Annual report
Page 1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K ☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2025 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: 001-31775 ASHFORD HOSPITALITY TRUST, INC. (Exact name of registrant as specified in its charter) Maryland 86-1062192 (State or other jurisdiction of incorporation or organization) (IRS employer identification number) 14185 Dallas Parkway Suite 1200 Dallas Texas 75254 (Address of principal executive offices) (Zip code) (972) 490-9600 (Registrant’s telephone number, including area code) Securities registered pursuant to Section 12(b) of the Act: Title of each class Trading Symbol(s) Name of each exchange on which registered Common Stock AHT New York Stock Exchange Preferred Stock, Series D AHT-PD New York Stock Exchange Preferred Stock, Series F AHT-PF New York Stock Exchange Preferred Stock, Series G AHT-PG New York Stock Exchange Preferred Stock, Series H AHT-PH New York Stock Exchange Preferred Stock, Series I AHT-PI New York Stock Exchange Preferred Stock Repurchase Rights - New York Stock Exchange Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ¨ Yes þ No Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. ¨ Yes þ No 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. þ Yes ¨ No Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 such files) þ 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,” “small reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☑ 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 has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 USC. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐ If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐ Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐ Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) ☐ Yes þ No As of June 30, 2025, the aggregate market value of 5,843,444 shares of the registrant’s common stock held by non-affiliates was approximately $35,178,000. As of March 18, 2026, the registrant had 6,476,491 shares of common stock issued and outstanding. DOCUMENTS INCORPORATED BY REFERENCE Portions of the registrant’s definitive Proxy Statement pertaining to the 2026 Annual Meeting of Stockholders are incorporated herein by reference into Part III of this Form 10-K.
Page 2
ASHFORD HOSPITALITY TRUST, INC. YEAR ENDED DECEMBER 31, 2025 INDEX TO FORM 10-K Page PART I Item 1. Business 3 Item 1A. Risk Factors 10 Item 1B. Unresolved Staff Comments 42 Item 1C. Cybersecurity 43 Item 2. Properties 44 Item 3. Legal Proceedings 46 Item 4. Mine Safety Disclosures 46 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 46 Item 6. Reserved 52 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 52 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 73 Item 8. Financial Statements and Supplementary Data 74 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 143 Item 9A. Controls and Procedures 143 Item 9B. Other Information 143 Item 9C. Disclosure Regarding Foreign Jurisdictions That Prevent Inspections 143 PART III Item 10. Directors, Executive Officers and Corporate Governance 143 Item 11. Executive Compensation 144 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 144 Item 13. Certain Relationships and Related Transactions, and Director Independence 144 Item 14. Principal Accounting Fees and Services 144 PART IV Item 15. Financial Statement Schedules and Exhibits 144 Item 16. Form 10-K Summary 152 SIGNATURES
Page 3
This Annual Report is filed by Ashford Hospitality Trust, Inc., a Maryland corporation (“the Company”). Unless the context otherwise requires, all references to the Company include those entities owned or controlled by the Company. In this report, the terms “the Company,” “Ashford Trust,” “we,” “us” or “our” mean Ashford Hospitality Trust, Inc. and all entities included in its consolidated financial statements. FORWARD-LOOKING STATEMENTS Throughout this Annual Report on Form 10-K and documents incorporated herein by reference, we make forward-looking statements that are subject to risks and uncertainties. Forward-looking statements are generally identifiable by use of forward-looking terminology such as “may,” “will,” “should,” “potential,” “intend,” “expect,” “anticipate,” “estimate,” “approximately,” “believe,” “could,” “project,” “predict,” or other similar words or expressions. Additionally, statements regarding the following subjects are forward-looking by their nature: • the factors discussed in this Annual Report under the sections entitled “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Business,” and “Properties,” as updated in our subsequent Quarterly Reports on Form 10-Q and other filings under the Securities Exchange Act of 1934, as amended (the “Exchange Act”); • our business and investment strategy; • anticipated or expected purchases, sales or dispositions of assets; • our projected operating results; • completion of any pending transactions; • our ability to restructure existing property-level indebtedness; • our ability to secure additional financing to enable us to operate our business; • our understanding of our competition; • projected capital expenditures; and • the impact of technology on our operations and business. Such forward-looking statements are based on our beliefs, assumptions, and expectations of our future performance, taking into account all information currently known to us. These beliefs, assumptions and expectations can change as a result of many potential events or factors, not all of which are known to us. If a change occurs, our business, financial condition, liquidity, results of operations, plans and other objectives may vary materially from those expressed in our forward-looking statements. You should carefully consider this risk when you make an investment decision concerning our securities. Additionally, the following factors could cause actual results to vary from our forward-looking statements: • the factors discussed in this Annual Report under the sections entitled “Risk Factors,” “Legal Proceedings,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Business,” and “Properties,” as updated in our subsequent Quarterly Reports on Form 10-Q and other filings under the Exchange Act; • changes in interest rates and inflation; • macroeconomic conditions, such as a prolonged period of weak economic growth and volatility in capital markets; • uncertainty in the banking sector and market volatility; • catastrophic events or geopolitical conditions, such as the conflict between Russia and Ukraine, the Israel-Palestine-Iran conflict, ongoing instability in Venezuela and changes to tariffs or trade policies; • extreme weather conditions, which may cause property damage or interrupt business; • actions by the lenders to foreclose on our assets that are pledged as collateral; • general volatility of the capital markets and the market price of our common and preferred stock; • general and economic business conditions affecting the lodging and travel industry; • changes in our business or investment strategy; • availability, terms and deployment of capital; • our ability to raise capital on terms favorable to us and in a timely manner; • unanticipated increases in financing and other costs; • changes in our industry and the market in which we operate and local economic conditions; • the degree and nature of our competition; 2
Page 4
• actual and potential conflicts of interest with Ashford Hospitality Advisors LLC (“Ashford LLC”), Remington Lodging & Hospitality, LLC (“Remington Hospitality”), Premier Project Management LLC (“Premier”), Braemar Hotels & Resorts Inc. (“Braemar”), our executive officers and our non-independent directors; • changes in personnel of Ashford LLC or the lack of availability of qualified personnel; • changes in governmental regulations, accounting rules, tax rates and similar matters; • our ability to continue as a going concern as described in our financial statement footnotes and generate sufficient liquidity to satisfy our obligations as they become due; • legislative and regulatory changes, including changes to the Internal Revenue Code of 1986, as amended (the “Code”), and related rules, regulations and interpretations governing the taxation of real estate investment trusts (“REITs”), including impacts from the One Big Beautiful Bill Act (the “OBBBA”); • limitations imposed on our business and our ability to satisfy complex rules in order for us to qualify as a REIT for U.S. federal income tax purposes; • changes in our dividend policy; • our preferred stock purchase rights could hinder the market for our common stock; and • future sales and issuances of our common stock or other securities which might result in dilution and could cause the price of our common stock to decline or cause our common stock to be delisted from the NYSE. When considering forward-looking statements, you should keep in mind the risk factors and other cautionary statements in this Annual Report on Form 10-K. The matters summarized under “Item 1A. Risk Factors,” and elsewhere, could cause our actual results and performance to differ significantly from those contained in our forward-looking statements. Accordingly, we cannot guarantee future results or performance. Readers are cautioned not to place undue reliance on any of these forward-looking statements, which reflect our views as of the date of this Annual Report on Form 10-K. Furthermore, we do not intend to update any of our forward-looking statements after the date of this Annual Report on Form 10-K to conform these statements to actual results and performance, except as may be required by applicable law. PART I Item 1. Business GENERAL Ashford Hospitality Trust, Inc., together with its subsidiaries is a REIT. While our portfolio currently consists of upscale hotels and upper upscale full-service hotels, our investment strategy is predominantly focused on investing in upper upscale full-service hotels in the United States that have revenue per available room (“RevPAR”) generally less than twice the U.S. national average, and in all methods including direct real estate, equity and debt. We currently anticipate future investments will predominantly be in upper upscale hotels. We own our lodging investments and conduct our business through Ashford Hospitality Limited Partnership (“Ashford Trust OP”), our operating partnership. Ashford OP General Partner LLC, a wholly owned subsidiary of Ashford Trust, serves as the sole general partner of our operating partnership. Our hotel properties are primarily branded under the widely recognized upscale and upper upscale brands of Hilton, Hyatt, Marriott and Intercontinental Hotel Group. As of December 31, 2025, we held interests in the following assets: • 67 consolidated operating hotel properties, which represent 16,445 total rooms; • one consolidated operating hotel property, which represents 188 total rooms through a 29.3%-owned investment in a consolidated entity; and • an investment in an entity that owns the Meritage Resort and Spa and the Grand Reserve at the Meritage (the “Meritage Investment”) in Napa, California, with a carrying value of approximately $7.3 million. For U.S. federal income tax purposes, we have elected to be treated as a REIT, which imposes limitations related to operating hotels. As of December 31, 2025, our 68 operating hotel properties were leased by our wholly-owned or majority-owned subsidiaries, which are treated as taxable REIT subsidiaries for U.S. federal income tax purposes (collectively, these subsidiaries are referred to as “Ashford TRS”). Ashford TRS then engages third-party or affiliated hotel management companies to operate the hotels under management contracts. Hotel operating results related to these properties are included in the consolidated statements of operations. We are advised by Ashford LLC, a subsidiary of Ashford Inc., through an advisory agreement. All of the hotel properties in our portfolio are currently asset-managed by Ashford LLC. We do not have any employees. All of the services that might be provided by employees are provided to us by Ashford LLC. 3
Page 5
We do not operate any of our hotel properties directly; instead, we contractually engage hotel management companies to operate them for us under management contracts. Remington Hospitality manages 50 of our 68 hotel properties. Third-party management companies manage the remaining hotel properties. Ashford Inc. also provides other products and services to us or our hotel properties through certain entities in which Ashford Inc. has an ownership interest. These products and services include, but are not limited to, design and construction services, debt placement and related services, audiovisual services, real estate advisory and brokerage services, insurance policies covering general liability, workers’ compensation and business automobile claims and insurance claims services, hypoallergenic premium rooms, watersport activities, broker- dealer and distribution services and cash management services. See note 17 to our consolidated financial statements. Mr. Monty J. Bennett is chairman and chief executive officer of Ashford Inc. and, together with his father Mr. Archie Bennett, Jr., as of December 31, 2025, holds a controlling interest in Ashford Inc. As of December 31, 2025, the Bennetts owned approximately 809,937 shares of Ashford Inc. common stock, which represented an approximate 51.9% ownership interest in Ashford Inc., and owned 18,758,600 shares of Ashford Inc. Series D Convertible Preferred Stock, which, along with all unpaid accrued and accumulated dividends thereon, was convertible (at a conversion price of $117.50 per share) into an additional approximate 4,573,359 shares of Ashford Inc. common stock, which if converted as of December 31, 2025, would have increased the Bennetts’ ownership interest in Ashford Inc. to 87.8%. The 18,758,600 shares of Series D Convertible Preferred Stock owned by Mr. Monty J. Bennett and Mr. Archie Bennett, Jr. include 360,000 shares owned by trusts. Additionally, Mr. Monty J. Bennett acquired the right to direct votes, effective March 25, 2025, and as of December 31, 2025, those rights represented approximately 551,000 common shares. Liquidity As of December 31, 2025, the Company held cash and cash equivalents of $66.8 million and restricted cash of $149.6 million (including amounts held for sale). The vast majority of the restricted cash comprises lender and manager held reserves. BUSINESS STRATEGIES Based on our primary business objectives and forecasted operating conditions, our current key priorities and financial strategies include, among other things: • preserving capital and maintaining significant cash and cash equivalents liquidity; • disposition of non-core hotel properties; • acquisition of hotel properties, in whole or in part, that we expect will be accretive to our portfolio; • pursuing capital market activities and implementing strategies to enhance long-term stockholder value; • accessing cost effective capital, including through the issuance of non-traded preferred securities; • opportunistically exchanging preferred stock into common stock; • implementing selective capital improvements designed to increase profitability and maintain the quality of our assets; • implementing effective asset management strategies to minimize operating costs and increase revenues; • financing or refinancing hotels on competitive terms; • modifying or extending property-level indebtedness; • utilizing hedges, derivatives and other strategies to mitigate risks; • pursuing opportunistic value-add additions to our hotel portfolio; and • making other investments or divestitures that our board of directors deems appropriate. Our current investment strategy is to focus on owning predominantly full-service hotels in the upper upscale segment in domestic markets that have RevPAR generally less than twice the U.S. national average. We believe that as supply, demand, and capital market cycles change, we will be able to shift our investment strategy to take advantage of new lodging-related investment opportunities as they may develop. Our investments may include: (i) direct hotel investments; (ii) mezzanine financing through origination or acquisition; (iii) first mortgage financing through origination or acquisition; (iv) sale-leaseback transactions; and (v) other hospitality transactions. Our strategy is designed to take advantage of lodging industry conditions and adjust to changes in market circumstances over time. Our assessment of market conditions will determine asset reallocation strategies. While we seek to capitalize on favorable market fundamentals, conditions beyond our control may have an impact on overall profitability, our investment 4
Page 6
opportunities and our investment returns. We will continue to seek ways to benefit from the cyclical nature of the hotel industry. To take full advantage of future investment opportunities in the lodging industry, we intend to seek our investment opportunities according to the asset allocation strategies described below. However, due to ongoing changes in market conditions, we will continually evaluate the appropriateness of our investment strategies. Our board of directors may change any or all of these strategies at any time without stockholder approval or notice. Direct Hotel Investments—In selecting hotels to acquire, we target hotels that offer either a high current return or the opportunity to increase in value through repositioning, capital investments, market-based recovery, or improved management practices. Our direct hotel acquisition strategy primarily targets full-service upscale and upper upscale hotels with RevPAR less than twice the national average in primary, secondary, and resort markets, typically throughout the U.S. and will seek to achieve both current income and appreciation. In addition, we will continue to assess our existing hotel portfolio and make strategic decisions to sell certain under-performing or non- strategic hotels that no longer fit our investment strategy or criteria due to micro or macro market changes or other reasons. Other Transactions—We may also seek investment opportunities in other lodging-related assets or businesses that offer diversification, attractive risk adjusted returns, and/or capital allocation benefits, including mezzanine financing, first mortgage financing, and/or sale- leaseback transactions. BUSINESS SEGMENTS We currently operate in one business segment within the hotel lodging industry: direct hotel investments. A discussion of our operating segment is incorporated by reference from note 24 to our consolidated financial statements set forth in Part II, Item 8. Financial Statements and Supplementary Data. FINANCING STRATEGY We often utilize debt to increase equity returns. When evaluating our future level of indebtedness and making decisions regarding the incurrence of indebtedness, we consider a number of factors, including: • our leverage levels across the portfolio; • the purchase price of our investments to be acquired with debt financing; • impact on financial covenants; • cost of debt; • loan maturity schedule; • the estimated market value of our investments upon refinancing; • the ability of particular investments, and our Company as a whole, to generate cash flow to cover expected debt service; and • trailing twelve months net operating income of the hotel to be financed. We may incur debt in the form of purchase money obligations to the sellers of properties, publicly or privately placed debt instruments, or financing from banks, institutional investors, or other lenders. Any such indebtedness may be secured or unsecured by mortgages or other interests in our properties. This indebtedness may be recourse, non-recourse, or cross-collateralized. If recourse, such recourse may include our general assets or be limited to the particular investment to which the indebtedness relates. In addition, we may invest in properties or loans subject to existing loans secured by mortgages or similar liens on the properties, or we may refinance properties acquired on a leveraged basis. We may use the proceeds from any borrowings for working capital, consistent with industry practice, to: • purchase interests in partnerships or joint ventures; • finance the origination or purchase of debt investments; or • finance acquisitions, expand, redevelop or improve existing properties, or develop new properties or other uses. In addition, if we do not have sufficient cash available, we may need to borrow to meet taxable income distribution requirements under the Code. No assurances can be given that we will obtain additional financings or, if we do, what the amount and terms will be. Our failure to obtain future financing under favorable terms could adversely impact our ability to execute our business strategy. In addition, we may selectively pursue debt financing on our individual properties and debt investments. 5
Page 7
DISTRIBUTION POLICY No dividends can be paid on our common stock unless and until all accumulated and unpaid dividends on our outstanding preferred stock have been declared and paid or set aside for payment. Additionally, under Maryland law and except for an ability to pay a dividend out of current earnings in certain limited circumstances, no dividend (except a dividend in shares of stock) may be declared or paid by a Maryland corporation unless, after giving effect to the dividend, assets will continue to exceed liabilities and the corporation will be able to continue to pay its debts as they become due in the usual course. Maryland law permits these determinations to be made by our board of directors based on either a book value basis or a reasonable fair value basis. As of December 31, 2025, the Company had a deficit in stockholders’ equity of approximately $626.4 million and had not generated current earnings from which a dividend is potentially payable since the year ended December 31, 2015. There is no expectation that a dividend on our common stock can or would be considered or declared at any time in the foreseeable future. Distributions are authorized by our board of directors and declared by us based upon a variety of factors deemed relevant by our directors. The board of directors will continue to review our distribution policy on at least a quarterly basis. Our ability to pay distributions to our preferred or common stockholders will depend, in part, upon our receipt of distributions from our operating partnership. This, in turn, may depend upon receipt of lease payments with respect to our properties from indirect subsidiaries of our operating partnership, the management of our properties by our hotel managers and general business conditions. Distributions to our stockholders are generally taxable to our stockholders as ordinary income. However, since a portion of our investments are equity ownership interests in hotels, which result in depreciation and non-cash charges against our income, a portion of our distributions may constitute a non-taxable return of capital, to the extent of a stockholder’s tax basis in the stock. To the extent that it is consistent with maintaining our REIT status, we may maintain accumulated earnings of Ashford TRS in that entity. On December 15, 2025, our board of directors reviewed and approved our 2026 dividend policy. We do not anticipate paying any dividends on our outstanding common stock for any quarter during 2026. Further, to preserve the Company’s liquidity position as it evaluates strategic alternatives, preferred dividends have been suspended, including dividends previously declared for recordholders of the Company’s Series D, F, G, H, I, J, K, L and M preferred stock as of December 31, 2025, and payable on January 15, 2026. We intend to pay the previously declared but unpaid dividends as soon as reasonably practicable. Any accrued but unpaid dividends will accrue in accordance with the terms outlined in the applicable governing documents for each series of preferred stock. We will continue to evaluate potential future dividends on a quarterly basis. Declaration of dividends in 2026 on our preferred stock may require a determination by our board of directors, at the time of any determination, that the Company would continue to have positive equity on a fair value basis, among other considerations. Our board of directors will continue to review our dividend policy and make future announcements with respect thereto. We may incur indebtedness to meet distribution requirements imposed on REITs under the Code to the extent that working capital and cash flow from our investments are insufficient to fund required distributions. Our corporate charter allows us to issue preferred stock with a preference on distributions, such as our 8.45% Series D Cumulative Preferred Stock, par value $0.01 per share (the “Series D Preferred Stock”), 7.375% Series F Cumulative Preferred Stock, par value $0.01 per share (the “Series F Preferred Stock”), 7.375% Series G Cumulative Preferred Stock, par value $0.01 per share (the “Series G Preferred Stock”), 7.50% Series H Cumulative Preferred Stock, par value $0.01 per share (the “Series H Preferred Stock”), 7.50% Series I Cumulative Preferred Stock, par value $0.01 per share (the “Series I Preferred Stock”), 8.0% Series J Redeemable Preferred Stock, par value $0.01 per share (the “Series J Preferred Stock”), Series K Redeemable Preferred Stock, par value $0.01 per share (the “Series K Preferred Stock”), Series L Redeemable Preferred Stock, par value $0.01 per share (the “Series L Preferred Stock”), and Series M Redeemable Preferred Stock, par value $0.01 per share (the “Series M Preferred Stock”) (together the “Preferred Stock”). The partnership agreement of our operating partnership also allows the operating partnership to issue units with a preference on distributions. The issuance of these series of Preferred Stock and units together with any similar issuance in the future, given the dividend preference on such stock or units, could limit our ability to make a dividend distribution to our common stockholders. COMPETITION The hotel industry is highly competitive, and the hotels in which we invest are subject to competition from other hotels for guests. Competition is based on a number of factors, most notably convenience of location, availability of rooms, brand affiliation, price, range of services, guest amenities or accommodations offered, and quality of customer service. Competition is often specific to the individual markets in which our properties are located and includes competition from existing and new hotels. Increased competition could have a material adverse effect on the occupancy rate, average daily room rate and revenue per available room of our hotels or may require us to make capital improvements that we otherwise would not have to make, which may result in decreases in our profitability. 6
Page 8
Our principal competitors include other hotel operating companies, ownership companies and national and international hotel brands. We face increased competition from providers of less expensive accommodations, such as select-service hotels or independent owner- managed hotels, during periods of economic downturn when leisure and business travelers become more sensitive to room rates. We also experience competition from alternative types of accommodations such as home sharing companies and apartment operators offering short- term rentals. EMPLOYEES We have no employees. Our appointed officers are provided by Ashford LLC, a subsidiary of Ashford Inc. (collectively, our “advisor”). Advisory services which would otherwise be provided by employees are provided by subsidiaries of Ashford Inc. and by our appointed officers. Subsidiaries of Ashford Inc. currently have approximately 82 full-time employees who provide advisory services to us. These employees directly or indirectly perform various acquisition, development, asset management, capital markets, accounting, tax, risk management, legal, redevelopment, and corporate management functions pursuant to the terms of our advisory agreement. GOVERNMENTAL REGULATIONS Our properties are subject to various federal, state and local regulatory laws and requirements, including, but not limited to, the Americans with Disabilities Act of 1990, as amended (the “ADA”), zoning regulations, building codes and land use laws, and building, occupancy and other permit requirements. Noncompliance could result in the imposition of governmental fines or the award of damages to private litigants. While we believe that we are currently in material compliance with these regulatory requirements, the requirements may change or new requirements may be imposed that could require significant unanticipated expenditures by us. Additionally, local zoning and land use laws, environmental statutes, health and safety rules and other governmental requirements may restrict, or negatively impact, our property operations, or expansion, rehabilitation and reconstruction activities and such regulations may prevent us from taking advantage of economic opportunities. Future changes in federal, state or local tax regulations applicable to REITs, real property or income derived from our real estate could impact the financial performance, operations, and value of our properties and the Company. ENVIRONMENTAL MATTERS Under various federal, state, and local laws and regulations, an owner or operator of real estate may be liable for the costs of removal or remediation of certain hazardous or toxic substances on such property. These laws often impose liability without regard to whether the owner knew of, or was responsible for, the presence of hazardous or toxic substances. Furthermore, a person who arranges for the disposal of a hazardous substance or transports a hazardous substance for disposal or treatment from property owned by another may be liable for the costs of removal or remediation of hazardous substances released into the environment at that property. The costs of remediation or removal of such substances may be substantial, and the presence of such substances, or the failure to promptly remediate such substances, may adversely affect the owner’s ability to sell the affected property or to borrow using the affected property as collateral. In connection with the ownership and operation of our properties, we, our operating partnership, or Ashford TRS may be potentially liable for any such costs. In addition, the value of any lodging property loan we originate or acquire would be adversely affected if the underlying property contained hazardous or toxic substances. Phase I environmental assessments, which are intended to identify potential environmental contamination for which our properties may be responsible, have been obtained on substantially all of our properties. Such Phase I environmental assessments included: • historical reviews of the properties; • reviews of certain public records; • preliminary investigations of the sites and surrounding properties; • screening for the presence of hazardous substances, toxic substances, and underground storage tanks; and • the preparation and issuance of a written report. Such Phase I environmental assessments did not include invasive procedures, such as soil sampling or ground water analysis. Such Phase I environmental assessments have not revealed any environmental liability that we believe would have a material adverse effect on our business, assets, results of operations, or liquidity, and we are not aware of any such liability. To the extent Phase I environmental assessments reveal facts that require further investigation, we would perform a Phase II environmental assessment. However, it is possible that these environmental assessments will not reveal all environmental liabilities. There may be material environmental liabilities of which we are unaware, including environmental liabilities that may have arisen since the environmental assessments were completed or updated. No assurances can be given that: (i) future 7
Page 9
laws, ordinances, or regulations will not impose any material environmental liability; or (ii) the current environmental condition of our properties will not be affected by the condition of properties in the vicinity (such as the presence of leaking underground storage tanks) or by third parties unrelated to us. We believe our properties are in compliance in all material respects with all federal, state, and local ordinances and regulations regarding hazardous or toxic substances and other environmental matters. Neither we nor, to our knowledge, any of the former owners of our properties have been notified by any governmental authority of any material noncompliance, liability, or claim relating to hazardous or toxic substances or other environmental matters in connection with any of our properties. INSURANCE We maintain comprehensive insurance, including liability, property, workers’ compensation, rental loss, environmental, terrorism, cybersecurity, directors and officers and, when available on commercially reasonable terms, flood, wind and earthquake insurance, with policy specifications, limits, and deductibles customarily carried for similar properties. Certain types of losses (for example, matters of a catastrophic nature such as global pandemics, acts of war or substantial known environmental liabilities) as well as certain types of coverages previously available under policies set forth above (for example, communicable disease, abuse & molestation coverages previously available under general liability policies) are either uninsurable or require substantial premiums that are not economically feasible to maintain. Certain types of losses, such as those arising from subsidence activity, are insurable only to the extent that certain standard policy exceptions to insurability are waived by agreement with the insurer. We believe, however, that our properties are adequately insured, consistent with industry standards. FRANCHISE LICENSES We believe that the public’s perception of quality associated with a franchisor can be an important feature in the operation of a hotel. Franchisors provide a variety of benefits for franchisees, which include national advertising, publicity, and other marketing programs designed to increase brand awareness, training of personnel, continuous review of quality standards, and centralized reservation systems. As of December 31, 2025, our portfolio consisted of 68 consolidated operating hotel properties, 63 of which operated under franchise licenses or brand management agreements, which provided for the right to operate each hotel under the applicable brand. See Item 2 Properties, below for a complete listing of all hotels by brand. Our management companies, including Remington Hospitality, must operate each hotel pursuant to the terms of the related franchise or brand management agreement and must use their best efforts to maintain the right to operate each hotel pursuant to such terms. In the event of termination of a particular franchise or brand management agreement, our management companies must operate any affected hotels under another franchise or brand management agreement, if any, that we enter into. We anticipate that many of the additional hotels we acquire could be operated under franchise licenses or brand management agreements as well. Our franchise licenses and brand management agreements generally specify certain management, operational, recordkeeping, accounting, reporting, and marketing standards and procedures with which the franchisee or brand operator must comply, including requirements related to: • training of operational personnel; • safety; • maintaining specified insurance; • types of services and products ancillary to guestroom services that may be provided; • display of signage; and • type, quality, and age of furniture, fixtures, and equipment included in guestrooms, lobbies, and other common areas. SEASONALITY Our properties’ operations historically have been seasonal as certain properties maintain higher occupancy rates during the summer months, while certain other properties maintain higher occupancy rates during the winter months. This seasonality pattern can cause fluctuations in our quarterly revenue. Quarterly revenue also may be adversely affected by renovations and repositionings, our managers’ effectiveness in generating business and by events beyond our control, such as pandemics, extreme weather conditions, natural disasters, terrorist attacks or alerts, civil unrest, government shutdowns, airline strikes or reduced airline capacity, economic factors and other considerations affecting travel. To the extent that cash flows from operations are insufficient during any quarter to enable us to make quarterly distributions to maintain our REIT status due to 8
Page 10
temporary or seasonal fluctuations in lease revenue, we expect to utilize cash on hand, cash generated through borrowings, and issuances of common stock to fund required distributions. However, we cannot make any assurances that we will make distributions in the future. ACCESS TO REPORTS AND OTHER INFORMATION We maintain a website at www.ahtreit.com. On our website, we make available free-of-charge our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and other reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act, as soon as reasonably practicable after we electronically file or furnish such material with the Securities and Exchange Commission (the “SEC”). All of our filed reports can also be obtained at the SEC’s website at www.sec.gov. In addition, our Code of Business Conduct and Ethics, Code of Ethics for the Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer, Corporate Governance Guidelines, and Board Committee Charters are also available free-of-charge on our website or can be made available in print upon request. A description of any substantive amendment or waiver of our Code of Business Conduct and Ethics or our Code of Ethics for the Chief Executive Officer, Chief Financial Officer and Chief Accounting Officer will be disclosed on our website under the Corporate Governance section. Any such description will be located on our website for a period of 12 months following the amendment or waiver. We also use our website to distribute company information, and such information may be deemed material. Accordingly, investors should monitor our website, in addition to our press releases, SEC filings and public conference calls and webcasts. The contents of our website are not, however, a part of this report. SHAREHOLDER RIGHTS PLAN On December 15, 2025, the Board declared a dividend of one preferred share purchase right (a “Right”) for each outstanding share of common stock, each Right initially representing the right to purchase from the Company one one thousandth of a share of Series N Junior Participating Preferred Stock, par value $0.01 per share, of the Company (the “Series N Preferred Stock”) at a price of $20.00 per one one- thousandth of a share of Series N Preferred Stock (the “Purchase Price”), subject to adjustment as provided in the Rights Agreement (defined below). The dividend was paid to holders of Common Stock of record as of 5:00 p.m. New York City time on December 26, 2025 (the “Record Date”). The description and terms of the Rights are set forth in a Rights Agreement, dated as of December 15, 2025, as the same may be amended from time to time (the “Rights Agreement”), between the Company and ComputerShare Trust Company, N.A., as rights agent. Rights were issued in respect of all outstanding shares of common stock on the Record Date, and will be issued for all shares of common stock issued after the Record Date and, subject to the terms described in the Rights Agreement, prior to the earliest of the Distribution Date (as defined below), the redemption of the Rights or the expiration of the Rights as provided by the Rights Agreement. The Rights Agreement is designed to prevent the Company from facing a substantial limitation on its ability to use its Tax Benefits (as such term is defined in the Rights Agreement) to offset potential future income taxes for federal income tax purposes and realize other efficiencies. Subject to certain exceptions specified in the Rights Agreement, the Rights will separate from the common stock and become exercisable at 5:00 p.m. New York City time on the next business day following the earlier of (i) the first date of public announcement by the Company that any person or group of affiliated or associated persons has become an Acquiring Person (as defined below) pursuant to the Rights Agreement, which announcement makes express reference to such status as an Acquiring Person pursuant to the Rights Agreement, or on such later date as the Board may fix by resolution adopted prior to date, or (ii) 10 business days after the date (prior to such time as any person or group of affiliated persons becomes an Acquiring Person), if any, as may be determined by action of the Board, in its sole discretion, following the commencement of, or public announcement of an intention to commence, a tender or exchange offer the consummation of which would result in any person or group of affiliated or associated persons becoming an Acquiring Person (the earlier of such dates being called the “Distribution Date”). A person or group of affiliated or associated persons becomes an “Acquiring Person” upon acquiring beneficial ownership of 4.99% or more of any class of Company Securities then outstanding, except in certain situations (including a person or group of affiliated or associated persons that as of December 15, 2025 had beneficial ownership of any class of Company Securities then outstanding in excess of such threshold unless and until such person or group becomes the beneficial owner of a percentage of any class of Company Securities outstanding that exceeds by 0.5% or more the percentage of any class of Company Securities outstanding that such person or group owned as of the first public announcement of the adoption of the Rights Agreement, and any person or group exempted by the Board). For purposes of the Rights Agreement, “Company Securities” means the common stock and any other interest that the Board determines would be treated as “stock” of the Company for purposes of Section 382 of the Code (including Treasury Regulation Sections 1.382-2(a)(3) and 1.382-2T(f)(18)). 9
Page 11
Until the Distribution Date (or earlier redemption or expiration of the Rights), the Rights will be transferred with and only with the common stock. As soon as practicable following the Distribution Date, separate certificates evidencing the Rights will be mailed to holders of record of the common stock as of the close of business on the Distribution Date and such separate right certificates alone will evidence the Rights. The Rights are not exercisable until the Distribution Date. Pursuant to the terms of the Rights Agreement, the Rights will expire on the earliest of (i) 5:00 p.m. New York City time on December 14, 2026, (ii) the effective date of the repeal of Section 382 of the Code or any successor statute if the Board determines in its sole discretion that the Rights Agreement is no longer necessary or desirable for the preservation of Tax Benefits, or (iii) the first day of a taxable year of the Company to which the Board determines in its sole discretion that no Tax Benefits may be carried forward, unless the Rights are earlier redeemed or exchanged by the Company, in each case as described below, or upon the occurrence of certain transactions. Because of the nature of the Series N Preferred Stock’s dividend, liquidation and voting rights, the value of the one one-thousandth interest in a share of Series N Preferred Stock purchasable upon exercise of each Right should approximate the value of one share of Common Stock. If issued, each Right, other than Rights beneficially owned by the Acquiring Person (which will thereupon become void) will become exercisable for common stock having a value equal to two times the exercise price of the Right. However, prior to exercise, a Right does not give its holder any rights as a stockholder of the Company, including without limitation any dividend, voting or liquidation rights. Item 1A. Risk Factors Summary Risk Factors Our business is subject to a number of risks, including risks that may prevent us from achieving our business objectives or may adversely affect our business, financial condition, results of operations, cash flows, and prospects. These risks are discussed more fully below and include, but are not limited to, risks related to: • general volatility of the capital markets and the market price of our common stock and preferred stock; • catastrophic events or geopolitical conditions, such as the conflict between Russia and Ukraine, the Israel-Palestine-Iran conflict, ongoing instability in Venezuela and changes to tariffs or trade policies; • availability, terms, and deployment of capital; • unanticipated increases in financing and other costs, including changes in interest rates or inflation; • actual and potential conflicts of interest with Ashford Inc. and its subsidiaries (including Ashford LLC, Remington Hospitality and Premier), Braemar, our executive officers and our non-independent directors; • changes in personnel of Ashford LLC or the lack of availability of qualified personnel; • changes in governmental regulations, accounting rules, tax rates and similar matters; • our ability to continue as a going concern as described in our financial statement footnotes and generate sufficient liquidity to satisfy our obligations as they become due; • legislative and regulatory changes, including changes to the Code, and related rules, regulations and interpretations governing the taxation of real estate investment trusts; • limitations imposed on our business and our ability to satisfy complex rules in order for us to qualify as a REIT for U.S. federal income tax purposes; • the Rights Agreement adopted in December 2025 to protect our Tax Benefits may delay or prevent unsolicited acquisitions of us, or may adversely affect the market for our common stock; • future sales and issuances of our common stock or other securities might result in dilution and could cause the price of our common stock to decline; and • we are not currently eligible to use our effective short form registration statement on Form S-3 or to file a new Form S-3, which may impair our capital raising activities. RISKS RELATED TO OUR BUSINESS A financial crisis, economic slowdown, pandemic or epidemic or other economically disruptive event may harm the operating performance of the hotel industry generally. If such events occur, we may be harmed by declines in occupancy, average daily room rates and/or other operating revenues. The performance of the lodging industry has been closely linked with the performance of the general economy and, specifically, growth in the U.S. gross domestic product. A majority of our hotels are classified as upscale and upper upscale. In an economic downturn, these types of hotels may be more susceptible to a decrease in revenue, as compared to hotels in other categories that have lower room rates. This characteristic may result from the fact that upscale and upper upscale hotels 10
Page 12
generally target business and high-end leisure travelers. In periods of economic difficulties or concerns with respect to communicable disease, business and leisure travelers may seek to reduce travel costs and/or health risks by limiting travel or seeking to reduce costs on their trips. Any economic recession will likely have an adverse effect on us. Economic conditions in the United States and geopolitical developments could have a material adverse impact on our earnings and financial condition. Our business could be adversely affected by unstable economic and political conditions within the United States and foreign jurisdictions and by geopolitical conflicts, such as the conflict between Russia and Ukraine, the Israel-Palestine-Iran conflict, and other regional or international tensions, including the ongoing uncertainty in Venezuela. Because economic conditions in the United States may affect demand within the hospitality industry, current and future economic conditions in the United States, including slower economic growth, stock market volatility, heightened inflationary pressures, recessionary concerns, or reduced consumer spending could have a material adverse impact on our earnings and financial condition. Economic conditions may be affected by numerous factors, including but not limited to, the pace of economic growth and/or recessionary pressures, inflation, increases in unemployment levels, energy prices, tariffs and trade barriers, changes in currency exchange rates, uncertainty regarding government fiscal, monetary, and tax policy, geopolitical events, regulatory developments, changes in U.S. foreign policy and the availability and cost of credit and interest rates. The U.S. government has imposed significant tariffs on imported goods, and additional tariffs or trade restrictions may be implemented in the future. On February 20, 2026, the United States Supreme Court issued a ruling striking down certain tariffs previously imposed under the International Emergency Economic Powers Act (“IEEPA”). Following the Supreme Court’s decision, the U.S. presidential administration announced its intention to invoke other laws to collect tariffs and announced new tariffs on imports from all countries, in addition to any existing non-IEEPA tariffs. These measures could strain international trade relations and increase the risk that foreign governments impose retaliatory tariffs or other restrictions on goods imported from the United States. There remains substantial uncertainty regarding the duration of existing and newly announced tariffs, potential changes or pauses to such tariffs, tariff levels, and whether further additional tariffs or other retaliatory actions may be imposed, modified, or suspended. Such actions may lead to higher costs for goods and services, supply chain disruptions, increased operational complexity and broader economic uncertainty, all of which could adversely affect our business and financial condition. Further, periodic impasses in the U.S. federal budget and appropriations process raise the risk of a partial or full U.S. government shutdown. A government shutdown could negatively impact economic conditions, consumer and business confidence, financial markets, and regulatory and administrative functions, which in turn could adversely affect us, delay government approvals or processes, and otherwise have a material adverse effect on our business, results of operations, and financial condition. Our cash, cash equivalents and investments could be adversely affected if the financial institutions in which we hold our cash, cash equivalents and investments fail. We regularly maintain cash balances at third-party financial institutions in excess of the Federal Deposit Insurance Corporation (the “FDIC”) insurance limit. If our financial institutions enter receivership or become insolvent in the future in response to financial conditions affecting the banking system and financial markets, our ability to access our existing cash, cash equivalents and investments may be threatened and could have a material adverse effect on our business and financial condition. The hotel industry is highly competitive and the hotels in which we invest are subject to competition from other hotels for guests. The hotel business is highly competitive. Our hotel properties will compete on the basis of location, brand, room rates, quality, amenities, reputation and reservations systems, among many factors. There are many competitors in the hotel industry, and many of these competitors may have substantially greater marketing and financial resources than we have. This competition could reduce occupancy levels and rooms revenue at our hotels. Over-building in the lodging industry may increase the number of rooms available and may decrease occupancy and room rates. In addition, in periods of weak demand, as may occur during a general economic recession, profitability is negatively affected by the fixed costs of operating hotels. We also face competition from services such as home sharing companies and apartment operators offering short-term rentals. We did not pay cash dividends on our common stock in fiscal year 2025. We do not expect to pay cash dividends on our common stock for the foreseeable future. We did not pay cash dividends on our common stock in fiscal year 2025. We do not expect to pay cash dividends on our common stock for the foreseeable future. We do not anticipate paying any cash dividends on our outstanding common stock for 11
Page 13
any quarter during 2026. The board of directors will continue to review our dividend policy and make future announcements with respect thereto. Under Maryland law and except for an ability to pay a dividend out of current earnings in certain limited circumstances, no dividend (except a dividend in shares of stock) may be declared or paid by a Maryland corporation unless, after giving effect to the dividend, assets will continue to exceed liabilities and the corporation will be able to continue to pay its debts as they become due in the usual course. Maryland law permits these determinations to be made by our board of directors based on either a book value basis or a reasonable fair value basis. As of December 31, 2025, the Company had a deficit in stockholders’ equity of approximately $626.4 million and had not generated current earnings from which a dividend is potentially payable since the year ended December 31, 2015. There is no expectation that a dividend on common stock can or would be considered or declared at any time in the foreseeable future. Because we depend upon our advisor and its affiliates to conduct our operations, any adverse changes in the financial condition of our advisor or its affiliates or our relationship with them could hinder our operating performance. We depend on our advisor or its affiliates to manage our assets and operations. Any adverse changes in the financial condition of our advisor or its affiliates or our relationship with them could hinder their ability to manage us and our operations successfully. We depend on our advisor’s key personnel with longstanding business relationships. The loss of our advisor’s key personnel could threaten our ability to operate our business successfully. Our future success depends, to a significant extent, upon the continued services of our advisor’s management team and the extent and nature of the relationships they have developed with hotel franchisors, operators, and owners and hotel lending and other financial institutions. The loss of services of one or more members of our advisor’s management team could harm our business and our prospects. We do not have any employees, and rely on our hotel managers to employ the personnel required to operate the hotels we own. As a result, we cannot control staffing at our hotels than we would if we employed such personnel directly. We do not have any employees. We contractually engage hotel managers, such as Marriott, Hilton, Hyatt and our affiliate, Remington Hospitality, which is owned by Ashford Inc., to operate, and to employ the personnel required to operate our hotels. The hotel manager is required under the applicable hotel management agreement to determine appropriate staffing levels; we are required to reimburse the applicable hotel manager for the cost of these employees. As a result, we are dependent on our hotel managers to make appropriate staffing decisions and to appropriately reduce staffing when market conditions are poor, and we cannot reduce staffing at our hotels as we would if we employed such personnel directly. As a result, our hotels may be staffed at a level higher than we would choose if we employed the personnel required to operate the hotels. In addition, we may be less likely to take aggressive actions (such as delaying payments owed to our hotel managers) in order to influence the staffing decisions made by Remington Hospitality, which is our affiliate. We are required to make minimum base advisory fee payments to our advisor, Ashford Inc., under our advisory agreement, which must be paid even if our total market capitalization and performance decline. Similarly, we are required to make minimum base hotel management fee payments under our hotel management agreements with Remington Hospitality, a subsidiary of Ashford Inc., which must be paid even if revenues at our hotels decline significantly. Pursuant to the advisory agreement between us and our advisor, we must pay our advisor on a monthly basis a base advisory fee (based on our total market capitalization and the amount of sold assets) subject to a minimum base advisory fee. The minimum base advisory fee is equal to the greater of (i) 90% of the base fee paid for the same month in the prior fiscal year; and (ii) 1/12 of the “G&A Ratio” for the most recently completed fiscal quarter multiplied by our total market capitalization on the last balance sheet date included in the most recent quarterly report on Form 10-Q or annual report on Form 10-K that we file with the SEC. Thus, even if our total market capitalization and performance decline, we will still be required to make monthly payments to our advisor equal to the minimum base advisory fee, which could adversely impact our liquidity and financial condition. Similarly, pursuant to our hotel management agreement with Remington Hospitality, a subsidiary of Ashford Inc., we pay Remington Hospitality monthly base hotel management fees on a per hotel basis equal to the greater of approximately $18,000 (increased annually based on consumer price index adjustments) or 3% of gross revenues. As a result, even if revenues at our hotels decline significantly, we will still be required to make minimum monthly payments to Remington Hospitality equal to approximately $18,000 per hotel (increased annually based on consumer price index adjustments), which could adversely impact our liquidity and financial condition. th 12
Page 14
Our joint venture investments could be adversely affected by our lack of sole decision-making authority, our reliance on a co- venturer’s financial condition and disputes between us and our co-venturers. We have in the past and may continue to co-invest with third parties through partnerships, joint ventures or other entities, acquiring controlling or non-controlling interests in, or sharing responsibility for, managing the affairs of a property, partnership, joint venture or other entity. In such event, we may not be in a position to exercise sole decision-making authority regarding the property, partnership, joint venture or other entity. Investments in partnerships, joint ventures or other entities may, under certain circumstances, involve risks not present were a third party not involved, including the possibility that partners or co-venturers might become bankrupt, suffer a deterioration in their financial condition or fail to fund their share of required capital contributions. Partners or co-venturers may have economic or other business interests or goals that are inconsistent with our business interests or goals, and may be in a position to take actions contrary to our policies or objectives. Such investments may also have the potential risk of impasses on decisions, such as a sale, budgets, or financing, if neither we nor the partner or co-venturer has full control over the partnership or joint venture. Disputes between us and partners or co- venturers may result in litigation or arbitration that would increase our expenses and prevent our officers or directors from focusing their time and effort on our business. Consequently, actions by, or disputes with, partners or co-venturers might result in subjecting properties owned by the partnership or joint venture to additional risk. In addition, we may in certain circumstances be liable for the actions of our third-party partners or co-venturers. Our business strategy depends on our continued growth. We may fail to integrate recent and additional investments into our operations or otherwise manage our future growth, which may adversely affect our operating results. We cannot assure you that we will be able to adapt our management, administrative, accounting, and operational systems, or our advisor will be able to hire and retain sufficient operational staff to successfully integrate and manage any future acquisitions of additional assets without operating disruptions or unanticipated costs. Acquisitions of any property or additional portfolios of properties could generate additional operating expenses for us. Any future acquisitions may also require us to enter into property improvement plans that will increase our use of cash and could disrupt performance. As we acquire additional assets, we will be subject to the operational risks associated with owning those assets. Our failure to successfully integrate any future acquisitions into our portfolio could have a material adverse effect on our results of operations and financial condition and our ability to pay dividends to our stockholders. Because our board of directors and our advisor have broad discretion to make future investments, we may make investments that result in returns that are substantially below expectations or that result in net operating losses. Our board of directors and our advisor have broad discretion, within the investment criteria established by our board of directors, to make additional investments and to determine the timing of such investments. In addition, our investment policies may be revised from time to time at the discretion of our board of directors, without a vote of our stockholders, including with respect to our dividend policies on our common and preferred stock. Such discretion could result in investments with returns inconsistent with expectations. Hotel franchise or license requirements or the loss of a franchise could adversely affect us. We must comply with operating standards, terms, and conditions imposed by the franchisors of the hotel brands under which our hotels operate. Franchisors periodically inspect their licensed hotels to confirm adherence to their operating standards. The failure of a hotel to maintain standards could result in the loss or cancellation of a franchise license. With respect to operational standards, we rely on our hotel managers to conform to such standards. At times we may not be in compliance with such standards. Franchisors may also require us to make certain capital improvements to maintain the hotel in accordance with system standards, the cost of which can be substantial. It is possible that a franchisor could condition the continuation of a franchise based on the completion of capital improvements that our advisor or board of directors determines is not economically feasible in light of general economic conditions, the operating results or prospects of the affected hotel or other circumstances. In that event, our advisor or board of directors may elect to allow the franchise to lapse or be terminated, which could result in a termination charge as well as a change in brand franchising or operation of the hotel as an independent hotel. In addition, when the term of a franchise expires, the franchisor has no obligation to issue a new franchise. The loss of a franchise could have a material adverse effect on the operations and/or the underlying value of the affected hotel because of the loss of associated name recognition, marketing support and centralized reservation systems provided by the franchisor. 13
Page 15
We may be unable to identify additional investments that meet our investment criteria or to acquire the properties we have under contract. We cannot assure you that we will be able to identify real estate investments that meet our investment criteria, that we will be successful in completing any investment we identify, or that any investment we complete will produce a return on our investment. Moreover, we have broad authority to invest in any real estate investments that we may identify in the future. We also cannot assure you that we will acquire properties we currently have under firm purchase contracts, if any, or that the acquisition terms we have negotiated will not change. Our investments are concentrated in particular segments of a single industry. Nearly all of our business is hotel related. Our current strategy is predominantly to acquire upper upscale hotels, as well as when conditions are favorable to acquire first mortgages on hotel properties, invest in other mortgage-related instruments such as mezzanine loans to hotel owners and operators, and participate in hotel sale-leaseback transactions. Adverse conditions in the hotel industry will have a material adverse effect on our operating and investment revenues and cash available for distribution to our stockholders. Our reliance on Remington Hospitality, a subsidiary of Ashford Inc., and on third party hotel managers to operate our hotels and for a substantial majority of our cash flow may adversely affect us. Because U.S. federal income tax laws restrict REITs and their subsidiaries from operating or managing hotels, third parties must operate our hotels. A REIT may lease its hotels to taxable REIT subsidiaries in which the REIT can own up to a 100% interest. A taxable REIT subsidiary (“TRS”) pays corporate-level income tax and may retain any after-tax income. A REIT must satisfy certain conditions to use the TRS structure. One of those conditions is that the TRS must hire, to manage the hotels, an “eligible independent contractor” (“EIC”) that is actively engaged in the trade or business of managing hotels for parties other than the REIT. An EIC cannot (i) own more than 35% of the REIT, (ii) be owned more than 35% by persons owning more than 35% of the REIT, or (iii) provide any income to the REIT (i.e., the EIC cannot pay fees to the REIT, and the REIT cannot own any debt or equity securities of the EIC). Accordingly, while we may lease hotels to a TRS that we own, the TRS must engage a third-party operator to manage the hotels. Thus, our ability to direct and control how our hotels are operated is less than if we were able to manage our hotels directly. As of December 31, 2025, we have entered into management agreements with Remington Hospitality, a subsidiary of Ashford Inc., to manage 50 of our 68 hotel properties. We have hired unaffiliated third-party hotel managers to manage our remaining properties. We do not supervise any of the hotel managers or their respective personnel on a day-to-day basis, and we cannot assure you that the hotel managers will manage our properties in a manner that is consistent with their respective obligations under the applicable management agreement or our obligations under our hotel franchise agreements. We also cannot assure you that our hotel managers will not be negligent in their performance, will not engage in criminal or fraudulent activity, or will not otherwise default on their respective management obligations to us. If any of the foregoing occurs, our relationships with any franchisors may be damaged, we may be in breach of our franchise agreement, and we could incur liabilities resulting from loss or injury to our property or to persons at our properties. In addition, from time to time, disputes may arise between us and our third-party managers regarding their performance or compliance with the terms of the hotel management agreements, which in turn could adversely affect us. We generally will attempt to resolve any such disputes through discussions and negotiations; however, if we are unable to reach satisfactory results through discussions and negotiations, we may choose to terminate our management agreement, litigate the dispute or submit the matter to third-party dispute resolution, the expense of which may be material and the outcome of which may adversely affect us. Our cash flow from the hotels may be adversely affected if our managers fail to provide quality services and amenities or if they or their affiliates fail to maintain a quality brand name. In addition, our managers or their affiliates may manage, and in some cases may own, invest in or provide credit support or operating guarantees, to hotels that compete with hotel properties that we own or acquire, which may result in conflicts of interest and decisions regarding the operation of our hotels that are not in our best interests. Any of these circumstances could adversely affect us. Our management agreements could adversely affect our sale or financing of hotel properties. We have entered into management agreements, and acquired properties subject to management agreements, that do not allow us to replace hotel managers on relatively short notice or with limited cost or contain other restrictive covenants, and we may enter into additional such agreements or acquire properties subject to such agreements in the future. For example, the terms of a management agreement may restrict our ability to sell a property unless the purchaser is not a competitor of the manager, assumes the management agreement and meets other conditions. Also, the terms of a long-term management agreement encumbering our property may reduce the value of the property. When we enter into or acquire properties subject to any such 14
Page 16
management agreements, we may be precluded from taking actions in our best interest and could incur substantial expense as a result of the agreements. If we cannot obtain additional capital, our growth will be limited. We are required to distribute to our stockholders at least 90% of our REIT taxable income, excluding net capital gains, each year to maintain our qualification as a REIT. As a result, our retained earnings available to fund acquisitions, development, or other capital expenditures are nominal. As such, we rely upon the availability of additional debt or equity capital to fund these activities. Our long-term ability to grow through acquisitions or development, which is an important strategy for us, will be limited if we cannot obtain additional financing or equity capital. Market conditions may make it difficult to obtain financing or equity capital, and we cannot assure you that we will be able to obtain additional debt or equity financing or that we will be able to obtain it on favorable terms. We compete with other hotels for guests and face competition for acquisitions and sales of hotel properties and of desirable debt investments. The hotel business is competitive. Our hotels compete on the basis of location, room rates, quality, service levels, amenities, loyalty programs, reputation and reservation systems, among many other factors. New hotels may be constructed and these additions to supply create new competitors, in some cases without corresponding increases in demand for hotel rooms. The result in some cases may be lower revenue, which would result in lower cash available to meet debt service obligations, operating expenses and requisite distributions to our stockholders. We compete for hotel acquisitions with entities that have similar investment objectives as we do. This competition could limit the number of suitable investment opportunities offered to us. It may also increase the bargaining power of property owners seeking to sell to us, making it more difficult for us to acquire new properties on attractive terms or on the terms contemplated in our business plan. In addition, we compete to sell hotel properties. Availability of capital, the number of hotels available for sale and market conditions all affect prices. We may not be able to sell hotel assets at our targeted price. We may also compete for mortgage asset investments with numerous public and private real estate investment vehicles, such as mortgage banks, pension funds, other REITs, institutional investors, and individuals. Mortgages and other investments are often obtained through a competitive bidding process. In addition, competitors may seek to establish relationships with the financial institutions and other firms from which we intend to purchase such assets. Competition may result in higher prices for mortgage assets, lower yields, and a narrower spread of yields over our borrowing costs. Some of our competitors are larger than us, may have access to greater capital, marketing, and other financial resources, may have personnel with more experience than our officers, may be able to accept higher levels of debt or otherwise may tolerate more risk than us, may have better relations with hotel franchisors, sellers or lenders, and may have other advantages over us in conducting certain business and providing certain services. We face risks related to changes in the domestic and global political and economic environment, including capital and credit markets. Our business may be impacted by domestic and global economic conditions. Political crises in the U.S. and other international countries or regions, including sovereign risk related to a deterioration in the creditworthiness or a default by local governments, may negatively affect global economic conditions and our business. If the U.S. or global economy experiences volatility or significant disruptions, such disruptions or volatility could hurt the U.S. economy and our business could be negatively impacted by reduced demand for business and leisure travel related to a slowdown in the general economy, by disruptions resulting from credit markets, higher operating costs and by liquidity issues resulting from an inability to access credit markets to obtain cash to support operations. We are increasingly dependent on information technology, and cyber-attacks, security problems, artificial intelligence-related risks, or other disruption and expanding social media vehicles present new risks. Ashford LLC and our hotel managers rely on information technology networks and systems, including the Internet, to process, transmit and store electronic information, and to manage or support a variety of business processes, including financial transactions and records, personal identifying information, reservations, billing and operating data. We are also increasingly exposed to risks associated with the use of artificial intelligence (“AI”) and machine learning technologies, both as tools we and/or our hotel managers may adopt to improve operations. The collection and use of personally identifiable information is governed by federal and state laws and regulations. Privacy and information security laws continue to evolve and may be inconsistent from one jurisdiction to another. The regulatory landscape governing AI is also rapidly developing, with new federal and state laws, regulatory guidance, and international frameworks emerging that may impose additional compliance 15
Page 17
obligations on us. Compliance with all such laws and regulations may increase the Company’s operating costs and adversely impact the Company’s ability to market the Company’s properties and services. Ashford LLC and our hotel managers may purchase some of our information technology from vendors, on whom our systems will depend, and Ashford LLC relies on commercially available systems, software, tools and monitoring to provide security for processing, transmission and storage of confidential operator and other customer information. This includes systems that may incorporate AI or machine learning capabilities, which may introduce additional risks, including algorithmic errors, biased outputs, unintended data exposure, or vulnerabilities that could be exploited by third parties. We depend upon the secure transmission of this information over public networks. Ashford LLC’s and hotel managers’ networks and storage applications could be subject to unauthorized access by hackers or others through cyber-attacks, which are rapidly evolving and becoming increasingly sophisticated, including through the use of AI-enabled tools that allow malicious actors to identify vulnerabilities, automate attacks, generate convincing phishing or social engineering content, or bypass traditional security controls, or by other means, or may be breached due to operator error, malfeasance or other system disruptions. Privacy and information security risks have generally increased in recent years because of the proliferation of new technologies, such as ransomware and AI-powered attack tools, and the increased sophistication and activities of perpetrators of cyber-attacks. Further, there has been a surge in widespread cyber-attacks during and since the COVID-19 pandemic, and the use of remote work environments and virtual platforms may increase our risk of cyber-attack or data security breaches. In light of the increased risks, including due to the increased remote access associated with work-from-home arrangements as a result of the COVID-19 pandemic, Ashford LLC has dedicated additional resources on our behalf to strengthen the security of our computer systems. In the future, Ashford LLC may expend additional resources on our behalf to continue to enhance our information security measures and/or to investigate and remediate any information security vulnerabilities. We may also incur costs related to evaluating, adopting, or monitoring AI technologies and ensuring their responsible use in compliance with applicable law. Despite these steps, there can be no assurance that we will not suffer a significant data security incident in the future, that unauthorized parties will not gain access to sensitive data stored on our systems, that AI systems we or our vendors use will perform as intended without error or bias, or that any such incident will be discovered in a timely manner. In addition, the use of social media or AI technologies could cause us to suffer brand damage or information leakage. Negative posts or comments about us, our hotel managers or our hotels on any social networking website could damage our or our hotels’ reputations. In addition, employees or others might disclose non-public sensitive information relating to our business through external media channels or inadvertently through the use of AI tools. The continuing evolution of social media and AI will present us with new challenges and risks. Changes in laws, regulations, or policies may adversely affect our business. The laws and regulations governing our business or the regulatory or enforcement environment at the federal level or in any of the states in which we operate may change at any time and may have an adverse effect on our business. We are unable to predict how this or any other future legislative or regulatory proposals or programs will be administered or implemented or in what form, or whether any additional or similar changes to statutes or regulations, including the interpretation or implementation thereof, will occur in the future. Any such action could affect us in substantial and unpredictable ways and could have an adverse effect on our results of operations and financial condition. Our inability to remain in compliance with regulatory requirements in a particular jurisdiction could have a material adverse effect on our operations in that market and on our reputation generally. No assurance can be given that applicable laws or regulations will not be amended or construed differently or that new laws and regulations will not be adopted, either of which could materially adversely affect our business, financial condition or results of operations. We may experience losses caused by severe weather conditions or natural disasters. Our properties are susceptible to extreme weather conditions, which may cause property damage or interrupt business, which could harm our business and results of operations. Certain of our hotels are located in areas that may be subject to extreme weather conditions, including, but not limited to, hurricanes, floods, tornados and winter storms in the United States. Such extreme weather conditions may interrupt our operations, damage our hotels, and reduce the number of guests who visit our hotels in such areas. In addition, our operations could be adversely impacted by a drought or other cause of water shortage. A severe drought of extensive duration experienced in California or in the other regions in which we operate or source critical supplies could adversely affect our business. Over time, these conditions could result in declining hotel demand, significant damage to our properties or our inability to operate the affected hotels at all. We believe that our properties are adequately insured, consistent with industry standards, to cover reasonably anticipated losses that may be caused by hurricanes, earthquakes, tornados, floods and other severe weather conditions and natural disasters. Nevertheless, we are subject to the risk that such insurance will not fully cover all losses and, depending on the severity of the event and the impact on our properties, such insurance may not cover a significant portion of the losses including 16
Page 18
but not limited to the costs associated with evacuation. These losses may lead to an increase in our cost of insurance, a decrease in our anticipated revenues from an affected property or a loss of all or a portion of the capital we have invested in an affected property. In addition, we may not purchase insurance under certain circumstances if the cost of insurance exceeds, in our judgment, the value of the coverage relative to the risk of loss. Our financial statements contain a statement regarding a substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements included herein have been prepared on a going concern basis, which assumes that we will continue to operate in the normal course of business. Our anticipated debt service costs, debt maturities and the potential termination fee the Company would owe to Ashford LLC upon the triggering of the change of control provision in the Advisory Agreement resulted in uncertainty as to whether the Company’s current liquidity position will be adequate to sustain ongoing operational needs for one year from the issuance of the financial statements included herein. We have $1.9 billion of non-recourse loans that mature within one year from the date the financial statements are issued. If these loans are not refinanced and our lenders elect to foreclose on these properties, the change of control provision in the Advisory Agreement could be triggered beginning November 16, 2026 resulting in a termination fee (as defined in the Advisory Agreement). As a result of these factors, our notes to our financial statements include a qualification as to a substantial doubt about our ability to continue as a going concern over the next twelve months. Our ability to continue as a going concern is dependent upon our ability to improve the profitability of our operations, refinance or extend the maturity of our loans and increase our cash position from the sale of certain hotel properties. While we are taking several steps to reduce our cash utilization and potentially raise additional capital, there can be no assurances as to the certainty or timing of management’s plans, as certain elements of management’s plans are outside our control, including our ability to sell assets or successfully refinance or restructure certain of our debt obligations. We cannot reasonably guarantee that our business will generate sufficient cash flows from operations, or that future capital will be available to us, in an amount sufficient to fund our future liquidity needs and to make the required payment on our indebtedness. In the absence of adequate cash from operations and/or other available capital resources, we could face substantial liquidity constraints. To the extent that we cannot repay or refinance our indebtedness when due, or generate adequate cash flows from operations, we may have to curtail operations which would adversely affect our financial condition. The foregoing raises substantial doubt about our ability to continue as a going concern. The substantial doubt about our ability to continue as a going concern may negatively affect the price of our preferred or common stock and may make it challenging for us to issue additional debt on favorable terms to the extent necessary or desirable to increase our liquidity. RISKS RELATED TO OUR DEBT FINANCING We have a significant amount of debt, and our organizational documents have no limitation on the amount of additional indebtedness that we may incur in the future. As of December 31, 2025, our outstanding indebtedness consisted of approximately $2.6 billion in property-level debt, including approximately $2.4 billion of variable interest rate debt. We may also incur additional variable rate debt. In the future, we may incur additional indebtedness to finance future hotel acquisitions, capital improvements and development activities and other corporate purposes. Adverse conditions in credit markets or reduced availability of financing could limit our ability to refinance existing debt or obtain new debt on favorable terms, which may negatively impact our liquidity and financial flexibility. A substantial level of indebtedness could have adverse consequences for our business, results of operations and financial position because it could, among other things: • require us to dedicate a substantial portion of our cash flow from operations to make principal and interest payments on our indebtedness, thereby reducing our cash flow available to fund working capital, capital expenditures and other general corporate purposes, including to pay dividends on our common stock and our Preferred Stock as currently contemplated or necessary to satisfy the requirements for qualification as a REIT; • increase our vulnerability to general adverse economic and industry conditions and limit our flexibility in planning for, or reacting to, changes in our business and our industry; • limit our ability to borrow additional funds or refinance indebtedness on favorable terms or at all to expand our business or ease liquidity constraints; and • place us at a competitive disadvantage relative to competitors that have less indebtedness. 17
