10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2018

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-38168

CorePoint Lodging Inc.

(Exact name of registrant as specified in its charter)

Maryland	82-1497742
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

909 Hidden Ridge, Suite 600

Irving, Texas 75038

(Address of principal executive offices) (Zip Code)

(972) 893-3199

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒ (Do not check if a smaller reporting company)	Smaller reporting company	☐
		Emerging growth Company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

The registrant had outstanding 59,613,393 shares of Common Stock, par value $0.01 per share as of August 7, 2018.

COREPOINT LODGING INC.

FORM 10-Q TABLE OF CONTENTS

FOR THE PERIOD ENDED JUNE 30, 2018

		Page No.
	BASIS OF PRESENTATION	1
	SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS	2
PART I.	FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements of CorePoint Lodging Inc. (Unaudited)	4
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	29
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	48
Item 4.	Controls and Procedures	49
PART II.	OTHER INFORMATION	50
Item 1.	Legal Proceedings	50
Item 1A.	Risk Factors	50
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	50
Item 3.	Defaults Upon Senior Securities	50
Item 4.	Mine Safety Disclosures	50
Item 5.	Other Information	50
Item 6.	Exhibits	51

BASIS OF PRESENTATION

On May 30, 2018, La Quinta Holdings Inc. (“LQH Parent” and, together with its consolidated subsidiaries, “LQH”) completed the distribution to its stockholders of all the then-outstanding shares of common stock of CorePoint Lodging Inc. (“CorePoint Parent” and, together with its consolidated subsidiaries, “CorePoint Lodging”), a wholly owned subsidiary of LQH Parent that holds a portfolio of LQH’s hotels, following which CorePoint Parent became an independent, self-administered, publicly traded company. The shares of common stock of CorePoint Parent were registered pursuant to Section 12(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), pursuant to a Registration Statement on Form 10 (the “Form 10”) of CorePoint Parent which the Securities and Exchange Commission (the “SEC”) declared effective on May 8, 2018. As part of the separation, LQH underwent an internal reorganization, after which it completed the separation by distributing all of the then-outstanding shares of CorePoint Parent common stock on a pro rata basis to the holders of LQH Parent common stock in a taxable transaction. We refer to this pro rata distribution as the “distribution” and we refer to the separation, including the internal reorganization and distribution, as the “spin-off.”

Unless otherwise indicated or the context otherwise requires, reference in this Quarterly Report on Form 10-Q to:

• “CorePoint Lodging,” “CorePoint,” “we,” “our,” “us” and the “Company” refer to CorePoint Lodging Inc. and its consolidated subsidiaries, and references to “CorePoint Parent” refer only to CorePoint Lodging Inc., exclusive of its subsidiaries, in each case, after giving effect to the spin-off, including the internal reorganization and distribution;

• “LQH” refers to La Quinta Holdings Inc. and its consolidated subsidiaries and references to “LQH Parent” refer only to La Quinta Holdings Inc., exclusive of its subsidiaries, in each case before giving effect to the spin-off; and

• “La Quinta” refers to La Quinta Holdings Inc. and its consolidated subsidiaries, and references to “La Quinta Parent” refer only to La Quinta Holdings Inc., exclusive of its subsidiaries, in each case after giving effect to the spin-off, including the internal reorganization and distribution.

1

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

In addition to historical information, this Quarterly Report on Form 10-Q may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Exchange Act, which are subject to the “safe harbor” created by those sections. All statements, other than statements of historical facts included in this Quarterly Report on Form 10-Q, including statements concerning our plans, objectives, goals, beliefs, business strategies, future events, business conditions, results of operations, financial position, business outlook, business trends and other information, may be forward-looking statements. Words such as “estimates,” “expects,” “contemplates,” “will,” “anticipates,” “projects,” “plans,” “intends,” “believes,” “forecasts,” “may,” “should” and variations of such words or similar expressions are intended to identify forward-looking statements. The forward-looking statements are not historical facts, and are based upon our current expectations, beliefs, estimates and projections, and various assumptions, many of which, by their nature, are inherently uncertain and beyond our control. Our expectations, beliefs, estimates and projections are expressed in good faith and we believe there is a reasonable basis for them. However, there can be no assurance that management’s expectations, beliefs, estimates and projections will result or be achieved and actual results may vary materially from what is expressed in or indicated by the forward-looking statements.

There are a number of risks, uncertainties and other important factors, many of which are beyond our control, that could cause our actual results to differ materially from the forward-looking statements contained in this Quarterly Report on Form 10-Q. Such risks, uncertainties and other important factors that could cause actual results to differ include, among others, the risks, uncertainties and factors set forth under “Risk Factors” in the Company’s Information Statement (the “Information Statement”) included as Exhibit 99.1 to the Form 10 filed with the SEC on May 7, 2018, as such risk factors may be updated from time to time in our periodic filings with the SEC, and are accessible on the SEC’s website at www.sec.gov, and also include the following:

• risks related to the recently completed spin-off and the merger of LQH’s management and franchise business with Wyndham Worldwide Corporation (“Wyndham Worldwide”);

• business and financial risks inherent to the lodging industry;

• macroeconomic and other factors beyond our control can adversely affect and reduce lodging demand;

• contraction in the global economy or low levels of economic growth;

• the geographic concentration of our hotels;

• inability to compete effectively;

• our concentration in the La Quinta brand and any deterioration in the quality or reputation of the La Quinta brand or our relationship with the La Quinta brand;

• our dependence on the performance of La Quinta and other third-party hotel managers;

• covenants in our hotel franchise and management agreements that limit or restrict the sale of our hotels or impose brand standards;

• inability to maintain good relationships with La Quinta and other third-party hotel managers and franchisors;

• delays or increased expense relating to our efforts to renovate, develop or redevelop our hotels;

• seasonal and cyclical volatility in the lodging industry;

• decreases in revenue without corresponding decreases in expenses;

• the capital intensive nature of our business;

• risks resulting from significant investments in real estate;

• risks posed by our acquisition, redevelopment, repositioning, renovation and re-branding activities, as well as our disposition activities;

• required capital expenditures and costs associated with, or failure to maintain brand standards;

• the loss of a brand license at one or more of our hotels;

• cyber threats and the risk of data breaches or disruptions of our hotel franchisors’, managers’ or our own information technology systems;

• the growth of internet reservation channels;

• disruptions to the functioning or transition of the La Quinta reservation system or other technology programs;

2

• the cessation, reduction or taxation of program benefits of La Quinta’s Returns loyalty program or our access to it;

• risks of having a number of our hotels subject to ground leases;

• unknown or contingent liabilities related to the hotels we may acquire in the future;

• disruptions to our ability to access capital at times and on terms reasonably acceptable to us;

• the loss of senior executives;

• risks associated with the employment of hotel personnel, particularly with hotels that employ unionized labor;

• the results of the audits by the Internal Revenue Service;

• our substantial indebtedness;

• risks related to qualifying and maintaining our qualifications as a real estate investment trust (“REIT”); and

• The significant influence of affiliates of The Blackstone Group L.P. over us.

We caution you that the risks, uncertainties and other factors referenced above may not contain all of the risks, uncertainties and other factors that are important to you. In addition, we cannot assure you that we will realize the results, benefits or developments that we expect or anticipate or, even if substantially realized, that they will result in the consequences or affect us or our business in the way expected. There can be no assurance that (i) we have correctly measured or identified all of the factors affecting our business or the extent of these factors’ likely impact, (ii) the available information with respect to these factors on which such analysis is based is complete or accurate, (iii) such analysis is correct or (iv) our strategy, which is based in part on this analysis, will be successful. All forward-looking statements in this report apply only as of the date of this report or as of the date they were made and are expressly qualified in their entirety by the cautionary statements included in this report. Except as required by applicable law, we undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise.

3

CorePoint Lodging Inc.

Condensed Consolidated Balance Sheets (Unaudited)

As of June 30, 2018 and December 31, 2017

(in millions, except share data)

	June 30, 2018			December 31, 2017
ASSETS
Assets:
Real estate
Land	$	738		$	739
Buildings and improvements		2,772			2,706
Furniture, fixtures, and other equipment		385			363
Gross operating real estate		3,895			3,808
Less accumulated depreciation		(1,502	)		(1,425	)
Net operating real estate		2,393			2,383
Construction in progress		74			75
Total real estate, net		2,467			2,458
Cash and cash equivalents		80			141
Accounts receivable, net		49			42
Other assets		55			32
Assets from discontinued operations		—			280
Total Assets	$	2,651		$	2,953
LIABILITIES AND EQUITY
Liabilities:
Debt, net	$	1,032		$	992
Mandatorily redeemable preferred shares		15			—
Accounts payable and accrued expenses		83			65
Other liabilities		8			9
Deferred tax liabilities		—			213
Liabilities from discontinued operations		—			846
Total Liabilities		1,138			2,125
Commitments and Contingencies
Equity:
Preferred Stock, $0.01 par value; 50,000,000 and 100,000,000 shares authorized as June 30, 2018 and December 31, 2017, respectively; 15,000 and none outstanding as of  June 30, 2018 and December 31, 2017, respectively		—			—
Common Stock, $0.01 par value; 1,000,000,000 and 2,000,000,000 shares authorized at June 30, 2018 and December 31, 2017, respectively; 59,687,447 and 66,239,037 shares issued as of June 30, 2018 and December 31, 2017, respectively; and  59,576,383 and 58,672,998 shares outstanding as of June 30, 2018 and December 31, 2017, respectively		1			1
Additional paid-in-capital		973			1,181
Retained Earnings (accumulated deficit)		539			(144	)
Treasury stock at cost, 111,064 shares at June 30, 2018 and 7,566,039 shares at     December 31, 2017		(3	)		(212	)
Accumulated other comprehensive loss		—			(1	)
Noncontrolling interests		3			3
Total Equity		1,513			828
Total Liabilities and Equity	$	2,651		$	2,953

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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CorePoint Lodging Inc.

Condensed Consolidated Statements of Operations (Unaudited)

For the Three and Six Months Ended June 30, 2018 and 2017

(in millions, except share data)

	Three months ended June 30,						Six months ended June 30,
	2018			2017			2018			2017
REVENUES:
Rooms	$	228		$	221		$	420		$	421
Other		5			4			9			8
Total Revenues		233			225			429			429
OPERATING EXPENSES:
Rooms		98			89			185			174
Other departmental and support		30			29			59			58
Property tax, insurance and other		17			10			35			27
Management and royalty fees		9			—			9			—
Corporate general and administrative		39			19			63			38
Depreciation and amortization		39			34			76			68
Other, net		3			(1	)		2			(3	)
Total Operating Expenses		235			180			429			362
Operating Income (Loss)		(2	)		45			—			67
OTHER INCOME (EXPENSES):
Interest expense		(18	)		(12	)		(31	)		(24	)
Other income, net		4			—			4			—
Loss on extinguishment of debt		(10	)		—			(10	)		—
Total Other Expenses, net		(24	)		(12	)		(37	)		(24	)
Income (loss) from Continuing Operations Before Income Taxes		(26	)		33			(37	)		43
Income tax expense		(2	)		(14	)		(1	)		(19	)
Income (loss) from Continuing Operations, net of tax		(28	)		19			(38	)		24
Loss from Discontinued Operations, net of tax		(20	)		(2	)		(25	)		(6	)
Net Income (loss) attributable to CorePoint Lodging stockholders	$	(48	)	$	17		$	(63	)	$	18
Earnings (loss) per share:
Basic and diluted from continuing operations	$	(0.48	)	$	0.32		$	(0.65	)	$	0.41
Basic and diluted from discontinued operations		(0.34	)		(0.03	)		(0.43	)		(0.10	)
Basic and diluted earnings (loss) per share	$	(0.82	)	$	0.29		$	(1.08	)	$	0.31

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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CorePoint Lodging Inc.

Condensed Consolidated Statements of Comprehensive Income (Unaudited)

For the Three and Six Months Ended June 30, 2018 and 2017

(in millions)

	Three Months Ended					Six Months Ended
	June 30, 2018			June 30, 2017		June 30, 2018			June 30, 2017
NET INCOME (LOSS)	$	(48	)	$	17	$	(63	)	$	18
Cash flow hedge adjustment, net of tax		3			—		3			2
Gain on termination of cash flow hedge		(3	)		—		(3	)		—
Comprehensive net income (loss) attributable to CorePoint    Lodging's Stockholders	$	(48	)	$	17	$	(63	)	$	20

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

6

CorePoint Lodging Inc.

Condensed Consolidated Statement of Equity (Unaudited)

For the Six Months Ended June 30, 2018

(in millions, except share data)

	Equity Attributable to CorePoint Lodging Inc. Stockholders
	Common Stock					Treasury Stock			Additional Paid in Capital			Retained Earnings (Accumulated Deficit)			Accumulated Other Comprehensive Loss			Noncontrolling Interests		Total Equity
	Shares			Amount
Balance as of January 1, 2018		58,672,998		$	1	$	(212	)	$	1,181		$	(144	)	$	(1	)	$	3	$	828
Net loss		—			—		—			—			(63	)		—			—		(63	)
Equity-based compensation		1,063,311			—		—			6			—			—			—		6
Repurchase of common stock (pre spin-off)		(48,862	)		—		(2	)		—			—			—			—		(2	)
Retirement of treasury shares		—			—		214			(214	)		—			—			—		—
Cash flow hedge adjustment		—			—		—			—			—			4			—		4
Gain on termination of cash flow hedge		—			—		—			—			—			(3	)		—		(3	)
Repurchase of common stock (post spin-off)		(111,064	)		—		(3	)		—			—			—			—		(3	)
Reorganization and separation from La Quinta Holdings Inc		—			—		—			—			746			—			—		746
Balance as of June 30, 2018		59,576,383		$	1	$	(3	)	$	973		$	539		$	—		$	3	$	1,513

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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COREPOINT LODGING INC.

Condensed Consolidated Statements of Cash Flows (Unaudited)

For the Six Months Ended June 30, 2018 and 2017

(in millions)

	June 30, 2018			June 30, 2017
Cash flows from operating activities:
Net income (loss)	$	(63	)	$	18
Adjustment to reconcile net income (loss) to net cash provided    by operating activities:
Depreciation and amortization		79			72
Amortization of other assets		1			—
Gain (loss) related to casualty disasters		2			(3	)
Loss on extinguishment of debt		17			—
Amortization of deferred costs		4			3
Equity-based compensation expense		6			8
Deferred tax (benefit) expense		(1	)		8
Provision for doubtful accounts		1			1
Changes in assets and liabilities:
Accounts receivable		9			(2	)
Other assets		(14	)		(10	)
Accounts payable and accrued expenses		(18	)		(10	)
Other liabilities		(1	)		5
Net cash provided by operating activities		22			90
Cash flows from investing activities:
Capital expenditures		(94	)		(105	)
Lenders escrow		(15	)		—
Insurance proceeds on casualty disasters		7			5
Proceeds from sale of assets		4			22
Payment of franchise incentives		—			(1	)
Net cash used in investing activities		(98	)		(79	)
Cash flows from financing activities:
Proceeds from debt		1,060			—
Repayment of debt		(1,005	)		(9	)
Debt issuance costs		(29	)		—
Issuance of mandatorily redeemable preferred shares		15			—
Proceeds on termination of cash flow hedge		3			—
Payment for interest rate cap		(1	)		—
Purchase of treasury stock		(5	)		(1	)
Reorganization and separation from La Quinta Holdings Inc.		(23	)		—
Net cash provided by (used in) financing activities		15			(10	)
Increase (decrease) in cash and cash equivalents		(61	)		1
Cash and cash equivalents at the beginning of the period		141			161
Cash and cash equivalents at the end of the period	$	80		$	162
For supplemental disclosures, see Note 13 : "Supplemental Disclosures of Cash Flow Information"

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

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CorePoint Lodging Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

As of and for the three and six months ended June 30, 2018

NOTE 1. ORGANIZATION AND BASIS OF PRESENTATION

Organization and Business

CorePoint Lodging Inc., a Maryland corporation (“we,” “us,” “our,” “CorePoint Lodging” or the “Company”) is a nationwide lodging real estate company, primarily serving the upper mid-scale and mid-scale segments, with a portfolio of select service hotels located in the United States (“U.S.”).

The following table sets forth the number of owned and joint venture hotels as of June 30, 2018 and December 31, 2017 respectively:

	June 30, 2018				December 31, 2017
	# of hotels		# of rooms		# of hotels		# of rooms
Owned (1)		315		40,300		316		40,400
Joint Venture		1		200		1		200
Totals		316		40,500		317		40,600

⁽¹⁾ As of June 30, 2018 and December 31, 2017,  two and three of the owned hotels, respectively, were classified as assets held for sale.

For U.S. federal income tax purposes, we intend to elect to be taxed as a real estate investment trust (“ REIT”), effective May 31, 2018. We are currently, and expect to continue to be, organized and operated in a REIT qualified manner. As a REIT, the Company is generally not subject to federal corporate income tax on the portion of its net income that is currently distributed to its shareholders.  To maintain our REIT status, we are required to meet several requirements as provided by the Internal Revenue Code of 1986, as amended (the “Code”). These include that the Company cannot operate or manage its hotels. Therefore, the REIT leases the hotel properties to CorePoint TRS L.L.C., the Company's wholly owned taxable REIT subsidiary ("TRS"), which engages third-party eligible independent contractors to manage the hotels. CorePoint TRS L.L.C. is subject to federal, state and local income taxes. Also, to maintain REIT status, we must distribute annually at least 90% of our “REIT taxable income”, as defined by the Code, to our shareholders. We intend to meet our distribution requirements effective for 2018 as required by the Code.

Our Spin-Off from La Quinta Holdings Inc.

On January 18, 2017, La Quinta Holdings Inc., a Delaware corporation. (“LQH Parent,” and together with its consolidated subsidiaries, “LQH”) announced its intention to pursue the possibility of separating its real estate business from its franchise and management business, including the spin-off of its real estate ownership business into an independent, publicly traded company. The spin-off of CorePoint Lodging was made as part of a plan approved by LQH Parent’s board of directors to spin off LQH’s real estate business into a stand-alone, publicly traded company prior to the merger of LQH Parent with a wholly owned subsidiary of Wyndham Worldwide Corporation, a Delaware corporation (“Wyndham Worldwide”). The completion of the spin-off, followed by the completion of the merger, occurred on May 30, 2018. For additional discussion of the spin-off and related transactions, see Note 3.

Notwithstanding the legal form of the spin-off, for accounting and financial reporting purposes, LQH Parent is presented as being spun-off from CorePoint (a “reverse spin”). This presentation is in accordance with generally accepted accounting principles in the U.S. (“GAAP”), specifically Financial Account Standards Board (“FASB”) statement “Spinoff and Reverse Spinoffs”, and is primarily a result of the relative significance of CorePoint’s business to LQH’s business, as measured in terms of revenues, profits, and assets. Therefore, CorePoint Lodging Inc. is considered the divesting entity and treated as the “accounting successor,” and LQH Parent is the “accounting spinnee” and “accounting predecessor” for consolidated financial reporting purposes.

In accordance with FASB statement “Presentation of Financial Statements – Discontinued Operations”, effective with the closing of the spin-off on May 30, 2018, the results of operations related to LQH Parent’s hotel franchise and hotel management business are reported as discontinued operations for all periods presented. In addition, the assets and liabilities of LQH Parent’s hotel franchise and hotel management business have been segregated from the assets and liabilities related to the Company’s continuing operations and presented separately on the Company’s comparative balance sheet as of December 31, 2017. Unless otherwise noted, all disclosures in the notes accompanying the unaudited consolidated financial statements reflect only continuing operations.

9

Interim Unaudited Financial Information

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP for interim financial information, the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information or footnotes required by GAAP for complete annual financial statements. Although we believe the disclosures made are adequate to prevent the information presented from being misleading, these financial statements should be read in conjunction with LQH’s consolidated financial statements and notes thereto for the years ended December 31, 2017, 2016 and 2015, which are included in our Information Statement filed as Exhibit 99.1 to our Registration Statement on Form 10 (the “Form 10”), which the Securities and Exchange Commission (the “SEC”)  declared effective on May 8, 2018.

Subsequent to May 30, 2018, the accompanying unaudited condensed consolidated financial statements include the accounts of the Company. The historical unaudited condensed consolidated financial statements through May 30, 2018 represent the financial position and results of operations of entities that have historically been under common control of the accounting predecessor, LQH Parent.

The results for the interim periods shown in this report are not necessarily indicative of future financial results. The accompanying condensed consolidated balance sheet as of June 30, 2018 and condensed consolidated statements of operations, comprehensive income, cash flows and equity for the periods ended June 30, 2018 and 2017 have not been audited by our independent registered public accounting firm. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, including normal recurring items, necessary to present fairly our consolidated financial position as of June 30, 2018 and December 31, 2017, and our consolidated results of operations and cash flows for the periods ended June 30, 2018 and 2017.

The accompanying condensed consolidated financial statements include the accounts of the Company, as well as its wholly-owned subsidiaries and any consolidated variable interest entities (“VIEs”).  We recognize noncontrolling interests for the proportionate share of operations for ownership interests not held by our shareholders. All intercompany transactions have been eliminated.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.

Reclassifications

Certain line items on the condensed consolidated balance sheet as of December 31, 2017 and the condensed consolidated statements of operations for the three and six months ended June 30, 2017 have been reclassified to conform to the current period presentation. These reclassifications had no impact on our net income (loss) or financial position and were made in order to conform to presentations consistent with other REIT peers and reflect the results of discontinued operations. See Note 3 for additional information.

NOTE 2. SIGNIFICANT ACCOUNTING POLICIES AND RECENTLY ISSUED ACCOUNTING STANDARDS

Investment in Real Estate

Property and equipment are stated at cost less accumulated depreciation computed using a straight-line method over the estimated useful life of each asset. Property and equipment consists of the following, along with associated estimated useful lives:

Buildings and improvements	5 to 40 years
Furniture, fixtures and other equipment	2 to 10 years

We periodically review the useful lives of our long-lived assets based on current assessments of the remaining utility of our assets. Such changes are accounted for prospectively and would either increase or decrease depreciation expense in the accompanying condensed consolidated statements of operations.

10

We capitalize expenditures that increase the overall value of an asset or extend an asset’s life, typically associated with hotel refurbishment, renovation, and major repairs. Such costs primarily include third party contract labor, professional design and construction costs, including associated materials, and other direct and indirect costs, such as sales and use tax and interest costs, incurred during the redevelopment and renovation period. The capitalization period begins when the activities related to development have begun and ceases when the project is substantially complete and the assets are held available for use or occupancy. Once a redevelopment project is substantially complete and the associated assets are ready for intended use, costs related to the redevelopment project are no longer capitalized.

Normal maintenance and repair costs are expensed as incurred. When depreciable property is retired or disposed, the related cost and accumulated depreciation or amortization is removed from theapplicable accounts and any gain or loss is reflected in the accompanying statements of operations.  

Impairment of Real Estate Related Assets

If events or circumstances indicate that the carrying amount of a property may not be recoverable, we make an assessment of the property’s recoverability by comparing the carrying amount of the asset to our estimate of the aggregate undiscounted future operating cash flows expected to be generated over the holding period of the asset including its eventual disposition.  If the carrying amount exceeds the aggregate undiscounted future operating cash flows, we recognize an impairment loss to the extent the carrying amount exceeds the estimated fair value of the property. 

We did not record any impairment loss for the three and six months ended June 30, 2018 and 2017.

Assets Held for Sale

For sales of real estate or assets classified as held for sale, we evaluate whether the disposition will have a major effect on our operations and financial results and will therefore qualify as a strategic shift. If the disposition represents a strategic shift, it will be classified as discontinued operations in our consolidated statements of operations for all periods presented. If the disposition does not represent a strategic shift, it will be presented in continuing operations in our consolidated statements of operations.

We classify hotels as held for sale when certain criteria are met, in accordance with GAAP. At that time, we present the assets and obligations associated with the real estate held for sale separately in our consolidated balance sheet, and we cease recording depreciation and amortization expense related to that asset. Real estate held for sale is reported at the lower of its carrying amount or its estimated fair value less estimated costs to sell.

As of June 30, 2018 and December 31, 2017, we had two and three hotels held for sale, respectively.

Cash and Cash EquivalentsWe consider all cash on hand, demand deposits with financial institutions, and short-term highly liquid investments with original maturities of three months or less to be cash equivalents. Cash and cash equivalents consist of highly liquid investments that are stated at cost, which approximates fair market value. Certain balances in cash and cash equivalents exceed the Federal Deposit Insurance Corporation limit of $250,000; however, we believe credit risk related to these deposits is minimal.

Accounts Receivable

Accounts receivable primarily consists of receivables due from hotel guests, credit card companies and insurance settlements. Accounts receivable are carried at estimated collectable amounts. We periodically evaluate our receivables for collectability based on historical experience, the length of time receivables are past due, and the general economy. We provide an allowance for doubtful accounts, after considering factors that might affect the collection of accounts receivable, including historical losses and the ability of the party to meet its obligations to us.

Deferred Debt Issuance Costs

Deferred debt issuance costs include legal and bank issuance costs incurred in connection with issuance of debt, including costs associated with the issuance of our credit facilities, and are presented as a direct reduction from the carrying amount of debt. These debt issuance costs are deferred and amortized to expense over the term of the debt and are included as a component of interest expense. When debt is paid prior to its scheduled maturity date or the underlying terms are materially modified, the remaining carrying value of deferred debt issuance costs, along with certain other payments to lenders, is included in loss on early extinguishment of debt.

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Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or pay to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. In evaluating the fair value of both financial and non-financial assets and liabilities, we use the accounting guidance that establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair value into three broad levels, which are as follows:

• Level 1—Quoted prices in active markets for identical assets or liabilities.

• Level 2—Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Valuations in this category are inherently less reliable than quoted market prices due to the degree of subjectivity involved in determining appropriate methodologies and the applicable underlying observable market assumptions.

• Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. These inputs cannot be validated by readily determinable market data and generally involve considerable judgment by management.

We use the highest level of observable market data if such data is available without undue cost and effort.

Derivative Instruments

We use derivative instruments as part of our overall strategy to manage our exposure to market risks associated with fluctuations in interest rates. We regularly monitor the financial stability and credit standing of the counterparties to our derivative instruments. We do not enter into derivative financial instruments for trading or speculative purposes.

We record all derivatives at fair value. On the date the derivative contract is entered, we designate the derivative as one of the following: a hedge of a forecasted transaction or the variability of cash flows to be paid (“cash flow hedge”), a hedge of the fair value of a recognized asset or liability (“fair value hedge”), or an undesignated hedge instrument. Changes in the fair value of a derivative that is qualified, designated and highly effective as a cash flow hedge or net investment hedge are recorded in the condensed consolidated statements of comprehensive income (loss) until they are reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Changes in the fair value of a derivative that is qualified, designated and highly effective as a fair value hedge, along with the gain or loss on the hedged asset or liability that is attributable to the hedged risk, are recorded in current period earnings. Cash flows from designated derivative financial instruments are classified within the same category as the item being hedged in the condensed consolidated statements of cash flows.

On a quarterly basis, we assess the effectiveness of our designated hedges in offsetting the variability in the cash flows or fair values of the hedged assets or obligations via use of a statistical regression and hypothetical derivative approach. We discontinue hedge accounting prospectively when the derivative is not highly effective as a hedge, the underlying hedged transaction is no longer probable, or the hedging instrument expires, is sold, terminated or exercised.

Revenue Recognition

We adopted Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers, effective January 1, 2018 using the modified retrospective transition method. The information in this section describes our current revenue recognition policies. See “Newly Adopted Accounting Standards” below for additional information related to the adoption.

Our revenues primarily consist of operating lease revenues from room rentals, and, to a lesser extent, restaurants, billboards and cell towers, which are accounted for under GAAP in accordance with lease accounting standards. Room revenue is recognized as earned on a daily basis, net of customer incentive discounts, cash rebates, and refunds.  Revenue related to operating leases with a term in excess of one year are recognized on a straight-line basis over the life of the respective lease agreement.  

Other revenues include revenues generated by the incidental support of hotel operations for hotels and are recognized under the revenue accounting standard as the service obligation is completed.

Equity-Based Compensation

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We have a stock-based incentive award plan for our employees and directors. Stock-based compensation expense associated with these awards is recognized in general and administrative expenses in our consolidated statements of operations. We measure stock-based compensation at the estimated fair value on the grant date and recognize the amortization of stock-based compensation expense over the requisite service period. Fair value is determined based on grant date fair value.  We recognize forfeitures as they occur.

Income Taxes

We are organized in conformity with, and operate in a manner that will allow us to elect to be taxed as, a REIT, for U.S. federal income tax purposes beginning with our tax year ending December 31, 2018 and we expect to continue to be organized and operate so as to qualify as a REIT. To qualify as a REIT, we must continually satisfy requirements related to, among other things, the real estate qualification of sources of our income, the real estate composition and values of our assets, the amounts we distribute to our stockholders annually and the diversity of ownership of our stock. To the extent we qualify as a REIT, we generally will not be subject to U.S. federal income tax on taxable income generated by our REIT activities that we distribute to our stockholders. Accordingly, no provision for U.S. federal income taxes has been included in our accompanying condensed consolidated financial statements for purposes of determining the annualized effective tax rate applied to the six months ended June 30, 2018 related to our REIT activities.

We are, and will continue to be, subject to U.S. federal income tax on taxable sales of built-in gain property (representing property with an excess of fair value over tax basis held by us on May 30, 2018) during the five-year period following our election to be taxed as a REIT. In addition, we may be subject to state and local taxes and non-U.S. income tax on foreign held REIT activities. Further, our taxable REIT subsidiaries are generally subject to U.S. federal, state and local, and foreign income taxes (as applicable).

Through May 30, 2018, LQH Parent will file a federal income tax return, as well as certain state tax returns where we filed on a combined basis, and foreign tax filings, as applicable.

On December 22, 2017, the Tax Cuts and Jobs Act (the “Tax Act”) was enacted into law. The Tax Act contains several key tax provisions that affected us, including a reduction of the corporate income tax rate to 21% effective January 1, 2018, among others. We are required to recognize the effect of the tax law changes in the period of enactment, such as re-measuring our U.S. deferred tax assets and liabilities as well as reassessing the net realizability of our deferred tax assets and liabilities. In December 2017, the SEC staff issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (SAB 118), which allows us to record provisional amounts during a measurement period not to extend beyond one year of the enactment date. Since the Tax Act was passed late in the fourth quarter of 2017, and ongoing guidance and accounting interpretation is expected over the next 12 months, we consider the deferred tax re-measurements and other items to be incomplete due to the forthcoming guidance and our ongoing analysis of final year-end data and tax positions. We expect to complete our analysis within the one year measurement period permitted by SAB 118.

Concentrations of Credit Risk and Business Risk

Financial instruments, which potentially subject us to concentrations of credit risk, consist principally of cash and cash equivalents. We utilize financial institutions that we consider to be of high credit quality and consider the risk of default to be minimal. We also monitor the credit-worthiness of our customers and financial institutions before extending credit or making investments.

Lodging operations are particularly sensitive to adverse economic and competitive conditions and trends, which could adversely affect the Company’s business, financial condition, and results of operations.

Geographic concentrations, which potentially subject us to concentrations of business risk, relate primarily to locations of hotels and the revenue recognized in various states within the U.S. We have a concentration of hotels operating in Texas, Florida and California.

The percentages of our total revenues, excluding revenue from discontinued operations, from these states for the six months ended June 30, 2018 and 2017 are as follows:

	For the six months ended
	June 30, 2018			June 30, 2017
Texas		23	%		21	%
Florida		15	%		19	%
California		10	%		10	%
Total		48	%		50	%

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Segment Reporting

Our hotels have similar economic characteristics and customers across all geographic locations, and our service offerings and delivery of services are provided in a similar manner, using the same types of facilities and similar technologies. Our chief operating decision maker, the Company's Chief Executive Officer, reviews our financial information on an aggregated basis. As a result, we have concluded that we have one reportable business segment.

Principal Components of Expenses

Rooms — These expenses include hotel expenses of housekeeping, reservation systems, room and breakfast supplies and front desk costs.

Other departmental and support— These expenses include labor and other expenses that constitute non-room operating expenses, including parking, telecommunications, on-site administrative departments, sales and marketing, recurring repairs and maintenance and utility expenses.

Property tax, insurance and other— These expenses consist primarily of real and personal property taxes, other local taxes, ground rent, equipment rent and insurance.

Management and royalty fees — Management fees represent fees paid to third parties and are computed as a percentage of gross revenue.  Royalty fees are generally computed as a percentage of rooms revenues. In connection with the spin-off, we entered into new management and franchise agreements, refer to Note 9, “Commitments and Contingencies” for additional information.

Corporate general and administrative — These expenses include off-site general and administrative expenses, consisting primarily of compensation, contract labor expense for our corporate staff, professional fees, travel expenses, and office administrative and related expenses.  

Other, net — These expenses include losses incurred resulting from property damage or destruction caused by any sudden, unexpected or unusual event such as a hurricane. Impairment losses are non-cash expenses that are recognized when circumstances indicate that the carrying value of a long-lived asset is not recoverable. An impairment loss is recognized for the excess of the carrying value over the fair value of the asset.

Newly Issued Accounting Standards

In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements. This guidance updates ASU 2016-02 Leases and provides entities an additional, optional transition method of initially applying the new lease standard at the adoption date and recognizing cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption, with comparative periods continuing to be presented in accordance with current GAAP. Previously, ASU 2018-02 required the new standard to be adopted on a modified retrospective basis. The Company is currently evaluating which option to elect.

In June 2018, the FASB issued ASU 2018-07, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income, which simplifies the accounting for share-based payments granted to nonemployees for goods and services. Under this ASU, most of the guidance on such payments to nonemployees would be aligned with the requirements for share-based payments granted to employees. The Company accounts for its share-based payments to members of its board of directors in the same manner as share-based payments to its employees. Other than to members of our board of directors, the Company does not award share-based payments to any nonemployees. The guidance is effective for periods beginning after December 15, 2018. Early adoption is allowed.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which changes the methodology for measuring credit losses on financial instruments and the timing of when such losses are recorded. The guidance affects entities holding financial assets and net investment in leases that are not accounted for at fair value through net income. The guidance will apply to our trade receivables, notes receivable, net investments in leases and any other future financial assets that have the contractual right to receive cash that we may acquire in the future. The guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019. Early adoption is permitted for fiscal years, and interim periods within those years, beginning after December 15, 2018. Historically, credit losses have not been material to the Company. We are currently evaluating the impact of this guidance on our financial position, results of operations and related

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disclosures but do not expect the implementation of this guidance to have a material impact on our condensed consolidated financial position and results of operations.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), regarding the accounting for leases for both lessees and lessors. In July 2018, ASU 2016-02 was amended, providing another transition method by allowing companies to initially apply the new lease standard in the year of adoption and not the earliest comparative period. The lease standard amendment also provided a practical expedient for an accounting policy election for lessors, by class of underlying asset, to not separate nonlease components from the associated lease components, similar to the practical expedient provided for lessees. The lessor practical expedient is only available if the timing and pattern of transfer are the same for the nonlease and lease components and the lease components, if accounted for separately, would be classified as an operating lease.

Lessees will need to recognize on their balance sheet a right-of-use asset and a lease liability for virtually all of their leases (other than leases that meet the definition of a short-term lease). The liability will be equal to the present value of lease payments. The asset will be based on the liability, adjusted for any initial direct costs of the lease, lease incentives or early lease payments, where applicable. For income statement purposes, the FASB retained a dual model, requiring leases to be classified as either operating or finance. Operating leases will result in straight-line rent expense (similar to current operating leases) while finance leases will result in interest and amortization expense (similar to current capital leases). Classification will be based on criteria that are largely similar to those applied in current lease accounting. The new standard may be adopted using a modified retrospective transition and provides for certain practical expedients. We are evaluating the impact of ASU 2016-02 on our consolidated financial statements, where we believe the primary impact as a lessee will relate to leases where we are the ground lessee.

Under current lessor accounting, a real estate lease could only be a sales-type lease if ownership of the real estate was transferred to the lessee. With the adoption of ASU 2016-02, there will no longer be an exclusion for real estate leases, where the same classification guidance applies as with all other leases. We are currently evaluating how this guidance would apply to lessor classification. If, as lessor, our real estate leases would be classified as sales-type leases, the real estate asset would be eliminated, a net investment asset would be recognized generally equal to the present value of the minimum lease payments plus the unguaranteed residual value and a selling profit or loss recorded. Additionally, only incremental direct leasing costs may be capitalized under this new guidance, which is primarily consistent with the Company’s existing policies.

In light of the recently issued lease standard amendment and the new practical expedients, we continue to evaluate the impact of the new leasing standard. We plan to adopt the new standard effective January 1, 2019.

Newly Adopted Accounting Standards

Effective January 1, 2018, we adopted FASB Topic 606. The revised guidance outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and superseded prior revenue recognition guidance, including industry-specific revenue guidance.  The revised guidance replaced most existing revenue and real estate sale recognition guidance in GAAP. The standard specifically excludes lease contracts, which is our primary recurring revenue source; however, our revenue accounting for incidental hotel revenue will follow the revised guidance. We adopted the new standard using the modified retrospective transition method, where financial statement presentations prior to the date of adoption are not adjusted. Transactions that were not closed as of the adoption date were adjusted to reflect the new standard where we recorded a net reduction to opening retained earnings of approximately $15 million, net of tax, as of January 1, 2018 due to the cumulative impact of adopting ASC 606, which relates primarily to our discontinued operations.

Effective January 1, 2018, we adopted FASB ASU 2017-05, which requires the derecognition of a business in accordance with ASC 810, Consolidations, including instances in which the business is considered in substance real estate. In cases where a controlling interest in real estate was sold but a noncontrolling interest is retained, we may record a gain or loss related to both the sold and retained interests. The adoption of this standard did not have an impact on our condensed consolidated financial statements, but depending on future transactions, may in the future.

Effective January 1, 2018, we adopted FASB ASU 2018-05, Income Taxes (Topic 740) - Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118, which provides guidance from the SEC allowing for the recognition of provisional amounts in the financial statements as a result of the Tax Act that was signed into law in December 2017. The guidance allows for a measurement period of up to one year from the enactment date to finalize the accounting related to the Tax Act. The Company has applied and continues to apply the guidance in this update within its financial statements.

Effective January 1, 2018, we adopted FASB ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220). The guidance in ASU 2018-02 allows an entity to elect to reclassify the stranded tax effects related to the Tax Act from accumulated other

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comprehensive income into retained earnings. The adoption of this statement did not have a material effect on our financial statements.

Effective January 1, 2018, we adopted FASB ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting. This update clarifies the changes to terms or conditions of a share-based payment award that require an entity to apply modification accounting. The adoption of this statement did not have a material effect on our financial statements.

Effective January 1, 2018 we adopted FASB ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business, which provides guidance for evaluating whether certain transactions are to be accounted for as an acquisition (or disposal) of either a business or an asset. This standard is applied on a prospective basis.  The adoption of this statement did not have a material effect on our financial statements.

From time to time, new accounting standards are issued by FASB or other standards setting bodies, which we adopt as of the specified effective date. Unless otherwise discussed, we believe the impact of recently issued standards that are not yet effective will not have a material impact on our consolidated financial statements upon adoption.

NOTE 3. DISCONTINUED OPERATIONS

As discussed in Note 1, LQH Parent completed the separation of its real estate business, CorePoint, from the franchise and management business. The spin-off of CorePoint was made as part of a plan approved by LQH Parent’s board of directors to spin off LQH’s real estate business into a stand-alone, publicly traded company prior to the merger of LQH Parent with a wholly owned subsidiary of Wyndham Worldwide. To complete the spin-off, LQH Parent distributed to its stockholders all of the outstanding shares of CorePoint common stock. Each holder of LQH Parent common stock received one share of CorePoint common stock for each share of LQH Parent common stock held  by such holder as of 5:00 p.m., Eastern Time, on the record date, after giving effect to a reverse stock split, whereby each share of the common stock of LQH Parent (par value $0.01) was reclassified and combined into one half of a share of the common stock of LQH Parent (par value $0.02) (the “Reverse Stock Split”). Immediately following the spin-off, pursuant to the terms of the merger agreement LQH Parent became a wholly-owned subsidiary of Wyndham Worldwide and each share of LQH Parent common stock (after giving effect to the Reverse Stock Split) was converted into the right to receive $16.80 per share in cash (after giving effect to the Reverse Stock Split), without interest. The merger consideration is in addition to the shares of CorePoint common stock that the LQH Parent stockholders received in the distribution, as described above. Wyndham Worldwide repaid $715 million of LQH Parent’s debt net of cash and set aside a reserve of $240 million for estimated taxes expected to be incurred in connection with the spin-off. The completion of the spin-off, followed by the completion of the merger, occurred on May 30, 2018.

Immediately following the spin-off, LQH Parent did not own any shares of any class of CorePoint outstanding common stock. In connection with the spin-off, CorePoint had entered into a Separation and Distribution Agreement (the “Separation and Distribution Agreement”) in January 2018 and entered into several other agreements with LQH Parent prior to consummation of the spin-off. These agreements set forth the principal transactions required to effect CorePoint’s separation from LQH and provide for the allocation between CorePoint and LQH Parent of various assets, liabilities, rights and obligations (including employee benefits, intellectual property, insurance and tax-related assets and liabilities) and govern the relationship between CorePoint and LQH after completion of the spin-off. These agreements include, among others:

• an Employee Matters Agreement, dated January 7, 2018, between LQH and CorePoint, which governs certain obligations of LQH and CorePoint with respect to current and former LQH employees, including certain compensation and benefits obligations, the treatment of certain equity awards, and the allocation of certain employee-related assets and liabilities between LQH and CorePoint;

• a Tax Matters Agreement, dated May 30, 2018, between LQH and CorePoint, which governs LQH’s and CorePoint’s respective rights, responsibilities and obligations with respect to tax liabilities, tax attributes, the preparation and filing of tax returns, tax contests, and certain other tax matters, including a two-way adjustment to the extent LQH’s estimated tax liability as a result of the spin-off and related transactions is greater or less than an agreed-upon reserve amount set forth in the Tax Matters Agreement;

• Hotel Management Agreements and Franchise Agreements governing the ongoing relationship between LQH, as operator of CorePoint’s hotels, and CorePoint as the owner of such hotels; and

• a Transition Services Agreement, dated May 30, 2018, between LQH and CorePoint, pursuant to which each party will provide certain services to the other party for an interim period following the spin-off.

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Notwithstanding the legal form of the spin-off, for accounting and financial reporting purposes, LQH Parent is presented as being spun-off from CorePoint (a “reverse spin”). This presentation is in accordance with GAAP and is primarily a result of the relative significance of CorePoint’s business to LQH’s business, as measured in terms of revenues, profits, and assets. Therefore, CorePoint Lodging Inc. is considered the divesting entity and treated as the “accounting successor,” and LQH Parent is the “accounting spinnee” and “accounting predecessor” for financial reporting purposes.

In accordance with ASC 205-20 Presentation of Financial Statements – Discontinued Operations, effective with the closing of the spin-off on May 30, 2018, the results of operations related to the hotel franchise and hotel management business are reported as discontinued operations for all periods presented. In addition, the assets and liabilities of the hotel franchise and hotel management business have been segregated from the assets and liabilities related to the Company’s continuing operations and presented separately on the Company’s comparative balance sheet as of December 31, 2017.

Because the separation was a spin-off among shareholders, for financial statement presentation, there is no gain or loss on the separation of the disposed net assets and liabilities. Rather, the carrying amounts of the net assets and liabilities of the Company’s former hotel franchise and hotel management accounts are removed at their historical cost with an offsetting amount to stockholders’ equity. As of June 30, 2018, the Company recorded a $746 million adjustment in stockholders’ equity from the spin-off. The amount recognized will be impacted in future reporting periods as the amount recorded is preliminary pending the finalization of various items including the final determination of the tax liabilities associated with the transaction and the settlement of other remaining considerations with Wyndham Worldwide. As these matters are finalized pursuant to the transaction agreements, the Company will record an adjustment to its cash balance with an offsetting amount to stockholders’ equity. Additionally, as the spin-off was a taxable spin, Wyndham Worldwide reserved $240 million to cover the tax payment for the spin transaction.  Any residual amount of the reserve above the tax payment will be remitted to the Company. As these tax valuations are completed and the estimates are refined and finalized, the impact of the reorganization and separation from La Quinta Holdings Inc. on stockholders’ equity will be adjusted.

Results of Discontinued Operations

The following table summarizes the results of the hotel franchise and hotel management business which are presented as discontinued operations (in millions).

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2018			2017			2018			2017
Revenues	$	25		$	38		$	58		$	69
OPERATING EXPENSES
General, administrative and marketing		36			30			64			58
Depreciation and amortization		2			2			4			4
Total Operating Expenses		38			32			68			62
Operating Income (Loss)		(13	)		6			(10	)		7
OTHER EXPENSES:
Interest expense		(6	)		(9	)		(15	)		(17	)
Loss on extinguishment of debt		(7	)		—			(7	)		—
Total Other Expenses		(13	)		(9	)		(22	)		(17	)
Loss Before Income Taxes		(26	)		(3	)		(32	)		(10	)
Income tax benefit		6			1			7			4
Loss from Discontinued Operations, net of tax	$	(20	)	$	(2	)	$	(25	)	$	(6	)

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The following table presents the carrying amounts of the major classes of assets and liabilities of LQH Parent that were included in discontinued operations as of December 31, 2017:

	December 31, 2017
	(in millions)
ASSETS
Assets:
Total real estate, net	$	49
Intangible assets, net of accumulated amortization		171
Accounts receivable		24
Other assets		36
Total Assets	$	280
LIABILITIES AND EQUITY
Liabilities:
Debt, net	$	696
Accounts payable and accrued expenses		109
Other liabilities		21
Deferred tax liabilities		20
Total Liabilities	$	846

In connection with the spin-off, CorePoint made a cash payment to LQH Parent of approximately $1.002 billion (the “Cash Payment”), immediately prior to and as a condition of the spin-off. The Cash Payment was to facilitate the repayment of part of LQH Parent’s existing debt. In addition, simultaneously with the closing of the merger, Wyndham Worldwide repaid, or caused to be repaid, on behalf of LQH Parent, LQH Parent’s existing Term Facility (as defined below).

As permitted under GAAP, the Company has elected not to adjust the condensed consolidated statements of cash flows for the six months ended June 30, 2018 and June 30, 2017 to exclude cash flows attributable to discontinued operations. As such, the following table presents selected financial information of LQH Parent included in the condensed consolidated statements of cash flows:

	For the Six months ended June 30,
	June 30, 2018		June 30, 2017
	(in millions)
Non-cash items included in net income (loss):
Depreciation and amortization	$	4	$	4
Amortization of deferred costs		1		1
Loss on extinguishment of debt		7		—
Equity based compensation expense		4		4
Investing activities:
Capital expenditures	$	11	$	12

NOTE 4. INVESTMENTS IN REAL ESTATE

Depreciation and amortization expense related to property and equipment was $39 million and $34 million for the three months ended June 30, 2018 and 2017 respectively. Depreciation and amortization expense related to property and equipment was $76 and $68 million for the six months ended June 30, 2018 and 2017, respectively. Construction in progress includes capitalized costs for ongoing projects that have not yet been put into service.

NOTE 5. OTHER ASSETS

Other assets include the following as of June 30, 2018 and December 31, 2017:

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	June 30, 2018		December 31, 2017
	(in millions)
Assets held for sale	$	5	$	9
Lenders escrow		15		—
Intangible assets		5		5
Other assets		30		18
Total other assets	$	55	$	32

As of December 31, 2017, three hotels were classified as assets held for sale. The sale of these assets does not represent a major strategic shift and does not qualify for discontinued operations reporting. During the first quarter of 2018, one of these hotels was sold for $4 million, net of transaction costs, resulting in a gain of $1 million. Subsequent to the end of the second quarter of 2018, one of these hotels was sold for $2 million, net of transaction costs. The remaining hotel is expected to be sold before the end of 2018.

NOTE 6.  DEBT

Debt as of June 30, 2018 and December 31, 2017 was as follows:

	June 30, 2018			December 31, 2017
	(in millions)
CMBS Facility	$	1,035		$	—
Revolving Facility		25			—
Term Facility		—			1,003
		1,060			1,003
Less deferred debt issuance costs and original issue discount		(28	)		(11	)
Total debt, net (1)	$	1,032		$	992

⁽¹⁾ As of June 30, 2018 and December 31, 2017, the 30 day United States dollar London Interbank Offering Rate (“LIBOR”) was 2.09% and 1.56%, respectively. As of June 30, 2018, the interest rate, maturity date and principal payments on the CMBS Facility (as defined below) and Term Facility (defined below) were as follows:

• The interest rate for the CMBS Facility through June 30, 2018 was LIBOR with a floor of 0.0% plus a spread of 2.75%. Interest expense on the CMBS Facility for the three and six months ended June 30, 2018 was approximately $6 million. Included in the CMBS Facility, as of June 30, 2018 is the deduction of debt issuance costs of $28 million, net of amortization. As of June 30, 2018, we had $5 million in accrued interest included within accounts payable and accrued expenses in the accompanying condensed consolidated balance sheet.

• The interest rate for the Revolving Facility is, at the option of the CorePoint Revolver Borrower, either at a base rate plus a margin of 3.5% or LIBOR rate plus a margin of 4.5%.

• In connection with the consummation of the merger, on May 30, 2018, all outstanding amounts under the Term Facility were repaid in full.

• The interest rate for the Term Facility from January 1, 2018 to March 6, 2018, was LIBOR with a floor of 1.0% plus a spread of 2.75%. As of March 6, 2018, the rate increased to LIBOR with a floor of 1.0% plus a spread of 3.0% for the period from March 6, 2018 to May 30, 2018. Included in the Term Facility as of December 31, 2017 is an unamortized original issue discount of $3 million. Interest expense on the Term Facility for the three and six months ended June 30, 2018 was approximately $8 million and $19 million, respectively. Interest expense on the Term Facility for the three and six months ended June 30, 2017 was approximately $10 million and $21 million, respectively. Included in the Term Facility, as of December 31 ,2017 is the deduction of debt issuance costs of $8 million, net of amortization. As of December 31, 2017, we had $9 million in accrued interest included within accounts payable and accrued expenses in the accompanying condensed consolidated balance sheets.

Extinguishment of debt

In connection with the spin-off and merger, on May 30, 2018, we entered into the CMBS Loan Agreement and used the proceeds to repay or discharge existing loans (“Term Facility”) related to the properties covered by the facility.  During the six months ended June 30, 2018, we recorded a $10 million loss related to the extinguishment of the Term Facility. The losses included the write-off of unamortized debt issuance costs and original issuance discount.

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CMBS Facility

On May 30, 2018, certain indirect wholly-owned subsidiaries of CorePoint (collectively, the “CorePoint CMBS Borrower”), CorePoint TRS L.L.C (the “Operating Lessee”), and CorePoint Operating Partnership L.P. (the “CorePoint OP”) entered into a Loan Agreement (the “CMBS Loan Agreement”), pursuant to which the CorePoint CMBS Borrower borrowed an aggregate principal amount of $1.035 billion under a secured mortgage loan secured primarily by mortgages for 307 owned and ground leased hotels, an excess cash flow pledge for seven owned and ground leased hotels and other collateral customary for mortgage loans of this type (the “CMBS Facility”). The proceeds from the CMBS Facility were used to facilitate the repayment of part of LQH Parent’s existing debt. In addition, simultaneously with the closing of the merger, Wyndham repaid, or caused to be repaid, on behalf of LQH Parent, LQH Parent’s existing Term Facility. The CMBS Facility has an initial term of two years, with five extension options of twelve months each exercisable at the CorePoint CMBS Borrower’s election provided that CorePoint CMBS Borrower provide Lender at least 30 days’, but not more than 120 days’, notice, there is no event of default existing as of the commencement of the applicable extension period and the CorePoint CMBS Borrower either extends the current interest rate cap or purchases a new interest rate cap covering the extension period at a strike price as set forth in the CMBS Loan Agreement.

As long as LIBOR is able to be determined, the CMBS Facility bears interest at a rate equal to the sum of (i) one-month LIBOR (rounded to the nearest 1/1000th of a percent subject to a floor of 0.00%) and (ii) 2.75% per annum for the first 5 years of the term, 2.90% for the 6th year of the term and 3.00% for the 7th year of the term.  

The CMBS Facility is pre-payable in whole or in part subject to payment of (i) in the case of prepayments (other than in certain enumerated cases) made prior to or on the December 2019 payment date (provided that with respect to any prepayment made after the payment date in November 2019, but prior to the December 2019 payment date, the amount of the spread maintenance payment shall be zero), a spread maintenance premium and in certain cases third party LIBOR breakage costs, and (ii) all accrued interest through the date of prepayment prior to a securitization and through the end of the applicable accrual period following a securitization. Notwithstanding the above, the CorePoint CMBS Borrowers are permitted to prepay the CMBS Facility by an amount not to exceed 20% of the original principal balance of the CMBS Facility, in the aggregate without payment of any spread maintenance premium.

CorePoint OP delivered a customary non-recourse guaranty in connection with the CMBS Facility. Under such guaranty, (i) CorePoint OP will agree to indemnify the lender for certain losses arising out of customary “bad-boy” acts of CorePoint OP and its affiliates, including the CorePoint CMBS Borrower and (ii) the CMBS Facility will become fully recourse to CorePoint OP upon the occurrence of certain bankruptcy events capped at 10% of the then outstanding principal balance of the CMBS Facility. With respect to environmental matters, the CMBS Facility is recourse to the CorePoint CMBS Borrower only, provided that the required environmental insurance is delivered to the lender.

The CMBS Facility includes certain customary affirmative and negative covenants and events of default, including, among other things, restrictions on the ability of the CorePoint CMBS Borrower to incur additional debt and transfer, pledge or assign certain equity interests or its assets, and covenants requiring the CorePoint CMBS Borrower to exist as “special purpose entities,” maintain certain ongoing reserve funds and comply with other customary obligations for commercial mortgage-backed securities loan financings. As of June 30, 2018, the Company is in compliance with these covenants.

At the closing of the CMBS Facility, the CorePoint CMBS Borrower deposited in the loan servicer’s account approximately $15 million in upfront reserves for property improvement and environmental remediation, which funds may be periodically disbursed to the CorePoint CMBS Borrower throughout the term of the loan to cover such costs. In addition, revenues to be distributed to the CorePoint CMBS Borrower will be required to be deposited first into a segregated account under the control of the CMBS Facility lender (the “Clearing Account”). All cash in the Clearing Account will be transferred to an account under the control of the Operating Lessee as long as (i) there is no event of default under the loan or (ii) the debt yield for the CMBS Facility (calculated based on the outstanding principal balance of the CMBS Facility) does not fall below (x) 12.33% for the first five years of the CMBS Facility loan term or (y) 12.83% for the sixth and seventh years of the CMBS Facility loan term, in each case for two consecutive calendar quarters. Upon the occurrence and continuation of either (i) or (ii) above, all cash in the Clearing Accounts will be transferred to an account under the control of the lender to be applied to payment of all monthly amounts due under the CMBS Facility loan documents including, but not limited to, debt service for the CMBS Facility and the Revolving Facility, agent fees and expenses, required ongoing reserves, property operating expenses, sales and use taxes and custodial fees. The remaining funds will be deposited into an excess cash flow account, also under the control of the lender, which funds will be available to the CorePoint CMBS Borrower, provided there is no event of default under the loan for payment of, among other things, various operating expenses and dividends, distributions and redemptions sufficient to maintain certain tax-preferential treatment for the CorePoint CMBS Borrower.

As required by, and in connection with CorePoint Lodging’s entry into the CMBS Loan Agreement (defined below), we entered into an interest rate cap agreement on May 30, 2018 with a notional amount of $1.035 billion and a LIBOR rate cap of 3.25% that expires on July 15, 2020 (the “Interest Rate Cap Agreement”). The Interest Rate Cap Agreement is for a period equal to the existing term of

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the CMBS Facility and has a notional amount equal to or greater than the then outstanding principal balance of the CMBS Facility. The Company did not designate the interest rate cap as a hedge.

Revolving Facility

Also on May 30, 2018, the CorePoint Revolver Borrower and CorePoint OP entered into the Revolver Credit Agreement providing for the $150 million Revolving Facility, of which $25 million was drawn upon consummation of the spin-off. The Revolving Facility will mature on May 30, 2020, with an election to extend the maturity for one additional year subject to certain conditions, including that the maturity of the CMBS Facility be extended to a date no earlier than the maturity of the Revolving Facility.

The interest under the Revolving Facility will be, at the option of the CorePoint Revolver Borrower, either at a base rate plus a margin of 3.50% or a LIBOR rate plus a margin of 4.50%. With respect to base rate loans, interest will be payable at the end of each quarter. With respect to LIBOR loans, interest will be payable at the end of the selected interest period but no less frequently than quarterly. Additionally, there is a commitment fee payable at the end of each quarter equal to 0.50% of unused commitments under the Revolving Facility and customary letter of credit fees.

The Revolving Facility contains customary representations and warranties, affirmative and negative covenants and defaults. The Revolving Facility also contains a maximum total net leverage ratio financial covenant and minimum interest coverage ratio financial covenant, in each case, tested as of the last day of any fiscal quarter in which borrowings under the Revolving Facility and outstanding letters of credit exceed 10% of the aggregate commitments of the Revolving Facility. As of June 30, 2018, the Company is in compliance with these covenants.

The obligations under the Revolving Facility are unconditionally and irrevocably guaranteed by CorePoint OP, and, subject to certain exceptions, each of the CorePoint Revolver Borrower’s existing and future domestic subsidiaries that own equity interests in any CorePoint CMBS Borrower (collectively, the “Revolver Subsidiary Guarantors”). The CorePoint Revolver Borrower’s obligations under the Revolving Facility and any hedging or cash management obligations are secured by (i) a perfected first-lien pledge of all equity interests in the CorePoint Revolver Borrower, all equity interests in any Revolver Subsidiary Guarantor and, subject to certain exceptions, all equity interests in certain CorePoint CMBS Borrowers and (ii) a perfected first-priority security interest in the CorePoint Revolver Borrower’s conditional controlled deposit account.

NOTE 7.  PREFERRED STOCK

In connection with La Quinta’s internal reorganization prior to the spin-off, the Company issued 15,000 shares of Cumulative Redeemable Series A Preferred Stock, par value $0.01 per share (the “Series A preferred stock”), to La Quinta Intermediate Holdings, L.L.C., a wholly owned subsidiary of La Quinta. Such securities were issued in reliance on the exemption contained in Section 4(a)(2) of the Securities Act, as a transaction by an issuer not involving a public offering. La Quinta Intermediate Holdings, L.L.C. privately sold all of the Series A preferred stock to an unrelated third-party investor immediately prior to the completion of the spin-off.

On May 30, 2018, the Company filed with the State Department of Assessments and Taxation of Maryland Articles Supplementary (the “Articles Supplementary”) regarding certain rights of the shares of the Series A preferred stock. The Series A preferred stock has an aggregate liquidation preference of $15 million, plus any accrued and unpaid dividends thereon. We pay a cash dividend on the Series A preferred stock equal to 13% per annum, payable quarterly. If either our leverage ratio exceeds 7.5 to 1.0 as of the last day of any fiscal quarter, or if an event of default occurs (or has occurred and has not been cured) with respect to the Series A preferred stock, we will be required to pay a cash dividend on the Series A preferred stock equal to 15% per annum. Our dividend rate on the Series A preferred stock will increase to 16.5% per annum if, at any time, we are both in breach of the leverage ratio covenant and an event of default occurs (or has occurred and has not been cured) with respect to the Series A preferred stock. The Series A preferred stock are senior to our common stock with respect to dividends and with respect to dissolution, liquidation or winding up of the Company.

Holders of Series A preferred stock generally have no voting rights. However, the Articles Supplementary provided that, without the prior consent of the holders of a majority of the outstanding shares of Series A preferred stock, we are prohibited from (i) issuing any capital stock ranking senior to or on parity with the Series A preferred stock, (ii) authorizing or issuing any additional shares of Series A preferred stock, (iii) amending our charter in any manner that would adversely affect the Series A preferred stock, or (iv) entering into, amending or altering any provision of any agreement in a manner that could reasonably be expected to be material and adverse to the Series A preferred stock. The holders of the Series A preferred stock also have exclusive voting rights on any amendment to our charter that would alter the contract rights of only the Series A preferred stock. If we are either (a) in arrears on the payment of dividends that were due on the Series A preferred stock on six or more quarterly dividend payment dates, whether or not such dates are consecutive, or (b) in default of our obligations to redeem the preferred stock on the tenth anniversary of its issuance or following a change of control, the preferred shareholders may designate a representative to attend meetings of our board of directors as a non-

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voting observer until all unpaid preferred stock dividends have either been paid or declared with an amount sufficient for payment set aside for payment, or the shares required to be redeemed have been redeemed, as applicable.

The Series A preferred stock is mandatorily redeemable by us upon the tenth anniversary of the date of issuance. Beginning on the seventh anniversary of the issuance of the Series A preferred stock, we may redeem the outstanding Series A preferred stock for an amount equal to its aggregate liquidation preference, plus any accrued but unpaid dividends. The holders of the Series A preferred stock may also require us to redeem the Series A preferred stock upon a change of control of the Company for an amount equal to its aggregate liquidation preference plus any accrued and unpaid dividends thereon (and a premium if the change of control occurs prior to the seventh anniversary of the issuance of the Series A preferred stock).

Shares of the Series A preferred stock may not be transferred until the date that is six months after the date of issuance of the Series A preferred stock and then only in tranches having an aggregate liquidation value of at least $2.5 million.

On August 13, 2018, the Company filed with the State Department of Assessments and Taxation of Maryland Articles of Amendment (the “Articles of Amendment”) to the Articles Supplementary for the Series A preferred stock, to, among other things, remove the consent right of holders of shares of the Series A preferred stock over designations or issuances by us of any class or series of our stock ranking on parity with the Series A preferred stock, and instead provide such holders with certain preemptive rights over issuances of such parity stock. As required under the Articles Supplementary, the holders of a majority of the Series A preferred stock approved the Articles of Amendment. Due to the fact that the preferred stock is mandatorily redeemable by us, it is classified as a liability on the accompanying condensed consolidated balance sheet as of June 30, 2018. Dividends on these preferred shares are classified as interest expense in the accompanying condensed consolidated statements of operations.

NOTE 8. FAIR VALUE MEASUREMENTS

The carrying amount and estimated fair values of our financial assets and liabilities were as follows:

	June 30, 2018				December 31, 2017
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
	(in millions)
Debt - CMBS Facility(1)(2)	$	1,007	$	1,007	$	—	$	—
Debt - Revolver(1)		25		25		—		—
Interest rate caps (3)		1		1		—		—
Debt - Term Facility(1)(4)(2)		—		—		992		1,007
Interest rate swaps (3)		—		—		1		1
Mandatorily redeemable preferred shares(1)		15		15		—		—

⁽¹⁾ Classified as Level 3 under the fair value hierarchy.

⁽²⁾ Carrying amount includes deferred debt issuance costs of $28 million as of June 30, 2018.

⁽³⁾ Classified as Level 2 under the fair value hierarchy.

⁽⁴⁾ Carrying amount includes deferred debt issuance costs of $14 million as of December 31, 2017.

We believe the carrying amounts of our cash and cash equivalents and lenders escrow approximated fair value as of June 30, 2018 and December 31, 2017, as applicable. Our estimates of the fair values were determined using available market information and valuation methods appropriate in the circumstances.

Considerable judgment is necessary to interpret market data and develop estimated fair values. Proper placement of fair value measurements within the valuation hierarchy is considered each reporting period. The use of different market assumptions or estimation methods may have a material effect on the estimated fair value amounts.

The fair values of interest rate swaps and interest cap are determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each instrument. This analysis reflects the contractual terms of the agreements, including the period to maturity, and uses observable market-based inputs, including forward interest rate curves. We incorporate credit valuation adjustments to appropriately reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements.

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We estimate the fair value of our debt and mandatorily redeemable preferred stock by using discounted cash flow analysis based on current market inputs for similar types of arrangements. The primary sensitivity in these calculations is based on the selection of appropriate discount rates. Fluctuations in these assumptions will result in different estimates of fair value.

NOTE 9. COMMITMENTS AND CONTINGENCIES

Hotel Management and Operating License Agreements

Management Fees

On May 30, 2018, the Company entered into management agreements with La Quinta Management L.L.C (“LQM”), whereby it pays a fee equal to 5% of total gross revenues, as defined, which is classified as management and royalty fees in the accompanying condensed consolidated statements of operations.

LQM generally has sole responsibility for all activities necessary for the operation of the hotels, including establishing room rates, processing reservations and promoting and publicizing the hotels. LQM also provides all employees for the hotels, prepares reports, budgets and projections, and provides other administrative and accounting support services to the hotels. We have consultative and limited approval rights with respect to certain actions of LQM, including entering into long-term or high value contracts, engaging in certain actions relating to legal proceedings, approving the operating budget, making certain capital expenditures and the hiring of certain management personnel. We are also responsible for reimbursing LQM for certain costs incurred by LQM during the fulfillment of their duties, such as payroll costs for certain employees and other costs that the manager incurs to operate the hotels.  The term of the management agreements is 20 years, subject to two renewals of five years each, at the LQM’s option.

