(State or other jurisdiction of incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer Identification Number) |
(Address of principal executive offices) |
(Zip code) |
(State or other jurisdiction of incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer Identification Number) |
(Address of principal executive offices) |
(Zip code) |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4c)) |
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
Item 5.02 |
Departure of Directors or Certain Officers; Appointment of Certain Officers; Compensatory |
Item 7.01. |
Regulation FD Disclosure. |
(d) | Exhibits |
Exhibit 10.1 |
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Exhibit 10.2 |
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Exhibit 99.1 |
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Exhibit 104 |
Cover Page Interactive Data File (embedded within the Inline XBRL document). |
Exhibit 10.1 |
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Exhibit 10.2 |
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Exhibit 99.1 |
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Exhibit 104 |
Cover Page Interactive Data File (embedded within the Inline XBRL document). |
EXTENDED STAY AMERICA, INC. | ||||
Date: November 22, 2019 |
By: |
/s/ Christopher N. Dekle | ||
Name: |
Christopher N. Dekle | |||
Title: |
General Counsel | |||
ESH HOSPITALITY, INC. | ||||
Date: November 22, 2019 |
By: |
/s/ Christopher N. Dekle | ||
Name: |
Christopher N. Dekle | |||
Title: |
General Counsel |
Exhibit 10.1
Jonathan Halkyard
President and Chief Executive Officer
Extended Stay America, Inc. and ESH Hospitality, Inc.
11525 N. Community House Rd., Suite 100
Charlotte, NC 28277
Dear Jonathan:
Following up our previous discussion, this letter agreement confirms the terms of your continued employment during the transition period from your leadership to Bruce Haase (the CEO).
By counter-signing below, you hereby resign from your positions as President and Chief Executive Officer of Extended Stay America, Inc. (ESA) and ESH Hospitality, Inc. (ESH), your positions on the ESA and ESH boards of directors, and your officer positions in ESAs various subsidiaries. As of November 21, 2019, the following terms will become effective:
New Title: | Senior Advisor, reporting to the CEO. You will be an employee of ESA and not an independent contractor. | |
Advisory Term: | November 21, 2019 through February 25, 2020. Your separation date shall be February 25, 2020 (Separation Date). | |
Duties: | Assistance and advice as needed and requested by the CEO to support his transition into the roles as President and Chief Executive Officer of ESA and ESH. There is no minimum hour commitment on your part. | |
Place of Work: | You will work remotely. | |
Compensation: | The compensation for your employment during the Advisory Term will be continued vesting of your outstanding RSUs as described below. You will not be entitled to receive any other compensation for your employment during the Advisory Term, other than pursuant to applicable employee benefits plans, programs or policies, in accordance with their terms and conditions. | |
Benefits: | During the Advisory Term, you will continue to be eligible to participate in ESAs standard benefits program through your employment other than ESAs 401(k) plan. | |
Reimbursement: | ESA will continue to reimburse you in accordance with ESAs expense reimbursement policy for out-of-pocket expenses incurred by you during the Advisory Term performing services as requested by the CEO. | |
Performance RSUs: | Subject to your execution and non-revocation of this letter agreement and Exhibit A attached hereto, 3,978 RSUs will remain eligible to vest as of December 31st 2019 based on actual Adjusted EBITDA results for the 2019 calendar year and 12,056 RSUs will remain eligible to vest based on actual rTSR results for the applicable performance period, in each case, in accordance with your RSU award agreements and provided you are employed by ESA on each such vesting date. For the sake of clarity, any RSUs with respect to which the applicable performance period will not end prior to the Separation Date shall be forfeited immediately for no consideration. |
Time Based RSUs: | Subject to your execution and non-revocation of this letter agreement and Exhibit A attached hereto, 32,013 time-vesting RSUs that are scheduled to vest on February 7, 2020, 29,796 time-vesting RSUs that are scheduled to vest on February 23, 2020, and 3,410 time-vesting RSUs that are scheduled to vest on February 21, 2020, in each case, will vest as scheduled provided you are employed by ESA on each such vesting date. | |