Page 19
Our Charter and bylaws do not limit the amount or percentage of indebtedness that we may incur, and we are subject to risks normally associated with debt financing. Generally, our mortgage debt carries maturity dates or call dates such that the loans become due prior to their full amortization. It may be difficult to refinance or extend the maturity of such loans on terms acceptable to us, or at all. These conditions could adversely affect our financial position, results of operations, and cash flows or the market price of our stock. Higher interest rates have increased our debt payments and such debt payments may remain high. As of December 31, 2025, our outstanding indebtedness consisted of approximately $2.6 billion in property-level debt, including approximately $2.4 billion of variable interest rate debt. Higher interest rates in the past few years have negatively impacted nearly all commercial real estate managers, including the Company. Higher interest rates have increased our interest costs on our variable-rate debt and could increase interest expense on any future fixed rate debt we may incur, and interest we pay reduces our cash available for distributions, expansion, working capital and other uses. Moreover, periods of rising interest rates heighten the risks described immediately above under “We have a significant amount of debt, and our organizational documents have no limitation on the amount of additional indebtedness that we may incur in the future.” We may enter into other transactions which could further exacerbate the risks to our financial condition. The use of debt to finance future acquisitions could restrict operations, inhibit our ability to grow our business and revenues, and negatively affect our business and financial results. We intend to incur additional debt in connection with future hotel acquisitions. We may incur mortgage debt by obtaining loans secured by a portfolio of some or all of the hotels that we own or acquire. If necessary or advisable, we also may borrow funds to make distributions to our stockholders to maintain our qualification as a REIT for U.S. federal income tax purposes. To the extent that we incur debt in the future and do not have sufficient funds to repay such debt at maturity, it may be necessary to refinance the debt through debt or equity financings, which may not be available on acceptable terms or at all and which could be dilutive to our stockholders. If we are unable to refinance our debt on acceptable terms or at all, we may be forced to dispose of hotels at inopportune times or on disadvantageous terms, which could result in losses. To the extent we cannot meet our future debt service obligations, we will risk losing to foreclosure some or all of our hotels that may be pledged to secure our obligation. Covenants, “cash trap” provisions or other terms in our mortgage loans, as well as any future credit facility, could limit our flexibility and adversely affect our financial condition or our qualification as a REIT. Some of our loan agreements contain financial and other covenants. If we violate covenants in any debt agreements, we could be required to repay all or a portion of our indebtedness before maturity at a time when we might be unable to arrange financing for such repayment on attractive terms, if at all. Violations of certain debt covenants may also prohibit us from borrowing unused amounts under our lines of credit, even if repayment of some or all the borrowings is not required. In addition, financial covenants under our current or future debt obligations could impair our planned business strategies by limiting our ability to borrow beyond certain amounts or for certain purposes. Some of our loan agreements also contain cash trap provisions that are triggered if the performance of our hotels decline. When these provisions are triggered, substantially all of the profit generated by our hotels is deposited directly into lockbox accounts and then swept into cash management accounts for the benefit of our various lenders. Cash is not distributed to us at any time after the cash trap provisions have been triggered until we have cured performance issues. This could affect our liquidity and our ability to make distributions to our stockholders. If we are not able to make distributions to our stockholders, we may not qualify as a REIT. As of December 31, 2025, 43 of our hotels are in cash traps. There is refinancing risk associated with our debt. We finance our long-term growth and liquidity needs with debt financings having staggered maturities, and use variable-rate debt or a mix of fixed and variable-rate debt as appropriate based on favorable interest rates, principal amortization and other terms. In the event that we do not have sufficient funds to repay the debt at the maturity of these loans, we will need to refinance this debt. If the credit environment is constrained at the time of our debt maturities, we would have a very difficult time refinancing debt. When we refinance our debt, prevailing interest rates and other factors may result in paying a greater amount of debt service, which will adversely affect our cash flow, and, consequently, our cash available for distribution to our stockholders. If we are unable to refinance our debt on acceptable terms, we may be forced to choose from a number of unfavorable options. These options include agreeing to otherwise unfavorable financing terms on one or more of our unencumbered assets, selling one or more hotels on disadvantageous terms, including unattractive prices or defaulting on the mortgage and permitting the lender to foreclose. Any one of these options could have a material adverse effect on our business, 18
Page 20
financial condition, results of operations and our ability to make distributions to our stockholders. If we sell a hotel, the required loan repayment may exceed the sale proceeds. Our hedging strategies may not be successful in mitigating our risks associated with interest rates and could reduce the overall returns on an investment in our Company. We may use various financial instruments, including derivatives, to provide a level of protection against interest rate increases and other risks, but no hedging strategy can protect us completely. These instruments involve risks, such as the risk that the counterparties may fail to honor their obligations under these arrangements, that these arrangements may not be effective in reducing our exposure to interest rate changes or other risks and that a court could rule that such agreements are not legally enforceable. These instruments may also generate income that may not be treated as qualifying REIT income. In addition, the nature and timing of hedging transactions may influence the effectiveness of our hedging strategies. Poorly designed strategies or improperly executed transactions could actually increase our risk and losses. Moreover, hedging strategies involve transaction and other costs. We cannot assure you that our hedging strategy and the instruments that we use will adequately offset the risk of interest rate volatility or other risks or that our hedging transactions will not result in losses that may reduce the overall return on your investment. We may not be able to raise capital through financing activities and may have difficulties negotiating with lenders in times of distress due to our complex structure and property-level indebtedness. Substantially all of our assets are encumbered by property-level indebtedness; therefore, we may be limited in our ability to raise additional capital through property-level or other financings. In addition, our ability to raise additional capital could be limited to refinancing existing secured mortgages before their maturity date which may result in yield maintenance or other prepayment penalties to the extent that the mortgage is not open for prepayment at par. Due to these limitations on our ability to raise additional capital, we may face difficulties obtaining liquidity and negotiating with lenders in times of distress. Adverse conditions in credit markets or tightening lending standards could further limit our ability to raise capital or refinance existing obligations on favorable terms. RISKS RELATED TO HOTEL INVESTMENTS We are subject to general risks associated with operating hotels. We own hotel properties, which have different economic characteristics than many other real estate assets, and a hotel REIT is structured differently than many other types of REITs. A typical office property, for example, has long-term leases with third-party tenants, which provide a relatively stable long-term revenue stream. Hotels, on the other hand, generate revenue from guests who typically stay at the hotel for only a few nights, which causes the room rate and occupancy levels at each of our hotels to change every day, and results in earnings that can be highly volatile. In addition, our hotels are subject to various operating risks common to the hotel industry, many of which are beyond our control, and are discussed in more detail below. These factors could adversely affect our hotel revenues and expenses, as well as the hotels underlying our mortgage and mezzanine loans, which in turn could adversely affect our financial condition, results of operations, the market price of our common stock and our ability to make distributions to our stockholders. Declines in or disruptions to the travel industry could adversely affect our business and financial performance. Our business and financial performance are affected by the health of the worldwide travel industry. Travel expenditures are sensitive to personal and business-related discretionary spending levels, tending to decline or grow more slowly during economic downturns, as well as to disruptions due to other factors, including those discussed below. Decreased travel expenditures could reduce the demand for our services, thereby causing a reduction in revenue. For example, during regional or global recessions, domestic and global economic conditions can deteriorate rapidly, resulting in increased unemployment and a reduction in expenditures for both business and leisure travelers. A slower spending rate on the services we provide could have a negative impact on our revenue growth. Other factors that could negatively affect our business include: terrorist incidents and threats and associated heightened travel security measures; political and regional strife; acts of God such as earthquakes, hurricanes, fires, floods, volcanoes and other natural disasters; war; concerns with or threats of pandemics, contagious diseases or health epidemics, such as COVID-19, Ebola, H1N1 influenza (swine flu), MERS, SARs, avian flu, the Zika virus or similar outbreaks; environmental disasters; lengthy power outages; increased pricing, financial instability and capacity constraints of air carriers; airline job actions and strikes; fluctuations in hotel supply, occupancy and ADR; changes to visa and immigration requirements or border control policies; imposition of taxes or surcharges by regulatory authorities; and increases in gasoline and other fuel prices. 19
Page 21
Because these events or concerns, and the full impact of their effects, are largely unpredictable, they can dramatically and suddenly affect travel behavior by consumers and decrease demand. Any decrease in demand, depending on its scope and duration, together with any future issues affecting travel safety, could significantly and adversely affect our business, working capital and financial performance over the short and long-term. In addition, the disruption of the existing travel plans of a significant number of travelers upon the occurrence of certain events, such as severe weather conditions, actual or threatened terrorist activity, war or travel-related health events, could result in significant additional costs and decrease our revenues, in each case, leading to constrained liquidity. Some of our hotels are subject to ground leases; if we are found to be in breach of a ground lease or are unable to renew a ground lease, our business could be materially and adversely affected. Some of our hotels are on land subject to ground leases, at least three of which cover the entire property. Accordingly, we only own a long-term leasehold rather than a fee simple interest, with respect to all or a portion of the real property at these hotels. If we fail to make a payment on a ground lease or are otherwise found to be in breach of a ground lease, we could lose the right to use the hotel or portion of the hotel property that is subject to the ground lease. In addition, unless we can purchase the fee simple interest in the underlying land and improvements or extend the terms of these ground leases before their expiration, we will lose our right to operate these properties and our interest in the improvements upon expiration of the ground leases. We may not be able to renew any ground lease upon its expiration or if renewed, the terms may not be favorable. Our ability to exercise any extension options relating to our ground leases is subject to the condition that we are not in default under the terms of the ground lease at the time that we exercise such options. If we lose the right to use a hotel due to a breach or non-renewal of the ground lease, we would be unable to derive income from such hotel and would need to purchase an interest in another hotel to attempt to replace that income, which could materially and adversely affect our business, operating results and prospects. Our ability to refinance a hotel property subject to a ground lease may be negatively impacted as the ground lease expiration date approaches. Market conditions or changes in property values could also impact our ability to renew ground leases on favorable terms. We may have to make significant capital expenditures to maintain our hotel properties, and any development activities we undertake may be more costly than we anticipate. Our hotels have an ongoing need for renovations and other capital improvements, including replacements, from time to time, of furniture, fixtures and equipment (“FF&E”). Managers or franchisors of our hotels also will require periodic capital improvements pursuant to the management agreements or as a condition of maintaining franchise licenses. Generally, we are responsible for the cost of these capital improvements. We may also develop hotel properties, timeshare units or other alternate uses of portions of our existing properties, including the development of retail, residential, office or apartments, including through joint ventures. Such renovation and development involves substantial risks, including: • construction cost overruns and delays; • the disruption of operations at, displacement of revenue at and damage to our operating hotels, including revenue lost while rooms, restaurants or meeting space under renovation are out of service; • increases in operating costs at our hotels, to the extent they rely on portions of development sites for hotel operations; • the cost of funding renovations or developments and inability to obtain financing on attractive terms; • the return on our investment in these capital improvements or developments failing to meet expectations; • governmental restrictions on the nature or size of a project; • inability to obtain all necessary zoning, land use, building, occupancy, and construction permits; • loss of substantial investment in a development project if a project is abandoned before completion; • acts of God such as earthquakes, hurricanes, floods or fires that could adversely affect a project; • environmental problems; • disputes with franchisors or hotel managers regarding compliance with relevant franchise agreements or management agreements; and • development-related liabilities, such as claims for design/construction defects; • supply chain disruptions or labor shortages could further increase costs or delay completion of renovations or development projects. If we have insufficient cash flow from operations to fund needed capital expenditures, then we will need to obtain additional debt or equity financing to fund future capital improvements, and we may not be able to meet the loan covenants in any financing obtained to fund the new development, creating default risks. 20
Page 22
In addition, to the extent that developments are conducted through joint ventures, this creates additional risks, including the possibility that our partners may not meet their financial obligations or could have or develop business interests, policies or objectives that are inconsistent with ours. See “Our joint venture investments could be adversely affected by our lack of sole decision-making authority, our reliance on a co-venturer’s financial condition and disputes between us and our co-venturers.” Any of the above factors could affect adversely our and our partners’ ability to complete the developments on schedule and along the scope that currently is contemplated, or to achieve the intended value of these projects. For these reasons, there can be no assurances as to the value to be realized by the Company from these transactions or any future similar transactions. The hotel business is seasonal, which affects our results of operations from quarter to quarter. The hotel industry is seasonal in nature. This seasonality can cause quarterly fluctuations in our financial condition and operating results, including in any distributions on our common stock. Our quarterly operating results may be adversely affected by factors outside our control, including weather conditions and poor economic factors in certain markets in which we operate. We can provide no assurances that our cash flows will be sufficient to offset any shortfalls that occur as a result of these fluctuations. As a result, we may have to reduce distributions or enter into short-term borrowings in certain quarters in order to make distributions to our stockholders, and we can provide no assurances that such borrowings will be available on favorable terms, if at all. The cyclical nature of the lodging industry may cause fluctuations in our operating performance, which could have a material adverse effect on us. The lodging industry historically has been highly cyclical in nature. Fluctuations in lodging demand and, therefore, hotel operating performance, are caused largely by general economic and local market conditions, which subsequently affect levels of business and leisure travel. In addition to general economic conditions, new hotel room supply is an important factor that can affect the lodging industry’s performance, and overbuilding has the potential to further exacerbate the negative impact of an economic recession. Room rates and occupancy, and thus RevPAR, tend to increase when demand growth exceeds supply growth. We can provide no assurances regarding whether, or the extent to which, lodging demand will exceed supply and if so, for what period of time. An adverse change in lodging fundamentals could result in returns that are substantially below our expectations or result in losses, which could have a material adverse effect on us. Many real estate costs are fixed, even if revenue from our hotels decreases. Many costs, such as real estate taxes, insurance premiums and maintenance costs, generally are not reduced even when a hotel is not fully occupied, room rates decrease or other circumstances cause a reduction in revenues. In addition, newly acquired or renovated hotels may not produce the revenues we anticipate immediately, or at all, and the hotel’s operating cash flow may be insufficient to pay the operating expenses and debt service associated with these new hotels. If we are unable to offset real estate costs with sufficient revenues across our portfolio, we may be adversely affected. Our operating expenses may increase in the future which could cause us to raise our room rates, which may deplete room occupancy, or cause us to realize lower net operating income as a result of increased expenses that are not offset by increased room rates, in either case decreasing our cash flow and our operating results. Operating expenses, such as expenses for fuel, utilities, labor and insurance, are not fixed and may increase in the future. To the extent such increases affect our room rates and therefore our room occupancy at our lodging properties, our cash flow and operating results may be negatively affected. The increasing use of internet travel intermediaries by consumers may adversely affect our profitability. Some of our hotel rooms are booked through internet travel intermediaries. As internet bookings increase, these intermediaries may be able to obtain higher commissions, reduced room rates or other significant contract concessions from our management companies. Moreover, some of these internet travel intermediaries are attempting to offer hotel rooms as a commodity, by increasing the importance of price and general indicators of quality at the expense of brand identification. These intermediaries may hope that consumers will eventually develop brand loyalties to their reservations system rather than to the brands under which our properties are franchised. Although most of the business for our hotels is expected to be derived from traditional channels, if the amount of sales made through Internet intermediaries increases significantly, rooms revenue may be lower than expected, and we may be adversely affected. 21
Page 23
We may be adversely affected by increased use of business-related technology, which may reduce the need for business-related travel. The increased use of teleconference and video-conference technology by businesses could result in decreased business travel as companies increase the use of technologies that allow multiple parties from different locations to participate at meetings without traveling to a centralized meeting location. To the extent that such technologies play an increased role in day-to-day business and the necessity for business-related travel decreases, hotel room demand may decrease and we may be adversely affected. Our hotels may be subject to unknown or contingent liabilities which could cause us to incur substantial costs. The hotel properties that we own or may acquire are or may be subject to unknown or contingent liabilities for which we may have no recourse, or only limited recourse, against the sellers. In general, the representations and warranties provided under the transaction agreements related to the sales of the hotel properties may not survive the closing of the transactions. While we will seek to require the sellers to indemnify us with respect to breaches of representations and warranties that survive, such indemnification may be limited and subject to various materiality thresholds, a significant deductible or an aggregate cap on losses. As a result, there is no guarantee that we will recover any amounts with respect to losses due to breaches by the sellers of their representations and warranties. In addition, the total amount of costs and expenses that may be incurred with respect to liabilities associated with these hotels may exceed our expectations, and we may experience other unanticipated adverse effects, all of which may adversely affect our financial condition, results of operations, the market price of our common stock and our ability to make distributions to our stockholders. Future terrorist attacks or changes in terror alert levels could materially and adversely affect us. Previous terrorist attacks and subsequent terrorist alerts have adversely affected the U.S. travel and hospitality industries since 2001, often disproportionately to the effect on the overall economy. The extent of the impact that actual or threatened terrorist attacks in the U.S. or elsewhere could have on domestic and international travel and our business in particular cannot be determined, but any such attacks or the threat of such attacks could have a material adverse effect on travel and hotel demand, our ability to finance our business and our ability to insure our hotels, which could materially adversely affect us. During 2025, approximately 15% of our total hotel revenue was generated from nine hotels located in the Washington D.C. area, one of several key U.S. markets considered vulnerable to terrorist attack. Our financial and operating performance may be adversely affected by potential terrorist attacks. Terrorist attacks in the future may cause our results to differ materially from anticipated results. Hotels we own in other market locations may be subject to this risk as well. We are subject to risks associated with the employment of hotel personnel, particularly with hotels that employ unionized labor. Our managers, including Remington Hospitality, a subsidiary of Ashford Inc., and unaffiliated third-party managers are responsible for hiring and maintaining the labor force at each of our hotels. Although we do not directly employ or manage employees at our hotels, we still are subject to many of the costs and risks generally associated with the hotel labor force, particularly at those hotels with unionized labor. From time to time, hotel operations may be disrupted as a result of strikes, lockouts, public demonstrations or other negative actions and publicity. We also may incur increased legal costs and indirect labor costs as a result of contract disputes involving our managers and their labor force or other events. The resolution of labor disputes or re-negotiated labor contracts could lead to increased labor costs, a significant component of our hotel operating costs, either by increases in wages or benefits or by changes in work rules that raise hotel operating costs. We do not have the ability to affect the outcome of these negotiations. Our third party managers may also be unable to hire quality personnel to adequately staff hotel departments, which could result in a sub-standard level of service to hotel guests and hotel operations. Hotels where our managers have collective bargaining agreements with their employees are more highly affected by labor force activities than others. The resolution of labor disputes or re-negotiated labor contracts could lead to increased labor costs, either by increases in wages or benefits or by changes in work rules that raise hotel operating costs. Furthermore, labor agreements may limit the ability of our hotel managers to reduce the size of hotel workforces during an economic downturn because collective bargaining agreements are negotiated between the hotel managers and labor unions. Our ability, if any, to have any material impact on the outcome of these negotiations is restricted by and dependent on the individual management agreement covering a specific property, and we may have little ability to control the outcome of these negotiations. In addition, changes in labor laws may negatively impact us. For example, the implementation of new occupational health and safety regulations, minimum wage laws, and overtime, working conditions status and citizenship requirements and the Department of Labor’s proposed regulations expanding the scope of non-exempt employees under the Fair Labor Standards Act 22
Page 24
to increase the entitlement to overtime pay could significantly increase the cost of labor in the workforce, which would increase the operating costs of our hotel properties and may have a material adverse effect on us. RISKS RELATED TO CONFLICTS OF INTEREST Our agreements with our external advisor and its subsidiaries, as well as our mutual exclusivity agreement and management agreements with Remington Hospitality and Premier, subsidiaries of Ashford Inc., were not negotiated on an arm’s-length basis, and we may pursue less vigorous enforcement of their terms because of conflicts of interest with certain of our executive officers and directors and key employees of our advisor. Because each of our executive officers are also key employees of our advisor, Ashford LLC, a subsidiary of Ashford Inc. and have ownership interests in Ashford Inc. and because the chairman of our board of directors has an ownership interest in Ashford Inc., our advisory agreement, our master hotel management agreement and hotel management mutual exclusivity agreement with Remington Hospitality, a subsidiary of Ashford Inc., and our master project management agreement and project management mutual exclusivity agreement with Premier, a subsidiary of Ashford Inc., among other agreements between us and subsidiaries of Ashford Inc. were not negotiated on an arm’s-length basis, and we did not have the benefit of arm’s-length negotiations of the type normally conducted with an unaffiliated third party. As a result, the terms, including fees and other amounts payable, may not be as favorable to us as an arm’s-length agreement. Furthermore, we may choose not to enforce, or to enforce less vigorously, our rights under these agreements because of our desire to maintain our ongoing relationship with our advisor and its subsidiaries (including Ashford LLC, Remington Hospitality and Premier). The termination fee payable to our advisor significantly increases the cost to us of terminating our advisory agreement, thereby effectively limiting our ability to terminate our advisor without cause and could make a change of control transaction less likely or the terms thereof less attractive to us and to our stockholders. The initial term of our advisory agreement with our advisor is 10 years from the effective date of the advisory agreement, subject to an extension by our advisor for up to 7 successive additional 10-year renewal terms thereafter. The board of directors will review our advisor’s performance and fees annually and, following the 10-year initial term, may elect to renegotiate the amount of fees payable under the advisory agreement in certain circumstances. Additionally, if we undergo a change of control transaction, we will have the right to terminate the advisory agreement with the payment of the termination fee described below. If we terminate the advisory agreement without cause or upon a change of control, we will be required to pay our advisor a termination fee equal to: • (A) 1.1 multiplied by the greater of (i) 12 times the net earnings of our advisor for the 12 month period preceding the termination date of the advisory agreement; (ii) the earnings multiple (calculated as our advisor’s total enterprise value on the trading day immediately preceding the day the termination notice is given to our advisor divided by our advisor’s most recently reported adjusted earnings before interest, tax, depreciation and amortization (“Adjusted EBITDA”)) for our advisor’s common stock for the 12 month period preceding the termination date of the advisory agreement multiplied by the net earnings of our advisor for the 12 month period preceding the termination date of the advisory agreement; or (iii) the simple average of the earnings multiples for each of the three fiscal years preceding the termination of the advisory agreement (calculated as our advisor’s total enterprise value on the last trading day of each of the three preceding fiscal years divided by, in each case, our advisor’s Adjusted EBITDA for the same periods), multiplied by the net earnings of our advisor for the 12 month period preceding the termination date of the advisory agreement; plus • (B) an additional amount such that the total net amount received by our advisor after the reduction by state and U.S. federal incometaxes at an assumed combined rate of 40% on the sum of the amounts described in (A) and (B) shall equal the amount described in (A);provided, that, the minimum amount of any termination fee calculated as of any date of determination shall be the greater of (i) the feethat would have been payable had such termination fee been calculated as of December 31, 2025 and (ii) the fee calculated as of suchdate of determination. Any such termination fee will be payable on or before the termination date. Moreover, our advisor is entitled to set off, take and apply any of our money on deposit in any of our bank, brokerage or similar accounts (all of which are controlled by, and in the name of, our advisor) to amounts we owe to our advisor, including amounts we would owe to our advisor in respect of the termination fee, and in certain circumstances permits our advisor to escrow any money in such accounts into a termination fee escrow account (to which we would not have access) even prior to the time that the termination fee is payable. The termination fee makes it more difficult for us to terminate our advisory agreement. These provisions significantly increase the cost to us of terminating our advisory agreement, thereby limiting our ability to terminate our advisor without cause. 23
Page 25
Our advisor manages other entities and may direct attractive investment opportunities away from us. If we change our investment guidelines, our advisor is not restricted from advising clients with similar investment guidelines. Our executive officers also serve as key employees and as officers of our advisor and Braemar, and will continue to do so. Furthermore, Mr. Monty J. Bennett, our chairman, is also the chief executive officer, chairman and a significant stockholder of our advisor and is the chairman of Braemar. Our advisory agreement requires our advisor to present investments that satisfy our investment guidelines to us before presenting them to Braemar or any future client of our advisor. Additionally, in the future our advisor may advise other clients, some of which may have investment guidelines substantially similar to ours. Some portfolio investment opportunities may include hotels that satisfy our investment objectives as well as hotels that satisfy the investment objectives of Braemar or other entities advised by our advisor. If the portfolio cannot be equitably divided, our advisor will necessarily have to make a determination as to which entity will be presented with the opportunity. In such a circumstance, our advisory agreement requires our advisor to allocate portfolio investment opportunities between us, Braemar or other entities advised by our advisor in a fair and equitable manner, consistent with our, Braemar’s and such other entities’ investment objectives. In making this determination, our advisor, using substantial discretion, will consider the investment strategy and guidelines of each entity with respect to acquisition of properties, portfolio concentrations, tax consequences, regulatory restrictions, liquidity requirements and other factors deemed appropriate. In making the allocation determination, our advisor has no obligation to make any such investment opportunity available to us. Further, our advisor and Braemar have agreed that any new investment opportunities that satisfy our investment guidelines will be presented to our board of directors; however, our board of directors will have only ten business days to make a determination with respect to such opportunity prior to it being available to Braemar. The above mentioned dual responsibilities may create conflicts of interest for our officers which could result in decisions or allocations of investments that may benefit one entity more than the other. Our advisor and its key employees, most of whom are Braemar’s and Ashford Inc.’s and our executive officers, face competing demands relating to their time and this may adversely affect our operations. We rely on our advisor and its employees for the day-to-day operation of our business. Certain key employees of our advisor are executive officers of Braemar and Ashford Inc. Because our advisor’s key employees have duties to Braemar and Ashford Inc., as well as to our company, we do not have their undivided attention and they face conflicts in allocating their time and resources between our company Braemar and Ashford Inc. Our advisor may also manage other entities in the future. During turbulent market conditions or other times when we need focused support and assistance from our advisor, other entities for which our advisor also acts as an external advisor will likewise require greater focus and attention as well, placing competing high levels of demand on the limited time and resources of our advisor’s key employees. Additionally, activist investors have, and in the future, may commence campaigns seeking to influence other entities advised by our advisor to take particular actions favored by the activist or gain representation on the board of directors of such entities, which could result in additional disruption and diversion of management’s attention. We may not receive the necessary support and assistance we require or would otherwise receive if we were internally managed by persons working exclusively for us. Conflicts of interest could result in our management acting other than in our stockholders’ best interest. Conflicts of interest in general and specifically relating to Ashford Inc. and its subsidiaries (including Ashford LLC, Remington Hospitality and Premier) may lead to management decisions that are not in the stockholders’ best interest. The chairman of our board of directors, Mr. Monty J. Bennett, is the chairman, chief executive officer and a significant stockholder of Ashford Inc. and Mr. Archie Bennett, Jr., who is our chairman emeritus, is a significant stockholder of Ashford Inc. As of December 31, 2025, Remington Hospitality managed 50 of our 68 hotel properties and provides other services. Mr. Monty J. Bennett is chairman and chief executive officer of Ashford Inc. and, together with his father Mr. Archie Bennett, Jr., as of December 31, 2025, holds a controlling interest in Ashford Inc. As of December 31, 2025, the Bennetts owned approximately 809,937 shares of Ashford Inc. common stock, which represented an approximate 51.9% ownership interest in Ashford Inc., and owned 18,758,600 shares of Ashford Inc. Series D Convertible Preferred Stock, which, along with all unpaid accrued and accumulated dividends thereon, was convertible (at a conversion price of $117.50 per share) into an additional approximate 4,573,359 shares of Ashford Inc. common stock, which if converted as of December 31, 2025, would have increased the Bennetts’ ownership interest in Ashford Inc. to 87.8%. The 18,758,600 shares of Series D Convertible Preferred Stock owned by Mr. Monty J. Bennett and Mr. Archie Bennett, Jr. include 360,000 shares owned by trusts. Additionally, Mr. Monty J. Bennett acquired the right to direct votes, effective March 25, 2025, and as of December 31, 2025 those rights represented approximately 551,000 common shares. Messrs. Archie Bennett, Jr. and Monty J. Bennett’s ownership interests in, and Mr. Monty J. Bennett’s management obligations to, Ashford Inc. present them with conflicts of interest in making management decisions related to the commercial 24
Page 26
arrangements between us and Ashford Inc. Mr. Monty J. Bennett’s management obligations to Ashford Inc. (and his obligations to Braemar, where he also serves as chairman of the board of directors) reduce the time and effort he spends on us. Our board of directors has adopted a policy that requires all material approvals, actions or decisions to which we have the right to make under the master hotel management agreement with Remington Hospitality and the master project management agreement with Premier be approved by a majority or, in certain circumstances, all of our independent directors. However, given the authority and/or operational latitude provided to Remington Hospitality under the master hotel management agreement and to Premier under the master project management agreement, and Mr. Monty J. Bennett as the chairman and chief executive officer of Ashford Inc., could take actions or make decisions that are not in our stockholders’ best interest or that are otherwise inconsistent with the obligations to us under the master hotel management agreement or master project management agreement. Holders of units in our operating partnership, including members of our management team, may suffer adverse tax consequences upon our sale of certain properties. Therefore, holders of units, either directly or indirectly, including Messrs. Archie Bennett, Jr. and Monty J. Bennett may have different objectives regarding the appropriate pricing and timing of a particular property’s sale. These officers and directors of ours may influence us to sell, not sell, or refinance certain properties, even if such actions or inactions might be financially advantageous to our stockholders, or to enter into tax deferred exchanges with the proceeds of such sales when such a reinvestment might not otherwise be in our best interest. We are a party to a master hotel management agreement and a hotel management exclusivity agreement with Remington Hospitality and a master project management agreement and a project management exclusivity agreement with Premier, which describes the terms of Remington Hospitality’s and Premier’s, respectively, services to our hotels, as well as any future hotels we may acquire that may or may not be property managed by Remington Hospitality or project managed by Premier. The exclusivity agreements requires us to engage Remington Hospitality for hotel management and Premier for design and construction services, respectively, unless, in each case, our independent directors either: (i) unanimously vote to hire a different manager or developer; or (ii) by a majority vote, elect not to engage Remington Hospitality or Premier, as the case may be, because they have determined that special circumstances exist or that, based on Remington Hospitality’s or Premier’s prior performance, another manager or developer could perform the duties materially better. As significant owners of Ashford Inc., which would receive any development, management, and management termination fees payable by us under the management agreements, Mr. Monty J. Bennett, and to a lesser extent, Mr. Archie Bennett, Jr., in his role as chairman emeritus, may influence our decisions to sell, acquire, or develop hotels when it is not in the best interests of our stockholders to do so. Ashford Inc.’s ability to exercise significant influence over the determination of the competitive set for any hotels managed by Remington Hospitality could artificially enhance the perception of the performance of a hotel, making it more difficult to use managers other than Remington Hospitality for future properties. Our hotel management mutual exclusivity agreement with Remington requires us to engage Remington Hospitality to manage all future properties that we acquire, to the extent we have the right or control the right to direct such matters, unless our independent directors either: (i) unanimously vote not to hire Remington Hospitality or (ii) based on special circumstances or past performance, by a majority vote, elect not to engage Remington Hospitality because they have determined, in their reasonable business judgment, that it would be in our best interest not to engage Remington Hospitality or that another manager or developer could perform the duties materially better. Under our master hotel management agreement with Remington Hospitality, we have the right to terminate Remington Hospitality based on the performance of the applicable hotel, subject to the payment of a termination fee. The determination of performance is based on the applicable hotel’s gross operating profit margin and its RevPAR penetration index, which provides the relative revenue per room generated by a specified property as compared to its competitive set. For each hotel managed by Remington Hospitality, its competitive set will consist of a small group of hotels in the relevant market that we and Remington Hospitality believe are comparable for purposes of benchmarking the performance of such hotel. Remington Hospitality will have significant influence over the determination of the competitive set for any of our hotels managed by Remington Hospitality, and as such could artificially enhance the perception of the performance of a hotel by selecting a competitive set that is not performing well or is not comparable to the Remington Hospitality- managed hotel, thereby making it more difficult for us to elect not to use Remington Hospitality for future hotel management. Under the terms of our hotel management mutual exclusivity agreement with Remington Hospitality, Remington Hospitality may be able to pursue lodging investment opportunities that compete with us. Pursuant to the terms of our hotel management mutual exclusivity agreement with Remington Hospitality, if investment opportunities that satisfy our investment criteria are identified by Remington Hospitality or its affiliates, Remington Hospitality will give us a written notice and description of the investment opportunity. We will have 10 business days to either accept or reject the investment opportunity. If we reject the opportunity, Remington Hospitality may then pursue such investment opportunity, subject to a right of first refusal in favor of Braemar, pursuant to an existing agreement between Braemar and Remington Hospitality, on materially the same terms and conditions as offered to us. If we were to reject such an investment 25
Page 27
opportunity, either Braemar or Remington Hospitality could pursue the opportunity and compete with us. In such a case, Mr. Monty J. Bennett, our chairman, in his capacity as chairman of Braemar or chief executive officer of Ashford Inc. could be in a position of directly competing with us. Our fiduciary duties as the general partner of our operating partnership could create conflicts of interest, which may impede business decisions that could benefit our stockholders. We, as the general partner of our operating partnership, have fiduciary duties to the other limited partners in our operating partnership, the discharge of which may conflict with the interests of our stockholders. The limited partners of our operating partnership have agreed that, in the event of a conflict in the fiduciary duties owed by us to our stockholders and, in our capacity as general partner of our operating partnership, to such limited partners, we are under no obligation to give priority to the interests of such limited partners. In addition, those persons holding common units will have the right to vote on certain amendments to the operating partnership agreement (which require approval by a majority in interest of the limited partners, including us) and individually to approve certain amendments that would adversely affect their rights. These voting rights may be exercised in a manner that conflicts with the interests of our stockholders. For example, we are unable to modify the rights of limited partners to receive distributions as set forth in the operating partnership agreement in a manner that adversely affects their rights without their consent, even though such modification might be in the best interest of our stockholders. In addition, conflicts may arise when the interests of our stockholders and the limited partners of our operating partnership diverge, particularly in circumstances in which there may be an adverse tax consequence to the limited partners. Tax consequences to holders of common units upon a sale or refinancing of our properties may cause the interests of the key employees of our advisor (who are also our executive officers and have ownership interests in our operating partnership) to differ from our stockholders. Our policy regarding conflicts of interest may not adequately address all of the conflicts of interest that may arise with respect to our activities. In order to avoid any actual or perceived conflicts of interest with our directors or officers or our advisor’s employees, we adopted a policy regarding conflicts of interest to address specifically some of the conflicts relating to our activities. Although under this policy the approval of a majority of our disinterested directors is required to approve any transaction, agreement or relationship in which any of our directors or officers or our advisor or it has an interest, there is no assurance that this policy will be adequate to address all of the conflicts that may arise or will resolve such conflicts in a manner that is favorable to us. RISKS RELATED TO DERIVATIVE TRANSACTIONS We have engaged in and may continue to engage in derivative transactions, which can limit our gains and expose us to losses. We have entered into and may continue to enter into hedging transactions to: (i) attempt to take advantage of changes in prevailing interest rates; (ii) protect our portfolio of mortgage assets from interest rate fluctuations; (iii) protect us from the effects of interest rate fluctuations on floating-rate debt; (iv) protect us from the risk of fluctuations in the financial and capital markets; or (v) preserve net cash in the event of a major downturn in the economy. Our hedging transactions may include entering into interest rate swap agreements, interest rate cap or floor agreements or flooridor and corridor agreements, credit default swaps and purchasing or selling futures contracts, purchasing or selling put and call options on securities or securities underlying futures contracts, or entering into forward rate agreements. Hedging activities may not have the desired beneficial impact on our results of operations or financial condition. Volatile fluctuations in market conditions could cause these instruments to become ineffective. Any gains or losses associated with these instruments are reported in our earnings each period. No hedging activity can completely insulate us from the risks inherent in our business. Credit default hedging could fail to protect us or adversely affect us because if a swap counterparty cannot perform under the terms of our credit default swap, we may not receive payments due under such agreement and, thus, we may lose any potential benefit associated with such credit default swap. Additionally, we may also risk the loss of any cash collateral we have pledged to secure our obligations under such credit default swaps if the counterparty becomes insolvent or files for bankruptcy. Moreover, interest rate hedging could fail to protect us or adversely affect us because, among other things: • available interest rate hedging may not correspond directly with the interest rate risk for which protections is sought; • the duration of the hedge may not match the duration of the related liability; • the party owing money in the hedging transaction may default on its obligation to pay; 26
Page 28
• the credit quality of the party owing money on the hedge may be downgraded to such an extent that it impairs our ability to sell or assign our side of the hedging transaction; and • the value of derivatives used for hedging may be adjusted from time to time in accordance with generally accepted accounting principles (“GAAP”) to reflect changes in fair value and such downward adjustments, or “market-to-market loss,” would reduce our stockholders’ equity. Hedging involves both risks and costs, including transaction costs, which may reduce our overall returns on our investments. These costs increase as the period covered by the hedging relationship increases and during periods of rising and volatile interest rates. These costs will also limit the amount of cash available for distributions to stockholders. We generally intend to hedge to the extent management determines it is in our best interest given the cost of such hedging transactions as compared to the potential economic returns or protections offered. The REIT qualification rules may limit our ability to enter into hedging transactions by requiring us to limit our income and assets from hedges. If we are unable to hedge effectively because of the REIT rules, we will face greater interest rate exposure than may be commercially prudent. We are subject to the risk of default or insolvency by the hospitality entities underlying our investments. The leveraged capital structure of the hospitality entities underlying our investments will increase their exposure to adverse economic factors (such as changes in interest rates, competitive pressures, downturns in the economy or deterioration in the condition of the real estate industry) and to the risk of unforeseen events. If an underlying entity cannot generate adequate cash flow to meet such entity’s debt obligations (which may include leveraged obligations in excess of its aggregate assets), it may default on its loan agreements or be forced into bankruptcy. As a result, we may suffer a partial or total loss of the capital we have invested in the securities and other investments of such entity. The derivatives provisions of the Dodd-Frank Act and related rules could have an adverse effect on our ability to use derivative instruments to reduce the negative effect of interest rate fluctuations on our results of operations and liquidity, credit default risks and other risks associated with our business. The Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) establishes federal oversight and regulation of the over-the-counter derivatives market and entities, including us, that participate in that market. As required by the Dodd-Frank Act, the Commodities Futures Trading Commission (the “CFTC”), the SEC and other regulators have adopted certain rules implementing the swaps regulatory provisions of the Dodd-Frank Act and are in the process of adopting other rules to implement those provisions. Numerous provisions of the Dodd-Frank Act and the CFTC’s rules relating to derivatives that qualify as “swaps” thereunder apply or may apply to the derivatives to which we are or may become a counterparty. Under such statutory provisions and the CFTC’s rules, we must clear on a derivatives clearing organization any over-the-counter swap we enter into that is within a class of swaps designated for clearing by CFTC rule and execute trades in such cleared swap on an exchange if the swap is accepted for trading on the exchange unless such swap is exempt from such mandatory clearing and trade execution requirements. We may qualify for and intend to elect the end-user exception from those requirements for swaps we enter to hedge our commercial risks and that are subject to the mandatory clearing and trade execution requirements. If we are required to clear or voluntarily elect to clear any swaps we enter into, those swaps will be governed by standardized agreements and we will have to post margin with respect to such swaps. To date, the CFTC has designated only certain types of interest rate swaps and credit default swaps for clearing and trade execution. Although we believe that none of the interest rate swaps and credit default swaps to which we are currently party fall within those designated types of swaps, we may enter into swaps in the future that will be subject to the mandatory clearing and trade execution requirements and subject to the risks described. Rules recently adopted by banking regulators and the CFTC in accordance with a requirement of the Dodd-Frank Act require regulated financial institutions and swap dealers and major swap participants that are not regulated financial institutions to collect margin with respect to uncleared swaps to which they are parties and to which financial end users, among others, are their counterparties. We will qualify as a financial end user for purposes of such margin rules. We will not have to post initial margin with respect to our uncleared swaps under the new rules because we do not have material swaps exposure as defined in the new rules. However, we will be required to post variation margin (most likely in the form of cash collateral) with respect to each of our uncleared swaps subject to the new margin rules in an amount equal to the cumulative decrease in the market-to-market value of such swap to our counterparty as of any date of determination from the value of such swap as of the date of the swap’s execution. The SEC has proposed margin rules for security-based swaps to which regulated financial institutions are not counterparties. Those proposed rules differ from the CFTC’s margin rules, but the final form that those rules will take and their effect is uncertain at this time. The Dodd-Frank Act has caused certain market participants, and may cause other market participants, including the counterparties to our derivative instruments, to spin off some of their derivatives activities to separate entities. Those entities may not be as creditworthy as the historical counterparties to our derivatives. 27
Page 29
Some of the rules required to implement the swaps-related provisions of the Dodd-Frank Act remain to be adopted, and the CFTC has, from time to time, issued and may in the future issue interpretations and no-action letters interpreting, and clarifying the application of, those provisions and the related rules or delaying compliance with those provisions and rules. As a result, it is not possible at this time to predict with certainty the full effects of the Dodd-Frank Act, the CFTC’s rules and the SEC’s rules on us and the timing of such effects. The Dodd-Frank Act and the rules adopted thereunder could significantly increase the cost of derivative contracts (including from swap recordkeeping and reporting requirements and through requirements to post margin with respect to our swaps, which could adversely affect our available liquidity), materially alter the terms of derivative contracts, reduce the availability of derivatives to protect against risks we encounter, reduce our ability to monetize or restructure our existing derivative contracts, and increase our exposure to less creditworthy counterparties. If we reduce our use of derivatives as a result of the Dodd-Frank Act and the related rules, our results of operations may become more volatile and our cash flows may be less predictable, which could adversely affect our ability to plan for and fund capital expenditures and to pay dividends to our stockholders. Any of these consequences could have a material adverse effect on our consolidated financial position, results of operations and cash flows. The assets associated with certain of our derivative transactions may not constitute qualified REIT assets and the related income may not constitute qualified REIT income. Significant fluctuations in the value of such assets or the related income could jeopardize our REIT status or result in additional tax liabilities. We may enter into certain derivative transactions to protect against interest rate risks and credit default risks not specifically associated with debt incurred to acquire qualified REIT assets. The REIT provisions of the Code limit our income and assets in each year from such derivative transactions. Failure to comply with the asset or income limitation within the REIT provisions of the Code could result in penalty taxes or loss of our REIT status. If we elected to contribute non-qualifying derivatives into a TRS to preserve our REIT status, such an action could likely result in any income from such transactions being subject to U.S. federal income taxation. RISKS RELATED TO INVESTMENTS IN SECURITIES, MORTGAGES AND MEZZANINE LOANS Our earnings are dependent, in part, upon the performance of our investment portfolio. To the extent permitted by the Code, we may invest in and own securities of other public companies and REITs (including Braemar). To the extent that the value of those investments declines or those investments do not provide an attractive return, our earnings and cash flow could be adversely affected. Debt investments that are not United States government insured involve risk of loss. As part of our business strategy, we may originate or acquire lodging-related uninsured and mortgage assets, including mezzanine loans. While holding these interests, we are subject to risks of borrower defaults, bankruptcies, fraud and related losses, and special hazard losses that are not covered by standard hazard insurance. Also, costs of financing the mortgage loans could exceed returns on the mortgage loans. In the event of any default under mortgage loans held by us, we will bear the risk of loss of principal and non-payment of interest and fees to the extent of any deficiency between the value of the mortgage collateral and the principal amount of the mortgage loan. The value and the price of our securities may be adversely affected. We may invest in non-recourse loans, which will limit our recovery to the value of the mortgaged property. Our mortgage and mezzanine loan assets have typically been non-recourse. With respect to non-recourse mortgage loan assets, in the event of a borrower default, the specific mortgaged property and other assets, if any, pledged to secure the relevant mortgage loan, may be less than the amount owed under the mortgage loan. As to those mortgage loan assets that provide for recourse against the borrower and its assets generally, we cannot assure you that the recourse will provide a recovery in respect of a defaulted mortgage loan greater than the liquidation value of the mortgaged property securing that mortgage loan. Investment yields affect our decision whether to originate or purchase investments and the price offered for such investments. In making any investment, we consider the expected yield of the investment and the factors that may influence the yield actually obtained on such investment. These considerations affect our decision whether to originate or purchase an investment and the price offered for that investment. No assurances can be given that we can make an accurate assessment of the yield to be produced by an investment. Many factors beyond our control are likely to influence the yield on the investments, including, but not limited to, competitive conditions in the local real estate market, local and general economic conditions, and the quality 28
Page 30
of management of the underlying property. Our inability to accurately assess investment yields may result in our purchasing assets that do not perform as well as expected, which may adversely affect the price of our securities. Volatility of values of mortgaged properties may adversely affect our mortgage loans. Lodging property values and net operating income derived from lodging properties are subject to volatility and may be affected adversely by a number of factors, including the risk factors described herein relating to general economic conditions, operating lodging properties, and owning real estate investments. In the event its net operating income decreases, one of our borrowers may have difficulty paying our mortgage loan, which could result in losses to us. In addition, decreases in property values will reduce the value of the collateral and the potential proceeds available to our borrowers to repay our mortgage loans, which could also cause us to suffer losses. Mezzanine loans involve greater risks of loss than senior loans secured by income-producing properties. We may make and acquire mezzanine loans. These types of loans are considered to involve a higher degree of risk than long-term senior mortgage lending secured by income-producing real property due to a variety of factors, including the loan being entirely unsecured or, if secured, becoming unsecured as a result of foreclosure by the senior lender. We may not recover some or all of our investment in these loans. In addition, mezzanine loans may have higher loan-to-value ratios than conventional mortgage loans resulting in less equity in the property and increasing the risk of loss of principal. The assets associated with certain of our derivative transactions may not constitute qualified REIT assets and the related income may not constitute qualified REIT income. Significant fluctuations in the value of such assets or the related income could jeopardize our REIT status or result in additional tax liabilities. We may enter into certain derivative transactions to protect against interest rate risks and credit default risks not specifically associated with debt incurred to acquire qualified REIT assets. The REIT provisions of the Code limit our income and assets in each year from such derivative transactions. Failure to comply with the asset or income limitation within the REIT provisions of the Code could result in penalty taxes or loss of our REIT status. If we elected to contribute non-qualifying derivatives into a TRS to preserve our REIT status, such an action could likely result in any income from such transactions being subject to U.S. federal income taxation. Our prior investment performance is not indicative of future results. The performance of our prior investments is not necessarily indicative of the results that can be expected for the investments to be made by our subsidiaries. On any given investment, total loss of the investment is possible. Although our management team has experience and has had success in making investments in real estate-related lodging debt and hotel assets, the past performance of these investments is not necessarily indicative of the results of our future investments. Our investment portfolio will contain investments concentrated in a single industry and will not be fully diversified. We have formed subsidiaries for the primary purpose of acquiring securities and other investments of lodging-related entities. As such, our investment portfolio will contain investments concentrated in a single industry and may not be fully diversified by asset class, geographic region or other criteria, which will expose us to significant loss due to concentration risk. Investors have no assurance that the degree of diversification in our investment portfolio will increase at any time in the future. The values of our investments are affected by the U.S. credit and financial markets and, as such, may fluctuate. The U.S. credit and financial markets may experience severe dislocations and liquidity disruptions. The values of our investments are likely to be sensitive to the volatility of the U.S. credit and financial markets, and, to the extent that turmoil in the U.S. credit and financial markets occurs, such volatility has the potential to materially affect the value of our investment portfolio. We may invest in securities for which there is no liquid market, and we may be unable to dispose of such securities at the time or in the manner that may be most favorable to us, which may adversely affect our business. We may invest in securities for which there is no liquid market or which may be subject to legal and other restrictions on resale or otherwise be less liquid than publicly traded securities generally. The relative illiquidity of these investments may make it difficult for us to sell these investments when desired. In addition, if we are required to liquidate all or a portion of our portfolio quickly, we may realize significantly less than the value at which we had previously recorded these investments. Our investments may occasionally be subject to contractual or legal restrictions on resale or will be otherwise illiquid due to the fact that there is no established trading market for such securities, or such trading market is thinly traded. The relative illiquidity of such investments may make it difficult for us to dispose of them at a favorable price, and, as a result, we may suffer losses. 29
Page 31
RISKS RELATED TO THE REAL ESTATE INDUSTRY Illiquidity of real estate investments could significantly impede our ability to respond to adverse changes in the performance of our hotel properties and harm our financial condition. Because real estate investments are relatively illiquid, our ability to sell promptly one or more hotel properties or mortgage loans in our portfolio for reasonable prices in response to changing economic, financial, and investment conditions is limited. We may decide to sell hotel properties or loans in the future. We cannot predict whether we will be able to sell any hotel property or loan for the price or on the terms set by us, or whether any price or other terms offered by a prospective purchaser would be acceptable to us. We may sell a property at a loss as compared to carrying value. We also cannot predict the length of time needed to find a willing purchaser and to close the sale of a hotel property or loan. We may offer more flexible terms on our mortgage loans than some providers of commercial mortgage loans, and as a result, we may have more difficulty selling or participating our loans to secondary purchasers than would these more traditional lenders. We may be required to expend funds to correct defects or to make improvements before a property can be sold. We cannot assure you that we will have funds available to correct those defects or to make those improvements. In acquiring a hotel property, we may agree to lock-out provisions that materially restrict us from selling that property for a period of time or impose other restrictions, such as a limitation on the amount of debt that can be placed or repaid on that property. These and other factors could impede our ability to respond to adverse changes in the performance of our hotel properties or a need for liquidity. Increases in property taxes would increase our operating costs, reduce our income and adversely affect our ability to make distributions to our stockholders. Each of our hotel properties will be subject to real and personal property taxes. These taxes may increase as tax rates change and as the properties are assessed or reassessed by taxing authorities. If property taxes increase, our financial condition, results of operations and our ability to make distributions to our stockholders could be materially and adversely affected and the market price of our common and/or preferred stock could decline. The costs of compliance with or liabilities under environmental laws may harm our operating results. Operating expenses at our hotels could be higher than anticipated due to the cost of complying with existing or future environmental laws and regulations. In addition, our hotel properties and properties underlying our loan assets may be subject to environmental liabilities. An owner of real property, or a lender with respect to a party that exercises control over the property, can face liability for environmental contamination created by the presence or discharge of hazardous substances on the property. We may face liability regardless of: • our knowledge of the contamination; • the timing of the contamination; • the cause of the contamination; or • the party responsible for the contamination. There may be environmental problems associated with our hotel properties or properties underlying our loan assets of which we are unaware. Some of our hotel properties or the properties underlying our loan assets use, or may have used in the past, underground tanks for the storage of petroleum-based or waste products that could create a potential for release of hazardous substances. If environmental contamination exists on a hotel property, we could become subject to strict, joint and several liabilities for the contamination if we own the property or if we foreclose on the property or otherwise have control over the property. The presence of hazardous substances on a property we own or have made a loan with respect to may adversely affect our ability to sell, on favorable terms or at all, or foreclose on the property, and we may incur substantial remediation costs. The discovery of material environmental liabilities at our properties or properties underlying our loan assets could subject us to unanticipated significant costs. We generally have environmental insurance policies on each of our owned properties, and we intend to obtain environmental insurance for any other properties that we may acquire. However, if environmental liabilities are discovered during the underwriting of the insurance policies for any property that we may acquire in the future, we may be unable to obtain insurance coverage for the liabilities at commercially reasonable rates or at all, and we may experience losses. In addition, we 30
Page 32
generally do not require our borrowers to obtain environmental insurance on the properties they own that secure their loans from us. Numerous treaties, laws and regulations have been enacted to regulate or limit carbon emissions. Changes in the regulations and legislation relating to climate change, and complying with such laws and regulations, may require us to make significant investments in our hotels and could result in increased energy costs at our properties. Tax increases and changes in tax rules may adversely affect our financial results. As a company conducting business with physical operations throughout North America, we are exposed, both directly and indirectly, to the effects of changes in U.S., state and local tax rules. Taxes for financial reporting purposes and cash tax liabilities in the future may be adversely affected by changes in such tax rules. Such changes may put us at a competitive disadvantage compared to some of our major competitors, to the extent we are unable to pass the tax costs through to our customers. On July 4, 2025, the OBBBA was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The OBBBA did not have a material impact on the consolidated financial statements for the year ended December 31, 2025 and the Company will continue to monitor its impacts. Our properties and the properties underlying our mortgage loans may contain or develop harmful mold, which could lead to liability for adverse health effects and costs of remediating the problem. When excessive moisture accumulates in buildings or on building materials, mold growth may occur, particularly if the moisture problem remains undiscovered or is not addressed over a period of time. Some molds may produce airborne toxins or irritants. Concern about indoor exposure to mold has been increasing as exposure to mold may cause a variety of adverse health effects and symptoms, including allergic or other reactions. Some of the properties in our portfolio may contain microbial matter such as mold and mildew. As a result, the presence of significant mold at any of our properties or the properties underlying our loan assets could require us or our borrowers to undertake a costly remediation program to contain or remove the mold from the affected property. In addition, the presence of significant mold could expose us or our borrowers to liability from hotel guests, hotel employees, and others if property damage or health concerns arise. Compliance with the ADA and fire, safety, and other regulations may require us or our borrowers to incur substantial costs. All of our properties and properties underlying our mortgage loans are required to comply with the ADA. The ADA requires that “public accommodations” such as hotels be made accessible to people with disabilities. Compliance with the ADA’s requirements could require removal of access barriers and non-compliance could result in imposition of fines by the U.S. government or an award of damages to private litigants, or both. In addition, we and our borrowers are required to operate our properties in compliance with fire and safety regulations, building codes, and other land use regulations as they may be adopted by governmental agencies and bodies and become applicable to our properties. Any requirement to make substantial modifications to our hotel properties, whether to comply with the ADA or other changes in governmental rules and regulations, could be costly. We may obtain only limited warranties when we purchase a property and would have only limited recourse if our due diligence did not identify any issues that lower the value of our property, which could adversely affect our financial condition and ability to make distributions to our stockholders. We may acquire a hotel property in its “as is” condition on a “where is” basis and “with all faults,” without any warranties of merchantability or fitness for a particular use or purpose. In addition, purchase agreements may contain only limited warranties, representations and indemnifications that will only survive for a limited period after the closing, or provide a cap on the amount of damages we can recover. The purchase of properties with limited warranties increases the risk that we may lose some or all our invested capital in the property as well as the loss of income from that property. We may experience uninsured or underinsured losses. We have property and casualty insurance with respect to our hotel properties and other insurance, in each case, with loss limits and coverage thresholds deemed reasonable by our management team (and with the intent to satisfy the requirements of lenders and franchisors). In doing so, we have made decisions with respect to what deductibles, policy limits, and terms are 31
Page 33
reasonable based on management’s experience, our risk profile, the loss history of our hotel managers and our properties, the nature of our properties and our businesses, our loss prevention efforts, the cost of insurance and other factors. Various types of catastrophic losses may not be insurable or may not be economically insurable. In the event of a substantial loss, our insurance coverage may not cover the full current market value or replacement cost of our lost investment, including losses incurred in relation to the COVID-19 pandemic or cybersecurity incidents. Inflation, changes in building codes and ordinances, environmental considerations, and other factors might cause insurance proceeds to be insufficient to fully replace or renovate a hotel after it has been damaged or destroyed. Accordingly, there can be no assurance that: • the insurance coverage thresholds that we have obtained will fully protect us against insurable losses (i.e., losses may exceed coverage limits); • we will not incur large deductibles that will adversely affect our earnings; • we will not incur losses from risks that are not insurable or that are not economically insurable; or • current coverage thresholds will continue to be available at reasonable rates. In the future, we may choose not to maintain terrorism or other insurance policies on any of our properties. As a result, one or more large uninsured or underinsured losses could have a material adverse effect on us. Each of our current lenders requires us to maintain certain insurance coverage thresholds, and we anticipate that future lenders will have similar requirements. We believe that we have complied with the insurance maintenance requirements under the current governing loan documents and we intend to comply with any such requirements in any future loan documents. However, a lender may disagree, in which case the lender could obtain additional coverage thresholds and seek payment from us, or declare us in default under the loan documents. In the former case, we could spend more for insurance than we otherwise deem reasonable or necessary or, in the latter case, subject us to a foreclosure on hotels securing one or more loans. In addition, a material casualty to one or more hotels securing loans may result in the insurance company applying to the outstanding loan balance insurance proceeds that otherwise would be available to repair the damage caused by the casualty, which would require us to fund the repairs through other sources, or the lender foreclosing on the hotels if there is a material loss that is not insured. RISKS RELATED TO OUR STATUS AS A REIT If we do not qualify as a REIT, we will be subject to tax as a regular corporation and could face substantial tax liability. We conduct operations so as to qualify as a REIT under the Code. However, qualification as a REIT involves the application of highly technical and complex Code provisions for which only a limited number of judicial or administrative interpretations exist. Even a technical or inadvertent mistake could jeopardize our REIT status or we may be required to rely on a REIT “savings clause.” If we were to rely on a REIT “savings clause,” we could have to pay a penalty tax, which could be material. Due to the gain we recognized as a result of the spin- off of Braemar, if Braemar were to fail to qualify as a REIT for 2013, we may have failed to qualify as a REIT for 2013 and subsequent taxable years. Furthermore, new tax legislation, administrative guidance, or court decisions, in each instance potentially with retroactive effect, could make it more difficult or impossible for us to qualify as a REIT. If we fail to qualify as a REIT in any tax year, then: • we would be taxed as a regular domestic corporation, which, among other things, means being unable to deduct distributions to our stockholders in computing taxable income and being subject to U.S. federal income tax on our taxable income at regular corporate rates; • we would also be subject to increased state and local income taxes; • any resulting tax liability could be substantial and would reduce the amount of cash available for distribution to stockholders; and • unless we were entitled to relief under applicable statutory provisions, we would be disqualified from treatment as a REIT for the subsequent four taxable years following the year that we lost our qualification, and, thus, our cash available for distribution to stockholders could be reduced for each of the years during which we did not qualify as a REIT. If, as a result of covenants applicable to our future debt, we are restricted from making distributions to our stockholders, we may be unable to make distributions necessary for us to avoid U.S. federal corporate income and excise taxes and to qualify and maintain our qualification as a REIT, which could materially and adversely affect us. In addition, if we fail to qualify as a REIT, we will not be required to make distributions to stockholders to maintain our tax status. As a result of all of these factors, 32
Page 34
