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EXHIBIT 10.16

May 7, 1996

Winston Hotels, Inc.
WINN Limited Partnership
c/o Mr. Robert W. Winston, III
2209 Century Drive
Raleigh, NC 27612

Re: $17,000,000 Unsecured Line of Credit

Dear Ladies/Gentlemen:

This letter constitutes the commitment (the "Commitment") of Wachovia
Bank of North Carolina, N.A. ("Wachovia") and Branch Banking & Trust Company
("BB&T") (Wachovia and BB&T being collectively referred to as the "Banks") to
make an unsecured line of credit available (the "Line"), on a pro rata basis as
set out below under Paragraph II.1, to the borrower described below (the
"Borrower") under the following terms and conditions.

I. GENERAL PROVISIONS

1. Borrower: Winston Hotels, Inc., a North Carolina corporation (the
"Company"), and WINN Limited Partnership, a North Carolina limited partnership
(the "Partnership"). The Company and the Partnership shall be jointly and
severally liable for all obligations of the "Borrower."

2. Maximum Line Amount: $17,000,000.00 (the "Maximum Line Amount"). As
used herein, the term "loan" shall include any line of credit, advance,
drawing, debit, liability, and any other obligation of the Borrower to the
Banks arising out of this commitment.

3. Term: The term of this Line shall expire on July 31, 1996.

4. Loan Interest Rate: A rate per annum (computed on the basis of a
360-day year for the actual number of days in each Interest Period) equal to
the "Adjusted London Interbank Offered Rate" plus 1.75%. Adjusted London
Interbank Offered Rate applicable to any Interest Period, which for purposes
hereof shall be each successive 30-day period from the date of the Note, means
a rate per annum equal to the quotient obtained by dividing (i) the applicable
London Interbank Offered ("LIBO") Rate for such Interest Period by (ii) 1.00
minus the Eurodollar Reserve Percentage.

"LIBO Rate" means for an Interest Period the rate per annum at which United
States dollars of amounts equal to or comparable to the principal amount of the
borrowing for which such LIBO Rate has been selected are offered for a term
comparable to the Interest Period in the London interbank

Winston Hotels, Inc.
WINN Limited Partnership
May 7, 1996
Page 2

market, which rate appears on the display designated as Page "3750" of the
Telerate Service or such other page as may replace Page "3750" of that service
or or such other service or services as may be nominated by the British
Bankers' Association for the purpose of displaying the London Interbank Offered
Rates for United States dollar deposits (the "3750 Telerate Service")
determined as of 11:00 a.m. London time, as that rate is set three (3)
Eurodollar business days (i.e., any day on which dealings in United States
dollar deposits are carried out in the London interbank market except Saturday,
Sunday, or other day on which commercial banks in North Carolina are authorized
by law to close) prior to the first day of the Interest Period provided that
(i) if more than one such offered rate appears on the applicable Telerate
Service, the LIBO Rate will be the arithmetic average of such offered rates;
(ii) if no such offered rates appear on such page or if there is no such
service nominated by the British Bankers' Association, the LIBO Rate for such
Interest Period will be the arithmetic average of rates (rounded upward, if
necessary, to the next higher 1/100 of 1%) quoted by not less than two (2)
major banks in the United States, selected by Wachovia at approximately 10:00
a.m., New York City time, two (2) Eurodollar business days prior to the first
day of such Interest Period, for deposits in United States dollars offered in
the London Interbank market in amounts comparable to the principal amount of
the borrowing for which such LIBO Rate has been selected and for a term
comparable to the Interest Period.

"Eurodollar Reserve Percentage" means for any day that percentage (expressed as
a decimal) which is in effect on such day, as prescribed by the Board of
Governors of the Federal Reserve System (or any successor) for determining the
maximum reserve requirement for a member bank of the Federal Reserve System in
respect of "Eurocurrency liabilities". The Eurodollar Reserve Percentage shall
be adjusted automatically on and as of the effective date of any change in the
Eurodollar Reserve Percentage.