Franchise Fees

In connection with the spin-off, we entered into franchise agreements with La Quinta Franchising LLC (“LQ Franchising”). Pursuant to the franchise agreements, we were granted a limited, non-exclusive license to use our franchisor’s brand names, marks and system in the operation of our hotels. The franchisor also may provide us with a variety of services and benefits, including centralized reservation systems, participation in customer loyalty programs, national advertising, marketing programs and publicity designed to increase brand awareness, as well as training of personnel. In return, we are required to operate franchised hotels consistent with the applicable brand standards. As of June 30, 2018, 315 of our franchise agreements were with LQ Franchising. In the second quarter of 2018, one hotel transitioned to a Baymont branded hotel.

Our franchise agreements require that we pay a 5% royalty fee on gross rooms revenue. The royalty fee is included within management and royalty fees in the accompanying condensed consolidated statements of operations. The term of the franchise agreements is 20 years from the opening date, subject to one renewal of ten years, at the franchisor’s option.

In addition to the royalty fee, the LQ Franchising agreement includes a reservation fee of 2% of gross room revenues, a marketing fee of 2.5% of gross room revenues, a loyalty program fee of 5% of eligible room night revenue, and other miscellaneous ancillary fees.  The Baymont franchise agreement includes a reservation fee of 1.5% of gross room revenues, a marketing fee of 2% of gross room revenues, a loyalty program fee of 5% of eligible room night revenue, and other miscellaneous ancillary fees.  Reservation fees are included within room expense in the accompanying condensed consolidated statements of operations.  The marketing fee and loyalty program fees are included within other departmental and support in the accompanying condensed consolidated statements of operations.  

Litigation

We are a party to a number of pending claims and lawsuits arising in the normal course of business, including proceedings involving tort and other general liability claims, workers’ compensation and other employee claims and intellectual property claims. We do not consider our ultimate liability with respect to any such claims or lawsuits, or the aggregate of such claims and lawsuits, to be material in relation to our condensed consolidated financial condition, results of operations or our cash flows taken as a whole.

We maintain general and other liability insurance; however, certain costs of defending lawsuits, such as those below the retention or insurance deductible amount, are not covered by or are only partially covered by insurance policies, and our insurance carriers could refuse to cover certain claims in whole or in part. We regularly evaluate our ultimate liability costs with respect to such claims and lawsuits. We accrue costs from litigation as they become probable and estimable.

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Tax Contingencies

We are subject to regular audits by federal and state tax authorities. These audits may result in additional tax liabilities. The Internal Revenue Service (“IRS”) is currently auditing the tax returns of La Quinta Corporation, one of our former REITs, and BRE/LQ Operating Lessee Inc., one of our former taxable REIT subsidiaries, in each case for the tax years ended December 31, 2010 and 2011. We received a draft notice of proposed adjustment from the IRS on January 9, 2014, and the notice of proposed adjustment was issued to us on June 2, 2014. We submitted a timely response to the notice of proposed adjustment and, on July 7, 2014, we received an IRS 30-Day Letter proposing to impose a 100% tax on the REIT totaling $158 million for the periods under audit in which the IRS has asserted that the rent charged for these periods under the lease of hotel properties from the REIT to the taxable REIT subsidiary exceeded an arm’s length rent. In addition, the IRS proposed to eliminate $89 million of net operating loss carryforwards for the taxable REIT subsidiary for the tax years 2006 through 2009; however, in an IRS rebuttal received on September 26, 2014, the IRS conceded its proposed adjustment on this point was incorrect. We disagree with the IRS’ position with respect to rents charged by the REIT to its taxable REIT subsidiary and have appealed the proposed tax and adjustments to the IRS Appeals Office. In determining amounts payable by our taxable REIT subsidiary under the lease, we engaged a third party to prepare a transfer pricing study contemporaneous with the lease which concluded that the lease terms were consistent with an arm’s length rent as required by relevant provisions of the Code and applicable Treasury Regulations. Attorneys and others representing the Company conducted preliminary discussions regarding the appeal with the IRS Appeals Office team on March 31, 2015 and April 1, 2015. In response to a supplemental analysis submitted by the IRS economist to IRS Appeals Office and provided to us on August 18, 2015, we submitted responses dated September 3, 2015 and October 1, 2015.  

Our most recent meeting with the IRS Appeals Office team occurred on January 25, 2017. In November 2017, IRS Appeals returned the matter to IRS Examination for further factual development. We believe the IRS transfer pricing methodologies applied in the audits contain flaws and that the IRS proposed tax and adjustments are inconsistent with the U.S. federal tax laws related to REITs. We have concluded that the positions reported on our tax returns under audit by the IRS are, based on their technical merits, more-likely-than-not to be sustained upon examination. Accordingly, as of June 30, 2018, we have not established any reserves related to this proposed adjustment or any other issues reflected on the returns under examination. If, however, we are unsuccessful in challenging the IRS, an excise tax would be imposed on the REIT equal to 100% of the excess rent and we could owe additional income taxes, interest and penalties, which could adversely affect our financial condition, results of operations and cash flow and the price of our common stock. Such adjustments could also give rise to additional state income taxes.

On November 25, 2014, we were notified that the IRS intended to examine the tax returns of the same entities subject to the 2010 and 2011 audit in each case for the tax years ended December 31, 2012 and 2013.  We have received several draft notices of proposed adjustment proposing a transfer-pricing related assessment of approximately $18 million for 2013 and adjustments to our net operating losses for the years 2006 through 2009.  The IRS has since indicated that it will not pursue the transfer-pricing adjustment. On August 8, 2017, the IRS issued a 30-Day Letter, in which it is proposed to disallow net operating loss carryovers originating in tax years 2006-2011 or, in the alternative, tax years 2006-2009, depending upon the outcome of the 2010-2011 examination discussed above. On September 26, 2017, we furnished a timely protest to the IRS exam team. They have since indicated that they intend to furnish a rebuttal to our protest, at which time the matter will be referred to the IRS Appeals Office. Based on our analysis of the NOL notice, we believe the IRS NOL disallowances applied in the 2012-2013 audit contain the same flaws present in the 2010-2011 audit and that the IRS proposed NOL adjustments are inconsistent with the U.S. federal tax laws related to REITs.  We have concluded that the positions reported on our tax returns under audit by the IRS are, based on their technical merits, more-likely-than-not to be sustained upon examination. Accordingly, as of June 30, 2018, we have not established any reserves related to this proposed adjustment or any other issues reflected on the returns under examination.

Purchase Commitments

As of June 30, 2018, we had approximately $19 million of purchase commitments related to certain continuing redevelopment and renovation projects and other commitments.

NOTE 10. INCOME TAXES

The Company intends to elect REIT status with the filing of its tax return for the period May 31, 2018 through December 31, 2018.  To qualify as a REIT, the Company must meet a number of organizational, operational, and distribution requirements. As a REIT, the Company is generally not subject to federal corporate income taxes on the portion of its net income that is currently distributed to its shareholders. To the extent the Company does not distribute 100% of its taxable income for any year in which it has elected REIT status, the Company will be subject to income tax on the undistributed taxable income.  It is the Company’s current intention to adhere to these requirements and maintain the Company’s qualification for taxation as a REIT, including the requirement to distribute its taxable income. If the Company fails to qualify for taxation as a REIT in any taxable year, it will be subject to federal income taxes at regular corporate rates and may not be able to qualify as a REIT for the four taxable years subsequent to the year of an uncured REIT

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qualification failure. Even if the Company qualifies for taxation as a REIT, the Company may be subject to certain state and local taxes on its income and property, and to federal income and excise taxes on its undistributed taxable income. In addition, taxable income from non-REIT activities managed through the Company's TRS is subject to federal, state and local income taxes at normal corporate rates.

The Company recorded a provision for federal, state and foreign income tax expense of approximately $2 million and $14 million for the three months ended June 30, 2018 and 2017, respectively. The Company recorded a provision for federal, state and foreign income tax expense of approximately $1 million and $19 million for the six months ended June 30, 2018 and 2017, respectively. The provision for the three and six month periods ended June 30, 2018 and 2017 differs from the statutory federal tax rates of 21% and 35%, respectively, primarily due to the impact of state income taxes, the impact of certain costs relating to the separation of our franchise and management business from our owned real estate assets that are not deductible for income tax purposes, and the impact on the determination of the annualized effective tax rate as a result of the election of REIT status.

NOTE 11. EQUITY-BASED COMPENSATION

We recognize the cost of services received in an equity-based payment transaction with an employee as services are received and record either a corresponding increase in equity or a liability, depending on whether the instruments granted satisfy the equity or liability classification criteria.

The measurement objective for these equity awards is the estimated fair value at the grant date of the equity instruments that we are obligated to issue when employees have rendered the requisite service and satisfied any other conditions necessary to earn the right to benefit from the instruments. The compensation cost for an award classified as an equity instrument is recognized ratably over the requisite service period. The requisite service period is the period during which an employee is required to provide service for an award to vest. We recognize forfeitures as they occur.

In connection with the spin-off, the Company entered an agreement with LQH Parent to modify all outstanding awards granted to the employees of LQH Parent. Under the agreement, holders of LQH restricted stock awards and LQH restricted stock units received restricted shares and restricted stock units of CorePoint common stock.  Holders of LQH performance share units received CorePoint restricted stock awards.

Share-based compensation awards of employees remaining at La Quinta were adjusted in accordance with the anti-dilution provisions of the La Quinta Incentive Plan with the intent to preserve the intrinsic value of the original awards. The adjustments were determined by comparing the fair value of such awards immediately prior to the spin-offs to the fair value of such awards immediately after the spin-offs. Equity awards that were adjusted generally remain subject to the same vesting, expiration and other terms and conditions as applied to the awards immediately prior to the spin-offs.

Treatment of LQH Parent Outstanding Equity Awards

With respect to LQH Parent equity-based compensation awards that were outstanding under the LQH Incentive Plan on the distribution date, the Employee Matters Agreement entered into with LQH Parent, generally provides that, as of the separation, holders of such awards will be entitled to receive CorePoint equity-based compensation awards in amounts based on the distribution ratio. Generally, all such CorePoint equity-based compensation awards (except for the LQH PSUs, as described below) retain the same terms and vesting conditions as the original LQH Parent equity-based compensation awards to which such awards relate.

Treatment of LQH RSAs. At the spin-off, each holder of an LQH RSA received a number of restricted shares of CorePoint common stock (each, a “CPLG RSA”) calculated by multiplying (i) the number of LQH RSAs subject to each grant by (ii) the distribution ratio, rounded up to the nearest whole share. The CPLG RSAs are subject to the same terms and conditions from and following the spin-off as the terms and conditions applicable to the corresponding LQH RSAs immediately prior to the spin-off and will vest subject to continued employment with LQH or CorePoint, as applicable.

Treatment of LQH RSUs. At the spin-off, each holder of an LQH RSU received a number of restricted stock units of CorePoint common stock (each, a “CPLG RSU”) calculated by multiplying (i) the number of LQH RSUs subject to each grant by (ii) the distribution ratio, rounded up to the nearest whole share. The CPLG RSUs are subject to the same terms and conditions from and following the spin-off as the terms and conditions applicable to the corresponding LQH RSUs immediately prior to the spin-off and will vest subject to continued service with LQH or CorePoint, as applicable.

Treatment of LQH PSUs. Immediately prior to the spin-off, each ongoing Performance Period (as defined in the applicable LQH PSU grant notice) relating to each then-outstanding LQH PSU was terminated, and the LQH PSUs were bifurcated into (i) a number of

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LQH PSUs (expressed as a dollar value) calculated by multiplying (A) the target number of LQH PSUs (expressed as a dollar value) granted to the applicable holder by (B) a fraction, the numerator of which equaled the number of completed fiscal quarters between the commencement of the Performance Period applicable to such LQH PSU and the distribution date, and the denominator of which equaled the number of fiscal quarters in the Performance Period applicable to such LQH PSUs (the “Completed Period PSUs”), and (ii) a number of LQH PSUs (expressed as a dollar value) equal to the original target number of LQH PSUs awarded (expressed as a dollar value), less the number of corresponding Completed Period PSUs (expressed as a dollar value) (the “Remaining PSUs”).

Immediately prior to the spin-off, (i) a number of Completed Period PSUs (expressed as a dollar value) were deemed earned, based on the greater of (x) the level of achievement of applicable measures based on actual performance through the last completed fiscal quarter ending on or before the distribution date and (y) satisfaction of the applicable criteria at target levels, and (ii) a number of Remaining PSUs (expressed as a dollar value) were deemed earned based on satisfaction of the applicable criteria at target levels (in each case expressed as a dollar value and collectively, the “Banked PSUs”). Performance-based vesting with respect to the Banked PSUs was removed, and instead Banked PSUs will vest, subject to the holder’s continued employment with LQH or CorePoint, as applicable, through the last date of the original Performance Period to which such Banked PSUs relate. Any Completed Period PSU or Remaining PSU that was not earned as of the spin-off was forfeited without consideration as of such time.

Immediately prior to the spin-off, each Banked PSU were, by virtue of the spin-off, converted into a number of LQH RSAs equal to (i) the dollar value of such Banked PSU, divided by (ii) the Beginning Share Price (as such term is defined in the applicable LQH PSU grant notice) applicable to such Banked PSU, which LQH RSAs will be subject to the same vesting terms as the Banked PSU to which such LQH RSAs relate. Such converted LQH RSAs will be subject to the same treatment as set forth above with respect to LQH RSAs.

Continued Vesting. Following the spin-off, a grantee who has outstanding equity-based compensation awards under the LQH Incentive Plan and/or replacement equity-based compensation awards under our Omnibus Incentive Plan will be considered to have been employed by LQH or CorePoint, as applicable, prior to the spin-off, and to the extent such grantee continues to be employed by either LQH or CorePoint following the spin-off, after the spin-off, for purposes of (i) vesting and (ii) determining the date of termination of employment as it applies to any such award. Neither the transfer of employment to CorePoint nor the spin-off will constitute a “termination” under the LQH Incentive Plan.  The compensation expense related to the grants made under the LQH Incentive Plan and/or replacement equity-based compensation award for the employees of LQH post the spin-off date is incurred by LQH.  The compensation expense related to the grants made under the LQH Incentive Plan and/or replacement equity-based compensation award for the employees of CorePoint is incurred by CorePoint.  

For the three and six months ended June 30, 2018, we recognized $1 million and $2 million, respectively, of equity-based compensation expense in continuing operations. For the three and six months ended June 30, 2017, we recognized $2 million and $4 million, respectively, of equity-based compensation expense in continuing operations.

For the three and six months ended June 30, 2018, we recognized $1 million and $4 million, respectively, of equity-based compensation expense in discontinued operations. For the three and six months ended June 30, 2017, we recognized $2 million and $4 million, respectively, of equity-based compensation expense in discontinued operations.

The following table summarizes the activity of our RSAs during the six months ended June 30, 2018:

	Number of Shares			Weighted-Average Grant Date Fair Value
Unvested at January 1, 2018		512,117		$	25.90
Granted		633,241			27.89
Conversion of the performance units upon completion of the spin-off		423,510			27.92
Vested		(421,123	)		26.41
Forfeited		(5,737	)		27.45
Unvested at June 30, 2018		1,142,008		$	27.59

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NOTE 12. RELATED PARTY TRANSACTIONS

LQH Parent

As discussed in Note 3, CorePoint entered into the Separation and Distribution Agreement in January 2018 and entered into several other agreements with LQH Parent prior to consummation of the spin-off. These agreements set forth the principal transactions required to effect CorePoint Lodging’s separation from LQH and provide for the allocation between CorePoint and LQH Parent of various assets, liabilities, rights and obligations (including employee benefits, intellectual property, insurance and tax-related assets and liabilities) and govern the relationship between CorePoint Lodging and La Quinta after completion of the spin-off. These agreements also include arrangements with respect to transitional services to be provided by LQH Parent to CorePoint Lodging. In addition, prior to the spin-off, CorePoint Lodging entered into agreements, including long-term hotel management and franchise agreements for each of its hotels, with LQH that have either not existed historically, or that may be on different terms than the terms of the arrangement or agreements that existed prior to the spin-off.

In connection with the spin-off, CorePoint made the Cash Payment to LQH Parent of approximately $1.002 billion, immediately prior to and as a condition of the spin-off. The Cash Payment was to facilitate the repayment of part of LQH Parent’s existing debt. In addition, simultaneously with the closing of LQH Parent’s merger with a subsidiary of Wyndham Worldwide, Wyndham Worldwide repaid, or caused to be repaid, on behalf of LQH Parent, LQH Parent’s existing Term Facility.

Other Related Parties

Prior to April 14, 2014, LQH and predecessor entities were owned and controlled by Blackstone Real Estate Partners IV L.P. and affiliates (“BREP IV”) and Blackstone Real Estate Partners V L.P. and affiliates (“BREP V”). BREP IV and BREP V are affiliates of The Blackstone Group L.P. (collectivity, the “Funds” or “Blackstone”). As of June 30, 2018, Blackstone beneficially owned approximately 30.0% of our shares of common stock outstanding.  

As of June 30, 2018, approximately $518 million of the aggregate principal amount of our CMBS Facility was held by affiliates of Blackstone. As of December 31, 2017, approximately $82 million of the aggregate principal amount of LQH’s Term Facility was held by affiliates of Blackstone. In connection with the consummation of LQH Parent’s merger with a subsidiary of Wyndham Worldwide, on May 30, 2018, all outstanding amounts under LQH’s Term Facility were repaid in full.

We also purchase products and services from entities affiliated with or owned by Blackstone in the ordinary course of operating our business. The fees paid for these products and services were approximately $2 million during the three months ended June 30, 2017. The fees paid for these products and services were approximately $1 million and $2 million during the six months ended June 30, 2018 and 2017, respectively.

NOTE 13. SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

Supplemental cash flow information for the six months ended June 30, 2018 and 2017 is summarized below:

	For the Six Months Ended June 30,
	2018		2017
	(in millions)
Supplemental cash flow information:
Interest paid during the period	$	54	$	39
Income taxes paid during the period, net of refunds		1		4
Supplemental non-cash disclosure:
Capital expenditures included in accounts payable		5		19
Cash flow hedge adjustment, net of tax		1		2
Receivable for capital assets damaged by casualty disasters		3		4

NOTE 14. EARNINGS PER SHARE

Basic (loss) earnings per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of shares of common stock outstanding. Diluted earnings (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of shares of the Company’s common stock outstanding plus other

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potentially dilutive securities, except when the effect would be anti-dilutive. Dilutive securities include equity-based awards issued under long-term incentive plans, as discussed in Note 11.

The two-class method is an earnings allocation formula that determines EPS for each class of common stock and participating securities according to dividends or dividend equivalents and participation rights in undistributed earnings in periods when we have net income. The mandatorily redeemable preferred shares are considered participating securities and would be subject to the two-class method, as these shares have rights to earnings that otherwise would have been available to common shareholder.  The income from continuing operations would be impacted by the amount of dividends declared in the current period and the amount of any unpaid cumulative dividends.  As there was a loss for the three and six months ended June 30, 2018, the impact of the mandatorily redeemable preferred shares dividends would be anti-dilutive.

As described in Note 1, on May 30, 2018, LQH Parent stockholders of record as of 5:00 p.m. Eastern time, on May 18, 2018, received one share of CorePoint common stock for each share of LQH Parent common stock held after giving effect to the Reverse Stock Split. Basic and diluted net income (loss) per share for the three and six months ended June 30, 2018 is calculated using the weighted average number of basic, dilutive and anti-dilutive common shares outstanding during the periods, as adjusted for the one-to-two distribution ratio.

The following table sets forth the computation of basic and diluted earnings (loss) per share:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2018			2017			2018			2017
	(in millions, except per share data)
Numerator:
Income (loss) from Continuing Operations, net of tax	$	(28	)	$	19		$	(38	)	$	24
Loss on Discontinued Operations, net of tax		(20	)		(2	)		(25	)		(6	)
Net income (loss) attributable to CorePoint Lodging's      stockholders	$	(48	)	$	17		$	(63	)	$	18
Denominator:
Weighted average number of shares outstanding, basic		58.3			57.9			58.2			58.0
Weighted average number of shares outstanding, diluted		58.3			58.2			58.2			58.2
Basic and diluted earnings (loss) per share from continuing operations	$	(0.48	)	$	0.32		$	(0.65	)	$	0.41
Basic and diluted loss from discontinued operations		(0.34	)		(0.03	)		(0.43	)		(0.10	)
Basic and diluted (loss) earnings per share	$	(0.82	)	$	0.29		$	(1.08	)	$	0.31

For the three and six month periods ended June 30, 2018, approximately 0.7 million shares and 0.6 million shares, respectively, were excluded from the computation of diluted shares, as their impact would have been anti-dilutive.  For the three and six month periods ended June 30, 2017, approximately 0.4 million shares and 0.3 million shares, respectively, were excluded from the computation of diluted shares, as their impact would have been anti-dilutive.

NOTE 15. SUBSEQUENT EVENTS

On August 6, 2018, the Company announced that its Board of Directors declared a cash dividend of $0.067 per share of common stock with respect to the second quarter of 2018. This dividend is payable on September 14, 2018 to stockholders of record as of the close of business on August 30, 2018.

On August 2, 2018, we repaid the $25 million previously drawn on the Revolving Facility.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion contains management’s discussion and analysis of our financial condition and results of operations and should be read together with the unaudited condensed consolidated financial statements of CorePoint Lodging and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q. This discussion contains forward-looking statements that reflect our plans, estimates and beliefs and involve numerous risks and uncertainties, including but not limited to those described in the “Risk Factors” section of the Information Statement, as such risk factors may be updated from time to time in our periodic filings with the SEC. Actual results may differ materially from those contained in any forward-looking statements. You should carefully read “Special Note Regarding Forward-Looking Statements” in this Quarterly Report on Form 10-Q.

For purposes of the following discussion and unless otherwise indicated or the context otherwise requires, “we,” “our,” “us,” “CorePoint” and “CorePoint Lodging” refer to CorePoint Lodging Inc. and its consolidated subsidiaries in each case, after giving effect to the spin-off, including the internal reorganization and distribution; “LQH” refers to La Quinta Holdings Inc. and its consolidated subsidiaries; references to “LQH Parent” refer only to La Quinta Holdings Inc. exclusive of its subsidiaries, in each case before giving effect to the spin-off; “La Quinta” refers to La Quinta Holdings Inc. and its consolidated subsidiaries; and references to “La Quinta Parent” refer only to La Quinta Holdings Inc., exclusive of its subsidiaries, in each case after giving effect to the spin-off.   See “Overview—Basis of presentation” below.

Overview

Our business

CorePoint Lodging Inc. is a leading owner in the mid-scale and upper mid-scale select service hotel space, primarily under the La Quinta brand. Our portfolio, as of June 30, 2018, consisted of 316 hotels representing approximately 40,500 rooms across 41 states in attractive locations in or near employment centers, airports, and major travel thoroughfares. We primarily derive our revenues from owned hotel operations.

Strategic Priorities

CorePoint Lodging Inc. is positioned as the only publicly traded U.S. lodging REIT strategically focused on the ownership of mid-scale and upper mid-scale select-service hotels. Our strategic priorities include proactive asset management, value-enhancing investments, disciplined capital allocation, and maintaining a strong balance sheet.

Spin-off from LQH

On May 30, 2018, LQH Parent spun off of its real estate ownership business into an independent, publicly traded company as part of a plan approved by LQH Parent’s board of directors prior to the merger of LQH Parent with a wholly owned subsidiary of Wyndham Worldwide.

CorePoint Parent entered into a Separation and Distribution Agreement in January 2018 and several other agreements with La Quinta Parent prior to consummation of the spin-off. These agreements set forth the principal transactions required to effect CorePoint Lodging’s separation from La Quinta and provide for the allocation between CorePoint Parent and La Quinta Parent of various assets, liabilities, rights and obligations (including employee benefits, intellectual property, insurance and tax-related assets and liabilities) and govern the relationship between CorePoint Lodging and La Quinta after completion of the spin-off. These agreements also include arrangements with respect to transitional services to be provided by La Quinta to CorePoint Lodging.

In addition, prior to the spin-off, CorePoint Lodging entered into agreements, including long-term hotel management and franchise agreements for each of its hotels, with LQH that have either not existed historically, or that may be on different terms than the terms of the arrangement or agreements that existed prior to the spin-off. The unaudited condensed consolidated financial statements of CorePoint included herein do not reflect the effect of these new or revised agreements for the entirety of the periods presented and LQH’s historical expenses may not be reflective of CorePoint Lodging’s condensed consolidated results of operations, financial position and cash flows had it been a stand-alone company during the entirety of the periods discussed in the “Results of Operations” section below. Effective with the closing of the spin-off, the results of operations related to the hotel franchise and hotel management business are reported as discontinued operations

For U.S. federal income tax purposes, CorePoint Parent intends to make an election to be taxed as a REIT, effective May 31, 2018, with the filing of its U.S. federal income tax return for the year ending December 31, 2018. So long as CorePoint Parent qualifies as a REIT, it generally will not be subject to U.S. federal income tax on net taxable income that it distributes annually to its stockholders. To qualify as a REIT for U.S. federal income tax purposes, CorePoint Parent must continually satisfy tests concerning,

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among other things, the real estate qualification of sources of its income, the composition and values of its assets, the amounts it distributes to its stockholders and the ownership of its stock. In order to comply with REIT requirements, CorePoint Parent may need to forego otherwise attractive opportunities and limit its expansion opportunities and the manner in which it conducts its operations. See “Risk Factors—Risks Related to our REIT Status and Certain Other Tax Items” in the Information Statement.

Consistent with CorePoint Parent’s intent to elect to be treated as a REIT for U.S. federal income tax purposes beginning with the taxable year ending December 31, 2018 and thereafter, CorePoint Parent intends to make quarterly distributions to its stockholders in amounts that meet or exceed the requirements to qualify and maintain its qualification as a REIT and to avoid corporate level taxation. Prior to making any distributions for U.S. federal tax purposes or otherwise, CorePoint Parent must first satisfy its operating and debt service obligations. Although CorePoint Parent currently anticipates that its estimated cash available for distribution will exceed the annual distribution requirements applicable to REITs to avoid corporate level taxation, it is possible that it would be necessary to utilize cash reserves, liquidate assets at unfavorable prices or incur additional indebtedness in order to make required distributions.

Basis of presentation

Notwithstanding the legal form of the spin-off, for accounting and financial reporting purposes, the spin-off is presented as a reverse spin. This presentation is in accordance with generally accepted accounting principles in the United States (“GAAP”)  and is primarily a result of the relative significance of CorePoint Parent’s business to LQH’s business, as measured in terms of revenues, profits, and assets. Further, LQH has been determined to best represent the predecessor entity to CorePoint Parent. Therefore, our historical financial statements presented herein and in our future filings, with respect to periods prior to the spin-off, are represented by the historical financial statements of LQH, presenting La Quinta Parent as discontinued operations.

Hurricane Harvey and Hurricane Irma

During the third quarter of 2017, two major hurricanes made landfall impacting areas serviced by our hotels. In August 2017, Hurricane Harvey lingered over Texas and parts of Louisiana causing widespread flooding and associated damage. In September 2017, Hurricane Irma made its way up Florida’s west coast causing widespread wind damage, flooding and power outages. Many of our hotels in affected areas were impacted by the storms, including property damage, damage to infrastructure surrounding the hotels and business interruption. The storms impacted and will continue to impact in the near term, our revenues, expenses and gains and losses. Hurricanes Harvey and Irma had a meaningful impact on our business in the third and fourth quarters of 2017, as well as the first half of 2018.  

As of June 30, 2018, approximately three percent of our rooms remain out of service due to hurricane damage. We continue to work closely with our insurance adjusters, claims adjusters and construction staff to bring the affected rooms back online as quickly as possible. Property and business interruption insurance claims will be made as determined through the evaluation process; however, the timing and amount of insurance proceeds are uncertain and may not be sufficient to cover all losses. Capital expenditures will be made in order to restore these hotels to pre-hurricane condition and may be larger than normal due to the scope of the damage. Timing differences are likely to exist between the capital expenditures and insurance proceeds reflected in our financial statements.

Repositioning

In 2016, LQH Parent began a review of its owned hotel portfolio. This review of its owned hotel portfolio identified approximately 50 properties that, with the appropriate scope of capital investment and renovation, LQH Parent believed have the opportunity to re-position within a market, capturing occupancy and additional rate while being measured against new, higher quality competitive sets. LQH Parent began execution of a significant capital investment plan to invest more than $200 million in the hotels identified in the fourth quarter of 2016, with the start and completion dates for these projects being staggered through the end of 2018. The timing of the renovations has been sequenced with the goal of minimizing displacement, and maximizing readiness for peak demand seasons. As of June 30, 2018, the construction phase of the repositioning effort had been completed for 48 of these hotels.

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Segment

We have one reportable segment, our ownership segment, which included 316 properties totaling approximately 40,500 rooms within the United States (“U.S.”) as of June 30, 2018. Our reportable segment is a component of the business which is managed discretely and for which discrete financial information is reviewed regularly by our Chief Executive Officer, who is our chief operating decision maker, to assess performance and make decisions regarding the allocation of resources. Our reportable segment derives its earnings from the operation of owned hotel properties located in the United States.

As an owner of hotels, we can capture the full benefit of increases in operating profits during periods of increasing demand or ADR (as defined below). The cost structure of our typical hotel is more fixed than variable, so as demand and ADR increase over time, the pace of increase in operating profits typically is higher than the pace of increase of revenues. Hotel ownership is capital intensive, as we are responsible for the costs and capital expenditures for our hotels. The profits realized by us are generally significantly affected by economic downturns and declines in revenues. See also “—Key components and factors affecting our results of operations—Expenses” below and “Risk Factors—Risks Related to Our Business and Industry” in the Information Statement.

The following table sets forth the number of hotels in our portfolio as of June 30, 2018 and 2017.

	As of June 30,
	2018		2017
Number of Hotels
Owned Hotels (1)		315		318
Joint Venture		1		1
Total Hotels		316		319

⁽¹⁾ Owned Hotels includes 18 properties that are subject to ground leases; we include these 18 properties as hotels throughout this Management’s Discussion and Analysis of Financial Condition and Results of Operations. At June 30, 2018 and 2017, Owned Hotels include two and three hotels, respectively, which met the criteria to be classified as assets held for sale.

The following table summarizes our hotels as of June 30, 2018 and 2017:

	As of June 30,
	2018		2017
Number of Hotels(1)
La Quinta Inns & Suites (interior corridor)		181		178
La Quinta Inns & Suites (exterior corridor)		3		3
La Quinta Inns (interior corridor)		41		46
La Quinta Inns (exterior corridor)		90		92
Baymont Inns (exterior corridor)		1		-
Total Hotels		316		319

⁽¹⁾ Of the two hotels designated as assets held for sale as of June 30, 2018, one is a La Quinta Inns (interior corridor) and one is a La Quinta Inns (exterior corridor). Of the three hotels designated as assets held for sale as of June 30, 2017, one is a La Quinta Inns (interior corridor) and two are La Quinta Inns (exterior corridor).

Seasonality

The hotel industry is seasonal in nature. Generally, our revenues are greater in the second and third quarters than in the first and fourth quarters. The timing of holidays can also impact our quarterly results. The periods during which our properties experience higher revenues vary from property to property and depend principally upon location. This seasonality can be expected to cause quarterly fluctuations in revenue, profit margins and net earnings. Additionally, our quarterly results may be further affected by the timing of certain of our marketing production expenditures. Further, the timing of any hotel acquisitions or dispositions may cause a variation of revenue and earnings from quarter to quarter.

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Inflation

We do not believe that inflation had a material effect on our business during the three and six month periods ended June 30, 2018 and 2017. Although we believe that increases in the rate of inflation will generally result in comparable increases in hotel room rates, severe inflation could contribute to a slowing of the U.S. economy. Such a slowdown could result in a reduction in room rates and occupancy levels, negatively impacting our revenues and net income.

Key components and factors affecting our results of operations

Revenues

Room revenues are derived from room rentals at our hotels. We recognize room revenue on a daily basis based on an agreed-upon daily rate after the guest has stayed at one of our hotels. Customer incentive discounts, cash rebates, and refunds are recognized as a reduction of room revenues. Occupancy, hotel, and sales taxes collected from customers and remitted to the taxing authorities are excluded from revenues in the accompanying condensed consolidated statements of operations.  

Principal Components of Revenues

Rooms. These revenues represent the sale of room rentals at our hotels and account for a substantial majority of our total revenue

Other revenue.  These revenues represent revenue generated by the incidental support of operations at our hotels, including charges to guests for vending commissions, meeting and banquet room revenue, and other rental income from operating leases associated with leasing space for restaurants, billboards and cell towers.

Factors Affecting our Revenues

Consumer demand. Consumer demand for our products and services is closely linked to the performance of the general economy and is sensitive to business and personal discretionary spending levels. Leading indicators of demand include gross domestic product, non-residential fixed investment and the consumer price index. Declines in consumer demand due to adverse general economic conditions, reductions in travel patterns, lower consumer confidence and adverse political conditions can lower the revenues and profitability of our hotels. Further, competition for guests and the supply of services at our hotels affect our ability to sustain or increase rates charged to customers at our hotels. As a result, changes in consumer demand and general business cycles have historically subjected, and could in the future subject, our revenues to significant volatility. In addition, leisure travelers make up the majority of our transient demand. Therefore, we will be significantly more affected by trends in leisure travel than trends in business travel.

Supply. New room supply is an important factor that can affect the lodging industry’s performance. Room rates and occupancy, and thus RevPAR, tend to increase when demand growth exceeds supply growth. The addition of new competitive hotels affects the ability of existing hotels to sustain or grow RevPAR, and thus profits.

Expenses

Principal Components of Expenses

Rooms. These expenses include hotel expenses of housekeeping, reservation systems, room and breakfast supplies and front desk costs.

Other departmental and support. These expenses include labor and other expenses that constitute non-room operating expenses, including parking, telecommunications, on-site administrative departments, sales and marketing, recurring repairs and maintenance and utility expenses.

Property tax, insurance and other. These expenses consist primarily of real and personal property taxes, other local taxes, ground rent, equipment rent and insurance.

Management and royalty fees. Management fees represent fees paid to third parties and are computed as a percentage of gross revenue.  Royalty fees are generally computed as a percentage of rooms revenues. In connection with the spin-off, we entered into new management and franchise agreements, refer to Note 9, “Commitments and Contingencies” included in the notes to the unaudited condensed consolidated financial statements elsewhere in this Quarterly Report on Form 10-Q for additional information.

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Corporate general and administrative. These expenses include off-site general and administrative expenses, consisting primarily of compensation, contract labor expense for our corporate staff, professional fees, travel expenses, and office administrative and related expenses.  

Other, net. These expenses include losses incurred resulting from property damage or destruction caused by any sudden, unexpected or unusual event such as a hurricane. Impairment losses are non-cash expenses that are recognized when circumstances indicate that the carrying value of a long-lived asset is not recoverable. An impairment loss is recognized for the excess of the carrying value over the fair value of the asset.

Factors Affecting our Costs and Expenses

Variable expenses. Expenses associated with our room expenses are mainly affected by occupancy and correlate closely with their respective revenues. These expenses can increase based on increases in salaries and wages, as well as on the level of service and amenities that are provided.

Fixed expenses. Many of the other expenses associated with our hotels are relatively fixed. These expenses include portions of rent expense, property taxes, insurance and utilities. Since we generally are unable to decrease these costs significantly or rapidly when demand for our hotels decreases, any resulting decline in our revenues can have a greater adverse effect on our net cash flow, margins and profits. This effect can be especially pronounced during periods of economic contraction or slow economic growth. The effectiveness of any cost-cutting efforts is limited by the amount of fixed costs inherent in our business. As a result, we may not be able to successfully offset revenue reductions through cost cutting. In addition, any efforts to reduce costs, or to defer or cancel capital improvements, could adversely affect the economic value of our hotels. We have taken steps to reduce our fixed costs to levels we believe are appropriate to maximize profitability and respond to market conditions without jeopardizing the overall customer experience or the value of our hotels.

Changes in depreciation and amortization expense. Changes in depreciation expense are due to renovations of existing hotels, acquisition or development of new hotels, the disposition of existing hotels through sale or closure or changes in estimates of the useful lives of our assets. As we place new assets into service, we will be required to recognize additional depreciation expense on those assets.

Key indicators of financial condition and operating performance

We use a variety of financial and other information in monitoring the financial condition and operating performance of our business. Some of this information is financial information that is prepared in accordance with GAAP, while other information may be financial in nature and may not be prepared in accordance with GAAP. Our management also uses other information that may not be financial in nature, including statistical information and comparative data that are commonly used within the lodging industry to evaluate hotel financial and operating performance. Our management uses this information to measure the performance of hotel properties and/or our business as a whole. Historical information is periodically compared to budgets, as well as against industry-wide information. We use this information for planning and monitoring our business, as well as in determining management and employee compensation.

Average daily rate (“ADR”) represents hotel room revenues divided by total number of rooms sold in a given period. ADR measures the average room price attained by a hotel or group of hotels, and ADR trends provide useful information concerning pricing policies and the nature of the guest base of a hotel or group of hotels. Changes in room rates have an impact on overall revenues and profitability.

Occupancy represents the total number of rooms sold in a given period divided by the total number of rooms available at a hotel or group of hotels. Occupancy measures the utilization of our hotels’ available capacity. Management uses occupancy to gauge demand at a specific hotel or group of hotels in a given period. Occupancy levels also help us determine achievable ADR levels as demand for hotel rooms increases or decreases.

Revenue per available room (“RevPAR”) is defined as the product of the ADR charged and the average daily occupancy achieved. RevPAR does not include other ancillary, non-room revenues, such as food and beverage revenues or parking, telephone or other guest service revenues generated by a hotel, which are not significant for CorePoint.

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RevPAR changes that are driven predominately by occupancy have different implications for overall revenue levels and incremental hotel operating profit than changes driven predominately by ADR. For example, increases in occupancy at a hotel would lead to increases in room revenues, as well as incremental operating costs (including, but not limited to, housekeeping services, utilities and room amenity costs). RevPAR increases due to higher ADR, however, would generally not result in additional operating costs, with the exception of those charged or incurred as a percentage of revenue, such as credit card fees and commissions. As a result, changes in RevPAR driven by increases or decreases in ADR generally have a greater effect on operating profitability at our hotels than changes in RevPAR driven by occupancy levels. Due to seasonality in our business, we review RevPAR by comparing current periods to budget and period-over-period.

Comparable hotels are defined as hotels that were active and operating in our system for at least one full calendar year as of the end of the applicable reporting period and were active and operating as of January 1st of the previous year; except for: (i) hotels that sustained substantial property damage or other business interruption; (ii) hotels that become subject to a purchase and sale agreement; or (iii) hotels in which comparable results are otherwise not available. Management uses comparable hotels as the basis upon which to evaluate ADR, occupancy, and RevPAR. We report variances in ADR, occupancy, and RevPAR between periods for the set of comparable hotels existing at the reporting date versus the results of the same set of hotels in the prior period.  Of the 316 hotels in our system as of June 30, 2018, 306 have been classified as comparable hotels.

Non GAAP Financial Measures

We also evaluate the performance of our business through certain other financial measures that are not recognized under GAAP. Each of these non-GAAP financial measures should be considered by investors as supplemental measures to GAAP performance measures such as total revenues, operating profit and net income.

EBITDA, EBITDAre and Adjusted EBITDAre

EBITDA

“EBITDA.” Earnings before interest, taxes, depreciation and amortization (“EBITDA”) is a commonly used measure in many industries.  The Company believes EBITDA is useful in evaluating our operating performance because it provides an indication of our ability to incur and service debt, to satisfy general operating expenses, and to make capital expenditures.  EBITDA is a commonly used measure in many industries.

EBITDAre and Adjusted EBITDAre

“EBITDAre.” The Company presents EBITDAre in accordance with guidelines established by the National Association of Real Estate Investment Trusts (“NAREIT”).  NAREIT defines EBITDAre as net income or loss, excluding interest expense, income tax expense, depreciation and amortization, gains or losses on the disposition of property, impairments, and adjustments to reflect the entity’s share of EBITDAre of unconsolidated affiliates.  The Company believes EBITDAre is a useful performance measure to help investors evaluate and compare the results of the Company’s operations from period to period.  EBITDAre is intended to be a supplemental non-GAAP financial measure that is independent of a company’s capital structure.

“Adjusted EBITDAre.”  The Company adjusts EBITDAre when evaluating its performance because the Company believes that the adjustment for certain items, such as reorganization and separation transaction expenses, acquisition and disposition transaction expenses, stock-based compensation expense, discontinued operations, and other items not indicative of ongoing operating performance, provides useful supplemental information to management and investors regarding its ongoing operating performance. The Company believes that EBITDAre and Adjusted EBITDAre provide useful information to investors about it and its financial condition and results of operations for the following reasons: (i) EBITDAre and Adjusted EBITDAre are among the measures used by the Company’s management team to evaluate its operating performance and make day-to-day operating decisions; and (ii) EBITDAre and Adjusted EBITDAre are frequently used by securities analysts, investors, lenders and other interested parties as a common performance measure to compare results or estimate valuations across companies in the Company’s industry.

EBITDAre and Adjusted EBITDAre are not recognized terms under GAAP, have limitations as analytical tools and should not be considered either in isolation or as a substitute for net (loss) income, cash flow or other methods of analyzing the Company’s results as reported under GAAP. Some of these limitations are:

• EBITDAre and Adjusted EBITDAre do not reflect changes in, or cash requirements for, the Company’s working capital needs;

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• EBITDAre and Adjusted EBITDAre do not reflect the Company’s interest expense, or the cash requirements necessary to service interest or principal payments, on its indebtedness;

• EBITDAre and Adjusted EBITDAre do not reflect the Company’s tax expense or the cash requirements to pay its taxes;

• EBITDAre and Adjusted EBITDAre do not reflect historical cash expenditures or future requirements for capital expenditures or contractual commitments;

• EBITDAre and Adjusted EBITDAre do not reflect the impact on earnings or changes resulting from matters that the Company considers not to be indicative of its future operations;

• although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDAre and Adjusted EBITDAre do not reflect any cash requirements for such replacements; and

• other companies in the Company’s industry may calculate EBITDAre and Adjusted EBITDAre differently, limiting their usefulness as comparative measures.

Because of these limitations, EBITDAre and Adjusted EBITDAre should not be considered as discretionary cash available to the Company to reinvest in the growth of its business or as measures of cash that will be available to the Company to meet its obligations.

The following is a reconciliation of our GAAP net income (loss) to EBITDA, EBITDAre and Adjusted EBITDAre for the three and six months ended June 30, 2018 and 2017 (in millions):

	Three Months Ended June 30, 2018			Three Months Ended June 30, 2017			Six Months Ended June 30, 2018			Six Months Ended June 30, 2017
Net Income (loss) attributable to CorePoint Lodging     Stockholders	$	(48	)	$	17		$	(63	)	$	18
Interest expense		18			12			31			24
Income tax expense		2			14			1			19
Depreciation and amortization		39			34			76			68
Loss from discontinued operations		20			2			25			6
EBITDA		31			79			70			135
Impairment loss and casualty (gain) loss		3			(1	)		2			(3	)
EBITDAre		34			78			72			132
Stock-based compensation		1			2			2			4
Reorganization costs		26			5			38			9
Loss on extinguishment of debt		10			—			10			—
Other, net		(1	)		—			—			2
Adjusted EBITDAre	$	70		$	85		$	122		$	147

NAREIT FFO attributable to stockholders and Adjusted FFO attributable to stockholders

We present NAREIT FFO attributable to stockholders and NAREIT FFO per diluted share (defined as set forth below) as non-GAAP measures of our performance. We calculate funds from operations (“FFO”) attributable to stockholders for a given operating period in accordance with standards established by NAREIT, as net income or loss attributable to stockholders (calculated in accordance with GAAP), excluding depreciation and amortization, gains or losses on sales of assets, impairment, and the cumulative effect of changes in accounting principles, plus adjustments for unconsolidated joint ventures. Adjustments for unconsolidated joint ventures are calculated to reflect our pro rata share of the FFO of those entities on the same basis. As noted by NAREIT in its April 2002 “White Paper on Funds From Operations,” since real estate values historically have risen or fallen with market conditions, many industry investors have considered presentation of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. For these reasons, NAREIT adopted the FFO metric in order to promote an industry-wide measure of REIT operating performance. We believe NAREIT FFO provides useful information to investors regarding our operating performance

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and can facilitate comparisons of operating performance between periods and between REITs. Our presentation may not be comparable to FFO reported by other REITs that do not define the terms in accordance with the current NAREIT definition, or that interpret the current NAREIT definition differently than we do. We calculate NAREIT FFO per diluted share as our NAREIT FFO divided by the number of fully diluted shares outstanding during a given operating period.

We also present Adjusted FFO attributable to stockholders and Adjusted FFO per diluted share when evaluating our performance because we believe that the exclusion of certain additional items described below provides useful supplemental information to investors regarding our ongoing operating performance. Management historically has made the adjustments detailed below in evaluating our performance and in our annual budget process. We believe that the presentation of Adjusted FFO provides useful supplemental information that is beneficial to an investor’s complete understanding of our operating performance. We adjust NAREIT FFO attributable to stockholders for the following items, which may occur in any period, and refer to this measure as Adjusted FFO attributable to stockholders: transaction expense associated with the potential disposition of hotels or acquisition of a business, severance expense, share-based compensation expense, litigation gains and losses outside the ordinary course of business, amortization of deferred financing costs, reorganization costs and separation transaction expenses, loss on early extinguishment of debt, straight-line ground lease, casualty losses, and other items that we believe are not representative of our current or future operating performance

NAREIT FFO attributable to stockholders and Adjusted FFO attributable to stockholders are not recognized terms under GAAP, have limitations as analytical tools and should not be considered either in isolation or as a substitute for net income (loss), cash flow or other methods of analyzing our results as reported under GAAP.

The following table provides a reconciliation of net income (loss) attributable to stockholders to NAREIT FFO attributable to stockholders and Adjusted FFO attributable to stockholders (in millions):

	Three Months Ended June 30, 2018			Three Months Ended June 30, 2017			Six Months Ended June 30, 2018			Six Months Ended June 30, 2017
Net Income (loss) attributable to CorePoint Lodging     Stockholders	$	(48	)	$	17		$	(63	)	$	18
Depreciation and amortization		39			34			76			68
Loss from discontinued operations		20			2			25			6
Impairment loss and casualty (gain) loss		3			(1	)		2			(3	)
NAREIT FFO attributable to stockholders		14			52			40			89
Stock-based compensation		1			2			2			4
Amortization of deferred financing costs		3			2			4			3
Reorganization costs		26			5			38			9
Loss on extinguishment of debt		10			—			10			—
Other, net		(1	)		—			—			2
Adjusted FFO attributable to stockholders	$	53		$	61		$	94		$	107

Results of operations

The following table presents hotel operating statistics for our comparable hotels for the applicable periods ⁽¹⁾:

	Three Months Ended June 30, 2018			Variance Three Months 2018 vs. Three Months 2017			Six Months Ended June 30, 2018			Variance Six Months 2018 vs. Six Months 2017
Occupancy		69.8	%	60		bps		65.2	%		-90	bps
ADR	$	90.74			4.7	%	$	90.04			4.5	%
RevPAR	$	63.29			5.6	%	$	58.66			3.1	%

⁽¹⁾ See definition of comparable hotels in “—Key indicators of financial condition and operating performance—Comparable hotels.”

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Beginning in the second half of 2016, we began enacting several key initiatives designed to further improve our RevPAR performance, including taking steps to enhance consistency of product and guest experience and investing in points of differentiation to encourage engagement with the brand. These initiatives caused incremental expenditures in 2017 and continued into 2018. We expect to incur additional incremental expenditures in the future as these initiatives are implemented.

From June 30, 2017 to June 30, 2018, our total number of hotels has decreased from 319 hotels to 316 hotels with rooms decreasing from approximately 40,900 rooms to approximately 40,500 rooms

Three months ended June 30, 2018 compared with three months ended June 30, 2017

The following table presents our overall operating performance for the three months ended June 30, 2018 and 2017, including the amount and percentage change in these results between the periods:

	For the Three Months Ended June 30,						Increase/(Decrease)
(in millions)	2018			2017			$ change			% change
REVENUES:
Rooms	$	228		$	221		$	7			3.2
Other		5			4			1			25.0
Total Revenues		233			225			8			3.6
OPERATING EXPENSES:
Rooms		98			89			9			10.1
Other departmental and support		30			29			1			3.4
Property tax, insurance and other		17			10			7			70.0
Management and royalty fees		9			—			9		NM			(1)
Corporate general and administrative		39			19			20		NM			(1)
Depreciation and amortization		39			34			5			14.7
Other, net		3			(1	)		4		NM			(1)
Total Operating Expenses		235			180			55			30.6
Operating Income (Loss)		(2	)		45			(47	)	NM			(1)
OTHER INCOME (EXPENSES):
Interest expense		(18	)		(12	)		(6	)		50.0
Other income, net		4			—			4		NM			(1)
Loss on extinguishment of debt		(10	)		—			(10	)	NM			(1)
Total Other Expenses, net		(24	)		(12	)		(12	)		100.0
Income (Loss) from Continuing Operations Before Income Taxes		(26	)		33			(59	)	NM			(1)
Income tax expense		(2	)		(14	)		12			(85.7	)
Income (Loss) from Continuing Operations, net of tax		(28	)		19			(47	)	NM			(1)
Loss from Discontinued Operations, net of tax		(20	)		(2	)		(18	)	NM			(1)
Net Income (loss) attributable to CorePoint Lodging stockholders	$	(48	)	$	17		$	(65	)	NM			(1)

⁽¹⁾ Fluctuation in terms of percentage change is not meaningful.

Revenues

Room revenues at our hotels for the three months ended June 30, 2018 and 2017 totaled $228 million and $221 million, respectively. The increase of $7 million or 3.2 percent, was primarily driven by an increase in RevPAR at our comparable hotels of 5.6 percent, which was due to increases in ADR and occupancy of 4.7 percent and 60 basis points, respectively. This increase was partially offset by the sale of three hotels between the periods and a decrease in the number of available rooms due to damage caused by hurricanes in the third quarter of 2017.  Excluding the impact of the hotels impacted by the hurricanes, comparable RevPAR increased 6.4 percent for the three months ended June 30, 2018 over the comparable prior period.

Other revenues at our hotels for each of the three month periods ended June 30, 2018 and 2017 totaled $5 million and $4 million, respectively. These revenues represent revenue generated by the incidental support of operations at our hotels, including

37

charges to guests for vending commissions, meeting and banquet room revenue, and other rental income from operating leases associated with leasing space for restaurants or other retail sites, billboards and cell towers.

Operating expenses

	Three Months Ended June 30,				Percent change
(in millions)	2018		2017		2018 vs. 2017
Rooms	$	98	$	89		10.1

Rooms expense for our hotels totaled $98 million and $89 million for the three months ended June 30, 2018 and 2017, respectively, resulting in an increase of $9 million. The variance in rooms expenses was primarily caused by increases in payroll (including salaries and hourly wages) and benefits, sales manager expenses due to additional labor investments across the portfolio, contract labor due to difficulty in hiring, travel agency commission costs due to increased volume driven through third party online travel agencies and hotel supply expense. These increases were partially offset by decreases in expense caused by three fewer hotels in the hotel portfolio at June 30, 2018 in comparison to the hotels owned at June 30, 2017.

	Three Months Ended June 30,				Percent change
(in millions)	2018		2017		2018 vs. 2017
Other departmental and support	$	30	$	29		3.4

Other departmental and support expense for our hotels totaled $30 million and $29 million, for the three months ended June 30, 2018 and 2017, respectively, resulting in an increase of $1 million. The variance was a result of increased ancillary hotel expenses, repairs and maintenance expenses, and uninsured losses. These increases were partially offset by decreases in utilities costs and purchased services, which were primarily caused by three fewer hotels in the hotel portfolio at June 30, 2018 in comparison to the hotels owned at June 30, 2017.

	Three Months Ended June 30,				Percent change
(in millions)	2018		2017		2018 vs. 2017
Property tax, insurance and other	$	17	$	10		70.0

Property tax, insurance and other expense for our hotels totaled $17 million and $10 million, for the three months ended June 30, 2018 and 2017, respectively, resulting in an increase of $7 million. The increase in other property-level expense was primarily due to lower insurance expense recorded in 2017 resulting from prior years estimated insurance loss reserve adjustment. Additionally, property taxes increased period over period due to higher property tax valuations.

	Three Months Ended June 30,				Percent change
(in millions)	2018		2017		2018 vs. 2017
Management and royalty fees	$	9	$	—	NM	(1)

(1) Fluctuation in terms of percentage change is not meaningful

Management and royalty fees totaled $9 million for the three months ended June 30, 2018.  On May 30, 2018, in connection with the spin-off, we entered into management and franchise agreements for our hotels with La Quinta Management L.L.C. (“LQM”) and La Quinta Franchising LLC (“LQ Franchising”), respectively.  Management fees are computed as five percent of total gross revenue and royalty fees are computed as five percent of total rooms revenues.

	Three Months Ended June 30,				Percent change
(in millions)	2018		2017		2018 vs. 2017
Corporate general and administrative	$	39	$	19	NM	(1)

(1) Fluctuation in terms of percentage change is not meaningful

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Corporate general and administrative expenses for our hotels totaled $39 million and $19 million, for the three months ended June 30, 2018 and 2017, respectively, resulting in an increase of $20 million. The increase in corporate general and administrative expenses was primarily the result of increased transition costs and non-recurring transaction costs associated with establishing CorePoint Lodging as an independent, publicly traded company.

	Three Months Ended June 30,				Percent change
(in millions)	2018		2017		2018 vs. 2017
Depreciation and amortization	$	39	$	34		14.7

Depreciation and amortization expense for our hotels totaled $39 million and $34 million, for the three months ended June 30, 2018 and 2017, respectively.  The increase of $5 million was primarily the result of additional depreciation on certain assets in 2018 driven by increases in capital expenditures between June 30, 2017 and June 30, 2018.

	Three Months Ended June 30,					Percent change
(in millions)	2018		2017			2018 vs. 2017
Other, net	$	3	$	(1	)	NM	(1)

(1) Fluctuation in terms of percentage change is not meaningful

Other expenses for our hotels totaled $3 million and ($1) million, respectively for the three months ended June 30, 2018 and 2017 resulting in an increase of $4 million. The increase in other expenses was the result of increased loss due to natural disasters in the three months ended June 30, 2018 as compared to gains from insurance recoveries related to natural disasters in the three months ended June 30, 2017.

Non-operating Income (Expenses)

	Three Months Ended June 30,						Percent change
(in millions)	2018			2017			2018 vs. 2017
Interest expense	$	(18	)	$	(12	)		50.0
Other income, net	$	4		$	—		NM			(1)
Loss on extinguishment of debt	$	(10	)	$	—		NM			(1)
Income tax expense	$	(2	)	$	(14	)		(85.7	)

(1) Fluctuation in terms of percentage change is not meaningful

On May 30, 2018, in connection with the spin-off, we borrowed an aggregate principal amount of $1.035 billion under the CMBS Facility (as defined below).  The proceeds from the CMBS Facility were used to facilitate the repayment of part of LQH Parent’s Term Facility. In addition, simultaneously with the closing of LQH Parent’s merger with a subsidiary of Wyndham Worldwide, Wyndham Worldwide repaid, or caused to be repaid, on behalf of LQH Parent, LQH Parent’s Term Facility. The interest rate on the CMBS Facility is one-month LIBOR plus 2.75% per annum through the initial period.  Additionally, on May 30, 2018, we borrowed $25.0 million under our Revolving Facility (as defined below) at a rate of one-month LIBOR plus 4.50% per annum.  The deferred financing costs related to the CMBS Facility are being amortized over the initial term of the CMBS Facility.  The increase in interest expense was primarily due to these changes in the structure of the debt facilities.  

Other income, net totaled $4 million for the three months ended June 30, 2018. The increase of $4 million was primarily due to recognition of the gain from the settlement of the interest rate swap.

Loss on extinguishment of debt totaled $10 million for the three months ended June 30, 2018 and was attributable to the early repayment of LQH’s Term Facility.

We compute our income tax expense on a quarterly basis by applying the estimated annual effective tax rate to results from continuing operations and taxable income. The provision for the three month periods ended June 30, 2018 and 2017 differs from the statutory federal tax rates of 21% and 35%, respectively, primarily due to the impact of state income taxes, costs relating to the spin-

39

off of our franchise and management business from our owned real estate assets that are not deductible for tax purposes and the impact on the determination of the annualized effective tax rate as a result of the election of REIT status.  See “—Critical accounting policies and estimates—Income taxes” previously disclosed in the Information Statement.

Six months ended June 30, 2018 compared with six months ended June 30, 2017

The following table presents our overall operating performance for the six months ended June 30, 2018 and 2017, including the amount and percentage change in these results between the periods:

	Six Months Ended June 30,						Increase/(Decrease)
(in millions)	2018			2017			$ change			% change
REVENUES:
Rooms	$	420		$	421		$	(1	)		(0.2	)
Other		9			8			1			12.5
Total Revenues		429			429			—			—
OPERATING EXPENSES:
Rooms		185			174			11			6.3
Other departmental and support		59			58			1			1.7
Property tax, insurance and other		35			27			8			29.6
Management and royalty fees		9			—			9		NM			(1)
Corporate general and administrative		63			38			25			65.8
Depreciation and amortization		76			68			8			11.8
Other, net		2			(3	)		5		NM			(1)
Total Operating Expenses		429			362			67			18.5
Operating Income (Loss)		—			67			(67	)		(100.0	)
OTHER INCOME (EXPENSES):
Interest expense		(31	)		(24	)		(7	)		29.2
Other income, net		4			—			4		NM			(1)
Loss on extinguishment of debt		(10	)		—			(10	)	NM			(1)
Total Other Expenses, net		(37	)		(24	)		(13	)		54.2
Income (loss) from Continuing Operations Before Income Taxes		(37	)		43			(80	)	NM			(1)
Income tax expense		(1	)		(19	)		18			(94.7	)
Income (loss) from Continuing Operations, net of tax		(38	)		24			(62	)	NM			(1)
Loss from Discontinued Operations, net of tax		(25	)		(6	)		(19	)	NM			(1)
Net Income (loss) attributable to CorePoint Lodging stockholders	$	(63	)	$	18		$	(81	)	NM			(1)

⁽¹⁾ Fluctuation in terms of percentage change is not meaningful

Revenues

Room revenues at our hotels for the six months ended June 30, 2018 and 2017 totaled $420 million and $421 million, respectively. The decrease of $1 million, or 0.2 percent, was primarily due to a decrease in the number of available rooms due to damage caused by hurricanes in the third quarter of 2017 and also driven by the sale of three hotels between the periods.  RevPAR at our comparable hotels increased 3.1 percent for the six months ended June 30, 2018 over the prior year period. The increase in RevPAR was driven by an increase in ADR of 4.5 percent, offset slightly by a decrease in occupancy of 90 basis points. Excluding the impact of the hotels impacted by the hurricanes, comparable RevPAR increased 5.3 percent for the six months ended June 30, 2018.

Other hotel revenues for the six months ended June 30, 2018 and 2017 totaled $9 million and $8 million, respectively. These revenues represent revenue generated by the incidental support of operations at our hotels, including charges to guests for vending commissions, meeting and banquet room revenue, and other rental income from operating leases associated with leasing space for restaurants or other retail sites, billboards and cell towers.

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Operating expenses

	Six Months Ended June 30,				Percent change
(in millions)	2018		2017		2018 vs. 2017
Rooms	$	185	$	174		6.3

Rooms expense for our hotels totaled $185 million and $174 million for the six months ended June 30, 2018 and 2017, respectively, resulting in an increase of $11 million. The variance in rooms expenses was primarily caused by increases in payroll (including salaries and hourly wages) and benefits, sales manager expenses due to additional labor investments across the portfolio, contract labor due to difficulty in hiring, travel agency commission costs due to increased volume driven through third party online travel agencies and hotel supply expense. These increases were partially offset by decreases in expense caused by three fewer hotels in the hotel portfolio at June 30, 2018 in comparison to the hotels owned at June 30, 2017.

	Six Months Ended June 30,				Percent change
(in millions)	2018		2017		2018 vs. 2017
Other departmental and support	$	59	$	58		1.7

Other departmental and support expense for our hotels totaled $59 million and $58 million, for the six months ended June 30, 2018 and 2017, respectively, resulting in an increase of $1 million. The variance was a result of increased ancillary hotel expenses, repairs and maintenance expenses, and uninsured losses. These increases were partially offset by decreases in utilities costs, which were primarily caused by three fewer hotels in the hotel portfolio at June 30, 2018 in comparison to the hotels owned at June 30, 2017.

	Three Months Ended June 30,				Percent change
(in millions)	2018		2017		2018 vs. 2017
Property tax, insurance and other	$	35	$	27		29.6

Property tax, insurance and other expense for our hotels totaled $35 million and $27 million, for the six months ended June 30, 2018 and 2017, respectively, resulting in an increase of $8 million. The increase in other property-level expense was primarily due to lower insurance expense recorded in 2017 resulting from prior years estimated insurance loss reserve adjustment. Additionally, property taxes increased period over period due to higher property tax valuations.

	Six Months Ended June 30,				Percent change
(in millions)	2018		2017		2018 vs. 2017
Management and royalty fees	$	9	$	—	NM	(1)

(1) Fluctuation in terms of percentage change is not meaningful

Management and royalty fees for our hotels totaled $9 million the six months ended June 30, 2018. On May 30, 2018, in connection with the spin-off, we entered into management and franchise agreements for our hotels with LQM and LQ Franchising, respectively.  Management fees are computed as five percent of gross revenue and royalty fees are computed as five percent of rooms revenues.

	Six Months Ended June 30,				Percent change
(in millions)	2018		2017		2018 vs. 2017
Corporate general and administrative	$	63	$	38		65.8

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Corporate general and administrative expenses for our hotels totaled $63 million and $38 million, for the six months ended June 30, 2018 and 2017, respectively, resulting in an increase of $25 million. The increase in corporate general and administrative expenses were primarily the result of increased transition costs and other non-recurring costs associated with establishing CorePoint Lodging as an independent, publicly traded company.

	Six Months Ended June 30,				Percent change
(in millions)	2018		2017		2018 vs. 2017
Depreciation and amortization	$	76	$	68		11.8

Depreciation and amortization expense for our hotels totaled $76 million and $68 million, for the six months ended June 30, 2018 and 2017, respectively. The increase of $8 million, was primarily the result of additional depreciation on certain assets in the first six months of 2018 driven by an increase in capital expenditures between June 30, 2017 and June 30, 2018.

	Six Months Ended June 30,					Percent change
(in millions)	2018		2017			2018 vs. 2017
Other, net	$	2	$	(3	)	NM	(1)

(1) Fluctuation in terms of percentage change is not meaningful

Other expenses for our hotels totaled $2 million and ($3) million, for the six months ended June 30, 2018 and 2017, respectively, resulting in an increase of $5 million. The increase in other was the result of increased loss due to natural disasters as compared to gains from insurance recoveries related to natural disasters in the six months ended June 30, 2017.

Non-operating Income (Expenses)

	Six Months Ended June 30,						Percent change
(in millions)	2018			2017			2018 vs. 2017
Interest expense	$	(31	)	$	(24	)		29.2
Other income, net	$	4		$	-		NM			(1)
Loss on extinguishment of debt	$	(10	)	$	-		NM			(1)
Income tax expense	$	(1	)	$	(19	)		(94.7	)

(1) Fluctuation in terms of percentage change is not meaningful

On May 30, 2018, in connection with the spin-off, we borrowed an aggregate principal amount of $1.035 billion under the CMBS Facility.  The proceeds from the CMBS Facility were used to facilitate the repayment of part of LQH Parent’s Term Facility. In addition, simultaneously with the closing of the merger, Wyndham Worldwide repaid, or caused to be repaid, on behalf of LQH Parent, LQH Parent’s existing Term Facility. The interest rate on the CMBS Facility is one-month LIBOR plus 2.75% per annum through the initial period.  Additionally, on May 30, 2018, we borrowed $25 million under our Revolving Facility at a rate of one-month LIBOR plus 4.50% per annum.  The deferred financing costs related to the CMBS Facility are being amortized over the initial term of the CMBS Facility.  The increase in interest expense was primarily due to these changes in the structure of the debt facilities.

Other income, net, totaled $4 million for the six months ended June 30, 2018. The increase of $4 million was primarily due to recognition of the gain from the settlement of our interest rate swap.

Loss on extinguishment of debt totaled $10 million for the six months ended June 30, 2018 and was attributable to the early repayment of LQH’s Term Facility.

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We compute our income tax expense on a quarterly basis by applying the estimated annual effective tax rate to results from continuing operations and taxable income. The provision for the six month periods ended June 30, 2018 and 2017 differs from the statutory federal tax rates of 21% and 35%, respectively, primarily due to the impact of state income taxes, costs relating to the spin-off of our franchise and management business from our owned real estate assets that are not deductible for tax purposes and the impact on the determination of the annualized effective tax rate as a result of the election of REIT status.  See “—Critical accounting policies and estimates—Income taxes” previously disclosed in the Information Statement.

