AFM Hospitality To Acquire Marshall Management

TORONTO— AFM Hospitality Corp. has inked a non-binding letter of intent to acquire all the issued and outstanding shares of Marshall Management from Charles Marshall and other members of the Marshall family of Salisbury, MD. AFM will complete the transaction through a new U.S. subsidiary to be incorporated. The deal includes the management agreements of 22 hotels representing more than 3,000 rooms, located in Pennsylvania, New Jersey, Delaware, Maryland, Virginia, North Carolina, Florida, Kentucky and Louisiana operating under the Holiday Inn, Ramada, Hampton, Quality, Comfort, Sleep and Days Inn brands, plus numerous independent hotels. The acquisition would give AFM, via its subsidiaries Northwest Lodging International (USA) Inc., Northwest Lodging International (Canada) Inc. and Marshall Management, Inc., 71 hotels under management contract representing more than 7,000 rooms. “AFMs continued management services expansion throughout the current year has exceeded its plan to reach the 60-property benchmark by the end of 2002. The Marshall management agreements alone will increase our fees by more than $2.2 million per year and further extends AFMs presence in the American hospitality sector,” said Stephen Phillips, vice chairman/CEO of AFM. This agreement is tentatively scheduled to take effect October 31. Final terms and conditions are yet to be settled and the resulting deal will be subject to approval by AFMs audit committee and board of directors, as well as the Toronto Stock Exchange.