Using publicly-available documentation, BloggerNews has learned that a Sessa Capital nominee for the Board of Directors in the Ashford Hospitality Prime (AHP) proxy fight ran another company into the ground during his tenure as CEO.
According to documentation on the now-defunct Ambassadors Group, which previously traded on the Nasdaq under the symbol “EPAX”, Sessa Capital nominee Philip B. Livingston was named interim CEO on May 10, 2014.
Ambassadors Group had a business that arranged educational tours for students and adults. It corrupted the “People to People” program, a concept initiated by President Eisenhower in 1956, designed as a privately-run cultural exchange, where individuals would live in the homes of foreign hosts. Ambassadors Group bought People-to-People in 1996. In the ensuing years, the division racked up hundreds of complaints.
Many of these complaints involved deceptive advertising, and a glance down the list shows many were still occurring during Livingston’s tenure. Why on earth would any AHP shareholder want this guy to be on the Board of Directors of their company? Given that a company’s reputation, particularly in this arena, is so vital, why didn’t he tackle these issues immediately?
Under Livingston, Ambassador’s Group stock fell from $4.15 to $1.70, its final liquidation value. Philip Livingston brought absolutely no value to the company, and arguably ran it into the ground. It lost over $17 million in FY14. When the company finally blew up in late 2015, he had presumably collected about $450,000 in compensation (his $300,000 annual salary x 1.5 years), along with a full year’s $300,000 salary (according to his employment agreement), as well as having his COBRA health coverage paid for a full year.
That’s a pretty sweet deal — $750,000 for 18 months work in which he destroyed what company value remained for its shareholders.
This is the person that Sessa Capital believes is qualified to be on the AHP Board of Directors. Ashford Prime stockholders must be aware that this is not the kind Board member they need.