Under the Best Western Membership Agreement, what are the franchisee's obligations?

AL LETTER, BEST WESTERN'S BYLAWS, RULES AND REGULATIONS, AND ALL OTHER REGULATORY DOCUMENTS. ALL CAPITALIZED TERMS HEREIN NOT OTHERWISE DEFINED SHALL HAVE THE MEANING PROVIDED IN BEST WESTERN'S BYLAWS AND RULES AND REGULATIONS.

A. Membership Rights and Obligations

• 1. Best Western is a Membership organization, organized as a non-profit corporation pursuant to Arizona Revised Statutes § 10-3101, et seq., providing rights and obligations as set forth by the Membership in this Agreement, Best Western's Bylaws, Rules and Regulations, and all other Regulatory Documents (as that term is defined in Best Western's Bylaws). In connection only with the Property designated in this Agreement ("Property"), Best Western agrees to provide to Member all rights, and Member agrees to abide by all obligations, as may be established from time to time in Best Western's Regulatory Documents, all of which are accessible to Member or available upon request. This Agreement incorporates the rights and obligations of the Regulatory Documents, as amended from time to time.
• 1. Member agrees to timely pay all fees, dues, charges, and assessments imposed generally on the Membership by the Best Western Board of Directors ("Board") or the Membership, and the cost of all goods or services provided by or ordered through Best Western. Member agrees to allow Best Western to automatically debit Member's bank account each month in the amount owing Best Western. Member agrees to electronic monthly statements. Past due amounts shall bear interest at the rate of one and one half percent (1.5%) per month from the due date until paid, provided that such interest charge shall in no way authorize or excuse late payments or limit Best Western's rights and remedies against Member.
• 1. When grounds for cancellation or termination exist because of a Member default (as more fully set forth below), the Board may, in lieu of cancellation or termination, impose additional conditions to Membership. These may include, for example, higher quality assurance requirements, additional design requirements, or restriction of rights or services.

B. Term

• 1. The Effective Date of this Agreement is the date of execution; however, Membership rights shall not be granted until such time as the Property has been activated on Best Western's reservations systems and the Extended-Length Term of twenty (20) years (two hundred and forty (240) months) has begun.
• 1. The initial term of this Agreement, and any and all Membership rights, shall begin on the first day the Member's Property is activated on Best Western's reservations systems and will end on the last day of Best Western's fiscal year during which the last day of the two hundred and fortieth (240th) month falls ("Extended-Length Term"). Thereafter, this Agreement shall automatically renew for successive one hundred and twenty (120) month terms (each a "Renewal Term") unless either Best Western or the Member provides the other with written notice of its intent to not renew at least twelve (12) months prior to the end of the then-current Term. The Extended-Length

Term and Renewal Term(s) may be collectively referred to herein as the "Term."

1. If a Membership is transferred during the Term pursuant to Article II, Section 7 (B) or (C) of Best Western's Bylaws, the remainder of the Term will transfer with the transfer of the Membership.

C. Fees and Dues

All fees, dues, charges, and assessments shall be calculated, due, and owing as they apply to all other Best Western Members with the exception of Monthly Fees, which shall be equal to percent ( %) of the Property Room Revenue. Upon resignation, termination, or cancellation of Membership, the Member shall owe certain fees, dues, charges, assessments, and other damages to Best Western, as discussed in greater detail below in Section F.

D.

Source: Item 22 — Contracts (FDD pages 107–108)