our failure to qualify as a REIT could impair our ability to raise capital, expand our business, and make distributions to our stockholders and could adversely affect the value of our securities. Even if we qualify and remain qualified as a REIT, we may face other tax liabilities that reduce our cash flow. Even if we qualify and remain qualified for taxation as a REIT, we may be subject to certain federal, state, and local taxes on our income and assets. For example: • We will be required to pay tax on undistributed REIT taxable income. • If we have net income from the disposition of foreclosure property held primarily for sale to customers in the ordinary course of business or other non-qualifying income from foreclosure property, we must pay tax on that income at the highest corporate rate. • If we sell a property in a “prohibited transaction,” our gain from the sale would be subject to a 100% penalty tax. • Each of our TRSs is a fully taxable corporation and will be subject to federal and state taxes on its income. • We may continue to experience increases in our state and local income tax burden. Over the past several years, certain state and local taxing authorities have significantly changed their income tax regimes in order to raise revenues. The changes enacted that have increased our state and local income tax burden include the taxation of modified gross receipts (as opposed to net taxable income), the suspension of and/or limitation on the use of net operating loss deductions, increases in tax rates and fees, the addition of surcharges, and the taxation of our partnership income at the entity level. Facing mounting budget deficits, more state and local taxing authorities have indicated that they are going to revise their income tax regimes in this fashion and/or eliminate certain federally allowed tax deductions such as the REIT dividends paid deduction. Further, while we have entered into a Rights Agreement designed to prevent the Company from facing a substantial limitation on its ability to use its Tax Benefits (as such term is defined in the Rights Agreement) to offset potential future income taxes for federal income tax purposes and realized other efficiencies, we cannot assure you that such Rights Agreement will be effective in protecting our valuable Tax Benefits. Failure to make required distributions would subject us to U.S. federal corporate income tax. We intend to operate in a manner that allows us to qualify as a REIT for U.S. federal income tax purposes. In order to continue to qualify as a REIT, we generally are required to distribute at least 90% of our REIT taxable income, determined without regard to the dividends paid deduction and excluding any net capital gain, each year to our stockholders. To the extent that we satisfy this distribution requirement, but distribute less than 100% of our REIT taxable income, we will be subject to U.S. federal corporate income tax on our undistributed taxable income. In addition, we will be subject to a 4% nondeductible excise tax if the actual amount that we pay out to our stockholders in a calendar year is less than a minimum amount specified under the Code. Our TRS lessee structure increases our overall tax liability. Our TRS lessees are subject to federal, state and local income tax on their taxable income, which consists of the revenues from the hotel properties leased by our TRS lessees, net of the operating expenses for such hotel properties and rent payments to us. Accordingly, although our ownership of our TRS lessees allows us to participate in the operating income from our hotel properties in addition to receiving fixed rent, the net operating income is fully subject to income tax. The after-tax net income of our TRS lessees is available for distribution to us. If our leases with our TRS lessees are not respected as true leases for U.S. federal income tax purposes, we would fail to qualify as a REIT. To qualify as a REIT, we are required to satisfy two gross income tests, pursuant to which specified percentages of our gross income must be passive income, such as rent. For the rent paid pursuant to the hotel leases with our TRS lessees, which constitutes substantially all of our gross income, to qualify for purposes of the gross income tests, the leases must be respected as true leases for U.S. federal income tax purposes and must not be treated as service contracts, joint ventures or some other type of arrangement. We have structured our leases, and intend to structure any future leases, so that the leases will be respected as true leases for U.S. federal income tax purposes, but the IRS may not agree with this characterization. If the leases were not respected as true leases for U.S. federal income tax purposes, we would not be able to satisfy either of the two gross income tests applicable to REITs and likely would fail to qualify as a REIT. 33
Page 35
Our ownership of TRSs is limited and our transactions with our TRSs will cause us to be subject to a 100% penalty tax on certain income or deductions if those transactions are not conducted on arm’s-length terms. A REIT may own up to 100% of the stock of one or more TRSs. A TRS may hold assets and earn income that would not be qualifying assets or income if held or earned directly by a REIT, including gross operating income from hotels that are operated by eligible independent contractors pursuant to hotel management agreements. Both the subsidiary and the REIT must jointly elect to treat the subsidiary as a TRS. A corporation of which a TRS directly or indirectly owns more than 35% of the voting power or value of the stock will automatically be treated as a TRS. Overall, no more than 20% of the value of a REIT’s assets may consist of stock or securities of one or more TRSs. In addition, the TRS rules limit the deductibility of interest paid or accrued by a TRS to its parent REIT to assure that the TRS is subject to an appropriate level of corporate taxation. The rules also impose a 100% excise tax on certain transactions between a TRS and its parent REIT that are not conducted on an arm’s-length basis. Finally, the 100% excise tax also applies to the underpricing of services by a TRS to its parent REIT in contexts where the services are unrelated to services for REIT tenants. Our TRSs are subject to federal, foreign, state and local income tax on their taxable income, and their after-tax net income is available for distribution to us but is not required to be distributed to us. We believe that the aggregate value of the stock and securities of our TRSs is less than 20% of the value of our total assets (including our TRS stock and securities). We monitor the value of our respective investments in our TRSs for the purpose of ensuring compliance with TRS ownership limitations. In addition, we scrutinize all of our transactions with our TRSs to ensure that they are entered into on arm’s-length terms to avoid incurring the 100% excise tax described above. For example, in determining the amounts payable by our TRSs under our leases, we engaged a third party to prepare transfer pricing studies to ascertain whether the lease terms we established are on an arm’s-length basis as required by applicable Treasury Regulations. However, the receipt of a transfer pricing study does not prevent the IRS from challenging the arm’s length nature of the lease terms between a REIT and its TRS lessees. Consequently, there can be no assurance that we will be able to avoid application of the 100% excise tax discussed above. If our hotel managers, including Ashford Hospitality Services LLC and its subsidiaries (including Remington Hospitality) do not qualify as “eligible independent contractors,” we would fail to qualify as a REIT. Rent paid by a lessee that is a “related party tenant” of ours is not qualifying income for purposes of the two gross income tests applicable to REITs. We lease all of our hotels to our TRS lessees. A TRS lessee will not be treated as a “related party tenant,” and will not be treated as directly operating a lodging facility, which is prohibited, to the extent the TRS lessee leases properties from us that are managed by an “eligible independent contractor.” We believe that the rent paid by our TRS lessees is qualifying income for purposes of the REIT gross income tests and that our TRSs qualify to be treated as TRSs for U.S. federal income tax purposes, but there can be no assurance that the IRS will not challenge this treatment or that a court would not sustain such a challenge. If we failed to meet either the asset or gross income tests, we would likely lose our REIT qualification for U.S. federal income tax purposes, unless certain of the REIT “savings clauses” applied. If our hotel managers, including Ashford Hospitality Services LLC (“AHS”) and its subsidiaries (including Remington Hospitality), do not qualify as “eligible independent contractors,” we would fail to qualify as a REIT. Each of the hotel management companies that enters into a management contract with our TRS lessees must qualify as an “eligible independent contractor” under the REIT rules in order for the rent paid to us by our TRS lessees to be qualifying income for our REIT income test requirements. Among other requirements, in order to qualify as an eligible independent contractor a manager must not own more than 35% of our outstanding shares (by value) and no person or group of persons can own more than 35% of our outstanding shares and the ownership interests of the manager, taking into account only owners of more than 5% of our shares and, with respect to ownership interests in such managers that are publicly-traded, only holders of more than 5% of such ownership interests. Complex ownership attribution rules apply for purposes of these 35% thresholds. Although we intend to monitor ownership of our shares by our hotel managers and their owners, there can be no assurance that these ownership levels will not be exceeded. Additionally, we and AHS and its subsidiaries, including Remington Hospitality, must comply with the provisions of the private letter ruling we obtained from the IRS in connection with Ashford Inc.’s acquisition of Remington Hospitality to ensure that AHS and its subsidiaries, including Remington Hospitality, continue to qualify as “eligible independent contractors.” Dividends payable by REITs do not qualify for the reduced tax rates available for some dividends. The maximum U.S. federal income tax rate applicable to “qualified dividend income” payable to U.S. stockholders that are taxed at individual rates is 20%. Dividends payable by REITs, however, generally are not eligible for this reduced maximum 34
Page 36
rate on qualified dividend income. However, under the Tax Cuts and Jobs Act a non-corporate taxpayer may deduct 20% of ordinary REIT dividends that are not “capital gain dividends” or “qualified dividend income” resulting in an effective maximum U.S. federal income tax rate of 29.6% (based on the current maximum U.S. federal income tax rate for individuals of 37%). Individuals, trusts and estates whose income exceeds certain thresholds are also subject to a 3.8% Medicare tax on dividends received from us. The more favorable rates applicable to regular corporate qualified dividends could cause investors who are taxed at individual rates to perceive investments in REITs to be relatively less attractive than investments in the stocks of non-REIT corporations that pay dividends, which could adversely affect the value of the shares of REITs, including our stock. If our operating partnership failed to qualify as a partnership for U.S. federal income tax purposes, we would cease to qualify as a REIT and would be subject to higher taxes and have less cash available for distribution to our stockholders and suffer other adverse consequences. We believe that our operating partnership qualifies to be treated as a partnership for U.S. federal income tax purposes. As a partnership, our operating partnership is not subject to U.S. federal income tax on its income. Instead, each of its partners, including us, is required to include in income its allocable share of the operating partnership’s income. No assurance can be provided, however, that the IRS will not challenge its status as a partnership for U.S. federal income tax purposes, or that a court would not sustain such a challenge. If the IRS were successful in treating our operating partnership as a corporation for tax purposes, we would fail to meet the gross income tests and certain of the asset tests applicable to REITs and, accordingly, cease to qualify as a REIT. Also, the failure of our operating partnership to qualify as a partnership would cause it to become subject to federal and state corporate income tax, which would reduce significantly the amount of cash available for debt service and for distribution to its partners, including us. Note that although partnerships have traditionally not been subject to U.S. federal income tax at the entity level as described above, new audit rules, will generally apply to the partnership. Under the new rules, unless an entity elects otherwise, taxes arising from audit adjustments are required to be paid by the entity rather than by its partners or members. We may utilize exceptions available under the new provisions (including any changes) and Treasury Regulations so that the partners, to the fullest extent possible, rather than the partnership itself, will be liable for any taxes arising from audit adjustments to the issuing entity’s taxable income. One such exception is to apply an elective alternative method under which the additional taxes resulting from the adjustment are assessed from the affected partners (often referred to as a “push-out election”), subject to a higher rate of interest than otherwise would apply. When a push-out election causes a partner that is itself a partnership to be assessed with its share of such additional taxes from the adjustment, such partnership may cause such additional taxes to be pushed out to its own partners. In addition, Treasury Regulations provide that a partner that is a REIT may be able to use deficiency dividend procedures with respect to such adjustments. Many questions remain as to how the partnership audit rules will apply, and it is not clear at this time what effect these rules will have on us. However, it is possible that these changes could increase the U.S. federal income tax, interest, and/or penalties otherwise borne by us in the event of a U.S. federal income tax audit of a subsidiary partnership (such as our operating partnership). Complying with REIT requirements may cause us to forgo otherwise attractive opportunities. To qualify as a REIT for U.S. federal income tax purposes, we must continually satisfy tests concerning, among other things, the sources of our income, the nature and diversification of our assets, the amounts we distribute to our stockholders, and the ownership of our stock. We may be required to make distributions to stockholders at disadvantageous times or when we do not have funds readily available for distribution. Thus, compliance with the REIT requirements may hinder our ability to operate solely on the basis of maximizing profits. Complying with REIT requirements may limit our ability to hedge effectively. The REIT provisions of the Code may limit our ability to hedge mortgage securities and related borrowings by requiring us to limit our income and assets in each year from certain hedges, together with any other income not generated from qualified real estate assets, to no more than 25% of our gross income. In addition, we must limit our aggregate income from nonqualified hedging transactions, from our provision of services, and from other non-qualifying sources to no more than 5% of our annual gross income. As a result, we may have to limit our use of advantageous hedging techniques. This could result in greater risks associated with changes in interest rates than we would otherwise want to incur. However, for transactions that we enter into to protect against interest rate risks on debt incurred to acquire qualified REIT assets and for which we identify as hedges for tax purposes, any associated hedging income is excluded from the 95% income test and the 75% income test applicable to a REIT. In addition, similar rules apply to income from positions that primarily manage risk with respect to a prior hedge entered into by a REIT in connection with the extinguishment or disposal (in whole or in part) of the liability or asset related to such prior hedge, to the extent the new position qualifies as a hedge or would so qualify if the hedged position were ordinary property. If we were to violate the 25% or 5% limitations, we may have to pay a penalty tax equal to the amount of income in excess of 35
Page 37
those limitations multiplied by a fraction intended to reflect our profitability. If we fail to satisfy the REIT gross income tests, unless our failure was due to reasonable cause and not due to willful neglect such that a REIT “savings clause” applied, we could lose our REIT status for U.S. federal income tax purposes. Complying with REIT requirements may force us to liquidate otherwise attractive investments. To qualify as a REIT, we must also ensure that at the end of each calendar quarter at least 75% of the value of our assets consists of cash, cash items, government securities, and qualified REIT real estate assets. The remainder of our investment in securities (other than government securities and qualified real estate assets) generally cannot include more than 10% of the outstanding voting securities of any one issuer or more than 10% of the total value of the outstanding securities of any one issuer. In addition, in general, no more than 5% of the value of our assets (other than government securities and qualified real estate assets) can consist of the securities of any one issuer, and no more than 20% of the value of our total assets can be represented by securities of one or more TRSs, and no more than 25% of the value of our total assets can be represented by certain publicly offered REIT debt instruments. If we fail to comply with these requirements at the end of any calendar quarter, we must correct such failure within 30 days after the end of the calendar quarter to avoid losing our REIT status and suffering adverse tax consequences. As a result, we may be required to liquidate otherwise attractive investments. Complying with REIT requirements may force us to borrow to make distributions to our stockholders. As a REIT, we must distribute at least 90% of our annual REIT taxable income, excluding net capital gains, (subject to certain adjustments) to our stockholders. To the extent that we satisfy the distribution requirement, but distribute less than 100% of our taxable income, we will be subject to federal corporate income tax on our undistributed taxable income. In addition, we will be subject to a 4% nondeductible excise tax if the actual amount that we pay out to our stockholders in a calendar year is less than a minimum amount specified under federal tax laws. From time to time, we may generate taxable income greater than our net income for financial reporting purposes or our taxable income may be greater than our cash flow available for distribution to our stockholders. If we do not have other funds available in these situations, we could be required to borrow funds, sell investments at disadvantageous prices, or find another alternative source of funds to make distributions sufficient to enable us to pay out enough of our taxable income to satisfy the distribution requirement and to avoid corporate income tax and the 4% excise tax in a particular year. These alternatives could increase our costs or reduce the value of our equity. To the extent that we make distributions in excess of our current and accumulated earnings and profits (as determined for U.S. federal income tax purposes), such distributions would generally be considered a return of capital for U.S. federal income tax purposes to the extent of the holder’s adjusted tax basis in its shares. A return of capital is not taxable, but it has the effect of reducing the holder’s adjusted tax basis in its investment. To the extent that distributions exceed the adjusted tax basis of a holder’s shares, they will be treated as gain from the sale or exchange of such stock. We may in the future choose to pay taxable dividends in our shares of our common stock instead of cash, in which case stockholders may be required to pay income taxes in excess of the cash dividends they receive. We may distribute taxable dividends that are payable in cash and common stock at the election of each stockholder, subject to certain limitations, including that the cash portion be at least 20% of the total distribution. If we make a taxable dividend payable in cash and common stock, taxable stockholders receiving such dividends will be required to include the full amount of the dividend as ordinary income to the extent of our current and accumulated earnings and profits, as determined for U.S. federal income tax purposes. As a result, stockholders may be required to pay income taxes with respect to such dividends in excess of the cash dividends received. If a U.S. stockholder sells the shares of common stock that it receives as a dividend in order to pay this tax, the sales proceeds may be less than the amount included in income with respect to the dividend, depending on the market price of our common stock at the time of the sale. Furthermore, with respect to certain non-U.S. stockholders, we may be required to withhold U.S. federal income tax with respect to such dividends, including in respect of all or a portion of such dividend that is payable in shares of common stock. In addition, if we made a taxable dividend payable in cash and our common stock and a significant number of our stockholders determine to sell shares of our common stock in order to pay taxes owed on dividends, it may put downward pressure on the trading price of our common stock. We do not currently intend to pay taxable dividends of our common stock and cash, although we may choose to do so in the future. 36
Page 38
The prohibited transactions tax may limit our ability to dispose of our properties. A REIT’s net income from prohibited transactions is subject to a 100% tax. In general, prohibited transactions are sales or other dispositions of property, other than foreclosure property, held primarily for sale to customers in the ordinary course of business. We may be subject to the prohibited transaction tax equal to 100% of net gain upon a disposition of real property. Although a safe harbor to the characterization of the sale of real property by a REIT as a prohibited transaction is available, we cannot assure you that we can comply with the safe harbor or that we will avoid owning property that may be characterized as held primarily for sale to customers in the ordinary course of business. Consequently, we may choose not to engage in certain sales of our properties or may conduct such sales through our TRS, which would be subject to federal and state income taxation. The ability of our board of directors to revoke our REIT qualification without stockholder approval may cause adverse consequences to our stockholders. Our charter provides that our board of directors may revoke or otherwise terminate our REIT election, without the approval of our stockholders, if it determines that it is no longer in our best interest to continue to qualify as a REIT. If we cease to qualify as a REIT, we would become subject to U.S. federal and state and local income taxes on our taxable income and would no longer be required to distribute most of our taxable income to our stockholders, which may have adverse consequences on the total stockholder return received by our stockholders. We may be subject to adverse legislative or regulatory tax changes that could reduce the market price of our securities. At any time, the U.S. federal income tax laws governing REITs or the administrative interpretations of those laws may be amended. We cannot predict when or if any new U.S. federal income tax law, regulation or administrative interpretation, or any amendment to any existing U.S. federal income tax law, regulation or administrative interpretation, will be adopted, promulgated or become effective and any such law, regulation, or interpretation may take effect retroactively. We and our stockholders could be adversely affected by any such change in the U.S. federal income tax laws, regulations or administrative interpretations. It is possible that future legislation would result in a REIT having fewer advantages, and it could become more advantageous for a company that invests in real estate to be treated, for U.S. federal income tax purposes, as a corporation. If Braemar failed to qualify as a REIT for 2013, it would significantly affect our ability to maintain our REIT status. For U.S. federal income tax purposes, we recorded a gain of approximately $145.7 million as a result of the spin-off of Braemar in November 2013. If Braemar qualified for taxation as a REIT for 2013, that gain was qualifying income for purposes of our 2013 REIT income tests. If, however, Braemar failed to qualify as a REIT for 2013, that gain would be non-qualifying income for purposes of the 75% gross income test. Although Braemar covenanted in the Separation and Distribution Agreement to use reasonable best efforts to qualify as a REIT in 2013, no assurance can be given that it so qualified. If Braemar failed to qualify, we would have failed our 2013 REIT income tests, which would either result in our loss of our REIT status for 2013 and the following four taxable years or result in a significant tax in 2013 that has not been accrued or paid and thereby would materially negatively impact our business, financial condition and potentially impair our ability to continue operating in the future. Your investment in our securities has various federal, state, and local income tax risks that could affect the value of your investment. We strongly urge you to consult your own tax advisor concerning the effects of federal, state, and local income tax law on an investment in our securities because of the complex nature of the tax rules applicable to REITs and their stockholders. Our failure to qualify as a REIT would potentially give rise to a claim for damages from Braemar. In connection with the spin-off of Braemar, which was completed in November 2013, we represented in the Separation and Distribution Agreement with Braemar that we have no knowledge of any fact or circumstance that would cause us to fail to qualify as a REIT. In the event of a breach of this representation, Braemar may be able to seek damages from us, which could have a significantly negative effect on our liquidity and results of operations. 37
Page 39
Declines in the values of our investments may make it more difficult for us to maintain our qualification as a REIT or exemption from the Investment Company Act. If the market value or income potential of real estate-related investments declines as a result of changes in interest rates or other factors, we may need to increase our real estate-related investments and income or liquidate our non-qualifying assets in order to maintain our REIT qualification or exemption from the Investment Company Act of 1940 (the “Investment Company Act”). If the decline in real estate asset values and/or income occurs quickly, this may be especially difficult to accomplish. This difficulty may be exacerbated by the illiquid nature of any non-qualifying assets that we may own. We may have to make investment decisions that we otherwise would not make absent the REIT and Investment Company Act considerations. RISKS RELATED TO OUR CORPORATE STRUCTURE Our charter, the partnership agreement of our operating partnership and Maryland law contain provisions that may delay or prevent a change of control transaction. Our charter contains 9.8% ownership limits. For the purpose of preserving our REIT qualification, our charter prohibits direct or constructive ownership by any person of more than (i) 9.8% of the lesser of the total number or value (whichever is more restrictive) of the outstanding shares of our common stock or (ii) 9.8% of the total number or value (whichever is more restrictive) of the outstanding shares of any class or series of our preferred stock or any other stock of our company, unless our board of directors grants a waiver. Our charter’s constructive ownership rules are complex and may cause stock owned actually or constructively by a group of related individuals and/or entities to be deemed to be constructively owned by one individual or entity. As a result, the acquisition of less than 9.8% of any class or series of our stock by an individual or entity could nevertheless cause that individual or entity to own constructively in excess of 9.8% of a class or series of outstanding stock, and thus be subject to our charter’s ownership limit. Any attempt to own or transfer shares of our stock in excess of the ownership limit without the consent of our board of directors will be void and could result in the shares being automatically transferred to a charitable trust. Our board of directors may create and issue a class or series of common stock or preferred stock without stockholder approval. Our charter authorizes our board of directors to issue common stock or preferred stock in one or more classes and to establish the preferences and rights of any class of common stock or preferred stock issued. These actions can be taken without obtaining stockholder approval. Our issuance of additional classes of common stock or preferred stock could substantially dilute the interests of the holders of our common stock. Such issuances could also have the effect of delaying or preventing someone from taking control of us, even if our stockholders’ deemed a change of control to be in their best interests. As discussed above, on December 15, 2025, we created a new series of Series N Preferred Stock. Pursuant to the Rights Agreement, we declared a dividend of one Right for each outstanding share of common stock, with each Right initially representing the right to purchase from the Company one one-thousandth of a share of Series N Preferred Stock at a price of $20.00 per one one-thousandth of a share of Series N Preferred Stock, subject to adjustment. If the Rights become exercisable, our common stock may be diluted, though only the interests of the Acquiring Person would be diluted. Certain provisions in the partnership agreement of our operating partnership may delay or prevent unsolicited acquisitions of us. Provisions in the partnership agreement of our operating partnership may delay or make more difficult unsolicited acquisitions of us or changes in our control. These provisions could discourage third parties from making proposals involving an unsolicited acquisition of us or change of our control, although some stockholders might consider such proposals, if made, desirable. These provisions include, among others: • redemption rights of qualifying parties; • transfer restrictions on our common units; • the ability of the general partner in some cases to amend the partnership agreement without the consent of the limited partners; and • the right of the limited partners to consent to transfers of the general partnership interest and mergers under specified circumstances. 38
Page 40
Because provisions contained in Maryland law and our charter may have an anti-takeover effect, investors may be prevented from receiving a “control premium” for their shares. Provisions contained in our charter and the Maryland General Corporation Law (the “MGCL”) may have effects that delay, defer, or prevent a takeover attempt, which may prevent stockholders from receiving a “control premium” for their shares. For example, these provisions may defer or prevent tender offers for our common stock or purchases of large blocks of our common stock, thereby limiting the opportunities for our stockholders to receive a premium for their common stock over then-prevailing market prices. These provisions include the following: • The ownership limit in our charter limits related investors, including, among other things, any voting group, from acquiring over 9.8% of our common stock or any class of our preferred stock without our permission. • Our charter authorizes our board of directors to issue common stock or preferred stock in one or more classes and to establish the preferences and rights of any class of common stock or preferred stock issued. These actions can be taken without soliciting stockholder approval. Our common stock and preferred stock issuances could have the effect of delaying or preventing someone from taking control of us, even if a change in control were in our stockholders’ best interests. Maryland statutory law provides that an act of a director relating to or affecting an acquisition or a potential acquisition of control of a corporation may not be subject to a higher duty or greater scrutiny than is applied to any other act of a director or determination not to act. Hence, directors of a Maryland corporation by statute are not required to act in certain takeover situations under the same standards of care and are not subject to the same standards of review, as apply in Delaware and other corporate jurisdictions. Certain other provisions of Maryland law, if they became applicable to us, could inhibit changes in control. Certain provisions of the MGCL may have the effect of inhibiting a third party from making a proposal to acquire us under circumstances that otherwise could provide our stockholders with the opportunity to realize a premium over the then-prevailing market price of our common stock or a “control premium” for their shares or inhibit a transaction that might otherwise be viewed as being in the best interest of our stockholders. These provisions include: • “business combination” provisions that, subject to limitations, prohibit certain business combinations between us and an “interested stockholder” (defined generally as any person who beneficially owns 10% or more of the voting power of our shares or an affiliate thereof) for five years after the most recent date on which the stockholder becomes an interested stockholder, and thereafter impose special stockholder voting requirements on these business combinations, unless certain fair price requirements set forth in the MGCL are satisfied; and • “control share” provisions that provide that “control shares” of our company (defined as outstanding shares which, when aggregated with other shares controlled by the stockholder, entitle the stockholder to exercise one of three increasing ranges of voting power in electing directors) acquired in a “control share acquisition” (defined as the direct or indirect acquisition of ownership or control of outstanding “control shares”) have no voting rights except to the extent approved by our stockholders by the affirmative vote of at least two-thirds of all the votes entitled to be cast on the matter, excluding all interested shares. In addition, Subtitle 8 of Title 3 of the MGCL permits a Maryland corporation with a class of equity securities registered under the Exchange Act and at least three independent directors to elect to be subject, notwithstanding any contrary provision in the charter or bylaws, to any or all of the following five provisions: a classified board; a two-thirds stockholder vote requirement for removal of a director; a requirement that the number of directors be fixed only by vote of the directors; a requirement that a vacancy on the board of directors be filled only by the remaining directors and for the remainder of the full term of the class of directors in which the vacancy occurred; and a requirement that the holders of at least a majority of all votes entitled to be cast request a special meeting of stockholders. Our charter opts out of the business combination/moratorium provisions and control share provisions of the MGCL and prevents us from making any elections under Subtitle 8 of the MGCL. Because these provisions are contained in our charter, they cannot be amended unless the board of directors recommends the amendment and the stockholders approve the amendment. Any such amendment would require the affirmative vote of two-thirds of the outstanding voting power of our common stock. 39
Page 41
We depend on our operating partnership and its subsidiaries for cash flow and are effectively structurally subordinated in right of payment to the obligations of our operating partnership and its subsidiaries, which could adversely affect our ability to make distributions to our stockholders. We have no business operations of our own. Our only significant asset is and will be the general and limited partnership interests of our operating partnership. We conduct, and intend to continue to conduct, all of our business operations through our operating partnership. Accordingly, our only source of cash to pay our obligations is distributions from our operating partnership and its subsidiaries of their net earnings and cash flows. We cannot assure our stockholders that our operating partnership or its subsidiaries will be able to, or be permitted to, make distributions to us that will enable us to make distributions to our stockholders from cash flows from operations. Each of our operating partnership’s subsidiaries is a distinct legal entity and, under certain circumstances, legal and contractual restrictions may limit our ability to obtain cash from such entities. Therefore, in the event of our bankruptcy, liquidation or reorganization, our assets and those of our operating partnership and its subsidiaries will be able to satisfy the claims of our stockholders only after all of our and our operating partnership and its subsidiaries liabilities and obligations have been paid in full. Offerings of debt securities, which would be senior to our common stock and any preferred stock upon liquidation, or equity securities, which would dilute our existing stockholders’ holdings and could be senior to our common stock for the purposes of dividend distributions, may adversely affect the market price of our common stock and any preferred stock. We may attempt to increase our capital resources by making additional offerings of debt or equity securities, including commercial paper, medium-term notes, senior or subordinated notes, convertible securities, and classes of preferred stock or common stock or classes of preferred units. Upon liquidation, holders of our debt securities or preferred units and lenders with respect to other borrowings will receive a distribution of our available assets prior to the holders of shares of preferred stock or common stock. Furthermore, holders of our debt securities and preferred stock or preferred units and lenders with respect to other borrowings will receive a distribution of our available assets prior to the holders of our common stock. Additional equity offerings may dilute the holdings of our existing stockholders or reduce the market price of our common or preferred stock or both. Our preferred stock or preferred units could have a preference on liquidating distributions or a preference on dividend payments that could limit our ability to make a dividend distribution to the holders of our common stock. Because our decision to issue securities in any future offering will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing, or nature of our future offerings. Thus, our stockholders bear the risk of our future offerings reducing the market price of our securities and diluting their securities holdings in us. Securities eligible for future sale may have adverse effects on the market price of our securities. We cannot predict the effect, if any, of future sales of securities, or the availability of securities for future sales, on the market price of our outstanding securities. Sales of substantial amounts of common stock, or the perception that these sales could occur, may adversely affect prevailing market prices for our securities. We also may issue from time to time additional shares of our securities or units of our operating partnership in connection with the acquisition of properties and we may grant additional demand or piggyback registration rights in connection with these issuances. Sales of substantial amounts of our securities or the perception that such sales could occur may adversely affect the prevailing market price for our securities or may impair our ability to raise capital through a sale of additional debt or equity securities. An increase in market interest rates may have an adverse effect on the market price of our securities. A factor investors may consider in deciding whether to buy or sell our securities is our dividend rate as a percentage of our share or unit price relative to market interest rates. If market interest rates increase, prospective investors may desire a higher dividend or interest rate on our securities or seek securities paying higher dividends or interest. The market price of our securities is likely based on the earnings and return that we derive from our investments, income with respect to our properties, and our related distributions to stockholders and not necessarily from the market value or underlying appraised value of the properties or investments themselves. As a result, interest rate fluctuations and capital market conditions can affect the market price of our securities. For instance, if interest rates rise without an increase in our dividend rate, the market price of our common or preferred stock could decrease because potential investors may require a higher dividend yield on our common or preferred stock as market rates on interest-bearing securities, such as bonds, rise. In addition, rising interest rates would result in increased interest expense on our variable-rate debt, thereby adversely affecting cash flow and our ability to service our indebtedness and pay dividends. 40
Page 42
Our board of directors can take many actions without stockholder approval. Our board of directors has overall authority to oversee our operations and determine our major corporate policies. This authority includes significant flexibility. For example, our board of directors can do the following: • amend or revise at any time our dividend policy with respect to our common stock or preferred stock (including by eliminating, failing to declare, or significantly reducing dividends on these securities); • terminate our advisor under certain conditions pursuant to the advisory agreement, subject to the payment of a termination fee; • amend or revise at any time and from time to time our investment, financing, borrowing and dividend policies and our policies with respect to all other activities, including growth, debt, capitalization and operations, subject to the limitations and restrictions provided in our advisory agreement and mutual exclusivity agreement; • amend our policies with respect to conflicts of interest provided that such changes are consistent with applicable legal requirements; • subject to the terms of our charter, prevent the ownership, transfer and/or accumulation of shares in order to protect our status as a REIT or for any other reason deemed to be in the best interests of us and our stockholders; • issue additional shares without obtaining stockholder approval, which could dilute the ownership of our then-current stockholders; • subject to the terms of any outstanding classes or series of preferred stock, classify or reclassify any unissued shares of our common stock or preferred stock and set the preferences, rights and other terms of such classified or reclassified shares, without obtaining stockholder approval; • employ and compensate affiliates (subject to disinterested director approval); • direct our resources toward investments that do not ultimately appreciate over time; and • determine that it is not in our best interests to attempt to qualify, or to continue to qualify, as a REIT. Any of these actions could increase our operating expenses, impact our ability to make distributions or reduce the value of our assets without giving stockholders the right to vote. The ability of our board of directors to change our major policies without the consent of stockholders may not be in our stockholders’ interest. Our board of directors determines our major policies, including policies and guidelines relating to our acquisitions, leverage, financing, growth, operations and distributions to stockholders. Our board of directors may amend or revise these and other policies and guidelines from time to time without the vote or consent of our stockholders, subject to certain limitations and restrictions provided in our advisory agreement. Accordingly, our stockholders will have limited control over changes in our policies and those changes could adversely affect our financial condition, results of operations, the market price of our stock and our ability to make distributions to our stockholders. Our rights and the rights of our stockholders to take action against our directors and officers are limited. Maryland law provides that a director or officer has no liability in that capacity if he or she performs his or her duties in good faith, in a manner he or she reasonably believes to be in our best interests and with the care that an ordinarily prudent person in a like position would use under similar circumstances. In addition, our charter eliminates our directors’ and officers’ liability to us and our stockholders for money damages except for liability resulting from actual receipt of an improper benefit or profit in money, property or services or active and deliberate dishonesty established by a final judgment to have been material to the cause of action. Our charter requires us to indemnify our directors and officers and to advance expenses prior to the final disposition of a proceeding to the maximum extent permitted by Maryland law for liability actually incurred in connection with any proceeding to which they may be made, or threatened to be made, a party, except to the extent that the act or omission of the director or officer was material to the matter giving rise to the proceeding and was either committed in bad faith or was the result of active and deliberate dishonesty, the director or officer actually received an improper personal benefit in money, property or services, or, in the case of any criminal proceeding, the director or officer had reasonable cause to believe that the act or omission was unlawful. As a result, we and our stockholders may have more limited rights against our directors and officers than might otherwise exist under common law. In addition, we are generally obligated to fund the defense costs incurred by our directors and officers. 41
Page 43
Future issuances of securities, including our common stock and preferred stock, could reduce existing investors’ relative voting power and percentage of ownership and may dilute our share value. Our charter authorizes the issuance of up to 395,000,000 shares of common stock and 55,000,000 shares of preferred stock. As of March 18, 2026, we had 6,476,491 shares of our common stock issued and outstanding, 1,111,127 shares of our Series D Cumulative Preferred Stock, 1,037,044 shares of our Series F Cumulative Preferred Stock, 1,470,948 shares of our Series G Cumulative Preferred Stock, 1,037,956 shares of our Series H Cumulative Preferred Stock, and 1,034,303 shares of our Series I Cumulative Preferred Stock, 7,684,201 shares of our Series J Redeemable Preferred Stock, 731,102 shares of our Series K Redeemable Preferred Stock, 238,191 shares of our Series L Redeemable Preferred Stock and 550,888 shares of our Series M Redeemable Preferred Stock. Additionally, on December 15, 2025, we declared a dividend of one Right for each outstanding share of common stock, each Right initially representing the right to purchase one one-thousandth of a share of Series N Preferred Stock, and we designated 300,000 shares of Series N Preferred Stock for issuance pursuant to the Rights Agreement. Accordingly, we may issue up to an additional 388,523,509 shares of common stock and 40,104,240 shares of preferred stock. Future issuances of common stock or preferred stock could decrease the relative voting power of our common stock or preferred stock and may cause substantial dilution in the ownership percentage of our then-existing holders of common or preferred stock. Further, if the Rights become exercisable, our common stock may be diluted, though only the interests of the Acquiring Person would be diluted. Future issuances may have the effect of reducing investors’ relative voting power and/or diluting the net tangible book value of the shares held by our stockholders, and might have an adverse effect on any trading market for our securities. Our board of directors may designate the rights, terms and preferences of our authorized but unissued common shares or preferred shares at its discretion, including conversion and voting preferences without stockholder approval. We are not currently eligible to use our effective short form registration statement on Form S-3 or to file a new Form S-3, which may impair our capital raising activities. As a result of our failure to pay dividends to the holders of our Preferred Stock on January 15, 2026, we are not eligible to use our existing short form registration statement on Form S-3 or to file a new Form S-3, which may impair our capital raising activities. Form S-3 permits eligible issuers to conduct registered offerings using a short form registration statement that allows the issuer to incorporate by reference its past and future filings and reports made under the Exchange Act. In addition, Form S-3 enables eligible issuers to conduct primary offerings “off the shelf” under Rule 415 of the Securities Act of 1933, as amended (the “Securities Act”). The shelf registration process, combined with the ability to forward incorporate information, allows issuers to avoid delays and interruptions in the offering process and to access the capital markets in a more expeditious and efficient manner than raising capital in a standard registered offering pursuant to a long-form registration statement on Form S-11. We have relied on shelf registration statements on Form S-3 for our financings in recent years, and accordingly any such limitations may harm our ability to raise the capital we need. Under these circumstances, if we remain ineligible to use Form S-3, we will be required to use a registration statement on Form S-11 to register securities with the SEC, which would hinder our ability to act as quickly in raising capital to take advantage of market conditions in our capital raising activities and would increase our cost of raising capital. The Rights Agreement adopted in December 2025 to protect our Tax Benefits may delay or prevent unsolicited acquisitions of us, or may adversely affect the market for our common stock. We have entered into a Rights Agreement designed to prevent the Company from facing a substantial limitation on its ability to use its Tax Benefits (as such term is defined in the Rights Agreement) to offset potential future income taxes for federal income tax purposes and realize other efficiencies. On December 15, 2025, the Board declared a dividend of one Right for each outstanding share of common stock, each Right initially representing the right to purchase from the Company one one-thousandth of a share of Series N Preferred Stock at a price of $20.00 per one one-thousandth of a share of Series N Preferred Stock, subject to adjustment. Prior to exercise, a Right does not give its holder any rights as a stockholder of the Company, including without limitation, any dividend, voting or liquidation rights. Subject to certain exceptions specified in the Rights Agreement, the Rights will separate from the common stock and become exercisable at 5:00 p.m. New York City time on the next business day following the Distribution Date. Although our Rights Agreement is intended to prevent the Company from facing a substantial limitation on its ability to use its Tax Benefits, we cannot provide any assurance that we will not experience such a limitation or that we will otherwise be able to use, in full or in part, our Tax Benefits. Additionally, the Rights Agreement may make our common stock less attractive to investors, discourage potential acquirers from attempting to take over our company, limit the price that investors might be willing to pay for shares of our common stock and otherwise hinder the market for our common stock. Item 1B. Unresolved Staff Comments None. 42
Page 44
Item 1C. Cybersecurity Risk Management and Strategy. The Company relies on Ashford Inc. and the Company’s managers to protect the electronic assets of the Company. Their programs consist of various processes designed to ensure that the Company and its electronic assets are shielded from cyber events that may compromise the Company’s ability to successfully execute its business on a day-to-day basis. These processes cover areas such as, but not limited to, risk management, access control, anti-virus management, electronic communication, risk/security reporting, incident response planning and business continuity planning. The information technology department of Remington Hospitality (“IT Department”), which includes a cybersecurity department (“IT Security Department”), is responsible for implementing processes and coordinating with the Human Resources Department to align training and onboarding efforts of Ashford Inc. and Remington Hospitality employees handling the Company’s electronic assets. Remington Hospitality’s IT Security Department carries out risk management primarily by outsourcing risks to those companies and agencies that specialize in handling such risks and that have the appropriate resources to do so. Additionally, Remington Hospitality’s IT Department assesses and improves the Company’s cybersecurity risk management processes on an annual basis by: (i) engaging consultants to complete a benchmarking evaluation to compare its cybersecurity posture against peers; and (ii) engaging a cybersecurity risk readiness and response company to conduct vulnerability and penetration testing, which produces a report that specifies any possible risk area and devices. Such report is presented to the IT Department for analysis and for the purpose of developing subsequent action plans to remediate any vulnerabilities. As of the date of this report, we are not aware of any material risks from cybersecurity threats that have materially affected or are reasonably likely to materially affect the Company, including our business strategy, results of operations, or financial conditions, except as otherwise noted. Governance. Management, provided by Ashford Inc., is ultimately responsible for assessing and managing the Company’s cybersecurity risk. The information security program is overseen by the Executive Vice President of Asset Management for Ashford Inc. and the Executive Vice President of Technology for Remington Hospitality. A Cyber Incident Response Team comprised of Ashford Inc. and Remington Hospitality employees meets monthly to review incidents that have occurred and/or impacted the Company’s electronic assets. The Executive Vice President of Technology of Remington Hospitality reviews weekly reports that contain an overview of the activity in the department, any United States Computer Emergency Readiness Team alerts processed and all findings from the preventative maintenance tools. The Executive Vice President of Technology provides such report to the Executive Vice President of Asset Management on a quarterly basis. The Audit Committee of the board of directors is then briefed each quarter on the occurrence of any cybersecurity incidents. 43
Page 45
Item 2. Properties OFFICES. We lease our headquarters located at 14185 Dallas Parkway, Suite 1200, Dallas, Texas 75254. HOTEL PROPERTIES. As of December 31, 2025, our portfolio consisted of 67 operating hotel properties and one consolidated operating hotel property through a 29.3% owned investment in a consolidated entity. Currently, all of our hotel properties are located in the United States. The following table presents certain information related to our hotel properties: Year Ended December 31, 2025 Hotel Property Location Service Type Total Rooms % Owned OwnedRooms Occupancy ADR RevPAR Fee Simple Properties Embassy Suites Austin, TX Full-service 150 100 % 150 72.00 % $ 142.01 $ 102.29 Embassy Suites Dallas, TX Full-service 150 100 % 150 72.00 % $ 141.86 $ 102.15 Embassy Suites Herndon, VA Full-service 150 100 % 150 72.60 % $ 169.49 $ 123.03 Embassy Suites Las Vegas, NV Full-service 220 100 % 220 82.20 % $ 167.75 $ 137.92 Embassy Suites Houston, TX Full-service 150 100 % 150 65.10 % $ 138.82 $ 90.37 Embassy Suites West Palm Beach, FL Full-service 160 100 % 160 76.90 % $ 192.23 $ 147.77 Embassy Suites Philadelphia, PA Full-service 263 100 % 263 78.40 % $ 155.49 $ 121.96 Embassy Suites Arlington, VA Full-service 269 100 % 269 72.90 % $ 227.00 $ 165.49 Embassy Suites Portland, OR Full-service 276 100 % 276 57.60 % $ 151.96 $ 87.51 Embassy Suites Santa Clara, CA Full-service 258 100 % 258 66.20 % $ 251.51 $ 166.58 Embassy Suites Orlando, FL Full-service 174 100 % 174 85.50 % $ 163.31 $ 139.63 Hilton Garden Inn Jacksonville, FL Select-service 119 100 % 119 60.30 % $ 131.65 $ 79.40 Hilton Garden Inn Austin, TX Select-service 254 100 % 254 52.80 % $ 175.88 $ 92.82 Hilton Garden Inn Baltimore, MD Select-service 158 100 % 158 79.20 % $ 123.36 $ 97.71 Hilton Garden Inn Virginia Beach, VA Select-service 176 100 % 176 62.40 % $ 160.30 $ 100.07 Hilton St. Petersburg, FL Full-service 333 100 % 333 73.60 % $ 180.86 $ 133.13 Hilton Santa Fe, NM Full-service 158 100 % 158 82.40 % $ 214.23 $ 176.55 Hilton Bloomington, MN Full-service 300 100 % 300 63.50 % $ 121.91 $ 77.36 Hilton Costa Mesa, CA Full-service 486 100 % 486 79.40 % $ 156.70 $ 124.46 Hilton Parsippany, NJ Full-service 353 100 % 353 46.10 % $ 166.21 $ 76.60 Hilton Tampa, FL Full-service 238 100 % 238 87.90 % $ 169.67 $ 149.16 Hilton Alexandria, VA Full-service 252 100 % 252 64.60 % $ 207.82 $ 134.35 Hilton Santa Cruz, CA Full-service 178 100 % 178 74.40 % $ 169.50 $ 126.18 Hilton Ft. Worth, TX Full-service 294 100 % 294 66.20 % $ 177.36 $ 117.41 Hampton Inn Buford, GA Select-service 92 100 % 92 75.69 % $ 135.48 $ 102.55 Hampton Inn Evansville, IN Select-service 140 100 % 140 63.60 % $ 121.37 $ 77.22 Hampton Inn Parsippany, NJ Select-service 152 100 % 152 68.40 % $ 134.16 $ 91.79 Marriott Beverly Hills, CA Full-service 260 100 % 260 88.60 % $ 259.97 $ 230.29 Marriott Arlington, VA Full-service 703 100 % 703 75.70 % $ 226.06 $ 171.17 Marriott Dallas, TX Full-service 265 100 % 265 62.70 % $ 164.32 $ 102.97 Marriott Fremont, CA Full-service 357 100 % 357 70.00 % $ 167.69 $ 117.34 Marriott Memphis, TN Full-service 232 100 % 232 72.10 % $ 155.96 $ 112.43 Marriott Irving, TX Full-service 499 100 % 499 73.20 % $ 178.45 $ 130.57 Marriott Omaha, NE Full-service 300 100 % 300 57.80 % $ 136.51 $ 78.88 Marriott Sugarland, TX Full-service 303 100 % 303 79.90 % $ 169.47 $ 135.37 SpringHill Suites by Marriott Buford, GA Select-service 97 100 % 97 79.20 % $ 132.73 $ 105.12 Courtyard by Marriott Bloomington, IN Select-service 117 100 % 117 54.10 % $ 166.87 $ 90.23 Courtyard by Marriott Denver, CO Select-service 202 100 % 202 84.40 % $ 151.21 $ 127.55 Courtyard by Marriott Gaithersburg, MD Select-service 210 100 % 210 63.70 % $ 169.44 $ 107.97 Courtyard by Marriott Crystal City, VA Select-service 272 100 % 272 76.20 % $ 171.03 $ 130.29 Courtyard by Marriott Overland Park, KS Select-service 168 100 % 168 65.20 % $ 128.88 $ 84.01 Courtyard by Marriott Foothill Ranch, CA Select-service 156 100 % 156 75.60 % $ 145.88 $ 110.36 Courtyard by Marriott Alpharetta, GA Select-service 154 100 % 154 59.50 % $ 117.88 $ 70.18 Marriott Residence Inn Orlando, FL Select-service 350 100 % 350 70.10 % $ 145.62 $ 102.06 Marriott Residence Inn Falls Church, VA Select-service 159 100 % 159 74.00 % $ 159.86 $ 118.30 Marriott Residence Inn Jacksonville, FL Select-service 120 100 % 120 74.61 % $ 135.44 $ 101.06 Marriott Residence Inn Manchester, CT Select-service 96 100 % 96 82.60 % $ 164.95 $ 136.25 44
Page 46
Year Ended December 31, 2025 Hotel Property Location Service Type Total Rooms % Owned OwnedRooms Occupancy ADR RevPAR Sheraton Hotel Minneapolis, MN Full-service 220 100 % 220 48.70 % $ 137.63 $ 67.09 Sheraton Hotel Indianapolis, IN Full-service 378 100 % 378 56.80 % $ 176.64 $ 100.30 Sheraton Hotel Anchorage, AK Full-service 370 100 % 370 73.10 % $ 231.84 $ 169.40 Sheraton Hotel San Diego, CA Full-service 260 100 % 260 88.30 % $ 156.37 $ 138.00 Hyatt Regency Coral Gables, FL Full-service 254 100 % 254 78.50 % $ 244.37 $ 191.76 Hyatt Regency Hauppauge, NY Full-service 358 100 % 358 64.30 % $ 170.39 $ 109.56 Hyatt Regency Savannah, GA Full-service 351 100 % 351 88.10 % $ 210.68 $ 185.56 Renaissance Nashville, TN Full-service 674 100 % 674 78.30 % $ 286.35 $ 224.10 Annapolis Historic Inn Annapolis, MD Full-service 124 100 % 124 59.40 % $ 191.70 $ 113.78 Lakeway Resort & Spa Austin, TX Full-service 168 100 % 168 49.10 % $ 211.43 $ 103.89 Silversmith Chicago, IL Full-service 144 100 % 144 67.20 % $ 185.09 $ 124.36 The Churchill Washington, DC Full-service 173 100 % 173 60.60 % $ 190.59 $ 115.45 The Melrose Washington, DC Full-service 240 100 % 240 66.70 % $ 193.01 $ 128.71 Westin Princeton, NJ Full-service 296 100 % 296 66.50 % $ 178.32 $ 118.49 Hotel Indigo Atlanta, GA Full-service 141 100 % 141 65.10 % $ 141.04 $ 91.84 Ritz-Carlton Atlanta, GA Full-service 444 100 % 444 64.00 % $ 308.42 $ 197.44 La Posada de Santa Fe Santa Fe, NM Full-service 157 100 % 157 75.40 % $ 278.44 $ 209.94 Leasehold Properties Autograph La Concha Key West, FL Full-service 160 100 % 160 74.90 % $ 376.00 $ 281.75 Renaissance Palm Springs, CA Full-service 410 100 % 410 68.60 % $ 204.17 $ 140.05 Hilton Marietta, GA Full-service 200 100 % 200 64.90 % $ 176.81 $ 114.73 Le Méridien Fort Worth, TX Full-service 188 29 % 55 67.20 % $ 192.97 $ 129.67 Total 16,633 16,500 70.39 % $ 187.93 $ 132.28 ________ The ground lease expires in 2084. The ground lease expires in 2059. The lease expires in 2054 and includes the lease of the land, hotel and conference center (including the building, improvements, furniture, fixtures and equipment). The lease expires in 2120 and includes the lease of the land and building. (1) (2) (3) (4) (1) (2) (3) (4) 45
Page 47
Item 3. Legal Proceedings On December 20, 2016, a class action lawsuit was filed against one of the Company’s hotel management companies in the Superior Court of the State of California in and for the County of Contra Costa alleging violations of certain California employment laws, which class action affects nine hotels owned by subsidiaries of the Company. The court has entered an order granting class certification with respect to: (i) a statewide class of non-exempt employees of our manager who were allegedly deprived of rest breaks as a result of our manager’s previous written policy requiring its employees to stay on premises during rest breaks; and (ii) a derivative class of non-exempt former employees of our manager who were not paid for allegedly missed breaks upon separation from employment. Notices to potential class members were sent out on February 2, 2021. Potential class members had until April 4, 2021, to opt out of the class; however, the total number of employees in the class has not been definitively determined and is the subject of continuing discovery. The opt-out period has been extended until such time that discovery has concluded. In May 2023, the trial court requested additional briefing from the parties to determine whether the case should be maintained, dismissed or the class de-certified. After submission of the briefs, the court requested that the parties submit stipulations for the court to rule upon. On February 13, 2024, the judge ordered the parties to submit additional briefing related to on-site breaks. A tentative settlement in the amount of $850,000 was reached on February 14, 2025. Final court approval was obtained on September 12, 2025. Ashford Trust’s portion of the settlement is 88.2%. The case is now in the settlement administration phase. As of December 31, 2025, the settlement liability amount was accrued. On August 4, 2020, a lawsuit, Benjamin Zermeno v. Beverly Hills Marriott, was filed in Alameda County Superior Court as a PAGA representative action alleging various wage and hour violations of all Remington managed California properties. The plaintiff’s individual claims were compelled to arbitration. On August 18, 2022, another lawsuit, Cristina Catalano v. Beverly Hills Marriott and Mr. C, was filed as a PAGA representative action alleging various wage and hour violations of all Remington managed California properties. The co- defendant separately settled and the individual arbitration has also settled. A private mediation was held on December 27, 2024 to globally resolve the three outstanding matters. The court approved the settlement of all matters on January 16, 2026. The aggregate settlement is $2.5 million and Ashford Trust’s portion of the settlement is $1.8 million. As of December 31, 2025, the settlement liability amount was accrued. On April 18, 2024, the California Department of Industrial Relations (“DIR”) served the Company’s manager with an investigative subpoena relative to concerns with the Palm Springs Renaissance Hotel’s COVID recall efforts. On August 27, 2025, the DIR issued a citation that the Company’s manager failed to properly recall certain employees. On September 17, 2025, the Company’s manager filed an appeal which is currently pending. The matter is in the early stages and the ultimate outcome of this matter is unknown at this time. We do not believe that any potential loss to the Company is reasonably estimable at this time. As of December 31, 2025, no amounts were accrued. We are also engaged in other legal proceedings that have arisen but have not been fully adjudicated. To the extent the claims giving rise to these legal proceedings are not covered by insurance, they relate to the following general types of claims: employment matters, tax matters and matters relating to compliance with applicable law (for example, the Americans with Disabilities Act and similar state laws). The likelihood of loss from these legal proceedings is based on the definitions within contingency accounting literature. We recognize a loss when we believe the loss is both probable and reasonably estimable. Based on the information available to us relating to these legal proceedings and/or our experience in similar legal proceedings, we do not believe the ultimate resolution of these proceedings, either individually or in the aggregate, will have a material adverse effect on our consolidated financial position, results of operations or cash flow. Our assessment may change depending upon the development of any current or future legal proceedings, and the final results of such legal proceedings cannot be predicted with certainty. If we ultimately do not prevail in one or more of these legal matters, and the associated realized losses exceed our current estimates of the range of potential losses, our consolidated financial position, results of operations or cash flows could be materially adversely affected in future periods. Item 4. Mine Safety Disclosures None. PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities (a) Market Price of and Dividends on Registrant’s Common Equity and Related Stockholder Matters Market Price and Dividend Information Our common stock is listed and traded on the New York Stock Exchange under the symbol “AHT.” On March 18, 2026, there were 263 registered holders of record of our common stock. 46
Page 48
For the year ended December 31, 2025 we did not declare or pay cash dividends on our common stock. As discussed in more detail above, on December 15, 2025, we declared a dividend of one Right for each outstanding share of common stock, each Right initially representing the right to purchase from the Company one one-thousandth of a share of Series N Preferred Stock at a price of $20.00 per one one-thousandth of a share of Series N Preferred Stock, subject to adjustment as provided in the Rights Agreement. The dividend was paid to holders of Common Stock of record as of 5:00 p.m. New York City time on December 26, 2025. On December 15, 2025, the board of directors approved our dividend policy for 2026, which continued the suspension of the Company’s common stock dividend into 2026. Further, to preserve the Company’s liquidity position as it evaluates strategic alternatives, preferred dividends have been suspended, including dividends previously declared for recordholders of the Company’s Series D, F, G, H, I, J, K, L and M preferred stock as of December 31, 2025, and payable on January 15, 2026. We intend to pay the previously declared but unpaid dividends as soon as reasonably practicable. Any accrued but unpaid dividends will accrue in accordance with the terms outlined in the applicable governing documents for each series of preferred stock. We will continue to evaluate potential future dividends on a quarterly basis. The board of directors will continue to review our dividend policy and make future announcements with respect thereto. We may incur indebtedness to meet distribution requirements imposed on REITs under the Code to the extent that working capital and cash flow from our investments are insufficient to fund required distributions. To maintain our qualification as a REIT, we intend to make annual distributions to our stockholders of at least 90% of our REIT taxable income, excluding net capital gains (which does not necessarily equal net income as calculated in accordance with GAAP). Distributions will be authorized by our board of directors and declared by us based upon a variety of factors deemed relevant by our directors. Our ability to pay distributions to our stockholders will depend, in part, upon our receipt of distributions from our operating partnership. This, in turn, may depend upon receipt of lease payments with respect to our properties from indirect, wholly owned subsidiaries of our operating partnership and the management of our properties by our hotel managers and general business conditions. Characterization of Distributions For income tax purposes, distributions paid consist of ordinary income, capital gains, return of capital or a combination thereof. Distributions paid per share were characterized as follows for the following fiscal years: 2025 2024 2023 Amount Amount Amount Preferred Stock – Series D: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.9383 — Return of capital 2.1124 1.1741 2.1125 Total $ 2.1124 $ 2.1124 $ 2.1125 Preferred Stock – Series F: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.8189 — Return of capital 1.8436 1.0247 1.8438 Total $ 1.8436 $ 1.8436 $ 1.8438 Preferred Stock – Series G: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.8189 — Return of capital 1.8436 1.0247 1.8438 Total $ 1.8436 $ 1.8436 $ 1.8438 Preferred Stock – Series H: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.8329 — Return of capital 1.8750 1.0421 1.8750 Total $ 1.8750 $ 1.8750 $ 1.8750 Preferred Stock – Series I: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.8329 — Return of capital 1.8750 1.0421 1.8750 Total $ 1.8750 $ 1.8750 $ 1.8750 Preferred Stock – Series J: Ordinary taxable dividend $ — $ — $ — (1) (1) (1) (1) (1) (1) (1) (1) (1) (1) (1) (1) (1) (1) (1) (2) 47
Page 49
2025 2024 2023 Amount Amount Amount Capital gain distribution — 0.8884 — Return of capital 2.0000 1.1116 1.9998 Total $ 2.0000 $ 2.0000 $ 1.9998 Preferred Stock – Series J: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — — — Return of capital 1.8334 — — Total $ 1.8334 $ — $ — Preferred Stock – Series K: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.9236 — Return of capital 2.1042 1.1556 2.054 Total $ 2.1042 $ 2.0792 $ 2.0540 Preferred Stock – Series K: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.9208 — Return of capital 2.0979 1.1521 1.879 Total $ 2.0979 $ 2.0729 $ 1.8790 Preferred Stock – Series K: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.9180 — Return of capital 2.0917 1.1487 1.879 Total $ 2.0917 $ 2.0667 $ 1.8790 Preferred Stock – Series K: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.9152 — Return of capital 2.0854 1.1452 1.8790 Total $ 2.0854 $ 2.0604 $ 1.8790 Preferred Stock – Series K: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.9125 — Return of capital 2.0792 1.1417 1.879 Total $ 2.0792 $ 2.0542 $ 1.8790 Preferred Stock – Series K: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.8347 — Return of capital 2.0730 1.0444 — Total $ 2.0730 $ 1.8791 $ — Preferred Stock – Series K: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.6071 — Return of capital 2.0667 0.7596 — Total $ 2.0667 $ 1.3667 $ — Preferred Stock – Series K: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.3794 — Return of capital 2.0604 0.4747 — Total $ 2.0604 $ 0.8541 $ — Preferred Stock – Series K: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — 0.1518 — Return of capital 2.0541 0.1899 — Total $ 2.0541 $ 0.3417 $ — Preferred Stock – Series K: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — — — (1) (20) (1) (22) (1) (21) (3) (1) (20) (4) (1) (20) (1) (22) (1) (21) (5) (1) (20) (1) (22) (1) (21) (6) (1) (20) (1) (22) (1) (21) (7) (1) (20) (1) (22) (1) (21) (8) (1) (20) (1) (22) (1) (21) (9) (1) (20) (1) (22) (10) (1) (20) (1) (22) (11) (1) (20) (1) (22) (12) (1) (20) (1) (22) (13)
Page 50
48
Page 51
2025 2024 2023 Amount Amount Amount Return of capital 1.8791 — — Total $ 1.8791 $ — $ — Preferred Stock – Series L: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — — — Return of capital 1.2500 — — Total $ 1.2500 $ — $ — Preferred Stock – Series L: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — — — Return of capital 0.7813 — — Total $ 0.7813 $ — $ — Preferred Stock – Series L: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — — — Return of capital 0.3125 — — Total $ 0.3125 $ — $ — Preferred Stock – Series M: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — — — Return of capital 1.2834 — — Total $ 1.2834 $ — $ — Preferred Stock – Series M: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — — — Return of capital 0.8021 — — Total $ 0.8021 $ — $ — Preferred Stock – Series M: Ordinary taxable dividend $ — $ — $ — Capital gain distribution — — — Return of capital 0.3208 — — Total $ 0.3208 $ — $ — ____________________ The fourth quarter 2023 preferred distributions paid January 16, 2024 to stockholders of record as of December 29, 2023 are treated as 2024 distributions for tax purposes. The fourth quarter 2024 preferred distributions paid January 15, 2025 to stockholders of record as of December 31, 2024 are treated as 2025 distributions for tax purposes. The fourth quarter 2025 preferred distributions payable on January 15, 2026 to stockholders of record as of December 31, 2025 were suspended. See discussion in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. Preferred Stock - Series J: (CUSIP #04410A863, 04410A798, 04410A723, 04410A657, 04410A574, 04410A517, 04410A434, 04410A368, 04410A285) Preferred Stock - Series J: (CUSIP #04410A228) Preferred Stock - Series K: (CUSIP #04410D867) Preferred Stock - Series K: (CUSIP #04410D792) Preferred Stock - Series K: (CUSIP #04410D727) Preferred Stock - Series K: (CUSIP #04410D651) Preferred Stock - Series K: (CUSIP #04410D578) Preferred Stock - Series K: (CUSIP #04410D511) Preferred Stock - Series K: (CUSIP #04410D438) Preferred Stock - Series K: (CUSIP #04410D362) Preferred Stock - Series K: (CUSIP #04410D289) Preferred Stock - Series K: (CUSIP #04410D222) Preferred Stock - Series L: (CUSIP #04410E204) Preferred Stock - Series L: (CUSIP #04410E303) Preferred Stock - Series L: (CUSIP #04410E402) Preferred Stock - Series M: (CUSIP #04410E832) Preferred Stock - Series M: (CUSIP #04410E824) Preferred Stock - Series M: (CUSIP #04410E816) (1) (20) (14) (1) (20) (15) (1) (20) (16) (1) (20) (17) (1) (20) (18) (1) (20) (19) (1) (20) (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) (16) (17) (18) (19) 49
Page 52
Distributions per share reflects the annual rate per share for distributions reportable in 2025. Distributions per share reflects the annual rate per share for distributions reportable in 2024. Distributions per share reflects the annual rate per share for distributions reportable in 2023. Equity Compensation Plan Information The following table sets forth certain information with respect to securities authorized and available for issuance under our equity compensation plans as of December 31, 2025: Number of Securities to beIssued Upon Exercise ofOutstanding Options,Warrants and Rights Weighted-AverageExercise Price OfOutstandingOptions, Warrants,And Rights Number of SecuritiesRemaining Availablefor Future Issuance Equity compensation plans approved by security holders — N/A 190,000 Equity compensation plans not approved by security holdersNone N/A None Total — N/A 190,000 ____________________ Consists of rights to acquire our common stock subject to the satisfaction of service and or performance vesting conditions. As of December 31, 2025, there were approximately 190,000 shares of our common stock, or securities convertible into approximately 190,000 shares of our common stock that remained available for issuance under our 2021 Stock Incentive Plan. (20) (21) (22) (1) (2) (1) (2) 50
Page 53
Performance Graph The following graph compares the percentage change in the cumulative total stockholder return on our common stock with the cumulative total return of the S&P 500 Stock Index and the FTSE NAREIT Lodging & Resorts Index for the period from December 31, 2020 through December 31, 2025, assuming an initial investment of $100 in stock on December 31, 2020 with reinvestment of dividends. The NAREIT Lodging Resorts Index is not a published index; however, we believe the companies included in this index provide a representative example of enterprises in the lodging resort line of business in which we engage. Stockholders who wish to request a list of companies in the FTSE NAREIT Lodging & Resorts Index may send written requests to Ashford Hospitality Trust, Inc., Attention: Stockholder Relations, 14185 Dallas Parkway, Suite 1200, Dallas, Texas 75254. The stock price performance shown below on the graph is not necessarily indicative of future price performance. COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN Among Ashford Hospitality Trust, Inc., the S&P Index and the FTSE NAREIT Lodging & Resorts Index 51
Page 54
Purchases of Equity Securities by the Issuer The following table provides the information with respect to purchases and forfeitures of shares of our common stock during each of the months in the fourth quarter of 2025: Period Total Number ofShares Purchased AveragePrice Paid PerShare Total Number ofShares Purchased asPart of PubliclyAnnounced Plan Maximum DollarValue of Shares ThatMay Yet Be PurchasedUnder the Plan Common stock: October 1 – October 31 — $ — — $ 200,000,000 November 1 – November 30 — — — 200,000,000 December 1 – December 31 — — — 200,000,000 Total — $ — — ____________________ On April 6, 2022, the board of directors approved a stock repurchase program pursuant to which the board of directors granted a repurchase authorization to acquire shares of the Company’s common stock and preferred stock having an aggregate value of up to $200 million. The board of directors’ authorization replaced the previous repurchase authorization that the board of directors authorized in December 2017. Item 6. Reserved Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations This section of this Form 10-K generally discusses 2025 and 2024 items and year-to-year comparisons between 2025 and 2024. Discussions of 2024 items and year-to-year comparisons between 2024 and 2023 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. EXECUTIVE OVERVIEW General As of December 31, 2025, our portfolio consisted of 67 consolidated operating hotel properties, which represent 16,445 total rooms, and one additional consolidated operating hotel property owned through a 29.3% investment in a consolidated entity, which represents 188 total rooms. Currently, all of our hotel properties are located in the United States. Based on our primary business objectives and forecasted operating conditions, our current key priorities and financial strategies include, among other things: • preserving capital and maintaining significant cash and cash equivalents liquidity; • disposition of non-core hotel properties; • acquisition of hotel properties, in whole or in part, that we expect will be accretive to our portfolio; • pursuing capital market activities and implementing strategies to enhance long-term stockholder value; • accessing cost effective capital, including through the issuance of non-traded preferred securities; • opportunistically exchanging preferred stock into common stock; • implementing selective capital improvements designed to increase profitability and maintain the quality of our assets; • implementing effective asset management strategies to minimize operating costs and increase revenues; • financing or refinancing hotels on competitive terms; • modifying or extending property-level indebtedness; • utilizing hedges, derivatives and other strategies to mitigate risks; • pursuing opportunistic value-add additions to our hotel portfolio; and • making other investments or divestitures that our board of directors deems appropriate. Our current investment strategy is to focus on owning predominantly full-service hotels in the upper upscale segment in domestic markets that have RevPAR generally less than twice the national average. We believe that as supply, demand and capital market cycles change, we will be able to shift our investment strategy to take advantage of new lodging-related investment opportunities as they may develop. Our board of directors may change our investment strategy at any time without stockholder approval or notice. We will continue to seek ways to benefit from the cyclical nature of the hotel industry. (1) (1) (1) 52
Page 55
Recent Developments On October 15, 2025, the Company completed the sale of the 150-room Residence Inn San Diego Sorrento Mesa located in San Diego, California, for $42.0 million, subject to customary pro rations and adjustments. On November 10, 2025, Ashford Trust OP executed an Amended and Restated Master Line of Credit Promissory Note (the “Amended and Restated Promissory Note”) with Ashford Hospitality Advisors LLC (“Ashford LLC”), a subsidiary of Ashford Inc., amending the original Master Line of Credit Promissory note, dated August 14, 2025, allowing Ashford Trust OP to draw up to $40 million in cash through November 15, 2026 to fund Permitted Costs (as defined in the Promissory Note). Funds advanced under the Amended and Restated Promissory Note bear interest at an annual rate of 10.0% which may be paid in cash or paid in-kind at Ashford OP’s discretion. The maturity date of the Amended and Restated Promissory Note is November 15, 2026, at which time all principal drawn upon and outstanding interest are due and payable. As collateral to secure the repayment of any amounts advanced by Ashford LLC under the Amended and Restated Promissory Note, the Company pledged to Ashford LLC the Company’s equity in Ashford Trust OP subject to Ashford LLC’s filing of a financing statement in the appropriate jurisdiction. On November 10, 2025, the Company and Ashford LLC entered into Amendment No. 6 to the Advisory Agreement (the “Sixth Amendment”). The Sixth Amendment further extends the outside date for which any sale or disposition of any of the Company’s Highland Portfolio and JPM8 hotel properties securing the associated mortgage loans following an event of default (as defined in the Advisory Agreement) would be excluded from the numerator of the calculation of the percentage of gross book value of the Company’s assets sold or disposed (but, for the avoidance of doubt, included in the denominator of such calculation) for purposes of determining whether a Company Change of Control (as defined in the Advisory Agreement) has occurred, from August 15, 2026 to November 15, 2026. On November 11, 2025, the Company entered into a definitive agreement to sell the 150-room Embassy Suites Houston located in Houston, Texas, and the 150-room Embassy Suites Austin located in Austin, Texas, for a combined purchase price of $27.0 million. The agreement included a nonrefundable deposit of $1.0 million which was paid on November 11, 2025. On December 9, 2025, the Company’s external advisor, Ashford Hospitality Advisors LLC, entered into an employment agreement with Stephen Zsigray, and the Company, along with Ashford Inc., entered into a related retention letter agreement. Under the retention arrangement, the Company agreed to provide Mr. Zsigray with monthly retention payments from April 2026 through March 2029, subject to the conditions specified in the agreement. In connection with these arrangements, the Company also executed a Limited Waiver under the Advisory Agreement to permit the Company to enter into and fund these obligations, including the reimbursement of certain severance ‑ or non ‑ compete ‑ related payments, under specified circumstances. On December 9, 2025, the Company terminated the primary offering of the Company’s Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock. The Company continued to offer shares of its Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock pursuant to its dividend reinvestment plan beyond the termination of the primary offering. On December 9, 2025, the Board suspended all redemptions of the Company’s Series J, Series K, Series L, and Series M Redeemable Preferred Stock. On December 9, 2025, the Company issued a press release announcing that the Board had formed a special committee composed of independent and disinterested directors. The Special Committee is authorized to evaluate strategic alternatives aimed at creating and enhancing stockholder value. On December 15, 2025, the Company declared a dividend of one Right for each outstanding share of common stock, each Right initially representing the right to purchase from the Company one one-thousandth of a share of Series N Preferred Stock at a price of $20.00 per one one-thousandth of a share of Series N Preferred Stock, subject to adjustment as provided in the Rights Agreement. Rights were issued in respect of all outstanding shares of common stock on December 26, 2025, the Record Date, and will be issued for all shares of common stock issued after the Record Date and, subject to the terms described in the Rights Agreement, prior to the earliest of the Distribution Date, the redemption of the Rights or the expiration of the Rights as provided by the Rights Agreement. The Rights Agreement is designed to prevent the Company from facing a substantial limitation on its ability to use its Tax Benefits (as such term is defined in the Rights Agreement) to offset potential future income taxes for federal income tax purposes and realize other efficiencies. Prior to exercise, a Right does not give its holder any rights as a stockholder of the Company, including without limitation, any dividend, voting or liquidation rights. Subject to certain exceptions specified in the Rights Agreement, the Rights will separate from the common stock and become exercisable at 5:00 p.m. New York City time on the next business day following the Distribution Date. Pursuant to the terms of the Rights 53