Liquidity and Capital Resources

Overview

As of June 30, 2018, we had total cash and cash equivalents of $80 million. Our known liquidity requirements primarily consist of funds necessary to pay for operating expenses and other expenditures, including corporate expenses, taxes, payroll and related benefits, legal costs, operating costs associated with the operation of hotels, interest and scheduled principal payments on our outstanding indebtedness, potential payments related to our interest rate caps, capital expenditures for renovations and maintenance at our hotels, costs associated with our spin-off and the merger, quarterly dividend distribution, and other purchase commitments.

On May 30, 2018, in connection with the spin-off and merger, certain of our indirect wholly-owned subsidiaries (collectively, the “CorePoint CMBS Borrower”), CorePoint TRS L.L.C. (the “Operating Lessee”), and CorePoint Operating Partnership L.P. (the “CorePoint OP”), our wholly-owned subsidiary, entered into a Loan Agreement (the “CMBS Loan Agreement”), pursuant to which the CorePoint CMBS Borrower borrowed an aggregate principal amount of $1.035 billion under a secured mortgage loan secured primarily by mortgages for 307 owned and ground-leased hotels, an excess cash flow pledge for seven owned and ground-leased hotels and other collateral customary for mortgage loans of this type (the “CMBS Facility”). In addition, also on May 30, 2018, CorePoint Borrower L.L.C. (the “CorePoint Revolver Borrower”), our indirect wholly-owned subsidiary and direct wholly-owned subsidiary of CorePoint OP, and CorePoint OP, as a guarantor, entered into a Credit Agreement (the “Revolver Credit Agreement”) providing for a revolving credit facility in an aggregate amount of $150.0 million (the “Revolving Facility”), of which $25.0 million was drawn upon consummation of the spin-off. See “—Debt – Financing Transactions in connection with the spin-off and merger” for a further discussion of our CMBS Facility and our Revolving Facility.

We finance our business activities primarily with existing cash and cash generated from our operations. We believe that this cash will be adequate to meet anticipated requirements for operating expenses and other expenditures, including corporate expenses, payroll and related benefits, legal costs, and purchase commitments for the foreseeable future. The objectives of our cash management policy are to maintain the availability of liquidity and minimize operational costs.

We and our affiliates, and/or our major stockholders and their respective affiliates, may from time to time purchase our outstanding debt through open market purchases, privately negotiated transactions or otherwise. Purchases or retirement of debt, if any, will depend on prevailing market conditions, liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.

In connection with the spin-off and La Quinta merger transaction, the parties agreed to set aside $240 million as a reserve amount to pay certain taxes that will be due as a result of the spin-off and related transactions. CorePoint and its tax advisors are continuing their work to finalize the calculations, but currently believe the $240 million reserve will be more than sufficient to cover the ultimate tax liability, and any residual amount of the reserve above the tax liability will be remitted to CorePoint.

The following table summarizes our net cash flows:

	For the Six Months Ended June 30,						Percent Change
(in millions)	2018			2017			2018 vs. 2017
Net cash provided by operating activities	$	22		$	90			(75.6	)
Net cash used in investing activities		(98	)		(79	)		24.1
Net cash provided by (used in) financing activities		15			(10	)	NM			(1)

(1)Fluctuation in terms of percentage change is not meaningful

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Operating activities

Net cash provided by operating activities was $22 million for the six months ended June 30, 2018, compared to $90 million for the six months ended June 30, 2017. The $68 million decrease was primarily driven by a decrease in results from operations and other noncash items. This decrease also includes the effects of timing differences in our various working capital components including other current assets, accrued payroll and employee benefits.

Investing activities

Net cash used in investing activities during the six months ended June 30, 2018 was $98 million, compared to $79 million during the six months ended June 30, 2017. The $19 million increase in cash used in investing activities was primarily attributable to a decrease in proceeds from sale of assets and an increase in lenders escrow, partially offset by a decrease in capital expenditures.

Financing activities

Net cash provided by (used in) financing activities during the six months ended June 30, 2018 was $15 million compared to $(10) million during the six months ended June 30, 2107. The $25 million increase in cash provided by financing activity was primarily attributable to the financing activity associated with the spin-off, including proceeds from the CMBS Facility and Revolving Facility, costs associated with placing the CMBS Facility, issuance of the mandatorily redeemable preferred shares, investment in an interest rate cap, repayment of the Term Facility (as defined below), and termination of the interest rate swap.

Discontinued Operations

Effective with the closing of the spin-off on May 30, 2018, the results of operations related to the hotel franchise and hotel management business are reported as discontinued operations for all periods presented. In addition, the assets and liabilities of the hotel franchise and hotel management business have been segregated from the assets and liabilities related to the Company’s continuing operations and presented separately on the Company’s comparative balance sheet as of December 31, 2017.

In connection with the spin-off, CorePoint made a cash payment to LQH Parent of approximately $1.002 billion (the “Cash Payment”) immediately prior to and as a condition of the spin-off. The Cash Payment was to facilitate the repayment of part of LQH Parent’s existing debt. In addition, simultaneously with the closing of the merger, Wyndham Worldwide repaid, or caused to be repaid, on behalf of LQH Parent, LQH Parent’s Term Facility.

Capital expenditures

During the six months ended June 30, 2018 and 2017, we made capital expenditures of approximately $93 million and $105 million, respectively.

As of June 30, 2018, we had outstanding commitments under capital expenditure contracts of approximately $19 million related to certain continuing redevelopment and renovation projects and information technology enhancements. If cancellation of a contract occurred, our commitment would be any costs incurred up to the cancellation date, in addition to any costs associated with the discharge of the contract.

Debt

La Quinta debt prior to the spin-off and merger

In April of 2014, LQH refinanced all of its existing debt and accrued interest and related fees. As part of the refinancing, LQH entered into a credit agreement which provided for senior secured credit facilities consisting of:

• a $2.1 billion senior secured term loan facility, which would have matured in 2021; and

• a $250.0 million senior secured revolving credit facility, which would have matured in 2019. The revolving credit facility includes $50 million of borrowing capacity available for letters of credit and borrowing capacity for short-term borrowings referred to as the swing line borrowings.

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In addition, the senior secured credit facilities also provided LQH with the option to raise incremental credit facilities, refinance the loans with debt incurred outside the credit agreement and extend the maturity date of the revolving credit facility and term loans, subject to certain limitations.

Borrowings under the term loans bore interest, at the Borrower’s option, at a rate equal to a margin over either (a) a base rate determined by reference to the highest of (1) the administrative agent’s prime lending rate, (2) the federal funds effective rate plus 1/2 of 1.00% and (3) the LIBOR rate for a one-month interest period plus 1.00% or (b) a LIBOR rate determined by reference to the Reuters LIBOR rate for the interest period relevant to such borrowing. The margin for the term loans was 2.00%, in the case of base rate loans, and 3.00% in the case of LIBOR rate loans, subject to one step-down of 0.25% upon the achievement of a consolidated first lien net leverage ratio (as defined in the credit agreement) of less than or equal to 4.50 to 1.00, subject to a base rate floor of 2.00%, and a LIBOR floor of 1.00%. As of July 31, 2015, LQH achieved a consolidated first lien net leverage ratio of less than 4.50 to 1.00, and, as a result realized the step-down of 0.25% after that date. As of March 6, 2018, LQH’s consolidated first lien net leverage ratio was greater than 4.50 to 1.00, and, as a result LQH realized a margin step-up of 0.25% after that date.

Borrowings under the revolving credit facility bear interest, at the Borrower’s option, at a rate equal to a margin over either (a) a base rate determined by reference to the highest of (1) the administrative agent’s prime lending rate, (2) the federal funds effective rate plus 1/2 of 1.00% and (3) the LIBOR rate for a one-month interest period plus 1.00% or (b) a LIBOR rate determined by reference to the Reuters LIBOR rate for the interest period relevant to such borrowing. The margin for the revolving credit facility was 1.50%, in the case of base rate loans, and 2.50%, in the case of LIBOR rate loans, subject to three step-downs of 0.25% each upon the achievement of a consolidated first lien net leverage ratio of less than or equal to 5.00 to 1.00, 4.50 to 1.00 and 4.00 to 1.00, respectively. As of March 2, 2015, LQH achieved a consolidated first lien net leverage ratio of less than 5.00 to 1.00, and after March 2, 2015 LQH realized the first step-down in margin of 0.25%.  As of July 31, 2015, LQH achieved a consolidated first lien net leverage ratio of less than 4.50 to 1.00, and, as a result realized the second step-down of 0.25% after that date. As of March 6, 2018, LQH’s consolidated first lien net leverage ratio was greater than 4.50 to 1.00, and, as a result LQH realized a margin step-up of 0.25% after that date.

On April 14, 2014, LQH entered into an interest rate swap agreement with an aggregate notional amount of $850.0 million that would have expired on April 14, 2019. This agreement swapped the LIBOR rate in effect under the new credit agreement for this portion of the loan to a fixed-rate of 2.0311%, which includes the 1% LIBOR floor. LQH elected to designate this interest rate swap as a cash flow hedge for accounting purposes.

Financing Transactions in connection with the spin-off and merger

Simultaneously with the closing of the merger, Wyndham repaid, or caused to be repaid, on behalf of LQH Parent, LQH Parent’s existing debt balance.

In addition, in connection with the spin-off and merger, on May 30, 2018, the CorePoint CMBS Borrower, the Operating Lessee, and CorePoint OP entered into the CMBS Loan Agreement, pursuant to which the CorePoint CMBS Borrower borrowed an aggregate principal amount of $1.035 billion under the CMBS Facility. The CMBS Facility has an initial term of two years, with five extension options of twelve months each exercisable at the CorePoint CMBS Borrower’s election provided that CorePoint CMBS Borrower provide Lender at least 30 days’, but not more than 120 days’, notice, there is no event of default existing as of the commencement of the applicable extension period and the CorePoint CMBS Borrower either extends the current interest rate cap or purchases a new interest rate cap covering the extension period at a strike price as set forth in the CMBS Loan Agreement.

As long as LIBOR is able to be determined, the CMBS Facility bears interest at a rate equal to the sum of (i) one-month LIBOR (rounded to the nearest 1/1000th of a percent subject to a floor of 0.00%) and (ii) 2.75% per annum for the first 5 years of the term, 2.90% for the 6th year of the term and 3.00% for the 7th year of the term. In addition, until July 14, 2018, the lender under the CMBS Facility has the right to increase the interest rates by up to 0.75% in order to successfully securitize or otherwise syndicate the entire CMBS Facility, subject to certain conditions. The CMBS Facility has no scheduled amortization payments.

The CMBS Facility is pre-payable in whole or in part subject to payment of (i) in the case of prepayments (other than in certain enumerated cases) made prior to or on the December 2019 payment date (provided that with respect to any prepayment made after the payment date in November 2019, but prior to the December 2019 payment date, the amount of the spread maintenance payment shall be zero), a spread maintenance premium and in certain cases third party LIBOR breakage costs, and (ii) all accrued interest through the date of prepayment prior to a securitization and through the end of the applicable accrual period following a securitization. Notwithstanding the above, the CorePoint CMBS Borrowers are permitted to prepay the CMBS Facility by an amount not to exceed 20% of the original principal balance of the CMBS Facility, in the aggregate without payment of any spread maintenance premium.

CorePoint OP delivered a customary non-recourse guaranty in connection with the CMBS Facility. Under such guaranty, (i) CorePoint OP will agree to indemnify the lender for certain losses arising out of customary “bad-boy” acts of CorePoint OP and its

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affiliates, including the CorePoint CMBS Borrower and (ii) the CMBS Facility will become fully recourse to CorePoint OP upon the occurrence of certain bankruptcy events capped at 10% of the then outstanding principal balance of the CMBS Facility. With respect to environmental matters, the CMBS Facility is recourse to the CorePoint CMBS Borrower only, provided that the required environmental insurance is delivered to the lender.

The CMBS Facility includes certain customary affirmative and negative covenants and events of default, including, among other things, restrictions on the ability of the CorePoint CMBS Borrower to incur additional debt and transfer, pledge or assign certain equity interests or its assets, and covenants requiring the CorePoint CMBS Borrower to exist as “special purpose entities,” maintain certain ongoing reserve funds and comply with other customary obligations for commercial mortgage-backed securities loan financings. As of June 30, 2018, we are in compliance with these covenants.

At the closing of the CMBS Facility, the CorePoint CMBS Borrower deposited with the lender approximately $15 million in upfront reserves for property improvement and environmental remediation, which funds may be periodically disbursed to the CorePoint CMBS Borrower throughout the term of the loan to cover such costs. In addition, revenues to be distributed to the CorePoint CMBS Borrower will be required to be deposited first into a segregated account under the control of the CMBS Facility lender (the “Clearing Account”). All cash in the Clearing Account will be transferred to an account under the control of the Operating Lessee as long as (i) there is no event of default under the loan or (ii) the debt yield for the CMBS Facility (calculated based on the outstanding principal balance of the CMBS Facility) does not fall below (x) 12.33% for the first five years of the CMBS Facility loan term or (y) 12.83% for the sixth and seventh years of the CMBS Facility loan term, in each case for two consecutive calendar quarters. Upon the occurrence and continuation of either (i) or (ii) above, all cash in the Clearing Accounts will be transferred to an account under the control of the lender to be applied to payment of all monthly amounts due under the CMBS Facility loan documents including, but not limited to, debt service for the CMBS Facility and the Revolving Facility, agent fees and expenses, required ongoing reserves, property operating expenses, sales and use taxes and custodial fees. The remaining funds will be deposited into an excess cash flow account, also under the control of the lender, which funds will be available to the CorePoint CMBS Borrower, provided there is no event of default under the loan for payment of, among other things, various operating expenses and dividends, distributions and redemptions sufficient to maintain certain tax-preferential treatment for the CorePoint CMBS Borrower.

Also, on May 30, 2018, the CorePoint Revolver Borrower and CorePoint OP entered into the Revolver Credit Agreement providing for the $150.0 million Revolving Facility, of which $25.0 million was drawn upon consummation of the spin-off. The Revolving Facility will mature on May 30, 2020, with an election to extend the maturity for one additional year subject to certain conditions, including that the maturity of the CMBS Facility be extended to a date no earlier than the maturity of the Revolving Facility.

The interest under the Revolving Facility will be, at the option of the CorePoint Revolver Borrower, either at a base rate plus a margin of 3.50% or a LIBOR rate plus a margin of 4.50%. With respect to base rate loans, interest will be payable at the end of each quarter. With respect to LIBOR loans, interest will be payable at the end of the selected interest period but no less frequently than quarterly. Additionally, there is a commitment fee payable at the end of each quarter equal to 0.50% of unused commitments under the Revolving Facility and customary letter of credit fees.

The Revolving Facility contains customary representations and warranties, affirmative and negative covenants and defaults. The Revolving Facility also contains a maximum total net leverage ratio financial covenant and minimum interest coverage ratio financial covenant, in each case, tested as of the last day of any fiscal quarter in which borrowings under the Revolving Facility and outstanding letters of credit exceed 10% of the aggregate commitments of the Revolving Facility. As of June 30, 2018, we are in compliance with these covenants.

The obligations under the Revolving Facility are unconditionally and irrevocably guaranteed by CorePoint OP, and, subject to certain exceptions, each of the CorePoint Revolver Borrower’s existing and future domestic subsidiaries that own equity interests in any CorePoint CMBS Borrower (collectively, the “Revolver Subsidiary Guarantors”). The CorePoint Revolver Borrower’s obligations under the Revolving Facility and any hedging or cash management obligations are secured by (i) a perfected first-lien pledge of all equity interests in the CorePoint Revolver Borrower, all equity interests in any Revolver Subsidiary Guarantor and, subject to certain exceptions, all equity interests in certain CorePoint CMBS Borrowers and (ii) a perfected first-priority security interest in the CorePoint Revolver Borrower’s conditional controlled deposit account.

In connection with LQH’s internal reorganization prior to the spin-off, the Company issued 15,000 shares of Cumulative Redeemable Series A Preferred Stock, par value $0.01 per share (the “Series A preferred stock”), to La Quinta Intermediate Holdings, L.L.C., a wholly owned subsidiary of LQH Parent. La Quinta Intermediate Holdings, L.L.C. privately sold all of the Series A preferred stock to an unrelated third-party investor immediately prior to the completion of the spin-off.

The Series A preferred stock has an aggregate liquidation preference of $15.0 million, plus any accrued and unpaid dividends thereon. We pay a cash dividend on the Series A preferred stock equal to 13% per annum, payable quarterly. If either our leverage

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ratio exceeds 7.5 to 1.0 as of the last day of any fiscal quarter, or if an event of default occurs (or has occurred and has not been cured) with respect to the Series A preferred stock, we will be required to pay a cash dividend on the Series A preferred stock equal to 15% per annum. Our dividend rate on the Series A preferred stock will increase to 16.5% per annum if, at any time, we are both in breach of the leverage ratio covenant and an event of default occurs (or has occurred and has not been cured) with respect to the Series A preferred stock. The Series A preferred stock are senior to our common stock with respect to dividends and with respect to dissolution, liquidation or winding up of the Company.

Holders of Series A preferred stock generally have no voting rights. However, without the prior consent of the holders of a majority of the outstanding shares of Series A preferred stock, we are prohibited from (i) authorizing or issuing any additional shares of Series A preferred stock, (ii) amending our charter in any manner that would adversely affect the Series A preferred stock, or (iii) entering into, amending or altering any provision of any agreement in a manner that could reasonably be expected to be material and adverse to the Series A preferred stock. In addition, the holders of shares of the Series A preferred stock have certain preemptive rights over the issuance of any capital stock ranking senior to or on parity with the Series A preferred stock. The holders of the Series A preferred stock also have exclusive voting rights on any amendment to our charter that would alter the contract rights of only the Series A preferred stock. If we are either (a) in arrears on the payment of dividends that were due on the Series A preferred stock on six or more quarterly dividend payment dates, whether or not such dates are consecutive, or (b) in default of our obligations to redeem the preferred stock on the tenth anniversary of its issuance or following a change of control, the preferred shareholders may designate a representative to attend meetings of our board of directors as a non-voting observer until all unpaid preferred stock dividends have either been paid or declared with an amount sufficient for payment set aside for payment, or the shares required to be redeemed have been redeemed, as applicable.

The Series A preferred stock is mandatorily redeemable by us upon the tenth anniversary of the date of issuance. Beginning on the seventh anniversary of the issuance of the Series A preferred stock, we may redeem the outstanding Series A preferred stock for an amount equal to its aggregate liquidation preference, plus any accrued but unpaid dividends. The holders of the Series A preferred stock may also require us to redeem the Series A preferred stock upon a change of control of the Company for an amount equal to its aggregate liquidation preference plus any accrued and unpaid dividends thereon (and a premium if the change of control occurs prior to the seventh anniversary of the issuance of the Series A preferred stock).

If we are unable to generate sufficient cash flow from operations in the future to service our debt, we may be required to reduce capital expenditures or refinance all or a portion of our existing debt. Our ability to make scheduled principal payments and to pay interest on our debt depends on the future performance of our operations, which is subject to general conditions in or affecting the hotel industry that are beyond our control. See “Risk Factors—Risks Related to Our Business and Industry” and “Risk Factors—Risks Related to Our Indebtedness” in the Information Statement.

Dividend

As a REIT, we are required to distribute at least 90% of our REIT taxable income, determined without regard to the deduction for dividends paid and excluding net capital gain, to our stockholders on an annual basis. Therefore, as a general matter, it is unlikely that we will be able to retain substantial cash balances that could be used to meet our liquidity needs from our annual taxable income. Instead, we will need to meet these needs from external sources of capital and amounts, if any, by which our cash flow generated from operations exceeds taxable income.

As of June 30, 2018, we had not declared or paid quarterly dividends to holders of our common stock. However, on August 6, 2018, the Board of Directors declared a quarterly cash dividend of $0.067 per share of common stock with respect to the second quarter of 2018, which represents an anticipated regular quarterly dividend of $0.20 per share of common stock prorated for the period from completion of the spin-off on May 30, 2018 through the last day of the second quarter.  The prorated dividend is payable on September 14, 2018 to stockholders of record as of August 30, 2018, with the aggregate cash dividend paid to each stockholder with respect to shares of common stock held by such holder rounded up to the nearest whole cent.  All future dividends will be at the sole discretion of CorePoint’s Board of Directors.          

Contractual obligations

Except as a result of the Financing Transactions and the related impact to interest expense as described above under “Liquidity and Capital Resources―Debt―Financing Transactions in connection with the spin-off and merger,” which description is incorporated herein by reference, there were no significant changes to our contractual obligations since December 31, 2017 and the discussion under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Contractual obligations” in the Information Statement is incorporated herein by reference.

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Off-balance sheet arrangements

We do not have off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

New Accounting Pronouncements

See Note 2 of the notes to our unaudited condensed consolidated financial statements included elsewhere in this report for a description of new accounting pronouncements.

Critical accounting policies and estimates

The preparation of our financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements, the reported amounts of revenues and expenses during the reporting periods and the related disclosures in the condensed consolidated financial statements and accompanying footnotes. On an ongoing basis, we evaluate these estimates and judgments based on historical experiences and various other factors that are believed to reflect the current circumstances. While we believe our estimates, assumptions and judgments are reasonable, they are based on information presently available. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Information Statement describes the critical accounting estimates used in preparation of our condensed consolidated financial statements. Actual results may differ significantly from these estimates due to changes in judgments, assumptions and conditions as a result of unforeseen events or otherwise, which could have a material impact on financial position or results of operations. There have been no material changes to our significant accounting policies as compared to the significant accounting policies described in our Information Statement.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

As of June 30, 2018, we are exposed to market risk primarily from changes in interest rates, which may impact future income, cash flows and fair value of the Company, depending on changes to interest rates. In certain situations, we may seek to reduce cash flow volatility associated with changes in interest rates by entering into financial arrangements intended to provide a hedge against a portion of the risks associated with such volatility. We will continue to have exposure to such risks to the extent they are not hedged. We expect to enter into derivative financial arrangements to the extent they meet the objective described above, or are required by the terms of our debt facilities, and we do not use derivatives for trading or speculative purposes.

Interest rate risk

Our interest rate risk management objectives are to limit the impact of interest rate changes on earnings and cash flows and to lower overall borrowing costs. To achieve the financing objectives, we currently borrow primarily at variable rates with what we believe are the lowest margins available and, in some cases, the ability to convert variable rates to fixed rates either directly or through interest rate hedges. With regard to variable rate financing, we manage interest rate cash flow risk by continually identifying and monitoring changes in interest rate exposures that may adversely impact expected future cash flows and by evaluating hedging opportunities, which to date have included interest rate caps.

On May 30, 2018, CorePoint Lodging completed the Financing Transactions. We are exposed to interest rate risk in connection with the CMBS Facility and the Revolving Facility as the interest on each of the CMBS Facility and the Revolving Facility is floating rate based on LIBOR. The interest rate on the CMBS Facility is one-month LIBOR plus 2.75% per annum through the initial two year period.  The interest rate on the Revolving Facility is one-month LIBOR plus 4.50% per annum. In connection with CorePoint Lodging’s entry into the CMBS Loan Agreement, we entered on May 30, 2018 into an interest rate cap agreement with a notional amount of $1.035 billion and a LIBOR rate cap of 3.25% that expires on July 15, 2020.

Changes in interest rates affect the fair value of our debt. As of June 30, 2018, we did not have any notes receivable or real estate-related securities with variable interest rates. We are exposed to interest rate changes primarily as a result of our variable rate on our outstanding debt. We quantify our exposure to interest rate risk based on how changes in interest rates affect to our cash interest expense. We consider changes in the 30-day LIBOR rate to be most indicative of our interest rate exposure as it is a function of the base rate for our credit facilities and is reasonably correlated to changes in our earnings rate on our cash investments. We consider increases of 0.5% to 2.0% in the 30-day LIBOR rate to be reflective of reasonable changes we may experience in the current interest rate environment. The table below reflects the annual consolidated effect (before any applicable allocation to noncontrolling interest) of an increase in the 30-day LIBOR to our cash interest expense related to our significant variable interest rate exposures for our

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wholly owned assets and liabilities as of June 30, 2018 (amounts in millions, where positive amounts reflect a decrease in cash interest expense and bracketed amounts reflect an increase in cash interest expense):

	Increases in Interest Rates
	2.0%			1.5%			1.0%			0.5%
	(in millions)
CMBS Facility	$	(21	)	$	(16	)	$	(10	)	$	(5	)
Interest rate cap		9			4			—			—
Total	$	(12	)	$	(12	)	$	(10	)	$	(5	)

Refer to our  Note 8 “Fair Value Measurements” in the unaudited condensed consolidated financial statements included elsewhere in this report for further discussion of the fair value measurements of our financial assets and liabilities.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

As of June 30, 2018, the Company’s management has evaluated, with the participation of the Company’s principal executive officer and principal financial officer, the Company’s disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired controls objectives. Based upon that evaluation, the Company’s principal executive officer and principal financial officer have concluded that, as of June 30, 2018, the Company’s disclosure controls and procedures were effective at a reasonable assurance level.

Changes in Internal Control over Financial Reporting

Historically, the Company relied on financial controls and resources of LQH to manage certain aspects of its business and report its results.  As a result of the spin-off, the Company is in the process of reviewing, revising and adopting policies, as needed, to meet all regulatory requirements applicable to it as an independent, publicly traded company.  In addition, in connection with the Company’s spin-off, it entered into a master transition services agreement pursuant to which La Quinta will continue to provide certain information technology, administrative and other services on a transitional basis. The Company will continue to review, document and test its internal controls over financial reporting, and may from time to time make changes aimed at enhancing their effectiveness and to ensure that its systems evolve to meet its needs as an independent, publicly traded company.  These efforts may lead to changes in the Company’s internal control over financial reporting.

Other than those noted above, there were no changes in the internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) of the Company that occurred during the fiscal quarter covered by this report that have materially affected, or are reasonably likely to materially affect, the internal control over financial reporting of the Company.

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PART II—OTHER INFORMATION

Item 1. Legal Proceedings

We are a party to a number of pending claims and lawsuits arising in the normal course of business, including proceedings involving tort and other general liability claims, workers’ compensation and other employee claims and intellectual property claims. We do not consider our ultimate liability with respect to any such claims or lawsuits, or the aggregate of such claims and lawsuits, to be material in relation to our condensed consolidated financial condition, results of operations or our cash flows taken as a whole.

We maintain general and other liability insurance; however, certain costs of defending lawsuits, such as those below the retention or insurance deductible amount, are not covered by or are only partially covered by insurance policies, and our insurance carriers could refuse to cover certain claims in whole or in part. We regularly evaluate our ultimate liability costs with respect to such claims and lawsuits. We accrue costs from litigation as they become probable and estimable.

Item  1A. Risk Factors

There have been no material changes to our principal risks that we believe are material to our business, results of operations and financial condition from the risk factors previously disclosed in our Information Statement, which is accessible on the SEC’s website at www.sec.gov.

Item  2. Unregistered Sales of Equity Securities and Use of Proceeds

Issuer Purchases of Equity Securities

None.

Item 3. Defaults Upon Senior Securities

None.

Item  4. Mine Safety Disclosures

Not applicable.

Item  5. Other Information

Amendment to Articles Supplementary for Series A Preferred Stock

On August 13, 2018, the Company filed with the State Department of Assessments and Taxation of Maryland Articles of Amendment (the “Articles of Amendment”) to the Articles Supplementary for the Series A preferred stock, to, among other things, remove the consent right of holders of shares of the Series A preferred stock over designations or issuances by us of any class or series of our stock ranking on parity with the Series A preferred stock, and instead provide such holders with certain preemptive rights over issuances of such parity stock. As required under the Articles Supplementary, the holders of a majority of the Series A preferred stock approved the Articles of Amendment.

The foregoing description does not purport to be complete and is qualified in its entirety by reference to the Articles of Amendment, which are filed as Exhibit 3.3 hereto.

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Item  6. Exhibits

The following is a list of all exhibits filed or furnished as part of this report:

Exhibit No.	Description
2.1	Separation and Distribution Agreement, dated as of January 17, 2018, by and between La Quinta Holdings Inc. and CorePoint Lodging Inc. (incorporated by reference to Exhibit 2.1 to the Registrant’s Registration Statement on Form 10 filed on May 7, 2018 (File no. 001-38168))
3.1	Articles of Amendment and Restatement of CorePoint Lodging Inc. (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on June 4, 2018 (File no. 001-38168))
3.2	Articles Supplementary of CorePoint Lodging Inc. (incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K filed on June 4, 2018 (File no. 001-38168))
3.3	Articles of Amendment to Articles Supplementary of CorePoint Lodging Inc.
3.4	Bylaws of CorePoint Lodging Inc. (incorporated by reference to Exhibit 3.3 to the Registrant’s Current Report on Form 8-K filed on June 4, 2018 (File no. 001-38168))
10.1	Tax Matters Agreement, dated as of May 30, 2018, between La Quinta Holdings Inc. and CorePoint Lodging Inc. (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on June 4, 2018 (File no. 001-38168))
10.2	Transition Services Agreement, dated as of May 30, 2018, between La Quinta Holdings Inc. and CorePoint Lodging Inc. (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed on June 4, 2018 (File no. 001-38168))
10.3	Stockholders Agreement, dated as of May 30, 2018, by and among CorePoint Lodging Inc. and the other parties thereo (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed on June 4, 2018 (File no. 001-38168))
10.4	Registration Rights Agreement, dated as of May 30, 2018, by and among CorePoint Lodging Inc. and certain of its stockholders (incorporated by reference to Exhibit 10.4 to the Registrant’s Current Report on Form 8-K filed on June 4, 2018 (File no. 001-38168))
10.5	Loan Agreement, dated as of May  30, 2018, by and among CPLG Properties L.L.C., CPLG FL Properties L.L.C., CPLG TX Properties L.L.C., CPLG Bloomington L.L.C., CPLG Santa Ana L.L.C., CPLG Ft. Meyers L.L.C., CPLG St. Albans L.L.C., CPLG Thousand Oaks L.L.C., CPLG West Palm Beach L.L.C., CPLG Charlotte L.L.C., CPLG Acquisition Properties L.L.C., CPLG Fort Lauderdale L.L.C., CPLG Chicago L.L.C., CPLG Garden City L.L.C., CPLG Charleston L.L.C., CPLG South Burlington L.L.C., CPLG Virginia Beach L.L.C., CPLG Islip L.L.C., CPLG Rancho Cordova L.L.C., CPLG Prime Mezz L.L.C., CPLG Wellesley Properties L.L.C., CPLG Portfolio East L.L.C. and CPLG MD Business L.L.C., CorePoint TRS L.L.C., CorePoint Operating Partnership L.P. and JPMorgan Chase Bank, National Association, as lender (incorporated by reference to Exhibit 10.5 to the Registrant’s Current Report on Form 8-K filed on June 4, 2018 (File no. 001-38168))
10.6	First Amendment to Loan Agreement and Omnibus Amendment to Other Loan Documents, dated as of June 12, 2018, by and among JPMorgan Chase Bank, National Association and Parlex 4 Finance, LLC, as co-lenders, and CPLG Properties L.L.C., CPLG FL Properties L.L.C., CPLG TX Properties L.L.C., CPLG Bloomington L.L.C., CPLG Santa Ana L.L.C., CPLG Ft. Meyers L.L.C., CPLG St. Albans L.L.C., CPLG Thousand Oaks L.L.C., CPLG West Palm Beach L.L.C., CPLG Charlotte L.L.C., CPLG Acquisition Properties L.L.C., CPLG Fort Lauderdale L.L.C., CPLG Chicago L.L.C., CPLG Garden City L.L.C., CPLG Charleston L.L.C., CPLG South Burlington L.L.C., CPLG Virginia Beach L.L.C., CPLG Islip L.L.C., CPLG Rancho Cordova L.L.C., CPLG Prime Mezz L.L.C., CPLG Wellesley Properties L.L.C., CPLG Portfolio East L.L.C. and CPLG MD Business L.L.C., CorePoint TRS L.L.C., CorePoint Operating Partnership L.P.

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Exhibit No.	Description
10.7	Second Amendment to Loan Agreement and Omnibus Amendment to Other Loan Documents, dated as of July 6, 2018 by and among JPMorgan Chase Bank, National Association and Parlex 4 Finance, LLC, as co-lenders, and CPLG Properties L.L.C., CPLG FL Properties L.L.C., CPLG TX Properties L.L.C., CPLG Bloomington L.L.C., CPLG Santa Ana L.L.C., CPLG Ft. Meyers L.L.C., CPLG St. Albans L.L.C., CPLG Thousand Oaks L.L.C., CPLG West Palm Beach L.L.C., CPLG Charlotte L.L.C., CPLG Acquisition Properties L.L.C., CPLG Fort Lauderdale L.L.C., CPLG Chicago L.L.C., CPLG Garden City L.L.C., CPLG Charleston L.L.C., CPLG South Burlington L.L.C., CPLG Virginia Beach L.L.C., CPLG Islip L.L.C., CPLG Rancho Cordova L.L.C., CPLG Prime Mezz L.L.C., CPLG Wellesley Properties L.L.C., CPLG Portfolio East L.L.C. and CPLG MD Business L.L.C., CorePoint TRS L.L.C., CorePoint Operating Partnership L.P.
10.8	Guaranty Agreement by CorePoint Operating Partnership L.P. in favor of JPMorgan Chase Bank, National Association, as lender (incorporated by reference to Exhibit 10.6 to the Registrant’s Current Report on Form 8-K filed on June 4, 2018 (File no. 001-38168))
10.9	Credit Agreement, dated as of May  30, 2018, among CorePoint Borrower L.L.C., CorePoint Operating Partnership L.P., JPMorgan Chase Bank N.A., as administrative agent and the other parties party thereto (incorporated by reference to Exhibit 10.7 to the Registrant’s Current Report on Form 8-K filed on June 4, 2018 (File no. 001-38168))
10.10	Guaranty and Security Agreement, dated as of May  30, 2018, among CorePoint Borrower, L.L.C., CorePoint Operating Partnership L.P., the subsidiary guarantors party thereto and JPMorgan Chase Bank, N.A., as the administrative agent. (incorporated by reference to Exhibit 10.8 to the Registrant’s Current Report on Form 8-K filed on June 4, 2018 (File no. 001-38168))
10.11	CorePoint Lodging 2018 Omnibus Incentive Plan, dated as of May 30, 2018 (incorporated by reference to Exhibit 10.9 to the Registrant’s Current Report on Form 8-K filed on June 4, 2018 (File no. 001-38168))
10.12	CorePoint Lodging Inc. Executive Severance Plan
10.13	Form of Restricted Stock Grant Notice under the CorePoint Lodging Inc. 2018 Omnibus Incentive Plan (Time-Based Vesting Award – Four-Year FIG)
10.14	Form of Restricted Stock Grant Notice under the CorePoint Lodging Inc. 2018 Omnibus Incentive Plan (Time-Based Vesting Award – Three-Year FIG)
10.15	Form of Restricted Stock Grant Notice under the CorePoint Lodging Inc. 2018 Omnibus Incentive Plan (Time-Based Vesting Award – Employees)
10.16	Form of Restricted Stock Grant Notice under the CorePoint Lodging Inc. 2018 Omnibus Incentive Plan (Time-Based Vesting Award – Non-Employee Directors)
10.17	Form of Restricted Stock Grant Notice under the CorePoint Lodging Inc. 2018 Omnibus Incentive Plan (Time-Based Vesting Award – Substitute Award – La Quinta Restricted Stock Awards)
10.18	Form of Restricted Stock Grant Notice under the CorePoint Lodging Inc. 2018 Omnibus Incentive Plan (Time-Based Vesting Award – Substitute Award – La Quinta Performance Share Unit Awards)
10.19	Form of Restricted Stock Grant Notice under the CorePoint Lodging Inc. 2018 Omnibus Incentive Plan (Time-Based Vesting Award – Substitute Award – La Quinta Retention Award)
10.20	Form of Restricted Stock Unit Grant Notice under the CorePoint Lodging Inc. 2018 Omnibus Incentive Plan (Non-Employee Directors – Substitute Award)
10.21	Amended and Restated Executive Employment Agreement, dated as of August 20, 2003, between Wyndham International, Inc. and Mark Chloupek
10.22	Assumption of Employment Agreement, dated as of October 31, 2013, by LQ Management L.L.C.

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Exhibit No.	Description
10.23	Offer Letter, dated June 21, 2018, between CorePoint Lodging Inc. and Howard S. Garfield (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2018 (File no. 001-38168))
31.1	Certification of Periodic Report by Chief Executive Officer under Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of Periodic Report by Chief Financial Officer under Section 302 of the Sarbanes-Oxley Act of 2002
32.1	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
32.2	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
101.INS	XBRL Instance Document
101.SCH	XBRL Taxonomy Extension Schema Document
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

The agreements and other documents filed as exhibits to this report are not intended to provide factual information or other disclosure other than with respect to the terms of the agreements or other documents themselves, and you should not rely on them for that purpose. In particular, any representations and warranties made by us in these agreements or other documents were made solely within the specific context of the relevant agreement or document and may not describe the actual state of affairs as of the date they were made or at any other time.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	COREPOINT LODGING INC.
	(Registrant)
Date: August 14, 2018	By:	/s/ Keith A. Cline
		Keith A. Cline
		President and Chief Executive Officer
		(Principal Executive Officer)
Date: August 14, 2018	By:	/s/ Daniel E. Swanstrom II
		Daniel E. Swanstrom II
		Executive Vice President and Chief Financial Officer
		(Principal Financial Officer)

54

EX-3.3

Exhibit 3.3

COREPOINT LODGING INC.

ARTICLES OF AMENDMENT

CorePoint Lodging Inc., a Maryland corporation (the “Corporation”), does hereby certify to the State Department of Assessments and Taxation of Maryland that:

FIRST:  The charter of the Corporation (the “Charter”) is hereby amended by deleting existing Section 7 of the Articles Supplementary, dated May 30, 2018 (the “Articles Supplementary”), regarding certain rights of the shares of preferred stock, par value $0.01 per share, of the Corporation designated as Cumulative Redeemable Series A Preferred Stock (“Series A Preferred Stock”) in its entirety and inserting in lieu thereof a new Section 7 to read as follows:

Changes Affecting Series A Preferred Stock

.  

(a)So long as any shares of Series A Preferred Stock are outstanding, the Corporation shall not, without first obtaining the affirmative vote or written consent of the Holders of at least a majority of the total number of shares of Series A Preferred Stock then outstanding, voting as a separate class:

(i)amend, alter or repeal the Charter, including these Articles Supplementary, in any manner that would adversely affect the powers, preferences, privileges or rights of the Series A Preferred Stock whether by recapitalization, reorganization, reclassification, merger, consolidation, transfer or conveyance of all or substantially all of its assets or otherwise (an “Event”); providedhowever, with respect to the occurrence of any of the foregoing Events, so long as the Series A Preferred Stock remains outstanding with the terms thereof unchanged in any material respect or the Holders receive stock of the successor with substantially identical powers, preferences, privileges and rights as the Series A Preferred Stock, taking into account that, upon the occurrence of such Event, the Corporation may not be the surviving entity, the occurrence of such Event shall not be deemed to adversely affect such powers, preferences, privileges or rights of the Series A Preferred Stock, and in such case such Holders shall not have any voting rights with respect to the occurrence of any such Event, and, providedfurther, that the creation or issuance, or any increase in the amounts authorized, of any class or series of Junior Stock that the Corporation may issue shall not be deemed to adversely affect the powers, preferences, privileges or rights of the Series A Preferred Stock;

(ii)designate or issue any Senior Stock, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such stock;

(iii)authorize, create or issue, or increase or decrease the authorized or issued amount of, shares of Series A Preferred Stock; or

(iv)enter into, amend or alter any provision of any agreement or other instrument binding upon the Corporation or any of its subsidiaries to the extent that such agreement or other instrument (or amendment or alteration thereto) would reasonably be

expected to be material and adverse to the powers, preferences, privileges or rights of the Series A Preferred Stock under these Articles Supplementary.

(b)On each matter on which Holders are entitled to vote, each share of Series A Preferred Stock will be entitled to one vote.

(c)The Holders shall have exclusive voting rights on any Charter amendment that would alter the contract rights, as expressly set forth in the Charter, of only the Series A Preferred Stock.

(d)The Corporation shall not, by amendment of its Charter or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Corporation, but shall at all times in good faith assist in the carrying out of all the provisions of these Articles Supplementary of Series A Preferred Stock and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the Holders against impairment.

(e)

(i)So long as any shares of Series A Preferred Stock are outstanding, the Corporation shall give each Holder notice (an “Issuance Notice”) of any proposed issuance by the Corporation of any Parity Stock (or any obligation or security convertible into or evidencing the right to purchase any such stock) (“Parity Securities”) at least 10 Business Days prior to the proposed issuance date.  An Issuance Notice shall specify the price at which such Parity Securities are to be issued, the aggregate size of the proposed issuance, and in reasonable detail the other material terms of the issuance.  Each Holder shall be entitled to purchase up to such Holder’s Pro Rata Share of the Parity Securities proposed to be issued, at the price and on the terms specified in such Issuance Notice; provided, however, that such right shall be subject to the restrictions on ownership and transfer set forth in Article VII of the Charter.  “Pro Rata Share” means, with respect to a Holder, the fraction that results from dividing (A) the total amount of the liquidation value of the shares of Series A Preferred Stock and Parity Securities held by such Holder (immediately before giving effect to the proposed issuance) by (B) the total amount of the liquidation value of all outstanding shares of Series A Preferred Stock and Parity Securities (immediately before giving effect to such proposed issuance).  For the avoidance of doubt, no Holder may assign to any Person its rights under this ‎Section 7(e) to elect to purchase up to its Pro Rata Share of the Parity Securities.

(ii)Each Holder who desires to purchase any or all of its Pro Rata Share of the Parity Securities specified in an Issuance Notice shall deliver notice to the Corporation (each, an “Exercise Notice”) of its election to purchase such Parity Securities within five Business Days of receipt of such Issuance Notice.  An Exercise Notice shall specify the amount of Parity Securities to be purchased by such Holder and shall constitute exercise by such Holder of its rights under this ‎Section 7(e) and an irrevocable and binding obligation of such Holder to purchase, at the price and on the terms specified in such Issuance Notice, the amount of Parity Securities specified in such Exercise Notice.  If, at the termination of such five-Business Day period, such Holder shall not have timely delivered an Exercise Notice to the Corporation, such Holder shall

2

be deemed to have waived all of its rights under this ‎Section 7(e) with respect to the purchase of such Parity Securities (but not with respect to any future issuance).  

(iii)The Corporation shall have 90 days from the date of an Issuance Notice to consummate the proposed issuance and sale of any or all of such Parity Securities that the Holders have not elected to purchase pursuant to the foregoing ‎Section 7(e)(ii) at the price and upon terms that are not less favorable to the Corporation than those specified in such Issuance Notice; provided, that such 90-day period shall be extended to 120 days to the extent necessary to comply with any regulatory requirements applicable to such proposed issuance.  If the Corporation proposes to issue any such Parity Securities after such period, it shall again comply with the procedures set forth in this ‎Section 7(e).  Any proposed issuance of Parity Securities shall be in the sole discretion of the Board and the Corporation shall be under no obligation to consummate any proposed issuance of Parity Securities.  The Corporation shall not be liable to any Holder if the Corporation has not consummated any proposed issuance of Parity Securities pursuant to this Section 7(e) for any reason.  

(iv)At the consummation of the issuance of such Parity Securities, the Corporation shall issue Parity Securities to be purchased by each Holder exercising preemptive rights pursuant to this ‎Section 7(e) registered in the name of such Holder, against payment by such Holder of the purchase price for such Parity Securities, in accordance with the terms and conditions as specified in such Issuance Notice.  Each Holder purchasing Parity Securities pursuant to this Section 7(e) shall take or cause to be taken all such reasonable actions as are reasonably necessary in order to consummate such purchase.  

(v)Notwithstanding anything contained in this ‎Section 7(e), a Holder or other purchaser (for purposes of this ‎‎Section 7(e)(v), the “Purchaser”) may purchase Parity Securities without the Corporation first complying with the provisions of this ‎Section 7(e); provided (A) the Corporation gives prompt written notice to each Holder other than the Purchaser and (ii) the Purchaser and the Corporation take all steps necessary to enable the Holders other than the Purchaser to effectively exercise their respective rights under this ‎Section 7(e) with respect to their purchase of a Pro Rata Share (based on ownership of shares of Series A Preferred Stock and Parity Securities immediately prior to the issuance of Parity Securities to the Purchaser pursuant to this ‎‎Section 7(e)(v)) of the Parity Securities issued to the Purchaser (whether pursuant to the resale of Parity Securities by the Purchaser of such Parity Securities or the issuance by the Corporation of additional Parity Securities) as promptly as reasonably practicable and in any event not less than 30 days following such purchase by the Purchaser on the terms specified in this ‎Section 7(e).

SECOND:  There has been no change in the authorized stock of the Corporation effected by the amendment to the Charter as set forth above.

THIRD:  The amendment to the Charter as set forth above has been duly advised by the Board of Directors of the Corporation and approved by the stockholders of the Corporation entitled to vote thereon as required by law.

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FOURTH: These Articles of Amendment shall be effective at the time the State Department of Assessments and Taxation of Maryland accepts these Articles of Amendment for record.

FIFTH:  The undersigned officer of the Corporation acknowledges these Articles of Amendment to be the act of the Corporation and, as to all matters or facts required to be verified under oath, the undersigned officer of the Corporation acknowledges that, to the best of his knowledge, information and belief, these matters and facts are true in all material respects and that this statement is made under the penalties for perjury.

4

IN WITNESS WHEREOF, the Corporation has caused these Articles of Amendment to be executed and acknowledged in its name and on its behalf by its Executive Vice President and Chief Financial Officer and attested to by its Secretary as of this 13th day of August, 2018.

COREPOINT LODGING INC.

/s/ Daniel E. Swanstrom

Name:  Daniel E. Swanstrom II

Title:    Executive Vice President and Chief Financial Officer

ATTEST:

/s/ Mark M. Chloupek

Name:  Mark M. Chloupek

Title:    Secretary

EX-10.6

Exhibit 10.6

FIRST AMENDMENT TO LOAN AGREEMENT AND OMNIBUS AMENDMENT TO
OTHER LOAN DOCUMENTS

THIS FIRST AMENDMENT TO LOAN AGREEMENT AND OMNIBUS AMENDMENT TO OTHER LOAN DOCUMENTS (this “Agreement”) is made as of this 12^th day of June, 2018, by and among JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, a banking association chartered under the laws of the United States of America (“Initial Lender”), having an address at 383 Madison Avenue, New York, New York 10179 and PARLEX 4 FINANCE, LLC, a Delaware limited liability company, having an address at c/o Blackstone Mortgage Trust, Inc., 345 Park Avenue, New York, New York 10154 (“Note A-2 Lender”; Note A-2 Lender, together with Initial Lender and each of their respective successors and/or assigns, each a “Co-Lender” and, collectively, “Lender”), THE ENTITIES SET FORTH ON SCHEDULE I ATTACHED HERETO, each having its principal place of business at c/o CorePoint Lodging Inc., MacArthur Ridge II, 909 Hidden Ridge Boulevard, Irving, Texas 75038 (together with their respective successors and assigns, each, an “Individual Borrower” and, collectively, “Borrower”) and COREPOINT TRS L.L.C., having its principal place of business at c/o CorePoint Lodging Inc., MacArthur Ridge II, 909 Hidden Ridge Boulevard, Irving, Texas 75038 (together with its respective successors and assigns, “Operating Lessee”).

W I T N E S S E T H:

WHEREAS, Borrower, Operating Lessee and Initial Lender entered into that certain Loan Agreement, dated as of May 30, 2018 (the “Original Loan Agreement”) (the Original Loan Agreement, as amended by this Agreement and as same may further amended, restated, replaced, supplemented or otherwise modified from time to time, collectively, the “Loan Agreement”) pursuant to which Initial Lender made a loan to Borrower and Operating Lessee in the original principal amount of $1,035,000,000.00 (the “Loan”);

WHEREAS, pursuant to the terms, provisions and conditions set forth in that certain Post-Closing Letter dated as of May 30, 2018, Initial Lender, Borrower and Operating Lessee agreed to revise the Debt Yield thresholds in the Original Loan Agreement (the “Updated Debt Yield Thresholds”) based on updated financial statements provided by Borrower to Initial Lender;

WHEREAS, Initial Lender assigned its right, title and interest in the Note A-2 (as defined in the Loan Agreement) to Note A-2 Lender prior to the date hereof; and

WHEREAS, to evidence the Updated Debt Yield Thresholds, Borrower, Operating Lessee and Lender desire to amend certain provisions of the Loan Agreement and the other Loan Documents and Borrower, Operating Lessee and Lender have agreed in the manner hereinafter set forth to modify the terms of the Loan Agreement and the other Loan Documents.

NOW, THEREFORE, in consideration of the mutual promises and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Borrower and Lender hereby agree as follows:

1.Section 1.1 of the Original Loan Agreement is hereby amended to delete the definition of “Closing Date Debt Yield” in its entirety and to replace it with the following:

““Closing Date Debt Yield” shall mean sixteen and forty-four hundredths percent (16.44%).”

2.Section 1.1 of the Original Loan Agreement is hereby amended to delete the definition of “Required Debt Yield” in its entirety and to replace it with the following:

““Required Debt Yield” shall mean a Debt Yield, as determined by Lender, equal to (i) with respect to the initial term of the Loan and the first, second and third Extension Terms, twelve and thirty-three hundredths percent (12.33%) and (ii) with respect to the fourth and fifth Extension Terms, twelve and eighty-three hundredths percent (12.83%).”

3.Section 2.5.2(e) of the Original Loan Agreement is hereby deleted in its entirety and replaced with the following:

“(e) After giving effect to any such release occurring on such date, the Debt Yield as determined by Lender for the Properties then remaining subject to the Liens of the Mortgages shall be equal to or greater than the greater of (x) the Closing Date Debt Yield and (y) the lesser of (I) the Debt Yield for all of the Properties subject to the Liens of the Mortgages immediately prior to giving effect to all applicable releases and (II) sixteen and ninety-four hundredths percent 16.94% (the “Release Debt Yield”).”

4.From and after the date hereof, (i) all references in the Loan Agreement to “this Agreement”, “hereunder”, “hereof” or words of like import referring to the Loan Agreement shall mean the Loan Agreement as amended by this Agreement, (ii) all references in the other Loan Documents to the “Loan Agreement” shall mean the Loan Agreement, as amended by this Agreement, (iii) all references in the Loan Documents to “this Agreement”, “hereunder”, “hereof” or words of like import referring to such Loan Document shall mean the corresponding Loan Document as amended by this Agreement, (iv) all references in the Loan Documents to the “Loan Documents” shall mean the Loan Documents as amended by this Agreement, collectively (and any reference to any particular Loan Document shall mean the corresponding Loan Document as amended by this Agreement) and (v) all terms in the Loan Documents which, by the terms thereof, have the meanings set forth in the “Loan Agreement” shall have the respective meanings set forth in the Loan Agreement as amended by this Agreement.

5.Except as otherwise expressly modified hereby, all terms, covenants and provisions of each Loan Documents are ratified and confirmed and shall remain in full force and effect as first written.

6.Any and all guaranties and indemnities for the benefit of Lender (including, without limitation, (a) that certain Guaranty Agreement, dated as of May 30, 2018, from Guarantor, to Lender, and (b) that certain Environmental Indemnity Agreement, dated as of May 30, 2018, from Borrower and Operating Lessee to Lender) shall not be released, diminished, impaired, reduced or adversely affected by this Agreement, and all obligations thereunder shall remain in full force and effect in accordance with their respective terms.

7.The execution, delivery and effectiveness of this Agreement shall not, except to the extent expressly provided herein, operate as a waiver of any right, power or remedy of Lender under the Loan Agreement or any of the other Loan Documents, nor constitute a waiver of any provision of the Loan Agreement or any of the other Loan Documents by any of the parties hereto.

8.Should any provision of this Agreement require judicial interpretation, it is agreed that a court interpreting or construing the same shall not apply a presumption that the terms hereof shall be more strictly construed against any party by reason of the rule of construction that a document is to be construed more strictly against the party who itself or through its agent prepared or drafted the same, it being agreed that all parties to this Agreement participated in the preparation hereof.

9.This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.

10.Borrower, Operating Lessee and Lender hereby ratify and confirm the Loan Agreement and all other Loan Documents, in each case, as modified hereby. Except as modified and amended by this Agreement, the Loan, the Loan Agreement and the other Loan Documents and the respective obligations of Lender, Borrower and Operating Lessee thereunder shall be and remain unmodified and in full force and effect.

11.No further modification, amendment, extension, discharge, termination or waiver hereof shall be effective unless the same shall be in a writing signed by the party against whom enforcement is sought, and then such waiver or consent shall be effective only in the specific instance, and for the purpose, for which given.

12.This Agreement shall be construed and enforced in accordance with the laws of the State of New York. If any provision hereof is not enforceable, the remaining provisions of this Agreement shall be enforced in accordance with their terms.

13.This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument.

14.This Agreement constitutes the entire agreement between Borrower, Operating Lessee and Lender with respect to subject matter hereof and supersedes all other prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof.

15.The recitals hereto are hereby incorporated into this Agreement as if fully set forth herein. All capitalized terms used herein and not otherwise defined herein shall have the respective meanings set forth in the Loan Agreement.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first set forth above.

BORROWER:

CPLG TX PROPERTIES L.L.C.,

CPLG PROPERTIES L.L.C.,

CPLG FL PROPERTIES L.L.C.,

CPLG BLOOMINGTON L.L.C.,

CPLG SANTA ANA L.L.C.,

CPLG PRIME MEZZ L.L.C.,

CPLG PORTFOLIO EAST L.L.C.,

CPLG WELLESLEY PROPERTIES L.L.C.,

CPLG MD BUSINESS L.L.C.,

CPLG ST. ALBANS L.L.C.,

CPLG WEST PALM BEACH L.L.C.,

CPLG ACQUISITION PROPERTIES L.L.C.,

CPLG CHICAGO L.L.C.,

CPLG CHARLESTON L.L.C.,

CPLG VIRGINIA BEACH L.L.C.,

CPLG RANCHO CORDOVA L.L.C.,

CPLG FT. MYERS L.L.C.,

CPLG THOUSAND OAKS L.L.C,

CPLG CHARLOTTE L.L.C.,

CPLG FORT LAUDERDALE L.L.C.,

CPLG GARDEN CITY L.L.C.,

CPLG SOUTH BURLINGTON L.L.C.,

CPLG ISLIP L.L.C., each a Delaware limited liability company

By: /s/ David Bradtke
Name: David Bradtke
Title: Senior Vice President, Tax

OPERATING LESSEE:

COREPOINT TRS L.L.C., each a Delaware limited liability company

By: /s/ David Bradtke
Name: David Bradtke
Title: Senior Vice President, Tax

ACKNOWLEDGED AND AGREED:

GUARANTOR:

COREPOINT OPERATING PARTNERSHIP
L.P., a Delaware limited partnership

By: CorePoint OP GP L.L.C., its general partner

By: /s/ David Bradtke
Name: David Bradtke
Title: Senior Vice President, Tax

LENDER:

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION

By: /s/ Simon B. BruceName: Simon B. Bruce
Title: Vice President

LENDER:

PARLEX 4 FINANCE, LLC

By: /s/ Katie KeenanName: Katie Keenan
Title: Managing Director

SCHEDULE I
BORROWER

1.CPLG TX PROPERTIES L.L.C.

2.CPLG PROPERTIES L.L.C.

3.CPLG FL PROPERTIES L.L.C.

4.CPLG FT. MYERS L.L.C.

5.CPLG THOUSAND OAKS L.L.C.

6.CPLG CHARLOTTE L.L.C.

7.CPLG FORT LAUDERDALE L.L.C.

8.CPLG GARDEN CITY L.L.C.

9.CPLG SOUTH BURLINGTON L.L.C.

10.CPLG ISLIP L.L.C.

11.CPLG ST. ALBANS L.L.C.

12.CPLG WEST PALM BEACH L.L.C.

13.CPLG ACQUISITION PROPERTIES L.L.C.

14.CPLG CHICAGO L.L.C.

15.CPLG CHARLESTON L.L.C.

16.CPLG VIRGINIA BEACH L.L.C.

17.CPLG RANCHO CORDOVA L.L.C.

18.CPLG WELLESLEY PROPERTIES L.L.C.

19.CPLG MD BUSINESS L.L.C.

20.CPLG BLOOMINGTON L.L.C.

21.CPLG SANTA ANA L.L.C.

22.CPLG PRIME MEZZ L.L.C.

23.CPLG PORTFOLIO EAST L.L.C.

EX-10.7

Exhibit 10.7

Second AMENDMENT TO LOAN AGREEMENT AND OMNIBUS AMENDMENT TO OTHER LOAN DOCUMENTS

THIS SECONDAMENDMENT TO LOAN AGREEMENT AND OMNIBUS AMENDMENT TO OTHER LOAN DOCUMENTS (this “Agreement”) is made as of this 6th day of July, 2018, by and among JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, a banking association chartered under the laws of the United States of America (“Initial Lender”), having an address at 383 Madison Avenue, New York, New York 10179 and PARLEX 4 FINANCE, LLC, a Delaware limited liability company, having an address at c/o Blackstone Mortgage Trust, Inc., 345 Park Avenue, New York, New York 10154 (“Note A-2 Lender”; Note A-2 Lender, together with Initial Lender and each of their respective successors and/or assigns, each a “Co‑Lender” and, collectively, “Lender”), THE ENTITIES SET FORTH ON SCHEDULE I ATTACHED HERETO, each having its principal place of business at c/o CorePoint Lodging Inc., MacArthur Ridge II, 909 Hidden Ridge Boulevard, Irving, Texas 75038 (together with their respective successors and assigns, each, an “Individual Borrower” and, collectively, “Borrower”) and COREPOINT TRS L.L.C., having its principal place of business at c/o CorePoint Lodging Inc., MacArthur Ridge II, 909 Hidden Ridge Boulevard, Irving, Texas 75038 (together with its respective successors and assigns, “Operating Lessee”).

W I T N E S S E T H:

WHEREAS, Borrower, Operating Lessee and Initial Lender entered into that certain Loan Agreement, dated as of May 30, 2018, as amended by that certain First Amendment to Loan Agreement and Omnibus Amendment to Other Loan Documents, dated as of June 12, 2018, by and among Borrower, Operating Lessee and Lender (as amended, the “Original Loan Agreement”) (the Original Loan Agreement, as amended by this Agreement and as the same may further amended, restated, replaced, supplemented or otherwise modified from time to time, collectively, the “Loan Agreement”) pursuant to which Initial Lender made a loan to Borrower and Operating Lessee in the original principal amount of $1,035,000,000.00 (the “Loan”);

WHEREAS, Initial Lender assigned its right, title and interest in the Note A-2 (as defined in the Loan Agreement) to Note A-2 Lender prior to the date hereof; and

WHEREAS, Borrower, Operating Lessee and Lender desire to amend certain provisions of the Loan Agreement and the other Loan Documents and Borrower, Operating Lessee and Lender have agreed in the manner hereinafter set forth to modify the terms of the Loan Agreement and the other Loan Documents.

NOW, THEREFORE, in consideration of the mutual promises and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Borrower, Operating Lessee and Lender hereby agree as follows:

1.Section 1.1 of the Original Loan Agreement is hereby amended to delete the definition of “Component” in its entirety and to replace it with the following:

““Component” shall mean, individually, any one of Component A, Component B, Component C, Component D, Component E and Component HRR, and “Components” shall mean, collectively, Component A, Component B, Component C, Component D, Component E and Component HRR.”

2.Section 1.1 of the Original Loan Agreement is hereby amended to delete the definition of “Component F” in its entirety and to replace it with the following:

““Component HRR” shall mean the component of the Loan designated as “HRR” in Section 2.1.5 hereof.”

3.Section 1.1 of the Original Loan Agreement is hereby amended to delete the definition of “LIBOR Rate Spread” in its entirety and to replace it with the following:

““LIBOR Rate Spread” shall mean, with respect to each Component the following amounts, as the same may be reallocated pursuant to, and in accordance with the restrictions and limitations contained in Section 9.1.2 and which shall be increased for each Component by 15 basis points (0.15%) from and after the Interest Period applicable to the Payment Date in July, 2023 in accordance with Section 2.8(d), without duplication of any increase with respect to the Prime Rate Spread or the Alternate Rate Spread in accordance with Section 2.8(d), as applicable, and an additional 10 basis points (0.10%) from and after the Interest Period applicable to the Payment Date in July, 2024 in accordance with Section 2.8(e), without duplication of any increase with respect to the Prime Rate Spread or the Alternate Rate Spread in accordance with Section 2.8(e), as applicable:

(a)Component A:2.293208203%

(b)Component B:2.593208203%

(c)Component C:2.893208203%

(d)Component D:3.393208203%

(e)Component E:3.008400000%

(f)Component HRR:3.945268687%”

4.Section 2.1.5 of the Original Loan Agreement is hereby deleted in its entirety and replaced with the following:

“Components of the Loan.  For the purpose of computing interest payable from time to time on the principal amount of the Loan and certain other computations set forth herein, the principal balance of the Loan shall be divided into Components A, B, C, D, E and HRR.  The principal amount of the Components shall be as follows:

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COMPONENT	PRINCIPAL AMOUNT
A	$486,000,000
B	$127,000,000
C	$86,000,000
D	$130,000,000
E	$107,000,000
HRR	$99,000,000

5.Section 2.3.1 of the Original Loan Agreement is hereby deleted in its entirety and replaced with the following:

“2.3.1Monthly Debt Service Payments.  Borrower shall pay to Lender (a) on the Closing Date, an amount equal to interest only on the outstanding principal balance of the Loan from the Closing Date up to and including June 14, 2018, which interest shall be calculated in accordance with the provisions of Section 2.2 hereof and (b) on each Payment Date commencing on the Payment Date occurring in July, 2018 and on each Payment Date thereafter up to and including the Maturity Date, Borrower shall make a payment to Lender equal to the Monthly Debt Service Payment Amount, which payments shall be applied first to interest due for the related Interest Period and then to any other amounts due and unpaid pursuant to this Agreement and the other Loan Documents.  The Monthly Debt Service Payment Amount paid pursuant to this Section 2.3.1 shall be applied:  (i) first, to the payment of interest due and payable on Component A; (ii) second, to the payment of interest due and payable on Component B; (iii) third, to the payment of interest due and payable on Component C; (iv) fourth, to the payment of interest due and payable on Component D; (v) fifth, to the payment of interest due and payable on Component E; and (vi) sixth, to the payment of interest due and payable on Component HRR.”

6.Section 2.4.4 of the Original Loan Agreement is hereby deleted in its entirety and replaced with the following:

“2.4.4 Application of Prepayments to Components.  Except for any prepayment made prior to a rated Securitization of the Loan and any prepayment of any portion of the Free Prepayment Amount made after a rated Securitization of the Loan, any mandatory prepayment of the principal of the Loan made pursuant to Section 2.4.2 hereof and any other voluntary prepayments of principal of the Loan made pursuant to Section 2.4.1 or otherwise when no Event of Default exists shall be applied by Lender between the Components as follows:  (a) first, to the reduction of the outstanding principal balance of Component A, until reduced to zero, (b) second, to the reduction of the outstanding principal balance of Component B until reduced to zero, (c) third, to the reduction of the outstanding principal balance of Component C until reduced to zero, (iv) fourth, to the reduction of the outstanding principal balance of Component D until reduced to zero, (v) fifth, to the reduction of the outstanding principal balance of Component E until reduced to zero, and (vi) sixth, to the reduction of the outstanding principal balance of Component HRR until reduced to zero.  Any prepayment made prior to a rated Securitization of the Loan and any prepayment of any portion of the Free Prepayment Amount made after a rated Securitization of the Loan shall be applied to each Component of the Loan on

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a pro ratapari passu basis.  Notwithstanding the foregoing to the contrary, during the continuance of any Event of Default, any payment of principal from whatever source may be applied by Lender among the Components in Lender’s sole discretion.”

7.From and after the date hereof, (i) all references in the Loan Agreement to “this Agreement”, “hereunder”, “hereof” or words of like import referring to the Loan Agreement shall mean the Loan Agreement as amended by this Agreement, (ii) all references in the other Loan Documents to the “Loan Agreement” shall mean the Loan Agreement, as amended by this Agreement, (iii) all references in the Loan Documents to “this Agreement”, “hereunder”, “hereof” or words of like import referring to such Loan Document shall mean the corresponding Loan Document as amended by this Agreement, (iv) all references in the Loan Documents to the “Loan Documents” shall mean the Loan Documents as amended by this Agreement, collectively (and any reference to any particular Loan Document shall mean the corresponding Loan Document as amended by this Agreement) and (v) all terms in the Loan Documents which, by the terms thereof, have the meanings set forth in the “Loan Agreement” shall have the respective meanings set forth in the Loan Agreement as amended by this Agreement.

