Meristar Hospitality Finance Corp Ii 10-K 2004 FY Annual report

Exhibit 99.1

Report of Independent Registered Public Accounting Firm

The Partners

MeriStar Hospitality Operating Partnership, L.P.:

Under date of March 15, 2005, we reported on the consolidated balance sheets of MeriStar Hospitality Operating Partnership, L.P. and subsidiaries as of December 31, 2004 and 2003, and the related consolidated statements of operations, partners’ capital and cash flows for each of the years in the three-year period ended December 31, 2004, included in MeriStar Hospitality Operating Partnership, L.P.’s annual report on Form 10-K for the year 2004. Our audits were made for the purpose of forming an opinion on the consolidated financial statements of MeriStar Hospitality Operating Partnership, L.P. and subsidiaries taken as a whole. The consolidating information is presented for purposes of additional analysis of the consolidated financial statements rather than to present the financial position, results of operations and cash flows of the individual companies. The consolidating information has been subjected to the auditing procedures applied in the audits of the consolidated financial statements and, in our opinion, is fairly stated in all material respects in relation to the consolidated financial statements taken as a whole.

/s/    KPMG LLP

McLean, VA

March 15, 2005

Exhibit 99.1

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Balance Sheet

December 31, 2004

(Dollars in thousands)

	MeriStar Hospitality OP, L.P.			Non- Guarantor Subsidiaries		MeriStar Lexington Mortgage, LLC	MeriStar Lexington Partners, LLC	MeriStar Sub 7C, LLC	MeriStar Sub 8G, LLC	AGH Upreit LLC	MeriStar Sub 6H, L.P.		MeriStar Sub 8F, L.P.		MeriStar Sub 8B, LLC
Assets
Property and equipment	$	22,301		1,476,952		—	—	—	—	—	10,885		13,687		88,943
Accumulated depreciation		(14,642	)	(286,652	)	—	—	—	—	—	(783	)	(3,179	)	(14,741	)
		7,659		1,190,300		—	—	—	—	—	10,102		10,508		74,202
Restricted cash		55,754		1,346		—	—	—	—	—	—		—		—
Investment in affiliate		2,492,499		7,992		40,393	9,487	32	72	2,989	—		—		—
Due to/from subsidiaries		(1,106,110	)	522,427		709	750	—	9	73	7,830		6,748		31,376
Note receivable from subsidiaries		221,704		—		—	—	—	—	—	—		—		—
Insurance claim receivable		76,056		—		—	—	—	—	—	—		—		—
Prepaid expenses and other assets		31,287		(3,841	)	—	—	—	—	—	(11	)	(81	)	(101	)
Accounts receivable, net		9,596		1,054		740	—	—	—	—	—		—		—
Cash and cash equivalents		41,224		—		—	—	—	—	—	—		—		—
	$	1,829,669		1,719,278		41,842	10,237	32	81	3,062	17,921		17,175		105,477
Liabilities and Partners’ Capital
Long-term debt	$	841,976		471,781		—	—	—	—	—	—		—		—
Notes payable to MeriStar Hospitality Corporation		203,977		—		—	—	—	—	—	—		—		—
Accounts payable and accrued expenses		14,777		5,128		—	—	—	—	—	—		6		—
Accrued interest		38,683		2,214		—	—	—	—	—	—		—		—
Due to Interstate Hotels & Resorts		11,347		—		—	—	—	—	—	—		—		—
Other liabilities		5,382		—		—	—	—	—	—	—		—		—
		1,116,142		479,123		—	—	—	—	—	—		6		—
Minority interests		2,418		—		—	—	—	—	—	—		—		—
Redeemable OP units at redemption value		19,187		—		—	—	—	—	—	—		—		—
Partners’ capital - Common OP Units		691,922		1,240,155		41,842	10,237	32	81	3,062	17,921		17,169		105,477
	$	1,829,669		1,719,278		41,842	10,237	32	81	3,062	17,921		17,175		105,477

1

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Balance Sheet

December 31, 2004

(Dollars in thousands)

	MeriStar Sub 1C, LLC		MeriStar Sub 8E, LLC		MeriStar Sub 7F, LLC		MeriStar Sub 5L, LLC		MeriStar Sub 3C, LLC		MeriStar Sub 5R, LLC		MeriStar Sub 8A, LLC	MeriStar Sub 6D, LLC		MeriStar Sub 6E, LLC		MeriStar Sub 4E, L.P.
Assets
Property and equipment	27,485		16,028		10,034		11,800		17,581		—		—	18,367		49,971		—
Accumulated depreciation	(7,319	)	(3,618	)	(413	)	(723	)	(4,384	)	—		—	(3,377	)	(11,560	)	(1	)
	20,166		12,410		9,621		11,077		13,197		—		—	14,990		38,411		(1	)
Restricted cash	—		—		—		—		—		—		—	—		—		—
Investment in affiliate	—		—		—		—		—		43		—	—		—		—
Due to/from subsidiaries	(4,175	)	7,517		3,135		5,022		6,581		(43	)	—	9,328		22,758		7,015
Note receivable from subsidiaries	—		—		—		—		—		—		—	—		—		—
Insurance claim receivable	—		—		—		—		—		—		—	—		—		—
Prepaid expenses and other assets	(190	)	(26	)	(12	)	(77	)	2		—		—	(21	)	(93	)	—
Accounts receivable, net	—		—		—		—		—		—		—	124		—		64
Cash and cash equivalents	—		—		—		—		—		—		—	—		—		—
	15,801		19,901		12,744		16,022		19,780		—		—	24,421		61,076		7,078
Liabilities and Partners’ Capital
Long-term debt	—		—		—		—		—		—		—	—		—		—
Notes payable to MeriStar Hospitality Corporation	—		—		—		—		—		—		—	—		—		—
Accounts payable and accrued expenses	59		—		153		1		211		—		—	(21	)	(20	)	5
Accrued interest	—		—		—		—		—		—		—	—		—		—
Due to Interstate Hotels & Resorts	—		—		—		—		—		—		—	—		—		—
Other liabilities	—		—		—		—		—		—		—	—		—		—
	59		—		153		1		211		—		—	(21	)	(20	)	5
Minority interests	—		—		—		—		—		—		—	—		—		—
Redeemable OP units at redemption value	—		—		—		—		—		—		—	—		—		—
Partners’ capital - Common OP Units	15,742	��	19,901		12,591		16,021		19,569		—		—	24,442		61,096		7,073
	15,801		19,901		12,744		16,022		19,780		—		—	24,421		61,076		7,078

2

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Balance Sheet

December 31, 2004

(Dollars in thousands)

	MeriStar Sub 1B, LLC		MeriStar Sub 5F, L.P.		MeriStar Sub 6G, LLC		MeriStar Sub 8C, LLC	MeriStar Sub 4C, L.P.	MeriStar Sub 4H, L.P.	MeriStar Sub 7E, LLC		MeriStar Sub 3D, LLC		MeriStar Sub 1A, LLC		MeriStar Sub 7A Joint Venture
Assets
Property and equipment	20,404		18,560		24,167		—	—	1	20,118		22,986		5,500		—
Accumulated depreciation	(4,557	)	(591	)	(5,738	)	—	—	—	(3,974	)	(7,740	)	(2	)	—
	15,847		17,969		18,429		—	—	1	16,144		15,246		5,498		—
Restricted cash	—		—		—		—	—	—	—		—		—		—
Investment in affiliate	—		—		—		—	—	—	—		—		—		—
Due to/from subsidiaries	15,571		12,510		8,688		11,439	—	3,413	6,024		9,411		8,518		9,944
Note receivable from subsidiaries	—		—		—		—	—	—	—		—		—		—
Insurance claim receivable	—		—		—		—	—	—	—		—		—		—
Prepaid expenses and other assets	(83	)	(178	)	(35	)	—	—	—	(22	)	(43	)	(96	)	—
Accounts receivable, net	96		—		—		—	—	—	—		—		—		(44	)
Cash and cash equivalents	—		—		—		—	—	—	—		—		—		—
	31,431		30,301		27,082		11,439	—	3,414	22,146		24,614		13,920		9,900
Liabilities and Partners’ Capital
Long-term debt	33		—		—		—	—	—	—		—		—		—
Notes payable to MeriStar Hospitality Corporation	—		—		—		—	—	—	—		—		—		—
Accounts payable and accrued expenses	(7	)	(4	)	61		—	—	—	88		—		2		—
Accrued interest	—		—		—		—	—	—	—		—		—		—
Due to Interstate Hotels & Resorts	—		—		—		—	—	—	—		—		—		—
Other liabilities	—		—		—		—	—	—	—		—		—		—
	26		(4	)	61		—	—	—	88		—		2		—
Minority interests	—		—		—		—	—	—	—		—		—		—
Redeemable OP units at redemption value	—		—		—		—	—	—	—		—		—		—
Partners’ capital - Common OP Units	31,405		30,305		27,021		11,439	—	3,414	22,058		24,614		13,918		9,900
	31,431		30,301		27,082		11,439	—	3,414	22,146		24,614		13,920		9,900

3

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Balance Sheet

December 31, 2004

(Dollars in thousands)

	MeriStar Sub 2B, LLC	MeriStar Sub 3A, LLC	MeriStar Sub 4A, LP	MeriStar Sub 4D, LLC	MeriStar Sub 2A, LLC	MeriStar Sub 6L, LLC	MDV Limited Partnership		MeriStar Sub 5C, LLC	MeriStar Sub 6J, LLC		MeriStar Sub 1D, LLC
Assets
Property and equipment	—	—	—	—	—	—	3,955		—	19,976		69,500
Accumulated depreciation	—	—	—	—	—	—	(840	)	—	(4,320	)	(14,321	)
	—	—	—	—	—	—	3,115		—	15,656		55,179
Restricted cash	—	—	—	—	—	—	—		—	—		—
Investment in affiliate	—	—	—	—	—	—	—		—	—		—
Due to/from subsidiaries	—	4,976	7,612	—	—	20,297	2,879		—	9,835		22,849
Note receivable from subsidiaries	—	—	—	—	—	—	—		—	—		—
Insurance claim receivable	—	—	—	—	—	—	—		—	—		—
Prepaid expenses and other assets	—	—	—	—	—	—	(24	)	—	(6	)	(550	)
Accounts receivable, net	—	—	—	—	—	178	—		—	—		—
Cash and cash equivalents	—	—	—	—	��	—	—		—	—		—
	—	4,976	7,612	—	—	20,475	5,970		—	25,485		77,478
Liabilities and Partners’ Capital
Long-term debt	—	—	—	—	—	—	—		—	—		—
Notes payable to MeriStar Hospitality Corporation	—	—	—	—	—	—	—		—	—		—
Accounts payable and accrued expenses	—	—	—	—	—	—	75		—	59		—
Accrued interest	—	—	—	—	—	—	—		—	—		—
Due to Interstate Hotels & Resorts	—	—	—	—	—	—	—		—	—		—
Other liabilities	—	—	—	—	—	—	—		—	—		—
	—	—	—	—	—	—	75		—	59		—
Minority interests	—	—	—	—	—	—	—		—	—		—
Redeemable OP units at redemption value	—	—	—	—	—	—	—		—	—		—
Partners’ capital - Common OP Units	—	4,976	7,612	—	—	20,475	5,895		—	25,426		77,478
	—	4,976	7,612	—	—	20,475	5,970		—	25,485		77,478

4

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Balance Sheet

December 31, 2004

(Dollars in thousands)

	MeriStar Sub 7B, L.P.		MeriStar Sub 7D, LLC		MeriStar Sub 7G, LLC	MeriStar Sub 6B, LLC		MeriStar Sub 4I, L.P.	MeriStar Sub 5D, LLC		MeriStar Sub 5H, LLC	MeriStar Sub 7H, LLC	AGH PSS I, Inc.	MeriStar Sub 2D, LLC
Assets
Property and equipment	—		55,081		—	11,877		—	42,467		—	—	—	—
Accumulated depreciation	—		(11,258	)	—	(2,636	)	—	(9,533	)	—	—	—	—
	—		43,823		—	9,241		—	32,934		—	—	—	—
Restricted cash	—		—		—	—		—	—		—	—	—	—
Investment in affiliate	—		—		—	—		—	51,368		—	—	—	—
Due to/from subsidiaries	(262	)	26,640		2,370	2,976		—	(6,151	)	—	—	—	—
Note receivable from subsidiaries	—		—		—	—		—	—		—	—	—	—
Insurance claim receivable	—		—		—	—		—	—		—	—	—	—
Prepaid expenses and other assets	—		46		—	(14	)	—	(77	)	—	—	—	—
Accounts receivable, net	—		1,169		—	—		—	—		—	—	—	—
Cash and cash equivalents	—		—		—	—		—	—		—	—	—	—
	(262	)	71,678		2,370	12,203		—	78,074		—	—	—	—
Liabilities and Partners’ Capital
Long-term debt	—		—		—	—		—	24,000		—	—	—	—
Notes payable to MeriStar Hospitality Corporation	—		—		—	—		—	—		—	—	—	—
Accounts payable and accrued expenses	—		2,381		—	(125	)	—	165		—	—	—	—
Accrued interest	—		—		—	—		—	—		—	—	—	—
Due to Interstate Hotels & Resorts	—		(200	)	—	—		—	—		—	—	—	—
Other liabilities	—		—		—	—		—	—		—	—	—	—
	—		2,181		—	(125	)	—	24,165		—	—	—	—
Minority interests	—		—		—	—		—	—		—	—	—	—
Redeemable OP units at redemption value	—		—		—	—		—	—		—	—	—	—
Partners’ capital - Common OP Units	(262	)	69,497		2,370	12,328		—	53,909		—	—	—	—
	(262	)	71,678		2,370	12,203		—	78,074		—	—	—	—

5

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Balance Sheet

December 31, 2004

(Dollars in thousands)

	MeriStar Sub 4F, L.P.		MeriStar Sub 5K, LLC	MeriStar Sub 5M, LLC		MeriStar Sub 1E, LLC	MeriStar Sub 5O, LLC		MeriStar Sub 4B, L.P.	MeriStar Sub 2C, LLC		MeriStar Sub 4G, L.P.		MeriStar Sub 3B, LLC	MeriStar Sub 5G, L.P.
Assets
Property and equipment	35,341		—	18,969		—	7,263		—	—		—		—	168,827
Accumulated depreciation	(6,923	)	—	(1,607	)	—	(844	)	—	—		(1	)	—	(35,721	)
	28,418		—	17,362		—	6,419		—	—		(1	)	—	133,106
Restricted cash	—		—	—		—	—		—	—		—		—	—
Investment in affiliate	—		—	—		—	—		—	—		—		—	—
Due to/from subsidiaries	4,108		21,531	10,741		—	4,524		1,728	(2,360	)	16,930		—	45,208
Note receivable from subsidiaries	—		—	—		—	—		—	—		—		—	—
Insurance claim receivable	—		—	—		—	—		—	—		—		—	—
Prepaid expenses and other assets	(10	)	—	(118	)	—	(39	)	—	—		—		—	(394	)
Accounts receivable, net	—		—	—		—	—		—	—		—		—	—
Cash and cash equivalents	—		—	—		—	—		—	—		—		—	—
	32,516		21,531	27,985		—	10,904		1,728	(2,360	)	16,929		—	177,920
Liabilities and Partners’ Capital
Long-term debt	—		—	—		—	—		—	—		—		—	—
Notes payable to MeriStar Hospitality Corporation	—		—	—		—	—		—	—		—		—	—
Accounts payable and accrued expenses	334		—	—		—	—		—	—		—		—	—
Accrued interest	—		—	—		—	—		—	—		—		—	—
Due to Interstate Hotels & Resorts	—		—	—		—	—		—	—		—		—	—
Other liabilities	—		—	—		—	—		—	—		—		—	—
	334		—	—		—	—		—	—		—		—	—
Minority interests	—		—	—		—	—		—	—		—		—	—
Redeemable OP units at redemption value	—		—	—		—	—		—	—		—		—	—
Partners’ capital - Common OP Units	32,182		21,531	27,985		—	10,904		1,728	(2,360	)	16,929		—	177,920
	32,516		21,531	27,985		—	10,904		1,728	(2,360	)	16,929		—	177,920

6

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Balance Sheet

December 31, 2004

(Dollars in thousands)

	MeriStar Sub 5N, LLC		MeriStar Sub 5P, LLC		MeriStar Sub 5J, LLC		MeriStar Sub 5Q, LLC		MeriStar Sub 5A, LLC		MeriStar Sub 8D, LLC	MeriStar Sub 4J, LLC		Meristar Pentagon City, LLC		MeriStar Sub 6K, LLC	MeriStar Sub 5E, LLC
Assets
Property and equipment	3,580		39		79,579		13,980		37,074		—	41,862		93,264		—	—
Accumulated depreciation	(448	)	(28	)	(14,819	)	(2,312	)	(11,767	)	—	(8,398	)	(3,478	)	—	—
	3,132		11		64,760		11,668		25,307		—	33,464		89,786		—	—
Restricted cash	—		—		—		—		—		—	—		—		—	—
Investment in affiliate	—		—		—		—		4,627		—	—		—		—	—
Due to/from subsidiaries	4,988		3,724		51,127		8,187		8,010		16,379	6,370		58,867		—	—
Note receivable from subsidiaries	—		—		—		—		—		—	—		—		—	—
Insurance claim receivable	—		—		—		—		—		—	—		—		—	—
Prepaid expenses and other assets	(45	)	(10	)	(769	)	(137	)	(78	)	—	(51	)	466		—	—
Accounts receivable, net	—		38		—		—		—		359	(14	)	(361	)	—	—
Cash and cash equivalents	—		—		—		—		—		—	—		—		—	—
	8,075		3,763		115,118		19,718		37,866		16,738	39,769		148,758		—	—
Liabilities and Partners’ Capital
Long-term debt	—		—		—		—		23,609		—	—		55,509		—	—
Notes payable to MeriStar Hospitality Corporation	—		—		—		—		—		—	—		—		—	—
Accounts payable and accrued expenses	4		—		126		(18	)	114		—	152		273		—	—
Accrued interest	—		—		—		—		—		—	—		268		—	—
Due to Interstate Hotels & Resorts	—		—		—		—		—		—	—		—		—	—
Other liabilities	—		—		—		—		—		—	—		—		—	—
	4		—		126		(18	)	23,723		—	152		56,050		—	—
Minority interests	—		—		—		—		—		—	—		—		—	—
Redeemable OP units at redemption value	—		—		—		—		—		—	—		—		—	—
Partners’ capital - Common OP Units	8,071		3,763		114,992		19,736		14,143		16,738	39,617		92,708		—	—
	8,075		3,763		115,118		19,718		37,866		16,738	39,769		148,758		—	—

7

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Balance Sheet

December 31, 2004

(Dollars in thousands)

	MeriStar Sub 6I, LLC	MeriStar Sub 5I, LLC	CapStar Cherry Hill Company, LLC	Meristar Acquisition Company, LLC	MeriStar Sub 6A, LLC	MeriStar Sub 6F, LLC	MeriStar Hotel Lessee, Inc.		Guarantor Eliminations		Guarantor Subsidiaries Total		Consolidation Eliminations		Total Consolidated
Assets
Property and equipment	—	—	—	—	—	—	3,316		—		1,082,467		—		$	2,581,720
Accumulated depreciation	—	—	—	—	—	—	(3,384	)	—		(205,338	)	—			(506,632	)
	—	—	—	—	—	—	(68	)	—		877,129		—			2,075,088
Restricted cash	—	—	—	—	—	—	1,313		—		1,313		—			58,413
Investment in affiliate	—	—	—	—	—	—	42,022		(40,393	)	110,640		(2,526,603	)		84,528
Due to/from subsidiaries	—	—	—	—	—	—	40,158		(709	)	583,683		—			—
Note receivable from subsidiaries	—	—	—	—	—	—	—		—		—		(221,704	)		—
Insurance claim receivable	—	—	—	—	—	—	—		—		—		—			76,056
Prepaid expenses and other assets	—	—	—	—	—	—	9,661		—		6,784		—			34,230
Accounts receivable, net	—	—	—	—	—	—	30,874		(740	)	32,483		(9,414	)		33,719
Cash and cash equivalents	—	—	—	—	—	—	19,309		—		19,309		—			60,533
	—	—	—	—	—	—	143,269		(41,842	)	1,631,341		(2,757,721	)	$	2,422,567
Liabilities and Partners’ Capital
Long-term debt	—	—	—	—	—	—	174,095		—		277,246		(221,704	)	$	1,369,299
Notes payable to MeriStar Hospitality Corporation	—	—	—	—	—	—	—		—		—		—			203,977
Accounts payable and accrued expenses	—	—	—	—	—	—	48,274		—		52,348		—			72,253
Accrued interest	—	—	—	—	—	—	9,414		—		9,682		(9,414	)		41,165
Due to Interstate Hotels & Resorts	—	—	—	—	—	—	10,652		—		10,452		—			21,799
Other liabilities	—	—	—	—	—	—	6,171		—		6,171		—			11,553
	—	—	—	—	—	—	248,606		—		355,899		(231,118	)		1,720,046
Minority interests	—	—	—	—	—	—	—		—		—		—			2,418
Redeemable OP units at redemption value	—	—	—	—	—	—	—		—		—		—			19,187
Partners’ capital - Common OP Units	—	—	—	—	—	—	(105,337	)	(41,842	)	1,275,442		(2,526,603	)		680,916
	—	—	—	—	—	—	143,269		(41,842	)	1,631,341		(2,757,721	)	$	2,422,567

8

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Balance Sheet

December 31, 2003

(Dollars in thousands)

	MeriStar Hospitality OP, L.P.			Non- Guarantor Subsidiaries		MeriStar Sub 7C, LLC	MeriStar Sub 8G, LLC	AGH Upreit LLC	MeriStar Sub 6H, L.P.		MeriStar Sub 8F, L.P.		MeriStar Sub 8B, LLC		MeriStar Sub 1C, L.P.		MeriStar Sub 8E, LLC
Assets
Property and equipment	$	18,987		1,407,432		—	—	—	10,862		11,502		83,215		26,641		15,493
Accumulated depreciation		(13,219	)	(246,091	)	—	—	—	(157	)	(2,521	)	(12,270	)	(5,900	)	(3,024	)
		5,768		1,161,341		—	—	—	10,705		8,981		70,945		20,741		12,469
Assets held for sale		—		4,273		—	—	—	—		—		—		—		—
Restricted cash		39,932		2,476		—	—	—	—		115		—		—		—
Investments in affiliate		2,208,641		8,200		32	72	2,989	—		—		—		—		—
Due from/to subsidiaries		(838,258	)	397,837		—	10	133	6,814		7,012		30,981		(3,881	)	6,688
Note receivable from subsidiaries		120,855		—		—	—	—	—		—		—		—		—
Prepaid expenses and other assets		34,658		(1,612	)	—	—	—	1		(28	)	(26	)	(88	)	(10	)
Accounts receivable, net		18,220		956		—	—	—	—		—		—		—		—
Cash and cash equivalents		218,646		—		—	—	—	—		—		—		—		—
	$	1,808,462		1,573,471		32	82	3,122	17,520		16,080		101,900		16,772		19,147
Liabilities and Partners’ Capital
Long-term debt	$	917,232		436,778		—	—	—	—		—		—		—		—
Notes payable to MeriStar Hospitality Corporation		256,473		—		—	—	—	—		—		—		—		—
Accounts payable and accrued expenses		14,806		5,517		—	—	—	161		67		2,502		88		(32	)
Accrued interest		43,396		2,639		—	—	—	—		—		—		—		—
Due to Interstate Hotels & Resorts		6,923		—		—	—	—	—		—		—		—		—
Other liabilities		1,750		(304	)	—	—	—	—		—		—		—		—
Total liabilities		1,240,580		444,630		—	—	—	161		67		2,502		88		(32	)
Minority interests		2,496		—		—	—	—	—		—		—		—		—
Redeemable OP units at redemption value		35,926		—		—	—	—	—		—		—		—		—
Partners’ capital - Common OP Units		529,460		1,128,841		32	82	3,122	17,359		16,013		99,398		16,684		19,179
	$	1,808,462		1,573,471		32	82	3,122	17,520		16,080		101,900		16,772		19,147

9

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Balance Sheet

December 31, 2003

(Dollars in thousands)

	MeriStar Sub 7F, LLC		MeriStar Sub 5L, LLC		MeriStar Sub 3C, LLC		MeriStar Sub 5R, LLC		MeriStar Sub 8A, LLC	MeriStar Sub 6D, LLC		MeriStar Sub 6E, LLC		MeriStar Sub 4E, L.P.		MeriStar Sub 1B, LLC		MeriStar Sub 5F, L.P.
Assets
Property and equipment	7,293		11,841		17,498		—		—	17,449		45,155		5,047		18,656		17,410
Accumulated depreciation	(97	)	(645	)	(3,696	)	—		—	(2,893	)	(9,963	)	(76	)	(4,064	)	(198	)
	7,196		11,196		13,802		—		—	14,556		35,192		4,971		14,592		17,212
Assets held for sale	—		—		—		—		—	—		—		—		—		—
Restricted cash	—		—		—		—		—	—		—		—		—		—
Investments in affiliate	—		—		—		43		—	—		—		—		—		—
Due from/to subsidiaries	5,122		4,239		5,062		(43	)	—	8,445		21,931		3,545		15,375		12,431
Note receivable from subsidiaries	—		—		—		—		—	—		—		—		—		—
Prepaid expenses and other assets	(1	)	(24	)	28		—		—	(7	)	(33	)	(17	)	(32	)	(63	)
Accounts receivable, net	—		—		—		—		—	103		—		—		96		—
Cash and cash equivalents	—		—		—		—		—	—		—		—		—		—
	12,317		15,411		18,892		—		—	23,097		57,090		8,499		30,031		29,580
Liabilities and Partners’ Capital
Long-term debt	—		—		—		—		—	—		—		—		33		—
Notes payable to MeriStar Hospitality Corporation	—		—		—		—		—	—		—		—		—		—
Accounts payable and accrued expenses	208		(15	)	140		—		—	38		(208	)	351		39		97
Accrued interest	—		—		—		—		—	—		—		—		—		—
Due to Interstate Hotels & Resorts	—		—		—		—		—	—		—		—		—		—
Other liabilities	—		—		—		—		—	—		—		—		—		—
Total liabilities	208		(15	)	140		—		—	38		(208	)	351		72		97
Minority interests	—		—		—		—		—	—		—		—		—		—
Redeemable OP units at redemption value	—		—		—		—		—	—		—		—		—		—
Partners’ capital - Common OP Units	12,109		15,426		18,752		—		—	23,059		57,298		8,148		29,959		29,483
	12,317		15,411		18,892		—		—	23,097		57,090		8,499		30,031		29,580