Page 56
Agreement, the Rights will expire on the earliest of (i) 5:00 p.m. New York City time on December 14, 2026, (ii) the effective date of the repeal of Section 382 of the Code or any successor statute if the Board determines in its sole discretion that the Rights Agreement is no longer necessary or desirable for the preservation of Tax Benefits, or (iii) the first day of a taxable year of the Company to which the Board determines in its sole discretion that no Tax Benefits may be carried forward, unless the Rights are earlier redeemed or exchanged by the Company, in each case as described below, or upon the occurrence of certain transactions. On December 18, 2025, the Company completed the sale of the 226-room Le Pavillon hotel located in New Orleans, Louisiana for $42.5 million, subject to customary pro rations and adjustments. On December 23, 2025, Ashford Inc. and Ashford Hospitality Advisors LLC delivered written notice to the Company of the Advisor’s election to extend the term of the Advisory Agreement for an additional ten-year term, commencing on January 14, 2031 and expiring on January 14, 2041. All terms, conditions, rights and obligations under the Advisory Agreement will remain in full force and effect during the extended term, subject to Section 6.5 of the Advisory Agreement that provides the parties to the Advisory Agreement the right to renegotiate the amount of the Base Fee or Incentive Fee (as such terms are defined in the Advisory Agreement) payable by the Company. On January 13, 2026, the Company extended its Highland mortgage loan secured by 18 hotels. As a condition to the extension, the loan was paid down by $10 million to a current balance of $723.6 million, or approximately 65% of appraised value, and has a final maturity date of July 9, 2026. On January 13, 2026, the Company announced that, to preserve the Company’s liquidity position as it evaluates strategic alternatives, preferred dividends have been suspended, including dividends previously declared for recordholders of the Company’s Series D, F, G, H, I, J, K, L and M preferred stock as of December 31, 2025, and payable on January 15, 2026. We intend to pay the previously declared but unpaid dividends as soon as reasonably practicable. Any accrued but unpaid dividends will accrue in accordance with the terms outlined in the applicable governing documents for each series of preferred stock. We will continue to evaluate potential future dividends on a quarterly basis. On February 9, 2026 and February 17, 2026, the Company completed the sales of the 150-room Embassy Suites Houston located in Houston, Texas, and the 150-room Embassy Suites Austin located in Austin, Texas, for a combined $27.0 million, subject to customary pro rations and adjustments. On February 11, 2026, the Company received a notice of default and acceleration from the lender relating to the Company’s mortgage loan on the JPM8 hotel properties. The notice followed the Company’s failure on February 9, 2026 to make certain required payments and deliver required documentation under the existing loan extension, which constituted an event of default under the loan agreement. As a result, the lender demanded immediate payment of the outstanding principal balance of $325 million, plus accrued interest, default interest, fees, and other amounts due, and also required delivery of a replacement interest rate cap agreement. The loan is secured by eight hotel properties. The notice does not trigger any cross ‑ defaults under other loans of the Company’s subsidiaries, and the Company has no indebtedness at the parent ‑ company level. On December 12, 2025, the Company entered into a definitive agreement to sell the 333-room Hilton St. Petersburg Bayfront located in St. Petersburg, Florida for a purchase price of $96 million. The agreement included nonrefundable deposits totaling $2.4 million which were paid in February 2026. The sale was completed on March 5, 2026. On February 24, 2026, the Company entered into a definitive agreement to sell the 157-room La Posada de Santa Fe located in Santa Fe, New Mexico for a purchase price of $57.5 million. The agreement included a nonrefundable deposit of $4.0 million which was paid on February 24, 2026. The sale was completed on March 17, 2026. Effective February 24, 2026, Sonny Sra retired from the Company’s board of directors due to health reasons. On February 25, 2026, the Company entered into definitive agreements to sell the 252-room Hilton Alexandria Old Town located in Alexandria, Virginia and the 160-room Embassy Suites Palm Beach Gardens located in Palm Beach, Florida for purchase prices of $58.0 million and $41.0 million, respectively. The agreements included nonrefundable deposits of $3.0 million and $2.1 million, respectively, which were paid in February of 2026. 54
Page 57
On March 5, 2026, Ashford Inc. and Ashford LLC agreed with Deric Eubanks, the Chief Financial Officer of Ashford Inc., and Ashford LLC that, effective March 31, 2026 (the “Termination Date”), Mr. Eubanks would terminate employment with and service to Ashford Inc., Ashford LLC and their affiliates. Mr. Eubanks is also the Chief Financial Officer of the Company and Braemar and accordingly his service as Chief Financial Officer of each of the Company and Braemar will also end effective as of the Termination Date. Effective on the Termination Date, Justin Coe, the Company’s current Chief Accounting Officer and principal accounting officer, will serve as the principal financial officer of the Company. On March 13, 2026, we entered into a Limited Waiver Under Advisory Agreement with Ashford Inc. and Ashford LLC (the “2026 Advisory Agreement Limited Waiver”). Pursuant to the 2026 Advisory Agreement Limited Waiver, the Company, the Operating Partnership, TRS, Ashford Inc. and Ashford LLC waive the operation of any provision in our advisory agreement that would otherwise limit the ability of the Company in its discretion, at the Company’s cost and expense, to award during calendar year 2026, cash incentive compensation to employees and other representatives of Ashford Inc. and Ashford LLC. On March 16, 2026, the Company entered into a definitive agreement to sell the 168-room Lakeway Resort & Spa located in Austin, Texas for a purchase price of $37.8 million. The agreement included a nonrefundable deposit of $500,000 which was paid on March 16, 2026. RESULTS OF OPERATIONS Key Indicators of Operating Performance We use a variety of operating and other information to evaluate the operating performance of our business. These key indicators include financial information that is prepared in accordance with GAAP as well as other financial measures that are non-GAAP measures. In addition, we use other information that may not be financial in nature, including statistical information and comparative data. We use this information to measure the operating performance of our individual hotels, groups of hotels and/or business as a whole. We also use these metrics to evaluate the hotels in our portfolio and potential acquisitions to determine each hotel’s contribution to cash flow and its potential to provide attractive long-term total returns. These key indicators include: • Occupancy—Occupancy means the total number of hotel rooms sold in a given period divided by the total number of rooms available. Occupancy measures the utilization of our hotels’ available capacity. We use occupancy to measure demand at a specific hotel or group of hotels in a given period. • ADR—ADR means average daily rate and is calculated by dividing total hotel rooms revenues by total number of rooms sold in a given period. ADR measures average room price attained by a hotel and ADR trends provide useful information concerning the pricing environment and the nature of the customer base of a hotel or group of hotels. We use ADR to assess the pricing levels that we are able to generate. • RevPAR—RevPAR means revenue per available room and is calculated by multiplying ADR by the average daily occupancy. RevPAR is one of the commonly used measures within the hotel industry to evaluate hotel operations. RevPAR does not include revenues from food and beverage sales or parking, telephone or other non-rooms revenues generated by the property. Although RevPAR does not include these ancillary revenues, it is generally considered the leading indicator of core revenues for many hotels. We also use RevPAR to compare the results of our hotels between periods and to analyze results of our comparable hotels (comparable hotels represent hotels we have owned for the entire period). RevPAR improvements attributable to increases in occupancy are generally accompanied by increases in most categories of variable operating costs. RevPAR improvements attributable to increases in ADR are generally accompanied by increases in limited categories of operating costs, such as management fees and franchise fees. RevPAR changes that are primarily driven by changes in occupancy have different implications for overall revenues and profitability than changes that are driven primarily by changes in ADR. For example, an increase in occupancy at a hotel would lead to additional variable operating costs (including housekeeping services, utilities and room supplies) and could also result in increases in other operating department revenues and expenses. Changes in ADR typically have a greater impact on operating margins and profitability as they do not have a substantial effect on variable operating costs. Occupancy, ADR and RevPAR are commonly used measures within the lodging industry to evaluate operating performance. RevPAR is an important statistic for monitoring operating performance at the individual hotel level and across our entire business. We evaluate individual hotel RevPAR performance on an absolute basis with comparisons to budget and prior periods, as well as on a regional and company-wide basis. ADR and RevPAR include only rooms revenue. Rooms revenue is dictated by demand (as measured by occupancy), pricing (as measured by ADR) and our available supply of hotel rooms. 55
Page 58
We also use funds from operations (“FFO”), Adjusted FFO, earnings before interest, taxes, depreciation and amortization for real estate (“EBITDAre”) and Adjusted EBITDAre as measures of the operating performance of our business. See “Non-GAAP Financial Measures.” Principal Factors Affecting Our Results of Operations The principal factors affecting our operating results include overall demand for hotel rooms compared to the supply of available hotel rooms, and the ability of our third-party management companies to increase or maintain revenues while controlling expenses. Demand—The demand for lodging, including business travel, is directly correlated to the overall economy; as GDP increases, lodging demand typically increases. Historically, periods of declining demand are followed by extended periods of relatively strong demand, which typically occurs during the growth phase of the lodging cycle. Supply—The development of new hotels is driven largely by construction costs, the availability of financing and expected performance of existing hotels. Short-term supply is also expected to be below long-term averages. While the industry is expected to have supply growth below historical averages, we may experience supply growth, in certain markets, in excess of national averages that may negatively impact performance. We expect that our ADR, occupancy and RevPAR performance will be impacted by macroeconomic factors such as national and local employment growth, personal income and corporate earnings, GDP, consumer confidence, office vacancy rates and business relocation decisions, airport and other business and leisure travel, new hotel construction, the pricing strategies of competitors and currency fluctuations. In addition, our ADR, occupancy and RevPAR performance are dependent on the continued success of the Marriott, Hilton and Hyatt brands. Revenue—Substantially all of our revenue is derived from the operation of hotels. Specifically, our revenue is comprised of: • Rooms revenue: Occupancy and ADR are the major drivers of rooms revenue. Rooms revenue accounts for the substantial majority of our total revenue. • Food and beverage revenue: Occupancy and the type of customer staying at the hotel are the major drivers of food and beverage revenue (i.e., group business typically generates more food and beverage business through catering functions when compared to transient business, which may or may not utilize the hotel’s food and beverage outlets or meeting and banquet facilities). • Other hotel revenue: Occupancy and the nature of the property are the main drivers of other ancillary revenue, such as telecommunications, parking and leasing services. Hotel Operating Expenses—The following presents the components of our hotel operating expenses: • Rooms expense: These costs include housekeeping wages and payroll taxes, reservation systems, room supplies, laundry services and front desk costs. Like rooms revenue, occupancy is the major driver of rooms expense and, therefore, rooms expense has a significant correlation to rooms revenue. These costs can increase based on increases in salaries and wages, as well as the level of service and amenities that are provided. • Food and beverage expense: These expenses primarily include food, beverage and labor costs. Occupancy and the type of customer staying at the hotel (i.e., catered functions generally are more profitable than restaurant, bar or other on-property food and beverage outlets) are the major drivers of food and beverage expense, which correlates closely with food and beverage revenue. • Management fees: Base management fees are computed as a percentage of gross revenue. Incentive management fees generally are paid when operating profits exceed certain threshold levels. • Other hotel expenses: These expenses include labor and other costs associated with the other operating department revenues, as well as labor and other costs associated with administrative departments, franchise fees, sales and marketing, repairs and maintenance and utility costs. Most categories of variable operating expenses, including labor costs such as housekeeping, fluctuate with changes in occupancy. Increases in occupancy are accompanied by increases in most categories of variable operating expenses, while increases in ADR typically only result in increases in limited categories of operating costs and expenses, such as franchise fees, management fees and credit card processing fee expenses which are based on hotel revenues. Thus, changes in ADR have a more significant impact on operating margins than changes in occupancy. 56
Page 59
The following table summarizes the changes in key line items from our consolidated statements of operations for the years ended December 31, 2025 and 2024 (in thousands): Year Ended December 31, Favorable(Unfavorable) Change 2025 2024 2023 2025 to 2024 2024 to 2023 Total revenue $ 1,104,388 $ 1,172,459 $ 1,367,533 $ (68,071) $ (195,074) Total hotel expenses (768,268) (815,356) (925,437) 47,088 110,081 Property taxes, insurance and other (59,793) (64,103) (70,226) 4,310 6,123 Depreciation and amortization (141,295) (152,776) (187,807) 11,481 35,031 Impairment charges (67,648) (59,331) — (8,317) (59,331) Advisory service fee (49,039) (58,606) (48,927) 9,567 (9,679) Corporate, general and administrative (20,783) (24,662) (16,181) 3,879 (8,481) Gain (loss) on consolidation of VIE and disposition of assets andhotel properties 79,799 94,406 11,488 (14,607) 82,918 Gain (loss) on derecognition of assets 39,054 167,177 — (128,123) 167,177 Operating income (loss) 116,415 259,208 130,443 (142,793) 128,765 Equity in earnings (loss) of unconsolidated entities (325) (2,370) (1,134) 2,045 (1,236) Interest income 4,739 6,942 8,978 (2,203) (2,036) Other income (expense) — 108 310 (108) (202) Interest expense and amortization of discounts and loan costs (256,229) (273,359) (326,970) 17,130 53,611 Interest expense associated with hotels in receivership (39,038) (45,592) (39,178) 6,554 (6,414) Write-off of premiums, loan costs and exit fees (8,853) (5,245) (3,469) (3,608) (1,776) Gain (loss) on extinguishment of debt 335 2,774 53,386 (2,439) (50,612) Realized and unrealized gain (loss) on derivatives (5,346) (6,480) (2,200) 1,134 (4,280) Income tax benefit (expense) 143 (997) (900) 1,140 (97) Net income (loss) (188,159) (65,011) (180,734) (123,148) 115,723 (Income) loss from consolidated entities attributable tononcontrolling interests 5,058 4,028 6 1,030 4,022 Net (income) loss attributable to redeemable noncontrollinginterests in operating partnership 3,262 683 2,239 2,579 (1,556) Net income (loss) attributable to the Company $ (179,839) $ (60,300) $ (178,489) $ (119,539) $ 118,189 57
Page 60
All hotel properties held during the years ended December 31, 2025 and 2024 have been included in our results of operations during the respective periods in which they were held. Based on when a hotel property was acquired or disposed, operating results for certain hotel properties are not comparable for the years ended December 31, 2025 and 2024. The hotel properties listed below are not comparable hotel properties for the periods indicated and all other hotel properties are considered comparable hotel properties. The following transactions affect the reporting comparability of our consolidated financial statements: Hotel Properties Location Type Date Courtyard Columbus Tipton Lakes Columbus, IN Derecognized March 1, 2024 Courtyard Old Town Scottsdale, AZ Derecognized March 1, 2024 Residence Inn Hughes Center Las Vegas, NV Derecognized March 1, 2024 Residence Inn Phoenix Airport Phoenix, AZ Derecognized March 1, 2024 Residence Inn San Jose Newark Newark, CA Derecognized March 1, 2024 SpringHill Suites Manhattan Beach Hawthorne, CA Derecognized March 1, 2024 SpringHill Suites Plymouth Meeting Plymouth Meeting, PA Derecognized March 1, 2024 Courtyard Basking Ridge Basking Ridge, NJ Derecognized March 1, 2024 Courtyard Newark Silicon Valley Newark, CA Derecognized March 1, 2024 Courtyard Oakland Airport Oakland, CA Derecognized March 1, 2024 Courtyard Plano Legacy Park Plano, TX Derecognized March 1, 2024 Residence Inn Plano Plano, TX Derecognized March 1, 2024 SpringHill Suites BWI Airport Baltimore, MD Derecognized March 1, 2024 TownePlace Suites Manhattan Beach Hawthorne, CA Derecognized March 1, 2024 Residence Inn Salt Lake City Salt Lake City, UT Disposition March 6, 2024 Hilton Boston Back Bay Boston, MA Disposition April 9, 2024 Hampton Inn Lawrenceville Lawrenceville, GA Disposition April 23, 2024 Courtyard Manchester Manchester, CT Disposition May 30, 2024 SpringHill Suites Kennesaw Kennesaw, GA Disposition June 10, 2024 Fairfield Inn Kennesaw Kennesaw, GA Disposition June 10, 2024 One Ocean Atlantic Beach, FL Disposition June 27, 2024 The Ashton Fort Worth, TX Disposition July 16, 2024 Le Méridien Fort Worth Fort Worth, TX Developed August 29, 2024 Courtyard Boston Boston, MA Disposition January 10, 2025 Residence Inn Evansville Evansville, IN Disposition August 11, 2025 Hilton NASA Clear Lake Houston, TX Disposition August 22, 2025 Residence Inn San Diego San Diego, CA Disposition October 15, 2025 Le Pavillon New Orleans, LA Disposition December 18, 2025 ____________________________________ Referred to as “Hotel Dispositions.” Referred to as “KEYS A and B properties.” The following table illustrates the key performance indicators of the operating hotel properties included in our results of operations: Year Ended December 31, 2025 2024 RevPAR (revenue per available room) $ 131.68 $ 132.87 Occupancy 70.26 % 69.66 % ADR (average daily rate) $ 187.41 $ 190.75 (2) (2) (2) (2) (2) (2) (2) (2) (2) (2) (2) (2) (2) (2) (1) (1) (1) (1) (1) (1) (1) (1) (1) (1) (1) (1) (1) (1) (2) 58
Page 61
The following table illustrates the key performance indicators of the 67 comparable hotel properties that were included in our results of operations for the full years ended December 31, 2025 and 2024, respectively: Year Ended December 31, 2025 2024 RevPAR $ 132.61 $ 134.02 Occupancy 69.50 % 71.13 % ADR $ 190.82 $ 188.40 Comparison of the Year Ended December 31, 2025 and 2024 Net Income (Loss) Attributable to the Company. Net income (loss) attributable to the Company changed $119.5 million from a net loss of $60.3 million for the year ended December 31, 2024 (“2024”) to a net loss of $179.8 million for the year ended December 31, 2025 (“2025”) as a result of the factors discussed below. Revenue. Rooms revenue from our hotel properties decreased $64.1 million, or 7.2%, to $825.6 million in 2025 compared to 2024. This decrease in 2025 is primarily attributable to decreases in rooms revenue of $48.5 million from our Hotel Dispositions, $13.7 million from the KEYS A and B properties that went into receivership in 2024 and $8.6 million at our comparable hotel properties. These decreases were partially offset by an increase of $6.7 million in rooms revenue from the Le Méridien Fort Worth which opened in August of 2024 (the “Le Méridien Opening”). Our comparable hotel properties experienced an increase of 1.3% in room rates and a decrease of 163 basis points in occupancy. Food and beverage revenue decreased $5.0 million, or 2.3%, to $207.6 million in 2025 compared to 2024. This decrease in 2025 is primarily attributable to decreases in food and beverage revenue of $7.1 million from our Hotel Dispositions and $404,000 from the KEYS A and B properties. These decreases were partially offset by higher food and beverage revenue of $1.2 million at our comparable hotel properties and $1.3 million from the Le Méridien Opening. Other hotel revenue, which consists mainly of internet access, parking, and spa revenue, increased $1.8 million, or 2.7%, to $69.6 million in 2025 compared to 2024. This increase in 2025 is primarily attributable to increases in other hotel revenue of $7.2 million from our comparable hotel properties and $522,000 from the Le Méridien Opening. These increases were partially offset by lower other hotel revenue of $5.4 million from our Hotel Dispositions and $488,000 from the KEYS A and B properties. Other revenue decreased $791,000, or 34.0%, to $1.5 million in 2025 compared to 2024. Hotel Operating Expenses. Hotel operating expenses decreased $47.1 million, or 5.8%, to $768.3 million in 2025 compared to 2024. Hotel operating expenses consist of direct expenses from departments associated with revenue streams and indirect expenses associated with support departments and management fees. Direct expenses decreased $17.7 million in 2025 compared to 2024, comprising a decrease of $18.5 million from our Hotel Dispositions and $3.9 million from the KEYS A and B properties. The decrease in direct expenses was partially offset by an increase in 2025 of $1.9 million from our comparable hotel properties and $2.7 million from the Le Méridien Opening, respectively. Direct expenses were 31.5% of total hotel revenue for 2025 and 31.2% for 2024. Indirect expenses and management fees decreased $29.4 million in 2025 compared to 2024, comprising a decrease of $23.7 million from our Hotel Dispositions, $751,000 from our comparable hotel properties and $6.6 million from the KEYS A and B properties. These decreases in 2025 were partially offset by an increase of $1.6 million from the Le Méridien Opening. Property Taxes, Insurance and Other. Property taxes, insurance and other expense decreased $4.3 million or 6.7%, to $59.8 million in 2025 compared to 2024. The decrease in 2025 was primarily due to a decrease of $4.9 million from our Hotel Dispositions and $1.0 million from the KEYS A and B properties. The decrease in 2025 was partially offset by an increase of $933,000 from our comparable hotel properties and $628,000 from the Le Méridien Opening. Depreciation and Amortization. Depreciation and amortization decreased $11.5 million or 7.5%, to $141.3 million in 2025 compared to 2024. The decrease in 2025 was primarily due to lower depreciation of $5.7 million from our Hotel Dispositions, $6.4 million from our comparable hotels and $1.8 million from the KEYS A and B properties. The decrease in 2025 was partially offset by an increase of $2.5 million from the Le Méridien Opening. Impairment Charges. Impairment charges were $67.6 million in 2025 and $59.3 million in 2024. In 2025, these charges included $31.5 million related to the Hilton Alexandria Old Town, $18.4 million related to the New Orleans Le Pavillon Hotel, $16.3 million related to the Hilton Santa Cruz Scotts Valley and $1.4 million related to the Residence Inn Evansville. In 2024, 59
Page 62
these charges included $35.9 million related to the Hilton Costa Mesa and $23.4 million related to the Embassy Suites Portland. See note 5 to our consolidated financial statements. Advisory Services Fee. The advisory services fee decreased $9.6 million, or 16.3%, to $49.0 million in 2025 compared to 2024. The advisory services fee represents fees incurred in connection with the advisory agreements between Ashford Inc. and the Company and, prior to September 2, 2025, between Ashford Inc. and Stirling OP. In 2025, the advisory services fee primarily comprised a base advisory fee of $32.9 million, reimbursable expenses of $16.3 million and fees totaling $687,000 associated with Stirling OP’s advisory agreement. In 2024, the advisory services fee comprised a base advisory fee of $32.0 million, equity-based compensation of $1.8 million awarded to the officers and employees of Ashford Inc., reimbursable expenses of $23.7 million and fees totaling $1.1 million associated with Stirling OP’s advisory agreement. Corporate, General and Administrative. Corporate, general and administrative expenses decreased $3.9 million, or 15.7%, to $20.8 million in 2025 compared to 2024. The decrease was primarily attributable to a decrease in reimbursements of Ashford Securities’ operating expenses of $2.3 million, miscellaneous expenses of $1.4 million and public company costs of $750,000. The decrease in 2025 was partially offset by an increase of $569,000 in legal and professional expenses. Gain (Loss) on Consolidation of VIE and Disposition of Assets and Hotel Properties. Gain on consolidation of VIE and disposition of assets and hotel properties decreased $14.6 million, from $94.4 million in 2024 to $79.8 million in 2025. The gain in 2025 was primarily related to the sale of five of our hotel properties in 2025. Other increases include the sale of a parcel of land previously owned by our Residence Inn Orlando property in April 2025. The gain in 2024 was primarily related to the sale of seven of our hotel properties in 2024. Gain (Loss) on Derecognition of Assets. Gain on derecognition of assets decreased $128.1 million, from $167.2 million in 2024 to $39.1 million in 2025. The gain primarily represents the increase of the contract asset on our consolidated balance sheets. We record a contract asset associated with the accrued interest expense from the default of the KEYS A and KEYS B loans as we expect to be released from this obligation upon final resolution with the lender. The gain in 2025 relates to accrued interest on the KEYS A and B properties in receivership and the transfer of the Courtyard Oakland and the SpringHill Suites BWI Airport to a third-party purchaser in December 2025 and June 2025, respectively. In 2024, the gain primarily related to a gain of $133.9 million from the initial derecognition of assets of the KEYS A and B properties in March of 2024 and additional gains of $33.3 million from the associated accrued interest expense in 2024. See note 7 to our consolidated financial statements. Equity in Earnings (Loss) of Unconsolidated Entities. Equity in loss of unconsolidated entities was $325,000 in 2025 and $2.4 million in 2024. Equity in loss primarily results from our investment in an entity that owns the Meritage Resort and Spa and the Grand Reserve at the Meritage in Napa, California. Interest Income. Interest income was $4.7 million and $6.9 million in 2025 and 2024, respectively. The decrease in interest income in 2025 was primarily attributable to lower excess cash balances in 2025 compared to 2024. Other Income (Expense). In 2025 and 2024, we recorded miscellaneous income of $0 and $108,000, respectively. Interest Expense and Amortization of Discounts and Loan Costs. Interest expense and amortization of discounts and loan costs decreased $17.1 million, or 6.3%, to $256.2 million in 2025 compared to 2024. The decrease was primarily due to lower cash interest expense and amortization of loan costs of $19.4 million as a result of the pay-off of the Oaktree loan in February 2025 and a $15.9 million decrease from our Hotel Dispositions. These decreases were partially offset by higher default interest and late charges recorded on mortgage loans in default of $6.0 million, higher interest expense and amortization of discounts and loan costs at our comparable hotels of $2.8 million and higher interest expense of $9.4 million from the Le Méridien Opening. Interest Expense Associated with Hotels in Receivership. Interest expense associated with hotels in receivership decreased $6.6 million, from $45.6 million in 2024 to $39.0 million in 2025. The decrease is due to five fewer hotels being under receivership for the entire period in 2025 compared to 2024. On July 2, 2024, the Courtyard Plano Legacy Park and the Residence Inn Plano were foreclosed on at a public auction. Additionally, on November 4, 2024, the receiver appointed for the KEYS Pool A and KEYS Pool B mortgage loans transferred the Courtyard Columbus Tipton Lakes to a third-party purchaser. On June 25, 2025 and December 22, 2025, the Courtyard Oakland and SpringHill Suites BWI Airport mortgage loans were also transferred to a third-party purchaser. As a result, the contract asset and corresponding indebtedness associated with hotels in receivership and accrued interest associated with hotels in receivership were reduced for the amounts attributable to each hotel. See note 7 to our consolidated financial statements. 60
Page 63
Write-off of Premiums, Loan Costs and Exit Fees. Write-off of premiums, loan costs and exit fees was $8.9 million in 2025 and $5.2 million in 2024. The balance in 2025 primarily related to fees of $6.1 million from loan refinances and modifications and fees of $2.2 million related to prepayment penalties and exit fees on loan refinances. The balance in 2024 primarily related to fees of $4.4 million related to loan refinances and modifications and $817,000 of unamortized loan cost write-offs. Gain (Loss) on Extinguishment of Debt. Gain (loss) on extinguishment of debt resulted in a gain of $335,000 in 2025 and a gain of $2.8 million in 2024. In June 2024, the Company was informed by its lender that the lender intended to exercise remedies for the maturity default on the Ashton Hotel in Fort Worth, Texas, which secured the Company’s $8.9 million mortgage loan. The Company and the lender agreed to a deed-in-lieu of foreclosure, which was completed on July 16, 2024 and resulted in a gain on extinguishment of debt of approximately $2.6 million. Realized and Unrealized Gain (Loss) on Derivatives. Realized and unrealized gain (loss) on derivatives changed by $1.1 million from a $6.5 million loss in 2024 to a $5.3 million loss in 2025. In 2025, we recognized $6.5 million of net unrealized losses on our derivatives which were primarily attributable to interest rate caps. These unrealized losses were partially offset by net realized gains on interest rate caps of $1.2 million. In 2024, we recognized an unrealized loss of $27.4 million associated with interest rate caps and an unrealized loss of $5.4 million from the revaluation of the embedded debt derivative in the Oaktree Agreement. These unrealized losses were partially offset by net realized gains on interest rate caps of $26.3 million. Income Tax (Expense) Benefit. Income tax (expense) benefit changed $1.1 million, from income tax expense of $1.0 million in 2024 to an income tax benefit of $143,000 in 2025. The change is primarily due to decreases in the current state taxes of certain of our taxable entities. (Income) Loss from Consolidated Entities Attributable to Noncontrolling Interests. Our noncontrolling interest partners in consolidated entities were allocated a loss of $5.1 million and $4.0 million in 2025 and 2024, respectively. Noncontrolling interests in consolidated entities represented an ownership interest of 70.7% in 815 Commerce MM and, prior to September 2, 2025, 0.30% in Stirling OP. See notes 1 and 2 to our consolidated financial statements. Net (Income) Loss Attributable to Redeemable Noncontrolling Interests in Operating Partnership. Redeemable noncontrolling interests in operating partnership were allocated a net loss of $3.3 million in 2025 and a net loss of $683,000 in 2024. Redeemable noncontrolling interests represented ownership interests of 1.43% and 1.02% in the operating partnership as of December 31, 2025 and 2024, respectively. LIQUIDITY AND CAPITAL RESOURCES Liquidity As of December 31, 2025, the Company held cash and cash equivalents of $66.8 million and restricted cash of $149.6 million (including amounts held for sale), the vast majority of which comprises lender and manager-held reserves. As of December 31, 2025, $25.7 million (including amounts held for sale) was also due to the Company from third-party hotel managers, most of which is held by one of the Company’s managers and is available to fund hotel operating costs. During the year ended December 31, 2025, the net decrease in cash, cash equivalents and restricted cash (including cash, cash equivalents and restricted cash held for sale) was $4.1 million. As described in note 2 to our consolidated financial statements, the Company forecasts it may not have enough cash to support the Company’s daily operations one year from the date the financial statements are issued due primarily to anticipated debt service costs, debt maturities and the potential termination fee the Company would owe to Ashford LLC upon the triggering of the change of control provision in the Advisory Agreement. We have $1.9 billion of non-recourse loans that mature within one year from the date the financial statements are issued. If these loans are not refinanced and our lenders elect to foreclose on these properties, the change of control provision in the Advisory Agreement could be triggered beginning November 16, 2026 resulting in a termination fee (as defined in the Advisory Agreement.) We are taking several steps to reduce our cash utilization and potentially raise additional capital. The Company’s ability to continue as a going concern is dependent upon its ability to improve the profitability of its operations, refinance or extend the maturity of our loans and increase our cash position from the sale of certain hotel properties. While the Company believes in the viability of its strategy, GAAP requires that in making this determination the Company cannot consider any remedies outside of the Company’s control which have not been fully implemented. As such, the Company could not consider future potential fundraising activities, whether through equity or debt offerings or dispositions of hotel properties as we could not conclude they were probable of being effectively implemented. 61
Page 64
With respect to upcoming maturities, no assurances can be given that we will be able to refinance our upcoming maturities. Additionally, no assurances can be given that we will obtain additional financings or, if we do, what the amount and terms will be. Our failure to obtain future financing under favorable terms could adversely impact our ability to execute our business strategy or may result in lender foreclosure. Based on these factors, the Company has determined that there is substantial doubt about the Company’s ability to continue as a going concern within one year after the date the financial statements are issued. The consolidated financial statements have been prepared assuming that the Company will continue as a going concern and do not include any adjustments that might result from the outcome of this uncertainty. The Company’s cash and cash equivalents primarily comprised corporate cash invested in short-term U.S. Treasury securities with maturity dates of less than 90 days and corporate cash held at commercial banks in Insured Cash Sweep (“ICS”) accounts, which are fully insured by the FDIC. The Company’s cash and cash equivalents also includes property-level operating cash deposited with commercial banks that have been designated as a Global Systemically Important Bank (“G-SIB”) by the Financial Stability Board (“FSB”) and a small amount deposited with other commercial banks. Our cash position from operations is affected primarily by macro industry movements in occupancy and rates as well as our ability to control costs. Further, interest rates can greatly affect the cost of our debt service as well as the value of any financial hedges we may put in place. We monitor industry fundamentals and interest rates very closely. Capital expenditures above our reserves will affect cash flow as well and are impacted by inflation. Certain of our loan agreements contain cash trap provisions that may be triggered if the performance of our hotels declines below a threshold. When these provisions are triggered, substantially all of the profit generated by our hotels is deposited directly into lockbox accounts and then swept into cash management accounts for the benefit of our various lenders. During a cash trap, certain disbursements from these hotel operating cash receipts would require consent of our lenders. At December 31, 2025, 43 of our hotels were in cash traps and approximately $4.5 million of our restricted cash was subject to these cash traps. Our loans currently in cash traps may remain subject to cash trap provisions for a substantial period of time, which could limit our flexibility and adversely affect our financial condition or our qualification as a REIT. We have extension options relating to certain property-level loans that will permit us to extend the maturity date of our loans if certain conditions are satisfied at the respective extension dates, including the achievement of debt yield targets required in order to extend such loans. To the extent we decide to extend the maturity date of the debt outstanding under the loans, we may be required to prepay a significant amount of the loans in order to meet the required debt yield targets. There can be no assurances that we will be able to meet the conditions for extensions pursuant to the respective terms of such loans. If we violate covenants in our debt agreements, we could be required to repay all or a portion of our indebtedness before maturity at a time when we might be unable to arrange financing for such repayment on attractive terms, if at all. The assets of certain of our subsidiaries are pledged under non-recourse indebtedness and are not available to satisfy the debts and other obligations of Ashford Trust or Ashford Trust OP, our operating partnership, and the liabilities of such subsidiaries do not constitute the obligations of Ashford Trust or Ashford Trust OP. Mortgage and mezzanine loans are non-recourse to the borrowers, except for customary exceptions or carve-outs that trigger recourse liability to the borrowers in certain limited instances. Recourse obligations typically include only the payment of costs and liabilities suffered by lenders as a result of the occurrence of certain bad acts on the part of the borrower. However, in certain cases, carve-outs could trigger recourse obligations on the part of the borrower with respect to repayment of all or a portion of the outstanding principal amount of the loans. We have entered into customary guaranty agreements pursuant to which we guaranty payment of any recourse liabilities of the borrowers that result from non-recourse carve-outs (which include, but are not limited to, fraud, misrepresentation, willful conduct resulting in waste, misappropriation of rents following an event of default, voluntary bankruptcy filings, unpermitted transfers of collateral and certain environmental liabilities). In the opinion of management, none of these guaranty agreements, either individually or in the aggregate, are likely to have a material adverse effect on our business, results of operations, or financial condition. Pursuant to the Advisory Agreement between us and our advisor, we must pay our advisor on a monthly basis a base management fee, subject to a minimum base management fee. The minimum base management fee is equal to the greater of: (i) 90% of the base fee paid for the same month in the prior fiscal year; and (ii) 1/12th of the “G&A Ratio” for the most recently completed fiscal quarter multiplied by our total market capitalization on the last balance sheet date included in the most recent quarterly report on Form 10-Q or annual report on Form 10-K that we file with the SEC. Thus, even if our total market capitalization and performance decline, we will still be required to make payments to our advisor equal to the minimum base management fee, which could adversely impact our liquidity and financial condition. 62
Page 65
We have entered into certain customary guaranty agreements pursuant to which we guarantee payment of any recourse liabilities of our subsidiaries or joint ventures that may result from non-recourse carve-outs, which include, but are not limited to, fraud, misrepresentation, willful misconduct resulting in waste, misappropriation of rents following an event of default, voluntary bankruptcy filings, unpermitted transfers of collateral, delinquency of trade payables and certain environmental liabilities. Certain of these guarantees represent a guaranty of material amounts, and if we are required to make payments under those guarantees, our liquidity could be adversely affected. Our existing hotel properties are mostly located in developed areas with competing hotel properties. Future occupancy, ADR, and RevPAR of any individual hotel could be materially and adversely affected by an increase in the number or quality of competitive hotel properties, home-sharing companies or apartment operators offering short-term rentals in its market area. Competition could also affect the quality and quantity of future investment opportunities. Our estimated future obligations as of December 31, 2025 include both current and long-term obligations. With respect to our indebtedness as of December 31, 2025, as discussed in note 7 to our consolidated financial statements, we have current obligations of $1.5 billion and long-term obligations of $1.1 billion. As of December 31, 2025, we have $1.1 billion of mortgage loans that have final maturities in 2026. We hold extension options for the remaining mortgage loans due in the next twelve months. Additionally, we have amortization payments of approximately $149,000 due in the next twelve months. Subsequent to December 31, 2025, we refinanced one mortgage loan with an outstanding loan balance of approximately $733.6 million that had a final maturity in 2026. We additionally exercised the first one- year extension option on our Morgan Stanley Pool mortgage loan and paid down $111.1 million in principal on the loan in conjunction with the sales of the Hilton St. Petersburg Bayfront, the Embassy Suites Austin and the Embassy Suites Houston. On March 17, 2026, we additionally paid down $56.0 million in principal on our Aareal two-pack mortgage loan in conjunction with the sale of the La Posada de Santa Fe. As discussed in note 19 to our consolidated financial statements, under our operating and finance leases we have current obligations of $5.7 million and long-term obligations of $258.7 million. Additionally, we have short-term capital commitments of $64.2 million. Debt Transactions Derecognition of Assets The KEYS mortgage loans were entered into on June 13, 2018, each of which had a two-year initial term and five one-year extension options. In order to qualify for a one-year extension in June of 2023, each KEYS loan pool was required to achieve a certain debt yield test. The Company extended its KEYS Pool C loan with a paydown of approximately $62.4 million, its KEYS Pool D loan with a paydown of approximately $25.6 million, and its KEYS Pool E loan with a paydown of approximately $41.0 million. On July 7, 2023, the Company elected not to make the required paydowns to extend its KEYS Pool A loan, KEYS Pool B loan and KEYS Pool F loan thereby defaulting on such loans. On November 29, 2023, the Company completed the deed in lieu of foreclosure transaction for the transfer of ownership of the KEYS Pool F $215.1 million mortgage to the mortgage lender. The Company continues to work with the lender of the KEYS A and KEYS B loan pools on a consensual transfer of ownership of those hotels to the lender. The original lenders previously transferred the loans to a securitization trust. On March 1, 2024, the Company received notice that the hotel properties that secured the KEYS Pool A and KEYS Pool B loans have been transferred to a court-appointed receiver. Below is a summary of the hotel properties that secured the KEYS Pool A and Pool B loans: KEYS A Loan Pool Courtyard Columbus Tipton Lakes – Columbus, IN Courtyard Old Town – Scottsdale, AZ Residence Inn Hughes Center – Las Vegas, NV Residence Inn Phoenix Airport – Phoenix, AZ Residence Inn San Jose Newark – Newark, CA SpringHill Suites Manhattan Beach – Hawthorne, CA SpringHill Suites Plymouth Meeting – Plymouth Meeting, PA KEYS B Loan Pool Courtyard Basking Ridge – Basking Ridge, NJ Courtyard Newark Silicon Valley – Newark, CA 63
Page 66
Courtyard Oakland Airport – Oakland, CA Courtyard Plano Legacy Park – Plano, TX Residence Inn Plano – Plano, TX SpringHill Suites BWI Airport – Baltimore, MD TownePlace Suites Manhattan Beach – Hawthorne, CA We derecognized the hotel properties that secured the KEYS Pool A and KEYS Pool B loans from our consolidated balance sheet in March 2024, when the receiver took control of the hotel properties and, accordingly, recognized a gain of $133.9 million, which is included in “gain (loss) on derecognition of assets” in our consolidated statements of operations for the three months ended March 31, 2024. We recorded a contract asset of $378.2 million as of March 31, 2024, which represented the liabilities from which we expect to be released upon final resolution with the lenders on the KEYS Pool A and KEYS Pool B mortgage loans in exchange for the transfer of ownership of the respective hotel properties. Subsequent to March 31, 2024, we recognized an additional gain of $33.3 million that increased the contract asset by a corresponding amount. The additional gain primarily represents the additional accrued interest expense recorded through December 31, 2024. In total for the year ended December 31, 2024, we recognized a gain of $167.2 million. On July 2, 2024, the Courtyard Plano Legacy Park and the Residence Inn Plano were foreclosed on at a public auction. Additionally, on November 4, 2024, the receiver appointed for the KEYS Pool A and KEYS Pool B mortgage loans transferred the Courtyard Columbus Tipton Lakes to a third-party purchaser. As a result, the contract asset and corresponding indebtedness associated with hotels in receivership and accrued interest associated with hotels in receivership were reduced for the amounts attributable to each hotel. For the year ended December 31, 2025, we recognized an additional gain of $39.1 million, which was included in “gain (loss) on derecognition of assets” in our consolidated statement of operations that increased the contract asset by a corresponding amount. The KEYS Pool A and the KEYS Pool B mortgage loans, as well as all accrued and unpaid interest, default charges and late fees will remain liabilities until final resolution with the lenders is concluded. On June 25, 2025 and December 22, 2025, the receiver appointed for the KEYS Pool A and KEYS Pool B mortgage loans transferred the Courtyard Oakland and SpringHill Suites BWI Airport to a third-party purchaser. Additionally, on March 4, 2026, the receiver appointed for the KEYS Pool A and KEYS Pool B mortgage loans transferred the SpringHill Suites Plymouth Meeting to a third-party purchaser. As a result, the contract asset and corresponding indebtedness associated with hotels in receivership and accrued interest associated with hotels in receivership were reduced for the amounts attributable to each hotel. Other Loan Activity On February 12, 2025, the Company closed on a $580 million refinancing secured by 16 hotels. The financing includes the hotels that were previously part of the Company’s KEYS Pool C Loan, KEYS Pool D Loan, KEYS Pool E Loan, and the BAML Pool 3 Loan, together with the Westin Princeton. The previous loans had a combined outstanding loan balance of approximately $438.7 million. The new financing is non-recourse, has a two-year term with three one-year extension options, subject to the satisfaction of certain conditions. The Company used approximately $72 million of the excess proceeds to completely pay off the remaining balance on the Oaktree Credit Agreement, including the $30.0 million exit fee. On February 24, 2025, the Company amended its mortgage loan secured by the 141-room Hotel Indigo Atlanta Midtown in Atlanta, Georgia. Terms of the amendment included extending the current maturity date to February 2026 and adding one one-year extension option, subject to satisfaction of certain conditions. On March 6, 2025, the $22.1 million non-recourse mortgage loan secured by the Hilton Santa Cruz Scotts Valley reached final maturity and was not repaid, resulting in a default under the terms and conditions of the mortgage loan agreement. On March 17, 2026, the Company was notified the lender intends to appoint a receiver for the property. On April 14, 2025, the Company successfully extended its Morgan Stanley Pool mortgage loan secured by 17 hotels. The loan had an original final maturity date in November of 2024. The extension provides for an initial maturity in March of 2026 and two one-year extension options, subject to the satisfaction of certain conditions, with a final maturity date in March of 2028. In March of 2026, the Company exercised its first extension option. On May 8, 2025, the Company received $35.0 million in return for a preferred equity investment in the Renaissance Hotel in Nashville, Tennessee. The holder is entitled to an all-in rate of return on the preferred equity of 14.0% per annum. The 64
Page 67
investment is mandatorily redeemable on May 10, 2029. On July 30, 2025, the Company extended its Highland mortgage loan secured by 18 hotels with an original maturity date of April 2025. Terms of the amendment included a $10.0 million principal paydown, extending the maturity date to January 9, 2026. The loan is subject to a six-month extension option to July 9, 2026, upon satisfaction of certain conditions. On August 14, 2025, Ashford Trust OP executed a promissory note with Ashford LLC allowing Ashford Trust OP to draw up to $20 million in cash through August 15, 2026 to fund certain permitted costs (as defined in the promissory note). Funds advanced under the promissory note bear interest at an annual rate of 10.0% which may be paid in cash or paid in-kind at Ashford OP’s discretion. The maturity date of the promissory note was August 15, 2026, at which time all principal drawn upon and outstanding interest would have been due and payable. As collateral to secure the repayment of any amounts advanced by Ashford LLC under the promissory note, the Company pledged to Ashford LLC the Company’s equity in Ashford Trust OP subject to Ashford LLC’s filing of a financing statement in the appropriate jurisdiction. On November 10, 2025, the promissory note was amended and restated. See below. On September 15, 2025, the Company refinanced the mortgage loan for the Renaissance Hotel in Nashville, Tennessee. The new, non- recourse loan has a balance of $218.1 million and has a two-year term with three one-year extension options, subject to the satisfaction of certain conditions, with a final maturity date of September 2030. The loan is interest only. In conjunction with the debt refinancing, the preferred equity investment on the property was upsized by $53.0 million, and the all-in rate of return on the preferred equity was reduced from 14% to 11.14%. On November 10, 2025, Ashford Trust OP executed an Amended and Restated Master Line of Credit Promissory Note (the “Amended and Restated Promissory Note”) with Ashford Hospitality Advisors LLC (“Ashford LLC”), a subsidiary of Ashford Inc., amending the original Master Line of Credit Promissory note, dated August 14, 2025, allowing Ashford Trust OP to draw up to $40 million in cash through November 15, 2026 to fund Permitted Costs (as defined in the Promissory Note). Funds advanced under the Amended and Restated Promissory Note bear interest at an annual rate of 10.0% which may be paid in cash or paid in-kind at Ashford OP’s discretion. The maturity date of the Amended and Restated Promissory Note is November 15, 2026, at which time all principal drawn upon and outstanding interest are due and payable. As collateral to secure the repayment of any amounts advanced by Ashford LLC under the Amended and Restated Promissory Note, the Company pledged to Ashford LLC the Company’s equity in Ashford Trust OP subject to Ashford LLC’s filing of a financing statement in the appropriate jurisdiction. On January 13, 2026, the Company extended its Highland mortgage loan secured by 18 hotels. As a condition to the extension, the loan was paid down by $10 million to a current balance of $723.6 million, or approximately 65% of appraised value, and has a final maturity date of July 9, 2026. On February 11, 2026, the Company received a notice of default and acceleration from the lender relating to the Company’s mortgage loan on the JPM8 hotel properties. The notice followed the Company’s failure on February 9, 2026 to make certain required payments and deliver required documentation under the existing loan extension, which constituted an event of default under the loan agreement. As a result, the lender demanded immediate payment of the outstanding principal balance of $325 million, plus accrued interest, default interest, fees, and other amounts due, and also required delivery of a replacement interest rate cap agreement. The loan is secured by eight hotel properties. The notice does not trigger any cross ‑ defaults under other loans of the Company’s subsidiaries, and the Company has no indebtedness at the parent ‑ company level. Equity Transactions The board of directors has approved a stock repurchase program (the “Repurchase Program”) to acquire shares of the Company’s common stock and preferred stock having an aggregate value of up to $200 million. No shares have been repurchased under the Repurchase Program. The ability to make repurchases under the Repurchase Program is subject to the same financial factors that must be taken into account in declaring a dividend as discussed herein under “Distribution Policy.” The Company has a distribution agreement with Virtu (the “Virtu Equity Distribution Agreement”) to sell from time to time shares of the Company’s common stock having an aggregate offering price of up to $100 million. We will pay Virtu a commission of approximately 1% of the gross sales price of the shares of our common stock sold. The Company may also sell some or all of the shares of our common stock to Virtu as principal for its own account at a price agreed upon at the time of sale. As of March 18, 2026, the Company has issued approximately 813,000 shares of common stock for gross proceeds of approximately $10.9 million under the Virtu Equity Distribution Agreement. On April 29, 2025, the Company filed a shelf registration statement on Form S-3 with the SEC relating to common stock, preferred stock, depositary shares, debt securities, warrants, rights and units that we may sell from time to time in one or more 65
Page 68
offerings up to a total dollar amount of $500,000,000 on terms to be determined at the time of sale. The registration statement was declared effective on May 8, 2025. As a result of the Company not paying dividends to the holders of our Preferred Stock on January 15, 2026, we are no longer eligible to use our existing shelf registration statement on Form S-3. As of March 18, 2026, the Company has not issued any securities from this registration statement. On December 13, 2024, the Company filed an initial registration statement on Form S-11 with the SEC, as amended on January 23, 2025, related to the Company’s non-traded Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock. The registration statement was declared effective by the SEC on February 7, 2025, and contemplates the offering of up to (i) 8.4 million shares of Series L Redeemable Preferred Stock and 3.6 million shares of Series M Redeemable Preferred Stock in a primary offering and (ii) 2.8 million shares of Series L Redeemable Preferred Stock and 1.2 million shares of Series M Redeemable Preferred Stock pursuant to a dividend reinvestment plan. On February 7, 2025, we filed our prospectus for the offering with the SEC. Ashford Securities, a subsidiary of Ashford Inc., serves as the dealer manager for the offering. On December 9, 2025, the Company terminated the primary offering of the Company’s Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock. The Company continued to offer shares of its Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock pursuant to its dividend reinvestment plan beyond the termination of the primary offering As of March 18, 2026, the Company has issued approximately 243,000 shares (exclusive of the dividend reinvestment plan shares) of Series L Preferred Stock and received net proceeds of approximately $5.0 million and approximately 565,000 shares (exclusive of the dividend reinvestment plan shares) of Series M Preferred Stock and received net proceeds of approximately $12.6 million. On March 4, 2022, the Company filed an initial registration statement on Form S-3 with the SEC, as amended on April 29, 2022, related to the Company’s non-traded Series J Preferred Stock and Series K Preferred Stock. The registration statement was declared effective by the SEC on May 4, 2022, and contemplates the offering of up to (i) 20.0 million shares of Series J Preferred Stock or Series K Preferred Stock in a primary offering and (ii) 8.0 million shares of Series J Preferred Stock or Series K Preferred Stock pursuant to a dividend reinvestment plan. On May 5, 2022, we filed our prospectus for the offering with the SEC. On March 31, 2025, the Company concluded its offering of its Series J Preferred Stock and Series K Preferred Stock. Ashford Securities, a subsidiary of Ashford Inc., served as the dealer manager for the offering. As of March 18, 2026, the Company has issued approximately 7.7 million shares (exclusive of the dividend reinvestment plan shares) of Series J Preferred Stock and received net proceeds of approximately $172.6 million and approximately 799,000 shares (exclusive of the dividend reinvestment plan shares) of Series K Preferred Stock and received net proceeds of approximately $19.4 million. Sources and Uses of Cash Our principal sources of funds to meet our cash requirements include cash on hand, cash flow from operations, capital market activities, property refinancing proceeds and asset sales. Additionally, our principal uses of funds are expected to include possible operating shortfalls, owner-funded capital expenditures, dividends, new investments and debt interest and principal payments. Items that impacted our cash flow and liquidity during the periods indicated are summarized as follows: Net Cash Flows Provided by (Used in) Operating Activities. Net cash flows used in operating activities were $15.7 million and $23.6 million for the years ended December 31, 2025 and 2024, respectively. Cash flows used in operations were impacted by changes in hotel operations, our hotel dispositions and derecognized assets, as well as the timing of collecting receivables from hotel guests, paying vendors and settling with derivative counterparties, related parties and hotel managers. Net Cash Flows Provided by (Used in) Investing Activities. For the year ended December 31, 2025, net cash flows provided by investing activities were $190.8 million. Cash inflows consisted of $242.4 million of net proceeds from the disposition of assets and hotel properties, which included $235.2 million of net proceeds from the disposition of the five properties sold in 2025 and $7.2 million of net proceeds from the disposition of a land parcel previously owned by the Residence Inn Orlando property. Additional cash inflows included $18.8 million of net proceeds from the sale of state tax credits related to the Le Méridien Fort Worth and $734,000 from property insurance proceeds. Cash inflows were partially offset by cash outflows of $71.2 million for capital improvements made to various hotel properties. For the year ended December 31, 2024, net cash flows provided by investing activities were $191.3 million. Cash inflows consisted of $300.0 million of net proceeds from the disposition of assets and hotel properties, repayments from a note receivable of $2.5 million and $1.5 million from property insurance proceeds. Cash inflows were partially offset by cash outflows of $108.0 million for capital improvements made to various hotel properties and $4.5 million from the issuance of a note receivable. Net Cash Flows Provided by (Used in) Financing Activities. For the year ended December 31, 2025, net cash flows used in financing activities were $179.2 million. Cash outflows primarily consisted of $709.2 million for repayments of indebtedness, $50.3 million for payments of loan costs and exit fees, $5.1 million of payments for derivatives and $24.0 million 66
Page 69
of payments for preferred dividends. Cash outflows were partially offset by cash inflows from $560.4 million of borrowings on indebtedness, $39.7 million of net proceeds from preferred stock offerings, proceeds of $3.0 million from counterparties from in-the-money interest rate caps and $7.5 million of contributions from noncontrolling interests. For the year ended December 31, 2024, net cash flows used in financing activities were $258.8 million. Cash outflows primarily consisted of $388.3 million for repayments of indebtedness, $20.9 million for payments of loan costs and exit fees, $20.4 million of payments for preferred dividends, $16.3 million of payments for derivatives and $2.5 million of distributions to noncontrolling interests. Cash outflows were partially offset by cash inflows primarily of $63.8 million of borrowing on indebtedness, $84.8 million of net proceeds from preferred stock offerings, $27.8 million from counterparties from in-the-money interest rate caps, $8.8 million of net proceeds from common stock offerings and $4.9 million of contributions from noncontrolling interests. Dividend Policy. Distributions are authorized by our board of directors and declared by us based upon a variety of factors deemed relevant by our directors. The board of directors will continue to review our distribution policy on at least a quarterly basis. Our ability to pay distributions to our preferred or common stockholders will depend, in part, upon our receipt of distributions from our operating partnership. This, in turn, may depend upon receipt of lease payments with respect to our properties from indirect subsidiaries of our operating partnership, the management of our properties by our hotel managers and general business conditions. Distributions to our stockholders are generally taxable to our stockholders as ordinary income. However, since a portion of our investments are equity ownership interests in hotels, which result in depreciation and non-cash charges against our income, a portion of our distributions may constitute a non-taxable return of capital, to the extent of a stockholder’s tax basis in the stock. To the extent that it is consistent with maintaining our REIT status, we may maintain accumulated earnings of Ashford TRS in that entity. On December 15, 2025, our board of directors reviewed and approved our 2026 dividend policy. We do not anticipate paying any dividends on our outstanding common stock for any quarter during 2026. Further, to preserve the Company’s liquidity position as it evaluates strategic alternatives, preferred dividends have been suspended, including dividends previously declared for recordholders of the Company’s Series D, F, G, H, I, J, K, L and M preferred stock as of December 31, 2025, and payable on January 15, 2026. We intend to pay the previously declared but unpaid dividends as soon as reasonably practicable. Any accrued but unpaid dividends will accrue in accordance with the terms outlined in the applicable governing documents for each series of preferred stock. We will continue to evaluate potential future dividends on a quarterly basis. Declaration of dividends in 2026 on our preferred stock may require a determination by our board of directors, at the time of any determination, that the Company would continue to have positive equity on a fair value basis, among other considerations. Our board of directors will continue to review our dividend policy and make future announcements with respect thereto. We may incur indebtedness to meet distribution requirements imposed on REITs under the Code to the extent that working capital and cash flow from our investments are insufficient to fund required distributions. INFLATION We rely entirely on the performance of our hotel properties and the ability of the hotel properties’ managers to increase revenues to keep pace with inflation. Hotel operators can generally increase room rates, but competitive pressures may limit their ability to raise rates faster than inflation. Our general and administrative costs, real estate and personal property taxes, property and casualty insurance, labor costs and utilities are subject to inflation as well. CRITICAL ACCOUNTING POLICIES AND ESTIMATES Our significant accounting policies are fully described in note 2 to our consolidated financial statements included in Item 8. Financial Statements and Supplementary Data. We believe that the following discussion addresses our most critical accounting estimates, representing those policies considered most vital to the portrayal of our financial condition and results of operations and require management’s most difficult, subjective, complex judgments and can include significant estimates. Impairment of Investments in Hotel Properties—Hotel properties are reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. Recoverability of the hotel is measured by comparison of the carrying amount of the hotel to the estimated future undiscounted cash flows, which take into account current market conditions and our intent with respect to holding or disposing of the hotel. If our analysis indicates that the carrying value of the hotel is not recoverable on an undiscounted cash flow basis, we recognize an impairment charge for the amount by which the property’s net book value exceeds its estimated fair value, or fair value, less cost to sell. In evaluating impairment of hotel properties, we make many assumptions and estimates, including projected cash flows, expected holding period, and expected useful life. Fair value is determined through various valuation techniques, including internally developed discounted cash flow models, comparable market transactions and third-party appraisals, where considered necessary. We 67
Page 70
recorded $67.6 million and $59.3 million of impairment charges for the years ended December 31, 2025 and 2024, respectively. No impairment charge was recorded for the year ended December 31, 2023. See note 5 to our consolidated financial statements. Income Taxes—As a REIT, we generally are not subject to federal corporate income tax on the portion of our net income (loss) that does not relate to taxable REIT subsidiaries. However, Ashford TRS is treated as a taxable REIT subsidiary for U.S. federal income tax purposes. In accordance with authoritative accounting guidance, we account for income taxes related to Ashford TRS using the asset and liability method under which deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. In addition, the analysis utilized by us in determining our deferred tax asset valuation allowance involves considerable management judgment and assumptions. See note 20 to our consolidated financial statements. At December 31, 2025 and 2024, we recorded a valuation allowance of $45.9 million and $37.6 million, respectively on the net deferred tax assets of our taxable REIT subsidiaries. At each reporting date, we evaluate whether it is more likely than not that we will utilize all or a portion of our deferred tax assets. We consider all available positive and negative evidence, including historical results of operations, projected future taxable income, carryback potential and scheduled reversals of deferred tax liabilities. At December 31, 2025, we had TRS NOLs for U.S. federal income tax purposes of $174.2 million, however $82.5 million of our NOLs are subject to limitation in the amount of approximately $1.2 million per year under Section 382 of the Internal Revenue Code. NOLs become subject to an annual limitation in the event of certain cumulative changes in the ownership of significant shareholders over a three- year period in excess of 50%, as defined under Section 382 of the Internal Revenue Code. The remaining $91.7 million of our TRS federal NOLs are not subject to the limitations of Section 382. In total $1.9 million of our TRS federal NOLs are subject to expiration and will begin to expire in 2026. The remainder were generated after December 31, 2017 and are not subject to expiration under the Tax Cuts and Jobs Act. At December 31, 2025, we had state net operating loss carryforwards of $1.1 billion which begin to expire in 2027. The Company also has indefinite-lived state NOLs. At December 31, 2025, we had REIT NOLs for U.S. federal income tax purposes of $1.4 billion based on the latest filed tax returns. The majority of our REIT NOLs are subject to limitation on their use under Section 382. $424.0 million of our net operating loss carryforwards will begin to expire in 2029 and are available to offset future taxable income, if any, through 2036. The remainder were generated after December 31, 2017 and are not subject to expiration under the Tax Cuts and Jobs Act. The “Income Taxes” topic of the ASC issued by the Financial Accounting Standards Board (“FASB”) which addresses the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. The guidance requires us to determine whether tax positions we have taken or expect to take in a tax return are more likely than not to be sustained upon examination by the appropriate taxing authority based on the technical merits of the positions. Tax positions that do not meet the more likely than not threshold would be recorded as additional tax expense in the current period. We analyze all open tax years, as defined by the statute of limitations for each jurisdiction, which includes the federal jurisdiction and various states. We classify interest and penalties related to underpayment of income taxes as income tax expense. We and our subsidiaries file income tax returns in the U.S. federal jurisdiction and various states and cities. Tax years 2021 through 2025 remain subject to potential examination by certain federal and state taxing authorities. RECENTLY ADOPTED ACCOUNTING STANDARDS In December 2023, the FASB issued ASU 2023-09 Income Taxes (Topics 740): Improvements to Income Tax Disclosures to expand the disclosure requirements for income taxes, specifically related to the rate reconciliation and income taxes paid. ASU 2023-09 is effective for our annual periods beginning January 1, 2025. The amendments in this ASU may be applied prospectively by providing the revised disclosures for the period ending December 31, 2025 and continuing to provide the pre-ASU disclosures for the prior periods, or the amendments may be applied retrospectively by providing the revised disclosures for all periods presented. As of December 31, 2025, the Company has prospectively adopted this ASU. The adoption of this ASU only impacted disclosures with respect to the Company’s consolidated financial statements. RECENTLY ISSUED ACCOUNTING STANDARDS In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40) Disaggregation of Income Statement Expenses that requires more detailed information about specified categories of expenses (purchases of inventory, employee compensation, depreciation, amortization, and depletion) included in certain expense captions presented on the face of the statement of operations. In January 2025, the FASB issued ASU 2025-01 which amends the effective date of the new disaggregation of income statement expenses standard to clarify that all public business entities are required to adopt the guidance in annual reporting periods beginning after Dec. 15, 2026, and interim periods within annual reporting periods beginning after Dec. 15, 2027. Early 68
Page 71
adoption is still permitted. The amendments may be applied either (1) prospectively to financial statements issued for reporting periods after the effective date of this ASU or (2) retrospectively to all prior periods presented in the financial statements. We are currently evaluating the impact this ASU will have on our disclosures. NON-GAAP FINANCIAL MEASURES The following non-GAAP presentations of EBITDA, EBITDAre, Adjusted EBITDAre, FFO and Adjusted FFO are presented to help our investors evaluate our operating performance. EBITDA is defined as net income (loss) before interest expense and amortization of discounts and loan costs, net, income taxes, depreciation and amortization, as adjusted to reflect only the Company’s portion of EBITDA of unconsolidated entities. In addition, we exclude impairment on real estate, gain/loss on consolidation of VIE and disposition of assets and hotel properties, gain/loss on derecognition of assets and gain/loss of unconsolidated entities to calculate EBITDAre, as defined by NAREIT. We then further adjust EBITDAre to exclude certain additional items such as write-off of premiums, loan costs and exit fees, other income/expense, net, transaction and conversion costs, stock/unit-based compensation and non-cash items, such as amortization of unfavorable contract liabilities, realized and unrealized gains/losses on derivative instruments, gains/losses on extinguishment of debt, severance, as well as our portion of adjustments to EBITDAre of unconsolidated entities. We present EBITDA, EBITDAre and Adjusted EBITDAre because we believe they are useful to an investor in evaluating our operating performance because it provides investors with an indication of our ability to incur and service debt, to satisfy general operating expenses, to make capital expenditures and to fund other cash needs or reinvest cash into our business. We also believe it helps investors meaningfully evaluate and compare the results of our operations from period to period by removing the effect of our asset base (primarily depreciation and amortization) from our operating results. Our management team also uses EBITDA as one measure in determining the value of acquisitions and dispositions. EBITDA, EBITDAre and Adjusted EBITDAre as calculated by us may not be comparable to EBITDA, EBITDAre and Adjusted EBITDAre reported by other companies that do not define EBITDA, EBITDAre and Adjusted EBITDAre exactly as we define the terms. EBITDA, EBITDAre and Adjusted EBITDAre do not represent cash generated from operating activities determined in accordance with GAAP, and should not be considered as an alternative to operating income (loss) or net income (loss) determined in accordance with GAAP as an indicator of performance or as an alternative to cash flows from operating activities as determined by GAAP as an indicator of liquidity. 69
Page 72
The following table reconciles net income (loss) to EBITDA, EBITDAre and Adjusted EBITDAre (in thousands): Year Ended December 31, 2025 2024 2023 Net income (loss) $ (188,159) $ (65,011) $ (180,734) Interest expense and amortization of discounts and loan costs 256,229 273,359 326,970 Interest expense associated with hotels in receivership 39,038 45,592 39,178 Depreciation and amortization 141,295 152,776 187,807 Income tax expense (benefit) (143) 997 900 Equity in (earnings) loss of unconsolidated entities 325 2,370 1,134 Company’s portion of EBITDA of unconsolidated entities 1,208 436 231 EBITDA 249,793 410,519 375,486 Impairment charges on real estate 67,648 59,331 — (Gain) loss on consolidation of VIE and disposition of assets and hotel properties (79,799) (94,406) (11,488) (Gain) loss on derecognition of assets (39,054) (167,177) — EBITDAre 198,588 208,267 363,998 Amortization of unfavorable contract liabilities (122) (122) (15) Transaction and conversion costs 9,549 10,809 3,856 Write-off of premiums, loan costs and exit fees 8,853 5,245 3,469 Realized and unrealized (gain) loss on derivatives 5,346 6,480 2,200 Stock/unit-based compensation (760) 2,097 4,027 Legal, advisory and settlement costs 1,871 3,230 1,181 Other (income) expense, net — (108) (310) (Gain) loss on insurance settlements (2,950) (73) (505) (Gain) loss on extinguishment of debt (335) (2,774) (53,386) Severance 1,228 2,824 — Company’s portion of adjustments to EBITDAre of unconsolidated entities — 6 2 Adjusted EBITDAre $ 221,268 $ 235,881 $ 324,517 70
Page 73
We calculate FFO and Adjusted FFO in the following table. FFO is calculated on the basis defined by NAREIT, which is net income(loss) attributable to common stockholders, computed in accordance with GAAP, excluding gains or losses on consolidation of VIE and disposition of assets and hotel properties, plus depreciation and amortization of real estate assets, impairment charges on real estate assets,and after adjustments for unconsolidated entities and noncontrolling interests in the operating partnership. Adjustments for unconsolidatedentities are calculated to reflect FFO on the same basis. NAREIT developed FFO as a relative measure of performance of an equity REIT torecognize that income-producing real estate historically has not depreciated on the basis determined by GAAP. Our calculation of Adjusted FFO excludes write-off of premiums, loan costs and exit fees, other income/expense, net, transaction and conversion costs, legal, advisoryand settlement costs, stock/unit-based compensation, gains/losses on insurance settlements and non-cash items such as deemed dividends onredeemable preferred stock, amortization of loan costs, amortization of credit facility exit fees, default interest and late fees, unrealizedgains/losses on derivative instruments, gains/losses on extinguishment of debt and preferred stock, severance, and interest expense associated with hotels in receivership and our portion of adjustments to FFO related to unconsolidated entities. We exclude items fromAdjusted FFO that are either non-cash or are not part of our core operations in order to provide a period-over-period comparison of ouroperating results. We present FFO and Adjusted FFO because we consider FFO and Adjusted FFO important supplemental measures of ouroperational performance and believe they are frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO and Adjusted FFO when reporting their results. FFO and Adjusted FFO are intended to excludeGAAP historical cost depreciation and amortization, which assumes that the value of real estate assets diminishes ratably over time.Historically, however, real estate values have risen or fallen with market conditions. Because FFO and Adjusted FFO exclude depreciation and amortization related to real estate assets, gains and losses from real property dispositions and impairment losses on real estate assets,FFO and Adjusted FFO provide performance measures that, when compared year over year, reflect the effect to operations from trends inoccupancy, guestroom rates, operating costs, development activities and interest costs, providing perspective not immediately apparent fromnet income. We consider FFO and Adjusted FFO to be appropriate measures of our ongoing normalized operating performance as a REIT. We compute FFO in accordance with our interpretation of standards established by NAREIT, which may not be comparable to FFO reportedby other REITs that either do not define the term in accordance with the current NAREIT definition or interpret the NAREIT definitiondifferently than we do. FFO and Adjusted FFO do not represent cash generated from operating activities as determined by GAAP andshould not be considered as an alternative to (a) GAAP net income or loss as an indication of our financial performance or (b) GAAP cash flows from operating activities as a measure of our liquidity, nor is it indicative of funds available to satisfy our cash needs, including ourability to make cash distributions. However, to facilitate a clear understanding of our historical operating results, we believe that FFO andAdjusted FFO should be considered along with our net income or loss and cash flows reported in the consolidated financial statements. 71
Page 74
The following table reconciles net income (loss) to FFO and Adjusted FFO (in thousands): Year Ended December 31, 2025 2024 2023 Net income (loss) $ (188,159) $ (65,011) $ (180,734) (Income) loss attributable to noncontrolling interest in consolidated entities 5,058 4,028 6 Net (income) loss attributable to redeemable noncontrolling interests in operating partnership 3,262 683 2,239 Preferred dividends (28,216) (22,686) (15,921) Deemed dividends on redeemable preferred stock (6,949) (2,906) (2,673) Gain (loss) on extinguishment of preferred stock — 3,370 3,390 Net income (loss) attributable to common stockholders (215,004) (82,522) (193,693) Depreciation and amortization of real estate 138,441 152,776 187,807 (Gain) loss on consolidation of VIE and disposition of assets and hotel properties (79,799) (94,406) (11,488) (Gain) loss on derecognition of assets (39,054) (167,177) — Net income (loss) attributable to redeemable noncontrolling interests in operating partnership (3,262) (683) (2,239) Equity in (earnings) loss of unconsolidated entities 325 2,370 1,134 Impairment charges on real estate 67,648 59,331 — Company’s portion of FFO of unconsolidated entities 192 (932) (668) FFO available to common stockholders and OP unitholders (130,513) (131,243) (19,147) Deemed dividends on redeemable preferred stock 6,949 2,906 2,673 (Gain) loss on extinguishment of preferred stock — (3,370) (3,390) Transaction and conversion costs 9,549 10,809 3,856 Write-off of premiums, loan costs and exit fees 8,853 5,245 3,469 Unrealized (gain) loss on derivatives 7,064 32,790 44,041 Stock/unit-based compensation (760) 2,097 4,027 Legal, advisory and settlement costs 1,871 3,230 1,181 Other (income) expense, net — (108) (310) Amortization of term loan exit fee — 844 18,616 Amortization of loan costs 25,490 13,591 12,735 (Gain) loss on insurance settlements (2,950) (73) (505) (Gain) loss on extinguishment of debt (335) (2,774) (53,386) Interest expense associated with hotels in receivership 39,038 40,045 — Severance 1,228 2,824 — Default interest and late fees — — 12,553 Company’s portion of adjustments to FFO of unconsolidated entities 105 125 2 Adjusted FFO available to common stockholders and OP unitholders $ (34,411) $ (23,062) $ 26,415 72
