STAY Extended Stay America Inc

COMPANY PROPOSAL 3: PROPOSAL TO APPROVE ADJOURNMENT OF THE MEETING

The Company is asking its stockholders to vote on a proposal to approve any adjournments of the special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the special meeting to adopt the merger agreement and approve the mergers and other transactions contemplated by the merger agreement.

Assuming that a quorum is present, approval of the proposal to approve any such adjournment of the special meeting requires the affirmative vote of a majority of the votes cast on the proposal. Approval of this proposal is a not a condition to the completion of the mergers. If a quorum is not present at the Company special meeting, approval of the proposal to approve any such adjournment of the special meeting requires the affirmative vote of the holders of a majority of the voting power of the stock present in person or by proxy at the meeting and entitled to vote thereon. If you properly authorize your proxy by mail, by telephone or through the Internet, but do not indicate instructions to vote your shares of Company common stock “FOR,” “AGAINST” or “ABSTAIN” on this Proposal 3, your shares of Company common stock will be voted in accordance with the recommendation of the Company board, which is “FOR” this Company Proposal 3. Assuming a quorum is present, an abstention or failure to vote on this proposal will have no effect on the approval of this proposal.

Recommendation of the Company Board

The Company board unanimously recommends that the Company’s stockholders vote “FOR” the proposal to approve any adjournment of the special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the special meeting to adopt the merger agreement and approve the mergers and other transactions contemplated by the merger agreement.

32

HOSPITALITY PROPOSAL 1: PROPOSAL TO ADOPT THE MERGER AGREEMENT

Hospitality is asking its stockholders to vote on a proposal to adopt the merger agreement and approve the mergers and other transactions contemplated by the merger agreement.

For detailed information regarding this proposal, see the information about the mergers and the merger agreement throughout this joint proxy statement, including the information set forth in the sections entitled “The Mergers” and “The Merger Agreement.” A copy of the merger agreement is attached as Exhibit A to this joint proxy statement.

Approval of the proposal to adopt the merger agreement and approve the mergers and other transactions contemplated by the merger agreement requires the affirmative vote of the holders shares of Hospitality class A common stock and Hospitality class B common stock entitled to cast not less than a majority of all of the votes entitled to be cast on the matter. If you properly authorize your proxy by mail, by telephone or through the Internet, but do not indicate instructions to vote your shares of Hospitality class B common stock “FOR,” “AGAINST” or “ABSTAIN” on this Hospitality Proposal 1, your shares of Hospitality class B common stock will be voted in accordance with the recommendation of the Hospitality board, which is “FOR” this Hospitality Proposal 1. Because the required vote for this proposal is based on the number of votes of the holders of Hospitality class A common stock and Hospitality class B common stock that are entitled to cast rather than on the number of votes cast, failure to vote your shares of Hospitality class B common stock (including failure to give voting instructions to your broker, bank or other nominee) and abstentions will have the same effect as voting “AGAINST” the proposal to adopt the merger agreement and approve the mergers and other transactions contemplated by the merger agreement.

Approval of this proposal is a condition to the completion of the mergers. In the event this proposal is not approved, the mergers cannot be completed.

Recommendation of the Hospitality Board

The Hospitality board recommends that Hospitality’s stockholders vote “FOR” the proposal to adopt the merger agreement and approve the mergers and other transactions contemplated by the merger agreement.

33

HOSPITALITY PROPOSAL 2: PROPOSAL TO APPROVE THE MERGER-RELATED COMPENSATION

Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and Rule 14a-21(c) under the Exchange Act, Hospitality is asking its stockholders to vote at the special meeting on an advisory basis regarding the compensation that may be paid or become payable to Hospitality’s named executive officers that is based on or otherwise relates to the mergers. Information intended to comply with Item 402(t) of Regulation S-K concerning this compensation, subject to certain assumptions described therein, is presented in the section entitled “The Mergers—Interests of the Company’s and Hospitality’s Directors and Executive Officers in the Mergers.”

The stockholder vote on executive compensation is an advisory vote only, and it is not binding on Hospitality or its board. Further, the underlying arrangements are contractual in nature and not, by their terms, subject to stockholder approval. Accordingly, regardless of the outcome of the advisory vote, if the mergers are completed, Hospitality’s named executive officers will be eligible to receive the compensation that may be paid or become payable to Hospitality’s named executive officers that is based on or otherwise relates to the mergers, in accordance with the terms and conditions applicable to such compensation. Approval of this proposal is not a condition to the completion of the mergers.

Hospitality is asking its stockholders to vote “FOR” the following resolution:

“RESOLVED, that the ESH Hospitality, Inc. stockholders approve, on a non-binding, advisory basis, the compensation that may be paid or become payable to the named executive officers of ESH Hospitality, Inc. that is based on or otherwise relates to the merger, as disclosed pursuant to Item 402(t) of Regulation S-K under the heading “The Mergers—Interests of the Company’s and Hospitality’s Directors and Executive Officers in the Mergers” beginning on page 75 (which disclosure includes the Golden Parachute Compensation Table required pursuant to Item 402(t) of Regulation S-K).”

Adoption of the above resolution, on a non-binding, advisory basis, requires the affirmative vote of a majority of the votes cast on the proposal. If you properly authorize your proxy by mail, by telephone or through the Internet, but do not indicate instructions to vote your shares of Hospitality class B common stock “FOR,” “AGAINST” or “ABSTAIN” on this Hospitality Proposal 2, your shares of Hospitality class B common stock will be voted in accordance with the recommendation of the Hospitality board, which is “FOR” this Hospitality Proposal 2. An abstention or failure to vote on this proposal will have no effect on the approval of this proposal.

Recommendation of the Hospitality Board

The Hospitality board unanimously recommends that Hospitality’s stockholders vote “FOR” the proposal to approve, on a non-binding, advisory basis, the compensation that may be paid or become payable to Hospitality’s named executive officers that is based on or otherwise relates to the mergers.

34

THE PARTIES TO THE MERGERS

Extended Stay America, Inc.

11525 N. Community House Road, Suite 100

Charlotte, North Carolina 28277

(980) 345-1784

Extended Stay America, Inc., which we refer to as “we,” “our,” “us,” or the “Company,” is a Delaware corporation. Extended Stay America-branded hotels are designed to provide an affordable and attractive alternative to traditional lodging or apartment accommodations and are targeted toward self-sufficient, value-conscious guests who need lodging for a night, a week or longer. Guests include business travelers, leisure travelers, professionals on temporary work or training assignments, persons relocating, the temporarily displaced, those purchasing a home and anyone else in need of accommodations. The Company’s website is www.extendedstayamerica.com. The information found on, or otherwise accessible through, our website is not incorporated into, and does not form a part of, this joint proxy statement or any other report or document we file with or furnish to the SEC. The Company’s shares of common stock are paired with and trade together with shares of class B common stock of ESH Hospitality, Inc. Those paired shares are listed on NASDAQ under the symbol “STAY.” For additional information about us and our business, please refer to “Where You Can Find More Information.”

ESH Hospitality, Inc.

11525 N. Community House Road, Suite 100

Charlotte, North Carolina 28277

(980) 345-1784

ESH Hospitality, Inc., is a Delaware corporation and has elected to be taxed as a real estate investment trust, or REIT, under the Internal Revenue Code of 1986, as amended, or the Code. As of the close of business on the record date, the Company owned shares of Hospitality class A common stock representing approximately 58% of the voting power of the Hospitality class A common stock and Hospitality class B common stock, voting together as a single class, entitled to vote at the Hospitality special meeting.

Parent, MergerCo 1 and MergerCo 2

Eagle Parent Holdings L.P.

c/o The Blackstone Group

345 Park Avenue

New York, New York 10154

(212) 583-5000

and

c/o Starwood Capital Group

591 West Putnam Avenue

Greenwich, Connecticut 06830

Eagle Parent Holdings L.P. (which we refer to as “Parent”) is a Delaware limited partnership that is jointly owned by affiliates of Blackstone Real Estate Partners IX L.P. (which we refer to as the “Blackstone Sponsor”) and Starwood Distressed Opportunity Fund XII Global, L.P. (which we refer to as the “Starwood Sponsor” and together with the Blackstone Sponsor, the “Sponsors”). Parent was formed solely for the purpose of engaging in the transactions contemplated by the merger agreement, has engaged in no other business activities and has conducted its operations only incidentally to its formation or in furtherance of the transactions contemplated by the merger agreement. The Blackstone sponsor is an affiliate of The Blackstone Group Inc. (which we refer to as “Blackstone”). The Starwood Sponsor is an affiliate of Starwood Capital Group (which we refer to as “Starwood”).

35

Blackstone is a global leader in real estate investing. Blackstone’s real estate business was founded in 1991 and has $187 billion of investor capital under management. Blackstone is one of the largest property owners in the world, owning and operating assets across every major geography and sector, including logistics, multifamily and single-family housing, office, hospitality and retail. Blackstone’s opportunistic funds seek to acquire undermanaged, well-located assets across the world. Blackstone’s Core+ strategy invests in substantially stabilized real estate globally through regional open-ended funds focused on high-quality assets and Blackstone Real Estate Income Trust, Inc., a non-listed REIT that invests in U.S. income-generating assets. Blackstone Real Estate also operates one of the leading global real estate debt businesses, providing comprehensive financing solutions across the capital structure and risk spectrum, including management of Blackstone Mortgage Trust (NYSE: BXMT).

Starwood Capital Group is a private investment firm with a core focus on global real estate, energy infrastructure and oil & gas. Starwood and its affiliates maintain 16 offices in seven countries around the world, and currently have approximately 4,100 employees. Since its inception in 1991, Starwood Capital Group has raised over $55 billion of equity capital, and currently has in excess of $75 billion of assets under management. Through a series of comingled opportunity funds and Starwood Real Estate Income Trust, Inc., a non-listed REIT, Starwood has invested in virtually every category of real estate on a global basis, opportunistically shifting asset classes, geographies and positions in the capital stack as it perceives risk/reward dynamics to be evolving. Starwood Capital also manages Starwood Property Trust (NYSE: STWD), the largest commercial mortgage real estate investment trust in the United States, which has successfully deployed over $63 billion of capital since inception and manages a portfolio of over $17 billion across debt and equity investments. Over the past 29 years, Starwood Capital Group and its affiliates have successfully executed an investment strategy that involves building enterprises in both the private and public markets.

Eagle Merger Sub 1 Corporation

c/o The Blackstone Group

345 Park Avenue

New York, New York 10154

(212) 583-5000

and

c/o Starwood Capital Group

591 West Putnam Avenue

Greenwich, Connecticut 06830

Eagle Merger Sub 1 Corporation (which we refer to as “MergerCo 1”) is a Delaware corporation. MergerCo 1 is a wholly owned subsidiary of Parent. MergerCo 1 was formed solely for purposes of engaging in the transactions contemplated by the merger agreement, has engaged in no other business activities and has conducted its operations only incidentally to its formation or in furtherance of the transactions contemplated by the merger agreement. Pursuant to the merger agreement, on the closing date, MergerCo 1 will merge with and into the Company, and the Company will continue as the surviving entity.

36

Eagle Merger Sub 2 Corporation

c/o The Blackstone Group

345 Park Avenue

New York, New York 10154

(212) 583-5000

and

c/o Starwood Capital Group

591 West Putnam Avenue

Greenwich, Connecticut 06830

Eagle Merger Sub 2 Corporation (which we refer to as “MergerCo 2”) is a Delaware corporation. MergerCo 2 is a wholly owned subsidiary of MergerCo 1. MergerCo 2 was formed solely for purposes of engaging in the transactions contemplated by the merger agreement, has engaged in no other business activities and has conducted its operations only incidentally to its formation or in furtherance of the transactions contemplated by the merger agreement. Pursuant to the merger agreement, on the closing date, MergerCo 2 will merge with and into Hospitality, and Hospitality will continue as the surviving entity.

37

THE COMPANY SPECIAL MEETING

Date, Time and Purpose of the Company Special Meeting

This joint proxy statement is being furnished to holders of Company common stock in connection with the solicitation of proxies by the Company board to be exercised at the Company special meeting which will be conducted exclusively online via live audio webcast at www.virtualshareholdermeeting.com/STAY2021SM starting at 8:30 a.m. Eastern Time, on June 8, 2021. You will be able to attend the Company special meeting online and vote your shares electronically at the Company special meeting by entering your control number, which is included on the WHITE proxy card that you received. Because the Company special meeting is completely virtual and being conducted online via live audio webcast, Company stockholders will not be able to attend the meeting in person. The purpose of the Company special meeting is for you to consider and vote on the following matters:

Pursuant to the Company’s bylaws, all business to be conducted at the Company special meeting must be brought before the meeting pursuant to the Company’s notice of meeting. The affirmative vote of holders of Company common stock entitled to cast not less than a majority of all of the votes entitled to be cast on the matter is required to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement and for the mergers to occur. A copy of the merger agreement is attached as Exhibit A to this joint proxy statement, which the Company encourages you to read carefully in its entirety.

Record Date, Notice and Quorum

All holders of record of the Company common stock as of the record date, which was the close of business on April 19, 2021, are entitled to receive notice of and attend and vote at the Company special meeting or any postponement or adjournment of the Company special meeting. Each Company stockholder will be entitled to cast one vote on each matter presented at the Company special meeting for each share of Company common stock that such holder owned as of the record date. On the record date, there were 177,730,773 shares of Company common stock outstanding and entitled to vote at the Company special meeting.

The presence in person (which would include presence at a virtual meeting) or by proxy of the Company stockholders entitled to cast a majority of all of the votes entitled to be cast at the Company special meeting will constitute a quorum for purposes of the Company special meeting. A quorum is necessary to transact business at the Company special meeting. Abstentions will be counted as shares present for the purposes of determining the presence of a quorum. If a quorum is not present at the Company special meeting, the Company expects that the Company special meeting will be adjourned to a later date. Pursuant to the Company’s bylaws, the chairman of the meeting may adjourn the meeting, whether or not a quorum is present, to a later time and place announced at the Company special meeting, even if the Company’s stockholders have not approved the proposal to adjourn the special meeting.

Required Vote

Completion of the mergers requires adoption of the merger agreement and approval of the mergers and the other transactions contemplated by the merger agreement by the affirmative vote of the holders of Company common

38

stock entitled to cast not less than a majority of all of the votes entitled to be cast on the matter. Each Company stockholder is entitled to cast one vote on each matter presented at the Company special meeting for each share of Company common stock owned by such stockholder on the record date.

Because the required vote for this proposal is based on the number of votes the Company’s stockholders are entitled to cast rather than on the number of votes cast, if you fail to vote by proxy or in person (including by abstaining) (which would include presence at a virtual meeting), or fail to instruct your broker on how to vote, such failure will have the same effect as voting against the proposal to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement.

In addition, the approval of the proposal regarding the non-binding, advisory vote on the compensation that may be paid or become payable to the Company’s named executive officers that is based on or otherwise relates to the mergers, and assuming a quorum is present, the approval of the proposal regarding any adjournment of the Company special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the Company special meeting to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement, each requires the affirmative vote of a majority of the votes cast on the proposal. Approval of these proposals is not a condition to completion of the mergers. For the purpose of each of these proposals, if you fail to vote by proxy or in person (which would include presence at a virtual meeting), or fail to instruct your broker on how to vote, it will not have any effect on the outcome of such proposals. Abstentions are not considered votes cast and therefore will have no effect on the outcome of these proposals assuming a quorum is present. Accordingly, in order for your shares of Company common stock to be voted, if you are a stockholder of record, you must either return the enclosed WHITE proxy card, authorize your proxy or voting instructions by telephone or through the Internet or vote in person (which would include presence at a virtual meeting) at the Company special meeting.

As of the record date, the Company’s directors and executive officers owned and are entitled to vote an aggregate of approximately 1,339,801 of the shares of Company common stock, entitling them to exercise approximately 0.8% of the voting power of the Company common stock entitled to vote at the Company special meeting. The Company’s and Hospitality’s directors and executive officers have informed us that they intend to vote the shares of Company common stock that they own in favor of: (1) the proposal to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement (other than Neil T. Brown and Simon M. Turner, each a director of the Hospitality board and who own 51,645 and 1,564 shares of Company common stock, respectively, as of the close of business on the record date), (2) the proposal regarding the non-binding, advisory vote on the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the mergers and (3) the proposal to approve any adjournment of the Company special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the Company special meeting to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement, although they have no obligation to do so.

Votes cast by proxy or in person (which would include presence at a virtual meeting) at the Company special meeting will be counted by the person appointed by the Company to act as inspector of election for the Company special meeting. The inspector of election will also determine the number of shares of Company common stock represented at the Company special meeting, in person or by proxy.

How to Authorize a Proxy

Holders of record of the Company common stock may vote or cause their shares to be voted by proxy using one of the following methods:

39

Regardless of whether you plan to attend the Company special meeting, the Company requests that you authorize a proxy for your shares of Company common stock as described above as promptly as possible.

Under NASDAQ rules, all of the proposals in this joint proxy statement are non-routine matters, so there can be no broker non-votes at the Company special meeting. A broker non-vote occurs when shares held by a bank, broker, trust or other nominee are represented at a meeting, but the bank, broker, trust or other nominee has not received voting instructions from the beneficial owner and does not have the discretion to direct the voting of the shares on a particular proposal but has discretionary voting power on other proposals at such meeting. Accordingly, if you own Company common stock through a broker, bank or other nominee (i.e., in “street name”), you must provide voting instructions in accordance with the instructions on the voting instruction card that your broker, bank or other nominee provides to you, as brokers, banks and other nominees do not have discretionary voting authority with respect to any of the three proposals described in this joint proxy statement. You should instruct your broker, bank or other nominee as to how to vote your shares of Company common stock following the directions contained in such voting instruction card. If you have not received such voting instructions or require further information regarding such voting instructions, contact your broker, bank or other nominee who can give you directions on how to vote your shares of Company common stock. If you hold your shares of Company common stock through a broker, bank or other nominee and wish to vote in person at the Company special meeting, you must obtain a “legal proxy,” executed in your favor, from the broker, bank or other nominee (which may take several days). Because the proposal to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement requires the affirmative vote of the holders of Company common stock entitled to cast not less than a majority of all of the votes entitled to be cast on the matter, the failure to provide your bank, broker, trust or other nominee with voting instructions will have the same effect as a vote “AGAINST” the proposal to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement. Because the required vote on the approval of each of (1) the non-binding compensation advisory proposal and (2) the proposal to adjourn the Company special meeting if necessary or appropriate are each based on the number of shares present and/or voting at the Company special meeting, and because your bank, broker, trust or other nominee does not have discretionary authority to vote on either proposal, the failure to provide your bank, broker, trust or other nominee with voting instructions will have no effect on approval of either proposal, assuming a quorum is present.