If, as a result of any Regulatory Change (as defined below):

a. The basis of taxation of the payments to any of the Banks of
the principal of, or interest on, such LIBO Rate loan, as
applicable (other than taxes imposed on the overall net income
of such Bank or of any of its lending offices) is changed; or

b. Any reserve, special deposit or similar requirements (other
than any change by way of imposition or increase in the
Eurodollar Reserve Percentage) relating to such loan is
imposed or modified;

Winston Hotels, Inc.
WINN Limited Partnership
May 7, 1996
Page 3

and as a result thereof, the cost to any Bank of making, maintaining, or
funding such loan is increased (the "Increased Cost"), then the Borrower shall
pay to such Bank such additional amount or amounts as will compensate the Bank
for the Increased Cost, subject to the conditions set forth below. Each Bank
will notify the Borrower of the nature and effective date of the applicable
Regulatory Change and calculation of the Increased Cost resulting therefrom as
soon as is reasonably possible. The effective date of such Regulatory Change
will not be applied retroactively but will be applied at the beginning of the
applicable Interest Period.

"Regulatory Change" shall mean the adoption or making after the date of this
Commitment of any laws or regulations (or a written interpretation or ruling as
to the effect or application of such laws or regulations having the force of
law) by any federal, state, or foreign government or governmental agency having
authority over the administration thereof, which are applicable to any LIBO
Rate loans made pursuant to this Commitment.

If at any time the Banks determine in good faith that the effective LIBO Rate
for any loan is unascertainable, or that the making or continuance of such loan
at the LIBO Rate would be unlawful, the Banks shall not be required to make or
continue such loan at such Rate. In such event, such loan shall be made or
continued, as applicable, at the following rate: Prime Rate plus zero percent.

5. Unused Line Fee: Beginning on the date of the Note, a fee of 1/8 of
one percent (.125%) of the average unused portion of the Maximum Line Amount
for the term of the Note shall be due and payable to Wachovia, for the pro rata
benefit of the Banks, within ten (10) days after the Maturity Date (as
hereinafter defined).

6. Loan Purpose: Proceeds of the Line shall be utilized: (a) for the
purchase of hotel properties and land described in Exhibit A attached hereto
and made a part hereof (the "New Hotels"); and (b) for general working capital
purposes.

7. Repayment Terms: Interest only, at the interest rate set forth
herein, shall be due and payable in arrears at the end of each Interest Period
with respect to principal from time to time outstanding. All outstanding
principal and accrued interest shall be due and payable in full on July 31,
1996, unless payment has been accelerated by the Bank pursuant to the terms
hereof (the "Maturity Date").

8. Prepayment Privilege: Borrower shall have the right to prepay the
principal and accrued interest in full or in part at anytime without a
prepayment premium. Notwithstanding any contrary provision contained herein,
at anytime any portion of the Line bears interest based on the London Interbank
Offered Rate, that portion of the Line may not be prepaid until maturity of the
then current Interest Period.

Winston Hotels, Inc.
WINN Limited Partnership
May 7, 1996
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9. Line of Credit Administration: Each Bank shall retain the Note made
payable to such Bank. Each Bank shall be responsible for monthly billing of
interest under its Note. The Borrower shall submit disbursement requests to
Wachovia not less than forty-eight hours prior to the requested disbursement
date (but at least two Eurodollar business days in the case of LIBO-based
borrowings), with the exception of the first disbursement request, specifying:
(1) the amount requested; and (2) any other information that the Banks may
reasonably request.

II. REQUIRED LOAN DOCUMENTATION AND INFORMATION

Prior to the Closing and the disbursement of any funds thereunder, the
Banks shall require, in form and content satisfactory to the Banks and their
counsel, the following:

1. Note: The Line shall be evidenced by two promissory notes of the
Borrower (the "Notes"), in the amounts set out below for the Banks identified
below:

Wachovia $10,000,000.00
BB&T $ 7,000,000.00

Each Note shall provide that after the Note becomes due, whether by
acceleration or otherwise, the Note shall bear interest at the rate per annum
equal to 150% of the Prime Rate, in lieu of interest at the LIBO interest rate
hereinabove provided.

