First Mortgage Loan, (iii) the date
of prepayment of the First Mortgage Loan, or (iv) such earlier date resulting
from acceleration of the Debt by Mezzanine Lender.

                  "Maximum Amount" means the maximum rate of interest designated
by applicable laws relating to payment of interest and usury.

                  "Membership Interest Pledge Agreement" means that certain
Pledge of Limited Liability Company Membership Interest dated as of the Closing
Date, between Mezzanine Borrower, as pledgor, and Mezzanine Lender, as pledgee,
with respect to the membership interest held by Mezzanine Borrower in First
Mortgage Loan Borrower, as the same may be hereafter modified, amended or
supplemented from time to time.

                  "Mezzanine Borrower" has the meaning provided in the preamble
to this Agreement.

                  "Mezzanine Borrower's Certificate" means a certificate
executed by a senior executive officer of the Control Entity of Mezzanine
Borrower in form and substance satisfactory to Mezzanine Lender in Mezzanine
Lender's discretion dated as of the Closing Date.

                  "Mezzanine Deposit Account Agreement" means that certain
deposit account agreement entered into among Mezzanine Lender, Mezzanine
Borrower and Deposit Bank, as the same may be amended, modified or supplemented
from time to time.

                  "Mezzanine Lender" means, collectively, Merrill Lynch,
together with any other Person that shall have become a party hereto pursuant to
an Assignment and Acceptance, but excluding any such Person that ceases to be a
party hereunder pursuant to Section 8.34.2. If there shall be more than one (1)
Person who shall be deemed a "Mezzanine Lender" hereunder, the Agent shall be
considered the "Mezzanine Lender" for purposes of taking (or not taking) action
under this Agreement or under any other Mezzanine Loan Documents, and Mezzanine
Borrower shall be entitled to rely on such action by Agent and each Mezzanine
Lender shall be bound by such action of the Agent.

                  "Mezzanine Loan" has the meaning provided in the Recitals
hereto.

                  "Mezzanine Loan Amount" has the meaning provided in the
Recitals hereto.



                                       16
<PAGE>   20

                  "Mezzanine Loan Documents" means, collectively, this
Agreement, the Mezzanine Note, the Equity Pledge Agreements, the Guaranty, the
Environmental Indemnity, the Mezzanine Deposit Account Agreement, the Assignment
of Interest Rate Cap Agreement and all other agreements, instruments,
certificates and documents executed or delivered by or on behalf of Mezzanine
Borrower or any other Person to evidence or secure the Mezzanine Loan or
otherwise in satisfaction of the requirements of this Agreement, or the other
documents listed above, as each such agreement, instrument, certificate or
document may be amended, replaced, restated, split, consolidated, supplemented
or modified from time to time.

                  "Mezzanine Note" means the promissory note(s), dated the
Closing Date, substantially in the form of Exhibit D annexed hereto and made a
part hereof, in the original aggregate principal amount of One Hundred Million
Dollars ($100,000,000), made by Mezzanine Borrower to Mezzanine Lender pursuant
to this Agreement, as such promissory note(s) may be modified, amended,
supplemented, extended, split or consolidated in writing, and any note(s) issued
in substitution or exchange therefor or in replacement thereof.

                  "Money" means all moneys, cash, rights to deposit or savings
accounts, credit card receipts, rents or other items of legal tender.

                  "Monthly Payment Amount" means, with respect to any Interest
Accrual Period, an amount equal to all accrued and unpaid interest calculated at
the Interest Rate on the daily balance of the Principal Indebtedness during that
Interest Accrual Period plus any scheduled amortization of principal required
under the Mezzanine Note; provided, however, that if Mezzanine Lender
accelerates the Debt in connection with any Payment Breach, then Mezzanine
Borrower's obligation to pay Excess Cash Flow on each Payment Date shall not
terminate until the Debt is paid in full. Monthly amortization payments shall
equal the amount, if any, by which $667,000.00 exceeds the amount of monthly
amortization paid under the First Mortgage Loan.

                  "Monthly Tax and Insurance Amount" has the meaning provided in
Section 3.4.

                  "Multiemployer Plan" means a Multiemployer plan defined as
such in Section 3(37) of ERISA to which contributions have been made by
Mezzanine Borrower or any ERISA Affiliate and which is covered by Title IV of
ERISA.

                  "Net Liquidation Proceeds" means (x) with respect to any
Liquidation Event relating to the Property, all amounts paid to or received by
or on behalf of First Mortgage Loan Borrower or Mezzanine Borrower in connection
with such Liquidation Event, including, without limitation, proceeds of any
sale, refinancing or other disposition or liquidation, the amount of any award
or payment in connection with any condemnation or taking by eminent domain, and
the amount of any insurance proceeds paid in connection with any casualty loss,
as applicable, other than, in the case of a casualty loss or condemnation award,
amounts applied to the restoration or repair of the Property or amounts required
by the terms of any of the First Mortgage Loan Documents to be applied to the
repayment of the First Mortgage Loan, less (i) in the case of a sale, other than
a foreclosure sale or deed in lieu of foreclosure pursuant to the First Mortgage
Loan, such reasonable and customary costs and expenses of sale (including
reasonable attorneys' fees and costs and brokerage commissions) as such costs
shall be approved by Mezzanine Lender pursuant to the terms hereof (if the sale
is of all or substantially all of the



                                       17
<PAGE>   21

Property or Collateral and the amount of the Net Liquidation Proceeds will not
be sufficient to repay the entire Debt), and the amount necessary to pay to
First Mortgage Lender to obtain the release of the First Mortgage, (ii) in the
case of a foreclosure sale, such costs and expenses incurred by the First
Mortgage Lender under any of the First Mortgage Loan Documents as First Mortgage
Lender shall be entitled to receive reimbursement for under the terms of First
Mortgage Loan Documents or under applicable law, (iii) in the case of a casualty
loss or condemnation, such costs and expenses of collection of the related
insurance proceeds or condemnation award as such costs shall be approved by
First Mortgage Lender pursuant to the terms of any of the First Mortgage Loan
Documents, or if the First Mortgage Loan has been paid in full, by Mezzanine
Lender pursuant to the terms of the Mezzanine Loan Agreement, and (iv) in the
case of a refinancing of the First Mortgage Loan, or the Property, amounts
required to be paid to First Mortgage Lender to obtain the release of the First
Mortgage and the reasonable costs and expenses of such refinancing as shall be
approved by Mezzanine Lender (if the amount of the Net Liquidation Proceeds will
not be sufficient to repay the entire Debt), and (y) with respect to any
Liquidation Event relating to any property other than the Property, including,
without limitation, any Collateral, all amounts paid to or received by Mezzanine
Borrower in connection with such Liquidation Event, less the reasonable costs
and expenses incurred by Mezzanine Borrower in connection with such Liquidation
Event as shall be approved by Mezzanine Lender (if the amount of the Net
Liquidation Proceeds will not be sufficient to repay the entire Debt).

                  "Net Liquidation Proceeds After Debt Service" means, (i) with
respect to any Liquidation Event relating to the Property, the Net Liquidation
Proceeds with respect thereto other than any portion thereof applied to the
payment of the amounts owed to First Mortgage Lender under the terms of any of
the First Mortgage Loan Documents; and (ii) with respect to any Liquidation
Event relating to properties or assets of any kind other than the Property,
including, without limitation, any Collateral, the Net Liquidation Proceeds with
respect thereto.

                  "Net Operating Income" means, for any 12-month period,
calculated on a trailing basis, the amount, determined by Mezzanine Lender and
calculated in all events in accordance with GAAP, equal to the excess of (a)
Receipts for such period minus (b) Expenses for such period.

                  "Officers' Certificate" means a certificate delivered to
Mezzanine Lender by Mezzanine Borrower which is signed by a senior executive
officer of its Control Entity.

                  "Operating Agreement" means the Amended and Restated Limited
Liability Company Operating Agreement dated March 27, 2001, with respect to the
First Mortgage Loan Borrower, as the same may be amended or modified from time
to time, subject to the required consents under the First Mortgage Loan
Documents and Mezzanine Loan Documents.

                  "Other Fees" has the meaning set forth in Section 2.10.

                  "Parent Pledgor" means Gaylord Entertainment Company, a
Delaware corporation, which is the sole owner of all outstanding stock issued by
the Control Entity of First Mortgage Loan Borrower.



                                       18
<PAGE>   22

                  "Payment Breach" means the failure of Mezzanine Borrower to
pay to Mezzanine Lender on any Payment Date all amounts due and owing on such
Payment Date pursuant to Section 3.3(d) of this Agreement.

                  "Payment Date" means the first (1st) day of each calendar
month, or if such day is not a Business Day, the next Business Day, commencing
on May 1, 2001.

                  "PBGC"' means the Pension Benefit Guaranty Corporation
established under ERISA, or any successor thereto.

                  "Permitted Indebtedness" means (A) with respect to the First
Mortgage Loan Borrower and the Property: (1) the First Mortgage Loan; (2) trade
payables, operating contracts and equipment leases for the Property entered into
in the ordinary course of business which are consistent with the Approved
Operating Budget and which are not more than thirty (30) days past due,
evidenced by a note or secured by the Property or any portion thereof, provided
the aggregate outstanding amount of which does not at any one time exceed
$13,750,000 and (3) such obligations of First Mortgage Loan Borrower under that
certain Settlement Agreement dated December 20, 2000 by and among Parent
Pledgor, First Mortgage Loan Borrower, and the Department of Water and Sewerage
Services of the Metropolitan Government of Nashville and Davidson Counties
("Water and Sewage Settlement Award") and (B) with respect to Mezzanine Borrower
means the Debt and such immaterial Indebtedness incurred in the ordinary course
of business which is not more than (30) days past due and which does not exceed
$50,000 outstanding at any one time for ordinary accounting services and
professional fees unless otherwise approved in writing by the Mezzanine Lender
in its sole discretion.

                  "Permitted Investments" shall have the meaning ascribed to
such term in the Mezzanine Deposit Account Agreement.

                  "Permitted Transfers" provided no Default or Event of Default
shall then exist shall mean (i) disposal by First Mortgage Loan Borrower of
obsolete or otherwise replaceable personal property, provided such property is
replaced (or discarded and not replaced) by First Mortgage Loan Borrower in the
ordinary course of business, (ii) distribution of partnership earnings by First
Mortgage Loan Borrower to Mezzanine Borrower and, after payment of all amounts
then due and payable hereunder (including all funding of all reserves required
to be maintained hereunder), distributions of earnings of Mezzanine Borrower to
its members (so long as no Event of Default or Cash Sweep Event is outstanding),
(iii) utility easements which do not materially adversely affect the Property
and have been approved by Mezzanine Lender in its reasonable discretion, (iv)
any Lease at the Property in writing entered into in accordance with the express
provisions of Section 5.2(c) or as otherwise approved by Mezzanine Lender in
writing in accordance with the express terms hereof and (v) transfers, directly
or indirectly, of ownership interests in First Mortgage Loan Borrower and
Mezzanine Borrower, other than interests held by, or in, their respective
Control Entity, (x) for estate and tax planning to any spouse, sibling, parent,
child or grandchild or to a trust for the benefit of such person or spouse,
sibling, parent, child or grandchild provided there is no change of control of
First Mortgage Loan Borrower, Mezzanine Borrower or their respective Control
Entity or (y) to any Institutional Investor or other Persons approved in advance
by Mezzanine Lender, such approval not to be unreasonably withheld, provided
that (i) no Event of Default then exists, (ii) in each case,



                                       19
<PAGE>   23

Mezzanine Borrower shall give Mezzanine Lender written notice of such transfer
together with copies of all instruments effecting such transfer not less than
ten (10) Business Days prior to the date of such transfer; (iii) in each case,
such transfer does not and will not result in the termination or dissolution of
Mezzanine Borrower, by operation of law or otherwise; (iv) Guarantor, or one or
more wholly owned subsidiaries of Guarantor, shall continue to together hold at
least fifty-one percent (51%) of the outstanding ownership interests in the
partner(s) or member(s) of Mezzanine Borrower, and Guarantor continues to
directly or indirectly control the business and affairs of Mezzanine Borrower;
(v) such transfer shall not result in a change of control of Mezzanine Borrower
or a change of the Manager without Mezzanine Lender's consent; and (vi) in each
case, the single purpose nature and bankruptcy remoteness of Mezzanine Borrower
after such transfer is satisfactory to Lender and in accordance with the
standards of the Rating Agencies. As used in this definition, the term "control"
shall have the meaning set forth in the definition of "Affiliate" in Section 1.1
and a "change of control" of any Person shall include the transfer of legal or
equitable ownership interests in such Person which after giving effect to such
transfer results in any transferee or pledgee of such interests holding more
than a 49% ownership interest or security interest in such Person. No Permitted
Transfer or other Transfer permitted by Mezzanine Lender shall release any
rights to the Collateral or any liability of the Mezzanine Borrower, the Control
Entity of Mezzanine Borrower, Guarantor or Parent Pledgor under the Mezzanine
Loan Documents, without the prior written consent of Mezzanine Lender.
Notwithstanding anything to the contrary contained herein, the provisions
restricting transfer shall not be applicable to transfer of publicly traded
stock in Guarantor.

                  "Person" means any individual, corporation, limited liability
company, partnership, joint venture, estate, trust, unincorporated association,
or any other entity, any federal, state, county or municipal government or any
bureau, department or agency thereof and any fiduciary acting in such capacity
on behalf of any of the foregoing.

                  "Plan" means an employee benefit or other plan established or
maintained by Mezzanine Borrower or any ERISA Affiliate and that is covered by
Title IV of ERISA, other than a Multiemployer Plan.

                  "Prepayment Fee" means an amount equal to the Principal
Indebtedness being prepaid on the date of prepayment multiplied by (x) two
percent (2.0%) during the period up to and including the first anniversary of
the Closing Date and (y) one percent (1.0%) during the subsequent period up to
and including the second anniversary of the Closing Date. No Prepayment Fee
shall be payable after the second anniversary of the Closing Date.

                  "Principal Indebtedness" means the principal amount of the
entire Mezzanine Loan outstanding from time to time as the same may be increased
or decreased, as a result of prepayment or otherwise.

                  "Proceeds" means all of Mezzanine Borrower's "proceeds," as
such term is defined in the UCC, and, to the extent not included in such
definition, all proceeds whether cash or non-cash, movable or immovable,
tangible or intangible (including Insurance proceeds, condemnation proceeds and
proceeds of proceeds), from the Collateral, including, without limitation, those
from the sale, exchange, transfer, collection, loss, damage, disposition,



                                       20
<PAGE>   24

substitution or replacement of any of the Collateral and all income, gain,
credit, distributions and similar items from or with respect to the Collateral.

                  "Pro Forma Debt Service" means the sum of the debt service on
the Mezzanine Loan and First Mortgage Loan as projected over the immediately
succeeding twelve (12) month period assuming both accrue at a rate equal to the
applicable LIBOR Spread or Applicable Spread (as defined in the First Mortgage
Loan Agreement) for the Mezzanine Loan and First Mortgage Loan, respectively,
plus the greater of (x) the then current LIBOR and (y) the then current yield on
10 Year U.S. Treasury Obligations.

                  "Pro Forma Net Operating Income" means the Net Operating
Income adjusted to reflect (x) the greater of (i) the actual management fees
under the Management Agreement and (ii) 3.0% of Receipts (excluding service
charges) for such trailing twelve (12) month period provided, however, if the
Manager is an Affiliate of the Mezzanine Borrower or First Mortgage Loan
Borrower for purposes of calculating Pro Forma Net Operating Income, Management
Fees shall be deemed to be 2.5% of Receipts (excluding service charges) and (y)
a reserve for FF&E equal to 4.0% of Receipts (excluding service charges) for
such trailing twelve month period.

                  "Property" means the real property and all improvements
located thereon commonly known as Opryland Hotel and Convention Center,
Nashville, Tennessee, as more particularly described in the First Mortgage.

                  "Rating Agencies" means Fitch, Inc. ("Fitch"), Moody's
Investors Service, Inc. ("Moody's") and Standard & Poor's Rating Services, a
division of The McGraw-Hill Companies, Inc. ("S&P") or any successor thereto,
and any other nationally recognized statistical rating organization to the
extent that any of the foregoing have been or will be engaged by First Mortgage
Lender or its designees in connection with or in anticipation of a
Securitization of the First Mortgage Loan or by Mezzanine Lender in connection
with a Securitization of the Mezzanine Loan, as applicable (each individually, a
"Rating Agency").

                  "Rating Confirmation Letter" means a letter issued by each
applicable Rating Agency which confirms that the taking of action referenced
therein will not result in any qualification, withdrawal or downgrading of any
existing ratings of securities, certificates or bonds arising from the
securitization of the First Mortgage Loan or Mezzanine Loan, as applicable.

                  "Receipts" shall mean, without duplication with respect to the
applicable periods set forth in this Agreement, all gross receipts, rents,
revenues, income, fees, payments and consideration actually collected by or on
behalf of First Mortgage Loan Borrower, Manager (excluding Management Fees paid
in accordance with this Agreement), Mezzanine Borrower and their respective
Affiliates from any and all sources in any way, manner or respect relating to
and/or arising from the Property in accordance with GAAP, including, without
limitation, (a) gross fixed, minimum and guaranteed rentals or other sums paid
by Tenants or other occupants, licensees, concessionaires or users of the
Property to or for the account or benefit of First Mortgage Loan



                                       21
<PAGE>   25

Borrower or any of its Affiliates, relating to the occupancy of the Property,
(b) percentage, overage, additional and similar rentals paid by Tenants or other
occupants, licensees or users of the Property to or for the account or benefit
of First Mortgage Loan Borrower or any of its Affiliates, relating to the
occupancy of the Property, (c) amounts paid by Tenants or other occupants,
licensees or users of the Property to or for the account or benefit of First
Mortgage Loan Borrower or any of its Affiliates, including, without limitation,
common area maintenance charges, pursuant to escalation provisions in Leases or
other agreements or on account of maintenance, operating and tax expenses for
the Property or utility reimbursements or merchant association dues or
advertising fund payments, (d) fees or charges for (i) heating, ventilation, air
conditioning and other utility services, including condenser water, (ii) freight
elevator service, (iii) lobby directory service, (iv) extra rubbish removal, (v)
repairs and (vi) other non-standard services, (e) late charges and interest paid
to or for the account or benefit of First Mortgage Loan Borrower or any of its
Affiliates, pursuant to Leases and amounts paid to or for the account or benefit
of First Mortgage Loan Borrower or any of its Affiliates, as a result of
provisions in Leases permitting the landlord thereunder to receive or share in
receipt from the subleasing of space demised under, or the assignment of,
Leases, (f) payments made by any Tenant in consideration of, or with respect to,
a Lease termination, modification and/or consent, (g) automobile parking fees
and rentals, if any, other fees, charges or payments, whether or not denominated
as rental, but paid to or for the account or benefit of First Mortgage Loan
Borrower or any of its Affiliates for or in connection with the rental or
occupancy of any portion of the Property, (h) proceeds of any Insurance (for
business interruption or loss of rents) or Awards (for a temporary taking to the
extent compensation for lost rent) received by or for the account or benefit of
First Mortgage Loan Borrower or any or its Affiliates, relating to the Property,
(i) Tenants' security deposits to the extent they have been applied to payment
of Tenants' obligations, (j) net proceeds (after deducting amounts paid or
payable to Tenants) from refunds obtained as a result of pursuing available
legal remedies in contesting the validity of any Imposition or as a result of a
reduction of assessed valuation of the Property, (k) damages or settlement
payments paid by third parties in connection with the Property (other than in
respect of personal injury claims), (l) income, rentals and receipts derived by
First Mortgage Loan Borrower from any ancillary businesses, licenses and
concessions at the Property, (m) refunds of insurance premiums or any other item
which would constitute an Expense if paid by First Mortgage Loan Borrower
(unless otherwise credited to an expense account), (n) any sums paid to
Mezzanine Borrower by the counterparty to the Interest Rate Cap Agreement or
similar hedging agreement which may be entered into by Mezzanine Borrower in
connection with the Mezzanine Loan, (o) all revenues and credit card receipts
(including, without limitation, service charges) collected from guest rooms,
restaurants, bars, meeting rooms, banquet rooms and recreational facilities,
parking charges, all revenues and receipts now existing or hereafter arising or
created out of the sale, lease, sublease, license, concession or other grant of
the right of the use and occupancy of property, or rendering of services by
owner or any operator or manager of the hotel or the commercial space located in
the Improvements or acquired from others (including, without limitation, from
the rental of any office space, retail space, guest rooms or other space, halls,
stores, and offices, and deposits securing reservations of such space), license,
lease, sublease and concession fees and rentals, health club membership fees,
food and beverage wholesale and retail sales, service charges and vending
machine sales and all other items of revenue which would be included as income,
rents or profits under the USAH and (p) all other amounts payable to Mezzanine
Borrower or First Mortgage Loan Borrower during such period in respect of items
which, in accordance with GAAP, would be included in such Person's Financial
Statements for such period or any other period as revenue of the Property.



                                       22
<PAGE>   26

                  Notwithstanding the foregoing clauses (a) through (p),
Receipts shall not include (i) any proceeds resulting from the Transfer of all
or any part of the Property (other than rents paid under Leases), (ii) rentals
under Leases paid more than one (1) month in advance, (iii) security or other
refundable deposits paid by Tenants, except to the extent applied to the payment
of Tenants' obligations, (iv) payments made by a Tenant to First Mortgage Loan
Borrower for tenant improvements to be paid for by the Tenant to the extent that
Mezzanine Borrower or First Mortgage Loan Borrower transmits such payment to the
contractor installing such tenant improvements except for management fees or
administrative fees related thereto, (v) promotional and similar receipts
collected by First Mortgage Loan Borrower, to the extent remitted to merchants'
associations and the like and (vi) revenues and other receipts of Affiliates of
First Mortgage Loan Borrower and Mezzanine Borrower that are derived from the
sale of goods and services by such Persons at or from the Property, as opposed
to rents paid by such entities for their use and occupancy of their respective
premises.

                  "Recourse Obligations" has the meaning set forth in Section
8.15.

                  "Related Party" has the meaning set forth in Section 8.15.

                  "Required Debt Service Payment" means, on any Payment Date,
the Debt Service then due and payable by Mezzanine Borrower.

                  "Reuters Screen LIBO Page" means the display designated as
page "LIBO" on the Reuters Monitor Money Rates Service (or such other page as
may replace that page on the service for the purpose of displaying interbank
rates from London in U.S. Dollars).

                  "Securities" has the meaning set forth in Section 8.34.

                  "Securities Account" has the meaning assigned to such term in
Section 8-501 of the UCC.

                  "Securities Intermediary" has the meaning assigned to such
term in Section 8-102(14) of the UCC.

                  "Securitization" has the meaning set forth in Section 8.34.

                  "Servicer" means a servicer selected by First Mortgage Lender
from time to time in its sole discretion to service the First Mortgage Loan.

                  "Special Purpose Bankruptcy Remote Entity" has the meaning set
forth in Section 5.1(p).

                  "Stock Pledge Agreement" means that certain Stock Pledge
Agreement dated as of the Closing Date, between Parent Pledgor, as pledgor, and
Mezzanine Lender, as pledgee, with respect to the outstanding stock of the
Control Entity of First Mortgage Loan Borrower, as the same may be hereafter
modified, amended or supplemented from time to time.



                                       23
<PAGE>   27

                  "Subsidiary" of any Person means any corporation, partnership,
limited liability company or other entity in which such Person holds an equity
interest constituting more than ten percent (10%) of the equity classes issued
by such entity.

                  "Tax and Insurance Account" has the meaning set forth in
Section 3.4.

                  "Telerate Page 3750" means the display designated as Page 3750
on the Dow Jones Telerate Service (or such other page as may replace Page 3750
on that service or such other service as may be nominated by the British
Banker's Association as the information vendor for the purpose of displaying
British Bankers' Association Interest Settlement Rates for the U.S. Dollar
deposits).

                  "Tenant" means any permitted occupant, tenant, subtenant or
licensee of the Property.

                  "Term" means the period from and after the Closing Date to and
including the first to occur of the Maturity Date or the date the Debt is paid
in full.

                  "Three Year Business Plan" means that certain Three Year
Business Plan prepared by Opryland Hospitality Group.

                  "Title Insurer" means Chicago Title Insurance Company, as sole
insurer or, in the case of co-insurance, as lead insurer.

                  "Title Policy" means an owner's title insurance policy, issued
or co-insured by the Title Insurer, on ALTA form 1970 (with 1984 changes).

                  "Transaction Costs" means all reasonable fees, costs, expenses
and disbursements paid or payable by Mezzanine Borrower relating to the
Transactions, including, without limitation, all fees, costs, expenses and
disbursements described in Section 8.24.

                  "Transactions" means the transactions contemplated by the
Mezzanine Loan Documents.

                  "Transfer" means any conveyance, assignment, disposition,
alienation, transfer (including, without limitation, any transfer of any direct
or indirect legal or beneficial interest, including, without limitation, any
profits interest, in Mezzanine Borrower or First Mortgage Loan Borrower), sale,
contract to sell, Lease (including, without limitation, any amendment,
extension, modification, waiver or renewal thereof), or Lien, whether
voluntarily, by law or otherwise, of, on, in or affecting any Collateral,
Mezzanine Borrower, First Mortgage Loan Borrower, Manager or the Property.

                  "UCC" means, with respect to any Collateral, the Uniform
Commercial Code in effect in the State of New York from time to time or the
state in which any Accounts or Collateral is located.



                                       24
<PAGE>   28

                  "USAH" means the most current edition of the Uniform System of
Accounts for Hotels (or the Lodging Industry) promulgated by the American Hotel
and Motel Association as in effect from time to time.

                                   ARTICLE II

                                  GENERAL TERMS

                  Section 2.1. Amount of the Mezzanine Loan. Mezzanine Lender
shall lend to Mezzanine Borrower an amount equal to the Mezzanine Loan Amount,
which Mezzanine Lender shall disburse to Mezzanine Borrower on the Closing Date.
No amount repaid in respect of the Mezzanine Loan may be reborrowed.

                  Section 2.2. Use of Proceeds. Proceeds of the Mezzanine Loan
shall be used for capital investment in First Mortgage Loan Borrower and general
purposes of Mezzanine Borrower including distributions to the Parent Pledgor.

                  Section 2.3. Security for the Mezzanine Loan. The Mezzanine
Note and Mezzanine Borrower's obligations hereunder and under the other
Mezzanine Loan Documents shall be secured by the Collateral.

                  Section 2.4. Mezzanine Note. Mezzanine Borrower's obligation
to pay the principal of and interest on the Mezzanine Loan (including Late
Charges and Default Rate interest), shall be evidenced by this Agreement and by
the Mezzanine Note, duly executed and delivered by Mezzanine Borrower. The
Mezzanine Note shall be payable as to principal, interest, Late Charges and
Default Rate interest, as specified in this Agreement, with a final maturity on
the Maturity Date. Mezzanine Borrower shall pay all outstanding Debt on the
Maturity Date.

                  Section 2.5. Principal and Interest Payments.

                  (a) Accrual of Interest. Interest shall accrue on the
outstanding principal balance of the Mezzanine Note and all other amounts due to
Mezzanine Lender under the Mezzanine Loan Documents at the Interest Rate.

                  (b) Payment of Interest and Principal. On the Closing Date,
Mezzanine Borrower shall pay to Mezzanine Lender interest for the first (1st)
Interest Accrual Period with respect to the Mezzanine Loan. On each Payment Date
commencing with the Payment Date immediately after the end of the second (2nd)
Interest Accrual Period through and including the Maturity Date, Mezzanine
Borrower shall pay to the Mezzanine Lender, in accordance with Section 3.3(d),
the Combined Monthly Payment Amount. Interest shall be payable in arrears. The
principal required to be repaid on any Payment Date prior to the Maturity Date
shall equal the amount, if any, by which $667,000.00 exceeds the amount of
monthly amortization paid under the First Mortgage Loan and such other amounts
required under Section 2.5(c), Section 2.12, Section 5.3 and Section 5.4 herein.

                  (c) Payment of Liquidation Proceeds. Upon the receipt of any
Net Liquidation Proceeds by Mezzanine Borrower or any of its Affiliates,
Mezzanine Borrower shall



                                       25
<PAGE>   29

be required, on the date of such receipt, to apply the related Net Liquidation
Proceeds After Debt Service to the prepayment of principal on the Mezzanine
Note, together with accrued and unpaid interest and any breakage costs under
Section 2.6, up to and including the date on which such prepayment occurs, and
all other amounts then due and payable on the Mezzanine Note (including, without
limitation, the Prepayment Fee, if applicable).

                  (d) Calculation of Interest. Interest shall accrue on the
outstanding Principal Indebtedness and all other amounts due to Mezzanine Lender
under the Mezzanine Loan Documents commencing upon the Closing Date. Interest
shall be computed on the actual number of days elapsed in each year over a
360-day year.

                  (e) Default Rate Interest. After the occurrence and during the
continuation of an Event of Default, the entire unpaid amount outstanding
hereunder and under the Mezzanine Note will bear interest at the Default Rate;
provided, however, if Mezzanine Lender shall have accelerated the Debt, the
Mezzanine Note shall continue to bear interest at the Default Rate until paid in
full.