Proxies and Revocation

If you authorize a proxy, your shares of Company common stock will be voted at the Company special meeting as you indicate on your proxy. If no instructions are indicated when you authorize your proxy, your shares of Company common stock will be voted in accordance with the recommendations of the Company board. The Company board recommends that you vote “FOR” the proposal to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement, “FOR” the proposal to approve, on a non-binding, advisory basis, the compensation that may be paid or become payable to the Company’s named executive officers that is based on or otherwise relates to the merger and “FOR” the proposal to approve any adjournment of the Company special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the Company special meeting to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement.

You may revoke your proxy at any time, but only before the proxy is voted at the Company special meeting, in any of three ways:

40

Attendance at the Company special meeting will not, in itself, constitute revocation of a previously granted proxy. If you own Company common stock in “street name,” you may revoke or change previously granted voting instructions by following the instructions provided by the broker, bank or other nominee that is the registered owner of the shares.

Pursuant to the Company’s bylaws, all business to be conducted at the Company special meeting must be brought before the meeting pursuant to the Company’s notice of meeting.

Solicitation of Proxies

The Company will bear the cost of solicitation of proxies for the Company special meeting. In addition to the use of mails, proxies may be solicited by personal interview, telephone, facsimile, e-mail or otherwise, by the Company’s officers, directors and other employees, for which they will not receive additional compensation. The Company has engaged Okapi Partners LLC to assist in the solicitation of proxies for a fee of up to approximately $250,000, plus a one time performance fee to be determined, plus reimbursement of out-of-pocket expenses, and the Company has agreed to indemnify Okapi Partners LLC and its members, officers, directors, employees, agents and affiliates against certain losses, costs and expenses. The Company also will request persons, firms and corporations holding Company common stock in their names, or in the names of their nominees, that are beneficially owned by others to send or cause to be sent proxy materials to, and obtain proxies from, such beneficial owners and will reimburse such holders for their reasonable expenses in so doing.

Adjournments

Although it is not currently expected, the Company special meeting may be adjourned for the purpose of soliciting additional proxies if the holders of a sufficient number of shares of Company common stock are not present at the Company special meeting, in person or by proxy, to constitute a quorum or if the Company believes it is reasonably likely that the merger agreement will not be adopted and the mergers and the other transactions contemplated by the merger agreement approved at the Company special meeting when convened on June 8, 2021, or when reconvened following any adjournment. Any meeting may be adjourned for up to 30 days without notice (other than by an announcement at the Company special meeting of the date, time and place, if any of the adjourned meeting), by the chairman of the meeting, whether or not a quorum is present (subject to certain restrictions in the merger agreement, including that the Company special meeting generally may not be held, without Parent’s consent, on a date that is more than 30 days after the date on which the Company special meeting was originally scheduled).

Postponements

At any time prior to convening the Company special meeting, the Company may postpone the Company special meeting for any reason without the approval of its stockholders (subject to certain restrictions in the merger agreement, including that the Company special meeting generally may not be held, without Parent’s consent, on a date that is more than 30 days after the date on which the Company special meeting was originally scheduled).

41

THE HOSPITALITY SPECIAL MEETING

Date, Time and Purpose of the Hospitality Special Meeting

This joint proxy statement is being furnished to holders of Hospitality class B common stock in connection with the solicitation of proxies by the Hospitality board to be exercised at the Hospitality special meeting which will be conducted exclusively online via live audio webcast at www.virtualshareholdermeeting.com/STAY2021SM starting at 9:30 a.m. Eastern Time, on June 8, 2021. You will be able to attend the Hospitality special meeting online and vote your shares electronically at the Hospitality special meeting by entering your control number, which is included on the WHITE proxy card that you received. Because the Hospitality special meeting is completely virtual and being conducted online via live audio webcast, Hospitality stockholders will not be able to attend the meeting in person. The purpose of the Hospitality special meeting is for you to consider and vote on the following matters:

Pursuant to Hospitality’s bylaws, all business to be conducted at the Hospitality special meeting must be brought before the meeting pursuant to Hospitality’s notice of meeting. The affirmative vote of holders of Hospitality class B common stock entitled to cast not less than a majority of all of the votes entitled to be cast on the matter is required to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement and for the mergers to occur. A copy of the merger agreement is attached as Exhibit A to this joint proxy statement, which Hospitality encourages you to read carefully in its entirety.

Record Date, Notice and Quorum

All holders of record of Hospitality class B common stock as of the record date, which was the close of business on April 19, 2021, are entitled to receive notice of and attend and vote at the Hospitality special meeting or any postponement of the Hospitality special meeting. Each Hospitality stockholder will be entitled to cast one vote on each matter presented at the Hospitality special meeting for each share of Hospitality class B common stock that such holder owned as of the record date. On the record date, there were 177,730,773 shares of Hospitality class B common stock outstanding and entitled to vote at the Hospitality special meeting.

The presence in person (which would include presence at a virtual meeting) or by proxy of the Hospitality stockholders entitled to cast a majority of all of the votes entitled to be cast at the Hospitality special meeting will constitute a quorum for purposes of the Hospitality special meeting. A quorum is necessary to transact business at the Hospitality special meeting. Abstentions will be counted as shares present for the purposes of determining the presence of a quorum.

Required Vote

Completion of the mergers requires adoption of the merger agreement and approval of the mergers and the other transactions contemplated by the merger agreement by the affirmative vote of the holders of Hospitality common stock entitled to cast not less than a majority of all of the votes entitled to be cast on the matter. Each Hospitality stockholder is entitled to cast one vote on each matter presented at the Hospitality special meeting for each share of Hospitality class A common stock or Hospitality class B common stock owned by such stockholder on the record date. Because the required vote for this proposal is based on the number of votes Hospitality’s stockholders are entitled to cast rather than on the number of votes cast, if you fail to vote by proxy or in person (including by abstaining) (which consists of presence at a virtual meeting), or fail to instruct your broker on how to vote, such failure will have the same effect as voting against the proposal to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement.

42

The Company is the sole holder of Hospitality class A common stock, which constitutes 58% of the voting power of the outstanding Hospitality class A common stock and Hospitality class B common stock, voting together as a single class, as of the close of business on the record date. The Company will vote its shares of Hospitality class A common stock at the Hospitality special meeting to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement and approve the proposal regarding the non-binding, advisory vote on the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the mergers.

In addition, the approval of the proposal regarding the non-binding, advisory vote on the compensation that may be paid or become payable to Hospitality’s named executive officers that is based on or otherwise relates to the mergers requires the affirmative vote of a majority of the votes cast on the proposal. Approval of this proposal is not a condition to completion of the mergers. For the purpose of this proposal, if you fail to vote by proxy or in person (which would include presence at a virtual meeting), or fail to instruct your broker on how to vote, it will not have any effect on the outcome of such proposal. Abstentions are not considered votes cast and therefore will have no effect on the outcome of this proposal.

Accordingly, in order for your shares of Hospitality class B common stock to be voted, if you are a stockholder of record, you must either return the enclosed WHITE proxy card, authorize your proxy or voting instructions by telephone or through the Internet or vote in person (which would include presence at a virtual meeting) at the Hospitality special meeting. The vote of the holders of Hospitality’s preferred stock is not required to approve any of the proposals at the Hospitality special meeting and is not being solicited.

As of the record date, Hospitality’s directors and executive officers owned and are entitled to vote an aggregate of approximately 1,339,801 of the shares of Hospitality class B common stock, entitling them to exercise approximately 0.8% of the voting power of Hospitality class B common stock entitled to vote at the Hospitality special meeting. The Company’s and Hospitality’s directors and executive officers have informed us that they intend to vote the Hospitality class B common stock that they own in favor of: (1) the proposal to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement (other than the Messrs. Brown and Turner, each a director of the Hospitality board and who own 51,645 and 1,564 shares of Hospitality class B common stock, respectively, as of the close of business on the record date), and (2) the proposal regarding the non-binding, advisory vote on the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the mergers.

Votes cast by proxy or in person (which would include presence at a virtual meeting) at the Hospitality special meeting will be counted by the person appointed by Hospitality to act as inspector of election for the Hospitality special meeting. The inspector of election will also determine the number of shares of Hospitality class B common stock represented at the Hospitality special meeting, in person or by proxy.

How to Authorize a Proxy

Holders of record of the Hospitality class B common stock may vote or cause their shares to be voted by proxy using one of the following methods:

Regardless of whether you plan to attend the Hospitality special meeting, Hospitality requests that you authorize a proxy for your shares of Hospitality class B common stock as described above as promptly as possible.

Under NASDAQ rules, all of the proposals in this joint proxy statement are non-routine matters, so there can be no broker non-votes at the Hospitality special meeting. A broker non-vote occurs when shares held by a bank,

43

broker, trust or other nominee are represented at a meeting, but the bank, broker, trust or other nominee has not received voting instructions from the beneficial owner and does not have the discretion to direct the voting of the shares on a particular proposal but has discretionary voting power on other proposals at such meeting. Accordingly, if you own Hospitality class B common stock through a broker, bank or other nominee (i.e., in “street name”), you must provide voting instructions in accordance with the instructions on the voting instruction card that your broker, bank or other nominee provides to you, as brokers, banks and other nominees do not have discretionary voting authority with respect to any of the three proposals described in this joint proxy statement. You should instruct your broker, bank or other nominee as to how to vote your shares of Hospitality class B common stock following the directions contained in such voting instruction card. If you have not received such voting instructions or require further information regarding such voting instructions, contact your broker, bank or other nominee who can give you directions on how to vote your shares of Hospitality class B common stock. If you hold your shares of Hospitality class B common stock through a broker, bank or other nominee and wish to vote in person at the Hospitality special meeting, you must obtain a “legal proxy,” executed in your favor, from the broker, bank or other nominee (which may take several days). Because the proposal to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement requires the affirmative vote of the holders of Hospitality class B common stock entitled to cast not less than a majority of all of the votes entitled to be cast on the matter, the failure to provide your bank, broker, trust or other nominee with voting instructions will have the same effect as a vote “AGAINST” the proposal to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement. Because the approval of the non-binding compensation advisory proposal requires the affirmative vote of a majority of the votes cast on such proposal, and because your bank, broker, trust or other nominee does not have discretionary authority to vote on such proposal, the failure to provide your bank, broker, trust or other nominee with voting instructions will have no effect on approval of such proposal, assuming a quorum is present.

Proxies and Revocation

If you authorize a proxy, your shares of Hospitality class B common stock will be voted at the Hospitality special meeting as you indicate on your proxy. If no instructions are indicated when you authorize your proxy, your shares of Hospitality class B common stock will be voted in accordance with the recommendations of the Hospitality board. The Hospitality board recommends that you vote “FOR” the proposal to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement and “FOR” the proposal to approve, on a non-binding, advisory basis, the compensation that may be paid or become payable to Hospitality’s named executive officers that is based on or otherwise relates to the merger.

You may revoke your proxy at any time, but only before the proxy is voted at the Hospitality special meeting, in any of three ways:

Attendance at the Hospitality special meeting will not, in itself, constitute revocation of a previously granted proxy. If you own Hospitality class B common stock in “street name,” you may revoke or change previously granted voting instructions by following the instructions provided by the broker, bank or other nominee that is the registered owner of the shares.

Pursuant to Hospitality’s bylaws, all business to be conducted at the Hospitality special meeting must be brought before the meeting pursuant to Hospitality’s notice of meeting.

44

Postponements

At any time prior to convening the Hospitality special meeting, Hospitality may postpone the Hospitality special meeting for any reason without the approval of its stockholders (subject to certain restrictions in the merger agreement, including that the Company special meeting generally may not be held, without Parent’s consent, on a date that is more than 30 days after the date on which the Hospitality special meeting was originally scheduled).

45

THE MERGERS

General Description of the Mergers

Under the terms of the merger agreement, affiliates of Blackstone and Starwood will acquire the Company, Hospitality and their subsidiaries, through the mergers. Pursuant to the terms of the merger agreement, MergerCo 1 will merge with and into the Company, with the Company surviving the Company merger, and Hospitality will merge with and into MergerCo 2, with MergerCo 2 surviving the Hospitality merger.

Background of the Mergers

The Boards and senior management regularly evaluate the Paired Entities’ business and operations, trends in the hotel and lodging and real estate industries, and the macro-economic environment, all with a view toward creating and maximizing stockholder value. From time to time, this evaluation has included the review of potential strategic alternatives, including business combinations involving all or part of the Paired Entities, and potential alternatives to the Paired Entities’ corporate structure.

At the time of the Paired Entities’ initial public offering in 2013, the Paired Entities adopted a “paired share” structure, under which shares of the Company, the parent company, were paired with shares representing a minority interest in Hospitality, a corporation that elected to be taxed as a REIT under the Code, with the remaining equity interest in Hospitality owned by the Company. The holders of paired shares owned all of the common equity of the Company directly and all of the common equity of Hospitality, directly through their minority interest and indirectly through their ownership of the Company. This structure, which has been infrequently utilized by U.S. public companies and is not currently used by any other U.S. public company, was designed to allow the Paired Entities to obtain, partially, the tax benefits of holding real estate in REIT form while at the same time maintaining a fully integrated owner/operator model that is unique relative to other lodging industry participants, which are primarily franchise businesses that generally own and control only a small portion of their hotels. At the time of their initial public offering, the Paired Entities hoped that the public markets would ascribe more value to this unique structure and business model than may have been recognized by the public markets if a more traditional structure had been used.

In early July 2017, our then Chief Executive Officer met with a representative of Starwood during which they discussed developments in the extended stay lodging industry, and in the course of such discussions the Starwood representative expressed Starwood’s preliminary interest in exploring a possible acquisition of the Paired Entities. No specific terms were discussed, but our then Chief Executive Officer indicated that it was unlikely the Boards would be interested in pursuing any transaction for less than $24 per paired share. On July 7, 2017, Starwood submitted to the Paired Entities a written indication of interest for an acquisition of the Paired Entities at a purchase price in the range of $22 to $24 per paired share, subject to completion of due diligence.

Following receipt of this indication of interest, at the direction of the Boards and with the assistance of a financial advisor, the Paired Entities initiated a process to explore potential third party interest in an acquisition of the Paired Entities. At the direction of the Boards, the Paired Entities’ financial advisor approached two other potential acquirers, including Blackstone, that the Boards and the financial advisor believed would be most likely to be interested in a potential acquisition of the Paired Entities to ascertain their interest in considering a potential transaction. The Paired Entities provided information to Starwood pursuant to a confidentiality/standstill agreement dated August 6, 2017. The Paired Entities also provided information to Blackstone pursuant to a confidentiality/standstill agreement dated August 22, 2017. The other potential acquiror that had been approached declined to consider a potential transaction with the Paired Entities. Following discussions with the Paired Entities and a review of non-public due diligence information, on September 13, 2017 Starwood informed the Paired Entities that it was only prepared to proceed toward a transaction at a price per paired share that was unlikely to provide a material premium to the current trading price per paired share (which closed at $20.20 on September 13, 2017), but that Starwood would not proceed with a transaction in the range of its initial indication

46

of interest. The Paired Entities did not receive any other specific proposals, including from Blackstone, during the summer of 2017. In September 2017, the Paired Entities discontinued this process. During September 2017, the paired shares were trading in the range of $19.11 to $20.20 per paired share.

On November 7, 2017, the Paired Entities announced earnings for the third quarter of 2017 that failed to meet analyst expectations and lowered guidance for the 2017 fiscal year. On that date, the paired shares closed at $17.23.

On November 10, 2017, Blackstone made an unsolicited written proposal to acquire the Paired Entities at a price of $19.50 per paired share. On that date, the paired shares closed at a price of $16.81 per paired share. Blackstone’s price represented a premium of 16.0% to the closing price of the paired shares on that date, a 2.4% premium to the 30-day volume weighted average trading price (or VWAP) of the paired shares, a 6.6% discount to the 52-week high closing price and a multiple of 9.5x next twelve months estimated earnings before interest, taxes, depreciation and amortization based on IBES projections (or NTM EBITDA).

During the remainder of November 2017 and early December 2017, the Paired Entities and Blackstone engaged in discussions and Blackstone conducted due diligence. On December 6, 2017, Blackstone submitted a revised written proposal of $20.75 per paired share, which Blackstone orally indicated was its best offer. On the previous day, the paired shares closed at a price of $17.35. Blackstone’s price represented a premium of 19.6% to the previous day’s closing price of the paired shares, a 16.4% premium to the 30-day VWAP of the paired shares, a 0.6% discount to the 52-week high closing price and a multiple of 10.3x NTM EBITDA. At that time, the Paired Entities owned approximately 625 hotels (which on average were 18.5 years old).

Thereafter, the Boards of the Paired Entities met and determined that Blackstone’s revised proposal was not in the best interests of the Paired Entities’ stockholders and determined not to pursue the proposal. In rejecting Blackstone’s proposal, the Boards took into account a number of factors, including the fact that the proposal represented a discount to the highest trading price of the paired shares as recently as October 18, 2017, the Boards’ belief that the Paired Entities’ performance for the third quarter of 2017 was not reflective of the Paired Entities’ near or longer term prospects, the fact that there was an impending change to the Paired Entities’ President and Chief Executive Officer and the Boards’ belief that the Paired Entities had significant potential under new leadership, and the Boards’ view that anticipated changes in federal tax legislation could have a favorable impact on the Paired Entities’ valuation. Following this meeting, discussions with Blackstone terminated.

In December 2017, the President and Chief Executive Officer of the Paired Entities resigned and the Boards appointed the Paired Entities’ then Chief Financial Officer as the President and Chief Executive Officer. Under the new President and Chief Executive Officer, the Paired Entities planned to accelerate progress on developing Extended Stay hotels under the Paired Entities’ new design model, through the sale of non-core assets at attractive cash flow multiples while retaining franchise agreements on the sold properties, new development of Extended Stay hotels in attractive markets, sale of Extended Stay franchises and targeted capital investments (which we collectively refer to as the ESA 2.0 strategy).

