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Hearing Date: September 30, 2010 at 10:00 a.m. Objection Deadline: September 24, 2010 at 4:00 p.m.

DECHERT LLP 1095 Avenue of the Americas New York, New York 10036-6797 Telephone: (212) 698-3500 Facsimile: (212) 698-3599 Michael J. Sage Brian E. Greer Andrew L. Buck Attorneys for Lehman ALI Inc. UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ------------------------------------------------------------ X : In re: : Chapter 11 : INNKEEPERS USA TRUST, et al. : Case No. 10-13800 : Debtors. : Jointly Administered : ------------------------------------------------------------ X OBJECTION OF LEHMAN ALI INC. TO MOTION OF AD HOC COMMITTEE OF PREFERRED SHAREHOLDERS FOR ORDER DIRECTING APPOINTMENT OF STATUTORY COMMITTEE OF PREFERRED SHAREHOLDERS PURSUANT TO BANKRUPTCY CODE SECTION 1102(a)(2) Lehman ALI Inc. (Lehman)1 submits this objection (this Objection) to the Motion of the Ad Hoc Committee of Preferred Shareholders for an Order Directing Appointment of a

Twenty of the Debtors (the Floating Rate Debtors) in the above-captioned cases are borrowers under that certain Loan Agreement, dated as of June 29, 2007, in the original principal amount of $250,000,000.00, between and among the Floating Rate Debtors, as borrowers, and Lehman, as lender (as amended, the Floating Rate Loan Agreement). The Floating Rate Debtors obligations under the Floating Rate Loan Agreement are secured by twenty separate mortgages (each, a Floating Rate Mortgage) that each grant Lehman (i) a first lien mortgage on the applicable hotel property, (ii) a lien on all cash, accounts, and proceeds of the applicable borrower, and (iii) an absolute assignment of rents of the applicable hotel property. The Floating Rate Debtors are: (1) KPA/GP Valencia LLC; (2) Grand Prix West Palm Beach LLC; (3) KPA/GP Ft. Walton Beach LLC; (4) Grand Prix Ft. Wayne LLC; (5) Grand Prix Indianapolis LLC; (6) KPA/GP Louisville (HI) LLC; (7) Grand Prix Bulfinch LLC; (8) Grand Prix Woburn LLC; (9) Grand Prix Rockville LLC; (10) Grand Prix East Lansing LLC; (11) Grand Prix Grand Rapids LLC; (12) Grand Prix Troy (Central) LLC; (13) Grand Prix Troy (SE) LLC; (14) Grand Prix Atlantic City LLC; (15) Grand Prix Montvale LLC; (16) Grand Prix Morristown LLC; (17) Grand Prix Albany LLC; (18) Grand Prix Addison (SS) LLC; (19) Grand Prix Harrisburg LLC; and (20) Grand Prix Ontario LLC.

Statutory Committee of Preferred Shareholders Pursuant to Section 1102(a)(2) of the Bankruptcy Code [Dkt. No. 435] (the Preferred Committee Motion) 2 and respectfully states as follows: 1. As noted in the Preferred Committee Motion, on August 30, 2010, the United

States Trustee denied the Ad Hoc Committees request for the appointment of a statutory equity committee pursuant to 1102(a)(1) of the Bankruptcy Code. Accordingly, such a committee may be appointed only if necessary to assure adequate representation of the preferred shareholders. 11 U.S.C. 1102(a)(2). 2. The Bankruptcy Code does not define adequate representation, but rather leaves

the determination of whether to appoint an equity committee to the discretion of the bankruptcy court based on the facts of the case. See Exide Techs. v. Wis. Inv. Bd., 2002 U.S. Dist. LEXIS 27210, at *3-4 (D. Del. Dec. 23, 2002). As courts in this district have noted, however, the appointment of an official equity committee should be the rare exception and such a committee should not be appointed unless equity holders establish that (i) there is a substantial likelihood that they will receive a meaningful distribution in the case under a strict application of the absolute priority rule and (ii) they are unable to represent their interests in the bankruptcy case without an official committee. In re Williams Commcns Group, Inc., 281 B.R. 216, 220, 223 (Bankr. S.D.N.Y. 2002) (denying appointment of equity committee). 3. Putting aside the question of whether the Ad Hoc Committee can establish here

the substantial likelihood of meaningful distribution for preferred shareholders,3 the notion that

Capitalized terms used but not defined herein shall have the meanings ascribed thereto in the Preferred Committee Motion. Lehman understands that the Debtors believe that such shareholders are out of the money with respect to the Debtors hotel assets.

the preferred shareholders will not be adequately represented throughout these cases absent the appointment of a statutory committee is simply mistaken. 4. To the contrary, the Ad Hoc Committee has aggressively and ably represented the

interests of preferred shareholders since the Petition Date. During the short pendency of these cases, the Ad Hoc Committee has already moved for the appointment of an examiner, objected to and participated extensively at the hearing on the Debtors motion to assume the Plan Support Agreement, and participated actively in discovery. Additionally, Lehman understands that

counsel to the Ad Hoc Committee was contacted by and met with the Debtors advisors following the hearing on the Plan Support Agreement in connection with their efforts to develop a consensual plan of reorganization. In other words, the preferred shareholders have had a zealous advocate for their interests involved at every substantive step during these cases. 5. Moreover, although the Preferred Committee Motion alleges a litany of actions by

the Debtors that purportedly demonstrate the absence of representation of preferred shareholders, the fact remains that those actions, for the most part, took place prior to the bankruptcy cases in connection with the development of the restructuring embodied in the Plan Support Agreement. Indeed, the denial of the Debtors motion to assume the Plan Support Agreement was apparently based, in part, upon arguments advanced by the Ad Hoc Committee itself. Now that the Plan Support Agreement is off the table, the fact that preferred shareholders may not have been directly represented in prepetition negotiations is irrelevant. 6. Given those circumstances, far from providing a voice to unrepresented preferred

shareholders, appointment of a statutory committee of preferred shareholders would do nothing more than add additional expenses to be borne by the estates. Accordingly, the Preferred Committee Motion should be denied.

WHEREFORE, Lehman respectfully requests that the Court deny the Preferred Committee Motion and grant Lehman such other and further relief as the Court deems appropriate. Dated: New York, New York September 24, 2010 DECHERT LLP

By: /s/ Michael J. Sage Michael J. Sage Brian E. Greer Andrew L. Buck 1095 Avenue of the Americas New York, New York 10036 Telephone: (212) 698-3500 Facsimile: (212) 698-3599