$500,000 Uses in Fees and Expenses; Closing Costs Clause

Fees and Expenses; Closing Costs from Contribution Agreement

THIS CONTRIBUTION AGREEMENT (this Agreement) is made as of the 23 day of August, 2004 (the Effective Date) by and among the entities identified on Schedule 1 attached hereto (each a Contributor and collectively, the Contributors), and MHI Hospitality LP, a Delaware limited partnership (Acquiror).

Fees and Expenses; Closing Costs. The Acquiror shall pay all fees, expenses and closing costs relating to the transactions contemplated by this Agreement; provided however, that each Contributor shall pay its own attorneys and consultants fees and expenses. In the event the Closing does not occur as a result of a failure to conclude an IPO, the Company agrees to pay to Acquiror 44.1% of the actual out-of-pocket costs incurred by Acquiror and its affiliates in connection with the proposed IPO of the REIT, which the Company agrees represents the pro rata share of the expected transaction costs of the Contributors; provided, however, that such payment shall not exceed $500,000. Each Contributor acknowledges and agrees, by executing this Agreement, that it will benefit from such an IPO and, as a consequence, the Company will bear a portion of its costs if such transaction is not completed.

Fees and Expenses; Closing Costs from Contribution Agreement

THIS CONTRIBUTION AGREEMENT (this Agreement) is made as of the 23 day of August, 2004 (the Effective Date) by and among the entities identified on Schedule 1 attached hereto (each a Contributor and collectively, the Contributors), and MHI Hospitality LP, a Delaware limited partnership (Acquiror).

Fees and Expenses; Closing Costs. The Acquiror shall pay all fees, expenses and closing costs relating to the transactions contemplated by this Agreement; provided however, that each Contributor shall pay its own attorneys and consultants fees and expenses. In the event the Closing does not occur as a result of a failure to conclude an IPO, the Company agrees to pay to Acquiror 44.1% of the actual out-of-pocket costs incurred by Acquiror and its affiliates in connection with the proposed IPO of the REIT, which the Company agrees represents the pro rata share of the expected transaction costs of the Contributors; provided, however, that such payment shall not exceed $500,000. Each Contributor acknowledges and agrees, by executing this Agreement, that it will benefit from such an IPO and, as a consequence, the Company will bear a portion of its costs if such transaction is not completed.

Fees and Expenses; Closing Costs from Contribution Agreement

THIS CONTRIBUTION AGREEMENT (this Agreement) is made as of the 23 day of August, 2004 (the Effective Date) by and among the entities identified on Schedule 1 attached hereto (each a Contributor and collectively, the Contributors), and MHI Hospitality LP, a Delaware limited partnership (Acquiror).

Fees and Expenses; Closing Costs. The Acquiror shall pay all fees, expenses and closing costs relating to the transactions contemplated by this Agreement; provided however, that each Contributor shall pay its own attorneys and consultants fees and expenses. In the event the Closing does not occur as a result of a failure to conclude an IPO, the Company agrees to pay to Acquiror 44.1% of the actual out-of-pocket costs incurred by Acquiror and its affiliates in connection with the proposed IPO of the REIT, which the Company agrees represents the pro rata share of the expected transaction costs of the Contributors; provided, however, that such payment shall not exceed $500,000. Each Contributor acknowledges and agrees, by executing this Agreement, that it will benefit from such an IPO and, as a consequence, the Company will bear a portion of its costs if such transaction is not completed.