10

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Balance Sheet

December 31, 2003

(Dollars in thousands)

	MeriStar Sub 6G, LLC		MeriStar Sub 8C, LLC		MeriStar Sub 4C, L.P	MeriStar Sub 4H, L.P.		MeriStar Sub 7E, LLC		MeriStar Sub 3D, LLC		MeriStar Sub 1A, LLC		MeriStar Sub 7A Joint Venture		MeriStar Sub 2B, LLC		MeriStar Sub 3A, LLC
Assets
Property and equipment	22,578		—		—	4,929		18,569		22,682		11,514		5,881		—		3,197
Accumulated depreciation	(5,014	)	—		—	(130	)	(3,323	)	(7,036	)	(2,928	)	(121	)	—		(51	)
	17,564		—		—	4,799		15,246		15,646		8,586		5,760		—		3,146
Assets held for sale	—		5,530		—	—		—		—		—		—		—		—
Restricted cash	—		—		—	—		—		—		—		—		—		—
Investments in affiliate	—		—		—	—		—		—		—		—		—		—
Due from/to subsidiaries	6,988		5,557		—	(791	)	6,367		8,459		7,330		5,021		(7,036	)	1,904
Note receivable from subsidiaries	—		—		—	—		—		—		—		—		—		—
Prepaid expenses and other assets	(12	)	117		—	(8	)	(8	)	(16	)	(56	)	1		—		1
Accounts receivable, net	—		—		—	—		—		—		—		—		2,345		—
Cash and cash equivalents	—		—		—	—		—		—		—		—		—		—
	24,540		11,204		—	4,000		21,605		24,089		15,860		10,782		(4,691	)	5,051
Liabilities and Partners’ Capital
Long-term debt	—		—		—	—		—		—		—		—		—		—
Notes payable to MeriStar Hospitality Corporation	—		—		—	—		—		—		—		—		—		—
Accounts payable and accrued expenses	(69	)	(306	)	—	178		74		30		(17	)	150		(8	)	161
Accrued interest	—		—		—	—		—		—		—		—		—		—
Due to Interstate Hotels & Resorts	—		—		—	—		—		—		—		—		—		—
Other liabilities	—		—		—	—		—		—		—		—		—		—
Total liabilities	(69	)	(306	)	—	178		74		30		(17	)	150		(8	)	161
Minority interests	—		—		—	—		—		—		—		—		—		—
Redeemable OP units at redemption value	—		—		—	—		—		—		—		—		—		—
Partners’ capital - Common OP Units	24,609		11,510		—	3,822		21,531		24,059		15,877		10,632		(4,683	)	4,890
	24,540		11,204		—	4,000		21,605		24,089		15,860		10,782		(4,691	)	5,051

11

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Balance Sheet

December 31, 2003

(Dollars in thousands)

	MeriStar Sub 4A, L.P.		MeriStar Sub 4D, LLC	MeriStar Sub 2A, LLC		MeriStar Sub 6L, LLC	MDV Limited Partnership		MeriStar Sub 5C, LLC	MeriStar Sub 6J, LLC		MeriStar Sub 1D, LLC		MeriStar Sub 7B, L.P.		MeriStar Sub 7D, LLC
Assets
Property and equipment	—		—	—		—	3,850		—	19,530		68,709		4,806		52,417
Accumulated depreciation	—		—	—		—	(686	)	—	(3,776	)	(12,036	)	(156	)	(9,771	)
	—		—	—		—	3,164		—	15,754		56,673		4,650		42,646
Assets held for sale	3,301		—	—		12,395	—		—	—		—		—		—
Restricted cash	—		—	—		—	—		—	—		—		—		—
Investments in affiliate	—		—	—		—	—		—	—		—		—		—
Due from/to subsidiaries	4,573		2,930	(9,934	)	6,238	2,538		5,088	7,636		19,511		(3,011	)	25,422
Note receivable from subsidiaries	—		—	—		—	—		—	—		—		—		—
Prepaid expenses and other assets	(9	)	3	—		15	(4	)	—	23		(209	)	1		192
Accounts receivable, net	—		—	2,002		—	—		—	—		—		—		1,326
Cash and cash equivalents	—		—	—		—	—		—	—		—		—		—
	7,865		2,933	(7,932	)	18,648	5,698		5,088	23,413		75,975		1,640		69,586
Liabilities and Partners’ Capital
Long-term debt	—		—	—		—	—		—	—		—		—		—
Notes payable to MeriStar Hospitality Corporation	—		—	—		—	—		—	—		—		—		—
Accounts payable and accrued expenses	342		—	(8	)	25	96		—	(216	)	(91	)	1,080		4,169
Accrued interest	—		—	—		—	—		—	—		—		—		—
Due to Interstate Hotels & Resorts	—		—	—		—	—		—	—		—		—		(200	)
Other liabilities	—		—	—		—	—		—	—		—		—		—
Total liabilities	342		—	(8	)	25	96		—	(216	)	(91	)	1,080		3,969
Minority interests	—		—	—		—	—		—	—		—		—		—
Redeemable OP units at redemption value	—		—	—		—	—		—	—		—		—		—
Partners’ capital - Common OP Units	7,523		2,933	(7,924	)	18,623	5,602		5,088	23,629		76,066		560		65,617
	7,865		2,933	(7,932	)	18,648	5,698		5,088	23,413		75,975		1,640		69,586

12

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Balance Sheet

December 31, 2003

(Dollars in thousands)

	MeriStar Sub 7G, LLC		MeriStar Sub 6B, LLC		MeriStar Sub 4I, L.P.		MeriStar Sub 5D, LLC		MeriStar Sub 5H, LLC		MeriStar Sub 7H, LLC	AGH PSS I, Inc.	MeriStar Sub 2D, LLC		MeriStar Sub 4F, L.P.		MeriStar Sub 5K, LLC
Assets
Property and equipment	1,901		10,802		—		42,105		—		—	—	—		32,615		28,386
Accumulated depreciation	—		(2,188	)	—		(8,102	)	—		—	—	—		(5,809	)	(5,206	)
	1,901		8,614		—		34,003		—		—	—	—		26,806		23,180
Assets held for sale	—		—		—		—		—		—	—	—		—		—
Restricted cash	—		—		—		—		—		—	—	—		—		—
Investments in affiliate	—		—		—		51,368		—		—	—	—		—		—
Due from/to subsidiaries	365		3,137		1,609		(6,600	)	36,579		9,567	25,579	(6,223	)	5,237		(365	)
Note receivable from subsidiaries	—		—		—		—		—		—	—	—		—		—
Prepaid expenses and other assets	—		(5	)	—		(17	)	1		—	1	—		13		(74	)
Accounts receivable, net	—		—		—		—		46		43	—	1,166		—		—
Cash and cash equivalents	—		—		—		—		—		—	—	—		—		—
	2,266		11,746		1,609		78,754		36,626		9,610	25,580	(5,057	)	32,056		22,741
Liabilities and Partners’ Capital
Long-term debt	—		—		—		24,000		—		—	—	—		—		—
Notes payable to MeriStar Hospitality Corporation	—		—		—		—		—		—	—	—		—		—
Accounts payable and accrued expenses	(6	)	(107	)	(61	)	12		(2	)	—	—	(1	)	370		3,028
Accrued interest	—		—		—		—		—		—	—	—		—		—
Due to Interstate Hotels & Resorts	—		—		—		—		—		—	—	—		—		—
Other liabilities	—		—		—		—		—		—	—	—		—		—
Total liabilities	(6	)	(107	)	(61	)	24,012		(2	)	—	—	(1	)	370		3,028
Minority interests	—		—		—		—		—		—	—	—		—		—
Redeemable OP units at redemption value	—		—		—		—		—		—	—	—		—		—
Partners’ capital - Common OP Units	2,272		11,853		1,670		54,742		36,628		9,610	25,580	(5,056	)	31,686		19,713
	2,266		11,746		1,609		78,754		36,626		9,610	25,580	(5,057	)	32,056		22,741

13

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Balance Sheet

December 31, 2003

(Dollars in thousands)

	MeriStar Sub 5M, LLC		MeriStar Sub 1E, LLC		MeriStar Sub 5O, LLC		MeriStar Sub 4B, L.P.		MeriStar Sub 2C, LLC		MeriStar Sub 4G, L.P.		MeriStar Sub 3B, LLC		MeriStar Sub 5G, L.P.		MeriStar Sub 5N, LLC		MeriStar Sub 5P, LLC
Assets
Property and equipment	22,056		—		8,741		—		—		9,086		—		164,273		4,146		39
Accumulated depreciation	(2,355	)	—		(1,144	)	—		—		—		—		(30,502	)	(679	)	(23	)
	19,701		—		7,597		—		—		9,086		—		133,771		3,467		16
Assets held for sale	—		—		—		7,158		9,415		—		—		—		—		—
Restricted cash	—		—		—		—		—		—		—		—		—		—
Investments in affiliate	—		—		—		—		—		—		—		—		—		—
Due from/to subsidiaries	7,852		24,172		3,077		(4,789	)	5,673		8,806		9,336		42,679		4,243		3,088
Note receivable from subsidiaries	—		—		—		—		—		—		—		—		—		—
Prepaid expenses and other assets	(48	)	(1	)	(15	)	(4	)	(240	)	(89	)	(3	)	(255	)	(18	)	(4	)
Accounts receivable, net	—		198		—		—		—		—		—		—		—		38
Cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
	27,505		24,369		10,659		2,365		14,848		17,803		9,333		176,195		7,692		3,138
Liabilities and Partners’ Capital
Long-term debt	—		—		—		—		19,731		—		—		—		—		—
Notes payable to MeriStar Hospitality Corporation	—		—		—		—		—		—		—		—		—		—
Accounts payable and accrued expenses	—		14		(8	)	410		257		488		—		775		(11	)	—
Accrued interest	—		—		—		—		—		—		—		—		—		—
Due to Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
Other liabilities	—		—		—		—		—		—		—		—		—		—
Total liabilities	—		14		(8	)	410		19,988		488		—		775		(11	)	—
Minority interests	—		—		—		—		—		—		—		—		—		—
Redeemable OP units at redemption value	—		—		—		—		—		—		—		—		—		—
Partners’ capital - Common OP Units	27,505		24,355		10,667		1,955		(5,140	)	17,315		9,333		175,420		7,703		3,138
	27,505		24,369		10,659		2,365		14,848		17,803		9,333		176,195		7,692		3,138

14

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Balance Sheet

December 31, 2003

(Dollars in thousands)

	MeriStar Sub 5J, LLC		MeriStar Sub 5Q, LLC		MeriStar Sub 5A, LLC		MeriStar Sub 8D, LLC		MeriStar Sub 4J, LLC		MeriStar Sub 6K, LLC	MeriStar Sub 5E, LLC	MeriStar Sub 6I, LLC	MeriStar Sub 5I, LLC	CapStar Cherry Hill Company, LLC
Assets
Property and equipment	110,406		16,737		35,707		—		38,463		—	—	—	—	—
Accumulated depreciation	(16,816	)	(2,269	)	(10,686	)	—		(7,127	)	—	—	—	—	—
	93,590		14,468		25,021		—		31,336		—	—	—	—	—
Assets held for sale	—		—		—		9,097		—		—	—	—	—	—
Restricted cash	—		—		—		—		—		—	—	—	—	—
Investments in affiliate	—		—		4,627		—		—		—	—	—	—	—
Due from/to subsidiaries	21,963		4,637		6,562		8,303		7,469		—	—	—	—	—
Note receivable from subsidiaries	—		—		—		—		—		—	—	—	—	—
Prepaid expenses and other assets	(370	)	(53	)	(29	)	14		(19	)	—	—	—	—	—
Accounts receivable, net	—		—		—		—		(13	)	—	—	—	—	—
Cash and cash equivalents	—		—		—		—		—		—	—	—	—	—
	115,183		19,052		36,181		17,414		38,773		—	—	—	—	—
Liabilities and Partners’ Capital
Long-term debt	—		—		23,609		—		—		—	—	—	—	—
Notes payable to MeriStar Hospitality Corporation	—		—		—		—		—		—	—	—	—	—
Accounts payable and accrued expenses	131		(189	)	(195	)	(183	)	81		—	—	—	—	—
Accrued interest	—		—		—		—		—		—	—	—	—	—
Due to Interstate Hotels & Resorts	—		—		—		—		—		—	—	—	—	—
Other liabilities	—		—		—		—		—		—	—	—	—	—
Total liabilities	131		(189	)	23,414		(183	)	81		—	—	—	—	—
Minority interests	—		—		—		—		—		—	—	—	—	—
Redeemable OP units at redemption value	—		—		—		—		—		—	—	—	—	—
Partners’ capital - Common OP Units	115,052		19,241		12,767		17,597		38,692		—	—	—	—	—
	115,183		19,052		36,181		17,414		38,773		—	—	—	—	—

15

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Balance Sheet

December 31, 2003

(Dollars in thousands)

	Meristar Acquisition Company, LLC	MeriStar Sub 6A, LLC	MeriStar Sub 6F, LLC	MeriStar Hotel Lessee, Inc.		Guarantor Subsidiaries Total		Consolidation Eliminations		Total Consolidated
Assets
Property and equipment	—	—	—	3,146		1,055,333		—		$	2,481,752
Accumulated depreciation	—	—	—	(3,284	)	(186,722	)	—			(446,032	)
	—	—	—	(138	)	868,611		—			2,035,720
Assets held for sale	—	—	—	—		46,896		—			51,169
Restricted cash	—	—	—	—		115		—			42,523
Investments in affiliate	—	—	—	1,629		60,760		(2,262,601	)		15,000
Due from/to subsidiaries	—	—	—	(189	)	440,421		—			—
Note receivable from subsidiaries	—	—	—	—		—		(120,855	)		—
Prepaid expenses and other assets	—	—	—	15,471		13,987		—			47,033
Accounts receivable, net	—	—	—	38,183		45,533		—			64,709
Cash and cash equivalents	—	—	—	12,230		12,230		—			230,876
	—	—	—	67,186		1,488,553		(2,383,456	)	$	2,487,030
Liabilities and Partners’ Capital
Long-term debt	—	—	—	81,027		148,400		(120,855	)	$	1,381,555
Notes payable to MeriStar Hospitality Corporation	—	—	—	—		—		—			256,473
Accounts payable and accrued expenses	—	—	—	45,862		59,691		—			80,014
Accrued interest	—	—	—	778		778		—			46,813
Due to Interstate Hotels & Resorts	—	—	—	9,688		9,488		—			16,411
Other liabilities	—	—	—	9,599		9,599		—			11,045
Total liabilities	—	—	—	146,954		227,956		(120,855	)		1,792,311
Minority interests	—	—	—	—		—		—			2,496
Redeemable OP units at redemption value	—	—	—	—		—		—			35,926
Partners’ capital - Common OP Units	—	—	—	(79,768	)	1,260,597		(2,262,601	)		656,297
	—	—	—	67,186		1,488,553		(2,383,456	)	$	2,487,030

16

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2004

(Dollars in thousands)

	MeriStar Hospitality OP, L.P.			Non- Guarantor Subsidiaries		MeriStar Lexington Mortgage, LLC	MeriStar Lexington Partners, LLC	MeriStar Sub 7C, LLC	MeriStar Sub 8G, LLC	AGH Upreit LLC	MeriStar Sub 6H, L.P.	MeriStar Sub 8F, L.P.	MeriStar Sub 8B, LLC
Revenue:
Hotel operations:
Rooms	$	—		—		—	—	—	—	—	—	—	—
Food and beverage		—		—		—	—	—	—	—	—	—	—
Other hotel operations		—		—		—	—	—	—	—	—	—	—
Office rental, parking and other revenue		4,193		417		—	—	—	—	—	—	35	—
Participating lease revenue		—		151,439		1,439	237	—	—	—	1,286	2,404	7,454
Total revenue		4,193		151,856		1,439	237	—	—	—	1,286	2,439	7,454
Hotel operating expenses:
Rooms		—		—		—	—	—	—	—	—	—	—
Food and beverage		—		—		—	—	—	—	—	—	—	—
Other hotel operating expenses		—		—		—	—	—	—	—	—	—	—
Office rental, parking and other expenses		—		1,194		—	—	—	—	—	—	—	(2,612	)
Other operating expenses:
General and administrative, hotel		—		—		—	—	—	—	—	—	—	—
General and administrative, corporate		13,977		—		—	—	—	—	—	—	—	—
Property operating costs		—		—		—	—	—	—	—	—	—	—
Depreciation and amortization		7,964		51,781		—	—	—	—	—	627	658	2,483
Property taxes, insurance and other		5,681		33,856		—	—	—	—	—	98	626	1,450
Loss on asset impairments		—		2,103		—	—	—	—	—	—	—	—
Operating expenses		27,622		88,934		—	—	—	—	—	725	1,284	1,321
Equity in income of and interest earned from unconsolidated affiliates		13,147		—		—	—	—	—	—	—	—	—
Operating income (loss)		(10,282	)	62,922		1,439	237	—	—	—	561	1,155	6,133
Minority interest		79		—		—	—	—	—	—	—	—	—
Interest expense, net		(77,362	)	(35,196	)	—	—	—	—	—	—	—	—
(Loss) gain on early extinguishments of debt		(7,967	)	—		—	—	—	—	—	—	—	—
Equity in income from consolidated entities		(3,957	)	—		—	—	—	—	—	—	—	—
(Loss) income before income taxes and discontinued operations		(99,489	)	27,726		1,439	237	—	—	—	561	1,155	6,133
Income tax benefit		367		—		—	—	—	—	—	—	—	—
(Loss) income from continuing operations		(99,122	)	27,726		1,439	237	—	—	—	561	1,155	6,133
Discontinued operations:
(Loss) income from discontinued operations before income tax		(145	)	3,444		—	—	—	—	—	—	—	—
Income tax benefit		134		—		—	—	—	—	—	—	—	—
(Loss) income from discontinued operations		(11	)	3,444		—	—	—	—	—	—	—	—
Net income (loss)	$	(99,133	)	31,170		1,439	237	—	—	—	561	1,155	6,133

17

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2004

(Dollars in thousands)

	MeriStar Sub 1C, LLC		MeriStar Sub 8E, LLC	MeriStar Sub 7F, LLC	MeriStar Sub 5L, LLC	MeriStar Sub 3C, LLC	MeriStar Sub 5R, LLC	MeriStar Sub 8A, LLC	MeriStar Sub 6D, LLC	MeriStar Sub 6E, LLC	MeriStar Sub 4E, L.P.
Revenue:
Hotel operations:
Rooms	—		—	—	—	—	—	—	—	—	—
Food and beverage	—		—	—	—	—	—	—	—	—	—
Other hotel operations	—		—	—	—	—	—	—	—	—	—
Office rental, parking and other revenue	—		29	—	—	3	—	—	57	—	—
Participating lease revenue	1,185		1,485	926	888	1,921	—	—	2,122	5,914	—
Total revenue	1,185		1,514	926	888	1,924	—	—	2,179	5,914	—
Hotel operating expenses:
Rooms	—		—	—	—	—	—	—	—	—	—
Food and beverage	—		—	—	—	—	—	—	—	—	—
Other hotel operating expenses	—		—	—	—	—	—	—	—	—	—
Office rental, parking and other expenses	—		—	—	—	—	—	—	—	—	—
Other operating expenses:
General and administrative, hotel	—		—	—	—	—	—	—	—	—	—
General and administrative, corporate	—		—	—	—	—	—	—	—	—	—
Property operating costs	—		—	—	—	—	—	—	—	—	—
Depreciation and amortization	1,419		594	316	155	698	—	—	484	1,596	—
Property taxes, insurance and other	702		198	124	137	392	—	—	310	521	—
Loss on asset impairments	—		—	—	—	—	—	—	—	—	—
Operating expenses	2,121		792	440	292	1,090	—	—	794	2,117	—
Equity in income of and interest earned from unconsolidated affiliates	—		—	—	—	—	—	—	—	—	—
Operating income (loss)	(936	)	722	486	596	834	—	—	1,385	3,797	—
Minority interest	—		—	—	—	—	—	—	—	—	—
Interest expense, net	—		—	—	—	—	—	—	—	—	—
(Loss) gain on early extinguishments of debt	—		—	—	—	—	—	—	—	—	—
Equity in income from consolidated entities	—		—	—	—	—	—	—	—	—	—
(Loss) income before income taxes and discontinued operations	(936	)	722	486	596	834	—	—	1,385	3,797	—
Income tax benefit	—		—	—	—	—	—	—	—	—	—
(Loss) income from continuing operations	(936	)	722	486	596	834	—	—	1,385	3,797	—
Discontinued operations:
(Loss) income from discontinued operations before income tax	—		—	—	—	—	—	—	—	—	(1,058	)
Income tax benefit	—		—	—	—	—	—	—	—	—	—
(Loss) income from discontinued operations	—		—	—	—	—	—	—	—	—	(1,058	)
Net income (loss)	(936	)	722	486	596	834	—	—	1,385	3,797	(1,058	)

18

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2004

(Dollars in thousands)

	MeriStar Sub 1B, LLC		MeriStar Sub 5F, L.P.	MeriStar Sub 6G, LLC	MeriStar Sub 8C, LLC		MeriStar Sub 4C, L.P.	MeriStar Sub 4H, L.P.		MeriStar Sub 7E, LLC	MeriStar Sub 3D, LLC	MeriStar Sub 1A, LLC		MeriStar Sub 7A Joint Venture
Revenue:
Hotel operations:
Rooms	—		—	—	—		—	—		—	—	—		—
Food and beverage	—		—	—	—		—	—		—	—	—		—
Other hotel operations	—		—	—	—		—	—		—	—	—		—
Office rental, parking and other revenue	(4	)	—	—	—		—	—		1	—	—		—
Participating lease revenue	2,090		1,949	3,532	—		—	—		1,379	1,488	1,690		—
Total revenue	2,086		1,949	3,532	—		—	—		1,380	1,488	1,690		—
Hotel operating expenses:
Rooms	—		—	—	—		—	—		—	—	—		—
Food and beverage	—		—	—	—		—	—		—	—	—		—
Other hotel operating expenses	—		—	—	—		—	—		—	—	—		—
Office rental, parking and other expenses	3		—	—	—		—	—		—	—	95		—
Other operating expenses:
General and administrative, hotel	—		—	—	—		—	—		—	—	—		—
General and administrative, corporate	—		—	—	—		—	—		—	—	—		—
Property operating costs	—		—	—	—		—	—		—	—	—		—
Depreciation and amortization	493		772	724	—		—	—		651	703	279		—
Property taxes, insurance and other	142		353	392	—		—	—		200	217	403		—
Loss on asset impairments	—		—	—	—		—	—		—	—	2,871		—
Operating expenses	638		1,125	1,116	—		—	—		851	920	3,648		—
Equity in income of and interest earned from unconsolidated affiliates	—		—	—	—		—	—		—	—	—		—
Operating income (loss)	1,448		824	2,416	—		—	—		529	568	(1,958	)	—
Minority interest	—		—	—	—		—	—		—	—	—		—
Interest expense, net	—		—	—	—		—	—		—	—	—		—
(Loss) gain on early extinguishments of debt	—		—	—	—		—	—		—	—	—		—
Equity in income from consolidated entities	—		—	—	—		—	—		—	—	—		—
(Loss) income before income taxes and discontinued operations	1,448		824	2,416	—		—	—		529	568	(1,958	)	—
Income tax benefit	—		—	—	—		—	—		—	—	—		—
(Loss) income from continuing operations	1,448		824	2,416	—		—	—		529	568	(1,958	)	—
Discontinued operations:
(Loss) income from discontinued operations before income tax	—		—	—	(61	)	—	(403	)	—	—	—		(732	)
Income tax benefit	—		—	—	—		—	—		—	—	—		—
(Loss) income from discontinued operations	—		—	—	(61	)	—	(403	)	—	—	—		(732	)
Net income (loss)	1,448		824	2,416	(61	)	—	(403	)	529	568	(1,958	)	(732	)

19

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2004

(Dollars in thousands)