Additional RSU Terms: | You will be entitled to receive distributions (or distribution equivalents) with respect to the above-referenced RSUs pursuant to the terms and conditions of the applicable award agreement. If your employment is terminated by ESA without Cause (as defined in the Severance Plan) prior to the applicable vesting date, you will vest in the above-referenced RSUs on your employment termination date (or as of December 31, 2019, if later). | |
Severance: | You acknowledge that you are a participant under ESAs Executive Severance Plan (Severance Plan). In accordance with Section 4 of the Severance Plan, subject to (i) your execution and non-revocation of this letter agreement and the general release in Exhibit A, (ii) your continued compliance with the restrictive covenants in Section 6 of the Severance Plan, and (iii) your continued employment through January 17, 2020 (unless your employment is terminated by ESA without Cause (as defined in the Severance Plan) prior to such date), you shall be entitled to the following (the benefits provided for in subsections (a), (b) and (c) referred to herein as the Severance Benefits):
(a) a cash payment in the amount of $2,781,000 equal to the sum of (i) one and one-half (1.5x) times your Annual Base Salary (as defined in the Severance Plan) as of November 21, 2019 and (i) one and one-half (1.5x) times your Target Bonus (as defined in the Severance Plan) as of November 21, 2019, payable in a single lump sum on January 17, 2020;
(b) subject to your timely election of healthcare continuation under COBRA, reimbursement for COBRA premiums for the one year period following your employment termination date or until you cease COBRA coverage, to the extent such premiums exceed the amount that you would have paid as an active employee during such period; provided, that, ESA reserves the right to modify this benefit to the extent it is not permitted to be provided by law or not permitted to be provided without penalty to ESA; and |
(c) payment for executive outplacement services provided by a firm to be determined by ESA in its sole discretion for a period of six (6) months following your employment termination date. |
Restrictive Covenants: | You will be subject to, and required to comply with, the covenants and other provisions contained in Section 6 of the Severance Plan. | |
Code Section 409A: | You and ESA acknowledge and agree that as of November 21, 2019 you will commence transition services as an employee of ESA at a rate that is less than 20% of the average level of bona fide services provided by you to ESA over the 36-month period immediately preceding such date. Consequently, it is intended that as of November 21, 2019 you shall incur a separation from service with ESA within the meaning of Section 409A of the Internal Revenue Code and the regulations promulgated thereunder (including for purposes of ESAs Deferred Compensation Plan). | |
Withholding: | ESA shall be entitled to deduct or withhold, or may require you to remit to ESA, at least the minimum statutory amount to satisfy federal, state or local taxes required by law or regulation to be withheld with respect to any benefit provided hereunder. | |
Release: | In consideration of the payments and benefits that you shall receive under this letter agreement and the Severance Plan, and in consideration of the mutual consideration contained in this letter agreement, the Severance Plan and acknowledged by you in the participation agreement to the Severance Plan, you shall execute a release of claims attached hereto as Exhibit A following your receipt of this letter agreement.
You shall reaffirm the release set forth in this section by executing a reaffirmation in the form attached hereto as Exhibit B (the Reaffirmation) on the day after the Separation Date. You further acknowledge that if you sign the Reaffirmation on the day after the Separation Date, it will be voluntary without any duress or compulsion by ESA. If you do not execute the Reaffirmation, all RSUs that become vested pursuant to this letter agreement shall be immediately forfeited for no consideration and be of no further force and effect, but the remainder of this letter agreement shall continue in full force. The date that the Reaffirmation becomes effective herein is referred to as the Final Release Effective Date. |
Jonathan, please sign below to reflect your agreement to the terms outlined in this memorandum and return to my attention.
