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HOSPITALITY FRANCHISE SYSTEMS TO ACQUIRE SUPER 8 MOTELS; PURCHASE PRICE IS $125 MILLION IN CASH

 PARSIPPANY, N.J., Feb. 16 /PRNewswire/ -- Hospitality Franchise Systems, Inc. (NYSE: HFS) announced today that it had entered into a definitive agreement with the owners of Super 8 Motels, Inc. to purchase Super 8 for $125 million in cash.
 Super 8 is the franchisor of more than 1,000 motels in the United States and Canada. The chain comprises approximately 60,000 rooms located in 49 states and Canada. According to information provided to HFS by Super 8, in 1992 Super 8 recorded franchise revenues of approximately $34 million and earnings before interest, taxes, depreciation and amortization (EBITDA) of approximately $15.4 million.
 HFS also announced that it expects to finance the acquisition through borrowings from its existing bank group and in connection with that transaction is in discussion with its bank group to refinance its existing debt at a substantially lower interest cost.
 HFS Chairman and Chief Executive Officer Henry R. Silverman said, "Super 8 is the dominant national franchisor in the budget segment of the lodging industry. It represents an excellent price point extension for HFS. Super 8's average daily room rate is $37.00, about 15 percent below that of our Days Inn chain. It gives us instant penetration with critical mass in the budget segment, which is the fastest growing part of the market."
 John D. Snodgrass, HFS president and chief operating officer, added, "Super 8, known for its broad appeal, solid reputation, and high quality franchise base, is an excellent acquisition for HFS. This transaction will now make available to Super 8 franchisees HFS' operational, marketing and franchise sales experience. It will also add to the existing benefits of synergy between our other three brands.
 "Consistent with our philosophy of maintaining separate brand identity, Super 8 will continue to operate with its own personality as well as its own separate reservations system with an individual toll free number."
 Ronald J. Rivett, founder and chairman of Super 8, said, "My associates and I remain Super 8's largest franchisees, with interests in over 100 units. We agreed to sell the Super 8 Franchise System to HFS because we are confident that its unique brand management philosophy will further increase the value of our motels."
 Loren D. Steele, vice chairman and chief executive officer of Super 8, added, "HFS maintains separate brand identity for each of its franchise systems. Accordingly, for Super 8's customers, its franchisees, a combination of HFS's franchise support services and economies of scale represent a further strengthening of the Super 8 Franchise System."
 The transaction is subject to customary conditions, including the completion by HFS of satisfactory financing arrangements. The transaction is expected to be consummated by the middle of April.
 Following the acquisition, Mr. Snodgrass will become chairman of the board and chief executive officer of Super 8. During a transition period, Mr. Steele will continue as vice chairman of the board and Harvey Jewett will remain president and chief operating officer.
 Hospitality Franchise Systems, Inc., the world's largest franchisor of hotel rooms, is a publicly-held company whose stock is traded on the New York Stock Exchange under the symbol "HFS". The company has more than 2,500 Days Inn, Howard Johnson and Ramada franchised hotels with over 300,000 rooms in the United States, Canada, Mexico, India and Europe.
 Super 8 was founded in 1976 with the construction of the first property in Aberdeen, S.D.
 The Super 8 company itself owns 48 motels. Those properties or any other real estate will not be acquired in the transaction with HFS. Those properties will be reorganized in a new company which will continue to have its headquarters in Aberdeen.
 Mr. Snodgrass said HFS plans to maintain a substantial operation in Aberdeen and remain an active member of the local business community.
 -0- 2/16/93
 /CONTACT: A.B. Albritton of HFS, 201-952-8414/
 (HFS)


CO: Hospitality Franchise Systems, Inc.; Super 8 Motels, Inc. ST: New Jersey, South Dakota IN: LEI SU: TNM

GK-OS -- NY029 -- 6747 02/16/93 09:20 EST
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Date:Feb 16, 1993
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