                  (f) Late Charge. If Mezzanine Borrower fails to make any
payment of any sums due under the Mezzanine Loan Documents within five (5) days
after receipt of written notice that the same is due, (which written notice
shall not be given more than twice per calendar year) in addition to Mezzanine
Lender's rights hereunder, Mezzanine Borrower shall pay a Late Charge; provided,
however, that if Mezzanine Borrower shall fail to pay the Monthly Payment Amount
on the date same becomes due and payable, without notice the Late Charge shall
be immediately due and payable and the aforesaid five (5) day period shall not
apply with respect to such delinquent payment.

                  (g) Maturity Date. On the Maturity Date, Mezzanine Borrower
shall pay to Mezzanine Lender the Debt and all other amounts then due under the
Mezzanine Loan Documents, including, without limitation, any applicable
Prepayment Fee, Late Charges and Default Rate interest.

                  Section 2.6. Voluntary Prepayment. Mezzanine Borrower shall
have the right, on any Payment Date, to prepay the Mezzanine Loan, in whole or
in part, upon at least five (5) Business Days' irrevocable notice to Mezzanine
Lender, specifying the amount and the date of prepayment, provided that on the
date of such prepayment Mezzanine Borrower shall pay to Mezzanine Lender the
Prepayment Fee on the Principal Indebtedness so prepaid, if applicable. Any
partial prepayments of the Mezzanine Loan (other than repayments permitted under
clauses (x) and (y) below) shall be in the amount of at least $1,000,000. Upon
the receipt of any prepayment, Mezzanine Lender shall apply the amount of
prepayment in accordance with Section 2.7. If any prepayment is received by
Mezzanine Lender on a Business Day other than a Payment Date, then Mezzanine
Borrower shall also pay interest on the Mezzanine Loan to the following Payment
Date together with an amount necessary to reimburse Mezzanine Lender for any
costs, losses or expenses incurred in connection with breaking any LIBOR
contracts or redeploying funds as a consequence of such prepayment.
Notwithstanding anything to the contrary set forth herein, no Prepayment Fee
shall be due and payable in connection with a prepayment (x) arising as a result
of the application of Net Liquidation Proceeds relating to a casualty or
condemnation event of the Property or any portion thereof or (y) constituting a



                                       26
<PAGE>   30

principal curtailment payment of the Mezzanine Loan made by Mezzanine Borrower
in order to prevent the occurrence of a Financial Covenant Breach as reasonably
determined by Mezzanine Lender or during a Cash Sweep Event Cure Period to cure
a Financial Covenant Breach provided in the latter case that any funds in the
Cash Sweep Event Reserve Account shall be applied in accordance with the
provisions of Section 2.12(a) hereof.

                  Section 2.7. Application of Payments. Provided no Event of
Default has occurred and is continuing, all proceeds of any repayment, including
prepayments, of the Mezzanine Loan shall be applied to pay: first, any costs and
expenses of Mezzanine Lender required to be reimbursed under the terms of the
Mezzanine Loan Documents, including, without limitation, the Mezzanine Lender's
reasonable attorneys' fees and disbursements (i) arising as a result of such
repayment or (ii) expended by Mezzanine Lender to protect, preserve, foreclose,
or realize upon, or take any other action with respect to the Collateral;
second, to accrued and unpaid interest at the Interest Rate, third, to the
Prepayment Fee, if any; fourth, to the Principal Indebtedness; and fifth, any
other amounts then due and owing under the Mezzanine Loan Documents. After the
occurrence of an Event of Default, all proceeds of repayment, including any
payment or recovery on the Collateral shall be applied first, to the Prepayment
Fee, if any, and second, in such order and in such manner as Mezzanine Lender
shall elect in Mezzanine Lender's discretion.

                  Section 2.8. Payment of Debt Service, Method and Place of
Payment.

                  (a) Except as otherwise specifically provided herein, all
payments and prepayments under this Agreement and the Mezzanine Note shall be
made to Mezzanine Lender not later than 1:00 P.M., New York time, on the date
when due, and shall be made in lawful money of the United States of America in
federal or other immediately available funds to an account specified to
Mezzanine Borrower by Mezzanine Lender in writing, and any funds received by
Mezzanine Lender after such time, for all purposes hereof, shall be deemed to
have been paid on the next succeeding Business Day.

                  (b) All payments made by Mezzanine Borrower hereunder or under
the other Mezzanine Loan Documents, shall be made irrespective of, and without
any deduction for, any set-offs or counterclaims.

                  Section 2.9. Taxes. All payments made by Mezzanine Borrower
under this Agreement and under the other Mezzanine Loan Documents shall be made
free and clear of, and without deduction or withholding for or on account of,
any present or future income, stamp or other taxes, levies, imposts, duties,
charges, fees, deductions or withholdings, now or hereafter imposed, levied,
collected, withheld or assessed by any Governmental Authority.

                  Section 2.10. Servicing Fee and Other Fees. From and after the
Closing Date until the Maturity Date and full repayment of the Debt, Mezzanine
Borrower shall pay to the Mezzanine Lender a fee equal to (i) the actual third
party credit administration and servicing fee incurred by Mezzanine Lender (the
"Servicing Fee"), (ii) the actual third party custodial fees incurred by
Mezzanine Lender, (iii) the actual third party Deposit Bank fees incurred by
Mezzanine Lender and (iv) the actual third party Trustee fees incurred by
Mezzanine Lender in connection with the Mezzanine Loan (items (ii), (iii) and
(iv) shall collectively be referred to as



                                       27
<PAGE>   31

the "Other Fees"). The Servicing Fee and the Other Fees are not included in the
LIBOR Spread, shall be payable monthly in arrears on each Payment Date and shall
be at competitive market rates for similar transactions.

                  Section 2.11. Limitation of Interest. It is expressly
stipulated and agreed to be the intent of Mezzanine Borrower and Mezzanine
Lender at all times to comply with applicable state law or applicable United
States federal law (to the extent that it permits Mezzanine Borrower and
Mezzanine Lender to contract for, charge, take, reserve, or receive a greater
amount of interest than under state law) and that this Section shall control
every other covenant and agreement in this Agreement, the Mezzanine Note and the
other Mezzanine Loan Documents. If the applicable law (state or federal) is ever
judicially interpreted so as to render usurious or otherwise in contravention of
applicable laws, any amount called for under this Agreement, the Mezzanine Note
or under any of the other Mezzanine Loan Documents, or contracted for, charged,
taken, reserved, or received with respect to the Mezzanine Loan, or if Mezzanine
Lender's exercise of the option to accelerate the Maturity Date, or if any
prepayment by Mezzanine Borrower results in Mezzanine Borrower having paid any
interest in excess of that permitted by applicable law, then it is Mezzanine
Lender's express intent that all excess amounts collected by Mezzanine Lender
shall be credited to the principal balance of the Mezzanine Note (or if paid in
full, then refunded to the Mezzanine Borrower), and the provisions of this
Agreement, the Mezzanine Note and the other Mezzanine Loan Documents immediately
be deemed reformed and the amounts thereafter collectible hereunder and
thereunder reduced, without the necessity of the execution of any new documents,
so as to comply with the applicable law, but so as to permit the recovery of the
fullest amount otherwise called for hereunder or thereunder. All sums paid or
agreed to be paid to Mezzanine Lender for the use, forbearance, or detention of
the Mezzanine Loan shall, to the extent permitted by applicable law, be
amortized, prorated, allocated, and spread throughout the full stated term of
the Mezzanine Loan so that the rate or amount of interest on account of the
Mezzanine Loan does not exceed the maximum lawful rate from time to time in
effect and applicable to the Mezzanine Loan for so long as the Mezzanine Loan is
outstanding. Notwithstanding anything to the contrary contained in this
Agreement, the Mezzanine Note or the other Mezzanine Loan Documents, it is not
the intention of Mezzanine Lender to accelerate the maturity of any interest
that has not accrued at the time of such acceleration or to collect unearned
interest at the time of such acceleration.

                  Section 2.12. Mandatory Prepayments; Cash Sweep Events.

                  (a) If, at any time prior to the repayment of the Debt, any of
the following events occur (each, a "Cash Sweep Event") (i) an Event of Default
occurs and is continuing, (ii) as of a Quarterly Test Date (as such term is
hereinafter defined) the DSCR is less than 1.15 for a trailing twelve (12) month
period or (iii) as of a Quarterly Test Date the Debt Yield is less than 13.5%
for a trailing twelve (12) month period (each of (ii) and (iii), a "Financial
Covenant Breach") then, from and after the occurrence of such Cash Sweep Event
and for so long as such Cash Sweep Event continues to exist, all Excess Cash
Flow otherwise available to the Mezzanine Borrower under the Mezzanine Deposit
Account Agreement shall be deposited into the Cash Sweep Event Reserve Account.
Notwithstanding any provision herein to the contrary, if an Event of Default has
occurred and is continuing, all funds on deposit in the Cash Sweep Event Reserve
Account and any subsequent Excess Cash Flow deposited into the Cash Sweep Event
Reserve Account while such Event of Default is continuing, may be applied by
Mezzanine



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<PAGE>   32

Lender to reduce the Principal Indebtedness in accordance with Section 2.7. With
respect to any Cash Sweep Event that is a Financial Covenant Breach, the
Mezzanine Borrower shall have three (3) months from delivery of the Cash Sweep
Event Notice (as hereinafter defined) to remedy such Financial Covenant Breach
("Cash Sweep Event Cure Period"), including the right to direct a principal
curtailment payment of the First Mortgage Loan (or if the First Mortgage Loan
has been repaid in full to the Mezzanine Loan without any Prepayment Fee).
Provided no Event of Default exists, Mezzanine Borrower may, at its sole
election during the Cash Sweep Event Cure Period, direct Mezzanine Lender to
apply the funds in the Cash Sweep Event Reserve Account to a principal
curtailment payment of the First Mortgage Loan (or if the First Mortgage Loan
has been repaid in full to the Mezzanine Loan without any Prepayment Fee)
regardless of whether such amounts are sufficient to cure such Financial
Covenant Breach provided the funds in the Cash Sweep Event Reserve Account are
so applied before any supplemental payments necessary to cure such Financial
Covenant Breach are made by the Mezzanine Borrower. Any Financial Covenant
Breach will be measured during the Cash Sweep Event Cure Period on a monthly
basis on each Monthly Test Date (as such term is hereinafter defined). If no
Event of Default exists and if the Mezzanine Borrower fails to remedy a
Financial Covenant Breach during a Cash Sweep Event Cure Period, the Mezzanine
Lender will direct all funds held in the Cash Sweep Event Reserve Account on the
next Payment Date after the Cash Sweep Event Cure Period to a prepayment of
principal of the First Mortgage Loan (or if the First Mortgage Loan has been
repaid in full to the Mezzanine Loan without any Prepayment Fee). Mezzanine
Borrower agrees and acknowledges that such sums shall be applied to the First
Mortgage Loan and shall not be deemed a payment under the Mezzanine Loan
Documents and the Mezzanine Loan shall not be reduced or discharged in whole or
part, due to such payments. If a Financial Covenant Breach is remedied or
otherwise satisfied on a Monthly Test Date, the Excess Cash Flow available
following such Monthly Test Date to the earlier of the next Monthly Test Date or
Quarterly Test Date shall be distributed to the Mezzanine Borrower pursuant to
the terms of the Mezzanine Deposit Account Agreement but all funds on deposit in
the Cash Sweep Event Reserve Account shall continue to be additional Collateral
until the Financial Covenant Breach has been remedied for two (2) consecutive
months, at which time such funds shall be released to the Mezzanine Borrower, or
until applied as set forth below on the next Quarterly Test Date. If on the next
Quarterly Test Date (x) Mezzanine Lender determines that no new Cash Sweep Event
exists, the funds in the Cash Sweep Event Reserve Account shall be released to
Mezzanine Borrower; or (y) the Mezzanine Lender determines that a new Cash Sweep
Event then exists, Mezzanine Lender shall apply the funds in the Cash Sweep
Event Reserve Account to prepayment of the First Mortgage Loan, (or if the First
Mortgage Loan has been repaid in full to the Mezzanine Loan) deliver to
Mezzanine Borrower a new Cash Sweep Event Notice and direct that while such Cash
Sweep Event continues to exist all Excess Cash Flow be deposited into the Cash
Sweep Event Reserve Account.

                  For purposes of this Section 2.12, the following defined terms
shall apply:

                  "Quarterly Test Date" means the date upon which the Mezzanine
Lender, based on the financial statements of the Mezzanine Borrower for the most
recent calendar quarter, determines whether a Cash Sweep Event exists.

                  "Monthly Test Date" means the date, other than a Quarterly
Test Date, during a Cash Sweep Event Cure Period upon which the Mezzanine
Lender, based on the financial



                                       29
<PAGE>   33

statements of the Mezzanine Borrower for the most recent month, determines
whether a Financial Covenant Breach has been remedied or otherwise satisfied.

                  (b) The existence of a Cash Sweep Event shall be determined
solely, but reasonably and in good faith, by the Mezzanine Lender which shall be
conclusive absent manifest error. If Mezzanine Lender makes a determination that
a Cash Sweep Event has occurred, Mezzanine Lender shall send to Servicer,
Mezzanine Deposit Bank and Mezzanine Borrower a written notice ("Cash Sweep
Event Notice"), together with adequate information to allow Mezzanine Borrower
to verify such determination.

                  Section 2.13. Extension of Loan. Provided no Event of Default
has occurred and is continuing, the Mezzanine Borrower shall have the option to
exercise two twelve (12) month extensions to the Maturity Date subject to the
following conditions: (a) Mezzanine Lender receives written notice of Mezzanine
Borrower's election to extend the Term not less than ninety (90) days prior to
the Maturity Date ("Extension Notice"); (b) concurrently with the Extension
Notice, Mezzanine Lender is paid a nonrefundable extension fee in the amount of
0.375% of the Principal Indebtedness with respect to the first extension and
0.50% of the Principal Indebtedness with respect to the second extension
("Extension Fee"); (c) Mezzanine Lender receives an Officer's Certificate
stating that (i) no Default currently exists under the Mezzanine Loan Documents,
(ii) no Material Adverse Condition currently exists, (iii) the DSCR on a
trailing twelve (12) month basis based on the last monthly financial statements
is at least 1.15, (iv) the Debt Yield based on the last monthly financial
statements is at least 13.5%, (v) Mezzanine Borrower pays all costs and expenses
(including reasonable attorneys' fees and disbursements) incurred by Mezzanine
Lender in connection with such extension and (vi) Mezzanine Borrower shall have
entered into an Interest Rate Cap Agreement with a counterparty acceptable to
Mezzanine Lender, providing Mezzanine Borrower with an initial cap on LIBOR at a
maximum of 7.50% which may be replaced or renewed with a cap of a maximum of
8.25% per annum.

                                  ARTICLE III

                     CONDITIONS PRECEDENT; AND THE ACCOUNTS

                  Section 3.1. Conditions Precedent to the Making of the
Mezzanine Loan.

                  (a) As a condition precedent to the making of the Mezzanine
Loan, Mezzanine Borrower shall have satisfied the following conditions (unless
waived by Mezzanine Lender in accordance with Section 8.4) on or before the
Closing Date:

                  (1) Commitment Conditions.

                      (A) Mezzanine Borrower shall have paid to Mezzanine Lender
(or shall pay to Mezzanine Lender out of the proceeds of the Mezzanine Loan) the
origination fee and other fees referred to in the commitment letter.

                      (B) Mezzanine Lender shall have received appraisals of the
Property satisfactory in form and substance to, and performed on the basis of
assumptions acceptable to,



                                       30
<PAGE>   34

Mezzanine Lender. Such appraisals shall be performed by an independent MAI
appraiser acceptable to Mezzanine Lender in its sole discretion.

                      (C) Mezzanine Lender shall have received the Environmental
Report acceptable to Mezzanine Lender in its sole discretion.

                      (D) Mezzanine Lender shall have received the Three Year
Business Plan acceptable to Mezzanine Lender in its sole discretion.

                      (E) The form and substance of the First Mortgage Loan
Documents shall be satisfactory to Mezzanine Lender in all respects and the
First Mortgage Loan shall have been closed and funded in accordance with the
provisions of the First Mortgage Loan Documents.

                  (2) Mezzanine Loan Documents.

                      (A) Intercreditor Agreement. The First Mortgage Lender
shall have executed and delivered an intercreditor agreement in form and
substance of Exhibit G attached hereto.

                      (B) Mezzanine Loan Agreement. Mezzanine Borrower shall
have executed and delivered this Agreement to Mezzanine Lender.

                      (C) Mezzanine Note. Mezzanine Borrower shall have executed
and delivered to Mezzanine Lender the Mezzanine Note.

                      (D) Equity Pledge Agreements. Mezzanine Borrower and
Parent Pledgor shall have executed and delivered to Mezzanine Lender the Equity
Pledge Agreements, in form and substance satisfactory to Mezzanine Lender.

                      (E) Guaranty and Environmental Indemnity. Mezzanine
Borrower shall have caused the Guarantor to have executed and delivered to
Mezzanine Lender each of the Guaranty and the Environmental Indemnity.

                      (F) Mezzanine Deposit Account Agreement. Mezzanine
Borrower and Deposit Bank shall have executed and delivered to Mezzanine Lender
the Mezzanine Deposit Account Agreement in form and substance satisfactory to
Mezzanine Lender.

                      (G) Assignment of Interest Rate Cap Agreement. Mezzanine
Borrower shall have entered into the Interest Rate Cap Agreement pursuant to
Section 5.1(s) hereof and shall hereafter have executed and delivered to
Mezzanine Lender the Assignment of Interest Rate Cap Agreement in form and
substance satisfactory to Mezzanine Lender.

                      (H) Manager's Consent. Mezzanine Borrower shall have
caused the Manager to have executed and delivered to Mezzanine Lender a
Manager's Consent and Subordination of Management Agreement in form and
substance satisfactory to Mezzanine Lender.



                                       31
<PAGE>   35

                      (I) Financing Statements. Mezzanine Borrower and Parent
Pledgor shall have executed and delivered to Mezzanine Lender all financing
statements required by Mezzanine Lender and such financing statements shall have
been filed of record in the appropriate filing offices in each of the
appropriate jurisdictions.

                  (3) Opinions of Counsel. Mezzanine Lender shall have received
from counsel satisfactory to Mezzanine Lender, legal opinions in form and
substance satisfactory to Mezzanine Lender in Mezzanine Lender's discretion
regarding (A) the enforceability of the Mezzanine Loan Documents, (B) the
perfection of the security interests created under the Mezzanine Loan Documents,
and (C) substantive consolidation. All such legal opinions will be addressed to
Mezzanine Lender, its successors and assigns, dated as of the Closing Date, and
in form and substance satisfactory to Mezzanine Lender and its counsel.
Mezzanine Borrower hereby instructs counsel to deliver to Mezzanine Lender such
opinions addressed to Mezzanine Lender.

                  (4) Lien Search Reports. Mezzanine Lender shall have received
satisfactory reports of UCC, federal tax lien, bankruptcy, state tax lien,
judgment and pending litigation searches conducted by a search firm reasonably
acceptable to Mezzanine Lender. Such searches shall have been received in
relation to Mezzanine Borrower, First Mortgage Loan Borrower, Control Entity of
Mezzanine Borrower, Control Entity of First Mortgage Loan Borrower, Guarantor,
Parent Pledgor and Manager. Such searches shall have been conducted in each of
the locations designated by Mezzanine Lender in Mezzanine Lender's reasonable
discretion and shall have been dated not more than fifteen (15) days prior to
the Closing Date.

                  (5) Certificates. Mezzanine Lender shall have received a
Mezzanine Borrower's Certificate and an Officer's Certificate, in each case in
form and substance satisfactory to Mezzanine Lender.

                  (6) Consents, Licenses, Approvals. Mezzanine Lender shall have
received copies of all consents, licenses and approvals, if any, required in
connection with the execution, delivery and performance by Mezzanine Borrower
under, and the validity and enforceability of, the Mezzanine Loan Documents, and
such consents, licenses and approvals shall be in full force and effect.

                  (7) Title Insurance. (A) Mezzanine Borrower shall have
delivered to Mezzanine Lender (i) a so-called "Mezzanine Endorsement" (in form
satisfactory to Mezzanine Lender) to an existing owner's title insurance policy
issued to First Mortgage Loan Borrower which such owner's title policy shall be
reasonably acceptable to Mezzanine Lender and (ii) an "Eagle 9 Policy" or
similar policy insuring the Liens on the Collateral under the Mezzanine Loan
Documents free and clear of all liens, charges and encumbrances.

                      (B) If Mezzanine Lender exercises its right to foreclose
on the Collateral granted under one (1) or more of the Equity Pledge Agreements
following an Event of Default, Mezzanine Borrower shall (and hereby covenants
and agrees that it will) execute and deliver, and cause First Mortgage Loan
Borrower to execute and deliver, such further affidavits and indemnities as may
be required by the Title Insurer to issue the "Mezzanine Endorsement" to
Mezzanine Lender.



                                       32
<PAGE>   36

                  (8) Additional Matters. Mezzanine Lender shall have received
such other Permits, certificates, opinions, documents and instruments relating
to the Mezzanine Loan as may be required by Mezzanine Lender and all other
documents and all legal matters in connection with the Mezzanine Loan shall be
satisfactory in form and substance to Mezzanine Lender.

                  (9) Representations and Warranties. The representations and
warranties herein and in the other Mezzanine Loan Documents shall be true and
correct.

                  (10) No Injunction. No law or regulation shall have been
adopted, no order, judgment or decree of any Governmental Authority shall have
been issued or entered, and no litigation shall be pending or threatened, which
in the judgment of Mezzanine Lender would enjoin, prohibit or restrain, or
impose or result in an adverse effect upon the making or repayment of the
Mezzanine Loan or the consummation of the Transactions.

                  (11) Intentionally Omitted.

                  (12) Transaction Costs. Mezzanine Borrower shall have paid or
caused to be paid all Transaction Costs (which Mezzanine Lender is hereby
authorized to pay from the proceeds of the Mezzanine Loan).

                  (13) Insurance Coverage. Mezzanine Lender shall have received
copies of insurance policies and certificates satisfactory to Mezzanine Lender
that the insurance required under Section 5.3 has been obtained and cover the
Mezzanine Lender and its successors and assigns, as their interest may appear.

                  (b) Mezzanine Lender shall not be obligated to make the
Mezzanine Loan unless and until each of the applicable conditions precedent set
forth in this Article III is satisfied. In addition, Mezzanine Lender shall not
be obligated to make the Mezzanine Loan if a Material Adverse Condition shall
exist.

                  (c) The making of the Mezzanine Loan shall constitute, without
the necessity of specifically containing a written statement to such effect, a
confirmation, representation and warranty by Mezzanine Borrower to Mezzanine
Lender that, to the best of Mezzanine Borrower's knowledge, all of the
representations and warranties of Mezzanine Borrower set forth in the Mezzanine
Loan Documents are true and correct as of the date of the making of the
Mezzanine Loan.

                  Section 3.2. Form of Mezzanine Loan Documents and Related
Matters. The Mezzanine Loan Documents and all of the certificates, agreements,
legal opinions and other documents and papers referred to in this Article III,
unless otherwise specified, shall be delivered to Mezzanine Lender, and shall be
in form and substance satisfactory to Mezzanine Lender.

                  Section 3.3. The Accounts.

                  (a) On or before the Closing Date, Agent (or Servicer, on
Agent's behalf) shall establish and maintain an account (the "Deposit Account")
at a financial institution designated by Mezzanine Lender and reasonably
satisfactory to Mezzanine Borrower (the



                                       33
<PAGE>   37

"Deposit Bank"). The Deposit Account shall be an Eligible Account. The Deposit
Account (i) shall not be evidenced by a certificate of deposit, passbook or
other instrument, (ii) shall be one or more separate and identifiable accounts
and sub-accounts separate from all other accounts held by the Deposit Bank,
(iii) shall be established and maintained in the name of Mezzanine Borrower, as
debtor, for the benefit of Agent, as secured party, (iv) shall be under the sole
dominion and control of Agent (or Servicer, acting as Agent's agent), and (v)
shall contain only the Financial Assets deposited in accordance herewith. The
parties agree that the Deposit Account is a Securities Account in respect of
which the Deposit Bank is the Securities Intermediary and Mezzanine Borrower is
the Entitlement Holder. All Financial Assets credited to the Deposit Account
shall be registered in the name of, payable to the order of, or specially
indorsed to, the Deposit Bank.

                  (b) Mezzanine Lender shall cause Deposit Bank to agree that
each item of property (whether Investment Property, cash or other property)
credited to the Deposit Account shall be treated as a Financial Asset under
Article 8 of the UCC. Mezzanine Lender shall cause Deposit Bank to agree to
comply with all Entitlement Orders originated by the Agent without the further
consent of Mezzanine Borrower.

                  (c) Deposit Bank shall maintain on a ledger entry basis the
following subaccounts of the Deposit Account (collectively, the "Subaccounts";
and, together with the Deposit Account, collectively, the "Accounts") which
shall be designated as follows: (i) subaccount entitled Tax and Insurance
Account (the "Tax and Insurance Account"), (ii) subaccount entitled Mezzanine
Loan Debt Service Account (the "Mezzanine Loan Debt Service Account"), (iii)
subaccount entitled Cash Sweep Event Reserve Account (the "Cash Sweep Event
Reserve Account"), (iv) a subaccount entitled Extraordinary Expenses Account
(the "Extraordinary Expenses Subaccount") and (v) such other reserve accounts
currently provided under the First Mortgage Loan Documents to the extent such
reserves are no longer maintained under the First Mortgage Loan Documents.

                  (d) Subject to the terms and provisions of the First Mortgage
Loan Documents, Mezzanine Borrower shall cause the First Mortgage Loan Borrower
to irrevocably direct the First Mortgage Lender to transfer on a daily basis all
funds ("First Mortgage Borrower Remainder Funds") available to First Mortgage
Loan Borrower pursuant to Section 3.3(a)(x) of the Cash Management Agreement
between First Mortgage Loan Borrower and First Mortgage Lender of even date
herewith (the "First Mortgage Loan Cash Management Agreement") to the Deposit
Account by wire transfer of immediately available federal funds. To the extent
that the funds transferred to the Deposit Account by the next Payment Date is
less than an amount (the "Combined Monthly Payment Amount") equal to the sum of
(i) the Monthly Payment Amount, (ii) the Monthly Tax and Insurance Amount unless
such amount is reserved under the First Mortgage Loan Documents and the First
Mortgage Lender is obligated to use such reserve funds for the payment of
Impositions and Insurance and (iii) any other amounts which may be due and
payable to Mezzanine Lender under the Mezzanine Loan Documents on such date,
Mezzanine Borrower shall immediately pay such shortfall to the Deposit Account
by wire transfer of immediately available federal funds.



                                       34
<PAGE>   38

                  (e) Upon the deposit of funds into the Deposit Account,
Deposit Bank shall allocate such funds to the Subaccounts as provided under
Section 2.2 of the Mezzanine Deposit Account Agreement:

                  (f) Provided that Mezzanine Borrower deposits into the Deposit
Account on or prior to each Payment Date a sum sufficient to fund the
subaccounts described in the Mezzanine Deposit Account Agreement, Mezzanine
Borrower shall be deemed to have paid such amounts on such Payment Date, and
Deposit Bank is hereby authorized by Agent to direct on such Payment Date the
payment to Mezzanine Lender of all funds in the Mezzanine Loan Debt Service
Account, unless Deposit Bank is legally constrained from transferring such
amounts in accordance with such Section by reason of any insolvency related to
Mezzanine Borrower or any other event. Provided no Cash Sweep Event has occurred
and is continuing, after sufficient funds are on deposit in all applicable
subaccounts under the Mezzanine Deposit Account Agreement for the next Payment
Date, all Excess Cash Flow shall be transferred on a daily basis by the Deposit
Bank to Mezzanine Borrower or as Mezzanine Borrower may direct.

                  (g) To compensate the Deposit Bank for performing the
herein-described services, Mezzanine Borrower agrees to pay the usual and
customary fees charged by the Deposit Bank for performing such services.

                  Section 3.4. Tax and Insurance Account.

                  (a) At any time that tax and insurance deposits are not being
collected by First Mortgage Lender, Agent shall establish and shall maintain the
Tax and Insurance Account as a subaccount of the Deposit Account into which
Agent hereby directs the Deposit Bank to allocate certain funds from the Deposit
Account in accordance with the terms hereof.

                  (b) At any time that tax and insurance deposits are not being
collected by First Mortgage Lender subject to the provisions of Section 3.3(d)
hereof, Agent hereby directs Deposit Bank to allocate funds on Deposit in the
Deposit Account into the Tax and Insurance Account on a monthly basis on each
Payment Date in an amount (the "Monthly Tax and Insurance Amount") equal to (i)
one-twelfth (1/12) of the Impositions that Mezzanine Lender estimates (based
upon the figures set forth in the then most recent Approved Operating Budget)
will be payable during the next 12 months in order to accumulate with Mezzanine
Lender sufficient funds to pay of all such Imposition at least thirty (30) days
prior to their respective due dates, and (ii) one-twelfth (1/12) of the
Insurance premiums that Mezzanine Lender estimates will be payable for the
renewal of the coverage afforded by the Policies upon the expiration thereof in
order to accumulate with Mezzanine Lender sufficient funds to pay of all such
Insurance premiums at least thirty (30) days prior to the expiration of the
Policies. Mezzanine Borrower shall be solely responsible for paying all
Impositions and Insurance premiums or causing First Mortgage Loan Borrower to
pay such amounts not later than ten (10) Business Days prior to the respective
due dates thereof or such shorter periods required under the First Mortgage Loan
Documents. Not later than ten (10) Business Days before the due date of any such
payments, Mezzanine Borrower shall deliver to Mezzanine Lender evidence
satisfactory in Mezzanine Lender's reasonable discretion that such payments have
been made in a timely manner. Within five (5) Business Days after receipt of
such evidence, Mezzanine Lender shall direct Deposit Bank to remit to Mezzanine
Borrower the amount paid under such receipted invoices or other evidence.