/s/ Jonathan Halkyard | ||
Jonathan Halkyard | ||
Date: November 21, 2019 | ||
/s/ Christopher Dekle | ||
Christopher Dekle | ||
General Counsel and Corporate Secretary | ||
Extended Stay America, Inc. | ||
Date: November 21, 2019 | ||
/s/ Christopher Dekle | ||
Christopher Dekle | ||
General Counsel and Corporate Secretary | ||
ESH Hospitality, Inc. | ||
Date: November 21, 2019 |
Exhibit A
General Release
Jonathan Halkyard (Participant) and Extended Stay America, Inc. (the Company), for and in consideration of the payments and benefits that Participant shall receive under the Extended Stay America, Inc. Executive Severance Plan (the Plan), and in consideration of the mutual consideration contained in the Plan and acknowledged by the Participant in the Participation Agreement to the Plan, Participant and the Company hereby execute the following General Release (Release) and agree as follows (capitalized terms not defined below shall have the meaning set forth in the Plan):
1. Participant, on behalf of Participant, Participants agents, assignees, attorneys, successors, assigns, heirs and executors, to, and Participant does hereby fully and completely forever release each of the Company and those parties for which Participant has provided services in connection with his or her employment by the Company, including without limitation, their respective Affiliates, predecessors and successors and all of their respective past and/or present officers, directors, partners, members, managing members, managers, executives, agents, representatives, administrators, attorneys, insurers and fiduciaries in their individual and/or representative capacities (hereinafter collectively referred to as the Released Parties), from any and all causes of action, suits, agreements, promises, damages, disputes, controversies, contentions, differences, judgments, claims, debts, dues, sums of money, accounts, reckonings, bonds, bills, specialties, covenants, contracts, variances, trespasses, extents, executions and demands of any kind whatsoever, which Participant or Participants heirs, executors, administrators, successors and assigns ever had, now have or may have against the Released Parties or any of them, in law, admiralty or equity, whether known or unknown to Participant, for, upon, or by reason of, any matter, action, omission, course or thing whatsoever occurring up to the date this Release is signed by Participant, including, without limitation, in connection with or in relationship to Participants employment or other service relationship with the Company or its respective Affiliates, the termination of any such employment or service relationship and any applicable employment, compensatory or equity arrangement with the Company or its respective Affiliates (such released claims are collectively referred to herein as the Released Claims).
2. The Released Claims include, without limitation, (i) any and all claims under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act of 1967, the Civil Rights Act of 1971, the Civil Rights Act of 1991, the Fair Labor Standards Act, the Employee Retirement Income Security Act of 1974, the Americans with Disabilities Act, the Family and Medical Leave Act of 1993, and any and all other federal, state or local laws, statutes, rules and regulations pertaining to employment or otherwise, and (ii) any claims for wrongful discharge, breach of contract, fraud, misrepresentation or any compensation claims, or any other claims under any statute, rule, regulation or under the common law, including compensatory damages, punitive damages, attorneys fees, costs, expenses and all claims for any other type of damage or relief. The Released Claims shall not include any claims (i) to entitlements under the Plan, (ii) for indemnification, advancement of expenses and other right to benefit from the exculpatory provisions pursuant under the organizational documents of the Company or any indemnification agreement with Participant, (iii) any right to accrued salary or vacation, or entitlements under any employee benefit plan maintained by the Company, (iv) with respect to Participants rights in his capacity as an equity holder of the Company and its Affiliates, and to payments or benefits under any equity award agreement between the undersigned and the Company, (v) for workers compensation or unemployment benefits, (vi) to bring to the attention of the Equal Employment Opportunity claims of discrimination, harassment or retaliation; provided, however, that Participant does release Participants right to secure damages for any alleged discriminatory, harassing or retaliatory treatment or (vii) to assert any other rights that may not be waived by an employee under applicable law.
3. This means that, by signing this Release, Participant shall have waived any right which Participant may have had to bring a lawsuit or make any claim against the Released Parties based on the Released Claims. If any government agency brings any claim or conducts any investigation against the Company, nothing in this Release forbids Participant from cooperating in such proceedings, but by this Release, Participant waives and agrees to relinquish any damages or other individual relief that may be awarded as a result of any such proceedings.
4. Participant agrees to make himself or herself reasonably available to the Company in connection with any claims, disputes, investigations, regulatory examinations or actions, lawsuits or administrative proceedings relating to matters in which Participant was involved during the period in which Participant was an officer of the Company, and to provide information to the Company, and otherwise cooperate with the Company in the investigation, defense or prosecution of such actions.
5. Participant represents that he or she has read carefully and fully understands the terms of this Release, and that Participant has been advised to consult with an attorney and has had the opportunity to consult with an attorney prior to signing this Release. Participant acknowledges that he is executing this Release voluntarily and knowingly and that he has not relied on any representations, promises or agreements of any kind made to Participant in connection with Participants decision to accept the terms of this Release, other than those set forth in this Release.