	MeriStar Sub 2B, LLC	MeriStar Sub 3A, LLC	MeriStar Sub 4A, LP	MeriStar Sub 4D, LLC	MeriStar Sub 2A, LLC	MeriStar Sub 6L, LLC	MDV Limited Partnership	MeriStar Sub 5C, LLC	MeriStar Sub 6J, LLC	MeriStar Sub 1D, LLC
Revenue:
Hotel operations:
Rooms	—	—	—	—	—	—	—	—	—	—
Food and beverage	—	—	—	—	—	—	—	—	—	—
Other hotel operations	—	—	—	—	—	—	—	—	—	—
Office rental, parking and other revenue	—	—	—	—	—	—	—	—	—	8
Participating lease revenue	—	—	—	—	—	—	518	—	2,651	5,296
Total revenue	—	—	—	—	—	—	518	—	2,651	5,304
Hotel operating expenses:
Rooms	—	—	—	—	—	—	—	—	—	—
Food and beverage	—	—	—	—	—	—	—	—	—	—
Other hotel operating expenses	—	—	—	—	—	—	—	—	—	—
Office rental, parking and other expenses	—	—	—	—	—	—	—	—	—	102
Other operating expenses:
General and administrative, hotel	—	—	—	—	—	—	—	—	—	—
General and administrative, corporate	—	—	—	—	—	—	—	—	—	—
Property operating costs	—	—	—	—	—	—	—	—	—	—
Depreciation and amortization	—	—	—	—	—	—	154	—	556	2,286
Property taxes, insurance and other	—	—	—	—	—	—	69	—	297	1,459
Loss on asset impairments	—	—	—	—	—	—	—	—	—	—
Operating expenses	—	—	—	—	—	—	223	—	853	3,847
Equity in income of and interest earned from unconsolidated affiliates	—	—	—	—	—	—	—	—	—	—
Operating income (loss)	—	—	—	—	—	—	295	—	1,798	1,457
Minority interest	—	—	—	—	—	—	—	—	—	—
Interest expense, net	—	—	—	—	—	—	—	—	—	—
(Loss) gain on early extinguishments of debt	—	—	—	—	—	—	—	—	—	—
Equity in income from consolidated entities	—	—	—	—	—	—	—	—	—	—
(Loss) income before income taxes and discontinued operations	—	—	—	—	—	—	295	—	1,798	1,457
Income tax benefit	—	—	—	—	—	—	—	—	—	—
(Loss) income from continuing operations	—	—	—	—	—	—	295	—	1,798	1,457
Discontinued operations:
(Loss) income from discontinued operations before income tax	—	89	97	—	—	1,852	—	—	—	—
Income tax benefit	—	—	—	—	—	—	—	—	—	—
(Loss) income from discontinued operations	—	89	97	—	—	1,852	—	—	—	—
Net income (loss)	—	89	97	—	—	1,852	295	—	1,798	1,457

20

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2004

(Dollars in thousands)

	MeriStar Sub 7B, L.P.		MeriStar Sub 7D, LLC	MeriStar Sub 7G, LLC	MeriStar Sub 6B, LLC	MeriStar Sub 4I, L.P.	MeriStar Sub 5D, LLC		MeriStar Sub 5H, LLC	MeriStar Sub 7H, LLC	AGH PSS I, Inc.	MeriStar Sub 2D, LLC
Revenue:
Hotel operations:
Rooms	—		—	—	—	—	—		—	—	—	—
Food and beverage	—		—	—	—	—	—		—	—	—	—
Other hotel operations	—		—	—	—	—	—		—	—	—	—
Office rental, parking and other revenue	—		—	—	—	—	—		—	—	—	—
Participating lease revenue	—		7,368	—	1,160	—	2,189		—	—	—	—
Total revenue	—		7,368	—	1,160	—	2,189		—	—	—	—
Hotel operating expenses:
Rooms	—		—	—	—	—	—		—	—	—	—
Food and beverage	—		—	—	—	—	—		—	—	—	—
Other hotel operating expenses	—		—	—	—	—	—		—	—	—	—
Office rental, parking and other expenses	—		718	—	—	—	—		—	—	—	—
Other operating expenses:
General and administrative, hotel	—		—	—	—	—	—		—	—	—	—
General and administrative, corporate	—		—	—	—	—	—		—	—	—	—
Property operating costs	—		—	—	—	—	—		—	—	—	—
Depreciation and amortization	—		1,572	—	448	—	1,432		—	—	—	—
Property taxes, insurance and other	—		1,200	—	223	—	194		—	—	—	—
Loss on asset impairments	—		—	—	—	—	—		—	—	—	—
Operating expenses	—		3,490	—	671	—	1,626		—	—	—	—
Equity in income of and interest earned from unconsolidated affiliates	—		—	—	—	—	—		—	—	—	��
Operating income (loss)	—		3,878	—	489	—	563		—	—	—	—
Minority interest	—		—	—	—	—	—		—	—	—	—
Interest expense, net	—		—	—	—	—	(1,367	)	—	—	—	—
(Loss) gain on early extinguishments of debt	—		—	—	—	—	—		—	—	—	—
Equity in income from consolidated entities	—		—	—	—	—	—		—	—	—	—
(Loss) income before income taxes and discontinued operations	—		3,878	—	489	—	(804	)	—	—	—	—
Income tax benefit	—		—	—	—	—	—		—	—	—	—
(Loss) income from continuing operations	—		3,878	—	489	—	(804	)	—	—	—	—
Discontinued operations:
(Loss) income from discontinued operations before income tax	(787	)	—	103	—	—	—		—	—	—	—
Income tax benefit	—		—	—	—	—	—		—	—	—	—
(Loss) income from discontinued operations	(787	)	—	103	—	—	—		—	—	—	—
Net income (loss)	(787	)	3,878	103	489	—	(804	)	—	—	—	—

21

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2004

(Dollars in thousands)

	MeriStar Sub 4F, L.P.	MeriStar Sub 5K, LLC	MeriStar Sub 5M, LLC	MeriStar Sub 1E, LLC	MeriStar Sub 5O, LLC	MeriStar Sub 4B, L.P.		MeriStar Sub 2C, LLC		MeriStar Sub 4G, L.P.		MeriStar Sub 3B, LLC	MeriStar Sub 5G, L.P.
Revenue:
Hotel operations:
Rooms	—	—	—	—	—	—		—		—		—	—
Food and beverage	—	—	—	—	—	—		—		—		—	—
Other hotel operations	—	—	—	—	—	—		—		—		—	—
Office rental, parking and other revenue	17	—	—	—	—	—		—		—		—	26
Participating lease revenue	1,967	—	1,149	—	542	—		—		—		—	10,397
Total revenue	1,984	—	1,149	—	542	—		—		—		—	10,423
Hotel operating expenses:
Rooms	—	—	—	—	—	—		—		—		—	—
Food and beverage	—	—	—	—	—	—		—		—		—	—
Other hotel operating expenses	—	—	—	—	—	—		—		—		—	—
Office rental, parking and other expenses	—	—	—	—	—	—		—		—		—	8
Other operating expenses:
General and administrative, hotel	—	—	—	—	—	—		—		—		—	—
General and administrative, corporate	—	—	—	—	—	—		—		—		—	—
Property operating costs	—	—	—	—	—	—		—		—		—	—
Depreciation and amortization	1,114	—	423	—	210	—		—		—		—	6,364
Property taxes, insurance and other	367	—	243	—	95	—		—		—		—	1,537
Loss on asset impairments	—	—	—	—	—	—		—		—		—	—
Operating expenses	1,481	—	666	—	305	—		—		—		—	7,909
Equity in income of and interest earned from unconsolidated affiliates	—	—	—	—	—	—		—		—		—	—
Operating income (loss)	503	—	483	—	237	—		—		—		—	2,514
Minority interest	—	—	—	—	—	—		—		—		—	—
Interest expense, net	—	—	—	—	—	—		—		—		—	—
(Loss) gain on early extinguishments of debt	—	—	—	—	—	—		—		—		—	—
Equity in income from consolidated entities	—	—	—	—	—	—		—		—		—	—
(Loss) income before income taxes and discontinued operations	503	—	483	—	237	—		—		—		—	2,514
Income tax benefit	—	—	—	—	—	—		—		—		—	—
(Loss) income from continuing operations	503	—	483	—	237	—		—		—		—	2,514
Discontinued operations:
(Loss) income from discontinued operations before income tax	—	1,835	—	—	—	(217	)	(2,242	)	(373	)	—	—
Income tax benefit	—	—	—	—	—	—		—		—		—	—
(Loss) income from discontinued operations	—	1,835	—	—	—	(217	)	(2,242	)	(373	)	—	—
Net income (loss)	503	1,835	483	—	237	(217	)	(2,242	)	(373	)	—	2,514

22

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2004

(Dollars in thousands)

	MeriStar Sub 5N, LLC	MeriStar Sub 5P, LLC	MeriStar Sub 5J, LLC		MeriStar Sub 5Q, LLC	MeriStar Sub 5A, LLC		MeriStar Sub 8D, LLC		MeriStar Sub 4J, LLC	Meristar Pentagon City, LLC		MeriStar Sub 6K, LLC	MeriStar Sub 5E, LLC
Revenue:
Hotel operations:
Rooms	—	—	—		—	—		—		—	—		—	—
Food and beverage	—	—	—		—	—		—		—	—		—	—
Other hotel operations	—	—	—		—	—		—		—	—		—	—
Office rental, parking and other revenue	—	—	—		—	85		—		5	—		—	—
Participating lease revenue	591	636	6,380		1,314	6,055		—		3,038	6,218		—	—
Total revenue	591	636	6,380		1,314	6,140		—		3,043	6,218		—	—
Hotel operating expenses:
Rooms	—	—	—		—	—		—		—	—		—	—
Food and beverage	—	—	—		—	—		—		—	—		—	—
Other hotel operating expenses	—	—	—		—	—		—		—	—		—	—
Office rental, parking and other expenses	—	—	28		—	6		—		447	12		—	—
Other operating expenses:
General and administrative, hotel	—	—	—		—	—		—		—	—		—	—
General and administrative, corporate	—	—	—		—	—		—		—	—		—	—
Property operating costs	—	—	—		—	—		—		—	—		—	—
Depreciation and amortization	123	5	5,171		565	1,081		—		1,272	3,515		—	—
Property taxes, insurance and other	98	6	1,224		251	810		—		374	1,231		—	—
Loss on asset impairments	—	—	—		—	—		—		—	—		—	—
Operating expenses	221	11	6,423		816	1,897		—		2,093	4,758		—	—
Equity in income of and interest earned from unconsolidated affiliates	—	—	—		—	—		—		—	—		—	—
Operating income (loss)	370	625	(43	)	498	4,243		—		950	1,460		—	—
Minority interest	—	—	—		—	—		—		—	—		—	—
Interest expense, net	—	—	—		—	(2,833	)	—		—	(1,621	)	—	—
(Loss) gain on early extinguishments of debt	—	—	—		—	—		—		—	—		—	—
Equity in income from consolidated entities	—	—	—		—	—		—		—	—		—	—
(Loss) income before income taxes and discontinued operations	370	625	(43	)	498	1,410		—		950	(161	)	—	—
Income tax benefit	—	—	—		—	—		—		—	—		—	—
(Loss) income from continuing operations	370	625	(43	)	498	1,410		—		950	(161	)	—	—
Discontinued operations:
(Loss) income from discontinued operations before income tax	—	—	—		—	—		(857	)	—	—		—	—
Income tax benefit	—	—	—		—	—		—		—	—		—	—
(Loss) income from discontinued operations	—	—	—		—	—		(857	)	—	—		—	—
Net income (loss)	370	625	(43	)	498	1,410		(857	)	950	(161	)	—	—

23

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2004

(Dollars in thousands)

	MeriStar Sub 6I, LLC	MeriStar Sub 5I, LLC	CapStar Cherry Hill Company, LLC	Meristar Acquisition Company, LLC	MeriStar Sub 6A, LLC	MeriStar Sub 6F, LLC	MeriStar Hotel Lessee, Inc.		Guarantor Eliminations		Guarantor Subsidiaries Total		Consolidation Eliminations		Total Consolidated
Revenue:
Hotel operations:
Rooms	—	—	—	—	—	—	507,897		—		507,897		—		$	507,897
Food and beverage	—	—	—	—	—	—	212,132		—		212,132		—			212,132
Other hotel operations	—	—	—	—	—	—	54,111		—		54,111		—			54,111
Office rental, parking and other revenue	—	—	—	—	—	—	160		—		422		—			5,032
Participating lease revenue	—	—	—	—	—	—	1,439		(1,439	)	96,858		(248,297	)		—
Total revenue	—	—	—	—	—	—	775,739		(1,439	)	871,420		(248,297	)		779,172
Hotel operating expenses:
Rooms	—	—	—	—	—	—	129,007		—		129,007		—			129,007
Food and beverage	—	—	—	—	—	—	153,150		—		153,150		—			153,150
Other hotel operating expenses	—	—	—	—	—	—	34,480		—		34,480		—			34,480
Office rental, parking and other expenses	—	—	—	—	—	—	2,394		—		1,201		—			2,395
Other operating expenses:
General and administrative, hotel	—	—	—	—	—	—	123,502		—		123,502		—			123,502
General and administrative, corporate	—	—	—	—	—	—	238		—		238		—			14,215
Property operating costs	—	—	—	—	—	—	117,077		—		117,077		—			117,077
Depreciation and amortization	—	—	—	—	—	—	98		—		39,041		—			98,786
Property taxes, insurance and other	—	—	—	—	—	—	249,782		—		265,725		(248,297	)		56,965
Loss on asset impairments	—	—	—	—	—	—	—		—		2,871		—			4,974
Operating expenses	—	—	—	—	—	—	809,728		—		866,292		(248,297	)		734,551
Equity in income of and interest earned from unconsolidated affiliates	—	—	—	—	—	—	—		—		—		—			13,147
Operating income (loss)	—	—	—	—	—	—	(33,989	)	(1,439	)	5,128		—			57,768
Minority interest	—	—	—	—	—	—	—		—		—		—			79
Interest expense, net	—	—	—	—	—	—	(8,548	)	—		(14,369	)	—			(126,927	)
(Loss) gain on early extinguishments of debt	—	—	—	—	—	—	—		—		—		—			(7,967	)
Equity in income from consolidated entities	—	—	—	—	—	—	—		—		—		3,957			—
(Loss) income before income taxes and discontinued operations	—	—	—	—	—	—	(42,537	)	(1,439	)	(9,241	)	3,957			(77,047	)
Income tax benefit	—	—	—	—	—	—	—		—		—		—			367
(Loss) income from continuing operations	—	—	—	—	—	—	(42,537	)	(1,439	)	(9,241	)	3,957			(76,680	)
Discontinued operations:
(Loss) income from discontinued operations before income tax	—	—	—	—	—	—	(23,132	)	—		(25,886	)	—			(22,587	)
Income tax benefit	—	—	—	—	—	—	—		—		—		—			134
(Loss) income from discontinued operations	—	—	—	—	—	—	(23,132	)	—		(25,886	)	—			(22,453	)
Net income (loss)	—	—	—	—	—	—	(65,669	)	(1,439	)	(35,127	)	3,957		$	(99,133	)

24

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2003

(Dollars in thousands)

	MeriStar Hospitality OP, L.P.			Non- Guarantor Subsidiaries		MeriStar Sub 7C, LLC	AGH Upreit LLC	MeriStar Sub 5N, LLC	MeriStar Sub 8A, LLC	MeriStar Sub 8F, L.P.	MeriStar Sub 8G, LLC	MeriStar Sub 6H, L.P.	MeriStar Sub 8B, LLC
Revenue:
Hotel operations:
Rooms	$	—		—		—	—	—	—	—	—	—	—
Food and beverage		—		—		—	—	—	—	—	—	—	—
Other hotel operations		—		—		—	—	—	—	—	—	—	—
Office rental, parking and other revenue		(258	)	3,810		—	—	—	—	—	—	—	—
Participating lease revenue		—		130,138		—	—	851	—	2,345	—	1,172	7,273
Total revenue		(258	)	133,948		—	—	851	—	2,345	—	1,172	7,273
Hotel operating expenses:
Rooms		—		—		—	—	—	—	—	—	—	—
Food and beverage		—		—		—	—	—	—	—	—	—	—
Other hotel operating expenses		—		—		—	—	—	—	—	—	—	—
Office rental, parking and other expenses		—		1,147		—	—	—	—	—	—	—	—
Other operating expenses:
General and administrative, hotel		—		11		—	—	—	—	1	—	—	1
General and administrative, corporate		11,913		—		—	—	—	—	—	—	—	—
Property operating costs		(2,453	)	—		—	—	—	—	—	—	—	—
Depreciation and amortization		13,482		42,724		—	—	137	—	587	—	569	2,416
Property taxes, insurance and other		(1,489	)	36,800		—	—	102	—	549	—	93	1,415
Loss on asset impairments		—		15,566		—	—	—	—	—	—	500	—
Operating expenses		21,453		96,248		—	—	239	—	1,137	—	1,162	3,832
Equity in income of and interest earned from unconsolidated affiliates, net of impairment charge in 2003		(17,631	)	—		—	—	—	—	—	—	—	—
Operating income (loss)		(39,342	)	37,700		—	—	612	—	1,208	—	10	3,441
Minority interest		62		—		—	—	—	—	—	—	—	—
Interest expense, net		(105,834	)	(27,857	)	—	—	—	—	—	—	—	—
(Loss) gain on early extinguishments of debt		4,085		—		—	—	—	—	—	—	—	—
Equity in income from consolidated entities		(270,566	)	—		—	—	—	—	—	—	—	—
(Loss) income before income taxes and discontinued operations		(411,595	)	9,843		—	—	612	—	1,208	—	10	3,441
Income tax benefit		3,689		—		—	—	—	—	—	—	—	—
(Loss) income from continuing operations		(407,906	)	9,843		—	—	612	—	1,208	—	10	3,441
Discontinued operations:
(Loss) income from discontinued operations before income tax		3,402		(98,676	)	—	—	—	—	—	—	—	—
Income tax benefit		67		—		—	—	—	—	—	—	—	—
(Loss) income from discontinued operations		3,469		(98,676	)	—	—	—	—	—	—	—	—
Net income (loss)	$	(404,437	)	(88,833	)	—	—	612	—	1,208	—	10	3,441

25

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2003

(Dollars in thousands)

	MeriStar Sub 1C, LLC		MeriStar Sub 8E, LLC	MeriStar Sub 7F, LLC		MeriStar Sub 5L, LLC		MeriStar Sub 3C, LLC	MeriStar Sub 5R, LLC	MeriStar Sub 6D, LLC	MeriStar Sub 6E, LLC	MeriStar Sub 4E, L.P.		MeriStar Sub 1B, LLC
Revenue:
Hotel operations:
Rooms	—		—	—		—		—	—	—	—	—		—
Food and beverage	—		—	—		—		—	—	—	—	—		—
Other hotel operations	—		—	—		—		—	—	—	—	—		—
Office rental, parking and other revenue	—		47	—		—		2	—	194	—	—		338
Participating lease revenue	1,211		1,449	935		955		1,710	—	1,794	5,213	—		2,485
Total revenue	1,211		1,496	935		955		1,712	—	1,988	5,213	—		2,823
Hotel operating expenses:
Rooms	—		—	—		—		—	—	—	—	—		—
Food and beverage	—		—	—		—		—	—	—	—	—		—
Other hotel operating expenses	—		—	—		—		—	—	—	—	—		—
Office rental, parking and other expenses	—		—	—		—		—	—	—	—	—		—
Other operating expenses:
General and administrative, hotel	1		1	—		—		1	—	1	—	—		—
General and administrative, corporate	—		—	—		—		—	—	—	—	—		—
Property operating costs	—		—	—		—		—	—	—	—	—		—
Depreciation and amortization	1,015		583	425		142		709	—	546	1,629	—		535
Property taxes, insurance and other	773		215	161		129		407	—	329	671	—		155
Loss on asset impairments	—		—	2,037		—		—	—	—	—	—		—
Operating expenses	1,789		799	2,623		271		1,117	—	876	2,300	—		690
Equity in income of and interest earned from unconsolidated affiliates, net of impairment charge in 2003	—		—	—		—		—	—	—	—	—		—
Operating income (loss)	(578	)	697	(1,688	)	684		595	—	1,112	2,913	—		2,133
Minority interest	—		—	—		—		—	—	—	—	—		—
Interest expense, net	—		—	—		(2	)	—	—	—	—	—		(13	)
(Loss) gain on early extinguishments of debt	—		—	—		—		—	—	—	—	—		—
Equity in income from consolidated entities	—		—	—		—		—	—	—	—	—		—
(Loss) income before income taxes and discontinued operations	(578	)	697	(1,688	)	682		595	—	1,112	2,913	—		2,120
Income tax benefit	—		—	—		—		—	—	—	—	—		—
(Loss) income from continuing operations	(578	)	697	(1,688	)	682		595	—	1,112	2,913	—		2,120
Discontinued operations:
(Loss) income from discontinued operations before income tax	—		—	—		—		—	—	—	—	(14,966	)	—
Income tax benefit	—		—	—		—		—	—	—	—	—		—
(Loss) income from discontinued operations	—		—	—		—		—	—	—	—	(14,966	)	—
Net income (loss)	(578	)	697	(1,688	)	682		595	—	1,112	2,913	(14,966	)	2,120

26

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2003

(Dollars in thousands)

	MeriStar Sub 5F, L.P.		MeriStar Sub 6G, LLC	MeriStar Sub 8C, LLC		MeriStar Sub 4C, L.P	MeriStar Sub 4H, L.P.		MeriStar Sub 7E, LLC	MeriStar Sub 3D, LLC	MeriStar Sub 1A, LLC	MeriStar Sub 5E, LLC	MeriStar Sub 7A Joint Venture
Revenue:
Hotel operations:
Rooms	—		—	—		—	—		—	—	—	—	—
Food and beverage	—		—	—		—	—		—	—	—	—	—
Other hotel operations	—		—	—		—	—		—	—	—	—	—
Office rental, parking and other revenue	—		—	—		—	—		—	1	—	—	—
Participating lease revenue	2,625		2,527	—		—	—		1,345	1,431	1,798	3,934	—
Total revenue	2,625		2,527	—		—	—		1,345	1,432	1,798	3,934	—
Hotel operating expenses:
Rooms	—		—	—		—	—		—	—	—	—	—
Food and beverage	—		—	—		—	—		—	—	—	—	—
Other hotel operating expenses	—		—	—		—	—		—	—	—	—	—
Office rental, parking and other expenses	—		—	—		—	—		—	—	—	—	—
Other operating expenses:
General and administrative, hotel	—		1	—		—	—		1	—	—	—	—
General and administrative, corporate	—		—	—		—	—		—	—	—	—	—
Property operating costs	—		—	—		—	—		—	—	—	—	—
Depreciation and amortization	941		848	—		—	—		615	776	450	1,438	—
Property taxes, insurance and other	396		376	—		—	—		196	233	421	302	—
Loss on asset impairments	9,231		—	—		—	—		—	—	—	—	—
Operating expenses	10,568		1,225	—		—	—		812	1,009	871	1,740	—
Equity in income of and interest earned from unconsolidated affiliates, net of impairment charge in 2003	—		—	—		—	—		—	—	—	—	—
Operating income (loss)	(7,943	)	1,302	—		—	—		533	423	927	2,194	—
Minority interest	—		—	—		—	—		—	—	—	—	—
Interest expense, net	—		—	—		—	—		—	—	—	—	—
(Loss) gain on early extinguishments of debt	—		—	—		—	—		—	—	—	—	—
Equity in income from consolidated entities	—		—	—		—	—		—	—	—	—	—
(Loss) income before income taxes and discontinued operations	(7,943	)	1,302	—		—	—		533	423	927	2,194	—
Income tax benefit	—		—	—		—	—		—	—	—	—	—
(Loss) income from continuing operations	(7,943	)	1,302	—		—	—		533	423	927	2,194	—
Discontinued operations:
(Loss) income from discontinued operations before income tax	—		—	(4,555	)	—	(5,491	)	—	—	—	—	(4,907	)
Income tax benefit	—		—	—		—	—		—	—	—	—	—
(Loss) income from discontinued operations	—		—	(4,555	)	—	(5,491	)	—	—	—	—	(4,907	)
Net income (loss)	(7,943	)	1,302	(4,555	)	—	(5,491	)	533	423	927	2,194	(4,907	)

27

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2003

(Dollars in thousands)

	MeriStar Sub 6K, LLC	MeriStar Sub 2B, LLC		MeriStar Sub 3A, LLC		MeriStar Sub 4A, LP		MeriStar Sub 4D, LLC		MeriStar Sub 2A, LLC		MeriStar Sub 6L, LLC		MDV Limited Partnership	MeriStar Sub 5C, LLC		MeriStar Sub 6J, LLC
Revenue:
Hotel operations:
Rooms	—	—		—		—		—		—		—		—	—		—
Food and beverage	—	—		—		—		—		—		—		—	—		—
Other hotel operations	—	—		—		—		—		—		—		—	—		—
Office rental, parking and other revenue	—	—		—		—		—		—		—		—	—		—
Participating lease revenue	2,980	—		—		—		—		—		—		506	—		2,148
Total revenue	2,980	—		—		—		—		—		—		506	—		2,148
Hotel operating expenses:
Rooms	—	—		—		—		—		—		—		—	—		—
Food and beverage	—	—		—		—		—		—		—		—	—		—
Other hotel operating expenses	—	—		—		—		—		—		—		—	—		—
Office rental, parking and other expenses	—	—		—		—		—		—		—		—	—		—
Other operating expenses:
General and administrative, hotel	—	—		—		—		—		—		—		—	—		—
General and administrative, corporate	—	—		—		—		—		—		—		—	—		—
Property operating costs	—	—		—		—		—		—		—		—	—		—
Depreciation and amortization	538	—		—		—		—		—		—		139	—		581
Property taxes, insurance and other	288	—		—		—		—		—		—		139	—		262
Loss on asset impairments	—	—		—		—		—		—		—		—	—		—
Operating expenses	826	—		—		—		—		—		—		278	—		843
Equity in income of and interest earned from unconsolidated affiliates, net of impairment charge in 2003	—	—		—		—		—		—		—		—	—		—
Operating income (loss)	2,154	—		—		—		—		—		—		228	—		1,305
Minority interest	—	—		—		—		—		—		—		—	—		—
Interest expense, net	—	—		—		—		—		—		—		—	—		2
(Loss) gain on early extinguishments of debt	—	—		—		—		—		—		—		—	—		—
Equity in income from consolidated entities	—	—		—		—		—		—		—		—	—		—
(Loss) income before income taxes and discontinued operations	2,154	—		—		—		—		—		—		228	—		1,307
Income tax benefit	—	—		—		—		—		—		—		—	—		—
(Loss) income from continuing operations	2,154	—		—		—		—		—		—		228	—		1,307
Discontinued operations:
(Loss) income from discontinued operations before income tax	—	(6,486	)	(1,933	)	(845	)	(939	)	(5,037	)	(12,550	)	—	(5,634	)	—
Income tax benefit	—	—		—		—		—		—		—		—	—		—
(Loss) income from discontinued operations	—	(6,486	)	(1,933	)	(845	)	(939	)	(5,037	)	(12,550	)	—	(5,634	)	—
Net income (loss)	2,154	(6,486	)	(1,933	)	(845	)	(939	)	(5,037	)	(12,550	)	228	(5,634	)	1,307