                                       35
<PAGE>   39

At least thirty (30) days prior to the date that any installment of Impositions
or Insurance premiums are payable, Mezzanine Borrower shall cause a copy of any
applicable tax bills, assessments, notices and invoices related to the
Impositions and Insurance premiums (the "Documentation") to be delivered to
Mezzanine Lender. If Mezzanine Borrower fails to provide proof of payment of
Impositions or Insurance Premiums as required in this Section 3.4(b) within the
time periods set forth herein, Deposit Bank shall be entitled to fund (but shall
be under no obligation to fund) from funds then on deposit in the Tax and
Insurance Account any amounts that are due and payable in accordance with the
applicable Documentation.

                  Section 3.5. Contingent Reserve Accounts; Extraordinary
Expenses Account. Agent has established and shall maintain with the Deposit Bank
the Extraordinary Expense Account as a subaccount of the Deposit Account into
which Agent shall direct the Deposit Bank to allocate certain funds from the
Deposit Account in accordance with the terms hereof.

                  (a) To the extent the First Mortgage Lender has not under the
First Mortgage Loan Documents provided for a Operating Expense Reserve, a FF&E
Reserve, a Capital Expenditure Reserve, Self-Insurance Deficiency Reserve or in
the event the First Mortgage Loan has been repaid, Mezzanine Lender shall direct
Deposit Bank and Servicer to fund such reserves pursuant to Section 2.1 of the
Mezzanine Deposit Account Agreement. Mezzanine Lender acknowledges that all of
the aforementioned required reserves are currently provided for under the First
Mortgage Loan Documents;

                  (b) In addition, if Mezzanine Borrower has submitted
documentation with respect to Extraordinary Expenses which the Mezzanine Lender
in its reasonable discretion has approved, in whole or in part, then the
Mezzanine Lender shall direct the Deposit Bank to deposit such amounts into the
Extraordinary Expenses Subaccount to be applied in accordance with such terms
and conditions as the Mezzanine Lender may require. Notwithstanding anything to
the contrary, Mezzanine Lender agrees that Mezzanine Borrower can use Excess
Cash Flow to pay for any Extraordinary Expense without Mezzanine Lender's prior
consent provided that no Cash Sweep Event exists.

                  Section 3.6. Cash Sweep Event Reserve Account.

                  Agent has established and shall maintain with Deposit Bank the
Cash Sweep Event Reserve Account as a subaccount of the Deposit Account into
which Agent hereby directs Deposit Bank to allocate certain funds from the
Deposit Account in accordance with the terms hereof. From and after the
occurrence (and during the continuance) of a Cash Sweep Event, all Excess Cash
Flow shall be deposited in the Cash Sweep Event Reserve Account except as
otherwise provided under Section 2.12. Funds in the Cash Sweep Event Reserve
Account shall be applied in accordance with the provisions of Section 2.12(a)
hereof. Provided no Event of Default has occurred and is continuing and no funds
are available in reserves held under the First Mortgage Loan Documents for
Extraordinary Expenses or the Extraordinary Expenses Account, Mezzanine Lender
shall disburse funds from the Cash Sweep Event Reserve Account for payment of
Extraordinary Expenses, not more often than once a month, upon submission of
invoices and other documentation by Mezzanine Borrower satisfactory to Mezzanine
Lender in its reasonable judgement.



                                       36
<PAGE>   40

                  Section 3.7. Mezzanine Loan Debt Service Account.

                  Agent has established and shall maintain with Deposit Bank the
Mezzanine Loan Debt Service Account as a subaccount of the Deposit Account into
which Agent shall direct the Deposit Bank to allocate certain funds from the
Deposit Account in accordance with the terms hereof. Immediately upon Deposit
Bank's allocation thereof in accordance with Section 3.3(c)(ii) hereof, Agent
shall be authorized to direct the Deposit Bank to disburse such amounts to
Mezzanine Lender in payment of all amounts then due and payable hereunder on
such Payment Date.

                  Section 3.8. Investment and Control of Accounts.

                  (a) Funds on deposit in the Deposit Account (or its
subaccounts) shall be invested by Deposit Bank in Permitted Investments in
accordance with Entitlement Orders, and provided no Event of Default shall have
occurred and be continuing, all interest earned on amounts deposited into the
Accounts shall be held in the Accounts and shall be used or disbursed as
provided herein for the benefit of Mezzanine Borrower. Deposit Bank shall not
have any liability for any loss of interest on funds in any Accounts, and no
such loss shall affect Mezzanine Borrower's obligation to fund any Account as
required hereunder. Mezzanine Borrower hereby pledges, transfers and assigns to
Agent, and grants to Agent, as additional security for the payment and
performance of the Mezzanine Note and the obligations of Mezzanine Borrower
under the other Mezzanine Loan Documents, a continuing perfected security
interest in and to, and a general first lien upon, (i) the Deposit Account and
all Subaccounts and all of Mezzanine Borrower's right, title and interest in and
to all Deposit Account property held or maintained in, or credited to, the
Deposit Account and all Subaccounts from time to time by or on behalf of
Mezzanine Borrower in accordance with the provisions of this Agreement and (ii)
any and all replacements, substitutions and Proceeds of the foregoing (the
collateral described in the foregoing clauses (i) and (ii), collectively, the
"Account Collateral"). Mezzanine Borrower further agrees to execute,
acknowledge, deliver, file or do at its sole cost and expense, all other acts,
assignments, notices, agreements or other instruments as Agent may reasonably
require, including the execution and delivery of UCC financing statements, in
order to effectuate, assure, convey, secure, assign, transfer and convey unto
Agent any of the rights granted by this Section.

                  (b) Mezzanine Borrower represents and warrants to and for the
benefit of Agent and Mezzanine Lender that Mezzanine Borrower is the legal and
beneficial owner of the Account Collateral, free and clear of any lien, security
interest, option or other charge or encumbrance, except for the interest(s) of
Agent pursuant to this Agreement. Mezzanine Borrower shall not, without
obtaining the prior written consent of Agent, further pledge, assign or grant
any security interest in any Account, or permit any lien or encumbrance to
attach thereto, or any levy to be made thereon, or any UCC-1 Financing
Statements, except those naming Agent as the secured party, to be filed with
respect thereto. This Agreement is, among other things, intended by the parties
to be a security agreement for purposes of the Uniform Commercial Code in effect
in New York and the parties agree that the Securities Intermediary jurisdiction
with respect to the Account shall be the State of New York.



                                       37
<PAGE>   41

                  (c) Mezzanine Borrower may originate Entitlement Orders
without the further consent of Agent until the Agent notifies the Deposit Bank
that Agent (or Servicer) will exercise exclusive control over the account. Upon
receipt of such notice, the Deposit Bank will cease complying with Entitlement
Orders directed by Mezzanine Borrower.

                  (d) Agent (or Servicer, on Agent's behalf) shall have
exclusive dominion and control over and sole right of withdrawal from each of
the Accounts, which shall be exercised solely in accordance with the provisions
of this Agreement.

                  Section 3.9. Mezzanine Lender's Right to Cure First Mortgage
Loan Defaults.

                  (a) Subject to the provisions hereinafter set forth, Mezzanine
Borrower, on behalf of First Mortgage Loan Borrower, hereby authorizes Mezzanine
Lender to make, at its sole and absolute discretion, on behalf of First Mortgage
Loan Borrower any and all payments that become due and payable under the First
Mortgage Loan Documents. If three (3) Business Days prior to any First Mortgage
Loan Payment Date the amount on deposit in the cash management accounts under
the First Mortgage Loan Documents is less than the First Mortgage Loan Monthly
Payment Amount that is due and payable on the next First Mortgage Loan Payment
Date to occur, or if First Mortgage Lender is unable or unwilling to release any
or all of the funds in the cash management accounts under the First Mortgage
Loan Documents, Mezzanine Lender shall have the right, but shall be under no
obligation, to fund any such shortfall as a protective advance under the
Mezzanine Loan.

                  (b) Subject to the provisions hereinafter set forth, Mezzanine
Borrower, on behalf of First Mortgage Loan Borrower, hereby agrees that
Mezzanine Lender shall have the right to cure defaults by First Mortgage Loan
Borrower under the First Mortgage Loan Documents. From and after the occurrence
of a default under the First Mortgage Loan Documents, Mezzanine Borrower shall
cooperate in all commercially reasonable respects with, and shall cause First
Mortgage Loan Borrower to cooperate in all commercially reasonable respects with
(and not to impede or interfere with in any material respect), Mezzanine
Lender's efforts to cure (or cause the cure of) all monetary and non-monetary
defaults under the First Mortgage Loan Documents, including, without limitation,
causing the payment, removal or bonding over of all Liens, claims or judgments,
or entering upon the Property (or any portion thereof) to cure (or cause the
cure of ) any non-monetary default under the First Mortgage Loan Documents;
provided, however, that before commencing to cure any non-monetary default
Mezzanine Lender shall provide written notice to Mezzanine Borrower, and if
First Mortgage Loan Borrower intends to cure such non-monetary default Mezzanine
Lender shall permit First Mortgage Loan Borrower to pursue such cure, pursuant
to a procedure and timetable acceptable to Mezzanine Lender in its sole and
absolute discretion. In addition, after the occurrence of a default under the
First Mortgage Loan Documents, Mezzanine Borrower agrees that it will cause
First Mortgage Loan Borrower to coordinate with Mezzanine Lender with respect to
all communications (written or oral) with First Mortgage Lender (or any person
or entity servicing the First Mortgage Loan).

                  (c) Any funds expended by or on behalf of Mezzanine Lender to
effect a cure of the First Mortgage Loan as contemplated in Section 3.9(a) or
Section 3.9(b) shall constitute protective advances under the Mezzanine Loan. If
Mezzanine Lender so elects to cure (or



                                       38
<PAGE>   42

attempt to cure) any default under the First Mortgage Loan, the amount of such
expenditures made by or on behalf of Mezzanine Lender shall be added to the
Principal Indebtedness, shall accrue interest at the Default Rate and shall be
secured by the Collateral Security Instruments.

                  Section 3.10. Substitute Cash Management. In the event that
the lockbox and cash management arrangements under the First Mortgage Loan
Documents are terminated and no substitute lock box and cash management
arrangements are implemented under the First Mortgage Loan Documents while any
amount of the Debt is still outstanding, Mezzanine Borrower will at the request
of Mezzanine Lender cause the First Mortgage Loan Borrower to re-establish
similar lockbox and reserve accounts as may be required by Mezzanine Lender.

                                   ARTICLE IV

                         REPRESENTATIONS AND WARRANTIES

                  Section 4.1. Representations and Warranties of Mezzanine
Borrower.

                  (a) Organization. (i) Mezzanine Borrower (w) is a duly
organized and validly existing limited liability company in good standing in the
laws of the State of Delaware, (x) is duly qualified as a foreign limited
liability company in each jurisdiction in which the nature or location of its
business, its assets, the Property or any of the Collateral makes such
qualification necessary or desirable, (y) has the requisite limited liability
company power and authority to carry on its business as now being conducted, and
(z) has the requisite limited liability company power to execute and deliver,
and perform its obligations under, the Mezzanine Loan Documents to which it is a
party.

                      (ii) Parent Pledgor (w) is a duly organized and validly
existing corporation in good standing under the laws of the State of Delaware,
(x) is duly qualified as a foreign corporation in each jurisdiction in which the
nature or location of its business, its assets, the Property or any of the
Collateral makes such qualification necessary or desirable, (y) has the
requisite corporate power and authority to carry on its business as now being
conducted, and (z) has the requisite corporate power to execute and deliver, and
perform its obligations under, the Mezzanine Loan Documents and the Equity
Pledge Agreements to which it is a party.

                      (iii) Manager (w) is a duly organized and validly existing
limited liability company in good standing under the laws of the State of
Tennessee, (x) is duly qualified as a foreign limited liability company in each
jurisdiction in which the nature or location of its business, its assets, the
Property or any of the Collateral makes such qualification necessary or
desirable, (y) has the requisite limited liability company power and authority
to carry on its business as now being conducted, and (z) has the requisite
limited liability company power to execute and deliver, and perform its
obligations under, the Mezzanine Loan Documents and the to which it is a party.

                      (iv) Control Entity of Mezzanine Borrower (w) is a duly
organized and validly existing corporation in good standing under the laws of
the State of Delaware, (x) is duly qualified as a foreign corporation in each
jurisdiction in which the nature or location of its business or its assets,
makes such qualification necessary or desirable, (y) has the requisite



                                       39
<PAGE>   43

corporate power and authority to carry on its business as now being conducted,
and (z) has the requisite corporate power to execute and deliver, and perform
its obligations under, the operating agreement of Mezzanine Borrower.

                  (b) Authorization. The execution and delivery by Mezzanine
Borrower of the Mezzanine Loan Documents, the performance of its obligations
thereunder and the creation of the security interests and Liens provided for in
the Mezzanine Loan Documents (i) have been duly authorized by all requisite
Entity action on the part of Mezzanine Borrower, (ii) will not violate any
provision of any applicable Legal Requirements, any order, writ, decree,
injunction or demand of any court or other Governmental Authority, any
organizational document of Mezzanine Borrower or any indenture or agreement or
other instrument to which Mezzanine Borrower is a party or by which Mezzanine
Borrower is bound, (iii) will not be in conflict with, result in a breach of, or
constitute (with due notice or lapse of time or both) a default under, or result
in the creation or imposition of any Lien of any nature whatsoever upon any of
the property or assets of Mezzanine Borrower pursuant to, any indenture or
agreement or instrument, and (iv) have been duly executed and delivered by
Mezzanine Borrower. Except for those obtained or filed on or prior to the
Closing Date, Mezzanine Borrower is not required to obtain any consent, approval
or authorization from, or to file any declaration or statement with, any
Governmental Authority or other agency in connection with or as a condition to
the execution, delivery or performance of the Mezzanine Loan Documents. The
Mezzanine Loan Documents to which Mezzanine Borrower, First Mortgage Loan
Borrower or Manager is a party have been duly authorized, executed and delivered
by such parties.

                  (c) Entity Status. Mezzanine Borrower has been, and will
continue to be, a duly formed and existing Entity in good standing in all
relevant jurisdictions. Mezzanine Borrower at all times since its formation has
complied, and will continue to comply, with the provisions of all of its
organizational documents, and the laws of the state in which Mezzanine Borrower
was formed or is doing business relating to the Entity.

                  (d) Litigation. Except as set forth on Schedule 4.1(d), there
are no actions, suits or proceedings at law or in equity by or before any court
or other Governmental Authority or other governmental agency now pending and
served or, to the knowledge of Mezzanine Borrower, threatened against Mezzanine
Borrower, First Mortgage Loan Borrower, Manager or the Property. No existing
litigation if adversely determined is reasonably expected to cause a Material
Adverse Condition.

                  (e) Agreements. Mezzanine Borrower is not a party to any
agreement or instrument or subject to any restriction which is likely to result
in a Material Adverse Condition. Mezzanine Borrower is not in default in any
respect in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any indenture, agreement or instrument to
which it is a party or by which Mezzanine Borrower or the Property is bound,
which default could reasonably be expected to result in a Material Adverse
Condition.

                  (f) No Bankruptcy Filing. Mezzanine Borrower is not
contemplating either the filing of a petition by Mezzanine Borrower under any
state or federal bankruptcy or insolvency laws or the liquidation of all or a
major portion of Mezzanine Borrower's assets or



                                       40
<PAGE>   44

property, and Mezzanine Borrower has no knowledge of any Person contemplating
the filing of any such petition against Mezzanine Borrower.

                  (g) Full and Accurate Disclosure. No statement of fact made by
or on behalf of Mezzanine Borrower or First Mortgage Loan Borrower or in the
Mezzanine Loan Documents or in any other material document or Officer's
Certificate delivered to Mezzanine Lender by or on behalf of Mezzanine Borrower
contains any untrue statement of a material fact or omits to state any material
fact necessary to make statements contained herein or therein not misleading.
There is no fact presently known to Mezzanine Borrower which has not been
disclosed to Mezzanine Lender which materially adversely affects, nor as far as
Mezzanine Borrower can reasonably foresee, might materially adversely affect the
business, operations or condition (financial or otherwise) of Mezzanine Borrower
or First Mortgage Loan Borrower.

                  (h) Location of Chief Executive Offices. The location of
Mezzanine Borrower's principal place of such business and the location of
Mezzanine Borrower's chief executive office is the address listed in the first
paragraph of this Agreement, and Mezzanine Borrower has no other places of
business, except for the Property.

                  (i) Compliance. Mezzanine Borrower, the Property and First
Mortgage Loan Borrower's use thereof and operations thereat comply with all
applicable Legal Requirements and all Insurance Requirements except where the
failure to be in compliance could not reasonably be expected to result in a
Material Adverse Condition. Neither First Mortgage Loan Borrower nor Mezzanine
Borrower is in default or violation of any order, writ, injunction, decree or
demand of any Governmental Authority.

                  (j) Other Debt and Obligations. Neither First Mortgage Loan
Borrower nor Mezzanine Borrower has any financial obligation under any
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which Mezzanine Borrower or First Mortgage Loan Borrower is a
party, or by which Mezzanine Borrower or First Mortgage Loan Borrower is bound,
other than (x) with respect to First Mortgage Loan Borrower, the obligations
under the First Mortgage Loan, (y) with respect to Mezzanine Borrower, the
obligations under the Mezzanine Loan Documents and (z) the Permitted
Indebtedness. Neither First Mortgage Loan Borrower nor Mezzanine Borrower has
borrowed or received other debt financing (other than the First Mortgage Loan
and Mezzanine Loan, respectively) that has not been heretofore repaid in full,
and neither First Mortgage Loan Borrower nor Mezzanine Borrower has any known
Contingent Obligations.

                  (k) ERISA. Each Plan and, to the knowledge of Mezzanine
Borrower, each Multiemployer Plan, is in compliance in all material respects
with, and has been administered in all material respects in compliance with, its
terms and the applicable provisions of ERISA, the Code and any other federal or
state law, and no event or condition has occurred as to which Mezzanine Borrower
would be under an obligation to furnish a report to Mezzanine Lender under
Section 5.1(k).

                  (l) Solvency. Mezzanine Borrower has not entered into this
Mezzanine Loan Agreement or any Mezzanine Loan Document with the actual intent
to hinder, delay, or defraud any creditor, and Mezzanine Borrower has received
reasonably equivalent value in exchange for



                                       41
<PAGE>   45

its obligations under the Mezzanine Loan Documents. Giving effect to the
transactions contemplated hereby, the fair saleable value of Mezzanine
Borrower's assets exceeds and will, immediately following the execution and
delivery of this Agreement, exceed Mezzanine Borrower's total liabilities,
including, without limitation, subordinated, unliquidated, or disputed
liabilities or Contingent Obligations. The fair saleable value of Mezzanine
Borrower's assets is and will, immediately following the execution and delivery
of this Agreement, be greater than Mezzanine Borrower's probable liabilities,
including the maximum amount of its Contingent Obligations or its debts as such
debts become absolute and matured. Mezzanine Borrower's assets do not and,
immediately following the execution and delivery of this Agreement, will not,
constitute unreasonably small capital to carry out its business as conducted or
as proposed to be conducted. Mezzanine Borrower does not intend to, nor does
Mezzanine Borrower believe that it will, incur debts and liabilities (including,
without limitation, Contingent Obligations and other commitments) beyond its
ability to pay such debts as they mature (taking into account the timing and
amounts to be payable on or in respect of obligations of Mezzanine Borrower).

                  (m) Not Foreign Person. Mezzanine Borrower is not a "foreign
person" within the meaning ofss.1445(f)(3) of the Code.

                  (n) Investment Company Act, Public Utility Holding Company
Act. Mezzanine Borrower is not (i) an "investment company" or a company
"controlled" by an "investment company," within the meaning of the Investment
Company Act of 1940, as amended, (ii) a "holding company" or a "subsidiary
company" of a "holding company" or an "affiliate" of either a "holding company"
or a "subsidiary company" within the meaning of the Public Utility Holding
Company Act of 1935, as amended, or (iii) subject to any other federal or state
law or regulation which purports to restrict or regulate its ability to borrow
money.

                  (o) No Defaults. No Default or Event of Default exists under
or with respect to any Mezzanine Loan Document.

                  (p) Labor Matters. Mezzanine Borrower is not a party to any
collective bargaining agreements.

                  (q) Title to the Collateral. Mezzanine Borrower owns good,
indefeasible and marketable title to the Collateral free and clear of all Liens.

                  (r) Use of Proceeds: Margin Regulations. Mezzanine Borrower
will use the proceeds of the Mezzanine Loan for the purposes described herein.
No part of the proceeds of the Mezzanine Loan will be used for the purpose of
purchasing or acquiring any "margin stock" within the meaning of Regulation U of
the Board of Governors of the Federal Reserve System or for any other purpose
which would be inconsistent with such Regulation U or any other Regulations of
such Board of Governors, or for any purposes prohibited by applicable Legal
Requirements.

                  (s) Financial Information. To the best knowledge of Mezzanine
Borrower, all historical financial data concerning Mezzanine Borrower, First
Mortgage Loan Borrower and the Property that has been delivered by or on behalf
of Mezzanine Borrower to Mezzanine Lender is true, complete and correct in all
material respects. Since December 31, 2000, except as



                                       42
<PAGE>   46

otherwise disclosed in writing to Mezzanine Lender, there has been no material
adverse change in the financial position of Mezzanine Borrower, First Mortgage
Loan Borrower or the Property, or in the results of operations of Mezzanine
Borrower or First Mortgage Loan Borrower. Neither First Mortgage Loan Borrower
nor Mezzanine Borrower has incurred any obligation or liability, contingent or
otherwise, not reflected in such financial data which might reasonably be
expected to materially and adversely affect its business operations or the
Property.

                  (t) Condemnation. No Taking has been commenced or, to
Mezzanine Borrower's knowledge, is contemplated with respect to all or any
portion of the Property or for the relocation of roadways providing access to
the Property.

                  (u) Utilities and Public Access. The Property has adequate
rights of access to public ways and is served by adequate water, sewer, sanitary
sewer and storm drain facilities as are adequate for full utilization of the
Property for its current purpose. Except as otherwise disclosed by the surveys
delivered to Mezzanine Lender prior to the Closing Date, all public utilities
necessary to the continued use and enjoyment of the Property as presently used
and enjoyed are located in valid, enforceable easements (which are superior to
any mortgages or other liens affecting the real property which they encumber) or
the public right-of-way abutting the Property, and all such utilities are
connected so as to serve the Property either (i) without passing over other
property or, (ii) if such utilities pass over other property, pursuant to valid
easements. All roads necessary for the full utilization of the Property for its
current purpose have been completed and dedicated to public use and accepted by
all Governmental Authorities or are the subject of access easements for the
benefit of the Property.

                  (v) No Joint Assessment: Separate Lots. Mezzanine Borrower has
not and Mezzanine Borrower shall not cause or suffer First Mortgage Loan
Borrower to consent to or initiate the joint assessment of the Property (i) with
any other real property constituting a separate tax lot, and (ii) with any
portion of the Property which may be deemed to constitute personal property, or
any other procedure whereby the lien of any taxes which may be levied against
such personal property shall be assessed or levied or charged to the Property as
a single lien. The Property is comprised of one or more parcels, each of which
constitutes a separate tax lot and none of which constitutes a portion of any
other tax lot.

                  (w) Assessments. There are no pending or, to the knowledge of
Mezzanine Borrower, proposed special or other assessments for public
improvements or otherwise affecting the Property, nor, to the knowledge of
Mezzanine Borrower, are there any contemplated improvements to the Property that
may result in such special or other assessments.

                  (x) Enforceability. The Mezzanine Loan Documents executed by
Mezzanine Borrower or any of its Affiliates in connection with the Mezzanine
Loan, including, without limitation, any Equity Pledge Agreement, are the legal,
valid and binding obligations of Mezzanine Borrower or such Affiliate, that is a
party thereto, enforceable against Mezzanine Borrower or such Affiliate in
accordance with their terms, subject only to bankruptcy, insolvency and other
limitations on creditors' rights generally and to equitable principles. Such
Mezzanine Loan Documents are, as of the Closing Date, not subject to any right
of rescission, set-off, counterclaim or defense by Mezzanine Borrower or such
Affiliate, including the defense of usury, nor will the operation of any of the
terms of the Mezzanine Note, or any other Mezzanine



                                       43
<PAGE>   47

Loan Documents, or the exercise of any right thereunder, render the Mezzanine
Loan Documents unenforceable against Mezzanine Borrower or such Affiliate, in
whole or in part, or subject to any right of rescission, set-off, counterclaim
or defense by Mezzanine Borrower or such Affiliate, including the defense of
usury, and neither Mezzanine Borrower nor any Affiliate of Mezzanine Borrower
has asserted any right of rescission, set-off, counterclaim or defense with
respect thereto.

                  (y) No Indebtedness. Mezzanine Borrower has no Indebtedness
including, without limitation, known Contingent Obligations (and including,
without limitation, liabilities or obligations in tort, in contract, at law, in
equity, pursuant to a statute or regulation, or otherwise) other than
Indebtedness expressly permitted by this Agreement.

                  (z) Leases. Attached hereto as Schedule 1 is a true, correct
and complete rent roll for the Property (the "Rent Roll"), which includes all
Leases (except for Deminimis Leases) affecting the Property. Except as set forth
in Schedule 1 (and except for Deminimis Leases), as of the date of the Rent
Roll: (i) each Lease is in full force and effect; (ii) the Tenants under the
Leases have accepted possession of and are in occupancy of all of their
respective demised premises, have commenced the payment of rent under such
Leases, and there are no offsets, claims or defenses to the enforcement thereof,
(iii) all rents due and payable under the Leases have been paid, and no portion
thereof has been paid for any period more than thirty (30) days in advance; (iv)
the base rent payable under each Lease is the amount of fixed rent set forth in
the Rent Roll, and there is no claim or, to the knowledge of Mezzanine Borrower,
basis for a claim by the Tenant thereunder for an adjustment to the rent; (v) to
the best knowledge of Mezzanine Lender no Tenant has made any set-off, defense
or claim against the landlord under the Leases which remains outstanding; (vi)
to Mezzanine Borrower's best knowledge, there is no present material default by
the Tenant under any Lease; and (vii) Mezzanine Borrower or First Mortgage Loan
Borrower does not hold any security deposits under the Leases. None of the
Leases contains any option to purchase or right of first refusal to purchase the
Property or any part thereof. Neither the Leases nor the rents have been
assigned or pledged except to First Mortgage Lender and to Mezzanine Lender, and
no other Person has any interest therein except the Tenants thereunder.

                  (aa) Flood Zone. Except as set forth on the Survey (as defined
in the First Mortgage Loan Agreement), no buildings or other improvements on the
Property are located in a flood hazard area as designated by the Federal
Emergency Management Agency.

                  (bb) Physical Condition. Except as set forth in the Property
Condition Report delivered to Mezzanine Lender, to the best knowledge of
Mezzanine Borrower, the Property is free of material structural defects and all
building systems contained therein are in good working order in all material
respects subject to ordinary wear and tear.

                  (cc) Security Deposits. Mezzanine Borrower and First Mortgage
Loan Borrower are in compliance with all applicable Legal Requirements relating
to security deposits.

                  (dd) Conduct of Business. Mezzanine Borrower does not conduct
its business "also known as", "doing business as" or under any name other than
the name referred to on the first page of this Agreement.



                                       44
<PAGE>   48

                  (ee) Ownership Interests. As shown on the organizational chart
attached hereto as Exhibit A, the ownership interests of First Mortgage Loan
Borrower and Mezzanine Borrower are as follows:

                  (i) OHN Management, Inc. is the sole non-member independent
manager of First Mortgage Loan Borrower. All of the interests of OHN Management,
Inc. in First Mortgage Loan Borrower are owned free and clear of all Liens,
warrants and options to purchase. Gaylord Entertainment Company is the sole
shareholder of, and owns 100% of the outstanding stock in OHN Management, Inc.
Gaylord Entertainment Company's stock in OHN Management, Inc. is owned free and
clear of all Liens, warrants and options to purchase (other than Liens created
by the Mezzanine Loan Documents).

                  (ii) Mezzanine Borrower owns a 100% membership interest in
First Mortgage Loan Borrower and is the sole member in First Mortgage Loan
Borrower. Mezzanine Borrower's membership interests in First Mortgage Loan
Borrower are owned free and clear of all Liens, warrants and options to purchase
(other than Liens created by the Mezzanine Loan Documents).

                  (iii) Gaylord Entertainment Company is the sole member of, and
owns 100% of the outstanding membership interests in, Mezzanine Borrower free
and clear of all Liens, warrants and options to purchase. OHN Holdings
Management, Inc. is the sole independent non-member manager of Mezzanine
Borrower.

                  (iv) No parties other than OHN Management, Inc. and Mezzanine
Borrower own general or limited partnership interests in First Mortgage Loan
Borrower. Neither OHN Management, Inc. nor Mezzanine Borrower have any
obligation to any Person to purchase, repurchase or issue any ownership interest
in such Person.