2. Director's Resolution; Certificate of Incumbency; Good Standing
Certificate Partnership Documents: (1) a Director's Resolution authorizing the
Line, and the execution of the Line documents by the appropriate officers of
the Company, (2) a certificate of incumbency evidencing the appropriate
officers of the Company and specimen signatures of such officers, and (3) a
good standing certificate from the state of its incorporation. In addition, in
the case of the Partnership, the Borrower shall also provide a certified true
copy of the Partnership Agreement (with all amendments thereto) of the
Partnership, and certified true copies of its Certificate of Limited
Partnership and its Agreement of Limited Partnership (with all amendments
thereto), together with evidence that (a) the partners executing the loan
documents or the guarantee thereof, as the case may be, have appropriate
authority to bind the Partnership and (b) the Partnership is in good standing
in the state wherein it was formed.

3. Disbursements: Individual draws made under the Line shall be limited
to amounts of $1,000,000 or more, and in increments of $100,000 for borrowings
in excess of $1,000,000. Disbursements shall be subject to a mutually
acceptable draw request procedure. For each draw, Borrower agrees to provide
the Banks with satisfactory written documentation supporting the purpose and
amount being requested.

R#COMMIT2.WPD
5

Winston Hotels, Inc.
WINN Limited Partnership
May 7, 1996
Page 5

4. Negative Covenant. Until payment in full of the Line and interest
thereon, the Borrower covenants that it will not, without the prior written
consent of the Banks:

- Sell, lease, convey, or otherwise dispose of any of the New
Hotels; or

- Incur or permit to exist any encumbrance (including capital
leases), security interest, pledge, or lien against any of the
New Hotels.

5. Affirmative Covenants. The Borrower covenants and agrees that in the
event the $125,000,000 line of credit contemplated in that certain commitment
letter between the Banks, SouthTrust Bank of Alabama, N.A. ("SouthTrust"), and
NationsBank, N.A. ("NationsBank"), dated April 24, 1996 (the "$125,000,000
Commitment Letter"), does not close on or before July 31, 1996, or if the
Borrower withdraws its pending Public Offering, or if for any reason such
pending Public Offering is withdrawn, or does not occur by July 31, 1996, then
in such event the Borrower agrees to:

- Secure this Line with the New Hotels and provide to the Banks
all the various types of documentation required in the
$125,000,000 Commitment Letter with respect to the New Hotels;
and

- Enter into a cross default/cross collateralization agreement
with Wachovia cross defaulting and cross collateralizing this
Line with the $50,000,000 Note evidencing the line of credit
between Wachovia and the Borrower, dated May 15, 1995 (the
"$50,000,000 Line").

6. Additional Items: Such other matters and items as the Banks or their
counsel may reasonably request.

III. OTHER CONDITIONS

1. Costs; Cross Default.

a. Costs: The Line herein referenced shall be closed without
cost to the Banks, and all expenses incurred in connection
with the origination of the Line (including, without
limitation, the Banks' counsel's fees) are to be paid by the
Borrower. Such expenses shall be paid by the Borrower whether
or not the Line closes.

b. Modification and Refinance Fees: Any modification or
refinance of the Line may be conditioned by the Banks on the
payment by the Borrower of a nonrefundable fee, which shall be
in addition to any other fee paid by the Borrower to the Banks
in

Winston Hotels, Inc.
WINN Limited Partnership
May 7, 1996
Page 6

connection with the Line. Nothing in this paragraph shall
obligate the Banks to modify or refinance the Line, and the
Banks reserve the right to require the Line to be repaid
strictly in accordance with the terms and conditions contained
in the Notes.

c. Cross Default. Any default by the Borrower under its note,
deed of trust or other document evidencing, documenting or
securing the $50,000,000 Line shall, at the option of the
Banks, constitute a default by the Borrower in the Notes, or
any other document evidencing, documenting or securing this
Line. Any default by the Borrower in the Notes or any other
document evidencing, documenting, or securing this Line shall,
at the option of Wachovia, constitute a default by the
Borrower in the $50,000,000 Line.

