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Choice Hotels Will Expense All Stock Options

Choice Hotels International, Inc. (NYSE:CHH) announced today it will expense the cost of all stock options the company grants, beginning with options to be granted in the first quarter of 2003.

The accounting change, approved by the company’s Board of Directors, reflects the company’s view that expensing stock options is the preferable way to record employee compensation costs.

The company will adopt the fair value based method of recording stock options contained in Statement of Financial Accounting Standards (“SFAS”) No. 123, Accounting for Stock-Based Compensation, which will affect any options granted on or after January 1, 2003.

“This change anticipates what we believe will ultimately become the accepted method of accounting for employee compensation,” said Charles A. Ledsinger, Jr., president and chief executive officer. “Stock options clearly are a form of employee compensation expense and should be reflected as such in our financial results.”

If the Board of Directors grants options in 2003 at a similar level to 2002, the company expects the impact would be approximately $0.03 per share for 2003.

Certain matters discussed in this press release may constitute forward-looking statements within the meaning of the federal securities law. Such statements are based on management’s beliefs, assumptions and expectations, which in turn are based on information currently available to management. Actual performance and results could differ from those expressed in or contemplated by the forward-looking statements due to a number of risks, uncertainties and other factors, many of which are beyond Choice’s ability to predict or control. For further information on factors that could impact Choice and the statements contained therein, we refer you to the filings made by Choice with the Securities and Exchange Commission, including its registration statement on Form S-4 and report on Form 10-Q for the period ended September 30, 2001.

Additional corporate information may be found on the Choice Hotels’ Internet site, which may be accessed at www.choicehotels.com

Choice Hotels, Choice Hotels International, Comfort Inn, Comfort Suites, Quality, Clarion, Sleep Inn, Econo Lodge, MainStay Suites, Rodeway Inn, and The Power of Being There. Go are proprietary trademarks and service marks of Choice Hotels International.

Posted by on February 11, 2006.

Categories: Financial

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