Red Lion Hotels Sells the 149-room Red Lion Colonial Hotel in Helena, Montana to Helena Colonial L.L.C. for $5.6 Million; The Hotel will Maintain the Red Lion Brand / July 2012

SPOKANE, Wash., July 26, 2012-- Red Lion Hotels Corporation (NYSE: RLH) announced today it has entered into an agreement to sell the Red Lion Colonial Hotel in Helena, Mont., to Helena Colonial L.L.C. The purchase price for the sale is $5.6 million and the close date is scheduled for July 31, 2012. The buyer has indicated that it intends after closing to enter into a franchise license agreement with Red Lion Hotels Franchising Inc. and maintain the Red Lion brand on the hotel.

"The sale of our hotel property in Helena fits with our strategy of selling certain non-core assets to pay down debt, invest in our brand and increase shareholder value," said Jon E. Eliassen, President and Chief Executive Officer of Red Lion Hotels Corporation. "The buyer has informed us that it intends to invest substantial additional capital in the property, and we anticipate that the hotel's enhanced appeal will be attractive to our Red Lion guests in Helena."

The 149-room Red Lion Colonial Hotel has 15,500 square feet of meeting space, the largest group space in the market, and underwent a major renovation in 2006. It is located approximately one mile from the Montana State Capitol building. Helena Colonial L.L.C. is using Stockman Bank, based in Montana, to finance the acquisition.

Red Lion Hotels Corporation is a hospitality and leisure company primarily engaged in the ownership, operation and franchising of midscale hotels under its Red Lion® brand. As of March 31, 2012, the RLH hotel network was comprised of 48 hotels located in nine states and one Canadian province, with 9,010 rooms and 452,387 square feet of meeting space. The company also owns and operates an entertainment and event ticket distribution business. For more information, please visit the company's website at www.redlion.com.

See Also:	Red Lion Hotels Signs Franchise Agreement for Cathedral City, California Hotel; The 97-room Quality Inn & Suites Date Palm will Convert to Red Lion Hotel Cathedral City in Fall 2012 / July 2012
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	Red Lion Hotels Acquires Ten Previously Leased Hotels From iStar Financial for $37 million / November 2011
	Red Lion Hotels Continues Expansion in New Mexico with the Addition of the 126-room Red Lion Hotel Grants Formerly the Best Western Inn & Suites of Grants / October 2011
	Red Lion Hotels Names Julie Shiflett as Executive Vice President and Chief Financial Officer / September 2011
	Removing Interim Status, Red Lion Hotels Names Jon Eliassen President and Chief Executive Officer / February 2011
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	Red Lion Hotels Enters into Two New Franchise Agreement in Northern California / November 2010
	Red Lion Hotels Corporation Hires Dan Jackson as Senior Vice President and Chief Financial Officer / November 2010
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