28

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2003

(Dollars in thousands)

	MeriStar Sub 1D, LLC	MeriStar Sub 7B, L.P.		MeriStar Sub 7D, LLC	MeriStar Sub 7G, LLC		MeriStar Sub 6B, LLC	MeriStar Sub 4I, L.P.		MeriStar Sub 5D, LLC		MeriStar Sub 5H, LLC		MeriStar Sub 7H, LLC		AGH PSS I, Inc.
Revenue:
Hotel operations:
Rooms	—	—		—	—		—	—		—		—		—		—
Food and beverage	—	—		—	—		—	—		—		—		—		—
Other hotel operations	—	—		—	—		—	—		—		—		—		—
Office rental, parking and other revenue	282	—		1,964	—		—	—		—		—		—		—
Participating lease revenue	4,536	—		5,700	—		1,082	—		2,050		—		—		—
Total revenue	4,818	—		7,664	—		1,082	—		2,050		—		—		—
Hotel operating expenses:
Rooms	—	—		—	—		—	—		—		—		—		—
Food and beverage	—	—		—	—		—	—		—		—		—		—
Other hotel operating expenses	—	—		—	—		—	—		—		—		—		—
Office rental, parking and other expenses	107	—		1,041	—		—	—		—		—		—		—
Other operating expenses:
General and administrative, hotel	—	—		—	—		1	—		1		—		—		—
General and administrative, corporate	—	—		—	—		—	—		—		—		—		—
Property operating costs	—	—		—	—		—	—		—		—		—		—
Depreciation and amortization	2,276	—		1,722	—		449	—		1,459		—		—		—
Property taxes, insurance and other	1,583	—		2,203	—		203	—		216		—		—		—
Loss on asset impairments	—	—		—	—		—	—		—		—		—		—
Operating expenses	3,966	—		4,966	—		653	—		1,676		—		—		—
Equity in income of and interest earned from unconsolidated affiliates, net of impairment charge in 2003	—	—		—	—		—	—		—		—		—		—
Operating income (loss)	852	—		2,698	—		429	—		374		—		—		—
Minority interest	—	—		—	—		—	—		—		—		—		—
Interest expense, net	—	—		—	—		—	—		(1,153	)	—		—		—
(Loss) gain on early extinguishments of debt	—	—		—	—		—	—		—		—		—		—
Equity in income from consolidated entities	—	—		—	—		—	—		—		—		—		—
(Loss) income before income taxes and discontinued operations	852	—		2,698	—		429	—		(779	)	—		—		—
Income tax benefit	—	—		—	—		—	—		—		—		—		—
(Loss) income from continuing operations	852	—		2,698	—		429	—		(779	)	—		—		—
Discontinued operations:
(Loss) income from discontinued operations before income tax	—	(9,925	)	—	(10,327	)	—	(2,614	)	—		(17,432	)	(1,564	)	(929	)
Income tax benefit	—	—		—	—		—	—		—		—		—		—
(Loss) income from discontinued operations	—	(9,925	)	—	(10,327	)	—	(2,614	)	—		(17,432	)	(1,564	)	(929	)
Net income (loss)	852	(9,925	)	2,698	(10,327	)	429	(2,614	)	(779	)	(17,432	)	(1,564	)	(929	)

29

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2003

(Dollars in thousands)

	MeriStar Sub 2D, LLC		MeriStar Sub 4F, L.P.	MeriStar Sub 5K, LLC	MeriStar Sub 5M, LLC	MeriStar Sub 1E, LLC	MeriStar Sub 5O, LLC	MeriStar Sub 4B, L.P.		MeriStar Sub 2C, LLC		MeriStar Sub 4G, L.P.		MeriStar Sub 3B, LLC
Revenue:
Hotel operations:
Rooms	—		—	—	—	—	—	—		—		—		—
Food and beverage	—		—	—	—	—	—	—		—		—		—
Other hotel operations	—		—	—	—	—	—	—		—		—		—
Office rental, parking and other revenue	—		15	—	—	—	—	—		—		—		—
Participating lease revenue	—		1,919	—	1,549	—	709	—		—		—		—
Total revenue	—		1,934	—	1,549	—	709	—		—		—		—
Hotel operating expenses:
Rooms	—		—	—	—	—	—	—		—		—		—
Food and beverage	—		—	—	—	—	—	—		—		—		—
Other hotel operating expenses	—		—	—	—	—	—	—		—		—		—
Office rental, parking and other expenses	—		—	—	—	—	—	—		—		—		—
Other operating expenses:
General and administrative, hotel	—		—	—	—	—	1	—		—		—		—
General and administrative, corporate	—		—	—	—	—	—	—		—		—		—
Property operating costs	—		—	—	—	—	—	—		—		—		—
Depreciation and amortization	—		1,107	—	472	—	228	—		—		—		—
Property taxes, insurance and other	—		344	—	264	—	103	—		—		—		—
Loss on asset impairments	—		—	—	—	—	—	—		—		—		—
Operating expenses	—		1,451	—	736	—	332	—		—		—		—
Equity in income of and interest earned from unconsolidated affiliates, net of impairment charge in 2003	—		—	—	—	—	—	—		—		—		—
Operating income (loss)	—		483	—	813	—	377	—		—		—		—
Minority interest	—		—	—	—	—	—	—		—		—		—
Interest expense, net	—		—	—	—	—	—	—		—		—		—
(Loss) gain on early extinguishments of debt	—		—	—	—	—	—	—		—		—		—
Equity in income from consolidated entities	—		—	—	—	—	—	—		—		—		—
(Loss) income before income taxes and discontinued operations	—		483	—	813	—	377	—		—		—		—
Income tax benefit	—		—	—	—	—	—	—		—		—		—
(Loss) income from continuing operations	—		483	—	813	—	377	—		—		—		—
Discontinued operations:
(Loss) income from discontinued operations before income tax	(9,171	)	—	593	—	8,205	—	(1,275	)	(17,784	)	(11,178	)	(1,245	)
Income tax benefit	—		—	—	—	—	—	—		—		—		—
(Loss) income from discontinued operations	(9,171	)	—	593	—	8,205	—	(1,275	)	(17,784	)	(11,178	)	(1,245	)
Net income (loss)	(9,171	)	483	593	813	8,205	377	(1,275	)	(17,784	)	(11,178	)	(1,245	)

30

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2003

(Dollars in thousands)

	MeriStar Sub 5G, L.P.	MeriStar Sub 5P, LLC	MeriStar Sub 5J, LLC		MeriStar Sub 5Q, LLC	MeriStar Sub 5A, LLC		MeriStar Sub 8D, LLC		MeriStar Sub 4J, LLC	MeriStar Sub 6I, LLC	MeriStar Sub 5I, LLC	CapStar Cherry Hill Company, LLC
Revenue:
Hotel operations:
Rooms	—	—	—		—	—		—		—	—	—	—
Food and beverage	—	—	—		—	—		—		—	—	—	—
Other hotel operations	—	—	—		—	—		—		—	—	—	—
Office rental, parking and other revenue	48	38	9		—	116		—		225	—	—	—
Participating lease revenue	9,844	1,106	8,662		1,820	5,729		—		3,010	—	—	—
Total revenue	9,892	1,144	8,671		1,820	5,845		—		3,235	—	—	—
Hotel operating expenses:
Rooms	—	—	—		—	—		—		—	—	—	—
Food and beverage	—	—	—		—	—		—		—	—	—	—
Other hotel operating expenses	—	—	—		—	—		—		—	—	—	—
Office rental, parking and other expenses	—	—	—		—	—		—		503	—	—	—
Other operating expenses:
General and administrative, hotel	—	—	—		—	1		—		—	—	—	—
General and administrative, corporate	—	—	—		—	—		—		—	—	—	—
Property operating costs	—	—	—		—	—		—		—	—	—	—
Depreciation and amortization	6,290	5	3,483		560	1,291		—		1,270	—	—	—
Property taxes, insurance and other	1,911	7	1,466		215	707		—		310	—	—	—
Loss on asset impairments	—	—	—		—	—		—		—	—	—	—
Operating expenses	8,201	12	4,949		775	1,999		—		2,083	—	—	—
Equity in income of and interest earned from unconsolidated affiliates, net of impairment charge in 2003	—	—	—		—	—		—		—	—	—	—
Operating income (loss)	1,691	1,132	3,722		1,045	3,846		—		1,152	—	—	—
Minority interest	—	—	—		—	—		—		—	—	—	—
Interest expense, net	—	—	(3	)	—	(2,833	)	—		—	—	—	—
(Loss) gain on early extinguishments of debt	—	—	—		—	—		—		—	—	—	—
Equity in income from consolidated entities	—	—	—		—	—		—		—	—	—	—
(Loss) income before income taxes and discontinued operations	1,691	1,132	3,719		1,045	1,013		—		1,152	—	—	—
Income tax benefit	—	—	—		—	—		—		—	—	—	—
(Loss) income from continuing operations	1,691	1,132	3,719		1,045	1,013		—		1,152	—	—	—
Discontinued operations:
(Loss) income from discontinued operations before income tax	—	—	—		—	—		(15,069	)	—	—	—	—
Income tax benefit	—	—	—		—	—		—		—	—	—	—
(Loss) income from discontinued operations	—	—	—		—	—		(15,069	)	—	—	—	—
Net income (loss)	1,691	1,132	3,719		1,045	1,013		(15,069	)	1,152	—	—	—

31

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2003

(Dollars in thousands)

	Meristar Acquisition Company, LLC	MeriStar Sub 6A, LLC	MeriStar Sub 6F, LLC	MeriStar Hotel Lessee, Inc.		Guarantor Subsidiaries Total		Eliminations		Total Consolidated
Revenue:
Hotel operations:
Rooms	—	—	—	488,883		488,883		—		$	488,883
Food and beverage	—	—	—	200,795		200,795		—			200,795
Other hotel operations	—	—	—	61,657		61,657		—			61,657
Office rental, parking and other revenue	—	—	—	(555	)	2,724		—			6,276
Participating lease revenue	—	—	—	554		94,957		(225,095	)		—
Total revenue	—	—	—	751,334		849,016		(225,095	)		757,611
Hotel operating expenses:
Rooms	—	—	—	123,479		123,479		—			123,479
Food and beverage	—	—	—	145,691		145,691		—			145,691
Other hotel operating expenses	—	—	—	36,429		36,429		—			36,429
Office rental, parking and other expenses	—	—	—	—		1,651		—			2,798
Other operating expenses:
General and administrative, hotel	—	—	—	119,979		119,991		—			120,002
General and administrative, corporate	—	—	—	—		—		—			11,913
Property operating costs	—	—	—	116,448		116,448		—			113,995
Depreciation and amortization	—	—	—	1,069		37,300		—			93,506
Property taxes, insurance and other	—	—	—	233,877		251,021		(225,095	)		61,237
Loss on asset impairments	—	—	—	—		11,768		—			27,334
Operating expenses	—	—	—	776,972		843,778		(225,095	)		736,384
Equity in income of and interest earned from unconsolidated affiliates, net of impairment charge in 2003	—	—	—	—		—		—			(17,631	)
Operating income (loss)	—	—	—	(25,638	)	5,238		—			3,596
Minority interest	—	—	—	—		—		—			62
Interest expense, net	—	—	—	(2,930	)	(6,932	)	—			(140,623	)
(Loss) gain on early extinguishments of debt	—	—	—	—		—		—			4,085
Equity in income from consolidated entities	—	—	—	—		—		270,566			—
(Loss) income before income taxes and discontinued operations	—	—	—	(28,568	)	(1,694	)	270,566			(132,880	)
Income tax benefit	—	—	—	—		—		—			3,689
(Loss) income from continuing operations	—	—	—	(28,568	)	(1,694	)	270,566			(129,191	)
Discontinued operations:						—
(Loss) income from discontinued operations before income tax	—	—	—	(26,981	)	(180,039	)	—			(275,313	)
Income tax benefit	—	—	—	—		—		—			67
(Loss) income from discontinued operations	—	—	—	(26,981	)	(180,039	)	—			(275,246	)
Net income (loss)	—	—	—	(55,549	)	(181,733	)	270,566		$	(404,437	)

32

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2002

(Dollars in thousands)

	MeriStar Hospitality OP, L.P.			Non- Guarantor Subsidiaries		MeriStar Sub 7C, LLC	AGH Upreit LLC	MeriStar Sub 5N, LLC	MeriStar Sub 8A, LLC		MeriStar Sub 8F, L.P.	MeriStar Sub 8G, LLC	MeriStar Sub 6H, L.P.	MeriStar Sub 8B, LLC
Revenue:
Hotel operations:
Rooms	$	—		—		—	—	—	—		—	—	—	—
Food and beverage		—		—		—	—	—	—		—	—	—	—
Other hotel operations		—		—		—	—	—	—		—	—	—	—
Office rental, parking and other revenue		(1	)	7,069		—	—	—	—		—	—	—	—
Participating lease revenue		—		124,061		—	—	877	—		2,282	—	1,472	7,078
Total revenue		(1	)	131,130		—	—	877	—		2,282	—	1,472	7,078
Hotel operating expenses:
Rooms		—		—		—	—	—	—		—	—	—	—
Food and beverage		—		—		—	—	—	—		—	—	—	—
Other hotel operating expenses		—		—		—	—	—	—		—	—	—	—
Office rental, parking and other expenses		—		1,895		—	—	—	—		—	—	—	—
Other operating expenses:
General and administrative, hotel		—		6		—	—	—	—		1	—	1	1
General and administrative, corporate		7,643		—		—	—	—	—		—	—	—	—
Property operating costs		3,282		—		—	—	—	—		—	—	—	—
Depreciation and amortization		13,433		42,461		—	—	133	—		453	—	431	2,385
Property taxes, insurance and other		(6,039	)	28,578		—	—	104	—		733	—	101	1,414
Write down of note receivable with Interstate Hotels & Resorts		14,517		—		—	—	—	—		—	—	—	—
Operating expenses		32,836		72,940		—	—	237	—		1,187	—	533	3,800
Equity in income of and interest earned from unconsolidated affiliates		7,608		—		—	—	—	—		—	—	—	—
Operating income (loss)		(25,229	)	58,190		—	—	640	—		1,095	—	939	3,278
Minority interest		15		—		—	—	—	—		—	—	—	—
Interest expense, net		(107,089	)	(25,777	)	—	—	6	—		11	—	3	78
Change in fair value of non-hedging derivatives, net of swap payments		(4,446	)	—		—	—	—	—		—	—	—	—
Loss on fair value of non-hedging derivatives		(4,735	)	—		—	—	—	—		—	—	—	—
Equity in income from consolidated entities		(33,753	)	—		—	—	—	—		—	—	—	—
(Loss) income before income taxes and discontinued operations		(175,237	)	32,413		—	—	646	—		1,106	—	942	3,356
Income tax benefit		1,331		—		—	—	—	—		—	—	—	—
(Loss) income from continuing operations		(173,906	)	32,413		—	—	646	—		1,106	—	942	3,356
Discontinued operations:
(Loss) income from discontinued operations before income tax		3,147		(35,256	)	—	—	—	(4,107	)	—	—	—	—
Income tax benefit		590		—		—	—	—	—		—	—	—	—
(Loss) income from discontinued operations		3,737		(35,256	)	—	—	—	(4,107	)	—	—	—	—
Net income (loss)	$	(170,169	)	(2,843	)	—	—	646	(4,107	)	1,106	—	942	3,356

33

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2002

(Dollars in thousands)

	MeriStar Sub 1C, LLC		MeriStar Sub 8E, LLC	MeriStar Sub 7F, LLC	MeriStar Sub 5L, LLC	MeriStar Sub 3C, LLC	MeriStar Sub 5R, LLC	Old MeriStar Sub 8A, LLC	MeriStar Sub 6D, LLC	MeriStar Sub 6E, LLC	MeriStar Sub 4E, L.P.
Revenue:
Hotel operations:
Rooms	—		—	—	—	—	—	—	—	—	—
Food and beverage	—		—	—	—	—	—	—	—	—	—
Other hotel operations	—		—	—	—	—	—	—	—	—	—
Office rental, parking and other revenue	—		27	—	—	—	—	—	18	—	—
Participating lease revenue	1,245		1,605	1,069	991	1,704	—	—	2,031	5,545	—
Total revenue	1,245		1,632	1,069	991	1,704	—	—	2,049	5,545	—
Hotel operating expenses:
Rooms	—		—	—	—	—	—	—	—	—	—
Food and beverage	—		—	—	—	—	—	—	—	—	—
Other hotel operating expenses	—		—	—	—	—	—	—	—	—	—
Office rental, parking and other expenses	—		—	—	—	—	—	—	—	—	—
Other operating expenses:
General and administrative, hotel	7		1	1	1	1	—	—	1	16	—
General and administrative, corporate	—		—	—	—	—	—	—	—	—	—
Property operating costs	—		—	—	—	—	—	—	—	—	—
Depreciation and amortization	1,021		600	463	135	706	—	—	526	1,692	—
Property taxes, insurance and other	716		187	143	132	458	—	—	203	762	—
Write down of note receivable with Interstate Hotels & Resorts	—		—	—	—	—	—	—	—	—	—
Operating expenses	1,744		788	607	268	1,165	—	—	730	2,470	—
Equity in income of and interest earned from unconsolidated affiliates	—		—	—	—	—	—	—	—	—	—
Operating income (loss)	(499	)	844	462	723	539	—	—	1,319	3,075	—
Minority interest	—		—	—	—	—	—	—	—	—	—
Interest expense, net	41		7	8	10	18	—	—	21	66	—
Change in fair value of non-hedging derivatives, net of swap payments	—		—	—	—	—	—	—	—	—	—
Loss on fair value of non-hedging derivatives	—		—	—	—	—	—	—	—	—	—
Equity in income from consolidated entities	—		—	—	—	—	—	—	—	—	—
(Loss) income before income taxes and discontinued operations	(458	)	851	470	733	557	—	—	1,340	3,141	—
Income tax benefit	—		—	—	—	—	—	—	—	—	—
(Loss) income from continuing operations	(458	)	851	470	733	557	—	—	1,340	3,141	—
Discontinued operations:
(Loss) income from discontinued operations before income tax	—		—	—	—	—	—	—	—	—	83
Income tax benefit	—		—	—	—	—	—	—	—	—	—
(Loss) income from discontinued operations	—		—	—	—	—	—	—	—	—	83
Net income (loss)	(458	)	851	470	733	557	—	—	1,340	3,141	83

34

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2002

(Dollars in thousands)

	MeriStar Sub 1B, LLC	MeriStar Sub 5F, L.P.	MeriStar Sub 6G, LLC	MeriStar Sub 8C, LLC		MeriStar Sub 4C, L.P.		MeriStar Sub 4H, L.P.		MeriStar Sub 7E, LLC	MeriStar Sub 3D, LLC	MeriStar Sub 1A, LLC	MeriStar Sub 5E, LLC
Revenue:
Hotel operations:								��
Rooms	—	—	—	—		—		—		—	—	—	—
Food and beverage	—	—	—	—		—		—		—	—	—	—
Other hotel operations	—	—	—	—		—		—		—	—	—	—
Office rental, parking and other revenue	572	—	—	—		—		—		1	—	—	—
Participating lease revenue	2,312	2,627	2,459	—		—		—		1,346	2,159	1,767	5,540
Total revenue	2,884	2,627	2,459	—		—		—		1,347	2,159	1,767	5,540
Hotel operating expenses:
Rooms	—	—	—	—		—		—		—	—	—	—
Food and beverage	—	—	—	—		—		—		—	—	—	—
Other hotel operating expenses	—	—	—	—		—		—		—	—	—	—
Office rental, parking and other expenses	—	—	—	—		—		—		—	—	—	—
Other operating expenses:
General and administrative, hotel	1	1	1	—		—		—		1	1	1	1
General and administrative, corporate	—	—	—	—		—		—		—	—	—	—
Property operating costs	—	—	—	—		—		—		—	—	—	—
Depreciation and amortization	602	1,058	837	—		—		—		634	849	453	1,943
Property taxes, insurance and other	89	373	335	—		—		—		161	225	392	392
Write down of note receivable with Interstate Hotels & Resorts	—	—	—	—		—		—		—	—	—	—
Operating expenses	692	1,432	1,173	—		—		—		796	1,075	846	2,336
Equity in income of and interest earned from unconsolidated affiliates	—	���	—	—		—		—		—	—	—	—
Operating income (loss)	2,192	1,195	1,286	—		—		—		551	1,084	921	3,204
Minority interest	—	—	—	—		—		—		—	—	—	—
Interest expense, net	21	40	41	—		—		—		17	39	17	28
Change in fair value of non-hedging derivatives, net of swap payments	—	—	—	—		—		—		—	—	—	—
Loss on fair value of non-hedging derivatives	—	—	—	—		—		—		—	—	—	—
Equity in income from consolidated entities	—	—	—	—		—		—		—	—	—	—
(Loss) income before income taxes and discontinued operations	2,213	1,235	1,327	—		—		—		568	1,123	938	3,232
Income tax benefit	—	—	—	—		—		—		—	—	—	—
(Loss) income from continuing operations	2,213	1,235	1,327	—		—		—		568	1,123	938	3,232
Discontinued operations:
(Loss) income from discontinued operations before income tax	—	—	—	(20,129	)	(1,407	)	(145	)	—	—	—	—
Income tax benefit	—	—	—	—		—		—		—	—	—	—
(Loss) income from discontinued operations	—	—	—	(20,129	)	(1,407	)	(145	)	—	—	—	—
Net income (loss)	2,213	1,235	1,327	(20,129	)	(1,407	)	(145	)	568	1,123	938	3,232

35

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2002

(Dollars in thousands)

	MeriStar Sub 7A Joint Venture	MeriStar Sub 6K, LLC	MeriStar Sub 2B, LLC		MeriStar Sub 3A, LLC	MeriStar Sub 4A, L.P.		MeriStar Sub 4D, LLC		MeriStar Sub 2A, LLC		MeriStar Sub 6L, LLC	MDV Limited Partnership	MeriStar Sub 5C, LLC
Revenue:
Hotel operations:
Rooms	—	—	—		—	—		—		—		—	—	—
Food and beverage	—	—	—		—	—		—		—		—	—	—
Other hotel operations	—	—	—		—	—		—		—		—	—	—
Office rental, parking and other revenue	—	—	—		—	—		—		—		—	—	—
Participating lease revenue	—	3,975	—		—	—		—		—		—	503	—
Total revenue	—	3,975	—		—	—		—		—		—	503	—
Hotel operating expenses:
Rooms	—	—	—		—	—		—		—		—	—	—
Food and beverage	—	—	—		—	—		—		—		—	—	—
Other hotel operating expenses	—	—	—		—	—		—		—		—	—	—
Office rental, parking and other expenses	—	—	—		—	—		—		—		—	—	—
Other operating expenses:
General and administrative, hotel	—	—	—		—	—		—		—		—	—	—
General and administrative, corporate	—	—	—		—	—		—		—		—	—	—
Property operating costs	—	—	—		—	—		—		—		—	—	—
Depreciation and amortization	—	736	—		—	— ��		—		—		—	137	—
Property taxes, insurance and other	—	453	—		—	—		—		—		—	122	—
Write down of note receivable with Interstate Hotels & Resorts	—	—	—		—	—		—		—		—	—	—
Operating expenses	—	1,189	—		—	—		—		—		—	259	—
Equity in income of and interest earned from unconsolidated affiliates	—	—	—		—	—		—		—		—	—	—
Operating income (loss)	—	2,786	—		—	—		—		—		—	244	—
Minority interest	—	—	—		—	—		—		—		—	—	—
Interest expense, net	—	33	—		—	—		—		—		—	2	—
Change in fair value of non-hedging derivatives, net of swap payments	—	—	—		—	—		—		—		—	—	—
Loss on fair value of non-hedging derivatives	—	—	—		—	—		—		—		—	—	—
Equity in income from consolidated entities	—	—	—		—	—		—		—		—	—	—
(Loss) income before income taxes and discontinued operations	—	2,819	—		—	—		—		—		—	246	—
Income tax benefit	—	—	—		—	—		—		—		—	—	—
(Loss) income from continuing operations	—	2,819	—		—	—		—		—		—	246	—
Discontinued operations:
(Loss) income from discontinued operations before income tax	638	—	(464	)	195	(2,398	)	(3,591	)	(605	)	658	—	267
Income tax benefit	—	—	—		—	—		—		—		—	—	—
(Loss) income from discontinued operations	638	—	(464	)	195	(2,398	)	(3,591	)	(605	)	658	—	267
Net income (loss)	638	2,819	(464	)	195	(2,398	)	(3,591	)	(605	)	658	246	267

