2013 qlb update final

diversify your portfolio Opportunities in New Build, Conversion, and Hotel Membership

Open for Opportunity Choice Hotels International® is one of the world’s largest hospitality companies, with over 70 years’ experience and over 6,700 hotels open or under development worldwide. Hotel operators who franchise with Choice Hotels® benefit from affiliating with highly recognizable brands and a powerful reservations system that connects their properties with millions of guests. Based on our scale, experience, and strategic technologyfocus, Choice Hotels is well-positioned to help our franchisees navigate through today’s complex and ever-evolving lodging landscape.

Hoteliers who affiliate with Choice Hotels have access to a broad array of benefits and resources designed to optimize their operating efficiency and potential for a return on investment, including: • Expert, “hands-on” opening/ongoing support • Extensive library of online, self-paced training programs • Easy-to-use and cost-effective Property Management System (PMS) • Over $200M spent annually on marketing and promotional efforts • Choice Privileges® guest loyalty program, one of the fastest-growing rewards programs in the hotel industry, with over 17 million members.

Diverse Brands for Your Portfolio Choice Hotels offers lodging investors and developers many popular brands to consider for their next project.

Ranging from upscale to economy with new build and conversion options, all our brands are value-engineered to make your investment as cost-efficient as possible and optimize the amenities that matter most to guests.

New Build Upscale

Midscale

Extended Stay

Conversion Midscale

Membership

Economy

Strong Reservations & Distribution System Our Central Reservations System (CRS) is considered one of the largest in the industry, with rates, availability and hotel-specific data automatically updated to all distribution systems on a real-time basis through our property management system, choiceADVANTAGE®.

ChoiceHotels.com With an extensive investment in both paid and organic (free) search engine marketing, as well as a robust affiliate program, ChoiceHotels.com is designed to be the lowest-cost, highest-revenue-producing platform for franchisees. In 2012, the site received over 138 million visitors and is among the best in the industry at converting “lookers to bookers.”

Driving reservations to your hotel – In 2012, the company’s Central Reservations System booked over $2.8 billion system-wide in gross room revenue.*

800.4CHOICE Our contact centers are staffed with trained sales representatives who answer both a central system-wide Choice Hotels number, 800.4CHOICE, as well as brand-specific numbers. Located around the world, our contact centers are multilingual. The voice reservations network handled more than 6 million calls last year, with an enviable track record of high conversion. Franchisees can participate in Call Forwarding, an optional program that allows hotel staff to transfer local callers to our highly skilled sales reps, who effectively deliver high-quality reservation services.

Global Distribution Few can match the size and scale of the Choice Hotels distribution platform, encompassing all Choice Hotels reservations channels. Choice Hotels continues to drive more reservations through our central channels (ChoiceHotels.com and 800.4CHOICE), deliver premium ADRs, automate rates and inventory, drive qualified online traffic, and provide your hotel a competitive selling advantage.

By capitalizing on these platforms, Choice Hotels is continually working to provide consumers with the ability to book Choice Hotels brand properties through the channels that fit their lifestyle and booking preferences.

We prove this to franchisees by continuing to grow CRS Contribution.

Internet Distribution System We have an extensive online distribution network, reaching thousands of Internet travel websites.

Our relationships with leading third-party Internet travel websites like Booking.com, Expedia, hotels.com, Orbitz and Travelocity are among the most competitive in the industry, providing Choice Hotels-branded properties with a unique advantage and reduced costs. Our agreements also ensure our hotels receive priority positioning, and all reservations are automated through our Central Reservations System.

Mobile Applications and Technology As customers increasingly engage with hospitality brands on mobile platforms, Choice Hotels continually innovates to capitalize on this growth and deliver revenue to franchisees. A leader in hospitality, Choice Hotels launched the hotel industry’s first global iPhone app, which has since been downloaded more than 1 million times. Choice Hotels also offers a native app for Android and a mobile website with guest-friendly features like GPS-based search functionality, hotel photos and amenities, and a simple, intuitive booking process.

In 2012, as customers increasingly adopted tablet technology, Choice Hotels continued its investment, launching its first dedicated iPad app. In March 2013, mobile applications from Choice Hotels were recognized as the hotel industry leader for customer satisfaction. (ForeSee Mobile Satisfaction Index: Travel Edition – March 2013)

* Source: Figure reflects the revenues delivered through the Choice Hotels Central Reservations System (CRS) and other non-CRS marketing channels in 2012. The spend figure is based on accounting records of the System Fee in 2012 and has been compiled in a manner consistent with generally accepted accounting principles. See applicable Franchise Disclosure Document dated April 1, 2013.

Top-Notch Services & Support Opening Services Once your contract is executed to become a Choice Hotels brand property, the Opening Services Department will work with the hotel directly to bring your property online as quickly as possible. We ensure that your hotel meets brand standards and that it is plugged into all Choice Hotels resources. During the opening, a team of professionals that includes an Architect and Project Manager will review your plans to make certain the hotel is being built per brand standards. Opening Services Specialists will work to certify that all required documents are received, and Opening Services Consultants will visit your hotel and work with staff and management, educating them on the top-notch services, training and support Choice Hotels provides.

Brand Performance Consultants Our team of Brand Performance Consultants (BPCs) live and work in the regions they serve, monitoring performance and consulting with hotels within their respective portfolios. They provide assistance in achieving various performance metrics related to revenue, market share, guest satisfaction and brand standards compliance.

Property Management Systems choiceADVANTAGE is the center of a complete technology solution that helps hotels optimize revenues, increase reservation contributions and deliver outstanding service to guests. This property management system is fully integrated with our marketing, customer and reservations systems, allowing hotels to take full advantage of the power of the Choice Hotels distribution network.