2. General Conditions:

a. The Borrower understands and agrees that this Commitment is
issued directly to the Borrower and cannot be assigned without
the prior written consent of the Banks. The Commitment is for
the sole and exclusive benefit of the Borrower, and no third
party is intended to be benefited in any respect hereby. If,
prior to the origination of the Line, there is any material
adverse change in the condition (financial, business or
otherwise) of the Borrower or if, prior to closing, Winston
Hotels, Inc. ceases to be the sole general partner of the
Partnership, the Banks shall have the right to terminate their
obligations hereunder.

b. If the Borrower (and if either is a partnership, any partner
thereof) at or before the closing of the Line should file a
petition in bankruptcy under any of the provisions of the
bankruptcy laws, or if a petition in bankruptcy should be
filed against any one of them, or if any of them should make
an assignment for the benefit of creditors, or otherwise
become insolvent, or if any of them should become deceased or
become mentally incapacitated, this Commitment may be
cancelled at the option of the Banks.

c. The Borrower by accepting this Commitment represents and
warrants to the Banks that except as disclosed to the Banks in
writing on or prior to the date hereof, there are no actions,
claims, suits or proceedings pending, or to the Borrower's
knowledge, threatened or reasonably anticipated against or
affecting the Borrower at law or in equity or before or by any
governmental authority and there is no possibility of any
judgment, liability or award which may reasonably be expected
to result in any material and adverse change in the Borrower's
condition (financial, business or otherwise).

Winston Hotels, Inc.
WINN Limited Partnership
May 7, 1996
Page 7

d. The Borrower understands that the Banks are relying upon the
statements and representations made to the Banks and upon such
additional data as may be supplied to the Banks for the
purpose of evaluating the Line request. If any of such
information is found to be inaccurate or to have been
misrepresented in any material respect, this Commitment may be
cancelled at the option of the Banks.

e. The Borrower certifies that all information provided to the
Banks by the Borrower is true and complete in all respects to
the best of the Borrower's knowledge and that the same was
given to induce the Banks to make a line of credit available
as herein requested.

f. If this commitment is being signed by less than all parties
(i.e. Borrower, partners of the Borrower), the undersigned
hereby certifies and warrants to the Banks that the
undersigned has been duly authorized to execute and deliver
this Commitment for and on behalf of, and as agent for, any
such party whose signature does not appear below.

g. If this Commitment is acceptable, please so indicate by
signing in the space provided on the enclosed copy of this
letter and return same to us not later than May 10, 1996. If
not so accepted, or if the Line is not closed by May 17, 1996,
the Banks may on the occurrence of either event void this
Commitment at their sole option.

Very truly yours,

WACHOVIA BANK OF NORTH CAROLINA, N.A.

By: /s/
---------------------------------------------
Jeffrey P. Castleberry
Senior Vice President

BRANCH BANKING & TRUST COMPANY

By: /s/
---------------------------------------------
Richard E. Fowler
Senior Vice President

Winston Hotels, Inc.
WINN Limited Partnership
May 7, 1996
Page 8

ACCEPTED THIS THE _____ DAY OF MAY, 1996.

WINN LIMITED PARTNERSHIP,
a North Carolina limited partnership (SEAL)

By: WINSTON HOTELS, INC.
its General Partner
Attest:

By:
- - ---------------------------------- ------------------------------------------------
President
Secretary
- - --------------

[CORPORATE SEAL]

WINSTON HOTELS, INC.
Attest:

By:
- - --------------------------------- -------------------------------------------------
President
Secretary
- - --------------

[CORPORATE SEAL]

EXHIBIT A

NEW HOTELS

Address City County State Rooms/Suites Franchise
------- ---- ------ ----- ------------ ---------

1. 940 East Main Street Abingdon Washington VA 80 Holiday Inn Express
2. 4154 Preferred Place Duncansville Dallas TX 119 Hampton Inn
3. 11350 LBJ Freeway Garland City Dallas TX 244 Holiday Inn Select
4. 540 North Pleasantburg Drive Greenville Greenville SC 191 Comfort Inn
5. 1918 West Highway 192 London [not provided] KY 62 Comfort Suites
6. East Main Street Abingdon Washington VA 1.0ac. Vacant Land
7. 1918 West Highway 192 London [not provided] KY 2.2ac. Vacant Land