8.Except as otherwise expressly modified hereby, all terms, covenants and provisions of each Loan Documents are ratified and confirmed and shall remain in full force and effect as first written.

9.Any and all guaranties and indemnities for the benefit of Lender (including, without limitation, (a) that certain Guaranty Agreement, dated as of May 30, 2018, from Guarantor, to Lender, and (b) that certain Environmental Indemnity Agreement, dated as of May 30, 2018, from Borrower and Operating Lessee to Lender) shall not be released, diminished, impaired, reduced or adversely affected by this Agreement, and all obligations thereunder shall remain in full force and effect in accordance with their respective terms.

10.The execution, delivery and effectiveness of this Agreement shall not, except to the extent expressly provided herein, operate as a waiver of any right, power or remedy of Lender under the Loan Agreement or any of the other Loan Documents, nor constitute a waiver of any provision of the Loan Agreement or any of the other Loan Documents by any of the parties hereto.

11.Should any provision of this Agreement require judicial interpretation, it is agreed that a court interpreting or construing the same shall not apply a presumption that the terms hereof shall be more strictly construed against any party by reason of the rule of construction that a document is to be construed more strictly against the party who itself or through its agent prepared or drafted the same, it being agreed that all parties to this Agreement participated in the preparation hereof.

12.This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.

13.Borrower, Operating Lessee and Lender hereby ratify and confirm the Loan Agreement and all other Loan Documents, in each case, as modified hereby.  Except as modified and amended by this Agreement, the Loan, the Loan Agreement and the other Loan Documents

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and the respective obligations of Lender, Borrower and Operating Lessee thereunder shall be and remain unmodified and in full force and effect.

14.No further modification, amendment, extension, discharge, termination or waiver hereof shall be effective unless the same shall be in a writing signed by the party against whom enforcement is sought, and then such waiver or consent shall be effective only in the specific instance, and for the purpose, for which given.

15.This Agreement shall be construed and enforced in accordance with the laws of the State of New York.  If any provision hereof is not enforceable, the remaining provisions of this Agreement shall be enforced in accordance with their terms.

16.This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument.

17.This Agreement constitutes the entire agreement between Borrower, Operating Lessee and Lender with respect to subject matter hereof and supersedes all other prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof.

18.The recitals hereto are hereby incorporated into this Agreement as if fully set forth herein.  All capitalized terms used herein and not otherwise defined herein shall have the respective meanings set forth in the Loan Agreement.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first set forth above.

BORROWER:

CPLG TX PROPERTIES L.L.C.,

CPLG PROPERTIES L.L.C.,

CPLG FL PROPERTIES L.L.C.,

CPLG BLOOMINGTON L.L.C.,

CPLG SANTA ANA L.L.C.,

CPLG PRIME MEZZ L.L.C.,

CPLG PORTFOLIO EAST L.L.C.,

CPLG WELLESLEY PROPERTIES L.L.C.,

CPLG MD BUSINESS L.L.C.,

CPLG ST. ALBANS L.L.C.,

CPLG WEST PALM BEACH L.L.C.,

CPLG ACQUISITION PROPERTIES L.L.C.,

CPLG CHICAGO L.L.C.,

CPLG CHARLESTON L.L.C.,

CPLG VIRGINIA BEACH L.L.C.,

CPLG RANCHO CORDOVA L.L.C.,

CPLG FT. MYERS L.L.C.,

CPLG THOUSAND OAKS L.L.C,

CPLG CHARLOTTE L.L.C.,

CPLG FORT LAUDERDALE L.L.C.,

CPLG GARDEN CITY L.L.C.,

CPLG SOUTH BURLINGTON L.L.C.,

CPLG ISLIP L.L.C.,

each a Delaware limited liability company

By: /s/ David Bradtke

Name: David Bradtke
Title: Senior Vice President, Tax

OPERATING LESSEE:

COREPOINT TRS L.L.C.,

each a Delaware limited liability company

By: /s/ David Bradtke

Name: David Bradtke
Title: Senior Vice President, Tax

[Signature Page to First Amend. to Loan Agreement]

ACKNOWLEDGED AND AGREED:

GUARANTOR:

CorePoint Operating Partnership L.P., a Delaware limited partnership

By: CorePoint OP GP L.L.C., its general partner

By: /s/ David Bradtke

Name: David Bradtke

Title: Senior Vice President, Tax

LENDER:

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION

By: /s/ Simon B. Bruce

Name: Simon B. Bruce

Title: Vice President

PARLEX 4 FINANCE, LLC

By: /s/ Tim Johnson

Name: Tim Johnson

Title: Authorized Signatory

SCHEDULE I

BORROWER

1. CPLG TX PROPERTIES L.L.C.

2. CPLG PROPERTIES L.L.C.

3. CPLG FL PROPERTIES L.L.C.

4. CPLG FT. MYERS L.L.C.

5. CPLG THOUSAND OAKS L.L.C.

6. CPLG CHARLOTTE L.L.C.

7. CPLG FORT LAUDERDALE L.L.C.

8. CPLG GARDEN CITY L.L.C.

9. CPLG SOUTH BURLINGTON L.L.C.

10. CPLG ISLIP L.L.C.

11. CPLG ST. ALBANS L.L.C.

12. CPLG WEST PALM BEACH L.L.C.

13. CPLG ACQUISITION PROPERTIES L.L.C.

14. CPLG CHICAGO L.L.C.

15. CPLG CHARLESTON L.L.C.

16. CPLG VIRGINIA BEACH L.L.C.

17. CPLG RANCHO CORDOVA L.L.C.

18. CPLG WELLESLEY PROPERTIES L.L.C.

19. CPLG MD BUSINESS L.L.C.

20. CPLG BLOOMINGTON L.L.C.

21. CPLG SANTA ANA L.L.C.

22. CPLG PRIME MEZZ L.L.C.

23. CPLG PORTFOLIO EAST L.L.C.

EX-10.12

Exhibit 10.12

Final Version

COREPOINT LODGING INC.
EXECUTIVE SEVERANCE PLAN

Plan Document/Summary Plan Description

CorePoint Lodging Inc. (the “Company”) has adopted the CorePoint Lodging Inc. Executive Severance Plan (the “Plan”) for the benefit of certain employees of the Company and its subsidiaries (hereinafter referred to as the “Company Group”), on the terms and conditions hereinafter stated, effective as of the Effective Date.  

The Plan is not intended to be an “employee pension benefit plan” or “pension plan” within the meaning of Section 3(2) of ERISA.  Rather, the Plan is intended to be a “welfare benefit plan” within the meaning of Section 3(1) of ERISA and to meet the descriptive requirements of a plan constituting a “severance pay plan” within the meaning of regulations published by the Secretary of Labor at Title 29, Code of Federal Regulations, Section 2510.3-2(b).  Accordingly, any benefits paid pursuant to the terms of the Plan are not deferred compensation for purposes of ERISA, and no Participant shall have a vested right to such benefits.  To the extent applicable, it is intended that portions of the Plan either comply with or be exempt from the provisions of Section 409A of the Code.  The Plan shall be administered in a manner consistent with this intent and any provision that would cause the Plan to fail to either constitute a welfare benefit plan under ERISA or comply with or be exempt from Section 409A of the Code, as the case may be, shall have no force and effect.  This document serves as both the plan document as required under Section 402 of ERISA as well as a summary plan description as required under Section 104(b) of ERISA.

1.Definitions.

(a)“Accrued Obligations” means (i) all accrued but unpaid Base Salary through the date of a Covered Termination, (ii) any unpaid or unreimbursed expenses incurred in accordance with the policies of the Employer, and (iii) any benefits provided under the employee benefit plans and programs of the Company Group in which the Participant participates immediately prior to, and is due upon or continues after, a termination of employment (including, where applicable, death or Disability), including rights with respect to Company equity (or equity derivatives).

(b)“Affiliate” has the meaning set forth in the Omnibus Plan.

(c)“Annual Bonus Program” means the annual cash incentive bonus program in which the Participant participates as of the date of such Participant’s Covered Termination.

(d)“Asset Sale” means a Change in Control resulting from the sale, transfer, or other disposition of all or substantially all of the assets of the Company to any Person that is not an Affiliate of the Company.

(e)“Award” has the meaning set forth in the Omnibus Plan.

(f)“Base Salary” means the Participant’s then current annual base salary rate immediately prior to his or her Covered Termination (or, if higher, the annual base salary immediately prior to an event that constitutes Good Reason hereunder), and determined without

regard to any salary deferrals under any deferred compensation or cafeteria plans or programs of the Company Group in which the Participant participates.

(g)“Board” means the Board of Directors of the Company.

(h)“Cause” has the meaning set forth in the Omnibus Plan.

(i)“Change in Control” has the meaning set forth in the Omnibus Plan.

(j)“Claims Administrator” means the Committee or such other individual or group of individuals as may be appointed as the claims administrator under the Plan by the Committee from time to time.

(k)“Clawback Policy” means the Company’s Incentive Compensation Clawback Policy (or any successor policy thereto adopted by the Company).

(l)“Code” means the Internal Revenue Code of 1986, as amended, and the rules, regulations or other interpretative guidance promulgated thereunder, as well as any successor laws in replacement thereof.

(m)“Committee” means the Compensation Committee of the Board.

(n)“Covered Termination” means a Participant’s termination of employment with the Employer by the Employer without Cause or by the Participant for Good Reason; provided, however, that no such termination shall be considered a Covered Termination if:

(i)such Participant’s employment with the Employer is terminated by reason of a transfer to the employ of another member of the Company Group,

(ii)such Participant’s employment with the Employer is terminated upon the expiration of a leave of absence by reason of his or her failure to return to work at such time unless, at such time, there is not an available position for which such Participant is qualified, or

(iii)such Participant’s employment with the Employer is terminated in connection with an Asset Sale or Significant Corporate Event if either (A) in connection with such Asset Sale or Significant Corporate Event such Participant was offered employment within a 50-mile radius of such Participant’s current work site for a comparable position with (x) the purchaser or an Affiliate thereof in an Asset Sale or (y) to the extent the Employer is no longer part of the Company Group as a result of a Significant Corporate Event, such Employer, with the same or greater Base Salary, and with comparable annual bonus and equity compensation opportunity, and the Participant fails to accept such employment offer, or (B) notwithstanding the comparable terms and conditions of employment being available, such Participant voluntarily elected not to participate in the selection process for employment with (x) the purchaser or an Affiliate thereof in an Asset Sale or (y) to the extent the Employer is no longer part of the Company Group as a result of a Significant Corporate Event, such Employer.

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(o)“Disability” has the meaning set forth in the Omnibus Plan.

(p)“Effective Date” means the date on which the spin-off of the Company from La Quinta Holdings Inc. is effective.  

(q)“Eligible Employee” means each non-union, salaried, full-time employee of the Company Group with the title of Vice President or above.  Eligible Employees shall, in no event, include: (i) independent contractors, (ii) temporary employees, (iii) individuals treated other than as employees for federal income and employment tax purposes at the time such individual performs services, (iv) employees who are regularly scheduled to work less than 20 hours per week, and (v) individuals who the Company designates as “non-benefits eligible.”  

(r)“Employer” means, with respect to any Participant, (i) the member of the Company Group by which such Participant is employed, or (ii) to the extent such Participant was employed by an entity that is no longer part of the Company Group as a result of a Significant Corporate Event, such entity (or Affiliate thereof), as applicable, that employs such Participant immediately following such Significant Corporate Event.

(s)“ERISA” means the Employee Retirement Income Security Act of 1974, as amended, and the rules, regulations or other interpretive guidance promulgated thereunder, as well as any successor laws in replacement thereof.

(t)“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules, regulations or other interpretive guidance promulgated thereunder, as well as any successor laws in replacement thereof.

(u)“Good Reason” means, without the Participant’s consent, (i) a material diminution in the Participant’s authorities, duties, job responsibilities, status or reporting relationships, (ii) (A) a reduction in base salary or target bonus opportunity, (B) the failure to pay the base salary or the applicable bonus amount when due, or (C) for the two-year period following a Qualifying Event, a reduction in equity compensation opportunity (based on the grant date fair value of such equity compensation, as determined under FASB Accounting Standards Codification Topic 718), (iii) the relocation of the principal place of the Participant’s employment by more than 50 miles from the Participant’s principal place of employment, (iv) the material breach of an existing agreement between the Company and the Participant, or (v) the failure of (A) any purchaser (or an Affiliate thereof) in an Asset Sale, or (B) to the extent the Employer is no longer part of the Company Group as a result of a Significant Corporate Event, such Employer, in either case, by agreement in writing, to expressly, absolutely and unconditionally assume and agree to perform the Plan, in the same manner and to the same extent that the Company would be required to perform the Plan if no such Asset Sale or Significant Corporate Event, as applicable, had taken place; provided, thatany of the events described in clauses (i) – (iv) above shall constitute Good Reason only if the Company (or applicable employer following a Qualifying Event) fails to cure such event within 30 days after receipt from the Participant of written notice of the event which constitutes Good Reason; and provided further, that the Participant shall cease to have a right to terminate due to any Good Reason event on the 90^th day following the later of the occurrence of the event or the

3

Participant’s knowledge thereof, unless the Participant has given the Company (or applicable employer following a Qualifying Event) written notice thereof prior to such date.

(v)“Non-Interference Agreement” shall mean the Confidentiality, Non-Interference, and Invention Assignment Agreement attached hereto as Exhibit A.

(w)“Omnibus Plan” means the Company’s 2018 Omnibus Incentive Plan, as amended from time to time (or any successor plan thereto adopted by the Company for the purpose of providing equity and other incentive compensation to the employees and other service providers of the Company or its Affiliates).

(x)“Other Severance Arrangements” means any plans, policies, guidelines, arrangements, agreements, letters and/or other communication, whether formal or informal, written or oral sponsored by the Company or any of its Affiliates (or following any Significant Corporate Event, the Employer or its Affiliates) and/or entered into by any representative of the Company or any of its Affiliates (or following any Significant Corporate Event, the Employer or its Affiliates) that might otherwise provide severance benefits upon a Covered Termination.

(y)“Outplacement Benefit” means the payment of, or reimbursement for, professional outplacement services up to a maximum of $10,000 within the three-year period following a Covered Termination or Qualifying Event Covered Termination, as applicable.

(z)“Participant” means an Eligible Employee who is designated as a Participant by the Committee, subject to the requirements of Section 2.  For purposes hereof, the Committee shall be permitted to designate groups of Eligible Employees by job title as Participants without the need to identify any individual Participant by name.

(aa)“Person” means any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act).

(bb)“Pro-Rata Bonus” means an amount equal to (i) in the case of a Qualifying Event Covered Termination, the Participant’s Target Bonus, and (ii) in the case of a Covered Termination that is not a Qualifying Event Covered Termination, the Participant’s bonus earned based on actual performance, in each case, with respect to the bonus otherwise payable under the Annual Bonus Program for the year in which the Participant’s Covered Termination occurred, pro-rated for the months of service up to and including the month of termination.

(cc)“Qualifying Event” means the first to occur of (i) a Change in Control, or (ii) with respect to any Participant whose Employer is no longer part of the Company Group as a result of a Significant Corporate Event, such Significant Corporate Event.  For the avoidance of doubt, the consummation of the spin-off of CorePoint Lodging, Inc. from La Quinta Holdings Inc. shall constitute a Qualifying Event.

(dd)“Qualifying Event Covered Termination” means a Covered Termination occurring (i) on or within the six-month period prior to a Qualifying Event or (ii) within the two-year period following a Qualifying Event.

(ee)“Release Agreement” means a release of claims in the form customarily provided

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by the Company Group to terminated employees, pursuant to which a Participant may be required to (i) acknowledge the receipt of the severance payment and other benefits, and (ii) release the Company and its Affiliates (including the Employer and its Affiliates) and other Persons designated by the Company from any liability arising from his or her employment or termination thereof (other than with respect to the Participant’s rights under the Plan).

(ff)“Retirement” means a voluntary resignation by the Participant at or after the age of 60 following continuous employment by the Employer for a period of at least ten years, with (i) at least 120 days’ notice by the Participant to the Employer of such voluntary resignation, and (ii) approval from the Committee to receive any payment or benefits set forth in the Plan.

(gg)“Significant Corporate Event” means a reorganization, recapitalization, extraordinary stock dividend, merger, sale, spin-off or other similar transaction or series of transactions, which individually or in the aggregate, has the effect of resulting in the elimination from the Company Group of all, or the majority of, either the Company’s operating units or the Company’s real property assets, in either case, so long as such transaction or transactions do not otherwise constitute a Change in Control.

(hh)“Target Bonus” means the Participant’s target annual bonus under the Annual Bonus Program.

(ii)“Welfare Continuation” means continued health insurance coverage at substantially the same level as provided to a Participant immediately prior to a Covered Termination (or death or Disability, as applicable), for which the Company will provide such coverage, to the extent permissible under the applicable Company Group plan, for the Welfare Continuation Period at the same cost to the Participant as is generally provided to similarly-situated active employees of the Employer, which, to the extent required to comply with Section 105 of the Code, shall be provided as a taxable benefit; provided, however, that the Company may, in its sole discretion, require such Participant to elect to participate in COBRA for such Welfare Continuation coverage.

(jj)“Welfare Continuation Period” means the period during which Welfare Continuation is provided to any Participant.

2.Eligibility.  

Except as otherwise provided under the Plan, each Participant is eligible to receive severance pay and severance benefits under the Plan if such Participant:

(a)remains in the employ of the Employer through the date of a Covered Termination, death, Disability or Retirement,

(b)fulfills the normal responsibilities of such Participant’s position, including, but not limited to, meeting regular attendance, specific transitional activities, workload and other standards of the Employer, and

(c)executes and submits a Non-Interference Agreement in connection with, and no later than 30 days following, becoming a Participant under the Plan.

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3.Termination of Employment.

(a)Payments on Covered Termination.  If a Participant undergoes a Covered Termination, in addition to any Accrued Obligations, subject to such Participant’s execution, delivery to the Company, and non-revocation of a Release Agreement, as contemplated in subsection (f) below, and continued compliance with the Non-Interference Agreement, such Participant shall be entitled to the following payments and benefits:

(i)the Pro-Rata Bonus, which will be payable to the Participant concurrently with the cash bonus payments to other similarly-situated employees under the Annual Bonus Program (but in all events prior to March 15 of the calendar year immediately following the calendar year in which such Covered Termination occurs),

(ii)(A) a lump-sum cash payment equal to the “Cash Severance Amount”, as set forth in Appendix A, attached hereto, payable within 60 days following the date of the Participant’s Covered Termination, and (B) Welfare Continuation during the Welfare Continuation Period set forth in Appendix A, and

(iii)the Outplacement Benefit.

(b)Payments on Qualifying Event Covered Termination.  If a Participant undergoes a Qualifying Event Covered Termination, in addition to any Accrued Obligations, subject to such Participant’s execution, delivery to the Company, and non-revocation of a Release Agreement, as contemplated in subsection (f) below, and continued compliance with the Non-Interference Agreement, such Participant shall be entitled to the following payments and benefits in lieu of the payments and benefits set forth in Section 3(a):

(i)the Pro-Rata Bonus, which will be payable to the Participant concurrently with the cash bonus payments to other similarly-situated employees under the Annual Bonus Program (but in all events prior to March 15 of the calendar year immediately following the calendar year in which such Qualifying Event Covered Termination occurs),

(ii)(A) a lump-sum cash payment equal to the “Cash Severance Amount”, as set forth in Appendix B, attached hereto, payable within 60 days following the date of the Participant’s Qualifying Event Covered Termination, and (B) Welfare Continuation during the Welfare Continuation Period set forth in Appendix B, and

(iii)the Outplacement Benefit.

Payments and benefits described under subsections (a) and (b) may be made by the Company or any other member of the Company Group, as determined by the Company in its sole discretion, including, without limitation, the Employer.

(c)Payments on Death or Disability. In the event a Participant’s employment with the Employer is terminated due to such Participant’s death or Disability, in addition to any Accrued Obligations, and in the case of such Participant’s Disability, subject to such Participant’s execution, delivery to the Company, and non-revocation of a Release Agreement, as contemplated in subsection (f) below, and continued compliance with the Non-Interference Agreement, such

6

Participant (or such Participant’s estate, as applicable) shall be entitled to (i) such Participant’s Target Bonus for the year of such Participant’s termination of employment due to such Participant’s death or Disability (which will be payable to the Participant concurrently with the cash bonus payments to other similarly-situated employees under the Annual Bonus Program (but in all events prior to March 15 of the calendar year immediately following the calendar year in which such termination occurs)), and (ii) in the case of such Participant’s Disability, Welfare Continuation (for such Participant or such Participant’s spouse and eligible dependents, as applicable) for a Welfare Continuation Period equal to 12 months.

(d)Payments on Retirement. In the event a Participant’s employment with the Employer is terminated due to Retirement, in addition to any Accrued Obligations, subject to such Participant’s execution, delivery to the Company, and non-revocation of a Release Agreement, as contemplated in subsection (f) below, and continued compliance with the Non-Interference Agreement, such Participant shall be entitled to an amount equal to the bonus amount otherwise payable under the Annual Bonus Program for the year in which the Participant’s Retirement occurred, pro-rated for the months of service up to and including the month of termination and based on actual performance for the year, which will be payable to the Participant concurrently with the cash bonus payments to other employees under the Annual Bonus Program (but in all events prior to March 15 of the calendar year immediately following the calendar year in which such termination occurs).

(e)Other Termination Events.  If a Participant’s employment is terminated for any reason other than pursuant to a Covered Termination, a Qualifying Event Covered Termination, death, Disability or Retirement, such Participant shall not be entitled to the payment of any severance or other benefits under the Plan.

(f)Release Agreement.  Notwithstanding any provision herein to the contrary, the payment of any amount or provision of any benefit pursuant to this Section 3 (other than the Accrued Obligations) shall be conditioned upon a Participant’s execution, delivery to the Company, and non-revocation of the Release Agreement (and the expiration of any revocation period contained in such Release Agreement) within 60 days following the date of a Covered Termination, Disability or Retirement.  If a Participant fails to execute the Release Agreement in such a timely manner so as to permit any revocation period to expire prior to the end of such 60-day period, or timely revokes his or her acceptance of such release following its execution, such Participant shall not be entitled to payment of any severance and other benefits under the Plan.  Further, to the extent that any of the payments hereunder constitute “nonqualified deferred compensation” for purposes of Section 409A of the Code, any payment of any amount or provision of any benefit otherwise scheduled to occur prior to the 60^th day following the date of such Covered Termination, Disability or Retirement, but for the condition of executing the Release Agreement as set forth herein, shall not be made until the first regularly scheduled payroll date following such 60^th day, after which any remaining payments shall thereafter be provided to the Participant according to the applicable schedule set forth herein.  

(g)Clawback/Forfeiture.  Notwithstanding any provision herein to the contrary, the payment of any amount or provision of any benefit pursuant to subsections (a), (b), (c) or (d) above (other than the Accrued Obligations) shall be conditioned upon and subject to the Clawback Policy.

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4.Treatment of Awards.  

Any outstanding Awards granted to the Participant under the Omnibus Plan shall vest in accordance with the terms of the Omnibus Plan and applicable award agreement; provided, that any unvested and outstanding Award that is not continued, converted, assumed, or replaced in connection with a Qualifying Event shall fully vest in connection with such Qualifying Event; provided further, that (a) in the case of performance-based vesting Awards with market performance conditions, such as absolute or relative TSR, such vesting shall be based on actual performance through the date of such Qualifying Event, and (b) in the case of performance-based vesting Awards with financial performance conditions, such as EBITDA, such vesting shall be based on target performance.

5.Additional Terms.

(a)Taxes.  Severance and other payments and benefits under the Plan will be subject to all required federal, state and local taxes and may be affected by any legally required withholdings.  Payments under the Plan are not deemed “compensation” for purposes of the retirement plans, savings plans, and incentive plans of the Company Group.  Accordingly, no deductions will be taken for any retirement and savings plan and such plans will not accrue any benefits attributable to payments under the Plan.

(b)Set Off; Mitigation.  The Company’s obligation to pay the Participant the amounts provided and to make the arrangements provided hereunder shall not be subject to set-off, counterclaim, or recoupment of amounts owed by the Participant to the Company or its Affiliates.  The Participant shall not be required to mitigate the amount of any payment provided pursuant to the Plan by seeking other employment or otherwise, and the amount of any payment provided for pursuant to the Plan shall not be reduced by any compensation earned as a result of the Participant’s other employment or otherwise.

(c)Specified Employees.  Notwithstanding anything herein to the contrary, if (i) at the time of a Participant’s Covered Termination, such Participant is a “specified employee” as defined in Section 409A of the Code, and the deferral of the commencement of any payments or benefits otherwise payable hereunder as a result of such termination of employment is necessary in order to prevent the imposition of any accelerated or additional tax under Section 409A of the Code, then the commencement of the payment of any such payments or benefits hereunder will be deferred (without any increase or decrease in such payments or benefits ultimately paid or provided to the Participant) until the date that is six months following such Participant’s Covered Termination (or the earliest date that is permitted under Section 409A of the Code), and (ii) any other payments of money or other benefits due to the Participant hereunder would cause the application of an accelerated or additional tax under Section 409A of the Code, such payments or other benefits shall be deferred if deferral will make such payment or other benefits compliant under Section 409A of the Code, or otherwise such payment or other benefits shall be restructured, to the extent possible, in a manner, determined by or at the direction of the Committee, that does not cause such an accelerated or additional tax or result in additional cost to the Company.  The Company shall consult with its legal counsel and tax advisors in good faith regarding the implementation of this Section 5(c); provided, however, that none of the Company any other member of the Company Group, or any of their respective employees or representatives, shall have

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any liability to the Participant with respect thereto.

6.Termination or Amendment of the Plan.

The Plan may be amended, terminated or discontinued in whole or in part, at any time and from time to time at the discretion of the Board or the Committee with at least one year’s written notice to the Participants; provided, however, that no such amendment, termination or discontinuance shall, without a Participant’s consent, adversely affect any Participant that has undergone a Covered Termination prior to the effective date of any such amendment, termination or discontinuance; provided further, that following a Qualifying Event, the Plan may not be amended, terminated or discontinued in whole or in part, at any time prior to the fifth anniversary of the date of such Qualifying Event without the written consent of an affected Participant.

7.Limitation of Certain Payments.

In the event that any payments and/or benefits due to a Participant under the Plan and/or any other arrangements are determined by the Company to constitute “excess parachute payments” as defined under Section 280G of the Code, any cash severance payable under the Plan shall be reduced by the minimum amount necessary, subject to the last sentence of this paragraph, such that the present value of such parachute payments is below 300% of such Participant’s “base amount” (as defined under Section 280G of the Code), and by accepting participation in the Plan, each Participant agrees to waive his or her rights to any “parachute payments” (as defined under Section 280G of the Code) sufficient to reduce such parachute payments to below such threshold; provided, however, in no event shall such cash severance be reduced below zero.  Notwithstanding the foregoing, no payments or benefits shall be reduced under this Section 7 unless (a) the net amount of such payments and benefits, as so reduced (and after subtracting the net amount of federal, state and local income taxes on such reduced payments and after taking into account the phase out of itemized deductions and personal exemptions attributable to such reduced payments and benefits), is greater than or equal to (b) the net amount of such payments without such reduction (but after subtracting the net amount of federal, state and local income taxes on such payments and benefits and the amount of excise tax imposed under Section 4999 of the Code as to which such Participant would be subject in respect of such unreduced payments and benefits and after taking into account the phase out of itemized deductions and personal exemptions attributable to such unreduced payments).  Notwithstanding the foregoing, to the extent a Participant is entitled to any reimbursement or gross-up payment with respect to any tax imposed under Section 4999 of the Code, such reimbursement or gross-up payment shall be taken into account before any payments and/or benefits due to such Participant under the Plan and/or any other arrangements are reduced.  For purposes hereof, (i) the order in which any amounts are deemed to be reduced, if applicable, is (A) cash payments, (B) other non-cash forms of benefits, and (C) equity-based payments and acceleration of vesting, and (ii) within any such category of payments and benefits (that is, (i)(A), (i)(B) or (i)(C) above), (A) a reduction shall occur first with respect to amounts that are not “deferred compensation” within the meaning of Section 409A of the Code and then with respect to amounts that are and (B) to the extent that any such amounts are to be made over time (e.g., in installments, etc.), then the amounts shall be reduced in reverse chronological order.  

8.Claims Procedure.

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(a)Processing Claims.  If an individual is not selected for participation in the Plan or does not satisfy the conditions for eligibility in the Plan, he or she is not entitled to benefits and/or payments under the Plan.  A claim for benefits under the Plan must be filed within 180 days following the date that such Participant’s claim for benefits is denied.  If an individual fails to act within the 180-day limit, the individual loses the right to have his or her claim reviewed.  

(b)Decision.  The processing of claims for benefits and payments under the Plan will be carried out as quickly as possible.  If an individual’s claim for benefits under the Plan is denied, the individual will receive a written notice of such denial within 90 days of receipt of such individual’s claim.  In special cases, an additional 90 days may be needed and such individual will be notified in this case within such initial 90-day period.  The extension notice will indicate the special circumstances requiring an extension of time and the date by which the Claims Administrator expects to render the benefit determination.  Any written notice denying an individual’s claim for benefits under the Plan will include:

(i)specific reasons as to why the claim was denied,

(ii)clear reference to the Plan provisions upon which the denial is based,

(iii)a description of any additional material or information to further support the claim, and the reasons why these are necessary, and

(iv)a description of the Plan’s review procedures and the time limits applicable to such procedures, including a statement of the individual’s right to bring a civil action under Section 502 of ERISA following an adverse benefit determination on review.

(c)Request for Review of Denial of Benefits.  The individual or his or her authorized representative may request a review of his or her claim by giving written notice to the Claims Administrator.  Each individual has the right to have representation, review pertinent documents, and present written issues and comments.  An individual shall be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to such individual’s claims for benefits.  An individual’s request must be made not later than 60 days after he or she receives the notice of denial.  If an individual fails to act within the 60-day limit, the individual loses the right to have his or her claim reviewed.

(d)Decision on Review.  Upon receipt of a request for review from an individual, the Claims Administrator shall make a full and fair evaluation of the denied claim and may require additional documents necessary for such a review.  The Claims Administrator shall make a decision within 60 days from receipt of the individual’s request.  Such decision will take into account all comments, documents, records, and other information submitted by such individual relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.  In special cases, an additional 60 days may be needed and such individual will be notified in this case within such initial 60-day period.  The extension notice will indicate the special circumstances requiring an extension of time and the date by which the Claims Administrator expects to render the benefit determination.  In no event shall the decision be made more than 120 days after receipt of the individual’s request for review.  The decision on the review shall be in writing and shall include specific reasons for the decision.  The final decision of the

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Claims Administrator shall be conclusive and binding upon all parties having or claiming to have an interest in the matter being reviewed.  Any written notice denying an individual’s appeal for benefits under the Plan will include:

(i)specific reasons as to why the appeal was denied,

(ii)clear reference to the Plan provisions upon which the denial is based,

(iii)a statement that the individual is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to the individual’s appeal for benefits, and

(iv)a statement describing any voluntary appeals procedures offered by the Plan and the individual’s right to obtain the information about such procedures, and a statement of the individual’s right to bring a civil action under Section 502 of ERISA.

(e)In Case of Clerical Error.  If any information regarding an individual is incorrect, and the error affects his or her benefits, the correct information will determine the extent, if any, of the individual’s benefits under the Plan.

9.Miscellaneous.

(a)No Right to Continued Employment.  Nothing contained in the Plan shall confer upon any Participant any right to continue in the employ of any member of the Company Group nor interfere in any way with the right of the Company to terminate his or her employment, with or without Cause.

(b)Plan Not Funded.  Amounts payable under the Plan shall be payable from the general assets of the Company, and no special or separate reserve, fund or deposit shall be made to assure payment of such amounts.  No Participant, beneficiary or other Person shall have any right, title or interest in any fund or in any specific asset of the Company by reason of participation hereunder.  Neither the provisions of the Plan, nor the creation or adoption of the Plan, nor any action taken pursuant to the provisions of the Plan shall create, or be construed to create, a trust of any kind or a fiduciary relationship between the Company and any Participant, beneficiary or other Person.  To the extent that a Participant, beneficiary or other Person acquires a right to receive payment under the Plan, such right shall be no greater than the right of any unsecured general creditor of the Company.  Notwithstanding the foregoing, the Company shall have the right to implement or set aside funds in a grantor trust, subject to the claims of the Company’s creditors or otherwise, to discharge its obligations under the Plan.

(c)Non-Transferability of Benefits and Interests.  All amounts payable under the Plan are non-transferable, and no amount payable under the Plan shall be subject in any manner to sale, transfer, anticipation, alienation, assignment, pledge, encumbrance or charge.  This Section 9(c) shall not apply to an assignment of a contingency or payment due (i) after the death of a Participant to the deceased Participant’s legal representative or beneficiary, or (ii) after the disability of a Participant to the disabled Participant’s personal representative.

(d)Discretion of Company, Board and Committee.   Any decision made or action taken

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by, or inaction of, the Company, the Board, the Committee or the Claims Administrator arising out of or in connection with the creation, amendment, construction, administration, interpretation and effect of the Plan that is within its authority hereunder or applicable law shall be within the absolute discretion of such entity and shall be conclusive and binding upon all Persons.  In the case of any conflict, the decision made or action taken by, or inaction of, the Claims Administrator will control.  However, with respect to the authorized officers and senior executives, as designated by the Board in its resolutions, any decision made or action taken by, or inaction of, the Committee controls.

(e)Indemnification.  Neither the Board nor the Committee, any employee of the Company, nor any Person acting at the direction thereof (each such Person an “Affected Person”), shall have any liability to any Person (including without limitation, any Participant), for any act, omission, interpretation, construction or determination made in connection with the Plan (or any payment made under the Plan).  Each Affected Person shall be indemnified and held harmless by the Company against and from any loss, cost, liability or expense (including attorneys’ fees) that may be imposed upon or incurred by such Affected Person in connection with or resulting from any action, suit or proceeding to which such Affected Person may be a party or in which such Affected Person may be involved by reason of any action taken or omitted to be taken under the Plan and against and from any and all amounts paid by such Affected Person, with the Company’s approval, in settlement thereof, or paid by such Affected Person in satisfaction of any judgment in any such action, suit or proceeding against such Affected Person; provided, that the Company shall have the right, at its own expense, to assume and defend any such action, suit or proceeding and, once the Company gives notice of its intent to assume the defense, the Company shall have sole control over such defense with counsel of the Company’s choice. The foregoing right of indemnification shall not be available to an Affected Person to the extent that a court of competent jurisdiction in a final judgment or other final adjudication, in either case, not subject to further appeal, determines that the acts or omissions of such Affected Person giving rise to the indemnification claim resulted from such Affected Person’s bad faith, fraud or willful wrongful act or omission.  The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which Affected Persons may be entitled under the Company’s organizational documents, as a matter of law, or otherwise, or any other power that the Company may have to indemnify such Person or hold them harmless.

(f)Section 409A.  Notwithstanding any provision of the Plan to the contrary, if any benefit provided under the Plan is subject to the provisions of Section 409A of the Code, the provisions of the Plan will be administered, interpreted and construed in a manner necessary to comply with Section 409A of the Code or an exception thereto.  Notwithstanding any provision of the Plan to the contrary, in no event shall the Company (or its employees, officers or directors) have any liability to any Participant (or any other Person) due to the failure of the Plan to satisfy the requirements of Section 409A of the Code or any other applicable law.

(g)No Duplication; Treatment of Other Severance Arrangements.  In no event shall any Participant receive the severance benefits provided for herein in addition to severance benefits provided for under any Other Severance Arrangement; provided, that if such Participant is covered by any Other Severance Arrangement, such Participant shall be entitled to any amount due and payable under the Plan that is greater than and in addition to the amount due and payable under the Other Severance Arrangment.

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(h)Governing Law.  All questions pertaining to the construction, regulation, validity and effect of the provisions of the Plan shall be determined in accordance with the laws of Maryland.

(i)Notice.  Any notice or other communication required or which may be given pursuant to the Plan shall be in writing and shall be deemed to have been duly given when delivered by hand or overnight courier or two days after it has been mailed by United States express or registered mail, return receipt requested, postage prepaid, addressed to the Company at the address set forth below, or to the Participant at his or her most recent address on file with the Company.

CorePoint Lodging Inc.

909 Hidden Ridge, Suite 600

Irving, Texas 75038

c/o General Counsel

(j)Captions.  Captions and headings are given to the sections and subsections of the Plan solely as a convenience to facilitate reference.  Such captions and headings shall not be deemed in any way material or relevant to the construction or interpretation of the Plan or any provision thereof.

(k)Successors. The Plan shall inure to the benefit of and be binding upon the Company and its successors.  

10.ERISA Rights.  

(a)Eligible Employees are entitled to certain rights and protections under ERISA.  ERISA provides that Eligible Employees under the Plan shall be entitled to:

(i)examine, without charge, at the office of the Plan Administrator (as defined in Section 11) and at other specified locations, all documents governing the Plan and a copy of the latest annual report (Form 5500 Series) filed by the Plan with the U.S. Department of Labor and available at the Public Disclosure Room of the Employee Benefits Security Administration,

(ii)obtain, upon written request to the Plan Administrator, copies of documents governing the operation of the Plan and copies of the latest annual report (Form 5500 Series) and updated summary plan description.  The Plan Administrator may make a reasonable charge for the copies, and

(iii)receive a summary of the Plan’s annual financial report.  The Plan Administrator is required by law to furnish each Participant with a copy of the summary annual report.

(b)In addition to creating rights for plan participants, ERISA imposes duties upon the people who are responsible for the operation of the Plan.  The people who operate the Plan, called “fiduciaries” of the Plan, have a duty to do so prudently and in the interest of Eligible Employees.  No one, including the Employer or any other Person, may fire an Eligible Employee or otherwise

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discriminate against an Eligible Employee in any way to prevent such Eligible Employee from obtaining a benefit or exercising such Eligible Employee’s rights under ERISA.

(c)If an Eligible Employee’s claim is denied or ignored, in whole or in part, Eligible Employees have a right to know why this was done and to obtain copies of documents relating to the decision without charge, and to appeal any denial, all within certain time schedules, as set forth in Section 8.  Under ERISA, there are steps Eligible Employees can take to enforce the above rights.  For instance, if an Eligible Employee requests a copy of plan documents or the latest annual report from the Plan Administrator and does not receive them within 30 days, such Eligible Employee may file suit in Federal court.  In such a case, the court may require the Plan Administrator to provide the materials and pay such Eligible Employee up to $110 a day until such Eligible Employee receives the materials, unless the materials were not sent because of reasons beyond the control of the Plan Administrator.  If the Eligible Employee has a claim for benefits which is denied or ignored, in whole or in part, such Eligible Employee may file suit in a state or Federal court.  If it should happen that Plan fiduciaries misuse the Plan’s money, or if an Eligible Employee is discriminated against for asserting such Eligible Employee’s rights, such Eligible Employee may seek assistance from the U.S. Department of Labor, or such Eligible Employee may file suit in a Federal court.  The court will decide who should pay court costs and legal fees.  If the Eligible Employee is successful, the court may order the person such Eligible Employee sued to pay these costs and fees.  If the Eligible Employee loses, the court may order such Eligible Employee to pay these costs and fees, for example, if it finds such Eligible Employee’s claim is frivolous.

(d)If the Eligible Employee has questions about the Plan, such Eligible Employee should contact the Plan Administrator.  If the Eligible Employee has questions about this Section 10 or about such Eligible Employee’s rights under ERISA, such Eligible Employee should contact the nearest office of the Employee Benefits Security Administration, U.S. Department of Labor, listed in your telephone directory or the Division of Technical Assistance and Inquiries, Employee Benefits Security Administration, U.S. Department of Labor, 200 Constitution Avenue N.W., Washington, D.C. 20210.  Eligible Employees may also obtain certain publications about such Eligible Employee’s rights and responsibilities under ERISA by calling the publications hotline of the Employee Benefits Security Administration.

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11.General Information.

Name of Plan	CorePoint Lodging Inc. Executive Severance Plan
Plan Number	505
Plan Sponsor	CorePoint Lodging Inc. 909 Hidden Ridge, Suite 600, Irving, Texas 75038 Tel: (214) 492-6600
Plan Sponsor’s Employer Identification Number	82-1497742
Plan Administrator	General Counsel of the Company
Agent for Service of Legal Process	Plan Administrator or Corporation Services Company 2711 Centerville Road, Suite 400 Wilmington, DE 19808
Plan Year	Calendar Year

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Appendix A

Payments on Covered Termination

Eligible Employee	Welfare Continuation Period	Cash Severance Amount
Vice President (VP)	6 months	0.5 times the sum of the Participant’s (i) Base Salary and (ii) Target Bonus
Senior Vice President (SVP)	9 months	0.75 times the sum of the Participant’s (i) Base Salary and (ii) Target Bonus
Executive Vice President (EVP)	18 months	1.5 times the sum of the Participant’s (i) Base Salary and (ii) Target Bonus
President and Chief Executive Officer (CEO)	24 months	2.0 times the sum of the Participant’s (i) Base Salary and (ii) Target Bonus

Appendix B

Payments on Qualifying Event Covered Termination

Eligible Employee	Welfare Continuation Period	Cash Severance Amount
Vice President (VP)	12 months	1.0 times the sum of the Participant’s (i) Base Salary and (ii) Target Bonus
Senior Vice President (SVP)	18 months	1.5 times the sum of the Participant’s (i) Base Salary and (ii) Target Bonus
Executive Vice President (EVP)	24 months	2.0 times the sum of the Participant’s (i) Base Salary and (ii) Target Bonus
President and Chief Executive Officer (CEO)	36 months	3.0 times the sum of the Participant’s (i) Base Salary and (ii) Target Bonus

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Exhibit A

CONFIDENTIALITY, NON-INTERFERENCE, AND INVENTION ASSIGNMENT AGREEMENT

As a condition of my participation in the CorePoint Lodging Inc. Executive Severance Plan (the “Plan”), and in consideration of my continued employment with CorePoint Lodging Inc. (the “Company”) and my receipt of the compensation now and hereafter paid to me under the Plan and/or by the Company, I agree to the terms and conditions of this Confidentiality, Non-Interference, and Invention Assignment Agreement (the “Non-Interference Agreement”):

1.Confidential Information.

(a)Company Group Information.  I acknowledge that, during the course of my employment, I will have access to information about the Company and its direct and indirect subsidiaries (together with the Company, the “Company Group”) and that my employment with the Company shall bring me into close contact with confidential and proprietary information of the Company Group.  In recognition of the foregoing, I agree, at all times during the term of my employment with the Company and for the twenty-four (24)-month period thereafter, to hold in confidence, and not to use, except for the benefit of the Company Group, or to disclose to any person, firm, corporation, or other entity without written authorization of the Company, any Confidential Information that I obtain or create.  I further agree not to make copies of such Confidential Information except as authorized by the Company.  I understand that “Confidential Information” means information that the Company Group has or will develop, acquire, create, compile, discover, or own, that has value in or to the business of the Company Group that is not generally known and that the Company wishes to maintain as confidential.  I understand that Confidential Information includes, but is not limited to, any and all non-public information that relates to the actual or anticipated business and/or products, research, or development of the Company, or to the Company’s technical data, trade secrets, or know-how, including, but not limited to, research, product plans, or other information regarding the Company’s products or services and markets, customer lists, and customers (including, but not limited to, customers of the Company on whom I called or with whom I may become acquainted during the term of my employment), software, developments, inventions, processes, formulas, technology, designs, drawings, engineering, hardware configuration information, marketing, finances, and other business information disclosed by the Company either directly or indirectly in writing, orally, or by drawings or inspection of premises, parts, equipment, or other Company property.  Notwithstanding the foregoing, Confidential Information shall not include (i) any of the foregoing items that have become publicly and widely known through no unauthorized disclosure by me or others who were under confidentiality obligations as to the item or items involved or (ii) any information that I am required to disclose to, or by, any U.S. federal, state or local governmental or law enforcement branch, agency or entity (collectively, a “Governmental Entity”); provided, however, that in such event I will give the Company prompt written notice thereof so that the Company Group may seek an appropriate protective order and/or waive in writing compliance with the confidentiality provisions of this Non-Interference Agreement.

(b)Former Employer Information.  I represent that my performance of all of the terms of this Non-Interference Agreement as an employee of the Company Group has not breached and will not breach any agreement to keep in confidence proprietary information, knowledge, or data acquired by me in confidence or trust prior or subsequent to the commencement of my employment with the Company, and I will not disclose to any member of the Company Group, or induce any member of the Company Group to use, any developments, or confidential or proprietary information or material I may have obtained in connection with employment with any prior employer in violation of a confidentiality agreement, nondisclosure agreement, or similar agreement with such prior employer.

(c)Permitted Disclosure.  Nothing in this Non-Interference Agreement shall prohibit or impede me from communicating, cooperating or filing a complaint with any Governmental Entity with respect to possible violations of any U.S. federal, state or local law or regulation, or otherwise making disclosures to any Governmental Entity, in each case, that are protected under the whistleblower provisions of any such law or regulation, provided that in each case such communications and disclosures are consistent with applicable law.  I understand and acknowledge that an individual shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that is made (i) in confidence to a federal, state, or local government official or to an attorney solely for the purpose of reporting or investigating a suspected violation of law, or (ii) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.  I understand and acknowledge further that an individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual files any document containing the trade secret under seal and does not disclose the trade

secret, except pursuant to court order.  Notwithstanding the foregoing, under no circumstance will I be authorized to disclose any information covered by attorney-client privilege or attorney work product of any member of the Company Group without prior written consent of the Company’s General Counsel or other officer designated by the Company.

2.Developments.

(d)Developments Retained and Licensed.  To the extent applicable, I have attached hereto, as Schedule A, a list describing with particularity all developments, original works of authorship, improvements, and trade secrets that were created or owned by me prior to the commencement of my employment (collectively referred to as “Prior Developments”), that belong solely to me or belong to me jointly with another, that relate in any way to any of the proposed businesses, products, or research and development of any member of the Company Group, and that are not assigned to the Company hereunder, or if no such list is attached, I represent that there are no such Prior Developments.  If, during any period during which I perform or performed services for the Company Group both before or after the date hereof (the “Assignment Period”), whether as an officer, employee, director, independent contractor, consultant, or agent, or in any other capacity, I incorporate (or have incorporated) into a Company Group product or process a Prior Development owned by me or in which I have an interest, I hereby grant the Company, and the Company Group or its designee shall have, a non-exclusive, royalty-free, irrevocable, perpetual, transferable worldwide license (with the right to sublicense) to make, have made, copy, modify, make derivative works of, use, sell, and otherwise distribute such Prior Development as part of or in connection with such product or process.  If no Schedule A has been attached hereto, I represent that I have no Prior Developments.

(e)Assignment of Developments.  I agree that I will, without additional compensation, promptly make full written disclosure to the Company, and will hold in trust for the sole right and benefit of the Company all developments, original works of authorship, inventions, concepts, know-how, improvements, trade secrets, and similar proprietary rights, whether or not patentable or registrable under copyright or similar laws, which I may (or have previously) solely or jointly conceive or develop or reduce to practice, or cause to be conceived or developed or reduced to practice, during the Assignment Period, whether or not during regular working hours, provided they either (i) relate at the time of conception or reduction to practice of the invention to the business of any member of the Company Group, or actual or demonstrably anticipated research or development of any member of the Company Group, (ii) result from or relate to any work performed for any member of the Company Group, or (iii) are developed through the use of equipment, supplies, or facilities of any member of the Company Group, or any Confidential Information, or in consultation with personnel of any member of the Company Group (collectively referred to as “Developments”).  I further acknowledge that all Developments made by me (solely or jointly with others) within the scope of and during the Assignment Period are “works made for hire” (to the greatest extent permitted by applicable law) for which I am, in part, compensated by my salary, unless regulated otherwise by law, but that, in the event any such Development is deemed not to be a work made for hire, I hereby assign to the Company, or its designee, all my right, title, and interest throughout the world in and to any such Development.

(f)Maintenance of Records.  I agree to keep and maintain adequate and current written records of all Developments made by me (solely or jointly with others) during the Assignment Period. The records may be in the form of notes, sketches, drawings, flow charts, electronic data or recordings, or any other format.  The records will be available to and remain the sole property of the Company Group at all times.  I agree not to remove such records from the Company’s place of business except as expressly permitted by Company Group policy, which may, from time to time, be revised at the sole election of the Company Group for the purpose of furthering the business of the Company Group.

(g)Intellectual Property Rights.  I agree to assist the Company, or its designee, at the Company’s expense, in every way to secure the rights of the Company Group in the Developments and any copyrights, patents, trademarks, service marks, database rights, domain names, mask work rights, moral rights, and other intellectual property rights relating thereto in any and all countries, including the disclosure to the Company of all pertinent information and data with respect thereto, the execution of all applications, specifications, oaths, assignments, recordations, and all other instruments that the Company shall deem necessary in order to apply for, obtain, maintain, and transfer such rights and in order to assign and convey to the Company Group the sole and exclusive right, title, and interest in and to such Developments, and any intellectual property and other proprietary rights relating thereto.  I further agree that my obligation to execute or cause to be executed, when it is in my power to do so, any such instrument or papers shall continue after the termination of the Assignment Period until the expiration of the last such

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intellectual property right to expire in any country of the world; provided, however, the Company shall reimburse me for my reasonable expenses incurred in connection with carrying out the foregoing obligation.  If the Company is unable because of my mental or physical incapacity or unavailability for any other reason to secure my signature to apply for or to pursue any application for any United States or foreign patents or copyright registrations covering Developments or original works of authorship assigned to the Company as above, then I hereby irrevocably designate and appoint the Company and its duly authorized officers and agents as my agent and attorney in fact to act for and in my behalf and stead to execute and file any such applications or records and to do all other lawfully permitted acts to further the application for, prosecution, issuance, maintenance, and transfer of letters patent or registrations thereon with the same legal force and effect as if originally executed by me.  I hereby waive and irrevocably quitclaim to the Company any and all claims, of any nature whatsoever, that I now or hereafter have for past, present, or future infringement of any and all proprietary rights assigned to the Company.

3.Returning Company Group Documents.

I agree that, at the time of termination of my employment with the Company for any reason, I will deliver to the Company (and will not keep in my possession, recreate, or deliver to anyone else) any and all Confidential Information and all other documents, materials, information, and property developed by me pursuant to my employment or otherwise belonging to the Company. I agree further that any property situated on the premises of, and owned by, the Company (or any other member of the Company Group), including disks and other storage media, filing cabinets, and other work areas, is subject to inspection by personnel of any member of the Company Group at any time with or without notice.  

4.Disclosure of Agreement.

As long as it remains in effect, I will disclose the existence of this Non-Interference Agreement to any prospective employer, partner, co-venturer, investor, or lender prior to entering into an employment, partnership, or other business relationship with such person or entity.

5.Restrictions on Interfering.

(h)Non-Competition.  During the period of my employment with the Company (the “Employment Period”) and the Post-Termination Non-Compete Period, I shall not, directly or indirectly, individually or on behalf of any person, company, enterprise, or entity, or as a sole proprietor, partner, stockholder, director, officer, principal, agent, or executive, or in any other capacity or relationship, engage in any Competitive Activities within the United States of America or any other jurisdiction in which any member of the Company Group engages in business derives a material portion of its revenues or has demonstrable plans to commence business activities in.

(i)Non-Interference.  During the Employment Period and the Post-Termination Non-Solicitation Period, I shall not, directly or indirectly for my own account or for the account of any other individual or entity, engage in Interfering Activities.  

(j)Non-Disparagement.  I agree that during the Employment Period, and the Post-Termination Non-Disparagement Period, I will not make any disparaging or defamatory comments regarding any member of the Company Group or their respective current or former directors, officers, or employees in any respect or make any comments concerning any aspect of my relationship with any member of the Company Group or any conduct or events which precipitated any termination of my employment from any member of the Company Group.  However, my obligations under this subparagraph (c) shall not apply to disclosures required by applicable law, regulation, or order of a court or governmental agency.

(k)Definitions.  For purposes of this agreement:

(i)“Business Relation” shall mean any current or prospective client, customer, licensee, supplier, or other business relation of the Company Group, or any such relation that was a client, customer, licensee or other business relation within the prior six (6)-month period, in each case, with whom I transacted

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business or whose identity became known to me in connection with my relationship with, or employment by, the Company.

(ii)“Competitive Activities” shall mean any business activities related to the owning, operating and/or franchising of select-service hotels primarily serving the midscale and upper-midscale segments, or any other business activity that is materially competitive with the then current or demonstrably planned business activities of the Company Group.

(iii)“Interfering Activities” shall mean (A) encouraging, soliciting, or inducing, or in any manner attempting to encourage, solicit, or induce, any Person employed by, or providing consulting services to, any member of the Company Group to terminate such Person’s employment or services (or in the case of a consultant, materially reducing such services) with the Company Group, (B) hiring any individual who was employed by the Company Group within the six (6)-month period prior to the date of such hiring, or (C) encouraging, soliciting, or inducing, or in any manner attempting to encourage, solicit, or induce, any Business Relation to cease doing business with or reduce the amount of business conducted with the Company Group, or in any way interfering with the relationship between any such Business Relation and the Company Group.

(iv)“Person” shall mean any individual, corporation, partnership, limited liability company, joint venture, association, joint‑stock company, trust (charitable or non-charitable), unincorporated organization, or other form of business entity.

(v)“Post-Termination Non-Compete Period” shall mean the period commencing on the date of the termination of the Employment Period for any reason and ending on the twelve (12)-month anniversary of such date of termination.

(vi)“Post-Termination Non-Solicitation Period” shall mean the period commencing on the date of the termination of the Employment Period for any reason and ending on the twenty-four (24)-month anniversary of such date of termination.

(vii)“Post-Termination Non-Disparagement Period” shall mean the period commencing on the date of the termination of the Employment Period for any reason and ending on the twenty-four (24)-month anniversary of such date of termination.

6.Reasonableness of Restrictions.

I acknowledge and recognize the highly competitive nature of the Company’s business, that access to Confidential Information renders me special and unique within the Company’s industry, and that I will have the opportunity to develop substantial relationships with existing and prospective clients, accounts, customers, consultants, contractors, investors, and strategic partners of the Company Group during the course of and as a result of my employment with the Company.  In light of the foregoing, I recognize and acknowledge that the restrictions and limitations set forth in this Non-Interference Agreement are reasonable and valid in geographical and temporal scope and in all other respects and are essential to protect the value of the business and assets of the Company Group.  I further acknowledge that the restrictions and limitations set forth in this agreement will not materially interfere with my ability to earn a living following the termination of my employment with the Company and that my ability to earn a livelihood without violating such restrictions is a material condition to my employment with the Company.

7.Independence; Severability; Blue Pencil.

Each of the rights enumerated in this Non-Interference Agreement shall be independent of the others and shall be in addition to and not in lieu of any other rights and remedies available to the Company Group at law or in equity.  If any of the provisions of this agreement or any part of any of them is hereafter construed or adjudicated to be invalid or unenforceable, the same shall not affect the remainder of this Non-Interference Agreement, which shall be given full effect without regard to the invalid portions.  If any of the covenants contained herein are held to be invalid or unenforceable because of the duration of such provisions or the area or scope covered thereby, I agree

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that the court making such determination shall have the power to reduce the duration, scope, and/or area of such provision to the maximum and/or broadest duration, scope, and/or area permissible by law, and in its reduced form said provision shall then be enforceable.

8.Injunctive Relief.

I expressly acknowledge that any breach or threatened breach of any of the terms and/or conditions set forth in this Non-Interference Agreement may result in substantial, continuing, and irreparable injury to the members of the Company Group.  Therefore, I hereby agree that, in addition to any other remedy that may be available to the Company, any member of the Company Group shall be entitled to seek injunctive relief, specific performance, monetary damages (e.g., disgorgement of profits or recoupment or forfeiture of any payments or benefits provided under the Plan) or other equitable relief by a court of appropriate jurisdiction in the event of any breach or threatened breach of the terms of this Non-Interference Agreement without the necessity of proving irreparable harm or injury as a result of such breach or threatened breach.  Notwithstanding any other provision to the contrary, I acknowledge and agree that the Post-Termination Non-Compete Period, Post-Termination Non-Solicitation Period and Post-Termination Non-Disparagement Period, as applicable, shall be tolled during any period of violation of any of the covenants in paragraph 5 hereof and during any other period required for litigation during which the Company or any other member of the Company Group seeks to enforce such covenants against me if it is ultimately determined that I was in breach of such covenants.

9.Cooperation.

I agree that, following any termination of my employment, I will continue to provide reasonable cooperation to the Company and/or any other member of the Company Group and its or their respective counsel in connection with any investigation, administrative proceeding, or litigation relating to any matter that occurred during my employment in which I was involved or of which I have knowledge.  As a condition of such cooperation, the Company shall reimburse me for reasonable out-of-pocket expenses incurred at the request of the Company with respect to my compliance with this paragraph.  I also agree that, in the event I am subpoenaed by any person or entity (including, but not limited to, any Governmental Entity) to give testimony or provide documents (in a deposition, court proceeding, or otherwise), that in any way relates to my employment by the Company and/or any other member of the Company Group, I will give prompt notice of such request to the Company and will make no disclosure until the Company and/or the other member of the Company Group has had a reasonable opportunity to contest the right of the requesting person or entity to such disclosure.

10.General Provisions.  

(l)Governing Law; Waiver of Jury Trial.  The validity, interpretation, construction, and performance of this Non-Interference Agreement shall be governed by the laws of the United States of America and the State of Maryland, without giving effect to the principles of conflict of laws. BY EXECUTION OF THIS NON-INTERFERENCE AGREEMENT, I HEREBY WAIVE ANY RIGHT TO TRIAL BY JURY IN CONNECTION WITH ANY SUIT, ACTION, OR PROCEEDING UNDER OR IN CONNECTION WITH THIS NON-INTERFERENCE AGREEMENT.

(m)Entire Agreement.  This Non-Interference Agreement sets forth the entire agreement and understanding between the Company and me relating to the subject matter herein and merges all prior discussions between us.  No modification or amendment to this Non-Interference Agreement, nor any waiver of any rights under this Non-Interference Agreement, will be effective unless in writing signed by the party to be charged.  Any subsequent change or changes in my duties, obligations, rights, or compensation will not affect the validity or scope of this Non-Interference Agreement.

(n)No Right of Continued Employment.  I acknowledge and agree that nothing contained herein shall be construed as granting me any right to continued employment by the Company, and the right of the Company to terminate my employment at any time and for any reason, with or without cause, is specifically reserved.

(o)Successors and Assigns.  This Non-Interference Agreement will be binding upon my heirs,

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executors, administrators, and other legal representatives and will be for the benefit of the Company, its successors, and its assigns.  I expressly acknowledge and agree that this Non-Interference Agreement may be assigned by the Company without my consent to any other member of the Company Group as well as any purchaser of all or substantially all of the assets or stock of the Company, whether by purchase, merger, or other similar corporate transaction, provided that the license granted pursuant to Section 2(a) may be assigned to any third party by the Company without my consent.

(p)Survival.  The provisions of this Non-Interference Agreement shall survive the termination of my employment with the Company and/or the assignment of this Non-Interference Agreement by the Company to any successor in interest or other assignee.

***

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I, _______________________, have executed this Confidentiality, Non-Interference, and Invention Assignment Agreement on the respective date set forth below:

Date:
(Signature)

[Signature Page to Confidentiality, Non-Interference, and Invention Assignment Agreement]

SCHEDULE A

LIST OF PRIOR DEVELOPMENTS
AND ORIGINAL WORKS OF AUTHORSHIP
EXCLUDED FROM SECTION 2

Title Date Identifying Number or Brief Description

_____Additional Sheets Attached

Signature of Executive: ________________________

Print Name of Executive: _______________________

Date: ________________________

EX-10.13

Exhibit 10.13

FINAL VERSION

FORM OF
RESTRICTED STOCK GRANT NOTICE
UNDER THE
COREPOINT LODGING INC.
2018 OMNIBUS INCENTIVE PLAN
(Time-Based Vesting Award)

CorePoint Lodging Inc. (the “Company”), pursuant to its 2018 Omnibus Incentive Plan, as it may be amended and restated from time to time (the “Plan”), hereby grants to the Participant set forth below the number of shares of Restricted Stock set forth below.  The shares of Restricted Stock are subject to all of the terms and conditions as set forth herein, in the Restricted Stock Agreement (attached hereto or previously provided to the Participant in connection with a prior grant), and in the Plan, all of which are incorporated herein in their entirety. Capitalized terms not otherwise defined herein shall have the meaning set forth in the Plan.

Participant: [Insert Participant Name]

Vesting Commencement Date: [●]

Number of Shares of

Restricted Stock: [Insert Number of Shares of Restricted Stock Granted]

Vesting Schedule: Provided the Participant has not undergone a Termination at the time of the vesting date (or event), the Restricted Stock will vest on the fourth (4^th) anniversary of the Vesting Commencement Date;

provided, however, that in the event that (i) such Participant undergoes a Termination by the Service Recipient without Cause, by such Participant for Good Reason, or as a result of such Participant’s death or Disability or (ii) a Change in Control occurs, such Participant shall fully vest in such Participant’s Restricted Stock.

Additional Terms:

• You must notify us immediately if you are making an Internal Revenue Code Section 83(b) Election, and you must send us a copy of the same.

• For purposes hereof, prior to the finding of the existence of Cause under clauses (ii)(A), (B) and (D) of the definition thereof, the Company must provide (x) the Participant written notice setting forth the alleged Cause event and (y) such Participant not less than ten (10) days to fully cure such alleged Cause event.

• “Good Reason” shall, in the case of any Participant who is party to an agreement between the Participant and the Company that contains a definition of “Good Reason”, mean and refer to the definition set forth in such agreement, and in

2

the case of any other Participant, “Good Reason” shall mean: (A) a diminution in Participant’s base salary or material diminution in Participant’s annual bonus opportunity; (B) any material diminution in Participant’s authority, duties or responsibilities; or (C) the relocation of Participant’s principal work location by more than fifty (50) miles; provided that none of these events shall constitute Good Reason unless the Company fails to cure such event within thirty (30) days after receipt from Participant of written notice of the event which constitutes Good Reason; provided, further, that “Good Reason” shall cease to exist for an event on the sixtieth (60^th) day following the later of its occurrence or Participant’s knowledge thereof, unless Participant has given the Company’s written notice thereof prior to such date.  Notwithstanding anything herein to the contrary, for purposes of the last proviso of the immediately foregoing sentence, a series of related events shall be deemed to have occurred on the date upon which the last event in such series of related events has occurred.

• To the extent any Participant is party to an agreement between the Participant and the Company that contains language governing the treatment of equity in connection with a Change in Control, this Restricted Stock Grant Notice shall govern and control regarding the treatment of such Participant’s equity in connection with such Change in Control.

***

COREPOINT LODGING Inc.

________________________________
By: Mark M. Chloupek
Title: General Counsel

[Signature Page to Time-Based Restricted Stock Award]

THE UNDERSIGNED PARTICIPANT ACKNOWLEDGES RECEIPT OF THIS RESTRICTED STOCK GRANT NOTICE, THE RESTRICTED STOCK AGREEMENT AND THE PLAN, AND, AS AN EXPRESS CONDITION TO THE GRANT OF SHARES OF RESTRICTED STOCK HEREUNDER, AGREES TO BE BOUND BY THE TERMS OF THIS RESTRICTED STOCK GRANT NOTICE, THE RESTRICTED STOCK AGREEMENT AND THE PLAN.¹

Participant

________________________________

¹  To the extent that the Company has established, either itself or through a third-party plan administrator, the ability to accept this award electronically, such acceptance shall constitute the Participant’s signature hereto.

[Signature Page to Time-Based Restricted Stock Award]

RESTRICTED STOCK AGREEMENT
UNDER THECOREPOINT LODGING INC.
2018 OMNIBUS INCENTIVE PLAN

Pursuant to the Restricted Stock Grant Notice (the “Grant Notice”) delivered to the Participant (as defined in the Grant Notice), and subject to the terms of this Restricted Stock Agreement (this “Restricted Stock Agreement”) and the CorePoint Lodging Inc. 2018 Omnibus Incentive Plan, as it may be amended and restated from time to time (the “Plan”), CorePoint Lodging Inc. (the “Company”) and the Participant agree as follows.  Capitalized terms not otherwise defined herein shall have the same meaning as set forth in the Plan.

1. Grant of Shares of Restricted Stock.  Subject to the terms and conditions set forth herein and in the Plan, the Company hereby grants to the Participant the number of shares of Restricted Stock provided in the Grant Notice.  The Company may make one or more additional grants of shares of Restricted Stock to the Participant under this Restricted Stock Agreement by providing the Participant with a new Grant Notice, which may also include any terms and conditions differing from this Restricted Stock Agreement to the extent provided therein.  The Company reserves all rights with respect to the granting of additional shares of Restricted Stock hereunder and makes no implied promise to grant additional shares of Restricted Stock.

