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RLJ Lodging Trust (NYSE:RLJ), currently trading at slightly below InvestingPro’s Fair Value estimate, has renewed the employment agreement with its Executive Chairman, Robert L. Johnson, as disclosed in a recent SEC filing. The agreement, effective since November 1, 2024, extends Johnson’s tenure for another three years at the company, which has maintained dividend payments for 14 consecutive years.
Under the terms of the new contract, Johnson will maintain his annual base salary of $500,000. This salary is subject to review and potential increase but cannot be reduced. Additionally, Johnson is eligible for a cash bonus with a minimum threshold of 75% of his base salary, a target of 125%, a maximum opportunity of 175%, and an outperformance opportunity of up to 225%. The company’s management has demonstrated alignment with shareholder interests through aggressive share buybacks, while maintaining a healthy 6.2% dividend yield.
Johnson is also entitled to equity grants, which may include options, restricted shares, restricted share units, and long-term incentive units in the Operating Partnership. These grants, subject to vesting and other conditions, will be commensurate with those awarded to other executives of the company.
The filing also outlines severance terms and includes non-competition and non-solicitation clauses effective for 24 months post-employment. These provisions are standard for executive employment agreements in the industry.
This information is based on the 8-K filing by RLJ Lodging Trust with the Securities and Exchange Commission. The agreement reflects the company’s commitment to maintaining stable leadership as it continues its operations in the real estate investment trust sector. With the company’s next earnings report due in 6 days, InvestingPro subscribers can access 10 additional exclusive tips and comprehensive analysis through the Pro Research Report, helping investors make informed decisions about this REIT’s future prospects.
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