Country Maid Financial

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International Guild of Hospitality & Restaurant Managers

Country Maid Financial Inc., incorporated in 1984, manages and maintains 18 motel properties located throughout the United States through its subsidiary, Territorial Inns Management Inc. (TIM). The Company operates in eight states: Florida ,

Georgia

, Illinois , Iowa , Kansas , Missouri , Texas and Washington . The Company plans to significantly expand its operations by obtaining additional motel operating leases throughout the

United States

and

Canada

and has undertaken a plan to lease a number of economy-scale motels from motel owners with options to purchase the motel at its current value. The Company is confident that these motel properties can be operated at a significant net profit.

The Company's portfolio currently consists of the management of 17 motel properties and one apartment complex. Additionally, the Company operates a motel in Iowa under a lease agreement with option to purchase, and the Company is negotiating to operate 10 Select Inns. Also, the Company is currently managing a motel in Lawrence , Kansas , with 60 economy-scale rooms with estimated gross revenues of $720,000 per year since March 1, 2000 , under an oral management agreement until the longer-term lease agreement can be finalized between the parties.

The Company plans to continue to obtain more motel operating leases with purchase options from motel owners throughout the

United States

and potentially

Canada

. The Company began a plan to lease economy scale motels whose per-room price ranges from $27 to $59 (except in extraordinary circumstances such as contract negotiated room rates or during unusually busy events or seasons), from motel owners for an annual lease payment of 7.2% of the annual gross revenue of the motel, with an option to purchase for the current value estimated at approximately 2.5 to three times the annual gross revenue (CEV) of the individual motel property.

Eleven of the 18 properties in the Company's portfolio are national motel franchises. Two belong to the Select Inns chain, and nine are Best Inns franchises. This arrangement has two primary advantages, name recognition and standardized quality. The combined impact of these advantages is to increase the occupancy rates of the properties under the Company's management, and to thereby increase the Company's overall profitability.

Effective July 1, 1999, the Company entered into a Lease Agreement with Option to Purchase the Southfork Motel located in Bloomfield , Iowa . The lease provides for monthly lease payments calculated at 20% of the gross revenue of the motel. The lease grants the Company an option to purchase the property at the price of $650,000 exercisable only during the last 60 days of the fourth five-year term of the lease.

On or about November 9, 1998 , the Company and Best Inns Inc. (Best Inns Kansas ), executed a Letter of Intent, which sets forth the terms for the Company to lease with an option to purchase nine Best Inns motel properties. The terms of the Letter of Intent provide that the Company will receive the gross revenue generated by the properties and pay to Best Inns a fixed annual lease payment of $1,980,000, payable monthly, and the Company has an option to purchase the properties for the total amount of $24,000,000. As consideration to Best Inns for the option to purchase, the Company agreed to issue securities of the Company with an aggregate value of $3,000,000.

On March 1, 1999 , the previous management company of the Best Inns properties voluntarily resigned from their duties and the Company assumed the operation of the nine Best Inns properties on a straight management basis of 5% of the gross revenue to the Company. The Company continues the management of the nine Best Inns based on the oral agreement effective March 1, 1999 .

The Company operates six other motel properties and an apartment complex under individual management agreements, which set the management fee at a fixed percentage, generally 5% of the gross revenue received from the property. The motel owners are obligated to pay all expenditures with limited authority to the Company to pay recoverable expenditures on the owners' behalf up to an amount of $5,000 per month.

Some of the more commonly known national management companies with which the Company competes, either directly or indirectly, include The Peninsula Group, Vista Host, Outrigger Hotels & Resorts, Hostmark Management Group, GF Management and Linchris Hotel Corp.

Disclaimer:
The data included within the Financial section is solely for information and does not construe a recommendation and/or endorsement by IGHRM or its members to invest funds with any of the companies listed. You are strongly advised to obtain professional advice with qualified individuals or corporations for any investments of funds.

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