2. Vesting.  Subject to the conditions contained herein and in the Plan, the shares of Restricted Stock shall vest and the restrictions on such shares of Restricted Stock shall lapse as provided in the Grant Notice.  With respect to any share of Restricted Stock, the period of time that such share of Restricted Stock remains subject to vesting shall be its Restricted Period.

3. Issuance of Shares of Restricted Stock.  The provisions of Section 8(d)(i) of the Plan are incorporated herein by reference and made a part hereof.

4. Treatment of Shares of Restricted Stock Upon Termination.  Unless otherwise provided by the Committee, in the event of the Participant’s Termination for any reason:  

(a) all vesting with respect to the Restricted Stock shall cease (after taking into account any vesting of Restricted Stock as set forth in the Grant Notice); and

(b) the unvested shares of Restricted Stock shall be forfeited to the Company by the Participant for no consideration as of the date of such Termination.

5. Company; Participant.

(a) The term “Company” as used in this Restricted Stock Agreement with reference to employment shall include the Company and its subsidiaries.

(b) Whenever the word “Participant” is used in any provision of this Restricted Stock Agreement under circumstances where the provision should logically be construed to apply to the executors, the administrators, or the person or persons to whom the shares of Restricted Stock may be transferred by will or by the laws of descent and distribution, the word “Participant” shall be deemed to include such person or persons.

6. Non-Transferability.  The shares of Restricted Stock are not transferable by the Participant except to Permitted Transferees in accordance with Section 14(b) of the Plan.  Except as

6

otherwise provided herein, no assignment or transfer of the shares of Restricted Stock, or of the rights represented thereby, whether voluntary or involuntary, by operation of law or otherwise, shall vest in the assignee or transferee any interest or right herein whatsoever, but immediately upon such assignment or transfer the shares of Restricted Stock shall terminate and become of no further effect.

7. Rights as Stockholder; Legend. The provisions of Sections 8(b) and 8(e) of the Plan are incorporated herein by reference and made a part hereof.

8. Tax Withholding.  The provisions of Section 14(d) of the Plan are incorporated herein by reference and made a part hereof.

9. Notice.  Every notice or other communication relating to this Restricted Stock Agreement between the Company and the Participant shall be in writing, and shall be mailed to or delivered to the party for whom it is intended at such address as may from time to time be designated by such party in a notice mailed or delivered to the other party as herein provided; provided that, unless and until some other address be so designated, all notices or communications by the Participant to the Company shall be mailed or delivered to the Company at its principal executive office, to the attention of the Company General Counsel, and all notices or communications by the Company to the Participant may be given to the Participant personally or may be mailed to the Participant at the Participant’s last known address, as reflected in the Company’s records.  Notwithstanding the above, all notices and communications between the Participant and any third-party plan administrator shall be mailed, delivered, transmitted or sent in accordance with the procedures established by such third-party plan administrator and communicated to the Participant from time to time.

10. No Right to Continued Service.  This Restricted Stock Agreement does not confer upon the Participant any right to continue as an employee or service provider to the Company.

11. Binding Effect.  This Restricted Stock Agreement shall be binding upon the heirs, executors, administrators and successors of the parties hereto.

12. Waiver and Amendments.  Except as otherwise set forth in Section 13 of the Plan, any waiver, alteration, amendment or modification of any of the terms of this Restricted Stock Agreement shall be valid only if made in writing and signed by the parties hereto; provided, however, that any such waiver, alteration, amendment or modification is consented to on the Company’s behalf by the Committee.  No waiver by either of the parties hereto of their rights hereunder shall be deemed to constitute a waiver with respect to any subsequent occurrences or transactions hereunder unless such waiver specifically states that it is to be construed as a continuing waiver.

13. Governing Law.  This Restricted Stock Agreement shall be construed and interpreted in accordance with the laws of the State of Maryland, without regard to the principles of conflicts of law thereof.  Notwithstanding anything contained in this Restricted Stock Agreement, the Grant Notice or the Plan to the contrary, if any suit or claim is instituted by the Participant or the Company relating to this Restricted Stock Agreement, the Grant Notice or the Plan, the Participant hereby submits to the exclusive jurisdiction of and venue in the courts of Maryland.

14. Plan.  The terms and provisions of the Plan are incorporated herein by reference.  In the event of a conflict or inconsistency between the terms and provisions of the Plan and the provisions of this Restricted Stock Agreement, the Plan shall govern and control.

EX-10.14

Exhibit 10.14

FINAL VERSION

FORM OF
RESTRICTED STOCK GRANT NOTICE
UNDER THE
COREPOINT LODGING INC.
2018 OMNIBUS INCENTIVE PLAN
(Time-Based Vesting Award)

CorePoint Lodging Inc. (the “Company”), pursuant to its 2018 Omnibus Incentive Plan, as it may be amended and restated from time to time (the “Plan”), hereby grants to the Participant set forth below the number of shares of Restricted Stock set forth below.  The shares of Restricted Stock are subject to all of the terms and conditions as set forth herein, in the Restricted Stock Agreement (attached hereto or previously provided to the Participant in connection with a prior grant), and in the Plan, all of which are incorporated herein in their entirety. Capitalized terms not otherwise defined herein shall have the meaning set forth in the Plan.

Participant: [Insert Participant Name]

Vesting Commencement Date: [●]

Number of Shares of

Restricted Stock: [Insert Number of Shares of Restricted Stock Granted]

Vesting Schedule: Provided the Participant has not undergone a Termination at the time of the vesting date (or event), the Restricted Stock will vest on the third (3^rd) anniversary of the Vesting Commencement Date;

provided, however, that in the event that (i) such Participant undergoes a Termination by the Service Recipient without Cause, by such Participant for Good Reason, or as a result of such Participant’s death or Disability or (ii) a Change in Control occurs, such Participant shall fully vest in such Participant’s Restricted Stock.

Additional Terms:

• You must notify us immediately if you are making an Internal Revenue Code Section 83(b) Election, and you must send us a copy of the same.

• For purposes hereof, prior to the finding of the existence of Cause under clauses (ii)(A), (B) and (D) of the definition thereof, the Company must provide (x) the Participant written notice setting forth the alleged Cause event and (y) such Participant not less than ten (10) days to fully cure such alleged Cause event.

• “Good Reason” shall, in the case of any Participant who is party to an agreement between the Participant and the Company that contains a definition of “Good Reason”, mean and refer to the definition set forth in such agreement, and in the case of any other Participant, “Good Reason” shall mean:

2

(A) a diminution in Participant’s base salary or material diminution in Participant’s annual bonus opportunity; (B) any material diminution in Participant’s authority, duties or responsibilities; or (C) the relocation of Participant’s principal work location by more than fifty (50) miles; provided that none of these events shall constitute Good Reason unless the Company fails to cure such event within thirty (30) days after receipt from Participant of written notice of the event which constitutes Good Reason; provided, further, that “Good Reason” shall cease to exist for an event on the sixtieth (60^th) day following the later of its occurrence or Participant’s knowledge thereof, unless Participant has given the Company’s written notice thereof prior to such date.  Notwithstanding anything herein to the contrary, for purposes of the last proviso of the immediately foregoing sentence, a series of related events shall be deemed to have occurred on the date upon which the last event in such series of related events has occurred.

• To the extent any Participant is party to an agreement between the Participant and the Company that contains language governing the treatment of equity in connection with a Change in Control, this Restricted Stock Grant Notice shall govern and control regarding the treatment of such Participant’s equity in connection with such Change in Control.

***

COREPOINT LODGING Inc.

________________________________
By: Mark M. Chloupek
Title: General Counsel

[Signature Page to Time-Based Restricted Stock Award]

THE UNDERSIGNED PARTICIPANT ACKNOWLEDGES RECEIPT OF THIS RESTRICTED STOCK GRANT NOTICE, THE RESTRICTED STOCK AGREEMENT AND THE PLAN, AND, AS AN EXPRESS CONDITION TO THE GRANT OF SHARES OF RESTRICTED STOCK HEREUNDER, AGREES TO BE BOUND BY THE TERMS OF THIS RESTRICTED STOCK GRANT NOTICE, THE RESTRICTED STOCK AGREEMENT AND THE PLAN.¹

Participant

________________________________

¹  To the extent that the Company has established, either itself or through a third-party plan administrator, the ability to accept this award electronically, such acceptance shall constitute the Participant’s signature hereto.

[Signature Page to Time-Based Restricted Stock Award]

RESTRICTED STOCK AGREEMENT
UNDER THECOREPOINT LODGING INC.
2018 OMNIBUS INCENTIVE PLAN

Pursuant to the Restricted Stock Grant Notice (the “Grant Notice”) delivered to the Participant (as defined in the Grant Notice), and subject to the terms of this Restricted Stock Agreement (this “Restricted Stock Agreement”) and the CorePoint Lodging Inc. 2018 Omnibus Incentive Plan, as it may be amended and restated from time to time (the “Plan”), CorePoint Lodging Inc. (the “Company”) and the Participant agree as follows.  Capitalized terms not otherwise defined herein shall have the same meaning as set forth in the Plan.

1. Grant of Shares of Restricted Stock.  Subject to the terms and conditions set forth herein and in the Plan, the Company hereby grants to the Participant the number of shares of Restricted Stock provided in the Grant Notice.  The Company may make one or more additional grants of shares of Restricted Stock to the Participant under this Restricted Stock Agreement by providing the Participant with a new Grant Notice, which may also include any terms and conditions differing from this Restricted Stock Agreement to the extent provided therein.  The Company reserves all rights with respect to the granting of additional shares of Restricted Stock hereunder and makes no implied promise to grant additional shares of Restricted Stock.

2. Vesting.  Subject to the conditions contained herein and in the Plan, the shares of Restricted Stock shall vest and the restrictions on such shares of Restricted Stock shall lapse as provided in the Grant Notice.  With respect to any share of Restricted Stock, the period of time that such share of Restricted Stock remains subject to vesting shall be its Restricted Period.

3. Issuance of Shares of Restricted Stock.  The provisions of Section 8(d)(i) of the Plan are incorporated herein by reference and made a part hereof.

4. Treatment of Shares of Restricted Stock Upon Termination.  Unless otherwise provided by the Committee, in the event of the Participant’s Termination for any reason:  

(a) all vesting with respect to the Restricted Stock shall cease (after taking into account any vesting of Restricted Stock as set forth in the Grant Notice); and

(b) the unvested shares of Restricted Stock shall be forfeited to the Company by the Participant for no consideration as of the date of such Termination.

5. Company; Participant.

(a) The term “Company” as used in this Restricted Stock Agreement with reference to employment shall include the Company and its subsidiaries.

(b) Whenever the word “Participant” is used in any provision of this Restricted Stock Agreement under circumstances where the provision should logically be construed to apply to the executors, the administrators, or the person or persons to whom the shares of Restricted Stock may be transferred by will or by the laws of descent and distribution, the word “Participant” shall be deemed to include such person or persons.

6. Non-Transferability.  The shares of Restricted Stock are not transferable by the Participant except to Permitted Transferees in accordance with Section 14(b) of the Plan.  Except as

6

otherwise provided herein, no assignment or transfer of the shares of Restricted Stock, or of the rights represented thereby, whether voluntary or involuntary, by operation of law or otherwise, shall vest in the assignee or transferee any interest or right herein whatsoever, but immediately upon such assignment or transfer the shares of Restricted Stock shall terminate and become of no further effect.

7. Rights as Stockholder; Legend. The provisions of Sections 8(b) and 8(e) of the Plan are incorporated herein by reference and made a part hereof.

8. Tax Withholding.  The provisions of Section 14(d) of the Plan are incorporated herein by reference and made a part hereof.

9. Notice.  Every notice or other communication relating to this Restricted Stock Agreement between the Company and the Participant shall be in writing, and shall be mailed to or delivered to the party for whom it is intended at such address as may from time to time be designated by such party in a notice mailed or delivered to the other party as herein provided; provided that, unless and until some other address be so designated, all notices or communications by the Participant to the Company shall be mailed or delivered to the Company at its principal executive office, to the attention of the Company General Counsel, and all notices or communications by the Company to the Participant may be given to the Participant personally or may be mailed to the Participant at the Participant’s last known address, as reflected in the Company’s records.  Notwithstanding the above, all notices and communications between the Participant and any third-party plan administrator shall be mailed, delivered, transmitted or sent in accordance with the procedures established by such third-party plan administrator and communicated to the Participant from time to time.

10. No Right to Continued Service.  This Restricted Stock Agreement does not confer upon the Participant any right to continue as an employee or service provider to the Company.

11. Binding Effect.  This Restricted Stock Agreement shall be binding upon the heirs, executors, administrators and successors of the parties hereto.

12. Waiver and Amendments.  Except as otherwise set forth in Section 13 of the Plan, any waiver, alteration, amendment or modification of any of the terms of this Restricted Stock Agreement shall be valid only if made in writing and signed by the parties hereto; provided, however, that any such waiver, alteration, amendment or modification is consented to on the Company’s behalf by the Committee.  No waiver by either of the parties hereto of their rights hereunder shall be deemed to constitute a waiver with respect to any subsequent occurrences or transactions hereunder unless such waiver specifically states that it is to be construed as a continuing waiver.

13. Governing Law.  This Restricted Stock Agreement shall be construed and interpreted in accordance with the laws of the State of Maryland, without regard to the principles of conflicts of law thereof.  Notwithstanding anything contained in this Restricted Stock Agreement, the Grant Notice or the Plan to the contrary, if any suit or claim is instituted by the Participant or the Company relating to this Restricted Stock Agreement, the Grant Notice or the Plan, the Participant hereby submits to the exclusive jurisdiction of and venue in the courts of Maryland.

14. Plan.  The terms and provisions of the Plan are incorporated herein by reference.  In the event of a conflict or inconsistency between the terms and provisions of the Plan and the provisions of this Restricted Stock Agreement, the Plan shall govern and control.

EX-10.15

Exhibit 10.15

FINAL VERSION

FORM OF
RESTRICTED STOCK GRANT NOTICE
UNDER THE
COREPOINT LODGING Inc.
2018 OMNIBUS INCENTIVE PLAN
(Time-Based Vesting Award)

CorePoint Lodging Inc. (the “Company”), pursuant to its 2018 Omnibus Incentive Plan, as it may be amended and restated from time to time (the “Plan”), hereby grants to the Participant set forth below the number of shares of Restricted Stock set forth below.  The shares of Restricted Stock are subject to all of the terms and conditions as set forth herein, in the Restricted Stock Agreement (attached hereto or previously provided to the Participant in connection with a prior grant), and in the Plan, all of which are incorporated herein in their entirety.  The Participant acknowledges and agrees that the Restricted Stock granted hereunder is in full satisfaction of any commitment by the Company, pursuant to any offer letter or similar agreement or arrangement, to grant Performance Share Units (or PSUs) in respect of the 2018 calendar year.  Capitalized terms not otherwise defined herein shall have the meaning set forth in the Plan.

Participant: [Insert Participant Name]

Vesting Commencement Date: [●]

Number of Shares of

Restricted Stock: [Insert No. of Shares of Restricted Stock Granted]

Vesting Schedule: Provided the Participant has not undergone a Termination at the time of each applicable vesting date (or event):

• One third (1/3) of the Restricted Stock will vest on the Vesting Commencement Date;

• One third (1/3) of the Restricted Stock will vest on the first anniversary of the Vesting Commencement Date; and

• One third (1/3) of the Restricted Stock will vest on the second anniversary of the Vesting Commencement Date;

provided, however, that in the event that (i) prior to a Change in Control, the Participant undergoes a Termination as a result of such Participant’s death or Disability, or (ii) on or following a Change in Control, such Participant undergoes a Termination by the Service Recipient without Cause, by such Participant for Good Reason, or as a result of such Participant’s death or Disability, such Participant shall fully vest in such Participant’s Restricted Stock; and

provided, further, that in the event that prior to a Change in Control the Participant undergoes a Termination by the Service Recipient without Cause or by such Participant for Good Reason, such Participant shall vest with respect to what would have vested on the next scheduled vesting date.

2

Additional Terms:

• You must notify us immediately if you are making an Internal Revenue Code Section 83(b) Election, and you must send us a copy of the same.

• For purposes hereof, prior to the finding of the existence of Cause under clauses (ii)(A), (B) and (D) of the definition thereof, the Company must provide (x) the Participant written notice setting forth the alleged Cause event and (y) such Participant not less than ten (10) days to fully cure such alleged Cause event.

• “Good Reason” shall, in the case of any Participant who is party to an agreement between the Participant and the Company that contains a definition of “Good Reason”, mean and refer to the definition set forth in such agreement, and in the case of any other Participant, “Good Reason” shall mean: (A) a diminution in Participant’s base salary or material diminution in Participant’s annual bonus opportunity; (B) any material diminution in Participant’s authority, duties or responsibilities; or (C) the relocation of Participant’s principal work location by more than fifty (50) miles; provided that none of these events shall constitute Good Reason unless the Company fails to cure such event within thirty (30) days after receipt from Participant of written notice of the event which constitutes Good Reason; provided, further, that “Good Reason” shall cease to exist for an event on the sixtieth (60^th) day following the later of its occurrence or Participant’s knowledge thereof, unless Participant has given the Company’s written notice thereof prior to such date.  Notwithstanding anything herein to the contrary, for purposes of the last proviso of the immediately foregoing sentence, a series of related events shall be deemed to have occurred on the date upon which the last event in such series of related events has occurred.

• To the extent any Participant is party to an agreement between the Participant and the Company that contains language governing the treatment of equity in connection with a Change in Control, this Restricted Stock Grant Notice shall govern and control regarding the treatment of such Participant’s equity in connection with such Change in Control.

***

COREPOINT LODGING Inc.

________________________________
By: Mark M. Chloupek
Title: General Counsel

[Signature Page to Time-Based Restricted Stock Award]

THE UNDERSIGNED PARTICIPANT ACKNOWLEDGES RECEIPT OF THIS RESTRICTED STOCK GRANT NOTICE, THE RESTRICTED STOCK AGREEMENT AND THE PLAN, AND, AS AN EXPRESS CONDITION TO THE GRANT OF SHARES OF RESTRICTED STOCK HEREUNDER, AGREES TO BE BOUND BY THE TERMS OF THIS RESTRICTED STOCK GRANT NOTICE, THE RESTRICTED STOCK AGREEMENT AND THE PLAN.¹

Participant

________________________________

¹  To the extent that the Company has established, either itself or through a third-party plan administrator, the ability to accept this award electronically, such acceptance shall constitute the Participant’s signature hereto.

[Signature Page to Time-Based Restricted Stock Award]

RESTRICTED STOCK AGREEMENT
UNDER THECOREPOINT LODGING Inc.
2018 OMNIBUS INCENTIVE PLAN

Pursuant to the Restricted Stock Grant Notice (the “Grant Notice”) delivered to the Participant (as defined in the Grant Notice), and subject to the terms of this Restricted Stock Agreement (this “Restricted Stock Agreement”) and the CorePoint Lodging Inc. 2018 Omnibus Incentive Plan, as it may be amended and restated from time to time (the “Plan”), CorePoint Lodging Inc. (the “Company”) and the Participant agree as follows. Capitalized terms not otherwise defined herein shall have the same meaning as set forth in the Plan.

1. Grant of Shares of Restricted Stock.  Subject to the terms and conditions set forth herein and in the Plan, the Company hereby grants to the Participant the number of shares of Restricted Stock provided in the Grant Notice.  The Company may make one or more additional grants of shares of Restricted Stock to the Participant under this Restricted Stock Agreement by providing the Participant with a new Grant Notice, which may also include any terms and conditions differing from this Restricted Stock Agreement to the extent provided therein.  The Company reserves all rights with respect to the granting of additional shares of Restricted Stock hereunder and makes no implied promise to grant additional shares of Restricted Stock.  

2. Vesting.  Subject to the conditions contained herein and in the Plan, the shares of Restricted Stock shall vest and the restrictions on such shares of Restricted Stock shall lapse as provided in the Grant Notice.  With respect to any share of Restricted Stock, the period of time that such share of Restricted Stock remains subject to vesting shall be its Restricted Period.

3. Issuance of Shares of Restricted Stock.  The provisions of Section 8(d)(i) of the Plan are incorporated herein by reference and made a part hereof.

4. Treatment of Shares of Restricted Stock Upon Termination.  Unless otherwise provided by the Committee, in the event of the Participant’s Termination for any reason:  

(a) all vesting with respect to the Restricted Stock shall cease (after taking into account any vesting of Restricted Stock as set forth in the Grant Notice); and

(b) the unvested shares of Restricted Stock shall be forfeited to the Company by the Participant for no consideration as of the date of such Termination.

5. Company; Participant.

(a) The term “Company” as used in this Restricted Stock Agreement with reference to employment shall include the Company and its subsidiaries.

(b) Whenever the word “Participant” is used in any provision of this Restricted Stock Agreement under circumstances where the provision should logically be construed to apply to the executors, the administrators, or the person or persons to whom the shares of Restricted Stock may be transferred by will or by the laws of descent and distribution, the word “Participant” shall be deemed to include such person or persons.

6. Non-Transferability.  The shares of Restricted Stock are not transferable by the Participant except to Permitted Transferees in accordance with Section 14(b) of the Plan.  Except as

otherwise provided herein, no assignment or transfer of the shares of Restricted Stock, or of the rights represented thereby, whether voluntary or involuntary, by operation of law or otherwise, shall vest in the assignee or transferee any interest or right herein whatsoever, but immediately upon such assignment or transfer the shares of Restricted Stock shall terminate and become of no further effect.

7. Rights as Stockholder; Legend. The provisions of Sections 8(b) and 8(e) of the Plan are incorporated herein by reference and made a part hereof.

8. Tax Withholding.  The provisions of Section 14(d) of the Plan are incorporated herein by reference and made a part hereof.

9. Notice.  Every notice or other communication relating to this Restricted Stock Agreement between the Company and the Participant shall be in writing, and shall be mailed to or delivered to the party for whom it is intended at such address as may from time to time be designated by such party in a notice mailed or delivered to the other party as herein provided; provided that, unless and until some other address be so designated, all notices or communications by the Participant to the Company shall be mailed or delivered to the Company at its principal executive office, to the attention of the Company General Counsel, and all notices or communications by the Company to the Participant may be given to the Participant personally or may be mailed to the Participant at the Participant’s last known address, as reflected in the Company’s records.  Notwithstanding the above, all notices and communications between the Participant and any third-party plan administrator shall be mailed, delivered, transmitted or sent in accordance with the procedures established by such third-party plan administrator and communicated to the Participant from time to time.

10. No Right to Continued Service.  This Restricted Stock Agreement does not confer upon the Participant any right to continue as an employee or service provider to the Company.

11. Binding Effect.  This Restricted Stock Agreement shall be binding upon the heirs, executors, administrators and successors of the parties hereto.

12. Waiver and Amendments.  Except as otherwise set forth in Section 13 of the Plan, any waiver, alteration, amendment or modification of any of the terms of this Restricted Stock Agreement shall be valid only if made in writing and signed by the parties hereto; provided, however, that any such waiver, alteration, amendment or modification is consented to on the Company’s behalf by the Committee.  No waiver by either of the parties hereto of their rights hereunder shall be deemed to constitute a waiver with respect to any subsequent occurrences or transactions hereunder unless such waiver specifically states that it is to be construed as a continuing waiver.

13. Governing Law.  This Restricted Stock Agreement shall be construed and interpreted in accordance with the laws of the State of Maryland, without regard to the principles of conflicts of law thereof.  Notwithstanding anything contained in this Restricted Stock Agreement, the Grant Notice or the Plan to the contrary, if any suit or claim is instituted by the Participant or the Company relating to this Restricted Stock Agreement, the Grant Notice or the Plan, the Participant hereby submits to the exclusive jurisdiction of and venue in the courts of Maryland.

14. Plan.  The terms and provisions of the Plan are incorporated herein by reference.  In the event of a conflict or inconsistency between the terms and provisions of the Plan and the provisions of this Restricted Stock Agreement, the Plan shall govern and control.

EX-10.16

Exhibit 10.16

FINAL VERSION

FORM OF
RESTRICTED STOCK GRANT NOTICE
UNDER THE
COREPOINT LODGING Inc.
2018 OMNIBUS INCENTIVE PLAN
(Time-Based Vesting Award)

CorePoint Lodging Inc. (the “Company”), pursuant to its 2018 Omnibus Incentive Plan, as it may be amended and restated from time to time (the “Plan”), hereby grants to the Participant set forth below the number of shares of Restricted Stock set forth below.  The shares of Restricted Stock are subject to all of the terms and conditions as set forth herein, in the Restricted Stock Agreement (attached hereto or previously provided to the Participant in connection with a prior grant), and in the Plan, all of which are incorporated herein in their entirety. Capitalized terms not otherwise defined herein shall have the meaning set forth in the Plan.

Participant: [Insert Participant Name]

Vesting Commencement Date: [Insert Vesting Commencement Date]

Number of Shares of

Restricted Stock: [Insert No. of Shares of Restricted Stock Granted]

Vesting Schedule: Provided the Participant has not undergone a Termination at the time of each applicable vesting date (or event):

• One third (1/3) of the Restricted Stock will vest on the Vesting Commencement Date;

• One third (1/3) of the Restricted Stock will vest on the first anniversary of the Vesting Commencement Date; and

• One third (1/3) of the Restricted Stock will vest on the second anniversary of the Vesting Commencement Date;

provided, however, that in the event that (i) the Participant undergoes a Termination as a result of such Participant’s death or Disability, or (ii) a Change in Control occurs, such Participant shall fully vest in such Participant’s Restricted Stock.

Additional Terms:

• You must notify us immediately if you are making an Internal Revenue Code Section 83(b) Election, and you must send us a copy of the same.

***

COREPOINT LODGING Inc.

________________________________
By: Mark M. Chloupek
Title: General Counsel

[Signature Page to Time-Based Restricted Stock Award]

THE UNDERSIGNED PARTICIPANT ACKNOWLEDGES RECEIPT OF THIS RESTRICTED STOCK GRANT NOTICE, THE RESTRICTED STOCK AGREEMENT AND THE PLAN, AND, AS AN EXPRESS CONDITION TO THE GRANT OF SHARES OF RESTRICTED STOCK HEREUNDER, AGREES TO BE BOUND BY THE TERMS OF THIS RESTRICTED STOCK GRANT NOTICE, THE RESTRICTED STOCK AGREEMENT AND THE PLAN.¹

Participant

________________________________

¹  To the extent that the Company has established, either itself or through a third-party plan administrator, the ability to accept this award electronically, such acceptance shall constitute the Participant’s signature hereto.

[Signature Page to Time-Based Restricted Stock Award]

RESTRICTED STOCK AGREEMENT
UNDER THECOREPOINT LODGING Inc.
2018 OMNIBUS INCENTIVE PLAN

Pursuant to the Restricted Stock Grant Notice (the “Grant Notice”) delivered to the Participant (as defined in the Grant Notice), and subject to the terms of this Restricted Stock Agreement (this “Restricted Stock Agreement”) and the CorePoint Lodging Inc. 2018 Omnibus Incentive Plan, as it may be amended and restated from time to time (the “Plan”), CorePoint Lodging Inc. (the “Company”) and the Participant agree as follows.  Capitalized terms not otherwise defined herein shall have the same meaning as set forth in the Plan.

1. Grant of Shares of Restricted Stock.  Subject to the terms and conditions set forth herein and in the Plan, the Company hereby grants to the Participant the number of shares of Restricted Stock provided in the Grant Notice.  The Company may make one or more additional grants of shares of Restricted Stock to the Participant under this Restricted Stock Agreement by providing the Participant with a new Grant Notice, which may also include any terms and conditions differing from this Restricted Stock Agreement to the extent provided therein.  The Company reserves all rights with respect to the granting of additional shares of Restricted Stock hereunder and makes no implied promise to grant additional shares of Restricted Stock.

2. Vesting.  Subject to the conditions contained herein and in the Plan, the shares of Restricted Stock shall vest and the restrictions on such shares of Restricted Stock shall lapse as provided in the Grant Notice.  With respect to any share of Restricted Stock, the period of time that such share of Restricted Stock remains subject to vesting shall be its Restricted Period.

3. Issuance of Shares of Restricted Stock.  The provisions of Section 8(d)(i) of the Plan are incorporated herein by reference and made a part hereof.

4. Treatment of Shares of Restricted Stock Upon Termination.  Unless otherwise provided by the Committee, in the event of the Participant’s Termination for any reason:  

(a) all vesting with respect to the Restricted Stock shall cease (after taking into account any vesting of Restricted Stock as set forth in the Grant Notice); and

(b) the unvested shares of Restricted Stock shall be forfeited to the Company by the Participant for no consideration as of the date of such Termination.

5. Company; Participant.

(a) The term “Company” as used in this Restricted Stock Agreement with reference to employment shall include the Company and its subsidiaries.

(b) Whenever the word “Participant” is used in any provision of this Restricted Stock Agreement under circumstances where the provision should logically be construed to apply to the executors, the administrators, or the person or persons to whom the shares of Restricted Stock may be transferred by will or by the laws of descent and distribution, the word “Participant” shall be deemed to include such person or persons.

6. Non-Transferability.  The shares of Restricted Stock are not transferable by the Participant except to Permitted Transferees in accordance with Section 14(b) of the Plan.  Except as

otherwise provided herein, no assignment or transfer of the shares of Restricted Stock, or of the rights represented thereby, whether voluntary or involuntary, by operation of law or otherwise, shall vest in the assignee or transferee any interest or right herein whatsoever, but immediately upon such assignment or transfer the shares of Restricted Stock shall terminate and become of no further effect.

7. Rights as Stockholder; Legend. The provisions of Sections 8(b) and 8(e) of the Plan are incorporated herein by reference and made a part hereof.

8. Tax Withholding.  The provisions of Section 14(d) of the Plan are incorporated herein by reference and made a part hereof.

9. Notice.  Every notice or other communication relating to this Restricted Stock Agreement between the Company and the Participant shall be in writing, and shall be mailed to or delivered to the party for whom it is intended at such address as may from time to time be designated by such party in a notice mailed or delivered to the other party as herein provided; provided that, unless and until some other address be so designated, all notices or communications by the Participant to the Company shall be mailed or delivered to the Company at its principal executive office, to the attention of the Company General Counsel, and all notices or communications by the Company to the Participant may be given to the Participant personally or may be mailed to the Participant at the Participant’s last known address, as reflected in the Company’s records.  Notwithstanding the above, all notices and communications between the Participant and any third-party plan administrator shall be mailed, delivered, transmitted or sent in accordance with the procedures established by such third-party plan administrator and communicated to the Participant from time to time.

10. No Right to Continued Service.  This Restricted Stock Agreement does not confer upon the Participant any right to continue as an employee or service provider to the Company.

11. Binding Effect.  This Restricted Stock Agreement shall be binding upon the heirs, executors, administrators and successors of the parties hereto.

12. Waiver and Amendments.  Except as otherwise set forth in Section 13 of the Plan, any waiver, alteration, amendment or modification of any of the terms of this Restricted Stock Agreement shall be valid only if made in writing and signed by the parties hereto; provided, however, that any such waiver, alteration, amendment or modification is consented to on the Company’s behalf by the Committee.  No waiver by either of the parties hereto of their rights hereunder shall be deemed to constitute a waiver with respect to any subsequent occurrences or transactions hereunder unless such waiver specifically states that it is to be construed as a continuing waiver.

13. Governing Law.  This Restricted Stock Agreement shall be construed and interpreted in accordance with the laws of the State of Maryland, without regard to the principles of conflicts of law thereof.  Notwithstanding anything contained in this Restricted Stock Agreement, the Grant Notice or the Plan to the contrary, if any suit or claim is instituted by the Participant or the Company relating to this Restricted Stock Agreement, the Grant Notice or the Plan, the Participant hereby submits to the exclusive jurisdiction of and venue in the courts of Maryland.

14. Plan.  The terms and provisions of the Plan are incorporated herein by reference.  In the event of a conflict or inconsistency between the terms and provisions of the Plan and the provisions of this Restricted Stock Agreement, the Plan shall govern and control.

EX-10.17

Exhibit 10.17

FORM OF
RESTRICTED STOCK GRANT NOTICE
UNDER THE
cOREpOINT LODGING Inc.
2018 OMNIBUS INCENTIVE PLAN
(Time-Based Vesting Award)

CorePoint Lodging Inc. (the “Company”), pursuant to its 2018 Omnibus Incentive Plan, as it may be amended and restated from time to time (the “Plan”), hereby grants to the Participant set forth below the number of shares of Restricted Stock set forth below in full satisfaction of the grants required to be made pursuant to the terms of the Employee Matters Agreement between the Company and La Quinta Holdings Inc., dated January 17, 2018 (the “EMA”) in respect of certain LQ RSAs (as defined in the EMA) granted to such Participant under the Amended and Restated La Quinta Holdings Inc. 2014 Omnibus Incentive Plan.  The shares of Restricted Stock are subject to all of the terms and conditions as set forth herein, in the Restricted Stock Agreement (attached hereto or previously provided to the Participant in connection with a prior grant), and in the Plan, all of which are incorporated herein in their entirety. For purposes of the Plan, the Restricted Stock granted hereunder shall be considered a Substitute Award.  Capitalized terms not otherwise defined herein shall have the meaning set forth in the Plan.

Participant: [Insert Participant Name]

Number of Shares of

Restricted Stock: [Insert No. of Shares of Restricted Stock Granted]

Vesting Schedule: Provided the Participant has not undergone a Termination at the time of each applicable vesting date (or event):

• [One half (1/2) of the Restricted Stock will vest on [●]; and

• One half (1/2) of the Restricted Stock will vest on [●];]

• [all of the Restricted Stock will vest on [●];]

provided, however, that in the event that (i) prior to a Change in Control, the Participant undergoes a Termination as a result of such Participant’s death or Disability, or (ii) on or following a Change in Control, such Participant undergoes a Termination by the Service Recipient without Cause, by such Participant for Good Reason, or as a result of such Participant’s death or Disability, such Participant shall fully vest in such Participant’s Restricted Stock; and

provided, further, that in the event that prior to a Change in Control the Participant undergoes a Termination by the Service Recipient without Cause or by such Participant for Good Reason, such Participant shall vest with respect to what would have vested on the next scheduled vesting date.

Additional Terms:

2

• You must notify us immediately if you are making an Internal Revenue Code Section 83(b) Election, and you must send us a copy of the same.

• For purposes hereof, prior to the finding of the existence of Cause under clauses (ii)(A), (B) and (D) of the definition thereof, the Company must provide (x) the Participant written notice setting forth the alleged Cause event and (y) such Participant not less than ten (10) days to fully cure such alleged Cause event.

• “Good Reason” shall, in the case of any Participant who is party to an agreement between the Participant and the Company that contains a definition of “Good Reason”, mean and refer to the definition set forth in such agreement, and in the case of any other Participant, “Good Reason” shall mean: (A) a diminution in Participant’s base salary or material diminution in Participant’s annual bonus opportunity; (B) any material diminution in Participant’s authority, duties or responsibilities; or (C) the relocation of Participant’s principal work location by more than fifty (50) miles; provided that none of these events shall constitute Good Reason unless the Company fails to cure such event within thirty (30) days after receipt from Participant of written notice of the event which constitutes Good Reason; provided, further, that “Good Reason” shall cease to exist for an event on the sixtieth (60^th) day following the later of its occurrence or Participant’s knowledge thereof, unless Participant has given the Company’s written notice thereof prior to such date.  Notwithstanding anything herein to the contrary, for purposes of the last proviso of the immediately foregoing sentence, a series of related events shall be deemed to have occurred on the date upon which the last event in such series of related events has occurred.

• To the extent the Participant is party to an agreement between the Participant and the Company that contains language governing the treatment of equity in connection with a Change in Control, this Restricted Stock Grant Notice shall govern and control regarding the treatment of such Participant’s equity in connection with such Change in Control.

***

Corepoint lodging Inc.

________________________________
By: Mark M. Chloupek
Title: General Counsel

[Signature Page to Time-Based Restricted Stock Award]

THE UNDERSIGNED PARTICIPANT ACKNOWLEDGES RECEIPT OF THIS RESTRICTED STOCK GRANT NOTICE, THE RESTRICTED STOCK AGREEMENT AND THE PLAN, AND, AS AN EXPRESS CONDITION TO THE GRANT OF SHARES OF RESTRICTED STOCK HEREUNDER, AGREES TO BE BOUND BY THE TERMS OF THIS RESTRICTED STOCK GRANT NOTICE, THE RESTRICTED STOCK AGREEMENT AND THE PLAN.¹

Participant

________________________________

¹  To the extent that the Company has established, either itself or through a third-party plan administrator, the ability to accept this award electronically, such acceptance shall constitute the Participant’s signature hereto.

[Signature Page to Time-Based Restricted Stock Award]

RESTRICTED STOCK AGREEMENTUNDER THECorePoint Lodging Inc.
2018 OMNIBUS INCENTIVE PLAN

Pursuant to the Restricted Stock Grant Notice (the “Grant Notice”) delivered to the Participant (as defined in the Grant Notice), and subject to the terms of this Restricted Stock Agreement (this “Restricted Stock Agreement”) and the CorePoint Lodging Inc. 2018 Omnibus Incentive Plan, as it may be amended and restated from time to time (the “Plan”), CorePoint Lodging Inc. (the “Company”) and the Participant agree as follows.  Capitalized terms not otherwise defined herein shall have the same meaning as set forth in the Plan.

1. Grant of Shares of Restricted Stock.  Subject to the terms and conditions set forth herein and in the Plan, the Company hereby grants to the Participant the number of shares of Restricted Stock provided in the Grant Notice.  The Company may make one or more additional grants of shares of Restricted Stock to the Participant under this Restricted Stock Agreement by providing the Participant with a new Grant Notice, which may also include any terms and conditions differing from this Restricted Stock Agreement to the extent provided therein.  The Company reserves all rights with respect to the granting of additional shares of Restricted Stock hereunder and makes no implied promise to grant additional shares of Restricted Stock.

2. Vesting.  Subject to the conditions contained herein and in the Plan, the shares of Restricted Stock shall vest and the restrictions on such shares of Restricted Stock shall lapse as provided in the Grant Notice.  With respect to any share of Restricted Stock, the period of time that such share of Restricted Stock remains subject to vesting shall be its Restricted Period.

3. Issuance of Shares of Restricted Stock.  The provisions of Section 8(d)(i) of the Plan are incorporated herein by reference and made a part hereof.

4. Treatment of Shares of Restricted Stock Upon Termination.  Unless otherwise provided by the Committee, in the event of the Participant’s Termination for any reason:  

(a) all vesting with respect to the Restricted Stock shall cease (after taking into account any vesting of Restricted Stock as set forth in the Grant Notice); and

(b) the unvested shares of Restricted Stock shall be forfeited to the Company by the Participant for no consideration as of the date of such Termination.

5. Company; Participant.

(a) The term “Company” as used in this Restricted Stock Agreement with reference to employment shall include the Company and its subsidiaries.

(b) Whenever the word “Participant” is used in any provision of this Restricted Stock Agreement under circumstances where the provision should logically be construed to apply to the executors, the administrators, or the person or persons to whom the shares of Restricted Stock may be transferred by will or by the laws of descent and distribution, the word “Participant” shall be deemed to include such person or persons.

6. Non-Transferability.  The shares of Restricted Stock are not transferable by the Participant except to Permitted Transferees in accordance with Section 14(b) of the Plan.  Except as

otherwise provided herein, no assignment or transfer of the shares of Restricted Stock, or of the rights represented thereby, whether voluntary or involuntary, by operation of law or otherwise, shall vest in the assignee or transferee any interest or right herein whatsoever, but immediately upon such assignment or transfer the shares of Restricted Stock shall terminate and become of no further effect.

7. Rights as Stockholder; Legend. The provisions of Sections 8(b) and 8(e) of the Plan are incorporated herein by reference and made a part hereof.

8. Tax Withholding.  The provisions of Section 14(d) of the Plan are incorporated herein by reference and made a part hereof.

9. Notice.  Every notice or other communication relating to this Restricted Stock Agreement between the Company and the Participant shall be in writing, and shall be mailed to or delivered to the party for whom it is intended at such address as may from time to time be designated by such party in a notice mailed or delivered to the other party as herein provided; provided that, unless and until some other address be so designated, all notices or communications by the Participant to the Company shall be mailed or delivered to the Company at its principal executive office, to the attention of the Company General Counsel, and all notices or communications by the Company to the Participant may be given to the Participant personally or may be mailed to the Participant at the Participant’s last known address, as reflected in the Company’s records.  Notwithstanding the above, all notices and communications between the Participant and any third-party plan administrator shall be mailed, delivered, transmitted or sent in accordance with the procedures established by such third-party plan administrator and communicated to the Participant from time to time.

10. No Right to Continued Service.  This Restricted Stock Agreement does not confer upon the Participant any right to continue as an employee or service provider to the Company.

11. Binding Effect.  This Restricted Stock Agreement shall be binding upon the heirs, executors, administrators and successors of the parties hereto.

12. Waiver and Amendments.  Except as otherwise set forth in Section 13 of the Plan, any waiver, alteration, amendment or modification of any of the terms of this Restricted Stock Agreement shall be valid only if made in writing and signed by the parties hereto; provided, however, that any such waiver, alteration, amendment or modification is consented to on the Company’s behalf by the Committee.  No waiver by either of the parties hereto of their rights hereunder shall be deemed to constitute a waiver with respect to any subsequent occurrences or transactions hereunder unless such waiver specifically states that it is to be construed as a continuing waiver.

13. Governing Law.  This Restricted Stock Agreement shall be construed and interpreted in accordance with the laws of the State of Maryland, without regard to the principles of conflicts of law thereof.  Notwithstanding anything contained in this Restricted Stock Agreement, the Grant Notice or the Plan to the contrary, if any suit or claim is instituted by the Participant or the Company relating to this Restricted Stock Agreement, the Grant Notice or the Plan, the Participant hereby submits to the exclusive jurisdiction of and venue in the courts of Maryland.

14. Plan.  The terms and provisions of the Plan are incorporated herein by reference.  In the event of a conflict or inconsistency between the terms and provisions of the Plan and the provisions of this Restricted Stock Agreement, the Plan shall govern and control.

15. Substitute Award.  The Restricted Stock granted to the Participant as provided in the Grant Notice shall be considered a Substitute Award for purposes of the Plan.  

EX-10.18

Exhibit 10.18

FORM OF
RESTRICTED STOCK GRANT NOTICE
UNDER THE
cOREpOINT LODGING Inc.
2018 OMNIBUS INCENTIVE PLAN
(Time-Based Vesting Award)

CorePoint Lodging Inc. (the “Company”), pursuant to its 2018 Omnibus Incentive Plan, as it may be amended and restated from time to time (the “Plan”), hereby grants to the Participant set forth below the number of shares of Restricted Stock set forth below in full satisfaction of the grants required to be made pursuant to the terms of the Employee Matters Agreement between the Company and La Quinta Holdings Inc., dated January 17, 2018 (the “EMA”) in respect of certain LQ PSUs (as defined in the EMA) granted to such Participant under the Amended and Restated La Quinta Holdings Inc. 2014 Omnibus Incentive Plan.  The shares of Restricted Stock are subject to all of the terms and conditions as set forth herein, in the Restricted Stock Agreement (attached hereto or previously provided to the Participant in connection with a prior grant), and in the Plan, all of which are incorporated herein in their entirety. For purposes of the Plan, the Restricted Stock granted hereunder shall be considered a Substitute Award.  Capitalized terms not otherwise defined herein shall have the meaning set forth in the Plan.

Participant: [Insert Participant Name]

Number of Shares of

Restricted Stock: [Insert No. of Shares of Restricted Stock Granted]

Vesting Schedule: Provided the Participant has not undergone a Termination at the time of the vesting date (or event):

• all of the Restricted Stock will vest on [●];

provided, however, that in the event that (i) prior to a Change in Control, the Participant undergoes a Termination by the Service Recipient without Cause, by such Participant for Good Reason or as a result of such Participant’s death or Disability, or (ii) a Change in Control occurs prior to the vesting date, such Participant shall fully vest in such Participant’s Restricted Stock.

Additional Terms:

• You must notify us immediately if you are making an Internal Revenue Code Section 83(b) Election, and you must send us a copy of the same.

• For purposes hereof, prior to the finding of the existence of Cause under clauses (ii)(A), (B) and (D) of the definition thereof, the Company must provide (x) the Participant written notice setting forth the alleged Cause event and (y) such Participant not less than ten (10) days to fully cure such alleged Cause event.

2

• “Good Reason” shall, in the case of any Participant who is party to an agreement between the Participant and the Company that contains a definition of “Good Reason”, mean and refer to the definition set forth in such agreement, and in the case of any other Participant, “Good Reason” shall mean: (A) a diminution in Participant’s base salary or material diminution in Participant’s annual bonus opportunity; (B) any material diminution in Participant’s authority, duties or responsibilities; or (C) the relocation of Participant’s principal work location by more than fifty (50) miles; provided that none of these events shall constitute Good Reason unless the Company fails to cure such event within thirty (30) days after receipt from Participant of written notice of the event which constitutes Good Reason; provided, further, that “Good Reason” shall cease to exist for an event on the sixtieth (60^th) day following the later of its occurrence or Participant’s knowledge thereof, unless Participant has given the Company’s written notice thereof prior to such date.  Notwithstanding anything herein to the contrary, for purposes of the last proviso of the immediately foregoing sentence, a series of related events shall be deemed to have occurred on the date upon which the last event in such series of related events has occurred.

• To the extent the Participant is party to an agreement between the Participant and the Company that contains language governing the treatment of equity in connection with a Change in Control, this Restricted Stock Grant Notice shall govern and control regarding the treatment of such Participant’s equity in connection with such Change in Control.

***

Corepoint lodging Inc.

________________________________
By: Mark M. Chloupek
Title: General Counsel

[Signature Page to Time-Based Restricted Stock Award]

THE UNDERSIGNED PARTICIPANT ACKNOWLEDGES RECEIPT OF THIS RESTRICTED STOCK GRANT NOTICE, THE RESTRICTED STOCK AGREEMENT AND THE PLAN, AND, AS AN EXPRESS CONDITION TO THE GRANT OF SHARES OF RESTRICTED STOCK HEREUNDER, AGREES TO BE BOUND BY THE TERMS OF THIS RESTRICTED STOCK GRANT NOTICE, THE RESTRICTED STOCK AGREEMENT AND THE PLAN.¹

Participant

________________________________

¹  To the extent that the Company has established, either itself or through a third-party plan administrator, the ability to accept this award electronically, such acceptance shall constitute the Participant’s signature hereto.

[Signature Page to Time-Based Restricted Stock Award]

RESTRICTED STOCK AGREEMENT
UNDER THECorePoint Lodging Inc.
2018 OMNIBUS INCENTIVE PLAN

Pursuant to the Restricted Stock Grant Notice (the “Grant Notice”) delivered to the Participant (as defined in the Grant Notice), and subject to the terms of this Restricted Stock Agreement (this “Restricted Stock Agreement”) and the CorePoint Lodging Inc. 2018 Omnibus Incentive Plan, as it may be amended and restated from time to time (the “Plan”), CorePoint Lodging Inc. (the “Company”) and the Participant agree as follows.  Capitalized terms not otherwise defined herein shall have the same meaning as set forth in the Plan.

1. Grant of Shares of Restricted Stock.  Subject to the terms and conditions set forth herein and in the Plan, the Company hereby grants to the Participant the number of shares of Restricted Stock provided in the Grant Notice.  The Company may make one or more additional grants of shares of Restricted Stock to the Participant under this Restricted Stock Agreement by providing the Participant with a new Grant Notice, which may also include any terms and conditions differing from this Restricted Stock Agreement to the extent provided therein.  The Company reserves all rights with respect to the granting of additional shares of Restricted Stock hereunder and makes no implied promise to grant additional shares of Restricted Stock.

2. Vesting.  Subject to the conditions contained herein and in the Plan, the shares of Restricted Stock shall vest and the restrictions on such shares of Restricted Stock shall lapse as provided in the Grant Notice.  With respect to any share of Restricted Stock, the period of time that such share of Restricted Stock remains subject to vesting shall be its Restricted Period.

3. Issuance of Shares of Restricted Stock.  The provisions of Section 8(d)(i) of the Plan are incorporated herein by reference and made a part hereof.

4. Treatment of Shares of Restricted Stock Upon Termination.  Unless otherwise provided by the Committee, in the event of the Participant’s Termination for any reason:  

(a) all vesting with respect to the Restricted Stock shall cease (after taking into account any vesting of Restricted Stock as set forth in the Grant Notice); and

(b) the unvested shares of Restricted Stock shall be forfeited to the Company by the Participant for no consideration as of the date of such Termination.

5. Company; Participant.

(a) The term “Company” as used in this Restricted Stock Agreement with reference to employment shall include the Company and its subsidiaries.

(b) Whenever the word “Participant” is used in any provision of this Restricted Stock Agreement under circumstances where the provision should logically be construed to apply to the executors, the administrators, or the person or persons to whom the shares of Restricted Stock may be transferred by will or by the laws of descent and distribution, the word “Participant” shall be deemed to include such person or persons.

6. Non-Transferability.  The shares of Restricted Stock are not transferable by the Participant except to Permitted Transferees in accordance with Section 14(b) of the Plan.  Except as

otherwise provided herein, no assignment or transfer of the shares of Restricted Stock, or of the rights represented thereby, whether voluntary or involuntary, by operation of law or otherwise, shall vest in the assignee or transferee any interest or right herein whatsoever, but immediately upon such assignment or transfer the shares of Restricted Stock shall terminate and become of no further effect.

7. Rights as Stockholder; Legend. The provisions of Sections 8(b) and 8(e) of the Plan are incorporated herein by reference and made a part hereof.

8. Tax Withholding.  The provisions of Section 14(d) of the Plan are incorporated herein by reference and made a part hereof.

9. Notice.  Every notice or other communication relating to this Restricted Stock Agreement between the Company and the Participant shall be in writing, and shall be mailed to or delivered to the party for whom it is intended at such address as may from time to time be designated by such party in a notice mailed or delivered to the other party as herein provided; provided that, unless and until some other address be so designated, all notices or communications by the Participant to the Company shall be mailed or delivered to the Company at its principal executive office, to the attention of the Company General Counsel, and all notices or communications by the Company to the Participant may be given to the Participant personally or may be mailed to the Participant at the Participant’s last known address, as reflected in the Company’s records.  Notwithstanding the above, all notices and communications between the Participant and any third-party plan administrator shall be mailed, delivered, transmitted or sent in accordance with the procedures established by such third-party plan administrator and communicated to the Participant from time to time.

10. No Right to Continued Service.  This Restricted Stock Agreement does not confer upon the Participant any right to continue as an employee or service provider to the Company.

11. Binding Effect.  This Restricted Stock Agreement shall be binding upon the heirs, executors, administrators and successors of the parties hereto.

12. Waiver and Amendments.  Except as otherwise set forth in Section 13 of the Plan, any waiver, alteration, amendment or modification of any of the terms of this Restricted Stock Agreement shall be valid only if made in writing and signed by the parties hereto; provided, however, that any such waiver, alteration, amendment or modification is consented to on the Company’s behalf by the Committee.  No waiver by either of the parties hereto of their rights hereunder shall be deemed to constitute a waiver with respect to any subsequent occurrences or transactions hereunder unless such waiver specifically states that it is to be construed as a continuing waiver.

13. Governing Law.  This Restricted Stock Agreement shall be construed and interpreted in accordance with the laws of the State of Maryland, without regard to the principles of conflicts of law thereof.  Notwithstanding anything contained in this Restricted Stock Agreement, the Grant Notice or the Plan to the contrary, if any suit or claim is instituted by the Participant or the Company relating to this Restricted Stock Agreement, the Grant Notice or the Plan, the Participant hereby submits to the exclusive jurisdiction of and venue in the courts of Maryland.

14. Plan.  The terms and provisions of the Plan are incorporated herein by reference.  In the event of a conflict or inconsistency between the terms and provisions of the Plan and the provisions of this Restricted Stock Agreement, the Plan shall govern and control.

15. Substitute Award.  The Restricted Stock granted to the Participant as provided in the Grant Notice shall be considered a Substitute Award for purposes of the Plan.  

EX-10.19

Exhibit 10.19

FORM OF
RESTRICTED STOCK GRANT NOTICE
UNDER THE
cOREpOINT LODGING Inc.
2018 OMNIBUS INCENTIVE PLAN
(Time-Based Vesting Award)

CorePoint Lodging Inc. (the “Company”), pursuant to its 2018 Omnibus Incentive Plan, as it may be amended and restated from time to time (the “Plan”), hereby grants to the Participant set forth below the number of shares of Restricted Stock set forth below in full satisfaction of the grants required to be made pursuant to the terms of the Employee Matters Agreement between the Company and La Quinta Holdings Inc., dated January 17, 2018 (the “EMA”) in respect of certain LQ RSAs (as defined in the EMA) granted to such Participant under the Amended and Restated La Quinta Holdings Inc. 2014 Omnibus Incentive Plan.  The shares of Restricted Stock are subject to all of the terms and conditions as set forth herein, in the Restricted Stock Agreement (attached hereto or previously provided to the Participant in connection with a prior grant), and in the Plan, all of which are incorporated herein in their entirety. For purposes of the Plan, the Restricted Stock granted hereunder shall be considered a Substitute Award.  Capitalized terms not otherwise defined herein shall have the meaning set forth in the Plan.

Participant: [Insert Participant Name]

Number of Shares of

Restricted Stock: [Insert No. of Shares of Restricted Stock Granted]

Vesting Schedule: Provided the Participant has not undergone a Termination at the time of the vesting date (or event), the Restricted Stock will vest on [●];

provided, however, that in the event (i) of a Change in Control or (ii) that such Participant undergoes a Termination by the Service Recipient without Cause, by such Participant for Good Reason, or as a result of such Participant’s death or Disability, such Participant shall fully vest in such Participant’s Restricted Stock.

Additional Terms:

• You must notify us immediately if you are making an Internal Revenue Code Section 83(b) Election, and you must send us a copy of the same.

• For purposes hereof, prior to the finding of the existence of Cause under clauses (ii)(A), (B) and (D) of the definition thereof, the Company must provide (x) the Participant written notice setting forth the alleged Cause event and (y) such Participant not less than ten (10) days to fully cure such alleged Cause event.

• “Good Reason” shall, in the case of any Participant who is party to an agreement between the Participant and the

2

Company that contains a definition of “Good Reason”, mean and refer to the definition set forth in such agreement, and in the case of any other Participant, “Good Reason” shall mean: (A) a diminution in Participant’s base salary or material diminution in Participant’s annual bonus opportunity; (B) any material diminution in Participant’s authority, duties or responsibilities; or (C) the relocation of Participant’s principal work location by more than fifty (50) miles; provided that none of these events shall constitute Good Reason unless the Company fails to cure such event within thirty (30) days after receipt from Participant of written notice of the event which constitutes Good Reason; provided, further, that “Good Reason” shall cease to exist for an event on the sixtieth (60^th) day following the later of its occurrence or Participant’s knowledge thereof, unless Participant has given the Company’s written notice thereof prior to such date.  Notwithstanding anything herein to the contrary, for purposes of the last proviso of the immediately foregoing sentence, a series of related events shall be deemed to have occurred on the date upon which the last event in such series of related events has occurred.

• To the extent the Participant is party to an agreement between the Participant and the Company that contains language governing the treatment of equity in connection with a Change in Control, this Restricted Stock Grant Notice shall govern and control regarding the treatment of such Participant’s equity in connection with such Change in Control.

***

Corepoint lodging Inc.

________________________________
By: Mark M. Chloupek
Title: General Counsel

[Signature Page to Time-Based Restricted Stock Award]

THE UNDERSIGNED PARTICIPANT ACKNOWLEDGES RECEIPT OF THIS RESTRICTED STOCK GRANT NOTICE, THE RESTRICTED STOCK AGREEMENT AND THE PLAN, AND, AS AN EXPRESS CONDITION TO THE GRANT OF SHARES OF RESTRICTED STOCK HEREUNDER, AGREES TO BE BOUND BY THE TERMS OF THIS RESTRICTED STOCK GRANT NOTICE, THE RESTRICTED STOCK AGREEMENT AND THE PLAN.¹

Participant

________________________________

¹  To the extent that the Company has established, either itself or through a third-party plan administrator, the ability to accept this award electronically, such acceptance shall constitute the Participant’s signature hereto.

[Signature Page to Time-Based Restricted Stock Award]

RESTRICTED STOCK AGREEMENT
UNDER THECorePoint Lodging Inc.
2018 OMNIBUS INCENTIVE PLAN

Pursuant to the Restricted Stock Grant Notice (the “Grant Notice”) delivered to the Participant (as defined in the Grant Notice), and subject to the terms of this Restricted Stock Agreement (this “Restricted Stock Agreement”) and the CorePoint Lodging Inc. 2018 Omnibus Incentive Plan, as it may be amended and restated from time to time (the “Plan”), CorePoint Lodging Inc. (the “Company”) and the Participant agree as follows.  Capitalized terms not otherwise defined herein shall have the same meaning as set forth in the Plan.

1. Grant of Shares of Restricted Stock.  Subject to the terms and conditions set forth herein and in the Plan, the Company hereby grants to the Participant the number of shares of Restricted Stock provided in the Grant Notice.  The Company may make one or more additional grants of shares of Restricted Stock to the Participant under this Restricted Stock Agreement by providing the Participant with a new Grant Notice, which may also include any terms and conditions differing from this Restricted Stock Agreement to the extent provided therein.  The Company reserves all rights with respect to the granting of additional shares of Restricted Stock hereunder and makes no implied promise to grant additional shares of Restricted Stock.

2. Vesting.  Subject to the conditions contained herein and in the Plan, the shares of Restricted Stock shall vest and the restrictions on such shares of Restricted Stock shall lapse as provided in the Grant Notice.  With respect to any share of Restricted Stock, the period of time that such share of Restricted Stock remains subject to vesting shall be its Restricted Period.

3. Issuance of Shares of Restricted Stock.  The provisions of Section 8(d)(i) of the Plan are incorporated herein by reference and made a part hereof.

4. Treatment of Shares of Restricted Stock Upon Termination.  Unless otherwise provided by the Committee, in the event of the Participant’s Termination for any reason:  

(a) all vesting with respect to the Restricted Stock shall cease (after taking into account any vesting of Restricted Stock as set forth in the Grant Notice); and

(b) the unvested shares of Restricted Stock shall be forfeited to the Company by the Participant for no consideration as of the date of such Termination.

5. Company; Participant.

(a) The term “Company” as used in this Restricted Stock Agreement with reference to employment shall include the Company and its subsidiaries.

(b) Whenever the word “Participant” is used in any provision of this Restricted Stock Agreement under circumstances where the provision should logically be construed to apply to the executors, the administrators, or the person or persons to whom the shares of Restricted Stock may be transferred by will or by the laws of descent and distribution, the word “Participant” shall be deemed to include such person or persons.

6. Non-Transferability.  The shares of Restricted Stock are not transferable by the Participant except to Permitted Transferees in accordance with Section 14(b) of the Plan.  Except as

otherwise provided herein, no assignment or transfer of the shares of Restricted Stock, or of the rights represented thereby, whether voluntary or involuntary, by operation of law or otherwise, shall vest in the assignee or transferee any interest or right herein whatsoever, but immediately upon such assignment or transfer the shares of Restricted Stock shall terminate and become of no further effect.

7. Rights as Stockholder; Legend. The provisions of Sections 8(b) and 8(e) of the Plan are incorporated herein by reference and made a part hereof.

8. Tax Withholding.  The provisions of Section 14(d) of the Plan are incorporated herein by reference and made a part hereof.

9. Notice.  Every notice or other communication relating to this Restricted Stock Agreement between the Company and the Participant shall be in writing, and shall be mailed to or delivered to the party for whom it is intended at such address as may from time to time be designated by such party in a notice mailed or delivered to the other party as herein provided; provided that, unless and until some other address be so designated, all notices or communications by the Participant to the Company shall be mailed or delivered to the Company at its principal executive office, to the attention of the Company General Counsel, and all notices or communications by the Company to the Participant may be given to the Participant personally or may be mailed to the Participant at the Participant’s last known address, as reflected in the Company’s records.  Notwithstanding the above, all notices and communications between the Participant and any third-party plan administrator shall be mailed, delivered, transmitted or sent in accordance with the procedures established by such third-party plan administrator and communicated to the Participant from time to time.

10. No Right to Continued Service.  This Restricted Stock Agreement does not confer upon the Participant any right to continue as an employee or service provider to the Company.

11. Binding Effect.  This Restricted Stock Agreement shall be binding upon the heirs, executors, administrators and successors of the parties hereto.

12. Waiver and Amendments.  Except as otherwise set forth in Section 13 of the Plan, any waiver, alteration, amendment or modification of any of the terms of this Restricted Stock Agreement shall be valid only if made in writing and signed by the parties hereto; provided, however, that any such waiver, alteration, amendment or modification is consented to on the Company’s behalf by the Committee.  No waiver by either of the parties hereto of their rights hereunder shall be deemed to constitute a waiver with respect to any subsequent occurrences or transactions hereunder unless such waiver specifically states that it is to be construed as a continuing waiver.

13. Governing Law.  This Restricted Stock Agreement shall be construed and interpreted in accordance with the laws of the State of Maryland, without regard to the principles of conflicts of law thereof.  Notwithstanding anything contained in this Restricted Stock Agreement, the Grant Notice or the Plan to the contrary, if any suit or claim is instituted by the Participant or the Company relating to this Restricted Stock Agreement, the Grant Notice or the Plan, the Participant hereby submits to the exclusive jurisdiction of and venue in the courts of Maryland.

14. Plan.  The terms and provisions of the Plan are incorporated herein by reference.  In the event of a conflict or inconsistency between the terms and provisions of the Plan and the provisions of this Restricted Stock Agreement, the Plan shall govern and control.

15. Substitute Award.  The Restricted Stock granted to the Participant as provided in the Grant Notice shall be considered a Substitute Award for purposes of the Plan.

EX-10.20

Exhibit 10.20

FORM OF
RESTRICTED STOCK UNIT GRANT NOTICE
UNDER THE
COREPOINT LODGING Inc.
2018 OMNIBUS INCENTIVE PLAN
(Non-Employee Directors)

CorePoint Lodging Inc. (the “Company”), pursuant to the CorePoint Lodging Inc. 2018 Omnibus Incentive Plan (the “Plan”), hereby grants to the Participant set forth below the number of Restricted Stock Units set forth below in full satisfaction of the grants required to be made pursuant to the terms of the Employee Matters Agreement between the Company and La Quinta Holdings Inc., dated January 17, 2018 (the “EMA”) in respect of certain LQ RSUs granted to such Participant under the Amended and Restated La Quinta Holdings Inc. 2014 Omnibus Incentive Plan.  The Restricted Stock Units are subject to all of the terms and conditions as set forth herein, in the Restricted Stock Unit Agreement (attached hereto or previously provided to the Participant in connection with a prior grant), and in the Plan, all of which are incorporated herein in their entirety.  For purposes of the Plan, the Restricted Stock Units granted hereunder shall be considered a Substitute Award.  Capitalized terms not otherwise defined herein shall have the meaning set forth in the Plan.

Participant: [Insert Participant’s Name]

Number of Restricted Stock Units [Insert Number]

Vesting Schedule: Provided the Participant has not undergone a Termination at the time of each applicable vesting date (or event):

• [One third (1/3) of the Restricted Stock Units will vest on [●];

• One third (1/3) of the Restricted Stock Units will vest on [●]; and

• One third (1/3) of the Restricted Stock Units will vest on [●];]

• [One half (1/2) of the Restricted Stock Units will vest on [●]; and

• One half (1/2) of the Restricted Stock Units will vest on [●];]

• [All of the Restricted Stock Units will vest on [●];]

provided, however, that in the event that (i) the Participant undergoes a Termination as a result of such Participant’s death or Disability, or (ii) a Change in Control occurs prior to the applicable vesting date, such Participant shall fully vest in such Participant’s Restricted Stock Units.

***

THE UNDERSIGNED PARTICIPANT ACKNOWLEDGES RECEIPT OF THIS RESTRICTED STOCK UNIT GRANT NOTICE, THE RESTRICTED STOCK UNIT AGREEMENT AND THE PLAN, AND, AS AN EXPRESS CONDITION TO THE GRANT OF RESTRICTED STOCK UNITS HEREUNDER, AGREES TO BE BOUND BY THE TERMS OF THIS RESTRICTED STOCK UNIT GRANT NOTICE, THE RESTRICTED STOCK UNIT AGREEMENT AND THE PLAN.¹

COREPOINT LODGING Inc.Participant

________________________________________________________________
By: Mark M. Chloupek[  ]
Title: General Counsel

¹  To the extent that the Company has established, either itself or through a third-party plan administrator, the ability to accept this award electronically, such acceptance shall constitute the Participant’s signature hereto.