On the Paired Entities’ second quarter earnings call held on July 26, 2018, the Paired Entities’ President and Chief Executive Officer noted that various research analysts were performing valuation analyses of the Paired Entities under a structure in which the Paired Entities would be separated into a REIT and an independent operating company or other method of separating the Company from Hospitality. The President and Chief Executive Officer stated that the Paired Entities intended to continue to evaluate the merits of alternatives to the Paired Entities’ corporate structure. On that date, the paired shares closed at $21.64 per paired share.

In late July 2018, at the direction of the Boards and with the assistance of a financial advisor, the Paired Entities began a process to evaluate a variety of strategic alternatives, including a sale of the Paired Entities, the potential for a sale of the Extended Stay brand and management company (with the company remaining solely as an owner

47

of real estate taxed as a REIT (which we refer to as Remainco REIT)), or other business combination transaction, as well as continuing with the Paired Entities’ business plan, including its ESA 2.0 strategy. In connection with this process, among other things, the Paired Entities’ financial advisor contacted three publicly-traded hotel franchising companies regarding their interest in a potential acquisition of the Extended Stay brand and management company, and also contacted Blackstone and another financial sponsor the Boards believed might be interested in a potential whole company transaction. In addition, a representative of the Paired Entities contacted Starwood with a view to ascertaining Starwood’s potential interest in having the Paired Entities become the owner or brand manager for certain of Starwood’s hotels. Starwood did not express any interest in pursuing a transaction.

Two of the publicly-traded hotel franchising companies (whom we refer to as Party A and Party B, respectively) expressed interest in engaging in discussions with the Paired Entities. In mid-September 2018, representatives of the Paired Entities and the Paired Entities’ financial advisor met with representatives of each of Party A and Party B. At these meetings, the Paired Entities emphasized that their focus in any potential transaction would be on the expected performance and profitability of Remainco REIT giving effect to the transaction, in view of the fact that Remainco REIT would remain a publicly traded company following the transaction and represented the overwhelming majority of the combined value of the Paired Entities.

Thereafter, the Paired Entities entered into confidentiality agreements (which did not contain standstill provisions) with each of Party A and Party B, and the Paired Entities shared certain confidential information and provided a term sheet regarding the potential terms of a transaction to each of Party A and Party B. The draft term sheet outlined terms for a long-term master management agreement and master franchise agreement, with proposed franchise, management, system and loyalty program fees payable by Remainco REIT, contemplated a five year performance guarantee to Remainco REIT of $654 million in system-wide property-level EBITDA for 2019 with annual adjustments thereafter (with rebates and adjustments to fees in order to offset any performance shortfall), a purchase price to be determined, and other terms, including covenants to assure Remainco REIT that, unless otherwise agreed by Remainco REIT, the Paired Entities’ management team would continue to manage the Extended Stay brand and portfolio, and areas of protection for Remainco REIT’s properties against new Extended Stay branded hotels or other extended stay franchises. The term sheet proposed that, after the initial five-year guarantee period, Remainco REIT would have rights to terminate the master agreements with respect to a specified number of hotels annually for failures to meet annual performance standards.

In late 2018 and early 2019, while the Paired Entities were engaged in discussions with Party A and Party B, the Paired Entities engaged in discussions with Blackstone regarding Blackstone’s potential interest in an acquisition of the Paired Entities. In connection with these discussions, the preexisting confidentiality/standstill agreement between Blackstone and the Paired Entities was amended to extend its duration, and Blackstone conducted due diligence on the Paired Entities. The other financial sponsor contacted by the Paired Entities’ financial advisor as part of this process did not express any interest in a transaction with the Paired Entities.

On December 11, 2018, a representative of Blackstone orally indicated to the Paired Entities that, were Blackstone to submit an acquisition proposal, it would be at a valuation below $20 per paired share, and that Blackstone would continue to conduct its due diligence review of the Paired Entities. Blackstone did not make a specific proposal to the Paired Entities at that time. On that date, the paired shares closed at a price of $17.15 per paired share.

In January 2019, while the Paired Entities continued discussions with Party A and Party B, at the direction of the Boards, the Paired Entities’ financial advisor continued to engage with Blackstone regarding its interest in a potential acquisition of the Paired Entities and to see if Blackstone would submit a specific proposal. In the course of these discussions, the Paired Entities’ financial advisor indicated that the Paired Entities were considering certain alternatives, and that before making a decision regarding those alternatives, the Paired Entities were interested in ascertaining whether Blackstone was prepared to make a specific proposal for an acquisition of the Paired Entities.

48

On January 18 and January 22, 2019, the Paired Entities received revised term sheets reflecting proposals from Party A and Party B. The proposal from Party A contemplated solely an acquisition of the Extended Stay brand for $150 million, with the Paired Entities retaining ownership of the management company, and with no minimum performance guarantees. The proposal from Party B contemplated an acquisition of the Extended Stay brand and management company for $500 million (which the Paired Entities estimated to have a value of approximately $2.00 per paired share after entity-level taxes) and, among other things, the payment by Remainco REIT to Party B of a franchise and system fee equal to 10% of revenue and a management fee equal to 1% of revenue. The proposal also provided for an annual performance guarantee to Remainco REIT of $630 million in system-wide property-level EBITDA, which would, however, be subject to an unspecified “ramp up period” for the initial performance guarantee level, and an annual and aggregate cap over the 5 year guarantee period of unspecified amounts. Party B’s proposal further indicated that the cash purchase price would be adjusted based upon the final form and structure of the performance guarantee. Other issues arising out of Party B’s proposal included that Party B rejected the inclusion of covenants proposed by the Paired Entities; whether Remainco REIT hotels would participate in Party B’s loyalty guest program and the terms of such participation; no specific proposal was made regarding the size of areas of protection for Remainco REIT’s properties against new Extended Stay branded hotels or other extended stay franchises; and the proposal did not address the rights of Remainco REIT following the initial 5 year guarantee period.

On January 25, 2019, a representative of Blackstone orally communicated to the Paired Entities’ financial advisor a proposal to acquire the Paired Entities at a price of $18.65 per paired share, indicating that Blackstone was not prepared to increase its price and that its proposal assumed the Paired Entities would pay no additional dividends on the paired shares. On the previous day, the paired shares closed at a price of $16.40 per paired share. Blackstone’s proposal represented a premium of 13.7% to the previous day’s closing price, a 15.7% premium to the 30-day VWAP of the paired shares, a 17.2% discount to the 52-week high closing price and a multiple of 10.9x NTM EBITDA. At that time, the Paired Entities owned approximately 567 hotels (which on average were 19.6 years old).

On January 28 and 29, 2019, representatives of the Paired Entities’ financial advisor met with representatives of each of Party A and Party B at an industry conference. The financial advisor conveyed to Party A that its proposal was not of interest to the Paired Entities because the price offered for the Extended Stay brand was inadequate, Party A was not prepared to assume the management of the Paired Entities’ hotels and was unwilling to provide performance guarantees. The financial advisor informed Party B that the Paired Entities were negotiating exclusively with Party B as a brand and management partner, but that this was not the only alternative being pursued by the Paired Entities.

In early February 2019, Party B submitted a revised written proposal in which it indicated that it was prepared to provide a five-year performance guarantee to Remainco REIT of $650 million in system-wide property-level EBITDA with no ramp-up period or annual adjustment, but with the guarantee payment to be paid by Party B for any shortfall capped at $60 million per year and at $180 million over the life of the guarantee. In addition, Party B proposed to have the right to recoup any guarantee payment over the following 20 years to the extent in any such year EBITDA exceeded $650 million. Under this proposal, Party B would be prepared to pay only $375 million for the Extended Stay brand and management company, rather than the $500 million it previously proposed. As an alternative, Party B indicated it would be prepared to pay $425 million for the Extended Stay brand and management company with a five-year performance guarantee of $650 million, but under this alternative the guarantee payment to be paid by Party B for any shortfall would be capped at $50 million per year and at $100 million over the life of the guarantee, but with the same 20 year recoupment term.

At meetings of the Boards of the Paired Entities on February 7 and 8, 2019, the Boards discussed Blackstone’s January 25, 2019 proposal and the status of discussions with Party B, including its revised proposal. At that meeting, the Boards determined to request a revised proposal from Blackstone. In mid-February 2019, a representative of Blackstone orally reaffirmed that the $18.65 per shared share price remained Blackstone’s best and final price. Thereafter, discussions with Blackstone terminated.

49

Discussions with Party B regarding a potential transaction continued between February and May 2019. During this period, Party B conducted additional diligence and refined its views regarding the potential transaction, including Party B’s capabilities to provide longer length of stay business consistent with the Paired Entities’ extended stay business model, the magnitude of scale-driven savings that would be expected to be available to Remainco REIT versus the various revenue-based fees and reimbursements that would be payable by Remainco REIT to Party B, and Party B’s views regarding the need to rebrand some of the then current Remainco REIT hotels to lower-tier Party B brands as a condition of a transaction, and the impact of that rebranding on the profitability of those hotels, which would still be owned by Remainco REIT.

In that connection, in mid-April 2019, Party B submitted a revised written proposal with three alternatives. Under the first alternative, Party B was prepared to pay $375 million for the Extended Stay brand and management company with no performance guarantee. Under the second and third alternatives, Party B was prepared to provide a five-year performance guarantee of system-wide property-level EBITDA ranging from $605 million in year one to $665 million in year five. Under the second alternative, it would pay $250 million for the Extended Stay brand and management company but its annual guarantee payment for any shortfall was to be capped at $60 million per year and at $180 million over the life of the guarantee. Under the third alternative, it would pay $300 million for the Extended Stay brand and management company but its guarantee payment for any shortfall was to be capped at $50 million per year and at $100 million over the life of the guarantee. No recoupment provision was included under any of the three alternatives.

On May 15, 2019, Party B delivered a revised written proposal to the Paired Entities, which Party B stated reflected its best and final proposal. Under this proposal, Party B would pay $300 million for the Extended Stay brand and management company with a five-year performance guarantee of system-wide property-level EBITDA ranging from $630 million in year one to $660 million in year five but its guarantee payment for any shortfall was to be capped at 2% of revenue per year (estimated to be approximately $25 million per year) and at $100 million over the life of the guarantee. No recoupment provision was included. In addition, Party B proposed to rebrand a significant number of Remainco REIT hotels to other brands, and added provisions that would commit Remainco REIT to additional capital expenditures following a transition period.

At a meeting of the Boards of the Paired Entities on May 19, 2019, the Boards reviewed the revised proposal from Party B. Also in attendance were representatives of the Paired Entities’ legal counsel and financial advisor. Following discussion, the Boards concluded that the proposal was not in the best interests of the holders of paired shares because it undervalued the Extended Stay brand and management company and presented material risks to the future performance and valuation of Remainco REIT. Accordingly, the Boards and determined not to move forward with Party B’s revised proposal and to cease discussions with Party B. The Boards determined that the Paired Entities should instead continue to move forward with the Paired Companies’ business plan and ESA 2.0 strategy.

On the Paired Entities’ August 7, 2019 earnings call, the Paired Entities’ President and Chief Executive Officer provided an update on the Boards’ evaluation of the Paired Entities’ corporate structure, stating that, after consideration of a variety of options, including discussions with potential transaction partners, the Boards had concluded that none of these options at that time provided superior stockholder value creation to the Paired Entities stand-alone prospects, but that the Boards remained open to actions in the future, including those that would involve a change in corporate structure. On that date, the paired shares closed at a price of $14.78 per paired share.

During the period from the July 26, 2018 earnings call to the August 7, 2019 earnings call, no party other than Blackstone made a proposal to the Paired Entities for an acquisition of the Company and no party other than Party A and Party B made a proposal to the Paired Entities for an acquisition of the Extended Stay brand or management company.

On November 21, 2019, the Paired Entities’ President and Chief Executive Officer resigned and was replaced by Bruce N. Haase, who is the current President and Chief Executive Officer of the Paired Entities. Prior to

50

becoming President and Chief Executive Officer, Mr. Haase had served as an independent director of Hospitality since April 2018.

On February 27, 2020, the Paired Entities held their earnings call for the fourth quarter of 2019. On this call, Mr. Haase identified four key pillars to the Paired Entities’ value creation strategy: improving the guest experience and property-level financial performance; more strategically curating and extracting value from the REIT assets through asset sales; growing the Extended Stay brand through an asset-light franchising strategy; and continuing to return significant capital to stockholders while maintaining a prudent balance sheet.

Commencing in the first quarter of 2020, the Paired Entities were impacted by the Covid-19 pandemic. Although all of the Paired Entities’ hotels remained open, the Paired Entities experienced declines in occupancy and revenues, while outperforming the broader lodging industry. On April 3, 2020, the paired shares closed at $6.43

On April 6, 2020, Starwood filed a Schedule 13D disclosing ownership of approximately 8.5% of the paired shares. In a call on that date, Barry Sternlicht of Starwood spoke to Doug Geoga, the Chairman of the Boards and an independent director of the Paired Entities. Mr. Sternlicht indicated that Starwood viewed the paired shares as undervalued, and that Starwood had no intention of pursuing any specific transaction with the Paired Entities at that time.

On June 1, 2020, the Paired Entities engaged Goldman Sachs & Co. LLC to serve as financial advisor to the Paired Entities to assist with their analysis and consideration of various financial or strategic alternatives that may be available to it. Goldman Sachs was engaged by the Paired Entities because of its substantial hospitality industry and mergers and acquisition experience.

On August 7, 2020, Starwood filed an amendment to its Schedule 13D disclosing ownership of approximately 9.4% of the paired shares.

Beginning in August 2020, Tarsadia Capital, an investment firm whom we refer to as Tarsadia, began to engage with management of the Paired Entities with respect to various investment ideas it wanted the Paired Entities to consider. Tarsadia indicated that it owned approximately 5 million paired shares. Over the following six months, multiple representatives of the Paired Entities, including Mr. Geoga, Mr. Haase, our Chief Financial Officer, and our Vice President of Investor Relations, engaged in more than 20 calls and meetings with representatives of Tarsadia. Management of the Paired Entities regularly briefed the Boards and the Boards discussed these matters with its financial and legal advisors.

Tarsadia’s representatives generally stated that they wished to be supportive of the Paired Companies and complimented the Paired Entities’ performance and management. Tarsadia’s ideas included: the potential to execute a transaction in which the Extended Stay brand and management company would be acquired by the Paired Entities’ management, leaving a public REIT; significantly increasing the Paired Entities’ leverage to conduct large-scale share repurchases; and partnering with another company, such as Starwood, to add their hospitality assets into Hospitality to leverage our management/brand capabilities. Under Tarsadia’s management buyout idea, the Company’s management would be both third party manager of the hotels and the remaining REIT’s management team. Management did not pursue Tarsadia’s management buyout proposal, as it viewed the proposal as giving rise to significant conflicts of interest for the Paired Entities’ management, in addition to requiring substantial third-party capital to fund any such transaction. Management also viewed the proposal as raising issues with respect to feasibility in light of the Paired Entities’ prior exploration of business separation transactions with Party A and Party B. Moreover, the Boards viewed this proposal as not being in stockholders’ best interests, in view of the fact that public REIT stockholders would not benefit from additional economies of scale or future sales of franchises; and that a substantial expansion of the EBITDA multiple of the remaining public REIT would be necessary in order for such a transaction to maximize value to the holders of paired shares — in this regard, the Boards believed, after discussions with representatives of Goldman Sachs, the Paired Entities’ financial advisor, that support for this multiple expansion was not persuasive. The Boards also believed

51

that significantly increasing the Paired Entities’ leverage as proposed by Tarsadia was not in the best interests of the Paired Entities’ stockholders.

On January 19, 2021, Tyler Henritze, a senior managing director at Blackstone, called Mr. Geoga to express Blackstone’s interest in a potential acquisition of the Paired Entities. Mr. Henritze stated that Blackstone had performed initial due diligence based on publicly-available information and that any offer price would be in the range of approximately “$17.00 plus” per paired share. Mr. Henritze also indicated to Mr. Geoga that Blackstone was considering working with Starwood but that no agreement or understanding between Blackstone and Starwood had been reached. Mr. Henritze noted that working with Starwood could result in a higher price for holders of paired shares. Mr. Geoga informed Mr. Henritze that he would confer with the Boards and management of the Paired Entities and the Paired Entities’ external advisors. On that date, the closing price of the paired shares was $15.47 per paired share. At that time, the Paired Entities owned approximately 563 hotels (which on average were 21.0 years old).

On January 20, 2021, Mr. Geoga advised the Boards regarding the outreach from Blackstone.

On January 22, 2021, Mr. Geoga called Mr. Henritze and indicated that the expression of interest in a potential acquisition of the Paired Entities would be considered by the Boards in due course.

On February 5, 2021, the Boards held a special meeting via videoconference. Also in attendance were David Clarkson, the Paired Entities’ Chief Financial Officer, and Christopher Dekle, the Paired Entities’ General Counsel, representatives of Fried Frank Harris Shriver & Jacobson LLP (whom we refer to as Fried Frank), the Paired Entities’ legal counsel, and representatives of Goldman Sachs, the Paired Entities’ financial advisor. Mr. Geoga provided an overview of the conversation with Blackstone on January 19, 2021. Representatives of Fried Frank provided an overview of the directors’ fiduciary duties in connection with the evaluation of a potential transaction and other relevant legal considerations. Representatives of Fried Frank also indicated that members of management should not, and the Boards instructed management not to, engage in any discussions with Blackstone regarding management’s role with the Paired Companies or compensation after completion of any transaction. Management agreed not to engage in such discussions.

At the February 5, 2021 meetings, representatives of Goldman Sachs reviewed and discussed with the Boards management’s preliminary projections for the Paired Entities for 2021 through 2025 reflecting management’s plan for the Paired Entities. Representatives of Goldman Sachs then reviewed and discussed with the Board certain preliminary financial analyses prepared by Goldman Sachs based on management’s projections, which were provided to Goldman Sachs for such purpose, reviewed the impact of potential revenue initiatives and potential asset sales by the Paired Entities, and reviewed general economic and industry developments and a range of strategic alternatives, including executing the Paired Entities’ business plan, executing the Paired Entities’ business plan with asset sales, pursuing alternatives for expanding the Paired Entities’ footprint, a split of the Paired Entities into independent management and property companies, and a sale of the Paired Entities as a whole.