                  (ff) Management Agreement. The Management Agreement is in full
force and effect. There is no default, breach or violation existing under the
Management Agreement, and no event has occurred (other than payments due but not
yet delinquent) that, with the passage of time or the giving of notice, or both,
would constitute a default, breach or violation thereunder, by either party
thereto.

                  (gg) Hazardous Substances. To the best of Mezzanine Borrower's
knowledge, except as described in the Environmental Report, (i) the Property is
not in violation of any Legal Requirement pertaining to or imposing liability or
standards of conduct concerning environmental regulation, contamination or
clean-up, including the Comprehensive Environmental Response, Compensation and
Liability Act, the Resource Conservation and Recovery Act, the Emergency
Planning and Community Right-to-Know Act of 1986, the Hazardous Substances
Transportation Act, the Solid Waste Disposal Act, the Clean Water Act, the Clean
Air Act, the Toxic Substance Control Act, the Safe Drinking Water Act, the
Occupational Safety and Health Act, any state super-lien and environmental
clean-up statutes and all amendments to and regulations in respect of the
foregoing laws (collectively, "Environmental Laws"); (ii) the Property is not
subject to any private or governmental Lien or judicial or administrative notice
or action or inquiry, investigation or claim relating to hazardous, toxic,
dangerous and/or regulated substances, wastes, materials, raw materials which
include



                                       45
<PAGE>   49

hazardous constituents, pollutants or contaminants, including asbestos, asbestos
containing materials, petroleum, tremolite, anthlophylite, actinolite,
polychlorinated biphenyls and any other substances or materials which are
included under or regulated by Environmental Laws (collectively, "Hazardous
Substances"); (iii) no Hazardous Substances are or have been (including the
period prior to First Mortgage Loan Borrower's acquisition of the Property),
discharged, generated, treated, disposed of or stored on, incorporated in, or
removed or transported from the Property other than in compliance with all
Environmental Laws; (iv) no Hazardous Substances are present in, on or under any
nearby real property which could migrate to or otherwise affect the Property;
and (v) no underground storage tanks exist on the Property.

                  (hh) Special Purpose Bankruptcy Remote Entities. Each of First
Mortgage Loan Borrower, Control Entity of First Mortgage Loan Borrower, Control
Entity of Mezzanine Borrower, and Mezzanine Borrower is a Special Purpose
Bankruptcy Remote Entity.

                  Section 4.2. Survival of Representations and Warranties.
Mezzanine Borrower agrees that (i) all of the representations and warranties of
Mezzanine Borrower and its Affiliates set forth in this Agreement and in the
other Mezzanine Loan Documents delivered on the Closing Date are made as of the
Closing Date (except as expressly otherwise provided) and (ii) all
representations and warranties made by Mezzanine Borrower and its Affiliates
shall survive the delivery of the Mezzanine Note and continue for so long as any
amount remains owing to Mezzanine Lender under this Agreement, the Mezzanine
Note or any of the other Mezzanine Loan Documents. All representations,
warranties, covenants and agreements made by Mezzanine Borrower in this
Agreement or in the other Mezzanine Loan Documents shall be deemed to have been
relied upon by Mezzanine Lender.

                                   ARTICLE V

                              AFFIRMATIVE COVENANTS

                  Section 5.1. Mezzanine Borrower Covenants. Mezzanine Borrower
covenants and agrees that, from the date hereof and until payment in full of the
Debt:

                  (a) Existence; Compliance with Legal Requirements, Insurance.
Mezzanine Borrower shall do or cause to be done with respect to itself and First
Mortgage Loan Borrower all things necessary to preserve, renew and keep in full
force and effect the Entity existence, rights, licenses, Permits and franchises
necessary for the conduct of the business of such entities and comply in all
respects with all applicable Legal Requirements applicable to such entities and
the Collateral. Mezzanine Borrower shall notify Mezzanine Lender promptly of any
written notice or order that Mezzanine Borrower receives from any Governmental
Authority relating to Mezzanine Borrower's or any of its Affiliates' failure to
comply with such applicable Legal Requirements which could reasonably be
expected to result in a Material Adverse Condition. Mezzanine Borrower shall at
all times and shall cause First Mortgage Loan Borrower at all times to maintain,
preserve and protect all franchises and trade names and preserve all the
remainder of their respective property necessary for the continued conduct of
their respective businesses.

                  (b) Litigation. Mezzanine Borrower shall give prompt written
notice to Mezzanine Lender of any litigation or governmental proceedings pending
or threatened against



                                       46
<PAGE>   50

either Mezzanine Borrower or First Mortgage Loan Borrower which could reasonably
be expected to result in a Material Adverse Condition.

                  (c) Taxes and Other Charges. Mezzanine Borrower shall pay, or
cause to be paid, all Impositions, and deliver to Mezzanine Lender receipts for
payment or other evidence satisfactory to Mezzanine Lender that the Impositions
have been so paid no later than twenty (20) Business Days before they would be
delinquent if not paid or such shorter period as required under the First
Mortgage Loan Agreement. Mezzanine Borrower shall not suffer and shall promptly
cause to be paid and discharged any Lien (other than Permitted Indebtedness)
against the Property, and shall promptly pay for all utility services provided
to the Property. After prior notice to Mezzanine Lender, Mezzanine Borrower, at
its own expense, may contest, or cause First Mortgage Loan Borrower to contest,
by appropriate legal proceeding, promptly initiated and conducted in good faith
and with due diligence, the amount or validity or application of any Liens or
Impositions, provided that (i) no Default or Event of Default has occurred and
remains uncured, (ii) such proceeding shall suspend the collection of the
Impositions, (iii) such proceeding shall be permitted under and be conducted in
accordance with the provisions of any other instrument to which Mezzanine
Borrower or First Mortgage Loan Borrower is subject and shall not constitute a
default thereunder, (iv) no part of or interest in the Property will be in
danger of being sold, forfeited, terminated, canceled or lost, (v) Mezzanine
Borrower or First Mortgage Loan Borrower shall have furnished such security as
may be required in the proceeding, or as may be requested by Mezzanine Lender,
to insure the payment of any such Impositions, together with all interest and
penalties thereon, and (vi) Mezzanine Borrower or First Mortgage Loan Borrower
shall promptly upon final determination thereof pay the amount of such
Impositions, together with all costs, interest and penalties. Mezzanine Lender
may pay over any such cash deposit or part thereof held by Mezzanine Lender to
the claimant entitled thereto at any time when, in the reasonable judgment of
Mezzanine Lender, the entitlement of such claimant is established and the sale
or forfeiture of the Property or any Collateral is threatened. If Mezzanine
Borrower or First Mortgage Loan Borrower contests the amount of validity or
application of any Liens or Impositions in accordance with the provisions of the
First Mortgage Loan Documents, the provisions regarding contests in this Section
5.1(c) shall be deemed satisfied.

                  (d) Repairs; Maintenance and Compliance. Mezzanine Borrower
shall cause the Property to be maintained in a good and safe condition and
repair and, except as permitted under the Approved FF&E Budget or the First
Mortgage Loan Documents, shall not remove, demolish or materially alter the
Improvements or Equipment without the prior written consent of Mezzanine Lender,
not to be unreasonably withheld or delayed (except for normal replacement of the
Equipment, repair and replacement of Improvements damaged by events of casualty
or alterations required to comply with Leases approved in accordance with the
terms hereof). Mezzanine Borrower shall promptly comply, and shall cause First
Mortgage Loan Borrower to comply, with all Legal Requirements applicable to
either of them or the Property and cure properly any violation of a Legal
Requirement within sixty (60) days of delivery of notice of such violation or
such lesser period required therein, provided that Mezzanine Borrower shall have
the right to contest such violation, at its sole cost and expense, in which case
such period shall be continued as necessary to complete any such contest,
provided further that Mezzanine Borrower shall comply with the provisions
regarding contests set forth in Section 5.1(c) above. Mezzanine Borrower shall
or shall cause First Mortgage Loan Borrower to promptly repair,



                                       47
<PAGE>   51

replace or rebuild any part of the Property that becomes damaged, worn or
dilapidated and shall complete and pay for any Improvements at any time in the
process of construction or repair.

                  (e) Performance of Other Agreements. Mezzanine Borrower shall
observe and perform or cause to be observed and performed each and every term to
be observed or performed by Mezzanine Borrower or First Mortgage Loan Borrower
pursuant to the terms of any material agreement or recorded instrument affecting
or pertaining to the Property, including, without limitation, the First Mortgage
Loan Documents.

                  (f) Notice of Default. Mezzanine Borrower shall promptly
notify Mezzanine Lender in writing of any material adverse change in Mezzanine
Borrower's or First Mortgage Loan Borrower's condition, financial or otherwise,
or of the occurrence of any Default or Event of Default of which Mezzanine
Borrower has knowledge. In addition, Mezzanine Borrower shall notify Mezzanine
Lender in writing not later than one (1) Business Day after receipt of any
notice from First Mortgage Lender alleging the occurrence of any event of
default under the First Mortgage Loan Documents or of any event which, with the
giving of notice and/or the passage of time would result in the occurrence of an
event of default under the First Mortgage Loan Documents.

                  (g) Cooperate in Legal Proceedings. Except with respect to any
claim by Mezzanine Borrower against Mezzanine Lender, Mezzanine Borrower shall
cooperate with Mezzanine Lender with respect to any proceedings before any
Governmental Authority which may in any way affect the rights of Mezzanine
Lender hereunder or any rights obtained by Mezzanine Lender under any of the
Mezzanine Loan Documents and, in connection therewith, not prohibit Mezzanine
Lender, at its election, from participating in any such proceedings.

                  (h) Perform Mezzanine Loan Documents. Mezzanine Borrower shall
observe, perform and satisfy all the terms, provisions, covenants and conditions
required to be observed, performed or satisfied by it, and shall pay when due
all costs, fees and expenses required to be paid by it, under the Mezzanine Loan
Documents executed and delivered by Mezzanine Borrower.

                  (i) Further Assurances. Mezzanine Borrower shall, at Mezzanine
Borrower's sole cost and expense:

                      (1) upon Mezzanine Lender's request therefor given from
         time to time after the occurrence of any Default or Event of Default
         pay for reports of UCC, federal tax lien, state tax lien, judgment and
         pending litigation searches with respect to Mezzanine Borrower, First
         Mortgage Loan Borrower and the Property;

                      (2) furnish to Mezzanine Lender all instruments,
         documents, certificates, and agreements required to be furnished
         pursuant to the terms of the Mezzanine Loan Documents;

                      (3) execute and deliver to Mezzanine Lender such
         documents, instruments, certificates, assignments and other writings,
         and do such other acts necessary or desirable, to evidence, preserve
         and/or protect the Collateral at any time securing or intended to
         secure the Mezzanine Loan as Mezzanine Lender may require in Mezzanine



                                       48
<PAGE>   52
         Lender's reasonable discretion, including, without limitation, the
         filing of any financing or continuation statements under the UCC with
         respect to the Collateral, transferring the Collateral to Mezzanine
         Lender's possession (if a security interest in such Collateral can be
         perfected by possession) and endorsing to Mezzanine Lender any
         Collateral which may be evidenced by an instrument and executing and
         delivering any and all affidavits, certificates or similar documents
         required by any title insurance company as a condition to its issuing
         or continuing to maintain any insurance covering Mezzanine Lender's
         interest in the Property or any other Collateral, including, without
         limitation, a "fairway" or non-imputation endorsement; and

                      (4) do and execute, and cause First Mortgage Loan Borrower
         to the extent not prohibited under the First Mortgage Loan Documents to
         do and execute, all such further lawful acts, conveyances and
         assurances for the better and more effective carrying out of the
         intents and purposes of this Agreement and the other Mezzanine Loan
         Documents, as Mezzanine Lender shall reasonably require from time to
         time in its discretion.

                  (j) Financial Statements; Budgets, Audit Rights. Until payment
in full of the Debt, Mezzanine Borrower shall cause the following financial
statements and information, in form and substance satisfactory to Mezzanine
Lender, to be delivered to Mezzanine Lender as and when hereinafter provided:

                      (1) ANNUAL REPORTING. Within ninety (90) days after the
         end of each calendar year, Mezzanine Borrower, Guarantor and First
         Mortgage Loan Borrower shall each provide true and complete copies of
         its Financial Statements for such year to Mezzanine Lender. All such
         statements shall be audited by a Big Five Accounting Firm or by other
         independent certified public accountants reasonably acceptable to
         Mezzanine Lender, and shall bear the unqualified certification of such
         accountants that such statements present fairly in all material
         respects the financial position of the subject company. The annual
         Financial Statements shall be accompanied by Supplemental Financial
         Information (as such term is defined in the First Mortgage Loan
         Agreement) for such calendar year. The annual Financial Statements for
         Mezzanine Borrower, Guarantor and First Mortgage Loan Borrower shall
         also be accompanied by a certification executed by the entity's chief
         executive officer or chief financial officer, satisfying the criteria
         set forth in Section 5.1(j)(8) below, and a Compliance Certificate (as
         defined below).

                      (2) QUARTERLY REPORTING - MEZZANINE BORROWER. Within
         forty-five (45) days after the end of the first, second and third
         calendar quarters of each year, Mezzanine Borrower shall provide true
         and complete copies of its balance sheet and the First Mortgage Loan
         Borrower's balance sheet as of the end of such quarter to Mezzanine
         Lender, together with a certification executed on behalf of Mezzanine
         Borrower by its chief executive officer or chief financial officer in
         accordance with the criteria set forth in Section 5.1(j)(8) below. If
         requested by Mezzanine Lender, Mezzanine Borrower shall cause the First
         Mortgage Loan Borrower to provide a report on variances from the
         Approved Operating Budget and Approved FF&E Budget with respect to the
         Property.



                                       49
<PAGE>   53

                      (3) QUARTERLY REPORTING - GUARANTOR. Within forty-five
         (45) days after the end of each first, second and third calendar
         quarters of each year, Guarantor shall provide true and complete copies
         of its Financial Statements for such quarter to Mezzanine Lender,
         together with a certification executed on behalf of Guarantor by its
         chief executive officer or chief financial officer in accordance with
         the criteria set forth in Section 5.1(j)(8) below and a Compliance
         Certificate.

                      (4) LEASING REPORTS. Within forty-five (45) days after
         each calendar quarter, Mezzanine Borrower shall provide to Mezzanine
         Lender a certified Rent Roll and a schedule of security deposits held
         under Leases (other than De minimis Leases), each in form and substance
         reasonably acceptable to Mezzanine Lender. Within forty-five (45) days
         after each calendar quarter, Mezzanine Borrower shall also provide to
         Mezzanine Lender (a) a schedule of any retail Leases (other than De
         minimis Leases) that expired during such calendar quarter and a
         schedule of retail Leases (other than De minimis Leases) scheduled to
         expire within the next twelve (12) months, (b) to the extent Mezzanine
         Borrower received notice thereof, a list of any retail tenants (other
         than De minimis Leases) that filed bankruptcy, insolvency or
         reorganization proceedings during such calendar quarter. Within ninety
         (90) days after the end of each calendar year, Mezzanine Borrower shall
         provide to Mezzanine Lender a statement of income and expenses for all
         retail space in the Property (including space leased to retail tenants
         and retail space operated by Mezzanine Borrower or Manager only for
         owned and operated retail outlets and sales report for other leased
         spaces) for such year.

                      (5) MONTHLY REPORTING. Within (30) days after the end of
         each calendar month (except that monthly reports for the month of
         December will be within forty-five (45) days), Mezzanine Borrower shall
         provide to Mezzanine Lender the following items determined on an
         accrual basis: (i) a calculation of the average daily rate, RevPAR and
         occupancy calculations and statistics for the Property for the subject
         month; (ii) Smith Travel Research "STAR" reports then available; (iii)
         monthly and year to date operating statements prepared for each
         calendar month, noting Net Operating Income and including budgeted and
         last year results for the same year-to-date period and other
         information necessary and sufficient under GAAP to fairly represent the
         financial position and results of operation of the Property during such
         calendar month, all in form satisfactory to Mezzanine Lender; (iv) a
         calculation reflecting the annual Net Operating Income, Debt Service
         Coverage Ratio and Debt Yield for the immediately preceding twelve (12)
         month period as of the last day of each such month; (v) an updated
         summary of advance bookings information (excluding customer names); and
         (vi) capital expenditure/FF&E reports with respect to such calendar
         month. Along with such statements, Mezzanine Borrower shall deliver to
         Mezzanine Lender a certification of Mezzanine Borrower's chief
         executive officer or chief financial officer satisfying the criteria
         set forth in Section 5.1(j)(8) below and a Compliance Certificate.

                      (6) ADDITIONAL REPORTING. In addition to the foregoing,
         Mezzanine Borrower, Guarantor and Manager shall each promptly provide
         to Lender such further documents and information concerning its
         operations, properties, ownership, and finances as Mezzanine Lender
         shall from time to time reasonably request. Notwithstanding anything
         herein to the contrary, Mezzanine Lender reserves the right to require
         the



                                       50
<PAGE>   54

         Mezzanine Borrower to provide an unaudited balance sheet of
         Mezzanine Borrower, dated as of March 31, 2001 and deliver a
         certification of Mezzanine Borrower's chief executive officer or chief
         financial officer satisfying the criteria set forth in Section
         5.1(j)(8) below.

                      (7) GAAP; USAH. Mezzanine Borrower and Guarantor will
         maintain systems of accounting established and administered in
         accordance with sound business practices and sufficient in all respects
         to permit preparation of Financial Statements in conformity with GAAP
         and the USAH. All Financial Statements shall be prepared in accordance
         with GAAP and the USAH, consistently applied; provided, however, in the
         event of a conflict between the USAH and GAAP, GAAP will be followed.

                      (8) CERTIFICATIONS OF FINANCIAL STATEMENTS AND OTHER
         DOCUMENTS, COMPLIANCE CERTIFICATE. Together with the Financial
         Statements and other documents and information provided to Mezzanine
         Lender by or on behalf of Mezzanine Borrower, Guarantor and First
         Mortgage Loan Borrower under this Section, Mezzanine Borrower and
         Guarantor also shall deliver to Mezzanine Lender a certification in
         form and substance satisfactory to Mezzanine Lender, executed on behalf
         of such Person by its chief executive officer or chief financial
         officer, stating that such Financial Statements, documents and
         information are true, correct, accurate and complete and fairly present
         the financial condition and results of operations of the applicable
         Person and/or the Property for the period(s) covered thereby, and do
         not omit to state any material information without which the same might
         reasonably be misleading. In addition, where this Agreement requires a
         "Compliance Certificate", if either Mezzanine Borrower or Guarantor are
         required to submit the same shall deliver a certificate duly executed
         on behalf of such Person by its chief executive officer or chief
         financial officer, in form and substance satisfactory to Mezzanine
         Lender, stating that there does not exist any Default or Event of
         Default under the Mezzanine Loan Documents (or if any exists,
         specifying the same in detail and the action taken or proposed to be
         taken with respect thereto).

                      (9) FISCAL YEAR. Mezzanine Borrower and Guarantor each
         represents that its fiscal year ends on December 31, and agrees that it
         shall not change its fiscal year.

                      (10) ACCOUNTANTS' REPORTS. Promptly upon receipt thereof,
         each of Mezzanine Borrower and Guarantor will deliver copies of all
         material reports submitted by independent public accountants in
         connection with each annual, interim or special audit of the Financial
         Statements or other business operations of Mezzanine Borrower and
         Guarantor made by such accountants, including the comment letter
         submitted by such accountants to management in connection with the
         annual audit.

                      (11) ANNUAL OPERATING, FF&E BUDGETS AND CAPITAL
         IMPROVEMENTS PLAN. At least forty-five (45) days prior to the
         expiration of each calendar year (commencing with the calendar year
         ended December 31, 2001), Mezzanine Borrower shall deliver to Mezzanine
         Lender for its review a proposed operating budget, a proposed FF&E
         budget, a proposed Capital Improvements Plan (in each case presented on
         a monthly and annual basis) for the Property for the next calendar year
         and, if otherwise prepared by Mezzanine Borrower, a proposed Three Year
         Business Plan (which, if



                                       51
<PAGE>   55

         provided, shall be for informational purposes only). Each
         proposed operating budget, FF&E budget and, so long as any funds remain
         in the Capital Improvement Reserve or Required Capital Improvements (as
         such terms are defined in the First Mortgage Loan Agreement) remain to
         be performed, each Capital Improvements Plan shall be subject to
         Mezzanine Lender's approval which shall not be unreasonably withheld,
         conditioned or delayed. Upon completion of the Required Capital
         Improvements and disbursement of all funds in the Capital Improvement
         Reserve, Mezzanine Borrower shall be required to thereafter deliver
         Capital Improvements Plans to Mezzanine Lender for informational
         purposes only, but same shall not be subject to Lender's approval;
         provided, however, that the foregoing shall not affect Mezzanine
         Borrower's obligation to obtain Mezzanine Lender's consent to any
         alteration if so required under the terms of this Agreement. The
         proposed operating budget shall identify and set forth Mezzanine
         Borrower's best estimate, after due consideration, of all revenue,
         costs, and expenses, and shall specify operating revenues and operating
         expenses on a line-item basis consistent with the form of operating
         budget delivered to Mezzanine Lender prior to Closing. If any of said
         budgets or plans requiring Lender's approval is not in form and
         substance reasonably satisfactory to Mezzanine Lender, Mezzanine Lender
         may disapprove the same and specify the reasons therefor in writing,
         and Mezzanine Borrower shall promptly amend and resubmit for approval
         revised budgets or plans, as applicable, making such changes as are
         necessary to comply with the reasonable requirements of Mezzanine
         Lender. If any such budget or plan requiring Mezzanine Lender's
         approval is not approved by the beginning of the calendar year covered
         thereby, the applicable budget or plan for the previous year shall
         remain in effect until the new budget or plan is approved. Mezzanine
         Lender shall approve or disapprove any proposed budget or plan
         requiring Mezzanine Lender's approval within fifteen (15) days after
         submission thereof by Mezzanine Borrower to Mezzanine Lender together
         with any information reasonably requested by Mezzanine Lender in
         writing in order to review same.

                      (12) If as of the beginning of any calendar year any
         operating or capital budget for such year has not been agreed to as
         provided above, Mezzanine Borrower shall, subject to the requirements
         of the First Mortgage Loan Documents, cause the First Mortgage Loan
         Borrower to operate the Property in accordance with the Approved
         Operating Budget applicable during the immediately preceding year,
         except (x) to the extent Mezzanine Lender has approved particular
         Expenses in the proposed operating or capital budget, Mezzanine
         Borrower shall have the right to incur and pay such approved Expenses,
         (y) Mezzanine Borrower shall have the right to incur and pay all other
         budgeted Expenses from the prior year's Approved Operating Budget,
         including, without limitation, all regular and customary recurring
         Expenses that are necessary or appropriate for the continued operation
         of the Property in accordance with historical operations, such as
         maintenance costs, tenant allowances, brokerage commissions, utility
         charges, fuel charges, and Impositions when due, subject to Mezzanine
         Lender's right to reject such nondiscretionary Expenses (other than
         Impositions and Insurance premiums) which exceed by more than three
         percent (3%) the amount of such Expense in the Approved Operating
         Budget applicable during the immediately preceding year and (z)
         Mezzanine Borrower shall have the right to incur and pay all other
         budgeted capital expenditures from the prior year's Approved FF&E
         Budget, including, without limitation, all regular and customary
         recurring capital expenditures that are necessary or appropriate for
         the



                                       52
<PAGE>   56

         continued operation of the Property in accordance with historical
         operations, subject to Mezzanine Lender's right to reject such
         nondiscretionary capital expenditures which exceed by more than three
         percent (3%) the amount of such capital expenditures in the Approved
         FF&E Budget applicable during the immediately preceding year; provided,
         however, if no Cash Sweep Event exists, Mezzanine Borrower shall have
         the right to use Excess Cash Flow to pay Expenses without Mezzanine
         Lender's prior consent. The Approved Operating Budget for the balance
         of calendar year 2001 and the Approved FF&E Budget for the balance of
         calendar year 2001 are attached hereto as Exhibit C and made a part
         hereof;

                      (13) contemporaneously with delivery to First Mortgage
         Lender, copies of all financial reporting documents required to be
         delivered by First Mortgage Loan Borrower under the terms of the First
         Mortgage Loan Documents to the extent not otherwise provided herein;

                      (14) contemporaneously with delivery to the members and
         partners of First Mortgage Loan Borrower and Mezzanine Borrower, but in
         no event later than thirty (30) days of it being filed without penalty,
         the annual consolidated federal income tax return of First Mortgage
         Loan Borrower and Mezzanine Borrower, with footnotes or other notation
         clearly denoting the separate assets and liabilities of First Mortgage
         Loan Borrower and Mezzanine Borrower; and

                      (15) promptly and in any event not later than one (1)
         Business Day after receipt thereof, Mezzanine Borrower shall forward to
         Mezzanine Lender (and Servicer) a copy of each monthly statement of
         payments due under the First Mortgage on the next First Mortgage Loan
         Payment Date to occur.

                  (k) ERISA. Mezzanine Borrower shall deliver to Mezzanine
Lender as soon as possible, and in any event within ten (10) days after
Mezzanine Borrower knows or has reason to believe that any of the events or
conditions specified below with respect to any Plan or Multiemployer Plan has
occurred or exists, a statement signed by a senior executive officer of
Mezzanine Borrower setting forth details respecting such event or condition and
the action, if any, that Mezzanine Borrower or its ERISA Affiliate proposes to
take with respect thereto (and a copy of any report or notice required to be
filed with or given to PBGC by Mezzanine Borrower or an ERISA Affiliate with
respect to such event or condition):

                      (1) any reportable event, as defined in Section 4043(b) of
         ERISA and the regulations issued thereunder, with respect to a Plan, as
         to which PBGC has not by regulation waived the requirement of Section
         4043(a) of ERISA that it be notified within 30 days of the occurrence
         of such event (provided that a failure to meet the minimum funding
         standard of Section 412 of the Code or Section 302 of ERISA, including,
         without limitation, the failure to make on or before its due date a
         required installment under Section 412(m) of the Code or Section 302(e)
         of ERISA, shall be a reportable event regardless of the issuance of any
         waivers in accordance with Section 412(d) of the Code); and any request
         for a waiver under Section 412(d) of the Code for any Plan;



                                       53
<PAGE>   57

                      (2) the distribution under Section 4041 of ERISA of a
         notice of intent to terminate any Plan or any action taken by Mezzanine
         Borrower or an ERISA Affiliate to terminate any Plan;

                      (3) the institution by PBGC of proceedings under Section
         4042 of ERISA for the termination of, or the appointment of a trustee
         to administer, any Plan, or the receipt by Mezzanine Borrower or any
         ERISA Affiliate of a notice from a Multiemployer Plan that such action
         has been taken by PBGC with respect to such Multiemployer Plan;

                      (4) the complete or partial withdrawal from a
         Multiemployer Plan by Mezzanine Borrower or any ERISA Affiliate that
         results in liability under Section 4201 or 4204 of ERISA (including the
         obligation to satisfy secondary liability as a result of a purchaser
         default) or the receipt by Mezzanine Borrower or any ERISA Affiliate of
         notice from a Multiemployer Plan that it is in reorganization or
         insolvency pursuant to Section 4241 or 4245 of ERISA or that it intends
         to terminate or has terminated under Section 4041A of ERISA;

                      (5) the institution of a proceeding by a fiduciary of any
         Multiemployer Plan against Mezzanine Borrower or any ERISA Affiliate to
         enforce Section 515 of ERISA, which proceeding is not dismissed within
         thirty (30) days;

                      (6) the adoption of an amendment to any Plan that,
         pursuant to Section 401(a)(29) of the Code or Section 307 of ERISA,
         would result in the loss of tax-exempt status of the trust of which
         such Plan is a part if Mezzanine Borrower or an ERISA Affiliate fails
         to timely provide security to the Plan in accordance with the
         provisions of said Sections; and

                      (7) the imposition of a lien or a security interest under
         Section 412(n) or Section 302(f)(1)(A) of ERISA in connection with a
         Plan.

                  (l) Entity Status. Mezzanine Borrower will and will cause
First Mortgage Loan Borrower, to (i) continue to comply in all material respects
with the provisions of all of their respective organizational documents, and the
laws of the state in which each such entity was formed relating to each such
Entity and (ii) enter into such amendments and modifications to such
organizational documents with respect to the rights and obligations of the
Mezzanine Borrower as may reasonably be required by Mezzanine Lender or any
Rating Agency to facilitate a Securitization or other transaction as described
in Section 8.34 hereof provided such amendments or modifications do not violate
the provisions of the First Mortgage Loan Documents. All customary formalities
regarding the Entity existence of Mezzanine Borrower and First Mortgage Loan
Borrower will continue to be observed.

                  (m) Impositions and Other Claims. Mezzanine Borrower shall or
shall cause First Mortgage Loan Borrower to pay and discharge or cause to be
paid and discharged all Impositions, as well as all lawful claims for labor,
materials and supplies or otherwise, which could become a Lien on the Property.

                  (n) Management of Property.



