Except as specified in this
Item 10, we do not offer or provide any financing arrangements for Microtel
licensees, either directly or indirectly.
As we disclosed in Item 5, at
our sole discretion and subject to your creditworthiness, we may permit you to pay
the Application Fee over a period of time instead of in a lump sum at the time
the License Agreement1094AppJication1095 is
stgfled1096suhmitted1Q97. We have no established
program with definitive criteria or guidelines for determining whether we will
offer this option to you and, if we did, how long you would have to pay the
Application Fee and what interest rate would be applied to the amount owed.
Participation in this option, if offered to you, is strictly voluntary. If you
are offered this ojrtion^and you acc^> ^ou must
S*�P a promissory note in tho
form attacliod to this offering ciroular nt I Exhibit H �j .If you default in paying the
promissory note, you will be in breach of your License Agreement which may
result in the termination of your''License Agreement. Interest accrues if the
note is not paid when due and the note provides for a waiver of presentment,
demand for payment, notice of dishonor and protest. The note contains no
pre-payment penalty. Personal guarantees by your principals are typically
required.
Under certain circumstances
we may, in our sole discretion,1102 provide financial
assistance to selected licensees to help them develop Hotel properties.. This
financial assistance, which are not loans, usually takes the form of a subsidy
of an amount equal to or less than the licensee''s Application Fee. The licensee
is only obligated to repay the subsidy, or a portion, if the License Agreement
is terminated for any reason prior to a designated time, usually five or seven
years after the opening of the Hotel. The principals of the licensee must
personally guaranty repayment of this subsidy, but only if the licensee is
required to repay the subsidy. If this financial assistance is provided, a
provision will be added to the License Agreement to reflect these terms.
Financial assistance of this type will be offered, if at all, on an extremely
limited basis. We maintain the right to determine, in our sole discretion, to
whom these subsidies are offered, the amount of the subsidy and the number of years
the licensee is required to stay in the Hotel System or risk having to repay
the subsidy.
Wodonet''"JEteiih�r_ we nor our affiliates1104
guarantee your notes; leases or other obligations. Our franchisees may be
eligible for SBA loan processing.