36

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2002

(Dollars in thousands)

	MeriStar Sub 6J, LLC	MeriStar Sub 1D, LLC	MeriStar Sub 7B, L.P.		MeriStar Sub 7D, LLC	MeriStar Sub 7G, LLC		MeriStar Sub 6B, LLC	MeriStar Sub 4I, L.P.		MeriStar Sub 5D, LLC		MeriStar Sub 5H, LLC	MeriStar Sub 7H, LLC
Revenue:
Hotel operations:
Rooms	—	—	—		—	—		—	—		—		—	—
Food and beverage	—	—	—		—	—		—	—		—		—	—
Other hotel operations	—	—	—		—	—		—	—		—		—	—
Office rental, parking and other revenue	—	435	—		1,484	—		—	—		—		—	—
Participating lease revenue	2,387	5,104	—		5,660	—		1,192	—		1,889		—	—
Total revenue	2,387	5,539	—		7,144	—		1,192	—		1,889		—	—
Hotel operating expenses:
Rooms	—	—	—		—	—		—	—		—		—	—
Food and beverage	—	—	—		—	—		—	—		—		—	—
Other hotel operating expenses	—	—	—		—	—		—	—		—		—	—
Office rental, parking and other expenses	—	129	—		1,162	—		—	—		—		—	—
Other operating expenses:
General and administrative, hotel	1	—	—		—	—		1	—		1		—	—
General and administrative, corporate	—	—	—		—	—		—	—		—		—	—
Property operating costs	—	—	—		—	—		—	—		—		—	—
Depreciation and amortization	647	2,286	—		1,660	—		456	—		1,450		—	—
Property taxes, insurance and other	209	1,287	—		2,154	—		226	—		216		—	—
Write down of note receivable with Interstate Hotels & Resorts	—	—	—		—	—		—	—		—		—	—
Operating expenses	857	3,702	—		4,976	—		683	—		1,667		—	—
Equity in income of and interest earned from unconsolidated affiliates	—	—	—		—	—		—	—		—		—	—
Operating income (loss)	1,530	1,837	—		2,168	—		509	—		222		—	—
Minority interest	—	—	—		—	—		—	—		—		—	—
Interest expense, net	34	38	—		40	—		8	—		(1,479	)	—	—
Change in fair value of non-hedging derivatives, net of swap payments	—	—	—		—	—		—	—		—		—	—
Loss on fair value of non-hedging derivatives	—	—	—		—	—		—	—		—		—	—
Equity in income from consolidated entities	—	—	—		—	—		—	—		—		—	—
(Loss) income before income taxes and discontinued operations	1,564	1,875	—		2,208	—		517	—		(1,257	)	—	—
Income tax benefit	—	—	—		—	—		—	—		—		—	—
(Loss) income from continuing operations	1,564	1,875	—		2,208	—		517	—		(1,257	)	—	—
Discontinued operations:
(Loss) income from discontinued operations before income tax	—	—	(6,877	)	—	(393	)	—	(5,445	)	—		615	484
Income tax benefit	—	—	—		—	—		—	—		—		—	—
(Loss) income from discontinued operations	—	—	(6,877	)	—	(393	)	—	(5,445	)	—		615	484
Net income (loss)	1,564	1,875	(6,877	)	2,208	(393	)	517	(5,445	)	(1,257	)	615	484

37

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2002

(Dollars in thousands)

	AGH PSS I, Inc.	MeriStar Sub 2D, LLC		MeriStar Sub 4F, L.P.	MeriStar Sub 5K, LLC	MeriStar Sub 5M, LLC	MeriStar Sub 1E, LLC	MeriStar Sub 5O, LLC	MeriStar Sub 6M Company	MeriStar Sub 4B, L.P.		MeriStar Sub 6C, LLC
Revenue:
Hotel operations:
Rooms	—	—		—	—	—	—	—	—	—		—
Food and beverage	—	—		—	—	—	—	—	—	—		—
Other hotel operations	—	—		—	—	—	—	—	—	—		—
Office rental, parking and other revenue	—	—		12	—	—	—	—	—	—		16
Participating lease revenue	—	—		1,868	—	1,604	—	724	4,279	—		2,946
Total revenue	—	—		1,880	—	1,604	—	724	4,279	—		2,962
Hotel operating expenses:
Rooms	—	—		—	—	—	—	—	—	—		—
Food and beverage	—	—		—	—	—	—	—	—	—		—
Other hotel operating expenses	—	—		—	—	—	—	—	—	—		—
Office rental, parking and other expenses	—	—		—	—	—	—	—	—	—		—
Other operating expenses:
General and administrative, hotel	—	—		—	—	1	—	1	1	—		1
General and administrative, corporate	—	—		—	—	—	—	—	—	—		—
Property operating costs	—	—		—	—	—	—	—	—	—		—
Depreciation and amortization	—	—		1,122	—	454	—	219	1,211	—		777
Property taxes, insurance and other	—	—		383	—	287	—	119	294	—		209
Write down of note receivable with Interstate Hotels & Resorts	—	—		—	—	—	—	—	—	—		—
Operating expenses	—	—		1,505	—	742	—	339	1,506	—		987
Equity in income of and interest earned from unconsolidated affiliates	—	—		—	—	—	—	—	—	—		—
Operating income (loss)	—	—		375	—	862	—	385	2,773	—		1,975
Minority interest	—	—		—	—	—	—	—	—	—		—
Interest expense, net	—	—		37	—	19	—	7	21	—		36
Change in fair value of non-hedging derivatives, net of swap payments	—	—		—	—	—	—	—	—	—		—
Loss on fair value of non-hedging derivatives	—	—		—	—	—	—	—	—	—		—
Equity in income from consolidated entities	—	—		—	—	—	—	—	—	—		—
(Loss) income before income taxes and discontinued operations	—	—		412	—	881	—	392	2,794	—		2,011
Income tax benefit	—	—		—	—	—	—	—	—	—		—
(Loss) income from continuing operations	—	—		412	—	881	—	392	2,794	—		2,011
Discontinued operations:
(Loss) income from discontinued operations before income tax	1,639	(224	)	—	970	—	1,216	—	—	(4,245	)	—
Income tax benefit	—	—		—	—	—	—	—	—	—		—
(Loss) income from discontinued operations	1,639	(224	)	—	970	—	1,216	—	—	(4,245	)	—
Net income (loss)	1,639	(224	)	412	970	881	1,216	392	2,794	(4,245	)	2,011

38

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2002

(Dollars in thousands)

	MeriStar Sub 2C, LLC		MeriStar Sub 4G, L.P.	MeriStar Sub 3B, LLC		MeriStar Sub 5G, L.P.	MeriStar Sub 5P, LLC		MeriStar Sub 5J, LLC	MeriStar Sub 5Q, LLC	MeriStar Sub 5A, LLC		MeriStar Sub 8D, LLC	MeriStar Sub 4J, LLC
Revenue:
Hotel operations:
Rooms	—		—	—		—	—		—	—	—		—	—
Food and beverage	—		—	—		—	—		—	—	—		—	—
Other hotel operations	—		—	—		—	—		—	—	—		—	—
Office rental, parking and other revenue	—		—	—		53	—		—	—	110		—	10
Participating lease revenue	—		—	—		10,316	581		8,641	1,838	5,709		—	3,000
Total revenue	—		—	—		10,369	581		8,641	1,838	5,819		—	3,010
Hotel operating expenses:
Rooms	—		—	—		—	—		—	—	—		—	—
Food and beverage	—		—	—		—	—		—	—	—		—	—
Other hotel operating expenses	—		—	—		—	—		—	—	—		—	—
Office rental, parking and other expenses	—		—	—		—	—		—	—	—		—	—
Other operating expenses:
General and administrative, hotel	—		—	—		2	—		1	1	1		—	5
General and administrative, corporate	—		—	—		—	—		—	—	—		—	—
Property operating costs	—		—	—		—	—		—	—	—		—	—
Depreciation and amortization	—		—	—		6,201	3		3,475	494	1,434		—	1,343
Property taxes, insurance and other	—		—	—		1,861	(11	)	1,537	255	634		—	274
Write down of note receivable with Interstate Hotels & Resorts	—		—	—		—	—		—	—	—		—	—
Operating expenses	—		—	—		8,064	(8	)	5,013	750	2,069		—	1,622
Equity in income of and interest earned from unconsolidated affiliates	—		—	—		—	—		—	—	—		—	—
Operating income (loss)	—		—	—		2,305	589		3,628	1,088	3,750		—	1,388
Minority interest	—		—	—		—	—		—	—	—		—	—
Interest expense, net	—		—	—		124	—		156	76	(2,780	)	—	56
Change in fair value of non-hedging derivatives, net of swap payments	—		—	—		—	—		—	—	—		—	—
Loss on fair value of non-hedging derivatives	—		—	—		—	—		—	—	—		—	—
Equity in income from consolidated entities	—		—	—		—	—		—	—	—		—	—
(Loss) income before income taxes and discontinued operations	—		—	—		2,429	589		3,784	1,164	970		—	1,444
Income tax benefit	—		—	—		—	—		—	—	—		—	—
(Loss) income from continuing operations	—		—	—		2,429	589		3,784	1,164	970		—	1,444
Discontinued operations:
(Loss) income from discontinued operations before income tax	(1,248	)	809	(12,777	)	—	—		—	—	—		651	—
Income tax benefit	—		—	—		—	—		—	—	—		—	—
(Loss) income from discontinued operations	(1,248	)	809	(12,777	)	—	—		—	—	—		651	—
Net income (loss)	(1,248	)	809	(12,777	)	2,429	589		3,784	1,164	970		651	1,444

39

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Operations

Year Ended December 31, 2002

(Dollars in thousands)

	MeriStar Acquisition Company, LLC	MeriStar Sub 6I, LLC	MeriStar Sub 6A, LLC	MeriStar Sub 6F, LLC	MeriStar Sub 5I, LLC	CapStar Cherry Hill Company, LLC	MeriStar Hotel Lessee, Inc.		Guarantor Subsidiaries Total		Eliminations		Total Consolidated
Revenue:
Hotel operations:
Rooms	—	—	—	—	—	—	503,951		503,951		—		$	503,951
Food and beverage	—	—	—	—	—	—	199,148		199,148		—			199,148
Other hotel operations	—	—	—	—	—	—	61,093		61,093		—			61,093
Office rental, parking and other revenue	—	—	—	—	—	—	(1,506	)	1,232		—			8,300
Participating lease revenue	—	—	—	—	—	—	—		106,325		(230,386	)		—
Total revenue	—	—	—	—	—	—	762,686		871,749		(230,386	)		772,492
Hotel operating expenses:
Rooms	—	—	—	—	—	—	120,668		120,668		—			120,668
Food and beverage	—	—	—	—	—	—	141,120		141,120		—			141,120
Other hotel operating expenses	—	—	—	—	—	—	33,297		33,297		—			33,297
Office rental, parking and other expenses	—	—	—	—	—	—	—		1,291		—			3,186
Other operating expenses:
General and administrative, hotel	—	—	—	—	—	—	120,771		120,826		—			120,832
General and administrative, corporate	—	—	—	—	—	—	(1,156	)	(1,156	)	—			6,487
Property operating costs	—	—	—	—	—	—	109,103		109,103		—			112,385
Depreciation and amortization	—	—	—	—	—	—	1,578		40,604		—			96,498
Property taxes, insurance and other	—	—	—	—	—	—	243,613		261,042		(230,386	)		53,195
Write down of note receivable with Interstate Hotels & Resorts	—	—	—	—	—	—	—		—		—			14,517
Operating expenses	—	—	—	—	—	—	768,994		826,795		(230,386	)		702,185
Equity in income of and interest earned from unconsolidated affiliates	—	—	—	—	—	—	—		—		—			7,608
Operating income (loss)	—	—	—	—	—	—	(6,308	)	44,954		—			77,915
Minority interest	—	—	—	—	—	—	—		—		—			15
Interest expense, net	—	—	—	—	—	—	(159	)	(3,259	)	—			(136,125	)
Change in fair value of non-hedging derivatives, net of swap payments	—	—	—	—	—	—	—		—		—			(4,446	)
Loss on fair value of non-hedging derivatives	—	—	—	—	—	—	—		—		—			(4,735	)
Equity in income from consolidated entities	—	—	—	—	—	—	—		—		33,753			—
(Loss) income before income taxes and discontinued operations	—	—	—	—	—	—	(6,467	)	41,695		33,753			(67,376	)
Income tax benefit	—	—	—	—	—	—	—		—		—			1,331
(Loss) income from continuing operations	—	—	—	—	—	—	(6,467	)	41,695		33,753			(66,045	)
Discontinued operations:
(Loss) income from discontinued operations before income tax	—	—	—	—	—	—	(17,425	)	(73,255	)	—			(105,364	)
Income tax benefit	—	—	—	—	—	—	—		—		—			590
(Loss) income from discontinued operations	—	—	—	—	—	—	(17,425	)	(73,255	)	—			(104,774	)
Net income (loss)	—	—	—	—	—	—	(23,892	)	(31,560	)	33,753		$	(170,819	)

40

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2004 (Dollars in thousands)

	MeriStar Hospitality OP, L.P.			Non- Guarantor Subsidiaries		MeriStar Lexington Mortgage, LLC		MeriStar Lexington Partners, LLC		MeriStar Sub 7C, LLC	MeriStar Sub 8G, LLC	AGH Upreit LLC	MeriStar Sub 6H, L.P.		MeriStar Sub 8F, L.P.		MeriStar Sub 8B, LLC
Operating activities:
Net income (loss)	$	(99,133	)	31,170		1,439		237		—	—	—	561		1,155		6,133
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization		7,964		52,829		—		—		—	—	—	627		658		2,483
Loss on asset impairments		—		5,556		—		—		—	—	—	—		—		—
Loss on sale of assets, before tax effect		—		3,099		—		—		—	—	—	—		—		—
Loss on early extinguishments of debt		7,967		—		—		—		—	—	—	—		—		—
Minority interests		(79	)	—		—		—		—	—	—	—		—		—
Equity in income of unconsolidated affiliates		3,957		—		—		(237	)	—	—	—	—		—		—
Cash distributions from equity method of investment		—		—		—		840		—	—	—	—		—		—
Amortization of unearned stock-based compensation		(2,939	)	—		—		—		—	—	—	—		—		—
Redemption of POPs		(4,602	)	—		—		—		—	—	—	—		—		—
Deferred income taxes		(730	)	—		—		—		—	—	—	—		—		—
Changes in operating assets and liabilities:
Accounts receivable		(21,593	)	1,078		(740	)	—		—	—	—	—		—		—
Prepaid expenses and other assets		(442	)	2,229		—		—		—	—	—	12		53		75
Due from/to Interstate Hotels & Resorts		(8,096	)	—		—		—		—	—	—	—		—		—
Accounts payable, accrued expenses, accrued interest and other liabilities		(12,813	)	(510	)	—		—		—	—	—	(161	)	(61	)	(2,502	)
Due from/to subsidiaries		150,751		(40,661	)	(699	)	(840	)	—	—	—	(1,016	)	266		(461	)
Net cash provided by (used in) operating activities		20,212		54,790		—		—		—	—	—	23		2,071		5,728
Investing activities:
Acquisition of hotels, net of cash acquired of $4.1 million		—		(91,251	)	—		—		—	—	—	—		—		—
Capital expenditures for property and equipment		(3,334	)	(67,351	)	—		—		—	—	—	(23	)	(2,186	)	(5,728	)
Investment in and advance to Radisson Lexington Avenue Hotel		(50,493	)	—		—		—		—	—	—	—		—		—
Proceeds from sales of assets		—		51,675		—		—		—	—	—	—		—		—
(Increase) decrease in restricted cash		(15,822	)	1,130		—		—		—	—	—	—		115		—
Costs associated with disposition program and other, net		85		(2,021	)	—		—		—	—	—	—		—		—
Net cash (used in) provided by investing activities		(69,564	)	(107,818	)	—		—		—	—	—	(23	)	(2,071	)	(5,728	)
Financing activities:
Prepayments on long-term debt		(85,318	)	—		—		—		—	—	—	—		—		—
Scheduled payments on long-term debt		(11,234	)	(1,811	)	—		—		—	—	—	—		—		—
Proceeds from issuance of long-term debt		(397	)	54,839		—		—		—	—	—	—		—		—
Loans to/from subsidiaries		(93,067	)	—		—		—		—	—	—	—		—		—
Contributions from partners		72,296		—		—		—		—	—	—	—		—		—
Distributions to minority investors		(141	)	—		—		—		—	—	—	—		—		—
Purchase of limited partnership unit		(8,854	)	—		—		—		—	—	—	—		—		—
Net cash provided by (used in) financing activities		(126,715	)	53,028		—		—		—	—	—	—		—		—
Effect of exchange rate changes on cash and cash equivalents		(1,355	)	—		—		—		—	—	—	—		—		—
Net (decrease) increase in cash and cash equivalents		(177,422	)	—		—		—		—	—	—	—		—		—
Cash and cash equivalents, beginning of year		218,646		—		—		—		—	—	—	—		—		—
Cash and cash equivalents, end of year	$	41,224		—		—		—		—	—	—	—		—		—

41

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2004 (Dollars in thousands)

	MeriStar Sub 1C, LLC		MeriStar Sub 8E, LLC		MeriStar Sub 7F, LLC		MeriStar Sub 5L, LLC		MeriStar Sub 3C, LLC		MeriStar Sub 5R, LLC	MeriStar Sub 8A, LLC	MeriStar Sub 6D, LLC		MeriStar Sub 6E, LLC		MeriStar Sub 4E, L.P.
Operating activities:
Net income (loss)	(936	)	722		486		596		834		—	—	1,385		3,797		(1,058	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	1,419		594		316		155		698		—	—	484		1,596		254
Loss on asset impairments	—		—		—		—		—		—	—	—		—		1,021
Loss on sale of assets, before tax effect	—		—		—		—		—		—	—	—		—		1,219
Loss on early extinguishments of debt	—		—		—		—		—		—	—	—		—		—
Minority interests	—		—		—		—		—		—	—	—		—		—
Equity in income of unconsolidated affiliates	—		—		—		—		—		—	—	—		—		—
Cash distributions from equity method of investment	—		—		—		—		—		—	—	—		—		—
Amortization of unearned stock-based compensation	—		—		—		—		—		—	—	—		—		—
Redemption of POPs	—		—		—		—		—		—	—	—		—		—
Deferred income taxes	—		—		—		—		—		—	—	—		—		—
Changes in operating assets and liabilities:
Accounts receivable	—		—		—		—		—		—	—	(21	)	—		(64	)
Prepaid expenses and other assets	102		16		11		53		26		—	—	14		60		(17	)
Due from/to Interstate Hotels & Resorts	—		—		—		—		—		—	—	—		—		—
Accounts payable, accrued expenses, accrued interest and other liabilities	(29	)	32		(55	)	16		71		—	—	(59	)	188		(346	)
Due from/to subsidiaries	288		(829	)	1,983		(170	)	(1,545	)	—	—	(885	)	(825	)	(4,050	)
Net cash provided by (used in) operating activities	844		535		2,741		650		84		—	—	918		4,816		(3,041	)
Investing activities:
Acquisition of hotels, net of cash acquired of $4.1 million	—		—		—		—		—		—	—	—		—		—
Capital expenditures for property and equipment	(844	)	(535	)	(2,741	)	(650	)	(84	)	—	—	(918	)	(4,816	)	(61	)
Investment in and advance to Radisson Lexington Avenue Hotel	—		—		—		—		—		—	—	—		—		—
Proceeds from sales of assets	—		—		—		—		—		—	—	—		—		3,400
(Increase) decrease in restricted cash	—		—		—		—		—		—	—	—		—		—
Costs associated with disposition program and other, net	—		—		—		—		—		—	—	—		—		(298	)
Net cash (used in) provided by investing activities	(844	)	(535	)	(2,741	)	(650	)	(84	)	—	—	(918	)	(4,816	)	3,041
Financing activities:
Prepayments on long-term debt	—		—		—		—		—		—	—	—		—		—
Scheduled payments on long-term debt	—		—		—		—		—		—	—	—		—		—
Proceeds from issuance of long-term debt	—		—		—		—		—		—	—	—		—		—
Loans to/from subsidiaries	—		—		—		—		—		—	—	—		—		—
Contributions from partners	—		—		—		—		—		—	—	—		—		—
Distributions to minority investors	—		—		—		—		—		—	—	—		—		—
Purchase of limited partnership unit	—		—		—		—		—		—	—	—		—		—
Net cash provided by (used in) financing activities	—		—		—		—		—		—	—	—		—		—
Effect of exchange rate changes on cash and cash equivalents	—		—		—		—		—		—	—	—		—		—
Net (decrease) increase in cash and cash equivalents	—		—		—		—		—		—	—	—		—		—
Cash and cash equivalents, beginning of year	—		—		—		—		—		—	—	—		—		—
Cash and cash equivalents, end of year	—		—		—		—		—		—	—	—		—		—

42

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2004 (Dollars in thousands)

	MeriStar Sub 1B, LLC		MeriStar Sub 5F, L.P.		MeriStar Sub 6G, LLC			MeriStar Sub 8C, LLC		MeriStar Sub 4C, L.P.	MeriStar Sub 4H, L.P.		MeriStar Sub 7E, LLC		MeriStar Sub 3D, LLC		MeriStar Sub 1A, LLC		MeriStar Sub 7A Joint Venture
Operating activities:
Net income (loss)	1,448		824		2,416			(61	)	—	(403	)	529		568		(1,958	)	(732	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	493		772		724			—		—	43		651		703		279		121
Loss on asset impairments	—		—		—			—		—	—		—		—		2,871		1,005
Loss on sale of assets, before tax effect	—		—		—			1,577		—	980		—		—		—		55
Loss on early extinguishments of debt	—		—		—			—		—	—		—		—		—		—
Minority interests	—		—		—			—		—	—		—		—		—		—
Equity in income of unconsolidated affiliates	—		—		—			—		—	—		—		—		—		—
Cash distributions from equity method of investment	—		—		—			—		—	—		—		—		—		—
Amortization of unearned stock-based compensation	—		—		—			—		—	—		—		—		—		—
Redemption of POPs	—		—		—			—		—	—		—		—		—		—
Deferred income taxes	—		—		—			—		—	—		—		—		—		—
Changes in operating assets and liabilities:
Accounts receivable	—		—		—			—		—	—		—		—		—		44
Prepaid expenses and other assets	51		115		23			117		—	(8	)	14		27		40		1
Due from/to Interstate Hotels & Resorts	—		—		—			—		—	—		—		—		—		—
Accounts payable, accrued expenses, accrued interest and other liabilities	(46	)	(101	)	130			306		—	(178	)	14		(30	)	19		(150	)
Due from/to subsidiaries	(198	)	5,598		(1,704	)		(6,824	)	—	(4,883	)	341		(964	)	(1,190	)	(4,966	)
Net cash provided by (used in) operating activities	1,748		7,208		1,589			(4,885	)	—	(4,449	)	1,549		304		61		(4,622	)
Investing activities:
Acquisition of hotels, net of cash acquired of $4.1 million	—		—		—			—		—	—		—		—		—		—
Capital expenditures for property and equipment	(1,748	)	(7,208	)	(1,589	)		(2	)	—	(10	)	(1,549	)	(304	)	(61	)	(23	)
Investment in and advance to Radisson Lexington Avenue Hotel	—		—		—			—		—	—		—		—		—		—
Proceeds from sales of assets	—		—		—			5,000		—	4,650		—		—		—		4,850
(Increase) decrease in restricted cash	—		—		—			—		—	—		—		—		—		—
Costs associated with disposition program and other, net	—		—		—			(113	)	—	(191	)	—		—		—		(205	)
Net cash (used in) provided by investing activities	(1,748	)	(7,208	)	(1,589	)		4,885		—	4,449		(1,549	)	(304	)	(61	)	4,622
Financing activities:
Prepayments on long-term debt	—		—		—			—		—	—		—		—		—		—
Scheduled payments on long-term debt	—		—		—			—		—	—		—		—		—		—
Proceeds from issuance of long-term debt	—		—		—			—		—	—		—		—		—		—
Loans to/from subsidiaries	—		—		—			—		—	—		—		—		—		—
Contributions from partners	—		—		—			—		—	—		—		—		—		—
Distributions to minority investors	—		—		—			—		—	—		—		—		—		—
Purchase of limited partnership unit	—		—		—			—		—	—		—		—		—		—
Net cash provided by (used in) financing activities	—		—		—			—		—	—		—		—		—		—
Effect of exchange rate changes on cash and cash equivalents	—		—		—		��	—		—	—		—		—		—		—
Net (decrease) increase in cash and cash equivalents	—		—		—			—		—	—		—		—		—		—
Cash and cash equivalents, beginning of year	—		—		—			—		—	—		—		—		—		—
Cash and cash equivalents, end of year	—		—		—			—		—	—		—		—		—		—

43

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2004 (Dollars in thousands)