[Signature Page to Restricted Stock Unit Award]

RESTRICTED STOCK UNIT AGREEMENT
UNDER THECOREPOINT LODGING Inc.
2018 OMNIBUS INCENTIVE PLAN

Pursuant to the Restricted Stock Unit Grant Notice (the “Grant Notice”) delivered to the Participant (as defined in the Grant Notice), and subject to the terms of this Restricted Stock Unit Agreement (this “Restricted Stock Unit Agreement”) and the CorePoint Lodging Inc. 2018 Omnibus Incentive Plan, as it may be amended and restated from time to time (the “Plan”), CorePoint Lodging Inc. (the “Company”) and the Participant agree as follows.  Capitalized terms not otherwise defined herein shall have the same meaning as set forth in the Plan.

1.Grant of Restricted Stock Units.  Subject to the terms and conditions set forth herein and in the Plan, the Company hereby grants to the Participant the number of Restricted Stock Units provided in the Grant Notice (with each Restricted Stock Unit representing an unfunded, unsecured right to receive one share of Common Stock).  The Company may make one or more additional grants of Restricted Stock Units to the Participant under this Restricted Stock Unit Agreement by providing the Participant with a new Grant Notice, which may also include any terms and conditions differing from this Restricted Stock Unit Agreement to the extent provided therein.  The Company reserves all rights with respect to the granting of additional Restricted Stock Units hereunder and makes no implied promise to grant additional Restricted Stock Units.

2.Vesting.  Subject to the conditions contained herein and the Plan, the Restricted Stock Units shall vest as provided in the Grant Notice.  Notwithstanding such vesting, the Restricted Period applicable to any Restricted Stock Unit shall extend beyond vesting through the date of the Participant’s Termination; provided, however, that if such Termination does not constitute a “separation from service” within the meaning of Section 409A of the Code, the Restricted Period shall extend through the date of such Participant’s “separation from service”.

3.Dividend Equivalents.  The Restricted Stock Units shall be entitled to be credited with dividend equivalent payments upon the payment by the Company of dividends on shares of Common Stock.  Such dividend equivalents will be provided in shares of Common Stock having a Fair Market Value equal to the amount of such applicable dividends, and shall be shall be payable at the same time as the Restricted Stock Units are settled in accordance with Section 4 below.  In the event that any Restricted Stock Unit is forfeited by its terms, the Participant shall have no right to dividend equivalent payments in respect of such forfeited Restricted Stock Units.

4.Settlement of Restricted Stock Units.  The provisions of Section 8(d)(ii) of the Plan are incorporated herein by reference and made a part hereof.

5.Treatment of Restricted Stock Units Upon Termination.  Unless otherwise provided by the Committee, in the event of the Participant’s Termination for any reason:

(a)all vesting with respect to the Restricted Stock Units shall cease (after taking into account any vesting of Restricted Stock Units as set forth in the Grant Notice); and

(b)the unvested Restricted Stock Units shall be forfeited to the Company by the Participant for no consideration as of the date of such Termination.

6.Company; Participant.

4

(a)The term “Company” as used in this Restricted Stock Unit Agreement with reference to employment or service shall include the Company and its subsidiaries.

(b)Whenever the word “Participant” is used in any provision of this Restricted Stock Unit Agreement under circumstances where the provision should logically be construed to apply to the executors, the administrators, or the person or persons to whom the Restricted Stock Units may be transferred by will or by the laws of descent and distribution, the word “Participant” shall be deemed to include such person or persons.

7.Non-Transferability.  The Restricted Stock Units are not transferable by the Participant except to Permitted Transferees in accordance with Section 14(b) of the Plan.  Except as otherwise provided herein, no assignment or transfer of the Restricted Stock Units, or of the rights represented thereby, whether voluntary or involuntary, by operation of law or otherwise, shall vest in the assignee or transferee any interest or right herein whatsoever, but immediately upon such assignment or transfer the Restricted Stock Units shall terminate and become of no further effect.

8.Rights as Stockholder.  The Participant or a permitted transferee of the Restricted Stock Units shall have no rights as a stockholder with respect to any share of Common Stock underlying a Restricted Stock Unit unless and until the Participant shall have become the holder of record or the beneficial owner of such Common Stock, and no adjustment shall be made for dividends or distributions or other rights in respect of such share of Common Stock for which the record date is prior to the date upon which the Participant shall become the holder of record or the beneficial owner thereof.

9.Tax Withholding. The provisions of Section 14(d) of the Plan are incorporated herein by reference and made a part hereof.

10.Notice.  Every notice or other communication relating to this Restricted Stock Unit Agreement between the Company and the Participant shall be in writing, and shall be mailed to or delivered to the party for whom it is intended at such address as may from time to time be designated by it in a notice mailed or delivered to the other party as herein provided; provided that, unless and until some other address be so designated, all notices or communications by the Participant to the Company shall be mailed or delivered to the Company at its principal executive office, to the attention of the Company General Counsel, and all notices or communications by the Company to the Participant may be given to the Participant personally or may be mailed to the Participant at the Participant’s last known address, as reflected in the Company’s records.  Notwithstanding the above, all notices and communications between the Participant and any third-party plan administrator shall be mailed, delivered, transmitted or sent in accordance with the procedures established by such third-party plan administrator and communicated to the Participant from time to time.

11.No Right to Continued Service.  This Restricted Stock Unit Agreement does not confer upon the Participant any right to continue as an employee or service provider to the Company.

12.Binding Effect.  This Restricted Stock Unit Agreement shall be binding upon the heirs, executors, administrators and successors of the parties hereto.

13.Waiver and Amendments.  Except as otherwise set forth in Section 13 of the Plan, any waiver, alteration, amendment or modification of any of the terms of this Restricted Stock Unit Agreement shall be valid only if made in writing and signed by the parties hereto; provided, however, that any such waiver, alteration, amendment or modification is consented to on the Company’s behalf by the Committee.  No waiver by either of the parties hereto of their rights hereunder shall be deemed to

5

constitute a waiver with respect to any subsequent occurrences or transactions hereunder unless such waiver specifically states that it is to be construed as a continuing waiver.

14.Governing Law.  This Restricted Stock Unit Agreement shall be construed and interpreted in accordance with the laws of the State of Maryland, without regard to the principles of conflicts of law thereof.  Notwithstanding anything contained in this Restricted Stock Unit Agreement, the Grant Notice or the Plan to the contrary, if any suit or claim is instituted by the Participant or the Company relating to this Restricted Stock Unit Agreement, the Grant Notice or the Plan, the Participant hereby submits to the exclusive jurisdiction of and venue in the courts of Maryland.

15.Plan.  The terms and provisions of the Plan are incorporated herein by reference.  In the event of a conflict or inconsistency between the terms and provisions of the Plan and the provisions of this Restricted Stock Unit Agreement, the Plan shall govern and control.

16.Section 409A.  It is intended that the Restricted Stock Units granted hereunder shall be compliant with Section 409A of the Code and shall be interpreted as such.

17.Substitute Award.  The Restricted Stock Units granted to the Participant as provided in the Grant Notice shall be considered a Substitute Award for purposes of the Plan.

EX-10.21

Exhibit 10.21

August 17, 2005

Mr. Kenneth Caplan

Managing Director, Vice President and Assistant Secretary Wyndham International, Inc.

1950 Stemmons Freeway

Suite 6001

Dallas, Texas 75207

Re: Protection of Severance Benefits under Executive Employment Agreement Dear Ken:

ThepurposeofthisletteristoconfirmouragreementregardingtheprotectionofseverancebenefitsundertheExecutiveEmployment Agreement dated as of August 20, 2003 (the “Employment Agreement”) between myself and Wyndham International, Inc., the surviving corporationinitsmergerwithWindHotelsAcquisitionInc.,anaffiliateofTheBlackstoneGroup(“Wyndham”).

Theundersignedparties(the“parties”)agreethatthefirstsentenceinParagraph1oftheEmploymentAgreementshallbedeletedinits entiretyandshallbereplacedwiththefollowing:

“ThetermofthisAgreementshallextendfromtheEffectiveDateuntilthethirdanniversaryoftheEffectiveDate;provided,however,that thetermofthisAgreementshallautomaticallybeextendedforoneadditionalyearonthethirdanniversaryoftheEffectiveDateandeach anniversarythereafter,unless,notlessthanninety(90)dayspriortoeachsuchdate,eitherpartyshallhavegivennoticetotheotherthatit does not wish to extend thisAgreement.”

All capitalized terms in this letter shall have the same meaning as the defined terms in the Employment Agreement. Except as otherwise amendedbythisletteragreement,theEmploymentAgreementshallremaininfullforceandeffectinaccordancewithitsterms.Theprovisionsof Paragraphs9,10,and13oftheEmploymentAgreementareherebyincorporatedbyreferenceherein.Bysigningbelowthepartiesherebyagreeto the terms of this letteragreement.

WYNDHAMINTERNATIONAL,INC.EXECUTIVE

/s/WilliamStein/s/ MarkChloupek

WilliamSteinMarkChloupek

Date:8/29/05Date:8/29/05

AMENDED AND RESTATED EXECUTIVE EMPLOYMENT AGREEMENT

ThisAMENDEDANDRESTATEDEXECUTIVEEMPLOYMENTAGREEMENT(“Agreement”)ismadeasofthe20thdayofAugust,2003, betweenWyndhamInternational,Inc.,aDelawarecorporation(the“Company”),andMarkChloupek(“Executive”),effectiveasofAugust1,2003 (the “EffectiveDate”).

WHEREAS,ExecutiveandtheCompanypreviouslyenteredintoanExecutiveEmploymentAgreement,effectiveasofDecember4,2000,as amendedfromtimetotime(the“PriorAgreement”),pursuanttowhichExecutiveservedasaVicePresidentoftheCompanyandExecutivewas grantedcertainoptionstopurchaseacertainnumberofsharesofclassAcommonstockoftheCompany;

WHEREAS,theCompanynowdesirestoemployExecutiveasSeniorVicePresidentoftheCompanyandinconnectiontherewithdesiresto amendandrestatethePriorAgreement,asprovidedinthisAgreement,andtosupersedethePriorAgreementwiththisAgreement;

WHEREAS,ExecutiveisagreeabletoassumingthenewdutiesofthisnewpositionandisagreeabletoamendingandrestatingthePrior AgreementandsupersedingthePriorAgreementwiththisAgreement;

WHEREAS,asanadditionalinducementtoExecutivetoenterintothisAgreement,theCompanyshall,asoftheEffectiveDate,grant ExecutiveanoptiontopurchaseacertainnumberofadditionalsharesofClassAcommonstockoftheCompanyassetforthintheagreement attachedheretoasExhibitA(the“Option”);and

WHEREAS, Executive is desirous of committing to serve the Company on the terms herein provided.

NOW,THEREFORE,inconsiderationofthemutualcovenantsandagreementshereincontainedandothergoodandvaluableconsideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree that as of the Effective Date they shall enter into this Agreement which provides asfollows:

1.Employment. The term of this Agreement shall extend from the Effective Date until the third anniversary of the Effective Date; provided, however,thatthetermofthisAgreementshallautomaticallybeextendedforoneadditionalyearonthethirdanniversaryoftheEffectiveDateand each anniversary thereafter unless, not less than ninety (90) days prior to each such date, either party shall have given notice to the other that it does not wish to extend this Agreement; provided, further, that if a Change in Control occurs during the original or extended term of this Agreement,thetermofthisAgreementshallcontinueineffectuntilthelateroftheendoftheinitialtermdescribedaboveortheendofthetwelfth

(12th)monthfollowingthemonthinwhichtheChangeinControloccurred.ThetermofthisAgreementshallbesubjecttoterminationasprovided inParagraph6andmaybereferredtohereinasthe“PeriodofEmployment.”

2.PositionandDuties.DuringthePeriodofEmployment,ExecutiveshallserveasaSeniorVicePresidentoftheCompany,shallhavesupervision and control over and responsibility for the day-to-day business and affairs of those functions and operations of the Company and shall have such other powers and duties as may from time to time be prescribed by the Chairman of the Board of the Company (the “Chairman”), the Chief ExecutiveOfficeroftheCompany(the“CEO”)orotherexecutiveauthorizedbytheChairmanorCEO,providedthatsuchdutiesareconsistentwith Executive’s position or other positions that he may hold from time to time. Executive shall devote his full working time and efforts to the business andaffairsoftheCompany.Notwithstandingtheforegoing,Executivemayserveonotherboardsofdirectors,withtheapprovaloftheChaimianor CEO, or engage in religious, charitable or other community activities as long as such services and activities are disclosed to the Chaimian or CEO anddonotmateriallyinterferewithExecutive’sperformanceofhisdutiestotheCompanyasprovidedinthisAgreement.

3.Compensation and RelatedMatters.

(a) Base Salary and Incentive Compensation. Executive’s initial annual base salary (“Base Salary”) shall be $220,000. Executive’s Base Salaryshallberedeterminedatleastthirty(30) daysbeforeeachannualcompensationdeterminationdateestablishedbytheCompanyduringthe PeriodofEmploymentinanamounttobefixedbytheBoardofDirectorsoftheCompanyoracommitteethereoforadulyauthorizedofficer(the “Board”).TheBaseSalary,asredetermined,maybereferredtohereinas“AdjustedBaseSalary.”TheBaseSalaryorAdjustedBaseSalaryshall bepayableinsubstantiallyequalbi-weeklyinstallmentsandshallinnowaylimitorreducetheobligationsoftheCompanyhereunder.Inaddition to Base Salary or Adjusted Base Salary, Executive shall be eligible during the Period of Employment to receive cash incentive compensation as determined by the Board from time to time (the “Incentive Compensation”), and shall be eligible to participate in such incentive compensation plansastheBoardshalldeterminefromtimetotimeforemployeesofthesamestatuswithinthehierarchyoftheCompany.

“Pro Rata Incentive Compensation” shall be paid to Executive if Executive’s employment is terminated by reason of Executive’s death or disability, as provided in Subparagraphs 6(a) and 6(b), if Executive’s employment is terminated by the Executive for Good Reason, as provided in Subparagraph 6(e), or if Executive’s employment is terminated by the Company without Cause, as provided in Subparagraph 6(d). Pro Rata IncentiveCompensationequalstheIncentiveCompensationforthefiscalyearofterminationmultipliedbyafraction,thenumeratorofwhichisthe numberofdaysinsuchfiscalyearthroughDateofTerminationandthedenominatorofwhichis365.

If, for the purpose of calculating Incentive Compensation or Pro Rata Incentive Compensation, the Incentive Compensation cannot be determined by the time required to be paid, the Company shall make a good faith estimate of the pro rata amount based on an amount Executive would have earned had he continued employment for the entire fiscal year; provided, however, that where the Date of Termination occurs during thefirstsixmonthsofanyfiscalyear,theProRataIncentiveCompensationpaidtoExecutiveifExecutive’semploymentisterminatedbyreasonof Executive’sdeathordisability,bytheExecutiveforGoodReason,orby

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theCompanywithoutCauseshallnotexceedfiftypercent(50%)ofthemaximumIncentiveCompensationwhichcouldhavebeenpaidtoExecutive inthefiscalyearimmediatelyprecedingthefiscalyearoftermination.

(b) Expenses.Executiveshallbeentitledtoreceivepromptreimbursementforallreasonableexpensesincurredbyhim(inaccordancewith the policies and procedures then in effect and established by the Company for its senior executive officers) in performing services hereunder duringthePeriodofEmployment,providedthatExecutiveproperlyaccountsthereforinaccordancewithCompanypolicy.

(c) OtherBenefits.DuringthePeriodofEmployment,Executiveshallbeentitledtocontinuetoparticipateinorreceivebenefitsunderallof the Company’s Employee Benefit Plans in effect on the date hereof, or under plans or arrangements that provide Executive with at least substantially equivalent benefits to those provided under such Employee Benefit Plans. As used herein, “Employee Benefit Plans” include, withoutlimitation,eachpensionandretirementplan;supplementalpension,retirementanddeferredcompensationplan;savingsandprofit-sharing plan; stock ownership plan; stock purchase plan; stock option plan; life insurance plan; medical insurance plan; disability plan; and health and accidentplanorarrangementestablishedandmaintainedbytheCompanyonthedatehereofforemployeesofthesamestatuswithinthehierarchy of the Company. To the extent that the scope or nature of benefits described in this section are determined under the policies of the Company based in whole or in part on the seniority or tenure of an employee’s service, Executive shall be deemed to have a tenure with the Company equal to the actual time of Executive’s service with Company. During the Period of Employment, Executive shall be entitled to participate in or receive benefits under any employee benefit plan or arrangement which may, in the future, be made available by the Company to its executives and key management employees, subject to and on a basis consistent with the terms, conditions and overall administration of such plan or arrangement. Any payments or benefits payable to Executive under a plan or arrangement referred to in this Subparagraph 3(c) in respect of any calendar year duringwhichExecutiveisemployedbytheCompanyforlessthanthewholeofsuchyearshall,unlessotherwiseprovidedintheapplicableplanor arrangement,beproratedinaccordancewiththenumberofdaysinsuchcalendaryearduringwhichheissoemployed.Shouldanysuch

paymentsorbenefitsaccrueonafiscal(ratherthancalendar)year,thentheprorationintheprecedingsentenceshallbeonthebasisofafiscal year rather than calendaryear.

(d) Vacations.ExecutiveshallbeentitledtothenumberofpaidvacationdaysineachcalendaryeardeterminedbytheCompanyfromtimeto time for executives at the same level as Executive. Executive shall also be entitled to all paid holidays given by the Company to its executives. To the extent that the scope or nature of benefits described in this section are determined under the policies of the Company based in whole or in part on the seniority or tenure of an employee’s service, Executive shall be deemed to have a tenure with the Company equal to the actual time of Executive’s service with theCompany.

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4. UnauthorizedDisclosure.

(a) Confidential Information. Executive acknowledges that in the course of his employment with the Company (and, if applicable, its predecessors),hehasbeenallowedtobecome,andwillcontinuetobeallowedtobecome,acquaintedwiththebusinessaffairs,information,trade secrets, and other matters of the Company and its subsidiaries which are of a proprietary or confidential nature, including but not limited to the operations, business opportunities, price and cost information, finance, customer information, business plans, various sales techniques, manuals, letters, notebooks, procedures, reports, products, processes, services, and other confidential information and knowledge (collectively the “Confidential Information”) concerning the business of the Company, its predecessors and their respective subsidiaries. The Company agrees to provide on an ongoing basis such Confidential Information as the Company deems necessary or desirable to aid Executive in the performance of his duties. Executive understands and acknowledges that such Confidential Information is confidential, and he agrees not to disclose such Confidential Information to anyone outside the Company except to the extent that (i) Executive deems such disclosure or use reasonably necessary or appropriate in connection with performing his duties on behalf of the Company, (ii) Executive is required by order of a court of competentjurisdiction(bysubpoenaorsimilarprocess)todiscloseordiscussanyConfidentialInformation,providedthatinsuchcase,Executive shall promptly inform the Company of such event, shall cooperate with the Company in attempting to obtain a protective order or to otherwise restrictsuchdisclosure,andshallonlydiscloseConfidentialInformationtotheminimumextentnecessarytocomplywithanysuchcourtorder;

(iii)suchConfidentialInformationbecomesgenerallyknowntoandavailableforusebythehotelandhospitalityindustry(the“HotelIndustry”), other than as a result of any action or inaction by Executive; or (iv) such information has been rightfully received by a member of the Hotel Industry or has been published in a form generally available to the Hotel Industry prior to the date Executive proposes to disclose or use such information. Executive further agrees that he will not during employment and/or at any time thereafter use such Confidential Information in competing, directly or indirectly, with the Company or any of its subsidiaries. At such time as Executive shall cease to be employed by the Company,hewillimmediatelyturnovertotheCompanyallConfidentialInformation,includingpapers,documents,writings,electronicallystored infotination,otherproperty,andallcopiesofthemprovidedtoorcreatedbyhimduringthecourseofhisemploymentwiththeCompany.

(b) Heirs,successors,andlegalrepresentatives.TheforegoingprovisionsofthisParagraph4shallbebindinguponExecutive’sheirs, successors,andlegalrepresentatives.TheprovisionsofthisParagraph4shallsurvivetheterminationofthisAgreementforanyreason.

(c) Definition of Subsidiary. For purposes of this Paragraph 4 and for purposes of Paragraph 5 (Covenant Not to Compete) below, “subsidiary” of the Company means any corporation, partnership, joint venture, limited liability company or other entity of which (i) at least a majority of the securities or other interests having by their terms voting power to elect a majority of the board of directors or others performing similarfunctionsforsuchentityisdirectlyorindirectlybeneficiallyownedbytheCompany(eitheraloneorthroughortogetherwithoneormore ofitssubsidiaries),or(ii) theCompanyoranysubsidiaryoftheCompanyisageneralpartnerormanager.

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5. CovenantNottoCompete.InconsiderationfortheOption,theCompany’spromisetoprovideConfidentialInformationassetforthin Paragraph4above,andforExecutive’semploymentbytheCompanyunderthetermsprovidedinthisAgreement,andasameanstoaidinthe performance and enforcement of the terms of and preserve the rights of the Company pursuant to the Unauthorized Disclosure provisions of Paragraph 4, Executive agrees asfollows:

(a) during the term of Executive’s employment with the Company and for a period of eighteen (18) months thereafter, regardless of the reasonforterminationofemployment,Executivewillnot,directlyorindirectly,asanowner,director,principal,agent,officer,employee,partner, consultant,servant,orotherwise,carryon,operate,manage,control,orbecomeinvolvedinanymannerwithanybusiness,operation,corporation, partnership, association, agency, or other person or entity which is in the business of owning, operating, managing or granting franchise rights with respect to hotels, motels or other lodging facilities in any area or territory in which the Company or any of its subsidiaries conducts operations; provided, however, that the foregoing shall not prohibit Executive from owning up to one percent (1%) of the outstanding stock of a publicly held company engaged in the hospitality business. Notwithstanding the foregoing, after Executive’s employment with the Company has terminated, upon receiving written permission by the Board, Executive shall be permitted to engage in such activities with respect to any other hotel, motel or lodging facility that would be immaterial to the operations of the Company and its subsidiaries in the area or territory in question. Immateriality,forpurposesoftheforegoingsentence,shallbedeterminedinthesolediscretionoftheBoardingoodfaith.

(b) during the term of Executive’s employment with the Company and for a period of eighteen (18) months thereafter, regardless of the reasonfortelininationofemployment,Executivewillnot,directlyorindirectly,eitherforhimselforforanyotherbusiness,operation,corporation, partnership, association, agency, or other person or entity, call upon, compete for, solicit, divert, or take away, or attempt to divert or take away anyofthecustomers(including,withoutlimitation,anyhotelowner,lessororlessee,assetmanager,trusteeorconsumerwithwhomtheCompany oranyofitssubsidiariesfromtimetotime(i)hasanexistingagreementorbusinessrelationship;(ii)hashadanagreementorbusinessrelationship withinthetwo-yearperiodprecedingtheExecutive’slastdayofemploymentwiththeCompany;or(iii)hasincludedasaprospectinitsapplicable pipeline) or vendors of the Company or any of its subsidiaries in any of the areas or territories in which the Company or any of its subsidiaries conductsoperationsifsuchactionhastheintentoreffectofinterferingwiththeCompany’soranyofitssubsidiaries’relationshipwiththe

vendor or customer.

(c) duringthetermofExecutive’semploymentwiththeCompanyandforaperiodofeighteen(18)monthsthereafter,regardlessofthereason forterminationofemployment,ExecutivewillnotdirectlyorindirectlysolicitorinduceanycurrentorprospectiveemployeeoftheCompanyorany of its subsidiaries (including, without limitation, any current or prospective employee of the Company or any of its subsidiaries within the six- month period preceding Executive’s last day of employment with the Company or within the 18-month period of this covenant) to accept employment with Executive or with any business, operation, corporation, partnership, association, agency, or other person or entity with which Executive maybe

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associated, and Executive will not employ or cause any business, operation, corporation, partnership, association, agency, or other person or entitywithwhichExecutivemaybeassociatedtoemployanycurrentorprospectiveemployeeoftheCompanyoranyofitssubsidiarieswithout providingtheCompanywithten(10)days’priorwrittennoticeofsuchproposedemployment.

(d) Executive agrees and acknowledges that the restrictions contained in this noncompetition covenant are reasonable in scope of activity, duration and geographical area and are necessary to protect the Company’s business interests and Confidential Information after the Effective DateofthisAgreement.Ifanyprovisionofthisnoncompetitioncovenantasappliedtoanypartyortoanycircumstanceisadjudgedbyacourtto beinvalidorunenforceable,thesamewillinnowayaffectanyothercircumstanceorthevalidityorenforceabilityofthisAgreement.Ifanysuch provision, or any part thereof, is held to be unenforceable because of the duration of such provision or the scope of activity or area covered thereby, the parties agree that the court making such determination shall have the power to reduce the duration and/or area and/or scope of activity of such provision, and/or to delete specific words or phrases, and in its reduced form, such provision shall then be enforceable and shall beenforced.ThepartiesagreeandacknowledgethatthebreachofthisnoncompetitioncovenantwillcauseirreparabledamagetotheCompany, and upon breach of any provision of this noncompetition covenant, the Company shall be entitled to injunctive relief, specific performance, or other equitable relief; provided, however, that this shall in no way limit any other remedies which the Company may have (including, without limitation, the right to seek monetarydamages).

(e) ShouldExecutiveviolatetheprovisionsofthisParagraph,theninadditiontoallotherrightsandremediesavailabletotheCompanyat laworinequity,thedurationofthiscovenantshallautomaticallybeextendedfortheperiodoftimefromwhichExecutivebegansuchviolation until he permanently ceases suchviolation.

6. Termination.Executive’semploymenthereundermaybeterminatedwithoutanybreachofthisAgreementunderthefollowing circumstances:

(a) Death. Executive’s employment hereunder shall terminate upon hisdeath.

(b) Disability.If,asaresultofExecutive’sincapacityduetophysicalormentalillness,Executiveshallhavebeenabsentfromhisduties hereunderonafull-timebasisforonehundredeighty(180)calendardaysintheaggregateinanytwelve(12)monthperiod,theCompanymay terminate Executive’s employmenthereunder.

(c) Termination by Company For Cause. At any time during the Period of Employment, the Company may terminate Executive’s employmenthereunderforCauseifsuchterminationisapprovedbytheCEO.ForpurposesofthisAgreement“Cause”shallmean:(A)conductby Executive constituting a material act of willful misconduct in connection with the performance of his duties, including, without limitation, misappropriationoffundsorpropertyoftheCompanyoranyofitsaffiliatesotherthantheoccasional,customaryanddeminimisuseofCompany propertyforpersonalpurposes;(B)criminalorcivilconvictionofExecutive,apleaofnolocontenderebyExecutiveorconductbyExecutivethat would reasonably be expectedto

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result in material injury to the reputation of the Company if he were retained in his position with the Company, including, without limitation, convictionofafelonyinvolvingmoralturpitude;(C)continued,willfulanddeliberatenon-performancebyExecutiveofhisdutieshereunder(other thanbyreasonofExecutive’sphysicalormentalillness,incapacityordisability)andsuchnon-performancehascontinuedformorethanthirty

(30) days following written notice of such non-performance from the Board; (D) a breach by Executive of any of the provisions contained in Paragraphs4and5ofthisAgreement;or(E)aviolationbyExecutiveoftheCompany’semploymentpoliciesandsuchviolationhascontinuedfor morethanthirty(30)daysfollowingwrittennoticeofsuchviolationfromtheBoard.

(d) Termination Without Cause. At any time during the Period of Employment, the Company may terminate Executive’s employment hereunder without Cause if such termination is approved by the CEO. Any termination by the Company of Executive’s employment under this AgreementwhichdoesnotconstituteaterminationforCauseunderSubparagraph6(c)orresultfromthedeathordisabilityoftheExecutiveunder Subparagraph6(a)or(b) shallbedeemedaterminationwithoutCause.IftheCompanyprovidesnoticetotheExecutiveunderParagraph1thatit doesnotwishtoextendthePeriodofEmployment,suchactionshallbedeemedaterminationwithoutCause.

(e) Termination by Executive. At any time during the Period of Employment, Executive may terminate his employment hereunder for any reason,includingbutnotlimitedtoGoodReason.IfExecutiveprovidesnoticetotheCompanyunderParagraph1thathedoesnotwishtoextend the Period of Employment, such action shall be deemed a voluntary termination by Executive and one without Good Reason. For purposes of this Agreement, “Good Reason” shall mean that Executive has complied with the “Good Reason Process” (hereinafter defined) following the occurrence of any of the following events: (A) a substantial diminution or other substantive adverse change, not consented to by Executive, in the nature or scope of Executive’s responsibilities, authorities, powers, functions or duties, other than a change in Executive’s position or reporting relationship;(B)anyremoval,duringthePeriodofEmployment,fromExecutiveofhistitleofSeniorVicePresident;(C)aninvoluntaryreductionin Executive’s Base Salary or Adjusted Base Salary or involuntary reduction in cash incentive compensation plan (but not reduction in incentive compensation appropriate for level of performance) except for across-the-board salary reductions similarly affecting all or substantially all management employees; (D) a breach by the Company of any of its other material obligations under this Agreement and the failure of the Companytocuresuchbreachwithinthirty(30)daysafterwrittennoticethereofbyExecutive;or(E)theinvoluntaryrelocationoftheCompany’s officesatwhichExecutiveisprincipallyemployedortheinvoluntaryrelocationoftheofficesofExecutive’sprimaryworkgrouptoalocationmore thanthirty(30)milesfromsuchoffices,ortherequirementbytheCompanyforExecutivetobebasedanywhereotherthantheCompany’soffices atsuchlocationorinDallas,Texasonanextendedbasis,exceptforrequiredtravelontheCompany’sbusinesstoanextentsubstantially

consistent with Executive’s business travel obligations. “Good Reason Process” shall mean that (i) the Executive reasonably determines in good faiththata“GoodReason”eventhasoccurred;(ii)ExecutivenotifiestheCompanyinwriting(the“GoodReasonNotice”)oftheoccurrenceofthe GoodReasonevent;(iii)foraperiod(the“GoodReasonProcessPeriod”)consistingofnotlessthanthirty(30)daysiftheGoodReasonNoticeis deliveredtotheCompanywithin18monthsaftertheoccurrenceofthe

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firsteventconstitutingaChangeinControl(asdefinedinSubparagraph8(c))andnotlessthanninety(90)daysinallotherinstances,Executive cooperates in good faith with the Company’s efforts to modify Executive’s employment situation in a manner acceptable to Executive and the Company;and(iv) notwithstandingsuchefforts,oneormoreoftheGoodReasoneventscontinuetoexistandhasnotbeenmodifiedinamanner acceptabletoExecutive.IftheCompanycurestheGoodReasoneventduringtheapplicableGoodReasonProcessPeriod,GoodReasonshallbe deemed not to haveoccurred.

(f) Notice of Termination. Except for termination as specified in Subparagraph 6(a), any termination of Executive’s employment by the CompanyoranysuchterminationbyExecutiveshallbecommunicatedbywrittenNoticeofTerminationtotheotherpartyhereto.Forpurposesof this Agreement, a “Notice of Termination” shall mean a notice which shall indicate the specific termination provision in this Agreement relied upon.

(g) DateofTermination.“DateofTermination” shallmean:(A)ifExecutive’s employmentisterminatedbyhisdeath,thedateofhisdeath;

(B)ifExecutive’semploymentisterminatedonaccountofdisabilityunderSubparagraph6(b)orbytheCompanyforCauseunderSubparagraph6 (c),thedateonwhichNoticeofTerminationisgiven;(C)ifExecutive’semploymentisterminatedbytheCompanyunderSubparagraph6(d),thirty

(30)daysafterthedateonwhichaNoticeofTerminationisgiven;and(D)ifExecutive’semploymentisterminatedbyExecutiveunder Subparagraph6(e),thirty(30)daysafterthedateonwhichaNoticeofTerminationisgiven.

7.Compensation Upon Termination or DuringDisability.

(a) If Executive’s employment terminates by reason of his death, the Company shall, within ninety (90) days of death, pay in a lump sum amount to such person as Executive shall designate in a notice filed with the Company or, if no such person is designated, to Executive’s estate, Executive’saccruedandunpaidBaseSalaryor,ifapplicable,hisAdjustedBaseSalary,tothedateofhisdeath,plusaccruedandunpaidIncentive Compensation,ifany,forthefiscalyearprecedingterminationandProRataIncentiveCompensation,ifany,underSubparagraph3(a).Foraperiod of one (1) year following the Date of Termination, the Company shall pay such health insurance premiums as may be necessary to allow Executive’s spouse and dependents to receive health insurance coverage substantially similar to coverage they received prior to the Date of Termination. In addition to the foregoing, any payments to which Executive’s spouse, beneficiaries, or estate may be entitled under any employee benefitplanshallalsobepaidinaccordancewiththetermsofsuchplanorarrangement.Suchpayments,intheaggregate,shallfullydischargethe Company’s obligationshereunder.

(b) DuringanyperiodthatExecutivefailstoperformhisdutieshereunderasaresultofincapacityduetophysicalormentalillness,Executive shall continue to receive his accrued and unpaid Base Salary or, if applicable, his Adjusted Base Salary and Incentive Compensation payments, if any,underSubparagraph3(a),untilExecutive’semploymentisterminatedduetodisabilityinaccordancewithSubparagraph6(b)oruntilExecutive terminates his employment in accordance with Subparagraph 6(e), whichever first occurs, at which point Executive shall then receive any accrued andunpaidIncentiveCompensation,ifany,forthefiscalyearpreceding

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terminationandProRataIncentiveCompensation,ifany,underSubparagraph3(a).Foraperiodofone(1)yearfollowingtheDateofTermination, the Company shall pay such health insurance premiums as may be necessary to allow Executive, Executive’s spouse and dependents to receive healthinsurancecoveragesubstantiallysimilartocoveragetheyreceivedpriortotheDateofTermination.Uponterminationduetodeathpriorto theterminationfirsttooccurasspecifiedinthefirstsentenceofthisSubparagraph7(b),Subparagraph7(a)shallapply.

(c) IfExecutive’semploymentisterminatedbyExecutiveotherthanforGoodReasonasprovidedinSubparagraph6(e),thentheCompany shall,throughtheDateofTermination,payExecutivehisaccruedandunpaidBaseSalaryor,ifapplicable,hisAdjustedBaseSalaryattheratein effect at the time Notice of Termination is given. Thereafter, the Company shall have no further obligations to Executive except as otherwise expresslyprovidedunderthisAgreement,providedanysuchterminationshallnotadverselyaffectoralterExecutive’srightsunderanyemployee benefit plan of the Company in which Executive, at the Date of Termination, has a vested interest, unless otherwise provided in such employee benefitplanoranyagreementorotherinstrumentattendantthereto.

(d) IfExecutiveterminateshisemploymentforGoodReasonasprovidedinSubparagraph6(e)orifExecutive’semploymentisterminatedby the Company without Cause as provided in Subparagraph 6(d), then the Company shall, through the Date of Termination, pay Executive his accrued and unpaid Base Salary or, if applicable, his Adjusted Base Salary at the rate in effect at the time Notice of Termination is given and accrued and unpaid Incentive Compensation, if any, for the fiscal year preceding teimination and Pro Rata Incentive Compensation, if any, under Subparagraph3(a).Inaddition,subjecttosigningbyExecutiveofageneralreleaseofclaimsinaformandmannersatisfactorytotheCompany,

(i) the Company shall continue to provide payments to Executive in an amount equal to one and one-half (11/2) times the sum of Executive’sAverageBaseSalaryandhisAverageIncentiveCompensation,payableovereighteen(18)monthsaftertheDateofTermination (the “Severance Amount”). The Severance Amount shall be paid out in substantially equal bi-weekly installments, in arrears; provided, however, that in the event Executive commences any employment with an employer other than the Company during the twelve (12) month period ending on the first anniversary of the Date of Termination, the Company shall be entitled to set-off against the remaining Severance Amount fifty percent (50%) of the amount of any cash compensation received by Executive from the new employer during such period; provided, further, that in the event Executive commences any employment with, or is employed by, any employer other than the Company duringthesix(6)monthperiodfollowingthefirstanniversaryoftheDateofTermination,theCompanyshallbeentitledtoset-offagainstthe remainingSeveranceAmounttwenty-fivepercent(25%)oftheamountofanycashcompensationreceivedbyExecutivefromsuchemployer during such period. From time to time, Executive may be asked to certify to the Company that he has not accepted employment with a new employer (including, without limitation, contract and consulting agreements). For purposes of this Agreement, “Average Base Salary” shall meantheaverageoftheannualBaseSalaryor,ifapplicable,AdjustedBaseSalaryreceivedbyExecutiveforeachofthethree(3)immediately precedingfiscalyearsorsuchfewernumberofcompletefiscal

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years as Executive may have been employed by the Company; provided, however, that if Executive has not been employed by the Company forafullfiscalyear,then“AverageBaseSalary”shallmeantheactualamountofBaseSalarypaidtoExecutivefortheimmediatelypreceding fiscalyear,whichamountshallbeannualizedasifExecutivehadbeenemployedbytheCompanyfortheentireimmediatelyprecedingfiscal year, and if Executive was not employed by the Company during the immediately preceding fiscal year, then “Average Base Salary” shall meantheactualamountofBaseSalarypaidtoExecutiveforthefiscalyearinwhichterminationoccurs,whichamountshallbeannualizedas if Executive had been employed for such entire fiscal year. For purposes of this Agreement, “Average Incentive Compensation” shall mean the average of the annual Incentive Compensation under Subparagraph 3(a) received by Executive for the three (3) immediately preceding fiscalyearsorsuchfewernumberofcompletefiscalyearsasExecutivemayhavebeenemployedbytheCompany;provided,however,thatif Executive has not been employed by the Company for a full fiscal year, then “Average Incentive Compensation” shall mean the actual amount of Incentive Compensation received by Executive for the immediately preceding fiscal year, which amount shall be annualized as if Executivehadbeenemployedfortheentireimmediatelyprecedingfiscalyear,andifExecutivewasnotemployedbytheCompanyduringthe immediately preceding fiscal year, “Average Incentive Compensation” shall be zero. In no event shall “Average Incentive Compensation” include any sign-on bonus, retention bonus or any other special bonus. Notwithstanding the foregoing, if Executive breaches any of the provisionscontainedinParagraphs4and5ofthisAgreement,allpaymentsoftheSeveranceAmountshallimmediatelycease.

Notwithstandingtheforegoing,intheeventExecutiveterminateshisemploymentforGoodReasonasprovidedinSubparagraph6(e),he shallbeentitledtotheSeveranceAmountonlyifheprovidestheGoodReasonNoticeprovidedforinSubparagraph6(e)withinthirty

(30) days after the occurrence of the event or events which constitute such Good Reason as specified in clauses (A), (B), (C), (D) and (E) of Subparagraph6(e)andheprovidestheNoticeofTerminationprovidedforinSubparagraph6(f)withinfive(5)daysaftertheexpirationofthe Good Reason Process Period;and

(ii) in addition to any other benefits to which Executive may be entitled in accordance with the Company’s then existing severance policies,theCompanyshall,foraperiodofone(1)yearcommencingontheDateofTermination,paysuchhealthinsurancepremiumsasmay benecessarytoallowExecutive,Executive’sspouseanddependentstocontinuetoreceivehealthinsurancecoveragesubstantiallysimilar

to the coverage they received prior to his termination of employment.

(e) If Executive’s employment is terminated by the Company for Cause as provided in Subparagraph 6(c), then the Company shall, through the Date of Termination, pay Executive his accrued and unpaid Base Salary or, if applicable, his Adjusted Base Salary at the rate in effect at the timeNoticeofTerminationisgiven.Thereafter,theCompanyshallhavenofurtherobligationstoExecutiveexceptasotherwiseexpresslyprovided under this Agreement, provided any such termination shall not adversely affect or alter Executive’s rights under any employee benefit plan of the Company in which Executive, at the Date of Termination, has a vested interest, unless otherwise provided in such employee benefit plan or any agreement or other instrument attendantthereto.

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(f) NothingcontainedintheforegoingSubparagraphs7(a)through7(e)shallbeconstruedsoastoaffectExecutive’srightsorthe Company’sobligationsrelatingtoagreementsorbenefitswhichareunrelatedtoterminationofemployment.

8.Change in Control Payment. The provisions of this Paragraph 8 set forth certain terms of an agreement reached between Executive and the Company regarding Executive’s rights and obligations upon the occurrence of a Change in Control of the Company. These provisions are intendedtoassureandencourageinadvanceExecutive’scontinuedattentionanddedicationtohisassigneddutiesandhisobjectivityduringthe pendency and after the occurrence of any such event. These provisions shall apply in lieu of, and expressly supersede, the provisions of Subparagraph7(d)(i)regardingseverancepayuponaterminationofemployment,ifsuchterminationofemploymentoccurswithintwelve

(12)months after the occurrence of the first event constituting a Change of Control; provided that such first event occurs during the Period of Employment.TheprovisionsofSubparagraph8(a)shallterminateandbeofnofurtherforceoreffectbeginningtwelve(12)monthsafterthe occurrence of a Change inControl.

(a) Change inControl.

(i) If within twelve (12) months after the occurrence of the first event constituting a Change in Control, Executive’s employment is terminated by the Company without Cause as provided in Subparagraph 6(d) or Executive terminates his employment for Good Reason as provided in Subparagraph 6(e), then the Company shall pay Executive the Severance Amount as provided in Subparagraph 7(d)(i) in substantiallyequalbi-weeklyinstallments,inarrears,overeighteen(18)months;provided,however,thatintheeventExecutivecommences anyemploymentwithanemployerotherthantheCompanyduringsucheighteen(18) monthperiod,theCompanyshallnotbeentitledtoany right of set-off against the Severance Amount for any cash compensation received by the Executive from the new employer during such period.Notwithstandingtheforegoing,iftheExecutivebreachesanyoftheprovisionscontainedinParagraphs4and5ofthisAgreement,

all payments of the Severance Amount shall immediately cease; and

(ii) Withinfifteen(15)daysafterExecutivebecomesentitledtoreceivetheSeveranceAmountunder(i)above,theCompanyshallplace funds in an amount equal to the estimated Severance Amount in escrow, pursuant to arrangements that are mutually acceptable to the CompanyandExecutive(the“EscrowArrangement”).TheEscrowArrangementshallbemaintaineduntilthefinalinstallmentpaymentofthe Severance Amount has beenmade;

(iii) Notwithstanding anything to the contrary in any applicable option agreement or stock-based award, in the event of a Change in ControlduringthePeriodofEmployment,anyunvestedportionsofanystockoptionorotherstock-basedawardshallfullyvestandbecome exercisableonehundredeighty(180)daysafterthedateoftheChangeinControl(providedExecutiveisemployedbytheCompanyonsuch date)or,ifearlier,onthedatefollowingtheChangeinControltheExecutive’semploymentwiththe

11

Company is terminated by the Company without Cause or by the Executive for Good Reason. In the event of such termination, Executive shallhavethreehundredsixty(360) daysfollowingtheDateofTerminationtoexerciseallhisstockoptions;provided,however,innoevent mayExecutiveexerciseanystockoptiononoraftertheExpirationDateofsuchoption(asdefinedintheapplicableoptionagreement).

Executive shall also be entitled to any other rights and benefits with respect to stock-related awards, to the extent and upon the terms providedintheemployeestockoptionorincentiveplanoranyagreementorotherinstrumentattendanttheretopursuanttowhichsuch options or awards were granted;and

(iv) TheCompanyshall,foraperiodofone(1)yearcommencingontheDateofTermination,paysuchhealthinsurancepremiumsas may be necessary to allow Executive, Executive’s spouse and dependents to continue to receive health insurance coverage substantially similartothecoveragetheyreceivedpriortohisterminationofemployment.

(b) Gross UpPayment

(i) Excess Parachute Payment. If in connection with the first event constituting a Change in Control of the Company Executive incurs the tax (the “Excise Tax”) imposed by Section 4999 of the Internal Revenue Code of 1986 (the “Code”) on “excess parachute payments” withinthemeaningofSection280G(b)(1)oftheCode,theCompanywillpaytoExecutive,withrespecttothepayments(oreventstreatedas payments under such Section 4999) that give rise to such Excise Tax (an “Excise Taxable Payment”), an additional amount (a “Gross Up Payment”)thatisequaltothelesserof(A)anamountsuchthatthenetamountretainedbyExecutivefromallsuchExciseTaxablePayments, after deduction of any Excise Tax on all Excise Taxable Payments and any federal, state and local income taxes and employment taxes (together with penalties and interest) as well as the Excise Tax upon the payment or payments provided for by this clause (A) of this Subparagraph8(b)(i),willbeequaltotheaggregateamountofallsuchExciseTaxablePayments(excludingallamountspayablepursuantto this clause (A)) or (B) an amount equal to 1.25 multiplied by Executive’s Base Salary or Adjusted Base Salary, as applicable, in effect immediatelypriortothedateoftheChangeinControl.

(ii) Applicable Rates. For purposes of determining the amount of the Gross Up Payment, Executive will be deemed to pay federal income taxes at the highest marginal rate of federal income taxation in the calendar year in which the Gross Up Payment is to be made and stateandlocalincometaxesatthehighestmarginalratesoftaxationinthestateandlocalityofExecutive’sprimaryresidenceforthecalendar year in which the Gross Up Payment is to be made, net of the maximum reduction in federal income taxes that could be obtained from deduction of such state and localtaxes.

(iii) Time for Payment. The Company will pay the estimated amount of the Gross Up Payment in cash to Executive at such time or timeswhentheExciseTaxisdue.ExecutiveandtheCompanyandtheirrespectivetaxadvisorsagreetoconferandreasonablycooperatein thedeterminationoftheactualamountoftheGrossUpPayment.

12

Without limiting the foregoing, Executive shall, if requested by the Company, cooperate in a valuation of Executive’s obligations under paragraph5ofthisAgreementbyavaluationfirmselectedandpaidforbytheCompany.Further,ExecutiveandtheCompanyagreetomake such adjustments to the estimated amount of the Gross Up Payment as may be necessary to equal the actual amount of the Gross Up Payment, which in the case of Executive will refer to refunds of prior overpayments and in the case of the Company will refer to makeup of priorunderpayments.-

(c)Definitions.ForpurposesofthisParagraph8,thefollowingtermsshallhavethefollowingmeanings: “ChangeinControl”shallmeananyofthefollowing:

(a) the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (the “AcquiringPerson”),otherthantheCompany,oranyofitsSubsidiariesoranyInvestororExcludedGroup,ofbeneficialownership(within the meaning of Rule 13d-3 promulgated under the Exchange Act) of thirty-five percent (35%) or more of the combined voting power or economicinterestsofthethenoutstandingvotingsecuritiesoftheCompanyentitledtovotegenerallyintheelectionofdirectors;provided, however,thatanytransferfromanyInvestororExcludedGroupwillnotresultinaChangeinControlifsuchtransferwaspartofaseriesof related transactions the effect of which, absent the transfer to such Acquiring Person by the Investor or Excluded Group, would not have resulted in the acquisition by such Acquiring Person of thirty-five percent (35%) or more of the combined voting power or economic interestsofthethenoutstandingvotingsecurities;or

(b) during any period of twelve (12) consecutive months after the Issuance Date, the individuals who at the beginning of any such 12- month period constituted a majority of the Class A Directors and Class C Directors (the “Incumbent Non-Investor Majority”) cease for any reason to constitute at least a majority of such Class A Directors and Class C Directors; provided that (i) any individual becoming a director whose election, or nomination for election by the Company’s stockholders, was approved by a vote of the stockholders having the right to designate such director and (ii) any director whose election to the Board or whose nomination for election by the stockholders of the Company was approved by the requisite vote of directors entitled to vote on such election or nomination in accordance with the Restated Certificate of Incorporation of the Company, shall, in each such case, be considered as though such individual were a member of the Incumbent Non-Investor Majority, but excluding, as a member of the Incumbent Non-Investor Majority, any such individual whose initial assumptionofofficeisinconnectionwithanactualorthreatenedelectioncontestrelatingtotheelectionofthedirectorsoftheCompany(as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) and further excluding any person who is an affiliateorassociateofanAcquiringPersonhavingorproposingtoacquirebeneficialownershipoftwenty-fivepercent(25%) ormoreofthe combinedvotingpowerofthethenoutstandingvotingsecuritiesoftheCompanyentitledtovotegenerallyintheelectionofdirectors;or

13

(c) the approval by the stockholders of the Company of a reorganization, merger or consolidation, in each case, with respect to which all or substantially all of the individuals and entities who were the respective beneficial owners of the voting securities of the Company immediatelypriortosuchreorganization,mergerorconsolidationdonot,followingsuchreorganization,mergerorconsolidation,beneficially own, directly or indirectly, more than fifty-seven and one-half percent (57.5%) of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors of the Company resulting from such reorganization, merger or consolidation; or

(d) thesaleorotherdispositionofassetsrepresentingfiftypercent(50%) ormoreoftheassetsoftheCompanyinonetransactionor series of relatedtransactions.

Alldefinedtermsusedinthedefinitionof“ChangeinControl”shallhavethesamemeaningassetforthintheCertificateofDesignationof SeriesBConvertiblePreferredStockofWyndhamInternational,Inc.ineffectontheEffectiveDateofthisAgreement.

“Company” shall mean not only Wyndham International, Inc., but also its successors by merger or otherwise.

9.Notice. For purposes of this Agreement, notices and all other communications provided for in the Agreement shall be in writing and shall be deemedtohavebeendulygivenwhendeliveredormailedbyUnitedStatescertifiedmail,returnreceiptrequested,postageprepaid,addressedas follows:

if to the Executive:

At his home address as shown

in the Company’s personnel records; if to the Company:

Wyndham International, Inc.

1950 Stemmons Freeway

Suite 6001

Dallas, TX 75207

Attention: Executive Vice President, General Counsel

ortosuchotheraddressaseitherpartymayhavefurnishedtotheotherinwritinginaccordanceherewith,exceptthatnoticesofchangeof address shall be effective only uponreceipt.

10.Miscellaneous. No provisions of this Agreement may be modified, waived, or discharged unless such waiver, modification, or discharge is agreedtoinwritingandsignedbyExecutiveandsuchofficeroftheCompanyasmaybespecificallydesignatedbytheBoard.Nowaiverbyeither partyheretoof,orcompliancewith,anyconditionorprovisionofthisAgreementtobeperformedbysuchotherpartyshallbedeemedawaiverof similar ordissimilar

14

provisions or conditions at the same or at any prior or subsequent time. This Agreement, with its Exhibit A, constitutes the entire agreement between the parties with respect to the subject matter hereof. No agreements or representations, oral or otherwise, express or implied, unless specificallyreferredtoherein,withrespecttothesubjectmatterhereofhavebeenmadebyeitherpartywhicharenotsetforthexpresslyinthis AgreementandExhibitA.ThisAgreementsupersedesallprioragreementsbetweenthepartieswithrespecttoanyrelatedsubjectmatter.The validity,interpretation,construction,andperformanceofthisAgreementshallbegovernedbythelawsoftheStateofTexas(withoutregardto principles of conflicts oflaws).

11.Validity. The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of anyotherprovisionofthisAgreement,whichshallremaininfullforceandeffect.TheinvalidportionofthisAgreement,ifany,shallbemodified byanycourthavingjurisdictiontotheextentnecessarytorendersuchportionenforceable.

12.Counterparts.ThisAgreementmaybeexecutedinseveralcounterparts,eachofwhichshallbedeemedtobeanoriginalbutallofwhich togetherwillconstituteoneandthesameinstrument.

13. Mediation and/or Arbitration; OtherDisputes.

(a) General Procedures. In the event of any dispute or controversy arising under or in connection with the terms of this Agreement, the parties shall first promptly try in good faith to settle such dispute or controversy by mediation under the Commercial Mediation Rules of the AmericanArbitrationAssociation(“AAA”)beforeresortingtoarbitration,provided,however,thatifthedisputeorcontroversyconcernswhether Executive is entitled to a payment under subparagraph 8(a) or 8(b) or the amount of any payment to which the Executive is entitled under subparagraph8(a)or8(b),theexpeditedproceduresinsubparagraph13(b)willapply.Intheeventsuchdisputeorcontroversyremainsunresolved in whole or in part for a period of thirty (30) days after it is submitted to mediation, the parties will settle any remaining dispute or controversy exclusivelybyarbitrationinDallas,TexasinaccordancewiththeCommercialArbitrationRulesoftheAAAthenineffect.Thepartiesheretoagree that any dispute relating to the terms of this Agreement or the performance by the parties of their respective obligations under the terms of this Agreement shall not in any event be subject to the AAA’s National Rules for the Resolution of Employment Disputes. Judgment may be entered on the arbitrator’s award in any court having jurisdiction. With respect to any dispute or controversy arising under or in connection with the terms ofthisAgreementafteraChangeinControl,alladministrationfeesandarbitrationfeesshallbepaidsolelybytheCompany.Eachpartyagreesto payitsownlegalfeesandexpensesincurredinconnectionwithmediationand/orarbitration.

Notwithstanding the above, the Company shall be entitled to seek a restraining order or injunction in any court of competent jurisdiction to prevent any continuation of any violation of paragraph 4 or 5 hereof. Should a dispute occur concerning Executive’s mental or physicalcapacityasdescribedinsubparagraph6(b),6(c)or7(b),adoctorselectedbyExecutiveandadoctorselectedbytheCompanyshallbe entitledtoexamineExecutive.IftheopinionoftheCompany’sdoctorandExecutive’sdoctorconflict,theCompany’sdoctorandExecutive’s doctorshalltogetheragreeuponathirddoctor,whoseopinionshallbebinding.

15

AnyamounttowhichExecutiveisentitledunderthisAgreement(includinganydisputedamount)whichisnotpaidwhendueshall bearinterestfromthedatedueuntilpaidatarateequaltothelesserofeighteenpercent(18%)perannumorthemaximumlawfulrate.

(b) Expedited Procedures. The following expedited procedures apply in the event of any dispute or controversy concerning whether Executive is entitled to a payment under subparagraph 8(a) or 8(b) or the amount of any payment to which Executive is entitled under subparagraph8(a)or8(b),andareintendedtosupplementthegeneralproceduresdetailedabove.Thepartiesshallfirstpromptlytryingoodfaith tosettlesuchdisputeorcontroversybyexpeditedmediationundertheCommercialMediationRulesoftheAAA,asmodifiedbythisAgreement, beforeresortingtoarbitration.Intheeventthatsuchdisputeorcontroversyremainsunresolvedinwholeorinpartforaperiodoffifteen(15) days aftereitherpartyfilesarequestforexpeditedmediationwiththeAAA,thepartieswillsettleanyremainingdisputeorcontroversyexclusivelyby expeditedarbitrationinDallas,TexasinaccordancewiththeExpeditedProceduresoftheCommercialArbitrationRulesoftheAAAthenineffect, asmodifiedbythisAgreement.Thepartiesagreethatthearbitrationhearingwillbeheldsixty(60)daysafterthefilingofademandforexpedited arbitration. The parties further agree that the following deadlines shall apply: (1) a party has fifteen (15) days following the conclusion of the mediation period to file an arbitration demand; (2) the opposing party then has seven (7) days to file an answering statement; (3) thereafter, the parties have thirty-five (35) days to conduct discovery, and (4) the parties have seven (7) days following the close of discovery to exchange copies of all exhibits that they intend to submit at the hearing. During the first five (5) days of the discovery period, and prior to either party startingdiscovery,thepartiesmustagreeuponthetypeofdiscoverythatwillbeconductedanduponadiscoveryschedule.Anydispute

regardingthetypeofdiscoveryorthediscoveryschedulemustberesolvedbythearbitratorduringadiscoveryconferenceconductedinperson oronthetelephonewithinthefirstfive(5)daysofthediscoveryperiod.Thepartiesagreethatthearbitratorshallhavefifteen(15)daysafterthe arbitrationhearingtoissueanaward.Theawardshallbewrittenandreasoned,ifrequestedbyoneoftheparties.

14.Third-Party Agreements and Rights. Executive represents to the Company that Executive’s execution of this Agreement, Executive’s employmentwiththeCompanyandtheperformanceofExecutive’sproposeddutiesfortheCompanywillnotviolateanyobligationsExecutive mayhavetoanyemployerorotherparty,andExecutivewillnotbringtothepremisesoftheCompanyanycopiesorothertangibleembodiments ofnon-publicinformationbelongingtoorobtainedfromanysuchpreviousemploymentorotherparty.

15.LitigationandRegulatoryCooperation.DuringandafterExecutive’semployment,ExecutiveshallreasonablycooperatewiththeCompanyin the defense or prosecution of any claims or actions now in existence or which may be brought in the future against or on behalf of the Company which relate to events or occurrences that transpired while Executive was employed by the Company; provided, however, that such cooperation shallnotmateriallyandadverselyaffectExecutiveorexposeExecutivetoanincreasedprobabilityofcivilorcriminal

16

litigation. Executive’s cooperation in connection with such claims or actions shall include, but not be limited to, being available to meet with counsel to prepare for discovery or trial and to act as a witness on behalf of the Company at mutually convenient times. During and after Executive’semployment,ExecutivealsoshallcooperatefullywiththeCompanyinconnectionwithanyinvestigationorreviewofanyfederal,state or local regulatory authority as any such investigation or review relates to events or occurrences that transpired while Executive was employed by the Company. The Company shall also provide Executive with compensation on an hourly basis (to be derived from the sum of his Base Salary or, if applicable, Adjusted Base Salary and Average Incentive Compensation) for requested litigation and regulatory cooperation that occurs after his termination of employment, and reimburse Executive for all costs and expenses incurred in connection with his performance under this Paragraph 15,including,butnotlimitedto,reasonableattorneys’feesandcosts.

16.GenderNeutral.Whereverusedherein,apronouninthemasculinegendershallbeconsideredasincludingthefemininegenderunlessthe context clearly indicatesotherwise.

[Signature Page Follows] 17

IN WITNESS WHEREOF, the parties have executed this Agreement effective on the date and year first above written.

WYNDHAM  INTERNATIONAL, INC.

By:	/s/MarkSolls
Its:	ExecutiveVicePresident&GeneralCounsel
	/s/ Mark Chloupek
	Mark Chloupek

18

EX-10.22

Exhibit 10.22

ASSUMPTION OF EMPLOYMENT AGREEMENT

ASSUMPTIONAGREEMENTdatedasofOctober31,2013(this“Assumption”)byLQMANAGEMENTL.L.C.,aDelawarelimited liability company (“LQManagement”).

BACKGROUND

Reference is made to that certain Amended and Restated Executive Employment Agreement dated as of August 20, 2003 by and betweenWyndhamInternational,Inc.(“Wyndham”)andMarkChloupek,assupplementedbythatcertainletterdatedApril17,2005(collectively, the “EmploymentAgreement”).

ASSUMPTION

LQ Management hereby assumes all of Wyndham’s duties and obligations with respect to the Employment Agreement.

LQManagementherebyacknowledgesthatWyndhamisreleasedfromalldutiesandobligationswithrespecttotheEmployment AgreementandhasnofurtherliabilityundertheEmploymentAgreement.

This Assumption shall be construed in accordance with and governed by the laws of the State of New York.

ThisAssumptionmaybeexecutedinoneormorecounterparts,eachofwhichwhensoexecutedanddeliveredshallbedeemedan original,butallofwhichtakentogethershallconstitutebutoneandthesameinstrument.

IN WITNESS WHEREOF, LQ Management has duly executed this instrument as of the day first above written.

LQ MANAGEMENT L.L.C.,

a Delaware limited liability company

By:BlackstoneRealEstateAcquisitionsIVL.L.C., aDelawarelimitedliabilitycompany,itsmanager

By:	/s/ WilliamJ.Stein
Name:	WilliamJ.Stein
Title:	Senior ManagingDirector

Acknowledged and Agreed to:

/s/ Mark Chloupek    

Mark Chloupek

[Signature Page to Assumption of Employment Agreement]

EX-31.1

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

I, Keith A. Cline, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2018 of CorePoint Lodging Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 14, 2018

/s/ Keith A. Cline

Keith A. Cline

President and Chief Executive Officer

(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, Daniel E. Swanstrom II, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2018 of CorePoint Lodging Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 14, 2018

/s/ Daniel E. Swanstrom II

Daniel E. Swanstrom II

Executive Vice President and Chief Financial Officer

(Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of CorePoint Lodging Inc. (the “Company”) on Form 10-Q for the quarterly period ended June 30, 2018 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Keith A. Cline, President, Chief Executive Officer and Director of the Company, do hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 14, 2018

/s/ Keith A. Cline

Keith A. Cline

President and Chief Executive Officer

(Principal Executive Officer)

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of CorePoint Lodging Inc. (the “Company”) on Form 10-Q for the quarterly period ended June 30, 2018 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Daniel E. Swanstrom II, Executive Vice President and Chief Financial Officer, do hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 14, 2018

/s/ Daniel E. Swanstrom II

Daniel E. Swanstrom II

Executive Vice President and Chief Financial Officer

(Principal Financial Officer)

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2018	Aug. 07, 2018
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q2
Trading Symbol	CPLG
Entity Registrant Name	COREPOINT LODGING INC.
Entity Central Index Key	0001707178
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		59,613,393

XML

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017
Real estate
Land	$ 738	$ 739
Buildings and improvements	2,772	2,706
Furniture, fixtures, and other equipment	385	363
Gross operating real estate	3,895	3,808
Less accumulated depreciation	(1,502)	(1,425)
Net operating real estate	2,393	2,383
Construction in progress	74	75
Total real estate, net	2,467	2,458
Cash and cash equivalents	80	141
Accounts receivable, net	49	42
Other assets	55	32
Assets from discontinued operations		280
Total Assets	2,651	2,953
Liabilities:
Debt, net	1,032	992
Mandatorily redeemable preferred shares	15
Accounts payable and accrued expenses	83	65
Other liabilities	8	9
Deferred tax liabilities		213
Liabilities from discontinued operations		846
Total Liabilities	1,138	2,125
Commitments and Contingencies
Equity:
Common Stock, $0.01 par value; 1,000,000,000 and 2,000,000,000 shares authorized at June 30, 2018 and December 31, 2017, respectively; 59,687,447 and 66,239,037 shares issued as of June 30, 2018 and December 31, 2017, respectively; and 59,576,383 and 58,672,998 shares outstanding as of June 30, 2018 and December 31, 2017, respectively	1	1
Additional paid-in-capital	973	1,181
Retained Earnings (accumulated deficit)	539	(144)
Treasury stock at cost, 111,064 shares at June 30, 2018 and 7,566,039 shares at December 31, 2017	(3)	(212)
Accumulated other comprehensive loss		(1)
Noncontrolling interests	3	3
Total Equity	1,513	828
Total Liabilities and Equity	$ 2,651	$ 2,953

XML

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Jun. 30, 2018	Dec. 31, 2017
Statement Of Financial Position [Abstract]
Preferred Stock, par value	$ 0.01	$ 0.01
Preferred Stock, shares authorized	50,000,000	100,000,000
Preferred Stock, shares outstanding	15,000	0
Common Stock, par value	$ 0.01	$ 0.01
Common Stock, shares authorized	1,000,000,000	2,000,000,000
Common Stock, shares issued	59,687,447	66,239,037
Common Stock, shares outstanding	59,576,383	58,672,998
Treasury stock, shares	111,064	7,566,039

XML

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
REVENUES:
Revenues	$ 233	$ 225	$ 429	$ 429
OPERATING EXPENSES:
Property tax, insurance and other	17	10	35	27
Management and royalty fees	9		9
Corporate general and administrative	39	19	63	38
Depreciation and amortization	39	34	76	68
Other, net	3	(1)	2	(3)
Total Operating Expenses	235	180	429	362
Operating Income (Loss)	(2)	45		67
OTHER INCOME (EXPENSES):
Interest expense	(18)	(12)	(31)	(24)
Other income, net	4		4
Loss on extinguishment of debt	(10)		(10)
Total Other Expenses, net	(24)	(12)	(37)	(24)
Income (loss) from Continuing Operations Before Income Taxes	(26)	33	(37)	43
Income tax expense	(2)	(14)	(1)	(19)
Income (loss) from Continuing Operations, net of tax	(28)	19	(38)	24
Loss from Discontinued Operations, net of tax	(20)	(2)	(25)	(6)
Net Income (loss) attributable to CorePoint Lodging stockholders	$ (48)	$ 17	$ (63)	$ 18
Earnings (loss) per share:
Basic and diluted from continuing operations	$ (0.48)	$ 0.32	$ (0.65)	$ 0.41
Basic and diluted from discontinued operations	(0.34)	(0.03)	(0.43)	(0.10)
Basic and diluted earnings (loss) per share	$ (0.82)	$ 0.29	$ (1.08)	$ 0.31
Rooms [Member]
REVENUES:
Revenues	$ 228	$ 221	$ 420	$ 421
OPERATING EXPENSES:
Cost of good or service	98	89	185	174
Other [Member]
REVENUES:
Revenues	5	4	9	8
OPERATING EXPENSES:
Cost of good or service	$ 30	$ 29	$ 59	$ 58

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Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Statement Of Income And Comprehensive Income [Abstract]
NET INCOME (LOSS)	$ (48)	$ 17	$ (63)	$ 18
Cash flow hedge adjustment, net of tax	3		3	2
Gain on termination of cash flow hedge	(3)		(3)
Comprehensive net income (loss) attributable to CorePoint Lodging's Stockholders	$ (48)	$ 17	$ (63)	$ 20

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Condensed Consolidated Statements of Equity (Unaudited) - 6 months ended Jun. 30, 2018 - USD ($) $ in Millions	Total	Common Stock [Member]	Treasury Stock [Member]	Additional Paid in Capital [Member]	Retained Earnings (Accumulated Deficit) [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Noncontrolling Interests [Member]
Beginning Balance at Dec. 31, 2017	$ 828	$ 1	$ (212)	$ 1,181	$ (144)	$ (1)	$ 3
Beginning Balance, shares at Dec. 31, 2017	58,672,998	58,672,998
Net income (loss)	$ (63)				(63)
Equity-based compensation	6			6
Equity-based compensation, shares		1,063,311
Repurchase of common stock | Pre Spin-Off [Member]	(2)	$ (48,862)	(2)
Repurchase of common stock | Post Spin-Off [Member]	(3)	(111,064)	(3)
Retirement of treasury shares			214	(214)
Cash flow hedge adjustment	4					4
Gain on termination of cash flow hedge	(3)					$ (3)
Reorganization and separation from La Quinta Holdings Inc	746				746
Ending Balance at Jun. 30, 2018	$ 1,513	$ 1	$ (3)	$ 973	$ 539		$ 3
Ending Balance, shares at Jun. 30, 2018	59,576,383	59,576,383

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Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Cash flows from operating activities:
Net income (loss)	$ (63)	$ 18
Adjustment to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	79	72
Amortization of other assets	1
Gain (loss) related to casualty disasters	2	(3)
Loss on extinguishment of debt	17
Amortization of deferred costs	4	3
Equity-based compensation expense	6	8
Deferred tax (benefit) expense	(1)	8
Provision for doubtful accounts	1	1
Changes in assets and liabilities:
Accounts receivable	9	(2)
Other assets	(14)	(10)
Accounts payable and accrued expenses	(18)	(10)
Other liabilities	(1)	5
Net cash provided by operating activities	22	90
Cash flows from investing activities:
Capital expenditures	(94)	(105)
Lenders escrow	(15)
Insurance proceeds on casualty disasters	7	5
Proceeds from sale of assets	4	22
Payment of franchise incentives		(1)
Net cash used in investing activities	(98)	(79)
Cash flows from financing activities:
Proceeds from debt	1,060
Repayment of debt	(1,005)	(9)
Debt issuance costs	(29)
Issuance of mandatorily redeemable preferred shares	15
Proceeds on termination of cash flow hedge	3
Purchase of treasury stock	(5)	(1)
Reorganization and separation from La Quinta Holdings Inc.	(23)
Net cash provided by (used in) financing activities	15	(10)
Increase (decrease) in cash and cash equivalents	(61)	1
Cash and cash equivalents at the beginning of the period	141	161
Cash and cash equivalents at the end of the period	80	$ 162
Interest Rate Cap
Cash flows from financing activities:
Payment for interest rate cap	$ (1)

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Organization and Basis of Presentation

6 Months Ended

Jun. 30, 2018

Organization Consolidation And Presentation Of Financial Statements [Abstract]

Organization and Basis of Presentation

NOTE 1. ORGANIZATION AND BASIS OF PRESENTATION

Organization and Business

CorePoint Lodging Inc., a Maryland corporation (“we,” “us,” “our,” “CorePoint Lodging” or the “Company”) is a nationwide lodging real estate company, primarily serving the upper mid-scale and mid-scale segments, with a portfolio of select service hotels located in the United States (“U.S.”).

