NOTE 3 - ACQUISITIONS

We acquired five hotels during 2011. We purchased the Homewood Suites in Ridgeland, MS on April 15, 2011 for approximately $7.3 million, the Staybridge Suites in Glendale, CO on April 27, 2011 for approximately $10.0 million, the Holiday Inn in Duluth, GA on April 27, 2011 for approximately $7.0 million, and the Hilton Garden Inn in Duluth, GA for approximately $13.4 million on May 25, 2011. We purchased the Courtyard by Marriott in El Paso, TX on July 28, 2011 for approximately $12.4 million. The purchases were financed with borrowings under our revolving credit facility. We did not acquire any intangibles or assume any debt related to these five acquisitions.

We have acquired three hotels during the first quarter of 2012. We purchased the Courtyard by Marriott in Atlanta, GA on January 12, 2012 for approximately $28.5 million, the Hilton Garden Inn in Birmingham, AL for approximately $11.5 million on February 28, 2012, and another Hilton Garden Inn in Birmingham, AL for approximately $8.6 million on February 28, 2012. The allocations of fair value for the assets acquired and liabilities assumed for the Courtyard by Marriott in Atlanta, GA are estimated based on available information, however, we are still in the process of finalizing our accounting for this transaction.

The following table illustrates our initial allocation of the aggregated purchase prices for the hotel acquisitions discussed above during 2011 and 2012:

	2012		2011
	(in thousands)		(in thousands)

Land	$	4,850	$	7,254
Hotel buildings and improvements		40,950		41,368
Furniture, fixtures and equipment		2,825		1,428
Current assets		187		365
Total assets acquired	$	48,812	$	50,415
Current liabilities		63		398
Debt acquired		19,011		-
Total liabilities acquired		19,074		398
Net assets acquired	$	29,738	$	50,017

Total revenues and net income (loss) from the acquired hotels during the three months ended March 31, 2012, which are included in the accompanying unaudited condensed consolidated statements of operations, were as follows (in thousands):

	2012 acquisitions
	For the three months ended
	March 31, 2012
Revenue	$	1,781
Net income	$	385

	2011 acquisitions
	For the three months ended
	March 31, 2012
Revenue	$	3,972
Net income	$	601

The following unaudited condensed pro forma financial information presents the results of operations as if the 2012 and 2011 acquisitions had taken place on January 1, 2011. The condensed pro forma financial information excludes discontinued operations and is not necessarily indicative of what actual results of operations of the Company would have been assuming the acquisitions had taken place on January 1, 2011, nor does it purport to represent the results of operations for future periods. The unaudited condensed pro forma financial information, excluding discontinued operations, is as follows (in thousands, except per share data):

	For the three months ended
	March 31, 2012			March 31, 2011
Revenue	$	41,091		$	37,961
Net income (loss)	$	(4,095	)	$	(8,210	)
Net income (loss) per share
attributable to common
shareholders - basic and diluted	$	(0.11	)	$	(0.22	)