                                       54
<PAGE>   58

                      (i) The Property will be managed at all times by Manager
pursuant to a Management Agreement ("Management Agreement") in form and
substance reasonably satisfactory to Mezzanine Lender. The Manager will agree
that the Management Agreement and all fees payable thereunder are subject and
subordinate in all respects to the First Mortgage Loan and Mezzanine Loan.
Subject to the rights of First Mortgage Lender under the First Mortgage Loan
Documents, Mezzanine Borrower shall cause the Management Agreement to be
terminated at the Mezzanine Lender's request, upon thirty (30) days' prior
written notice to First Mortgage Loan Borrower and the Manager (w) upon the
occurrence and during the continuance of an Event of Default, (x) if the Manager
commits any act which would permit termination by First Mortgage Loan Borrower
under the Management Agreement unless cured within any grace period provided
therein, (y) there is directly or indirectly a transfer of more than 49% of the
ownership interest in the Manager or a change in control in the management and
operations of the Manager including a change of the President or CFO of the
hospitality group and the failure to replace them with persons of reasonably
comparable experience and expertise or (z) any Cash Sweep Event caused by a
Financial Covenants Breach of both financial covenants in Section 2.12(a)(ii)
and (iii) which are not remedied within the applicable ninety (90) day cure
period. If the Management Agreement is terminated pursuant hereto, Mezzanine
Borrower shall cause First Mortgage Loan Borrower immediately to seek to appoint
a replacement manager in accordance with the terms and conditions of the First
Mortgage Loan Documents acceptable to, and on terms and conditions acceptable
to, Mezzanine Lender in Mezzanine Lender's reasonable discretion, and First
Mortgage Loan Borrower's failure to obtain such an acceptable manager within
sixty (60) days after Mezzanine Lender's request to terminate the Management
Agreement shall constitute an immediate Event of Default.

                      (ii) Any successor manager selected hereunder by Mezzanine
Lender to serve as manager shall be a reputable management company having at
least seven (7) years' experience in the management of commercial properties
with a similar use to the Property.

                      (iii) Mezzanine Borrower shall cause First Mortgage Loan
Borrower to obtain and maintain in full force and effect during the Term a
liquor license which permits the operation of a restaurant, bar and other
service of alcoholic beverages at the Property.

                  (o) Liquidation Events. Mezzanine Borrower shall notify
Mezzanine Lender of the occurrence of any Liquidation Event not later than one
(1) Business Day following the first date on which Mezzanine Borrower has
knowledge of such Liquidation Event.

                  (p) Special Purpose Bankruptcy Remote Entity. Mezzanine
Borrower, the Control Entity of First Mortgage Loan Borrower, the Control Entity
of Mezzanine Borrower and First Mortgage Loan Borrower shall each continue to be
a Special Purpose Bankruptcy Remote Entity. A "Special Purpose Bankruptcy Remote
Entity" means a corporation, limited partnership or limited liability company
which at all pertinent times since its formation and, in any event, at all times
from and after the date hereof (i) was and is organized solely for the purpose
of (A) owning the Property, (B) acting as a Control Entity of the First Mortgage
Loan Borrower or Mezzanine Borrower, or (C) owning all of the limited
partnership or



                                       55
<PAGE>   59

non-managing membership interests in the First Mortgage Loan Borrower, (ii) has
not engaged and will not engage in any business unrelated to (A) the ownership
of the Property, (B) acting as Control Entity of the First Mortgage Loan
Borrower or Mezzanine Borrower, or (C) owning all of the limited partnership or
non-managing membership interests in the First Mortgage Borrower, (iii) has not
had and will not have any assets other than those related to the Property or its
direct or indirect ownership of the partnership or member interest in the
limited partnership or limited liability company that owns the Property, as
applicable, (iv) has not engaged, sought or consented to and will not engage in,
seek or consent to any dissolution, winding up, liquidation, consolidation,
merger, asset sale, transfer of partnership or membership interests (if such
entity is a Control Entity and if such transfer would otherwise affect its
status as a Special Purpose Bankruptcy Remote Entity), or amendment of its
limited partnership agreement, articles of incorporation, articles of
organization, certificate of formation or operating agreement as applicable (if
such amendment would affect its status as a Special Purpose Bankruptcy Remote
Entity), (v) if such entity is a limited partnership, has, as its only general
partners, Special Purpose Bankruptcy Remote Entities, (vi) if such entity is a
corporation, has at least one Independent Director, and has not caused or
allowed and will not cause or allow the board of directors of such entity to
take any action requiring the unanimous affirmative vote of 100% of the members
of its board of directors, unless an Independent Director shall have
participated in such vote, (vii) if such entity is a limited liability company,
has at least one managing member or non-member manager that is a Special Purpose
Bankruptcy Remote Entity that is a corporation, (viii) if such entity is a
limited liability company, has articles of organization, a certificate of
formation and/or an operating agreement, as applicable, providing that (A) such
entity will dissolve only upon the bankruptcy of the member or upon the entry of
judicial dissolution pursuant to applicable law, (B) the vote of the Control
Entity is sufficient to continue the life of the limited liability company in
the event of such bankruptcy of the member, and (c) if the vote of the Control
Entity to continue the life of the limited liability company following the
bankruptcy of the member is not obtained, the limited liability company may not
liquidate the Property without the consent of the applicable Rating Agencies for
so long as the First Mortgage Loan is outstanding, (ix) without the unanimous
consent of all of its partners, directors, members and managers (including
Independent Directors), as applicable, shall not (A) file a bankruptcy or
insolvency petition or otherwise institute insolvency proceedings with respect
to itself or to any other entity in which it has a direct or indirect legal or
beneficial ownership interest, (B) dissolve, liquidate, consolidate, merge, or
sell all or substantially all of its assets or the assets of any other entity in
which it has a direct or indirect legal or beneficial ownership interest, (C)
engage in any other business activity, or amend its organizational documents,
(x) is and will remain solvent and is maintaining and will maintain adequate
capital for the normal obligations reasonably foreseeable in a business of its
size and character and in light of its contemplated business operations, (xi)
has not failed and will not fail to correct any known misunderstanding regarding
the separate identity of such entity, (xii) has maintained and will maintain its
accounts, books and records separate from any other Person and will file its own
tax returns as may be required under applicable law to the extent not part of a
consolidated return, (xiii) has maintained and will maintain its books, records,
resolutions and agreements as official records, (xiv) has not commingled and
will not commingle its funds or assets with those of any other Person, (xv) has
held and will hold its assets in its own name, (xvi) has conducted and will
conduct its business in its name, (xvii) has maintained and will maintain its
financial statements, accounting records and other entity documents separate
from any other Person, or will ensure that any consolidated statements will be
annotated to indicate that the assets and credit of such entity are not
available for the creditors of any entity with which its financial statements
are consolidated, (xviii) has paid and will pay its own liabilities, including
the salaries of its own employees, only out of its own funds and assets,



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(xix) has observed and will observe all partnership, corporate or limited
liability company formalities, as applicable, (xx) has maintained and will
maintain an arm's-length relationship with its Affiliates, (xxi) with regard to
Mezzanine Borrower, has no Indebtedness other than the Mezzanine Loan and
Permitted Indebtedness, and with respect to First Mortgage Loan Borrower, has no
indebtedness other than the First Mortgage Loan and Permitted Indebtedness
relating to the ownership and operation of the Property; (xxii) has not and will
not assume or guarantee or become obligated for the debts of any other Person or
hold out its credit as being available to satisfy the obligations of any other
Person except for the Mezzanine Loan and the First Mortgage Loan, as the case
may be, and the liabilities permitted pursuant to the Mezzanine Loan Documents
and the First Mortgage Loan Documents, (xxiii) has not and will not acquire
obligations or securities of its partners, members or shareholders, (xxiv) has
allocated and will allocate fairly and reasonably any overhead for shared office
space and uses separate stationery, invoices and checks, (xxv) except in
connection with the Mezzanine Loan and the First Mortgage Loan, as the case may
be, has not pledged and will not pledge its assets for the benefit of any other
Person, (xxvi) has held itself out and identified itself and will hold itself
out and identify itself as a separate and distinct entity under its own name and
not as a division or part of any other Person, (xxvii) has maintained and will
maintain its assets in such a manner that it will not be costly or difficult to
segregate, ascertain or identify its individual assets from those of any other
Person, (xxviii) has not made and will not make loans to any Person, (xxix) has
not identified and will not identify its partners, members or shareholders, or
any Affiliate of any of them, as a division or part of it, (xxx) has not entered
into or been a party to, and will not enter into or be a party to, any
transaction with its partners, members, shareholders or Affiliates except in the
ordinary course of its business and on terms which are intrinsically fair and
are no less favorable to it than would be obtained in a comparable arm's-length
transaction with an unrelated third party, (xxxi) has no obligation to indemnify
its partners, officers, directors or members, as the case may be, or has such an
obligation that is fully subordinated to the Debt and will not constitute a
claim against it in the event that cash flow in excess of the amount required to
pay the Debt is insufficient to pay such obligation, and (xxxii) will consider
the interests of its creditors in connection with all corporate, partnership or
limited liability company actions, as applicable.

                  (q) Assumptions in Non-Consolidation Opinion. Mezzanine
Borrower, the Control Entity of Mezzanine Borrower and First Mortgage Loan
Borrower shall conduct their business so that the assumptions made in that
certain substantive nonconsolidation opinion letter dated the date hereof,
delivered by Mezzanine Borrower's counsel in connection with the Mezzanine Loan,
shall be true and correct in all material respects.

                  (r) Expenses. Mezzanine Borrower shall reimburse Mezzanine
Lender upon receipt of notice for all reasonable costs and expenses (including
reasonable attorneys' fees and disbursements) incurred by Mezzanine Lender in
connection with (i) the preparation, negotiation, execution and delivery of the
Mezzanine Loan Documents and the consummation of the transactions contemplated
thereby and all reasonable costs of furnishing all opinions by counsel for
Mezzanine Borrower and its Affiliates; (ii) Mezzanine Borrower's, its
Affiliates' and Mezzanine Lender's ongoing performance under and compliance with
the Mezzanine Loan Documents, including confirming compliance with environmental
and insurance requirements; (iii) the negotiation, preparation, execution,
delivery and administration of any consents, amendments, waivers or other
modifications of or under any Mezzanine Loan Document and any



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other documents or matters requested by Mezzanine Lender; (iv) filing and
recording of any Mezzanine Loan Documents; (v) engineering reports,
environmental reports, surveys, inspections and appraisals as expressly required
in this Agreement; (vi) enforcing or preserving any rights, in response to third
party claims or the prosecuting or defending of any action or proceeding or
other litigation, in each case against, under or affecting Mezzanine Borrower,
First Mortgage Loan Borrower, the Mezzanine Loan Documents, the Collateral, the
Property, or any other security given for the Mezzanine Loan; and (vii)
enforcing any obligations of or collecting any payments due from Mezzanine
Borrower or First Mortgage Loan Borrower under any Mezzanine Loan Document or
with respect to the Collateral, the Property or in connection with any
refinancing or restructuring of the Mezzanine Loan in the nature of a
"work-out", or any insolvency or bankruptcy proceedings; provided, however, that
Mezzanine Borrower shall not be liable for the payment of any such costs and
expenses to the extent the same arise by reason of the gross negligence, illegal
acts, fraud or willful misconduct of Mezzanine Lender. The obligations and
liabilities of Mezzanine Borrower under this Section shall survive the Maturity
Date and the exercise by Mezzanine Lender of any of its rights or remedies under
the Mezzanine Loan Documents.

                  (s) Interest Rate Protection. On the date hereof, Mezzanine
Borrower shall have, at its sole cost and expense, entered into an interest rate
protection agreement with a counterparty acceptable to Mezzanine Lender in its
sole discretion and on terms reasonably satisfactory to Mezzanine Lender
("Interest Rate Cap Agreement"), providing Mezzanine Borrower with an initial
cap on LIBOR at a maximum of 7.50% and a maximum of 8.25% during any extension
period or for any replacement and Mezzanine Borrower shall pay all fees and
costs associated with such agreement. In addition, to the extent and upon the
terms required under the First Mortgage Loan Documents, Mezzanine Borrower shall
obtain a "Cap Guaranty" (as such term is defined in Section 2.3 of the First
Mortgage Loan Agreement) in connection with the Interest Rate Cap Agreement. All
of the benefits of such Interest Rate Cap Agreement (including the Cap Guaranty)
shall be collaterally assigned to Mezzanine Lender as additional Collateral for
the Mezzanine Loan.

                  Section 5.2. Leases. Except as otherwise expressly permitted
in the First Mortgage Loan Documents or this Section 5.2, Mezzanine Borrower
covenants and agrees that, from the date hereof and until payment in full of the
Debt:

                  (a) Except as permitted in this Section 5.2, Mezzanine
Borrower shall not and shall not permit Manager or First Mortgage Loan Borrower
to enter into, modify, amend, consent to the cancellation or surrender of
(except by the Tenant under a Lease pursuant to a pre-existing right) or
terminate any Material Lease, whether now existing or hereafter entered into,
without the prior written consent of Mezzanine Lender, which shall be promptly
granted or withheld in Mezzanine Lender's commercially reasonable discretion
(and shall be deemed to have been granted if not withheld within five (5)
Business Days after Mezzanine Lender's receipt of a written request therefor,
provided that such approval shall under no circumstances be deemed granted, if
and to the extent (i) the Tenant under such Lease is an Affiliate of Mezzanine
Borrower or (ii) such Lease has not been entered into on an arm's-length basis).

                  (b) Except for De minimis Leases, Mezzanine Borrower will
cause First Mortgage Loan Borrower to timely comply with or cause to be timely
complied with all material



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<PAGE>   62

terms and conditions on the landlord's part to be performed under each Lease.
Mezzanine Borrower shall cause First Mortgage Loan Borrower neither to do nor to
neglect to do, nor to permit to be done, anything which may cause the
termination of any Material Lease, other than due to the default of the
Tenant(s) under such Material Lease or such Tenant's exercise of any termination
rights which it holds under such Material Lease without the express prior
written consent of Mezzanine Lender which shall not be unreasonably withheld or
delayed. Except for security deposits and except with respect to De minimis
Leases, Mezzanine Borrower shall not and shall not permit First Mortgage Loan
Borrower to collect any rent or other payment under any Lease more than one (1)
month in advance of the due date thereof and will use all commercially
reasonable efforts to require the performance of all of the obligations of
Tenants and other Persons bound by the Leases and to enforce the Leases except
as herein otherwise expressly provided and shall require that all future
Material Leases are subordinate to the First Mortgage Loan Documents either
pursuant to its terms or pursuant to a subordination and attornment agreement.

                  (c) Provided that there shall not have occurred and be
continuing a Default or Event of Default, Mezzanine Borrower may, without
Mezzanine Lender's prior written consent, cause First Mortgage Loan Borrower to
enter into and amend or modify or permit the entering into, amendment or
modification of any (A) De minimis Lease, or (B) any Lease which is not a
Material Lease, provided that with respect to any Lease other than a De minimis
Lease (i) the net effective rent (after taking into account any free rent,
construction allowances or other concessions granted by landlord) is no less
than 90% of the then effective fair market rent then prevailing for similar
properties and leases in the market area; (ii) such Lease, amendment or
modification is otherwise on commercially reasonable terms; (iii) such Lease,
amendment or modification does not contain any options to purchase or other
rights with respect to the ownership of the Property; (iv) such Lease, amendment
or modification does not contain any restrictions on landlord's rights to lease
remaining portions of the Property, except that such Lease, amendment or
modification may contain customary "exclusives" and other customary use
restrictions and options to lease additional space in the Property; (v) such
Lease, amendment or modification does not contain any options for the Tenant
thereunder to terminate such Lease, other than in the event of a material
casualty or condemnation; (vi) such Lease, amendment or modification is entered
into on an arm's-length basis; (vii) such Lease, amendment or modification shall
contain provisions substantially similar to each of the provisions set forth in
Section 5.2(d) hereof; (viii) such amendment or modification does not release
any Person from its obligations under the Lease so amended or modified or reduce
the square footage demised thereunder; and (ix) such amendment or modification
does not materially reduce the rent payable under the Lease so amended and
modified. Mezzanine Borrower may, without the prior written consent of Mezzanine
Lender, cause First Mortgage Loan Borrower to terminate any Lease which is not a
Material Lease either in its good faith exercise of its remedies under such
Lease, or at law or in equity, by reason of a monetary or another material
default beyond any applicable notice and cure periods thereunder.

                  (d) Each Material Lease executed by Mezzanine Borrower or
First Mortgage Loan Borrower after the Closing Date shall provide, in a manner
reasonably satisfactory to Mezzanine Lender, for (i) the Tenant thereunder to
give a notice to Mezzanine Lender of each material default by the landlord or
licensor thereunder, simultaneously with the giving of notice of such default to
such landlord or licensor, and (ii) execution and delivery (not more than (10)



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days after a request therefor) of an estoppel certificate in form reasonably
requested by Mezzanine Borrower, and Mezzanine Borrower hereby agrees, not later
than ten (10) Business Days after receipt of Mezzanine Lender's written request
therefor, to request Tenant estoppel certificates from Tenants in a form
reasonably proposed by Mezzanine Lender.

                  (e) After the occurrence of an Event of Default, but subject
to the rights of the First Mortgage Lender under the First Mortgage Loan
Documents, security and other refundable deposits of Tenants, whether held in
cash or any other form, shall be turned over to Mezzanine Lender (together with
any undisbursed interest earned thereon) upon Mezzanine Lender's request
therefor to be held by Mezzanine Lender subject to the terms of the Leases. Any
letter of credit or other instrument which Mezzanine Borrower or First Mortgage
Loan Borrower holds in lieu of cash security deposit shall be maintained in full
force and effect in the full amount of such deposits unless replaced by cash
deposits as herein-above described and shall in all respects comply with any
applicable Legal Requirements and otherwise be satisfactory to Mezzanine Lender.
Mezzanine Borrower shall, upon request, provide Mezzanine Lender with evidence
reasonably satisfactory to Mezzanine Lender of Mezzanine Borrower's and First
Mortgage Loan Borrower's compliance with the foregoing.

                  (f) Each of the Convention Contracts (as such term is defined
in the First Mortgage Loan Agreement) in effect on the date hereof is
substantially in the form of the standard form of Convention Contract previously
delivered to and approved by Mezzanine Lender (with reasonable changes thereto
as necessary to reflect the terms of such contract) and is otherwise on
Borrower's customary terms.

                  Section 5.3. Insurance; Coverages. Mezzanine Borrower will
maintain or cause to be maintained, with financially sound and reputable
insurers, public liability, property damage, business interruption and other
types of insurance with respect to its business, the business of First Mortgage
Loan Borrower and the Property (including all Improvements now existing or
hereafter erected thereon) in such amounts and for such periods and against all
losses, hazards, casualties, liabilities and contingencies as customarily
carried or maintained by Persons of established reputation engaged in similar
businesses. Without limitation of the foregoing, Mezzanine Borrower shall
maintain or cause to be maintained policies of insurance (collectively,
"Insurance") with respect to the Property in the following amounts and covering
the following risks:

                  5.3.1 Property damage insurance covering loss or damage to the
Property caused by fire, lightning, hail, windstorm, explosion, hurricane (to
the extent available), vandalism, malicious mischief, and such other losses,
hazards, casualties, liabilities and contingencies as are normally and usually
covered by fire policies in effect where the Property is located endorsed to
include all of the extended coverage perils and other broad form perils,
including the standard "all risks" clauses, with such endorsements as Mezzanine
Lender may from time to time reasonably require including, without limitation,
building ordinance and law (including demolition costs and increased cost of
construction coverage), lightning, windstorm, civil commotion, hail, riot,
strike, water damage, sprinkler leakage, collapse and malicious mischief. Such
policy shall be in an amount not less than that necessary to comply with any
coinsurance percentage stipulated in the policy, but not less than 100% of the
full replacement cost of all Improvements (without any deduction for
depreciation), and shall contain replacement



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cost and agreed amount endorsements each in an amount not less than the
outstanding principal amount of the Mezzanine Loan. The deductible under such
policy shall not exceed $100,000.

                  5.3.2 Broad form boiler and machinery insurance in an amount
equal to the full replacement cost of the Improvements (without any deduction
for depreciation) in which the boiler or similar vessel is located, and
including coverage against loss or damage from (1) leakage or sprinkler systems
and (2) damage, breakdown or explosion of steam boilers, electrical machinery
and equipment, air conditioning, refrigeration, pressure vessels or similar
apparatus and mechanical objects now or hereafter installed at the Property.

                  5.3.3 If the Property is in an area prone to geological
phenomena, including, but not limited to, sinkholes, mine subsidence or
earthquakes, insurance covering such risks in an amount equal to $100,000,000
(without any deduction for depreciation), and with a maximum permissible
deductible of $100,000.

                  5.3.4 Flood insurance if the Property is in an area now or
hereafter designated by the Federal Emergency Management Agency as a Zone "A" &
"V" Special Hazard Area, or such other Special Hazard Area if Mezzanine Lender
so requires in its sole discretion. Such policy shall be in an amount equal to
$50,000,000 (without any deduction for depreciation), and shall have a maximum
permissible deductible of $100,000.

                  5.3.5 Business interruption or rent loss insurance in an
amount equal to the anticipated gross income or rentals from the Property
(assuming an occupancy rate of 100%) for an indemnity period commencing on the
date of the casualty and ending at least ninety (90) days after completion of
the restoration, (but with no maximum limit on the overall length of such
indemnity period) such amount being adjusted annually. Mezzanine Lender shall be
named as loss payee under such insurance.

                  5.3.6 During any period of reconstruction, renovation or
alteration of the Property in excess of 10% of the outstanding principal balance
of the Mezzanine Loan, a completed value, "All Risks" Builders Risk form or
"Course of Construction" insurance policy in non-reporting form and in an amount
not less than the lesser of 100% of the full replacement cost of all
Improvements and the then outstanding principal balance of the Mezzanine Loan.

                  5.3.7 Commercial general liability insurance against claims
for personal and bodily injury (including death resulting therefrom) to one or
more persons or property damage, occurring on, in or about the Property
(including the adjoining streets, sidewalks and passageways) in such amounts as
Mezzanine Lender may from time to time reasonably require, but not less than
$25,000,000 for each occurrence and $50,000,000 in the aggregate. This policy or
policies must include coverage for premises and operations liability, products
and completed operations liability, contractual liability, hired, owned and
non-owned automobile liability, innkeepers legal liability and "Dram shop" or
other liquor liability if alcoholic beverages are sold from or may be consumed
at the Property.

                  5.3.8 If required by applicable state laws, worker's
compensation or employer's liability insurance in accordance with such laws.



                                       61
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                  5.3.9 Mezzanine Borrower and Manager shall maintain fidelity
insurance and professional liability insurance in amounts reasonably
satisfactory to Mezzanine Lender in its sole discretion in event against losses
resulting from dishonest or fraudulent acts committed by Mezzanine Borrower's
and Manager's personnel, employees and agents.

                  5.3.10 Such other insurance and endorsements, if any, as
Mezzanine Lender may reasonably require from time to time, and which is then
customarily required by institutional lenders for similar properties similarly
situated, against other insurable hazards, including, but not limited to,
malicious mischief, vandalism or windstorm, which at the time are commonly
insured against and generally available in the case of properties similarly
situated, due regard to be given to the size and type of the Property.

                  5.3.11 Each carrier providing any insurance, or portion
thereof, required by this Section 5.3 shall be licensed to do business in the
jurisdiction or jurisdictions in which the Property is located, and shall have a
claims paying ability rating and/or financial strength rating, as applicable, by
S&P of not less than "AA", by Moody's of not less than "Aa2" and by Fitch of not
less than "AA" and an A.M. Best Company, Inc. rating of not less than A and
financial size category of not less than XIII. Mezzanine Borrower shall cause
all insurance (except general public liability and worker's compensation
insurance) carried in accordance with this Section 5.3 to be payable to "Merrill
Lynch Mortgage Capital Inc., a Delaware corporation, its successors, assigns and
participants, as their respective interests may appear, as secured party" and
not as a coinsured.

                  5.3.12 All insurance policies and renewals thereof (i) shall
be in a form reasonably acceptable to Mezzanine Lender, (ii) shall provide for a
term of not less than one year, (iii) shall provide by way of endorsement, rider
or otherwise that such insurance policy shall not be canceled, endorsed,
altered, or reissued to effect a change in coverage unless such insurer shall
have first given Mezzanine Lender thirty (30) days prior written notice thereof,
(iv) shall include a standard mortgagee clause in favor of and in form
acceptable to Mezzanine Lender, (v) shall provide for claims to be made on an
occurrence basis, except that boiler and machinery coverage may be made on an
accident basis, and (vi) shall contain an agreed value clause updated annually
(if the amount of coverage under such policy is based upon the replacement cost
of the Property). All property damage insurance policies (except for flood and
earthquake policies) must automatically reinstate after each loss.

                  5.3.13 At least ten (10) Business Days prior to the end of
each insurance policy period of Mezzanine Borrower (or such shorter period as
provided in the First Mortgage Loan Agreement), Mezzanine Borrower will deliver
certificates, reports, and/or other information (all in form and substance
satisfactory to Mezzanine Lender), (i) outlining all material insurance coverage
maintained as of the date thereof by Mezzanine Borrower and all material
insurance coverage planned to be maintained by Mezzanine Borrower in the
subsequent insurance policy period and (ii) evidencing payment in full of the
premiums for such insurance policies. If at any time Mezzanine Lender is not in
receipt of written evidence that all Insurance required hereunder is in force
and effect, Mezzanine Lender shall have the right to take such action as
Mezzanine Lender deems necessary to protect its interest, including, without
limitation, the obtaining of such insurance coverage as Mezzanine Lender in its
sole discretion deems appropriate, and all expenses incurred by Mezzanine Lender
in connection with such action or in obtaining such



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<PAGE>   66

insurance and keeping it in effect shall be paid by Mezzanine Borrower to
Mezzanine Lender upon demand. Mezzanine Lender shall in no event be obligated,
however, to obtain such insurance coverage for the benefit of Mezzanine
Borrower.

                  5.3.14 Waiver of Subrogation. The Insurance, as applicable,
and all renewals thereof shall contain, in form and substance reasonably
acceptable to Mezzanine Lender, a standard "Waiver of Subrogation" endorsement,
and an endorsement providing in general that any claim or defense the insurance
company may have against Mezzanine Borrower or First Mortgage Loan Borrower to
deny payment of any claim by Mezzanine Borrower or First Mortgage Loan Borrower
thereunder shall not be effective against Mezzanine Lender (and affirmatively
providing that the insurance company will pay the proceeds of such Insurance to
Mezzanine Lender notwithstanding any claim or defense of the insurance company
against Mezzanine Lender).

                  5.3.15 No Separate Insurance. Neither Mezzanine Borrower nor
First Mortgage Loan Borrower will take out separate insurance concurrent in form
or contributing in the event of loss with that required to be maintained
pursuant to this Section 5.3.

                  5.3.16 Casualty; Proceeds of Required Insurance. Mezzanine
Borrower shall give Mezzanine Lender prompt notice of any loss or damage to the
Property and, subject to the rights of the First Mortgage Lender under the First
Mortgage Loan Documents:

                      (a) In the case of any loss or damage covered by any
Insurance, Mezzanine Lender is hereby authorized (i) if an Event of Default
shall have occurred and is continuing or, if no Event of Default shall have
occurred but Mezzanine Borrower or First Mortgage Loan Borrower fails to settle
and adjust any claim within ninety (90) Business Days after such casualty has
occurred, to settle and adjust any claim under such Insurance without the
consent of Mezzanine Borrower or First Mortgage Loan Borrower, or (ii) if no
Event of Default has occurred, to allow Mezzanine Borrower or First Mortgage
Loan Borrower within ninety (90) Business Days (or such longer period as
necessary as long as Mezzanine Borrower is diligently and in good faith pursuing
the settlement of such claim and, in Mezzanine Lender's reasonable discretion,
such additional period will not result in a Material Adverse Condition) after
such casualty to settle and adjust such claim; provided, however, if any
settlement may reasonably be anticipated to result in proceeds in excess of
$1,000,000, the consent of Mezzanine Lender, not to be unreasonably withheld or
delayed shall be required; provided, further, that in either case following the
foregoing periods Mezzanine Lender shall, and is hereby authorized to, collect
and receive any such insurance proceeds, subject, however, to the rights of
First Mortgage Lender under the First Mortgage Loan Documents. The reasonable
expenses incurred by Mezzanine Lender in the adjustment and collection of such
proceeds of Insurance shall be additional Debt of Mezzanine Borrower, and shall
be reimbursed to Mezzanine Lender upon written demand or, at Mezzanine Lender's
option, in the event and to the extent sufficient proceeds are available,
deducted by Mezzanine Lender from such proceeds of Insurance prior to any other
application thereof. Subject to the rights of the First Mortgage Lender, each
insurance company which has issued Insurance is hereby authorized and directed
to pay any amounts payable to Mezzanine Lender by virtue of its interest in the
Insurance under the insurance policies to Mezzanine Lender alone, and shall not
require an endorsement by Mezzanine Borrower. Mezzanine Borrower agrees to
execute and cause First Mortgage Loan Borrower to execute all documents and make



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all deliveries required in order to permit adjustment and payment of insurance
proceeds as provided above.