The following table sets forth the number of owned and joint venture hotels as of June 30, 2018 and December 31, 2017 respectively:

	June 30, 2018				December 31, 2017
	# of hotels		# of rooms		# of hotels		# of rooms
Owned (1)		315		40,300		316		40,400
Joint Venture		1		200		1		200
Totals		316		40,500		317		40,600

⁽¹⁾ As of June 30, 2018 and December 31, 2017,  two and three of the owned hotels, respectively, were classified as assets held for sale.

For U.S. federal income tax purposes, we intend to elect to be taxed as a real estate investment trust (“ REIT”), effective May 31, 2018. We are currently, and expect to continue to be, organized and operated in a REIT qualified manner. As a REIT, the Company is generally not subject to federal corporate income tax on the portion of its net income that is currently distributed to its shareholders.  To maintain our REIT status, we are required to meet several requirements as provided by the Internal Revenue Code of 1986, as amended (the “Code”). These include that the Company cannot operate or manage its hotels. Therefore, the REIT leases the hotel properties to CorePoint TRS L.L.C., the Company's wholly owned taxable REIT subsidiary ("TRS"), which engages third-party eligible independent contractors to manage the hotels. CorePoint TRS L.L.C. is subject to federal, state and local income taxes. Also, to maintain REIT status, we must distribute annually at least 90% of our “REIT taxable income”, as defined by the Code, to our shareholders. We intend to meet our distribution requirements effective for 2018 as required by the Code.

Our Spin-Off from La Quinta Holdings Inc.

On January 18, 2017, La Quinta Holdings Inc., a Delaware corporation. (“LQH Parent,” and together with its consolidated subsidiaries, “LQH”) announced its intention to pursue the possibility of separating its real estate business from its franchise and management business, including the spin-off of its real estate ownership business into an independent, publicly traded company. The spin-off of CorePoint Lodging was made as part of a plan approved by LQH Parent’s board of directors to spin off LQH’s real estate business into a stand-alone, publicly traded company prior to the merger of LQH Parent with a wholly owned subsidiary of Wyndham Worldwide Corporation, a Delaware corporation (“Wyndham Worldwide”). The completion of the spin-off, followed by the completion of the merger, occurred on May 30, 2018. For additional discussion of the spin-off and related transactions, see Note 3.

Notwithstanding the legal form of the spin-off, for accounting and financial reporting purposes, LQH Parent is presented as being spun-off from CorePoint (a “reverse spin”). This presentation is in accordance with generally accepted accounting principles in the U.S. (“GAAP”), specifically Financial Account Standards Board (“FASB”) statement “Spinoff and Reverse Spinoffs”, and is primarily a result of the relative significance of CorePoint’s business to LQH’s business, as measured in terms of revenues, profits, and assets. Therefore, CorePoint Lodging Inc. is considered the divesting entity and treated as the “accounting successor,” and LQH Parent is the “accounting spinnee” and “accounting predecessor” for consolidated financial reporting purposes.

In accordance with FASB statement “Presentation of Financial Statements – Discontinued Operations”, effective with the closing of the spin-off on May 30, 2018, the results of operations related to LQH Parent’s hotel franchise and hotel management business are reported as discontinued operations for all periods presented. In addition, the assets and liabilities of LQH Parent’s hotel franchise and hotel management business have been segregated from the assets and liabilities related to the Company’s continuing operations and presented separately on the Company’s comparative balance sheet as of December 31, 2017. Unless otherwise noted, all disclosures in the notes accompanying the unaudited consolidated financial statements reflect only continuing operations.

Interim Unaudited Financial Information

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP for interim financial information, the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information or footnotes required by GAAP for complete annual financial statements. Although we believe the disclosures made are adequate to prevent the information presented from being misleading, these financial statements should be read in conjunction with LQH’s consolidated financial statements and notes thereto for the years ended December 31, 2017, 2016 and 2015, which are included in our Information Statement filed as Exhibit 99.1 to our Registration Statement on Form 10 (the “Form 10”), which the Securities and Exchange Commission (the “SEC”)  declared effective on May 8, 2018.

Subsequent to May 30, 2018, the accompanying unaudited condensed consolidated financial statements include the accounts of the Company. The historical unaudited condensed consolidated financial statements through May 30, 2018 represent the financial position and results of operations of entities that have historically been under common control of the accounting predecessor, LQH Parent.

The results for the interim periods shown in this report are not necessarily indicative of future financial results. The accompanying condensed consolidated balance sheet as of June 30, 2018 and condensed consolidated statements of operations, comprehensive income, cash flows and equity for the periods ended June 30, 2018 and 2017 have not been audited by our independent registered public accounting firm. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, including normal recurring items, necessary to present fairly our consolidated financial position as of June 30, 2018 and December 31, 2017, and our consolidated results of operations and cash flows for the periods ended June 30, 2018 and 2017.

The accompanying condensed consolidated financial statements include the accounts of the Company, as well as its wholly-owned subsidiaries and any consolidated variable interest entities (“VIEs”).  We recognize noncontrolling interests for the proportionate share of operations for ownership interests not held by our shareholders. All intercompany transactions have been eliminated.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.

Reclassifications

Certain line items on the condensed consolidated balance sheet as of December 31, 2017 and the condensed consolidated statements of operations for the three and six months ended June 30, 2017 have been reclassified to conform to the current period presentation. These reclassifications had no impact on our net income (loss) or financial position and were made in order to conform to presentations consistent with other REIT peers and reflect the results of discontinued operations. See Note 3 for additional information.

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Significant Accounting Policies and Recently Issued Accounting Standards

6 Months Ended

Jun. 30, 2018

Accounting Policies [Abstract]

Significant Accounting Policies and Recently Issued Accounting Standards

NOTE 2. SIGNIFICANT ACCOUNTING POLICIES AND RECENTLY ISSUED ACCOUNTING STANDARDS

Investment in Real Estate

Property and equipment are stated at cost less accumulated depreciation computed using a straight-line method over the estimated useful life of each asset. Property and equipment consists of the following, along with associated estimated useful lives:

Buildings and improvements	5 to 40 years
Furniture, fixtures and other equipment	2 to 10 years

We periodically review the useful lives of our long-lived assets based on current assessments of the remaining utility of our assets. Such changes are accounted for prospectively and would either increase or decrease depreciation expense in the accompanying condensed consolidated statements of operations.

We capitalize expenditures that increase the overall value of an asset or extend an asset’s life, typically associated with hotel refurbishment, renovation, and major repairs. Such costs primarily include third party contract labor, professional design and construction costs, including associated materials, and other direct and indirect costs, such as sales and use tax and interest costs, incurred during the redevelopment and renovation period. The capitalization period begins when the activities related to development have begun and ceases when the project is substantially complete and the assets are held available for use or occupancy. Once a redevelopment project is substantially complete and the associated assets are ready for intended use, costs related to the redevelopment project are no longer capitalized.

Normal maintenance and repair costs are expensed as incurred. When depreciable property is retired or disposed, the related cost and accumulated depreciation or amortization is removed from theapplicable accounts and any gain or loss is reflected in the accompanying statements of operations.  

Impairment of Real Estate Related Assets

If events or circumstances indicate that the carrying amount of a property may not be recoverable, we make an assessment of the property’s recoverability by comparing the carrying amount of the asset to our estimate of the aggregate undiscounted future operating cash flows expected to be generated over the holding period of the asset including its eventual disposition.  If the carrying amount exceeds the aggregate undiscounted future operating cash flows, we recognize an impairment loss to the extent the carrying amount exceeds the estimated fair value of the property. 

We did not record any impairment loss for the three and six months ended June 30, 2018 and 2017.

Assets Held for Sale

For sales of real estate or assets classified as held for sale, we evaluate whether the disposition will have a major effect on our operations and financial results and will therefore qualify as a strategic shift. If the disposition represents a strategic shift, it will be classified as discontinued operations in our consolidated statements of operations for all periods presented. If the disposition does not represent a strategic shift, it will be presented in continuing operations in our consolidated statements of operations.

We classify hotels as held for sale when certain criteria are met, in accordance with GAAP. At that time, we present the assets and obligations associated with the real estate held for sale separately in our consolidated balance sheet, and we cease recording depreciation and amortization expense related to that asset. Real estate held for sale is reported at the lower of its carrying amount or its estimated fair value less estimated costs to sell.

As of June 30, 2018 and December 31, 2017, we had two and three hotels held for sale, respectively.

Cash and Cash EquivalentsWe consider all cash on hand, demand deposits with financial institutions, and short-term highly liquid investments with original maturities of three months or less to be cash equivalents. Cash and cash equivalents consist of highly liquid investments that are stated at cost, which approximates fair market value. Certain balances in cash and cash equivalents exceed the Federal Deposit Insurance Corporation limit of $250,000; however, we believe credit risk related to these deposits is minimal.

Accounts Receivable

Accounts receivable primarily consists of receivables due from hotel guests, credit card companies and insurance settlements. Accounts receivable are carried at estimated collectable amounts. We periodically evaluate our receivables for collectability based on historical experience, the length of time receivables are past due, and the general economy. We provide an allowance for doubtful accounts, after considering factors that might affect the collection of accounts receivable, including historical losses and the ability of the party to meet its obligations to us.

Deferred Debt Issuance Costs

Deferred debt issuance costs include legal and bank issuance costs incurred in connection with issuance of debt, including costs associated with the issuance of our credit facilities, and are presented as a direct reduction from the carrying amount of debt. These debt issuance costs are deferred and amortized to expense over the term of the debt and are included as a component of interest expense. When debt is paid prior to its scheduled maturity date or the underlying terms are materially modified, the remaining carrying value of deferred debt issuance costs, along with certain other payments to lenders, is included in loss on early extinguishment of debt.

Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or pay to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. In evaluating the fair value of both financial and non-financial assets and liabilities, we use the accounting guidance that establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair value into three broad levels, which are as follows:

• Level 1—Quoted prices in active markets for identical assets or liabilities.

• Level 2—Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Valuations in this category are inherently less reliable than quoted market prices due to the degree of subjectivity involved in determining appropriate methodologies and the applicable underlying observable market assumptions.

• Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. These inputs cannot be validated by readily determinable market data and generally involve considerable judgment by management.

We use the highest level of observable market data if such data is available without undue cost and effort.

Derivative Instruments

We use derivative instruments as part of our overall strategy to manage our exposure to market risks associated with fluctuations in interest rates. We regularly monitor the financial stability and credit standing of the counterparties to our derivative instruments. We do not enter into derivative financial instruments for trading or speculative purposes.

We record all derivatives at fair value. On the date the derivative contract is entered, we designate the derivative as one of the following: a hedge of a forecasted transaction or the variability of cash flows to be paid (“cash flow hedge”), a hedge of the fair value of a recognized asset or liability (“fair value hedge”), or an undesignated hedge instrument. Changes in the fair value of a derivative that is qualified, designated and highly effective as a cash flow hedge or net investment hedge are recorded in the condensed consolidated statements of comprehensive income (loss) until they are reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Changes in the fair value of a derivative that is qualified, designated and highly effective as a fair value hedge, along with the gain or loss on the hedged asset or liability that is attributable to the hedged risk, are recorded in current period earnings. Cash flows from designated derivative financial instruments are classified within the same category as the item being hedged in the condensed consolidated statements of cash flows.

On a quarterly basis, we assess the effectiveness of our designated hedges in offsetting the variability in the cash flows or fair values of the hedged assets or obligations via use of a statistical regression and hypothetical derivative approach. We discontinue hedge accounting prospectively when the derivative is not highly effective as a hedge, the underlying hedged transaction is no longer probable, or the hedging instrument expires, is sold, terminated or exercised.

Revenue Recognition

We adopted Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers, effective January 1, 2018 using the modified retrospective transition method. The information in this section describes our current revenue recognition policies. See “Newly Adopted Accounting Standards” below for additional information related to the adoption.

Our revenues primarily consist of operating lease revenues from room rentals, and, to a lesser extent, restaurants, billboards and cell towers, which are accounted for under GAAP in accordance with lease accounting standards. Room revenue is recognized as earned on a daily basis, net of customer incentive discounts, cash rebates, and refunds.  Revenue related to operating leases with a term in excess of one year are recognized on a straight-line basis over the life of the respective lease agreement.  

Other revenues include revenues generated by the incidental support of hotel operations for hotels and are recognized under the revenue accounting standard as the service obligation is completed.

Equity-Based Compensation

We have a stock-based incentive award plan for our employees and directors. Stock-based compensation expense associated with these awards is recognized in general and administrative expenses in our consolidated statements of operations. We measure stock-based compensation at the estimated fair value on the grant date and recognize the amortization of stock-based compensation expense over the requisite service period. Fair value is determined based on grant date fair value.  We recognize forfeitures as they occur.

Income Taxes

We are organized in conformity with, and operate in a manner that will allow us to elect to be taxed as, a REIT, for U.S. federal income tax purposes beginning with our tax year ending December 31, 2018 and we expect to continue to be organized and operate so as to qualify as a REIT. To qualify as a REIT, we must continually satisfy requirements related to, among other things, the real estate qualification of sources of our income, the real estate composition and values of our assets, the amounts we distribute to our stockholders annually and the diversity of ownership of our stock. To the extent we qualify as a REIT, we generally will not be subject to U.S. federal income tax on taxable income generated by our REIT activities that we distribute to our stockholders. Accordingly, no provision for U.S. federal income taxes has been included in our accompanying condensed consolidated financial statements for purposes of determining the annualized effective tax rate applied to the six months ended June 30, 2018 related to our REIT activities.

We are, and will continue to be, subject to U.S. federal income tax on taxable sales of built-in gain property (representing property with an excess of fair value over tax basis held by us on May 30, 2018) during the five-year period following our election to be taxed as a REIT. In addition, we may be subject to state and local taxes and non-U.S. income tax on foreign held REIT activities. Further, our taxable REIT subsidiaries are generally subject to U.S. federal, state and local, and foreign income taxes (as applicable).

Through May 30, 2018, LQH Parent will file a federal income tax return, as well as certain state tax returns where we filed on a combined basis, and foreign tax filings, as applicable.

On December 22, 2017, the Tax Cuts and Jobs Act (the “Tax Act”) was enacted into law. The Tax Act contains several key tax provisions that affected us, including a reduction of the corporate income tax rate to 21% effective January 1, 2018, among others. We are required to recognize the effect of the tax law changes in the period of enactment, such as re-measuring our U.S. deferred tax assets and liabilities as well as reassessing the net realizability of our deferred tax assets and liabilities. In December 2017, the SEC staff issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (SAB 118), which allows us to record provisional amounts during a measurement period not to extend beyond one year of the enactment date. Since the Tax Act was passed late in the fourth quarter of 2017, and ongoing guidance and accounting interpretation is expected over the next 12 months, we consider the deferred tax re-measurements and other items to be incomplete due to the forthcoming guidance and our ongoing analysis of final year-end data and tax positions. We expect to complete our analysis within the one year measurement period permitted by SAB 118.

Concentrations of Credit Risk and Business Risk

Financial instruments, which potentially subject us to concentrations of credit risk, consist principally of cash and cash equivalents. We utilize financial institutions that we consider to be of high credit quality and consider the risk of default to be minimal. We also monitor the credit-worthiness of our customers and financial institutions before extending credit or making investments.

Lodging operations are particularly sensitive to adverse economic and competitive conditions and trends, which could adversely affect the Company’s business, financial condition, and results of operations.

Geographic concentrations, which potentially subject us to concentrations of business risk, relate primarily to locations of hotels and the revenue recognized in various states within the U.S. We have a concentration of hotels operating in Texas, Florida and California.

The percentages of our total revenues, excluding revenue from discontinued operations, from these states for the six months ended June 30, 2018 and 2017 are as follows:

	For the six months ended
	June 30, 2018			June 30, 2017
Texas		23	%		21	%
Florida		15	%		19	%
California		10	%		10	%
Total		48	%		50	%

Segment Reporting

Our hotels have similar economic characteristics and customers across all geographic locations, and our service offerings and delivery of services are provided in a similar manner, using the same types of facilities and similar technologies. Our chief operating decision maker, the Company's Chief Executive Officer, reviews our financial information on an aggregated basis. As a result, we have concluded that we have one reportable business segment.

Principal Components of Expenses

Rooms — These expenses include hotel expenses of housekeeping, reservation systems, room and breakfast supplies and front desk costs.

Other departmental and support— These expenses include labor and other expenses that constitute non-room operating expenses, including parking, telecommunications, on-site administrative departments, sales and marketing, recurring repairs and maintenance and utility expenses.

Property tax, insurance and other— These expenses consist primarily of real and personal property taxes, other local taxes, ground rent, equipment rent and insurance.

Management and royalty fees — Management fees represent fees paid to third parties and are computed as a percentage of gross revenue.  Royalty fees are generally computed as a percentage of rooms revenues. In connection with the spin-off, we entered into new management and franchise agreements, refer to Note 9, “Commitments and Contingencies” for additional information.

Corporate general and administrative — These expenses include off-site general and administrative expenses, consisting primarily of compensation, contract labor expense for our corporate staff, professional fees, travel expenses, and office administrative and related expenses.  

Other, net — These expenses include losses incurred resulting from property damage or destruction caused by any sudden, unexpected or unusual event such as a hurricane. Impairment losses are non-cash expenses that are recognized when circumstances indicate that the carrying value of a long-lived asset is not recoverable. An impairment loss is recognized for the excess of the carrying value over the fair value of the asset.

Newly Issued Accounting Standards

In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements. This guidance updates ASU 2016-02 Leases and provides entities an additional, optional transition method of initially applying the new lease standard at the adoption date and recognizing cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption, with comparative periods continuing to be presented in accordance with current GAAP. Previously, ASU 2018-02 required the new standard to be adopted on a modified retrospective basis. The Company is currently evaluating which option to elect.

In June 2018, the FASB issued ASU 2018-07, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income, which simplifies the accounting for share-based payments granted to nonemployees for goods and services. Under this ASU, most of the guidance on such payments to nonemployees would be aligned with the requirements for share-based payments granted to employees. The Company accounts for its share-based payments to members of its board of directors in the same manner as share-based payments to its employees. Other than to members of our board of directors, the Company does not award share-based payments to any nonemployees. The guidance is effective for periods beginning after December 15, 2018. Early adoption is allowed.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which changes the methodology for measuring credit losses on financial instruments and the timing of when such losses are recorded. The guidance affects entities holding financial assets and net investment in leases that are not accounted for at fair value through net income. The guidance will apply to our trade receivables, notes receivable, net investments in leases and any other future financial assets that have the contractual right to receive cash that we may acquire in the future. The guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019. Early adoption is permitted for fiscal years, and interim periods within those years, beginning after December 15, 2018. Historically, credit losses have not been material to the Company. We are currently evaluating the impact of this guidance on our financial position, results of operations and related disclosures but do not expect the implementation of this guidance to have a material impact on our condensed consolidated financial position and results of operations.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), regarding the accounting for leases for both lessees and lessors. In July 2018, ASU 2016-02 was amended, providing another transition method by allowing companies to initially apply the new lease standard in the year of adoption and not the earliest comparative period. The lease standard amendment also provided a practical expedient for an accounting policy election for lessors, by class of underlying asset, to not separate nonlease components from the associated lease components, similar to the practical expedient provided for lessees. The lessor practical expedient is only available if the timing and pattern of transfer are the same for the nonlease and lease components and the lease components, if accounted for separately, would be classified as an operating lease.

Lessees will need to recognize on their balance sheet a right-of-use asset and a lease liability for virtually all of their leases (other than leases that meet the definition of a short-term lease). The liability will be equal to the present value of lease payments. The asset will be based on the liability, adjusted for any initial direct costs of the lease, lease incentives or early lease payments, where applicable. For income statement purposes, the FASB retained a dual model, requiring leases to be classified as either operating or finance. Operating leases will result in straight-line rent expense (similar to current operating leases) while finance leases will result in interest and amortization expense (similar to current capital leases). Classification will be based on criteria that are largely similar to those applied in current lease accounting. The new standard may be adopted using a modified retrospective transition and provides for certain practical expedients. We are evaluating the impact of ASU 2016-02 on our consolidated financial statements, where we believe the primary impact as a lessee will relate to leases where we are the ground lessee.

Under current lessor accounting, a real estate lease could only be a sales-type lease if ownership of the real estate was transferred to the lessee. With the adoption of ASU 2016-02, there will no longer be an exclusion for real estate leases, where the same classification guidance applies as with all other leases. We are currently evaluating how this guidance would apply to lessor classification. If, as lessor, our real estate leases would be classified as sales-type leases, the real estate asset would be eliminated, a net investment asset would be recognized generally equal to the present value of the minimum lease payments plus the unguaranteed residual value and a selling profit or loss recorded. Additionally, only incremental direct leasing costs may be capitalized under this new guidance, which is primarily consistent with the Company’s existing policies.

In light of the recently issued lease standard amendment and the new practical expedients, we continue to evaluate the impact of the new leasing standard. We plan to adopt the new standard effective January 1, 2019.

Newly Adopted Accounting Standards

Effective January 1, 2018, we adopted FASB Topic 606. The revised guidance outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and superseded prior revenue recognition guidance, including industry-specific revenue guidance.  The revised guidance replaced most existing revenue and real estate sale recognition guidance in GAAP. The standard specifically excludes lease contracts, which is our primary recurring revenue source; however, our revenue accounting for incidental hotel revenue will follow the revised guidance. We adopted the new standard using the modified retrospective transition method, where financial statement presentations prior to the date of adoption are not adjusted. Transactions that were not closed as of the adoption date were adjusted to reflect the new standard where we recorded a net reduction to opening retained earnings of approximately $15 million, net of tax, as of January 1, 2018 due to the cumulative impact of adopting ASC 606, which relates primarily to our discontinued operations.

Effective January 1, 2018, we adopted FASB ASU 2017-05, which requires the derecognition of a business in accordance with ASC 810, Consolidations, including instances in which the business is considered in substance real estate. In cases where a controlling interest in real estate was sold but a noncontrolling interest is retained, we may record a gain or loss related to both the sold and retained interests. The adoption of this standard did not have an impact on our condensed consolidated financial statements, but depending on future transactions, may in the future.

Effective January 1, 2018, we adopted FASB ASU 2018-05, Income Taxes (Topic 740) - Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118, which provides guidance from the SEC allowing for the recognition of provisional amounts in the financial statements as a result of the Tax Act that was signed into law in December 2017. The guidance allows for a measurement period of up to one year from the enactment date to finalize the accounting related to the Tax Act. The Company has applied and continues to apply the guidance in this update within its financial statements.

Effective January 1, 2018, we adopted FASB ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220). The guidance in ASU 2018-02 allows an entity to elect to reclassify the stranded tax effects related to the Tax Act from accumulated other comprehensive income into retained earnings. The adoption of this statement did not have a material effect on our financial statements.

Effective January 1, 2018, we adopted FASB ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting. This update clarifies the changes to terms or conditions of a share-based payment award that require an entity to apply modification accounting. The adoption of this statement did not have a material effect on our financial statements.

Effective January 1, 2018 we adopted FASB ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business, which provides guidance for evaluating whether certain transactions are to be accounted for as an acquisition (or disposal) of either a business or an asset. This standard is applied on a prospective basis.  The adoption of this statement did not have a material effect on our financial statements.

From time to time, new accounting standards are issued by FASB or other standards setting bodies, which we adopt as of the specified effective date. Unless otherwise discussed, we believe the impact of recently issued standards that are not yet effective will not have a material impact on our consolidated financial statements upon adoption.

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Discontinued Operations

6 Months Ended

Jun. 30, 2018

Discontinued Operations And Disposal Groups [Abstract]

Discontinued Operations

NOTE 3. DISCONTINUED OPERATIONS

As discussed in Note 1, LQH Parent completed the separation of its real estate business, CorePoint, from the franchise and management business. The spin-off of CorePoint was made as part of a plan approved by LQH Parent’s board of directors to spin off LQH’s real estate business into a stand-alone, publicly traded company prior to the merger of LQH Parent with a wholly owned subsidiary of Wyndham Worldwide. To complete the spin-off, LQH Parent distributed to its stockholders all of the outstanding shares of CorePoint common stock. Each holder of LQH Parent common stock received one share of CorePoint common stock for each share of LQH Parent common stock held  by such holder as of 5:00 p.m., Eastern Time, on the record date, after giving effect to a reverse stock split, whereby each share of the common stock of LQH Parent (par value $0.01) was reclassified and combined into one half of a share of the common stock of LQH Parent (par value $0.02) (the “Reverse Stock Split”). Immediately following the spin-off, pursuant to the terms of the merger agreement LQH Parent became a wholly-owned subsidiary of Wyndham Worldwide and each share of LQH Parent common stock (after giving effect to the Reverse Stock Split) was converted into the right to receive $16.80 per share in cash (after giving effect to the Reverse Stock Split), without interest. The merger consideration is in addition to the shares of CorePoint common stock that the LQH Parent stockholders received in the distribution, as described above. Wyndham Worldwide repaid $715 million of LQH Parent’s debt net of cash and set aside a reserve of $240 million for estimated taxes expected to be incurred in connection with the spin-off. The completion of the spin-off, followed by the completion of the merger, occurred on May 30, 2018.

Immediately following the spin-off, LQH Parent did not own any shares of any class of CorePoint outstanding common stock. In connection with the spin-off, CorePoint had entered into a Separation and Distribution Agreement (the “Separation and Distribution Agreement”) in January 2018 and entered into several other agreements with LQH Parent prior to consummation of the spin-off. These agreements set forth the principal transactions required to effect CorePoint’s separation from LQH and provide for the allocation between CorePoint and LQH Parent of various assets, liabilities, rights and obligations (including employee benefits, intellectual property, insurance and tax-related assets and liabilities) and govern the relationship between CorePoint and LQH after completion of the spin-off. These agreements include, among others:

• an Employee Matters Agreement, dated January 7, 2018, between LQH and CorePoint, which governs certain obligations of LQH and CorePoint with respect to current and former LQH employees, including certain compensation and benefits obligations, the treatment of certain equity awards, and the allocation of certain employee-related assets and liabilities between LQH and CorePoint;

• a Tax Matters Agreement, dated May 30, 2018, between LQH and CorePoint, which governs LQH’s and CorePoint’s respective rights, responsibilities and obligations with respect to tax liabilities, tax attributes, the preparation and filing of tax returns, tax contests, and certain other tax matters, including a two-way adjustment to the extent LQH’s estimated tax liability as a result of the spin-off and related transactions is greater or less than an agreed-upon reserve amount set forth in the Tax Matters Agreement;

• Hotel Management Agreements and Franchise Agreements governing the ongoing relationship between LQH, as operator of CorePoint’s hotels, and CorePoint as the owner of such hotels; and

• a Transition Services Agreement, dated May 30, 2018, between LQH and CorePoint, pursuant to which each party will provide certain services to the other party for an interim period following the spin-off.

Notwithstanding the legal form of the spin-off, for accounting and financial reporting purposes, LQH Parent is presented as being spun-off from CorePoint (a “reverse spin”). This presentation is in accordance with GAAP and is primarily a result of the relative significance of CorePoint’s business to LQH’s business, as measured in terms of revenues, profits, and assets. Therefore, CorePoint Lodging Inc. is considered the divesting entity and treated as the “accounting successor,” and LQH Parent is the “accounting spinnee” and “accounting predecessor” for financial reporting purposes.

In accordance with ASC 205-20 Presentation of Financial Statements – Discontinued Operations, effective with the closing of the spin-off on May 30, 2018, the results of operations related to the hotel franchise and hotel management business are reported as discontinued operations for all periods presented. In addition, the assets and liabilities of the hotel franchise and hotel management business have been segregated from the assets and liabilities related to the Company’s continuing operations and presented separately on the Company’s comparative balance sheet as of December 31, 2017.

Because the separation was a spin-off among shareholders, for financial statement presentation, there is no gain or loss on the separation of the disposed net assets and liabilities. Rather, the carrying amounts of the net assets and liabilities of the Company’s former hotel franchise and hotel management accounts are removed at their historical cost with an offsetting amount to stockholders’ equity. As of June 30, 2018, the Company recorded a $746 million adjustment in stockholders’ equity from the spin-off. The amount recognized will be impacted in future reporting periods as the amount recorded is preliminary pending the finalization of various items including the final determination of the tax liabilities associated with the transaction and the settlement of other remaining considerations with Wyndham Worldwide. As these matters are finalized pursuant to the transaction agreements, the Company will record an adjustment to its cash balance with an offsetting amount to stockholders’ equity. Additionally, as the spin-off was a taxable spin, Wyndham Worldwide reserved $240 million to cover the tax payment for the spin transaction.  Any residual amount of the reserve above the tax payment will be remitted to the Company. As these tax valuations are completed and the estimates are refined and finalized, the impact of the reorganization and separation from La Quinta Holdings Inc. on stockholders’ equity will be adjusted.

Results of Discontinued Operations

The following table summarizes the results of the hotel franchise and hotel management business which are presented as discontinued operations (in millions).

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2018			2017			2018			2017
Revenues	$	25		$	38		$	58		$	69
OPERATING EXPENSES
General, administrative and marketing		36			30			64			58
Depreciation and amortization		2			2			4			4
Total Operating Expenses		38			32			68			62
Operating Income (Loss)		(13	)		6			(10	)		7
OTHER EXPENSES:
Interest expense		(6	)		(9	)		(15	)		(17	)
Loss on extinguishment of debt		(7	)		—			(7	)		—
Total Other Expenses		(13	)		(9	)		(22	)		(17	)
Loss Before Income Taxes		(26	)		(3	)		(32	)		(10	)
Income tax benefit		6			1			7			4
Loss from Discontinued Operations, net of tax	$	(20	)	$	(2	)	$	(25	)	$	(6	)

The following table presents the carrying amounts of the major classes of assets and liabilities of LQH Parent that were included in discontinued operations as of December 31, 2017:

	December 31, 2017
	(in millions)
ASSETS
Assets:
Total real estate, net	$	49
Intangible assets, net of accumulated amortization		171
Accounts receivable		24
Other assets		36
Total Assets	$	280
LIABILITIES AND EQUITY
Liabilities:
Debt, net	$	696
Accounts payable and accrued expenses		109
Other liabilities		21
Deferred tax liabilities		20
Total Liabilities	$	846

In connection with the spin-off, CorePoint made a cash payment to LQH Parent of approximately $1.002 billion (the “Cash Payment”), immediately prior to and as a condition of the spin-off. The Cash Payment was to facilitate the repayment of part of LQH Parent’s existing debt. In addition, simultaneously with the closing of the merger, Wyndham Worldwide repaid, or caused to be repaid, on behalf of LQH Parent, LQH Parent’s existing Term Facility (as defined below).

As permitted under GAAP, the Company has elected not to adjust the condensed consolidated statements of cash flows for the six months ended June 30, 2018 and June 30, 2017 to exclude cash flows attributable to discontinued operations. As such, the following table presents selected financial information of LQH Parent included in the condensed consolidated statements of cash flows:

	For the Six months ended June 30,
	June 30, 2018		June 30, 2017
	(in millions)
Non-cash items included in net income (loss):
Depreciation and amortization	$	4	$	4
Amortization of deferred costs		1		1
Loss on extinguishment of debt		7		—
Equity based compensation expense		4		4
Investing activities:
Capital expenditures	$	11	$	12

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Investments In Real Estate

6 Months Ended

Jun. 30, 2018

Real Estate Investments [Abstract]

Investments In Real Estate

NOTE 4. INVESTMENTS IN REAL ESTATE

Depreciation and amortization expense related to property and equipment was $39 million and $34 million for the three months ended June 30, 2018 and 2017 respectively. Depreciation and amortization expense related to property and equipment was $76 and $68 million for the six months ended June 30, 2018 and 2017, respectively. Construction in progress includes capitalized costs for ongoing projects that have not yet been put into service.

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Other Assets

6 Months Ended

Jun. 30, 2018

Other Assets [Abstract]

Other Assets

NOTE 5. OTHER ASSETS

Other assets include the following as of June 30, 2018 and December 31, 2017:

	June 30, 2018		December 31, 2017
	(in millions)
Assets held for sale	$	5	$	9
Lenders escrow		15		—
Intangible assets		5		5
Other assets		30		18
Total other assets	$	55	$	32

As of December 31, 2017, three hotels were classified as assets held for sale. The sale of these assets does not represent a major strategic shift and does not qualify for discontinued operations reporting. During the first quarter of 2018, one of these hotels was sold for $4 million, net of transaction costs, resulting in a gain of $1 million. Subsequent to the end of the second quarter of 2018, one of these hotels was sold for $2 million, net of transaction costs. The remaining hotel is expected to be sold before the end of 2018.

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Debt

6 Months Ended

Jun. 30, 2018

Debt Disclosure [Abstract]

Debt

NOTE 6.  DEBT

Debt as of June 30, 2018 and December 31, 2017 was as follows:

	June 30, 2018			December 31, 2017
	(in millions)
CMBS Facility	$	1,035		$	—
Revolving Facility		25			—
Term Facility		—			1,003
		1,060			1,003
Less deferred debt issuance costs and original issue discount		(28	)		(11	)
Total debt, net (1)	$	1,032		$	992

⁽¹⁾ As of June 30, 2018 and December 31, 2017, the 30 day United States dollar London Interbank Offering Rate (“LIBOR”) was 2.09% and 1.56%, respectively. As of June 30, 2018, the interest rate, maturity date and principal payments on the CMBS Facility (as defined below) and Term Facility (defined below) were as follows:

• The interest rate for the CMBS Facility through June 30, 2018 was LIBOR with a floor of 0.0% plus a spread of 2.75%. Interest expense on the CMBS Facility for the three and six months ended June 30, 2018 was approximately $6 million. Included in the CMBS Facility, as of June 30, 2018 is the deduction of debt issuance costs of $28 million, net of amortization. As of June 30, 2018, we had $5 million in accrued interest included within accounts payable and accrued expenses in the accompanying condensed consolidated balance sheet.

• The interest rate for the Revolving Facility is, at the option of the CorePoint Revolver Borrower, either at a base rate plus a margin of 3.5% or LIBOR rate plus a margin of 4.5%.

• In connection with the consummation of the merger, on May 30, 2018, all outstanding amounts under the Term Facility were repaid in full.

• The interest rate for the Term Facility from January 1, 2018 to March 6, 2018, was LIBOR with a floor of 1.0% plus a spread of 2.75%. As of March 6, 2018, the rate increased to LIBOR with a floor of 1.0% plus a spread of 3.0% for the period from March 6, 2018 to May 30, 2018. Included in the Term Facility as of December 31, 2017 is an unamortized original issue discount of $3 million. Interest expense on the Term Facility for the three and six months ended June 30, 2018 was approximately $8 million and $19 million, respectively. Interest expense on the Term Facility for the three and six months ended June 30, 2017 was approximately $10 million and $21 million, respectively. Included in the Term Facility, as of December 31 ,2017 is the deduction of debt issuance costs of $8 million, net of amortization. As of December 31, 2017, we had $9 million in accrued interest included within accounts payable and accrued expenses in the accompanying condensed consolidated balance sheets.

Extinguishment of debt

In connection with the spin-off and merger, on May 30, 2018, we entered into the CMBS Loan Agreement and used the proceeds to repay or discharge existing loans (“Term Facility”) related to the properties covered by the facility.  During the six months ended June 30, 2018, we recorded a $10 million loss related to the extinguishment of the Term Facility. The losses included the write-off of unamortized debt issuance costs and original issuance discount.

CMBS Facility

On May 30, 2018, certain indirect wholly-owned subsidiaries of CorePoint (collectively, the “CorePoint CMBS Borrower”), CorePoint TRS L.L.C (the “Operating Lessee”), and CorePoint Operating Partnership L.P. (the “CorePoint OP”) entered into a Loan Agreement (the “CMBS Loan Agreement”), pursuant to which the CorePoint CMBS Borrower borrowed an aggregate principal amount of $1.035 billion under a secured mortgage loan secured primarily by mortgages for 307 owned and ground leased hotels, an excess cash flow pledge for seven owned and ground leased hotels and other collateral customary for mortgage loans of this type (the “CMBS Facility”). The proceeds from the CMBS Facility were used to facilitate the repayment of part of LQH Parent’s existing debt. In addition, simultaneously with the closing of the merger, Wyndham repaid, or caused to be repaid, on behalf of LQH Parent, LQH Parent’s existing Term Facility. The CMBS Facility has an initial term of two years, with five extension options of twelve months each exercisable at the CorePoint CMBS Borrower’s election provided that CorePoint CMBS Borrower provide Lender at least 30 days’, but not more than 120 days’, notice, there is no event of default existing as of the commencement of the applicable extension period and the CorePoint CMBS Borrower either extends the current interest rate cap or purchases a new interest rate cap covering the extension period at a strike price as set forth in the CMBS Loan Agreement.

As long as LIBOR is able to be determined, the CMBS Facility bears interest at a rate equal to the sum of (i) one-month LIBOR (rounded to the nearest 1/1000th of a percent subject to a floor of 0.00%) and (ii) 2.75% per annum for the first 5 years of the term, 2.90% for the 6th year of the term and 3.00% for the 7th year of the term.

The CMBS Facility is pre-payable in whole or in part subject to payment of (i) in the case of prepayments (other than in certain enumerated cases) made prior to or on the December 2019 payment date (provided that with respect to any prepayment made after the payment date in November 2019, but prior to the December 2019 payment date, the amount of the spread maintenance payment shall be zero), a spread maintenance premium and in certain cases third party LIBOR breakage costs, and (ii) all accrued interest through the date of prepayment prior to a securitization and through the end of the applicable accrual period following a securitization. Notwithstanding the above, the CorePoint CMBS Borrowers are permitted to prepay the CMBS Facility by an amount not to exceed 20% of the original principal balance of the CMBS Facility, in the aggregate without payment of any spread maintenance premium.

CorePoint OP delivered a customary non-recourse guaranty in connection with the CMBS Facility. Under such guaranty, (i) CorePoint OP will agree to indemnify the lender for certain losses arising out of customary “bad-boy” acts of CorePoint OP and its affiliates, including the CorePoint CMBS Borrower and (ii) the CMBS Facility will become fully recourse to CorePoint OP upon the occurrence of certain bankruptcy events capped at 10% of the then outstanding principal balance of the CMBS Facility. With respect to environmental matters, the CMBS Facility is recourse to the CorePoint CMBS Borrower only, provided that the required environmental insurance is delivered to the lender.

The CMBS Facility includes certain customary affirmative and negative covenants and events of default, including, among other things, restrictions on the ability of the CorePoint CMBS Borrower to incur additional debt and transfer, pledge or assign certain equity interests or its assets, and covenants requiring the CorePoint CMBS Borrower to exist as “special purpose entities,” maintain certain ongoing reserve funds and comply with other customary obligations for commercial mortgage-backed securities loan financings. As of June 30, 2018, the Company is in compliance with these covenants.

At the closing of the CMBS Facility, the CorePoint CMBS Borrower deposited in the loan servicer’s account approximately $15 million in upfront reserves for property improvement and environmental remediation, which funds may be periodically disbursed to the CorePoint CMBS Borrower throughout the term of the loan to cover such costs. In addition, revenues to be distributed to the CorePoint CMBS Borrower will be required to be deposited first into a segregated account under the control of the CMBS Facility lender (the “Clearing Account”). All cash in the Clearing Account will be transferred to an account under the control of the Operating Lessee as long as (i) there is no event of default under the loan or (ii) the debt yield for the CMBS Facility (calculated based on the outstanding principal balance of the CMBS Facility) does not fall below (x) 12.33% for the first five years of the CMBS Facility loan term or (y) 12.83% for the sixth and seventh years of the CMBS Facility loan term, in each case for two consecutive calendar quarters. Upon the occurrence and continuation of either (i) or (ii) above, all cash in the Clearing Accounts will be transferred to an account under the control of the lender to be applied to payment of all monthly amounts due under the CMBS Facility loan documents including, but not limited to, debt service for the CMBS Facility and the Revolving Facility, agent fees and expenses, required ongoing reserves, property operating expenses, sales and use taxes and custodial fees. The remaining funds will be deposited into an excess cash flow account, also under the control of the lender, which funds will be available to the CorePoint CMBS Borrower, provided there is no event of default under the loan for payment of, among other things, various operating expenses and dividends, distributions and redemptions sufficient to maintain certain tax-preferential treatment for the CorePoint CMBS Borrower.

As required by, and in connection with CorePoint Lodging’s entry into the CMBS Loan Agreement (defined below), we entered into an interest rate cap agreement on May 30, 2018 with a notional amount of $1.035 billion and a LIBOR rate cap of 3.25% that expires on July 15, 2020 (the “Interest Rate Cap Agreement”). The Interest Rate Cap Agreement is for a period equal to the existing term of the CMBS Facility and has a notional amount equal to or greater than the then outstanding principal balance of the CMBS Facility. The Company did not designate the interest rate cap as a hedge.

Revolving Facility

Also on May 30, 2018, the CorePoint Revolver Borrower and CorePoint OP entered into the Revolver Credit Agreement providing for the $150 million Revolving Facility, of which $25 million was drawn upon consummation of the spin-off. The Revolving Facility will mature on May 30, 2020, with an election to extend the maturity for one additional year subject to certain conditions, including that the maturity of the CMBS Facility be extended to a date no earlier than the maturity of the Revolving Facility.

The interest under the Revolving Facility will be, at the option of the CorePoint Revolver Borrower, either at a base rate plus a margin of 3.50% or a LIBOR rate plus a margin of 4.50%. With respect to base rate loans, interest will be payable at the end of each quarter. With respect to LIBOR loans, interest will be payable at the end of the selected interest period but no less frequently than quarterly. Additionally, there is a commitment fee payable at the end of each quarter equal to 0.50% of unused commitments under the Revolving Facility and customary letter of credit fees.

The Revolving Facility contains customary representations and warranties, affirmative and negative covenants and defaults. The Revolving Facility also contains a maximum total net leverage ratio financial covenant and minimum interest coverage ratio financial covenant, in each case, tested as of the last day of any fiscal quarter in which borrowings under the Revolving Facility and outstanding letters of credit exceed 10% of the aggregate commitments of the Revolving Facility. As of June 30, 2018, the Company is in compliance with these covenants.

The obligations under the Revolving Facility are unconditionally and irrevocably guaranteed by CorePoint OP, and, subject to certain exceptions, each of the CorePoint Revolver Borrower’s existing and future domestic subsidiaries that own equity interests in any CorePoint CMBS Borrower (collectively, the “Revolver Subsidiary Guarantors”). The CorePoint Revolver Borrower’s obligations under the Revolving Facility and any hedging or cash management obligations are secured by (i) a perfected first-lien pledge of all equity interests in the CorePoint Revolver Borrower, all equity interests in any Revolver Subsidiary Guarantor and, subject to certain exceptions, all equity interests in certain CorePoint CMBS Borrowers and (ii) a perfected first-priority security interest in the CorePoint Revolver Borrower’s conditional controlled deposit account.

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Preferred Stock

6 Months Ended

Jun. 30, 2018

Equity [Abstract]

Preferred Stock

NOTE 7.  PREFERRED STOCK

In connection with La Quinta’s internal reorganization prior to the spin-off, the Company issued 15,000 shares of Cumulative Redeemable Series A Preferred Stock, par value $0.01 per share (the “Series A preferred stock”), to La Quinta Intermediate Holdings, L.L.C., a wholly owned subsidiary of La Quinta. Such securities were issued in reliance on the exemption contained in Section 4(a)(2) of the Securities Act, as a transaction by an issuer not involving a public offering. La Quinta Intermediate Holdings, L.L.C. privately sold all of the Series A preferred stock to an unrelated third-party investor immediately prior to the completion of the spin-off.

On May 30, 2018, the Company filed with the State Department of Assessments and Taxation of Maryland Articles Supplementary (the “Articles Supplementary”) regarding certain rights of the shares of the Series A preferred stock. The Series A preferred stock has an aggregate liquidation preference of $15 million, plus any accrued and unpaid dividends thereon. We pay a cash dividend on the Series A preferred stock equal to 13% per annum, payable quarterly. If either our leverage ratio exceeds 7.5 to 1.0 as of the last day of any fiscal quarter, or if an event of default occurs (or has occurred and has not been cured) with respect to the Series A preferred stock, we will be required to pay a cash dividend on the Series A preferred stock equal to 15% per annum. Our dividend rate on the Series A preferred stock will increase to 16.5% per annum if, at any time, we are both in breach of the leverage ratio covenant and an event of default occurs (or has occurred and has not been cured) with respect to the Series A preferred stock. The Series A preferred stock are senior to our common stock with respect to dividends and with respect to dissolution, liquidation or winding up of the Company.

Holders of Series A preferred stock generally have no voting rights. However, the Articles Supplementary provided that, without the prior consent of the holders of a majority of the outstanding shares of Series A preferred stock, we are prohibited from (i) issuing any capital stock ranking senior to or on parity with the Series A preferred stock, (ii) authorizing or issuing any additional shares of Series A preferred stock, (iii) amending our charter in any manner that would adversely affect the Series A preferred stock, or (iv) entering into, amending or altering any provision of any agreement in a manner that could reasonably be expected to be material and adverse to the Series A preferred stock. The holders of the Series A preferred stock also have exclusive voting rights on any amendment to our charter that would alter the contract rights of only the Series A preferred stock. If we are either (a) in arrears on the payment of dividends that were due on the Series A preferred stock on six or more quarterly dividend payment dates, whether or not such dates are consecutive, or (b) in default of our obligations to redeem the preferred stock on the tenth anniversary of its issuance or following a change of control, the preferred shareholders may designate a representative to attend meetings of our board of directors as a non-voting observer until all unpaid preferred stock dividends have either been paid or declared with an amount sufficient for payment set aside for payment, or the shares required to be redeemed have been redeemed, as applicable.

The Series A preferred stock is mandatorily redeemable by us upon the tenth anniversary of the date of issuance. Beginning on the seventh anniversary of the issuance of the Series A preferred stock, we may redeem the outstanding Series A preferred stock for an amount equal to its aggregate liquidation preference, plus any accrued but unpaid dividends. The holders of the Series A preferred stock may also require us to redeem the Series A preferred stock upon a change of control of the Company for an amount equal to its aggregate liquidation preference plus any accrued and unpaid dividends thereon (and a premium if the change of control occurs prior to the seventh anniversary of the issuance of the Series A preferred stock).

Shares of the Series A preferred stock may not be transferred until the date that is six months after the date of issuance of the Series A preferred stock and then only in tranches having an aggregate liquidation value of at least $2.5 million.

On August 13, 2018, the Company filed with the State Department of Assessments and Taxation of Maryland Articles of Amendment (the “Articles of Amendment”) to the Articles Supplementary for the Series A preferred stock, to, among other things, remove the consent right of holders of shares of the Series A preferred stock over designations or issuances by us of any class or series of our stock ranking on parity with the Series A preferred stock, and instead provide such holders with certain preemptive rights over issuances of such parity stock. As required under the Articles Supplementary, the holders of a majority of the Series A preferred stock approved the Articles of Amendment. Due to the fact that the preferred stock is mandatorily redeemable by us, it is classified as a liability on the accompanying condensed consolidated balance sheet as of June 30, 2018. Dividends on these preferred shares are classified as interest expense in the accompanying condensed consolidated statements of operations.

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Fair Value Measurements

6 Months Ended

Jun. 30, 2018

Fair Value Disclosures [Abstract]

Fair Value Measurements

NOTE 8. FAIR VALUE MEASUREMENTS

The carrying amount and estimated fair values of our financial assets and liabilities were as follows:

	June 30, 2018				December 31, 2017
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
	(in millions)
Debt - CMBS Facility(1)(2)	$	1,007	$	1,007	$	—	$	—
Debt - Revolver(1)		25		25		—		—
Interest rate caps (3)		1		1		—		—
Debt - Term Facility(1)(4)(2)		—		—		992		1,007
Interest rate swaps (3)		—		—		1		1
Mandatorily redeemable preferred shares(1)		15		15		—		—

⁽¹⁾ Classified as Level 3 under the fair value hierarchy.

⁽²⁾ Carrying amount includes deferred debt issuance costs of $28 million as of June 30, 2018.

⁽³⁾ Classified as Level 2 under the fair value hierarchy.

⁽⁴⁾ Carrying amount includes deferred debt issuance costs of $14 million as of December 31, 2017.

We believe the carrying amounts of our cash and cash equivalents and lenders escrow approximated fair value as of June 30, 2018 and December 31, 2017, as applicable. Our estimates of the fair values were determined using available market information and valuation methods appropriate in the circumstances.

Considerable judgment is necessary to interpret market data and develop estimated fair values. Proper placement of fair value measurements within the valuation hierarchy is considered each reporting period. The use of different market assumptions or estimation methods may have a material effect on the estimated fair value amounts.

The fair values of interest rate swaps and interest cap are determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each instrument. This analysis reflects the contractual terms of the agreements, including the period to maturity, and uses observable market-based inputs, including forward interest rate curves. We incorporate credit valuation adjustments to appropriately reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk in the fair value measurements.

We estimate the fair value of our debt and mandatorily redeemable preferred stock by using discounted cash flow analysis based on current market inputs for similar types of arrangements. The primary sensitivity in these calculations is based on the selection of appropriate discount rates. Fluctuations in these assumptions will result in different estimates of fair value.

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2018

Commitments And Contingencies Disclosure [Abstract]

Commitments and Contingencies

NOTE 9. COMMITMENTS AND CONTINGENCIES

Hotel Management and Operating License Agreements

Management Fees

On May 30, 2018, the Company entered into management agreements with La Quinta Management L.L.C (“LQM”), whereby it pays a fee equal to 5% of total gross revenues, as defined, which is classified as management and royalty fees in the accompanying condensed consolidated statements of operations.

LQM generally has sole responsibility for all activities necessary for the operation of the hotels, including establishing room rates, processing reservations and promoting and publicizing the hotels. LQM also provides all employees for the hotels, prepares reports, budgets and projections, and provides other administrative and accounting support services to the hotels. We have consultative and limited approval rights with respect to certain actions of LQM, including entering into long-term or high value contracts, engaging in certain actions relating to legal proceedings, approving the operating budget, making certain capital expenditures and the hiring of certain management personnel. We are also responsible for reimbursing LQM for certain costs incurred by LQM during the fulfillment of their duties, such as payroll costs for certain employees and other costs that the manager incurs to operate the hotels.  The term of the management agreements is 20 years, subject to two renewals of five years each, at the LQM’s option.

Franchise Fees

In connection with the spin-off, we entered into franchise agreements with La Quinta Franchising LLC (“LQ Franchising”). Pursuant to the franchise agreements, we were granted a limited, non-exclusive license to use our franchisor’s brand names, marks and system in the operation of our hotels. The franchisor also may provide us with a variety of services and benefits, including centralized reservation systems, participation in customer loyalty programs, national advertising, marketing programs and publicity designed to increase brand awareness, as well as training of personnel. In return, we are required to operate franchised hotels consistent with the applicable brand standards. As of June 30, 2018, 315 of our franchise agreements were with LQ Franchising. In the second quarter of 2018, one hotel transitioned to a Baymont branded hotel.

Our franchise agreements require that we pay a 5% royalty fee on gross rooms revenue. The royalty fee is included within management and royalty fees in the accompanying condensed consolidated statements of operations. The term of the franchise agreements is 20 years from the opening date, subject to one renewal of ten years, at the franchisor’s option.

In addition to the royalty fee, the LQ Franchising agreement includes a reservation fee of 2% of gross room revenues, a marketing fee of 2.5% of gross room revenues, a loyalty program fee of 5% of eligible room night revenue, and other miscellaneous ancillary fees.  The Baymont franchise agreement includes a reservation fee of 1.5% of gross room revenues, a marketing fee of 2% of gross room revenues, a loyalty program fee of 5% of eligible room night revenue, and other miscellaneous ancillary fees.  Reservation fees are included within room expense in the accompanying condensed consolidated statements of operations.  The marketing fee and loyalty program fees are included within other departmental and support in the accompanying condensed consolidated statements of operations.  

Litigation

We are a party to a number of pending claims and lawsuits arising in the normal course of business, including proceedings involving tort and other general liability claims, workers’ compensation and other employee claims and intellectual property claims. We do not consider our ultimate liability with respect to any such claims or lawsuits, or the aggregate of such claims and lawsuits, to be material in relation to our condensed consolidated financial condition, results of operations or our cash flows taken as a whole.

We maintain general and other liability insurance; however, certain costs of defending lawsuits, such as those below the retention or insurance deductible amount, are not covered by or are only partially covered by insurance policies, and our insurance carriers could refuse to cover certain claims in whole or in part. We regularly evaluate our ultimate liability costs with respect to such claims and lawsuits. We accrue costs from litigation as they become probable and estimable.

Tax Contingencies

We are subject to regular audits by federal and state tax authorities. These audits may result in additional tax liabilities. The Internal Revenue Service (“IRS”) is currently auditing the tax returns of La Quinta Corporation, one of our former REITs, and BRE/LQ Operating Lessee Inc., one of our former taxable REIT subsidiaries, in each case for the tax years ended December 31, 2010 and 2011. We received a draft notice of proposed adjustment from the IRS on January 9, 2014, and the notice of proposed adjustment was issued to us on June 2, 2014. We submitted a timely response to the notice of proposed adjustment and, on July 7, 2014, we received an IRS 30-Day Letter proposing to impose a 100% tax on the REIT totaling $158 million for the periods under audit in which the IRS has asserted that the rent charged for these periods under the lease of hotel properties from the REIT to the taxable REIT subsidiary exceeded an arm’s length rent. In addition, the IRS proposed to eliminate $89 million of net operating loss carryforwards for the taxable REIT subsidiary for the tax years 2006 through 2009; however, in an IRS rebuttal received on September 26, 2014, the IRS conceded its proposed adjustment on this point was incorrect. We disagree with the IRS’ position with respect to rents charged by the REIT to its taxable REIT subsidiary and have appealed the proposed tax and adjustments to the IRS Appeals Office. In determining amounts payable by our taxable REIT subsidiary under the lease, we engaged a third party to prepare a transfer pricing study contemporaneous with the lease which concluded that the lease terms were consistent with an arm’s length rent as required by relevant provisions of the Code and applicable Treasury Regulations. Attorneys and others representing the Company conducted preliminary discussions regarding the appeal with the IRS Appeals Office team on March 31, 2015 and April 1, 2015. In response to a supplemental analysis submitted by the IRS economist to IRS Appeals Office and provided to us on August 18, 2015, we submitted responses dated September 3, 2015 and October 1, 2015.  

Our most recent meeting with the IRS Appeals Office team occurred on January 25, 2017. In November 2017, IRS Appeals returned the matter to IRS Examination for further factual development. We believe the IRS transfer pricing methodologies applied in the audits contain flaws and that the IRS proposed tax and adjustments are inconsistent with the U.S. federal tax laws related to REITs. We have concluded that the positions reported on our tax returns under audit by the IRS are, based on their technical merits, more-likely-than-not to be sustained upon examination. Accordingly, as of June 30, 2018, we have not established any reserves related to this proposed adjustment or any other issues reflected on the returns under examination. If, however, we are unsuccessful in challenging the IRS, an excise tax would be imposed on the REIT equal to 100% of the excess rent and we could owe additional income taxes, interest and penalties, which could adversely affect our financial condition, results of operations and cash flow and the price of our common stock. Such adjustments could also give rise to additional state income taxes.

On November 25, 2014, we were notified that the IRS intended to examine the tax returns of the same entities subject to the 2010 and 2011 audit in each case for the tax years ended December 31, 2012 and 2013.  We have received several draft notices of proposed adjustment proposing a transfer-pricing related assessment of approximately $18 million for 2013 and adjustments to our net operating losses for the years 2006 through 2009.  The IRS has since indicated that it will not pursue the transfer-pricing adjustment. On August 8, 2017, the IRS issued a 30-Day Letter, in which it is proposed to disallow net operating loss carryovers originating in tax years 2006-2011 or, in the alternative, tax years 2006-2009, depending upon the outcome of the 2010-2011 examination discussed above. On September 26, 2017, we furnished a timely protest to the IRS exam team. They have since indicated that they intend to furnish a rebuttal to our protest, at which time the matter will be referred to the IRS Appeals Office. Based on our analysis of the NOL notice, we believe the IRS NOL disallowances applied in the 2012-2013 audit contain the same flaws present in the 2010-2011 audit and that the IRS proposed NOL adjustments are inconsistent with the U.S. federal tax laws related to REITs.  We have concluded that the positions reported on our tax returns under audit by the IRS are, based on their technical merits, more-likely-than-not to be sustained upon examination. Accordingly, as of June 30, 2018, we have not established any reserves related to this proposed adjustment or any other issues reflected on the returns under examination.

Purchase Commitments

As of June 30, 2018, we had approximately $19 million of purchase commitments related to certain continuing redevelopment and renovation projects and other commitments.

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Income Taxes

6 Months Ended

Jun. 30, 2018

Income Tax Disclosure [Abstract]

Income Taxes

NOTE 10. INCOME TAXES

The Company intends to elect REIT status with the filing of its tax return for the period May 31, 2018 through December 31, 2018.  To qualify as a REIT, the Company must meet a number of organizational, operational, and distribution requirements. As a REIT, the Company is generally not subject to federal corporate income taxes on the portion of its net income that is currently distributed to its shareholders. To the extent the Company does not distribute 100% of its taxable income for any year in which it has elected REIT status, the Company will be subject to income tax on the undistributed taxable income.  It is the Company’s current intention to adhere to these requirements and maintain the Company’s qualification for taxation as a REIT, including the requirement to distribute its taxable income. If the Company fails to qualify for taxation as a REIT in any taxable year, it will be subject to federal income taxes at regular corporate rates and may not be able to qualify as a REIT for the four taxable years subsequent to the year of an uncured REIT qualification failure. Even if the Company qualifies for taxation as a REIT, the Company may be subject to certain state and local taxes on its income and property, and to federal income and excise taxes on its undistributed taxable income. In addition, taxable income from non-REIT activities managed through the Company's TRS is subject to federal, state and local income taxes at normal corporate rates.

The Company recorded a provision for federal, state and foreign income tax expense of approximately $2 million and $14 million for the three months ended June 30, 2018 and 2017, respectively. The Company recorded a provision for federal, state and foreign income tax expense of approximately $1 million and $19 million for the six months ended June 30, 2018 and 2017, respectively. The provision for the three and six month periods ended June 30, 2018 and 2017 differs from the statutory federal tax rates of 21% and 35%, respectively, primarily due to the impact of state income taxes, the impact of certain costs relating to the separation of our franchise and management business from our owned real estate assets that are not deductible for income tax purposes, and the impact on the determination of the annualized effective tax rate as a result of the election of REIT status.

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Equity-Based Compensation

6 Months Ended

Jun. 30, 2018

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Equity-Based Compensation

NOTE 11. EQUITY-BASED COMPENSATION

We recognize the cost of services received in an equity-based payment transaction with an employee as services are received and record either a corresponding increase in equity or a liability, depending on whether the instruments granted satisfy the equity or liability classification criteria.

The measurement objective for these equity awards is the estimated fair value at the grant date of the equity instruments that we are obligated to issue when employees have rendered the requisite service and satisfied any other conditions necessary to earn the right to benefit from the instruments. The compensation cost for an award classified as an equity instrument is recognized ratably over the requisite service period. The requisite service period is the period during which an employee is required to provide service for an award to vest. We recognize forfeitures as they occur.

In connection with the spin-off, the Company entered an agreement with LQH Parent to modify all outstanding awards granted to the employees of LQH Parent. Under the agreement, holders of LQH restricted stock awards and LQH restricted stock units received restricted shares and restricted stock units of CorePoint common stock.  Holders of LQH performance share units received CorePoint restricted stock awards.

Share-based compensation awards of employees remaining at La Quinta were adjusted in accordance with the anti-dilution provisions of the La Quinta Incentive Plan with the intent to preserve the intrinsic value of the original awards. The adjustments were determined by comparing the fair value of such awards immediately prior to the spin-offs to the fair value of such awards immediately after the spin-offs. Equity awards that were adjusted generally remain subject to the same vesting, expiration and other terms and conditions as applied to the awards immediately prior to the spin-offs.

Treatment of LQH Parent Outstanding Equity Awards

With respect to LQH Parent equity-based compensation awards that were outstanding under the LQH Incentive Plan on the distribution date, the Employee Matters Agreement entered into with LQH Parent, generally provides that, as of the separation, holders of such awards will be entitled to receive CorePoint equity-based compensation awards in amounts based on the distribution ratio. Generally, all such CorePoint equity-based compensation awards (except for the LQH PSUs, as described below) retain the same terms and vesting conditions as the original LQH Parent equity-based compensation awards to which such awards relate.

Treatment of LQH RSAs. At the spin-off, each holder of an LQH RSA received a number of restricted shares of CorePoint common stock (each, a “CPLG RSA”) calculated by multiplying (i) the number of LQH RSAs subject to each grant by (ii) the distribution ratio, rounded up to the nearest whole share. The CPLG RSAs are subject to the same terms and conditions from and following the spin-off as the terms and conditions applicable to the corresponding LQH RSAs immediately prior to the spin-off and will vest subject to continued employment with LQH or CorePoint, as applicable.

Treatment of LQH RSUs. At the spin-off, each holder of an LQH RSU received a number of restricted stock units of CorePoint common stock (each, a “CPLG RSU”) calculated by multiplying (i) the number of LQH RSUs subject to each grant by (ii) the distribution ratio, rounded up to the nearest whole share. The CPLG RSUs are subject to the same terms and conditions from and following the spin-off as the terms and conditions applicable to the corresponding LQH RSUs immediately prior to the spin-off and will vest subject to continued service with LQH or CorePoint, as applicable.