As part of its review of management’s projections for the Paired Entities, the Boards discussed the assumptions underlying management’s projections. As part of this discussion, Mr. Haase indicated management’s view that the potential capital expenditure needs of the Paired Entities’ hotels could be materially greater than the capital expenditures allowances reflected in management’s projections over the duration of the five year projection period in light of the average age of the Paired Entities’ hotels of approximately 21 years, the average number of years between the last renovation and next planned renovation which will be approximately 10 years and the substantial wear and tear often associated with usage by extended stay guests. In addition, although the projected financial information assumed that property-level expenses per occupied room would increase approximately 3.0% annually, Mr. Haase noted to the Boards that expense increases could be materially greater (as they have been since 2017), and that each additional percentage point of annual expense increase over the projection period would result in an approximately $35 million reduction in annual adjusted EBITDA. The Boards discussed the foregoing risks to the management projections.

52

The Boards also discussed illustrative asset sale scenarios assuming the sale of hotels at different multiples of adjusted EBITDA and the potential benefits to the Paired Entities and their stockholders of such sales. One scenario involved the sale of 156 hotels from 2021 through 2023 (consisting of the sale of six hotels then under contract and which were expected to be sold in 2021 for $102 million and reflected in management’s projections, and the potential sale of 150 hotels and were not reflected in the management projections) at average multiples of 2019 adjusted EBITDA of 14.0x, 16.0x and 18.0x, resulting in illustrative total sale proceeds to the Paired Entities of approximately $1.6 billion, $1.9 billion and $2.1 billion, respectively, from 2021 to 2023, before taking into account expenses and other costs, including taxes. The Boards also considered a scenario where asset sales were completed from 2021 to 2023 at average multiples of 18.0x 2019 adjusted EBITDA, resulting in illustrative total sale proceeds to the Paired Entities of approximately $1.1 billion, before taking into account expenses and other costs, including taxes. Although the asset sales represented a potential upside scenario for stockholders, Mr. Haase indicated that, in management’s view, they should be considered in conjunction with the risks to management’s projections that the Board had discussed. No conclusions were reached at this meeting with respect to potential next steps, and the Boards determined to discuss the topic at their next regularly-scheduled board meetings several days later.

On February 8 and 9, 2021, the Boards of the Paired Entities held regularly-scheduled meetings via videoconference. On February 9, 2021, the Boards engaged in a further discussion of Blackstone’s recent proposal. Messrs. Clarkson and Dekle were in attendance, together with representatives of Fried Frank and Goldman Sachs. The Boards discussed potential next steps, including the advantages and disadvantages of permitting Blackstone and Starwood to work together to explore a potential transaction and potential related disclosure considerations. Following discussion, the Boards directed representatives of Goldman Sachs to communicate to Blackstone that the Paired Entities had no interest in a transaction at a price in the $17 per paired share range, but were prepared to share limited information with Blackstone under an appropriate confidentiality/standstill agreement, with a view to Blackstone making an improved proposal.

Later on February 9, 2021, representatives of Goldman Sachs conveyed the Boards’ view to a representative of Blackstone. On the same date, Fried Frank provided an initial draft of a confidentiality/standstill agreement to Simpson Thacher & Bartlett LLP (whom we refer to as Simpson Thacher), counsel to Blackstone. Representatives of Fried Frank and Simpson Thacher negotiated the terms of the confidentiality/standstill agreement, which was executed the following day and prohibited Blackstone from engaging in discussions or sharing information with any equity financing source, such as Starwood, without the consent of the Paired Entities.

On February 9, 2021, Blackstone submitted a due diligence list to the Paired Entities and, in response, management of the Paired Entities, with the assistance of Goldman Sachs, began to populate a virtual data room. On February 11, 2021, the Paired Entities granted Blackstone and its representatives access to the virtual data room.

On February 11, 2021, a representative of Starwood called a representative of Goldman Sachs to request that Starwood be given access to the Paired Entities’ non-public information. The representative of Goldman Sachs indicated that the Paired Entities were willing to share information with Starwood under an appropriate confidentiality/standstill agreement. On February 14, 2021, Fried Frank sent Starwood’s outside counsel, Kirkland & Ellis LLP, a form of confidentiality/standstill agreement. This agreement was substantially identical to the confidentiality/standstill agreement executed by Blackstone, and prohibited Starwood from engaging in discussions or sharing information with any equity financing source, such as Blackstone, without the consent of the Paired Entities. In addition, the draft agreement prohibited Starwood from making any public disclosure relating to a potential transaction without the consent of the Paired Entities. Neither Starwood nor its counsel indicated a willingness to enter into the confidentiality agreement at that time.

On February 12, 2021, Mr. Geoga spoke with representatives of Tarsadia. The Tarsadia representatives expressed the view that the Boards of the Paired Entities needed to communicate to the market a message of support for

53

management and its strategy, and that the Paired Entities were not for sale. The Tarsadia representatives urged the Paired Entities to ramp up the pace of asset dispositions as well as franchising and suggested that the Boards should add new directors with lodging and asset management experience. Mr. Geoga subsequently conveyed Tarsadia’s views to the Boards.

On February 16, 17 and 18, 2021, members of management of the Paired Entities and representatives of Goldman Sachs participated in due diligence meetings with representatives of Blackstone. In addition, on February 17, 2021, members of management of the Paired Entities provided a management presentation to representatives of Blackstone. Following this presentation, at the direction of the Paired Entities, representatives of Goldman Sachs furnished to Blackstone the Paired Entities’ management’s financial forecasts reflecting its business plan for the Paired Entities. These forecasts are summarized below under “Forward-Looking Financial Information.”

Also on February 17, 2021, Mr. Dekle received an inquiry from legal counsel to Tarsadia requesting a copy of the Paired Entities’ form of director questionnaire and written representation and agreement that are required to be furnished in connection with stockholder nominations of directors. These items were provided to Tarsadia and its counsel by Fried Frank on February 18, 2021.

On February 18, 2021, Mr. Henritze spoke by telephone to Mr. Geoga and to representatives of Goldman Sachs, and conveyed that Blackstone had completed a substantial amount of its due diligence and was prepared to increase its price to $17.75 per paired share. Representatives of Goldman Sachs advised Mr. Henritze that, based on their prior discussion with the Boards, a price of $17.75 per paired share would likely not be of interest to the Boards.

Later that day, Mr. Henritze again reached out to a representative of Goldman Sachs to indicate that Blackstone remained interested in a possible acquisition of the Paired Entities at an increased price of $18.00 per paired share. Blackstone asked for permission to speak to three financial institutions in connection with financing the proposed transaction, and Blackstone indicated that upon reaching a “handshake agreement” on price, Blackstone would be able to move quickly to sign a definitive agreement. The Goldman Sachs representative stated that Goldman Sachs would report this discussion to the Boards and management of the Paired Entities. On that date, the closing price of the paired shares was $15.28 per paired share.

On February 19, 2021, the Boards of the Paired Entities held a special meeting via videoconference. Messrs. Clarkson and Dekle were in attendance, together with representatives of Fried Frank and Goldman Sachs. Mr. Geoga provided an update regarding the recent outreach from Blackstone, and representatives of Goldman Sachs described Blackstone’s revised proposal of $18.00 per paired share and provided an update to Goldman Sachs’ preliminary financial analyses. Mr. Haase summarized his views concerning a potential transaction, stating that he believed a sale of the Paired Entities at the values that were likely achievable through further negotiations with Blackstone was a more favorable outcome for stockholders than continuing to pursue the Paired Entities’ standalone plan, taking into account risks associated with management’s business plan that had previously been discussed with the Boards and the benefits of potential asset sales. A discussion ensued, in the course of which individual directors expressed their views regarding a potential transaction. Following this discussion, the Boards directed representatives of Goldman Sachs to communicate to Blackstone that the Paired Entities had no interest in a transaction at a price at $18.00 per paired share, and that Blackstone would be permitted to discuss the potential acquisition with two debt financing sources in order to help facilitate a potential increase in Blackstone’s price.

On February 23, 2021, Tarsadia submitted to the Company a notice of its intent to nominate three candidates for election to the board of directors at the 2021 annual meeting of the Company. On February 24, 2021, Mr. Geoga notified the Boards of the Paired Entities of the receipt of this nomination notice and advised the directors that there would be a discussion of this notice at the next meetings of the Boards.

54

On February 25, 2021, after market close, the Paired Entities released their earnings for the fourth quarter of 2020 and the full fiscal year. The Paired Entities held an earnings call on February 26, 2021. On that date, the closing price of the paired shares was $16.09 per paired share.

On March 2, 2021, Blackstone submitted a letter to the Paired Entities contemplating the acquisition of the Paired Entities at an increased price of $18.75 per paired share, which the letter indicated represented a 30% premium to the trailing 30-day VWAP of the paired shares on January 19, 2021, the date of Blackstone’s initial indication, and a 22% premium to the trailing 30-day VWAP of the paired shares on March 1, 2021. The letter assumed that the Paired Entities would declare no additional dividends on the paired shares (other than the $0.09 dividend per paired share previously declared by the Boards) and was premised on Blackstone having the right to work with a co-investor, which Goldman Sachs’ representatives understood to refer to Starwood. In addition, the letter stated that Blackstone was prepared to complete its confirmatory due diligence and concurrently negotiate a definitive merger agreement within ten days. On that date, the closing price of the paired shares was $16.41 per paired share.

On March 2, 2021, Goldman Sachs provided the Paired Entities a letter describing Goldman Sachs’ relationships with Blackstone and Starwood over the prior two year period. This letter was subsequently provided to the Boards.

Also, on March 2, 2021, Mr. Dekle sent a letter to a representative of Tarsadia, indicating, among other things, that the Company intended to interview the Tarsadia board nominees in due course and would be reaching out to the nominees in the next few days. In e-mail and telephone exchanges with representatives of Tarsadia, Mr. Geoga confirmed the Company’s intent to interview the nominees. While the Company’s executive search firm did subsequently schedule these interviews, the Company cancelled the interviews following the announcement of the merger as a result of the Boards’ determination to postpone the annual meeting in order to focus on the merger transaction.

On March 3, 2021, the Boards of the Paired Entities held special meetings via videoconference. Messrs. Clarkson and Dekle were in attendance, together with representatives of Fried Frank and Goldman Sachs. Representatives of Goldman Sachs summarized Blackstone’s revised written proposal, discussed the recent movement in the trading price of the paired shares and recent changes to Wall Street analyst estimates for the Paired Entities, and provided an update to their preliminary financial analyses. Representatives of Fried Frank reviewed the directors’ fiduciary duties in evaluating Blackstone’s revised written proposal and discussed the key legal and contractual terms thereof, including Blackstone’s desire to work with Starwood. A discussion ensued and the meeting concluded without the Boards making any determination with respect to a response to the revised Blackstone proposal. The Boards agreed to schedule a follow up meeting as promptly as practicable.

On March 6, 2021, the Boards of the Paired Entities held special meetings via videoconference. Messrs. Clarkson and Dekle were in attendance, together with representatives of Fried Frank and Goldman Sachs. Mr. Geoga stated that the purpose of the meeting was to determine a response to the revised Blackstone proposal and encouraged each of the directors to provide his or her views. Representatives of Goldman Sachs provided an update on discussions with Blackstone, discussed Goldman Sachs’ preliminary financial analyses and outlined considerations relating to a potential response to Blackstone. In addition, representatives of Goldman Sachs discussed the potential level of debt financing to be used to fund the proposed transaction. Mr. Haase then presented his views on Blackstone’s most recent proposal. While acknowledging the progress made during his 15-month tenure as President and Chief Executive Officer and the potential for further progress, Mr. Haase indicated that, based on his best judgment of the Paired Entities’ business plan on a risk-adjusted basis, he would recommend that the Paired Entities transact with Blackstone, subject to the negotiation of Blackstone’s best and final offer. Mr. Haase noted that management had spent substantial time in recent years evaluating various potential value creation ideas for the Paired Entities, including the ideas conveyed by Tarsadia, and that these alternatives had been, and likely would continue to be, less favorable than the Paired Entities’ execution of their business plan. Mr. Haase discussed that, while he had not changed his views regarding the Paired Entities’

55

business plan and was optimistic regarding the potential for asset sales by the Paired Entities, the long-term capital needs of the business were a significant concern.

A majority of directors agreed with Mr. Haase’s views. A minority of directors were concerned that, given the recent rebound in stock prices in the hotel sector, potential for further recovery given the expected federal stimulus plan and increasing COVID-19 vaccinations, and the low interest rate environment, this was not the appropriate time to sell the Paired Entities, and that the premium offered by Blackstone was not compelling. After this discussion, it was the broad consensus of the Boards to make a counterproposal to Blackstone of $19.75 per paired share. In addition, the Boards directed representatives of Goldman Sachs to communicate the following points: the Paired Entities would agree to pay no dividends between signing and closing; a “ticking fee” of $0.001 per day should be payable if closing did not occur within four months of signing due to failure to complete the acquisition financing; the agreement should include a “go-shop” provision permitting the Paired Entities to solicit alternative proposals following signing of a definitive agreement and a two-tier termination fee, with a lower fee payable in the case of a termination to enter into an alternative transaction with a party making a proposal during the go-shop period; the right to specific performance of the buyer’s obligations under the agreement if debt financing is available; and a reverse termination fee of $350 million. The Boards instructed representatives of Goldman Sachs to communicate that the Boards would consider after the go-shop period whether to allow Blackstone to work with Starwood.

Later in the day on March 6, 2021, representatives of Goldman Sachs communicated this counterproposal orally to representatives of Blackstone and sent a written summary of the counterproposal to Blackstone.

On March 7, 2021, Blackstone communicated a revised proposal orally and in writing to representatives of Goldman Sachs. Blackstone’s revised proposal contemplated a purchase price of $19.25 per paired share, with a 30-day go-shop period (with a 1.5% of equity value go-shop termination fee and a 3% of equity value termination fee thereafter), a $300 million reverse termination (but no right to specific performance), and a ticking fee of $0.001 per day if closing were delayed beyond 135 days from signing. Blackstone indicated that its proposal was premised on Blackstone having the right to request that the Company pay a pre-closing dividend to purge its accumulated earnings and profits through the closing date of the transaction (which would offset the merger consideration on a dollar-for-dollar basis). Blackstone also indicated that its revised proposal was premised on Blackstone being able to bring Starwood in as its partner before signing of the definitive agreement. On March 5, 2021, the last trading day prior to Blackstone’s revised proposal, the paired shares closed at a price of $16.66 per paired share.

On March 7, 2021, the Boards of the Paired Entities held special meetings via videoconference. Messrs. Clarkson and Dekle were in attendance, together with representatives of Fried Frank and Goldman Sachs. Representatives of Goldman Sachs summarized the latest proposal from Blackstone and representatives of Fried Frank discussed the tax implications for holders of paired shares of Blackstone’s proposal for a “purging” dividend. Fried Frank and Goldman Sachs agreed to provide additional materials to the Boards regarding the proposed dividend, which materials were subsequently made available to the Boards. A discussion ensued during which individual directors expressed views that were largely consistent with the views they had expressed at the March 6, 2021 meeting. However, several directors expressed concern that the premium to the last closing price represented by Blackstone’s revised proposal was at the low end of precedent REIT merger transactions and below the 25^th percentile of premia paid in all industry transactions. Representatives of Goldman Sachs and the Boards further discussed the premium and representatives of Goldman Sachs expressed their view that the premia from precedent REIT merger transactions were likely more relevant to the Boards’ considerations than all-industries premia because, among other reasons, the Paired Entities, and particularly Hospitality, have substantial owned real estate exposure. Representatives of Goldman Sachs and the Boards also discussed that the premium represented by the proposed purchase compared favorably to the premium paid in other precedent REIT transactions when measured based on the 52-week high closing price and the 30-trading day volume-weighted average prices and that the proposed purchase price represented a significant premium to the paired shares’ trading price prior to the COVID-19 pandemic. Following this discussion, it was the broad consensus of the

56

Boards that representatives of Goldman Sachs should communicate to Blackstone that the Paired Entities would move forward to negotiate a merger agreement on the basis of Blackstone’s revised proposal, subject to (1) Blackstone understanding that the Paired Entities reserved the right to revisit the acquisition price depending upon upward price movement of the paired shares, (2) the go-shop termination fee being reduced to 1.25% of equity value, (3) confirmation of the tax impact of the proposed “purging” dividend and (4) Blackstone’s ability to partner with Starwood being conditioned upon Starwood’s signing of an acceptable confidentiality/standstill agreement. The Boards directed Fried Frank to provide a draft merger agreement to Simpson Thacher.

On the same day, representatives of Goldman Sachs communicated the Boards’ position to representatives of Blackstone. Later in the day on March 7, 2021, Fried Frank provided a draft merger agreement to Simpson Thacher.

On March 9, 2021, Simpson Thacher provided comments on the draft merger agreement to Fried Frank, which were consistent with Blackstone’s proposal, adjusted to reflect the reduced go-shop termination fee of approximately 1.25% of equity value proposed by the Paired Entities.

On March 10, 2021, the Paired Entities finalized a confidentiality/standstill agreement with Starwood and negotiated an amendment to the Blackstone confidentiality/standstill agreement, pursuant to which the Paired Entities permitted Blackstone to partner with Starwood in connection with a potential transaction. On March 10, 2021, the Paired Entities granted Starwood and its representatives access to the virtual data room.

From March 10, 2021 until the execution of the merger agreement, Blackstone and Starwood continued their due diligence review of the Paired Entities and the parties continued to negotiate the terms of the merger agreement and other transaction documents. These negotiations covered various aspects of the transaction, including, among other things: the representations and warranties to be made by the parties; the restrictions on the conduct of the Paired Entities’ business until completion of the transaction; the conditions to the completion of the mergers; the Paired Entities’ right to participate in discussions or negotiations with third parties relating to unsolicited acquisition proposals; the Paired Entities’ right to terminate the merger agreement; the remedies available to each party under the merger agreement, including the triggers for payment of the termination fees; the covenants regarding antitrust matters; the Paired Entities’ equity awards, employee benefit plans, severance and other compensation matters; and Parent’s right to delay the closing of the transaction in connection with obtaining certain foreign antitrust clearances.

