EXTENDED STAY AMERICA, INC. (Exact name of registrant as specified in its charter) ESH HOSPITALITY, INC.

Transcription

1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (date of earliest event reported) April 26, 2018 EXTENDED STAY AMERICA, INC. (Exact name of registrant as specified in its charter) Delaware (State or other jurisdiction of (Commission (I.R.S. Employer incorporation or organization) File Number) Identification Number) N. Community House Road, Suite 100 Charlotte, North Carolina (Address of principal executive offices) (Zip code) Registrant s telephone number, including area code (980) ESH HOSPITALITY, INC. (Exact name of registrant as specified in its charter) Delaware (State or other jurisdiction of (Commission (I.R.S. Employer incorporation or organization) File Number) Identification Number) N. Community House Road, Suite 100 Charlotte, North Carolina (Address of principal executive offices) (Zip code) Registrant s telephone number, including area code (980) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: Written communications pursuant to Rule 425 under the Securities Act (17 CFR ) Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR a-12) Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR d-2(b)) Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR e-4c)) Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 ( of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 ( b-2 of this chapter). Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or

2 revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

3 Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. Item 5.02(c), (e) Appointment of Brian T. Nicholson as Chief Financial Officer On April 27, 2018, the Board of Directors of each of Extended Stay America, Inc. ( Extended Stay ) and ESH Hospitality, Inc. ( ESH REIT and, together with Extended Stay, the Company ) announced that Brian T. Nicholson will be appointed to serve as the next Chief Financial Officer of both companies prior to their May 16, 2018 annual meetings of shareholders. Mr. Nicholson, 48, returns to the Company after serving in executive roles with multi-unit, consumer-facing companies over the past three years. Since 2016, he has served as Chief Financial Officer for The Fresh Market, Inc., a specialty food retailer with over 175 stores, where he also served as Interim Chief Executive Officer from June 2017 to September From 2015 to 2016, Mr. Nicholson was the Executive Vice President and Chief Financial Officer for Driven Brands, Inc., a private equity-owned multi-brand automotive company with both franchised and company-owned businesses including Meineke Car Care, Maaco, Radiator, CARSTAR, and Take 5 Oil Change. From 2012 to 2015, Mr. Nicholson was the Vice President of Financial Planning & Analysis for the Company, a period that included the Company s initial public offering. He previously served in finance, strategy, and consulting roles for The Fresh Market, Inc. and ScottMadden, Inc. In connection with Mr. Nicholson s hiring as the Company s Chief Financial Officer, the Company and Mr. Nicholson entered into a letter agreement, dated April 26, The letter agreement provides that Mr. Nicholson will be entitled to an initial annual base salary of $460,000 and eligible to earn a target annual bonus of $460,000 (with any bonus earned in 2018 prorated according to Mr. Nicholson s date of hire) in accordance with the terms of the Extended Stay America, Inc. Annual Incentive Plan. Mr. Nicholson will receive a sign-on equity award consisting of 15,000 restricted stock units, which restricted stock units will vest in thirds on the next three anniversaries of the date of grant, as well as a one-time payment of $40,000 which will be payable in the first pay period following 30 days of employment. Pursuant to the letter agreement, Mr. Nicholson will be eligible to participate in the Company s annual equity program, with an award under the program for 2019, subject to the approval of the Compensation Committee of the Board of Directors of each of Extended Stay and ESH REIT, of $460,000. Mr. Nicholson will also be eligible to participate in the Company s Executive Severance Plan in accordance with its terms, which include one year of base salary and target annual bonus upon a qualifying termination of employment. The foregoing description is qualified in its entirety by reference to the full text of the letter agreement between the Company and Mr. Nicholson, which is included as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference. There are no arrangements or understandings between Mr. Nicholson and any other person pursuant to which Mr. Nicholson was hired as Chief Financial Officer of the Company. Mr. Nicholson has not entered into any transactions with the Company that are required to be disclosed pursuant to Item 404(a) of Regulation S-K. There are no family relationships between Mr. Nicholson and any of the Company s officers or directors that are required to be disclosed pursuant to Item 401(d) of Regulation S-K. The Company and Mr. Nicholson will enter into the Company s standard form of indemnification agreement for directors and officers, a copy of which was previously filed as Exhibit to Amendment No. 8 to the Registration Statement on Form S-1 (File No ) and is incorporated herein by reference. A copy of the press release announcing Mr. Nicholson s appointment is attached hereto as Exhibit Item 7.01 Regulation FD Disclosure On April 27, 2018, the Company issued a press release regarding the leadership transition discussed above in Item A copy of such press release is attached to this Current Report on Form 8-K as Exhibit 99.1 and is incorporated herein by reference. The information in this Item 7.01 (including Exhibit 99.1) is being furnished pursuant to Regulation FD and shall not be deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the Exchange

