Hotel Union (HERE) Fair Franchising Web Site Addresses Proposed Hilton Hotels' Sale of Red Lion Hotels & Inns.

Business Editors

WASHINGTON--(BUSINESS WIRE)--Dec. 5, 2001

Today, the Hotel Employees and Restaurant Employees International Union (HEREIU) augmented its franchisee web site www.youownhilton.com to encourage exchange among Red Lion franchisees over the prospective sale of Red Lion from Hilton Hotels (NYSE:HLT) to WestCoast Hotels (NYSE:WEH).

Earlier this year, the Union launched a program to work with Hilton's franchisees, which included a survey of Hampton Inn owners and the launching of www.youownhilton.com, to provide information for and communicate with Hilton's many franchise owners. Today the Union added a Red Lion "Page" to the site.

Hilton and WestCoast entered into a non-binding letter of intent to sell 42 Red Lion properties and five Doubletrees in mid-October. The deal is expected to close before the end of this year. Hilton acquired Red Lion as part of its acquisition of Promus Hotels Corporation in late 1999.

"We have updated the site to facilitate communication among and between Red Lion franchisees in the event that they have common concerns during this proposed transition from Hilton to West Coast," said Richard Yeselson, HEREIU Senior Research Analyst.

"This proposed sale is an illustration of the power imbalance between franchisees and franchisors," Yeselson added. "When their properties opened this year, some Red Lion franchisees noted publicly how happy they were to have joined the Hilton family of brands. This apparently impending sale, therefore, may have come as a shock to them."

"The web site has become a way to share information about the proposed sale with Red Lion franchisees and other informed parties," said Yeselson.