                      (b) Mezzanine Lender shall, in its sole discretion (except
as provided below), apply the proceeds of Insurance consequent upon any casualty
either (i) to reduce the Debt, in such order or manner as Mezzanine Lender may
elect; or (ii) at Mezzanine Lender's election, to reimburse Mezzanine Borrower
or First Mortgage Loan Borrower for or to pay the costs of restoring, repairing,
replacing or rebuilding (collectively, a "Restoration") the loss or damage
caused by such casualty, in accordance with and subject to the conditions
contained in the provisions of subdivision (f) hereof. Notwithstanding the
foregoing, subject to the satisfaction of the conditions described in Section
5.3.16(f), Mezzanine Lender agrees to permit the proceeds of Insurance to be
applied toward the cost of Restoration if (i) First Mortgage Lender is
permitting such proceeds to be so applied toward Restoration in accordance with
the First Mortgage Loan Documents, and (ii) the requirements of subdivision (f)
below are otherwise satisfied. Any application of proceeds of Insurance pursuant
to this Section 5.3.16(b) to pay the Principal Indebtedness shall not require
the payment of the Prepayment Fee, if applicable.

                      (c) Whether or not proceeds of Insurance are made
available to Mezzanine Borrower or First Mortgage Loan Borrower or such proceeds
are sufficient for such purposes, Mezzanine Borrower hereby covenants to, or to
cause First Mortgage Loan Borrower to, promptly after such casualty and at
Mezzanine Borrower's or First Mortgage Loan Borrower's sole cost and expense,
commence and thereafter diligently proceed to Restore the Improvements, to be of
at least equal value and of substantially the same character as prior to such
loss or damage, if allowed by law, in accordance with all Legal Requirements and
plans, specifications and procedures to be first submitted to and approved by
Mezzanine Lender, and Mezzanine Borrower or First Mortgage Loan Borrower shall
pay all costs of such Restoration.

                      (d) Any portion of the proceeds of Insurance remaining
after payment in full of the Debt shall be paid to Mezzanine Borrower or First
Mortgage Loan Borrower or as ordered by a court of competent jurisdiction.

                      (e) Except as otherwise required by First Mortgage Loan
Documents, if the proceeds of the Insurance exceed $1,000,000, all proceeds of
the Insurance described in Section 5.3.5 above shall be paid to the Deposit
Account and shall be disbursed by Mezzanine Lender in accordance with the
following: (i) if paid in monthly installments and provided that no Event of
Default has occurred and is continuing, in accordance with the terms of the
Mezzanine Deposit Account Agreement as if such proceeds were Receipts, (ii) if
paid in a lump sum, and provided that no Event of Default has occurred and is
continuing, into a segregated reserve account in the sole dominion and control
of Mezzanine Lender for application in monthly installments (equal to such lump
sum divided by the aggregate number of months on account of which paid) in the
manner described in subdivision (b) above. If the proceeds of the insurance are
less than or equal to $1,000,000, they will be paid to Mezzanine Borrower
directly to be applied to the cost of repairs and restoration.

                      (f) Provided that no Event of Default has occurred and is
then continuing and except as otherwise provided in the First Mortgage Loan
Documents, proceeds of Insurance that pursuant to the terms of Section
5.3.16(b)(ii) hereof or Section 5.3.16(g) or that



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the Mezzanine Lender otherwise agrees to apply to the Restoration of the
Property shall be disbursed from time to time (but not more often than monthly)
upon Mezzanine Lender being furnished with (i) evidence reasonably satisfactory
to Mezzanine Lender from an independent architect or other Person selected by
the Mezzanine Borrower (who, in any case, is reasonably approved by Mezzanine
Lender), of the estimated cost of completion of the Restoration, (ii) evidence
of funds or other assets sufficient in addition to the proceeds of Insurance, to
complete and fully pay for the completion of the Restoration, based on the cost
estimate referenced in clause (i) above, (iii) a request from Mezzanine
Borrower, dated not more than ten (10) Business Days prior to the proposed
application of such payment, requesting such payment or reimbursement and
setting forth the Restoration work which is in the subject of such request, the
parties which performed such work, and the actual cost thereof, and certifying
that such work and materials are free and clear of Liens (or will be so after
disbursement of the applicable proceeds), and (iv) such architect's
certificates, waivers of lien, contractor's sworn statements, title insurance
endorsements, plats of survey and such other evidences of cost, payment and
performance as Mezzanine Lender may reasonably require and approve. Mezzanine
Lender may, in all events, require that all plans and specifications for any
such Restoration be submitted to and approved by Mezzanine Lender (such approval
not to be unreasonably withheld) and that all Permits required for Restoration
be obtained prior to commencement of each portion of the Restoration work.
Except as provided below, any cash provided in accordance with clause (iii)
above shall be applied as if such cash were proceeds of Insurance. No payment
made prior to the final completion of the Restoration shall exceed ninety-five
percent (95%) of the value (or such other amount as Mezzanine Lender may approve
in Mezzanine Lender's sole discretion) of the Restoration work performed or
materials delivered, as applicable, from time to time, as such value shall be
determined by Mezzanine Lender in its reasonable judgment. Funds other than
proceeds of Insurance shall be disbursed prior to disbursement of such proceeds,
except as may otherwise be provided herein; and at all times the undisbursed
balance of such proceeds, together with cash furnished to Mezzanine Lender in
accordance with clause (iii) above to pay the cost of completion of the
Restoration, shall be at least sufficient in the reasonable judgment of
Mezzanine Lender to pay the entire unpaid cost of the completion of the
Restoration, free and clear of all Liens or claims for Lien. In addition to all
other conditions contained in this Section 5.3.16(f), final payment of all
proceeds of Insurance remaining with Mezzanine Lender shall be made upon receipt
by Mezzanine Lender of a certification by an independent architect or contractor
reasonably approved by Mezzanine Lender as to the completion of the Restoration
substantially in accordance with the submitted plans and specifications, and the
filing of a notice of completion (if such filing is required by applicable Legal
Requirements). Any surplus which may remain out of proceeds of Insurance (or
cash provided pursuant to clause (iii) above) held by Mezzanine Lender after
payment of such costs of Restoration shall be applied by Mezzanine Lender in
accordance with the terms of the First Mortgage Loan Documents or shall be
deposited into the Deposit Account and held or disbursed in accordance with the
terms of the Mezzanine Deposit Account Agreement. If there shall have occurred
an Event of Default while Mezzanine Lender is holding funds for Restoration
(including for these purposes any cash deposited pursuant to clause (ii) above),
Mezzanine Lender may at its sole option (but subject to the rights of First
Mortgage Lender) apply such funds against the Indebtedness in such order or
manner as Mezzanine Lender may elect. Mezzanine Borrower shall pay, from time to
time, within five (5) Business Days after demand therefor, the reasonable fees
and expenses of any consultant hired by Mezzanine Lender to review the progress
of the Restoration and inspect the work of



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Restoration, which consultant's approval shall be required for any disbursement
to be made. Mezzanine Lender shall not be obligated to see to the proper
application of funds disbursed to Mezzanine Borrower pursuant hereto, whether
pursuant to the above conditions or upon waiver thereof.

                      (g) Notwithstanding anything herein to the contrary, the
proceeds of insurance shall be used for Restoration of the Property if the
requirements set forth in Section 5.5(c) of the First Mortgage Loan Agreement
are satisfied.

                  5.3.17 Mezzanine Borrower may maintain a portion of the
commercial general liability insurance required under Section 5.3.7 above in an
amount not to exceed $1,000,000 per occurrence and a portion of the worker's
compensation insurance required under Section 5.3.8 in an amount not to exceed
$300,000 per occurrence by means of a self-insurance program, the terms and
conditions of which shall be acceptable to Mezzanine Lender. Mezzanine Borrower
shall at all times maintain cash reserves in the Self-Insurance Reserve Account
in accordance with the provisions of Section 6.7 of First Mortgage Loan
Agreement and the Cash Management Agreement (as such terms are defined in the
First Mortgage Loan Agreement). Promptly after Mezzanine Lender's written
request therefor, Mezzanine Borrower shall provide Mezzanine Lender with any and
all information reasonably requested by Mezzanine Lender with respect to such
self-insurance program including, without limitation, information regarding the
balance of and activity in the Self-Insurance Reserve Account, claims paid
during any period and pending and threatened claims. If the Self-Insurance
Reserve Account is not being maintained under the First Mortgage Loan Agreement,
Mezzanine Lender shall have the right to establish and Mezzanine Borrower shall
have the obligation to maintain, a self-insurance reserve account.

                  5.3.18 Notwithstanding anything herein to the contrary, in the
case of any conflict or inconsistency between the requirements for insurance
hereunder and under the First Mortgage Loan Documents, the provisions of the
First Mortgage Loan Documents shall control and compliance therewith shall be
deemed to be compliance with this Agreement.

                  Section 5.4. Condemnation and Eminent Domain.

                  Subject to the prior rights of First Mortgage Lender under the
First Mortgage Loan Documents, any and all awards, including any portion of such
awards paid to First Mortgage Loan Borrower on account of "interest" (the
"Awards") heretofore or hereafter made or to be made by any Governmental
Authority for the taking by condemnation or eminent domain, of all or any part
of the Property (including any award from the United States government at any
time after the allowance of a claim thereof), or the proceeds from a transfer in
lieu of such condemnation or eminent domain, are hereby assigned by Mezzanine
Borrower and First Mortgage Loan Borrower to Mezzanine Lender, which Awards
Mezzanine Lender is hereby authorized to collect and receive from the
condemnation authorities. Mezzanine Lender is hereby authorized to give
appropriate receipts and acquittances therefor, and Mezzanine Borrower and First
Mortgage Loan Borrower hereby irrevocably appoint Mezzanine Lender Mezzanine
Borrower's and First Mortgage Loan Borrower's attorney-in-fact, coupled with an
interest, to collect such Awards; provided that such power of attorney shall not
be exercised unless an Event of Default has occurred and is continuing at the
time in question. Mezzanine Borrower shall give Mezzanine Lender prompt notice
of the actual or threatened commencement



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of any condemnation of eminent domain proceeds affecting all or any part of the
Property and shall deliver to Mezzanine Lender copies of any and all papers
served in connection with any such proceedings. Mezzanine Borrower further
agrees to make, execute and deliver to Mezzanine Lender, at any time upon
request, any and all further assignments and other instruments deemed reasonably
necessary by Mezzanine Lender for the purpose of validly and sufficiently
assigning all Awards and other compensation heretofore and hereafter made to
Mezzanine Borrower or First Mortgage Loan Borrower upon any taking, either
permanent or temporary, under any such proceeding and all proceeds paid from a
sale in lieu of such taking, and to facilitate Mezzanine Lender's collection and
receipt of the same. If, notwithstanding the foregoing provisions, any Award or
other compensation described above is nonetheless paid to Mezzanine Borrower,
Mezzanine Borrower shall hold or cause first Mortgage Loan Borrower to hold such
monies in trust for the benefit of Mezzanine Lender or First Mortgage Loan
Borrower, and Mezzanine Borrower and First Mortgage Loan Borrower shall
immediately pay the same to Mezzanine Lender, unless otherwise required by First
Mortgage Lender. The expenses incurred by Mezzanine Lender in the collection and
administration of any Award, including reasonable attorneys' fees and
disbursements, shall be additional Debt, and shall be reimbursed to Mezzanine
Lender upon demand or, at Mezzanine Lender's option, in the event and to the
extent sufficient proceeds are available, shall be deducted by Mezzanine Lender
from said proceeds prior to any other application hereof. If the amount of the
Award is reasonably expected to exceed $1,000,000, Mezzanine Borrower may not
and shall not cause or suffer First Mortgage Loan Borrower to settle or
compromise any claim for or right to receive any Award or its rights under any
proceeding with respect thereto without the prior written consent of Mezzanine
Lender, which consent shall not be unreasonably withheld or delayed.
Notwithstanding any taking, Mezzanine Borrower shall continue to pay the
Mezzanine Loan with interest thereon at the time and in the manner provided for
in the Mezzanine Note and the other Mezzanine Loan Documents and the Debt shall
not be reduced by reason of such taking (or transfer in lieu thereof) unless and
until any Award shall have been actually received and applied by Mezzanine
Lender to such Debt and then only to such extent. Mezzanine Lender shall not be
limited to any interest paid on the Award by the condemning authority but shall
be entitled to receive out of the Award interest at the rates set forth herein
and in the Mezzanine Note. Any application of the proceeds of any such Award to
pay the Principal Indebtedness shall not require the payment of the Prepayment
Fee, if applicable, except as otherwise expressly provided in this Agreement to
the contrary. Notwithstanding anything herein to the contrary, Mezzanine Lender
agrees to permit the net Award to be applied toward Restoration if (a) First
Mortgage Lender is permitting such Award to be so applied to Restoration in
accordance with the First Mortgage Loan Documents and (b) no Event of Default
has occurred and is continuing and (c) the conditions set forth in Section
5.3.14(f) are satisfied.

                  Section 5.5. O&M Plan. Mezzanine Borrower has caused to be
prepared and delivered to Mezzanine Lender an operations and maintenance program
with respect to suspected asbestos and asbestos-containing materials (the "O&M
Plan") located in the Property as set forth in the Environmental Report.
Mezzanine Borrower shall at all times implement and carry out the O&M Plan in
accordance with its terms. Mezzanine Lender's requirement that Borrower develop
and comply with the O&M Plan shall not be deemed to constitute a waiver or
modification of any covenants or agreements of Mezzanine Borrower or Guarantor
with respect to Hazardous Substances or Environmental Laws as set forth herein
or in the Environmental Indemnity.



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                                   ARTICLE VI

                               NEGATIVE COVENANTS

                  Section 6.1. Mezzanine Borrower Negative Covenants. Mezzanine
Borrower covenants and agrees that, until payment in full of the Debt, it will
not do, directly or indirectly, nor will Mezzanine Borrower permit First
Mortgage Loan Borrower to do, directly or indirectly, any of the following
unless Mezzanine Lender consents thereto in writing:

                  (a) Special Purpose Existence and Separateness of Entities.
(x): (i) take any actions in violation of Mezzanine Borrower's or its Control
Entity's organizational documents or First Mortgage Loan Borrower's or its
Control Entity's organizational documents that would reasonably be expected to
have material adverse effect on any of such entities' bankruptcy remote status
or the assumptions set forth in the non-consolidation opinion delivered to
Mezzanine Lender or take any other action that would otherwise materially and
adversely affect the existence of Mezzanine Borrower, Control Entity of
Mezzanine Borrower, First Mortgage Loan Borrower or Control Entity of First
Mortgage Loan Borrower as a Special Purpose Bankruptcy Remote Entity, (ii)
without the prior written consent of Mezzanine Lender, which shall not be
unreasonably withheld or delayed, if same has been approved by First Mortgage
Lender, consent to the amendment, modification, waiver or termination of any
First Mortgage Loan Documents or the First Mortgage Loan Borrower's
organizational documents or (iii) without the prior written consent of Mezzanine
Lender, amend, modify, waive or terminate Mezzanine Borrower's, or its Control
Entity's organizational documents.

                      (y) (i) dissolve or liquidate, in whole or in part, or
         take any action that could have the effect of causing a dissolution or
         liquidation of any Subsidiary, (ii) consolidate or merge with or into
         any other entity, (iii) make an assignment for the benefit of
         creditors, file a petition in bankruptcy, petition or apply to any
         tribunal for the appointment of a custodian, receiver, trustee or other
         similar official for it, or for a substantial part of its property,
         commence any proceeding under any bankruptcy, reorganization,
         arrangement, readjustment or debt or liquidation law, or admit its
         inability to pay its debts generally as they become due (iv) cause or
         permit the Collateral or other assets or property of Mezzanine Borrower
         or First Mortgage Loan Borrower to be subject to any Lien other than as
         provided for in the Mezzanine Loan Documents or securing the First
         Mortgage Loan, (v) Transfer, in one transaction or a series of
         transactions, all, or substantially all, of its assets (vii) make any
         material changes in Mezzanine Borrower's present method of conducting
         business, or (viii) lend money to any Person.

                      (z) (i) undertake the incurrence or assumption on behalf
         of Mezzanine Borrower directly or indirectly, of any Indebtedness other
         than the Mezzanine Loan and the Permitted Indebtedness, or (ii) grant a
         security interest of any nature whatsoever in Mezzanine Borrower's
         assets other than as set forth in the Mezzanine Loan Documents.

                  (b) Liens on the Collateral. Incur, create, assume, become or
be liable in any manner with respect to, or permit to exist, any Lien with
respect to any Collateral, except (i) Liens in favor of Mezzanine Lender and
(ii) Liens being contested by Mezzanine Borrower in accordance with Section
5.1(c) or Liens which will be extinguished within thirty (30) days of the



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creation thereof. Mezzanine Borrower will not and will not permit First Mortgage
Loan Borrower to take any action that would have a material adverse effect on
the Liens created under the Mezzanine Loan Documents.

                  (c) Transfer. Except for a Permitted Transfer or as otherwise
approved by Mezzanine Lender in writing, allow any Transfer to occur.

                  (d) Other Indebtedness. Incur, create, assume, become or be
liable in any manner with respect to Indebtedness other than the Debt, Permitted
Indebtedness and Transaction Costs.

                  (e) Change In Business. Make any material change in the scope
or nature of its business objectives, purposes or operations, or undertake or
participate in activities other than the continuance of its present business.

                  (f) Debt Cancellation. Cancel or otherwise forgive or release
any material claim or debt owed to Mezzanine Borrower by any Person.

                  (g) Affiliate Transactions. Enter into, or be a party to, any
transaction with an Affiliate of Mezzanine Borrower, except in the ordinary
course of business and on terms which are no less favorable to Mezzanine
Borrower than would be obtained in a comparable arm's length transaction with an
unrelated third party, and, if the amount to be paid to the Affiliate pursuant
to the transaction or series of related transactions is greater than
($50,000.00) (determined annually on an aggregate basis) fully disclosed to
Mezzanine Lender in advance. Mezzanine Lender acknowledges that Mezzanine
Borrower has entered into the Management Agreement and those two (2) certain
Services Agreements each dated January 4, 2001 between Mezzanine Borrower and
Guarantor, which Mezzanine Lender agrees do not violate the provisions of this
covenant.

                  (h) Certain Restrictions. Enter into any agreement which
expressly restricts the ability of Mezzanine Borrower or First Mortgage Loan
Borrower to enter into amendments, modifications or waivers of any of the
Mezzanine Loan Documents.

                  (i) Issuance of Equity Interests. Issue or allow to be created
any stocks or shares or shareholder, partnership or membership interests, as
applicable, or other ownership interests other than those issued on the date
hereof with respect to, Mezzanine Borrower, the Control Entity of Mezzanine
Borrower, First Mortgage Loan Borrower or the Control Entity of First Mortgage
Loan Borrower except in accordance with a Permitted Transfer.

                  (j) Limitations on Distributions. Mezzanine Borrower shall not
accept any distribution from First Mortgage Loan Borrower in property other than
cash. Following the occurrence and during the continuance of an Event of
Default, Mezzanine Borrower shall not make any distributions to its partners,
shareholders or members. Mezzanine Borrower shall not distribute any proceeds
from Liquidation Event to its partners, shareholders or members until the First
Mortgage Loan and Mezzanine Loan have been repaid in full.

                  (k) Place of Business. Provided Mezzanine Borrower has
executed and delivered such financing statements and other documents requested
by Mezzanine Lender to



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continue perfected security interests in the Collateral, upon written notice to
Mezzanine Lender, change its name, chief executive office, principal place of
business or place where its books and records are kept.

                  (l) Identity. Change its identity or organizational structure
in any manner which would reasonably be expected to make any financing or
continuation statement filed in connection herewith seriously misleading within
the meaning of Section 9-402(7) of the UCC (or any other applicable provision of
the UCC).

                  (m) Subsidiaries. Create any Subsidiaries or otherwise acquire
equity interests in any entity without the prior written consent of Mezzanine
Lender.

                  (n) Other Limitations. Notwithstanding any provisions in the
Mezzanine Loan Documents or First Mortgage Loan Documents to the contrary,
Mezzanine Borrower shall not and shall not permit First Mortgage Loan Borrower
to, without the prior written consent of Mezzanine Lender, which consent may be
withheld, delayed or conditioned in the sole discretion of Mezzanine Lender,
give its consent or approval or agree to any of the following:

                      (i) (A) any refinancing or defeasance of the First
         Mortgage Loan, except for any extension rights expressly provided under
         Section 2.5 of the First Mortgage Loan Agreement unless the Debt is
         repaid in full upon the consummation of such refinancing or defeasance,
         (B) any prepayment or defeasance in full of the First Mortgage Loan,
         unless the Debt is repaid in full simultaneously with such prepayment,
         (C) any Transfer of any Collateral or the Property or any portion
         thereof or interest therein in violation of this Agreement, or (D) any
         action in connection with or in furtherance of the foregoing;

                      (ii) placing or permitting to attach any additional Liens
         on the Property or any of the Collateral; provided, however, that the
         consent of Mezzanine Lender shall not be required with respect to
         "Permitted Encumbrances" (as defined in the First Mortgage);

                      (iii) any material modification, amendment, consolidation,
         spread, restatement or waiver of any provision of the First Mortgage
         Loan Documents except as expressly provided under Article X of the
         First Mortgage Loan Agreement;

                      (iv) except in accordance with Section 5.1(j)(11) approve
         the terms of any operating budget or capital budget;

                      (v) enter into or cancel, terminate, abridge or otherwise
         modify the material terms of any Material Lease or accept a surrender
         thereof or consent to any assignment or sublet not in accordance with
         the terms of such lease and that effects the release of the tenant or
         guarantor thereunder;

                      (vi) settle any claim against Mezzanine Borrower, First
         Mortgage Loan Borrower or the Property, other than an insured third
         party claim, in any amount greater than $1,000,000 (singularly or in
         the aggregate with respect to the same claim) such consent to be given
         or withheld in the discretion of the Mezzanine Lender;



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                      (vii) except as may be required under the First Mortgage
         Loan Documents, terminate or replace the Manager or amend or modify the
         Management Agreement in any material respect;

                      (viii) enter into any Franchise Agreement with respect to
         the Property except as provided under the First Mortgage Loan Documents
         or, if same are no longer in effect, with the prior written consent of
         Mezzanine Lender which shall be in its sole discretion; or

                      (ix) seek or agree to the partition of the Property.

                  (o) Contractual Obligations. Other than the Mezzanine Loan
Documents, Mezzanine Borrower shall not enter into any agreement, instrument or
undertaking by which it or its assets are bound, except for Permitted
Indebtedness.

                                  ARTICLE VII

                                    DEFAULTS

                  Section 7.1. Event of Default. The occurrence of one or more
of the following events shall be an "Event of Default" hereunder:

                      (i) if Mezzanine Borrower fails to pay the outstanding
         Debt on the Maturity Date;

                      (ii) the occurrence of a Payment Breach, and such failure
         is not cured within one (1) Business Day after written notice thereof
         from Mezzanine Lender except that no notice is required with respect to
         any payment of interest under the Mezzanine Note;

                      (iii) the occurrence of the events identified elsewhere in
         the Mezzanine Loan Documents or the First Mortgage Loan Documents as
         constituting an "Event of Default" hereunder or thereunder;

                      (iv) any Transfer, other than a Permitted Transfer, unless
         Mezzanine Borrower has obtained the prior written consent of Mezzanine
         Lender (which consent may be withheld in Mezzanine Lender's sole and
         absolute discretion);

                      (v) if Mezzanine Borrower fails to pay any other amount
         payable pursuant to this Agreement or any other Mezzanine Loan Document
         when due and payable in accordance with the provisions hereof or
         thereof, as the case may be, and such failure is not cured within five
         (5) Business Days after written notice thereof from Mezzanine Lender;

                      (vi) if any representation or warranty made by Mezzanine
         Borrower, First Mortgage Loan Borrower or Manager herein or in any
         other Mezzanine Loan Document, or in any material report, Officer's
         Certificate, financial statement or other Instrument, agreement or
         document furnished by or on behalf of Mezzanine Borrower in



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         connection with this Agreement, the Mezzanine Note or any other
         Mezzanine Loan Documents executed and delivered by Mezzanine Borrower,
         shall be false in any material respect as of the date such
         representation or warranty was made or remade;

                      (vii) any violation of the covenants set forth in Section
         5.1(p), 6.1(a), 6.1(b), 6.1(l) or 6.1(n) of this Agreement;

                      (viii) if Mezzanine Borrower or Guarantor makes an
         assignment for the benefit of creditors;

                      (ix) if a receiver, liquidator or trustee shall be
         appointed for Mezzanine Borrower, Guarantor or First Mortgage Loan
         Borrower, or if Mezzanine Borrower, Guarantor or First Mortgage Loan
         Borrower shall be adjudicated as bankrupt or insolvent, or if any
         petition for bankruptcy, reorganization or arrangement pursuant to
         federal bankruptcy law, or any similar federal or state law, shall be
         filed by or against, consented to, or acquiesced in by Mezzanine
         Borrower, Guarantor or First Mortgage Loan Borrower, or if any
         proceeding for the dissolution or liquidation of Mezzanine Borrower,
         Guarantor or First Mortgage Loan Borrower shall be instituted, or if
         Guarantor or Mezzanine Borrower shall generally not be paying its debts
         as they become due;

                      (x) if Mezzanine Borrower delegates its obligations or
         assigns its rights under this Agreement, any of the other Mezzanine
         Loan Documents or any interest herein or therein;

                      (xi) if any provision of any organizational document of
         Mezzanine Borrower or First Mortgage Loan Borrower is amended or
         modified in any material respect, without the prior written consent of
         Mezzanine Lender, or if Mezzanine Borrower or First Mortgage Loan
         Borrower, as applicable, fails to perform or enforce the provisions of
         such organizational documents in any material respect or attempts to
         dissolve Mezzanine Borrower or First Mortgage Loan Borrower;

                      (xii) if an Event of Default exists under the First
         Mortgage Loan Documents or if Mezzanine Borrower fails to notify
         Mezzanine Lender of the occurrence of a Default under any of the First
         Mortgage Loan Documents within one (1) Business Day after the day on
         which Mezzanine Borrower first has knowledge of such Default;

                      (xiii) if an event or condition specified in Section
         5.1(k) shall occur or exist with respect to any Plan or Multiemployer
         Plan and, as a result of such event or condition, together with all
         other such events or conditions, Mezzanine Borrower or any ERISA
         Affiliate shall incur or in the opinion of Mezzanine Lender shall be
         reasonably likely to incur a liability to a Plan, a Multiemployer Plan
         or PBGC (or any combination of the foregoing) which would result in or
         constitute, in the reasonable determination of Mezzanine Lender, a
         Material Adverse Condition;

                      (xiv) if any financial statement, report or information
         contained in an Officer's Certificate provided to Mezzanine Lender by
         or on behalf of Mezzanine Borrower concerning the Mezzanine Borrower,
         First Mortgage Loan Borrower or the Property proves to be inaccurate or
         misleading in any material respect;



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                      (xv) if any material alteration, modification or removal
         of any Improvement or Equipment at the Property occurs, except as
         expressly permitted under the terms of the First Mortgage Loan
         Documents or this Agreement;

                      (xvi) if a judgment is entered against Mezzanine Borrower
         or First Mortgage Loan Borrower that materially and adversely affects
         Mezzanine Borrower's ability to perform its obligations under the
         Mezzanine Loan Documents, unless such judgment is paid in full or
         enforcement of such judgment against the Property or the Collateral is
         stayed or bonded over within thirty (30) days after the date of such
         judgment;

                      (xvii) if Mezzanine Borrower or First Mortgage Loan
         Borrower or any other Person shall fail to perform any of the other
         obligations, agreements, undertakings, terms, covenants, provisions or
         conditions of this Agreement, the Mezzanine Note, or the other
         Mezzanine Loan Documents, not otherwise referred to in this Section
         7.1., for twenty (20) Business Days after written notice to Mezzanine
         Borrower from Mezzanine Lender or its successors or assigns; provided
         that if such default cannot reasonably be cured within such twenty (20)
         Business Day period and the Mezzanine Borrower shall have commenced to
         cure such default within such twenty (20) day period and thereafter
         diligently and expeditiously proceeds to cure the same, such twenty
         (20) Business Day period shall be extended for so long as it shall
         require Mezzanine Borrower in the exercise of due diligence to cure
         such default, it being agreed that no such extension shall be for a
         period in excess of sixty (60) days or shall extend beyond the date
         upon which such default causes an Event of Default to occur under the
         First Mortgage Loan Documents; or

                      (xviii) if, for any calendar quarter, the DSCR is less
         than 1.05 or the Debt Yield is less than 12.5% based in each case on a
         trailing twelve (12) month period.

                  Section 7.2. Remedies. Upon the occurrence of an Event of
Default, all or any one or more of the rights, powers and other remedies
available to Mezzanine Lender against Mezzanine Borrower or its Affiliates under
this Agreement, the Mezzanine Note, or any of the other Mezzanine Loan
Documents, or at law or in equity may be exercised by Mezzanine Lender at any
time and from time to time (including, without limitation, the right to
accelerate and declare the outstanding principal amount, unpaid interest,
Default Rate interest, Late Charges, and any other amounts owing by Mezzanine
Borrower to be immediately due and payable), without notice or demand, whether
or not all or any portion of the Debt shall be declared due and payable, and
whether or not Mezzanine Lender shall have commenced any foreclosure proceeding
or other action for the enforcement of its rights and remedies under any of the
Mezzanine Loan Documents with respect to all or any portion of the Collateral.
Any such actions taken by Mezzanine Lender shall be cumulative and concurrent
and may be pursued independently, singly, successively, together or otherwise,
at such time and in such order as Mezzanine Lender may determine in its
discretion, to the fullest extent permitted by law, without impairing or
otherwise affecting the other rights and remedies of Mezzanine Lender permitted
by law, equity or contract or as set forth herein or in the other Mezzanine Loan
Documents. Notwithstanding anything contained to the contrary herein, the
outstanding principal amount, unpaid interest, Default Rate interest, Late
Charges, and any other amounts owing by Mezzanine



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Borrower shall be accelerated and immediately due and payable, without any
election by Mezzanine Lender upon the occurrence of an Event of Default
described in Section 7.1(viii) or Section 7.1(ix).