Page 75
Item 7A. Quantitative and Qualitative Disclosures About Market Risk Our primary market risk exposure consists of changes in interest rates on borrowings under our debt instruments. The analysis below presents the sensitivity of the market value of our financial instruments to selected changes in market interest rates. As of December 31, 2025, our total indebtedness of $2.6 billion included $2.4 billion of variable-rate debt. The impact on our results of operations of a 25-basis point change in interest rate on the outstanding balance of variable-rate debt at December 31, 2025, would be approximately $6.1 million per year. However, we currently have various interest rate caps in place that limit this exposure. Interest rate changes have no impact on the remaining $156.7 million of fixed-rate debt. The above amounts were determined based on the impact of hypothetical interest rates on our borrowings and assume no changes in our capital structure. As the information presented above includes only those exposures that existed as of December 31, 2025, it does not consider exposures or positions that could arise after that date. Accordingly, the information presented herein has limited predictive value. As a result, the ultimate realized gain or loss with respect to interest rate fluctuations will depend on exposures that arise during the period, the hedging strategies in place at the time, and the related interest rates. 73
Page 76
Item 8. Financial Statements and Supplementary Data Index to Consolidated Financial Statements Report of Independent Registered Public Accounting Firm (BDO USA, P.C.; Dallas, Texas; PCAOB ID #243) 75 Consolidated Balance Sheets — December 31, 2025 and 2024 77 Consolidated Statements of Operations — Years Ended December 31, 2025, 2024 and 2023 78 Consolidated Statements of Comprehensive Income (Loss) — Years Ended December 31, 2025, 2024 and 2023 79 Consolidated Statements of Equity — Years Ended December 31, 2025, 2024 and 2023 80 Consolidated Statements of Cash Flows — Years Ended December 31, 2025, 2024 and 2023 85 Notes to Consolidated Financial Statements 87 74
Page 77
Report of Independent Registered Public Accounting Firm Stockholders and Board of Directors Ashford Hospitality Trust, Inc. Dallas, Texas Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of Ashford Hospitality Trust, Inc. (the “Company”) as of December 31, 2025 and 2024, the related consolidated statements of operations, comprehensive income (loss), equity (deficit), and cash flows for each of the three years in the period ended December 31, 2025, and the related notes and financial statement schedule listed in the index at Item 15(a) (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in theUnited States of America. Going Concern Uncertainty The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the Company has final debt maturities within one year from the date the financial statements are issued, which raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit toobtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matters The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material tothe consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of the critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Revenue Recognition of Hotel Rooms Revenue As described in Note 3 to the consolidated financial statements, during the year ended December 31, 2025, the Company recognized approximately $826 million of hotel rooms revenue. Hotel rooms revenue is recognized as services are provided over the course of the hotel stay. 75
Page 78
We identified the auditing of the recognition of hotel rooms revenue as a critical audit matter. Auditing hotel rooms revenue was especially challenging due to the large volume of transactions and the nature and extent of audit effort required to address this matter. The primary procedures we performed to address this critical audit matter included the following: • Testing the operating effectiveness of internal controls over the Company’s revenue recognition. • Testing the existence and accuracy of the revenue recognized by selecting a sample of individual rooms revenue transactions, and (i) obtaining detailed transaction data, (ii) testing the existence and accuracy of amounts recognized by agreeing each transaction to the corresponding customer folio, and (iii) corroborating the existence and accuracy of the amounts recognized by agreeing to thecustomer payment support. Measurement of Impairment of the Hilton Santa Cruz Scotts Valley As of December 31, 2025, the Company’s consolidated investments in hotel properties, net, totaled approximately $2.1 billion. As described in Notes 2 and 5 to the consolidated financial statements, the hotel properties are reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. Recoverability of a hotel property is measured by comparison of the carrying amount of the hotel to its estimated future undiscounted cash flows. If the Company’s analysis indicates that the carrying value of the hotel is not recoverable on an undiscounted cash flow basis, the Company recognizes an impairment charge for the amount by which the property’s net book value exceeds its estimated fair value. For the year ended December 31, 2025, the Company recorded impairment charges of approximately $67.6 million, including $16.3 million for the Hilton Santa Cruz Scotts Valley. We identified the estimated fair value based on the income approach which was used to measure the impairment charge for the Hilton Santa Cruz Scotts Valley as a critical audit matter. For the Hilton Santa Cruz Scotts Valley, an increased level of management judgment was required in the determination of certain assumptions used to estimate the fair value of the hotel, including forecasted rooms revenue, discount rates and terminal capitalization rates utilized in the income approach. Auditing these judgments was especially challenging due to the nature and extent of audit effort required, including the use of personnel with specialized skill or knowledge. The primary procedures we performed to address the critical audit matter utilized valuation professionals with specialized skill or knowledge, who assisted in: • Evaluating the rooms revenue assumptions utilized in developing the fair value estimate for the Hilton Santa Cruz Scotts Valley by comparing to independent market data. • Evaluating the discount and terminal capitalization rates utilized in developing the fair value estimate for the Hilton Santa Cruz Scotts Valley by comparing to independent market data. Preferred Equity Instrument As described in Notes 2 and 7 to the consolidated financial statements, the Company received $88.0 million in return for a preferred equity investment in the Renaissance Hotel in Nashville, Tennessee. The preferred equity instrument is mandatorily redeemable and recorded within indebtedness, net in the consolidated financial statements. We identified the evaluation of the conditions to determine the classification and initial recognition of the preferred equity instrument as a critical audit matter. Auditing the classification and initial recognition based on the terms of the preferred equity agreement was especially challenging due to the inherent complexities of the agreement and the relevant accounting guidance. Auditing these elements required an increased level of audit effort, including the involvement of professionals with specialized skill and knowledge in the relevant technical accounting. The primary procedures we performed to address the critical audit matter included the following: • Inspecting the underlying preferred equity agreement to understand the relevant terms. • Utilizing personnel with expertise in the relevant technical accounting literature to assist in evaluating the classification and initial recognition of the preferred equity instrument. /s/ BDO USA, P.C. We have served as the Company’s auditor since 2015. Dallas, Texas March 20, 2026 76
Page 79
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands, except share and per share amounts) December 31, 2025 December 31, 2024 ASSETS Investments in hotel properties, gross ($82,787 and $159,378 attributable to VIEs) $ 3,069,016 $ 3,350,086 Accumulated depreciation ($(5,558) and $(30,365) attributable to VIEs) (983,772) (1,030,879) Investments in hotel properties, net ($77,229 and $129,012 attributable to VIEs) 2,085,244 2,319,207 Contract asset 355,138 366,671 Cash and cash equivalents ($468 and $7,286 attributable to VIEs) 66,145 112,907 Restricted cash ($4,731 and $3,430 attributable to VIEs) 149,580 99,695 Accounts receivable ($143 and $614 attributable to VIEs), net of allowance of $424 and $435, respectively 32,752 35,579 Inventories ($44 and $57 attributable to VIEs) 3,598 3,631 Notes receivable, net 12,187 10,565 Investments in unconsolidated entities 7,265 7,590 Deferred costs, net ($80 and $181 attributable to VIEs) 1,529 1,788 Derivative assets 410 2,594 Operating lease right-of-use assets 43,582 43,780 Prepaid expenses and other assets ($40 and $3,090 attributable to VIEs) 32,057 39,144 Due from third-party hotel managers 25,667 21,206 Assets held for sale 18,478 96,628 Total assets $ 2,833,632 $ 3,160,985 LIABILITIES AND EQUITY/DEFICIT Liabilities: Indebtedness, net ($15,961 and $65,548 attributable to VIEs) $ 2,526,608 $ 2,629,289 Debt associated with hotels in receivership 272,800 314,640 Finance lease liability 17,536 17,992 Accounts payable and accrued expenses ($15,534 and $19,963 attributable to VIEs) 123,773 137,506 Accrued interest payable ($152 and $230 attributable to VIEs) 13,993 10,212 Accrued interest associated with hotels in receivership 82,338 52,031 Dividends and distributions payable ($0 and $1 attributable to VIEs) 4,247 3,952 Due to Ashford Inc., net ($0 and $5,997 attributable to VIEs) 40,643 25,635 Due to related parties, net ($3,438 and $113 attributable to VIEs) 1,949 2,850 Due to third-party hotel managers ($0 and $22 attributable to VIEs) 882 1,145 Operating lease liabilities 44,045 44,369 Other liabilities ($28,897 and $28,784 attributable to VIEs) 36,768 34,011 Liabilities related to assets held for sale 41,292 99,139 Total liabilities 3,206,874 3,372,771 Commitments and contingencies (note 18) Redeemable noncontrolling interests in operating partnership 20,516 22,509 Series J Redeemable Preferred Stock, $0.01 par value, 7,684,201 and 6,799,638 shares issued and outstanding at December 31, 2025 andDecember 31, 2024, respectively 179,818 156,671 Series K Redeemable Preferred Stock, $0.01 par value, 731,102 and 601,175 shares issued and outstanding at December 31, 2025 andDecember 31, 2024, respectively 18,215 14,869 Series L Redeemable Preferred Stock, $0.01 par value, 238,191 shares issued and outstanding at December 31, 2025 5,484 — Series M Redeemable Preferred Stock, $0.01 par value, 550,888 shares issued and outstanding at December 31, 2025 13,566 — Equity (deficit): Preferred stock, $0.01 par value, 55,000,000 shares authorized: Series D Cumulative Preferred Stock, 1,111,127 shares issued and outstanding at December 31, 2025 and December 31, 2024 11 11 Series F Cumulative Preferred Stock, 1,037,044 shares issued and outstanding at December 31, 2025 and December 31, 2024 10 10 Series G Cumulative Preferred Stock, 1,470,948 shares issued and outstanding at December 31, 2025 and December 31, 2024 15 15 Series H Cumulative Preferred Stock, 1,037,956 shares issued and outstanding at December 31, 2025 and December 31, 2024 10 10 Series I Cumulative Preferred Stock, 1,034,303 shares issued and outstanding at December 31, 2025 and December 31, 2024 11 11 Common stock, $0.01 par value, 395,000,000 shares authorized, 6,476,157 and 5,636,595 shares issued and outstanding at December 31, 2025and December 31, 2024, respectively 65 56 Additional paid-in capital 2,402,015 2,392,518 Accumulated deficit (3,028,489) (2,811,868) Total stockholders’ equity (deficit) of the Company (626,352) (419,237) Noncontrolling interest in consolidated entities 15,511 13,402 Total equity (deficit) (610,841) (405,835) Total liabilities and equity/deficit $ 2,833,632 $ 3,160,985 See Notes to Consolidated Financial Statements. 77
Page 80
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) Year Ended December 31, 2025 2024 2023 REVENUE Rooms $ 825,623 $ 889,753 $ 1,059,155 Food and beverage 207,588 212,581 232,829 Other hotel revenue 69,643 67,800 72,748 Total hotel revenue 1,102,854 1,170,134 1,364,732 Other 1,534 2,325 2,801 Total revenue 1,104,388 1,172,459 1,367,533 EXPENSES Hotel operating expenses: Rooms 198,106 209,569 249,434 Food and beverage 139,828 145,304 161,300 Other expenses 392,070 418,077 464,058 Management fees 38,264 42,406 50,645 Total hotel expenses 768,268 815,356 925,437 Property taxes, insurance and other 59,793 64,103 70,226 Depreciation and amortization 141,295 152,776 187,807 Impairment charges 67,648 59,331 — Advisory services fee 49,039 58,606 48,927 Corporate, general and administrative 20,783 24,662 16,181 Total operating expenses 1,106,826 1,174,834 1,248,578 Gain (loss) on consolidation of VIE and disposition of assets and hotel properties 79,799 94,406 11,488 Gain (loss) on derecognition of assets 39,054 167,177 — OPERATING INCOME (LOSS) 116,415 259,208 130,443 Equity in earnings (loss) of unconsolidated entities (325) (2,370) (1,134) Interest income 4,739 6,942 8,978 Other income (expense) — 108 310 Interest expense and amortization of discounts and loan costs (256,229) (273,359) (326,970) Interest expense associated with hotels in receivership (39,038) (45,592) (39,178) Write-off of premiums, loan costs and exit fees (8,853) (5,245) (3,469) Gain (loss) on extinguishment of debt 335 2,774 53,386 Realized and unrealized gain (loss) on derivatives (5,346) (6,480) (2,200) INCOME (LOSS) BEFORE INCOME TAXES (188,302) (64,014) (179,834) Income tax (expense) benefit 143 (997) (900) NET INCOME (LOSS) (188,159) (65,011) (180,734) (Income) loss attributable to noncontrolling interest in consolidated entities 5,058 4,028 6 Net (income) loss attributable to redeemable noncontrolling interests in operating partnership 3,262 683 2,239 NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY (179,839) (60,300) (178,489) Preferred dividends (28,216) (22,686) (15,921) Deemed dividends on redeemable preferred stock (6,949) (2,906) (2,673) Gain (loss) on extinguishment of preferred stock — 3,370 3,390 NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS $ (215,004) $ (82,522) $ (193,693) INCOME (LOSS) PER SHARE - BASIC AND DILUTED Basic: Net income (loss) attributable to common stockholders $ (35.99) $ (17.54) $ (56.11) Weighted average common shares outstanding – basic 5,974 4,706 3,452 Diluted: Net income (loss) attributable to common stockholders $ (35.99) $ (17.54) $ (56.11) Weighted average common shares outstanding – diluted 5,974 4,706 3,452 See Notes to Consolidated Financial Statements. 78
Page 81
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (in thousands) Year Ended December 31, 2025 2024 2023 Net income (loss) $ (188,159) $ (65,011) $ (180,734) Other comprehensive income (loss), net of tax: Total other comprehensive income (loss) — — — Comprehensive income (loss) (188,159) (65,011) (180,734) Less: Comprehensive (income) loss attributable to noncontrolling interest in consolidated entities 5,058 4,028 6 Less: Comprehensive (income) loss attributable to redeemable noncontrolling interests in operating partnership 3,262 683 2,239 Comprehensive income (loss) attributable to the Company $ (179,839) $ (60,300) $ (178,489) See Notes to Consolidated Financial Statements. 79
Page 82
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EQUITY (DEFICIT) (in thousands, except per share amounts)
Page 83
Preferred Stock Series D Series F Series G Series H Series I Common Stock Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount AdditionalPaid-inCapital AccumulatedDeficit NoncontrollingInterest inConsolidatedEntities Total Balance atDecember 31, 2022 1,174 $ 12 1,251 $ 12 1,532 $ 15 1,308 $ 13 1,253 $ 13 3,450 $ 34 $2,383,555 $(2,534,043) $ — $(150,389) Purchases ofcommon stock — — — — — — — — — — (3) — (83) — — (83) Equity-basedcompensation — — — — — — — — — — — — 2,319 — — 2,319 Issuance ofrestrictedshares/units — — — — — — — — — — 12 1 (1) — — — Issuance ofcommon stock — — — — — — — — — — 72 — 911 — — 911 Issuance ofpreferred shares — — — — — — — — — — — — — — — — Dividends declared– preferred stock –Series D($2.11/share) — — — — — — — — — — — — — (2,472) — (2,472) Dividends declared– preferred stock –Series F($1.84/share) — — — — — — — — — — — — — (2,272) — (2,272) Dividends declared– preferred stock –Series G($1.84/share — — — — — — — — — — — — — (2,824) — (2,824) Dividends declared– preferred stock –Series H($1.88/share) — — — — — — — — — — — — — (2,389) — (2,389) Dividends declared– preferred stock –Series I($1.88/share) — — — — — — — — — — — — — (2,306) — (2,306) Dividends declared– preferred stock –Series J($2.00/share) — — — — — — — — — — — — — (3,467) — (3,467) Dividends declared– preferred stock –Series K($2.05/share) — — — — — — — — — — — — — (191) — (191) Redemption valueadjustment — — — — — — — — — — — — — (1,576) — (1,576) Redemption valueadjustment -preferred stock — — — — — — — — — — — — — (2,673) — (2,673) Redemption ofpreferred stock — — — — — — — — — — — — — — — — Contributions fromnoncontrollinginterests inconsolidated entities — — — — — — — — — — — — — — 6,905 6,905 Extinguishment ofpreferred stock (14) — (76) (1) — — (138) (1) (92) (1) 211 2 (3,389) 3,390 — Noncontrollinginterest inconsolidated entitiesrecognized uponconsolidation ofVIE — — — — — — — — — — — — — — 7,961 7,961 Distributions tononcontrollinginterests — — — — — — — — — — — — — — (1) (1) Net income (loss) — — — — — — — — — — — — — (178,489) (6) (178,495) Balance at December31, 2023 1,160 $ 12 1,175 $ 11 1,532 $ 15 1,170 $ 12 1,161 $ 12 3,742 $ 37 $2,383,312 $(2,729,312) $ 14,859 $(331,042) Purchases ofcommon stock — — — — — — — — — — (3) — (49) — — (49) Equity-basedcompensation — — — — — — — — — — — — 854 — 92 946 Issuance ofrestrictedshares/units — — — — — — — — — — 56 1 (1) — — — Issuance ofcommon stock — — — — — — — — — — 741 7 8,884 — — 8,891 Issuance ofpreferred shares — — — — — — — — — — — — — — — — Dividends declared– preferred stock –Series D($2.11/share) — — — — — — — — — — — — — (2,397) — (2,397) Dividends declared– preferred stock –Series F($1.84/share) — — — — — — — — — — — — — (1,970) — (1,970) Dividends declared– preferred stock –Series G($1.84/share) — — — — — — — — — — — — — (2,756) — (2,756) 80
Page 86
Preferred Stock Series D Series F Series G Series H Series I Common Stock Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount AdditionalPaid-inCapital AccumulatedDeficit NoncontrollingInterest inConsolidatedEntities Total Dividends declared– preferred stock –Series H($1.88/share) — — — — — — — — — — — — — (2,001) — (2,001) Dividends declared– preferred stock –Series I($1.88/share) — — — — — — — — — — — — — (2,023) — (2,023) Dividends declared– preferred stock –Series J($2.00/share) — — — — — — — — — — — — — (10,711) — (10,711) Dividends declared– preferred stock –Series K($2.06/share) — — — — — — — — — — — — — (828) — (828) Dividends declared- Stirling OP — — — — — — — — — — — — — — (15) (15) Issuances of StirlingOP common units — — — — — — — — — — — — — — 140 140 Redemption valueadjustment — — — — — — — — — — — — — (34) — (34) Redemption valueadjustment –preferred stock — — — — — — — — — — — — — (2,906) — (2,906) Redemption ofpreferred stock — — — — — — — — — — 326 3 2,891 — — 2,894 Contributions fromnoncontrollinginterests inconsolidated entities — — — — — — — — — — — — — — 4,866 4,866 Extinguishment ofpreferred stock (49) (1) (138) (1) (61) — (132) (2) (127) (1) 775 8 (3,373) 3,370 — — Distributions tononcontrollinginterests — — — — — — — — — — — — — — (2,512) (2,512) Net income (loss) — — — — — — — — — — — — — (60,300) (4,028) (64,328) Balance at December31, 2024 1,111 $ 11 1,037 $ 10 1,471 $ 15 1,038 $ 10 1,034 $ 11 5,637 $ 56 $2,392,518 $(2,811,868) $ 13,402 $(405,835) Purchases ofcommon stock — — — — — — — — — — (8) — (44) — — (44) Equity-basedcompensation — — — — — — — — — — — — (426) — 13 (413) Issuance ofcommon stock — — — — — — — — — — 3 — — — — — Issuances ofpreferred shares — — — — — — — — — — — — — — — — Costs for issuancesof common shares — — — — — — — — — — — — (131) — — (131) Dividends declared– preferred stock –Series D($2.11/share) — — — — — — — — — — — — — (2,347) — (2,347) Dividends declared– preferred stock –Series F($1.84/share) — — — — — — — — — — — — — (1,912) — (1,912) Dividends declared– preferred stock –Series G($1.84/share) — — — — — — — — — — — — — (2,712) — (2,712) Dividends declared– preferred stock –Series H($1.88/share) — — — — — — — — — — — — — (1,946) — (1,946) Dividends declared– preferred stock –Series I($1.88/share) — — — — — — — — — — — — — (1,939) — (1,939) Dividends declared– preferred stock –Series J($2.00/share) — — — — — — — — — — — — — (15,178) — (15,178) Dividends declared– preferred stock –Series K($2.07/share) — — — — — — — — — — — — — (1,503) — (1,503) Dividends declared- preferred stock -Series L($1.41/share) — — — — — — — — — — — — — (216) — (216) Dividends declared- preferred stock -Series M($1.44/share) — — — — — — — — — — — — — (463) — (463) Dividends declared- Stirling OP — — — — — — — — — — — — — — (12) (12) Issuances of StirlingOP common units — — — — — — — — — — — — — — 56 56 Redemption ofStirling OP commonunits — — — — — — — — — — — — (281) — (404) (685) Redemption valueadjustment — — — — — — — — — — — — — (1,617) — (1,617) Redemption valueadjustment - f d t k (6949) (6949)
Page 87
preferred stock — — — — — — — — — — — — — (6,949) — (6,949) 81
Page 88
Preferred Stock Series D Series F Series G Series H Series I Common Stock Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount AdditionalPaid-inCapital AccumulatedDeficit NoncontrollingInterest inConsolidatedEntities Total Redemption ofpreferred stock — — — — — — — — — — 844 9 5,076 — — 5,085 Contributions fromnoncontrollinginterests inconsolidatedentities — — — — — — — — — — — — — — 7,514 7,514 Contribution fromStirling Advisor — — — — — — — — — — — — 5,303 — — 5,303 Net income (loss) — — — — — — — — — — — — — (179,839) (5,058) (184,897) Balance at December31, 2025 1,111 $ 11 1,037 $ 10 1,471 $ 15 1,038 $ 10 1,034 $ 11 6,476 $ 65 $2,402,015 $(3,028,489) $ 15,511 $(610,841) 82
Page 89
Preferred Stock Series J Series K Series L Series M Shares Amount Shares Amount Shares Amount Shares Amount RedeemableNoncontrollingInterest inOperatingPartnership Balance at December 31, 2022 87 $ 2,004 2 $ 44 — $ — — $ — $ 21,550 Purchases of common stock — — — — — — — — — Equity-based compensation — — — — — — — — 1,708 Issuance of restricted shares/units — — — — — — — — — Issuance of common stock — — — — — — — — — Issuances of preferred shares 3,391 75,502 192 4,613 — — — — — Dividends declared – preferred stock – Series D ($2.11/share) — — — — — — — — — Dividends declared – preferred stock – Series F ($1.84/share) — — — — — — — — — Dividends declared – preferred stock – Series G ($1.84/share — — — — — — — — — Dividends declared – preferred stock – Series H ($1.88/share) — — — — — — — — — Dividends declared – preferred stock – Series I ($1.88/share) — — — — — — — — — Dividends declared – preferred stock – Series J ($2.00/share) — — — — — — — — — Dividends declared – preferred stock – Series K ($2.05/share) — — — — — — — — — Redemption value adjustment — — — — — — — — 1,576 Redemption value adjustment - preferred stock — 2,547 — 126 — — — — — Redemption of preferred stock (3) (78) — — — — — — — Contributions from noncontrolling interests in consolidated entities — — — — — — — — — Extinguishment of preferred stock — — — — — — — — — Noncontrolling interest in consolidated entities recognized upon consolidation of VIE — — — — — — — — — Distributions to noncontrolling interests — — — — — — — — (588) Net income (loss) — — — — — — — — (2,239) Balance at December 31, 2023 3,475 $79,975 194 $4,783 — $ — — $ — $ 22,007 Purchases of common stock — — — — — — — — — Equity-based compensation — — — — — — — — 1,151 Issuance of restricted shares/units — — — — — — — — — Issuances of common stock — — — — — — — — — Issuances of preferred shares 3,415 76,229 439 10,541 — — — — — Dividends declared – preferred stock – Series D ($2.11/share) — — — — — — — — — Dividends declared – preferred stock – Series F ($1.84/share) — — — — — — — — — Dividends declared – preferred stock – Series G ($1.84/share — — — — — — — — — Dividends declared – preferred stock – Series H ($1.88/share) — — — — — — — — — Dividends declared – preferred stock – Series I ($1.88/share) — — — — — — — — — Dividends declared – preferred stock – Series J ($2.00/share) — — — — — — — — — Dividends declared – preferred stock – Series K ($2.06/share) — — — — — — — — — Dividends declared - Stirling OP — — — — — — — — — Issuances of Stirling OP common units — — — — — — — — — Redemption value adjustment — — — — — — — — 34 Redemption value adjustment - preferred stock — 2,565 — 341 — — — — — Redemption of preferred stock (90) (2,098) (32) (796) — — — — — Contributions from noncontrolling interests in consolidated entities — — — — — — — — — 83
Page 90
Preferred Stock Series J Series K Series L Series M Shares Amount Shares Amount Shares Amount Shares Amount RedeemableNoncontrollingInterest inOperatingPartnership Extinguishment of preferred stock — — — — — — — — — Distributions to noncontrolling interests — — — — — — — — — Net income (loss) — — — — — — — — (683) Balance at December 31, 2024 6,800 $156,671 601 $14,869 — $ — — $ — $ 22,509 Purchases of common stock — — — — — — — — — Equity-based compensation — — — — — — — — (348) Issuance of common stock — — — — — — — — — Issuances of preferred shares 1,039 23,369 168 4,051 243 4,546 565 11,713 — Costs for issuances of common shares — — — — — — — — — Dividends declared – preferred stock – Series D ($2.11/share) — — — — — — — — — Dividends declared – preferred stock – Series F ($1.84/share) — — — — — — — — — Dividends declared – preferred stock – Series G ($1.84/share — — — — — — — — — Dividends declared – preferred stock – Series H ($1.88/share) — — — — — — — — — Dividends declared – preferred stock – Series I ($1.88/share) — — — — — — — — — Dividends declared – preferred stock – Series J ($2.00/share) — — — — — — — — — Dividends declared – preferred stock – Series K ($2.07/share) — — — — — — — — — Dividends declared – preferred stock – Series L ($1.41/share) — — — — — — — — — Dividends declared – preferred stock – Series M ($1.44/share) — — — — — — — — — Dividends declared - Stirling OP — — — — — — — — — Issuances of Stirling OP common units — — — — — — — — — Redemption of Stirling OP common units — — — — — — — — — Redemption value adjustment — — — — — — — — 1,617 Redemption value adjustment - preferred stock — 3,431 — 254 — 1,064 — 2,200 — Redemption of preferred stock (155) (3,653) (38) (959) (5) (126) (14) (347) — Contributions from noncontrolling interests in consolidated entities — — — — — — — — — Contribution from Stirling Advisor — — — — — — — — — Net income (loss) — — — — — — — — (3,262) Balance at December 31, 2025 7,684 $179,818 731 $18,215 238 $5,484 551 $13,566 $ 20,516 See Notes to Consolidated Financial Statements. 84
Page 91
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) Year Ended December 31, 2025 2024 2023 Cash Flows from Operating Activities Net income (loss) $ (188,159) $ (65,011) $ (180,734) Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Depreciation and amortization 141,295 152,776 187,807 Impairment charges 67,648 59,331 — Amortization of intangibles (1,148) (158) (95) Recognition of deferred income (432) (271) (820) Bad debt expense 2,099 2,254 3,602 Deferred income tax expense (benefit) (242) 11 (28) Equity in (earnings) loss of unconsolidated entities 325 2,370 1,134 (Gain) loss on consolidation of VIE and disposition of assets and hotel properties (79,799) (94,406) (11,488) (Gain) loss on derecognition of assets (39,054) (167,177) — (Gain) loss on extinguishment of debt (335) (2,774) (53,386) Realized and unrealized (gain) loss on derivatives 5,346 6,480 2,200 Amortization of loan costs, discounts and capitalized default interest and write-off of premiums, loan costs and exit fees 22,956 19,421 28,203 Amortization of deferred franchise fees — — 34 Write-off of deferred franchise fees — — 20 Equity-based compensation (761) 2,097 4,027 Non-cash interest income (1,596) (1,326) (821) Changes in operating assets and liabilities, exclusive of the effect of the consolidation of VIE and disposition of asset andhotel properties and derecognition of assets: Accounts receivable and inventories 537 1,641 (7,330) Prepaid expenses and other assets 7,185 (1,714) (1,648) Accounts payable and accrued expenses and accrued interest payable 3,103 9,305 4,355 Accrued interest associated with hotels in receivership 39,038 42,509 14,024 Due to/from related parties (892) (3,037) 11,241 Due to/from third-party hotel managers (4,326) (1,931) (789) Due to/from Ashford Inc., net 8,509 14,253 14,896 Operating lease liabilities (324) (394) 104 Operating lease right-of-use assets 321 387 (111) Other liabilities 3,038 1,772 (7) Net cash provided by (used in) operating activities (15,668) (23,592) 14,390 Cash Flows from Investing Activities Improvements and additions to hotel properties (71,150) (108,013) (137,428) Net proceeds from disposition of assets and hotel properties 242,437 300,022 29,214 Net proceeds from sale of historical tax credits 18,761 — — Payments for initial franchise fees — (200) (599) Proceeds from notes receivable — 2,512 5,250 Issuance of note receivable (26) (4,490) (6,868) Proceeds from property insurance 734 1,452 2,478 Restricted cash received from initial consolidation of VIE — — 18,201 Net cash provided by (used in) investing activities 190,756 191,283 (89,752) Cash Flows from Financing Activities Borrowings on indebtedness 560,407 63,793 134,802 Repayments of indebtedness (709,174) (388,339) (396,947) Payments for loan costs and exit fees (50,311) (20,941) (13,220) Payments for dividends and distributions (23,957) (20,365) (14,943) Purchases of common stock (44) (49) (90) Redemption of preferred stock — — (78) Payments for derivatives (5,120) (16,286) (28,256) Proceeds from derivatives 3,038 27,805 59,351 Proceeds from common stock offerings — 8,783 1,031 85
Page 92
Year Ended December 31, 2025 2024 2023 Proceeds from preferred stock offerings 39,708 84,843 79,564 Costs for issuances of common shares (143) — — Payments on finance lease liabilities (456) (477) (249) Issuance of Stirling OP common units 56 129 — Redemption of Stirling OP common units (685) — — Contributions from noncontrolling interests 7,514 4,866 6,905 Distributions to noncontrolling interest in consolidated entities — (2,512) — Net cash provided by (used in) financing activities (179,167) (258,750) (172,130) Net increase (decrease) in cash, cash equivalents and restricted cash (including cash, cash equivalents and restricted cash held forsale) (4,079) (91,059) (247,492) Cash, cash equivalents and restricted cash at beginning of period (including cash, cash equivalents and restricted cash held forsale) 220,475 311,534 559,026 Cash, cash equivalents and restricted cash at end of period (including cash, cash equivalents and restricted cash held for sale) $ 216,396 $ 220,475 $ 311,534 Supplemental Cash Flow Information Interest paid $ 224,299 $ 268,778 $ 325,420 Income taxes paid (refunded) (1,954) (287) (2,644) Supplemental Disclosure of Non-Cash Investing and Financing Activities Accrued but unpaid capital expenditures $ 31,144 $ 15,244 $ 22,460 Non-cash extinguishment of debt — 8,881 154,192 Non-cash loan principal associated with default interest and late charges 14,080 — — Non-cash extinguishment of preferred stock — 14,581 7,724 Issuance of common stock from preferred stock exchanges — 8,317 4,334 Non-cash preferred stock dividends 3,958 1,940 387 Unsettled proceeds from derivatives — 179 1,674 Non-cash derecognition of assets — 231,645 — Dividends and distributions declared but not paid 4,247 3,952 3,566 Contribution from Stirling Advisor 5,303 — — Assumption of debt from consolidation of VIE — — 35,052 Assumption of other finance liability from consolidation of VIE — — 26,729 Acquisition of hotel property from consolidation of VIE — — 61,100 Non-cash distributions to non-controlling interest — — 588 Supplemental Disclosure of Cash, Cash Equivalents and Restricted Cash Cash and cash equivalents at beginning of period $ 112,907 $ 165,231 $ 417,064 Restricted cash at beginning of period 99,695 146,079 141,962 Cash, cash equivalents and restricted cash at beginning of period $ 212,602 $ 311,310 $ 559,026 Cash and cash equivalents at beginning of period included in assets held for sale 15 1 — Restricted cash at beginning of period included in assets held for sale 7,858 223 — Cash, cash equivalents and restricted cash at beginning of period (including cash, cash equivalents and restricted cash held forsale) $ 220,475 $ 311,534 $ 559,026 Cash and cash equivalents at end of period $ 66,145 $ 112,907 $ 165,231 Restricted cash at end of period 149,580 99,695 146,079 Cash, cash equivalents and restricted cash at end of period $ 215,725 $ 212,602 $ 311,310 Cash and cash equivalents at end of period included in assets held for sale 671 15 1 Restricted cash at end of period included in assets held for sale — 7,858 223 Cash, cash equivalents and restricted cash at end of period (including cash, cash equivalents and restricted cash held for sale) $ 216,396 $ 220,475 $ 311,534 See Notes to Consolidated Financial Statements. 86
Page 93
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the Years Ended December 31, 2025, 2024 and 2023 1. Organization and Description of Business Ashford Hospitality Trust, Inc., together with its subsidiaries (“Ashford Trust”), is a real estate investment trust (“REIT”). While our portfolio currently consists of upscale hotels and upper upscale full-service hotels, our investment strategy is predominantly focused on investing in upper upscale full-service hotels in the United States that have revenue per available room (“RevPAR”) generally less than twice the U.S. national average, and in all methods including direct real estate, equity and debt. We currently anticipate future investments will predominantly be in upper upscale hotels. We own our lodging investments and conduct our business through Ashford Hospitality Limited Partnership (“Ashford Trust OP”), our operating partnership. Ashford OP General Partner LLC, a wholly owned subsidiary of Ashford Trust, serves as the sole general partner of our operating partnership. Terms such as “the Company,” “we,” “us” or “our” refer to Ashford Hospitality Trust, Inc. and, as the context may require, all entities included in its consolidated financial statements. Our hotel properties are primarily branded under the widely recognized upscale and upper upscale brands of Hilton, Hyatt, Marriott and Intercontinental Hotel Group. As of December 31, 2025, we held interests in the following assets: • 67 consolidated operating hotel properties, which represent 16,445 total rooms; • one consolidated operating hotel property, which represents 188 total rooms through a 29.3%-owned investment in a consolidated entity; and • an investment in an entity that owns the Meritage Resort and Spa and the Grand Reserve at the Meritage (the “Meritage Investment”) in Napa, California, with a carrying value of approximately $7.3 million. For U.S. federal income tax purposes, we have elected to be treated as a REIT, which imposes limitations related to operating hotels. As of December 31, 2025, our 68 operating hotel properties were leased by our wholly-owned or majority-owned subsidiaries, which are treated as taxable REIT subsidiaries for U.S. federal income tax purposes (collectively, these subsidiaries are referred to as “Ashford TRS”). Ashford TRS then engages third-party or affiliated hotel management companies to operate the hotels under management contracts. Hotel operating results related to these properties are included in the consolidated statements of operations. We are advised by Ashford Hospitality Advisors LLC (“Ashford LLC”), a subsidiary of Ashford Inc., through the Third Amended and Restated Advisory Agreement with Ashford LLC (as amended, the “Advisory Agreement”). Our 68 operating hotel properties in our consolidated portfolio are currently asset-managed by Ashford LLC. We do not have any employees. All of the services that might be provided by employees are provided to us by Ashford LLC. We do not operate any of our hotel properties directly; instead, we contractually engage hotel management companies to operate them for us under management contracts. Remington Lodging & Hospitality, LLC (“Remington Hospitality”), a subsidiary of Ashford Inc., manages 50 of our 68 operating hotel properties. Third-party management companies manage the remaining hotel properties. Ashford Inc. also provides other products and services to us or our hotel properties through certain entities in which Ashford Inc. has an ownership interest. These products and services include, but are not limited to, design and construction services, debt placement and related services, audiovisual services, real estate advisory and brokerage services, insurance policies covering general liability, workers’ compensation and business automobile claims and insurance claims services, hypoallergenic premium rooms, watersport activities, broker- dealer and distribution services and cash management services. 2. Significant Accounting Policies Basis of Presentation—The accompanying consolidated financial statements include the accounts of Ashford Hospitality Trust, Inc., its majority-owned subsidiaries, its majority-owned joint ventures in which it has a controlling interest and entities in which the Company is the primary beneficiary. All significant inter-company accounts and transactions between consolidated entities have been eliminated in these consolidated financial statements. Going Concern—The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As of December 31, 2025, the Company held cash and cash equivalents of $66.8 million and restricted cash of $149.6 million (including amounts held for sale). During the year ended December 31, 2025, the net decrease in cash, cash equivalents and restricted cash (including cash, cash equivalents and restricted cash held for sale) was $4.1 million. 87
Page 94
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) The Company forecasts it may not have enough cash to support the Company’s daily operations one year from the date the financial statements are issued due primarily to anticipated debt service costs, debt maturities and the potential termination fee the Company would owe to Ashford LLC upon the triggering of the change of control provision in the Advisory Agreement. We have $1.9 billion of non- recourse loans that mature within one year from the date the financial statements are issued. If these loans are not refinanced and our lenders elect to foreclose on these properties, the change of control provision in the Advisory Agreement could be triggered beginning November 16, 2026 resulting in a termination fee (as defined in the Advisory Agreement - see note 17.) We are taking several steps to reduce our cash utilization and potentially raise additional capital. The Company’s ability to continue as a going concern is dependent upon its ability to improve the profitability of its operations, refinance or extend the maturity of our loans and increase our cash position from the sale of certain hotel properties. While the Company believes in the viability of its strategy, GAAP requires that in making this determination the Company cannot consider any remedies outside of the Company’s control which have not been fully implemented. As such, the Company could not consider future potential fundraising activities, whether through equity or debt offerings or dispositions of hotel properties as we could not conclude they were probable of being effectively implemented. Based on these factors, the Company has determined that there is substantial doubt about the Company’s ability to continue as a going concern within one year after the date the financial statements are issued. The consolidated financial statements have been prepared assuming that the Company will continue as a going concern and do not include any adjustments that might result from the outcome of this uncertainty. Variable Interest Entities—Ashford Trust OP is considered to be a variable interest entity (“VIE”), as defined by authoritative accounting guidance. A VIE must be consolidated by a reporting entity if the reporting entity is the primary beneficiary because it has (i) the power to direct the VIE’s activities that most significantly impact the VIE’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE. All major decisions related to Ashford Trust OP that most significantly impact its economic performance, including but not limited to operating procedures with respect to business affairs and any acquisitions, dispositions, financings, restructurings or other transactions with sellers, purchasers, lenders, brokers, agents and other applicable representatives, are subject to the approval of our wholly owned subsidiary, Ashford Trust OP General Partner LLC, its general partner. As such, we consolidate Ashford Trust OP. As Ashford Trust OP is substantially the same as Ashford Hospitality Trust, Inc., our REIT, the separate VIE accounts for this VIE are not reflected separately on the balance sheet. On May 31, 2023, Ashford Trust obtained the ability to exercise its kick-out rights of the manager of 815 Commerce Managing Member LLC (“815 Commerce MM”), which is developing the Le Méridien hotel in Fort Worth, Texas. As a result, Ashford Trust became the primary beneficiary and began consolidating 815 Commerce MM. The hotel property is subject to a 99-year lease of the land and building that has been accounted for as a failed sale and leaseback. In 2023, the Company determined that 815 Commerce MM is a VIE that is not a business. As such, the Company measured and recognized 100% of the identifiable assets acquired, the liabilities assumed and any noncontrolling interests of 815 Commerce MM, at fair value. The Company recognized a gain of $1.1 million that represented the difference between the fair value of the assets and liabilities recognized, the fair value of the non-controlling interest and the previous carrying value of the Company’s investment in 815 Commerce MM. The gain is included in “gain (loss) on consolidation of VIE and disposition of assets” in the consolidated statements of operations. Prior to September 2, 2025, the Company had a contribution agreement with Stirling REIT OP, LP (“Stirling OP”). Pursuant to the terms of the contribution agreement, the Company contributed its equity interests, and the associated debt and other obligations, in the Residence Inn Manchester, the Hampton Inn Buford, the SpringHill Suites Buford and the Residence Inn Jacksonville to Stirling OP in exchange for 1.4 million Class I units of Stirling OP. The Company determined Ashford Trust to be the primary beneficiary of Stirling OP in contemplation of: (1) the related party group comprising: (i) Ashford Trust and (ii) the stockholders who have control over the election or removal of the board of directors of Stirling Hotels & Resorts, Inc. (“Stirling Inc.”) who have power to direct the most significant activities of Stirling OP; and (2) the consideration that substantially all the economics are held by the Company through its equity interest, and substantially all of the activities are performed on the Company’s behalf. As such, the Company consolidated Stirling OP. On September 2, 2025, the Company became the sole remaining unit holder and general partner of Stirling OP when Stirling OP redeemed all of its unit holders other than Ashford Trust OP and Ashford TRS for an aggregate of $685,000 in cash. The Company remains the primary beneficiary of Stirling OP and Stirling OP’s properties and debt continue to be reflected on the Company’s balance sheet at their historical carrying values as of December 31, 2025. 88
Page 95
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) During the year ended December 31, 2025, Ashford M Investor LLC (“Ashford Investor LLC”) issued preferred membership interests in the Renaissance Hotel in Nashville, Tennessee in return for $88.0 million. The preferred membership interests issued to the holder are classified as liabilities within “indebtedness, net” in the consolidated balance sheet and do not constitute equity at risk. Ashford Investor LLC is considered a VIE. Ashford Trust as managing member, has the power to direct the activities that most significantly impact Ashford Investor LLC’s economic performance, while the holder, as non ‑ managing member, holds participating rights over certain major decisions but does not have the ability to remove Ashford Trust without cause. Based on these factors, Ashford Trust is identified as the primary beneficiary and consolidates Ashford Investor LLC. See note 7. Comparability—The following transactions affect reporting comparability of our consolidated financial statements: Hotel Property Location Type Date WorldQuest Resort Orlando, FL Disposition August 1, 2023 Sheraton Bucks County Langhorne, PA Disposition November 9, 2023 Embassy Suites Flagstaff Flagstaff, AZ Disposition November 29, 2023 Embassy Suites Walnut Creek Walnut Creek, CA Disposition November 29, 2023 Marriott Bridgewater Bridgewater, NJ Disposition November 29, 2023 Marriott Research Triangle Park Durham, NC Disposition November 29, 2023 W Atlanta Atlanta, GA Disposition November 29, 2023 Courtyard Columbus Tipton Lakes Columbus, IN Derecognized March 1, 2024 Courtyard Old Town Scottsdale, AZ Derecognized March 1, 2024 Residence Inn Hughes Center Las Vegas, NV Derecognized March 1, 2024 Residence Inn Phoenix Airport Phoenix, AZ Derecognized March 1, 2024 Residence Inn San Jose Newark Newark, CA Derecognized March 1, 2024 SpringHill Suites Manhattan Beach Hawthorne, CA Derecognized March 1, 2024 SpringHill Suites Plymouth Meeting Plymouth Meeting, PA Derecognized March 1, 2024 Courtyard Basking Ridge Basking Ridge, NJ Derecognized March 1, 2024 Courtyard Newark Silicon Valley Newark, CA Derecognized March 1, 2024 Courtyard Oakland Airport Oakland, CA Derecognized March 1, 2024 Courtyard Plano Legacy Park Plano, TX Derecognized March 1, 2024 Residence Inn Plano Plano, TX Derecognized March 1, 2024 SpringHill Suites BWI Airport Baltimore, MD Derecognized March 1, 2024 TownePlace Suites Manhattan Beach Hawthorne, CA Derecognized March 1, 2024 Residence Inn Salt Lake City Salt Lake City, UT Disposition March 6, 2024 Hilton Boston Back Bay Boston, MA Disposition April 9, 2024 Hampton Inn Lawrenceville Lawrenceville, GA Disposition April 23, 2024 Courtyard Manchester Manchester, CT Disposition May 30, 2024 SpringHill Suites Kennesaw Kennesaw, GA Disposition June 10, 2024 Fairfield Inn Kennesaw Kennesaw, GA Disposition June 10, 2024 One Ocean Atlantic Beach, FL Disposition June 27, 2024 The Ashton Fort Worth, TX Disposition July 16, 2024 Le Méridien Fort Worth Fort Worth, TX Developed August 29, 2024 Courtyard Boston Boston, MA Disposition January 10, 2025 Residence Inn Evansville Evansville, IN Disposition August 11, 2025 Hilton NASA Clear Lake Houston, TX Disposition August 22, 2025 Residence Inn San Diego San Diego, CA Disposition October 15, 2025 Le Pavillon New Orleans, LA Disposition December 18, 2025 Use of Estimates—The preparation of these consolidated financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Cash and Cash Equivalents—Cash and cash equivalents include cash on hand or held in banks and short-term investments with an initial maturity of three months or less at the date of purchase. 89
Page 96
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Restricted Cash—Restricted cash includes reserves for debt service, real estate taxes, and insurance, as well as excess cash flow deposits and reserves for FF&E replacements of approximately 4% to 5% of property revenue for certain hotels, as required by certain management or mortgage debt agreement restrictions and provisions. Accounts Receivable—Accounts receivable consists primarily of meeting and banquet room rental and hotel guest receivables. We generally do not require collateral. We maintain an allowance for doubtful accounts for estimated losses resulting from the inability of guests to make required payments for services. The allowance is maintained at a level believed to be adequate to absorb estimated receivable losses. The estimate is based on past receivable loss experience, known and inherent credit risks, current economic conditions, and other relevant factors, including specific reserves for certain accounts. Inventories—Inventories, which primarily consist of food, beverages, and gift store merchandise, are stated at the lower of cost or net realizable value. Cost is determined using the first-in, first-out method. Investments in Hotel Properties, net—Hotel properties are generally stated at cost. All improvements and additions that extend the useful life of the hotel properties are capitalized. For property and equipment acquired in a business combination, we record the assets acquired based on their fair value as of the acquisition date. Replacements and improvements and finance leases are capitalized, while repairs and maintenance are expensed as incurred. Property and equipment acquired in an asset acquisition are recorded at cost. The acquisition cost in an asset acquisition is allocated to land, buildings, improvements, furniture, fixtures and equipment, as well as identifiable intangible and lease assets and liabilities. Acquisition cost is allocated using relative fair values. We evaluate several factors, including weighted market data for similar assets, expected future cash flows discounted at risk adjusted rates, and replacement costs for assets to determine an appropriate exit cost when evaluating the fair values. Our property and equipment, including assets acquired under finance leases, are depreciated on a straight-line basis over the estimated useful lives of the assets with useful lives. Impairment of Investments in Hotel Properties—Hotel properties are reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. Recoverability of the hotel is measured by comparison of the carrying amount of the hotel to the estimated future undiscounted cash flows, which take into account current market conditions and our intent with respect to holding or disposing of the hotel. If our analysis indicates that the carrying value of the hotel is not recoverable on an undiscounted cash flow basis, we recognize an impairment charge for the amount by which the property’s net book value exceeds its estimated fair value. In evaluating impairment of hotel properties, we make many assumptions and estimates, including projected cash flows, expected holding periods, and expected useful lives. Fair value is determined through various valuation techniques, including internally developed discounted cash flow models, comparable market transactions and third-party appraisals, where considered necessary. We recorded impairment charges of $67.6 million, $59.3 million, and $0 for the years ended December 31, 2025, 2024, and 2023, respectively. See note 5. Assets Held for Sale, Discontinued Operations and Hotel Dispositions—We classify assets as held for sale when we have obtained a firm commitment from a buyer, and consummation of the sale is considered probable and expected within one year. The related operations of assets held for sale are reported as discontinued if the disposal is a component of an entity that represents a strategic shift that has (or will have) a major effect on our operations and cash flows. Depreciation and amortization will cease as of the date assets have met the criteria to be deemed held for sale and the hotel property is measured at the lower of its carrying value or fair value less costs to sell. See note 5. Discontinued operations are defined as the disposal of components of an entity that represents strategic shifts that have (or will have) a major effect on an entity’s operations and financial results. We believe that individual dispositions of hotel properties do not represent a strategic shift that has (or will have) a major effect on our operations and financial results as most will not fit the definition. See note 5. Investments in Unconsolidated Entities—As of December 31, 2025, we held a 15.1% ownership interest in OpenKey and an investment in an entity that owns two resorts in Napa, CA, which are accounted for under the equity method of accounting by recording the initial investment and our percentage of interest in the entities’ net income/loss. We review the investments for impairment each reporting period pursuant to the applicable authoritative accounting guidance. An investment is impaired when its estimated fair value is less than the carrying amount of our investment. Any other-than-temporary impairment is recorded in “equity in earnings (loss) of unconsolidated entities” in the consolidated statements of operations. See note 6. 90
Page 97
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Our investments in certain unconsolidated entities are considered to be variable interests in the underlying entities. Each VIE, as defined by authoritative accounting guidance, must be consolidated by a reporting entity if the reporting entity is the primary beneficiary because it has (i) the power to direct the VIE’s activities that most significantly impact the VIE’s economic performance, and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE. Because we do not have the power and financial responsibility to direct the unconsolidated entities’ activities and operations, we are not considered to be the primary beneficiary of these entities on an ongoing basis and therefore such entities are not consolidated. Notes Receivable, net—We record notes receivable at present value upon the transaction date. Any discount or premium is amortized using the effective interest method. Impairment of Notes Receivable—We review notes receivable for impairment each reporting period. The impairment model requires an estimate of expected credit losses, measured over the contractual life of an instrument, that considers forecasts of future economic conditions in addition to information about past events and current conditions. The Company will estimate credit losses over the entire contractual term of the instrument from the date of initial recognition of that instrument and is required to record a credit loss expense (or reversal) in each reporting period. Loan impairments are recorded as a valuation allowance and a charge to earnings. Our assessment of impairment is based on considerable management judgment and assumptions. No impairment charges were recorded for the years ended December 31, 2025, 2024 and 2023. Leases—We determine if an arrangement is a lease at the commencement date. Operating leases, as lessee, are included in operating lease right-of-use (“ROU”) assets and operating lease liabilities on our consolidated balance sheets. Finance leases, as lessee, are recorded based on the underlying nature of the leased asset and finance lease liabilities. Operating lease ROU assets and finance lease assets and operating and finance lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset and finance lease asset also includes any lease payments made and initial direct costs incurred and excludes lease incentives. The lease terms used to calculate our right-of-use asset and the investments in hotel properties may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Subsequent to the initial recognition, lease liabilities are measured using the effective interest method. The ROU asset is generally amortized utilizing a straight-line method adjusted for the lease liability accretion during the period. We have lease agreements with lease and non-lease components, which under the elected practical expedients under Accounting Standard Codification (“ASC”) 842, we are not accounting for separately. For certain equipment leases, such as office equipment, copiers and vehicles, we account for the lease and non-lease components as a single lease component. Intangible Assets and Liabilities—Intangible assets represent the acquisition of a permanent docking easement and intangible liabilities represent the liabilities recorded on certain hotel properties’ lessor lease contracts that were below market rates at the date of acquisition. The asset is not subject to amortization and liabilities are amortized using the straight-line method over the remaining terms of the respective lease contracts. See note 22. Deferred Costs, net—Debt issuance costs associated with debt obligations are reflected as a direct reduction to the related debt obligation on our consolidated balance sheets. Debt issuance costs are recorded at cost and amortized over the terms of the related indebtedness using the effective interest method. Prior to the repayment of the term loan associated with Oaktree Capital Management, L.P. (the “Oaktree Credit Agreement”) on February 12, 2025, we also had debt issuance costs related to delayed draw term loans in the Oaktree Credit Agreement that met the definition of an asset and were amortized on a straight-line basis over the contractual term of the arrangement. Deferred franchise fees are amortized on a straight-line basis over the terms of the related franchise agreements and are presented as an asset on our consolidated balance sheets. See note 21. Derivative Instruments and Hedging—We use interest rate derivatives to hedge our risks and to capitalize on the historical correlation between changes in the Secured Overnight Financing Rate (“SOFR”) and RevPAR. Interest rate derivatives could include swaps, caps, floors, and flooridors. All derivatives are recorded at fair value in accordance with the applicable authoritative accounting guidance. None of our derivative instruments are designated as cash flow hedges. Interest rate derivatives are reported as “derivative assets” in the 91
Page 98
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) consolidated balance sheets. For interest rate derivatives and credit default swaps, changes in fair value and realized gains and losses are recognized in earnings as “realized and unrealized gain (loss) on derivatives” in the consolidated statements of operations. Accrued interest on interest rate derivatives is included in “accounts receivable, net” in the consolidated balance sheets. Due to/from Related Parties—Due to/from related parties represents current receivables and payables resulting from transactions related to hotel management with a related party. Due to/from related parties is generally settled within a period not exceeding one year. Due to/from Ashford Inc.—Due to/from Ashford Inc. represents current receivables and payables resulting from the advisory services fee, including reimbursable expenses as well as other hotel products and services. Due to/from Ashford Inc. is generally settled within a period not exceeding one year. Due to/from Third-Party Hotel Managers—Due to/from third-party hotel managers primarily consists of amounts due from Marriott related to our cash reserves held at the Marriott corporate level related to our operations, real estate taxes and other items. Due to/from third- party hotel managers also represents current receivables and payables resulting from transactions related to hotel management. Due to/from third-party hotel managers is generally settled within a period not exceeding one year. Noncontrolling Interests—The redeemable noncontrolling interests in Ashford Trust OP represent the limited partners’ proportionate share of equity in earnings/losses of Ashford Trust OP, which is an allocation of net income attributable to the common unit holders based on the weighted average ownership percentage of these limited partners’ common unit holdings throughout the period. The redeemable noncontrolling interests in Ashford Trust OP is classified in the mezzanine section of the consolidated balance sheets as these redeemable operating partnership units do not meet the requirements for permanent equity classification prescribed by the authoritative accounting guidance because these redeemable operating partnership units may be redeemed by the holder as described in note 13. The carrying value of the noncontrolling interests in Ashford Trust OP is based on the greater of the accumulated historical cost or the redemption value. The noncontrolling interests in consolidated entities also included an ownership interest of 70.7% in 815 Commerce MM as of December 31, 2025. Net income/loss attributable to redeemable noncontrolling interests in Ashford Trust OP and income/loss from consolidated entities attributable to noncontrolling interests in our consolidated entities are reported as deductions/additions from/to net income/loss. Comprehensive income/loss attributable to these noncontrolling interests is reported as reductions/additions from/to comprehensive income/loss. Revenue Recognition—Rooms revenue represents revenue from the occupancy of our hotel rooms, which is driven by the occupancy and average daily rate charged. Rooms revenue includes revenue for guest no-shows, day use, and early/late departure fees. The contracts for room stays with customers are generally short in duration and revenues are recognized as services are provided over the course of the hotel stay. Advance deposits are recorded as liabilities when a customer or group of customers provides a deposit for a future stay or banquet event at our hotels. Advance deposits are converted to revenue when the services are provided to the customer or when the customer with a noncancellable reservation fails to arrive for part or all of the reservation. Conversely, advance deposits are generally refundable upon guest cancellation of the related reservation within an established period of time prior to the reservation. Our advance deposit balance as of December 31, 2025 and 2024 was $26.7 million and $25.3 million, respectively, and are generally recognized as revenue within a one-year period. These are included in “accounts payable and accrued expenses” on the consolidated balance sheets. Food & Beverage (“F&B”) revenue consists of revenue from the restaurants and lounges at our hotel properties, in-room dining and mini-bars revenue, and banquet/catering revenue from group and social functions. Other F&B revenue may include revenue from audiovisual equipment/services, rental of function rooms, and other F&B related revenue. Revenue is recognized as the services or products are provided. Our hotel properties may employ third parties to provide certain services at the property, for example, audiovisual services. We evaluate each of these contracts to determine if the hotel is the principal or the agent in the transaction, and record the revenue as appropriate (i.e. gross vs. net). Other hotel revenue consists of ancillary revenue at the property, including attrition and cancellation fees, resort and destination fees, spas, parking, entertainment and other guest services, as well as rental revenue primarily from leased retail outlets at our hotel properties. Cancellation fees are recognized from non-cancellable deposits when the customer provides notification of cancellation in accordance with established management policy time frames. 92
Page 99
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Taxes collected from customers and submitted to taxing authorities are not recorded in revenue. Interest income is recognized when earned. Other Hotel Expenses—Other hotel expenses include Internet, telephone charges, guest laundry, valet parking, and hotel-level general and administrative, sales and marketing expenses, repairs and maintenance, franchise fees and utility costs. They are expensed as incurred. Advertising Costs—Advertising costs are charged to expense as incurred. For the years ended December 31, 2025, 2024 and 2023, we incurred advertising costs of $10.6 million, $10.4 million and $11.1 million, respectively. Advertising costs are included in “other” hotel expenses in the accompanying consolidated statements of operations. Equity-Based Compensation—Stock/unit-based compensation for non-employees is measured at the grant date and expensed ratably over the vesting period based on the original measurement as of the grant date. This results in the recording of expense, included in “advisory services fee,” “management fees” and “corporate, general and administrative” expense, equal to the ratable amount of the grant date fair value based on the requisite service period satisfied during the period. The Company recognizes forfeitures as they occur. The criteria for the PSU and Performance LTIP units are based on performance conditions and market conditions under the relevant literature. The corresponding compensation cost is recognized, based on the grant date fair value of the award, ratably over the service period for the award as the service is rendered, which may vary from period to period, as the number of performance grants earned may vary based on the estimated probable achievement of certain performance targets (performance conditions). The number of PSU and Performance LTIP units to be earned based on the applicable performance conditions is determined upon the final vesting date. The initial calculation of the PSU and Performance LTIP units earned can range from 0% to 200% of target, which is further subjected to a specified absolute total stockholder return modifier (market condition) based on the formulas determined by the Company’s compensation committee on the grant date. This will result in an adjustment (75% to 125%) of the initial calculation of the number of performance awards earned based on the applicable performance targets resulting in a final award calculation ranging from 0% to 250% of the target amount. Stock/unit grants to certain independent directors are measured at the grant date based on the market price of the shares at grant date, which amount is fully expensed as the grants of stock/units are fully vested on the date of grant. Depreciation and Amortization—Depreciation expense is based on the estimated useful life of the assets, while amortization expense for leasehold improvements and finance leases are based on the shorter of the lease term or the estimated useful life of the related assets. Presently, hotel properties are depreciated using the straight-line method over lives ranging from 7.5 to 39 years for buildings and improvements and 1.5 to 5 years for FF&E and 32 years for our Marietta finance lease. While we believe our estimates are reasonable, a change in estimated useful lives could affect depreciation and amortization expense and net income (loss) as well as resulting gains or losses on potential hotel sales. Income Taxes—As a REIT, we generally are not subject to federal corporate income tax on the portion of our net income (loss) that does not relate to taxable REIT subsidiaries. However, Ashford TRS is treated as a taxable REIT subsidiary for U.S. federal income tax purposes. In accordance with authoritative accounting guidance, we account for income taxes related to Ashford TRS using the asset and liability method under which deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. In addition, the analysis utilized by us in determining our deferred tax asset valuation allowance involves considerable management judgment and assumptions. See note 20. The “Income Taxes” topic of the ASC issued by the Financial Accounting Standards Board (“FASB”) which addresses the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. The guidance requires us to determine whether tax positions we have taken or expect to take in a tax return are more likely than not to be sustained upon examination by the appropriate taxing authority based on the technical merits of the positions. Tax positions that do not meet the more likely than not threshold would be recorded as additional tax expense in the current period. We analyze all open tax years, as defined by the statute of limitations for each jurisdiction, which includes the federal jurisdiction and various states. We classify interest and penalties related to underpayment of income taxes as income tax expense. We and our subsidiaries file income tax returns in the U.S. federal jurisdiction and various states and cities. Tax years 2021 through 2025 remain subject to potential examination by certain federal and state taxing authorities. Income (Loss) Per Share—Basic income (loss) per common share is calculated by dividing net income (loss) attributable to common stockholders by the weighted average common shares outstanding during the period using the two-class method 93
Page 100
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) prescribed by applicable authoritative accounting guidance. Diluted income (loss) per common share is calculated using the two-class method, or the treasury stock method, if more dilutive. Diluted income (loss) per common share reflects the potential dilution that could occur if securities or other contracts to issue common shares were exercised or converted into common shares, whereby such exercise or conversion would result in lower income per share. Recently Adopted Accounting Standards—In December 2023, the FASB issued ASU 2023-09 Income Taxes (Topics 740): Improvements to Income Tax Disclosures to expand the disclosure requirements for income taxes, specifically related to the rate reconciliation and income taxes paid. ASU 2023-09 is effective for our annual periods beginning January 1, 2025. The amendments in this ASU may be applied prospectively by providing the revised disclosures for the period ending December 31, 2025 and continuing to provide the pre-ASU disclosures for the prior periods, or the amendments may be applied retrospectively by providing the revised disclosures for all periods presented. As of December 31, 2025, the Company has prospectively adopted this ASU. The adoption of this ASU only impacted disclosures with respect to the Company’s consolidated financial statements. Recently Issued Accounting Standards—In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40) Disaggregation of Income Statement Expenses that requires more detailed information about specified categories of expenses (purchases of inventory, employee compensation, depreciation, amortization, and depletion) included in certain expense captions presented on the face of the statement of operations. In January 2025, the FASB issued ASU 2025-01 which amends the effective date of the new disaggregation of income statement expenses standard to clarify that all public business entities are required to adopt the guidance in annual reporting periods beginning after Dec. 15, 2026, and interim periods within annual reporting periods beginning after Dec. 15, 2027. Early adoption is still permitted. The amendments may be applied either (1) prospectively to financial statements issued for reporting periods after the effective date of this ASU or (2) retrospectively to all prior periods presented in the financial statements. We are currently evaluating the impact this ASU will have on our disclosures. Reclassification—Certain amounts in the prior year financial statements have been reclassified to conform to the current year presentation. 3. Revenue The following tables present our revenue disaggregated by geographical areas (in thousands): Year Ended December 31, 2025 Primary Geographical Market Number of Hotels Rooms Food and Beverage Other Hotel Other Total Atlanta, GA Area 6 $ 56,210 $ 16,388 $ 5,069 $ — $ 77,667 Dallas / Ft. Worth Area 5 60,832 15,510 5,277 — 81,619 Houston, TX Area 2 19,919 7,597 1,085 — 28,601 Los Angeles, CA Metro Area 4 71,175 18,217 5,791 — 95,183 Miami, FL Metro Area 2 26,408 10,016 1,825 — 38,249 Minneapolis - St. Paul, MN - WI Area 2 13,858 4,763 729 — 19,350 Nashville, TN Area 1 55,131 34,193 5,598 — 94,922 New York / New Jersey Metro Area 4 42,080 15,192 2,435 — 59,707 Orlando, FL Area 2 21,906 1,595 2,010 — 25,511 Philadelphia, PA Area 1 11,706 1,184 1,153 — 14,043 San Diego, CA Area 1 13,096 1,416 753 — 15,265 San Francisco - Oakland, CA Metro Area 3 39,174 5,193 2,137 — 46,504 Tampa, FL Area 2 29,139 6,817 2,336 — 38,292 Washington D.C. - MD - VA Area 9 125,906 23,928 11,860 — 161,694 Other Areas 24 216,534 42,724 19,877 — 279,135 Disposed properties 5 22,549 2,855 1,708 — 27,112 Corporate — — — — 1,534 1,534 Total 73 $ 825,623 $ 207,588 $ 69,643 $ 1,534 $ 1,104,388 94
Page 101
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Year Ended December 31, 2024 Primary Geographical Market Number of Hotels Rooms Food and Beverage Other Hotel Other Total Atlanta, GA Area 6 $ 55,022 $ 16,187 $ 4,106 $ — $ 75,315 Dallas / Ft. Worth Area 5 53,025 15,132 3,808 — 71,965 Houston, TX Area 2 18,801 7,199 780 — 26,780 Los Angeles, CA Metro Area 4 70,594 18,130 5,408 — 94,132 Miami, FL Metro Area 2 25,539 10,167 1,557 — 37,263 Minneapolis - St. Paul, MN - WI Area 2 13,678 4,618 546 — 18,842 Nashville, TN Area 1 55,203 29,182 5,190 — 89,575 New York / New Jersey Metro Area 4 41,012 14,953 2,141 — 58,106 Orlando, FL Area 2 23,442 1,458 2,256 — 27,156 Philadelphia, PA Area 1 11,096 874 932 — 12,902 San Diego, CA Area 1 14,306 1,600 878 — 16,784 San Francisco - Oakland, CA Metro Area 3 37,914 5,445 1,565 — 44,924 Tampa, FL Area 2 30,096 7,024 2,044 — 39,164 Washington D.C. - MD - VA Area 9 133,045 26,844 9,916 — 169,805 Other Areas 24 222,253 43,368 19,106 — 284,727 Disposed properties 27 84,727 10,400 7,567 — 102,694 Corporate — — — — 2,325 2,325 Total 95 $ 889,753 $ 212,581 $ 67,800 $ 2,325 $ 1,172,459 Year Ended December 31, 2023 Primary Geographical Market Number of Hotels Rooms Food and Beverage Other Hotel Other Total Atlanta, GA Area 6 $ 64,566 $ 16,412 $ 3,670 $ — $ 84,648 Dallas / Ft. Worth Area 5 51,384 15,630 3,575 — 70,589 Houston, TX Area 2 19,451 7,972 657 — 28,080 Los Angeles, CA Metro Area 4 70,881 17,855 4,063 — 92,799 Miami, FL Metro Area 2 24,919 8,802 1,141 — 34,862 Minneapolis - St. Paul, MN - WI Area 2 14,024 4,997 718 — 19,739 Nashville, TN Area 1 56,640 28,506 3,678 — 88,824 New York / New Jersey Metro Area 4 40,796 15,364 2,275 — 58,435 Orlando, FL Area 2 23,168 1,621 2,023 — 26,812 Philadelphia, PA Area 1 11,609 1,092 855 — 13,556 San Diego, CA Area 1 12,595 1,307 844 — 14,746 San Francisco - Oakland, CA Metro Area 3 35,816 5,144 1,346 — 42,306 Tampa, FL Area 2 29,571 7,371 1,938 — 38,880 Washington D.C. - MD - VA Area 9 128,047 26,112 8,655 — 162,814 Other Areas 24 229,101 42,264 17,209 — 288,574 Disposed properties 34 246,587 32,380 20,101 — 299,068 Corporate — — — — 2,801 2,801 Total 102 $ 1,059,155 $ 232,829 $ 72,748 $ 2,801 $ 1,367,533 4. Investments in Hotel Properties, net Investments in hotel properties, net consisted of the following (in thousands): December 31, 2025 December 31, 2024 Land $ 410,460 $ 437,567 Buildings and improvements 2,444,715 2,700,234 Furniture, fixtures and equipment 171,635 171,762 Construction in progress 24,937 23,254 Hilton Marietta finance lease 17,269 17,269 Total cost 3,069,016 3,350,086 Accumulated depreciation (983,772) (1,030,879) Investments in hotel properties, net $ 2,085,244 $ 2,319,207 95
Page 102
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) For the years ended December 31, 2025, 2024 and 2023, we recognized depreciation expense of $141.0 million, $152.5 million and $187.4 million, respectively. 5. Dispositions, Impairment Charges and Assets Held For Sale Dispositions On January 10, 2025, the Company completed the sale of the 315-room Courtyard Boston Downtown located in Boston, Massachusetts, for $123.0 million, subject to customary pro rations and adjustments, resulting in a recognized gain of $32.1 million. This gain is reported within “gain (loss) on consolidation of VIE and disposition of assets and hotel properties” in the Company’s consolidated statement of operations. On April 14, 2025, the Residence Inn Orlando sold a parcel of land for $7.2 million, net of selling expenses, resulting in a recognized gain of $6.7 million. This gain is reported within “gain (loss) on consolidation of VIE and disposition of assets and hotel properties” in the Company’s consolidated statements of operations. On May 19, 2025, the Company sold state tax credits held by the Le Méridien Fort Worth for $18.8 million in cash. On August 11, 2025, the Company completed the sale of the 78-room Residence Inn Evansville located in Evansville, Indiana for $6.0 million, subject to customary pro rations and adjustments. On August 22, 2025, the Company completed the sale of the 242-room Hilton Houston NASA Clear Lake located in Houston, Texas for $27.8 million, subject to customary pro rations and adjustments, resulting in a recognized gain of $16.5 million. This gain is reported within “gain (loss) on consolidation of VIE and disposition of assets and hotel properties” in the Company’s consolidated statement of operations. On October 15, 2025, the Company completed the sale of the 150-room Residence Inn San Diego Sorrento Mesa located in San Diego, California, for $42.0 million, subject to customary pro rations and adjustments, resulting in a recognized gain of $23.5 million. This gain is reported within “gain (loss) on consolidation of VIE and disposition of assets and hotel properties” in the Company’s consolidated statement of operations. On December 18, 2025, the Company completed the sale of the 226-room Le Pavillon hotel located in New Orleans, Louisiana for $42.5 million, subject to customary pro rations and adjustments, resulting in a recognized gain of $1.0 million. This gain is reported within “gain (loss) on consolidation of VIE and disposition of assets and hotel properties” in the Company’s consolidated statement of operations. On March 1, 2024, the Company received notice that the hotel properties securing the KEYS Pool A and KEYS Pool B loans have been transferred to a court-appointed receiver. See note 7 for discussion of activity relating to the KEYS Pool A and KEYS Pool B loans. On March 6, 2024, the Company sold the Residence Inn Salt Lake City in Salt Lake City, Utah for $19.2 million in cash. The sale resulted in a gain of approximately $6.9 million for the year ended December 31, 2024, which was included in “gain (loss) on consolidation of VIE and disposition of assets and hotel properties” in the consolidated statements of operations. See note 7. On April 9, 2024, the Company sold the Hilton Boston Back Bay in Boston, Massachusetts for $171 million in cash. The sale resulted in a gain of approximately $129,000 for the year ended December 31, 2024, which was included in “gain (loss) on consolidation of VIE and disposition of assets and hotel properties” in the consolidated statements of operations. See note 7. On April 23, 2024, the Company sold the Hampton Inn Lawrenceville in Lawrenceville, Georgia for $8.1 million in cash. The sale resulted in a gain of approximately $4.8 million for the year ended December 31, 2024, which was included in “gain (loss) on consolidation of VIE and disposition of assets and hotel properties” in the consolidated statements of operations. See note 7. On May 30, 2024, the Company sold the Courtyard Manchester in Manchester, Connecticut for $8.0 million in cash. The sale resulted in a gain of approximately $2.1 million for the year ended December 31, 2024, which was included in “gain (loss) on consolidation of VIE and disposition of assets and hotel properties” in the consolidated statements of operations. See note 7. On June 10, 2024, the Company sold the SpringHill Suites Kennesaw and Fairfield Inn Kennesaw in Kennesaw, Georgia for $17.5 million in cash. The sales resulted in a gain of approximately $9.6 million for the year ended December 31, 2024, 96
Page 103
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) which was included in “gain (loss) on consolidation of VIE and disposition of assets and hotel properties” in the consolidated statements of operations. See note 7. On June 27, 2024, the Company sold the One Ocean Resort and Spa in Atlantic Beach, Florida for $87.0 million in cash. The sale resulted in a gain of approximately $70.9 million for the year ended December 31, 2024, which was included in “gain (loss) on consolidation of VIE and disposition of assets and hotel properties” in the consolidated statements of operations. See note 7. In June 2024, the Company was informed by its lender that the lender intended to exercise remedies for the maturity default on the Ashton hotel in Fort Worth, Texas, which secured the Company’s $8.9 million mortgage loan. The Company and the lender agreed to a deed-in-lieu of foreclosure, which was completed on July 16, 2024 and resulted in a gain on extinguishment of debt of approximately $2.6 million for the year ended December 31, 2024, which was included in “gain (loss) on extinguishment of debt” in the consolidated statement of operations. On August 1, 2023, the Company sold the WorldQuest Resort in Orlando, Florida (“WorldQuest”) for $14.8 million in cash. The sale resulted in a gain of approximately $6.4 million for the year ended December 31, 2023, which was included in “gain (loss) on consolidation of VIE and disposition of assets” in the consolidated statements of operations. On November 9, 2023, the Company sold the Sheraton Bucks County in Langhorne, Pennsylvania for $13.8 million in cash. The sale resulted in a gain of approximately $3.9 million for the year ended December 31, 2023, which was included in “gain (loss) on consolidation of VIE and disposition of assets” in the consolidated statements of operations. On June 9, 2023 the Company received a 30 day extension to satisfy the extension conditions in order to negotiate modifications to the KEYS pool F extension test. On July 7, 2023, the Company elected not to make the required paydown to extend its KEYS pool F loan thereby defaulting on such loan. The KEYS pool F loan had a $215.1 million debt balance and was secured by Embassy Suites Flagstaff, Embassy Suites Walnut Creek, Marriott Bridgewater, Marriott Research Triangle, and the W Atlanta Downtown. On November 29, 2023, the Company completed the deed in lieu of foreclosure transaction for the transfer of ownership of the KEYS F loan to the mortgage lender, which resulted in a gain on extinguishment of debt of approximately $53.4 million for the year ended December 31, 2023, which is included in “gain (loss) on extinguishment of debt” in the consolidated statements of operations. See note 7. 97
Page 104
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) The results of operations for these hotel properties are included in net income (loss) through the date of disposition or derecognition for the years ended December 31, 2025, 2024 and 2023. The following table includes condensed financial information from disposed or derecognized hotel properties for the years ended December 31, 2025, 2024 and 2023 (in thousands): Year Ended December 31, 2025 2024 2023 Total hotel revenue $ 27,112 $ 102,694 $ 314,938 Total hotel operating expenses (21,205) (72,758) (215,729) Property taxes, insurance and other (1,993) (7,691) (19,045) Depreciation and amortization (6,801) (14,363) (45,103) Impairment charges (19,821) — — Total operating expenses (49,820) (94,812) (279,877) Gain (loss) on consolidation of VIE and disposition of assets and hotel properties 73,100 94,406 10,279 Gain (loss) on derecognition of assets 39,054 167,177 — Operating income (loss) 89,446 269,465 45,340 Interest income 86 419 435 Interest expense and amortization of discounts and loan costs (7,227) (23,129) (52,971) Interest expense associated with hotels in receivership (39,038) (45,592) (39,178) Write-off of premiums, loan costs and exit fees (336) (959) (592) Gain (loss) on extinguishment of debt 77 2,774 53,386 Income (loss) before income taxes 43,008 202,978 6,420 (Income) loss before income taxes attributable to redeemable noncontrolling interests in operating partnership(654) (2,385) (73) Net income (loss) attributable to the Company $ 42,354 $ 200,593 $ 6,347 Impairment Charges For the year ended December 31, 2025, we recorded impairment charges of $67.6 million. We recorded impairment charges of $31.5 million, $16.3 million, $18.4 million and $1.4 million for the Hilton Alexandria Old Town, the Hilton Santa Cruz Scotts Valley, the New Orleans Le Pavillon Hotel and the Residence Inn Evansville, respectively. The impairment charges were a result of reduced estimated future cash flows resulting from reductions to the expected holding periods of the hotel properties. The impairment charges for the Residence Inn Evansville, the Hilton Alexandria Old Town, and the New Orleans Le Pavillon Hotel were based on the market approach methodology which compares the net book value of the assets to their fair market value. The impairment charge for the Hilton Santa Cruz Scotts Valley was based on the income approach which utilized a discounted cash flow methodology, supported by the market approach. These valuation techniques are considered Level 3 techniques under the fair value hierarchy. For the year ended December 31, 2024, we recorded impairment charges of $59.3 million. We recorded impairment charges of $35.9 million for the Hilton Costa Mesa and $23.4 million for the Embassy Suites Portland as a result of reduced estimated cash flows resulting from changes to the expected holding periods of these hotel properties. The impairment charges were based on the income approach utilizing a discounted cash flow methodology, supported by the market approach. These valuation techniques are considered Level 3 techniques under the fair value hierarchy. For the year ended December 31, 2023, no impairment charges were recorded. The following table presents the fair value of our hotel properties measured at fair value after the aforementioned non-recurring impairment charges as of December 31, 2025, and the related impairment charge recorded (in thousands): Fair Value as of December 31, 2025 Year Ended December 31, 2025 Level 1 Level 2 Level 3 Total Impairment Charges Hilton Alexandria Old Town $ — $ — $ 60,250 $ 60,250 $ 31,484 (1) Hilton Santa Cruz Scotts Valley $ — $ — $ 22,100 $ 22,100 $ 16,344 (1) The impairment charges were based on the estimated fair value of each applicable hotel property and were recorded during the year ended December 31, 2025.(1) 98