6. Participant acknowledges that Participant has been given at least twenty-one (21) days to consider whether Participant wants to sign this Release and that the Age Discrimination in Employment Act gives Participant the right to revoke this Release within seven (7) days after it is signed, and Participant understands that Participant will not receive any payments due him or her under the Plan until such seven (7) day revocation period (the Revocation Period) has passed and then, only if Participant has not revoked this Release. Upon such revocation, this Release and the provisions entitling him or her to future benefits under the Plan shall be null and void and of no further force and effect. To the extent Participant has executed this Release within less than twenty-one (21) days after its delivery to Participant, Participant hereby acknowledges that his or her decision to execute this Release prior to the expiration of such twenty-one (21) day period was entirely voluntary.
/s/ Jonathan Halkyard |
Participant |
November 21, 2019 |
Date |
Exhibit B
Reaffirmation
Reference is hereby made to the letter agreement (Agreement), between the undersigned, Extended Stay America, Inc. (ESA), and ESH Hospitality, Inc. (ESH, together with ESA, the Company), dated as of November 21, 2019, which Agreement contemplates the execution by the undersigned of this Reaffirmation (this Reaffirmation). It is acknowledged and agreed that this Reaffirmation will be part of and subject to the terms of the Agreement, and capitalized terms in this Reaffirmation will be as defined in the Agreement unless otherwise defined herein.
The undersigned hereby states, affirms, and agrees as follows:
A. The release of claims in the Agreement is hereby reaffirmed in full as if fully set forth herein and executed as of the date hereof.
B. The execution of this Reaffirmation is without any admission of liability by the Company.
C. The undersigned has considered and understands the terms of this Reaffirmation, the consideration he will receive if he enters into this Reaffirmation and does not revoke it, and what rights and benefits he is giving up, up to and including the date he signs, including his rights under the ADEA. The undersigned has hereby been advised to consult an attorney about the contents and meaning of this Reaffirmation, and has had the opportunity to do so to his satisfaction. The undersigned acknowledges and agrees that he knowingly and voluntarily has entered into this Reaffirmation agreement with complete understanding of all relevant facts, and that he was neither fraudulently induced nor coerced to enter into this Reaffirmation.
Name: |
Jonathan Halkyard | |
Date: |
Exhibit 10.2
Bruce Haase
Dear Bruce:
We are pleased to offer you employment with Extended Stay of America, Inc. (ESA) and on the following terms:
Position: | President and Chief Executive Officer of ESA. You will also be the President and Chief Executive Officer of ESH Hospitality, Inc. (ESH). On the Effective Date, you will be appointed to the Board of Directors of ESA. | |
Effective Date: | November 22, 2019. | |
Reporting to: | The Boards of Directors of ESA and ESH (the Boards). | |
Base Compensation: | For the period commencing on the Effective Date and ending on December 31, 2021, cash compensation at the rate of $100,000 per annum to be paid in accordance with ESAs normal payroll practices.
As of December 2, 2019, you will be granted restricted stock units (RSUs) in respect of 175,000 Paired Shares (as defined in the LTIP) under the terms of the Amended and Restated ESA Long-Term Incentive Plan (the LTIP). The RSUs will vest in respect of 7,000 Paired Shares on the last day of each calendar month beginning on December 2, 2019 and ending on December 31, 2021, subject to your continued service on each vesting date. Each of the RSUs that have become vested shall be settled in Paired Shares, in each case, on the earlier of (x) your termination of employment for any reason, (y) a Change in Control (as such term is defined in the LTIP), but only if such Change in Control constitutes a change in the ownership or effective control of or a change in the ownership of a substantial portion of the assets of of the Company within the meaning of Section 409A of the Internal Revenue Code (the Code) which shall be interpreted in a consistent manner in accordance with the definition of a change in control under Code Section 409A, or (z) the 15th day of March in calendar year 2022.
If your employment is terminated by ESA without Cause (as defined in the LTIP) before the last day of a calendar month, then the 7,000 RSUs applicable to that given month will vest on a pro rata basis through your termination date.