On March 12, 2021, Simpson Thacher sent drafts of equity commitment letters and limited guarantees from Blackstone and Starwood to Fried Frank.

On March 12, 2021, the closing price of the paired shares was $16.94 per paired share. A meeting of the Boards of the Paired Entities was held via videoconference after the close of trading. Messrs. Clarkson and Dekle were in attendance, together with representatives of Fried Frank and Goldman Sachs. Representatives of Goldman Sachs provided an update on discussions with Blackstone and Starwood since the prior board meetings on March 7, 2021 and representatives of Fried Frank reviewed the status of the merger agreement. The directors discussed the fact that, as a result of the increase in the trading price of the paired shares, the premium to the last closing price represented by the proposed merger consideration of $19.25 per paired share was equal to approximately 13.6% and considered that premium primarily relative to the premia from precedent REIT merger transactions. Following discussion, it was the broad consensus of the Boards of the Paired Entities to communicate to Blackstone that, in light of the movement in the trading price of the paired shares, the Paired Entities were not prepared to move forward unless the merger consideration were increased to $19.50 per paired share. Representatives of Goldman Sachs conveyed this information to Blackstone that evening.

On March 13, 2021, representatives of Blackstone orally conveyed a revised proposal to representatives of Goldman Sachs. Blackstone and Starwood agreed to the Paired Entities’ request to increase the merger consideration to $19.50 per paired share in exchange for the elimination of the go-shop clause. Blackstone and

57

Starwood would retain the two-tiered termination fee structure, but increase the termination fee payable by the Paired Entities from approximately 1.25% to 2% of equity value in connection with the Paired Entities’ entry into an unsolicited alternative acquisition proposal received during the first 45 days following the execution of the merger agreement. Representatives of Blackstone communicated to representatives of Goldman Sachs that they were not willing to further raise their offer price. During further discussions on the same day between representatives of Blackstone and representatives of Goldman Sachs, Blackstone agreed to reduce the initial termination fee payable by the Paired Entities from 2.0% to 1.75% of equity value and that the reverse termination fee would be payable by Parent in certain circumstances involving antitrust matters. Thereafter, the parties continued to negotiate and exchange drafts of the merger agreement and other transaction documents.

On the afternoon of March 14, 2021, a meeting of the Boards of the Paired Entities was held via videoconference. Messrs. Clarkson and Dekle were in attendance, together with representatives of Fried Frank and Goldman Sachs. At that meeting, the Boards discussed the terms of the proposed engagement letter with Goldman Sachs relating to the proposed mergers. A representative of Fried Frank noted the relationships with Blackstone and Starwood that Goldman Sachs had previously disclosed to the Paired Entities. After discussion, the Boards approved the proposed engagement letter with Goldman Sachs. Representatives of Fried Frank then reviewed the directors’ fiduciary duties in connection with their evaluation of the potential transaction and also summarized the material terms of the merger agreement. Representatives of Goldman Sachs then presented their financial analyses of the mergers to the Boards, following which Goldman Sachs rendered an oral opinion to the effect that the proposed merger consideration of $19.50 per paired share to be paid pursuant to the proposed mergers was fair to the holders of paired shares (other than Blackstone, Starwood and their affiliates) from a financial point of view.

Mr. Geoga expressed his support for the proposed mergers and invited the other directors to express their views. Mr. Haase reiterated his support for the transaction and his comments at prior board meetings and articulated his belief that the proposed merger consideration provided certain and compelling value to holders of paired shares relative to the value potentially achievable under the Paired Entities’ business plan on a risk-adjusted basis. The Boards discussed Blackstone and Starwood’s elimination of the go-shop clause. It was noted that the Paired Entities had explored potential alternatives to maximize value on multiple occasions and, over that time period, no party other than Blackstone and Starwood has indicated an interest in a potential acquisition of the Paired Entities. It was also noted that, notwithstanding the elimination of the go-shop clause, the merger agreement would continue to provide a two-tiered termination fee structure, with a lower termination fee payable in connection with the termination of the merger agreement to enter into a more favorable transaction with a bidder making an unsolicited alternative acquisition proposal during an initial period following the execution of the merger agreement. In addition, representatives of Goldman Sachs expressed the view that there were unlikely to be other acquirers of the Paired Entities. The Boards concluded that increase the merger consideration to $19.50 per paired share in exchange for the elimination of the go-shop clause was in the best interest of the stockholders of the Paired Entities.

At the meeting, all of the members of the Company board communicated their support for the transaction. Two independent members of the Hospitality board, Neil Brown and Simon Turner, stated that they would dissent from the vote to approve the merger agreement. For a discussion of the reasons for the recommendation of the Boards of the Paired Entities in favor of the merger and the reasons of those directors who dissented from the vote, see “—Reasons for the Merger,” “—Recommendation of the Company Board,” and “—Recommendation of the Hospitality Board” below. A representative of Fried Frank then summarized a proposal to provide a “gross up” to members of management for taxes associated with change of control payments potentially triggered by the transaction under Sections 280G and 4999 of the Code. The representative of Fried Frank explained that, in exchange for the 280G “gross-up”, the members of management had agreed that the closing of the mergers and any changes or modifications to their authority, duties and/or responsibilities which arise solely as a result of the Paired Entities ceasing to be publicly-held companies would not, in and of itself, constitute a “material diminution in their authority, duties or responsibilities” (and, therefore, will not constitute good reason entitling them to terminate their employment with the Paired Entities and receive severance payments) under the

58

Company’s Executive Severance Plan. Mr. Haase confirmed that, aside from Fried Frank’s discussion with Simpson Thacher regarding the 280G “gross-up”, there had been no discussion between members of management and Blackstone or Starwood regarding their role with the Paired Companies or compensation after completion of the mergers.

Following these discussions, the Boards of the Paired Entities, by the unanimous vote of the Company directors and the affirmative vote of five of the seven directors of Hospitality (with Messrs. Brown and Turner dissenting), adopted resolutions declaring the merger agreement and the transactions contemplated by the merger agreement, including the mergers, to be advisable and in the best interests of the Paired Entities and the holders of paired shares, and determined to recommend the approval of the mergers and the other transactions contemplated by the merger agreement by stockholders. In addition, the Boards unanimously approved the “gross up” arrangements with management of the Paired Entities.

Following the meeting, the parties finalized and executed the merger agreement and other transaction documents during the evening of March 14, 2021. On March 15, 2021, the Paired Entities issued a press release announcing entry into the merger agreement.

Reasons for the Mergers

At the March 14, 2021 meeting of the Boards of the Paired Entities, the Boards adopted resolutions declaring the merger agreement and the transactions contemplated by the merger agreement, including the mergers, to be advisable and in the best interests of the Paired Entities and the holders of paired shares, and determined to recommend the approval of the mergers and the other transactions contemplated by the merger agreement to their respective stockholders.

In reaching their decisions, the Boards consulted with the Company’s senior management team, as well as the Paired Entities’ financial and legal advisors, and considered a number of factors, including the following factors which the Boards viewed as supporting their respective decisions to approve the merger agreement and the transactions contemplated by the merger agreement, including the mergers, and to recommend approval of the mergers and the other transactions contemplated by the merger agreement to their respective stockholders:

59

60

The Boards also considered the following potentially negative factors in their consideration of the merger agreement and the mergers:

61

62

The foregoing discussion of the factors considered by the Boards is not intended to be exhaustive. In reaching their respective decisions, the Boards did not quantify or assign any relative weights to, and did not make specific assessments of, the factors considered, and individual directors may have given different weights to different factors. Neither Board made any specific conclusion with respect to any of the factors or reasons considered. The above factors are not presented in any order of priority.

The explanation of the factors and reasoning set forth above contain forward-looking statements and should be read in conjunction with the section of this joint proxy statement entitled “Cautionary Statement Regarding Forward-Looking Statements.”

Recommendation of the Company Board

The Company board has unanimously approved the merger agreement and declared the merger agreement and the transactions contemplated by the merger agreement, including the mergers, to be advisable and in the best interests of the Company and its stockholders. The Company board recommends that you vote “FOR” the proposal to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement, “FOR” the proposal to approve, on a non-binding, advisory basis, the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the merger and “FOR” the proposal to approve any adjournment of the Company special meeting for the purpose of soliciting additional proxies if there are not sufficient votes at the Company special meeting to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement.

Recommendation of the Hospitality Board

The Hospitality board has approved the merger agreement and declared the merger agreement and the transactions contemplated by the merger agreement, including the mergers, to be advisable and in the best interests of Hospitality and its stockholders. The Hospitality board recommends that you vote “FOR” the proposal to adopt the merger agreement and approve the mergers and the other transactions contemplated by the merger agreement, and “FOR” the proposal to approve, on a non-binding, advisory basis, the compensation that may be paid or become payable to our named executive officers that is based on or otherwise relates to the merger.

fiscal year of certain expected financial results and operational metrics in our regular earnings press releases and other investor materials.

However, in connection with the evaluation of a possible transaction, our management prepared in February 2021 and provided to the Boards projections for the Paired Entities on a consolidated basis for 2021 through 2025 reflecting management’s business plan (the “projected financial information”), which are summarized below. The projected financial information was also provided to Goldman Sachs, and at the direction and with the approval of the Boards, Goldman Sachs relied on the plan projected financial information in performing its financial analyses for purposes of rendering its fairness opinion to the Boards. In addition, the projected financial information was provided to Blackstone and Starwood in connection with their evaluations of the transaction.

The projected financial information reflected the following key management assumptions:

64

The following table summarizes the projected financial information:

The projected financial information was not intended for public disclosure, and, accordingly, does not necessarily comply with published guidelines of the SEC, the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of financial forecasts or generally accepted accounting principles (GAAP). Neither our independent registered public accounting firm nor any other independent accountants have audited, compiled or performed any procedures with respect to the projected financial information or any assumptions underlying the projected financial information nor expressed an opinion or any form of assurance on the projected financial information or its achievability, and they assume no responsibility for, and disclaim any association with, such financial projections assumptions. The summary of the projected financial information is included in this joint proxy statement only because such information was made available to the Boards, Goldman Sachs, Blackstone and Starwood. The inclusion of the projected financial information in this joint proxy statement does not constitute an admission or representation by us that the information is material.

The projected financial information has been included only to reflect information made available to the Boards, Goldman Sachs, Blackstone and Starwood at the time of certain events and decisions and should not be relied upon as indicative of actual future results, and you are cautioned not to rely on the projected financial information or any assumptions underlying the projected financial information. Some or all of the assumptions

65

that have been made in connection with the preparation of the projected financial information may have changed since the date such information was prepared. None of the Company, Hospitality, Blackstone, Starwood nor any of our or their respective affiliates, advisors or other representatives assumes any responsibility for the validity, reasonableness, accuracy or completeness of the projected financial information. None of the Company, Hospitality, Blackstone, Starwood nor any of their respective affiliates has or intends to, and each of them disclaims any obligation to, update, revise or correct the projected financial information if any portion or all of such information has become or become inaccurate (even in the short term) since the time of its preparation. These considerations should be taken into account in reviewing the projected financial information, which was prepared as of an earlier date.

The projected financial information does not reflect changes in general business or economic conditions since the time it was prepared, changes in our businesses or prospects since the time it was prepared, or any other transaction or event that has occurred or that may occur and that was not anticipated at the time the projected financial information was prepared, and the projected financial information is not necessarily indicative of current values or future performance, which may be significantly more favorable or less favorable than as set forth above and should not be regarded as a representation that the projected financial information can or will be achieved. The projected financial information also reflects assumptions as to certain business decisions that are subject to change. In addition, our future financial performance may be affected by our ability to successfully implement a number of initiatives to improve our operations and financial performance and our ability to achieve strategic goals, objectives and targets over the applicable periods.

Because the projected financial information reflects subjective judgments in many respects, it is susceptible to multiple interpretations and continued revision based on actual experience and business developments. The projected financial information covers multiple years, and such information by its nature becomes less predictive with each succeeding year. The projected financial information constitutes forward-looking information and is subject to a wide variety of significant risks and uncertainties that could cause the actual results to differ materially from the projected results. For additional information on factors that may cause our future financial results to materially vary from the projected results summarized below, see the section entitled “Cautionary Statement Regarding Forward-Looking Statements,” beginning on page 28. Accordingly, there can be no assurance that the projected financial information will be realized or that actual results will not differ materially from the projected results, and the projected financial information cannot be considered a guarantee of future operating results and should not be relied upon as such. Neither the Paired Entities nor their affiliates or advisors or any other person has made any representation to any of our stockholders or any other person regarding our actual performance compared to the results included in the projected financial information. We have not made any representation to Blackstone, Starwood or their affiliates, in the merger agreement or otherwise, concerning the projected financial information.

The projected financial information should be evaluated in conjunction with the historical financial statements and other information contained in our public filings with the SEC. The projected financial information does not take into account any circumstances or events occurring after the date it was prepared, including the mergers. Further, the projected financial information does not take into account the effect of any failure of the mergers to be consummated and should not be viewed as accurate or continuing in that context.

We do not intend to update or otherwise revise the projected financial information to reflect circumstances existing after the date when it was prepared or to reflect the occurrence of future events, even in the event that any or all of the assumptions underlying the projected financial information are no longer appropriate.

Opinion of the Paired Entities’ Financial Advisor

Opinion of Goldman Sachs

Goldman Sachs rendered its opinion to the Company board and the Hospitality board that, as of March 14, 2021 and based upon and subject to the factors and assumptions set forth therein, the merger consideration to be paid

66

to the holders (other than Excluded Holders) of paired shares pursuant to the merger agreement was fair from a financial point of view to such holders.

The full text of the written opinion of Goldman Sachs, dated March 14, 2021, which sets forth assumptions made, procedures followed, matters considered and limitations on the review undertaken in connection with the opinion, is attached as Exhibit B and is incorporated into this joint proxy statement by reference in its entirety. Goldman Sachs provided advisory services and its opinion for the information and assistance of the Company board and the Hospitality board in connection with their consideration of the transactions contemplated by the merger agreement. The Goldman Sachs opinion is not a recommendation as to how any holder of paired shares should vote with respect to the mergers or any other matter.

In connection with rendering the opinion described above and performing its related financial analyses, Goldman Sachs reviewed, among other things:

Goldman Sachs also held discussions with members of the senior management of the Paired Entities regarding their assessment of the past and current business operations, financial condition and future prospects of their respective companies; reviewed the reported price and trading activity for the paired shares; compared certain financial and stock market information for the Paired Entities with similar information for certain other companies the securities of which are publicly traded; reviewed the financial terms of certain recent business combinations in the real estate investment trust (“REIT”) industry and in other industries; and performed such other studies and analyses, and considered such other factors, as it deemed appropriate.

For purposes of rendering its opinion, Goldman Sachs, with the Paired Entities’ consent, relied upon and assumed the accuracy and completeness of all of the financial, legal, regulatory, tax, accounting and other information provided to, discussed with or reviewed by it, without assuming any responsibility for independent verification thereof. In that regard, Goldman Sachs assumed with the Paired Entities’ consent that the Forecasts and the Additional Consideration Estimate were reasonably prepared on a basis reflecting the best currently available estimates and judgments of the management of the Paired Entities. Goldman Sachs did not make an independent evaluation or appraisal of the assets and liabilities (including any contingent, derivative or other off-balance-sheet assets and liabilities) of the Paired Entities or any of their respective subsidiaries and it was not furnished with any such evaluation or appraisal. Goldman Sachs assumed that all governmental, regulatory or other consents and approvals necessary for the consummation of the transactions contemplated by the merger agreement (the “proposed transaction”) will be obtained without any adverse effect on the expected benefits of the proposed transaction in any way meaningful to its analysis. Goldman Sachs has also assumed that the proposed transaction will be consummated on the terms set forth in the merger agreement, without the waiver or modification of any term or condition the effect of which would be in any way meaningful to its analysis.

67

Goldman Sachs’ opinion does not address the underlying business decision of the Paired Entities to engage in the transaction or the relative merits of the transaction as compared to any strategic alternatives that may be available to the Paired Entities; nor does it address any legal, regulatory, tax or accounting matters. Goldman Sachs was not requested to solicit, and did not solicit, interest from other parties with respect to an acquisition of, or other business combination with, the Paired Entities or any other alternative transaction. Goldman Sachs’ opinion addresses only the fairness from a financial point of view to the holders (other than Excluded Holders) of paired shares, as of the date of the opinion, of the merger consideration to be paid to such holders pursuant to the merger agreement. Goldman Sachs’ opinion does not express any view on, and does not address, any other term or aspect of the merger agreement or the proposed transaction or any term or aspect of any other agreement or instrument contemplated by the merger agreement or entered into or amended in connection with the proposed transaction, including any allocation of the merger consideration, including among the holders of paired shares, the fairness of the proposed transaction to, or any consideration received in connection therewith by, the holders of any other class of securities, creditors, or other constituencies of the Paired Entities; nor as to the fairness of the amount or nature of any compensation to be paid or payable to any of the officers, directors or employees of the Paired Entities, or class of such persons in connection with the proposed transaction, whether relative to the merger consideration to be paid to the holders (other than Excluded Holders) of paired shares pursuant to the merger agreement or otherwise. Goldman Sachs’ opinion does not express any opinion as to the potential effects of volatility in the credit, financial and stock markets on Parent, the Paired Entities or the proposed transaction, or as to the impact of proposed transaction on the solvency or viability of the Paired Entities or Parent or the ability of the Paired Entities or Parent to pay their respective obligations when they come due. Goldman Sachs’ opinion was necessarily based on economic, monetary, market and other conditions as in effect on, and the information made available to it as of, the date of the opinion and Goldman Sachs assumed no responsibility for updating, revising or reaffirming its opinion based on circumstances, developments or events occurring after the date of its opinion. Goldman Sachs’ advisory services and its opinion were provided for the information and assistance of the Company board and the Hospitality board in connection with their consideration of the proposed transaction and such opinion does not constitute a recommendation as to how any holder of paired shares should vote with respect to the proposed transaction, or any other matter. Goldman Sachs’ opinion was approved by a fairness committee of Goldman Sachs.