Page 105
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Assets Held For Sale On November 11, 2025, the Company entered into a definitive agreement to sell the 150-room Embassy Suites Houston located in Houston, Texas, and the 150-room Embassy Suites Austin located in Austin, Texas, for a combined purchase price of $27.0 million. The agreement included a nonrefundable deposit of $1.0 million which was paid on November 11, 2025. The Embassy Suites Houston and the Embassy Suites Austin sales closed on February 9, 2026 and February 17, 2026, respectively. See note 25. As of December 31, 2025, these properties were classified as held for sale. As of December 31, 2024, the Courtyard Boston Downtown located in Boston, Massachusetts, which was sold in January 2025, was classified as held for sale. Depreciation and amortization ceased as of the dates the assets were deemed held for sale. Since the sales of these hotels did not represent a strategic shift that has (or will have) a major effect on our operations or financial results, their results of operations were not reported as discontinued operations in the consolidated financial statements. The major classes of assets and liabilities related to assets held for sale included in the consolidated balance sheets were as follows: December 31, 2025 December 31, 2024 Assets Investments in hotel properties, gross $ 34,818 $ 110,295 Accumulated depreciation (17,391) (23,173) Investments in hotel properties, net 17,427 87,122 Cash and cash equivalents 671 15 Restricted cash — 7,858 Accounts receivable, net 127 652 Inventories 45 — Deferred costs, net 10 — Prepaid expenses and other assets 198 583 Due from third-party hotel managers — 398 Assets held for sale $ 18,478 $ 96,628 Liabilities Indebtedness, net $ 38,820 $ 97,368 Accounts payable and accrued expenses 2,044 1,389 Accrued interest 354 364 Due to related parties, net 9 — Due from Ashford Inc. 65 18 Liabilities related to assets held for sale $ 41,292 $ 99,139 6. Investments in Unconsolidated Entities As of December 31, 2025, the Company had invested $9.1 million in an entity that holds the Meritage Investment in Napa, California, and $5.5 million in OpenKey, a consolidated subsidiary of Ashford Inc. Our investments are recorded as a component of “investment in unconsolidated entities” in our consolidated balance sheets and are accounted for under the equity method of accounting as we have been deemed to have significant influence over the entities under the applicable accounting guidance. We review our investments in unconsolidated entities for impairment each reporting period pursuant to the applicable authoritative accounting guidance. An investment is impaired when its estimated fair value is less than the carrying amount of the investment. Any other- than-temporary impairment is recorded in equity in earnings (loss) of unconsolidated entities. In the fourth quarter of 2024, we recorded an impairment charge for our OpenKey investment of approximately $1.0 million, which reduced the carrying value to $0. No impairment charges were recorded on our investments during the years ended December 31, 2025 and 2023. During the 4th quarter of 2025, Ashford Inc., Ashford Trust and Braemar entered into a purchase and sale agreement to sell OpenKey. The transaction closed in January 2026. 99
Page 106
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) The following table summarizes our carrying value in unconsolidated entities: December 31, 2025 December 31, 2024 Carrying value of the Meritage Investment (in thousands) $ 7,265 $ 7,590 The following table summarizes our equity in earnings (loss) of unconsolidated entities (in thousands): Year Ended December 31, 2025 2024 2023 OpenKey $ — $ (566) $ (528) Meritage Investment (325) (795) (606) $ (325) $ (1,361) $ (1,134) 7. Indebtedness, net Indebtedness consisted of the following (in thousands): December 31, 2025 December 31, 2024 Indebtedness Collateral Maturity Interest Rate Debt BalanceBook Value ofCollateral Debt BalanceBook Value ofCollateral Mortgage loan 2hotels February 2025 4.45 % $ — $ — $ 25,882 $ 38,627 Mortgage loan 1hotel March 2025 4.66 % 21,971 22,146 22,132 40,276 Mortgage loan 4hotels June 2025 SOFR + 4.03 % — — 143,877 122,603 Mortgage loan 4hotels June 2025 SOFR + 4.29 % — — 159,424 62,801 Mortgage loan 5hotels June 2025 SOFR + 3.02 % — — 109,473 151,592 Mortgage loan 1hotel December 2025 SOFR + 4.00 % — — 37,000 63,633 Term loan Equity January 2026 14.00 % — — 44,722 — Mortgage loan 18hotels January 2026 SOFR + 4.15 % 733,625 771,949 862,027 881,867 Mortgage loan 8hotels February 2026 SOFR + 3.28 % 325,000 222,776 325,000 235,655 Mortgage loan 1hotel February 2026 SOFR + 2.85 % 12,330 20,699 12,330 21,565 Mortgage loan 14hotels March 2026 SOFR + 3.83 % 341,203 198,713 409,750 232,485 Mortgage loan 2hotels May 2026 SOFR + 4.00 % 98,450 104,086 98,450 139,244 Mortgage loan 16hotels February 2027 SOFR + 4.37 % 580,000 420,162 — — Mortgage loan 1hotel September 2027 SOFR + 2.26 % 218,100 142,041 267,200 148,488 Mortgage loan 1hotel November 2027 SOFR + 4.75 % 121,500 75,011 121,500 77,165 Mortgage loan 4hotels December 2028 8.51 % 30,200 32,198 30,200 35,792 Preferred investment 1hotel May 2029 11.14 % 88,845 — — — Bridge loan 1hotel September 2025 7.75 % — — 20,898 — Construction loan 1hotel May 2033 11.26 % 15,660 77,229 15,785 93,219 Total indebtedness $ 2,586,884 $ 2,087,010 $ 2,705,650 $ 2,345,012 Premiums (discounts), net 301 331 Capitalized default interest and late charges 2,346 36 Deferred loan costs, net (24,103) (8,459) Embedded debt derivative — 29,099 Indebtedness, net $ 2,565,428 $ 2,726,657 Indebtedness, net related to assets held forsale 1hotel August 2025 SOFR + 3.91 % — 97,368 Indebtedness, net related to assets held forsale 2hotels March 2026 SOFR + 3.83 % 38,820 — $ 2,526,608 $ 2,629,289 _____________________________ SOFR rates were 3.69% and 4.33% at December 31, 2025 and December 31, 2024, respectively. On February 12, 2025, this mortgage loan was refinanced into a new $580.0 million mortgage loan. The new mortgage loan is interest only and bears interest at a rate of SOFR + 4.37%, has a two-year initial term, and has three one-year extension options, subject to the satisfaction of certain conditions. (2) (3) (2) (1) (2) (1) (2) (1) (4) (1) (5) (6) (1) (7) (1) (8) (1) (9) (1) (10) (1) (2) (1) (11) (1) (12) (1) (13) (14) (15) (14) (5) (6) (1) (9) (1) (1) (2) 100
Page 107
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) As of December 31, 2025, this mortgage loan was in default under the terms and conditions of the mortgage loan agreement. Default interest of 5.00% was accrued in addition to the stated interest rate, in accordance with the terms of the mortgage loan agreement, and is reflected in the Company’s consolidated balance sheet and statement of operations. On December 18, 2025, we repaid this mortgage loan in conjunction with the sale of Le Pavillon. See note 5. On February 12, 2025, we repaid this term loan including the $30.0 million exit fee. In January 2025, this mortgage loan was paid down $118.4 million in conjunction with the sale of the Courtyard Boston Downtown. On July 30, 2025, this mortgage loan was amended. Terms of the amendment included a $10.0 million principal paydown, extending the current maturity date to January 2026, and adding one six-month extension option, subject to the satisfaction of certain conditions. The six-month extension period began in January 2026, and included a $10.0 million principal paydown and increased the interest rate to SOFR + 4.41%. This mortgage loan has six one-year extension options, subject to satisfaction of certain conditions. The sixth one-year extension period began in February 2025, subject to satisfaction of certain conditions which must be completed by February 9, 2026. On February 9, 2026, this mortgage loan went into default under the terms and conditions of the mortgage loan agreement and began incurring default interest of 5.00% in addition to the stated interest rate, in accordance with the terms and conditions of the mortgage loan agreement. On February 24, 2025, we amended this mortgage loan. Terms of the amendment included extending the current maturity date to February 2026, and adding one one-year extension option, subject to satisfaction of certain conditions. The one-year extension period began in February 2026. On April 9, 2025, this mortgage loan was amended. Terms of the amendment included extending the maturity date to March 2026, and adding two one-year extension options, subject to the satisfaction of certain conditions. In August 2025, this mortgage loan was paid down $31.4 million in conjunction with the sales of the Residence Inn Evansville and the Hilton Houston NASA Clear Lake. In October 2025, this mortgage loan was paid down an additional $37.1 million in conjunction with the sale of the Residence Inn San Diego Sorrento Mesa. Subsequent to December 31, 2025, this mortgage loan was paid down $111.1 million in conjunction with the sales of the Hilton St. Petersburg Bayfront, the Embassy Suites Austin and the Embassy Suites Houston. Additionally, in March of 2026, we exercised the first one-year extension option. This mortgage loan has two one-year extension options, subject to satisfaction of certain conditions. This mortgage loan has a SOFR floor of 0.50%. Subsequent to December 31, 2025, we paid down $56.0 million in principal on this mortgage loan in conjunction with the sale of the La Posada de Santa Fe. On September 9, 2025, we amended this mortgage loan. Terms of the amendment included a principal reduction to $218.1 million, a reduction in the interest rate to SOFR + 2.26%, extending the current maturity to September 2027, and adding three, one-year extension options, subject to satisfaction of certain conditions. This mortgage loan has two one-year extension options, subject to satisfaction of certain conditions. This mortgage loan has a SOFR floor of 2.75%. On May 8, 2025, we received $35.0 million in return for a preferred equity investment in the Renaissance Hotel in Nashville, Tennessee. The holder was entitled to a preferred return of 14.0% per annum. On September 9, 2025, we received an additional $53.0 million increasing the preferred equity investment in the property and the return on the preferred equity investment was decreased from 14.0% per annum to 11.14% per annum. The investment is mandatorily redeemable on May 10, 2029 and is recorded within indebtedness, net in the Company’s consolidated balance sheet as required under GAAP. This loan is associated with 815 Commerce Managing Member, LLC. See discussion in notes 2 and 8. On August 14, 2025, we repaid this bridge loan. We recognized net premium (discount) amortization as presented in the table below (in thousands): Year Ended December 31, Line Item 2025 2024 2023 Interest expense and amortization of discounts and loan costs $ 29 $ (913) $ (18,684) The amortization of the net premium (discount) is computed using a method that approximates the effective interest method. During the year ended December 31, 2025, the Company capitalized $14.1 million of default interest and late charges related to our Highland Pool mortgage loan and Morgan Stanley Pool mortgage loan upon the refinancing of the loans. The amount of the capitalized principal that was amortized during the year ended December 31, 2025 was $11.4 million, During the years ended December 31, 2021 and 2020, the Company entered into forbearance and other agreements which were evaluated to be considered troubled debt restructurings due to terms that allowed for deferred interest and the forgiveness of default interest and late charges. The amount of capitalized principal that was amortized during the years ended December 31, 2024 and 2023 was $352,000 and $7.8 million, respectively. All accrued default interest and late charges were capitalized into the principal balance and are amortized over the remaining initial term of the mortgage loans using the effective interest method. The amount of capitalized principal that was written off during the years ended December 31, 2025, 2024 and 2023 was $333,000, $8,000, and $151,000, respectively. These amounts are included as a reduction to “interest expense and amortization of discounts and loan costs” in the consolidated statements of operations. Amendments to the Oaktree Credit Agreement (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) 101
Page 108
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) On June 21, 2023, the Company and Ashford Trust OP (the “Borrower”), an indirect subsidiary of the Company, entered into Amendment No. 2 to the Credit Agreement (“Amendment No. 2”) with certain funds and accounts managed by Oaktree Capital Management, L.P. (the “Lenders”) and Oaktree Fund Administration, LLC. On March 11, 2024, we entered into Amendment No. 3 to the Oaktree Credit Agreement which, among other items, (i) extended the Credit Agreement to January 15, 2026, (ii) removed the $50 million minimum cash requirement, (iii) removed the 3% increase in the interest rate if cash is below $100 million, (iv) removed the provision in which a default under mortgage indebtedness is a default under the Credit Agreement, and (v) increased the interest rate by 3.5% if the principal balance is not less than $100 million as of September 30, 2024 or not fully repaid by March 31, 2025. On February 12, 2025, we repaid the outstanding balance on the Oaktree Credit Agreement and the associated $30.0 million exit fee. Derecognition of Assets The KEYS mortgage loans were entered into on June 13, 2018, each of which had a two-year initial term and five one-year extension options. In order to qualify for a one-year extension in June of 2023, each KEYS loan pool was required to achieve a certain debt yield test. The Company extended its KEYS Pool C loan with a paydown of approximately $62.4 million, its KEYS Pool D loan with a paydown of approximately $25.6 million, and its KEYS Pool E loan with a paydown of approximately $41.0 million. On July 7, 2023, the Company elected not to make the required paydowns to extend its KEYS Pool A loan, KEYS Pool B loan and KEYS Pool F loan thereby defaulting on such loans. On November 29, 2023, the Company completed the deed in lieu of foreclosure transaction for the transfer of ownership of the KEYS Pool F $215.1 million mortgage to the mortgage lender. On March 1, 2024, the Company received notice that the hotel properties that secured the KEYS Pool A and KEYS Pool B loans have been transferred to a court-appointed receiver. Below is a summary of the hotel properties that secured the KEYS Pool A and Pool B loans: KEYS A Loan Pool Courtyard Columbus Tipton Lakes – Columbus, IN Courtyard Old Town – Scottsdale, AZ Residence Inn Hughes Center – Las Vegas, NV Residence Inn Phoenix Airport – Phoenix, AZ Residence Inn San Jose Newark – Newark, CA SpringHill Suites Manhattan Beach – Hawthorne, CA SpringHill Suites Plymouth Meeting – Plymouth Meeting, PA KEYS B Loan Pool Courtyard Basking Ridge – Basking Ridge, NJ Courtyard Newark Silicon Valley – Newark, CA Courtyard Oakland Airport – Oakland, CA Courtyard Plano Legacy Park – Plano, TX Residence Inn Plano – Plano, TX SpringHill Suites BWI Airport – Baltimore, MD TownePlace Suites Manhattan Beach – Hawthorne, CA We derecognized the hotel properties that secured the KEYS Pool A and KEYS Pool B loans from our consolidated balance sheet in March 2024, when the receiver took control of the hotel properties and, accordingly, recognized a gain of $133.9 million, which is included in “gain (loss) on derecognition of assets” in our consolidated statements of operations for the three months ended March 31, 2024. We recorded a contract asset of $378.2 million as of March 31, 2024, which represented the liabilities from which we expect to be released upon final resolution with the lenders on the KEYS Pool A and KEYS Pool B mortgage loans in exchange for the transfer of ownership of the respective hotel properties. Subsequent to March 31, 2024, we recognized an additional gain of $33.3 million, which is included in “gain (loss) on derecognition of assets” in our consolidated statement of operations that increased the contract asset by a corresponding amount. The additional gain primarily represents the additional accrued interest expense recorded through December 31, 2024. In total for the year ended December 31, 2024, we recognized a gain of $167.2 million. 102
Page 109
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) On July 2, 2024, the Courtyard Plano Legacy Park and the Residence Inn Plano were foreclosed on at a public auction. Additionally, on November 4, 2024, the receiver appointed for the KEYS Pool A and KEYS Pool B mortgage loans transferred the Courtyard Columbus Tipton Lakes to a third-party purchaser. As a result, the contract asset and corresponding indebtedness associated with hotels in receivership and accrued interest associated with hotels in receivership were reduced by $45.0 million for the amounts attributable to each hotel as of December 31, 2024. For the year ended December 31, 2025, we recognized an additional gain of $39.1 million, which was included in “gain (loss) on derecognition of assets” in our consolidated statement of operations that increased the contract asset by a corresponding amount. The KEYS Pool A and the KEYS Pool B mortgage loans, as well as all accrued and unpaid interest, default charges and late fees will remain liabilities until final resolution with the lenders is concluded, and thus are included in “indebtedness associated with hotels in receivership” and “accrued interest associated with hotels in receivership” on our consolidated balance sheets. On June 25, 2025 and December 22, 2025, the receiver appointed for the KEYS Pool A and KEYS Pool B mortgage loans transferred the Courtyard Oakland and SpringHill Suites BWI Airport to a third-party purchaser. As a result, the contract asset and corresponding indebtedness associated with hotels in receivership and accrued interest associated with hotels in receivership were reduced by $50.6 million for the amounts attributable to each hotel as of December 31, 2025. On March 4, 2026, the receiver appointed for the KEYS Pool A and KEYS Pool B mortgage loans transferred the SpringHill Suites Plymouth Meeting to a third-party purchaser. Other In June 2024, the Company was informed by its lender that the lender intended to exercise remedies for the maturity default on the Ashton hotel in Fort Worth, Texas, which secured the Company’s $8.9 million mortgage loan. The Company and the lender agreed to a deed-in-lieu of foreclosure, which was completed on July 16, 2024. In conjunction with the development of the Le Meridien in Fort Worth, Texas, which was consolidated as of May 31, 2023, the Company recorded $3.7 million and $3.0 million of capitalized interest, respectively, for the years ended December 31, 2024 and 2023. These amounts are included in “investment in hotel properties, net” in our consolidated balance sheets. The hotel opened on August 29, 2024. On March 6, 2025, the $22.1 million non-recourse mortgage loan secured by the Hilton Santa Cruz Scotts Valley reached final maturity and was not repaid, resulting in a default under the terms and conditions of the mortgage loan agreement. We have extension options relating to certain property-level loans that will permit us to extend the maturity date of our loans if certain conditions are satisfied at the respective extension dates, including the achievement of debt yield targets required in order to extend such loans. To the extent we decide to extend the maturity date of the debt outstanding under the loans, we may be required to prepay a significant amount of the loans in order to meet the required debt yield. If we violate covenants in our debt agreements, we could be required to repay all or a portion of our indebtedness before maturity at a time when we might be unable to arrange financing for such repayment on attractive terms, if at all. As of December 31, 2025, we were in compliance with all covenants related to mortgage loans, except where noted above. The assets of certain of our subsidiaries are pledged under non-recourse indebtedness and are not available to satisfy the debts and other obligations of Ashford Trust or Ashford Trust OP, our operating partnership, and the liabilities of such subsidiaries do not constitute the obligations of Ashford Trust or Ashford Trust OP. With respect to upcoming maturities, no assurances can be given that we will be able to refinance our upcoming maturities. Additionally, no assurances can be given that we will obtain additional financings or, if we do, what the amount and terms will be. Our failure to obtain future financing under favorable terms could adversely impact our ability to execute our business strategy or may result in lender foreclosure. 103
Page 110
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Maturities and scheduled amortizations of indebtedness as of December 31, 2025 for each of the five following years and thereafter are as follows (in thousands), excluding extension options: 2026 $ 1,532,727 2027 919,766 2028 30,381 2029 89,054 2030 233 Thereafter 14,723 Total $ 2,586,884 8. Note Receivable The Company has a note receivable with the manager of 815 Commerce MM, who also holds a non-controlling interest in 815 Commerce MM. See discussion in note 2. The note receivable is payable within 30 days after demand. If the manager fails upon demand to repay the note receivable with interest, the Company will have the right to convert the unpaid principal plus all accrued interest thereon to an additional capital contribution, in which case the deemed additional capital contributions by the manager will be deemed to have not occurred and the percentage interests and the residual sharing percentages of the members shall be adjusted. The note receivable may be prepaid in whole or in part. The following table summarizes the note receivable (dollars in thousands): Interest Rate December 31, 2025 December 31, 2024 Note receivable 18.0 % $ 12,187 $ 10,565 _____________________________ As of December 31, 2025, the Company’s note receivable balance consists of advances of $8.9 million and accrued interest of $3.3 million. The following table summarizes the interest income associated with the note receivable (in thousands): Year Ended December 31, Line Item 2025 2024 2023 Interest income $ 1,596 $ 1,218 $ 501 9. Derivative Instruments and Hedging Interest Rate Derivatives—We are exposed to risks arising from our business operations, economic conditions and financial markets. To manage these risks, we primarily use interest rate derivatives to hedge our debt and our cash flows, which include interest rate caps and floors. To mitigate nonperformance risk, we routinely use a third party’s analysis of the creditworthiness of the counterparties, which supports our belief that the counterparties’ nonperformance risk is limited. All derivatives are recorded at fair value. Payments from counterparties on in-the-money interest rate caps and floors are recognized as realized gains on our consolidated statements of operations. (1) (1) 104
Page 111
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) The following table presents a summary of our interest rate derivatives entered into over each applicable period: Year Ended December 31, 2025 2024 2023 Interest rate caps: Notional amount (in thousands)$ 1,642,505 $ 2,341,742 $ 2,583,271 Strike rate low end of range 4.00 % 3.10 % 2.50 % Strike rate high end of range 5.25 % 7.31 % 6.90 % Effective date range February 2025 - September 2025 February 2024 - December 2024 March 2023 - December 2023 Termination date range January 2026 - September 2027 February 2025 - November 2027 February 2024 - June 2025 Total cost (in thousands) $ 5,120 $ 15,532 $ 28,256 Interest rate floors: Notional amount (in thousands)$ — $ 121,500 $ — Strike rate low end of range — % 2.75 % — % Strike rate high end of range — % 2.75 % — % Effective date range November 2024 Termination date range November 2027 Total cost (in thousands) $ — $ 754 $ — _______________ These instruments were not designated as cash flow hedges. We held interest rate instruments as summarized in the table below: December 31, 2025 December 31, 2024 Interest rate caps: Notional amount (in thousands) $ 2,068,205 $ 2,477,192 Strike rate low end of range 4.00 % 3.10 % Strike rate high end of range 5.50 % 7.31 % Termination date range January 2026 - November 2027 January 2025 - November 2027 Aggregate principal balance on corresponding mortgage loans (inthousands) $ 1,764,005 $ 2,123,951 Interest rate floors: Notional amount (in thousands) $ 121,500 $ 121,500 Strike rate low end of range 2.75 % 2.75 % Strike rate high end of range 2.75 % 2.75 % Termination date range November 2027 November 2027 _______________ These instruments were not designated as cash flow hedges. Compound Embedded Debt Derivative—On February 12, 2025, we repaid the outstanding balance on our corporate strategic financing with Oaktree Capital Management, L.P. (the “Oaktree Credit Agreement”), which included an exit fee of $30.0 million. Prior to the repayment date, the exit fee was considered under the applicable accounting guidance as an embedded derivative liability that met the criteria for bifurcation from the debt host and was measured at estimated fair value at each reporting period. See note 10. 10. Fair Value Measurements Fair Value Hierarchy—For disclosure purposes, financial instruments, whether measured at fair value on a recurring or nonrecurring basis or not measured at fair value, are classified in a hierarchy consisting of three levels based on the observability of valuation inputs in the marketplace as discussed below: • Level 1: Fair value measurements that are quoted prices (unadjusted) in active markets that we have the ability to access for identical assets or liabilities. Market price data generally are obtained from exchange or dealer markets. (1) (1) (1) (1) (1) (1) (1) (1) (1) (1) 105
Page 112
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) • Level 2: Fair value measurements based on inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves that are observable at commonly quoted intervals. • Level 3: Fair value measurements based on valuation techniques that use significant inputs that are unobservable. The circumstances for using these measurements include those in which there is little, if any, market activity for the asset or liability. The fair value of interest rate caps and floors is determined using the market standard methodology of discounting the future expected cash receipts that would occur if variable interest rates fall below the strike rates of the floors or rise above the strike rates of the caps. Variable interest rates used in the calculation of projected receipts and payments on the caps are based on an expectation of future interest rates derived from observable market interest rate curves (SOFR forward curves) and volatilities (Level 2 inputs). We also incorporate credit valuation adjustments (Level 3 inputs) to appropriately reflect both our own nonperformance risk and the respective counterparty’s nonperformance risk. When a majority of the inputs used to value our derivatives fall within Level 2 of the fair value hierarchy, the derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy. However, when valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default by us and our counterparties, which we consider significant (10% or more) to the overall valuation of our derivatives, the derivative valuations in their entirety are classified in Level 3 of the fair value hierarchy. Transfers of inputs between levels are determined at the end of each reporting period. In determining the fair values of our derivatives at December 31, 2025, the SOFR interest rate forward curve (Level 2 inputs) assumed a downtrend from 3.688% to 3.104% for the remaining term of our derivatives. Credit spreads (Level 3 inputs) used in determining the fair values of derivatives assumed an uptrend in nonperformance risk for us and all of our counterparties through the maturity dates. The Company initially recorded an embedded debt derivative of $43.7 million, which was attributed to the compound embedded derivative liability associated with the Oaktree term loan until the Company’s repayment of the Oaktree term loan on February 12, 2025. The compound embedded derivative liability was considered a Level 3 measurement due to the utilization of significant unobservable inputs in the valuation, which were based on ‘with and without’ valuation models. Based on the terms and provisions of the Oaktree Credit Agreement, with the assistance of a valuation specialist, the Company utilized a risk neutral model to estimate the fair value of the embedded derivative features requiring bifurcation as of the respective issuance dates. The risk neutral model was designed to utilize market data and the Company’s best estimate of the timing and likelihood of the settlement events that were related to the embedded derivative features in order to estimate the fair value of the respective notes with these embedded derivative features. The fair value of the notes with the derivative features was compared to the fair value of a plain vanilla note (excluding the derivative features), which was calculated based on the present value of the future default adjusted expected cash flows. The difference between the two values represented the fair value of the bifurcated derivative features as of each respective valuation date. The following table includes a summary of the compound embedded derivative liabilities measured at fair value using significant unobservable (Level 3) inputs (in thousands): Fair Value Balance at December 31, 2022 $ 23,687 Re-measurement of fair value 9 Balance at December 31, 2023 23,696 Re-measurement of fair value 5,403 Balance at December 31, 2024 29,099 Re-measurement of fair value 901 Payment of derivative liability (30,000) Balance at December 31, 2025 $ — 106
Page 113
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Assets and Liabilities Measured at Fair Value on a Recurring Basis The following table presents our assets and liabilities measured at fair value on a recurring basis aggregated by the level within which measurements fall in the fair value hierarchy (in thousands): Quoted MarketPrices (Level 1) Significant OtherObservable Inputs(Level 2) SignificantUnobservableInputs (Level 3) Total December 31, 2025: Assets Derivative assets: Interest rate derivatives – floors $ — $ 177 $ — $ 177 Interest rate derivatives – caps — 233 — 233 Total $ — $ 410 $ — $ 410 December 31, 2024: Assets Derivative assets: Interest rate derivatives – floors $ — $ 434 $ — $ 434 Interest rate derivatives – caps — 2,160 — 2,160 Total $ — $ 2,594 $ — $ 2,594 Liabilities Embedded debt derivative $ — $ — $ (29,099) $ (29,099) Net $ — $ 2,594 $ (29,099) $ (26,505) ____________________________________ Reported as “derivative assets” in our consolidated balance sheets. Reported in “indebtedness, net” in our consolidated balance sheets. Effect of Fair Value Measured Assets and Liabilities on Consolidated Statements of Operations The following table summarizes the effect of fair value measured assets and liabilities on our consolidated statements of operations (in thousands): Gain (Loss) Recognized in Income Year Ended December 31, 2025 2024 2023 Assets Derivative assets: Interest rate derivatives - floors $ (257) $ (320) $ — Interest rate derivatives - caps (4,188) (757) (2,191) (4,445) (1,077) (2,191) Liabilities Derivative liabilities: Embedded debt derivative (901) (5,403) (9) Net $ (5,346) $ (6,480) $ (2,200) Total combined Interest rate derivatives - floors $ (257) $ (320) $ — Interest rate derivatives - caps (5,363) (27,067) (44,032) Embedded debt derivative (901) (5,403) (9) Unrealized gain (loss) on derivatives (6,521) (32,790) (44,041) Realized gain (loss) on interest rate caps 1,175 26,310 41,841 Net $ (5,346) $ (6,480) $ (2,200) ____________________________________ Reported in “realized and unrealized gain (loss) on derivatives” in our consolidated statements of operations. Represents settled and unsettled payments from counterparties on interest rate caps. (1) (1) (2) (1) (2) (1) (1) (1) (1) (2) (1) (2) (1) (2) (1) (2) 107
Page 114
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) 11. Summary of Fair Value of Financial Instruments Determining estimated fair values of our financial instruments, such as notes receivable and indebtedness, requires considerable judgment to interpret market data. Market assumptions and/or estimation methodologies used may have a material effect on estimated fair value amounts. Accordingly, estimates presented are not necessarily indicative of amounts at which these instruments could be purchased, sold or settled. Carrying amounts and estimated fair values of financial instruments, for periods indicated, were as follows (in thousands): December 31, 2025 December 31, 2024 Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value Financial assets measured at fair value: Derivative assets $ 410 $ 410 $ 2,594 $ 2,594 Financial liabilities measured at fair value: Embedded debt derivative $ — $ — $ 29,099 $ 29,099 Financial assets not measured at fair value : Cash and cash equivalents $ 66,816 $ 66,816 $ 112,922 $ 112,922 Restricted cash 149,580 149,580 107,553 107,553 Accounts receivable, net 32,879 32,879 36,231 36,231 Notes receivable, net 12,187 12,187 10,565 10,565 Due from third-party hotel managers 25,667 25,667 21,604 21,604 Financial liabilities not measured at fair value : Indebtedness $ 2,587,185 $ 2,587,088 $ 2,705,981 $ 2,695,013 Indebtedness associated with hotels in receivership 272,800 229,172 314,640 257,546 Accounts payable and accrued expenses 125,817 125,817 138,895 138,895 Accrued interest payable 14,347 14,347 10,576 10,576 Accrued interest associated with hotels in receivership 82,338 82,338 52,031 52,031 Dividends and distributions payable 4,247 4,247 3,952 3,952 Due to Ashford Inc., net 40,708 40,708 25,653 25,653 Due to related parties, net 1,958 1,958 2,850 2,850 Due to third-party hotel managers 882 882 1,145 1,145 ____________________________________ Includes balances associated with assets held for sale and liabilities associated with assets held for sale as of December 31, 2025 and December 31, 2024. Cash, cash equivalents and restricted cash. These financial assets bear interest at market rates and have original maturities of less than 90 days. The carrying value approximates fair value due to their short-term nature. This is considered a Level 1 valuation technique. Accounts receivable, net, accounts payable and accrued expenses, accrued interest payable, accrued interest associated with hotels in receivership, dividends and distributions payable, due to/from related parties, net, due to/from Ashford Inc., net and due to/from third-party hotel managers. The carrying values of these financial instruments approximate their fair values due to their short-term nature. This is considered a Level 1 valuation technique. Notes receivable, net. The carrying amount of notes receivable, net approximates its fair value. This is considered a Level 2 valuation technique. Derivative assets and embedded debt derivative. See notes 7 and 10 for a complete description of the methodology and assumptions utilized in determining fair values. Indebtedness and indebtedness associated with hotels in receivership. Fair value of indebtedness is determined using the loan terms, collateral value and financial data such as loan-to-value ratios, debt service coverage ratios, and interest rates for comparable loans. We estimated the fair value of total indebtedness to be approximately 100.0% of the carrying value of $2.6 billion at December 31, 2025 and approximately 99.6% of the carrying value of $2.7 billion at December 31, 2024. We estimated the fair value of indebtedness associated with hotels in receivership to be approximately 84.0% of the carrying value of $272.8 million at December 31, 2025 and approximately 81.9% of the carrying value of $314.6 million at December 31, 2024. These fair value estimates are considered a Level 2 valuation technique. (1) (1) (1) 108
Page 115
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) 12. Income (Loss) Per Share Basic income (loss) per common share is calculated using the two-class method by dividing net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding during the period. Diluted income (loss) per common share is calculated using the two-class method, or treasury stock method if more dilutive, and reflects the potential dilution that could occur if securities or other contracts to issue common shares were exercised or converted into common shares, whereby such exercise or conversion would result in lower income per share. The following table reconciles the amounts used in calculating basic and diluted income (loss) per share (in thousands, except per-share amounts): Year Ended December 31, 2025 2024 2023 Income (loss) allocated to common stockholders – basic and diluted: Income (loss) attributable to the Company $ (179,839) $ (60,300) $ (178,489) Less: dividends on preferred stock (28,216) (22,686) (15,921) Less: deemed dividends on redeemable preferred stock (6,949) (2,906) (2,673) Add: gain (loss) on extinguishment of preferred stock — 3,370 3,390 Distributed and undistributed income (loss) allocated to common stockholders – basic and diluted $ (215,004) $ (82,522) $ (193,693) Weighted average common shares outstanding: Weighted average shares outstanding – basic and diluted 5,974 4,706 3,452 Basic income (loss) per share: Net income (loss) allocated to common stockholders per share $ (35.99) $ (17.54) $ (56.11) Diluted income (loss) per share: Net income (loss) allocated to common stockholders per share $ (35.99) $ (17.54) $ (56.11) 109
Page 116
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Due to their anti-dilutive effect, the computation of diluted income (loss) per share does not reflect adjustments for the following items (in thousands): Year Ended December 31, 2025 2024 2023 Income (loss) allocated to common stockholders is not adjusted for: Income (loss) attributable to redeemable noncontrolling interests in operating partnership (3,262) 683 $ (2,239) Dividends on preferred stock – Series J (inclusive of deemed dividends) 18,609 13,276 6,014 Dividends on preferred stock – Series K (inclusive of deemed dividends) 1,757 1,169 317 Dividends on preferred stock – Series L (inclusive of deemed dividends) 1,280 — — Dividends on preferred stock – Series M (inclusive of deemed dividends) 2,663 — — Total $ 21,047 $ 15,128 $ 4,092 Weighted average diluted shares are not adjusted for: Effect of unvested restricted stock 7 7 — Effect of assumed conversion of operating partnership units 97 64 42 Effect of assumed issuance of shares for term loan exit fee — — 175 Effect of assumed conversion of preferred stock – Series J 32,856 15,713 1,693 Effect of assumed conversion of preferred stock – Series K 3,137 1,187 93 Effect of assumed conversion of preferred stock – Series L 524 — — Effect of assumed conversion of preferred stock – Series M 1,084 — — Total 37,705 16,971 2,003 13. Redeemable Noncontrolling Interests in Operating Partnership Redeemable noncontrolling interests in the operating partnership represents the limited partners’ proportionate share of equity in earnings/losses of the operating partnership, which is an allocation of net income/loss attributable to the common unit holders based on the weighted average ownership percentage of these limited partners’ common units of limited partnership interest in the operating partnership (the “common units”) and the units issued under our LTIP units that are vested. Each common unit may be redeemed for either cash or, at our sole discretion, up to one share of our REIT common stock, which is either: (i) issued pursuant to an effective registration statement; (ii) included in an effective registration statement providing for the resale of such common stock; or (iii) issued subject to a registration rights agreement. LTIP units, which are issued to certain executives and employees of Ashford LLC as compensation, generally have vesting periods of three years. Additionally, certain independent members of the board of directors have elected to receive LTIP units as part of their compensation, which are fully vested upon grant. Upon reaching economic parity with common units, each vested LTIP unit can be converted by the holder into one common unit which can then be redeemed for cash or, at our election, settled in our common stock. An LTIP unit will achieve parity with the common units upon the sale or deemed sale of all or substantially all of the assets of the operating partnership at a time when our stock is trading at a level in excess of the price it was trading on the date of the LTIP issuance. More specifically, LTIP units will achieve full economic parity with common units in connection with (i) the actual sale of all or substantially all of the assets of the operating partnership or (ii) the hypothetical sale of such assets that results from a capital account revaluation, as defined in the partnership agreement, for the operating partnership. The compensation committee of the board of directors of the Company may authorize the issuance of Performance LTIP units to certain executive officers and directors from time to time. The award agreements provide for the grant of a target number of Performance LTIP units that will be settled in common units of Ashford Trust OP, if, when and to the extent the applicable vesting criteria have been achieved following the end of the performance and service period. The criteria for the Performance LTIP units are based on performance conditions and market conditions under the relevant literature. The corresponding compensation cost is recognized, based on the applicable measurement date fair value of the award, ratably over the service period for the award as the service is rendered, which may vary from period to period, as the number of performance grants earned may vary based on the estimated probable achievement of certain performance targets (performance conditions). The number of Performance LTIP units to be earned based on the applicable performance conditions is determined upon the final vesting date. The initial calculation of the Performance LTIP units earned can range from 0% to 200% of target, which is 110
Page 117
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) further subjected to a specified absolute total stockholder return modifier (market condition) based on the formulas determined by the Company’s compensation committee on the grant date. This will result in an adjustment (75% to 125%) of the initial calculation of the number of performance awards earned based on the applicable performance targets resulting in a final award calculation ranging from 0% to 250% of the target amount. During the year ended December 31, 2025, Performance LTIPs granted in 2023 vested at 19% of target based on the performance conditions met over the performance period. As of December 31, 2025, there are approximately 69,000 issued and outstanding LTIP and Performance LTIP units. All LTIP and Performance LTIP units, other than approximately 22,000 LTIP and 35,000 Performance LTIP units, had reached full economic parity with, and are convertible into, common units. We recorded compensation expense for Performance LTIP units and LTIP units as presented in the table below (in thousands): Year Ended December 31, Type Line Item 2025 2024 2023 Performance LTIP units Advisory services fee $ (348) $ 926 $ 783 LTIP units Advisory services fee — 86 435 LTIP units Corporate, general and administrative — 4 15 LTIP units - independent directors Corporate, general and administrative — 135 475 $ (348) $ 1,151 $ 1,708 The following table presents the redeemable noncontrolling interests in Ashford Trust OP and the corresponding approximate ownership percentage: December 31, 2025 December 31, 2024 Redeemable noncontrolling interests in Ashford Trust OP (in thousands) $ 20,516 $ 22,509 Cumulative adjustments to redeemable noncontrolling interests (in thousands) $ 187,846 $ 186,235 Ownership percentage of operating partnership 1.43 % 1.02 % ____________________________________ Reflects the excess of the redemption value over the accumulated historical costs. We allocated net (income) loss to the redeemable noncontrolling interests as presented in the table below (in thousands): Year Ended December 31, 2025 2024 2023 Net (income) loss attributable to redeemable noncontrolling interests in operating partnership $ 3,262 $ 683 $ 2,239 A summary of the activity of the units in our operating partnership is as follow (in thousands): Year Ended December 31, 2025 2024 2023 Outstanding at beginning of year 121 198 167 LTIP units issued — 10 11 Performance LTIP units issued — — 28 Performance LTIP units canceled (26) (87) (8) Outstanding at end of year 95 121 198 Common units convertible/redeemable at end of year 37 38 36 14. Equity Common Stock and Preferred Stock Repurchases—On April 6, 2022, the board of directors reapproved a stock repurchase program (the “2022 Repurchase Program”) pursuant to which the board of directors granted a repurchase authorization to acquire shares of the Company’s common stock, par value $0.01 per share and preferred stock having an aggregate value of up to $200 million. The board of directors’ authorization replaced any previous repurchase authorizations. (1) (1) 111
Page 118
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) For the years ended December 31, 2025, 2024 and 2023, no shares of our common stock or preferred stock have been repurchased under the Repurchase Program. In addition, we acquired approximately 7,000, 3,000 and 3,000 shares of our common stock in 2025, 2024 and 2023, respectively, to satisfy employees’ statutory minimum U.S. federal income tax obligations in connection with vesting of equity grants issued under our stock-based compensation plan. At-the-Market-Equity Distribution Agreement—On April 11, 2022, the Company entered into an equity distribution agreement (the “Virtu Equity Distribution Agreement”) with Virtu Americas LLC (“Virtu”), to sell from time to time shares of the Company’s common stock having an aggregate offering price of up to $100 million. We will pay Virtu a commission of approximately 1% of the gross sales price of the shares of our common stock sold. The Company may also sell some or all of the shares of our common stock to Virtu as principal for its own account at a price agreed upon at the time of sale. The table below summarizes the activity (in thousands): Year Ended December 31, 2024 2023 Common stock issued 741 72 Gross proceeds $ 9,472 $ 1,477 Commissions and other expenses 95 15 Net proceeds $ 9,377 $ 1,462 Preferred Stock 8.45% Series D Cumulative Preferred Stock. At December 31, 2025 and 2024, there were 1.1 million and 1.1 million shares of Series D Cumulative Preferred Stock outstanding, respectively. The Series D Cumulative Preferred Stock ranks senior to all classes or series of the Company’s common stock and future junior securities, on a parity with each series of the Company’s outstanding preferred stock, Series F Cumulative Preferred Stock (noted below), Series G Cumulative Preferred Stock (noted below), Series H Cumulative Preferred Stock (noted below), Series I Cumulative Preferred Stock (noted below), Series J Preferred Stock (see note 16), Series K Preferred Stock (see note 16), Series L Preferred Stock (see note 16) and Series M Preferred Stock (see note 16) and with any future parity securities and junior to future senior securities and to all of the Company’s existing and future indebtedness, with respect to the payment of dividends and the distribution of amounts upon liquidation, dissolution or winding up of the Company’s affairs. Series D Cumulative Preferred Stock has no maturity date, and we are not required to redeem the shares at any time. Series D Cumulative Preferred Stock is redeemable at our option for cash, in whole or from time to time in part, at a redemption price of $25 per share plus accrued and unpaid dividends, if any, at the redemption date. Series D Cumulative Preferred Stock quarterly dividends are set at the rate of 8.45% per annum of the $25.00 liquidation preference (equivalent to an annual dividend rate of $2.1124 per share). The dividend rate increases to 9.45% per annum if these shares are no longer traded on a major stock exchange. In general, Series D Cumulative Preferred Stockholders have no voting rights. 7.375% Series F Cumulative Preferred Stock. At December 31, 2025 and 2024, there were 1.0 million and 1.0 million shares of 7.375% Series F Cumulative Preferred Stock outstanding, respectively. The Series F Cumulative Preferred Stock ranks senior to all classes or series of the Company’s common stock and future junior securities, on a parity with each series of the Company’s outstanding preferred stock, Series D Cumulative Preferred Stock, Series G Cumulative Preferred Stock (noted below), Series H Cumulative Preferred Stock (noted below), Series I Cumulative Preferred Stock (noted below), Series J Preferred Stock, Series K Preferred Stock, Series L Preferred Stock and Series M Preferred Stock and with any future parity securities and junior to future senior securities and to all of the Company’s existing and future indebtedness, with respect to the payment of dividends and the distribution of amounts upon liquidation, dissolution or winding up of the Company’s affairs. Series F Cumulative Preferred Stock has no maturity date, and we are not required to redeem the shares at any time. Series F Cumulative Preferred Stock is redeemable at our option for cash (on or after July 15, 2021), in whole or from time to time in part, at a redemption price of $25.00 per share plus accrued and unpaid dividends, if any, at the redemption date. Series F Cumulative Preferred Stock may be converted into shares of our common stock, at the option of the holder, in certain limited circumstances such as a change of control. Each share of Series F Cumulative Preferred Stock is convertible into a maximum 0.00969 shares of our common stock in those limited circumstances. The actual number is based on a formula as defined in the Series F Cumulative Preferred Stock agreement (unless the Company exercises its right to redeem the Series F cumulative preferred shares for cash, for a limited period upon a change in control). The necessary conditions to convert the Series F 112
Page 119
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Cumulative Preferred Stock to common stock have not been met as of period end. Therefore, Series F Cumulative Preferred Stock will not impact our earnings per share calculations. Series F Cumulative Preferred Stock quarterly dividends are set at the rate of 7.375% of the $25.00 liquidation preference (equivalent to an annual dividend rate of $1.8436 per share). In general, Series F Cumulative Preferred Stockholders have no voting rights. 7.375% Series G Cumulative Preferred Stock. At December 31, 2025 and 2024, there were 1.5 million and 1.5 million shares of 7.375% Series G Cumulative Preferred Stock outstanding, respectively. The Series G Cumulative Preferred Stock ranks senior to all classes or series of the Company’s common stock and future junior securities, on a parity with each series of the Company’s outstanding preferred stock, Series D Cumulative Preferred Stock, Series F Cumulative Preferred Stock, Series H Cumulative Preferred Stock (noted below), Series I Cumulative Preferred Stock (noted below), Series J Preferred Stock, Series K Preferred Stock, Series L Preferred Stock and Series M Preferred Stock and with any future parity securities and junior to future senior securities and to all of the Company’s existing and future indebtedness, with respect to the payment of dividends and the distribution of amounts upon liquidation, dissolution or winding up of the Company’s affairs. Series G Cumulative Preferred Stock has no maturity date, and we are not required to redeem the shares at any time. Series G Cumulative Preferred Stock is redeemable at our option for cash (on or after October 18, 2021), in whole or from time to time in part, at a redemption price of $25.00 per share plus accrued and unpaid dividends, if any, at the redemption date. Series G Cumulative Preferred Stock may be converted into shares of our common stock, at the option of the holder, in certain limited circumstances such as a change of control. Each share of Series G Cumulative Preferred Stock is convertible into a maximum 0.00833 shares of our common stock in those limited circumstances. The actual number is based on a formula as defined in the Series G Cumulative Preferred Stock agreement (unless the Company exercises its right to redeem the Series G cumulative preferred shares for cash, for a limited period upon a change in control). The necessary conditions to convert the Series G Cumulative Preferred Stock to common stock have not been met as of period end. Therefore, Series G Cumulative Preferred Stock will not impact our earnings per share calculations. Series G Cumulative Preferred Stock quarterly dividends are set at the rate of 7.375% of the $25.00 liquidation preference (equivalent to an annual dividend rate of $1.8436 per share). In general, Series G Cumulative Preferred Stockholders have no voting rights. 7.50% Series H Cumulative Preferred Stock. At December 31, 2025 and 2024, there were 1.0 million and 1.0 million shares of 7.50% Series H Cumulative Preferred Stock outstanding, respectively. The Series H Cumulative Preferred Stock ranks senior to all classes or series of the Company’s common stock and future junior securities, on a parity with each series of the Company’s outstanding preferred stock, Series D Cumulative Preferred Stock, Series F Cumulative Preferred Stock, Series G Cumulative Preferred Stock, Series I Cumulative Preferred Stock (noted below), Series J Preferred Stock, Series K Preferred Stock, Series L Preferred Stock and Series M Preferred Stock and with any future parity securities and junior to future senior securities and to all of the Company’s existing and future indebtedness, with respect to the payment of dividends and the distribution of amounts upon liquidation, dissolution or winding up of the Company’s affairs. Series H Cumulative Preferred Stock has no maturity date, and we are not required to redeem the shares at any time. Series H Cumulative Preferred Stock is redeemable at our option for cash (on or after August 25, 2022), in whole or from time to time in part, at a redemption price of $25.00 per share plus accrued and unpaid dividends, if any, at the redemption date. Series H Cumulative Preferred Stock may be converted into shares of our common stock, at the option of the holder, in certain limited circumstances such as a change of control. Each share of Series H Cumulative Preferred Stock is convertible into a maximum 0.00825 shares of our common stock in those limited circumstances. The actual number is based on a formula as defined in the Series H Cumulative Preferred Stock agreement (unless the Company exercises its right to redeem the Series H cumulative preferred shares for cash, for a limited period upon a change in control). The necessary conditions to convert the Series H Cumulative Preferred Stock to common stock have not been met as of period end. Therefore, Series H Cumulative Preferred Stock will not impact our earnings per share. Series H Cumulative Preferred Stock quarterly dividends are set at the rate of 7.50% of the $25.00 liquidation preference (equivalent to an annual dividend rate of $1.8750 per share). In general, Series H Cumulative Preferred Stockholders have no voting rights. 7.50% Series I Cumulative Preferred Stock. At December 31, 2025 and 2024, there were 1.0 million and 1.0 million shares of 7.50% Series I Cumulative Preferred Stock outstanding, respectively. The Series I Cumulative Preferred Stock ranks senior to all classes or series of the Company’s common stock and future junior securities, on a parity with each series of the Company’s outstanding preferred stock (the Series D Cumulative Preferred Stock, Series F Cumulative Preferred Stock, Series G Cumulative Preferred Stock, Series H Cumulative Preferred Stock, Series J Preferred Stock, Series K Preferred Stock, Series L Preferred Stock and Series M Preferred Stock) and with any future parity securities and junior to future senior securities and to all of the Company’s existing and future indebtedness, with respect to the payment of dividends and the distribution of amounts upon liquidation, dissolution or winding up of the Company’s affairs. Series I Cumulative Preferred Stock has no maturity date, and we are not required to redeem the shares at any time. Series I Cumulative Preferred Stock is redeemable at our option for cash (on or after November 17, 2022), in whole or from time to time in part, at a redemption price of $25.00 per 113
Page 120
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) share plus accrued and unpaid dividends, if any, at the redemption date. Series I Cumulative Preferred Stock may be converted into shares of our common stock, at the option of the holder, in certain limited circumstances such as a change of control. Each share of Series I Cumulative Preferred Stock is convertible into a maximum 0.00806 shares of our common stock in those limited circumstances. The actual number is based on a formula as defined in the Series I Cumulative Preferred Stock agreement (unless the Company exercises its right to redeem the Series I cumulative preferred shares for cash, for a limited period upon a change in control). The necessary conditions to convert the Series I Cumulative Preferred Stock to common stock have not been met as of period end. Therefore, Series I Cumulative Preferred Stock will not impact our earnings per share. Series I Cumulative Preferred Stock quarterly dividends are set at the rate of 7.50% of the $25.00 liquidation preference (equivalent to an annual dividend rate of $1.8750 per share). In general, Series I Cumulative Preferred Stockholders have no voting rights. 114
Page 121
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Ashford Trust entered into privately negotiated exchange agreements with certain holders of its preferred stock. The table below summarizes the activity (in thousands): Year Ended December 31, 2024 Year Ended December 31, 2023 PreferredSharesTendered Common SharesInitially Issued CommonSharesIssued PreferredSharesTendered Common SharesInitially Issued CommonSharesIssued 8.45% Series D Cumulative Preferred Stock 49 1,007 101 14 89 9 7.375% Series F Cumulative Preferred Stock 138 1,863 187 76 527 53 7.375% Series G Cumulative Preferred Stock 61 1,070 107 — — — 7.50% Series H Cumulative Preferred Stock 132 1,698 170 138 882 88 7.50% Series I Cumulative Preferred Stock 127 2,103 210 92 612 61 507 7,741 775 320 2,110 211 Dividends—A summary of dividends declared is as follows (in thousands): Year Ended December 31, 2025 2024 2023 Common stock $ — $ — $ — Preferred stock: Series D Cumulative Preferred Stock 2,347 2,397 2,472 Series F Cumulative Preferred Stock 1,912 1,970 2,272 Series G Cumulative Preferred Stock 2,712 2,756 2,824 Series H Cumulative Preferred Stock 1,946 2,001 2,389 Series I Cumulative Preferred Stock 1,939 2,023 2,306 Total dividends declared $ 10,856 $ 11,147 $ 12,263 Noncontrolling Interest in Consolidated Entities—On September 2, 2025, the Company became the sole remaining unit holder and general partner of Stirling OP when Stirling OP redeemed all of its unit holders other than Ashford Trust OP and Ashford TRS. As of December 31, 2025 and 2024, noncontrolling interest holders in Stirling OP held interests of $0 and $374,000, respectively. At December 31, 2025 and 2024, our noncontrolling interest partner held an interest in 815 Commerce MM of $15.5 million and $13.0 million, respectively. The table below summarizes (income) loss allocated to noncontrolling interests in consolidating entities (in thousands): Year Ended December 31, Line Item 2025 2024 2023 (Income) loss allocated to noncontrolling interests in consolidated entities $ 5,058 $ 4,028 $ 6 Shareholder Rights Plan—On December 15, 2025, we adopted a shareholder rights plan by entering into a Rights Agreement, dated December 15, 2025, with ComputerShare Trust Company, N.A., as rights agent (the “Rights Agreement”). The Rights Agreement is designed to prevent the Company from facing a substantial limitation on its ability to use its Tax Benefits (as such term is defined in the Rights Agreement) to offset potential future income taxes for federal income tax purposes and realize other efficiencies. The Board implemented the rights plan by declaring a dividend of one preferred share purchase right (a “Right”) for each outstanding share of common stock. The dividends were distributed on December 26, 2025, to our stockholders of record on that date. Each of those Rights becomes exercisable on the date on which the Rights separate and begin trading separately from our common stock and entitles the registered holder to purchase from the Company one one-thousandth of a share of our Series N Junior Participating Preferred Stock, par value $0.01 per share (“Series N Preferred Stock”), at a price of $20 per one one-thousandth of a share of our Series N Junior Participating Preferred Stock represented by such Right, subject to adjustment. The Rights will expire on the earliest of (i) 5:00 p.m. New York City time on December 14, 2026, (ii) the effective date of the repeal of Section 382 of the Code or any successor statute if the Board determines in its sole discretion that the Rights Agreement is no longer necessary or desirable for the preservation of Tax Benefits, or (iii) the first day of a taxable year of the Company to which the Board determines in its sole discretion that no Tax Benefits may be carried forward, unless the expiration date is extended or unless the Rights are earlier redeemed by the Company. The value of the Rights was de minimis. 115
Page 122
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) 15. Stock-Based Compensation Under the 2021 Stock Incentive Plan approved by stockholders, we are authorized to grant approximately 364,000 shares of restricted stock and performance stock units as incentive stock awards. At December 31, 2025, approximately 190,000 shares were available for future issuance under the 2021 Stock Incentive Plan. Restricted Stock—We incur stock-based compensation expense in connection with restricted stock awarded to certain employees of Ashford LLC and its affiliates. We also issue common stock to certain of our independent directors, which vests immediately upon issuance. At December 31, 2025, the unamortized cost of the unvested restricted stock was $169,000 which will be amortized over a period of 1.5 years with a weighted average period of 1.5 years. The following table summarizes the stock-based compensation expense (in thousands): Year Ended December 31, Line Item 2025 2024 2023 Advisory services fee $ 113 $ 266 $ 1,446 Management fees — — 10 Corporate, general and administrative — 11 89 Corporate, general and administrative - independent directors — 54 170 Corporate, general and administrative - Stirling OP 13 92 — $ 126 $ 423 $ 1,715 A summary of our restricted stock activity is as follows (shares in thousands): Year Ended December 31, 2025 2024 2023 Units Weighted AveragePrice at Grant Units Weighted AveragePrice at Grant Units Weighted AveragePrice at Grant Outstanding at beginning of year 51 $ 6.00 5 $ 261.73 12 $ 206.34 Restricted stock granted — — 56 6.55 4 40.10 Restricted stock vested (17) 6.00 (10) 149.84 (11) 230.60 Outstanding at end of year 34 $ 6.00 51 $ 6.00 5 $ 261.73 The fair value of restricted stock vested during the years ended December 31, 2025, 2024 and 2023 was $102,000, $121,000 and $417,000, respectively. Performance Stock Units—The compensation committee of the board of directors of the Company may authorize the issuance of performance stock units (“PSUs”), which have a cliff vesting period of three years, to certain executive officers and directors from time to time. The award agreements provide for the grant of a target number of PSUs that will be settled in shares of common stock of the Company, if, when and to the extent the applicable vesting criteria have been achieved following the end of the performance and service period. The criteria for the PSUs are based on performance conditions and market conditions under the relevant literature. The corresponding compensation cost is recognized, based on the corresponding measurement date fair value of the award, ratably over the service period for the award as the service is rendered, which may vary from period to period, as the number of PSUs earned may vary based on the estimated probable achievement of certain performance targets (performance conditions). The number of PSUs to be earned based on the applicable performance conditions is determined upon the final vesting date. The initial calculation of PSUs earned can range from 0% to 200% of target, which is further subjected to a specified absolute total stockholder return modifier (market condition) based on the formulas determined by the Company’s compensation committee on the grant date. This will result in an adjustment (75% to 125%) of the initial calculation for the number of PSUs earned based on the applicable performance targets resulting in a final award calculation ranging from 0% to 250% of the target amount. During the year ended December 31, 2025, Performance Stock Units granted in 2023 vested at 19% of target based on the performance conditions met over the performance period.
Page 123
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) The following table summarizes the compensation expense (in thousands): Year Ended December 31, Line Item 2025 2024 2023 Advisory services fee $ (539) $ 523 $ 604 A summary of our PSU activity is as follows (shares in thousands): Year Ended December 31, 2025 2024 2023 Units Weighted AveragePrice at Grant Units Weighted AveragePrice at Grant Units Weighted AveragePrice at Grant Outstanding at beginning of year 16 $ 49.27 19 $ 78.05 14 $ 290.41 PSUs granted — — — — 16 36.80 PSUs vested (3) 49.27 (2) 56.40 (8) 297.00 PSUs canceled (13) 49.27 (1) 56.40 (3) 297.00 Outstanding at end of year — $ — 16 $ 49.27 19 $ 78.05 16. Redeemable Preferred Stock Series J Redeemable Preferred Stock On March 31, 2025, the Company concluded its offering of the Company’s Series J Redeemable Preferred Stock (the “Series J Preferred Stock”). Prior to March 31, 2025, the Company entered into equity distribution agreements with certain sales agents to sell from time-to-time shares of the Series J Preferred Stock. Pursuant to such equity distribution agreements, the Company offered a maximum of 20.0 million shares of Series J Preferred Stock or Series K Preferred Stock (as defined below) in a primary offering at a price of $25.00 per share. The Company is also offering a maximum of 8.0 million shares of the Series J Preferred Stock or Series K Preferred Stock pursuant to a dividend reinvestment plan (the “DRIP”) at $25.00 per share (the “Stated Value”). The Series J Preferred Stock ranks senior to all classes or series of the Company’s common stock and future junior securities, on a parity with each series of the Company’s outstanding preferred stock and with any future parity securities and junior to future senior securities and to all of the Company’s existing and future indebtedness, with respect to the payment of dividends and the distribution of amounts upon liquidation, dissolution or winding up of the Company’s affairs. Holders of the Series J Preferred Stock shall not have any voting rights, except for if and whenever dividends on any shares of the Series J Preferred Stock shall be in arrears for 18 or more monthly periods, whether or not such quarterly periods are consecutive and the number of directors then constituting the board shall be increased by two and the holders of such shares of Series J Preferred Stock (voting together as a single class with all other classes or series of capital stock ranking on a parity with the Series J Preferred Stock) shall be entitled to vote for the election of the additional directors of the Company, who shall each be elected for one-year terms. Each share is redeemable at any time, at the option of the holder, at a redemption price of $25.00 per share, plus any accumulated, accrued and unpaid dividends, less a redemption fee. Starting on the second anniversary, each share is redeemable at any time, at the option of the Company, at a redemption price of $25.00 per share, plus any accumulated, accrued and unpaid dividends (with no redemption fee). The Company has the right, in its sole discretion, to redeem the shares in cash or in shares of common stock or any combination thereof, calculated based on the closing price per share for the single trading day prior to the date of redemption. The Series J Preferred Stock is also subject to conversion upon certain events constituting a change of control. Upon a change of control, the Company, at its option, may redeem, within 120 days, outstanding shares at a redemption price equal to the Stated Value plus an amount equal to any accrued but unpaid dividends. The Company must pay the redemption price in cash upon a change of control. The redemption fee shall be an amount equal to: • 8.0% of the stated value of $25.00 per share (the “Stated Value”) beginning on the Original Issue Date (as defined in the Articles Supplementary) of the shares of the Series J Preferred Stock to be redeemed; 117
Page 124
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) • 5.0% of the Stated Value beginning on the second anniversary from the Original Issue Date of the shares of the Series J Preferred Stock to be redeemed; and • 0% of the Stated Value beginning on the third anniversary from the Original Issue Date of the shares of the Series J Preferred Stock to be redeemed. The Series J Preferred Stock provides for cash dividends at an annual rate equal to 8.0% per annum of the Stated Value beginning on the date of the first settlement of the Series J Preferred Stock. Dividends are payable on a monthly basis and payable in arrears on the 15 of each month (or, if such payment date is not a business day, the next succeeding business day) to holders of record at the close of business on the last business day of each month immediately preceding the applicable dividend payment date. Dividends will be computed on the basis of 12 30-day months and a 360-day year. The Company has a DRIP that allows participating holders to have their Series J Preferred Stock dividend distributions automatically reinvested in additional shares of the Series J Preferred Stock at a price of $25.00 per share. The issuance activity of the Series J Preferred Stock is summarized below (in thousands): Year Ended December 31, 2025 2024 2023 Series J Preferred Stock shares issued 883 3,329 3,371 Net proceeds $ 19,877 $ 74,897 $ 75,837 ________ Exclusive of shares issued under the DRIP. The Series J Preferred Stock does not meet the requirements for permanent equity classification prescribed by the authoritative guidance because of certain cash redemption features that are outside of the Company’s control. As such, the Series J Preferred Stock is classified outside of permanent equity. At the date of issuance, the carrying amount of the Series J Preferred Stock was less than the redemption value. As a result of the Company’s determination that redemption is probable, the carrying value will be adjusted to the redemption amount each reporting period. The redemption value adjustment of Series J Preferred Stock is summarized below (in thousands): December 31, 2025 December 31, 2024 Series J Preferred Stock $ 179,818 $ 156,671 Cumulative adjustments to Series J Preferred Stock 9,469 6,038 ________ Reflects the excess of the redemption value over the accumulated carrying value. The following table summarizes dividends declared (in thousands): Year Ended December 31, 2025 2024 2023 Series J Preferred Stock $ 15,178 $ 10,711 $ 3,467 The following table summarizes Series J Preferred Stock redemptions settled in cash (in thousands): Year Ended December 31, 2025 2024 2023 Series J Preferred Stock shares redeemed — — 3 Redemption amount, net of redemption fees $ — $ — $ 78 th (1) (1) (1) (1) 118
Page 125
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) The following table summarizes Series J Preferred Stock redemptions settled in common stock (in thousands): Year Ended December 31, 2025 2024 2023 Series J Preferred Stock shares redeemed 155 90 — Redemption amount, net of redemption fees $ 3,653 $ 2,098 $ — Common shares issued upon redemption 586 235 — Series K Redeemable Preferred Stock On March 31, 2025, the Company concluded its offering of the Company’s Series K Redeemable Preferred Stock (the “Series K Preferred Stock”). Prior to March 31, 2025, the Company entered into equity distribution agreements with certain sales agents to sell from time-to-time shares of the Series K Preferred Stock. Pursuant to such equity distribution agreements, the Company offered a maximum of 20.0 million shares of Series K Preferred Stock or Series J Preferred Stock in a primary offering at a price of $25.00 per share. The Company is also offering a maximum of 8.0 million shares of the Series K Preferred Stock or Series J Preferred Stock pursuant to the DRIP at the Stated Value. The Series K Preferred Stock ranks senior to all classes or series of the Company’s common stock and future junior securities, on a parity with each series of the Company’s outstanding preferred stock and with any future parity securities and junior to future senior securities and to all of the Company’s existing and future indebtedness, with respect to the payment of dividends and the distribution of amounts upon liquidation, dissolution or winding up of the Company’s affairs. Holders of the Series K Preferred Stock shall not have any voting rights, except for if and whenever dividends on any shares of the Series K Preferred Stock shall be in arrears for 18 or more monthly periods, whether or not such quarterly periods are consecutive, and the number of directors then constituting the board shall be increased by two and the holders of such shares of Series K Preferred Stock (voting together as a single class with all other classes or series of capital stock ranking on a parity with the Series K Preferred Stock) shall be entitled to vote for the election of the additional directors of the Company who shall each be elected for one-year terms. Each share is redeemable at any time, at the option of the holder, at a redemption price of $25.00 per share, plus any accumulated, accrued and unpaid dividends, less a redemption fee. Starting on the second anniversary, each share is redeemable at any time, at the option of the Company, at a redemption price of $25.00 per share, plus any accumulated, accrued and unpaid dividends (with no redemption fee). The Company has the right, in its sole discretion, to redeem the shares in cash or in shares of common stock or any combination thereof, calculated based on the closing price per share for the single trading day prior to the date of redemption. The Series K Preferred Stock is also subject to conversion upon certain events constituting a change of control. Upon a change of control, the Company, at its option, may redeem, within 120 days, outstanding shares at a redemption price equal to the Stated Value plus an amount equal to any accrued but unpaid dividends. The Company must pay the redemption price in cash upon a change of control. The redemption fee shall be an amount equal to: • 1.5% of the stated value of $25.00 per share (the “Stated Value”) beginning on the Original Issue Date (as defined in the Articles Supplementary) of the shares of the Series K Preferred Stock to be redeemed; and • 0% of the Stated Value beginning on the first anniversary from the Original Issue Date of the shares of the Series K Preferred Stock to be redeemed. Holders of Series K Preferred Stock are entitled to receive cumulative cash dividends at the initial rate of 8.2% per annum of the Stated Value of $25.00 per share (equivalent to an annual dividend rate of $2.05 per share). Beginning one year from the date of original issuance of each share of Series K Preferred Stock and on each one-year anniversary thereafter for such share of Series K Preferred Stock, the dividend rate shall increase by 0.10% per annum; provided, however, that the dividend rate for any share of Series K Preferred Stock shall not exceed 8.7% per annum of the Stated Value. Dividends are payable on a monthly basis in arrears on the 15 of each month (or, if such payment date is not a business day, on the next succeeding business day) to holders of record at the close of business on the last business day of each month immediately preceding the applicable dividend payment date. Dividends will be computed on the basis of 12 30-day months and a 360-day year. th 119
Page 126
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) The Company has a DRIP that allows participating holders to have their Series K Preferred Stock dividend distributions automatically reinvested in additional shares of the Series K Preferred Stock at a price of $25.00 per share. The issuance activity of the Series K Preferred Stock is summarized below (in thousands): Year Ended December 31, 2025 2024 2023 Series K Preferred Stock shares issued 166 438 192 Net proceeds $ 4,036 $ 10,631 $ 4,664 ________ Exclusive of shares issued under the DRIP. The Series K Preferred Stock does not meet the requirements for permanent equity classification prescribed by the authoritative guidance because of certain cash redemption features that are outside of the Company’s control. As such, the Series K Preferred Stock is classified outside of permanent equity. At the date of issuance, the carrying amount of the Series K Preferred Stock was less than the redemption value. As a result of the Company’s determination that redemption is probable, the carrying value will be adjusted to the redemption amount each reporting period. The redemption value adjustment of Series K Preferred Stock is summarized below (in thousands): December 31, 2025 December 31, 2024 Series K Preferred Stock $ 18,215 $ 14,869 Cumulative adjustments to Series K Preferred Stock 741 487 ________ Reflects the excess of the redemption value over the accumulated carrying value. The following table summarizes dividends declared (in thousands): Year Ended December 31, 2025 2024 2023 Series K Preferred Stock $ 1,503 $ 828 $ 191 The following table summarizes Series K Preferred Stock redemptions settled by the issuance of common stock (in thousands): Year Ended December 31, 2025 2024 2023 Series K Preferred Stock shares redeemed 38 32 — Redemption amount, net of redemption fees $ 959 $ 796 $ — Common shares issued upon redemption 155 91 — Series L Redeemable Preferred Stock The Company entered into equity distribution agreements with certain sales agents to sell from time-to-time shares of the Series L Preferred Stock (the “Series L Preferred Stock”). Pursuant to such equity distribution agreements, the Company is offering a maximum of 12.0 million shares of Series L Preferred Stock or Series M Preferred Stock (as defined below) in a primary offering at a price of $25.00 per share, subject to offering discounts. The Company is also offering a maximum of 4.0 million shares of the Series L Preferred Stock or Series M Preferred Stock pursuant to a dividend reinvestment plan (the “DRIP”) at $25.00 per share (the “Stated Value”). On December 9, 2025, the Company terminated the primary offering of the Company’s Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock. The Company continued to offer shares of its Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock pursuant to its dividend reinvestment plan beyond the termination of the primary offering. (1) (1) (1) (1) 120
Page 127
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) The Series L Preferred Stock ranks senior to all classes or series of the Company’s common stock and future junior securities, on a parity with each series of the Company’s outstanding preferred stock and with any future parity securities and junior to future senior securities and to all of the Company’s existing and future indebtedness, with respect to the payment of dividends and the distribution of amounts upon liquidation, dissolution or winding up of the Company’s affairs. Holders of the Series L Preferred Stock shall not have any voting rights, except for if and whenever dividends on any shares of the Series L Preferred Stock shall be in arrears for 18 or more monthly periods, whether or not such quarterly periods are consecutive and the number of directors then constituting the board shall be increased by two and the holders of such shares of Series L Preferred Stock (voting together as a single class with all other classes or series of capital stock ranking on a parity with the Series L Preferred Stock) shall be entitled to vote for the election of the additional directors of the Company who shall each be elected for one-year terms. Each share is redeemable at any time, at the option of the holder, at a redemption price of $25.00 per share, plus any accumulated, accrued and unpaid dividends, less a redemption fee. Starting on the second anniversary, each share is redeemable at any time, at the option of the Company, at a redemption price of $25.00 per share, plus any accumulated, accrued and unpaid dividends (with no redemption fee). The Company has the right, in its sole discretion, to redeem the shares in cash or in shares of common stock or any combination thereof, calculated based on the closing price per share for the single trading day prior to the date of redemption. The Series L Preferred Stock is also subject to conversion upon certain events constituting a change of control. Upon a change of control, the Company, at its option, may redeem, within 120 days, outstanding shares at a redemption price equal to the Stated Value plus an amount equal to any accrued but unpaid dividends. The Company must pay the redemption price in cash upon a change of control. The redemption fee shall be an amount equal to: • 8.0% of the stated value of $25.00 per share (the “Stated Value”) beginning on the Original Issue Date (as defined in the Articles Supplementary) of the shares of the Series L Preferred Stock to be redeemed; • 5.0% of the Stated Value beginning on the second anniversary from the Original Issue Date of the shares of the Series L Preferred Stock to be redeemed; and • 0% of the Stated Value beginning on the third anniversary from the Original Issue Date of the shares of the Series L Preferred Stock to be redeemed. The Series L Preferred Stock provides for cash dividends at an annual rate equal to 7.5% per annum of the Stated Value beginning on the date of the first settlement of the Series L Preferred Stock. Dividends are payable on a monthly basis and payable in arrears on the 15 of each month (or, if such payment date is not a business day, the next succeeding business day) to holders of record at the close of business on the last business day of each month immediately preceding the applicable dividend payment date. Dividends will be computed on the basis of 12 30-day months and a 360-day year. The Company has a DRIP that allows participating holders to have their Series L Preferred Stock dividend distributions automatically reinvested in additional shares of the Series L Preferred Stock at a price of $25.00 per share. The issuance activity of the Series L Preferred Stock is summarized below (in thousands): Year Ended December31, 2025 Series L Preferred Stock shares issued 243 Net proceeds $ 5,027 ________ Exclusive of shares issued under the DRIP. The Series L Preferred Stock does not meet the requirements for permanent equity classification prescribed by the authoritative guidance because of certain cash redemption features that are outside of the Company’s control. As such, the Series L Preferred Stock is classified outside of permanent equity. th (1) (1) 121