4 Act ), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing. The furnishing of the information in this Item 7.01 is not intended to, and does not, constitute a determination or admission by the Company that this information is material or complete, or that investors should consider this information before making an investment decision with respect to any security of the Company. Item 9.01 (d) Exhibits Financial Statements and Exhibits Letter Agreement by and between Extended Stay America, Inc. and Brian T. Nicholson, dated April 26, Press release of Extended Stay America, Inc. and ESH Hospitality, Inc., dated April 27, Management contract or compensatory plan or arrangement.

5 EXHIBIT INDEX Exhibit Number Exhibit Description 10.1 Letter Agreement by and between Extended Stay America, Inc. and Brian T. Nicholson, dated April 26, Press release of Extended Stay America, Inc. and ESH Hospitality, Inc., dated April 27, Management contract or compensatory plan or arrangement.

6 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, each of the Registrants has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. EXTENDED STAY AMERICA, INC. Date: April 27, 2018 By: /s/ John R. Dent Name: John R. Dent Title: General Counsel ESH HOSPITALITY, INC. Date: April 27, 2018 By: /s/ John R. Dent Name: John R. Dent Title: General Counsel

7 Exhibit 10.1 April 19, 2018 Dear Brian: We appreciate the opportunities we had to meet with you and feel that you are a great candidate for the position of Executive Vice President & Chief Financial Officer of Extended Stay America. The following outlines the terms of our offer: Position: Reporting to: Annual Salary: Annual Bonus Eligibility: Annual Equity Plan: Initial Equity Award: Benefits: Vacation: Lump Sum Payment: Severance: Anticipated Start Date: Chief Financial Officer Jonathan Halkyard, Chief Executive Officer Annual Base salary of $460,000 to be paid on a biweekly basis $460,000 at target. Terms of the annual bonus plan are subject to change each year as determined by the Compensation Committee. Any bonus earned in 2018 will be prorated based on your date of hire You will be eligible to participate in the annual equity program which is approved by the Company s Compensation Committee. Your equity award in 2019 will be $460,000 which will be administered in accordance with the 2019 approved LTIP The Company will grant you 15,000 RSU s. These RSU s will vest in thirds each of the next three years on the anniversary of your hire date You will be eligible to enroll in Company offered benefit plan(s) You will be eligible for 4 weeks of vacation plus personal days You will be eligible for a one time lump sum payment of $40,000 (less applicable taxes and deductions) that will be paid the first pay period following 30 days of employment. This lump sum is intended to assist you with your relocation as well as other related transition costs (e.g. COBRA) You will be eligible to participate in the Executive Severance Plan which provides 1 year s base and target bonus should you be terminated not for cause or voluntary resignation. The terms of the Plan apply To be determined. Public announcement of your hiring will coincide with the Company s First Quarter earnings announcement

8 Brian, your employment and compensation with the Company will be at will in that they can be terminated with or without cause, and with or without notice, at any time, at the option of either the Company or yourself, except as otherwise prohibited by law. The terms of this letter, therefore, do not and are not intended to create either an expressed and/or implied contract of employment with Extended Stay America. Please feel free to contact me if you have any questions. We are very excited about having you re-join the Team! Sincerely, /s/ Kevin A. Henry Kevin Henry Chief Human Resources Officer Your signature below indicates acceptance of the position and the provisions of the offer as stated herein. Signature /s/ Brian T. Nicholson Date April 26, 2018 Please note that on the first date of employment, you will need to present your social security card. You will also be required to complete the employee s portion of the I-9 Form on your first day of employment and present acceptable documentation that verifies your identity and your eligibility to work in the US. Additionally, in order to establish your Direct Deposit account, you will need to complete a Direct Deposit Form that will require your checking account information. Please be sure that you have a voided check that can be attached to the Direct Deposit form to ensure that your correct account information is provided to Payroll.