	MeriStar Sub 2B, LLC		MeriStar Sub 3A, LLC		MeriStar Sub 4A, LP		MeriStar Sub 4D, LLC		MeriStar Sub 2A, LLC		MeriStar Sub 6L, LLC		MDV Limited Partnership		MeriStar Sub 5C, LLC	MeriStar Sub 6J, LLC		MeriStar Sub 1D, LLC
Operating activities:
Net income (loss)	—		89		97		—		—		1,852		295		—	1,798		1,457
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	—		43		—		—		—		—		154		—	556		2,286
Loss on asset impairments	—		—		—		—		—		—		—		—	—		—
Loss on sale of assets, before tax effect	—		20		470		—		—		(937	)	—		—	—		—
Loss on early extinguishments of debt	—		—		—		—		—		—		—		—	—		—
Minority interests	—		—		—		—		—		—		—		—	—		—
Equity in income of unconsolidated affiliates	—		—		—		—		—		—		—		—	—		—
Cash distributions from equity method of investment	—		—		—		—		—		—		—		—	—		—
Amortization of unearned stock-based compensation	—		—		—		—		—		—		—		—	—		—
Redemption of POPs	—		—		—		—		—		—		—		—	—		—
Deferred income taxes	—		—		—		—		—		—		—		—	—		—
Changes in operating assets and liabilities:
Accounts receivable	2,345		—		—		—		2,002		(178	)	—		—	—		—
Prepaid expenses and other assets	—		1		(9	)	3		—		15		20		—	29		341
Due from/to Interstate Hotels & Resorts	—		—		—		—		—		—		—		—	—		—
Accounts payable, accrued expenses, accrued interest and other liabilities	8		(161	)	(342	)	—		8		(25	)	(21	)	—	275		91
Due from/to subsidiaries	(2,353	)	(3,051	)	(3,528	)	(3	)	(2,010	)	(15,033	)	(343	)	—	(2,212	)	(3,349	)
Net cash provided by (used in) operating activities	—		(3,059	)	(3,312	)	—		—		(14,306	)	105		—	446		826
Investing activities:
Acquisition of hotels, net of cash acquired of $4.1 million	—		—		—		—		—		—		—		—	—		—
Capital expenditures for property and equipment	—		—		(9	)	—		—		—		(105	)	—	(446	)	(826	)
Investment in and advance to Radisson Lexington Avenue Hotel	—		—		—		—		—		—		—		—	—		—
Proceeds from sales of assets	—		3,300		3,575		—		—		14,775		—		—	—		—
(Increase) decrease in restricted cash	—		—		—		—		—		—		—		—	—		—
Costs associated with disposition program and other, net	—		(241	)	(254	)	—		—		(469	)	—		—	—		—
Net cash (used in) provided by investing activities	—		3,059		3,312		—		—		14,306		(105	)	—	(446	)	(826	)
Financing activities:
Prepayments on long-term debt	—		—		—		—		—		—		—		—	—		—
Scheduled payments on long-term debt	—		—		—		—		—		—		—		—	—		—
Proceeds from issuance of long-term debt	—		—		—		—		—		—		—		—	—		—
Loans to/from subsidiaries	—		—		—		—		—		—		—		—	—		—
Contributions from partners	—		—		—		—		—		—		—		—	—		—
Distributions to minority investors	—		—		—		—		—		—		—		—	—		—
Purchase of limited partnership unit	—		—		—		—		—		—		—		—	—		—
Net cash provided by (used in) financing activities	—		—		—		—		—		—		���		—	—		—
Effect of exchange rate changes on cash and cash equivalents	—		—		—		—		—		—		—		—	—		—
Net (decrease) increase in cash and cash equivalents	—		—		—		—		—		—		—		—	—		—
Cash and cash equivalents, beginning of year	—		—		—		—		—		—		—		—	—		—
Cash and cash equivalents, end of year	—		—		—		—		—		—		—		—	—		—

44

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2004 (Dollars in thousands)

	MeriStar Sub 7B, L.P.		MeriStar Sub 7D, LLC		MeriStar Sub 7G, LLC		MeriStar Sub 6B, LLC		MeriStar Sub 4I, L.P.		MeriStar Sub 5D, LLC		MeriStar Sub 5H, LLC		MeriStar Sub 7H, LLC		AGH PSS I, Inc.		MeriStar Sub 2D, LLC
Operating activities:
Net income (loss)	(787	)	3,878		103		489		—		(804	)	—		—		—		—
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	99		1,572		49		448		—		1,432		—		—		—		—
Loss on asset impairments	—		—		—		—		—		—		—		—		—		—
Loss on sale of assets, before tax effect	1,558		—		544		—		—		—		—		—		—		—
Loss on early extinguishments of debt	—		—		—		—		—		—		—		—		—		—
Minority interests	—		—		—		—		—		—		—		—		—		—
Equity in income of unconsolidated affiliates	—		—		—		—		—		—		—		—		—		—
Cash distributions from equity method of investment	—		—		—		—		—		—		—		—		—		—
Amortization of unearned stock-based compensation	—		—		—		—		—		—		—		—		—		—
Redemption of POPs	—		—		—		—		—		—		—		—		—		—
Deferred income taxes	—		—		—		—		—		—		—		—		—		—
Changes in operating assets and liabilities:
Accounts receivable	—		157		—		—		—		—		46		43		—		1,166
Prepaid expenses and other assets	1		146		—		9		—		60		1		—		1		—
Due from/to Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
Accounts payable, accrued expenses, accrued interest and other liabilities	(1,080	)	(1,788	)	6		(18	)	61		153		2		—		—		1
Due from/to subsidiaries	(3,835	)	(1,301	)	(2,625	)	148		(61	)	(479	)	(49	)	(43	)	303		(1,167	)
Net cash provided by (used in) operating activities	(4,044	)	2,664		(1,923	)	1,076		—		362		—		—		304		—
Investing activities:
Acquisition of hotels, net of cash acquired of $4.1 million	—		—		—		—		—		—		—		—		—		—
Capital expenditures for property and equipment	(51	)	(2,664	)	(16	)	(1,076	)	—		(362	)	—		—		(304	)	—
Investment in and advance to Radisson Lexington Avenue Hotel	—		—		—		—		—		—		—		—		—		—
Proceeds from sales of assets	4,500		—		2,300		—		—		—		—		—		—		—
(Increase) decrease in restricted cash	—		—		—		—		—		—		—		—		—		—
Costs associated with disposition program and other, net	(405	)	—		(361	)	—		—		—		—		—		—		—
Net cash (used in) provided by investing activities	4,044		(2,664	)	1,923		(1,076	)	—		(362	)	—		—		(304	)	—
Financing activities:
Prepayments on long-term debt	—		—		—		—		—		—		—		—		—		—
Scheduled payments on long-term debt	—		—		—		—		—		—		—		—		—		—
Proceeds from issuance of long-term debt	—		—		—		—		—		—		—		—		—		—
Loans to/from subsidiaries	—		—		—		—		—		—		—		—		—		—
Contributions from partners	—		—		—		—		—		—		—		—		—		—
Distributions to minority investors	—		—		—		—		—		—		—		—		—		—
Purchase of limited partnership unit	—		—		—		—		—		—		—		—		—		—
Net cash provided by (used in) financing activities	—		—		—		—		—		—		—		—		—		—
Effect of exchange rate changes on cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
Net (decrease) increase in cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, beginning of year	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, end of year	—		—		—		—		—		—		—		—		—		—

45

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2004 (Dollars in thousands)

	MeriStar Sub 4F, L.P.		MeriStar Sub 5K, LLC		MeriStar Sub 5M, LLC		MeriStar Sub 1E, LLC		MeriStar Sub 5O, LLC		MeriStar Sub 4B, L.P.		MeriStar Sub 2C, LLC		MeriStar Sub 4G, L.P.		MeriStar Sub 3B, LLC		MeriStar Sub 5G, L.P.
Operating activities:
Net income (loss)	503		1,835		483		—		237		(217	)	(2,242	)	(373	)	—		2,514
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	1,114		1,247		423		—		210		—		—		424		—		6,364
Loss on asset impairments	—		—		—		—		—		—		903		981		—		—
Loss on sale of assets, before tax effect	—		(1,372	)	—		—		—		964		3,338		460		—		—
Loss on early extinguishments of debt	—		—		—		—		—		—		—		—		—		—
Minority interests	—		—		—		—		—		—		—		—		—		—
Equity in income of unconsolidated affiliates	—		—		—		—		—		—		—		—		—		—
Cash distributions from equity method of investment	—		—		—		—		—		—		—		—		—		—
Amortization of unearned stock-based compensation	—		—		—		—		—		—		—		—		—		—
Redemption of POPs	—		—		—		—		—		—		—		—		—		—
Deferred income taxes	—		—		—		—		—		—		—		—		—		—
Changes in operating assets and liabilities:
Accounts receivable	—		—		—		198		—		—		—		—		—		—
Prepaid expenses and other assets	23		(74	)	70		(1	)	24		(4	)	(240	)	(89	)	(3	)	139
Due from/to Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
Accounts payable, accrued expenses, accrued interest and other liabilities	(36	)	(3,028	)	—		(14	)	8		(410	)	(257	)	(488	)	—		(775	)
Due from/to subsidiaries	1,122		(22,788	)	(332	)	(183	)	(115	)	(7,329	)	10,489		(8,117	)	3		1,256
Net cash provided by (used in) operating activities	2,726		(24,180	)	644		—		364		(6,996	)	11,991		(7,202	)	—		9,498
Investing activities:
Acquisition of hotels, net of cash acquired of $4.1 million	—		—		—		—		—		—		—		—		—		—
Capital expenditures for property and equipment	(2,726	)	(64	)	(644	)	—		(364	)	(22	)	(2	)	(4	)	—		(9,498	)
Investment in and advance to Radisson Lexington Avenue Hotel	—		—		—		—		—		—		—		—		—		—
Proceeds from sales of assets	—		25,000		—		—		—		7,500		8,398		7,975		—		—
(Increase) decrease in restricted cash	—		—		—		—		—		—		—		—		—		—
Costs associated with disposition program and other, net	—		(756	)	—		—		—		(482	)	(656	)	(769	)	—		—
Net cash (used in) provided by investing activities	(2,726	)	24,180		(644	)	—		(364	)	6,996		7,740		7,202		—		(9,498	)
Financing activities:
Prepayments on long-term debt	—		—		—		—		—		—		(19,731	)	—		—		—
Scheduled payments on long-term debt	—		—		—		—		—		—		—		—		—		—
Proceeds from issuance of long-term debt	—		—		—		—		—		—		—		—		—		—
Loans to/from subsidiaries	—		—		—		—		—		—		—		—		—		—
Contributions from partners	—		—		—		—		—		—		—		—		—		—
Distributions to minority investors	—		—		—		—		—		—		—		—		—		—
Purchase of limited partnership unit	—		—		—		—		—		—		—		—		—		—
Net cash provided by (used in) financing activities	—		—		—		—		—		—		(19,731	)	—		—		—
Effect of exchange rate changes on cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
Net (decrease) increase in cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, beginning of year	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, end of year	—		—		—		—		—		—		—		—		—		—

46

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2004 (Dollars in thousands)

	MeriStar Sub 5N, LLC			MeriStar Sub 5P, LLC		MeriStar Sub 5J, LLC		MeriStar Sub 5Q, LLC		MeriStar Sub 5A, LLC		MeriStar Sub 8D, LLC		MeriStar Sub 4J, LLC		MeriStar Pentagon City, LLC		MeriStar Sub 6K, LLC	MeriStar Sub 5E, LLC
Operating activities:
Net income (loss)	370			625		(43	)	498		1,410		(857	)	950		(161	)	—	—
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	123			5		5,171		565		1,081		—		1,272		3,515		—	—
Loss on asset impairments	—			—		—		—		—		—		—		—		—	—
Loss on sale of assets, before tax effect	—			—		—		—		—		2,090		—		—		—	—
Loss on early extinguishments of debt	—			—		—		—		—		—		—		—		—	—
Minority interests	—			—		—		—		—		—		—		—		—	—
Equity in income of unconsolidated affiliates	—			—		—		—		—		—		—		—		—	—
Cash distributions from equity method of investment	—			—		—		—		—		—		—		—		—	—
Amortization of unearned stock-based compensation	—			—		—		—		—		—		—		—		—	—
Redemption of POPs	—			—		—		—		—		—		—		—		—	—
Deferred income taxes	—			—		—		—		—		—		—		—		—	—
Changes in operating assets and liabilities:
Accounts receivable	—			—		—		—		—		(359	)	1		2,421		—	—
Prepaid expenses and other assets	27			6		399		84		49		14		32		(466	)	—	—
Due from/to Interstate Hotels & Resorts	—			—		—		—		—		—		—		—		—	—
Accounts payable, accrued expenses, accrued interest
and other liabilities	15			—		(5	)	171		309		183		71		541		—	—
Due from/to subsidiaries	(217	)		(636	)	1,004		(648	)	(1,482	)	(9,529	)	1,073		30,841		—	—
Net cash provided by (used in) operating activities	318			—		6,526		670		1,367		(8,458	)	3,399		36,691		—	—
Investing activities:
Acquisition of hotels, net of cash acquired of $4.1 million	—			—		—		—		—		—		—		(91,124	)	—	—
Capital expenditures for property and equipment	(318	)		—		(6,526	)	(670	)	(1,367	)	(3	)	(3,399	)	(552	)	—	—
Investment in and advance to Radisson Lexington Avenue Hotel	—			—		—		—		—		—		—		—		—	—
Proceeds from sales of assets	—			—		—		—		—		8,800		—		—		—	—
(Increase) decrease in restricted cash	—			—		—		—		—		—		—		—		—	—
Costs associated with disposition program and other, net	—			—		—		—		—		(339	)	—		—		—	—
Net cash (used in) provided by investing activities	(318	)		—		(6,526	)	(670	)	(1,367	)	8,458		(3,399	)	(91,676	)	—	—
			��
Financing activities:
Prepayments on long-term debt	—			—		—		—		—		—		—		—		—	—
Scheduled payments on long-term debt	—			—		—		—		—		—		—		(291	)	—	—
Proceeds from issuance of long-term debt	—			—		—		—		—		—		—		55,276		—	—
Loans to/from subsidiaries	—			—		—		—		—		—		—		—		—	—
Contributions from partners	—			—		—		—		—		—		—		—		—	—
Distributions to minority investors	—			—		—		—		—		—		—		—		—	—
Purchase of limited partnership unit	—			—		—		—		—		—		—		—		—	—
Net cash provided by (used in) financing activities	—			—		—		—		—		—		—		54,985		—	—
Effect of exchange rate changes on cash and cash equivalents	—			—		—		—		—		—		—		—		—	—
Net (decrease) increase in cash and cash equivalents	—			—		—		—		—		—		—		—		—	—
Cash and cash equivalents, beginning of year	—			—		—		—		—		—		—		—		—	—
Cash and cash equivalents, end of year	—			—		—		—		—		—		—		—		—	—

47

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2004(Dollars in thousands)

	MeriStar Sub 6I, LLC	MeriStar Sub 5I, LLC	CapStar Cherry Hill Company, LLC	MeriStar Acquisition Company, LLC	MeriStar Sub 6A, LLC	MeriStar Sub 6F, LLC	MeriStar Hotel Lessee, Inc.		Guarantor Eliminations		Guarantor Subsidiaries Total		Consolidation Eliminations		Total Consolidated
Operating activities:
Net income (loss)	—	—	—	—	—	—	(65,669	)	(1,439	)	(35,127	)	3,957		$	(99,133	)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	—	—	—	—	—	—	98		—		41,321		—			102,114
Loss on asset impairments	—	—	—	—	—	—	—		—		6,781		—			12,337
Loss on sale of assets, before tax effect	—	—	—	—	—	—	—		—		10,966		—			14,065
Loss on early extinguishments of debt	—	—	—	—	—	—	—		—		—		—			7,967
Minority interests	—	—	—	—	—	—	—		—		—		—			(79	)
Equity in income of unconsolidated affiliates	—	—	—	—	—	—	—		—		(237	)	(3,957	)		(237	)
Cash distributions from equity method of investment	—	—	—	—	—	—	—		—		840		—			840
Amortization of unearned stock-based compensation	—	—	—	—	—	—	—		—		—		—			(2,939	)
Redemption of POPs	—	—	—	—	—	—	—		—		—		—			(4,602	)
Deferred income taxes	—	—	—	—	—	—	—		—		—		—			(730	)
Changes in operating assets and liabilities:
Accounts receivable	—	—	—	—	—	—	7,309		740		15,110		9,414			4,009
Prepaid expenses and other assets	—	—	—	—	—	—	5,810		—		7,203		—			8,990
Due from/to Interstate Hotels & Resorts	—	—	—	—	—	—	964		—		964		—			(7,132	)
Accounts payable, accrued expenses, accrued interest and other liabilities	—	—	—	—	—	—	7,620		—		(1,867	)	(9,414	)		(24,604	)
Due from/to subsidiaries	—	—	—	—	—	—	(40,637	)	699		(110,090	)	—			—
Net cash provided by (used in) operating activities	—	—	—	—	—	—	(84,505	)	—		(64,136	)	—			10,866
Investing activities:
Acquisition of hotels, net of cash acquired of $4.1 million	—	—	—	—	—	—	—		—		(91,124	)	—			(182,375	)
Capital expenditures for property and equipment	—	—	—	—	—	—	(170	)	—		(63,268	)	—			(133,953	)
Investment in and advance to Radisson Lexington Avenue Hotel	—	—	—	—	—	—	—		—		—		—			(50,493	)
Proceeds from sales of assets	—	—	—	—	—	—	—		—		104,023		—			155,698
(Increase) decrease in restricted cash	—	—	—	—	—	—	(1,313	)	—		(1,198	)	—			(15,890	)
Costs associated with disposition program and other, net	—	—	—	—	—	—	—		—		(5,539	)	—			(7,475	)
Net cash (used in) provided by investing activities	—	—	—	—	—	—	(1,483	)	—		(57,106	)	—			(234,488	)
Financing activities:
Prepayments on long-term debt	—	—	—	—	—	—	—		—		(19,731	)	—			(105,049	)
Scheduled payments on long-term debt	—	—	—	—	—	—	—		—		(291	)	—			(13,336	)
Proceeds from issuance of long-term debt	—	—	—	—	—	—	—		—		55,276		—			109,718
Loans to/from subsidiaries	—	—	—	—	—	—	93,067		—		93,067		—			—
Contributions from partners	—	—	—	—	—	—	—		—		—		—			72,296
Distributions to minority investors	—	—	—	—	—	—	—		—		—		—			(141	)
Purchase of limited partnership unit	—	—	—	—	—	—	—		—		—		—			(8,854	)
Net cash provided by (used in) financing activities	—	—	—	—	—	—	93,067		—		128,321		—			54,634
Effect of exchange rate changes on cash and cash equivalents	—	—	—	—	—	—	—		—		—		—			(1,355	)
Net (decrease) increase in cash and cash equivalents	—	—	—	—	—	—	7,079		—		7,079		—			(170,343	)
Cash and cash equivalents, beginning of year	—	—	—	—	—	—	12,230		—		12,230		—			230,876
Cash and cash equivalents, end of year	—	—	—	—	—	—	19,309		—		19,309		—		$	60,533

48

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2003 (Dollars in thousands)

	MeriStar Hospitality OP, L.P.			Non- Guarantor Subsidiaries		MeriStar Sub 7C, LLC	MeriStar Sub 8G, LLC	AGH Upreit LLC	MeriStar Sub 6H, L.P.		MeriStar Sub 8F, L.P.		MeriStar Sub 8B, LLC		MeriStar Sub 1C, LLC		MeriStar Sub 8E, LLC
Operating activities:
Net income (loss)	$	(404,437	)	(88,833	)	—	—	—	10		1,208		3,441		(578	)	697
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization		10,522		52,099		—	—	—	569		587		2,416		1,015		583
Equity in earnings of affiliate		270,566		—		—	—	—	—		—		—		—		—
Loss on asset impairments		25,000		121,649		—	—	—	500		—		—		—		—
Gain (loss) on sale of assets, before tax effect		165		(798	)	—	—	—	—		—		—		—		—
Gain on early extinguishment of debt		(4,085	)	—		—	—	—	—		—		—		—		—
Minority interests		(62	)	—		—	—	—	—		—		—		—		—
Amortization of unearned stock based compensation		2,544		—		—	—	—	—		—		—		—		—
Change in value of interest rate swaps		(3,977	)	—		—	—	—	—		—		—		—		—
Deferred income taxes		(3,923	)	—		—	—	—	—		—		—		—		—
Changes in operating assets and liabilities:
Accounts receivable		(6,276	)	355		—	—	—	—		(28	)	—		—		—
Prepaid expenses and other assets		(4,498	)	1,941		—	—	—	(1	)	30		38		88		10
Due from/to Interstate Hotels & Resorts		6,551		—		—	—	—	—		—		—		—		—
Accounts payable, accrued expenses, accrued interest and other liabilities		(864	)	(13,443	)	—	—	—	(18	)	(140	)	(124	)	(98	)	(24	)
Due from subsidiaries		302,842		(178,645	)	—	—	—	(1,044	)	(1,626	)	(4,428	)	887		(1,047	)
Net cash provided by (used in) operating activities		190,068		(105,675	)	—	—	—	16		31		1,343		1,314		219
Investing activities:
Capital expenditures for property and equipment		(2,001	)	(13,202	)	—	—	—	(16	)	(31	)	(1,343	)	(1,314	)	(219	)
Proceeds from sales of assets		—		34,065		—	—	—	—		—		—		—		—
Sales of marketable securities		18,040		—		—	—	—	—		—		—		—		—
Purchases of marketable securities		(18,040	)	—		—	—	—	—		—		—		—		—
Net payments from Interstate Hotels & Resorts		42,052		—		—	—	—	—		—		—		—		—
(Increase) decrease in restricted cash		(24,558	)	2,400		—	—	—	—		—		—		—		—
Costs associated with disposition program and other, net		—		(2,314	)	—	—	—	—		—		—		—		—
Net cash provided by (used in) investing activities		15,493		20,949		—	—	—	(16	)	(31	)	(1,343	)	(1,314	)	(219	)
Financing activities:
Prepayments on long-term debt		(185,879	)	(16,274	)	—	—	—	—		—		—		—		—
Scheduled payments on long-term debt		(16,845	)	—		—	—	—	—		—		—		—		—
Proceeds from issuance of long-term debt		159,468		101,000		—	—	—	—		—		—		—		—
Loans to/from subsidiaries		(59,629	)	—		—	—	—	—		—		—		—		—
Contributions from partners		95,358		—		—	—	—	—		—		—		—		—
Distributions paid to minority investors		(565	)	—		—	—	—	—		—		—		—		—
Purchase of limited partnership unit		(65	)	—		—	—	—	—		—		—		—		—
Net cash provided by (used in) financing activities		(8,157	)	84,726		—	—	—	—		—		—		—		—
Effect of exchange rate changes on cash and cash equivalents		(129	)	—		—	—	—	—		—		—		—		—
Net increase (decrease) in cash and cash equivalents		197,275		—		—	—	—	—		—		—		—		—
Cash and cash equivalents, beginning of year		21,372		—		—	—	—	—		—		—		—		—
Cash and cash equivalents, end of year	$	218,647		—		—	—	—	—		—		—		—		—

49

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2003 (Dollars in thousands)

	MeriStar Sub 7F, LLC		MeriStar Sub 5L, LLC		MeriStar Sub 3C, LLC		MeriStar Sub 5R, LLC	MeriStar Sub 8A, LLC		MeriStar Sub 6D, LLC		MeriStar Sub 6E, LLC		MeriStar Sub 4E, L.P.		MeriStar Sub 1B, LLC		MeriStar Sub 5F, L.P.
Operating activities:
Net income (loss)	(1,688	)	682		595		—	—		1,112		2,913		(14,966	)	2,120		(7,943	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	425		142		709		—	—		546		1,629		577		535		941
Equity in earnings of affiliate	—		—		—		—	—		—		—		—		—		—
Loss on asset impairments	2,037		—		—		—	—		—		—		15,347		—		9,231
Gain (loss) on sale of assets, before tax effect	—		—		—		—	—		—		—		—		—		—
Gain on early extinguishment of debt	—		—		—		—	—		—		—		—		—		—
Minority interests	—		—		—		—	—		—		—		—		—		—
Amortization of unearned stock based compensation	—		—		—		—	—		—		—		—		—		—
Change in value of interest rate swaps	—		—		—		—	—		—		—		—		—		—
Deferred income taxes	—		—		—		—	—		—		—		—		—		—
Changes in operating assets and liabilities:
Accounts receivable	—		28		—		—	(17	)	(2	)	—		—		—		—
Prepaid expenses and other assets	1		24		10		—	—		7		33		17		33		68
Due from/to Interstate Hotels & Resorts	—		—		—		—	—		—		—		—		—		—
Accounts payable, accrued expenses, accrued interest
and other liabilities	46		(50	)	(68	)	—	36		20		(76	)	(64	)	(12	)	(73	)
Due from subsidiaries	(756	)	(564	)	(1,128	)	—	(19	)	(1,664	)	(3,839	)	(773	)	(2,421	)	(1,958	)
Net cash provided by (used in) operating activities	65		262		118		—	—		19		660		138		255		266
Investing activities:
Capital expenditures for property and equipment	(65	)	(262	)	(118	)	—	—		(19	)	(660	)	(138	)	(240	)	(266	)
Proceeds from sales of assets	—		—		—		—	—		—		—		—		—		—
Sales of marketable securities	—		—		—		—	—		—		—		—		—		—
Purchases of marketable securities	—		—		—		—	—		—		—		—		—		—
Net payments from Interstate Hotels & Resorts	—		—		—		—	—		—		—		—		—		—
(Increase) decrease in restricted cash	—		—		—		—	—		—		—		—		—		—
Costs associated with disposition program and other, net	—		—		—		—	—		—		—		—		—		—
Net cash provided by (used in) investing activities	(65	)	(262	)	(118	)	—	—		(19	)	(660	)	(138	)	(240	)	(266	)
Financing activities:
Prepayments on long-term debt	—		—		—		—	—		—		—		—		(15	)	—
Scheduled payments on long-term debt	—		—		—		—	—		—		—		—		—		—
Proceeds from issuance of long-term debt	—		—		—		—	—		—		—		—		—		—
Loans to/from subsidiaries	—		—		—		—	—		—		—		—		—		—
Contributions from partners	—		—		—		—	—		—		—		—		—		—
Distributions paid to minority investors	—		—		—		—	—		—		—		—		—		—
Purchase of limited partnership unit	—		—		—		—	—		—		—		—		—		—
Net cash provided by (used in) financing activities	—		—		—		—	—		—		—		—		(15	)	—
Effect of exchange rate changes on cash and cash equivalents	—		—		—		—	—		—		—		—		—		—
Net increase (decrease) in cash and cash equivalents	—		—		—		—	—		—		—		—		—		—
Cash and cash equivalents, beginning of year	—		—		—		—	—		—		—		—		—		—
Cash and cash equivalents, end of year	—		—		—		—	—		—		—		—		—		—