Summary of Material Financial Analyses

The following is a summary of the material financial analyses delivered by Goldman Sachs to the Company board and the Hospitality board in connection with rendering the opinion described above. The following summary, however, does not purport to be a complete description of the financial analyses performed by Goldman Sachs, nor does the order of analyses described represent relative importance or weight given to those analyses by Goldman Sachs. Some of the summaries of the financial analyses include information presented in tabular format. The tables must be read together with the full text of each summary and are alone not a complete description of Goldman Sachs’ financial analyses. Except as otherwise noted, the following quantitative information, to the extent that it is based on market data, is based on market data as it existed on or before March 12, 2021, the last trading day before the public announcement of the mergers, and is not necessarily indicative of current market conditions.

Illustrative Premia and Multiples. Goldman Sachs calculated the implied premia represented by the merger consideration of $19.50 per paired share relative to:

68

The results of these calculations and comparisons are as follows:

Using the foregoing, Goldman Sachs calculated the following multiples:

The results of these calculations and comparisons are as follows:

69

Goldman Sachs also calculated the one year forward EBITDA multiples for the Paired Entities for the periods shown below (the “historical NTM EBITDA multiples”):

Illustrative Present Value of Future Share Price Analysis.    Goldman Sachs performed an illustrative analysis of the implied present value of an illustrative future value per paired share, including the present value of accumulated dividends, which is designed to provide an indication of the present value of a theoretical future value of a company’s equity as a function of such company’s financial multiples and the dividends per share forecasted to be paid through each year. For this analysis, Goldman Sachs first used the Forecasts to calculate the illustrative implied enterprise value of the Paired Entities as of year-end for each of the calendar years 2021 to 2024, by multiplying the one-year forward EBITDA as of such date (using the Forecasts) by an illustrative range of multiples of 9.0x to 11.0x. These illustrative multiple estimates were derived by Goldman Sachs utilizing its professional judgment and experience, taking into account current and historical trading data for the Paired Entities and one year forward EBITDA multiples for the Paired Entities, including the historical NTM EBITDA multiples. To derive year-end illustrative implied equity values for each of the calendar years 2021 to 2024, Goldman Sachs then subtracted the amount of the Paired Entities’ projected net debt as of December 31, 2021, 2022, 2023 and 2024, respectively, as provided in the Forecasts (subject to an adjustment for the Paired Entities’ restricted cash of $13.2 million as of December 31, 2020, as provided by the Paired Entities’ management and as approved for Goldman Sachs’ use by the Paired Entities), from the range of year-end illustrative implied enterprise values. To convert the year-end illustrative implied equity values into illustrative implied equity values per paired share, Goldman Sachs then divided the year-end illustrative implied equity values by the number of fully diluted paired shares as of December 31 of each such year (as provided by the Paired Entities’ management and as approved for Goldman Sachs’ use by the Paired Entities). Goldman Sachs then discounted the 2021, 2022, 2023 and 2024 year-end illustrative implied per paired share equity values back one, two, three and four years, respectively, to December 31, 2020, using an illustrative discount rate of 9.56%, reflecting an estimate of the Paired Entities’ cost of equity. Goldman Sachs derived such discount rate by application of the Capital Asset Pricing Model, which requires certain company-specific inputs, including a beta for the company, as well as certain financial metrics for the United States financial markets generally. Goldman Sachs then added to such discounted value the present value of the projected dividends per paired share (as provided by the Paired Entities’ management and approved for Goldman Sachs’ use by the Paired Entities) for the years 2021 (including declared dividends in 2021), 2022, 2023 and 2024 obtained by discounting such projected dividends (using a mid-year payment convention) back to December 31, 2020 using an illustrative discount rate of 9.56%, reflecting an estimate of the Paired Entities’ cost of equity, as discussed above, to obtain the implied present value of an illustrative future value per paired share, including the present value of accumulated dividends. This analysis resulted in a range of implied present values of $12.62 to $21.48 per paired share.

Illustrative Discounted Cash Flow Analysis. Using the Forecasts, Goldman Sachs performed an illustrative discounted cash flow analysis on the Paired Entities. Using discount rates ranging from 7.00% to 8.00%, reflecting estimates of the Paired Entities’ weighted average cost of capital, Goldman Sachs discounted to present value as of December 31, 2020 (i) estimates of unlevered free cash flow for the Paired Entities for the years 2021 through 2025 as reflected in the Forecasts and (ii) a range of illustrative terminal values for the Paired Entities, which were calculated by applying perpetuity growth rates ranging from 1.00% to 1.50% to a terminal year estimate of the free cash flow to be generated by the Paired Entities, as reflected in the Forecasts (which analysis implied exit terminal year EBITDA multiples ranging from 8.4x to 10.8x). Goldman Sachs derived such discount rates by application of the Capital Asset Pricing Model, which requires certain company-specific inputs,

70

including the Paired Entities’ target capital structure weightings, the cost of long-term debt, after-tax yield on permanent excess cash, if any, future applicable marginal cash tax rate and a beta for the Paired Entities, as well as certain financial metrics for the United States financial markets generally. The range of perpetuity growth rates was estimated by Goldman Sachs utilizing its professional judgment and experience, taking into account the Forecasts and market expectations regarding long-term real growth of gross domestic product and inflation. Goldman Sachs derived ranges of illustrative enterprise values for the Paired Entities by adding the ranges of present values it derived above. Goldman Sachs then subtracted net debt from the range of illustrative enterprise values it derived for the Paired Entities, as provided by the management of the Paired Entities, to derive a range of illustrative equity values for the Paired Entities. Goldman Sachs then divided the range of illustrative equity values it derived by the number of fully diluted outstanding shares of the Paired Entities as of March 14, 2021, as provided by the management of the Paired Entities, to derive a range of illustrative present values per share ranging from $15.26 to $22.47.

Premia Analysis. Goldman Sachs reviewed and analyzed, using publicly available information, the acquisition premia for completed (with the exception of the Front Yard and Taubman Centers transactions described below) all-cash acquisition transactions announced during the time period from 2013 through 2020 involving a publicly traded company in the REIT industry based in the United States as the target (the “REIT premia analysis”). This REIT premia analysis included the announced acquisition of Front Yard Residential Corporation (“Front Yard”) by Amherst Residential LLC and the initial offer for the acquisition of Taubman Centers, Inc. (“Taubman Centers”) by Simon Property Group, Inc. Both of these transactions were announced prior to the COVID pandemic but not completed, and subsequently, after the onset of the pandemic, new transactions involving the same target entities were announced and completed. Goldman Sachs, utilizing its professional judgement and experience, determined that with respect to Front Yard and Taubman Centers it was appropriate to include in the REIT premia analysis both the initial announced but uncompleted transactions and the subsequent completed transactions to provide additional points of reference for the Hospitality board and the Company board. The REIT premia analysis also excluded the acquisition of Quality Care Properties by Welltower Inc. due to circumstances surrounding the trading of the target’s shares prior to announcement that caused Goldman Sachs, utilizing its professional judgment and experience, to determine that such transaction was not appropriate to include. In total, twenty-three transactions were included in the REIT premia analysis.

For the entire period, using publicly available information, Goldman Sachs calculated the mean, median, 25th percentile and 75th percentile premiums of the price paid in the identified transactions relative to (i) the target’s last undisturbed closing stock price prior to announcement of the transaction, (ii) the highest trading price for the target’s shares over the 52-week period ending on the date of the target’s last undisturbed closing share price and (iii) the 30-trading day VWAP of the target’s shares prior to the date of the target’s last undisturbed closing share price. The results of this analysis are presented in the table above as compared to the applicable metric for the paired shares in the proposed transaction. Using this analysis, Goldman Sachs applied a reference range of illustrative premiums of 13.9% to 25.2% to the undisturbed closing price per paired share of $16.94 as of March 12, 2021 and calculated a range of implied equity values per paired share of $19.29 to $21.21.

Goldman Sachs also reviewed and analyzed, using publicly available information, the acquisition premia for completed all-cash acquisition transactions involving a U.S. public company as the target, regardless of industry, announced during the time period from 2015 through 2020, where the disclosed enterprise values for the

71

transaction were between $1 billion and $10 billion (the “all industries premia analysis”). The all industries premia analysis excluded the acquisition of Quality Care Properties by Welltower Inc. (for the reasons discussed above), the acquisition of Tobira Therapeutics, Inc. by Allergan plc, a research and development-focused acquisition in the pharmaceuticals industry with a significant amount of contingent consideration, due to the nature of the transaction, which caused Goldman Sachs, utilizing its professional judgment and experience, to determine that such transaction was not appropriate to include, and the acquisition of La Quinta Holdings, Inc. by Wyndham Worldwide Corporation due the nature of the transaction making an accurate and representative premium difficult to obtain, which caused Goldman Sachs, utilizing its professional judgment and experience, to determine that such transaction was not appropriate to include.

For the entire period, using publicly available information, Goldman Sachs calculated the mean, median, 25th percentile and 75th percentile premiums of the price paid in the identified transactions relative to (i) the target’s last undisturbed closing stock price prior to announcement of the transaction, (ii) the highest trading price for the target’s shares over the 52-week period ending on the date of the target’s last undisturbed closing share price and (iii) the 30-day average price of the target’s shares prior to the date of the target’s last undisturbed closing share price. The results of this analysis are presented in the table above. Using this analysis, Goldman Sachs applied a reference range of illustrative premiums of 16.6% to 50.4% to the undisturbed closing price per paired share of $16.94 as of March 12, 2021 and calculated a range of implied equity values per paired share of $19.76 to $25.47.

The preparation of a fairness opinion is a complex process and is not necessarily susceptible to partial analysis or summary description. Selecting portions of the analyses or of the summary set forth above, without considering the analyses as a whole, could create an incomplete view of the processes underlying Goldman Sachs’ opinion. In arriving at its fairness determination, Goldman Sachs considered the results of all of its analyses and did not attribute any particular weight to any factor or analysis considered by it. Rather, Goldman Sachs made its determination as to fairness on the basis of its experience and professional judgment after considering the results of all of its analyses. No company or transaction used in the above analyses as a comparison is directly comparable to the Paired Entities or Parent or the contemplated transaction.

Goldman Sachs prepared these analyses for purposes of Goldman Sachs’ providing its opinion to Company board and the Hospitality board as to the fairness from a financial point of view to the holders (other than Excluded Holders) of paired shares, as of the date of the opinion, of the merger consideration to be paid to such holders pursuant to the merger agreement. These analyses do not purport to be appraisals nor do they necessarily reflect the prices at which businesses or securities actually may be sold. Analyses based upon forecasts of future results are not necessarily indicative of actual future results, which may be significantly more or less favorable than suggested by these analyses. Because these analyses are inherently subject to uncertainty, being based upon numerous factors or events beyond the control of the parties or their respective advisors, none of the Paired Entities, Parent, Goldman Sachs or any other person assumes responsibility if future results are materially different from those forecast.

The merger consideration was determined through arm’s-length negotiations between the Paired Entities and Parent and was approved by the Company board and the Hospitality board. Goldman Sachs provided advice to the Paired Entities during these negotiations. Goldman Sachs did not, however, recommend any specific amount of consideration to the Paired Entities, the Company board or the Hospitality board or that any specific amount of consideration constituted the only appropriate consideration for the mergers.

72

As described above, Goldman Sachs’ opinion to the Company board and the Hospitality board was one of many factors taken into consideration by the Company board and the Hospitality board in making their determination to approve the merger agreement. The foregoing summary does not purport to be a complete description of the analyses performed by Goldman Sachs in connection with the fairness opinion and is qualified in its entirety by reference to the written opinion of Goldman Sachs attached as Exhibit B.

Goldman Sachs and its affiliates are engaged in advisory, underwriting and financing, principal investing, sales and trading, research, investment management and other financial and non-financial activities and services for various persons and entities. Goldman Sachs and its affiliates and employees, and funds or other entities they manage or in which they invest or have other economic interests or with which they co-invest, may at any time purchase, sell, hold or vote long or short positions and investments in securities, derivatives, loans, commodities, currencies, credit default swaps and other financial instruments of the Paired Entities, Parent, any of their respective affiliates and third parties, including The Blackstone Group Inc. and Starwood Capital Group, each of which are affiliates of Parent, and their respective affiliates and portfolio companies, or any currency or commodity that may be involved in the transactions contemplated by the merger agreement. Goldman Sachs acted as financial advisor to the Paired Entities in connection with, and participated in certain of the negotiations leading to, the transactions contemplated by the merger agreement. During the two year period ended March 14, 2021, the Investment Banking Division of Goldman Sachs has not been engaged by the Paired Entities or their affiliates, except as described below, to provide financial advisory or underwriting services for which Goldman Sachs has recognized compensation. Goldman Sachs also has provided certain financial advisory and/or underwriting services to The Blackstone Group Inc. and its affiliates and portfolio companies from time to time for which the Investment Banking Division of Goldman Sachs has received, and may receive, compensation, including having acted as left lead bookrunner with respect to a term loan repricing and add on (aggregate principal amount €1,220,000,000) by BME Group Holding BV, a portfolio company of funds associated with Blackstone, in March 2021; as financial advisor to Change Healthcare Inc., a portfolio company of funds associated with Blackstone, with respect to its pending sale to UnitedHealth Group announced in January 2021; as financial advisor to a consortium of Blackstone Infrastructure Partners, an affiliate of Blackstone, and B&J Holdings Limited with respect to the consortium’s recommended offer to acquire Applegreen plc announced in December 2020; as financial advisor to BioMed Realty Trust Inc., a portfolio company of funds associated with Blackstone, with respect to its recapitalization into a new fund affiliated with Blackstone in November 2020; as financial advisor to Rothesay Life plc, a portfolio company of funds associated with Blackstone, with respect to the sale of Blackstone’s equity interest in October 2020; as financial advisor to Blackstone Group LP, an affiliate of Blackstone, with respect to its investment in Cryoport, Inc. in October 2020; as a joint bookrunner with respect to a follow-on public offering of the equity of TradeWeb LLC, a portfolio company of funds associated with Blackstone in April 2020; as a bookrunner with respect to the term loan B facility (aggregate principal amount $1,800,000,000) and the 4.75% secured notes due 2027 (aggregate principal amount $375,000,000) issued by the Michaels Companies, Inc., a portfolio company of funds associated with Blackstone, in September 2020; as lead arranger with respect to the floating rate securitization (aggregate principal amount $630,000,000) entered into by Blackstone Real Estate Advisors, an affiliate of Blackstone, in August 2020; as left lead bookrunner with respect to a public offering of 4.25% Notes due 2026 (aggregate principal amount $750,000,000) by Blue Yonder Group, Inc., a portfolio company of funds associated with Blackstone, in July 2020; and as lead arranger for London Stock Exchange Group plc, a portfolio company of funds associated with Blackstone, with respect to its bridge financing completed in November 2019. During the two year period ended March 14, 2021, Goldman Sachs has recognized compensation for financial advisory and/or underwriting services provided by its Investment Banking Division to The Blackstone Group Inc. and/or its affiliates and portfolio companies of approximately $202.5 million as determined by Goldman Sachs based on its books and records. Goldman Sachs also has provided certain financial advisory and/or underwriting services to Starwood Capital Group and its affiliates and portfolio companies from time to time for which the Investment Banking Division of Goldman Sachs has received, and may receive, compensation, including having acted as financial advisor to SOF-11 Klimt CAI S.à r.l., Luxembourg, a portfolio company of funds associated with Starwood, with respect to its take private of CA Immobilien Anlagen AG announced in January 2021; as a bookrunner with respect to the term loan B facility (aggregate principal amount $250,000,000) entered into by Starwood Property Mortgage LLC, an

73

affiliate of Starwood, in September 2020; as a bookrunner with respect to the 5.50% unsecured notes due 2023 (aggregate principal amount $300,000,000) issued by Starwood Property Trust, Inc., an affiliate of Starwood, in October 2020; and as a bookrunner with respect to the term loan B facility (aggregate principal amount $400,000,000) entered into by Starwood Property Trust, Inc., an affiliate of Starwood, in July 2019. During the two year period ended March 14, 2021, Goldman Sachs has recognized compensation for financial advisory and/or underwriting services provided by its Investment Banking Division to Starwood Capital Group and/or its affiliates and portfolio companies of approximately $3.75 million as determined by Goldman Sachs based on its books and records. Goldman Sachs may also in the future provide financial advisory and/or underwriting services to the Paired Entities, Parent, The Blackstone Group Inc., Starwood Capital Group and their respective affiliates and, as applicable, portfolio companies for which the Investment Banking Division of Goldman Sachs may receive compensation. Affiliates of Goldman Sachs also may have co-invested with The Blackstone Group Inc. and/or Starwood Capital Group and their respective affiliates from time to time and may have invested in limited partnership units of affiliates of The Blackstone Group Inc. and/or Starwood Capital Group from time to time and may do so in the future.

The Company board and the Hospitality board selected Goldman Sachs as its financial advisor because it is an internationally recognized investment banking firm that has substantial experience in transactions similar to the merger. Pursuant to a letter agreement dated March 14, 2021, the Paired Entities engaged Goldman Sachs to act as its financial advisor in connection with the mergers. The engagement letter between the Paired Entities and Goldman Sachs provides for a transaction fee that is estimated, based on the information available as of the date of announcement, at approximately $30,000,000, $3,000,000 of which became payable at announcement of the mergers, and the remainder of which is contingent upon consummation of the mergers. In addition, the Paired Entities have agreed to reimburse Goldman Sachs for certain of its expenses, including attorneys’ fees and disbursements, and to indemnify Goldman Sachs and related persons against various liabilities, including certain liabilities under the federal securities laws.

Financing

In connection with the closing, Parent will cause an aggregate of approximately $3.5 billion to be paid to the holders of Company common stock, Hospitality class B common stock and stock units. In addition, Parent has informed us that Parent expects to cause all of our outstanding unsecured senior notes and term loans and all of outstanding indebtedness under our revolving credit facilities to be prepaid in full in connection with the closing. As of December 31, 2020, we had approximately $2.7 billion in aggregate principal amount of consolidated indebtedness under our unsecured senior notes, term loans and revolving credit facilities.