Page 128
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) At the date of issuance, the carrying amount of the Series L Preferred Stock was less than the redemption value. As a result of the Company’s determination that redemption is probable, the carrying value will be adjusted to the redemption amount each reporting period. The redemption value adjustment of Series L Preferred Stock is summarized below (in thousands): December 31, 2025 Series L Preferred Stock $ 5,484 Cumulative adjustments to Series L Preferred Stock 1,064 ________ Reflects the excess of the redemption value over the accumulated carrying value. The following table summarizes dividends declared (in thousands): Year Ended December31, 2025 Series L Preferred Stock $ 216 The following table summarizes Series L Preferred Stock redemptions settled by the issuance of common stock (in thousands): Year Ended December31, 2025 Series L Preferred Stock shares redeemed 5 Redemption amount, net of redemption fees $ 126 Common shares issued upon redemption 39 Series M Redeemable Preferred Stock The Company entered into equity distribution agreements with certain sales agents to sell from time-to-time shares of the Series M Preferred Stock (the “Series M Preferred Stock). Pursuant to such equity distribution agreements, the Company is offering a maximum of 12.0 million shares of Series L Preferred Stock or Series M Preferred Stock in a primary offering at a price of $25.00 per share, subject to offering discounts. The Company is also offering a maximum of 4.0 million shares of the Series L Preferred Stock or Series M Preferred Stock pursuant to the DRIP at the Stated Value. On December 9, 2025, the Company terminated the primary offering of the Company’s Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock. The Company continued to offer shares of its Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock pursuant to its dividend reinvestment plan beyond the termination of the primary offering. The Series M Preferred Stock ranks senior to all classes or series of the Company’s common stock and future junior securities, on a parity with each series of the Company’s outstanding preferred stock and with any future parity securities and junior to future senior securities and to all of the Company’s existing and future indebtedness, with respect to the payment of dividends and the distribution of amounts upon liquidation, dissolution or winding up of the Company’s affairs. Holders of the Series M Preferred Stock shall not have any voting rights, except for if and whenever dividends on any shares of the Series M Preferred Stock shall be in arrears for 18 or more monthly periods, whether or not such quarterly periods are consecutive, and the number of directors then constituting the board shall be increased by two and the holders of such shares of Series M Preferred Stock (voting together as a single class with all other classes or series of capital stock ranking on a parity with the Series M Preferred Stock) shall be entitled to vote for the election of the additional directors of the Company who shall each be elected for one-year terms. Each share is redeemable at any time, at the option of the holder, at a redemption price of $25.00 per share, plus any accumulated, accrued and unpaid dividends, less a redemption fee. Starting on the second anniversary, each share is redeemable at any time, at the option of the Company, at a redemption price of $25.00 per share, plus any accumulated, accrued and unpaid dividends (with no redemption fee). The Company has the right, in its sole discretion, to redeem the shares in cash or in shares (1) (1) 122
Page 129
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) of common stock or any combination thereof, calculated based on the closing price per share for the single trading day prior to the date of redemption. The Series M Preferred Stock is also subject to conversion upon certain events constituting a change of control. Upon a change of control, the Company, at its option, may redeem, within 120 days, outstanding shares at a redemption price equal to the Stated Value plus an amount equal to any accrued but unpaid dividends. The Company must pay the redemption price in cash upon a change of control. The redemption fee shall be an amount equal to: • 1.5% of the stated value of $25.00 per share (the “Stated Value”) beginning on the Original Issue Date (as defined in the Articles Supplementary) of the shares of the Series M Preferred Stock to be redeemed; and • 0% of the Stated Value beginning on the first anniversary from the Original Issue Date of the shares of the Series M Preferred Stock to be redeemed. Holders of Series M Preferred Stock are entitled to receive cumulative cash dividends at the initial rate of 7.7% per annum of the Stated Value of $25.00 per share (equivalent to an annual dividend rate of $1.925 per share). Beginning one year from the date of original issuance of each share of Series M Preferred Stock and on each one-year anniversary thereafter for such share of Series M Preferred Stock, the dividend rate shall increase by 0.10% per annum; provided, however, that the dividend rate for any share of Series M Preferred Stock shall not exceed 8.2% per annum of the Stated Value. Dividends are payable on a monthly basis in arrears on the 15 of each month (or, if such payment date is not a business day, on the next succeeding business day) to holders of record at the close of business on the last business day of each month immediately preceding the applicable dividend payment date. Dividends will be computed on the basis of 12 30-day months and a 360-day year. The Company has a DRIP that allows participating holders to have their Series M Preferred Stock dividend distributions automatically reinvested in additional shares of the Series M Preferred Stock at a price of $25.00 per share. The issuance activity of the Series M Preferred Stock is summarized below (in thousands): Year Ended December31, 2025 Series M Preferred Stock shares issued 565 Net proceeds $ 12,605 ________ Exclusive of shares issued under the DRIP. The Series M Preferred Stock does not meet the requirements for permanent equity classification prescribed by the authoritative guidance because of certain cash redemption features that are outside of the Company’s control. As such, the Series M Preferred Stock is classified outside of permanent equity. At the date of issuance, the carrying amount of the Series M Preferred Stock was less than the redemption value. As a result of the Company’s determination that redemption is probable, the carrying value will be adjusted to the redemption amount each reporting period. th (1) (1) 123
Page 130
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) The redemption value adjustment of Series M Preferred Stock is summarized below (in thousands): December 31, 2025 Series M Preferred Stock $ 13,566 Cumulative adjustments to Series M Preferred Stock 2,200 ________ Reflects the excess of the redemption value over the accumulated carrying value. The following table summarizes dividends declared (in thousands): Year Ended December31, 2025 Series M Preferred Stock $ 463 The following table summarizes Series M Preferred Stock redemptions settled by the issuance of common stock (in thousands): Year Ended December31, 2025 Series M Preferred Stock shares redeemed 14 Redemption amount, net of redemption fees $ 347 Common shares issued upon redemption 64 17. Related Party Transactions Ashford Inc. Advisory Agreement with Ashford Trust OP Ashford LLC, a subsidiary of Ashford Inc., acts as our advisor. Our chairman, Mr. Monty J. Bennett, also serves as chairman of the board of directors and chief executive officer of Ashford Inc. Under our Advisory Agreement, we pay advisory fees to Ashford LLC. Advisory fees consist of base fees and incentive fees. We pay a monthly base fee in an amount equal to 1/12 of (i) 0.70% of the Total Market Capitalization (as defined in our Advisory Agreement) of the Company for the prior month, plus (ii) the Net Asset Fee Adjustment (as defined in our Advisory Agreement), if any, on the last day of the prior month during which the advisory agreement was in effect; provided, however, that in no event shall the Base Fee (as defined in our Advisory Agreement) for any month be less than the Minimum Base Fee as provided by the Advisory Agreement. The Company shall pay the Base Fee or the Minimum Base Fee (as defined in our Advisory Agreement) on the fifth business day of each month. The Minimum Base Fee for Ashford Trust for each quarter beginning January 1, 2021 is equal to the greater of: (i) ninety percent (90%) of the base fee paid for the same month in the prior fiscal year; and (ii) 1/12 of the G&A Ratio (as defined in the advisory agreement) for the most recently completed fiscal quarter multiplied by the Company’s Total Market Capitalization. We are also required to pay Ashford LLC an incentive fee that is measured annually (or for a stub period if the Advisory Agreement is terminated at other than year-end). In each year that the Company’s total shareholder return exceeds the average total shareholder return for the peer group, the Company shall pay to Ashford LLC an incentive fee. The incentive fee, if any, subject to the Fixed Coverage Charge Ratio Condition (as defined in the Advisory Agreement), shall be payable in arrears in three equal annual installments. We reimburse Ashford LLC for certain reimbursable overhead and internal audit, risk management advisory and asset management services, as specified in the Advisory Agreement. We also record equity-based compensation expense for equity grants of common stock and LTIP units awarded to officers and employees of Ashford LLC in connection with providing advisory services. (1) (1) th 124
Page 131
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) If we terminate the Advisory Agreement without cause or upon a change of control, we will be required to pay on or before the termination date our advisor a termination fee equal to: • (A) 1.1 multiplied by the greater of (i) 12 times the net earnings of our advisor for the 12 month period preceding the termination date of the advisory agreement; (ii) the earnings multiple for our advisor’s common stock for the 12 month period preceding the termination date of the advisory agreement multiplied by the net earnings of our advisor for the 12 month period preceding the termination date of the advisory agreement; or (iii) the simple average of the earnings multiples for each of the three fiscal years preceding the termination of the advisory agreement multiplied by the net earnings of our advisor for the 12 month period preceding the termination date of the advisory agreement; plus • (B) an additional amount such that the total net amount received by our advisor after the reduction by state and U.S. federal incometaxes at an assumed combined rate of 40% on the sum of the amounts described in (A) and (B) shall equal the amount described in (A);provided, that, the minimum amount of any termination fee calculated as of any date of determination shall be the greater of (i) the feethat would have been payable had such termination fee been calculated as of December 31, 2025 and (ii) the fee calculated as of suchdate of determination. The following table summarizes the advisory services fees incurred (in thousands): Year Ended December 31, 2025 2024 2023 Advisory services fee Base advisory fee $ 32,875 $ 32,017 $ 33,109 Reimbursable expenses 16,250 23,662 12,473 Equity-based compensation (773) 1,801 3,268 Total advisory services fee $ 48,352 $ 57,480 $ 48,850 ________ Reimbursable expenses include overhead, internal audit, risk management advisory, asset management services and deferred cash awards. Equity-based compensation is associated with equity grants of Ashford Trust’s common stock, LTIP units and Performance LTIP units awarded to officers and employees of Ashford LLC. On March 12, 2024, we entered into the Third Amended and Restated Advisory Agreement with Ashford LLC (the “Third Amended and Restated Advisory Agreement”). The Third Amended and Restated Advisory Agreement amends and restates the terms of the Second Amended and Restated Advisory Agreement, dated January 14, 2021, to, among other items: (i) require the Company pay the advisor the Portfolio Company Fee (as defined in the Advisory Agreement) upon certain specified defaults under the Company’s loan agreements resulting in the foreclosure of the Company’s hotel properties; (ii) provide that there shall be no additional payments to the advisor from the amendments to the master hotel management agreement with Remington Hospitality and the master project management agreement with Premier until the Oaktree Credit Agreement is paid in full, and limits, for a period of two years thereafter, the incremental financial impact to no more than $2 million per year in additional payments to the advisor from such amendments; (iii) reduce the Consolidated Tangible Net Worth covenant (as defined in the Advisory Agreement) to $750 million (plus 75% of net equity proceeds received) from $1 billion (plus 75% of net equity proceeds received); (iv) revise the criteria that would constitute a Company Change of Control; (v) revise the definition of termination fee to provide for a minimum amount of such termination fee; and (vi) revise the criteria that would constitute a voting control event. From August 8, 2024 through November 10, 2025, the Company and Ashford LLC entered into six amendments to the Advisory Agreement (the “Amendments”). The Amendments extended the outside date from May 31, 2025 to November 15, 2026 for which any sale or disposition of any of the Company’s Highland Portfolio and JPM8 hotel properties securing the associated mortgage loans following an event of default (as defined in the Advisory Agreement) would be excluded from the numerator of the calculation of the percentage of gross book value of the Company’s assets sold or disposed (but, for the avoidance of doubt, included in the denominator of such calculation) for purposes of determining whether a Company Change of Control (as defined in the Advisory Agreement) had occurred. (1) (2) (1) (2) 125
Page 132
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) On December 23, 2025, Ashford Inc. and Ashford Hospitality Advisors LLC delivered written notice to the Company of the Advisor’s election to extend the term of the Advisory Agreement for an additional ten-year term, commencing on January 14, 2031 and expiring on January 14, 2041. All terms, conditions, rights and obligations under the Advisory Agreement will remain in full force and effect during the extended term, subject to Section 6.5 of the Advisory Agreement that provides the parties to the Advisory Agreement the right to renegotiate the amount of the Base Fee or Incentive Fee (as such terms are defined in the Advisory Agreement) payable by the Company. Limited Waivers Under Advisory Agreement with Ashford Trust OP On March 2, 2023, we entered into a Limited Waiver Under Advisory Agreement (the “2023 Limited Waiver”) with Ashford Trust OP, Ashford TRS, Ashford Inc. and Ashford LLC. Pursuant to the 2023 Limited Waiver, the Company, Ashford Trust OP, Ashford TRS, Ashford Inc. and Ashford LLC waived the operation of any provision in the advisory agreement that would otherwise limit our ability, in our discretion and at our cost and expense, to award during the first and second fiscal quarters of calendar year 2023 cash incentive compensation to employees and other representatives of our advisor; provided that such awarded cash incentive compensation does not exceed $13.1 million, in the aggregate, during the waiver period. On March 11, 2024, we entered into a Limited Waiver Under Advisory Agreement with Ashford Inc. and Ashford LLC (the “2024 Limited Waiver”). Pursuant to the 2024 Limited Waiver, the Company, Ashford Trust OP, Ashford TRS, Ashford Inc. and Ashford LLC waive the operation of any provision in our advisory agreement that would otherwise limit the ability of the Company in its discretion, at the Company’s cost and expense, to award during calendar year 2024, cash incentive compensation to employees and other representatives of the Advisor. On March 10, 2025, we entered into a Limited Waiver Under Advisory Agreement with Ashford Inc. and Ashford LLC (the “2025 Limited Waiver”). Pursuant to the Limited Waiver, the Company, Ashford Trust OP, Ashford TRS, Ashford Inc. and Ashford LLCwaive the operation of any provision in our Advisory Agreement that would otherwise limit the ability of the Company in its discretion, at the Company’s cost and expense, to award during the first and second fiscal quarters of calendar year 2025, cash incentive compensation to employees and other representatives of the Advisor. On December 9, 2025, we entered into a Limited Waiver Under Advisory Agreement with Ashford Inc. and Ashford LLC (the “December 2025 Limited Waiver”). The December 2025 Limited Waiver permits the Company, Ashford Trust OP, Ashford TRS, Ashford Inc. and Ashford LLC to proceed with the Retention Agreement and related reimbursements for severance or non ‑ compete payments to Stephen Zsigray without triggering restrictions under the Advisory Agreement, and it is effective solely for this specific instance. Promissory Note with Ashford LLC On August 14, 2025, Ashford Trust OP executed a promissory note with Ashford LLC allowing Ashford Trust OP to draw up to $20 million in cash through August 15, 2026 to fund certain permitted costs (as defined in the promissory note). Funds advanced under the promissory note bear interest at an annual rate of 10.0% which may be paid in cash or paid in-kind at Ashford OP’s discretion. The maturity date of the promissory note was August 15, 2026, at which time all principal drawn upon and outstanding interest would have been due and payable. As collateral to secure the repayment of any amounts advanced by Ashford LLC under the promissory note, the Company pledged to Ashford LLC the Company’s equity in Ashford Trust OP subject to Ashford LLC’s filing of a financing statement in the appropriate jurisdiction. On November 10, 2025, Ashford Trust OP executed an amendment to the promissory note with Ashford LLC to allow Ashford Trust OP to draw up to $40 million in cash through November 15, 2026 to fund permitted costs (as defined in the promissory note). Funds advanced under the amended promissory note continued to bear interest at an annual rate of 10% which may be paid in cash or paid in-kind at Ashford OP’s discretion. As of December 31, 2025, no amount had been drawn under the amended promissory note. 126
Page 133
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Advisory Agreement with Stirling OP Effective December 6, 2023, Stirling REIT Advisors, LLC (“Stirling Advisor”), a subsidiary of Ashford Inc., entered into an advisory agreement with Stirling OP to act as Stirling OP’s advisor. On September 2, 2025, the advisory agreement with Stirling OP was terminated when the Company became the sole remaining unit holder and general partner of Stirling OP. See note 2. Stirling Advisor was paid an annual management fee (payable monthly in arrears) of 1.25% of aggregate NAV represented by the Class T, Class S, Class D and Class I shares of Stirling Inc. Additionally, Stirling OP paid Stirling Advisor a management fee equal to 1.25% of the aggregate NAV of Stirling OP attributable to such Class T, Class S, Class D and Class I operating partnership units not held by Stirling Inc. per annum payable monthly in arrears. No management fee was paid with respect to Class E shares of Stirling Inc. or Class E units of Stirling OP. The management fee was allocated on a class-specific basis and borne by all holders of the applicable class. The management fee was paid, at Stirling Advisor’s election, in cash, Class E shares of Stirling Inc. or Class E units of Stirling OP. The following table summarizes the advisory services fees incurred prior to September 2, 2025 (in thousands): Year Ended December 31, 2025 2024 2023 Advisory services fee Base advisory fee $ 363 $ 478 $ 67 Reimbursable expenses 111 194 10 Performance participation fee 213 454 — Total advisory services fee $ 687 $ 1,126 $ 77 ________ Reimbursable expenses include overhead, internal audit, risk management advisory and asset management services. Ashford Inc. and Stirling OP Advisor Support Prior to September 2, 2025, Stirling Advisor had agreed to advance on Stirling OP’s behalf certain general and administrative expenses in connection with Stirling OP’s formation and the raising of equity capital through December 31, 2025, at which point Stirling OP would reimburse Stirling Advisor for all such advanced expenses ratably over the 120 months following such date. Upon Stirling OP’s redemption of all of it’s unit holders other than Ashford Trust OP and Ashford TRS on September 2, 2025, Stirling OP was legally released from approximately $5.3 million of obligations previously owed by Stirling OP to Stirling Advisor for general and administrative expenses and other capital-raising costs paid by Stirling Advisor on Stirling OP’s behalf. The Company recorded the extinguishment of the related liabilities as a capital contribution from Stirling Advisor as required under GAAP. Warwick Pursuant to the Company’s hotel management agreements with each hotel management company, the Company bears the economic burden for casualty insurance coverage, which includes worker’s compensation, general liability and auto liability coverages. The hotel management companies procure worker’s compensation insurance, the expenses of which are passed through to the Company. Under the Advisory Agreement and hotel management agreements, Ashford Inc. secures general liability and auto liability policies to cover Ashford Trust, Braemar, their hotel managers, as needed, and Ashford Inc. The total cost estimates covered by such policies are based on the collective pool of risk exposures from each party. Ashford Inc. delegates the management of the casualty insurance program to Warwick Insurance Company, LLC (“Warwick”), a subsidiary of Ashford Inc., which issues policies covering general liability, workers’ compensation and auto liability losses. Each year Ashford Inc. collects funds from Ashford Trust, Braemar and their respective hotel management companies, to fund the casualty insurance program as needed, on an allocated basis. Cash Management The Company, Ashford Inc. and Braemar Hotels & Resorts Inc. (“Braemar”) are subject to an agreement pursuant to which Ashford LLC is to implement the REIT’s cash management strategies. This includes actively managing the REIT’s excess cash by primarily investing in short-term U.S. Treasury securities. The annual fee is 20 basis points (“bps”) of the average daily balance of the funds managed by Ashford LLC and is payable monthly in arrears. (1) (1) 127
Page 134
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Lismore We engage Lismore or its subsidiaries to provide debt placement services, assist with loan modifications or refinancings on our behalf and provide brokerage services. During the years ended December 31, 2025, 2024 and 2023, we incurred fees of $2.4 million, $3.4 million and $2.4 million, respectively. Ashford Securities Effective January 1, 2024, Ashford Trust, Ashford Inc. and Braemar (collectively, the “Parties” and each individually, a “Party”) entered into a Fourth Amended and Restated Contribution Agreement with respect to funding certain expenses of Ashford Securities LLC, a subsidiary of Ashford Inc. (“Ashford Securities”). The Fourth Amended and Restated Contribution Agreement stated that, notwithstanding anything in the prior contribution agreements: (1) the Parties equally split responsibility for all aggregate contributions made by them to Ashford Securities through September 30, 2021 and (2) thereafter, their contributions for each quarter were based on the ratio of the amounts raised by each Party through Ashford Securities the prior quarter compared to the total aggregate amount raised by the Parties through Ashford Securities the prior quarter. To the extent contributions made by any of the Parties through December 31, 2023 differed from the amounts owed pursuant to the foregoing, the Parties made true up payments to each other to settle the difference. During the first quarter of 2024, the funding requirement was revised based on the aggregate capital raised through Ashford Securities. This resulted in Ashford Trust making a payment of approximately $3.4 million to Ashford Inc. Effective December 9, 2025, the Parties entered into the Wind ‑ Down and Investor Servicing Cost Sharing Agreement providing for the orderly wind ‑ down of Ashford Securities as a FINRA member and SEC ‑ registered broker ‑ dealer and allocating all related wind ‑ down and investor servicing costs among the Parties based on each Party’s proportion of outstanding shares in applicable investment products as of each quarterly measurement date. The agreement supersedes prior cost ‑ allocation terms solely with respect to these wind ‑ down and servicing obligations and remains in effect until completion of the wind ‑ down and the end of all related servicing requirements. As of December 31, 2025, Ashford Trust has funded approximately $17.0 million and had a $2.4 million payable. As of December 31, 2024, Ashford Trust had funded approximately $13.2 million and had a $503,000 payable. The payables were included in “due to Ashford Inc., net” on our consolidated balance sheets. The table below summarizes the amount Ashford Trust has expensed related to reimbursed operating expenses of Ashford Securities (in thousands): Year Ended December 31, Line Item 2025 2024 2023 Corporate, general and administrative $ 7,194 $ 9,489 $ 3,030 Design and Construction Services – Ashford Trust Premier Project Management LLC (“Premier”), as a subsidiary of Ashford Inc., provides design and construction services to our hotels, including construction management, interior design, architectural services and the purchasing, freight management and supervision of installation of FF&E and related services. Pursuant to the design and construction services agreement, we pay Premier: (a) design and construction fees of up to 4% of project costs; and (b) market service fees at current market rates with respect to construction management, interior design, architecture, FF&E purchasing, FF&E expediting/freight management, FF&E warehousing and FF&E installation and supervision. On March 12, 2024, Ashford Trust OP entered into an Amended and Restated Master Project Management Agreement with Premier (the “A&R PMA”). The provisions of the A&R PMA are substantially the same as the Master Project Management Agreement, dated as of August 8, 2018. The A&R PMA provides for an initial term of ten years as to each hotel governed by the A&R PMA. The term may be renewed by Premier, at its option, for three successive periods of seven years each, and, thereafter, a final term of four years; provided that, at the time the option to renew is exercised, Premier is not then in default under the A&R PMA. The A&R PMA also: (i) provides that fees will be payable monthly as the service is delivered based on percentage completion; (ii) allows a project management fee to be paid on a development, together with (and not in lieu of) the development fee; and (iii) fixes the fees for FF&E purchasing, expediting, freight management and warehousing at 8%. 128
Page 135
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Design and Construction Services – Stirling OP On September 2, 2025, the Master Project Management Agreement with Stirling OP was terminated when the Company became the sole remaining unit holder and general partner of Stirling OP. See note 2. Prior to September 2, 2025, the Master Project Management Agreement provided that Premier would be paid a project management fee equal to 4% of the total project costs associated with the implementation of the capital improvement budget (both hard and soft) until such time that the capital improvement budget and/or renovation project involved the expenditure of an amount in excess of 5% of the gross revenues of the applicable hotel, whereupon the design project management fee was reduced to 3% of the total project costs in excess of the 5% of gross revenue threshold. The Master Project Management Agreement provided that Premier would provide the following services and would be paid the following fees: (i) architecture (6.5% of total construction costs, plus reimbursement for all third-party, out-of-pocket costs and expenses of mechanical, electrical and structural engineering services utilized in providing architectural services for project management work); (ii) construction management for projects without a general contractor (10% of total construction costs); (iii) interior design (6% of the purchase price of FFE designed or selected by Premier); (iv) FFE purchasing (8% of the purchase price of the FFE purchased by Premier; provided that, if the purchase price exceeded $2.0 million for a single hotel in a calendar year, then the procurement fee was reduced to 6% of the FFE purchase price in excess of $2.0 million for such hotel in such calendar year); (v) freight expediting (8% of the cost of expediting FFE); (vi) warehousing (8% of the cost of warehousing goods delivered to the job site); and (vii) development (4% of total project costs). Hotel Management Services As of December 31, 2025, Remington Hospitality managed 50 of our 68 hotel properties. We pay monthly hotel management fees equal to the greater of approximately $18,000 per hotel (increased annually based on consumer price index adjustments) or 3% of gross revenues as well as annual incentive management fees, if certain operational criteria were met, and other general and administrative expense reimbursements primarily related to accounting services. Our hotel management agreement also requires that we fund property-level operating costs including the hotel manager's payroll and related costs. On March 12, 2024, Ashford TRS Corporation entered into a Second Consolidated, Amended and Restated Hotel Master Management Agreement with Remington Hospitality (the “Second A&R HMA”). The provisions of the Second A&R HMA are substantially the same as in the Consolidated, Amended and Restated Hotel Master Management Agreement, dated as of August 8, 2018. The Second A&R HMA provides for an initial term of ten years as to each hotel governed by the Second A&R HMA. The term may be renewed by Remington Hospitality, at its option, for three successive periods of seven years each, and, thereafter, a final term of four years; provided that, at the time the option to renew is exercised, Remington Hospitality is not then in default under the Second A&R HMA. The Second A&R HMA also provides that Remington Hospitality may charge market premiums for its self-insured health plans to its hotel employees, the cost of which is an operating expense of the hotel properties. On September 11, 2024, Ashford TRS Corporation entered into the First Amendment (the “HMA Amendment”) to the Second A&R HMA with Remington Hospitality. Pursuant to the HMA Amendment, the amount of Group Services (as defined in the Second A&R HMA) charged per room per month at each hotel is capped at $38.32 (subject to annual increases beginning in 2026 equal to the greater of 3% or the percentage change in the Consumer Price Index over the preceding annual period) (the “Cap”). Any unpaid balance will be paid by Ashford TRS, and the Cap will be disregarded when calculating the Incentive Fee (as defined in the Second A&R HMA) for 2024. The Cap will not apply to hotels for whom the New Lessee (as defined in the Second A&R HMA) is not a direct or indirect wholly-owned subsidiary of Ashford TRS. Summary of Transactions In accordance with our advisory agreement, our advisor, or entities in which our advisor has an interest, have a right to provide products or services to our hotels, provided such transactions are evaluated and approved by our independent directors. The following tables summarize the entities in which our advisor has an interest with which we or our hotel properties contracted for products and services, the amounts recorded by us for those services and the applicable classification on our consolidated financial statements (in thousands): 129
Page 136
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Year Ended December 31, 2025 Company Product or Service Total Investments in HotelProperties, net Indebtedness, netOther Assets Other HotelRevenue ManagementFees Other HotelExpenses Ashford LLC Insurance claims services $ 11 $ — $ — $ — $ — $ — $ — Ashford Securities Capital raise services 8,819 — — — — — — INSPIRE Audio visual commissions 9,326 — — — 9,240 — — Lismore Capital Debt placement and related services 2,439 — 1,584 — — — — OpenKey Mobile key app 78 — — — — — 78 Premier Design and construction services 17,933 15,362 — — — — 400 Warwick Insurance related services 8,199 — — — — — — Ashford LLC Cash management services 8 — — — — — — Pure Wellness Hypoallergenic premium rooms 1,135 — — — — — 1,135 Remington Hospitality Hotel management services 49,430 — — — — 24,167 25,263 Year Ended December 31, 2025 Company Product or Service Total Property Taxes,Insurance andOther AdvisoryServices Fee InterestIncome Corporate, Generaland Administrative Write-off ofPremiums, LoanCosts and ExitFees Preferred Stock Ashford LLC Insurance claims services $ 11 $ 11 $ — $ — $ — $ — $ — Ashford Securities Capital raise services 8,819 — — — 7,194 — 1,625 INSPIRE Audio visual commissions 9,326 — — — 86 — — Lismore Capital Debt placement and related services 2,439 — — — — 855 — OpenKey Mobile key app 78 — — — — — — Premier Design and construction services 17,933 — 2,171 — — — — Warwick Insurance related services 8,199 8,199 — — — — — Ashford LLC Cash management services 8 — — (8) — — — Pure Wellness Hypoallergenic premium rooms 1,135 — — — — — — Remington Hospitality Hotel management services 49,430 — — — — — — Year Ended December 31, 2024 Company Product or Service Total Investments in HotelProperties, net Indebtedness, netOther Assets Other HotelRevenue ManagementFees Other HotelExpenses Ashford LLC Insurance claims services $ 9 $ — $ — $ — $ — $ — $ — Ashford Securities Capital raise services 11,816 — — — — — — INSPIRE Audio visual commissions 8,788 — — — 8,905 — — Lismore Capital Debt placement and related services 3,406 — — 475 — — — OpenKey Mobile key app 91 — — — — — 91 Premier Design and construction services 19,812 17,256 — — — — 437 Warwick Insurance related services 9,559 — — — — — 31 Ashford LLC Cash management services 67 — — — — — — Pure Wellness Hypoallergenic premium rooms 1,208 — — — — — 1,208 Remington Hospitality Hotel management services 54,569 — — — — 25,900 28,668 Year Ended December 31, 2024 Company Product or Service Total Property Taxes,Insurance andOther Advisory ServicesFee InterestIncome Corporate, Generaland Administrative Write-off ofpremiums, loancosts and exit feesPreferred Stock Ashford LLC Insurance claims services $ 9 $ 9 $ — $ — $ — $ — $ — Ashford Securities Capital raise services 11,816 — — — 9,489 — 2,327 INSPIRE Audio visual commissions 8,788 — — — 117 — — Lismore Capital Debt placement and related services 3,406 — — — — 2,931 — OpenKey Mobile key app 91 — — — — — — Premier Design and construction services 19,812 — 2,119 — — — — Warwick Insurance related services 9,559 9,528 — — — — — Ashford LLC Cash management services 67 — — (67) — — — Pure Wellness Hypoallergenic premium rooms 1,208 — — — — — — Remington Hospitality Hotel management services 54,569 — — — — — — (1) (2) (3) (3) (1) (2) (3) (3) 130
Page 137
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Year Ended December 31, 2023 Company Product or Service Total Investments in HotelProperties, net Indebtedness, netOther Assets Other HotelRevenue ManagementFees Other HotelExpenses Ashford LLC Insurance claims services $ 9 $ — $ — $ — $ — $ — $ — Ashford Securities Capital raise services 5,120 — — — — — — INSPIRE Audio visual commissions 9,955 — — — 10,064 — — Lismore Capital Debt placement and related services 2,444 — 767 525 — — — OpenKey Mobile key app 122 — — — — — 122 Premier Design and construction services 22,961 21,106 — — — — — Pure Wellness Hypoallergenic premium rooms 1,393 — — — — — 1,393 Remington Hospitality Hotel management services 57,587 — — — — 30,787 26,800 Year Ended December 31, 2023 Company Product or Service Total Property Taxes,Insurance and OtherAdvisory ServicesFee Corporate, Generaland AdministrativeWrite-off of Premiums,Loan Costs and Exit FeesPreferred Stock Ashford LLC Insurance claims services $ 9 $ 9 $ — $ — $ — $ — Ashford Securities Capital raise services 5,120 — — 3,030 — 2,090 INSPIRE Audio visual commissions 9,955 — — 109 — — Lismore Capital Debt placement and related services 2,444 — — — 1,152 — OpenKey Mobile key app 122 — — — — — Premier Design and construction services 22,961 — 1,855 — — — Pure Wellness Hypoallergenic premium rooms 1,393 — — — — — Remington Hospitality Hotel management services 57,587 — — — — — ________ Recorded in FF&E and depreciated over the estimated useful life. Recorded as deferred loan costs, which are included in “indebtedness, net” on our consolidated balance sheets and amortized over the initial term of the applicable loan agreement. Other hotel expenses include incentive hotel management fees and other hotel management costs. The following table summarizes amounts due (to) from Ashford Inc. (in thousands): Due (to) from Ashford Inc. Company Product or Service December 31, 2025 December 31, 2024 Ashford LLC Advisory services $ (23,499) $ (10,047) AIM Cash management services — (4) Ashford LLC Casualty insurance (9,247) (8,350) Ashford Securities Capital raise services/Broker dealer expense (148) (226) INSPIRE Audio visual (609) (858) OpenKey Mobile key app — (3) Premier Design and construction services (7,061) (1,478) Ashford LLC Stirling startup and ongoing operating expenses (39) (4,639) Pure Wellness Hypoallergenic premium rooms (40) (30) $ (40,643) $ (25,635) As of December 31, 2025 and 2024, due to related parties, net included a net payable to Remington Hospitality in the amount of $2.0 million and $2.9 million, respectively, primarily related to accrued base and incentive management fees and casualty insurance premiums. 18. Commitments and Contingencies Restricted Cash—Under certain management and debt agreements for our hotel properties existing as of December 31, 2025, escrow payments are required for insurance, real estate taxes and debt service. In addition, for certain properties based on the terms of the underlying debt and management agreements, we escrow generally 4% to 5% of gross revenues for capital improvements. From time to time, the Company may work with its property managers and lenders in order to utilize lender and manager held reserves to fund operating shortfalls. Franchise Fees—Under franchise agreements for our hotel properties existing as of December 31, 2025, we pay franchisor royalty fees between 3% and 6% of gross rooms revenue and, in some cases, 1% to 3% of food and beverage revenues. (1) (2) (3) (3) (1) (2) (3) 131
Page 138
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Additionally, we pay fees for marketing, reservations, and other related activities aggregating between 1% and 4% of gross rooms revenue and, in some cases, food and beverage revenues. These franchise agreements expire on varying dates between 2026 and 2049. When a franchise term expires, the franchisor has no obligation to renew the franchise. In addition, if we breach the franchise agreement and the franchisor terminates a franchise prior to its expiration date, we may be liable for up to three times the average annual fees incurred for that property. The table below summarizes the franchise fees incurred (in thousands): Year Ended December 31, Line Item 2025 2024 2023 Other hotel expenses $ 54,056 $ 54,795 $ 64,437 Management Fees—Under hotel management agreements for our hotel properties existing as of December 31, 2025, we pay monthly hotel management fees equal to the greater of approximately $18,000 per hotel (increased annually based on consumer price index adjustments) or 3% of gross revenues, or in some cases 2% to 7% of gross revenues, as well as annual incentive management fees, if applicable. These hotel management agreements expire from 2026 through 2038, with renewal options. If we terminate a hotel management agreement prior to its expiration, we may be liable for estimated management fees through the remaining term and liquidated damages or, in certain circumstances, we may substitute a new management agreement. Our hotel management agreements also require that we fund property-level operating costs, including the hotel manager’s payroll and related costs. Leases—We lease land and facilities under non-cancelable operating and finance leases, which expire between 2054 and 2084, including two ground leases related to two hotels and one lease that encompasses the Hilton Marietta. These leases are subject to base rent plus contingent rent based on each hotel property’s financial results and escalation clauses. Additionally, other leases have certain contingent rentals included. We are also a party to a lease for one hotel property that is treated as a failed sale and leaseback under the applicable accounting literature. See note 19. Capital Commitments—At December 31, 2025, we had capital commitments of $64.2 million, including commitments that will be satisfied with insurance proceeds, relating to general capital improvements that are expected to be paid in the next twelve months. Potential Pension Liabilities—Upon our 2006 acquisition of a hotel property, certain employees of such hotel were unionized and covered by a multi-employer defined benefit pension plan. At that time, no unfunded pension liabilities existed. Subsequent to our acquisition, a majority of employees, who are employees of the hotel manager, Remington Hospitality, petitioned the employer to withdraw recognition of the union. As a result of the decertification petition, Remington Hospitality withdrew recognition of the union. At the time of the withdrawal, the National Retirement Fund, the union’s pension fund, indicated unfunded pension liabilities existed. The National Labor Relations Board filed a complaint against Remington Hospitality seeking, among other things, a ruling that Remington Hospitality’s withdrawal of recognition was unlawful. The pension fund entered into a settlement agreement with Remington Hospitality on November 1, 2011, providing that Remington Hospitality will continue to make monthly pension fund payments pursuant to the collective bargaining agreement. As of December 31, 2025, Remington Hospitality continues to comply with the settlement agreement by making the appropriate monthly pension fund payments. If Remington Hospitality does not comply with the settlement agreement, we have agreed to indemnify Remington Hospitality for the payment of the unfunded pension liability, if any, as set forth in the settlement agreement equal to $1.7 million minus the monthly pension payments made by Remington Hospitality since the settlement agreement. To illustrate, if Remington Hospitality - as of the date a final determination occurs - has made monthly pension payments equaling $100,000, Remington Hospitality’s remaining withdrawal liability would be the unfunded pension liability of $1.7 million minus $100,000 (or $1.6 million). This remaining unfunded pension liability would be paid to the pension fund in annual installments of $84,000 (but may be made monthly or quarterly, at Remington Hospitality’s election), which shall continue for the remainder of 20 years, which is capped, unless Remington Hospitality elects to pay the unfunded pension liability amount earlier. Income Taxes—We and our subsidiaries file income tax returns in the federal jurisdiction and various states. Tax years 2021 through 2025 remain subject to potential examination by certain federal and state taxing authorities. Litigation—On December 20, 2016, a class action lawsuit was filed against one of the Company’s hotel management companies in the Superior Court of the State of California in and for the County of Contra Costa alleging violations of certain California employment laws, which class action affects nine hotels owned by subsidiaries of the Company. The court has 132
Page 139
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) entered an order granting class certification with respect to: (i) a statewide class of non-exempt employees of our manager who were allegedly deprived of rest breaks as a result of our manager’s previous written policy requiring its employees to stay on premises during rest breaks; and (ii) a derivative class of non-exempt former employees of our manager who were not paid for allegedly missed breaks upon separation from employment. Notices to potential class members were sent out on February 2, 2021. Potential class members had until April 4, 2021, to opt out of the class; however, the total number of employees in the class has not been definitively determined and is the subject of continuing discovery. The opt-out period has been extended until such time that discovery has concluded. In May 2023, the trial court requested additional briefing from the parties to determine whether the case should be maintained, dismissed or the class de-certified. After submission of the briefs, the court requested that the parties submit stipulations for the court to rule upon. On February 13, 2024, the judge ordered the parties to submit additional briefing related to on-site breaks. A tentative settlement in the amount of $850,000 was reached on February 14, 2025. Final court approval was obtained on September 12, 2025. Ashford Trust’s portion of the settlement is 88.2%. The case is now in the settlement administration phase. As of December 31, 2025, the settlement liability amount was accrued. On August 4, 2020, a lawsuit, Benjamin Zermeno v. Beverly Hills Marriott, was filed in Alameda County Superior Court as a PAGA representative action alleging various wage and hour violations of all Remington-managed California properties. The plaintiff’s individual claims were compelled to arbitration. On August 18, 2022, another lawsuit, Cristina Catalano v. Beverly Hills Marriott and Mr. C, was filed as a PAGA representative action alleging various wage and hour violations of all Remington-managed California properties. The co- defendant separately settled and the individual arbitration has also settled. A private mediation was held on December 27, 2024, to globally resolve the three outstanding matters. The court approved the settlement of all matters on January 16, 2026. The aggregate settlement is $2.5 million and Ashford Trust’s portion of the settlement is $1.8 million. As of December 31, 2025, the settlement liability amount was accrued. On April 18, 2024, the California Department of Industrial Relations (“DIR”) served the Company’s manager with an investigative subpoena relative to concerns with the Palm Springs Renaissance Hotel’s COVID recall efforts. On August 27, 2025, the DIR issued a citation that the Company’s manager failed to properly recall certain employees. On September 17, 2025, the Company’s manager filed an appeal which is currently pending. The matter is in the early stages and the ultimate outcome of this matter is unknown at this time. We do not believe that any potential loss to the Company is reasonably estimable at this time. As of December 31, 2025, no amounts were accrued. We are also engaged in other legal proceedings that have arisen but have not been fully adjudicated. To the extent the claims giving rise to these legal proceedings are not covered by insurance, they relate to the following general types of claims: employment matters; tax matters; and matters relating to compliance with applicable law (for example, the Americans with Disabilities Act and similar state laws). The likelihood of loss from these legal proceedings is based on the definitions within contingency accounting literature. We recognize a loss when we believe the loss is both probable and reasonably estimable. Based on the information available to us relating to these legal proceedings and/or our experience in similar legal proceedings, we do not believe the ultimate resolution of these proceedings, either individually or in the aggregate, will have a material adverse effect on our consolidated financial position, results of operations or cash flow. Our assessment may change depending upon the development of any current or future legal proceedings, and the final results of such legal proceedings cannot be predicted with certainty. If we ultimately do not prevail in one or more of these legal matters, and the associated realized losses exceed our current estimates of the range of potential losses, our consolidated financial position, results of operations or cash flows could be materially adversely affected in future periods. 19. Leases The majority of our leases, as lessee, are operating ground leases. We also have operating equipment leases, such as copier and vehicle leases, at our hotel properties. Some leases include one or more options to renew, with renewal terms that can extend the lease term from one year to 99 years. The exercise of lease renewal options is at our sole discretion. Some leases have variable payments, however, if variable payments are contingent, they are not included in the ROU assets and liabilities. Our lease of a single hotel property in Marietta, Georgia, is considered a finance lease. The discount rate used to calculate the lease liability and ROU asset related to our ground leases is based on our incremental borrowing rate (“IBR”), as the rate implicit in each lease is not readily determinable. The IBR is determined at commencement of the lease, or upon modification of the lease, as the interest rate a lessee would have to pay to borrow on a fully collateralized basis over a similar term and at an amount equal to the lease payments in a similar economic environment. 133
Page 140
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) As of December 31, 2025 and 2024, our leased assets and liabilities consisted of the following (in thousands): Lease Classification December 31, 2025 December 31, 2024 Assets Operating lease right-of-use assets Operating lease right-of-use assets$ 43,582 $ 43,780 Finance lease asset Investments in hotel properties, net 15,627 16,167 Total leased assets $ 59,209 $ 59,947 Liabilities Operating lease liabilities Operating lease liabilities $ 44,045 $ 44,369 Finance lease liability Finance lease liability 17,536 17,992 Total leased liabilities $ 61,581 $ 62,361 We incurred the following lease costs related to our leases (in thousands): Year Ended December 31, Lease cost Classification 2025 2024 2023 Operating lease cost Rent expense Hotel operating expenses - other $ 3,260 $ 4,084 $ 4,351 Finance lease cost Amortization of lease assets Depreciation and amortization $ 540 $ 540 $ 537 _______________________________________ For the years ended December 31, 2025, 2024, and 2023, operating lease cost includes approximately $1.5 million, $1.0 million and $1.1 million, respectively, of variable lease cost associated primarily with the ground leases and $(122,000), $(122,000) and $(15,000), respectively of net amortization costs related to the intangible assets and liabilities that were reclassified to “operating lease right-of-use assets” upon adoption of ASC 842. Short-term lease costs in aggregate are immaterial. Other information related to leases is as follows: Year Ended December 31, Supplemental Cash Flows Information 2025 2024 2023 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases (in thousands) $ 2,706 $ 2,707 $ 2,647 Weighted Average Remaining Lease Term Operating leases 66 years 66 years 67 years Finance lease 29 years 30 years 31 years Weighted Average Discount Rate Operating leases 5.27 % 5.27 % 5.26 % Finance lease 10.68 % 10.68 % 10.68 % _______________________________________ Calculated using the lease term, excluding extension options, and our calculated discount rates of the ground leases and owner managed leases. Represents our finance lease with the city of Marietta, Georgia, which terminates December 31, 2054. (1) (1) (1) (2) (1) (1) (2) 134
Page 141
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Future minimum lease payments due under non-cancellable leases as of December 31, 2025 were as follows (in thousands): Operating Leases Finance Lease 2026 $ 3,455 $ 2,284 2027 3,417 1,904 2028 3,403 1,904 2029 3,282 1,904 2030 3,208 1,904 Thereafter 189,644 48,110 Total future minimum lease payments 206,409 58,010 Less: interest 162,364 40,474 Present value of lease liabilities $ 44,045 $ 17,536 ________ Based on payment amounts as of December 31, 2025. Other Finance Liability On November 10, 2021, 815 Commerce LLC, a subsidiary of 815 Commerce MM, entered into a purchase and sale agreement. Pursuant to the purchase and sale agreement, 815 Commerce LLC sold its land and building in Fort Worth, Texas (the “Property”) for $30.4 million. Concurrent with the sale of the Property, 815 Commerce LLC entered into a 99-year lease agreement (the “Lease Agreement”), whereby 815 Commerce LLC will lease back the Property at an annual rental rate of approximately $1.5 million, subject to annual rent increases of 2.0%. Under the Lease Agreement, 815 Commerce LLC has a purchase option between 90-180 days prior to the commencement of the 36 lease year. In accordance with ASC 842, Leases, this transaction was recorded as a failed sale and leaseback as there are not alternative assets, substantially the same as the transferred asset, readily available in the marketplace for the repurchase option to qualify as a sale leaseback. Upon consolidation of 815 Commerce LLC in May 2023, the Company utilized a discount rate of 8.2% to determine the fair value of the finance liability. The finance liability of $27.2 million is included in “other liabilities” on the Company’s consolidated balance sheet as of December 31, 2025. 20. Income Taxes For U.S. federal income tax purposes, we elected to be treated as a REIT under the Code. To qualify as a REIT, we must meet certain organizational and operational stipulations, including a requirement that we distribute at least 90% of our REIT taxable income, excluding net capital gains, to our stockholders. We currently intend to adhere to these requirements and maintain our REIT status. If we fail to qualify as a REIT in any taxable year, we will be subject to U.S. federal income taxes at regular corporate rates (including any applicable alternative minimum tax) and may not qualify as a REIT for four years that are subsequently taxable. Even if we qualify for taxation as a REIT, we may be subject to certain state and local taxes as well as to federal income and excise taxes on our undistributed taxable income. At December 31, 2025, our 68 hotel properties were leased by our wholly owned or majority owned subsidiaries that are treated as taxable REIT subsidiaries for U.S. federal income tax purposes. Ashford TRS recognized net book income (loss) of $(54.6) million, $(54.5) million and $3.7 million for the years ended December 31, 2025, 2024 and 2023, respectively. (1) (1) th 135
Page 142
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) We have prospectively adopted the disclosure requirements as required after the adoption of ASU 2023-09. The following table reconciles the income tax (expense) benefit of the Company at applicable statutory rates to the actual income tax (expense) benefit recorded (in thousands): Year Ended December 31, 2025 $ % Income tax (expense) benefit at federal statutory rate of 21% $ 39,544 21.00 % State and local income tax, net of federal income tax effect (65) (0.03)% Changes in valuation allowance (10,727) (5.70)% Nontaxable or nondeductible items (798) (0.43)% Redeemable noncontrolling interests in operating partnership (553) (0.29)% Tax impact of REIT election (27,517) (14.61)% Other 259 0.14 % Total income tax (expense) benefit $ 143 0.08 % __________________ State taxes in Florida, Georgia, Tennessee and Virginia make up the majority of the tax effect in this category. As previously disclosed for the years ended December 31, 2024 and 2023, prior to the adoption of ASU 2023-09, the following table reconciles the income tax (expense) benefit of the TRS entities at applicable statutory rates to the actual income tax (expense) benefit recorded (in thousands): Year EndedDecember 31, 2024 2023 Income tax (expense) benefit of the TRS entities at federal statutory rate of 21% $ 11,448 $ (761) State income tax (expense) benefit, net of federal income tax benefit 1,613 (311) Permanent differences (554) (168) Provision to return adjustment 4 15 Gross receipts and margin taxes (1,081) (958) Interest and penalties 106 184 Valuation allowance (12,533) 1,099 Total income tax (expense) benefit $ (997) $ (900) The components of income tax (expense) benefit are as follows (in thousands): Year Ended December 31, 2025 2024 2023 Current: Federal $ — $ 8 $ (195) State (99) (994) (733) Total current income tax (expense) benefit (99) (986) (928) Deferred: Federal 242 (11) 28 Total deferred income tax (expense) benefit 242 (11) 28 Total income tax (expense) benefit $ 143 $ (997) $ (900) We have prospectively adopted the disclosure requirements as required after the adoption of ASU 2023-09. The following table presents the disaggregated cash paid for income taxes, net of refunds (in thousands): (1) (1) 136
Page 143
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Year Ended December 31, 2025 U.S. Federal $ — U.S. State and Local (1,954) Foreign — Total cash paid (refunded) during the period for income taxes $ (1,954) __________________ Individual jurisdictions equaling 5% or more of the total income taxes paid (net of refunds) for the year ended December 31, 2025 include California at $(2.0) million, Texas at $861,000 and Virginia at ($89,000). For the years ended December 31, 2025, 2024 and 2023 income tax expense includes interest and penalties paid to/(received from) taxing authorities of $31,000, $(106,000) and $184,000, respectively. At December 31, 2025 and 2024, we determined that there were no material amounts to accrue for interest and penalties due to taxing authorities. At December 31, 2025 and 2024, our net deferred tax asset, included in “prepaid expenses and other assets”, and net deferred tax liability, included in “accounts payable and accrued expenses”, on the consolidated balance sheets, respectively, consisted of the following (in thousands): December 31, 2025 2024 Deferred tax assets: Allowance for doubtful accounts $ 86 $ 87 Unearned income 1,414 768 Federal and state net operating losses 41,217 34,186 Capital loss carryforward — 2,290 Accrued expenses 1,050 1,740 Tax derivatives basis greater than book basis 40 39 Operating lease liability 2,253 2,265 Investment in partnership 2,725 — Other 253 443 Deferred tax assets 49,038 41,818 Valuation allowance (45,901) (37,553) Net deferred tax asset 3,137 4,265 Deferred tax liabilities: Prepaid expenses (4) (4) Operating lease right-of-use assets (2,252) (2,265) Tax property basis less than book basis (1,054) (2,411) Deferred tax liabilities (3,310) (4,680) Net deferred tax asset (liability) $ (173) $ (415) At December 31, 2025, we had TRS NOLs for U.S. federal income tax purposes of $174.2 million, however $82.5 million of our NOLs are subject to limitation in the amount of approximately $1.2 million per year under Section 382 of the Internal Revenue Code. NOLs become subject to an annual limitation in the event of certain cumulative changes in the ownership of significant shareholders over a three- year period in excess of 50%, as defined under Section 382 of the Internal Revenue Code. The remaining $91.7 million of our TRS federal NOLs are not subject to the limitations of Section 382. In total, $1.9 million of our TRS federal NOLs are subject to expiration and will begin to expire in 2026. The remainder were generated after December 31, 2017 and are not subject to expiration under the Tax Cuts and Jobs Act. At December 31, 2025, we had state net operating loss carryforwards of $1.1 billion which begin to expire in 2027. The Company also has indefinite-lived state NOLs. At December 31, 2025, we had REIT NOLs for U.S. federal income tax purposes of $1.4 billion based on the latest filed tax returns. The majority of our REIT NOLs are subject to limitation on their use under Section 382. $424.0 million of our net (1) 137
Page 144
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) operating loss carryforwards will begin to expire in 2029 and are available to offset future taxable income, if any, through 2036. The remainder were generated after December 31, 2017 and are not subject to expiration under the Tax Cuts and Jobs Act. At December 31, 2025 and 2024, we maintained a valuation allowance of $45.9 million and $37.6 million, respectively. At December 31, 2025 and 2024, we have reserved certain deferred tax assets of our TRS entities as we believe it is more likely than not that these deferred tax assets will not be realized. We considered all available evidence, both positive and negative. We concluded that the objectively verifiable negative evidence of a history of consolidated losses and the limitations imposed by the Code on the utilization of net operating losses of acquired subsidiaries outweigh the positive evidence. We believe this treatment is appropriate considering the nature of the intercompany transactions and leases between the REIT and its subsidiaries and that the current level of taxable income at the TRS is primarily attributable to our current transfer pricing arrangements. The transfer pricing arrangements are renewed upon expiration. Outside consultants prepared the transfer pricing studies supporting the rents from the leases. Outside consultants will continue to provide transfer pricing studies on any newly acquired properties. The intercompany rents are determined in accordance with the arms’ length transfer pricing standard, taking into account the cost of ownership to the REIT among other factors. We do not recognize deferred tax assets and a valuation allowance for the REIT since the REIT distributes its taxable income as dividends to stockholders, and in turn, the stockholders incur income taxes on those dividends. The following table summarizes the changes in the valuation allowance (in thousands): Year Ended December 31, 2025 2024 2023 Balance at beginning of year $ 37,553 $ 29,319 $ 31,205 Additions 8,348 8,234 — Deductions — — (1,886) Balance at end of year $ 45,901 $ 37,553 $ 29,319 21. Deferred Costs, net Deferred costs, net consist of the following (in thousands): December 31, 2025 2024 Deferred franchise fees $ 2,803 $ 3,066 Accumulated amortization (1,274) (1,278) Deferred costs, net $ 1,529 $ 1,788 22. Intangible Assets, net and Intangible Liabilities, net Intangible assets, net and intangible liabilities, net consisted of the following (in thousands): Intangible Assets, net Intangible Liabilities, net December 31, December 31, 2025 2024 2025 2024 Cost $ 797 $ 797 $ 2,723 $ 2,723 Accumulated amortization — — (774) (742) $ 797 $ 797 $ 1,949 $ 1,981 The intangible assets represent the acquisition of the permanent exclusive docking easement for riverfront land located in front of the Hyatt Savannah hotel in Savannah, Georgia. This intangible asset is not subject to amortization and has a carrying value of $797,000 as of December 31, 2025 and 2024. As of December 31, 2025 and 2024, intangible liabilities, net represents below market rate leases where the Company is the lessor. For the years ended December 31, 2025, 2024 and 2023 we recorded $32,000, $36,000, and $80,000, respectively, of other revenue related to leases where we are the lessor. 138
Page 145
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Estimated future amortization for intangible liabilities for each of the next five years and thereafter is as follows (in thousands): 2026 $ 32 2027 32 2028 32 2029 32 2030 32 Thereafter 1,789 Total $ 1,949 23. Concentration of Risk Our investments are primarily concentrated within the hotel industry. Our investment strategy is predominantly focused on investing in upper upscale full-service hotels in the United States that have RevPAR generally less than twice the national average. During 2025, approximately 15% of our total hotel revenue was generated from nine hotel properties located in the Washington D.C. area. All hotel properties securing our mortgage loans are located domestically at December 31, 2025. Accordingly, adverse conditions in the hotel industry will have a material adverse effect on our operating and investment revenues and cash available for distribution to stockholders. Financial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash and cash equivalents. We are exposed to credit risk with respect to cash held at various financial institutions that are in excess of the FDIC insurance limits of $250,000 and amounts due or payable under our derivative contracts. At December 31, 2025, we have exposure risk related to our derivative contracts. Our counterparties are investment grade financial institutions. 24. Segment Reporting We operate in one reportable business segment within the hotel lodging industry: direct hotel investments. Direct hotel investments refer to owning hotel properties through either acquisition or new development. We report operating results of direct hotel investments on an aggregate basis as substantially all of our hotel investments: (i) offer similar products and services to their customers in the form of hotel rooms, food and beverage, and ancillary services; (ii) utilize third-party hotel management companies to deliver its products and services to its customers; (iii) are designed and operated to appeal to similar individuals, groups, leisure and business customers; and (iv) have third- party hotel managers that utilize the same methods (direct hotel sales and various online booking portals) to distribute the Company’s products and services. As of December 31, 2025, 2024 and 2023 all of our hotel properties were in the U.S. and its territories. The Company’s chief operating decision maker (“CODM”) is its President and Chief Executive Officer. Each hotel property derives revenue primarily from guestroom sales, food and beverage sales and revenues from other lodging services and amenities. The accounting policies of each operating segment are the same as those described in the summary of significant accounting policies in note 2. The CODM reviews and makes decisions on all aspects of the Company’s business using all available financial and non-financial data for each hotel individually. Capital allocation decisions to acquire, sell, enhance, redevelop or perform renewal and replacement expenditures are determined on a hotel-by-hotel basis. Specifically, the CODM reviews the results of each hotel to assess the hotel’s profitability. The key measure the CODM uses to allocate resources and assess performance is individual hotel net income (loss) before interest expense, income taxes, depreciation and amortization, adjusted to exclude certain items determined by management to not be reflective of its ongoing operating performance or incurred in the normal course of business (“Hotel Adjusted EBITDA”). The adjustments include gains and losses on hotel dispositions, impairment charges, pre-opening costs associated with extensive renovation projects, property-level legal settlements, restructuring, severance, management transition costs and other expenses identified by management as non- recurring. The CODM does not regularly review asset information by segment. Following Stirling OP’s redemption of its unit holders on September 2, 2025, the Company updated the presentation of its reportable segment for December 31, 2025, 2024 and 2023 to incorporate the results of Stirling OP’s four hotel properties. Prior to September 2, 2025, the CODM did not regularly review the results of Stirling OP. The following tables include revenues, significant hotel operating expenses, and Hotel Adjusted EBITDA for the Company’s hotels, reconciled to the consolidated amounts included in the Company’s consolidated statements of operations (in thousands): 139
Page 146
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Year Ended December 31, 2025 2024 2023 REVENUE Rooms $ 825,623 $ 889,753 $ 1,059,155 Food and beverage 207,588 212,581 232,829 Other hotel revenue 69,643 67,800 72,748 Total hotel revenue 1,102,854 1,170,134 1,364,732 EXPENSES Rooms 198,002 209,569 $ 249,434 Food and beverage 139,324 145,304 161,300 Direct expenses 9,198 9,134 11,058 Indirect expenses: Property, general and administration 99,688 118,598 137,160 Sales and marketing 118,204 123,275 141,425 Information and telecommunications systems 17,202 19,031 21,707 Repairs and maintenance 53,704 56,118 61,892 Energy 43,269 43,442 51,516 Lease expense 4,374 4,177 4,344 Ownership expenses 1,955 2,456 3,075 Incentive management fee 15,562 18,110 19,457 Management fees 37,743 41,543 50,120 Property taxes 40,790 41,050 46,590 Other taxes (refunds) 165 (766) 634 Insurance 21,049 24,401 21,746 Total expenses 800,229 855,442 981,458 Hotel adjusted EBITDA $ 302,625 $ 314,692 $ 383,274 140
Page 147
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) Year Ended December 31, 2025 2024 2023 Reconciliation of hotel operating income (loss) to net income (loss) Hotel adjusted EBITDA $ 302,625 $ 314,692 $ 383,274 Other revenue 1,534 2,325 2,801 Ownership expenses included in rooms expense (104) — — Ownership expenses included in food and beverage expense (504) — — Ownership expenses included in other hotel expenses (28,915) (24,127) (12,457) Ownership expenses included in property taxes, insurance and other 2,211 973 (1,257) Management fees (520) (863) (491) Depreciation and amortization (141,295) (152,776) (187,807) Impairment charges (67,648) (59,331) — Advisory services fee (49,039) (58,606) (48,927) Corporate, general, and administrative (20,783) (24,662) (16,181) Gain (loss) on disposition of assets and hotel properties 79,799 94,406 11,488 Gain (loss) on derecognition of assets 39,054 167,177 — Equity in earnings (loss) of unconsolidated entities (325) (2,370) (1,134) Interest income 4,739 6,942 8,978 Other income (expense), net — 108 310 Interest expense and amortization of discounts and loan costs (256,229) (273,359) (326,970) Interest expense associated with hotels in receivership (39,038) (45,592) (39,178) Write-off of premiums, loan costs and exit fees (8,853) (5,245) (3,469) Gain (loss) on extinguishment of debt 335 2,774 53,386 Realized and unrealized gain (loss) on derivatives (5,346) (6,480) (2,200) Income tax (expense) benefit 143 (997) (900) Net income (loss) $ (188,159) $ (65,011) $ (180,734) The following table reconciles segment total revenue to total consolidated revenue: Year Ended December 31, 2025 2024 2023 Consolidated total hotel revenue $ 1,102,854 $ 1,170,134 $ 1,364,732 Other revenue 1,534 2,325 2,801 Total consolidated revenue $ 1,104,388 $ 1,172,459 $ 1,367,533 25. Subsequent Events On January 13, 2026, the Company extended its Highland mortgage loan secured by 18 hotels. As a condition to the extension, the loan was paid down by $10 million to a current balance of $723.6 million and has a final maturity date of July 9, 2026. On January 13, 2026, in order to preserve the Company’s liquidity position as it evaluates strategic alternatives, preferred dividends have been suspended, including dividends previously declared for share holders of record as of December 31, 2025 of the Company’s Series D, F, G, H, I, J, K, L and M preferred stock. On February 9, 2026 and February 17, 2026, the Company completed the sales of the 150-room Embassy Suites Houston located in Houston, Texas, and the 150-room Embassy Suites Austin located in Austin, Texas, for a combined $27.0 million, subject to customary pro rations and adjustments. 141
Page 148
ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued) On February 11, 2026, the Company received a notice of default and acceleration from the lender relating to the Company’s mortgage loan on the JPM8 hotel properties. The notice followed the Company’s failure on February 9, 2026 to make certain required payments and deliver required documentation under the existing loan extension, which constituted an event of default under the loan agreement. As a result, the lender demanded immediate payment of the outstanding principal balance of $325 million, plus accrued interest, default interest, fees, and other amounts due, and also required delivery of a replacement interest rate cap agreement. The loan is secured by eight hotel properties. The notice does not trigger any cross ‑ defaults under other loans of the Company’s subsidiaries, and the Company has no indebtedness at the parent ‑ company level. On December 12, 2025, the Company entered into a definitive agreement to sell the 333-room Hilton St. Petersburg Bayfront located in St. Petersburg, Florida for a purchase price of $96 million. The agreement included nonrefundable deposits totaling $2.4 million which were paid in February 2026. The sale was completed on March 5, 2026. On February 24, 2026, the Company entered into a definitive agreement to sell the 157-room La Posada de Santa Fe located in Santa Fe, New Mexico for a purchase price of $57.5 million. The agreement included a nonrefundable deposit of $4.0 million which was paid on February 24, 2026. The sale was completed on March 17, 2026. On February 25, 2026, the Company entered into definitive agreements to sell the 252-room Hilton Alexandria Old Town located in Alexandria, Virginia and the 160-room Embassy Suites Palm Beach Gardens located in Palm Beach, Florida for purchase prices of $58.0 million and $41.0 million, respectively. The agreements included nonrefundable deposits of $3.0 million and $2.1 million, respectively, which were paid in February of 2026. On March 13, 2026, we entered into a Limited Waiver Under Advisory Agreement with Ashford Inc. and Ashford LLC (the “2026 Advisory Agreement Limited Waiver”). Pursuant to the 2026 Advisory Agreement Limited Waiver, the Company, the Operating Partnership, TRS, Ashford Inc. and Ashford LLC waive the operation of any provision in our advisory agreement that would otherwise limit the ability of the Company in its discretion, at the Company’s cost and expense, to award during calendar year 2026, cash incentive compensation to employees and other representatives of Ashford Inc. and Ashford LLC. On March 16, 2026, the Company entered into a definitive agreement to sell the 168-room Lakeway Resort & Spa located in Austin, Texas for a purchase price of $37.8 million. The agreement included a nonrefundable deposit of $500,000 which was paid on March 16, 2026. 142
Page 149
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure None. Item 9A. Controls and Procedures EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES Under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, our management has evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d- 15(e) under the Exchange Act) as of December 31, 2025 (“Evaluation Date”). Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that, as of the Evaluation Date, our disclosure controls and procedures were effective (i) to ensure that information required to be disclosed in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms; and (ii) to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosures. MANAGEMENT’S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING Management is responsible for establishing and maintaining adequate internal control over financial reporting and for the assessment of the effectiveness of our internal control over financial reporting. The internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and our expenditures are being made only in accordance with authorizations of management and our directors and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the financial statements. Management assessed the effectiveness of our internal control over financial reporting as of December 31, 2025. In making the assessment of the effectiveness of our internal control over financial reporting, management has utilized the criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission, (2013 framework) (“COSO”). Based on management’s assessment of these criteria, we concluded that, as of December 31, 2025, our internal control over financial reporting was effective. CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING There were no changes in our internal controls over financial reporting that occurred during the fiscal quarter ended December 31, 2025, that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting. Item 9B. Other Information During the three months ended December 31, 2025, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading agreement” or “non-Rule 10b5-1 trading agreement,” as each term is defined in Item 408(a) of Regulation S-K. Item 9C. Disclosure Regarding Foreign Jurisdictions That Prevent Inspections Not applicable. PART III Item 10. Directors, Executive Officers and Corporate Governance The required information is incorporated by reference from the Proxy Statement pertaining to our 2026 Annual Meeting of Stockholders, to be filed with the SEC pursuant to Regulation 14A promulgated under the Exchange Act not later than 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K. 143
Page 150
Item 11. Executive Compensation The required information is incorporated by reference from the Proxy Statement pertaining to our 2026 Annual Meeting of Stockholders, to be filed with the SEC pursuant to Regulation 14A promulgated under the Exchange Act not later than 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters The required information is incorporated by reference from the Proxy Statement pertaining to our 2026 Annual Meeting of Stockholders, to be filed with the SEC pursuant to Regulation 14A promulgated under the Exchange Act not later than 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K. Item 13. Certain Relationships and Related Transactions, and Director Independence The required information is incorporated by reference from the Proxy Statement pertaining to our 2026 Annual Meeting of Stockholders, to be filed with the SEC pursuant to Regulation 14A promulgated under the Exchange Act not later than 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K. Item 14. Principal Accountant Fees and Services The required information is incorporated by reference from the Proxy Statement pertaining to our 2026 Annual Meeting of Stockholders, to be filed with the SEC pursuant to Regulation 14A promulgated under the Exchange Act not later than 120 days after the end of the fiscal year covered by this Annual Report on Form 10-K. PART IV Item 15. Exhibits, Financial Statement Schedules (a), (c) Financial Statement Schedules See Item 8, “Financial Statements and Supplementary Data,” on pages 74 through 142 hereof, for our consolidated financial statements and report of independent registered public accounting firm. The following financial statement schedule is included herein on pages 155 through 157 hereof. Schedule III – Real Estate and Accumulated Depreciation All other financial statement schedules have been omitted because such schedules are not required under the related instructions, such schedules are not significant, or the required information has been disclosed elsewhere in the consolidated financial statements and related notes thereto. (b) Exhibits Exhibit Description 2.1 Separation and Distribution Agreement, dated October 31, 2014, by and between Ashford Hospitality Trust, Inc., Ashford OPLimited Partner LLC, Ashford Hospitality Limited Partnership, Ashford Inc. and Ashford Hospitality Advisors LLC (incorporatedby reference to Exhibit 2.1 to Form 8-K, filed on November 6, 2014, for the event dated October 31, 2014) (File No. 001-31775) 3.1 Articles of Amendment and Restatement, as amended by Amendment Number One to Articles of Amendment and Restatement(incorporated by reference to Exhibit 4.6 to Registration Statement on Form S-3 filed May 15, 2015) (File No. 333-204235) 3.2 Articles of Amendment to the Company’s charter (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K, filed onMay 22, 2017) (File No. 001-31775) 3.3 Articles of Amendment to the Company’s charter (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K, filed on July 1, 2020) (File No. 001-31775) 3.4 Articles of Amendment to the Articles of Amendment and Restatement of the Company (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K, filed on July 16, 2021) (File No. 001-31775) 3.5 Articles of Amendment to the Articles of Amendment and Restatement of the Company (incorporated by reference to Exhibit 3.1 tothe Registrant’s Current Report on Form 8-K, filed on October 25, 2024) (File No. 001-31775) 3.6 Articles Supplementary, dated April 28, 2022 (incorporated by reference to Exhibit 4.10 to the Registrant’s Registration Statementon Form S-3, filed on April 29, 2022) (File No. 333-263323) 3.7 Articles Supplementary establishing the Series J Preferred Stock, dated September 14, 2022 (incorporated by reference to Exhibit3.1 to the Registrant’s Form 8-K, filed on September 14, 2022) (File No. 333-263323) 144
Page 151