50

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2003 (Dollars in thousands)

	MeriStar Sub 6G, LLC		MeriStar Sub 8C, LLC		MeriStar Sub 4C, L.P		MeriStar Sub 4H, L.P.		MeriStar Sub 7E, LLC		MeriStar Sub 3D, LLC		MeriStar Sub 1A, LLC		MeriStar Sub 7A Joint Venture		MeriStar Sub 2B, LLC		MeriStar Sub 3A, LLC
Operating activities:
Net income (loss)	1,302		(4,555	)	—		(5,491	)	533		423		927		(4,907	)	(6,486	)	(1,933	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	848		669		—		394		615		776		450		336		357		236
Equity in earnings of affiliate	—		—		—		—		—		—		—		—		—		—
Loss on asset impairments	—		5,213		—		5,187		—		—		—		5,478		4,670		2,137
Gain (loss) on sale of assets, before tax effect	—		—		—		—		—		—		—		—		1,335		—
Gain on early extinguishment of debt	—		—		—		—		—		—		—		—		—		—
Minority interests	—		—		—		—		—		—		—		—		—		—
Amortization of unearned stock based compensation	—		—		—		—		—		—		—		—		—		—
Change in value of interest rate swaps	—		—		—		—		—		—		—		—		—		—
Deferred income taxes	—		—		—		—		—		—		—		—		—		—
Changes in operating assets and liabilities:
Accounts receivable	—		—		1		14		—		—		—		—		(2,357	)	—
Prepaid expenses and other assets	12		(117	)	—		8		8		16		56		4		—		(1	)
Due from/to Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
Accounts payable, accrued expenses, accrued interest and other liabilities	(177	)	(229	)	(130	)	6		(12	)	(31	)	(138	)	(68	)	—		(2	)
Due from subsidiaries	(1,788	)	(970	)	129		53		(547	)	(1,051	)	(1,099	)	(669	)	5,889		(403	)
Net cash provided by (used in) operating activities	197		11		—		171		597		133		196		174		3,408		34
Investing activities:
Capital expenditures for property and equipment	(197	)	(11	)	—		(171	)	(597	)	(133	)	(196	)	(174	)	(1,286	)	(34	)
Proceeds from sales of assets	—		—		—		—		—		—		—		—		3,780		—
Sales of marketable securities	—		—		—		—		—		—		—		—		—		—
Purchases of marketable securities	—		—		—		—		—		—		—		—		—		—
Net payments from Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
(Increase) decrease in restricted cash	—		—		—		—		—		—		—		—		—		—
Costs associated with disposition program and other, net	—		—		—		—		—		—		—		—		(202	)	—
Net cash provided by (used in) investing activities	(197	)	(11	)	—		(171	)	(597	)	(133	)	(196	)	(174	)	2,292		(34	)
Financing activities:
Prepayments on long-term debt	—		—		—		—		—		—		—		—		(5,700	)	—
Scheduled payments on long-term debt	—		—		—		—		—		—		—		—		—		—
Proceeds from issuance of long-term debt	—		—		—		—		—		—		—		—		—		—
Loans to/from subsidiaries	—		—		—		—		—		—		—		—		—		—
Contributions from partners	—		—		—		—		—		—		—		—		—		—
Distributions paid to minority investors	—		—		—		—		—		—		—		—		—		—
Purchase of limited partnership unit	—		—		—		—		—		—		—		—		—		—
Net cash provided by (used in) financing activities	—		—		—		—		—		—		—		—		(5,700	)	—
Effect of exchange rate changes on cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
Net increase (decrease) in cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, beginning of year	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, end of year	—		—		—		—		—		—		—		—		—		—

51

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2003 (Dollars in thousands)

	MeriStar Sub 4A, L.P.		MeriStar Sub 4D, LLC		MeriStar Sub 2A, LLC		MeriStar Sub 6L, LLC		MDV Limited Partnership		MeriStar Sub 5C, LLC		MeriStar Sub 6J, LLC		MeriStar Sub 1D, LLC		MeriStar Sub 7B, L.P.		MeriStar Sub 7D, LLC
Operating activities:
Net income (loss)	(845	)	(939	)	(5,037	)	(12,550	)	228		(5,634	)	1,307		852		(9,925	)	2,698
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	125		55		289		679		139		431		581		2,276		497		1,723
Equity in earnings of affiliate	—		—		—		—		—		—		—		—		—		—
Loss on asset impairments	1,455		1,004		2,828		13,286		—		7,187		—		—		10,288		—
Gain (loss) on sale of assets, before tax effect	—		—		1,524		—		—		(1,344	)	—		—		—		—
Gain on early extinguishment of debt	—		—		—		—		—		—		—		—		—		—
Minority interests	—		—		—		—		—		—		—		—		—		—
Amortization of unearned stock based compensation	—		—		—		—		—		—		—		—		—		—
Change in value of interest rate swaps	—		—		—		—		—		—		—		—		—		—
Deferred income taxes	—		—		—		—		—		—		—		—		—		—
Changes in operating assets and liabilities:
Accounts receivable	—		—		(2,002	)	—		—		—		—		—		—		(300	)
Prepaid expenses and other assets	9		(3	)	—		(14	)	13		70		9		209		(1	)	33
Due from/to Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
Accounts payable, accrued expenses, accrued interest and other liabilities	(4	)	(112	)	(73	)	(26	)	1		(866	)	(100	)	(228	)	(68	)	(383	)
Due from subsidiaries	(476	)	(2,837	)	8,906		(1,310	)	(369	)	(4,795	)	(1,679	)	(2,856	)	(670	)	(3,538	)
Net cash provided by (used in) operating activities	264		(2,832	)	6,435		65		12		(4,951	)	118		253		121		233
Investing activities:
Capital expenditures for property and equipment	(264	)	(91	)	(308	)	(65	)	(12	)	(356	)	(118	)	(253	)	(121	)	(233	)
Proceeds from sales of assets	—		3,070		3,612		—		—		5,500		—		—		—		—
Sales of marketable securities	—		—		—		—		—		—		—		—		—		—
Purchases of marketable securities	—		—		—		—		—		—		—		—		—		—
Net payments from Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
(Increase) decrease in restricted cash	—		—		—		—		—		—		—		—		—		—
Costs associated with disposition program and other, net	—		(147	)	(442	)	—		—		(193	)	—		—		—		—
Net cash provided by (used in) investing activities	(264	)	2,832		2,862		(65	)	(12	)	4,951		(118	)	(253	)	(121	)	(233	)
Financing activities:
Prepayments on long-term debt	—		—		(9,297	)	—		—		—		—		—		—		—
Scheduled payments on long-term debt	—		—		—		—		—		—		—		—		—		—
Proceeds from issuance of long-term debt	—		—		—		—		—		—		—		—		—		—
Loans to/from subsidiaries	—		—		—		—		—		—		—		—		—		—
Contributions from partners	—		—		—		—		—		—		—		—		—		—
Distributions paid to minority investors	—		—		—		—		—		—		—		—		—		—
Purchase of limited partnership unit	—		—		—		—		—		—		—		—		—		—
Net cash provided by (used in) financing activities	—		—		(9,297	)	—		—		—		—		—		—		—
Effect of exchange rate changes on cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
Net increase (decrease) in cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, beginning of year	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, end of year	—		—		—		—		—		—		—		—		—		—

52

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2003 (Dollars in thousands)

	MeriStar Sub 7G, LLC		MeriStar Sub 6B, LLC		MeriStar Sub 4I, L.P.		MeriStar Sub 5D, LLC		MeriStar Sub 5H, LLC		MeriStar Sub 7H, LLC		AGH PSS I, Inc.		MeriStar Sub 2D, LLC		MeriStar Sub 4F, L.P.		MeriStar Sub 5K, LLC
Operating activities:
Net income (loss)	(10,327	)	429		(2,614	)	(779	)	(17,432	)	(1,564	)	(929	)	(9,171	)	483		593
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	492		449		261		1,459		1,179		169		—		390		1,107		1,290
Equity in earnings of affiliate	—		—		—		—		—		—		—		—		—		—
Loss on asset impairments	10,216		—		1,259		—		18,075		1,383		1,787		8,685		—		—
Gain (loss) on sale of assets, before tax effect	—		—		961		—		293		741		318		295		—		—
Gain on early extinguishment of debt	—		—		—		—		—		—		—		—		—		—
Minority interests	—		—		—		—		—		—		—		—		—		—
Amortization of unearned stock based compensation	—		—		—		—		—		—		—		—		—		—
Change in value of interest rate swaps	—		—		—		—		—		—		—		—		—		—
Deferred income taxes	—		—		—		—		—		—		—		—		—		—
Changes in operating assets and liabilities:
Accounts receivable	—		—		—		—		(46	)	(43	)	—		(1,166	)	—		—
Prepaid expenses and other assets	—		5		—		33		(1	)	—		(1	)	—		(13	)	74
Due from/to Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
Accounts payable, accrued expenses, accrued interest and other liabilities	(43	)	(12	)	(472	)	(194	)	(148	)	(267	)	(107	)	(64	)	(29	)	(1,288	)
Due from subsidiaries	(244	)	(714	)	(744	)	(427	)	(27,496	)	(3,670	)	(14,293	)	6,904		(845	)	(340	)
Net cash provided by (used in) operating activities	94		157		(1,349	)	92		(25,576	)	(3,251	)	(13,225	)	5,873		703		329
Investing activities:
Capital expenditures for property and equipment	(94	)	(157	)	(65	)	(92	)	(901	)	(271	)	(800	)	(1,118	)	(703	)	(329	)
Proceeds from sales of assets	—		—		1,500		—		27,250		3,750		14,500		6,608		—		—
Sales of marketable securities	—		—		—		—		—		—		—		—		—		—
Purchases of marketable securities	—		—		—		—		—		—		—		—		—		—
Net payments from Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
(Increase) decrease in restricted cash	—		—		—		—		—		—		—		—		—		—
Costs associated with disposition program and other, net	—		—		(86	)	—		(773	)	(215	)	(475	)	(591	)	—		—
Net cash provided by (used in) investing activities	(94	)	(157	)	1,349		(92	)	25,576		3,264		13,225		4,899		(703	)	(329	)
Financing activities:
Prepayments on long-term debt	—		—		—		—		—		(13	)	—		(10,772	)	—		—
Scheduled payments on long-term debt	—		—		—		—		—		—		—		—		—		—
Proceeds from issuance of long-term debt	—		—		—		—		—		—		—		—		—		—
Loans to/from subsidiaries	—		—		—		—		—		—		—		—		—		—
Contributions from partners	—		—		—		—		—		—		—		—		—		—
Distributions paid to minority investors	—		—		—		—		—		—		—		—		—		—
Purchase of limited partnership unit	—		—		—		—		—		—		—		—		—		—
Net cash provided by (used in) financing activities	—		—		—		—		—		(13	)	—		(10,772	)	—		—
Effect of exchange rate changes on cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
Net increase (decrease) in cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, beginning of year	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, end of year	—		—		—		—		—		—		—		—		—		—

53

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2003 (Dollars in thousands)

	MeriStar Sub 5M, LLC		MeriStar Sub 1E, LLC		MeriStar Sub 5O, LLC		MeriStar Sub 4B, L.P.		MeriStar Sub 2C, LLC		MeriStar Sub 4G, L.P.		MeriStar Sub 3B, LLC		MeriStar Sub 5G, L.P.		MeriStar Sub 5N, LLC		MeriStar Sub 5P, LLC
Operating activities:
Net income (loss)	813		8,205		377		(1,275	)	(17,784	)	(11,178	)	(1,245	)	1,691		612		1,132
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	472		244		228		555		895		720		259		6,290		137		5
Equity in earnings of affiliate	—		—		—		—		—		—		—		—		—		—
Loss on asset impairments	—		—		—		638		16,455		11,850		1,064		—		—		—
Gain (loss) on sale of assets, before tax effect	—		(7,247	)	—		—		—		—		415		—		—		—
Gain on early extinguishment of debt	—		—		—		—		—		—		—		—		—		—
Minority interests	—		—		—		—		—		—		—		—		—		—
Amortization of unearned stock based compensation	—		—		—		—		—		—		—		—		—		—
Change in value of interest rate swaps	—		—		—		—		—		—		—		—		—		—
Deferred income taxes	—		—		—		—		—		—		—		—		—		—
Changes in operating assets and liabilities:
Accounts receivable	—		(198	)	—		—		2		—		—		—		—		(38	)
Prepaid expenses and other assets	48		1		15		4		241		89		3		260		18		4
Due from/to Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
Accounts payable, accrued expenses, accrued interest and other liabilities	(48	)	1		(15	)	(33	)	19		(70	)	(173	)	(63	)	(18	)	(4	)
Due from subsidiaries	(1,251	)	(18,078	)	(591	)	250		1,573		(1,350	)	(6,513	)	(7,142	)	(720	)	(1,099	)
Net cash provided by (used in) operating activities	34		(17,072	)	14		139		1,401		61		(6,190	)	1,036		29		—
Investing activities:
Capital expenditures for property and equipment	(34	)	1,204		(14	)	(139	)	(485	)	(61	)	(809	)	(1,036	)	(29	)	—
Proceeds from sales of assets	—		16,500		—		—		—		—		7,750		—		—		—
Sales of marketable securities	—		—		—		—		—		—		—		—		—		—
Purchases of marketable securities	—		—		—		—		—		—		—		—		—		—
Net payments from Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
(Increase) decrease in restricted cash	—		—		—		—		—		—		—		—		—		—
Costs associated with disposition program and other, net	—		(632	)	—		—		—		—		(751	)	—		—		—
Net cash provided by (used in) investing activities	(34	)	17,072		(14	)	(139	)	(485	)	(61	)	6,190		(1,036	)	(29	)	—
Financing activities:
Prepayments on long-term debt	—		—		—		—		(916	)	—		—		—		—		—
Scheduled payments on long-term debt	—		—		—		—		—		—		—		—		—		—
Proceeds from issuance of long-term debt	—		—		—		—		—		—		—		—		—		—
Loans to/from subsidiaries	—		—		—		—		—		—		—		—		—		—
Contributions from partners	—		—		—		—		—		—		—		—		—		—
Distributions paid to minority investors	—		—		—		—		—		—		—		—		—		—
Purchase of limited partnership unit	—		—		—		—		—		—		—		—		—		—
Net cash provided by (used in) financing activities	—		—		—		—		(916	)	—		—		—		—		—
Effect of exchange rate changes on cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
Net increase (decrease) in cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, beginning of year	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, end of year	—		—		—		—		—		—		—		—		—		—

54

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2003 (Dollars in thousands)

	MeriStar Sub 5J, LLC		MeriStar Sub 5Q, LLC		MeriStar Sub 5A, LLC		MeriStar Sub 8D, LLC		MeriStar Sub 4J, LLC		MeriStar Sub 6K, LLC		MeriStar Sub 5E, LLC		MeriStar Sub 6I, LLC	MeriStar Sub 5I, LLC	CapStar Cherry Hill Company, LLC
Operating activities:
Net income (loss)	3,719		1,045		1,013		(15,069	)	1,152		2,154		2,194		—	—	—
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	3,483		560		1,291		872		1,270		538		1,438		—	—	—
Equity in earnings of affiliate	—		—		—		—		—		—		—		—	—	—
Loss on asset impairments	—		—		—		16,128		—		—		—		—	—	—
Gain (loss) on sale of assets, before tax effect	—		—		—		—		—		—		—		—	—	—
Gain on early extinguishment of debt	—		—		—		—		—		—		—		—	—	—
Minority interests	—		—		—		—		—		—		—		—	—	—
Amortization of unearned stock based compensation	—		—		—		—		—		—		—		—	—	—
Change in value of interest rate swaps	—		—		—		—		—		—		—		—	—	—
Deferred income taxes	—		—		—		—		—		—		—		—	—	—
Changes in operating assets and liabilities:
Accounts receivable	—		—		—		—		(11	)	—		—		—	—	—
Prepaid expenses and other assets	370		53		29		(14	)	19		2		12		—	—	—
Due from/to Interstate Hotels & Resorts	—		—		—		—		—		—		—		—	—	—
Accounts payable, accrued expenses, accrued interest and other liabilities	(322	)	(67	)	(192	)	(66	)	(90	)	(215	)	246		—	—	—
Due from subsidiaries	(4,315	)	(1,363	)	(1,415	)	(1,362	)	(2,031	)	(2,374	)	(3,833	)	—	—	—
Net cash provided by (used in) operating activities	2,935		228		726		489		309		105		57		—	—	—
Investing activities:
Capital expenditures for property and equipment	(2,935	)	(228	)	(726	)	(489	)	(309	)	(105	)	(57	)	—	—	—
Proceeds from sales of assets	—		—		—		—		—		—		—		—	—	—
Sales of marketable securities	—		—		—		—		—		—		—		—	—	—
Purchases of marketable securities	—		—		—		—		—		—		—		—	—	—
Net payments from Interstate Hotels & Resorts	—		—		—		—		—		—		—		—	—	—
(Increase) decrease in restricted cash	—		—		—		—		—		—		—		—	—	—
Costs associated with disposition program and other, net	—		—		—		—		—		—		—		—	—	—
Net cash provided by (used in) investing activities	(2,935	)	(228	)	(726	)	(489	)	(309	)	(105	)	(57	)	—	—	—
Financing activities:
Prepayments on long-term debt	—		—		—		—		—		—		—		—	—	—
Scheduled payments on long-term debt	—		—		—		—		—		—		—		—	—	—
Proceeds from issuance of long-term debt	—		—		—		—		—		—		—		—	—	—
Loans to/from subsidiaries	—		—		—		—		—		—		—		—	—	—
Contributions from partners	—		—		—		—		—		—		—		—	—	—
Distributions paid to minority investors	—		—		—		—		—		—		—		—	—	—
Purchase of limited partnership unit	—		—		—		—		—		—		—		—	—	—
Net cash provided by (used in) financing activities	—		—		—		—		—		—		—		—	—	—
Effect of exchange rate changes on cash and cash equivalents	—		—		—		—		—		—		—		—	—	—
Net increase (decrease) in cash and cash equivalents	—		—		—		—		—		—		—		—	—	—
Cash and cash equivalents, beginning of year	—		—		—		—		—		—		—		—	—	—
Cash and cash equivalents, end of year	—		—		—		—		—		—		—		—	—	—

55

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2003 (Dollars in thousands)

	Meristar Acquisition Company, LLC	MeriStar Sub 6A, LLC	MeriStar Sub 6F, LLC	MeriStar Hotel Lessee, Inc.		Guarantor Subsidiaries Total		Consolidation Eliminations		Total Consolidated
Operating activities:
Net income (loss)	—	—	—	(55,549	)	(181,733	)	270,566		$	(404,437	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	—	—	—	1,067		49,270		—			111,891
Equity in earnings of affiliate	—	—	—	—		—		(270,566	)		—
Loss on asset impairments	—	—	—	—		173,388		—			320,037
Gain (loss) on sale of assets, before tax effect	—	—	—	5,698		2,989		—			2,356
Gain on early extinguishment of debt	—	—	—	—		—		—			(4,085	)
Minority interests	—	—	—	—		—		—			(62	)
Amortization of unearned stock based compensation	—	—	—	—		—		—			2,544
Change in value of interest rate swaps	—	—	—	—		—		—			(3,977	)
Deferred income taxes	—	—	—	—		—		—			(3,923	)
Changes in operating assets and liabilities:
Accounts receivable	—	—	—	4,203		(1,960	)	—			(7,881	)
Prepaid expenses and other assets	—	—	—	292		2,212		—			(345	)
Due from/to Interstate Hotels & Resorts	—	—	—	(640	)	(640	)	—			5,911
Accounts payable, accrued expenses, accrued interest and other liabilities	—	—	—	(13,840	)	(20,859	)	—			(35,166	)
Due from subsidiaries	—	—	—	(254	)	(124,197	)	—			—
Net cash provided by (used in) operating activities	—	—	—	(59,023	)	(101,530	)	—			(17,137	)
Investing activities:
Capital expenditures for property and equipment	—	—	—	(894	)	(20,987	)	—			(36,190	)
Proceeds from sales of assets	—	—	—	—		93,820		—			127,885
Sales of marketable securities	—	—	—	—		—		—			18,040
Purchases of marketable securities	—	—	—	—		—		—			(18,040	)
Net payments from Interstate Hotels & Resorts	—	—	—	—		—		—			42,052
(Increase) decrease in restricted cash	—	—	—	—		—		—			(22,158	)
Costs associated with disposition program and other, net	—	—	—	—		(4,507	)	—			(6,821	)
Net cash provided by (used in) investing activities	—	—	—	(894	)	68,326		—			104,768
Financing activities:
Prepayments on long-term debt	—	—	—	—		(26,713	)	—			(228,866	)
Scheduled payments on long-term debt	—	—	—	—		—		—			(16,845	)
Proceeds from issuance of long-term debt	—	—	—	—		—		—			260,468
Loans to/from subsidiaries	—	—	—	59,629		59,629		—			—
Contributions from partners	—	—	—	—		—		—			95,358
Distributions paid to minority investors	—	—	—	—		—		—			(565	)
Purchase of limited partnership unit	—	—	—	—		—		—			(65	)
Net cash provided by (used in) financing activities	—	—	—	59,629		32,916		—			109,485
Effect of exchange rate changes on cash and cash equivalents	—	—	—	—		—		—			(129	)
Net increase (decrease) in cash and cash equivalents	—	—	—	(288	)	(288	)	—			196,987
Cash and cash equivalents, beginning of year	—	—	—	12,517		12,517		—			33,889
Cash and cash equivalents, end of year	—	—	—	12,229		12,229		—		$	230,876

56

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2002 (Dollars in thousands)

	MeriStar Hospitality OP, L.P.			Non- Guarantor Subsidiaries		MeriStar Sub 7C, LLC	AGH Upreit LLC	MeriStar Sub 5N, LLC		MeriStar Sub 8A, LLC		MeriStar Sub 8F, L.P.		MeriStar Sub 8G, LLC	MeriStar Sub 6H, L.P.		MeriStar Sub 8B, LLC
Operating activities:
Net income (loss)	$	(170,169	)	(2,843	)	—	—	646		(4,107	)	1,106		—	942		3,356
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization		13,433		50,468		—	—	133		112		453		—	431		2,385
Equity in earnings of affiliate		33,753		—		—	—	—		—		—		—	—		—
Loss on asset impairments		—		23,580		—	—	—		—		—		—	—		—
Loss on sale of assets, before tax effect		—		14,807		—	—	—		4,812		—		—	—		—
Loss on fair value of non-hedging derivatives		4,735		—		—	—	—		—		—		—	—		—
Write down of note receivable with Interstate Hotels & Resorts		14,517		—		—	—	—		—		—		—	—		—
Minority interests		(15	)	—		—	—	—		—		—		—	—		—
Amortization of unearned stock based compensation		4,543		—		—	—	—		—		—		—	—		—
Change in value of interest rate swaps		(7,612	)	—		—	—	—		—		—		—	—		—
Deferred income taxes		(2,143	)	—		—	—	—		—		(96	)	—	—		—
Changes in operating assets and liabilities:		—		—		—	—	—		—		—		—	—		—
Accounts receivable		(7,852	)	(129	)	—	—	(16	)	(15	)	8		—	—		—
Prepaid expenses and other assets		(1,780	)	(589	)	—	—	—		—		19		—	—		—
Due from/to Interstate Hotels & Resorts		144		—		—	—	—		—		—		—	—		—
Due from subsidiaries		193,137		(96,158	)	—	—	(713	)	(2,462	)	(1,401	)	—	(1,303	)	(5,055	)
Accounts payable, accrued expenses, accrued interest and other liabilities		(537	)	(3,742	)	—	—	(7	)	457		47		—	(5	)	214
Net cash provided by (used in) operating activities		74,154		(14,606	)	—	—	43		(1,203	)	136		—	65		900
Investing activities:
Capital expenditures for property and equipment		(2,324	)	(17,000	)	—	—	(43	)	(4,616	)	(136	)	—	(65	)	(900	)
Proceeds from sales of assets		—		42,780		—	—	—		6,270		—		—	—		—
Net payments from (advances to) Interstate Hotels & Resorts		(7,500	)	775		—	—	—		—		—		—	—		—
(Increase) decrease in restricted cash		(1,623	)	2,562		—	—	—		—		—		—	—		—
Costs associated with disposition program and other, net		—		(1,358	)	—	—	—		(451	)	—		—	—		—
Net cash provided by (used in) investing activities		(11,447	)	27,759		—	—	(43	)	1,203		(136	)	—	(65	)	(900	)
Financing activities:
Prepayments on long-term debt		(314,843	)	(18,157	)	—	—	—		—		—		—	—		—
Scheduled payments on long-term debt		(19,466	)	—		—	—	—		—		—		—	—		—
Proceeds from issuance of long-term debt		300,150		—		—	—	—		—		—		—	—		—
Loans to/from subsidiaries		(15,396	)	—		—	—	—		—		—		—	—		—
Contributions from partners		3,153		—		—	—	—		—		—		—	—		—
Distributions paid to minority investors		(3,060	)	—		—	—	—		—		—		—	—		—
Net cash provided by (used in) financing activities		(49,462	)	(18,157	)	—	—	—		—		—		—	—		—
Effect of exchange rate changes on cash		205		—		—	—	—		—		—		—	—		—
Net increase (decrease) in cash and cash equivalents		13,450		(5,004	)	—	—	—		—		—		—	—		—
Cash and cash equivalents, beginning of year		6,798		—		—	—	—		—		—		—	—		—
Cash and cash equivalents, end of year	$	20,248		(5,004	)	—	—	—		—		—		—	—		—