Parent has informed us that it has received a debt commitment letter from JPMorgan Chase Bank, National Association, Citigroup Global Markets Inc. and Deutsche Bank AG, New York Branch providing for debt financing in connection with the mergers in an aggregate amount not to exceed $4.5 billion and that it may seek to obtain additional debt financing in connection with the mergers. In addition, it is expected that the Blackstone Sponsor and the Starwood Sponsor and/or their respective affiliates will contribute equity to Parent or its permitted assigns for the purpose of funding the acquisition costs (including the merger consideration) that are not covered by such debt financing. In connection with such equity contribution, the Blackstone Sponsor has delivered a commitment letter to Parent under which, subject to the terms and conditions thereof, the Blackstone Sponsor committed to cause Parent or its permitted assigns to be capitalized with cash for the purpose of funding 50% of the merger consideration pursuant to the merger agreement plus related costs and expenses, less 50% of the net proceeds of the debt financing (subject to applicable reserve requirements). Similarly, the Starwood Sponsor and the Starwood Rollover Investor have delivered a separate commitment letter to Parent under which, subject to the terms and conditions thereof (1) the Starwood Rollover Investor agreed to contribute all of its rollover shares to Parent or its permitted assigns immediately prior to the effective time and (2) the Starwood Sponsor committed to cause Parent or its permitted assigns to be capitalized with cash for the purpose of funding 50% of the merger consideration pursuant to the merger agreement plus related costs and expenses, less 50% of the net proceeds of the debt financing (subject to applicable reserve requirements), and less an amount equal to

74

the number of rollover shares contributed by the Starwood Rollover Investor multiplied by the merger consideration.

Parent has informed us that in addition to the payment of the merger consideration, the funds to be obtained from the debt and equity financing may be used for purposes such as reserves, carrying costs with respect to the properties, working capital requirements of the properties, and for other costs and expenses related to the financing and the mergers. Parent has informed us that it currently believes that the funds to be borrowed under each debt financing would be secured by, among other things, a first priority mortgage lien on certain properties which are wholly owned by us, escrows, reserves, a cash management account, or a first priority pledge of and security interest in the direct or indirect ownership interests in the owners of the proper-ties and the operating lessee, in each case, together with such other pledges and security required by the lender to secure and perfect their interest in the applicable collateral and that such debt financings would be conditioned on the mergers being completed and other customary conditions for similar financings.

The merger agreement does not contain a financing condition or a “market MAC” condition to the closing. For more information, see “The Merger Agreement—Financing Cooperation” and “The Merger Agreement—Conditions to the Mergers.”

Interests of the Company’s and Hospitality’s Directors and Executive Officers in the Mergers

Company stockholders and Hospitality stockholders should be aware that the directors and executive officers of the Company and Hospitality have interests in the mergers that may be different from, or in addition to, the interests of the holders of the paired shares generally, including the treatment of their equity awards in connection with the transaction, certain potential severance payments, and the right to continued indemnification and insurance coverage. This disclosure assumes that the mergers will constitute a change in control, change of control or term of similar meaning under all of our compensation plans, programs, and agreements. For purposes of this disclosure, our “executive officers” are: (1) Bruce N. Haase, President and Chief Executive Officer; (2) David Clarkson, Chief Financial Officer; (3) Kevin A. Henry, Executive Vice President and Chief Human Resource Officer; (4) Christopher N. Dekle, General Counsel and Corporate Secretary; (5) Howard J. Weissman, Corporate Controller and Chief Accounting Officer; (6) Randolph H. Fox, Executive Vice President, Property Operations; (7) Kelly Poling, Executive Vice President, Chief Commercial Officer; (8) Michael L. Kuenne, Senior Vice President, Chief Customer Experience Officer; (9) Nancy K. Templeton, Senior Vice President, Chief Information Officer; and (10) Judi Bikulege, Chief Investment Officer.

Arrangements with Parent

As of the date of this joint proxy statement, none of our executive officers has entered into any agreement with Parent or any of its affiliates regarding employment with, or the right to purchase or participate in the equity of, Parent or any of its affiliates.

Treatment of the Company and Hospitality Equity Awards

The Company and Hospitality have from time to time granted stock units under the Amended and Restated Extended Stay America, Inc. Long-Term Incentive Plan, adopted as of April 10, 2015, and the Amended and Restated ESH Hospitality, Inc. Long-Term Incentive Plan, adopted as of April 10, 2015, respectively (collectively referred to in this joint proxy statement as the “equity incentive plans”).

The merger agreement provides for the following treatment with respect to stock unit awards held by the Company’s and Hospitality’s directors, executive officers, and all other participants in the equity incentive plans as of immediately prior to the effective time. Each then-outstanding stock unit (whether vested or unvested), except for the then-unvested stock units held by Mr. Haase in respect of his base compensation stock unit awards (which will be canceled for no consideration therefor, in accordance with their terms), will automatically and

75

without any action on the part of the holder thereof, be canceled and converted into, and the holder thereof will be entitled to receive, without interest, a lump sum cash payment equal to the sum of (1) the product obtained by multiplying (i) the total number of paired shares issuable in respect of such stock unit immediately prior to the effective time (assuming that in respect of each stock unit subject to performance-vesting conditions, performance was achieved at the greater of (x) the actual level of achievement as of the closing date for each then-in-process performance period measured against the applicable performance goal, pro-rated through the closing date and (y) the “target” level of achievement) by (ii) the merger consideration and (2) the amount of all dividend equivalents payable pursuant to the applicable award agreement in respect of each paired share issuable in respect of such stock unit, which have accrued and are unpaid as of immediately prior to the effective time (including the special dividend ) that would otherwise become payable at the time of the stock unit’s settlement, subject to any applicable tax withholding.

Summary of Outstanding Shares of Common Stock and Equity Awards Held by the Company’s and Hospitality’s Directors and Executive Officers

The following table sets forth the estimated cash consideration that each of the Company’s and Hospitality’s directors and executive officers would be entitled to receive in respect of any outstanding paired shares and any outstanding stock units held by the executive officer or director as of the date of this joint proxy statement. The values shown were calculated based on the merger consideration per paired share of $19.50 (without reduction for the special dividend), and assuming (i) for the stock unit awards subject to performance-vesting conditions, performance is achieved at (x) 150% of target for the performance-based stock unit awards with a performance period that commences in 2019 and 2020 and (y) 200% of target for the performance-based stock unit awards with a performance period that commences in 2021, (ii) all accrued and unpaid dividend equivalents will be paid, (iii) no additional equity-based awards will be granted to any executive officers between the date of the merger agreement and the effective time and (iv) no stock unit awards are forfeited prior to the effective time, other than the 149,998 stock units held by Mr. Haase in respect of his base compensation stock unit awards, which represents the number of then-unvested base compensation award stock units that would be forfeited by Mr. Haase as of the effective time in accordance with their terms, assuming that the effective time occurs on July 1, 2021. Such stock units that will be forfeited by Mr. Haase are excluded from this table. The amounts shown in the table below do not include any payments in respect of the 280G “tax gross-up” provision described below.

76

77

Executive Severance Plan; Haase Offer Letter of Continued Employment

The Company has entered into an offer letter of continued employment with Mr. Haase dated February 8, 2021 (the “Offer Letter”) and maintains an Executive Severance Plan, adopted as of June 19, 2014, that covers each of its other executive officers, each of which provides for severance following certain termination events, as described below.

The Executive Severance Plan provides that, in the event that an executive officer’s employment is terminated by the Company or one of its subsidiaries without “cause” (other than due to the executive officer’s death or disability) or by the executive officer for “good reason” at any time (each, a “Qualifying Termination”), the executive officer shall be entitled to the following payments and benefits, subject to the execution and delivery of a release of claims and the executive officer’s compliance with restrictive covenants: (i) a cash payment equal to (x) for executive officers who hold the title of executive vice president and above, the sum of 1.0x annual base salary in effect immediately prior to the date of termination and 1.0x target annual bonus for the year in which termination occurs (except for Mr. Haase, whose cash severance amount is discussed below), (y) for executive officers who hold the title of senior vice president, 1.0x annual base salary in effect immediately prior to the date of termination or (z) for executive officers who hold the title of vice president, 0.5x annual base salary in effect immediately prior to the date of termination, in each case of (x), (y), and (z), payable in a single lump sum within 60 days following the date of termination; (ii) continued eligibility to participate in group health plans pursuant to COBRA, provided, that, for twelve months (or 6 months in the case of executive officers who hold the title of vice president) following the date of termination, the executive officer is responsible for the payment of the portion of the costs associated with such health coverage continuation equal to the amount paid by an active employee for similar coverage and the employer pays the balance of the cost for such coverage; and (iii) payment for executive outplacement services provided by a firm to be determined by the employer in its sole discretion for a period of 6 months following the date of termination. Each executive officer is also bound by the following restrictive covenants: (i) a non-competition covenant, a non-solicitation of customers covenant, and non-solicitation and no-hire of employees covenants that apply during the executive officer’s employment and for one year following the executive officer’s Qualifying Termination, as applicable; (ii) a perpetual confidentiality covenant; and (iii) a perpetual non-disparagement covenant.

Pursuant to the Offer Letter, Mr. Haase is a participant in the Executive Severance Plan and the cash severance amount that he is entitled to receive thereunder will be, subject to the execution and delivery of a release of claims and compliance with restrictive covenants, (i) in the event of a Qualifying Termination on or before December 31, 2022, $3,000,000, and (ii) in the event of a Qualifying Termination after December 31, 2022, either (x) 150% of his base compensation, as agreed to between Mr. Haase and the Boards or (y) in the absence of an agreement with the Boards, no less than $3,000,000.

For purposes of the Executive Severance Plan, “cause” means with respect to the termination of an executive officer by the Company or one of its subsidiaries, such executive officer’s (i) refusal or neglect to perform substantially his or her employment-related duties or services, (ii) personal dishonesty, incompetence, willful misconduct, or breach of fiduciary duty, (iii) indictment for, conviction of, or entering a plea of guilty or nolo contendere to, a crime constituting a felony or the willful violation of any applicable law (other than a traffic violation or other offense or violation outside of the course of employment or services to the Company or its subsidiaries which does not adversely affect the Company or its subsidiaries or its reputation or the ability of the executive officer to perform his or her employment-related duties or services or to represent the Company or any applicable subsidiary), (iv) failure to reasonably cooperate, following a request to do so by the Company or one

78

of its subsidiaries, in any internal or governmental investigation of the Company or any of its subsidiaries, or (v) material breach of any written covenant or agreement with the Company or any of its subsidiaries not to disclose any information pertaining to the Company or such subsidiary or not to compete or interfere with Company or such subsidiary.

For purposes of the Executive Severance Plan, “good reason” means any of the following, without the executive officer’s written consent: (i) a material diminution in an executive officer’s base salary (in the case of Mr. Haase, his Offer Letter amends this clause as described in more detail below); (ii) a material diminution in an executive officer’s authority, duties, or responsibilities; (iii) a material change in the geographic location at which the executive officer must perform the services; or (iv) any other action or inaction that constitutes a material breach by the service recipient of the agreement under which the executive officer provides services; provided, however, that a termination by the executive officer for any of the reasons listed in (i) through (iv) above shall not constitute termination for good reason unless the executive officer shall first have delivered to his or her employer a written notice setting forth with specificity the occurrence deemed to give rise to a right to terminate for good reason (which notice must be given no later than 60 days after the initial occurrence of such event), and the employer fails to cure such event within 30 days after receipt of such written notice. The executive officer’s employment must be terminated for good reason within 120 days after the occurrence of an event of good reason.

Mr. Haase’s Offer Letter amends the definition of good reason under the Executive Severance Plan as it applies to Mr. Haase to provide that for the period commencing after December 31, 2022, a “material diminution in participant’s base salary” is replaced with a “material diminution in the total value of participant’s annual base compensation,” which for this purpose is valued at $2,021,939.12, unless the Company, Hospitality, and Mr. Haase mutually agree in writing otherwise.

Notwithstanding the foregoing, in exchange for the “280G tax gross-up” payment described below, each executive officer has agreed that the consummation of the transactions contemplated by the merger agreement, and any changes or modifications to his or her authority, duties and/or responsibilities which arise solely as a result of the Company or Hospitality ceasing to be a publicly-held company or becoming a subsidiary of Parent in connection with the consummation of the transactions contemplated by the merger agreement, will not, in and of itself, constitute a “material diminution in his or her authority, duties or responsibilities” (and, therefore, will not constitute good reason) under the Executive Severance Plan.

The following table sets forth an estimate of the potential cash severance payments (for the avoidance of doubt, not including any employer-paid portion of health coverage continuation costs or the cost of executive outplacement services) that would be payable as described above in the event that the executive officer experiences a Qualifying Termination immediately following the mergers utilizing current base salaries and target bonus amounts, as applicable.

79

Golden Parachute Compensation.

As required by Item 402(t) of Regulation S-K, the following table sets forth, for our named executive officers, compensation that is based on or otherwise relates to the mergers and that will become vested or payable (in the case of “single-trigger” arrangements) upon the closing of the mergers and those that may (in the case of “double-trigger” arrangements) become vested or payable to or realized by such individuals following certain termination of employment events that occur following the closing of the mergers. For purposes of this joint proxy statement, our “named executive officers” are those individuals who are identified as named executive officers in each of the Company’s and Hospitality’s proxy statements for the 2020 annual meeting of stockholders, which proxy statements were filed with the SEC on April 23, 2020.

Depending on when the mergers occur, certain equity awards that are now unvested and included in the table below may vest pursuant to the terms of the equity awards based on the completion of continued service with the Company, independent of the mergers. The amounts indicated below are estimates that assume (i) a per-paired share merger consideration of $19.50 (without reduction for the special dividend), (ii) base salary, target bonus levels (as applicable), and equity award holdings as of date of this joint proxy statement, (iii) the mergers closing on July 1, 2021 (the assumed closing date of the mergers solely for purposes of this golden parachute compensation disclosure), (iv) that for the stock unit awards subject to performance-vesting conditions, performance is achieved at (x) 150% of target for the performance-based stock unit awards with a performance period that commences in 2019 and 2020 and (y) 200% of target for the performance-based stock unit awards with a performance period that commences in 2021, and (v) that a Qualifying Termination of each named executive officer occurs in connection with the closing of the mergers such that the executive will be entitled to severance payments and benefits under the Executive Severance Plan on the closing date (utilizing their base salary and target bonus amounts, as applicable, as of the date of this joint proxy statement). Further, the estimated potential payments in the table below assume that (i) each named executive officer’s base salary, target bonus level (as applicable), and equity award holdings remain unchanged from those in effect as of the date of this joint proxy statement (other than the then-unvested base compensation award stock units held by Mr. Haase that will be forfeited by him as of the effective time, in accordance with their terms), (ii) no named executive officer receives any additional equity grants or receives any paired shares in respect of any Company or Hospitality equity awards on or prior to the effective time, and (iii) no named executive officer enters into any new agreement with the Company or is otherwise legally entitled to, prior to the effective time, additional compensation or benefits that is based on or otherwise relates to the mergers. As a result, the actual amounts, if any, to be received by a named executive officer may materially differ from the amounts set forth below. All dollar amounts have been rounded to the nearest whole dollar.

The amounts shown in the table below also include the “280G tax gross-up” payment that is payable pursuant to the letter agreements entered into with our named executive officers, providing that, if it is determined that such named executive officer will become entitled to payments and benefits in connection with and contingent upon the transactions contemplated by the merger agreement (the “Total Payments”) that are deemed “parachute payments” under Sections 280G and 4999 of the Code, such named executive officer will be entitled to receive a gross-up payment in an amount such that, after payment by the named executive officer of all applicable taxes on the gross-up payment (including any excise tax that could be imposed under Section 4999 of the Code (the “Excise Tax”)), the named executive officer will retain an amount of the gross-up payment equal to the Excise Tax imposed upon the Total Payments.

80

Indemnification and Insurance.

Pursuant to the terms of the merger agreement, our directors and executive officers will be entitled to certain ongoing indemnification and insurance coverage, further described in the section entitled “The Merger Agreement—Indemnification and Insurance.”

Regulatory Matters

We are unaware of any material federal or state regulatory requirements or approvals that are required for the execution of the merger agreement or the completion of either merger, other than the filing of the certificates of merger with respect to each of the mergers with the Secretary of State of the State of Delaware.

Although the completion of the transactions contemplated by the merger agreement is not conditioned on receipt of any approvals or clearances pursuant to any antitrust laws, clearances under antitrust laws of Finland, Ireland and Spain have been sought by the parties to the merger agreement in connection with the transactions contemplated by the merger agreement. The parties submitted filings to the Irish Competition and Consumer Protection Commission, the Finnish Competition and Consumer Authority and the Spanish National Markets and Competition Commission on March 25, 2021, April 8, 2021 and April 13, 2021, respectively. On April 13, 2021, the parties received notice from the Irish Competition and Consumer Protection Commission permitting the completion of the proposed transactions under Irish antitrust laws. In addition, on April 16, 2021, the parties received notice from the Finnish Competition and Consumer Authority permitting the completion of the proposed transactions under Finnish antitrust law. Although it is expected that these foreign merger control clearances and approvals under these foreign antitrust laws will be obtained, there are no assurances that these regulatory clearances and approvals will be timely obtained, obtained at all or that the applicable regulatory authorities will not impose additional conditions on the consummation of the transactions contemplated in the merger agreement.

Litigation Relating to the Mergers

Between April 14 and April 21, 2021, three stockholder complaints relating to the mergers were filed against the Company, Hospitality and each of the individual members of the Boards. Stein v. Extended Stay America, Inc., et al., Case No. 1:21-cv-03272, and Ciccotelli v. Extended Stay America, Inc., et al., Case No. 1:21-cv-03551, were filed in the United States District Court for the Southern District of New York, and Schwartz v. Extended Stay America, Inc., et al., Case No. 1:21-cv-02185, was filed in the United States District Court for the Eastern District of New York. The Stein complaint also names Blackstone and Starwood as additional defendants. Each of the stockholder complaints asserts that defendants violated Section 14(a) and 20(a) of the Exchange Act and certain related rules and regulations by allegedly making false and misleading statements relating to the mergers, or failing to disclose allegedly material facts, including relating to the financial projections of the Paired Entities

81

and analyses of financial advisors, in the preliminary joint proxy statement filed on April 13, 2021. All three stockholder complaints seek an injunction against consummating the mergers until further disclosures are made and also seek an award of damages, as well as attorneys’ and expert fees and expenses. The courts have not acted on any of these complaints, and no relief has been granted as of the date of this joint proxy statement. We believe that each of the lawsuits is without merit.