9 Exhibit 99.1 EXTENDED STAY AMERICA APPOINTS BRIAN T. NICHOLSON AS CHIEF FINANCIAL OFFICER CHARLOTTE, N.C. April 27, 2018 (GlobeNewswire) Extended Stay America, Inc. ( ESA ) and its paired-share REIT, ESH Hospitality, Inc. ( ESH ), (NYSE: STAY and collectively, the Company ) today announced that Brian T. Nicholson will be appointed to serve as the next Chief Financial Officer of both companies prior to their May 16, 2018 annual meetings of shareholders. Mr. Nicholson, 48, returns to the Company after serving in executive roles with multi-unit, consumer-facing companies over the past three years. Since 2016, he has served as Chief Financial Officer for The Fresh Market, Inc., a specialty food retailer with over 175 stores, where he also served as Interim Chief Executive Officer from June 2017 to September From 2015 to 2016, Mr. Nicholson was the Executive Vice President and Chief Financial Officer for Driven Brands, Inc., a private equity-owned multi-brand automotive company with both franchised and company-owned businesses including Meineke Car Care, Maaco, Radiator, CARSTAR, and Take 5 Oil Change. From 2012 to 2015, Mr. Nicholson was the Vice President of Financial Planning & Analysis for the Company, a period that included the Company s initial public offering. He previously served in finance, strategy, and consulting roles for The Fresh Market, Inc. and ScottMadden, Inc. Mr. Nicholson is a graduate of the University of North Carolina at Chapel Hill and holds a Master of Business Administration from Wake Forest University. Jonathan Halkyard, President and Chief Executive Officer of ESA and ESH, said, We are delighted to welcome Brian Nicholson back to the Extended Stay America family. A nationwide search process confirmed what we already knew: that Brian s intimate knowledge of our operating model, balance sheet, paired share structure, and core business, combined with the executive experience that he has gained over the past three years in other franchising, real estate, and retail businesses, makes him the ideal candidate to lead our way forward as we continue to execute on our ESA 2.0 initiatives. Mr. Halkyard added, I d also like to thank David Clarkson for his outstanding service as our Interim Chief Financial Officer since January 1, David will return to his role leading our Treasury and FP&A functions, reporting directly to Brian. 1

10 Mr. Nicholson said, I d like to thank Jonathan and the Boards of Directors for appointing me to succeed Jonathan as CFO. With the launch of ESA 2.0, Extended Stay America is positioned to do great things in the coming years, and I couldn t be happier to be rejoining the company at such a transformative time. Forward Looking Statements This release contains forward-looking statements within the meaning of the federal securities laws. Statements related to, among other things, future financial performance and execution of the Company s ESA 2.0 initiatives, involve known and unknown risks, uncertainties and other factors that may cause the Company s actual results or performance to differ from those projected in the forward-looking statements, possibly materially. For a description of factors that may cause the Company s actual results or performance to differ from projected results or performance implied by forward-looking statements, please review the information under the headings Cautionary Note Regarding Forward-Looking Statements and Risk Factors included in the Company s combined annual report on Form 10-K filed with the Securities and Exchange Commission ( SEC ) on February 27, 2018 and other documents of the Company on file with or furnished to the SEC. Any forward-looking statements made in this release are qualified by these cautionary statements, and there can be no assurance that the actual results or developments anticipated by the Company will be realized or, even if substantially realized, will have the expected consequences to, or effects on, the Company, its business or operations. Except as required by law, the Company undertakes no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future developments or otherwise. We caution you that actual results may differ materially from what is expressed, implied or forecasted by the Company s forward-looking statements. About Extended Stay America Extended Stay America, Inc. ( ESA ) is the largest integrated hotel owner/operator in North America. Its subsidiary, ESH Hospitality, Inc. ( ESH ), is the largest lodging REIT in North America by unit and room count, with 598 hotels and approximately 66,000 rooms in the U.S. ESA manages all of ESH s hotel properties in addition to 27 Extended Stay America branded hotels for third parties, providing over 8,000 jobs at Extended Stay America hotels and corporate headquarters. Extended Stay America is the leading brand in the mid-priced extended stay segment, with approximately twice as many rooms as its nearest competitor. Visit for more information. Contacts Investors: Media: Rob Ballew Terry Atkins (980) (980) investorrelations@esa.com tatkins@esa.com 2