57

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2002 (Dollars in thousands)

	MeriStar Sub 1C, L.P.		MeriStar Sub 8E, LLC		MeriStar Sub 7F, LLC		MeriStar Sub 5L, LLC		MeriStar Sub 3C, LLC		MeriStar Sub 5R, LLC	Old MeriStar Sub 8A, LLC		MeriStar Sub 6D, LLC		MeriStar Sub 6E, LLC		MeriStar Sub 4E, L.P.
Operating activities:
Net income (loss)	(458	)	851		470		733		557		—	—		1,340		3,141		83
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	1,021		600		463		135		706		—	—		526		1,692		918
Equity in earnings of affiliate	—		—		—		—		—		—	—		—		—		—
Loss on asset impairments	—		—		—		—		—		—	—		—		—		—
Loss on sale of assets, before tax effect	—		—		—		—		—		—	—		—		—		—
Loss on fair value of non-hedging derivatives	—		—		—		—		—		—	—		—		—		—
Write down of note receivable with Interstate Hotels & Resorts	—		—		—		—		—		—	—		—		—		—
Minority interests	—		—		—		—		—		—	—		—		—		—
Amortization of unearned stock based compensation	—		—		—		—		—		—	—		—		—		—
Change in value of interest rate swaps	—		—		—		—		—		—	—		—		—		—
Deferred income taxes	—		—		—		—		—		—	—		—		—		—
Changes in operating assets and liabilities:	—		—		—		—		—		—	—		—		—		—
Accounts receivable	—		—		—		(28	)	—		—	—		14		—		—
Prepaid expenses and other assets	—		—		—		—		—		—	1		—		—		—
Due from/to Interstate Hotels & Resorts	—		—		—		—		—		—	—		—		—		—
Due from subsidiaries	(302	)	(1,317	)	(866	)	(585	)	(1,195	)	—	46		(1,633	)	(4,432	)	(766	)
Accounts payable, accrued expenses, accrued interest and other liabilities	141		(16	)	(6	)	32		38		—	(46	)	(83	)	163		(41	)
Net cash provided by (used in) operating activities	402		118		61		287		106		—	1		164		564		194
Investing activities:
Capital expenditures for property and equipment	(402	)	(118	)	(61	)	(287	)	(106	)	—	(1	)	(164	)	(564	)	(194	)
Proceeds from sales of assets	—		—		—		—		—		—	—		—		—		—
Net payments from (advances to) Interstate Hotels & Resorts	—		—		—		—		—		—	—		—		—		—
(Increase) decrease in restricted cash	—		—		—		—		—		—	—		—		—		—
Costs associated with disposition program and other, net	—		—		—		—		—		—	—		—		—		—
Net cash provided by (used in) investing activities	(402	)	(118	)	(61	)	(287	)	(106	)	—	(1	)	(164	)	(564	)	(194	)
Financing activities:
Prepayments on long-term debt	—		—		—		—		—		—	—		—		—		—
Scheduled payments on long-term debt	—		—		—		—		—		—	—		—		—		—
Proceeds from issuance of long-term debt	—		—		—		—		—		—	—		—		—		—
Loans to/from subsidiaries	—		—		—		—		—		—	—		—		—		—
Contributions from partners	—		—		—		—		—		—	—		—		—		—
Distributions paid to minority investors	—		—		—		—		—		—	—		—		—		—
Net cash provided by (used in) financing activities	—		—		—		—		—		—	—		—		—		—
Effect of exchange rate changes on cash	—		—		—		—		—		—	—		—		—		—
Net increase (decrease) in cash and cash equivalents	—		—		—		—		—		—	—		—		—		—
Cash and cash equivalents, beginning of year	—		—		—		—		—		—	—		—		—		—
Cash and cash equivalents, end of year	—		—		—		—		—		—	—		—		—		—

58

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2002 (Dollars in thousands)

	MeriStar Sub 1B, LLC		MeriStar Sub 5F, L.P.		MeriStar Sub 6G, LLC		MeriStar Sub 8C, LLC		MeriStar Sub 4C, L.P.		MeriStar Sub 4H, L.P.		MeriStar Sub 7E, LLC		MeriStar Sub 3D, LLC		MeriStar Sub 1A, LLC		MeriStar Sub 5E, LLC
Operating activities:
Net income (loss)	2,213		1,235		1,327		(20,129	)	(1,407	)	(145	)	568		1,123		938		3,232
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	602		1,058		837		1,389		283		541		634		849		453		1,943
Equity in earnings of affiliate	—		—		—		—		—		—		—		—		—		—
Loss on asset impairments	—		—		—		20,111		—		—		—		—		—		—
Loss on sale of assets, before tax effect	—		—		—		—		1,578		—		—		—		—		—
Loss on fair value of non-hedging derivatives	—		—		—		—		—		—		—		—		—		—
Write down of note receivable with Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
Minority interests	—		—		—		—		—		—		—		—		—		—
Amortization of unearned stock based compensation	—		—		—		—		—		—		—		—		—		—
Change in value of interest rate swaps	—		—		—		—		—		—		—		—		—		—
Deferred income taxes	—		—		—		—		(32	)	—		—		—		—		—
Changes in operating assets and liabilities:	—		—		—		—		—		—		—		—		—		—
Accounts receivable	(96	)	—		—		—		(1	)	—		—		—		—		—
Prepaid expenses and other assets	(1	)	—		—		—		—		(14	)	—		—		—		—
Due from/to Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
Due from subsidiaries	(2,474	)	(1,778	)	(1,789	)	(1,168	)	(11,656	)	(262	)	(1,021	)	(1,789	)	(1,277	)	(5,007	)
Accounts payable, accrued expenses, accrued interest and other liabilities	62		76		(44	)	(56	)	350		(21	)	(31	)	61		(27	)	(117	)
Net cash provided by (used in) operating activities	306		591		331		147		(10,885	)	99		150		244		87		51
Investing activities:
Capital expenditures for property and equipment	(306	)	(586	)	(331	)	(147	)	(48	)	(99	)	(150	)	(244	)	(87	)	(51	)
Proceeds from sales of assets	—		—		—		—		11,600		—		—		—		—		—
Net payments from (advances to) Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
(Increase) decrease in restricted cash	—		—		—		—		—		—		—		—		—		—
Costs associated with disposition program and other, net	—		—		—		—		(667	)	—		—		—		—		—
Net cash provided by (used in) investing activities	(306	)	(586	)	(331	)	(147	)	10,885		(99	)	(150	)	(244	)	(87	)	(51	)
Financing activities:
Prepayments on long-term debt	—		—		—		—		—		—		—		—		—		—
Scheduled payments on long-term debt	—		—		—		—		—		—		—		—		—		—
Proceeds from issuance of long-term debt	—		(5	)	—		—		—		—		—		—		—		—
Loans to/from subsidiaries	—		—		—		—		—		—		—		—		—		—
Contributions from partners	—		—		—		—		—		—		—		—		—		—
Distributions paid to minority investors	—		—		—		—		—		—		—		—		—		—
Net cash provided by (used in) financing activities	—		(5	)	—		—		—		—		—		—		—		—
Effect of exchange rate changes on cash	—		—		—		—		—		—		—		—		—		—
Net increase (decrease) in cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, beginning of year	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, end of year	—		—		—		—		—		—		—		—		—		—

59

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2002 (Dollars in thousands)

	MeriStar Sub 7A Joint Venture		MeriStar Sub 6K, LLC		MeriStar Sub 2B, LLC		MeriStar Sub 3A, LLC		MeriStar Sub 4A, L.P.		MeriStar Sub 4D, LLC		MeriStar Sub 2A, LLC		MeriStar Sub 6L, LLC		MDV Limited Partnership		MeriStar Sub 5C, LLC
Operating activities:
Net income (loss)	638		2,819		(464	)	195		(2,398	)	(3,591	)	(605	)	658		246		267
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	416		736		417		256		—		311		320		890		137		597
Equity in earnings of affiliate	—		—		—		—		—		—		—		—		—		—
Loss on asset impairments	—		—		—		—		3,170		3,617		—		—		—		—
Loss on sale of assets, before tax effect	—		—		—		—		—		—		—		—		—		—
Loss on fair value of non-hedging derivatives	—		—		—		—		—		—		—		—		—		—
Write down of note receivable with Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
Minority interests	—		—		—		—		—		—		—		—		—		—
Amortization of unearned stock based compensation	—		—		—		—		—		—		—		—		—		—
Change in value of interest rate swaps	—		—		—		—		—		—		—		—		—		—
Deferred income taxes	—		—		—		—		—		—		—		—		—		—
Changes in operating assets and liabilities:	—		—		—		—		—		—		—		—		—		—
Accounts receivable	—		—		—		—		—		—		—		—		—		—
Prepaid expenses and other assets	—		—		—		—		—		—		—		—		4		(53	)
Due from/to Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
Due from subsidiaries	(767	)	(3,386	)	192		242		(525	)	90		271		(1,325	)	(373	)	(587	)
Accounts payable, accrued expenses, accrued interest and other liabilities	(12	)	44		64		65		33		49		34		(16	)	8		38
Net cash provided by (used in) operating activities	275		213		209		758		280		476		20		207		22		262
Investing activities:
Capital expenditures for property and equipment	(270	)	(213	)	(248	)	(758	)	(280	)	(476	)	(85	)	(207	)	(22	)	(262	)
Proceeds from sales of assets	—		—		—		—		—		—		—		—		—		—
Net payments from (advances to) Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
(Increase) decrease in restricted cash	—		—		—		—		—		—		—		—		—		—
Costs associated with disposition program and other, net	—		—		—		—		—		—		—		—		—		—
Net cash provided by (used in) investing activities	(270	)	(213	)	(248	)	(758	)	(280	)	(476	)	(85	)	(207	)	(22	)	(262	)
Financing activities:
Prepayments on long-term debt	—		—		—		—		—		—		—		—		—		—
Scheduled payments on long-term debt	—		—		—		—		—		—		—		—		—		—
Proceeds from issuance of long-term debt	(5	)	—		39		—		—		—		65		—		—		—
Loans to/from subsidiaries	—		—		—		—		—		—		—		—		—		—
Contributions from partners	—		—		—		—		—		—		—		—		—		—
Distributions paid to minority investors	—		—		—		—		—		—		—		—		—		—
Net cash provided by (used in) financing activities	(5	)	—		39		—		—		—		65		—		—		—
Effect of exchange rate changes on cash	—		—		—		—		—		—		—		—		—		—
Net increase (decrease) in cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, beginning of year	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, end of year	—		—		—		—		—		—		—		—		—		—

60

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2002 (Dollars in thousands)

	MeriStar Sub 6J, LLC		MeriStar Sub 1D, LLC		MeriStar Sub 7B, L.P.		MeriStar Sub 7D, LLC		MeriStar Sub 7G, LLC		MeriStar Sub 6B, LLC		MeriStar Sub 4I, L.P.		MeriStar Sub 5D, LLC		MeriStar Sub 5H, LLC		MeriStar Sub 7H, LLC
Operating activities:
Net income (loss)	1,564		1,875		(6,877	)	2,208		(393	)	517		(5,445	)	(1,257	)	615		484
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	647		2,286		929		1,660		753		456		437		1,450		1,976		395
Equity in earnings of affiliate	—		—		—		—		—		—		—		—		—		—
Loss on asset impairments	—		—		6,925		—		—		—		4,803		—		—		22
Loss on sale of assets, before tax effect	—		—		—		—		—		—		—		—		—		—
Loss on fair value of non-hedging derivatives	—		—		—		—		—		—		—		—		—		—
Write down of note receivable with Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
Minority interests	—		—		—		—		—		—		—		—		—		—
Amortization of unearned stock based compensation	—		—		—		—		—		—		—		—		—		—
Change in value of interest rate swaps	—		—		—		—		—		—		—		—		—		—
Deferred income taxes	—		—		—		—		—		—		—		—		—		—
Changes in operating assets and liabilities:	—		—		—		—		—		—		—		—		—		—
Accounts receivable	—		—		—		(114	)	—		—		—		—		—		—
Prepaid expenses and other assets	—		—		—		—		—		—		—		—		—		—
Due from/to Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
Due from subsidiaries	(1,909	)	(3,161	)	(1,069	)	(3,465	)	(78	)	(821	)	394		236		(1,905	)	(575	)
Accounts payable, accrued expenses, accrued interest and other liabilities	(59	)	(473	)	137		(136	)	(124	)	(35	)	51		(36	)	261		(147	)
Net cash provided by (used in) operating activities	243		527		45		153		158		117		240		393		947		179
Investing activities:
Capital expenditures for property and equipment	(243	)	(527	)	(45	)	(153	)	(158	)	(117	)	(240	)	(396	)	(947	)	(179	)
Proceeds from sales of assets	—		—		—		—		—		—		—		—		—		—
Net payments from (advances to) Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
(Increase) decrease in restricted cash	—		—		—		—		—		—		—		—		—		—
Costs associated with disposition program and other, net	—		—		—		—		—		—		—		—		—		—
Net cash provided by (used in) investing activities	(243	)	(527	)	(45	)	(153	)	(158	)	(117	)	(240	)	(396	)	(947	)	(179	)
Financing activities:
Prepayments on long-term debt	—		—		—		—		—		—		—		—		—		—
Scheduled payments on long-term debt	—		—		—		—		—		—		—		—		—		—
Proceeds from issuance of long-term debt	—		—		—		—		—		—		—		3		—		—
Loans to/from subsidiaries	—		—		—		—		—		—		—		—		—		—
Contributions from partners	—		—		—		—		—		—		—		—		—		—
Distributions paid to minority investors	—		—		—		—		—		—		—		—		—		—
Net cash provided by (used in) financing activities	—		—		—		—		—		—		—		3		—		—
Effect of exchange rate changes on cash	—		—		—		—		—		—		—		—		—		—
Net increase (decrease) in cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, beginning of year	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, end of year	—		—		—		—		—		—		—		—		—		—

61

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2002 (Dollars in thousands)

	AGH PSS I, Inc.		MeriStar Sub 2D, LLC		MeriStar Sub 4F, L.P.		MeriStar Sub 5K, LLC		MeriStar Sub 5M, LLC		MeriStar Sub 1E, LLC		MeriStar Sub 5O, LLC		MeriStar Sub 6M Company		MeriStar Sub 4B, L.P.		MeriStar Sub 6C, LLC
Operating activities:
Net income (loss)	1,639		(224	)	412		970		881		1,216		392		2,794		(4,245	)	2,011
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	—		474		1,122		1,187		454		298		219		1,211		521		777
Equity in earnings of affiliate	—		—		—		—		—		—		—		—		—		—
Loss on asset impairments	—		—		—		—		—		—		—		—		3,780		—
Loss on sale of assets, before tax effect	—		—		—		—		—		—		—		—		—		—
Loss on fair value of non-hedging derivatives	—		—		—		—		—		—		—		—		—		—
Write down of note receivable with Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
Minority interests	—		—		—		—		—		—		—		—		—		—
Amortization of unearned stock based compensation	—		—		—		—		—		—		—		—		—		—
Change in value of interest rate swaps	—		—		—		—		—		—		—		—		—		—
Deferred income taxes	—		—		—		—		—		—		—		—		—		—
Changes in operating assets and liabilities:	—		—		—		—		—		—		—		—		—		—
Accounts receivable	—		—		—		—		—		—		—		—		—		—
Prepaid expenses and other assets	—		—		—		—		—		—		—		13		—		—
Due from/to Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
Due from subsidiaries	(1,179	)	(189	)	(1,100	)	(76	)	(1,257	)	(1,427	)	(547	)	(3,749	)	1,226		(2,412	)
Accounts payable, accrued expenses, accrued interest and other liabilities	78		20		11		(1,328	)	27		(9	)	(11	)	(18	)	109		(14	)
Net cash provided by (used in) operating activities	538		81		445		753		105		78		53		251		1,391		362
Investing activities:
Capital expenditures for property and equipment	(538	)	(158	)	(445	)	(753	)	(105	)	(78	)	(53	)	(251	)	(1,391	)	(362	)
Proceeds from sales of assets	—		—		—		—		—		—		—		—		—		—
Net payments from (advances to) Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
(Increase) decrease in restricted cash	—		—		—		—		—		—		—		—		—		—
Costs associated with disposition program and other, net	—		—		—		—		—		—		—		—		—		—
Net cash provided by (used in) investing activities	(538	)	(158	)	(445	)	(753	)	(105	)	(78	)	(53	)	(251	)	(1,391	)	(362	)
Financing activities:
Prepayments on long-term debt	—		—		—		—		—		—		—		—		—		—
Scheduled payments on long-term debt	—		—		—		—		—		—		—		—		—		—
Proceeds from issuance of long-term debt	—		77		—		—		—		—		—		—		—		—
Loans to/from subsidiaries	—		—		—		—		—		—		—		—		—		—
Contributions from partners	—		—		—		—		—		—		—		—		—		—
Distributions paid to minority investors	—		—		—		—		—		—		—		—		—		—
Net cash provided by (used in) financing activities	—		77		—		—		—		—		—		—		—		—
Effect of exchange rate changes on cash	—		—		—		—		—		—		—		—		—		—
Net increase (decrease) in cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, beginning of year	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, end of year	—		—		—		—		—		—		—		—		—		—

62

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2002 (Dollars in thousands)

	MeriStar Sub 2C, LLC		MeriStar Sub 4G, L.P.		MeriStar Sub 3B, LLC		MeriStar Sub 5G, L.P.		MeriStar Sub 5P, LLC		MeriStar Sub 5J, LLC		MeriStar Sub 5Q, LLC		MeriStar Sub 5A, LLC		MeriStar Sub 8D, LLC		MeriStar Sub 4J, LLC
Operating activities:
Net income (loss)	(1,248	)	809		(12,777	)	2,429		589		3,784		1,164		970		651		1,444
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	1,035		921		921		6,201		3		3,475		494		1,434		1,267		1,343
Equity in earnings of affiliate	—		—		—		—		—		—		—		—		—		—
Loss on asset impairments	—		—		12,724		—		—		—		—		—		—		—
Loss on sale of assets, before tax effect	—		—		—		—		—		—		—		—		—		—
Loss on fair value of non-hedging derivatives	—		—		—		—		—		—		—		—		—		—
Write down of note receivable with Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
Minority interests	—		—		—		—		—		—		—		—		—		—
Amortization of unearned stock based compensation	—		—		—		—		—		—		—		—		—		—
Change in value of interest rate swaps	—		—		—		—		—		—		—		—		—		—
Deferred income taxes	—		—		—		—		—		—		—		—		—		—
Changes in operating assets and liabilities:	—		—		—		—		—		—		—		—		—		—
Accounts receivable	—		—		—		—		319		—		—		—		—		45
Prepaid expenses and other assets	—		—		—		—		—		483		—		—		1		—
Due from/to Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
Due from subsidiaries	455		(1,606	)	(338	)	(7,331	)	(857	)	(4,787	)	(1,192	)	(2,153	)	(1,634	)	(2,529	)
Accounts payable, accrued expenses, accrued interest and other liabilities	(17	)	(16	)	58		160		(15	)	135		79		67		(46	)	(72	)
Net cash provided by (used in) operating activities	225		108		588		1,459		39		3,090		545		318		239		231
Investing activities:
Capital expenditures for property and equipment	(358	)	(108	)	(588	)	(1,454	)	(39	)	(3,090	)	(545	)	(318	)	(239	)	(231	)
Proceeds from sales of assets	—		—		—		—		—		—		—		—		—		—
Net payments from (advances to) Interstate Hotels & Resorts	—		—		—		—		—		—		—		—		—		—
(Increase) decrease in restricted cash	—		—		—		—		—		—		—		—		—		—
Costs associated with disposition program and other, net	—		—		—		—		—		—		—		—		—		—
Net cash provided by (used in) investing activities	(358	)	(108	)	(588	)	(1,454	)	(39	)	(3,090	)	(545	)	(318	)	(239	)	(231	)
Financing activities:
Prepayments on long-term debt	—		—		—		—		—		—		—		—		—		—
Scheduled payments on long-term debt	—		—		—		—		—		—		—		—		—		—
Proceeds from issuance of long-term debt	133		—		—		(5	)	—		—		—		—		—		—
Loans to/from subsidiaries	—		—		—		—		—		—		—		—		—		—
Contributions from partners	—		—		—		—		—		—		—		—		—		—
Distributions paid to minority investors	—		—		—		—		—		—		—		—		—		—
Net cash provided by (used in) financing activities	133		—		—		(5	)	—		—		—		—		—		—
Effect of exchange rate changes on cash	—		—		—		—		—		—		—		—		—		—
Net increase (decrease) in cash and cash equivalents	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, beginning of year	—		—		—		—		—		—		—		—		—		—
Cash and cash equivalents, end of year	—		—		—		—		—		—		—		—		—		—

63

MeriStar Hospitality Operating Partnership, L.P.

Consolidated Statement of Cash Flows

Year Ended December 31, 2002 (Dollars in thousands)

	Meristar Acquisition Company, LLC	MeriStar Sub 6I, LLC	MeriStar Sub 6A, LLC	MeriStar Sub 6F, LLC	MeriStar Sub 5I, LLC	CapStar Cherry Hill Company, LLC	MeriStar Hotel Lessee, Inc.		Guarantor Subsidiaries Total		Eliminations		Total Consolidated
Operating activities:
Net income (loss)	—	—	—	—	—	—	(23,892	)	(31,560	)	33,753		$	(170,819	)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	—	—	—	—	—	—	4,874		61,464		—			125,365
Equity in earnings of affiliate	—	—	—	—	—	—	—		—		(33,753	)		—
Loss on asset impairments	—	—	—	—	—	—	—		55,152		—			78,732
Loss on sale of assets, before tax effect	—	—	—	—	—	—	—		6,390		—			21,197
Loss on fair value of non-hedging derivatives	—	—	—	—	—	—	—		—		—			4,735
Write down of note receivable with Interstate Hotels & Resorts	—	—	—	—	—	—	—		—		—			14,517
Minority interests	—	—	—	—	—	—	—		—		—			(15	)
Amortization of unearned stock based compensation	—	—	—	—	—	—	—		—		—			4,543
Change in value of interest rate swaps	—	—	—	—	—	—	—		—		—			(7,612	)
Deferred income taxes	—	—	—	—	—	—	—		(128	)	—			(2,271	)
Changes in operating assets and liabilities:	—	—	—	—	—	—	—		—		—			—
Accounts receivable	—	—	—	—	—	—	(1,785	)	(1,669	)	—			(9,650	)
Prepaid expenses and other assets	—	—	—	—	—	—	(1,485	)	(1,032	)	—			(3,401	)
Due from/to Interstate Hotels & Resorts	—	—	—	—	—	—	6,613		6,613		—			6,757
Due from subsidiaries	—	—	—	—	—	—	4,429		(96,979	)	—			—
Accounts payable, accrued expenses, accrued interest and other liabilities	—	—	—	—	—	—	14		99		—			(4,180	)
Net cash provided by (used in) operating activities	—	—	—	—	—	—	(11,232	)	(1,650	)	—			57,898
Investing activities:
Capital expenditures for property and equipment	—	—	—	—	—	—	(1,387	)	(28,023	)	—			(47,347	)
Proceeds from sales of assets	—	—	—	—	—	—	—		17,870		—			60,650
Net payments from (advances to) Interstate Hotels & Resorts	—	—	—	—	—	—	(775	)	(775	)	—			(7,500	)
(Increase) decrease in restricted cash	—	—	—	—	—	—	—		—		—			939
Costs associated with disposition program and other, net	—	—	—	—	—	—	—		(1,118	)	—			(2,476	)
Net cash provided by (used in) investing activities	—	—	—	—	—	—	(2,162	)	(12,046	)	—			4,266
Financing activities:
Prepayments on long-term debt	—	—	—	—	—	—	—		—		—			(333,000	)
Scheduled payments on long-term debt	—	—	—	—	—	—	—		—		—			(19,466	)
Proceeds from issuance of long-term debt	—	—	—	—	—	—	—		302		—			300,452
Loans to/from subsidiaries	—	—	—	—	—	—	15,396		15,396		—			—
Contributions from partners	—	—	—	—	—	—	—		—		—			3,153
Distributions paid to minority investors	—	—	—	—	—	—	—		—		—			(3,060	)
Net cash provided by (used in) financing activities	—	—	—	—	—	—	15,396		15,698		—			(51,921	)
Effect of exchange rate changes on cash	—	—	—	—	—	—	—		—		—			205
Net increase (decrease) in cash and cash equivalents	—	—	—	—	—	—	2,002		2,002		—			10,448
Cash and cash equivalents, beginning of year	—	—	—	—	—	—	16,643		16,643		—			23,441
Cash and cash equivalents, end of year	—	—	—	—	—	—	18,645		18,645		—		$	33,889

64