Material U.S. Federal Income Tax Consequences

The following is a general discussion of the material U.S. federal income tax consequences of the mergers and the special dividend to U.S. holders and non-U.S. holders (each as defined below) of our paired shares. This discussion is based on the provisions of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), applicable U.S. Treasury Regulations, judicial opinions and administrative rulings and published positions of the Internal Revenue Service (the “IRS”), each as in effect as of the date hereof. These authorities are subject to change or differing interpretations, possibly with retroactive effect, and any such change or interpretation could affect the accuracy of the statements and conclusions set forth in this discussion. This discussion does not address any tax consequences arising under the Medicare contribution tax on net investment income, nor does it address any tax considerations under state, local or non-U.S. laws or U.S. federal laws other than those pertaining to the U.S. federal income tax.

For purposes of this discussion, the term “U.S. holder” means a beneficial owner of our paired shares that is, for U.S. federal income tax purposes:

For purposes of this discussion, the term “non-U.S. holder” means a beneficial owner of our paired shares, other than an entity or arrangement classified as a partnership for U.S. federal income tax purposes, that is not a U.S. holder.

This discussion applies only to holders of our paired shares who hold such shares as “capital assets” within the meaning of the Code (generally, property held for investment). Further, this discussion is for general informational purposes only and does not address all aspects of U.S. federal income taxation that may be relevant to specific holders in light of their particular facts and circumstances, and it does not apply to holders subject to special treatment under U.S. federal income tax laws (including, for example, insurance companies, dealers or brokers in securities or foreign currencies, traders in securities who elect to apply the mark-to-market method of accounting, holders subject to the alternative minimum tax, persons who are required to recognize income or gain with respect to the mergers or the special dividend no later than such income or gain is required to be reported on an applicable financial statement, U.S. holders that have a functional currency other than the U.S. dollar, tax-exempt organizations, retirement plans, individual retirement accounts or other tax-deferred or advantaged accounts (or persons holding shares through such plans or accounts), banks and other financial institutions, certain former citizens or former long-term residents of the United States, “controlled foreign corporations,” “passive foreign investment companies,” partnerships or other entities or arrangements treated as partnerships for U.S. federal income tax purposes or other flow-through entities (and investors therein), S corporations, real estate investment trusts, regulated investment companies, “qualified foreign pension funds” (within the meaning of Section 897(1)(2) of the Code) or entities all of the interests in which are held by a qualified pension fund,

82

“qualified shareholders” (within the meaning of Section 897(k)(3) of the Code) or investors therein, non-U.S. holders who hold, or have held at any time, directly, indirectly, or constructively, more than 5% of our outstanding shares, holders who hold our paired shares as part of a hedge, straddle, constructive sale, conversion or other integrated or risk reduction transaction, and holders who acquired our paired shares through the exercise of employee stock options or otherwise as compensation).

If a partnership (including any entity or arrangement classified as a partnership for U.S. federal income tax purposes) holds our paired shares, the tax treatment of a partner in such partnership will generally depend on the status of the partners and the activities of the partnership. Partnerships that hold our paired shares, and partners in such partnerships, should consult their own tax advisors regarding the U.S. federal, state, local and non-U.S. tax consequences of the mergers and the special dividend to them in light of their particular circumstances.

For certain of our stockholders, the tax consequences of the mergers and the special dividend (including applicable withholding taxes) could be different than the tax consequences of selling their shares prior to the mergers. This joint proxy statement does not discuss the tax consequences of selling shares prior to the mergers. In view of those potential different tax consequences, we encourage all holders to consult their own tax advisors regarding the tax consequences to them of selling their shares prior to the mergers, as compared to the tax consequences to them of the mergers and the receipt of the special dividend. In addition, all holders should consult their own tax advisors regarding the specific tax consequences of the mergers and the special dividend to them in light of their particular facts and circumstances, including with respect to the applicability and effect of any U.S. federal, state, local, foreign or other tax laws.

Consequences of the Special Dividend to U.S. Holders of our Paired Shares

As described below in “The Merger Agreement—Special Dividend” upon the request of Parent, the Company will declare and pay the special dividend immediately prior to the effective time of the Company merger. The special dividend will be paid to the holders of record of Company common stock as of immediately prior to the open of business on the closing date. The amount of the special dividend will represent the estimated amount of current and accumulated earnings and profits of the Company calculated through the portion of the taxable year that includes the closing date ending at the effective time, subject to certain limitations described in “The Merger Agreement—Special Dividend”. A corporation is required to determine its earnings and profits for an applicable taxable year on an annual basis following the end of the applicable taxable year. Accordingly, events subsequent to the closing date may impact the Company’s current earnings and profits for the taxable year in which the closing occurs, such that the amount of the Company’s current and accumulated earnings and profits through the closing date, as finally determined, may not equal the amount of the special dividend.

If the special dividend is made, the Company intends that the special dividend be treated as a dividend for U.S. federal income tax purposes to the extent paid from its current or accumulated earnings and profits, as determined under U.S. federal income tax principles, and accordingly will be taken into account by U.S. holders as ordinary income. Dividends paid to a non-corporate U.S. holder by the Company that constitute qualified dividend income will be taxable to the holder at the preferential rates applicable to long-term capital gains provided that the holder holds the shares for more than 60 days during the 121-day period beginning 60 days before the ex-dividend date and meets other holding period requirements. Dividends paid to corporate U.S. holders may be eligible for the dividends received deduction. If the amount of the special dividend exceeds the Company’s current and accumulated earnings and profits, the excess is intended to be treated as a nontaxable return of capital to the extent of the U.S. holder’s adjusted tax basis in its Company common stock and will reduce (but not below zero) such U.S. holder’s adjusted tax basis in its Company common stock, and any remaining excess will be treated as gain from a disposition of Company common stock. Such gain will be included in a U.S. holder’s income as long-term capital gain (or short-term capital gain if the stock has been held for one year or less), subject to the tax treatment described below under “—Consequences of the Mergers to U.S. Holders of our Paired Shares.”

The merger consideration will be reduced by the per share amount of the special dividend.

83

Although the special dividend is intended to be treated for U.S. federal income tax purposes as described above, it could be treated instead as Company merger consideration. Under such treatment, a U.S. holder would be treated as not receiving a distribution and instead as having sold its shares of Company common stock for consideration equal to the merger consideration attributable to the Company common stock (without reduction for the special dividend), and such U.S. holder would be subject solely to the treatment described below under “—Consequences of the Mergers to U.S. Holders of our Paired Shares.”

Consequences of the Mergers to U.S. Holders of our Paired Shares

The receipt of cash in the mergers by U.S. holders of our paired shares will be a taxable transaction to U.S. holders for U.S. federal income tax purposes. The merger consideration paid for a paired share in the mergers will be allocated between the share of Company common stock and the share of Hospitality class B common stock that constitute the paired share in accordance with their respective fair market values, which the parties to the merger agreement have agreed shall be $11.69 per share of Company common stock (reduced by the special dividend, if any) and $7.81 per share of Hospitality class B common stock, in each case subject to adjustment as described below in “The Merger Agreement—Treatment of the Company Capital Stock and Hospitality Capital Stock.”

Disposition of Shares of Hospitality Class B Common Stock in the Hospitality Merger. In general, a U.S. holder will realize gain or loss upon the exchange of shares of Hospitality class B common stock for cash in the Hospitality merger in an amount equal to the difference between the amount of cash received for such shares and the U.S. holder’s aggregate adjusted tax basis in its shares of Hospitality class B common stock at the time of the Hospitality merger. In general, a U.S. holder’s adjusted tax basis in its shares of Hospitality class B common stock will equal the U.S. holder’s acquisition cost, increased by the excess of net capital gains deemed distributed to the U.S. holder less tax deemed paid on such deemed distribution and reduced by returns of capital. In general, capital gains recognized by individuals and other non-corporate U.S. holders upon the sale or disposition of their shares of Hospitality class B common stock will be subject to tax at preferential rates, if the shares of Hospitality class B common stock are held for more than 12 months, and will be taxed at ordinary income rates if shares of Hospitality class B common stock are held for 12 months or less. Gains recognized by U.S. holders that are corporations are subject to U.S. federal income tax at the same rates as apply to ordinary income, whether or not classified as long-term capital gains.

Holders are advised to consult with their tax advisors with respect to their capital gain tax liability. Capital losses recognized by a U.S. holder upon the disposition of Hospitality class B common stock held for more than one year at the time of disposition will be considered long-term capital losses, and are generally available only to offset capital gain income of the U.S. holder but not ordinary income (except in the case of individuals, who may offset up to $3,000 of ordinary income each year). In addition, any loss upon the disposition of shares of Hospitality class B common stock in the Hospitality merger by a U.S. holder who has held the shares for six months or less, after applying holding period rules, will be treated as a long-term capital loss to the extent of distributions received from Hospitality that were required to be treated by the U.S. holder as long-term capital gain.

Disposition of Shares of Company Common Stock in the Company Merger. In general, a U.S. holder will realize gain or loss upon the exchange of shares of Company common stock for cash in the Company merger in an amount equal to the difference between the amount of cash received for such shares and the U.S. holder’s aggregate adjusted tax basis in shares of Company common stock at the time of the Company merger. In general, a U.S. holder’s adjusted tax basis in its shares of Company common stock will equal the U.S. holder’s acquisition cost reduced by returns of capital, including any portion of the special dividend that is treated as a return of capital. In general, capital gains recognized by individuals and other non-corporate U.S. holders upon the sale or disposition of shares of Company common stock will be subject to U.S. federal income tax at preferential rates, if the Company common stock is held for more than 12 months, and will be taxed at ordinary income rates if Company common stock is held for 12 months or less. Gains recognized by U.S. holders that are corporations are

84

subject to U.S. federal income tax at the same rates that apply to ordinary income, whether or not classified as long-term capital gains.

Holders are advised to consult with their tax advisors with respect to their capital gain tax liability. Capital losses recognized by a U.S. holder upon the disposition of Company common stock held for more than one year at the time of disposition will be considered long-term capital losses, and are generally available only to offset capital gain income of the U.S. holder but not ordinary income (except in the case of individuals, who may offset up to $3,000 of ordinary income each year).

Consequences of the Special Dividend to Non-U.S. Holders of our Paired Shares

As discussed above in “—Consequences of the Special Dividend to U.S. Holders of our Paired Shares,” immediately prior to the effective time of the Company merger, upon Parent’s request the Company will declare and pay the special dividend. The amount of the special dividend is intended to represent the estimated amount of current and accumulated earnings and profits of the Company calculated through the portion of the taxable year that includes the closing date ending at the effective time, however, as discussed above, there can be no assurance that the Company’s actual current and accumulated earnings and profits, as finally determined, will equal the amount of the special dividend, which may impact its treatment for U.S. federal income tax purposes, as discussed below.

If the special dividend is made, the Company intends (and intends to report) that the special dividend be treated as a dividend for U.S. federal income tax purposes to the extent paid from its current or accumulated earnings and profits, as determined under U.S. federal income tax principles. If the special dividend exceeds the Company’s current and accumulated earnings and profits, the excess is intended to be treated as a nontaxable return of capital to the extent of the holder’s adjusted tax basis in its Company common stock and will reduce (but not below zero) such holder’s adjusted tax basis in its Company common stock, and any remaining excess will be treated as gain from a disposition of Company common stock, subject to the tax treatment described below under “—Consequences of the Mergers to Non-U.S. Holders of our Paired Shares.”

If the special dividend is not treated as a distribution with respect to the shares of Company common stock for U.S. federal income tax purposes, as described above in “—Consequences of the Special Dividend to U.S. Holders of our Paired Shares,” it could be treated as additional cash consideration in the Company merger. Under such treatment, a non-U.S. holder would be treated as not receiving a distribution and instead as having sold its shares of Company common stock for consideration equal to the merger consideration attributable to the Company common stock (without reduction for the special dividend), and such non-U.S. holder would be subject solely to the treatment described below under “—Consequences of the Mergers to Non-U.S. Holders of our Paired Shares.” The portion of the special dividend received by a non-U.S. holder that is treated as a dividend and that is not effectively connected with the non-U.S. holder’s conduct of a trade or business within the United States generally will be subject to withholding of U.S. federal income tax at a rate of 30%. A non-U.S. holder may be eligible for a lower rate under an exemption or applicable income tax treaty between the United States and its jurisdiction of tax residence. In order to claim the benefit of an applicable income tax treaty, a non-U.S. holder will be required to provide to the applicable withholding agent a properly executed IRS Form W-8BEN or W-8BEN-E (or other applicable form) in accordance with the applicable certification and disclosure requirements. Special rules apply to partnerships and other pass-through entities and these certification and disclosure requirements also may apply to beneficial owners of partnerships and other pass-through entities that hold Company common stock.

The portion of the special dividend received by a non-U.S. holder that is treated as a dividend and that is effectively connected with the non-U.S. holder’s conduct of a trade or business within the United States will be taxed on a net income basis at the regular graduated rates and in the manner applicable to United States persons (unless the non-U.S. holder is eligible for and properly claims the benefit of an applicable income tax treaty and the dividends are not attributable to a permanent establishment or fixed base maintained by the

85

non-U.S. holder in the United States, in which case the non-U.S. holder may be eligible for a lower rate under the applicable income tax treaty). Dividends that are effectively connected with a non-U.S. holder’s conduct of a trade or business in the United States will not be subject to the withholding of U.S. federal income tax discussed above if the non-U.S. holder provides to the applicable withholding agent a properly executed IRS Form W-8ECI (or other applicable form) in accordance with the applicable certification and disclosure requirements. A non-U.S. holder that is treated as a corporation for U.S. federal income tax purposes may also be subject to a “branch profits” tax at a 30% rate (or a lower rate if the non-U.S. holder is eligible for a lower rate under an applicable income tax treaty) on the portion of the special dividend received by a non-U.S. holder that is treated as a dividend.

The certifications described above must be provided to the applicable withholding agent prior to the payment of dividends and must be updated periodically. A non-U.S. Holder may obtain a refund or credit of any excess amounts withheld by timely filing an appropriate claim for a refund with the IRS. Non-U.S. Holders should consult their own tax advisors regarding their eligibility for benefits under a relevant income tax treaty and the manner of claiming such benefits.

Because the Company believes it is a “U.S. real property holding corporation” (“USRPHC”), as described below, any non-U.S. holder which holds more than 5% of the Company common stock, actually or constructively, during the applicable testing period, will generally be taxed on any gain on the sale or deemed sale of Company common stock in the same manner as gain that is effectively connected with the conduct of a U.S. trade or business, except that the branch profits tax generally will not apply.

Consequences of the Mergers to Non-U.S. Holders of our Paired Shares

Disposition of Shares of Hospitality Class B Common Stock in the Hospitality Merger. Non-U.S. holders could incur tax under the Foreign Investment in Real Property Tax Act of 1980 (“FIRPTA”) with respect to gain realized upon a disposition of shares of Hospitality class B common stock if Hospitality is a USRPHC during a specified testing period. If at least 50% of a U.S. corporation’s assets are “U.S. real property interests” (“USRPIs”), then the U.S. corporation will be a USRPHC. Hospitality believes that it is a USRPHC based on the composition of its assets. However, even if Hospitality is a USRPHC, a non-U.S. holder generally would not incur tax under FIRPTA on gain attributable to the sale of shares of Hospitality class B common stock if Hospitality is a “domestically controlled qualified investment entity.” A domestically controlled qualified investment entity includes a REIT in which, at all times during a specified testing period, less than 50% in value of its stock is held directly or indirectly by non-U.S. holders. We intend to take the position that Hospitality is a domestically controlled REIT under the Code. However, there can be no assurance that the IRS will not challenge this treatment or that a court would not sustain such a challenge. Regardless of whether Hospitality qualifies as a domestically controlled qualified investment entity at the time the non-U.S. holder sells shares of Hospitality class B common stock pursuant to the mergers, an additional exception to the tax under FIRPTA may be available if shares of Hospitality class B common stock are regularly traded on an established securities market. Under that exception, the gain from a sale by a non-U.S. holder will not be subject to tax under FIRPTA if:

While there is no direct authority addressing whether a component of a paired interest is considered to be regularly traded on an established securities market by virtue of the paired interest being considered to be traded on an established securities market, we intend to take the position that shares of Hospitality class B common stock are regularly traded on an established securities market in the United States.

86

If the gain on the sale of shares of Hospitality class B common stock were taxed under FIRPTA, a non-U.S. holder would be taxed on that gain in the same manner as U.S. holders, subject to applicable alternative minimum tax and a special alternative minimum tax in the case of nonresident alien individuals. Furthermore, a non-U.S. holder generally will incur tax on gain not subject to FIRPTA if:

Disposition of Shares of Company Common Stock in the Company Merger. Non-U.S. holders could incur tax under FIRPTA with respect to gain realized upon a disposition of shares of Company common stock if the Company is a USRPHC during a specified testing period. If at least 50% of a U.S. corporation’s assets are USRPIs, then the U.S. corporation will be a USRPHC. Assuming Hospitality is a USRPHC, the Company believes it is a USRPHC as a result of holding 100% of the Hospitality class A common stock. If the Company common stock is regularly traded on an established securities market, an exception to the tax under FIRPTA may be available. Under this exception, the gain from such a sale by such a non-U.S. holder will not be subject to tax under FIRPTA if:

While there is no direct authority addressing whether a component of a paired interest is considered to be regularly traded on an established securities market by virtue of the paired interest being considered to be traded on an established securities market, we intend to take the position that the shares of Company common stock are regularly traded on an established securities market in the United States.

If the gain on the sale of shares of Company common stock were taxed under FIRPTA, in whole or in part, a non-U.S. holder would be taxed on that gain in the same manner as U.S. holders, subject to applicable alternative minimum tax and a special alternative minimum tax in the case of nonresident alien individuals. Furthermore, a non-U.S. holder generally will incur tax on gain not subject to FIRPTA if:

Information Reporting Requirements and Withholding

Information reporting and backup withholding (currently, at a rate of 24%) generally will apply to payments of cash made pursuant to the mergers and the special dividend. Backup withholding will not apply, however, to a holder who (1) in the case of a U.S. holder, furnishes a correct taxpayer identification number and certifies that it is not subject to backup withholding on a duly executed IRS Form W-9, (2) in the case of a non-U.S. holder, furnishes a duly executed, applicable IRS Form W-8, or (3) is otherwise exempt from backup withholding and complies with other applicable rules and certification requirements.

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be claimed as a refund or a credit against such holder’s U.S. federal income tax liability (if any) provided the required information is furnished to the IRS on a timely basis.

87