                  Section 7.3. Remedies Cumulative. The rights, powers and
remedies of Mezzanine Lender under this Agreement shall be cumulative and not
exclusive of any other right, power or remedy which Mezzanine Lender may have
against Mezzanine Borrower pursuant to this Agreement or the other Mezzanine
Loan Documents executed by or with respect to Mezzanine Borrower, or existing at
law or in equity or otherwise. Mezzanine Lender's rights, powers and remedies
may be pursued singly, concurrently or otherwise, at such time and in such order
as Mezzanine Lender may determine in Mezzanine Lender's discretion. No delay or
omission to exercise any remedy, right or power accruing upon an Event of
Default shall impair any such remedy, right or power or shall be construed as a
waiver thereof, but any such remedy, right or power may be exercised from time
to time and as often as may be deemed expedient. A waiver of any Default or
Event of Default shall not be construed to be a waiver of any subsequent Default
or Event of Default or to impair any remedy, right or power consequent thereon.
Any and all of Mezzanine Lender's rights with respect to the Collateral shall
continue unimpaired, and Mezzanine Borrower shall be and remain obligated in
accordance with the terms hereof, notwithstanding (a) the release or
substitution of Collateral at any time, or of any rights or interest therein or
(b) any delay, extension of time, renewal, compromise or other indulgence
granted by Mezzanine Lender in the event of any Default or Event of Default with
respect to the Collateral or otherwise hereunder.

                  Section 7.4. Mezzanine Lender's Right to Perform. If Mezzanine
Borrower fails to perform any covenant or obligation contained herein and such
failure shall continue for a period of (5) five Business Days after Mezzanine
Borrower's receipt of written notice thereof from Mezzanine Lender, without in
any way limiting Section 7.1 hereof, Mezzanine Lender may, but shall have no
obligation to, itself perform, or cause performance of, such covenant or
obligation, and the reasonable expenses of Mezzanine Lender incurred in
connection therewith shall be payable by Mezzanine Borrower to Mezzanine Lender
upon demand. Notwithstanding the foregoing, Mezzanine Lender shall have no
obligation to send notice to Mezzanine Borrower of any such failure.

                                  ARTICLE VIII

                                  MISCELLANEOUS

                  Section 8.1. Survival. Subject to Section 4.2, this Agreement
and all covenants, agreements, representations and warranties made herein and in
the certificates delivered pursuant hereto shall survive the execution and
delivery of this Agreement and the execution and delivery by Mezzanine Borrower
to Mezzanine Lender of the Mezzanine Note, and shall continue in full force and
effect so long as any portion of the Debt is outstanding and unpaid. Whenever in
this Agreement any of the parties hereto is referred to, such reference shall be
deemed to include the successors and assigns of such party. All covenants,
promises and agreements in this Agreement contained, by or on behalf of
Mezzanine Borrower, shall inure to the benefit of the respective successors and
assigns of Mezzanine Lender. Nothing in this Agreement or in any other Mezzanine
Loan Document, express or implied, shall give to any Person other than the
parties



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and the holder(s) of the Mezzanine Note (or any interest therein), and the other
Mezzanine Loan Documents, and their legal representatives, successors and
assigns, any benefit or any legal or equitable right, remedy or claim hereunder.

                  Section 8.2. Mezzanine Lender's Discretion. Whenever pursuant
to this Agreement or any other Mezzanine Loan Document, Mezzanine Lender
exercises any right, option or election given to Mezzanine Lender to approve or
disapprove, or consent or withhold consent, or any arrangement or term is to be
satisfactory to Mezzanine Lender or is to be in Mezzanine Lender's discretion,
the decision of Mezzanine Lender to approve or disapprove, consent or withhold
consent, or to decide whether arrangements or terms are satisfactory or not
satisfactory or acceptable or not acceptable to Mezzanine Lender in Mezzanine
Lender's discretion, shall (except as is otherwise specifically herein provided)
be in the sole and absolute discretion of Mezzanine Lender.

                  Section 8.3. Governing Law. (a) This Agreement and the
obligations arising hereunder shall be governed by, and construed in accordance
with, the laws of the State of New York applicable to contracts made and
intended to be performed in such State, without giving effect to principles of
conflicts of laws, and any applicable law of the United States of America. To
the fullest extent permitted by law, Mezzanine Borrower hereby unconditionally
and irrevocably waives any claim to assert that the law of any other
jurisdiction governs this Agreement and the Mezzanine Note, and this Agreement
and the Mezzanine Note shall be governed by and construed in accordance with the
internal laws of the State of New York, without giving effect to principles of
conflicts of laws.

                  (b) ANY LEGAL SUIT, ACTION OR PROCEEDING AGAINST MEZZANINE
BORROWER ARISING OUT OF OR RELATING TO THIS AGREEMENT SHALL BE INSTITUTED IN ANY
FEDERAL OR STATE COURT IN NEW YORK OR IN ANY FEDERAL OR STATE COURT IN ANY
JURISDICTION IN WHICH ANY COLLATERAL IS LOCATED, AND MEZZANINE BORROWER HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING,
AND MEZZANINE BORROWER HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE
JURISDICTION OF ANY SUCH COURT IN ANY SUIT, ACTION OR PROCEEDING. MEZZANINE
BORROWER DOES HEREBY DESIGNATE AND APPOINT CORPORATION SERVICE COMPANY, WHOSE
ADDRESS IS 2 WORLD TRADE CENTER, SUITE 8746, NEW YORK, NEW YORK 10048 AS ITS
AUTHORIZED AGENT TO ACCEPT AND ACKNOWLEDGE ON ITS BEHALF SERVICE OF ANY AND ALL
PROCESS WHICH MAY BE SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING IN ANY
FEDERAL OR STATE COURT AND AGREES THAT SERVICE OF PROCESS UPON SAID AGENT AT
SAID ADDRESS (OR AT SUCH OTHER OFFICE AS MAY BE DESIGNATED BY MEZZANINE BORROWER
FROM TIME TO TIME IN ACCORDANCE WITH THE TERMS HEREOF) WITH A COPY TO SUCH
APPLICABLE MEZZANINE BORROWER AT 535 MARRIOTT DRIVE, SUITE 600, NASHVILLE,
TENNESSEE 37214 ATTENTION: CHIEF FINANCIAL OFFICER, AND WRITTEN NOTICE OF SAID
SERVICE OF MEZZANINE BORROWER MAILED OR DELIVERED TO MEZZANINE BORROWER IN THE
MANNER PROVIDED HEREIN SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF
PROCESS UPON MEZZANINE



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BORROWER, IN ANY SUCH SUIT, ACTION OR PROCEEDING. MEZZANINE BORROWER (I) SHALL
GIVE PROMPT NOTICE TO MEZZANINE LENDER OF ANY CHANGED ADDRESS OF ITS AUTHORIZED
AGENT HEREUNDER, (II) MAY AT ANY TIME AND FROM TIME TO TIME DESIGNATE A
SUBSTITUTE AUTHORIZED AGENT (WHICH OFFICE SHALL BE DESIGNATED AS THE ADDRESS FOR
SERVICE OF PROCESS), AND (III) SHALL PROMPTLY DESIGNATE SUCH A SUBSTITUTE IF ITS
AUTHORIZED AGENT CEASES TO HAVE AN OFFICE OR IS DISSOLVED WITHOUT LEAVING A
SUCCESSOR.

                  Section 8.4. Modification, Waiver in Writing. No modification,
amendment, extension, discharge, termination or waiver of any provision of this
Agreement, the Mezzanine Note or any other Mezzanine Loan Document, or consent
to any departure by Mezzanine Borrower or any of its Affiliates therefrom, shall
in any event be effective unless the same shall be in a writing signed by the
party against whom enforcement is sought, and then such waiver or consent shall
be effective only in the specific instance, and for the purpose, for which
given. Except as otherwise expressly provided herein, no notice to or demand on
Mezzanine Borrower shall entitle Mezzanine Borrower to any other or future
notice or demand in the same, similar or other circumstances.

                  Section 8.5. Delay Not a Waiver. Neither any failure nor any
delay on the part of Mezzanine Lender in insisting upon strict performance of
any term, condition, covenant or agreement, or exercising any right, power,
remedy or privilege hereunder, or under the Mezzanine Note, or of any other
Mezzanine Loan Document, shall operate as or constitute a waiver thereof (except
as expressly provided herein to the contrary), nor shall a single or partial
exercise thereof preclude any other future exercise, or the exercise of any
other right, power, remedy or privilege. In particular, and not by way of
limitation, by accepting payment after the due date of any amount payable under
this Agreement, the Mezzanine Note or any other Mezzanine Loan Document,
Mezzanine Lender shall not be deemed to have waived any right either to require
prompt payment when due of all other amounts due under this Agreement, the
Mezzanine Note or the other Mezzanine Loan Documents, or to declare a default
for failure to effect prompt payment of any such other amount.

                  Section 8.6. Notices. All notices, consents, approvals and
requests required or permitted hereunder or under any other Mezzanine Loan
Document shall be given in writing and shall be effective for all purposes if
hand delivered or sent by (a) hand delivery, with proof of attempted delivery,
(b) certified or registered United States mail, postage prepaid, (c) expedited
prepaid delivery service, either commercial or United States Postal Service,
with proof of attempted delivery, or (d) by telecopier (with answer back
acknowledged) provided that such telecopied notice must also be delivered by one
of the means set forth in (a), (b) or (c) above, addressed if to Mezzanine
Lender at its address set forth on the first page hereof, and if to Mezzanine
Borrower at its designated address set forth on the first page hereof, with a
copy to Sherrard & Roe, LLC, 424 Church Street, Suite 2000, Nashville, Tennessee
37219, Attention: Kim Brown, Esq., or at any other address and Person as shall
be designated from time to time by any party hereto, as the case may be, in a
written notice to the other parties hereto in the manner provided for in this
Section 8.6. A copy of all notices, consents, approvals and requests directed to
Mezzanine Lender shall be delivered concurrently to each of the following:
Merrill Lynch Mortgage Capital Inc., Four World Financial Center, Tenth Floor,
New York, New York 10080,



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<PAGE>   80

Attention: Steven Glassman and Sidley & Austin, 875 Third Avenue, New York, New
York 10022, Attention: Alan S. Weil, Esq. A notice shall be deemed to have been
given: (a) in the case of hand delivery, at the time of delivery; (b) in the
case of registered or certified mail, when delivered or the first attempted
delivery on a Business Day; (c) in the case of expedited prepaid delivery upon
the first attempted delivery on a Business Day; or (d) in the case of
telecopier, upon receipt of answer back confirmation, provided that such
telecopied notice was also delivered as required in this Section 8.6. A party
receiving a notice which does not comply with the technical requirements for
notice under this Section 8.6 may elect to waive any deficiencies and treat the
notice as having been properly given. If a party refuses delivery, such party
shall be deemed to have received notice on the date of attempted delivery, as
evidenced by courier's or post office proof of attempted delivery.

                  Section 8.7. TRIAL BY JURY. MEZZANINE BORROWER AND MEZZANINE
LENDER, TO THE FULLEST EXTENT THAT THEY MAY LAWFULLY DO SO, EACH HEREBY WAIVE
TRIAL BY JURY IN ANY ACTION OR PROCEEDING, INCLUDING, WITHOUT LIMITATION, ANY
TORT ACTION, BROUGHT BY ANY PARTY HERETO WITH RESPECT TO THIS AGREEMENT, THE
MEZZANINE NOTE OR THE OTHER MEZZANINE LOAN DOCUMENTS.

                  Section 8.8. Headings. The Article and Section headings in
this Agreement are included herein for convenience of reference only and shall
not constitute a part of this Agreement for any other purpose.

                  Section 8.9. Assignment. Mezzanine Lender shall, at its sole
cost and expense, have the right to assign in whole or in part this Agreement
and/or any of the other Mezzanine Loan Documents and the obligations hereunder
or thereunder to any Person and to sell or otherwise transfer participation
interests in all or any portion of the Mezzanine Loan evidenced hereby.

                  Section 8.10. Severability. Wherever possible, each provision
of this Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Agreement.

                  Section 8.11. Preferences. Mezzanine Lender shall have no
obligation to marshal any assets in favor of Mezzanine Borrower or any other
party or against or in payment of any or all of the obligations of Mezzanine
Borrower pursuant to this Agreement, the Mezzanine Note or any other Mezzanine
Loan Document. Mezzanine Lender shall have the continuing and exclusive right to
apply or reverse and reapply any and all payments by Mezzanine Borrower to any
portion of the obligations of Mezzanine Borrower hereunder. To the extent
Mezzanine Borrower makes a payment or payments to Mezzanine Lender for Mezzanine
Borrower's benefit, which payment or receipt of proceeds or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
or required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, state or federal law, common law or equitable cause, then, to
the extent of such payment or proceeds received, the obligations hereunder or
part



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thereof intended to be satisfied shall be revived and continue in full force and
effect, as if such payment or proceeds had not been received by Mezzanine
Lender.

                  Section 8.12. Waiver of Notice. Neither Mezzanine Borrower nor
any of its Affiliates shall be entitled to any notices of any nature whatsoever
from Mezzanine Lender except with respect to matters for which this Agreement or
the other Mezzanine Loan Documents specifically and expressly provide for the
giving of notice by Mezzanine Lender to Mezzanine Borrower or an Affiliate
thereof and except with respect to matters for which Mezzanine Borrower and any
applicable Affiliate are not, pursuant to applicable Legal Requirements,
permitted to waive the giving of notice. Mezzanine Borrower hereby expressly
waives the right to receive any notice from Mezzanine Lender with respect to any
matter for which this Agreement or the other Mezzanine Loan Documents does not
specifically and expressly provide for the giving of notice by Mezzanine Lender
to Mezzanine Borrower.

                  Section 8.13. Remedies of Mezzanine Borrower. In the event
that a claim or adjudication is made that Mezzanine Lender or its agents have
acted unreasonably or unreasonably delayed acting in any case where by law or
under this Agreement, the Mezzanine Note, or the other Mezzanine Loan Documents,
Mezzanine Lender or such agent, as the case may be, has an obligation to act
reasonably or promptly, then in such event Mezzanine Borrower's sole remedy
shall be to commence an action seeking injunctive relief or declaratory
judgment.

                  Section 8.14. Joint and Several Liability. Subject to Section
8.15, if at any time Mezzanine Borrower is comprised of more than one (1)
Person, the Mezzanine Loan and Mezzanine Borrower's obligations thereunder shall
be the joint and several obligation of each of such Persons comprising Mezzanine
Borrower.

                  Section 8.15. Limited Recourse; Additional Indemnity
Obligation.

                  (a) Anything contained in this Agreement or in the Mezzanine
Note or the other Mezzanine Loan Documents to the contrary notwithstanding,
except as set forth in clauses (b) and (c) of this Section 8.15, Mezzanine
Lender's recourse for the satisfaction of the indebtedness due under the
Mezzanine Note and for the payment and performance of all of the obligations and
liabilities of Mezzanine Borrower under this Agreement, the Mezzanine Note and
the other Mezzanine Loan Documents shall be limited solely to Mezzanine
Borrower's interest in the Collateral, and, subject to clauses (b) and (c) of
this Section 8.15, none of Mezzanine Borrower or any direct or indirect partner,
member, shareholder, principal, Affiliate, employee, officer, director, agent or
representative of Mezzanine Borrower (each, a "Related Party") shall have any
personal liability in any other respect for (i) the payment of the principal of
or interest or premium, if any, on the Mezzanine Note, (ii) the payment of any
other amount due under the Mezzanine Note, this Agreement or any of the other
Mezzanine Loan Documents, or (iii) for damages for the breach of, or any costs
or expenses associated with the performance of or failure to perform, any of the
covenants, obligations, representations and warranties or indemnifications
contained herein or in the Mezzanine Note or any of the other Mezzanine Loan
Documents. The provisions of this Section 8.15 shall not, however, (i) impair
the validity of the obligations of Mezzanine Borrower or in any way affect or
impair any Lien or the right of Mezzanine Lender to enforce any and all rights
and remedies under and by virtue of the



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Mezzanine Note, this Agreement, or any other Mezzanine Loan Document including,
without limitation, naming Mezzanine Borrower as a party defendant in any
action, or limit Mezzanine Lender from pursuing or seeking to enforce the rights
of Mezzanine Lender against any third parties, including any guarantor,
indemnitor or surety under any guaranty or indemnity delivered in connection
with this Agreement, the Mezzanine Note, or otherwise in connection with the
Mezzanine Loan, (ii) constitute a waiver, release or impairment of any
obligation evidenced or secured by this Agreement, the Mezzanine Note or any of
the other Mezzanine Loan Documents, (iii) impair the enforcement against the
Collateral of the (a) security interests in respect of the Accounts, or (b)
security interests and rights and remedies of Mezzanine Lender described in the
Equity Pledge Agreements against the pledgors thereunder or (iv) constitute a
waiver of any right that Mezzanine Lender may have under Sections 506(a),
506(b), 1111(b) or any other provisions of the Bankruptcy Code to file a claim
for the full amount of the Mezzanine Loan or to require that all Collateral
shall continue to secure all of the Mezzanine Loan owing to Mezzanine Lender.

                  (b) Notwithstanding the limitations on liability set forth in
Section 8.15(a), Mezzanine Borrower shall be fully and personally liable for any
liabilities, costs, losses (including, without limitation, any reduction in
value of the Property or any other Collateral or the loss of any such Collateral
or Mezzanine Lender's security interest therein), damages, expenses (including,
without limitation, reasonable attorneys' fees and disbursements, and court
costs, if any), or claims (such liabilities, costs, losses, damages, expenses
and claims, collectively, the "Recourse Obligations") suffered or incurred by
Mezzanine Lender (or any Indemnified Party) by reason of or in connection with
(1) any fraud or breach of trust, or any material misrepresentation contained in
any Mezzanine Loan Document or any report furnished pursuant to any Mezzanine
Loan Document, by Mezzanine Borrower or any Related Party, (2) the
misappropriation of any proceeds of Insurance or Awards by Mezzanine Borrower or
any Related Party, (3) the misapplication by Mezzanine Borrower or any Related
Party (or at any such Person's direction) of funds held in or paid out from any
Account (including any reserve or escrow) maintained under this Agreement, or
any of the other Mezzanine Loan Documents, (4) any and all Security Deposits
held by Mezzanine Borrower or any Related Party not being properly applied,
returned to Tenants when due or delivered to Mezzanine Lender, any receiver or
any Person purchasing the Property or any part thereof at a foreclosure sale
upon the taking of possession of the Property or any part thereof by Mezzanine
Lender, such receiver or other Person as provided herein, (5) wrongful removal
or destruction of property constituting the Property or any intentional waste of
the Property by Mezzanine Borrower or any Related Party, (6) any Legal
Requirement mandating the forfeiture by Mezzanine Borrower or any Related Party
of the Property, or any portion thereof or of any interest in Mezzanine
Borrower, or any part thereof because of the conduct or purported conduct of
criminal activity by Mezzanine Borrower or any Related Party in connection
therewith, (7) any damage or destruction of the Property or any part thereof due
to fire or other casualty to the extent not covered by required Insurance, but
only to the extent the same would have been covered by insurance if Mezzanine
Borrower had obtained and maintained the required Insurance, (8) except for
Liens expressly permitted under the terms of this Agreement, the amount of any
Lien voluntary placed on the Property by Mezzanine Borrower (or any
predecessor-owner which is an Affiliate of Mezzanine Borrower) including,
without limitation, those arising from the failure to pay any valid taxes or
assessments with respect to the Property when cash or proceeds are available to
pay such taxes or assessments other than Permitted Indebtedness or any
Indebtedness incurred by Mezzanine



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Borrower in contravention of the provisions of Section 6.1(b) of this Agreement,
(9) the breach of any of the representations and warranties contained in Section
4.1(gg) with respect to Hazardous Substances, (10) the cost of enforcement of
any of Mezzanine Lender's rights or remedies hereunder or under any of the other
Mezzanine Loan Documents, or costs incurred in any bankruptcy or similar
proceeding which may be brought by Mezzanine Borrower or any Related Party, (11)
Mezzanine Borrower's or First Mortgage Loan Borrower's failure to furnish upon
Mezzanine Lender's or Title Insurer's request any of the affidavits and
indemnities required under Section 3.1(a)(7), (12) any failure to deposit Excess
Cash Flow into the Deposit Account due to a Cash Sweep Event in accordance with
Section 2.12(a) hereof, and (13) Mezzanine Borrower's or First Mortgage Loan
Borrower's failure to pay the Water and Sewerage Settlement Amount to the extent
that such amount is not in a reserve held by Mezzanine Lender.

                  (c) In addition, the Debt shall be fully recourse to Mezzanine
Borrower, if: (A) Mezzanine Borrower or First Mortgage Loan Borrower filing a
voluntary petition under the Bankruptcy Code or any other Federal or state
bankruptcy or insolvency law; or (B) any Related Party controlled, directly or
indirectly, by Mezzanine Borrower, or by an Affiliate which controls, directly
or indirectly, Mezzanine Borrower, filing, or joining in the filing of, an
involuntary petition against Mezzanine Borrower or First Mortgage Loan Borrower
under the Bankruptcy Code or any other Federal or state bankruptcy or insolvency
law, or soliciting or causing to be solicited petitioning creditors for any
involuntary petition against Mezzanine Borrower or First Mortgage Loan Borrower
from any Person; or (C) Mezzanine Borrower or First Mortgage Loan Borrower
filing an answer consenting to or joining in any involuntary petition filed
against it or against Mezzanine Borrower or First Mortgage Loan Borrower or any
Related Party controlled by Mezzanine Borrower or controlling Mezzanine
Borrower, or any of them, by any other Person under the Bankruptcy Code or any
other Federal or state bankruptcy or insolvency law, or soliciting or causing to
be solicited from any Person petitioning creditors for any involuntary petition
against First Mortgage Loan Borrower, Mezzanine Borrower or any Related Party
controlled by Mezzanine Borrower or controlling Mezzanine Borrower, or any of
their respective Affiliates; or (D) any Related Party controlled, directly or
indirectly, by Mezzanine Borrower or First Mortgage Loan Borrower or by any
Affiliate which controls, directly or indirectly, Mezzanine Borrower or First
Mortgage Loan Borrower consenting to or joining in an application for the
appointment of a custodian, receiver, trustee or examiner for Mezzanine Borrower
or First Mortgage Loan Borrower or any portion of the Collateral (unless such
action is at the request of Mezzanine Lender or First Mortgage Lender) or any
such Related Party voting adversely to Mezzanine Lender's interest in any
proceeding under the Bankruptcy Code or any other state or federal bankruptcy or
insolvency law which involves Mezzanine Borrower, First Mortgage Loan Borrower,
the Collateral or the Property; or (E) Mezzanine Borrower or First Mortgage Loan
Borrower making an assignment for the benefit of creditors, or admitting, in
writing or in any legal proceeding, its insolvency or inability to pay its debts
as they become due; or (F) Mezzanine Borrower or any Related Party controlled by
Mezzanine Borrower or controlling Mezzanine Borrower contesting or in any
material way interfering with, directly or indirectly (collectively, a
"Contest"), any foreclosure action, Uniform Commercial Code sale or other
material remedy commenced by Mezzanine Lender under the Equity Pledge Agreements
or this Agreement (whether by making any motion, bringing any counterclaim,
claiming any defense, seeking any injunction or other restraint, commencing any
action, or otherwise), provided that if any such Related Party obtains a
non-appealable order successfully



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asserting a Contest, such Related Party shall have no liability under this
clause (F); or (G) any of the representations and warranties contained in
Sections 5.1(l), (p) and (q) of this Agreement are breached, and if, as a result
thereof, the assets of Mezzanine Borrower are consolidated with the assets of
any of its constituent members (or its members' constituent partners or
members), or (H) any Transfer occurs in violation of Section 6.1(c) of this
Agreement; or (I) if any monetary Lien in excess of $100,000 is voluntarily
placed on the Property or the Collateral or any portion of either; or (J) if the
First Mortgage Loan Documents are modified or amended in any material respect or
consolidated, spread, restated or waived by the action of First Mortgage Loan
Borrower or any Related Party without obtaining the prior written consent of
Mezzanine Lender; or (K) if First Mortgage Loan Borrower refinances the First
Mortgage Loan and any proceeds of such financing in excess of the amount
necessary to repay the First Mortgage Loan are not paid to Mezzanine Lender to
repay the Debt.

                  Section 8.16. Exhibits Incorporated. The information set forth
on the cover, heading and recitals hereof, and the Exhibits and Schedules
attached hereto, are hereby incorporated herein as a part of this Agreement with
the same effect as if set forth in the body hereof.

                  Section 8.17. Offsets, Counterclaims and Defenses. Any
assignee of Mezzanine Lender's interest in and to this Agreement, the Mezzanine
Note, and the other Mezzanine Loan Documents shall take the same free and clear
of all offsets, counterclaims or defenses which are unrelated to the Mezzanine
Loan, this Agreement, the Mezzanine Note, and the other Mezzanine Loan Documents
which Mezzanine Borrower or any of its Affiliates may otherwise have against any
assignor, and no such unrelated counterclaim or defense shall be interposed or
asserted by Mezzanine Borrower or any of its Affiliates in any action or
proceeding brought by any such assignee upon this Agreement, the Mezzanine Note,
and other Mezzanine Loan Documents and any such right to interpose or assert any
such unrelated offset, counterclaim or defense in any such action or proceeding
is hereby expressly waived by Mezzanine Borrower and First Mortgage Loan
Borrower.

                  Section 8.18. No Joint Venture or Partnership. Mezzanine
Borrower and Mezzanine Lender intend that the relationship created hereunder be
solely that of borrower and lender. Nothing herein is intended to create a joint
venture, partnership, tenancy-in-common, or joint tenancy relationship between
Mezzanine Borrower and Mezzanine Lender.

                  Section 8.19. Waiver of Marshaling of Assets Defense. To the
fullest extent that Mezzanine Borrower may legally do so, Mezzanine Borrower
waives all rights to a marshalling of the assets of Mezzanine Borrower, and
others with interests in Mezzanine Borrower, and of the Collateral, or to a sale
in inverse order of alienation in the event of foreclosure of the interests
hereby created, and agrees not to assert any right under any laws pertaining to
the marshalling of assets, the sale in inverse order of alienation, homestead
exemption, the administration of estates of decedents, or any other matters
whatsoever to defeat, reduce or affect the right of Mezzanine Lender under the
Mezzanine Loan Documents to a sale of the Collateral for the collection of the
Indebtedness without any prior or different resort for collection, or the right
of Mezzanine Lender to the payment of the Indebtedness in preference to every
other claimant whatsoever.



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<PAGE>   85

                  Section 8.20. Waiver of Counterclaim. Each of Mezzanine
Borrower and First Mortgage Loan Borrower hereby waives the right to assert a
counterclaim, other than compulsory counterclaim, in any action or proceeding
brought against Mezzanine Borrower or First Mortgage Loan Borrower by Mezzanine
Lender or Mezzanine Lender's agents.

                  Section 8.21. Conflict; Construction of Documents. In the
event of any conflict between the provisions of this Agreement and the
provisions of the Mezzanine Note, or any of the other Mezzanine Loan Documents,
the provisions of this Agreement shall prevail. The parties hereto acknowledge
that they were represented by independent counsel in connection with the
negotiation and drafting of the Mezzanine Loan Documents and that the Mezzanine
Loan Documents shall not be subject to the principle of construing their meaning
against the party which drafted same.

                  Section 8.22. Brokers and Financial Advisors. Mezzanine
Borrower and Mezzanine Lender hereby represent that they have dealt with no
financial advisors, brokers, underwriters, placement agents, agents or finders
in connection with the transactions contemplated by this Agreement. Mezzanine
Borrower hereby agrees to indemnify and hold Mezzanine Lender harmless from and
against any and all claims, liabilities, costs and expenses of any kind in any
way relating to or arising from a claim by any Person that such Person acted on
behalf of Mezzanine Borrower in connection with the transactions contemplated
herein. The provisions of this Section shall survive the expiration and
termination of this Agreement and the repayment of the Debt.

                  Section 8.23. Counterparts. This Agreement may be executed in
any number of counterparts, each of which when so executed and delivered shall
be an original, but all of which shall together constitute one and the same
instrument.

                  Section 8.24. Payment of Expenses. Mezzanine Borrower shall,
whether or not the Transactions are consummated, pay all Transaction Costs,
which shall include, without limitation, all commitment fees due and payable at
closing and all reasonable out-of-pocket fees, costs, expenses, and
disbursements of Mezzanine Lender and its attorneys, local counsel, accountants
and other contractors in connection with (i) the negotiation, preparation,
execution and delivery of the Mezzanine Loan Documents and the documents and
instruments referred to therein, (ii) the creation, perfection or protection of
Mezzanine Lender's Liens in the Collateral (including, without limitation, fees
and expenses for title and lien searches and filing and recording fees,
intangibles taxes, personal property taxes, mortgage recording taxes, due
diligence expenses, travel expenses), (iii) the negotiation, preparation,
execution and delivery of any amendment, waiver or consent relating to any of
the Mezzanine Loan Documents, and (iv) the preservation of rights under and
enforcement of the Mezzanine Loan Documents and the documents and instruments
referred to therein, including any restructuring or rescheduling of the Debt.