You and the Boards shall discuss the form and amount of your base compensation for periods following December 31, 2021. |
Annual Bonus Eligibility: | You will not be eligible for ESAs annual bonus plan in respect of any period prior to December 31, 2021. | |
Sign-On Equity Grant: | As soon as reasonably practicable after the Effective Date, pursuant to the LTIP, you will be granted time-vesting RSUs in respect of 100,000 Paired Shares, which shall vest pro-rata on each of the first three anniversaries of the Effective Date, subject to your continued service on each vesting date. In the first quarter of 2020, you will be granted performance-vesting RSUs in respect of 100,000 Paired Shares, which will vest on the basis of the same performance metrics applicable to the awards granted to the other senior executives of ESA at the same time.
If, within 24 months following a Change in Control, your employment is terminated by ESA without Cause (as defined in the LTIP) or by you for Good Reason (as defined in the Severance Plan and amended herein), then the RSUs will become fully vested (with the performance RSUs vesting at the target level of performance). | |
Annual Equity Grants: | Commencing in 2021, you will be eligible for equity grants pursuant to the LTIP in amount determined by the Boards or the Compensation Committees thereof and shall be granted in such form as is consistent with those applicable to the equity awards granted to the other senior executives of ESA. | |
Treatment of Prior Equity Awards and Director Quarterly Fees: | Any equity awards that were previously granted to you will continue to vest in accordance with its terms. Any quarterly fees that you are owed for services as a director of ESH prior to the Effective Date shall be paid in cash on a pro-rated basis based on the date on which your employment commences. | |
Benefits/Vacation: | You will be eligible to participate in ESAs benefit plan(s) and ESA will provide you with an opportunity to obtain life insurance as mutually agreed. You will be eligible for vacation in accordance with ESAs policy. | |
Severance: | You will become a participant in ESAs Executive Severance Plan (the Severance Plan) and by execution of this offer letter, this offer letter shall constitute your Participation Agreement (as defined in the Severance Plan) effective as of the Effective Date by which you agree to be bound by and subject to all of the terms and conditions of the Severance Plan; provided, however, that the cash severance benefit you will be entitled to if you experience a Qualifying Termination (as defined in the Severance Plan), on or before December 31, 2021, will be $2,700,000 through December 31, 2021 and thereafter as mutually agreed to with the Boards, subject to your execution and non-revocation of a Release Agreement (as defined in the Severance Plan). If you experience a Qualifying Termination after December 31, 2021, your severance amount will be 150% of your base compensation as agreed between you and the Boards and if there is no agreement on your base compensation, the amount shall be no less than $2,700,000. |
Under the definition of Good Reason under the Severance Plan, for the period commencing after December 31, 2021, a material diminution in Participants base salary will be replaced with a material diminution in the total value of Participants annual Base Compensation (i.e., 7,000 x 12 x ESAs closing share price on December 2, 2019 plus $100,000), unless the parties mutually agree in writing otherwise.
Upon a termination of your employment with ESA, at the request of the Boards, you will resign as a director of ESA and ESH. | ||
Restrictive Covenants: | You will be subject to the covenants and other provisions contained in Section 6 of ESAs Executive Severance Plan. | |
Survival of ESH Director Agreements: | Your rights under any agreements entered into relating to your services as a director of ESH shall survive the execution of this offer letter and remain in full force and effect. | |
Dispute Resolution/Governing Law: | This offer letter shall be governed by the laws of Delaware. Any dispute, controversy or claim between that arises out of or relates to this offer letter, your employment with ESA, or any termination of such employment, shall be determined by final, binding, and confidential arbitration held and conducted by JAMS, Inc. (JAMS), under its then-applicable JAMS Employment Arbitration Rules and Procedures. The arbitrators fees and any filing and administrative fees and costs owed will be divided equally between you and ESA. | |
Section 280G Cutback: | To the extent that you would otherwise be eligible to receive a payment or benefit pursuant to the terms of this offer letter or any equity compensation or other agreement with ESA or any subsidiary or otherwise in connection with, or arising out of, your employment with ESA or a change in ownership or effective control of ESA or of a substantial portion of its assets (any such payment or benefit, a Parachute Payment), that is determined would be subject to excise tax imposed by Code Section 4999 (the Excise Tax), then ESA shall pay you whichever of the following two alternative forms of payment would result in your receipt, on an after-tax basis, of the greater amount of the Parachute Payment notwithstanding that all or some portion of the Parachute Payment may be subject to the Excise Tax: (1) payment in full of the entire amount of the Parachute Payment (a Full Payment), or (2) payment of only a part of the Parachute Payment so that you receive the largest payment possible without the imposition of the Excise Tax (a Reduced Payment). The parties agree that you are not entitled to any tax gross ups under any circumstances in relation to any Parachute Payments under Code Section 280G. |