Treatment of LQH PSUs. Immediately prior to the spin-off, each ongoing Performance Period (as defined in the applicable LQH PSU grant notice) relating to each then-outstanding LQH PSU was terminated, and the LQH PSUs were bifurcated into (i) a number of LQH PSUs (expressed as a dollar value) calculated by multiplying (A) the target number of LQH PSUs (expressed as a dollar value) granted to the applicable holder by (B) a fraction, the numerator of which equaled the number of completed fiscal quarters between the commencement of the Performance Period applicable to such LQH PSU and the distribution date, and the denominator of which equaled the number of fiscal quarters in the Performance Period applicable to such LQH PSUs (the “Completed Period PSUs”), and (ii) a number of LQH PSUs (expressed as a dollar value) equal to the original target number of LQH PSUs awarded (expressed as a dollar value), less the number of corresponding Completed Period PSUs (expressed as a dollar value) (the “Remaining PSUs”).

Immediately prior to the spin-off, (i) a number of Completed Period PSUs (expressed as a dollar value) were deemed earned, based on the greater of (x) the level of achievement of applicable measures based on actual performance through the last completed fiscal quarter ending on or before the distribution date and (y) satisfaction of the applicable criteria at target levels, and (ii) a number of Remaining PSUs (expressed as a dollar value) were deemed earned based on satisfaction of the applicable criteria at target levels (in each case expressed as a dollar value and collectively, the “Banked PSUs”). Performance-based vesting with respect to the Banked PSUs was removed, and instead Banked PSUs will vest, subject to the holder’s continued employment with LQH or CorePoint, as applicable, through the last date of the original Performance Period to which such Banked PSUs relate. Any Completed Period PSU or Remaining PSU that was not earned as of the spin-off was forfeited without consideration as of such time.

Immediately prior to the spin-off, each Banked PSU were, by virtue of the spin-off, converted into a number of LQH RSAs equal to (i) the dollar value of such Banked PSU, divided by (ii) the Beginning Share Price (as such term is defined in the applicable LQH PSU grant notice) applicable to such Banked PSU, which LQH RSAs will be subject to the same vesting terms as the Banked PSU to which such LQH RSAs relate. Such converted LQH RSAs will be subject to the same treatment as set forth above with respect to LQH RSAs.

Continued Vesting. Following the spin-off, a grantee who has outstanding equity-based compensation awards under the LQH Incentive Plan and/or replacement equity-based compensation awards under our Omnibus Incentive Plan will be considered to have been employed by LQH or CorePoint, as applicable, prior to the spin-off, and to the extent such grantee continues to be employed by either LQH or CorePoint following the spin-off, after the spin-off, for purposes of (i) vesting and (ii) determining the date of termination of employment as it applies to any such award. Neither the transfer of employment to CorePoint nor the spin-off will constitute a “termination” under the LQH Incentive Plan.  The compensation expense related to the grants made under the LQH Incentive Plan and/or replacement equity-based compensation award for the employees of LQH post the spin-off date is incurred by LQH.  The compensation expense related to the grants made under the LQH Incentive Plan and/or replacement equity-based compensation award for the employees of CorePoint is incurred by CorePoint.  

For the three and six months ended June 30, 2018, we recognized $1 million and $2 million, respectively, of equity-based compensation expense in continuing operations. For the three and six months ended June 30, 2017, we recognized $2 million and $4 million, respectively, of equity-based compensation expense in continuing operations.

For the three and six months ended June 30, 2018, we recognized $1 million and $4 million, respectively, of equity-based compensation expense in discontinued operations. For the three and six months ended June 30, 2017, we recognized $2 million and $4 million, respectively, of equity-based compensation expense in discontinued operations.

The following table summarizes the activity of our RSAs during the six months ended June 30, 2018:

	Number of Shares			Weighted-Average Grant Date Fair Value
Unvested at January 1, 2018		512,117		$	25.90
Granted		633,241			27.89
Conversion of the performance units upon completion of the spin-off		423,510			27.92
Vested		(421,123	)		26.41
Forfeited		(5,737	)		27.45
Unvested at June 30, 2018		1,142,008		$	27.59

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Related Party Transactions

6 Months Ended

Jun. 30, 2018

Related Party Transactions [Abstract]

Related Party Transactions

NOTE 12. RELATED PARTY TRANSACTIONS

LQH Parent

As discussed in Note 3, CorePoint entered into the Separation and Distribution Agreement in January 2018 and entered into several other agreements with LQH Parent prior to consummation of the spin-off. These agreements set forth the principal transactions required to effect CorePoint Lodging’s separation from LQH and provide for the allocation between CorePoint and LQH Parent of various assets, liabilities, rights and obligations (including employee benefits, intellectual property, insurance and tax-related assets and liabilities) and govern the relationship between CorePoint Lodging and La Quinta after completion of the spin-off. These agreements also include arrangements with respect to transitional services to be provided by LQH Parent to CorePoint Lodging. In addition, prior to the spin-off, CorePoint Lodging entered into agreements, including long-term hotel management and franchise agreements for each of its hotels, with LQH that have either not existed historically, or that may be on different terms than the terms of the arrangement or agreements that existed prior to the spin-off.

In connection with the spin-off, CorePoint made the Cash Payment to LQH Parent of approximately $1.002 billion, immediately prior to and as a condition of the spin-off. The Cash Payment was to facilitate the repayment of part of LQH Parent’s existing debt. In addition, simultaneously with the closing of LQH Parent’s merger with a subsidiary of Wyndham Worldwide, Wyndham Worldwide repaid, or caused to be repaid, on behalf of LQH Parent, LQH Parent’s existing Term Facility.

Other Related Parties

Prior to April 14, 2014, LQH and predecessor entities were owned and controlled by Blackstone Real Estate Partners IV L.P. and affiliates (“BREP IV”) and Blackstone Real Estate Partners V L.P. and affiliates (“BREP V”). BREP IV and BREP V are affiliates of The Blackstone Group L.P. (collectivity, the “Funds” or “Blackstone”). As of June 30, 2018, Blackstone beneficially owned approximately 30.0% of our shares of common stock outstanding.  

As of June 30, 2018, approximately $518 million of the aggregate principal amount of our CMBS Facility was held by affiliates of Blackstone. As of December 31, 2017, approximately $82 million of the aggregate principal amount of LQH’s Term Facility was held by affiliates of Blackstone. In connection with the consummation of LQH Parent’s merger with a subsidiary of Wyndham Worldwide, on May 30, 2018, all outstanding amounts under LQH’s Term Facility were repaid in full.

We also purchase products and services from entities affiliated with or owned by Blackstone in the ordinary course of operating our business. The fees paid for these products and services were approximately $2 million during the three months ended June 30, 2017. The fees paid for these products and services were approximately $1 million and $2 million during the six months ended June 30, 2018 and 2017, respectively.

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Supplemental Disclosures of Cash Flow Information

6 Months Ended

Jun. 30, 2018

Supplemental Cash Flow Elements [Abstract]

Supplemental Disclosures of Cash Flow Information

NOTE 13. SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

Supplemental cash flow information for the six months ended June 30, 2018 and 2017 is summarized below:

	For the Six Months Ended June 30,
	2018		2017
	(in millions)
Supplemental cash flow information:
Interest paid during the period	$	54	$	39
Income taxes paid during the period, net of refunds		1		4
Supplemental non-cash disclosure:
Capital expenditures included in accounts payable		5		19
Cash flow hedge adjustment, net of tax		1		2
Receivable for capital assets damaged by casualty disasters		3		4

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Earnings Per Share

6 Months Ended

Jun. 30, 2018

Earnings Per Share [Abstract]

Earnings Per Share

NOTE 14. EARNINGS PER SHARE

Basic (loss) earnings per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of shares of common stock outstanding. Diluted earnings (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of shares of the Company’s common stock outstanding plus other potentially dilutive securities, except when the effect would be anti-dilutive. Dilutive securities include equity-based awards issued under long-term incentive plans, as discussed in Note 11.

The two-class method is an earnings allocation formula that determines EPS for each class of common stock and participating securities according to dividends or dividend equivalents and participation rights in undistributed earnings in periods when we have net income. The mandatorily redeemable preferred shares are considered participating securities and would be subject to the two-class method, as these shares have rights to earnings that otherwise would have been available to common shareholder.  The income from continuing operations would be impacted by the amount of dividends declared in the current period and the amount of any unpaid cumulative dividends.  As there was a loss for the three and six months ended June 30, 2018, the impact of the mandatorily redeemable preferred shares dividends would be anti-dilutive.

As described in Note 1, on May 30, 2018, LQH Parent stockholders of record as of 5:00 p.m. Eastern time, on May 18, 2018, received one share of CorePoint common stock for each share of LQH Parent common stock held after giving effect to the Reverse Stock Split. Basic and diluted net income (loss) per share for the three and six months ended June 30, 2018 is calculated using the weighted average number of basic, dilutive and anti-dilutive common shares outstanding during the periods, as adjusted for the one-to-two distribution ratio.

The following table sets forth the computation of basic and diluted earnings (loss) per share:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2018			2017			2018			2017
	(in millions, except per share data)
Numerator:
Income (loss) from Continuing Operations, net of tax	$	(28	)	$	19		$	(38	)	$	24
Loss on Discontinued Operations, net of tax		(20	)		(2	)		(25	)		(6	)
Net income (loss) attributable to CorePoint Lodging's      stockholders	$	(48	)	$	17		$	(63	)	$	18
Denominator:
Weighted average number of shares outstanding, basic		58.3			57.9			58.2			58.0
Weighted average number of shares outstanding, diluted		58.3			58.2			58.2			58.2
Basic and diluted earnings (loss) per share from continuing operations	$	(0.48	)	$	0.32		$	(0.65	)	$	0.41
Basic and diluted loss from discontinued operations		(0.34	)		(0.03	)		(0.43	)		(0.10	)
Basic and diluted (loss) earnings per share	$	(0.82	)	$	0.29		$	(1.08	)	$	0.31

For the three and six month periods ended June 30, 2018, approximately 0.7 million shares and 0.6 million shares, respectively, were excluded from the computation of diluted shares, as their impact would have been anti-dilutive.  For the three and six month periods ended June 30, 2017, approximately 0.4 million shares and 0.3 million shares, respectively, were excluded from the computation of diluted shares, as their impact would have been anti-dilutive.

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Subsequent Events

6 Months Ended

Jun. 30, 2018

Subsequent Events [Abstract]

Subsequent Events

NOTE 15. SUBSEQUENT EVENTS

On August 6, 2018, the Company announced that its Board of Directors declared a cash dividend of $0.067 per share of common stock with respect to the second quarter of 2018. This dividend is payable on September 14, 2018 to stockholders of record as of the close of business on August 30, 2018.

On August 2, 2018, we repaid the $25 million previously drawn on the Revolving Facility.

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Significant Accounting Policies and Recently Issued Accounting Standards (Policies)

6 Months Ended

Jun. 30, 2018

Accounting Policies [Abstract]

Our Spin-Off from La Quinta Holdings Inc.

Our Spin-Off from La Quinta Holdings Inc.

On January 18, 2017, La Quinta Holdings Inc., a Delaware corporation. (“LQH Parent,” and together with its consolidated subsidiaries, “LQH”) announced its intention to pursue the possibility of separating its real estate business from its franchise and management business, including the spin-off of its real estate ownership business into an independent, publicly traded company. The spin-off of CorePoint Lodging was made as part of a plan approved by LQH Parent’s board of directors to spin off LQH’s real estate business into a stand-alone, publicly traded company prior to the merger of LQH Parent with a wholly owned subsidiary of Wyndham Worldwide Corporation, a Delaware corporation (“Wyndham Worldwide”). The completion of the spin-off, followed by the completion of the merger, occurred on May 30, 2018. For additional discussion of the spin-off and related transactions, see Note 3.

Notwithstanding the legal form of the spin-off, for accounting and financial reporting purposes, LQH Parent is presented as being spun-off from CorePoint (a “reverse spin”). This presentation is in accordance with generally accepted accounting principles in the U.S. (“GAAP”), specifically Financial Account Standards Board (“FASB”) statement “Spinoff and Reverse Spinoffs”, and is primarily a result of the relative significance of CorePoint’s business to LQH’s business, as measured in terms of revenues, profits, and assets. Therefore, CorePoint Lodging Inc. is considered the divesting entity and treated as the “accounting successor,” and LQH Parent is the “accounting spinnee” and “accounting predecessor” for consolidated financial reporting purposes.

In accordance with FASB statement “Presentation of Financial Statements – Discontinued Operations”, effective with the closing of the spin-off on May 30, 2018, the results of operations related to LQH Parent’s hotel franchise and hotel management business are reported as discontinued operations for all periods presented. In addition, the assets and liabilities of LQH Parent’s hotel franchise and hotel management business have been segregated from the assets and liabilities related to the Company’s continuing operations and presented separately on the Company’s comparative balance sheet as of December 31, 2017. Unless otherwise noted, all disclosures in the notes accompanying the unaudited consolidated financial statements reflect only continuing operations.

Interim Unaudited Financial Information

Interim Unaudited Financial Information

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP for interim financial information, the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information or footnotes required by GAAP for complete annual financial statements. Although we believe the disclosures made are adequate to prevent the information presented from being misleading, these financial statements should be read in conjunction with LQH’s consolidated financial statements and notes thereto for the years ended December 31, 2017, 2016 and 2015, which are included in our Information Statement filed as Exhibit 99.1 to our Registration Statement on Form 10 (the “Form 10”), which the Securities and Exchange Commission (the “SEC”)  declared effective on May 8, 2018.

Subsequent to May 30, 2018, the accompanying unaudited condensed consolidated financial statements include the accounts of the Company. The historical unaudited condensed consolidated financial statements through May 30, 2018 represent the financial position and results of operations of entities that have historically been under common control of the accounting predecessor, LQH Parent.

The results for the interim periods shown in this report are not necessarily indicative of future financial results. The accompanying condensed consolidated balance sheet as of June 30, 2018 and condensed consolidated statements of operations, comprehensive income, cash flows and equity for the periods ended June 30, 2018 and 2017 have not been audited by our independent registered public accounting firm. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, including normal recurring items, necessary to present fairly our consolidated financial position as of June 30, 2018 and December 31, 2017, and our consolidated results of operations and cash flows for the periods ended June 30, 2018 and 2017.

The accompanying condensed consolidated financial statements include the accounts of the Company, as well as its wholly-owned subsidiaries and any consolidated variable interest entities (“VIEs”).  We recognize noncontrolling interests for the proportionate share of operations for ownership interests not held by our shareholders. All intercompany transactions have been eliminated.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.

Reclassifications

Reclassifications

Certain line items on the condensed consolidated balance sheet as of December 31, 2017 and the condensed consolidated statements of operations for the three and six months ended June 30, 2017 have been reclassified to conform to the current period presentation. These reclassifications had no impact on our net income (loss) or financial position and were made in order to conform to presentations consistent with other REIT peers and reflect the results of discontinued operations. See Note 3 for additional information.

Investment in Real Estate

Investment in Real Estate

Property and equipment are stated at cost less accumulated depreciation computed using a straight-line method over the estimated useful life of each asset. Property and equipment consists of the following, along with associated estimated useful lives:

Buildings and improvements	5 to 40 years
Furniture, fixtures and other equipment	2 to 10 years

We periodically review the useful lives of our long-lived assets based on current assessments of the remaining utility of our assets. Such changes are accounted for prospectively and would either increase or decrease depreciation expense in the accompanying condensed consolidated statements of operations.

We capitalize expenditures that increase the overall value of an asset or extend an asset’s life, typically associated with hotel refurbishment, renovation, and major repairs. Such costs primarily include third party contract labor, professional design and construction costs, including associated materials, and other direct and indirect costs, such as sales and use tax and interest costs, incurred during the redevelopment and renovation period. The capitalization period begins when the activities related to development have begun and ceases when the project is substantially complete and the assets are held available for use or occupancy. Once a redevelopment project is substantially complete and the associated assets are ready for intended use, costs related to the redevelopment project are no longer capitalized.

Normal maintenance and repair costs are expensed as incurred. When depreciable property is retired or disposed, the related cost and accumulated depreciation or amortization is removed from theapplicable accounts and any gain or loss is reflected in the accompanying statements of operations.  

Impairment of Real Estate Related Assets

Impairment of Real Estate Related Assets

If events or circumstances indicate that the carrying amount of a property may not be recoverable, we make an assessment of the property’s recoverability by comparing the carrying amount of the asset to our estimate of the aggregate undiscounted future operating cash flows expected to be generated over the holding period of the asset including its eventual disposition.  If the carrying amount exceeds the aggregate undiscounted future operating cash flows, we recognize an impairment loss to the extent the carrying amount exceeds the estimated fair value of the property. 

We did not record any impairment loss for the three and six months ended June 30, 2018 and 2017.

Assets Held for Sale

Assets Held for Sale

For sales of real estate or assets classified as held for sale, we evaluate whether the disposition will have a major effect on our operations and financial results and will therefore qualify as a strategic shift. If the disposition represents a strategic shift, it will be classified as discontinued operations in our consolidated statements of operations for all periods presented. If the disposition does not represent a strategic shift, it will be presented in continuing operations in our consolidated statements of operations.

We classify hotels as held for sale when certain criteria are met, in accordance with GAAP. At that time, we present the assets and obligations associated with the real estate held for sale separately in our consolidated balance sheet, and we cease recording depreciation and amortization expense related to that asset. Real estate held for sale is reported at the lower of its carrying amount or its estimated fair value less estimated costs to sell.

As of June 30, 2018 and December 31, 2017, we had two and three hotels held for sale, respectively.

Cash and Cash Equivalents

Cash and Cash EquivalentsWe consider all cash on hand, demand deposits with financial institutions, and short-term highly liquid investments with original maturities of three months or less to be cash equivalents. Cash and cash equivalents consist of highly liquid investments that are stated at cost, which approximates fair market value. Certain balances in cash and cash equivalents exceed the Federal Deposit Insurance Corporation limit of $250,000; however, we believe credit risk related to these deposits is minimal.

Accounts Receivable

Accounts Receivable

Accounts receivable primarily consists of receivables due from hotel guests, credit card companies and insurance settlements. Accounts receivable are carried at estimated collectable amounts. We periodically evaluate our receivables for collectability based on historical experience, the length of time receivables are past due, and the general economy. We provide an allowance for doubtful accounts, after considering factors that might affect the collection of accounts receivable, including historical losses and the ability of the party to meet its obligations to us.

Deferred Debt Issuance Costs

Deferred Debt Issuance Costs

Deferred debt issuance costs include legal and bank issuance costs incurred in connection with issuance of debt, including costs associated with the issuance of our credit facilities, and are presented as a direct reduction from the carrying amount of debt. These debt issuance costs are deferred and amortized to expense over the term of the debt and are included as a component of interest expense. When debt is paid prior to its scheduled maturity date or the underlying terms are materially modified, the remaining carrying value of deferred debt issuance costs, along with certain other payments to lenders, is included in loss on early extinguishment of debt.

Fair Value Measurements

Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or pay to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. In evaluating the fair value of both financial and non-financial assets and liabilities, we use the accounting guidance that establishes a fair value hierarchy, which prioritizes the inputs used in measuring fair value into three broad levels, which are as follows:

• Level 1—Quoted prices in active markets for identical assets or liabilities.

• Level 2—Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Valuations in this category are inherently less reliable than quoted market prices due to the degree of subjectivity involved in determining appropriate methodologies and the applicable underlying observable market assumptions.

• Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. These inputs cannot be validated by readily determinable market data and generally involve considerable judgment by management.

We use the highest level of observable market data if such data is available without undue cost and effort.

Derivative Instruments

Derivative Instruments

We use derivative instruments as part of our overall strategy to manage our exposure to market risks associated with fluctuations in interest rates. We regularly monitor the financial stability and credit standing of the counterparties to our derivative instruments. We do not enter into derivative financial instruments for trading or speculative purposes.

We record all derivatives at fair value. On the date the derivative contract is entered, we designate the derivative as one of the following: a hedge of a forecasted transaction or the variability of cash flows to be paid (“cash flow hedge”), a hedge of the fair value of a recognized asset or liability (“fair value hedge”), or an undesignated hedge instrument. Changes in the fair value of a derivative that is qualified, designated and highly effective as a cash flow hedge or net investment hedge are recorded in the condensed consolidated statements of comprehensive income (loss) until they are reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Changes in the fair value of a derivative that is qualified, designated and highly effective as a fair value hedge, along with the gain or loss on the hedged asset or liability that is attributable to the hedged risk, are recorded in current period earnings. Cash flows from designated derivative financial instruments are classified within the same category as the item being hedged in the condensed consolidated statements of cash flows.

On a quarterly basis, we assess the effectiveness of our designated hedges in offsetting the variability in the cash flows or fair values of the hedged assets or obligations via use of a statistical regression and hypothetical derivative approach. We discontinue hedge accounting prospectively when the derivative is not highly effective as a hedge, the underlying hedged transaction is no longer probable, or the hedging instrument expires, is sold, terminated or exercised.

Revenue Recognition

Revenue Recognition

We adopted Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers, effective January 1, 2018 using the modified retrospective transition method. The information in this section describes our current revenue recognition policies. See “Newly Adopted Accounting Standards” below for additional information related to the adoption.

Our revenues primarily consist of operating lease revenues from room rentals, and, to a lesser extent, restaurants, billboards and cell towers, which are accounted for under GAAP in accordance with lease accounting standards. Room revenue is recognized as earned on a daily basis, net of customer incentive discounts, cash rebates, and refunds.  Revenue related to operating leases with a term in excess of one year are recognized on a straight-line basis over the life of the respective lease agreement.  

Other revenues include revenues generated by the incidental support of hotel operations for hotels and are recognized under the revenue accounting standard as the service obligation is completed.

Equity-Based Compensation

Equity-Based Compensation

We have a stock-based incentive award plan for our employees and directors. Stock-based compensation expense associated with these awards is recognized in general and administrative expenses in our consolidated statements of operations. We measure stock-based compensation at the estimated fair value on the grant date and recognize the amortization of stock-based compensation expense over the requisite service period. Fair value is determined based on grant date fair value.  We recognize forfeitures as they occur.

Income Taxes

Income Taxes

We are organized in conformity with, and operate in a manner that will allow us to elect to be taxed as, a REIT, for U.S. federal income tax purposes beginning with our tax year ending December 31, 2018 and we expect to continue to be organized and operate so as to qualify as a REIT. To qualify as a REIT, we must continually satisfy requirements related to, among other things, the real estate qualification of sources of our income, the real estate composition and values of our assets, the amounts we distribute to our stockholders annually and the diversity of ownership of our stock. To the extent we qualify as a REIT, we generally will not be subject to U.S. federal income tax on taxable income generated by our REIT activities that we distribute to our stockholders. Accordingly, no provision for U.S. federal income taxes has been included in our accompanying condensed consolidated financial statements for purposes of determining the annualized effective tax rate applied to the six months ended June 30, 2018 related to our REIT activities.

We are, and will continue to be, subject to U.S. federal income tax on taxable sales of built-in gain property (representing property with an excess of fair value over tax basis held by us on May 30, 2018) during the five-year period following our election to be taxed as a REIT. In addition, we may be subject to state and local taxes and non-U.S. income tax on foreign held REIT activities. Further, our taxable REIT subsidiaries are generally subject to U.S. federal, state and local, and foreign income taxes (as applicable).

Through May 30, 2018, LQH Parent will file a federal income tax return, as well as certain state tax returns where we filed on a combined basis, and foreign tax filings, as applicable.

On December 22, 2017, the Tax Cuts and Jobs Act (the “Tax Act”) was enacted into law. The Tax Act contains several key tax provisions that affected us, including a reduction of the corporate income tax rate to 21% effective January 1, 2018, among others. We are required to recognize the effect of the tax law changes in the period of enactment, such as re-measuring our U.S. deferred tax assets and liabilities as well as reassessing the net realizability of our deferred tax assets and liabilities. In December 2017, the SEC staff issued Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (SAB 118), which allows us to record provisional amounts during a measurement period not to extend beyond one year of the enactment date. Since the Tax Act was passed late in the fourth quarter of 2017, and ongoing guidance and accounting interpretation is expected over the next 12 months, we consider the deferred tax re-measurements and other items to be incomplete due to the forthcoming guidance and our ongoing analysis of final year-end data and tax positions. We expect to complete our analysis within the one year measurement period permitted by SAB 118.

Concentrations of Credit Risk and Business Risk

Concentrations of Credit Risk and Business Risk

Financial instruments, which potentially subject us to concentrations of credit risk, consist principally of cash and cash equivalents. We utilize financial institutions that we consider to be of high credit quality and consider the risk of default to be minimal. We also monitor the credit-worthiness of our customers and financial institutions before extending credit or making investments.

Lodging operations are particularly sensitive to adverse economic and competitive conditions and trends, which could adversely affect the Company’s business, financial condition, and results of operations.

Geographic concentrations, which potentially subject us to concentrations of business risk, relate primarily to locations of hotels and the revenue recognized in various states within the U.S. We have a concentration of hotels operating in Texas, Florida and California.

The percentages of our total revenues, excluding revenue from discontinued operations, from these states for the six months ended June 30, 2018 and 2017 are as follows:

	For the six months ended
	June 30, 2018			June 30, 2017
Texas		23	%		21	%
Florida		15	%		19	%
California		10	%		10	%
Total		48	%		50	%

Segment Reporting

Segment Reporting

Our hotels have similar economic characteristics and customers across all geographic locations, and our service offerings and delivery of services are provided in a similar manner, using the same types of facilities and similar technologies. Our chief operating decision maker, the Company's Chief Executive Officer, reviews our financial information on an aggregated basis. As a result, we have concluded that we have one reportable business segment.

Principal Components of Expenses

Principal Components of Expenses

Rooms — These expenses include hotel expenses of housekeeping, reservation systems, room and breakfast supplies and front desk costs.

Other departmental and support— These expenses include labor and other expenses that constitute non-room operating expenses, including parking, telecommunications, on-site administrative departments, sales and marketing, recurring repairs and maintenance and utility expenses.

Property tax, insurance and other— These expenses consist primarily of real and personal property taxes, other local taxes, ground rent, equipment rent and insurance.

Management and royalty fees — Management fees represent fees paid to third parties and are computed as a percentage of gross revenue.  Royalty fees are generally computed as a percentage of rooms revenues. In connection with the spin-off, we entered into new management and franchise agreements, refer to Note 9, “Commitments and Contingencies” for additional information.

Corporate general and administrative — These expenses include off-site general and administrative expenses, consisting primarily of compensation, contract labor expense for our corporate staff, professional fees, travel expenses, and office administrative and related expenses.  

Other, net — These expenses include losses incurred resulting from property damage or destruction caused by any sudden, unexpected or unusual event such as a hurricane. Impairment losses are non-cash expenses that are recognized when circumstances indicate that the carrying value of a long-lived asset is not recoverable. An impairment loss is recognized for the excess of the carrying value over the fair value of the asset.

Newly Issued and Adopted Accounting Standards

Newly Issued Accounting Standards

In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements. This guidance updates ASU 2016-02 Leases and provides entities an additional, optional transition method of initially applying the new lease standard at the adoption date and recognizing cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption, with comparative periods continuing to be presented in accordance with current GAAP. Previously, ASU 2018-02 required the new standard to be adopted on a modified retrospective basis. The Company is currently evaluating which option to elect.

In June 2018, the FASB issued ASU 2018-07, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income, which simplifies the accounting for share-based payments granted to nonemployees for goods and services. Under this ASU, most of the guidance on such payments to nonemployees would be aligned with the requirements for share-based payments granted to employees. The Company accounts for its share-based payments to members of its board of directors in the same manner as share-based payments to its employees. Other than to members of our board of directors, the Company does not award share-based payments to any nonemployees. The guidance is effective for periods beginning after December 15, 2018. Early adoption is allowed.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which changes the methodology for measuring credit losses on financial instruments and the timing of when such losses are recorded. The guidance affects entities holding financial assets and net investment in leases that are not accounted for at fair value through net income. The guidance will apply to our trade receivables, notes receivable, net investments in leases and any other future financial assets that have the contractual right to receive cash that we may acquire in the future. The guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019. Early adoption is permitted for fiscal years, and interim periods within those years, beginning after December 15, 2018. Historically, credit losses have not been material to the Company. We are currently evaluating the impact of this guidance on our financial position, results of operations and related disclosures but do not expect the implementation of this guidance to have a material impact on our condensed consolidated financial position and results of operations.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), regarding the accounting for leases for both lessees and lessors. In July 2018, ASU 2016-02 was amended, providing another transition method by allowing companies to initially apply the new lease standard in the year of adoption and not the earliest comparative period. The lease standard amendment also provided a practical expedient for an accounting policy election for lessors, by class of underlying asset, to not separate nonlease components from the associated lease components, similar to the practical expedient provided for lessees. The lessor practical expedient is only available if the timing and pattern of transfer are the same for the nonlease and lease components and the lease components, if accounted for separately, would be classified as an operating lease.

Lessees will need to recognize on their balance sheet a right-of-use asset and a lease liability for virtually all of their leases (other than leases that meet the definition of a short-term lease). The liability will be equal to the present value of lease payments. The asset will be based on the liability, adjusted for any initial direct costs of the lease, lease incentives or early lease payments, where applicable. For income statement purposes, the FASB retained a dual model, requiring leases to be classified as either operating or finance. Operating leases will result in straight-line rent expense (similar to current operating leases) while finance leases will result in interest and amortization expense (similar to current capital leases). Classification will be based on criteria that are largely similar to those applied in current lease accounting. The new standard may be adopted using a modified retrospective transition and provides for certain practical expedients. We are evaluating the impact of ASU 2016-02 on our consolidated financial statements, where we believe the primary impact as a lessee will relate to leases where we are the ground lessee.

Under current lessor accounting, a real estate lease could only be a sales-type lease if ownership of the real estate was transferred to the lessee. With the adoption of ASU 2016-02, there will no longer be an exclusion for real estate leases, where the same classification guidance applies as with all other leases. We are currently evaluating how this guidance would apply to lessor classification. If, as lessor, our real estate leases would be classified as sales-type leases, the real estate asset would be eliminated, a net investment asset would be recognized generally equal to the present value of the minimum lease payments plus the unguaranteed residual value and a selling profit or loss recorded. Additionally, only incremental direct leasing costs may be capitalized under this new guidance, which is primarily consistent with the Company’s existing policies.

In light of the recently issued lease standard amendment and the new practical expedients, we continue to evaluate the impact of the new leasing standard. We plan to adopt the new standard effective January 1, 2019.

Newly Adopted Accounting Standards

Effective January 1, 2018, we adopted FASB Topic 606. The revised guidance outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and superseded prior revenue recognition guidance, including industry-specific revenue guidance.  The revised guidance replaced most existing revenue and real estate sale recognition guidance in GAAP. The standard specifically excludes lease contracts, which is our primary recurring revenue source; however, our revenue accounting for incidental hotel revenue will follow the revised guidance. We adopted the new standard using the modified retrospective transition method, where financial statement presentations prior to the date of adoption are not adjusted. Transactions that were not closed as of the adoption date were adjusted to reflect the new standard where we recorded a net reduction to opening retained earnings of approximately $15 million, net of tax, as of January 1, 2018 due to the cumulative impact of adopting ASC 606, which relates primarily to our discontinued operations.

Effective January 1, 2018, we adopted FASB ASU 2017-05, which requires the derecognition of a business in accordance with ASC 810, Consolidations, including instances in which the business is considered in substance real estate. In cases where a controlling interest in real estate was sold but a noncontrolling interest is retained, we may record a gain or loss related to both the sold and retained interests. The adoption of this standard did not have an impact on our condensed consolidated financial statements, but depending on future transactions, may in the future.

Effective January 1, 2018, we adopted FASB ASU 2018-05, Income Taxes (Topic 740) - Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118, which provides guidance from the SEC allowing for the recognition of provisional amounts in the financial statements as a result of the Tax Act that was signed into law in December 2017. The guidance allows for a measurement period of up to one year from the enactment date to finalize the accounting related to the Tax Act. The Company has applied and continues to apply the guidance in this update within its financial statements.

Effective January 1, 2018, we adopted FASB ASU 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220). The guidance in ASU 2018-02 allows an entity to elect to reclassify the stranded tax effects related to the Tax Act from accumulated other comprehensive income into retained earnings. The adoption of this statement did not have a material effect on our financial statements.

Effective January 1, 2018, we adopted FASB ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting. This update clarifies the changes to terms or conditions of a share-based payment award that require an entity to apply modification accounting. The adoption of this statement did not have a material effect on our financial statements.

Effective January 1, 2018 we adopted FASB ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business, which provides guidance for evaluating whether certain transactions are to be accounted for as an acquisition (or disposal) of either a business or an asset. This standard is applied on a prospective basis.  The adoption of this statement did not have a material effect on our financial statements.

From time to time, new accounting standards are issued by FASB or other standards setting bodies, which we adopt as of the specified effective date. Unless otherwise discussed, we believe the impact of recently issued standards that are not yet effective will not have a material impact on our consolidated financial statements upon adoption.

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Significant Accounting Policies and Recently Issued Accounting Standards (Tables)

6 Months Ended

Jun. 30, 2018

Accounting Policies [Abstract]

Property and Equipment Estimated Useful Life

Property and equipment consists of the following, along with associated estimated useful lives:

Buildings and improvements	5 to 40 years
Furniture, fixtures and other equipment	2 to 10 years

Summary of Percentages of Total Revenues Excluding Revenue from Discontinued Operations

The percentages of our total revenues, excluding revenue from discontinued operations, from these states for the six months ended June 30, 2018 and 2017 are as follows:

	For the six months ended
	June 30, 2018			June 30, 2017
Texas		23	%		21	%
Florida		15	%		19	%
California		10	%		10	%
Total		48	%		50	%

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Discontinued Operations (Tables)

6 Months Ended

Jun. 30, 2018

Discontinued Operations And Disposal Groups [Abstract]

Summary of Hotel Franchise and Hotel Management Business Presented as Discontinued Operations

The following table summarizes the results of the hotel franchise and hotel management business which are presented as discontinued operations (in millions).

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2018			2017			2018			2017
Revenues	$	25		$	38		$	58		$	69
OPERATING EXPENSES
General, administrative and marketing		36			30			64			58
Depreciation and amortization		2			2			4			4
Total Operating Expenses		38			32			68			62
Operating Income (Loss)		(13	)		6			(10	)		7
OTHER EXPENSES:
Interest expense		(6	)		(9	)		(15	)		(17	)
Loss on extinguishment of debt		(7	)		—			(7	)		—
Total Other Expenses		(13	)		(9	)		(22	)		(17	)
Loss Before Income Taxes		(26	)		(3	)		(32	)		(10	)
Income tax benefit		6			1			7			4
Loss from Discontinued Operations, net of tax	$	(20	)	$	(2	)	$	(25	)	$	(6	)

Summary of Carrying Amounts of Major Classes of Assets and Liabilities Included in Discontinued Operations

The following table presents the carrying amounts of the major classes of assets and liabilities of LQH Parent that were included in discontinued operations as of December 31, 2017:

	December 31, 2017
	(in millions)
ASSETS
Assets:
Total real estate, net	$	49
Intangible assets, net of accumulated amortization		171
Accounts receivable		24
Other assets		36
Total Assets	$	280
LIABILITIES AND EQUITY
Liabilities:
Debt, net	$	696
Accounts payable and accrued expenses		109
Other liabilities		21
Deferred tax liabilities		20
Total Liabilities	$	846

Summary of Selected Financial Information of LQH Parent Included in Condensed Consolidated Statements of Cash Flows

As such, the following table presents selected financial information of LQH Parent included in the condensed consolidated statements of cash flows:

	For the Six months ended June 30,
	June 30, 2018		June 30, 2017
	(in millions)
Non-cash items included in net income (loss):
Depreciation and amortization	$	4	$	4
Amortization of deferred costs		1		1
Loss on extinguishment of debt		7		—
Equity based compensation expense		4		4
Investing activities:
Capital expenditures	$	11	$	12

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Other Assets (Tables)

6 Months Ended

Jun. 30, 2018

Other Assets [Abstract]

Schedule of Other Assets

Other assets include the following as of June 30, 2018 and December 31, 2017:

	June 30, 2018		December 31, 2017
	(in millions)
Assets held for sale	$	5	$	9
Lenders escrow		15		—
Intangible assets		5		5
Other assets		30		18
Total other assets	$	55	$	32

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Debt (Tables)

6 Months Ended

Jun. 30, 2018

Debt Disclosure [Abstract]

Schedule of Long-Term Debt

Debt as of June 30, 2018 and December 31, 2017 was as follows:

	June 30, 2018			December 31, 2017
	(in millions)
CMBS Facility	$	1,035		$	—
Revolving Facility		25			—
Term Facility		—			1,003
		1,060			1,003
Less deferred debt issuance costs and original issue discount		(28	)		(11	)
Total debt, net (1)	$	1,032		$	992

⁽¹⁾ As of June 30, 2018 and December 31, 2017, the 30 day United States dollar London Interbank Offering Rate (“LIBOR”) was 2.09% and 1.56%, respectively. As of June 30, 2018, the interest rate, maturity date and principal payments on the CMBS Facility (as defined below) and Term Facility (defined below) were as follows:

• The interest rate for the CMBS Facility through June 30, 2018 was LIBOR with a floor of 0.0% plus a spread of 2.75%. Interest expense on the CMBS Facility for the three and six months ended June 30, 2018 was approximately $6 million. Included in the CMBS Facility, as of June 30, 2018 is the deduction of debt issuance costs of $28 million, net of amortization. As of June 30, 2018, we had $5 million in accrued interest included within accounts payable and accrued expenses in the accompanying condensed consolidated balance sheet.

• The interest rate for the Revolving Facility is, at the option of the CorePoint Revolver Borrower, either at a base rate plus a margin of 3.5% or LIBOR rate plus a margin of 4.5%.

• In connection with the consummation of the merger, on May 30, 2018, all outstanding amounts under the Term Facility were repaid in full.

• The interest rate for the Term Facility from January 1, 2018 to March 6, 2018, was LIBOR with a floor of 1.0% plus a spread of 2.75%. As of March 6, 2018, the rate increased to LIBOR with a floor of 1.0% plus a spread of 3.0% for the period from March 6, 2018 to May 30, 2018. Included in the Term Facility as of December 31, 2017 is an unamortized original issue discount of $3 million. Interest expense on the Term Facility for the three and six months ended June 30, 2018 was approximately $8 million and $19 million, respectively. Interest expense on the Term Facility for the three and six months ended June 30, 2017 was approximately $10 million and $21 million, respectively. Included in the Term Facility, as of December 31 ,2017 is the deduction of debt issuance costs of $8 million, net of amortization. As of December 31, 2017, we had $9 million in accrued interest included within accounts payable and accrued expenses in the accompanying condensed consolidated balance sheets.

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Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2018

Fair Value Disclosures [Abstract]

Carrying Amount and Estimated Fair Values of Financial Assets and Liabilities

The carrying amount and estimated fair values of our financial assets and liabilities were as follows:

	June 30, 2018				December 31, 2017
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
	(in millions)
Debt - CMBS Facility(1)(2)	$	1,007	$	1,007	$	—	$	—
Debt - Revolver(1)		25		25		—		—
Interest rate caps (3)		1		1		—		—
Debt - Term Facility(1)(4)(2)		—		—		992		1,007
Interest rate swaps (3)		—		—		1		1
Mandatorily redeemable preferred shares(1)		15		15		—		—

⁽¹⁾ Classified as Level 3 under the fair value hierarchy.

⁽²⁾ Carrying amount includes deferred debt issuance costs of $28 million as of June 30, 2018.

⁽³⁾ Classified as Level 2 under the fair value hierarchy.

⁽⁴⁾ Carrying amount includes deferred debt issuance costs of $14 million as of December 31, 2017.

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Equity-Based Compensation (Tables)

6 Months Ended

Jun. 30, 2018

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Summary of Activity of RSAs

The following table summarizes the activity of our RSAs during the six months ended June 30, 2018:

	Number of Shares			Weighted-Average Grant Date Fair Value
Unvested at January 1, 2018		512,117		$	25.90
Granted		633,241			27.89
Conversion of the performance units upon completion of the spin-off		423,510			27.92
Vested		(421,123	)		26.41
Forfeited		(5,737	)		27.45
Unvested at June 30, 2018		1,142,008		$	27.59

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Supplemental Disclosures of Cash Flow Information (Tables)

6 Months Ended

Jun. 30, 2018

Supplemental Cash Flow Elements [Abstract]

Summary of Supplemental Cash Flow Information

Supplemental cash flow information for the six months ended June 30, 2018 and 2017 is summarized below:

	For the Six Months Ended June 30,
	2018		2017
	(in millions)
Supplemental cash flow information:
Interest paid during the period	$	54	$	39
Income taxes paid during the period, net of refunds		1		4
Supplemental non-cash disclosure:
Capital expenditures included in accounts payable		5		19
Cash flow hedge adjustment, net of tax		1		2
Receivable for capital assets damaged by casualty disasters		3		4

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Earnings Per Share (Tables)

6 Months Ended

Jun. 30, 2018

Earnings Per Share [Abstract]

Reconciliation of Numerators and Denominators Used for Computation of Basic and Diluted (Loss) Earnings Per Share

The following table sets forth the computation of basic and diluted earnings (loss) per share:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2018			2017			2018			2017
	(in millions, except per share data)
Numerator:
Income (loss) from Continuing Operations, net of tax	$	(28	)	$	19		$	(38	)	$	24
Loss on Discontinued Operations, net of tax		(20	)		(2	)		(25	)		(6	)
Net income (loss) attributable to CorePoint Lodging's      stockholders	$	(48	)	$	17		$	(63	)	$	18
Denominator:
Weighted average number of shares outstanding, basic		58.3			57.9			58.2			58.0
Weighted average number of shares outstanding, diluted		58.3			58.2			58.2			58.2
Basic and diluted earnings (loss) per share from continuing operations	$	(0.48	)	$	0.32		$	(0.65	)	$	0.41
Basic and diluted loss from discontinued operations		(0.34	)		(0.03	)		(0.43	)		(0.10	)
Basic and diluted (loss) earnings per share	$	(0.82	)	$	0.29		$	(1.08	)	$	0.31

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Organization and Basis of Presentation - Summary of Number of Owned and Joint Venture Hotels (Detail)	Jun. 30, 2018 Hotel Room	Dec. 31, 2017 Hotel Room
Real Estate Properties [Line Items]
Number of hotels | Hotel	316	317
Number of rooms | Room	40,500	40,600
Owned [Member]
Real Estate Properties [Line Items]
Number of hotels | Hotel	315	316
Number of rooms | Room	40,300	40,400
Joint Venture [Member]
Real Estate Properties [Line Items]
Number of hotels | Hotel	1	1
Number of rooms | Room	200	200

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Organization and Basis of Presentation - Summary of Number of Owned and Joint Venture Hotels (Parenthetical) (Detail) - Hotel	6 Months Ended	12 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Number of hotels held for sale	2	3

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Organization and Basis of Presentation - Additional Information (Detail)	6 Months Ended
	Jun. 30, 2018
Organization Consolidation And Presentation Of Financial Statements [Abstract]
Spin-off date	May 30, 2018

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Significant Accounting Policies and Recently Issued Accounting Standards - Summary of Property and Equipment (Detail)	6 Months Ended
	Jun. 30, 2018
Buildings and Improvements [Member] | Minimum [Member]
Summary Of Significant Accounting Policies [Line Items]
Property and equipment, estimated useful life	5 years
Buildings and Improvements [Member] | Maximum [Member]
Summary Of Significant Accounting Policies [Line Items]
Property and equipment, estimated useful life	40 years
Furniture, Fixtures and Other Equipment [Member] | Minimum [Member]
Summary Of Significant Accounting Policies [Line Items]
Property and equipment, estimated useful life	2 years
Furniture, Fixtures and Other Equipment [Member] | Maximum [Member]
Summary Of Significant Accounting Policies [Line Items]
Property and equipment, estimated useful life	10 years

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Significant Accounting Policies and Recently Issued Accounting Standards - Additional Information (Detail)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2018 USD ($)	Jun. 30, 2017 USD ($)	Jun. 30, 2018 USD ($) Hotel Segment	Jun. 30, 2017 USD ($)	Dec. 31, 2017 Hotel	Jan. 01, 2018 USD ($)
Summary Of Significant Accounting Policies [Line Items]
Loss on impairment of real estate assets	$ 0	$ 0	$ 0	$ 0
Number of hotels held for sale | Hotel			2		3
Federal Deposit Insurance Corporation limit	250,000		$ 250,000
Income tax provision (benefits)	$ 2,000,000	$ 14,000,000	$ 1,000,000	$ 19,000,000
Corporate income tax rate	21.00%	35.00%	21.00%	35.00%
Number of reportable business segment | Segment			1
Accounting Standards Update 2014-09 [Member] | Difference between Revenue Guidance in Effect before and after Topic 606 [Member]
Summary Of Significant Accounting Policies [Line Items]
Decrease in retained earnings						$ (15,000,000)
REIT [Member]
Summary Of Significant Accounting Policies [Line Items]
Income tax provision (benefits)			$ 0

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Significant Accounting Policies and Recently Issued Accounting Standards - Summary of Percentages of Total Revenues Excluding Revenue from Discontinued Operations (Detail)	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Summary Of Significant Accounting Policies [Line Items]
Percentages of revenues	48.00%	50.00%
Texas
Summary Of Significant Accounting Policies [Line Items]
Percentages of revenues	23.00%	21.00%
Florida
Summary Of Significant Accounting Policies [Line Items]
Percentages of revenues	15.00%	19.00%
California
Summary Of Significant Accounting Policies [Line Items]
Percentages of revenues	10.00%	10.00%

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Discontinued Operations - Additional Information (Detail) - USD ($)		6 Months Ended
	May 30, 2018	Jun. 30, 2018	Dec. 31, 2017
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]
Stockholders' equity, reverse stock split		On May 18, 2018, received one share of CorePoint common stock for each share of LQH Parent common stock held after giving effect to the Reverse Stock Split.
Common Stock, par value	$ 0.01	$ 0.01	$ 0.01
LQH Parent [Member]
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]
Stockholders' equity, reverse stock split		Each holder of LQH Parent common stock received one share of CorePoint common stock for each share of LQH Parent common stock.
Common Stock, par value	0.02
Disposal group including discontinued operation merger consideration per share	$ 16.80
Disposal group including discontinued operation, consideration, repayment of debt	$ 715,000,000
Disposal group including discontinued operation, reserve for estimated taxes	$ 240,000,000	$ 240,000,000
Gain or loss on separation of disposed net assets and liabilities		0
Adjustment in stockholders’ equity		746,000,000
Cash payment in connection with spin-off		$ 1,002,000,000

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Discontinued Operations - Summary of Hotel Franchise and Hotel Management Business Presented as Discontinued Operations (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
OTHER EXPENSES:
Loss on extinguishment of debt	$ (10)		$ (10)
Loss from Discontinued Operations, net of tax	(20)	$ (2)	(25)	$ (6)
Discontinued Operations [Member]
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items]
Revenues	25	38	58	69
OPERATING EXPENSES
General, administrative and marketing	36	30	64	58
Depreciation and amortization	2	2	4	4
Total Operating Expenses	38	32	68	62
Operating Income (Loss)	(13)	6	(10)	7
OTHER EXPENSES:
Interest expense	(6)	(9)	(15)	(17)
Loss on extinguishment of debt	(7)		(7)
Total Other Expenses	(13)	(9)	(22)	(17)
Loss Before Income Taxes	(26)	(3)	(32)	(10)
Income tax benefit	6	1	7	4
Loss from Discontinued Operations, net of tax	$ (20)	$ (2)	$ (25)	$ (6)

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Discontinued Operations - Summary of Carrying Amounts of Major Classes of Assets and Liabilities Included in Discontinued Operations (Detail) $ in Millions	Dec. 31, 2017 USD ($)
Assets:
Total Assets	$ 280
Liabilities:
Total Liabilities	846
LQH Parent [Member] | Discontinued Operations [Member]
Assets:
Total real estate, net	49
Intangible assets, net of accumulated amortization	171
Accounts receivable	24
Other assets	36
Total Assets	280
Liabilities:
Debt, net	696
Accounts payable and accrued expenses	109
Other liabilities	21
Deferred tax liabilities	20
Total Liabilities	$ 846

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Discontinued Operations - Summary of Selected Financial Information of LQH Parent Included in Condensed Consolidated Statements of Cash Flows (Detail) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Non-cash items included in net income (loss):
Depreciation and amortization	$ 79	$ 72
Amortization of deferred costs	4	3
Loss on extinguishment of debt	(17)
Equity-based compensation expense	6	8
Investing activities:
Capital expenditures	94	105
LQH Parent [Member] | Discontinued Operations [Member]
Non-cash items included in net income (loss):
Depreciation and amortization	4	4
Amortization of deferred costs	1	1
Loss on extinguishment of debt	7
Equity-based compensation expense	4	4
Investing activities:
Capital expenditures	$ 11	$ 12

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Investments In Real Estate - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Service [Member]
Real Estate Properties [Line Items]
Depreciation and amortization expense	$ 39	$ 34	$ 76	$ 68

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Other Assets - Schedule of Other Assets (Detail) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017
Other Assets [Abstract]
Assets held for sale	$ 5	$ 9
Lenders escrow	15
Intangible assets	5	5
Other assets	30	18
Total other assets	$ 55	$ 32

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Other Assets - Additional Information (Detail) $ in Millions	1 Months Ended	3 Months Ended	6 Months Ended		12 Months Ended
	Aug. 13, 2018 USD ($) Hotel	Mar. 31, 2018 USD ($) Hotel	Jun. 30, 2018 USD ($)	Jun. 30, 2017 USD ($)	Dec. 31, 2017 Hotel
Other Assets [Line Items]
Number of hotels classified as assets held for sale | Hotel					3
Number of hotels sold | Hotel		1
Proceeds from sale of hotel | $		$ 4	$ 4	$ 22
Gain on sale of hotels | $		$ 1
Subsequent Event [Member]
Other Assets [Line Items]
Number of hotels sold | Hotel	1
Proceeds from sale of hotel | $	$ 2

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Debt - Schedule of Long-Term Debt (Detail) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017
Debt Instrument [Line Items]
Debt before deferred debt issuance costs and original issue discount	$ 1,060	$ 1,003
Less deferred debt issuance costs and original issue discount	(28)	(11)
Total debt, net	1,032	992
CMBS Facility [Member]
Debt Instrument [Line Items]
Debt before deferred debt issuance costs and original issue discount	1,035
Total debt, net	1,007
Term Facility [Member]
Debt Instrument [Line Items]
Debt before deferred debt issuance costs and original issue discount		1,003
Total debt, net		$ 992
Revolving Facility [Member]
Debt Instrument [Line Items]
Debt before deferred debt issuance costs and original issue discount	25
Total debt, net	$ 25

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Debt - Schedule of Long-Term Debt (Parenthetical) (Detail) - USD ($) $ in Millions				2 Months Ended	3 Months Ended		6 Months Ended		12 Months Ended
	Mar. 06, 2018	Jul. 31, 2015	Apr. 14, 2014	Mar. 06, 2018	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017	May 30, 2018
CMBS Facility [Member]
Debt Instrument [Line Items]
Debt instrument, floor interest rate										0.00%
Debt instrument, basis spread on variable rate		2.75%
Interest expense					$ 6		$ 6
Debt issuance costs net of amortization					28		28
Accrued interest							5
Term Facility [Member]
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate	3.00%			2.75%
Interest expense					$ 8	$ 10	$ 19	$ 21
Debt issuance costs net of amortization									$ 8
Accrued interest									9
Unamortized long-term debt reduction									$ 3
LIBOR [Member]
Debt Instrument [Line Items]
Debt instrument, interest rate							2.09%		1.56%
LIBOR [Member] | CMBS Facility [Member]
Debt Instrument [Line Items]
Debt instrument, floor interest rate					0.00%		0.00%
LIBOR [Member] | Core Point Revolver Borrower | Revolving Facility [Member]
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate			4.50%				4.50%
LIBOR [Member] | Term Facility [Member]
Debt Instrument [Line Items]
Debt instrument, floor interest rate	1.00%			1.00%
Base Rate [Member] | Core Point Revolver Borrower | Revolving Facility [Member]
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate			3.50%				3.50%

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Debt - Additional Information (Detail)				3 Months Ended	6 Months Ended
	May 30, 2018 USD ($) Hotel Extension	Jul. 31, 2015	Apr. 14, 2014	Jun. 30, 2018 USD ($)	Jun. 30, 2018 USD ($)
Debt Instrument [Line Items]
Loss on extinguishment of debt				$ 10,000,000	$ 10,000,000
CMBS Loan Agreement [Member]
Debt Instrument [Line Items]
Aggregate notional amount	$ 1,035,000,000
LIBOR floor percentage	3.25%
Interest rate swap agreement expiration date	Jul. 15, 2020
Revolving Facility [Member]
Debt Instrument [Line Items]
Unused commitment fee percentage	0.50%
Revolving Facility [Member] | Core Point Borrower L L C [Member]
Debt Instrument [Line Items]
Senior secured credit facility	$ 150,000,000
Line of credit facility maturity date	May 30, 2020
Revolving credit facility, drawn amount	$ 25,000,000
Line of credit facility extended expiration period	1 year
Revolving Facility [Member] | Minimum [Member]
Debt Instrument [Line Items]
Unused commitment fee percentage	10.00%
CMBS Loan Agreement [Member]
Debt Instrument [Line Items]
Loss on extinguishment of debt					$ 10,000,000
CMBS Facility [Member]
Debt Instrument [Line Items]
Debt instrument, description of variable rate basis					one-month LIBOR
Debt instrument, floor interest rate	0.00%
Debt instrument, basis spread on variable rate		2.75%
Debt instrument prepayment description					(i) in the case of prepayments (other than in certain enumerated cases) made prior to or on the December 2019 payment date (provided that with respect to any prepayment made after the payment date in November 2019, but prior to the December 2019 payment date, the amount of the spread maintenance payment shall be zero), a spread maintenance premium and in certain cases third party LIBOR breakage costs, and (ii) all accrued interest through the date of prepayment prior to a securitization and through the end of the applicable accrual period following a securitization.
Debt instrument prepayment amount percentage	10.00%
Upfront reserve deposited for lender	$ 15,000,000
CMBS Facility [Member] | LIBOR [Member]
Debt Instrument [Line Items]
Debt instrument, floor interest rate				0.00%	0.00%
CMBS Facility [Member] | Maximum [Member]
Debt Instrument [Line Items]
Debt instrument prepayment amount, percentage	20.00%
CMBS Facility [Member] | First Five Years Term Loan
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate	2.75%
CMBS Facility [Member] | First Five Years Term Loan | Minimum [Member]
Debt Instrument [Line Items]
Debt Instrument Yield Percentage	12.33%
CMBS Facility [Member] | Sixth Year Term Loan
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate	2.90%
CMBS Facility [Member] | Sixth Year Term Loan | Minimum [Member]
Debt Instrument [Line Items]
Debt Instrument Yield Percentage	12.83%
CMBS Facility [Member] | Seventh Year Term Loan
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate	3.00%
CMBS Facility [Member] | Seventh Year Term Loan | Minimum [Member]
Debt Instrument [Line Items]
Debt Instrument Yield Percentage	12.83%
CMBS Facility [Member] | CorePoint CMBS Borrower [Member] | Commercial Mortgage Backed Securities [Member] | Secured Mortgage [Member]
Debt Instrument [Line Items]
Aggregate principal amount of debt	$ 1,035,000,000
Number of owned and ground leased hotels whose mortgages are used to secure mortgage loan | Hotel	307
Number of owned and ground leased hotels for which excess cash flow pledge is made | Hotel	7
Debt instrument initial term	2 years
Debt instrument, number of extension options | Extension	5
Debt instrument each extension option period	12 months
CMBS Facility [Member] | CorePoint CMBS Borrower [Member] | Commercial Mortgage Backed Securities [Member] | Secured Mortgage [Member] | Minimum [Member]
Debt Instrument [Line Items]
Debt instrument extension period at lender option	30 days
CMBS Facility [Member] | CorePoint CMBS Borrower [Member] | Commercial Mortgage Backed Securities [Member] | Secured Mortgage [Member] | Maximum [Member]
Debt Instrument [Line Items]
Debt instrument extension period at lender option	120 days
Core Point Revolver Borrower | Revolving Facility [Member] | Base Rate [Member]
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate			3.50%		3.50%
Core Point Revolver Borrower | Revolving Facility [Member] | LIBOR [Member]
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate			4.50%		4.50%

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Preferred Stock - Additional Information (Detail) - USD ($)	6 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
Class Of Stock [Line Items]
Preferred stock, par value	$ 0.01	$ 0.01
Series A Preferred Stock [Member]
Class Of Stock [Line Items]
Aggregate liquidation preference, value	$ 15,000,000
Payment of cash dividend on preferred stock percentage per annum	13.00%
Preferred stock leverage ratio, increase percentage	7.50%
Preferred stock leverage ratio, decrease percentage	1.00%
Percentage of preferred stock cash dividend required to pay if event of default occurs	15.00%
Percentage of preferred stock leverage ratio increase if an event of default occurs	16.50%
La Quinta Intermediate Holdings | Series A Preferred Stock [Member]
Class Of Stock [Line Items]
Number of shares issued	15,000
Preferred stock, par value	$ 0.01
La Quinta Intermediate Holdings | Series A Preferred Stock [Member] | Minimum [Member]
Class Of Stock [Line Items]
Aggregate liquidation preference, value	$ 2,500,000

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Fair Value Measurements - Carrying Amount and Estimated Fair Values of Financial Assets and Liabilities (Detail) - USD ($) $ in Millions	Jun. 30, 2018	Dec. 31, 2017
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Debt, net	$ 1,032	$ 992
Interest rate caps, carrying amount	1
Interest rate swaps, carrying amount		1
Debt, fair value	25
Interest rate caps, fair value	1
Interest rate swaps, fair value		1
Term Facility [Member]
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Debt, net		992
Debt, fair value		$ 1,007
CMBS Facility [Member]
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Debt, net	1,007
Debt, fair value	1,007
Mandatorily Redeemable Preferred Shares [Member]
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Debt, net	15
Debt, fair value	15
Revolving Facility [Member]
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items]
Debt, net	$ 25

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Fair Value Measurements - Carrying Amount and Estimated Fair Values of Financial Assets and Liabilities (Parenthetical) (Detail) - USD ($) $ in Millions	6 Months Ended	12 Months Ended
	Jun. 30, 2018	Dec. 31, 2017
CMBS Facility [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt issuance cost net	$ 28
Term Facility [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt issuance cost net		$ 14

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Commitments and Contingencies - Additional Information (Detail) $ in Millions			3 Months Ended	6 Months Ended
	May 30, 2018 RenewalOption	Jul. 07, 2014 USD ($)	Jun. 30, 2018 USD ($) Hotel RenewalOption	Jun. 30, 2018 USD ($) RenewalOption Franchise
Commitments And Contingencies [Line Items]
Purchase commitments			$ 19	$ 19
Internal Revenue Service (IRS) [Member]
Commitments And Contingencies [Line Items]
Notice of taxable adjustment from IRS		$ 158
Operating Loss Carryforwards		$ 89
Tax rate impose on REIT, federal and state tax authorities		100.00%		100.00%
Internal Revenue Service (IRS) [Member] | Tax Year 2013 [Member]
Commitments And Contingencies [Line Items]
Proposed adjustment to transfer-pricing related assessment				$ 18
La Quinta Management L.L.C [Member]
Commitments And Contingencies [Line Items]
Management and royalty fees as percentage of total gross revenues	5.00%
Management agreement date	May 30, 2018
Management agreement term for managing hotel	20 years
Number hotel management agreement renewal options available | RenewalOption	2
Hotel management agreements, renewal period	5 years
La Quinta Franchising LLC [Member]
Commitments And Contingencies [Line Items]
Number of franchise agreements | Franchise				315
Percentage of royalty fee on gross rooms revenue				5.00%
Franchise agreement term for managing hotel				20 years
Number of franchise renewal options available | RenewalOption			1	1
Franchise agreements renewal period				10 years
Percentage of reservation fee based on hotels gross room revenue				2.00%
Percentage of marketing fee based on hotels gross room revenues				2.50%
Percentage of loyalty program fee based on hotels room night revenue and other miscellaneous ancillary fees				5.00%
Baymont [Member]
Commitments And Contingencies [Line Items]
Number of hotels transferred | Hotel			1
Percentage of reservation fee based on hotels gross room revenue				1.50%
Percentage of marketing fee based on hotels gross room revenues				2.00%
Percentage of loyalty program fee based on hotels room night revenue and other miscellaneous ancillary fees				5.00%

XML

Income Taxes - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Income Tax Disclosure [Abstract]
Percentage of taxable income not distributed for any year elected as REIT status that subject to income tax			100.00%
Provision for federal, state and foreign income tax expense	$ 2	$ 14	$ 1	$ 19
Income tax federal statutory rate	21.00%	35.00%	21.00%	35.00%

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Equity-Based Compensation - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Continuing Operations [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Equity-based compensation expense recognized	$ 1	$ 2	$ 2	$ 4
Discontinued Operations [Member]
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Equity-based compensation expense recognized	$ 1	$ 2	$ 4	$ 4

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Equity-Based Compensation - Summary of Activity of RSAs (Detail) - RSAs [Member]	6 Months Ended
	Jun. 30, 2018 $ / shares shares
Number of Shares
Unvested at January 1, 2018 | shares	512,117
Granted | shares	633,241
Conversion of the performance units upon completion of the spin-off | shares	423,510
Vested | shares	(421,123)
Forfeited | shares	(5,737)
Unvested at June 30, 2018 | shares	1,142,008
Weighted-Average Grant Date Fair Value
Unvested at January 1, 2018 | $ / shares	$ 25.90
Granted | $ / shares	27.89
Conversion of the performance units upon completion of the spin-off | $ / shares	27.92
Vested | $ / shares	26.41
Forfeited | $ / shares	27.45
Unvested at June 30, 2018 | $ / shares	$ 27.59

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Related Party Transactions - Additional Information (Detail) - USD ($) $ in Millions		3 Months Ended	6 Months Ended
	May 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017	Dec. 31, 2017
Previously Managed Hotels [Member]
Related Party Transaction [Line Items]
Purchase products and services from affiliates		$ 2	$ 1	$ 2
Blackstone [Member]
Related Party Transaction [Line Items]
Percentage of holdings' shares of common stock outstanding			30.00%
Affiliates of Black Stone [Member] | Senior Secured Term Loan Facility [Member]
Related Party Transaction [Line Items]
Senior secured credit facility			$ 518		$ 82
La Quinta Holdings Inc. and Wyndham Worldwide Merger Agreement [Member]
Related Party Transaction [Line Items]
Merger and separation agreement of cash payment	$ 1,002

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Supplemental Disclosures of Cash Flow Information - Summary of Supplemental Cash Flow Information (Detail) - USD ($) $ in Millions	6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017
Supplemental cash flow information:
Interest paid during the period	$ 54	$ 39
Income taxes paid during the period, net of refunds	1	4
Supplemental non-cash disclosure:
Capital expenditures included in accounts payable	5	19
Cash flow hedge adjustment, net of tax	1	2
Receivable for capital assets damaged by casualty disasters	$ 3	$ 4

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Earnings Per Share - Additional Information (Detail) shares in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2018 shares	Jun. 30, 2017 shares	Jun. 30, 2018 shares	Jun. 30, 2017 shares
Earnings Per Share [Abstract]
Reverse stock split, description			On May 18, 2018, received one share of CorePoint common stock for each share of LQH Parent common stock held after giving effect to the Reverse Stock Split.
Distribution ratio	0.5		0.5
Anti-dilutive securities excluded from computation of diluted shares	0.7	0.4	0.6	0.3

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Earnings Per Share - Reconciliation of Numerators and Denominators Used for Computation of Basic and Diluted (Loss) Earnings Per Share (Detail) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2018	Jun. 30, 2017	Jun. 30, 2018	Jun. 30, 2017
Numerator:
Income (loss) from Continuing Operations, net of tax	$ (28)	$ 19	$ (38)	$ 24
Loss on Discontinued Operations, net of tax	(20)	(2)	(25)	(6)
Net Income (loss) attributable to CorePoint Lodging stockholders	$ (48)	$ 17	$ (63)	$ 18
Denominator:
Weighted average number of shares outstanding, basic	58.3	57.9	58.2	58.0
Weighted average number of shares outstanding, diluted	58.3	58.2	58.2	58.2
Basic and diluted from continuing operations	$ (0.48)	$ 0.32	$ (0.65)	$ 0.41
Basic and diluted from discontinued operations	(0.34)	(0.03)	(0.43)	(0.10)
Basic and diluted (loss) earnings per share	$ (0.82)	$ 0.29	$ (1.08)	$ 0.31

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Subsequent Events - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions		6 Months Ended
	Aug. 02, 2018	Jun. 30, 2018	Aug. 06, 2018
Subsequent Event [Line Items]
Dividends payable, declared date		Aug. 06, 2018
Dividends declared, payable date		Sep. 14, 2018
Dividends payable, date of record		Aug. 30, 2018
Subsequent Event [Member]
Subsequent Event [Line Items]
Cash dividends declared, per share			$ 0.067
Subsequent Event [Member] | Revolving Facility [Member]
Subsequent Event [Line Items]
Repayments of previously drawn credit facility	$ 25