                  Section 8.25. Bankruptcy Waiver. Each of Mezzanine Borrower
and First Mortgage Loan Borrower hereby agrees that, in consideration of the
recitals and mutual covenants contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, if
Mezzanine Borrower or First Mortgage Loan Borrower (i) files with any bankruptcy
court of competent jurisdiction or is the subject of any



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petition under Title 11 of the U.S. Code, as amended, (ii) is the subject of any
order for relief issued under Title 11 of the U.S. Code, as amended, (iii) files
or is the subject of any petition seeking any reorganization, arrangement,
composition, readjustment, liquidation, dissolution or similar relief under any
present or future law relating to bankruptcy, insolvency or other relief of
debtors, (iv) has sought or consents to or acquiesces in the appointment of any
trustee, receiver, conservator or liquidator or (v) is the subject of any order,
judgment or decree entered by any court of competent jurisdiction approving a
petition filed against such party for any reorganization, arrangement,
composition, readjustment, liquidation, dissolution or similar relief under any
present or future federal or state act or law relating to bankruptcy, insolvency
or other relief for debtors, the automatic stay provided by the Federal
Bankruptcy Code and any other such statute shall be modified and annulled as to
Mezzanine Lender, so as to permit Mezzanine Lender to exercise any and all of
its rights and remedies, upon request of Mezzanine Lender made on notice to
Mezzanine Borrower or First Mortgage Loan Borrower and any other party in
interest but without the need of further proof or hearing. Neither Mezzanine
Borrower nor First Mortgage Loan Borrower nor any other Affiliate of Mezzanine
Borrower shall contest the enforceability of this Section.

                  Section 8.26. Entire Agreement. This Agreement, together with
the Exhibits hereto and the other Mezzanine Loan Documents constitutes the
entire agreement among the parties hereto with respect to the subject matter
contained in this Agreement, the Exhibits hereto and the other Mezzanine Loan
Documents and supersedes all prior agreements, understandings and negotiations
between the parties.

                  Section 8.27. Dissemination of Information. Subject to Section
8.28, if Mezzanine Lender determines at any time to sell, transfer or assign the
Mezzanine Note, this Mezzanine Loan Agreement and any other Mezzanine Loan
Document and any or all servicing rights with respect thereto, or to grant
participations therein or issue mortgage pass-through certificates or other
securities evidencing a beneficial interest in a rated or unrated public
offering or private placement, Mezzanine Lender may forward to each purchaser,
transferee, assignee, servicer, participant or investor in such securities
(collectively, the "Investor") or any Rating Agency rating such securities and
each prospective Investor, all documents and information which Mezzanine Lender
now has or may hereafter acquire relating to the Mezzanine Loan, Mezzanine
Borrower, First Mortgage Loan Borrower, any guarantor, any indemnitor and the
Property, which shall have been furnished by or on behalf of Mezzanine Borrower,
First Mortgage Loan Borrower, any guarantor, any indemnitor, or any party to any
Mezzanine Loan Document , or otherwise furnished in connection with the
Mezzanine Loan, as Mezzanine Lender in its discretion determines necessary or
desirable.

                  Section 8.28. Confidentiality. Each of Mezzanine Lender and
Mezzanine Borrower agrees to keep information regarding this Agreement and
information obtained by it pursuant hereto confidential and agrees that it will
use such information only in connection with the transactions contemplated by
this Agreement and not disclose any of such information to other Persons, other
than (a) to such Person's employees, representatives and agents who are or are
expected to be involved in the evaluation of such information in connection with
the transactions contemplated by this Agreement and who are advised of the
confidential nature of such information, (b) to the extent such information
presently is or hereafter becomes available to such Person on a non-confidential
basis from a source other than this Agreement, (c) to the



                                       83
<PAGE>   87

extent disclosure is required by law, regulation or judicial order, or requested
or required by bank regulators or auditors, (d) to any Rating Agency in
connection with a Securitization or the rating of the Certificates, or (e) to
prospective assignees, participants or transferees of the Mezzanine Loan,
including in connection with transactions contemplated in Section 8.34.

                  Section 8.29. Indemnification.

                  (a) In addition to any other indemnifications provided for
herein or in the other Mezzanine Loan Documents (but subject to Section 8.15),
Mezzanine Borrower shall protect, defend, indemnify and hold harmless Mezzanine
Lender and each of its Affiliates and their respective successors and assigns
(including their respective trustees, officers, directors, partners, employees,
attorneys, accountants, professionals and agents and each other person, if any,
controlling Mezzanine Lender or any of its affiliates within the meaning of
either Section 15 of the Securities Act of 1933, as amended, or Section 20 of
the Securities Exchange Act of 1934, as amended) (each, including Mezzanine
Lender, an "Indemnified Party") from and against all liabilities, obligations,
claims, and, damages, penalties, causes of action, losses, fines, costs,
expenses (including, without limitation, reasonable attorneys' fees and
disbursements) imposed upon or incurred by or asserted against any Indemnified
Party (other than by reason of such Indemnified Party's default under the
Mezzanine Loan Documents or gross negligence or willful misconduct, as
determined to have occurred pursuant to the final non-appealable decision of a
court of competent jurisdiction or Mezzanine Lender has waived its right to
appeal in writing) by reason of (i) ownership or holding of this Agreement, the
other Mezzanine Loan Documents, the Property or any of them or any interest
therein or any other Collateral, including any funds deposited with Mezzanine
Lender, (ii) receipt and application of any Receipts or an Indemnified Party's
payment or non-payment of costs and expenses of operating the Property, (iii)
any accident, injury to or death of Persons or loss of or damage to property
occurring on or about the Property or any part thereof or on the adjoining
sidewalks, curbs, adjacent property or adjacent parking areas, streets or ways,
(iv) any design, construction, alteration, operation, maintenance, use, nonuse
or condition of the Property or any part thereof or on adjoining sidewalks,
curbs, adjacent property or adjacent parking areas, streets or ways, (v) any
failure on the part of Mezzanine Borrower or any of its Affiliates, including
First Mortgage Loan Borrower, to perform or comply with any of the terms of this
Agreement or any other Mezzanine Loan Document, (vi) performance of any labor or
services or the furnishing of any materials or other property in respect of the
Property or any part thereof, (vii) any failure of the Property to comply with
any Legal Requirements, (viii) the presence in, at or under the Property of any
Hazardous Substances, or any release or discharge on or from the Property of any
Hazardous Substances, or any release or discharge on or from the Property of any
Hazardous Substances, (ix) any representation or warranty made in the Mezzanine
Note, this Agreement or any of the other Mezzanine Loan Documents being false or
misleading in any material respect as of the date such representation or
warranty was made, (x) except to the extent any such claims are made solely as a
result of any dealings between Mezzanine Lender and any broker, finder or
similar person claiming to be entitled to a commission in connection with the
Mezzanine Loan, and with whom Mezzanine Borrower has had no dealings in
connection with the Mezzanine Loan, any claim by brokers, finders or similar
Persons claiming to be entitled to a commission in connection with any Lease or
other action involving the Property or any part thereof, (xi) the claims of any
Tenant of any portion of the Property or any person acting through or out of any
Tenant or otherwise arising out of or as a consequence of any Lease or occupancy
right, (xii) any claim by



                                       84
<PAGE>   88

Mezzanine Borrower or any Affiliate of Mezzanine Borrower that the relationship
of Mezzanine Lender and Mezzanine Borrower is other than that of lender and
borrower, or (xiii) the execution and delivery of this Agreement and the other
Mezzanine Loan Documents, the transactions contemplated hereby or thereby and
the performance of the parties hereto of their respective obligations hereunder
or thereunder. Any amounts payable to any Indemnified Party by reason of the
application of this Section 8.29 shall become immediately due and payable and
shall bear interest at the Default Rate from the date Mezzanine Borrower is
notified of such loss or damage is sustained by any Indemnified Party until
paid. The indemnifications set forth in this Section 8.29 shall not be
applicable to the extent (1) occasioned, arising and caused solely as the result
of the negligence or willful misconduct of Mezzanine Lender, its nominee or
wholly owned subsidiary or their respective employees or agents and irrespective
of whether occurring prior to or subsequent to the date upon which Mezzanine
Lender, its nominee or wholly owned subsidiary acquires possession of any
interest in the Property by foreclosure, a sale of the Collateral, or any of
them, acceptance of a deed or assignment in lieu of foreclosure or sale or
otherwise, as determined to have occurred pursuant to the final non-appealable
decision of a court of competent jurisdiction (or Mezzanine Lender has waived in
writing its right to appeal) or (2) as to matters specific and relating solely
to the Property, occasioned, arising and caused solely as the result of any act
of any Person (other than an act of Mezzanine Borrower or any of its Affiliates,
or an act of any Governmental Authority, including, without limitation, any
change in any applicable law) and occurring subsequent to the earlier to occur
of (A) the date of payment and performance in full of the Debt and (B) the date
upon which Mezzanine Lender, its nominee or wholly owned subsidiary acquires
ownership of the Collateral by foreclosure, a sale of the Collateral, acceptance
of a deed or assignment in lieu of foreclosure or sale or otherwise of the
Collateral. The obligations and liabilities of Mezzanine Borrower under this
Section 8.29 shall survive any termination, satisfaction, or assignment of this
Agreement and the exercise by Mezzanine Lender of any of its rights or remedies
hereunder, including, without limitation, the acquisition of the Collateral by
foreclosure or a conveyance in lieu of foreclosure, or otherwise.

                  (b) In case any claim, action or proceeding (a "Claim") is
brought against any Indemnified Party in respect of which indemnification may be
sought by such Indemnified party pursuant to this Section 8.29, such Indemnified
Party shall give notice thereof to Mezzanine Borrower; provided, however, that
the failure of such Indemnified Party to so notify Mezzanine Borrower shall not
limit or affect such Indemnified Party's rights to be indemnified pursuant to
this Section 8.29 hereof, except to the extent such delay shall materially and
adversely affect Mezzanine Borrower's defense of such Claim. Upon receipt of
such notice of Claim, Mezzanine Borrower shall, at its sole cost and expense,
diligently defend any such Claim with counsel reasonably satisfactory to such
Indemnified Party. In the alternative, the Indemnified Parties may elect to
conduct their own defense through counsel of their own choosing, and at the
expense of Mezzanine Borrower, if (i) the Indemnified Parties reasonably
determine that the conduct of its defense by Mezzanine Borrower presents a
conflict or potential conflict between Mezzanine Borrower and an Indemnified
Party that would make separate representation advisable or otherwise could be
prejudicial to its interests, (ii) Mezzanine Borrower refuses to defend or (iii)
Mezzanine Borrower shall have failed, in Mezzanine Lender's reasonable judgment,
to diligently defend the Claim. Mezzanine Borrower may settle any Claim against
Indemnified Parties without such Indemnified Parties' consent, provided that (x)
such settlement is without any liability, cost or expense whatsoever to such
Indemnified Parties, (y) the settlement does not include or require any
admission of liability or culpability by such



                                       85
<PAGE>   89

Indemnified Parties under any Legal Requirement, whether criminal or civil in
nature, and (z) Mezzanine Borrower obtains an effective written release of
liability for such Indemnified Parties from the party to the Claim with whom
such settlement is being made, which release must be reasonably acceptable to
such Indemnified Parties, and a dismissal with prejudice with respect to all
Claims made by the party with whom such settlement is being made, with respect
to any pending legal action against such Indemnified Parties in connection with
such Claim. If the Indemnified Parties are conducting their own defense as
provided above, Mezzanine Borrower shall be responsible for any good faith
settlement of such Claim entered into by such Indemnified Parties, and such
Indemnified Parties shall not be required to obtain Mezzanine Borrower's consent
to any such settlement. Nothing contained herein shall be construed as requiring
any Indemnified Parties to expend funds or incur costs to defend any Claim in
connection with the matters for which such Indemnified Parties are entitled to
indemnification pursuant to this Section 8.29 hereof.

                  Section 8.30. Mezzanine Borrower Acknowledgments. Mezzanine
Borrower hereby acknowledges to and agrees with Mezzanine Lender that (i) the
scope of Mezzanine Lender's business is wide and includes, but is not limited
to, financing, real estate financing, investment in real estate and other real
estate transactions which may be viewed as adverse to or competitive with the
business of Mezzanine Borrower or its Affiliates and (ii) Mezzanine Borrower has
been represented by competent legal counsel and Mezzanine Borrower has consulted
with such counsel prior to executing this Mezzanine Loan Agreement and of the
other Mezzanine Loan Documents.

                  Section 8.31. Publicity. Mezzanine Lender and Mezzanine
Borrower shall have the right to issue press releases, advertisements and other
promotional materials describing the origination of the Mezzanine Loan mutually
acceptable to the Parties.

                  Section 8.32. Cross Collateralization. Without limitation to
any other right or remedy provided to Mezzanine Lender in this Agreement or any
of the other Mezzanine Loan Documents, Mezzanine Borrower acknowledges and
agrees that, to the full extent permitted under applicable law, upon the
occurrence of an Event of Default (i) Mezzanine Leader shall have the right to
pursue all of its rights and remedies in one proceeding, or separately and
independently in separate proceedings which it, as Mezzanine Lender, in its sole
and absolute discretion, shall determine from time to time, (ii) Mezzanine
Lender is not required to either marshall assets, sell Collateral in any inverse
order of alienation, or be subjected to any "one action" or "election of
remedies" law or rule, (iii) the exercise by Mezzanine Lender of any remedies
against any Collateral will not impede Mezzanine Lender from subsequently or
simultaneously exercising remedies against any other Collateral, (iv) all Liens
and other rights, remedies and privileges provided to Mezzanine Lender in this
Agreement and in the other Mezzanine Loan Documents or otherwise shall remain in
full force and effect until Mezzanine Lender has exhausted all of its remedies
against the Collateral and all Collateral has been foreclosed, sold and/or
otherwise realized upon and (v) all Collateral shall be security for the
performance of all of Mezzanine Borrower's obligations hereunder.

                  Section 8.33. Release. Upon full payment and satisfaction of
all of the obligations under the Mezzanine Loan Documents, Mezzanine Lender
shall execute such



                                       86
<PAGE>   90

releases and reconveyances as are customary to release and reconvey the
Collateral which secures the Mezzanine Loan.

                  Section 8.34. Assignment by Mezzanine Lender; Participations;
Securitization.

                  8.34.1 Assignments and Participations. (a) Mezzanine Borrower
acknowledges that any Mezzanine Lender may, at its sole cost and expense, on or
after the Closing Date sell and assign participation interests in and to the
Mezzanine Loan, or pledge, hypothecate or encumber, or sell and assign all or
any portion of the Mezzanine Loan, to or with such domestic or foreign banks,
insurance companies, pension funds, trusts or other institutional lenders or
other Persons, parties or investors (including, without limitation, grantor
trusts, owner trusts, special purpose corporations, REMICs, FASITs, real estate
investment trusts or other similar or comparable investment vehicles) as may be
selected by such Mezzanine Lender in its sole and absolute discretion and on
terms and conditions satisfactory to such Mezzanine Lender in its sole and
absolute discretion. Mezzanine Borrower and all other Persons associated or
connected with the Mezzanine Loan or the Property shall cooperate in all
reasonable respects (at such Mezzanine Lender's cost and expense) with such
Mezzanine Lender in connection with the sale of participation interests in, or
the pledge, hypothecation or encumbrance or sale of all or any portion of, the
Mezzanine Loan, and shall, in connection therewith, execute and deliver such
estoppels, certificates, instruments and documents as may be reasonably
requested by such Mezzanine Lender. Mezzanine Borrower grants to such Mezzanine
Lender the right to distribute financial and other information concerning
Mezzanine Borrower, the Collateral, and all other pertinent information with
respect to the Mezzanine Loan to any Person who has purchased a participation
interest in the Mezzanine Loan, or who has purchased the Mezzanine Loan (or any
interest therein or portion thereof), or who has made a loan to any Mezzanine
Lender secured by the Mezzanine Loan or who has expressed an interest in
purchasing a participation interest in the Mezzanine Loan, or expressed an
interest in purchasing the Mezzanine Loan (or any interest therein or portion
thereof), or the making of a loan to any Mezzanine Lender secured by the
Mezzanine Loan. If requested by any Mezzanine Lender, Mezzanine Borrower shall
execute and deliver, and shall cause each other Person associated or connected
with the Mezzanine Loan or the Property to execute and deliver, at the sole cost
of such Mezzanine Lender, such documents and instruments as may be necessary to
split the Mezzanine Loan into two or more loans evidenced by separate sets of
notes and secured by separate sets of other related Mezzanine Loan Documents to
the full extent required by any Mezzanine Lender to facilitate the sale of
participation interests in the Mezzanine Loan or the sale of the Mezzanine Loan
(or any interest therein or portion thereof) or the making of a loan to such
Mezzanine Lender secured by the Mezzanine Loan, it being agreed that (i) any
such splitting of the Mezzanine Loan will not adversely affect or diminish the
rights of Mezzanine Borrower as presently set forth herein and in the other
Mezzanine Loan Documents and will not increase the respective obligations and
liabilities of Mezzanine Borrower or any other Person associated or connected
with the Mezzanine Loan or the Collateral, (ii) the Mezzanine Loan Documents
securing the Mezzanine Loan as so split will have such priority of lien as may
be specified by the applicable Mezzanine Lender(s), and (iii) the retained
interest of Mezzanine Lender in the Mezzanine Loan as so split shall be
allocated to or among one or more of such separate loans in a manner specified
by the applicable Mezzanine Lender(s) in their sole and absolute discretion.



                                       87
<PAGE>   91

                  (b) Following any assignment pursuant to this Section 8.34,
the Agent, acting for this purpose as an agent of Mezzanine Borrower, shall
maintain or cause to be maintained a copy of each Assignment and Acceptance
delivered to it and a register for the recordation of the names and addresses of
the Mezzanine Lenders, and the principal amount of the Mezzanine Loan owing to,
each Mezzanine Lender pursuant to the terms hereof from time to time (the
"Register"). The entries in the Register shall be conclusive, and Mezzanine
Borrower and the Agent may treat each Person or entity whose name is recorded in
the Register pursuant to the terms hereof as a "Mezzanine Lender" hereunder for
all purposes of this Agreement, notwithstanding notice to the contrary. The
Agent shall cause copies of the Register to be delivered to, or available for
inspection by, Mezzanine Borrower and any Mezzanine Lender, at any reasonable
time and from time to time upon reasonable prior notice.

                  (c) Upon its receipt of a duly completed Assignment and
Acceptance executed by an assigning Mezzanine Lender and an Assignee, or a
participation agreement executed by the parties thereto, the Agent shall accept
such Assignment and Acceptance or participation agreement, as the case may be,
and record, or cause to be recorded, in the Register, the information contained
therein. No assignment or participation shall be effective for purposes of this
Agreement, unless it has been recorded in the Register as provided in this
Section. A Mezzanine Note shall only evidence a Mezzanine Lender's or Assignee's
right, title and interest in and to the Mezzanine Loan, and in no event shall
any Mezzanine Note be considered a bearer instrument or obligation. This Section
8.34.1 shall be construed so that the Mezzanine Loan is at all times maintained
in "registered form" within the meaning of Sections 163(f), 871(h)(2) and
881(c)(2) of the Internal Revenue Code and any related regulations (or any
successor provisions of the Internal Revenue Code or such regulations).
Furthermore, it is the intent of the parties hereto that all payments by
Mezzanine Borrower hereunder shall be exempt from withholding under Sections
1441 and 1442 of the Internal Revenue Code.

                  8.34.2 Effect of Assignment. From and after the effective date
of any assignment of all or any portion of the Mezzanine Loan to any Person (an
"Assignee") (a) such Assignee shall be a party hereto and to each of the other
Mezzanine Loan Documents to the extent of the applicable percentage or
percentages assigned to such Assignee and, except as otherwise specified herein,
shall succeed to the rights and obligations of Mezzanine Lender hereunder in
respect of such applicable percentage or percentages and (b) Mezzanine Lender
shall relinquish its rights and be released from its obligations hereunder and
under the Mezzanine Loan Documents to the extent of such applicable percentage
or percentages as assigned. The liabilities of Mezzanine Lender and each of the
other Assignees shall be separate and not joint and several. Neither Mezzanine
Lender nor any Assignee shall be responsible for the obligations of any other
Assignee.

                  8.34.3 Securitization. Mezzanine Lender, at its option, may
elect to effect a securitization, syndication or other Secondary Market
Transaction (including, without limitation, participation in a Delaware business
trust) of the Mezzanine Loan by means of a public or private offering and
issuance of certificates of interest therein or notes secured thereby (the
"Securities") which at the election of the Mezzanine Lender may be rated by one
or more Rating Agencies (the "Securitization"). In such event and upon request
by Mezzanine Lender to seek to effect such a Securitization, Mezzanine Borrower
shall promptly thereafter cooperate in all reasonable respects with Mezzanine
Lender in the Securitization including, without limitation,



                                       88
<PAGE>   92

(a) amending this Agreement and the other Mezzanine Loan Documents (without,
however, increasing the burdens and obligations of Mezzanine Borrower or
diminishing its rights hereunder), and executing such additional documents, in
order to bifurcate the Mezzanine Loan into two or more constituent loans or to
effect such other changes as may be reasonably necessary or desirable in
connection with a Securitization or requested by a Rating Agency, (b) providing
such information as may be requested in connection with the preparation of a
private placement memorandum or registration statement required to privately
place or publicly distribute the Securities in a manner which does not conflict
with federal or state securities laws, (c) providing in connection with such
information, an indemnification certificate (i) certifying that Mezzanine
Borrower has carefully examined such private placement memorandum or
registration statement, as applicable, including, without limitation, the
sections entitled "Special Considerations", "Description of the Mezzanine Loan
and the Underlying Mortgaged Properties", "Operator", "The Mezzanine Borrower"
and "Certain Legal Aspects of the Mezzanine Loan" (or similarly titled
sections), and that such Sections (and any other Sections reasonably requested),
insofar as they relate solely to Mezzanine Borrower, its Affiliates, the
Mezzanine Loan, the Collateral or the Property, do not contain any untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements made, in the light of the circumstances under which they
were made, not misleading, (ii) indemnifying Mezzanine Lender, the underwriter
or placement agent and any of their Affiliates for any losses, claims, damages
or liabilities (the "Liabilities") to which such parties may become subject
insofar as the Liabilities arise out of or are based upon any untrue statement
or alleged untrue statement of any material fact relating to Mezzanine Borrower,
its Affiliates, the Mezzanine Loan, the Collateral or the Property contained in
such Sections or arise out of or are based upon the omission or alleged omission
to state therein a material fact relating to Mezzanine Borrower, its Affiliates,
the Mezzanine Loan, the Collateral or the Property required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading and (iii) agreeing to
reimburse such parties for any legal or other expenses reasonably incurred by
such parties in connection with investigating or defending the Liabilities, (d)
causing to be rendered (at Mezzanine Lender's expense) such customary opinion
letters as may be requested by and satisfactory to any Rating Agency including,
without limitation, substantive non-consolidation opinion letters, (e) making
such customary representations, warranties and covenants with respect to the
Mezzanine Borrower and First Mortgage Loan Borrower and their respective
Affiliates, the Collateral and the Property as may be requested by any Rating
Agency, (f) providing such information regarding the Property, the Collateral
and Mezzanine Borrower and First Mortgage Loan Borrower and their respective
Affiliates as may be requested by a Rating Agency or potential investors in
Securities or otherwise required in connection with an election of REMIC or
FASIT or other tax status and ongoing administration and reporting by any trust
formed in connection with the Securitization, (g) amending the organizational
documents of Mezzanine Borrower or the Control Entity of Mezzanine Borrower or
making such other changes to the structure of Mezzanine Borrower or the Control
Entity of Mezzanine Borrower required by any Rating Agency to conform to
requirements customarily imposed in similar transactions, and (h) obtaining a
comfort letter (in customary form and containing customary exceptions) from a
nationally recognized accounting firm in connection with financial information
relating to Mezzanine Borrower and First Mortgage Loan Borrower, the Collateral
or the Property and which is, in connection with the Securitization, presented
in a private placement memorandum or prospectus. In no event shall Mezzanine
Borrower be



                                       89
<PAGE>   93

required to pay any Rating Agency or other out-of-pocket fees or expenses in
connection with any such Securitization other than the direct costs incurred by
Mezzanine Borrower is cooperating in the manner described in clauses (a) through
(b) above.

                  8.34.4 Other Business. Mezzanine Lender, each Assignee and
each participant and their respective Affiliates may accept deposits from, lend
money to, act as trustee under indentures of, and generally engage in any kind
of business with, Mezzanine Borrower, or any of them, any Affiliate of Mezzanine
Borrower, any of Mezzanine Borrower's subsidiaries and any Person who may do
business with or own interests in or securities of Mezzanine Borrower or any
such Affiliate or subsidiary, without any duty to account therefor.

                  8.34.5 Privity of Contract. This Agreement is being entered
into by Mezzanine Lender individually and as agent for all present and future
Assignees, and privity of contract is hereby created among Mezzanine Lender and
all present and future Assignees, on the one hand, and Mezzanine Borrower, on
the other hand.

                  Section 8.35. The Agent. Upon the initial occurrence of a
sale, assignment, pledge, grant, participation, syndication, securitization or
other similar transaction contemplated in Section 8.34, Mezzanine Lender shall
appoint one (1) representative (the "Agent") to act collectively on behalf of
all Person(s) having an interest in the Mezzanine Loan.



                        [NO ADDITIONAL TEXT ON THIS PAGE]







                                       90
<PAGE>   94

                  IN WITNESS WHEREOF, the parties hereto have caused this
Mezzanine Loan Agreement to be duly executed by their duly authorized
representatives, all as of the day and year first above written.


                                    MEZZANINE LENDER:

                                    MERRILL LYNCH MORTGAGE CAPITAL INC.,
                                    a Delaware corporation



                                    By:
                                        ----------------------------------------
                                        Name:  Steven M. Glassman
                                        Title: Vice President


                                    MEZZANINE BORROWER:

                                    OHN HOLDINGS, LLC
                                    a Delaware limited liability company



                                    By:
                                        ----------------------------------------
                                        Name:  J. Russell Worsham
                                        Title: Vice President


<PAGE>   95
                                    EXHIBIT A

                             ORGANIZATIONAL CHART OF
                          FIRST MORTGAGE LOAN BORROWER
                             AND MEZZANINE BORROWER


<PAGE>   96

                                    EXHIBIT C

                           APPROVED OPERATING BUDGET;

                              APPROVED FF&E BUDGET



<PAGE>   97
                                    EXHIBIT D

                             FORM OF MEZZANINE NOTE



<PAGE>   98
                                    EXHIBIT E

                        FORM OF ASSIGNMENT AND ACCEPTANCE

                  Reference is made to that certain Mezzanine Loan Agreement
dated as of _______, 2000 (as amended and in effect on the date hereof, the
"Mezzanine Loan Agreement"), between [MERRILL LYNCH MORTGAGE CAPITAL INC.,] as
lender, and [_______________________], as borrower. Terms defined in the
Mezzanine Loan Agreement are used herein with the same meanings.

                  The Assignor named herein hereby sells and assigns, without
recourse, to the Assignee named herein, and the Assignee hereby purchases and
assumes, without recourse, from the Assignor, effective as of the Assignment
Date set forth herein, the interests set forth herein (the "Assigned Interest")
in the Assignor's rights and obligations under the Mezzanine Loan Agreement, but
excluding accrued interest and fees to and excluding the Assignment Date. The
Assignee hereby acknowledges receipt of a copy of the Mezzanine Loan Agreement
and the other Mezzanine Loan Documents as of the date hereof. From and after the
Assignment Date (i) the Assignee shall be a party to and be bound by the
provisions of the Mezzanine Loan Agreement and, to the extent of the Assigned
Interest, have the rights and obligations of a Mezzanine Lender thereunder and
(ii) the Assignor shall, to the extent of the Assigned Interest, relinquish its
rights and be released from its obligations under the Mezzanine Loan Agreement.

                  This Assignment and Acceptance is being delivered to the
Lender together with an Administrative Questionnaire in the form supplied by the
Lender, duly completed by the Assignee.

                  This Assignment and Acceptance shall be governed by and
construed in accordance with the laws of the State of New York.

Date of Assignment:_____________________

Legal Name of Assignor:______________________________

Legal Name of Assignee:______________________________

Assignee's Address for Notices:


                  __________________________
                  __________________________
                  __________________________

Effective Date of Assignment
("Assignment Date"):__________________




<PAGE>   99

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------
Facility              Principal Amount Assigned    Percentage Assigned of Mezzanine
                                                   Loan (set forth, to at least 8
                                                   decimals, as a percentage of the
                                                   Mezzanine Loan)
--------------------------------------------------------------------------------------
<S>                   <C>                          <C>
Mezzanine Loan:       $                                                             %
--------------------------------------------------------------------------------------

--------------------------------------------------------------------------------------
</TABLE>

The terms set forth herein are hereby agreed to:


                                    [NAME OF ASSIGNOR], as Assignor



                                    By:
                                        ----------------------------------------
                                    Name:
                                    Title:


                                    [NAME OF ASSIGNEE], as Assignee



                                    By:
                                        ----------------------------------------
                                    Name:
                                    Title:

Receipt acknowledged:

[          [AGENT]             ]
 ------------------------------


By:
    ---------------------------
         Name:
         Title:

</TEXT>
</DOCUMENT>