Treatment under Code Section 409A: | The intent of the parties is that payments and benefits under this offer letter comply with or are exempt from Code Section 409A and the regulations and guidance promulgated thereunder and, accordingly, to the maximum extent permitted, this offer letter shall be interpreted to be exempt from Section 409A or in compliance therewith, as applicable. |
By signing below in accepting this offer set forth in this offer letter, you represent, warrant and agree that (i) you are not subject to any contract, arrangement, policy or understanding, or to any statute, governmental rule or regulation, that in any way limits your ability to enter into and fully perform the your obligations under this offer letter, (ii) you are not otherwise unable to enter into and fully perform your obligations under this offer letter, (iii) you are not in default under, or in breach of, any agreement requiring you to preserve the confidentiality of any information, client lists, trade secrets or other confidential information or agreements not to compete or interfere with any prior employer including, but not limited to, any employment agreement, and (iv) neither the execution and delivery of this offer letter nor the performance by you of your obligations hereunder will conflict with, result in a breach of, or constitute a default under, any confidentiality or non-competition agreement or any employment agreement to which you are a party or to which you may be subject and during your employment with ESA you will preserve the confidentiality of all information with respect to which you have an obligation of confidentiality to any other person. In the event of a breach of any representation or covenant in this paragraph, ESA may terminate this offer letter and your employment with ESA without any liability to you and you shall indemnify ESA for any liability it may incur as a result of any such breach.
Your employment with ESA will be at will meaning that it can be terminated with or without cause, and with or without notice, at any time, at the option of either ESA or you, except as otherwise prohibited by law. The terms of this offer letter, therefore, do not and are not intended to create either an expressed and/or implied contract of employment with ESA.
If the terms set forth in this offer letter are acceptable to you, please sign below where indicated and return an executed version to me.
Please feel free to contact me if you have any questions.
Sincerely,
/s/ Christopher Dekle |
Christopher Dekle |
General Counsel and Corporate Secretary |
Agreed and Accepted this 21 day of November, 2019
/s/ Bruce Haase
Bruce Haase
Exhibit 99.1
Extended Stay America Appoints Bruce Haase as Chief Executive Officer
Kelly Poling Named EVP, Chief Commercial Officer
Randy Fox Named EVP, Property Operations
CHARLOTTE, NC, November 22, 2019 (GLOBENEWSWIRE) Extended Stay America, Inc. and its paired-share REIT, ESH Hospitality, Inc. (together, the Company) (NASDAQ:STAY), the largest mid-priced extended stay hotel brand, today announced the appointment of Bruce Haase as President and Chief Executive Officer, effective immediately. Haase has been elected to serve as a director of Extended Stay America, Inc. and will continue to serve as a director of ESH Hospitality, Inc. He succeeds Jonathan Halkyard, who will continue to advise the Company through February 25, 2020.
Haase has served as a director of ESH Hospitality since 2018. He has more than 20 years of lodging experience with particular expertise in the extended stay hotel segment. From 2014 to 2016, he served as Chief Executive Officer of WoodSpring Hotels, LLC, the nations largest and fastest growing economy extended stay hotel brand. Previously, Haase served in a series of executive positions with Choice Hotels International from 2000 through 2012, most recently as Executive Vice President, Global Brands, Marketing & Operations.
The Company also announced today the appointment of Kelly Poling as Executive Vice President, Chief Commercial Officer, and Randy Fox, as Executive Vice President, Property Operations, filling two previously vacant key leadership positions and further strengthening the management team with executives deeply experienced in the extended stay hotel segment. Poling has a track record of success in the extended stay hotel segment, having led all central revenue generating functions at WoodSpring Suites. With 35 years of property operations experience, Fox has unique experience in successfully managing and improving property performance of extended stay lodging assets nationwide.
