What pricing restrictions are placed on Delta Hotels By Marriott franchisees?

You are responsible for setting your own prices and rates for the goods and services offered by your hotel, except that we: (i) prohibit price-gouging at the hotel; (ii) require you to participate in our associate rate discount program; (iii) may require you to provide discounted rates to members of our loyalty programs; (iv) prohibit you from charging for certain goods or services that we require be provided on a complimentary basis; (v) prohibit complimentary or reduced price guestrooms or food and beverage to benefit any other business at or outside of the hotel; and (vi) prohibit certain types of surcharges, destination fees, resort fees, and other similar fees, unless we determine that the fees are appropriate based on, among other factors, the location of the hotel, the services offered by the hotel, and consumer sentiment regarding the assessment of such fees. You may also be prohibited from charging certain fees by applicable law or by consent orders entered into by us on behalf of system hotels. In addition, as discussed below, you must distribute your inventory in a manner consistent with our designated best rate guarantee policy. We may, from time to time, recommend or suggest prices or rates for the products and services you offer, including in circumstances involving your participation in various sales or revenue management programs, account

management programs, and/or other consulting services or promotions offered by us and our affiliates. Our recommendations or suggestions concerning prices or rates are not mandatory, and you are ultimately responsible for determining the prices or rates at which you offer your goods and services. If you participate in such programs and promotions you must honor any price to which you commit. If we provide inventory management or sales services to you, you will consign hotel inventory to us, we will act as your sales agent, and you will retain all risk of loss for unsold or cheaply sold inventory. Nothing contained in the franchise agreement, or any other agreements required for participation in any programs or services should be considered a representation or warranty by us that the use of such suggested or recommended prices or rates, or inventory management or sales services will produce, increase, or optimize your profits.

You must comply with our policies regarding publishing rates and transmitting rates to us and other reservation channels. You must comply with our designated best rate guarantee policy. This policy provides that a hotel's published room rates across all reservation channels should not be lower than its published rates on Marriott.com, the Marriott Bonvoy Application, Marriott Worldwide Reservations, Property Direct, and any other reservation channels owned or operated by Marriott or its affiliates (these channels and any other channels that Marriott designates are collectively referred to as "Marriott Direct Channels"). Our designated best rate guarantee policy also provides that, if a customer books a Company Brand Hotel room through a Marriott Direct Channel and then finds a lower publicly available rate within 24 hours for the same hotel, room type, and dates on any non-Marriott Direct Channel, or with a travel agency or travel management company, the hotel will match the lower rate and will either provide an additional 25% off the room rate or issue loyalty program points to the customer, consistent with our thencurrent policies. We monitor hotel compliance with this policy and will assess a non-compliance charge in each instance where the hotel's published room rate violates this policy. You must also reimburse us for all costs, including audit costs and excess property reimbursements, we incur in connection with your noncompliance. This policy is described in the standards and is subject to specific terms and conditions, which we may change in our sole discretion.

We currently have distribution agreements and relationships with distribution channels including Expedia, Priceline.com, Booking.com, Travel Ease, travel management companies, and tour operators, among other channels. Access to your hotel's inventory by these distribution channels may be facilitated through a direct or third-party managed interface with our designated reservation system. In certain circumstances, some of our contracts with distribution channels provide for access to hotel inventory through other means, such as by extranet. Certain of these arrangements are mandatory, and franchisees must participate on the terms set forth in our distribution agreements. If participation in a distribution arrangement is optional, you may elect to participate on the terms set forth in our distribution agreement or may negotiate your own agreement with the distribution channel so long as the agreement is consistent with our designated best rate guarantee policy and other applicable standards (which include criteria for approval of distribution channels). If you elect to negotiate your own agreement with a distribution channel, we will be under no obligation to support your business relationship with that distribution channel, including by making available the use of our programs and systems such as our designated reservation system, our designated property management system, and CTAC in connection with the use of that channel. We prohibit franchisees from using certain third-party distribution channels and limit the inventory of guestroom nights franchisees may make available to customers through each distribution channel.

Source: Item 16 — RESTRICTIONS ON WHAT THE FRANCHISEE MAY SELL (FDD pages 111–120)