Settle Inn Signs Multi-property Development Agreement

John Shaline to Construct up to 12 new Hotels in Wisconsin

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. October 14, 2008

ABERDEEN, SD, October 10, 2006. Settle Inn LLC has signed a multi- property development agreement with a Green Bay, WI. developer to construct up to 12 new hotels in Wisconsin.

The deal with John Shaline and his company, Total Service Development LLC, is a first for Settle Inn. Shaline will build his first Settle Inn & Suites in Grand Chute, WI., along U.S. 41 near Wisconsin's single largest tourist attraction - the Fox River Mall. The hotel is set to break ground in August and open in early 2007 and will have 81 rooms, including 22 suites.

Brendan Watters, the company's chief executive officer, said the agreement is the start of a new era for Settle Inn, which began in 1992 and recently announced a major rebranding program coinciding with its franchising push. "The Wisconsin market holds tremendous promise for our brand and we're delighted to have our first franchisee place a hotel in such a vibrant and growing area of the state," said Watters, who formed Settle Inn LLC with the company's founder, Dave Graf, in 2005.

Watters said he is looking to differentiate Settle Inn & Suites from other chains by offering distinctive customer service and training, along with franchise agreement stipulations that aren't too costly or restrictive for its franchisees. "Settle Inn's deal with Shaline is a key part of the company's plan to expand across the country", said Terry Kline, Settle Inn's senior vice president of franchise sales and development.

"To attract developers to the Settle Inn brands, the company is going back to the basics of franchising, which means creating a close working relationship between the company and franchisees", Kline said. "We want that true relationship with the hotel owners so that they can manage their asset most effectively within our guidelines," he said. "They can decide what programs work for them in their particular market and location."

Kline said the agreements are not the typical franchise deals with high franchisee fees and costly opt-out clauses. For example, after the first 24 months of operation, a franchisee can terminate a contract as long as they give a year's notice. In addition, the franchisee can opt out of the agreement within only 60 days if the hotels annual occupancy rate drops below 50 percent.

"Settle Inn was recently recognized by the American Association of Franchisees and Dealers (AAFD) for setting a new standard when it comes to franchise agreements. The AAFD rated Settle Inn's 39-page contract to be 99.3 percent compliant against their fair franchising conformity standards", Kline said. "That means no one else is as franchise friendly as we are," he said.

Settle Inn's leadership team has plenty of experience to take the company to the next level. Watters most recently was vice president of corporate development for Le Meriden Hotels and Resorts in London, England. Kline has been in the hotel industry for nearly 20 years working with Super 8 Motels and other Cendant brands. He was most recently working as a development consultant with Carlson Hotels Worldwide in Canada.

Duane Whorton is the latest experienced executive to join the Settle Inn team. Whorton, who is regional vice president of franchise development at Settle Inn, most recently was senior director of new construction development with the Cendant hotel corporation.

Watters said he feels confident Settle Inn's experienced team will help him meet a goal of having franchise agreements signed for 20 hotels by the end of 2006. Shaline said he is excited about working with the company and has options to build up to12 Settle Inns across Wisconsin. "We are thrilled to be a part of Settle Inn's exciting future", Shaline said.