An easy-to-use, intuitive interface means front desk staff get up to speed quickly, while integrated revenue management functionality helps them sell your hotel at higher rates. As one of the most widely distributed web-based property management systems in the industry, choiceADVANTAGE allows owners and general managers the flexibility to access their system from anywhere in the world.

It helps to reduce costly investments in technology and training required by other property management systems.

Associate Education and Training Programs Bottom line, your management and staff need to know how to effectively run your hotel, optimize bookings, ensure guest satisfaction and drive performance. We offer exceptional training programs at our corporate office as well as training in your market or at your hotel. Choice Hotels has been rated one of the top training organizations for its comprehensive franchisee training and development programs.** Our online training and educational resource center, ChoiceU.com, is designed specifically for owners, managers and employees. Available 24 hours/7 days a week, it features training modules on a wide array of topics, with an emphasis on acquiring the knowledge and developing skills to effectively run a top-performing property.

Procurement Services Helping Choice Hotels franchisees achieve efficiencies is the driving force behind the Procurement Services Department. This department’s mission is to simplify the purchasing process at the hotel level. We strive to ensure that Qualified Vendors supply Choice Hotels brand properties with products and services that meet stringent requirements for quality, reliability, performance and value.

** Source: 2012 Training Magazine’s Top 125 Companies. Training Magazine is the leading publication for learning and development professionals. Their Training Top 125 lists scores companies’ excellence in employer-sponsored training and development programs. www.trainingmag.com

Advertising & Marketing National Marketing Campaigns and Customer Communications Choice Hotels has a national, multi-brand campaign that includes image and national promotional advertising that drives consumers to our central reservations channel on ChoiceHotels.com. Multi-brand promotions, focused on our popular rewards program, Choice Privileges, are a key method to drive consumers to our website. They provide appealing incentives and create a sense of urgency among travelers to book direct with Choice Hotels, which in turn drives reservations designed to drive revenue per available room. Our high-profile multi-brand promotional activity is balanced with creative single-brand national campaigns that highlight the unique benefits and key travel occasions that each brand delivers.

We cover national marketing channels in the industry with a bold, coordinated effort. In 2012, over $208 million was spent system-wide on programs and promotions designed to increase brand awareness and drive hotel performance.***

We take a 360-degree approach to help connect with our travelers at all key touch-points within the decisionmaking process. On TV, to generate broad brand awareness, we run on a variety of national and cable networks.

Our online banners and videos are seen all over the Web through a mix of ad networks, media partnerships, and mobile and social channels. We also have regular campaigns using email and direct mail communications promoting Choice Hotels sent to members, guests and partners. Our search program ensures users find us – whether they are looking specifically for our properties or just a great place to stay – and we target our buys to desktop, mobile and tablet users so we reach our consumers across all media platforms.

Choice Privileges Rewards Program – The Performance Boost for Your Hotel Choice Privileges is one of the fastest growing rewards programs in the hotel industry, with over 17 million members. Our primary mission for Choice Privileges is to drive incremental reservations and create higher revenue contributions to your hotels. We strive to make our program more compelling to existing and potential members by adding new program features, new point-earning and redemption partnerships, benefits, and by continuing our global expansion.

Co-Op Advertising Many Choice Hotels properties have found that it’s both effective and cost-efficient to unite their efforts within a geographical region for local advertising. Our Co-op Marketing & Advertising Program helps franchisees pool their resources in order to create a bigger impact in local or regional media. A comparatively low per-hotel investment has the potential to yield significant impact for participating properties, and help generate new business during typically slow seasons. While participation is voluntary, many Choice Hotels properties include a co-op initiative as an integral element of their annual marketing plan.

Global Sales Team We have a dedicated Global Sales team solely focused on driving individual and group reservations for your hotels targeting business-to-business customers in the Corporate, Wholesale, Travel Agent, Diversity, Religious, Educational, Fraternal, Government, Military and Sports customer segments.

Our sales efforts include direct sales, telesales, sales blitzes and enhanced marketing efforts. We are proactive and strategic in our approach to earning and retaining business for your hotels from these important accounts.

We concentrate on corporations and organizations that we believe provide the highest potential revenue for your hotels.

Source: Figure is based on accounting records of the System Fee in 2012 and has been compiled in a manner consistent with generally acceptable accounting principles. See applicable Franchise Disclosure Document dated April 1, 2013.

***

Unless otherwise noted, all figures and statistics in this document are from the Franchise Disclosure Document, dated April 1, 2013, or from internal data of Choice Hotels International, Inc. This advertisement is not an offering. For New York: An offering can only be made by a prospectus filed first with the Department of Law in the State of New York.

Such filing does not constitute approval by the Department of Law. For Minnesota: Comfort Inn and Comfort Suites #F-3577; Quality Inn #F-48; Sleep Inn #F-1799; Clarion #F-1673; MainStay Suites #F-3269; Econo Lodge #F-3576; Rodeway Inn #F-2691; Cambria Suites #F-4986; Suburban Extended Stay Hotel #F-5274; Ascend Hotel Collection #F-5980. A copy of the Franchise Disclosure Document may be obtained through contacting Choice Hotels International at 1 Choice Hotels Circle, Suite 400, Rockville, MD, 20850, franchise_sales@choicehotels.com.

Choice Hotels International 1 Choice Hotels Circle, Suite 400 路 Rockville, MD 20850 franchise_sales@choicehotels.com ChoiceHotelsFranchise.com 漏 2013 Choice Hotels International, Inc. All rights reserved. 13-247/05/13