Douglas Geoga, Chairman of the Companys Boards, said, We are pleased to welcome Bruce, Kelly and Randy to the leadership team of Extended Stay America. The Company is well positioned to capitalize on its unique business model by leveraging the teams deep experience in all facets of extended stay hotel operations, branding, marketing, revenue generation and franchising. With Bruces knowledge of the Company and his experience working with two proven industry operators in Kelly and Randy, along with the rest of Extended Stays leadership, I am confident that this team will hit the ground running.
Geoga continued, Over the past several years the Extended Stay Boards, together with our outside advisors, have carefully considered a wide range of transactional strategic alternatives to drive shareholder value. Through this process, which was only recently discontinued, the Boards determined that none of the terms upon which alternatives were available would provide an acceptable outcome, or superior value compared to improved execution of the Companys business strategy. While the Boards remain open to considering opportunities to enhance shareholder value, we are confident in the new management teams ability to unlock the full potential of the Extended Stay America brand, assets and business capabilities. We believe that a focus on property-level improvement, franchise acceleration and asset management, together with the Companys industry-leading margins and free cash flow generation, will lead to enhanced strategic and structural alternatives in the future to drive superior returns for all shareholders.
Haase said, I am excited to partner with our management team and 8,000 associates. As the only company in the lodging industry solely focused on the unique needs of the extended stay guest, we are solidly positioned to unlock the full potential of the Company within this attractive segment. Given my history and past success in working with Kelly and Randy to drive improved performance, I am confident in the future of the Company and have asked the Boards to ensure that my compensation is fully aligned with the interests of our shareholders.
Geoga added, On behalf of the Boards, I thank Jonathan for his many contributions as CEO and in his prior management roles with our company. We appreciate his continued support during this leadership transition.
About Bruce Haase
Haase has served as a director of ESH Hospitality since 2018 and is the Chairman of the Board and Majority Shareholder of HomeWell Care Services. From 2014 to 2016, he served as Chief Executive Officer of WoodSpring Hotels, LLC. Previously, Haase served in executive positions at Choice Hotels International, including: Executive Vice President, Global Brands, Marketing & Operations (2008 to 2012); Senior Vice President, Domestic Brand Operations & International Division (2007); Senior Vice President, International Division (2000 to 2007); and Vice President, Finance & Treasurer (2000). Prior to joining Choice, he worked at The Ryland Group, Inc., Caterair International Corporation, Marriott Corporation, and Goldman, Sachs & Co. Haase has a bachelor of science in engineering from Virginia Tech, a masters in electrical engineering from The Johns Hopkins University and an MBA in finance from The Wharton School of the University of Pennsylvania.
About Kelly Poling
Poling was most recently Chief Executive Officer of Premier Worldwide Marketing, the exclusive worldwide representative for Karisma Hotels & Resorts, and previously served as Executive Vice President, Marketing and Consumer Revenue from 2017 to 2019. From 2014 to 2017, Poling served as Executive Vice President and Chief Marketing Officer for WoodSpring Hotels, and earlier in her career, spent seven years at Choice Hotels International, leading the corporate strategy, marketing and e-commerce teams. Poling has a bachelors degree in business administration from The George Washington University and an MBA from The Wharton School of the University of Pennsylvania.
About Randy Fox
Fox has more than 35 years of hotel business experience, including most recently as Chief Operating Officer of InTown Suites and Uptown Suites, an extended stay brand with approximately 200 locations across more than 20 states. He served as Executive Vice President of Operations for WoodSpring Hotels from 2012 to 2016. He earlier spent more than 12 years at Red Roof Inn, including as Senior Vice President of Operations from 2007 to 2012 and Regional Vice President of Operations from 1999 to 2007. He has a bachelor of science in business administration from Franklin University.
About Extended Stay America
Extended Stay America, Inc. and its brand Extended Stay America® is the leading brand in the mid-priced extended stay segment in the U.S with 628 hotels. Extended Stay Americas subsidiary, ESH Hospitality, Inc. (ESH), is the largest lodging REIT in North America by unit and room count, with 555 hotels and more than 61,500 rooms in the U.S. Extended Stay America also manages or franchises an additional 73 Extended Stay America® hotels. Visit www.esa.com for more information.
CONTACTS:
Investors or media:
Rob Ballew
(980) 345-1546
investorrelations@esa.com
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