Exhibit Description 3.8 Articles Supplementary establishing the Series K Preferred Stock, dated September 14, 2022 (incorporated by reference to Exhibit3.2 to the Registrant’s Form 8-K, filed on September 14, 2022) (File No. 333-263323) 3.9 Articles Supplementary, accepted for record and certified by the SDAT on January 22, 2025 (incorporated by reference to Exhibit4.10 to Amendment No. 1 to the Registration Statement on Form S-11 filed with the SEC on January 23, 2025) (File No. 333-283802) 3.10 Articles Supplementary establishing the Series L Preferred Stock, accepted for record and certified by the SDAT on January 22,2025 (incorporated by reference to Exhibit 4.11 to Amendment No. 1 to the Registration Statement on Form S-11 filed with theSEC on January 23, 2025) (File No. 333-283802) 3.11 Articles Supplementary establishing the Series M Preferred Stock, accepted for record and certified by the SDAT on January 22,2025 (incorporated by reference to Exhibit 4.12 to Amendment No. 1 to the Registration Statement on Form S-11 filed with theSEC on January 23, 2025) (File No. 333-283802) 3.12 Articles Supplementary Establishing and Fixing the Rights and Preference of the Series N Preferred Stock (incorporated byreference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on December 16, 2025) (File No. 001-31775) 3.13 Second Amended and Restated Bylaws, as amended by Amendment No. 1 on October 26, 2014, by Amendment No. 2 on October19, 2015, by Amendment No. 3 on August 2, 2016 by Amendment No. 4 on March 17, 2022 and by Amendment No. 5 on February23, 2023 by Amendment No. 6 on August 8, 2023 and by Amendment No. 7 on February 27, 2024, adopted on February 27, 2024(incorporated by reference to Exhibit 3.2 to the Registrant’s Form 8-K, filed on March 1, 2024) (File No. 01-31775) 3.14 Amendment No. 8 to Second Amended and Restated Bylaws of Ashford Hospitality Trust, Inc., as amended, adopted February 25,2025 (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K, filed on February 26, 2025) (FileNo. 01-31775) 3.15 Amendment No. 9 to Second Amended and Restated Bylaws of Ashford Hospitality Trust, Inc., as amended, adopted February 24,2026 (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K, filed on February 25, 2026) (FileNo. 001-31775) 3.16 Second Amended and Restated Bylaws, as amended by Amendment No. 1 on October 26, 2014, by Amendment No. 2 on October19, 2015, by Amendment No. 3 on August 2, 2016, by Amendment No. 4 on March 17, 2022, by Amendment No. 5 on February23, 2023, by Amendment No. 6 on August 8, 2023, by Amendment No. 7 on February 27, 2024, by Amendment No. 8 on February25, 2025 and by Amendment No. 9 on February 24, 2026, adopted on February 24, 2026 (incorporated by reference to Exhibit 3.2to the Registrant’s Current Report on Form 8-K, filed on February 25, 2026) (File No. 001-31775) 4.1 Form of Certificate for Common Stock (incorporated by reference to Exhibit 4.1 of Form S-11/A, filed on August 20, 2003) (FileNo. 001-31775) 4.1.1 Articles Supplementary for Series A Cumulative Preferred Stock, dated September 15, 2004 (incorporated by reference to Exhibit4.1.1 of Form 10-K, filed on February 28, 2012) (File No. 001-31775) 4.1.2 Form of Certificate of Series A Cumulative Preferred Stock (incorporated by reference to Exhibit 4.1.2 of Form 10-K, filed onFebruary 28, 2012) (File No. 001-31775) 4.2.1 Articles Supplementary for Series D Cumulative Preferred Stock, dated July 17, 2007 (incorporated by reference to Exhibit 3.5 tothe Registrant’s Form 8-A, filed July 17, 2007) (File No. 001-31775) 4.2.2 Form of Certificate of Series D Cumulative Preferred Stock (incorporated by reference to Exhibit 4.2 to the Registrant’s Form 8-A,filed July 17, 2007) (File No. 001-31775) 4.3.1 Articles Supplementary for Series E Cumulative Preferred Stock, dated April 15, 2011 (incorporated by reference to Exhibit 3.6 tothe Registrant’s Form 8-A, filed April 18, 2011) (File No. 001-31775) 4.3.2 Form of Certificate of Series E Cumulative Preferred Stock (incorporated by reference to Exhibit 4.2 to the Registrant’s Form 8-A,filed April 18, 2011) (File No. 001-31775) 4.4 Articles Supplementary for Series F Cumulative Preferred Stock, accepted for record and certified by the Maryland StateDepartment of Assessments and Taxation on July 11, 2016 (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K,filed July 12, 2016) (File No. 001-31775) 4.5 Articles Supplementary for Series G Cumulative Preferred Stock, accepted for record and certified by the Maryland StateDepartment of Assessments and Taxation on October 17, 2016 (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K, filed on October 18, 2016) (File No. 001-31775) 4.6 Articles Supplementary for Series H Cumulative Preferred Stock, accepted for record and certified by the Maryland StateDepartment of Assessments and Taxation on August 18, 2017 (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K, filed on August 22, 2017) (File No. 001-31775) 4.7 Articles Supplementary for Series I Cumulative Preferred Stock, accepted for record and certified by the Maryland StateDepartment of Assessments and Taxation on November 14, 2017 (incorporated by reference to Exhibit 3.1 to the Registrant’s Form8-K, filed on November 14, 2017) (File No. 001-31775) 4.8 Articles Supplementary establishing the Series J Preferred Stock, accepted for record and certified by the SDAT on September 14,2022 (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K, filed on September 14, 2022) (File No. 001-31775) 4.9 Articles Supplementary establishing the Series K Preferred Stock, accepted for record and certified by the SDAT on September 14,2022 (incorporated by reference to Exhibit 3.2 to the Registrant’s Form 8-K, filed on September 14, 2022) (File No. 001-31775) 145
Page 152
Exhibit Description 4.10 Rights Agreement, dated as of December 15, 2025, between Ashford Hospitality Trust, Inc. and ComputerShare Trust Company,N.A., as Rights Agent (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed on December16, 2025) (File No. 001-31775) 4.11* Description of Securities 10.1 Seventh Amended and Restated Agreement of Limited Partnership of Ashford Hospitality Limited Partnership (incorporated byreference to Exhibit 10.1 to the Registrant’s Form 8-K, filed on April 15, 2016) (File No. 001-31775) 10.1.2 Amendment No. 1 to Seventh Amended and Restated Agreement of Limited Partnership of Ashford Hospitality LimitedPartnership, dated July 12, 2016 (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K, filed on July 12, 2016)(File No. 001-31775) 10.1.3 Amendment No. 2 to Seventh Amended and Restated Agreement of Limited Partnership of Ashford Hospitality LimitedPartnership, dated October 18, 2016 (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K, filed on October 18,2016) (File No. 001-31775) 10.1.4 Amendment No. 3 to Seventh Amended and Restated Agreement of Limited Partnership of Ashford Hospitality LimitedPartnership, dated August 25, 2017 (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K, filed on August 25,2017) (File No. 001-31775) 10.1.5 Amendment No. 4 to Seventh Amended and Restated Agreement of Limited Partnership of Ashford Hospitality LimitedPartnership, dated November 17, 2017 (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K, filed on November17, 2017) (File No. 001-31775) 10.1.6 Amendment No. 5 to Seventh Amended and Restated Agreement of Limited Partnership of Ashford Hospitality LimitedPartnership, dated December 13, 2017 (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K, filed on December14, 2017) (File No. 001-31775) 10.1.7 Amendment No. 6 to Seventh Amended and Restated Agreement of Limited Partnership of Ashford Hospitality LimitedPartnership, dated as of February 26, 2019 (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K, filed on April29, 2022) (File No. 001-31775). 10.1.8 Amendment No. 7 to Seventh Amended and Restated Agreement of Limited Partnership of Ashford Hospitality LimitedPartnership, dated July 15, 2020 (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K, filed on July 15, 2020)(File No. 001-31775) 10.1.9 Amendment No. 8 to the Seventh Amended and Restated Agreement of Limited Partnership of Ashford Hospitality Limited Partnership, dated December 9, 2020 (incorporated by reference to Exhibit 99.1 to the Registrant’s Form 8-K, filed on December 15, 2020) (File No. 001-31775) 10.1.10 Amendment No. 9 to Seventh Amended and Restated Agreement of Limited Partnership of Ashford Hospitality LimitedPartnership, dated as of July 16, 2021 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with theSEC on July 16, 2021) (File No. 001-31775) 10.1.11 Amendment No. 10 to Seventh Amended and Restated Agreement of Limited Partnership of Ashford Hospitality LimitedPartnership, dated as of April 28, 2022 (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K filed with theSEC on April 29, 2022) (File No. 001-31775) 10.1.12 Amendment No. 11 to the Seventh Amended and Restated Agreement of Limited Partnership of Ashford Hospitality LimitedPartnership, dated as of September 14, 2022 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filedwith the SEC on September 14, 2022) (File No. 001-31775) 10.1.13 Amendment No. 12 to the Seventh Amended and Restated Agreement of Limited Partnership of Ashford Hospitality LimitedPartnership, dated October 25, 2024 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with theSEC on October 25, 2024) (File No. 001-31775) 10.1.14 Amendment No. 13 to Seventh Amended and Restated Agreement of Limited Partnership of Ashford Hospitality LimitedPartnership, dated as of January 22, 2025 (incorporated by reference to Exhibit 10.1.14 to Amendment No. 1 to the RegistrationStatement on Form S-11 filed with the SEC on January 23, 2025) (File No. 333-283802) 10.2.1† 2011 Stock Incentive Plan of Ashford Hospitality Trust, Inc. dated May 17, 2011 (incorporated by reference to Exhibit 10.1 to theRegistrant’s Form 8-K, filed on May 20, 2011, for the event dated May 17, 2011) (File No. 001-31775) 10.2.1.1† Amendment No. 1 to 2011 Incentive Stock Plan of Ashford Hospitality Trust, Inc., dated May 13, 2014 (incorporated by referenceto Exhibit 10.2 of Form 8-K, filed on May 19, 2014) (File No. 001-31775) 10.2.1.2† Amendment No. 2. to 2011 Incentive Stock Plan of Ashford Hospitality Trust, Inc., dated August 2, 2016 (incorporated byreference to Exhibit 10.1 to the Registrant’s Form 8-K, filed August 8, 2016) (File No.001-31775) 10.2.1.3† Amendment No. 3 to 2011 Incentive Stock Plan of Ashford Hospitality Trust, Inc., dated May 16, 2017 (incorporated by referenceto Exhibit 10.1 to the Registrant’s Form 8-K, filed May 22, 2017) (File No.001-31775) 10.2.1.4† Amendment No. 4 to 2011 Incentive Stock Plan of Ashford Hospitality Trust, Inc., dated July 15, 2020 (incorporated by referenceto Exhibit 10.2 to the Registrant’s Form 8-K, filed on July 15, 2020) (File No. 001-31775) 10.2.2.1† 2021 Stock Incentive Plan of Ashford Hospitality Trust, Inc., as amended and restated through May 10, 2022 (incorporated byreference to Exhibit 10.1 to the Registrant’s Form S-8, filed on May 11, 2022) (File No. 001-31775) 10.2.2.2† Form of 2024 Deferred Cash Award Agreement (incorporated by reference to Exhibit 10.10 to the Registrant’s Form 10-Q, filed onAugust 8, 2024) (File No. 001-31775) 10.2.2.3† Form of 2025 Deferred Cash Award Agreement (incorporated by reference to Exhibit 10.2.2.3 to the Registrant's Form 10-K, filedon March 21, 2025) (File No. 001-31775) 146
Page 153
Exhibit Description 10.2.2.4† Form of 2026 Deferred Cash Award Agreement (incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K, filed onMarch 17, 2026) (File No. 001-31775) 10.2.2.5† Form of 2023 Performance Stock Unit Award Agreement (incorporated by reference to Exhibit 10.2.2.4 to the Registrant’s Form10-K, filed on March 10, 2023) (File No. 001-31775) 10.2.2.6† Form of 2023 Performance LTIP Unit Award Agreement (incorporated by reference to Exhibit 10.2.2.4 to the Registrant’s Form 10-K, filed on March 10, 2023) (File No. 001-31775) 10.2.3† Second Amended and Restated Employment Agreement, by and among Ashford Inc., Ashford Hospitality Advisors, LLC, and J.Robison Hays, III, dated as of January 4, 2021 (incorporated by reference to Exhibit 99.1 of Form 8-K, filed on January 5, 2021)(File No. 001-31775) 10.3 Non-Compete/Services Agreement, dated as of March 21, 2008, between Ashford Hospitality Trust, Inc. and Archie Bennett, Jr.(incorporated by reference to Exhibit 10.4 of Form 10-K, filed on March 3, 2014) (File No. 001-31775) 10.4 Chairman Emeritus Agreement, dated January 7, 2013, between Ashford Hospitality Trust, Inc. Ashford Hospitality LimitedPartnership, and Archie Bennett, Jr. (incorporated by reference to Exhibit 10.1 of Form 8-K filed on January 9, 2013) (File No.001-31775) 10.5.1 Hotel Management Agreement between Remington Management, L.P. and Ashford TRS companies (incorporated by reference toExhibit 10.6.1 of Form 10-K, filed on February 28, 2012) (File No. 001-31775) 10.5.2 Hotel Master Management Agreement between Remington Lodging & Hospitality, LLC and PHH TRS Corporation (incorporatedby reference to Exhibit 10.6.2 of Form 10-K, filed on February 28, 2012) (File No. 001-31775) 10.6 Form of Lease Agreement between Ashford Hospitality Limited Partnership and Ashford TRS Corporation (incorporated byreference to Exhibit 10.11 of Form S-11/A, filed on July 31, 2003) (File No. 001-31775) 10.7 Indemnity Agreement dated March 10, 2011, between the Registrant and Remington Lodging & Hospitality, LLC (incorporated byreference to Exhibit 10.31 to the Registrant’s Form 10-Q, filed on May 10, 2011) (File No. 001-31775) 10.8 Right of First Offer Agreement between Ashford Hospitality Trust, Inc. and Ashford Hospitality Prime, Inc., dated November 19,2013 (incorporated by reference to Exhibit 10.6 of Form 8-K, filed on November 25, 2013, for the event dated November 19, 2013)(File No. 001-31775) 10.9 Option Agreement Pier House Resort by and between Ashford Hospitality Prime Limited Partnership and Ashford HospitalityLimited Partnership with respect to the Properties Entities, and Ashford TRS Corporation and Ashford Prime TRS Corporation withrespect to the TRS Entity, dated November 19, 2013 (incorporated by reference to Exhibit 10.7 of Form 8-K, filed on November25, 2013, for the event dated November 19, 2013) (File No. 001-31775) 10.10 Option Agreement Crystal Gateway Marriott by and between Ashford Hospitality Prime Limited Partnership and AshfordHospitality Limited Partnership with respect to the Properties Entities, and Ashford TRS Corporation and Ashford Prime TRSCorporation with respect to the TRS Entity, dated November 19, 2013 (incorporated by reference to Exhibit 10.8 of Form 8-K, filedon November 25, 2013, for the event dated November 19, 2013) (File No. 001-31775) 10.11 Registration Rights Agreement by and between Ashford Hospitality Prime, Inc., Ashford Hospitality Limited Partnership andAshford Hospitality Advisors LLC, dated November 19, 2013 (incorporated by reference to Exhibit 10.9 of Form 8-K, filed onNovember 25, 2013, for the event dated November 19, 2013) (File No. 001-31775) 10.12 Assignment, Assumption and Admission Agreement, dated as of September 10, 2014, by and between Ashford HospitalityAdvisors LLC and Monty Bennett, regarding the sale of Class B company interests of AIM Management Holdco, LLC(incorporated by reference to Exhibit 10.3 of Form 8-K, filed on September 10, 2014, for the event dated September 10, 2014) (FileNo. 001-31775) 10.13 Assignment, Assumption and Admission Agreement, dated as of September 10, 2014, by and between Ashford HospitalityAdvisors LLC and Rob Hays, regarding the sale of Class B company interests of AIM Management Holdco, LLC (incorporated byreference to Exhibit 10.4 of Form 8-K, filed on September 10, 2014, for the event dated September 10, 2014) (File No. 001-31775) 10.14 Assignment, Assumption and Admission Agreement, dated as of September 10, 2014, by and between Ashford HospitalityAdvisors LLC and Monty Bennett, regarding the sale of Class B limited partnership interests of AIM Performance Holdco, LP(incorporated by reference to Exhibit 10.5 of Form 8-K, filed on September 10, 2014, for the event dated September 10, 2014) (FileNo. 001-31775) 10.15 Assignment, Assumption and Admission Agreement, dated as of September 10, 2014, by and between Ashford HospitalityAdvisors LLC and Rob Hays, regarding the sale of Class B limited partnership interests of AIM Performance Holdco, LP(incorporated by reference to Exhibit 10.6 of Form 8-K, filed on September 10, 2014, for the event dated September 10, 2014) (FileNo. 001-31775) 10.16 Amended and Restated Limited Liability Company Agreement of Ashford Hospitality Advisors LLC (incorporated by reference toExhibit 10.2 of Form 8-K, filed on October 15, 2014) (File No. 001-31775) 10.17 Third Amended and Restated Limited Partnership Agreement of AIM Performance Holdco, LP (incorporated by reference toExhibit 10.1 of Form 8-K, filed on November 6, 2014, for the event dated November 5, 2014) (File No. 001-31775) 10.18 Second Amended and Restated Limited Liability Company Operating Agreement of AIM Management Holdco, LLC (incorporatedby reference to Exhibit 10.2 of Form 8-K, filed on November 6, 2014, for the event dated November 5, 2014) (File No. 001-31775) 147
Page 154
Exhibit Description 10.19 Tax Matters Agreement, dated October 31, 2014, between Ashford Inc., Ashford Hospitality Advisors LLC, Ashford HospitalityTrust, Inc. and Ashford Hospitality Limited Partnership (incorporated by reference to Exhibit 10.1 to Form 8-K, filed on November6, 2014, for the event dated October 31, 2014) (File No. 001-31775) 10.20.1 Amended and Restated Advisory Agreement, dated as of June 10, 2015, by and between Ashford Hospitality Trust, Inc., AshfordHospitality Limited Partnership, Ashford TRS Corporation, Ashford Inc. and Ashford Hospitality Advisors LLC (incorporated byreference to Exhibit 10.1 of Form 8-K, filed on June 12, 2015) (File No. 001-31775) 10.20.2 Enhanced Return Funding Program Agreement and Amendment No. 1 to the Amended and Restated Advisory Agreement, datedJune 26, 2018, among Ashford Hospitality Trust, Inc., Ashford Hospitality Limited Partnership, Ashford TRS Corporation, AshfordInc. and Ashford Hospitality Advisors LLC, dated June, 26, 2018, incorporated by reference to Exhibit 10.1 of the Company’sForm 8-K filed on June 26, 2018 (File No. 001-31775) 10.20.3 Extension Agreement to Enhanced Return Funding Program Agreement and Amendment No. 1 to the Amended and RestatedAdvisory Agreement, dated March 13, 2020, by and among Ashford Hospitality Trust, Inc., Ashford Hospitality LimitedPartnership, Ashford TRS Corporation, Ashford Inc., and Ashford Hospitality Advisors LLC (incorporated by reference to Exhibit10.2 of Form 8-K filed on March 16, 2020) 10.20.4 Side Letter, dated as of December 16, 2022, by and among, Ashford Hospitality Trust, Inc., Ashford Hospitality LimitedPartnership, Ashford TRS Corporation, Ashford Hospitality Advisors LLC and Ashford Inc. (incorporated by reference to Exhibit10.1 to the Registrant’s Form 8-K, filed on December 21, 2022) (File No. 001-31775) 10.20.5 Second Amended and Restated Advisory Agreement, dated as of January 14, 2021, by and between Ashford Hospitality Trust, Inc.,Ashford Hospitality Limited Partnership, Ashford TRS Corporation, Ashford Inc. and Ashford Hospitality Advisors LLC.(incorporated by reference to Exhibit 10.1 of Form 8-K filed on January 15, 2021) (File No. 001-31775) 10.20.6 Limited Waiver Under Advisory Agreement, dated as of March 15, 2022, by and among Ashford Hospitality Trust, Inc., AshfordHospitality Limited Partnership, Ashford TRS Corporation, Ashford Inc., and Ashford Hospitality Advisors LLC (incorporated byreference to Exhibit 10.1 of Form 8-K filed on March 16, 2022) (File No. 001-31775) 10.21 Assignment and Assumption Agreement, dated as of November 12, 2014 by and between Ashford Hospitality Trust, Inc., AshfordHospitality Limited Partnership and Ashford Hospitality Advisors LLC (incorporated by reference to Exhibit 10.2 to Form 8-K,filed on November 18, 2014, for the event dated November 12, 2014) (File No. 001-31775) 10.22 Licensing Agreement, dated as of November 12, 2014 by and between Ashford Hospitality Advisors LLC, Ashford HospitalityTrust, Inc. and Ashford Hospitality Limited Partnership (incorporated by reference to Exhibit 10.3 to Form 8-K, filed on November18, 2014, for the event dated November 12, 2014) (File No. 001-31775) 10.23 Letter Agreement dated December 14, 2014, between PRISA III Investments, LLC, a Delaware limited liability company andAshford Hospitality Limited Partnership, a Delaware limited partnership (incorporated by reference to Exhibit 10.1 to Form 8-K,filed on December 19, 2014) (File No. 001-31775) 10.24 Letter Agreement, dated September 17, 2015, by and between Ashford Hospitality Trust, Inc., and Ashford Inc. (incorporated byreference to Exhibit 10.1 to the Registrant’s Form 8-K filed on September 18, 2015) (File No. 001-31775) 10.25 Restricted Stock Award Agreement, dated February 20, 2017, by and between Ashford Hospitality Trust, Inc. and Douglas A.Kessler (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K filed on February 21, 2017) (File No. 001-31775). 10.26 Amended and Restated Employment Agreement, dated as of February 20, 2017, by and among Ashford Inc., Ashford HospitalityAdvisors LLC and Douglas A. Kessler (incorporated by reference to Exhibit 10.2 to the Registrant’s Form 8-K filed on February21, 2017) (File No. 001-31775) 10.27 Indemnification Agreement, dated as of February 20, 2017, by and between Ashford Hospitality Trust, Inc. and Douglas A. Kessler(incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K filed on February 21, 2017) (File No. 001-31775). 10.28 Loan Agreement, dated as of June 13, 2018, between Bank of America, N.A., Barclays Bank PLC and Morgan Stanley Bank, N.A.,as lenders, and Ashford Tipton Lakes LP, Ashford Scottsdale LP, Ashford Phoenix Airport LP, Ashford Hawthorne LP, Ashford SanJose LP, Ashford LV Hughes Center LP and Ashford Plymouth Meeting LP, as borrowers (incorporated by reference to Exhibit 10.1to the Registrant’s Form 8-K filed on June 19, 2018) (File No. 001-31775) 10.29 Senior Mezzanine Loan Agreement, dated June 13, 2018, between Bank of America, N.A., Barclays Bank PLC and MorganStanley Mortgage Capital Holdings LLC, as lenders, and Ashford Senior A LLC, as borrower (incorporated by reference to Exhibit10.2 to the Registrant’s Form 8-K filed on June 19, 2018) (File No. 001-31775) 10.30 Loan Agreement, dated June 13, 2018, between Bank of America, N.A., Barclays Bank PLC and Morgan Stanley Bank, N.A., aslenders, and Ashford Newark LP, Ashford BWI Airport LP, Ashford Oakland LP, Ashford Plano-C LP, Ashford Plano-R LP,Ashford Manhattan Beach LP and Ashford Basking Ridge LP as borrowers (incorporated by reference to Exhibit 10.3 to theRegistrant’s Form 8-K filed on June 19, 2018) (File No. 001-31775) 10.31 Senior Mezzanine Loan Agreement, dated June 13, 2018, between Bank of America, N.A., Barclays Bank PLC and MorganStanley Mortgage Capital Holdings LLC, as lenders, and Ashford Senior B LLC, as borrower (incorporated by reference to Exhibit10.4 to the Registrant’s Form 8-K filed on June 19, 2018) (File No. 001-31775) 10.32 Loan Agreement, dated as of June 13, 2018, between Bank of America, N.A., Barclays Bank PLC and Morgan Stanley Bank, N.A.,as lenders, and Ashford MV San Diego LP, Ashford Bucks County LLC, New Fort Tower I Hotel Limited Partnership, AshfordCoral Gables LP and Ashford Minneapolis Airport LP, as borrowers (incorporated by reference to Exhibit 10.5 to the Registrant’sForm 8-K filed on June 19, 2018) (File No. 001-31775) 148
Page 155
Exhibit Description 10.33 Senior Mezzanine Loan Agreement, dated June 13, 2018, between Bank of America, N.A., Barclays Bank PLC and MorganStanley Mortgage Capital Holdings LLC, as lenders, and Ashford Senior C LLC, as borrower (incorporated by reference to Exhibit10.6 to the Registrant’s Form 8-K filed on June 19, 2018) (File No. 001-31775) 10.34 Junior Mezzanine Loan Agreement, dated June 13, 2018, between Bank of America, N.A., Barclays Bank PLC and Morgan StanleyMortgage Capital Holdings LLC, as lenders, and Ashford Junior C LLC, as borrower (incorporated by reference to Exhibit 10.7 tothe Registrant’s Form 8-K filed on June 19, 2018) (File No. 001-31775) 10.35 Loan Agreement, dated as of June 13, 2018, between Bank of America, N.A., Barclays Bank PLC and Morgan Stanley Bank, N.A.,as lenders, and Ashford Dulles LP, Ashford Santa Fe LP, Ashford Market Center LP, New Beverly Hills Hotel Limited Partnershipand Ashford Atlantic Beach LP, as borrowers (incorporated by reference to Exhibit 10.8 to the Registrant’s Form 8-K filed on June19, 2018) (File No. 001-31775) 10.36 Senior Mezzanine Loan Agreement, dated June 13, 2018, between Bank of America, N.A., Barclays Bank PLC and MorganStanley Mortgage Capital Holdings LLC, as lenders, and Ashford Senior D LLC, as borrower (incorporated by reference to Exhibit10.9 to the Registrant’s Form 8-K filed on June 19, 2018) (File No. 001-31775) 10.37 Junior Mezzanine Loan Agreement, dated June 13, 2018, between Bank of America, N.A., Barclays Bank PLC and Morgan StanleyMortgage Capital Holdings LLC, as lenders, and Ashford Junior D LLC, as borrower (incorporated by reference to Exhibit 10.10 tothe Registrant’s Form 8-K filed on June 19, 2018) (File No. 001-31775) 10.38 Loan Agreement, dated as of June 13, 2018, between Bank of America, N.A., Barclays Bank PLC and Morgan Stanley Bank, N.A.,as lenders, and Ashford Memphis LP, Ashford Philly LP, Ashford Anchorage LP, Ashford Lakeway LP and Ashford Fremont LP, asborrowers (incorporated by reference to Exhibit 10.11 to the Registrant’s Form 8-K filed on June 19, 2018) (File No. 001-31775) 10.39 Consolidated, Amended and Restated Hotel Master Management Agreement, dated August 8, 2018, by and among Ashford TRSCorporation, RI Manchester Tenant Corporation, CY Manchester Tenant Corporation and Remington Lodging & Hospitality, LLC(incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K filed on August 14, 2018) (File No. 001-31775) 10.40 Master Project Management Agreement, dated August 8, 2018, by and among Ashford TRS Corporation, RI Manchester TenantCorporation, CY Manchester Tenant Corporation, Project Management LLC and Ashford Hospitality Limited Partnership(incorporated by reference to Exhibit 10.2 to the Registrant’s Form 8-K filed on August 14, 2018) (File No. 001-31775) 10.41 Amended and Restated Mutual Exclusivity Agreement, dated August 8, 2018, by and among Ashford Hospitality LimitedPartnership, Ashford Hospitality Trust, Inc. and Remington Lodging & Hospitality, LLC, as consented to by Monty J. Bennett(incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K filed on August 14, 2018) (File No. 001-31775) 10.42 Mutual Exclusivity Agreement, dated August 8, 2018, dated August 8, 2018, by and among Ashford Hospitality LimitedPartnership, Ashford Hospitality Trust, Inc. and Project Management LLC (incorporated by reference to Exhibit 10.4 to theRegistrant’s Form 8-K filed on August 14, 2018) (File No. 001-31775) 10.43 Investor Agreement, dated as of January 15, 2021, by and among Ashford Hospitality Trust, Inc., OPPS AHT Holdings, LLC and ROF8 AHT PT, LLC (incorporated by reference to Exhibit 10.2 to the Registrant’s Form 8-K, filed on January 15, 2021) (File No. 001-31775) 10.44 Subordination and Non-Disturbance Agreement, dated as of January 15, 2021, by and among Oaktree Fund Administration, LLC asthe Administrative Agent and collateral agent on behalf of the Lenders, Ashford Inc., Ashford Hospitality Advisors LLC, AshfordHospitality Trust, Inc., Ashford Hospitality Limited Partnership, Ashford TRS Corporation, Remington Lodging & Hospitality,LLC, Premier Project Management, LLC and Lismore Capital II LLC (incorporated by reference to Exhibit 10.3 to the Registrant’sForm 8-K, filed on January 15, 2021) (File No. 001-31775) 10.45 Credit Agreement, dated as of January 15, 2021, by and among Ashford Hospitality Trust, Inc., Ashford Hospitality LimitedPartnership, OPPS AHT Holdings, LLC, ROF8 AHT PT, LLC, Oaktree Phoenix Investment Fund AIF (Delaware), L.P., andOaktree Fund Administration, LLC, as administrative agent (incorporated by reference to Exhibit 10.1 of Form 8-K filed onJanuary 15, 2021) (File No. 001-31775) 10.46 Amendment No. 1 to the Credit Agreement, dated as of October 12, 2021, by and among Ashford Hospitality Trust, Inc., AshfordHospitality Limited Partnership, OPPS AHT Holdings, LLC, ROF8 AHT PT, LLC, The Lenders Phoenix Investment Fund AIF(Delaware), L.P., and Oaktree Fund Administration, LLC, as administrative agent. (incorporated by reference to Exhibit 10.2 to theRegistrant’s Form 8-K, filed on October 13, 2021) (File No. 001-31775) 10.47 Limited Waiver to Credit Agreement, dated as of November 19, 2021, by and among Ashford Hospitality Trust, Inc., AshfordHospitality Limited Partnership, the guarantors party thereto, the Lenders party thereto and Oaktree Fund Administration, LLC, asadministrative agent. (incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K, filed on November 23, 2021) (FileNo. 001-31775) 10.48 Common Stock Purchase Agreement, dated as of September 9, 2021, by and between the Company and M3A LP. (incorporated byreference to Exhibit 10.1 to the Registrant’s Form 8-K, filed on September 9, 2021) (File No. 001-31775) 10.49 Registration Rights Agreement, dated as of September 9, 2021, by and between the Company and M3A LP (incorporated byreference to Exhibit 10.2 to the Registrant’s Form 8-K, filed on September 9, 2021) (File No. 001-31775) 149
Page 156
Exhibit Description 10.50 Agreement of Purchase and Sale, dated as of December 16, 2022, by and between Ashford Hospitality Limited Partnership andAshford Hospitality Advisors LLC (incorporated by reference to Exhibit 10.2 to the Registrant’s Form 8-K, filed on December 21,2022) (File No. 001-31775) 10.51 Form of Equity Distribution Agreement, dated April 11, 2022, by and between the Company and Virtu Americas LLC (incorporatedby reference to Exhibit 10.1 to the Registrant’s Form 8-K, filed on April 11, 2022) (File No. 00131775) 10.52 Limited Waiver Under Advisory Agreement, dated as of March 2, 2023, by and among Ashford Hospitality Trust, Inc., AshfordHospitality Limited Partnership, Ashford TRS Corporation, Ashford Inc. and Ashford Hospitality Advisors LLC (incorporated byreference to Exhibit 10.1 to the Registrant’s Form 8-K, filed on March 3, 2023) (File No. 001-31775) 10.53 Limited Waiver to Credit Agreement, dated as of March 2, 2023, by and among Ashford Hospitality Limited Partnership, AshfordHospitality Trust, Inc., the guarantors party thereto, the Lenders party thereto and Oaktree Fund Administration, LLC, asadministrative agent (incorporated by reference to Exhibit 10.2 to the Registrant’s Form 8-K, filed on March 3, 2023) (File No.001-31775) 10.54† Ashford Hospitality Trust, Inc. 2021 Stock Incentive Plan, as amended by Amendment No. 4 (incorporated by reference to Exhibit10.2 to the Registrant’s Form 8-K, filed on October 25, 2024 ) (File No. 001-31775) 10.55 Amendment No. 2 to Credit Agreement, dated as of June 21, 2023, by and among Ashford Hospitality Trust, Inc., AshfordHospitality Limited Partnership, OCM AHT Holdings, LLC, ROF8 AHT PT, LLC, Oaktree Phoenix Investment Fund AIF(Delaware), L.P., and Oaktree Fund Administration, LLC, as administrative agent (incorporated by reference to Exhibit 10.3 to theRegistrant’s Form 8-K filed on June 23, 2023) (File No. 001-31775) 10.56*** Contribution Agreement, by and among Ashford Hospitality Limited Partnership, Ashford TRS Corporation and Stirling REIT OP,LP, dated December 6, 2023 (incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K, filed on December 6, 2023)(File No. 001-31775) 10.57 Lock-Up Agreement between Ashford Hospitality Limited Partnership and Stirling REIT OP, LP, dated December 6, 2023(incorporated by reference to Exhibit 10.2 to the Registrant’s Form 8-K, filed on December 6, 2023) (File No. 001-31775). 10.58 Lock-Up Agreement between Ashford TRS Corporation and Stirling REIT OP, LP, dated December 6, 2023 (incorporated byreference to Exhibit 10.3 to the Registrant’s Form 8-K, filed on December 6, 2023) (File No. 001-31775) 10.59 Third Amended and Restated Advisory Agreement, dated as of March 12, 2024, by and between Ashford Hospitality Trust, Inc.,Ashford Hospitality Limited Partnership, Ashford TRS Corporation, Ashford Inc. and Ashford Hospitality Advisors LLC(incorporated by reference to Exhibit 10.64 to the Registrant’s Annual Report on Form 10-K, filed on March 14, 2024 (File No.001-31775) 10.60 Second Consolidated, Amended and Restated Hotel Master Management Agreement, dated as of March 12, 2024, by and among,Ashford TRS companies and Remington Lodging & Hospitality, LLC (incorporated by reference to Exhibit 10.65 to theRegistrant’s Annual Report on Form 10-K, filed on March 14, 2024 (File No. 001-31775) 10.61 First Amendment to Second Consolidated, Amended and Restated Hotel Master Management Agreement by and between AshfordTRS Corporation and Remington Lodging & Hospitality, LLC, dated September 11, 2024 (incorporated by reference to Exhibit10.1 to the Registrant’s Current Report on Form 8-K, filed on September 12, 2024) (File No. 001-31775) 10.62 Amended and Restated Master Project Management Agreement, dated as of March 12, 2024, by and among Ashford HospitalityLimited Partnership, Ashford TRS Corporation, and Premier Project Management LLC (incorporated by reference to Exhibit 10.66to the Registrant’s Annual Report on Form 10-K, filed on March 14, 2024 (File No. 001-31775) 10.63 Amendment No. 3 to Credit Agreement, dated as of March 11, 2024, by and among Ashford Hospitality Trust, Inc., AshfordHospitality Limited Partnership, OCM AHT Holdings, LLC, ROF8 AHT PT, LLC, Oaktree Phoenix Investment Fund AIF(Delaware), L.P., and Oaktree Fund Administration, LLC, as administrative agent (incorporated by reference to Exhibit 10.67 to theRegistrant’s Annual Report on Form 10-K, filed on March 14, 2024 (File No. 001-31775) 10.64 Limited Waiver Under Advisory Agreement, dated as of March 11 2024, by and among Ashford Hospitality Trust, Inc., AshfordHospitality Limited Partnership, Ashford TRS Corporation, Ashford Inc. and Ashford Hospitality Advisors LLC (incorporated byreference to Exhibit 10.68 to the Registrant’s Annual Report on Form 10-K, filed on March 14, 2024 (File No. 001-31775) 10.65 Limited Waiver to Credit Agreement, dated as of March 11, 2024, by and among Ashford Hospitality Limited Partnership, AshfordHospitality Trust, Inc., the guarantors party thereto, the Lenders party thereto and Oaktree Fund Administration, LLC, asadministrative agent (incorporated by reference to Exhibit 10.69 to the Registrant’s Annual Report on Form 10-K, filed on March14, 2024 (File No. 001-31775) 10.66 Agreement of Purchase and Sale, dated as of January 29, 2024, by and between Beantown Hotel Owner, LLC and PIM BostonBack Bay LLC and PIM TRS Boston Back Bay LLC (incorporated by reference to Exhibit 10.7 to the Registrant’s Annual Reporton Form 10-K, filed on May 9, 2024) (File No. 001-31775) 10.67 First Amendment to Agreement of Purchase and Sale, dated as of February 28, 2024, by and between Beantown Hotel Owner, LLCand PIM Boston Back Bay LLC and PIM TRS Boston Back Bay LLC (incorporated by reference to Exhibit 10.7.1 to theRegistrant’s Annual Report on Form 10-K, filed on May 9, 2024) (File No. 001-31775) 150
Page 157
Exhibit Description 10.68 Second Amendment to Agreement of Purchase and Sale, dated as of April 8, 2024, by and between Beantown Hotel Owner, LLCand PIM Boston Back Bay LLC and PIM TRS Boston Back Bay LLC (incorporated by reference to Exhibit 10.7.2 to theRegistrant’s Annual Report on Form 10-K, filed on May 9, 2024) (File No. 001-31775) 10.69 Agreement of Purchase and Sale, dated May 31, 2024, by and among ACS One Ocean Propco LLC and Ashford Atlantic Beach LPand Ashford TRS Atlantic Beach LLC (incorporated by reference to Exhibit 10.8 to the Registrant’s Quarterly Report on Form 10-Q, filed on August 8, 2024) (File No. 001-31775) 10.70 Amendment No. 1 To the Third Amended and Restated Advisory Agreement, dated August 8, 2024, by and among AshfordHospitality Trust, Inc., Ashford Hospitality Limited Partnership, Ashford TRS Corporation, Ashford Inc., and Ashford HospitalityAdvisors LLC (incorporated by reference to Exhibit 10.9 to the Registrant’s Quarterly Report on Form 10-Q, filed on August 8,2024) (File No. 001-31775) 10.71 Amendment No. 2 To the Third Amended and Restated Advisory Agreement, dated November 8, 2024, by and among AshfordHospitality Trust, Inc., Ashford Hospitality Limited Partnership, Ashford TRS Corporation, Ashford Inc., and Ashford HospitalityAdvisors LLC (incorporated by reference to Exhibit 10.1.2 to the Registrant’s Quarterly Report on Form 10-Q, filed on November12, 2024) (File No. 001-31775) 10.72 Amendment No. 3 To the Third Amended and Restated Advisory Agreement, dated March 10, 2025, by and among AshfordHospitality Trust, Inc., Ashford Hospitality Limited Partnership, Ashford TRS Corporation, Ashford Inc., and Ashford HospitalityAdvisors LLC (incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8-K filed on March 13, 2025 (File No. 001-31775) 10.73 Agreement of Purchase and Sale by and between 275 Tremont Owner, LLC and HH FP Portfolio LLC dated November 27, 2024(incorporated by reference to Exhibit 10.73 to the Registrant’s Form 10-K filed on March 10, 2023) (File No. 001-31775) 10.74 Limited Waiver Under Advisory Agreement, dated as of March 10 2025, by and among Ashford Hospitality Trust, Inc., AshfordHospitality Limited Partnership, Ashford TRS Corporation, Ashford Inc. and Ashford Hospitality Advisors LLC (incorporated byreference to Exhibit 10.2 to the Registrant’s Form 8-K filed on March 13, 2025) (File No. 001-31775) 10.75 Amendment No. 4 to the Third Amended and Restated Advisory Agreement, dated as of May 12, 2025, by and among AshfordHospitality Trust, Inc., Ashford Hospitality Limited Partnership, Ashford TRS Corporation, Ashford Inc., and Ashford HospitalityAdvisors LLC (incorporated by reference to Exhibit 10.4 to the Registrant's Form 10-Q filed on March 14, 2025) (File No. 001-31775) 10.76 Amendment No. 5 to the Third Amended and Restated Advisory Agreement, dated as of August 14, 2025, by and among AshfordHospitality Trust, Inc., Ashford Hospitality Limited Partnership, Ashford TRS Corporation, Ashford Inc., and Ashford HospitalityAdvisors LLC (incorporated by reference to Exhibit 10.5 to the Registrant's Form 10-Q filed on August 14, 2025) (File No. 001-31775) 10.77 Master Line of Credit Promissory Note, dated as of August 1, 2025, by and among Ashford Hospitality Limited Partnership andAshford Hospitality Advisors LLC (incorporated by reference to Exhibit 10.6 to the Registrant's Form 10-Q filed on August 14,2025) (File No. 001-31775) 10.78 Amended and Restated Master Line of Credit Promissory Note, dated as of November 10, 2025, by and among Ashford HospitalityLimited Partnership and Ashford Hospitality Advisors LLC (incorporated by reference to Exhibit 10.6.1 to the Registrant’s Form10-Q filed on November 13, 2025) (File No. 001-31775) 10.79 Amendment No. 6 to the Third Amended and Restated Advisory Agreement, dated as of November 10, 2025, by and amongAshford Hospitality Trust, Inc., Ashford Hospitality Limited Partnership, Ashford TRS Corporation, Ashford Inc., and AshfordHospitality Advisors LLC (incorporated by reference to Exhibit 10.7 to the Registrant’s Form 10-Q filed on November13, 2025)(File No. 001-31775) 10.80 Retention Agreement, dated as of December 9, 2025, by and among Ashford Hospitality Trust, Inc., Ashford Inc. and StephenZsigray (incorporated by reference to Exhibit 10.1 to the Registrant’s Annual Report on Form 10-K, filed on December 9, 2025)(File No. 001-31775) 10.81 Limited Waiver Under Advisory Agreement, dated as of December 9, 2025, by and among Ashford Hospitality Trust, Inc., AshfordHospitality Limited Partnership, Ashford TRS Corporation, Ashford Inc. and Ashford Hospitality Advisors LLC (incorporated byreference to Exhibit 10.2 to the Registrant’s Annual Report on Form 10-K, filed on December 9, 2025) (File No. 001-31775) 10.82 Notice of Exercise of Extension of Term under Third Amended and Restated Advisory Agreement, as amended, dated as ofDecember 23, 2025 (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K, filed on December30, 2025) (File No. 001-31775) 10.83 Limited Waiver Under Advisory Agreement, dated as of March 13 2026, by and among Ashford Hospitality Trust, Inc., AshfordHospitality Limited Partnership, Ashford TRS Corporation, Ashford Inc. and Ashford Hospitality Advisors LLC (incorporated byreference to Exhibit 10.2 to the Registrant’s Form 8-K filed on March 17, 2026) (File No. 001-31775) 19.1 Policy on Insider Trading and Compliance (incorporated by reference to Exhibit 19.1 to the Annual Report on Form 10-K filed onMarch 21, 2025) (File No. 001-31775) 21.1* Registrant’s Subsidiaries Listing as of December 31, 2025 21.2* Registrant’s Special Purpose Entities Listing as of December 31, 2025 23.1* Consent of BDO USA, P.C. 151
Page 158
Exhibit Description 31.1* Certification of the Chief Executive Officer required by Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended 31.2* Certification of the Chief Financial Officer required by Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended 32.1** Certification of the Chief Executive Officer required by Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended (Inaccordance with SEC Release 33-8212, this exhibit is being furnished, and is not being filed as part of this report or as a separatedisclosure document, and is not being incorporated by reference into any Securities Act of 1933 registration statement.) 32.2** Certification of the Chief Financial Officer required by Rule 13a-14(b) of the Securities Exchange Act of 1934, as amended (Inaccordance with SEC Release 33-8212, this exhibit is being furnished, and is not being filed as part of this report or as a separatedisclosure document, and is not being incorporated by reference into any Securities Act of 1933 registration statement.) 97.1 Policy relating to recovery of erroneously awarded compensation, as required by applicable listing standards adopted pursuant to17 CFR 240.10D-1 (incorporated by reference to exhibit 97.1 to the Annual Report on Form 10-K filed March 21, 2025) (File No.001-31775) 99.1 Release and Waiver, by and between Ashford Hospitality Services, LLC and Jeremy Welter, dated April 15, 2022 (incorporated byreference to Exhibit 99.1 to the Current Report on Form 8-K filed on April 19, 2022) (File No. 001-31775) 99.2 Second Amended and Restated Employment Agreement, by and among Ashford Inc., Ashford Hospitality Advisors, LLC, and J.Robison Hays, III, dated as of January 4, 2021 (incorporated by reference to Exhibit 99.1 of Form 8-K, filed on January 5, 2021)(File No. 001-31775) 99.3 Release and Waiver, by and between Ashford Hospitality Advisors, LLC and Deric Eubanks, dated March 31, 2026 (incorporatedby reference to Exhibit 99.1 to the Current Report on Form 8-K filed on March 5, 2026) (File No. 001-31775) The following materials from the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 are formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Balance Sheets; (ii) Consolidated Statements of Operations; (iii) Consolidated Statements of Comprehensive Income (Loss); (iii) Consolidated Statements of Equity (Deficit); (iv) Consolidated Statements of Cash Flows; and (v) Notes to Consolidated Financial Statements. In accordance with Rule 402 of Regulation S-T, the XBRL related information in Exhibit 101 to this Annual Report on Form 10-K shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, and shall not be part of any registration statement or other document filed under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such filing. 101.INS XBRL Instance Document - the instance document does not appear in theInteractive Data File because its XBRL tags are embedded within the XBRLdocument 101.SCH Inline XBRL Taxonomy Extension Schema Document. Submitted electronically with this report. 101.CAL Inline XBRL Taxonomy Calculation Linkbase Document. Submitted electronically with this report. 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document. Submitted electronically with this report. 101.LAB Inline XBRL Taxonomy Label Linkbase Document. Submitted electronically with this report. 101.PRE Inline XBRL Taxonomy Presentation Linkbase Document. Submitted electronically with this report. 104 Cover Page Interactive Data File (formatted in Inline XBRL and containedin Exhibit 101) _________________________ * Filed herewith. ** Furnished herewith. *** Certain schedules have been omitted. The registrant agrees to furnish a copy of any omitted schedules to the Securities and Exchange Commission upon request. † Management contract or compensatory plan or arrangement. Item 16. Form 10-K Summary None. 152
Page 159
SIGNATURES Pursuant to the requirements of Section 13 or 15(d) 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, on March 20, 2026. ASHFORD HOSPITALITY TRUST, INC. By:/s/ STEPHEN ZSIGRAY Stephen Zsigray President and Chief Executive Officer Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below on behalf of the Registrant in the capacities and on the dates indicated. Signature Title Date /s/ MONTY J. BENNETT Chairman of the Board of Directors March 20, 2026 Monty J. Bennett /s/ STEPHEN ZSIGRAY President and Chief Executive Officer (Principal Executive Officer) March 20, 2026 Stephen Zsigray /s/ DERIC S. EUBANKS Chief Financial Officer (Principal Financial Officer) March 20, 2026 Deric S. Eubanks /s/ JUSTIN R. COE Chief Accounting Officer (Principal Accounting Officer) March 20, 2026 Justin R. Coe /s/ DAVE JOHNSON Director March 20, 2026 Dave Johnson /s/ FREDERICK J. KLEISNER Director March 20, 2026 Frederick J. Kleisner /s/ AMISH GUPTA Director March 20, 2026 Amish Gupta /s/ SHERI L. PANTERMUEHL Director March 20, 2026 Sheri L. Pantermuehl 153
Page 160
SCHEDULE III ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES REAL ESTATE AND ACCUMULATED DEPRECIATION December 31, 2025 (dollars in thousands) Column A Column B Column C Column D Column E Column F Column G Column H Column I Initial Cost Costs CapitalizedSince Acquisition Gross Carrying AmountAt Close of Period Hotel Property Location Encumbrances Land FF&E,Buildings andImprovements Land FF&E,Buildings andImprovements Land FF&E,Buildings andImprovements Total AccumulatedDepreciation ConstructionDate AcquisitionDate IncomeStatement Embassy Suites Austin, TX $ 22,025 $1,204 $ 9,388 $ 193 $ 10,330 $1,397 $ 19,718 $21,115 $ 11,274 08/1998 (1), (2), (3) Embassy Suites Dallas, TX 14,579 1,876 8,907 238 14,753 2,114 23,660 25,774 12,850 12/1998 (1), (2), (3) Embassy Suites Herndon, VA 15,000 1,303 9,836 277 3,810 1,580 13,646 15,226 9,011 12/1998 (1), (2), (3) Embassy Suites Las Vegas, NV 28,547 3,307 16,952 397 6,398 3,704 23,350 27,054 13,573 05/1999 (1), (2), (3) Embassy Suites Houston, TX 16,790 1,799 10,404 — 3,289 1,799 13,693 15,492 7,109 03/2005 (1), (2), (3) Embassy Suites West PalmBeach, FL 18,667 3,277 13,949 — 13,086 3,277 27,035 30,312 11,591 03/2005 (1), (2), (3) Embassy Suites Philadelphia,PA 17,000 5,791 34,819 — 2,287 5,791 37,106 42,897 18,329 12/2006 (1), (2), (3) Embassy Suites Arlington, VA 38,140 36,065 41,588 — 6,640 36,065 48,228 84,293 24,316 04/2007 (1), (2), (3) Embassy Suites Portland, OR 72,763 11,110 60,048 (5,615) (38,476) 5,495 21,572 27,067 2,936 04/2007 (1), (2), (3) Embassy Suites Santa Clara,CA 55,489 8,948 46,239 — 5,625 8,948 51,864 60,812 24,614 04/2007 (1), (2), (3) Embassy Suites Orlando, FL 18,534 5,674 21,593 — 4,452 5,674 26,045 31,719 12,594 04/2007 (1), (2), (3) Hilton GardenInn Jacksonville,FL 11,082 1,751 9,164 — 1,604 1,751 10,768 12,519 5,729 11/2003 (1), (2), (3) Hilton GardenInn Austin, TX 60,414 7,605 48,725 — 1,054 7,605 49,779 57,384 14,459 03/2015 (1), (2), (3) Hilton GardenInn Baltimore, MD 14,788 4,027 20,199 — 1,563 4,027 21,762 25,789 7,286 03/2015 (1), (2), (3) Hilton GardenInn Virginia Beach,VA 29,305 4,101 26,329 — 6,646 4,101 32,975 37,076 8,178 03/2015 (1), (2), (3) Hilton Ft. Worth, TX 45,000 4,538 13,922 — 12,693 4,538 26,615 31,153 15,083 03/2005 (1), (2), (3) Hilton St. Petersburg,FL 45,938 2,991 13,907 (1,130) 10,415 1,861 24,322 26,183 10,864 03/2005 (1), (2), (3) Hilton Santa Fe, NM 45,000 7,004 10,689 — 2,305 7,004 12,994 19,998 6,815 12/2006 (1), (2), (3) Hilton Bloomington,MN 10,700 5,685 59,139 — 5,321 5,685 64,460 70,145 31,080 04/2007 (1), (2), (3) Hilton Costa Mesa,CA 54,033 12,917 91,791 (7,145) (66,653) 5,772 25,138 30,910 2,246 04/2007 (1), (2), (3) Hilton Parsippany, NJ 34,716 7,293 58,098 — 2,432 7,293 60,530 67,823 18,925 03/2015 (1), (2), (3) Hilton Tampa, FL 25,022 5,206 21,186 — 2,450 5,206 23,636 28,842 8,609 03/2015 (1), (2), (3) Hilton Alexandria, VA 62,753 14,459 96,602 (4,982) (45,580) 9,477 51,022 60,499 249 06/2018 (1), (2), (3) Hilton Santa Cruz,CA 21,971 9,399 38,129 (4,092) (18,174) 5,307 19,955 25,262 3,116 02/2019 (1), (2), (3) Hampton Inn Evansville, IN 10,481 1,301 5,034 — 9,120 1,301 14,154 15,455 7,166 09/2004 (1), (2), (3) Hampton Inn Parsippany, NJ 16,997 3,268 24,306 — (410) 3,268 23,896 27,164 6,846 03/2015 (1), (2), (3) Marriott Beverly Hills,CA 90,000 6,510 22,061 — 2,143 6,510 24,204 30,714 12,877 03/2005 (1), (2), (3) Marriott Arlington, VA 121,500 20,637 101,376 — 8,354 20,637 109,730 130,367 55,356 07/2006 (1), (2), (3) Marriott Dallas, TX 18,500 2,701 30,893 — 6,274 2,701 37,167 39,868 17,004 04/2007 (1), (2), (3) Marriott Fremont, CA 40,000 5,800 44,200 — 9,827 5,800 54,027 59,827 20,315 08/2014 (1), (2), (3) Marriott Memphis, TN 18,000 6,210 37,284 — (2,143) 6,210 35,141 41,351 10,267 02/2015 (1), (2), (3) Marriott Irving, TX 60,775 8,330 82,272 — 12,897 8,330 95,169 103,499 34,187 03/2015 (1), (2), (3) Marriott Omaha, NE 14,450 6,641 49,887 — 1,068 6,641 50,955 57,596 16,378 03/2015 (1), (2), (3) Marriott Sugarland, TX 56,807 9,047 84,043 — 14,493 9,047 98,536 107,583 30,215 03/2015 (1), (2), (3) (6) (7) (7) (4) (4) 154
Page 161
Column A Column B Column C Column D Column E Column F Column G Column H Column I Initial Cost Costs CapitalizedSince Acquisition Gross Carrying AmountAt Close of Period HotelProperty Location Encumbrances Land FF&E,Buildings andImprovements Land FF&E,Buildings andImprovements Land FF&E,Buildings andImprovements Total AccumulatedDepreciation ConstructionDate AcquisitionDate IncomeStatement Courtyardby Marriott Bloomington,IN 13,432 900 10,741 — 7,789 900 18,530 19,430 7,676 09/2004 (1), (2),(3) Courtyardby Marriott Denver, CO 30,432 9,342 29,656 — (1,153) 9,342 28,503 37,845 8,444 03/2015 (1), (2),(3) Courtyardby Marriott Gaithersburg,MD 26,059 5,128 30,522 — (362) 5,128 30,160 35,288 8,573 03/2015 (1), (2),(3) Courtyardby Marriott Crystal City,VA 40,101 5,411 38,610 — 3,406 5,411 42,016 47,427 22,507 06/2005 (1), (2),(3) Courtyardby Marriott OverlandPark, KS 9,500 1,868 14,030 — 1,664 1,868 15,694 17,562 8,095 06/2005 (1), (2),(3) Courtyardby Marriott FoothillRanch, CA 20,490 2,447 16,005 — 1,154 2,447 17,159 19,606 9,071 06/2005 (1), (2),(3) Courtyardby Marriott Alpharetta,GA 18,538 2,244 12,345 — 1,691 2,244 14,036 16,280 7,478 06/2005 (1), (2),(3) MarriottResidenceInn Orlando, FL 35,000 6,554 40,539 (380) 4,536 6,174 45,075 51,249 24,574 06/2005 (1), (2),(3) MarriottResidenceInn Falls Church,VA 24,652 2,752 34,979 — 3,798 2,752 38,777 41,529 20,695 06/2005 (1), (2),(3) TributePortfolio Santa Fe,NM 35,697 8,094 42,058 — 3,428 8,094 45,486 53,580 9,744 10/2018 (1), (2),(3) Ritz-Carlton Atlanta, GA 89,269 2,477 80,139 — 8,345 2,477 88,484 90,961 28,071 03/2015 (1), (2),(3) Renaissance Nashville,TN 306,946 20,671 158,260 — 20,662 20,671 178,922 199,593 57,552 03/2015 (1), (2),(3) Renaissance PalmSprings, CA 46,979 — 74,112 — (1,294) — 72,818 72,818 21,146 03/2015 (1), (2),(3) SheratonHotel Minneapolis,MN 17,223 2,953 14,280 (51) 1,732 2,902 16,012 18,914 8,352 03/2005 (1), (2),(3) SheratonHotel Indianapolis,IN 55,882 3,100 22,041 — 19,422 3,100 41,463 44,563 16,445 03/2005 (1), (2),(3) SheratonHotel Anchorage,AK 41,500 4,023 39,363 — 13,202 4,023 52,565 56,588 22,166 12/2006 (1), (2),(3) SheratonHotel San Diego,CA 32,800 7,294 36,382 — 10,643 7,294 47,025 54,319 19,612 12/2006 (1), (2),(3) HyattRegency Coral Gables,FL 84,000 4,805 50,820 — 10,564 4,805 61,384 66,189 31,074 04/2007 (1), (2),(3) HyattRegency Hauppauge,NY 32,912 6,284 35,669 — (2,210) 6,284 33,459 39,743 13,080 03/2015 (1), (2),(3) HyattRegency Savannah,GA 63,119 14,041 72,721 — 1,952 14,041 74,673 88,714 22,640 03/2015 (1), (2),(3) CrownPlaza Key West,FL 53,466 — 27,514 — 38,372 — 65,886 65,886 29,320 03/2005 (1), (2),(3) AnnapolisHistoric Inn Annapolis,MD 15,352 3,028 7,833 — 1,658 3,028 9,491 12,519 4,966 03/2005 (1), (2),(3) LakewayResort &Spa Austin, TX 33,000 4,541 28,940 — (487) 4,541 28,453 32,994 10,780 02/2015 (1), (2),(3) Silversmith Chicago, IL 25,293 4,782 22,398 — (849) 4,782 21,549 26,331 7,362 03/2015 (1), (2),(3) TheChurchill Washington,DC 37,488 25,898 32,304 — 421 25,898 32,725 58,623 9,586 03/2015 (1), (2),(3) TheMelrose Washington,DC 68,800 29,277 62,507 — (1,794) 29,277 60,713 89,990 17,135 03/2015 (1), (2),(3) Westin Princeton, NJ 45,000 6,475 52,195 — 4,428 6,475 56,623 63,098 15,934 03/2015 (1), (2),(3) AtlantaHotel Indigo Atlanta, GA 12,329 3,230 23,713 — 2,139 3,230 25,852 29,082 8,383 10/2015 (1), (2),(3) LeMeridien Ft. Worth,TX 15,660 4,609 82,749 (9) (4,562) 4,600 78,187 82,787 5,558 08/2024 (1), (2),(3) HamptonInn Buford, GA 10,000 1,168 5,338 — 3,734 1,168 9,072 10,240 6,237 07/2004 (1), (2),(3) SpringHillSuites byMarriott Buford, GA 4,500 1,132 6,089 — 7,191 1,132 13,280 14,412 7,134 07/2004 (1), (2),(3) MarriottResidenceInn Manchester,CT 7,700 1,462 8,306 — 7,087 1,462 15,393 16,855 6,975 04/2007 (1), (2),(3) MarriottResidenceInn Jacksonville,FL 8,000 1,997 16,084 — 4,665 1,997 20,749 22,746 11,709 05/2007 (1), (2),(3) Total $ 2,586,885 $435,762 $ 2,492,201 $(22,299) $ 180,865 $413,463 $ 2,673,066 $3,086,529 $ 999,521 _________________________ Estimated useful life for buildings is 39 years. Estimated useful life for building improvements is 7.5 years. Estimated useful life for furniture and fixtures is 1.5 to 5 years. (6) (5) (1) (2) (3) 155
Page 162
Amounts include impairment charges. Total includes properties held for sale as of December 31, 2025 and excludes the Hilton Marietta as it is operated through a lease. The cost of land and depreciable property, net of accumulated depreciation, for U.S. federal income tax purposes was approximately $2.2 billion as of December 31, 2025. Hotel property was held for sale as of December 31, 2025. Year Ended December 31, 2025 2024 2023 Investment in Real Estate: Beginning balance $3,350,086 $4,245,264 $4,546,384 Additions 71,736 102,232 206,737 Impairment/write-offs (209,807) (255,732) (194,343) Sales/disposals (108,181) (631,383) (292,268) Assets held for sale (34,818) (110,295) (21,246) Ending balance $3,069,016 $3,350,086 $4,245,264 Accumulated Depreciation: Beginning balance 1,030,879 1,293,332 1,428,053 Depreciation expense 144,289 152,832 188,021 Impairment/write-offs (142,122) (196,402) (194,343) Sales/disposals (31,883) (195,710) (119,102) Assets held for sale (17,391) (23,173) (9,297) Ending balance $ 983,772 $1,030,879 $1,293,332 Investment in Real Estate, net $2,085,244 $2,319,207 $2,951,932 (4) (5) (6) (7) 156
Page 163
EXHIBIT 4.11 DESCRIPTION OF SECURITIES REGISTERED PURSUANT TO SECTION 12 OF THE SECURITIES EXCHANGE ACT OF 1934 As of December 31, 2025, Ashford Hospitality Trust Inc. (“we,” “us,” “our” and the “Company”) has seven classes of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”): (1) our Common Stock; (2) our Series D Preferred Stock; (3) our Series F Preferred Stock; (4) our Series G Preferred Stock; (5) our Series H Preferred Stock; and (6) our Series I Preferred Stock; and (7) our Preferred Stock Purchase Rights. The following description of our capital stock is a summary and does not purport to be complete. It is subject to and qualified in its entirety by reference to our (i) Articles of Amendment and Restatement, as amended by Amendment Number One to Articles of Amendment and Restatement and Amendment Number Two to Articles of Amendment and Restatement, (ii) Articles Supplementary for Series D Cumulative Preferred Stock, (iii) Articles Supplementary for Series F Cumulative Preferred Stock, (iv) Articles Supplementary for Series G Cumulative Preferred Stock, (v) Articles Supplementary for Series H Cumulative Preferred Stock, (vi) Articles Supplementary for Series I Cumulative Preferred Stock, (vii) Articles Supplementary for Series J Redeemable Preferred Stock, (viii) Articles Supplementary for Series K Redeemable Preferred Stock, and (ix) Articles Supplementary for Series N Junior Participating Preferred Stock (all of the foregoing collectively referred to as our “charter”), (x) Second Amended and Restated Bylaws, as amended (the “bylaws”), and (xi) the Rights Agreement, dated as of December 15, 2025, between the Company and Computershare Trust Company, N.A., as Rights Agent (the “Rights Agreement”), each of which is incorporated by reference as an exhibit to the Annual Report on Form 10-K of which this Exhibit 4.11 is a part. We encourage you to read our charter, our bylaws and the applicable provisions of the Maryland General Corporation Law (“MGCL”) for additional information. Description of Common Stock Authorized Capital Shares Our authorized capital shares consist of 395,000,000 shares of common stock, par value $0.01 per share (“Common Stock”) and 55,000,000 shares of preferred stock, par value $0.01 per share (“Preferred Stock”). All outstanding shares of our Common Stock are fully paid and nonassessable. Voting Rights Subject to the provisions of our charter regarding the restrictions on transfer of stock, each outstanding share of our Common Stock entitles the holder to one vote on all matters submitted to a vote of stockholders, including the election of directors and, except as provided with respect to any other class or series of stock, the holders of such shares will possess the exclusive voting power. Director nominees in an uncontested election are elected if the votes cast for such nominee’s election exceed the votes cast against such nominee’s election (with abstentions and broker non-votes not counted as a vote cast either “for” or “against” that director’s election). In the event of a contested election, as defined in our charter, a plurality voting standard will apply. Dividend Rights Subject to the preferential rights of any other class or series of stock and to the provisions of the charter regarding the restrictions on transfer of stock, holders of shares of our Common Stock are entitled to receive dividends on such stock when, as and if authorized by our board of directors out of funds legally available therefor. Liquidation Rights Subject to the preferential rights of any other class or series of stock, holders of shares of our Common Stock are entitled to share ratably in the assets of our Company legally available for distribution to our stockholders in the event of our liquidation, dissolution or winding up after payment of or adequate provision for all known debts and liabilities of our Company, including the preferential rights on dissolution of any class or classes of Preferred Stock. Other Rights and Preferences Holders of shares of our Common Stock have no preference, conversion, exchange, sinking fund, or redemption and have no preemptive rights to subscribe for any securities of our Company, and generally have no appraisal rights so long as our Common Stock is listed on a national securities exchange and except in very limited circumstances involving a merger where our stock is converted into any consideration other than stock of the successor in the merger and in which our directors, officers, and 5% or greater stockholders receive different consideration than stockholders generally. Subject to the provisions of
Page 164
the charter regarding the restrictions on transfer of stock, shares of our Common Stock will have equal dividend, liquidation and other rights. Under the MGCL, a Maryland corporation generally cannot dissolve, amend its charter, merge, consolidate, transfer all or substantially all of its assets, engage in a statutory share exchange or engage in similar transactions outside the ordinary course of business unless declared advisable by the board of directors and approved by the affirmative vote of stockholders holding at least two-thirds of the shares entitled to vote on the matter unless a lesser percentage (but not less than a majority of all of the votes entitled to be cast on the matter) is set forth in the corporation’s charter. Our charter does not contain a provision reducing the required vote below the threshold established under the MGCL. Because operating assets may be held by a corporation’s subsidiaries, as in our situation, a subsidiary of a corporation may be able to merge or transfer all of its assets without a vote of our stockholders. Subject to the provisions of the charter regarding the restrictions on transfer of stock, we are not aware of any limitations on the rights to own our Common Stock, including rights of non-resident or foreign stockholders to hold or exercise voting rights on our Common Stock, imposed by foreign law or by our charter or bylaws. Listing The Common Stock is traded on the New York Stock Exchange (the “NYSE”) under the trading symbol “AHT.” Description of the Series D Preferred Stock Authorized Capital Shares Our board of directors has classified and designated 1,174,427 shares of 8.45% Series D Cumulative Preferred Stock, par value $0.01 per share (“Series D Preferred Stock”). All outstanding shares of our Series D Preferred Stock are fully paid and nonassessable. Ranking The Series D Preferred Stock will, with respect to dividend rights and rights upon liquidation, dissolution or winding up of our affairs rank: • senior to all classes or series of Common Stock and to all equity securities ranking junior to the preferred stock with respect to dividend rights or rights upon liquidation, dissolution or winding up of our affairs; • on a parity with all equity securities issued by us the terms of which specifically provide that those equity securities rank on a parity with the preferred stock with respect to dividend rights or rights upon liquidation, dissolution or winding up of our affairs; and • junior to all equity securities issued by us the terms of which specifically provide that those equity securities rank senior to the preferred stock with respect to dividend rights or rights upon liquidation, dissolution or winding up of our affairs. The term “equity securities” does not include convertible debt securities. Our Series D Preferred Stock, Series F Preferred Stock, Series G Preferred Stock, Series H Preferred Stock, and Series I Preferred Stock all rank on a parity with one another. Voting Rights Holders of Series D Preferred Stock generally have no voting rights, except that if six or more quarterly dividend payments have not been made, our board of directors will be expanded by two seats and the holders of Series D Preferred Stock, voting together as a single class with the holders of all other series of preferred stock that has been granted similar voting rights and is considered parity stock with the Series D Preferred Stock, will be entitled to elect these two directors. In addition, the issuance of senior shares or certain changes to the terms of the Series D Preferred Stock that would be materially adverse to the rights of holders of Series D Preferred Stock cannot be made without the affirmative vote of holders of at least 66 2/3% of the outstanding Series D Preferred Stock and shares of any class or series of shares ranking on a parity with the Series D Preferred Stock which are entitled to similar voting rights, if any, voting as a single class. Dividend Rights 2
Page 165
The Series D Preferred Stock provides for a cumulative cash dividend at an annual rate of 8.45% on the $25.00 per share liquidation preference; provided, however, that during any period of time that both (i) the Series D Preferred Stock is not listed on either the NYSE, NYSE American LLC (the “NYSE American”), or the NASDAQ Stock Market (“NASDAQ”), or on a successor exchange and (ii) we are not subject to the reporting requirements of the Exchange Act, the Series D Preferred Stock will accrue a cumulative cash dividend at an annual rate of 9.45% on the $25.00 per share liquidation preference (equivalent to an annual dividend rate of $2.3625 per share), which we refer to as a special distribution. Liquidation Rights Upon any voluntary or involuntary liquidation, dissolution or winding up of our Company, the holders of Series D Preferred Stock will be entitled to receive a liquidation preference of $25.00 per share, plus an amount equal to all accumulated, accrued and unpaid dividends (whether or not earned or declared) to the date of liquidation, dissolution or winding up of the affairs of our Company, before any payment or distribution will be made to or set apart for the holders of any junior stock. Other Rights and Preferences The Series D Preferred Stock is not convertible or exchangeable for any of our other securities or property, and holders of shares of our Series D Preferred Stock have no preemptive rights to subscribe for any securities of our Company. Holders of Series D Preferred Stock do not have redemption rights. Our Series D Preferred Stock is not subject to any sinking fund provisions. During any period in which we are required to pay a special distribution, holders of the Series D Preferred Stock will become entitled to certain information rights related thereto. Subject to the provisions of the charter regarding the restrictions on transfer of stock, we are not aware of any limitations on the rights to own our Series D Preferred Stock, including rights of non-resident or foreign stockholders to hold or exercise voting rights on our Series D Preferred Stock, imposed by foreign law or by our charter or bylaws. Listing The Series D Preferred Stock is traded on the NYSE under the trading symbol “AHT-PD.” Description of the Series F Preferred Stock Authorized Capital Shares Our board of directors has classified and designated 1,251,044 shares of 7.375% Series F Cumulative Preferred Stock, par value $0.01 per share (“Series F Preferred Stock”). All outstanding shares of our Series F Preferred Stock are fully paid and nonassessable. Ranking The Series F Preferred Stock will, with respect to dividend rights and rights upon liquidation, dissolution or winding up of our affairs rank: • senior to all classes or series of Common Stock and to all equity securities ranking junior to the preferred stock with respect to dividend rights or rights upon liquidation, dissolution or winding up of our affairs; • on a parity with all equity securities issued by us the terms of which specifically provide that those equity securities rank on a parity with the preferred stock with respect to dividend rights or rights upon liquidation, dissolution or winding up of our affairs; and • junior to all equity securities issued by us the terms of which specifically provide that those equity securities rank senior to the preferred stock with respect to dividend rights or rights upon liquidation, dissolution or winding up of our affairs. The term “equity securities” does not include convertible debt securities. Voting Rights Holders of Series F Preferred Stock generally have no voting rights, except that if six or more quarterly dividend payments have not been made, our board of directors will be expanded by two seats and the holders of Series F Preferred Stock, voting together 3
Page 166
as a single class with the holders of all other series of Preferred Stock that has been granted similar voting rights and is considered parity stock with the Series F Preferred Stock, will be entitled to elect these two directors. In addition, the issuance of senior shares or certain changes to the terms of the Series F Preferred Stock that would be materially adverse to the rights of holders of Series F Preferred Stock cannot be made without the affirmative vote of holders of at least 66 2/3% of the outstanding Series F Preferred Stock and shares of any class or series of shares ranking on a parity with the Series F Preferred Stock which are entitled to similar voting rights, if any, voting as a single class. Dividend Rights The Series F Preferred Stock provides for a cumulative cash dividend at an annual rate of 7.375% on the $25.00 per share liquidation preference. Liquidation Rights Upon any voluntary or involuntary liquidation, dissolution or winding up of our Company, the holders of Series F Preferred Stock will be entitled to receive a liquidation preference of $25.00 per share, plus an amount equal to all accumulated, accrued and unpaid dividends (whether or not earned or declared) to the date of liquidation, dissolution or winding up of the affairs of our Company, before any payment or distribution will be made to or set apart for the holders of any junior stock. Redemption Provisions Upon the occurrence of a Change of Control (as defined below), we may, at our option, redeem the Series F Preferred Stock, in whole or in part within 120 days after the first date on which such Change of Control occurred, by paying $25.00 per share, plus any accrued and unpaid dividends to, but not including, the date of redemption. If, prior to the Change of Control conversion date, we exercise any of our redemption rights relating to the Series F Preferred Stock (whether our optional redemption right or our special optional redemption right), the holders of Series F Preferred Stock will not have the conversion right described below. A “Change of Control” is when, after the original issuance of the Series F Preferred Stock, the following have occurred and are continuing: • the acquisition by any person, including any syndicate or group deemed to be a “person” under Section 13(d)(3) of the Exchange Act, of beneficial ownership, directly or indirectly, through a purchase, merger or other acquisition transaction or series of purchases, mergers or other acquisition transactions of shares of our Company entitling that person to exercise more than 50% of the total voting power of all shares of our Company entitled to vote generally in elections of directors (except that such person will be deemed to have beneficial ownership of all securities that such person has the right to acquire, whether such right is currently exercisable or is exercisable only upon the occurrence of a subsequent condition); and • following the closing of any transaction referred to in the bullet point above, neither we nor the acquiring or surviving entity has a class of common securities (or American Depository Receipts (“ADRs”) representing such securities) listed on the NYSE, the NYSE American or NASDAQ or listed or quoted on an exchange or quotation system that is a successor to the NYSE, the NYSE American or NASDAQ. In addition, we may redeem the Series F Preferred Stock, in whole or from time to time in part, at a cash redemption price equal to 100% of the $25.00 per share liquidation preference plus all accrued and unpaid dividends to the date fixed for redemption. The Series F Preferred Stock has no stated maturity and is not subject to any sinking fund or mandatory redemption provisions. Conversion Rights Upon the occurrence of a Change of Control, each holder of Series F Preferred Stock will have the right (unless, prior to the Change of Control conversion date, we have provided or provide notice of our election to redeem the Series F Preferred Stock) to convert some or all of the Series F Preferred Stock held by such holder on the Change of Control conversion date into a number of shares of our Common Stock per share of Series F Preferred Stock to be converted equal to the lesser of: • the quotient obtained by dividing (i) the sum of the $25.00 liquidation preference plus the amount of any accrued and unpaid dividends to, but not including, the Change of Control conversion date (unless the Change of Control conversion date is after a dividend record date for the Series F Preferred Stock and prior to the corresponding Series F Preferred Stock dividend payment date, in which case no additional amount for such accrued and unpaid dividend will be included in this sum) by (ii) the Common Stock Price (as defined below); and 4
Page 167
• 0.00968992 (the “Share Cap”), subject to certain adjustments; subject, in each case, to provisions for the receipt of alternative consideration. The “Common Stock Price” will be (i) the amount of cash consideration per share of Common Stock, if the consideration to be received in the Change of Control by the holders of our Common Stock is solely cash; or (ii) the average of the closing prices for our Common Stock on the NYSE for the ten consecutive trading days immediately preceding, but not including, the effective date of the Change of Control, if the consideration to be received in the Change of Control by the holders of our Common Stock is other than solely cash. If, prior to the Change of Control conversion date, we have provided or provide a redemption notice, whether pursuant to our special optional redemption right in connection with a Change of Control or our optional redemption right, holders of Series F Preferred Stock will not have any right to convert the Series F Preferred Stock in connection with the Change of Control conversion right and any shares of Series F Preferred Stock selected for redemption that have been tendered for conversion will be redeemed on the related date of redemption instead of converted on the Change of Control conversion date. Except as provided above in connection with a Change of Control, the Series F Preferred Stock is not convertible into or exchangeable for any other securities or property. Other Rights and Preferences Holders of shares of our Series F Preferred Stock have no preemptive rights to subscribe for any securities of our Company. Subject to the provisions of the charter regarding the restrictions on transfer of stock, we are not aware of any limitations on the rights to own our Series F Preferred Stock, including rights of non-resident or foreign stockholders to hold or exercise voting rights on our Series F Preferred Stock, imposed by foreign law or by our charter or bylaws. Listing The Series F Preferred Stock is traded on the NYSE under the trading symbol “AHT-PF.” Description of the Series G Preferred Stock Authorized Capital Shares Our board of directors has classified and designated 1,531,996 shares of 7.375% Series G Cumulative Preferred Stock, par value $0.01 per share (“Series G Preferred Stock”). All outstanding shares of our Series G Preferred Stock are fully paid and nonassessable. Ranking The Series G Preferred Stock will, with respect to dividend rights and rights upon liquidation, dissolution or winding up of our affairs rank: • senior to all classes or series of Common Stock and to all equity securities ranking junior to the preferred stock with respect to dividend rights or rights upon liquidation, dissolution or winding up of our affairs; • on a parity with all equity securities issued by us the terms of which specifically provide that those equity securities rank on a parity with the preferred stock with respect to dividend rights or rights upon liquidation, dissolution or winding up of our affairs; and • junior to all equity securities issued by us the terms of which specifically provide that those equity securities rank senior to the preferred stock with respect to dividend rights or rights upon liquidation, dissolution or winding up of our affairs. The term “equity securities” does not include convertible debt securities. Voting Rights Holders of Series G Preferred Stock generally have no voting rights, except that if six or more quarterly dividend payments have not been made, our board of directors will be expanded by two seats and the holders of Series G Preferred Stock, voting together as a single class with the holders of all other series of Preferred Stock that has been granted similar voting rights and is considered parity stock with the Series G Preferred Stock, will be entitled to elect these two directors. In addition, the issuance of senior shares or certain changes to the terms of the Series G Preferred Stock that would be materially adverse to the rights of holders of Series G Preferred Stock cannot be made without the affirmative vote of holders of at least 66 2/3% of the 5
Page 168
outstanding Series G Preferred Stock and shares of any class or series of shares ranking on a parity with the Series G Preferred Stock which are entitled to similar voting rights, if any, voting as a single class. Dividend Rights The Series G Preferred Stock provides for a cumulative cash dividend at an annual rate of 7.375% on the $25.00 per share liquidation preference. Liquidation Rights Upon any voluntary or involuntary liquidation, dissolution or winding up of our Company, the holders of Series G Preferred Stock will be entitled to receive a liquidation preference of $25.00 per share, plus an amount equal to all accumulated, accrued and unpaid dividends (whether or not earned or declared) to the date of liquidation, dissolution or winding up of the affairs of our Company, before any payment or distribution will be made to or set apart for the holders of any junior stock. Redemption Provisions Upon the occurrence of a Change of Control (as defined below), we may, at our option, redeem the Series G Preferred Stock, in whole or in part within 120 days after the first date on which such Change of Control occurred, by paying $25.00 per share, plus any accrued and unpaid dividends to, but not including, the date of redemption. If, prior to the Change of Control conversion date, we exercise any of our redemption rights relating to the Series G Preferred Stock (whether our optional redemption right or our special optional redemption right), the holders of Series G Preferred Stock will not have the conversion right described below. A “Change of Control” is when, after the original issuance of the Series G Preferred Stock, the following have occurred and are continuing: • the acquisition by any person, including any syndicate or group deemed to be a “person” under Section 13(d)(3) of the Exchange Act, of beneficial ownership, directly or indirectly, through a purchase, merger or other acquisition transaction or series of purchases, mergers or other acquisition transactions of shares of our Company entitling that person to exercise more than 50% of the total voting power of all shares of our Company entitled to vote generally in elections of directors (except that such person will be deemed to have beneficial ownership of all securities that such person has the right to acquire, whether such right is currently exercisable or is exercisable only upon the occurrence of a subsequent condition); and • following the closing of any transaction referred to in the bullet point above, neither we nor the acquiring or surviving entity has a class of common securities (or ADRs representing such securities) listed on the NYSE, the NYSE American or NASDAQ or listed or quoted on an exchange or quotation system that is a successor to the NYSE, the NYSE American or NASDAQ. In addition, we may redeem the Series G Preferred Stock, in whole or from time to time in part, at a cash redemption price equal to 100% of the $25.00 per share liquidation preference plus all accrued and unpaid dividends to the date fixed for redemption. The Series G Preferred Stock has no stated maturity and is not subject to any sinking fund or mandatory redemption provisions. Conversion Rights Upon the occurrence of a Change of Control, each holder of Series G Preferred Stock will have the right (unless, prior to the Change of Control conversion date, we have provided or provide notice of our election to redeem the Series G Preferred Stock) to convert some or all of the Series G Preferred Stock held by such holder on the Change of Control conversion date into a number of shares of our Common Stock per share of Series G Preferred Stock to be converted equal to the lesser of: • the quotient obtained by dividing (i) the sum of the $25.00 liquidation preference plus the amount of any accrued and unpaid dividends to, but not including, the Change of Control conversion date (unless the Change of Control conversion date is after a dividend record date for the Series G Preferred Stock and prior to the corresponding Series G Preferred Stock dividend payment date, in which case no additional amount for such accrued and unpaid dividend will be included in this sum) by (ii) the Common Stock Price (as defined below); and • 0.0083333 (the “Share Cap”), subject to certain adjustments; 6
Page 169
subject, in each case, to provisions for the receipt of alternative consideration. The “Common Stock Price” will be (i) the amount of cash consideration per share of Common Stock, if the consideration to be received in the Change of Control by the holders of our Common Stock is solely cash; or (ii) the average of the closing prices for our Common Stock on the NYSE for the ten consecutive trading days immediately preceding, but not including, the effective date of the Change of Control, if the consideration to be received in the Change of Control by the holders of our Common Stock is other than solely cash. If, prior to the Change of Control conversion date, we have provided or provide a redemption notice, whether pursuant to our special optional redemption right in connection with a Change of Control or our optional redemption right, holders of Series G Preferred Stock will not have any right to convert the Series G Preferred Stock in connection with the Change of Control conversion right and any shares of Series G Preferred Stock selected for redemption that have been tendered for conversion will be redeemed on the related date of redemption instead of converted on the Change of Control conversion date. Except as provided above in connection with a Change of Control, the Series G Preferred Stock is not convertible into or exchangeable for any other securities or property. Other Rights and Preferences Holders of shares of our Series G Preferred Stock have no preemptive rights to subscribe for any securities of our Company. Subject to the provisions of the charter regarding the restrictions on transfer of stock, we are not aware of any limitations on the rights to own our Series G Preferred Stock, including rights of non-resident or foreign stockholders to hold or exercise voting rights on our Series G Preferred Stock, imposed by foreign law or by our charter or bylaws. Listing The Series G Preferred Stock is traded on the NYSE under the trading symbol “AHT-PG.” Description of the Series H Preferred Stock Authorized Capital Shares Our board of directors has classified and designated 1,308,415 shares of 7.50% Series H Cumulative Preferred Stock, par value $0.01 per share (“Series H Preferred Stock”). All outstanding shares of our Series H Preferred Stock are fully paid and nonassessable. Ranking The Series H Preferred Stock will, with respect to dividend rights and rights upon liquidation, dissolution or winding up of our affairs rank: • senior to all classes or series of Common Stock and to all equity securities ranking junior to the preferred stock with respect to dividend rights or rights upon liquidation, dissolution or winding up of our affairs; • on a parity with all equity securities issued by us the terms of which specifically provide that those equity securities rank on a parity with the preferred stock with respect to dividend rights or rights upon liquidation, dissolution or winding up of our affairs; and • junior to all equity securities issued by us the terms of which specifically provide that those equity securities rank senior to the preferred stock with respect to dividend rights or rights upon liquidation, dissolution or winding up of our affairs. The term “equity securities” does not include convertible debt securities. Voting Rights Holders of Series H Preferred Stock generally have no voting rights, except that if six or more quarterly dividend payments have not been made, our board of directors will be expanded by two seats and the holders of Series H Preferred Stock, voting together as a single class with the holders of all other series of Preferred Stock that has been granted similar voting rights and is considered parity stock with the Series H Preferred Stock, will be entitled to elect these two directors. In addition, the issuance of senior shares or certain changes to the terms of the Series H Preferred Stock that would be materially adverse to the rights of holders of Series H Preferred Stock cannot be made without the affirmative vote of holders of at least 66 2/3% of the outstanding Series H Preferred Stock and shares of any class or series of shares ranking on a parity with the Series H Preferred Stock which are entitled to similar voting rights, if any, voting as a single class. 7
Page 170
Dividend Rights The Series H Preferred Stock provides for a cumulative cash dividend at an annual rate of 7.50% on the $25.00 per share liquidation preference. Liquidation Rights Upon any voluntary or involuntary liquidation, dissolution or winding up of our Company, the holders of Series H Preferred Stock will be entitled to receive a liquidation preference of $25.00 per share, plus an amount equal to all accumulated, accrued and unpaid dividends (whether or not earned or declared) to the date of liquidation, dissolution or winding up of the affairs of our Company, before any payment or distribution will be made to or set apart for the holders of any junior stock. Redemption Provisions Upon the occurrence of a Change of Control (as defined below), we may, at our option, redeem the Series H Preferred Stock, in whole or in part within 120 days after the first date on which such Change of Control occurred, by paying $25.00 per share, plus any accrued and unpaid dividends to, but not including, the date of redemption. If, prior to the Change of Control conversion date, we exercise any of our redemption rights relating to the Series H Preferred Stock (whether our optional redemption right or our special optional redemption right), the holders of Series H Preferred Stock will not have the conversion right described below. A “Change of Control” is when, after the original issuance of the Series H Preferred Stock, the following have occurred and are continuing: • the acquisition by any person, including any syndicate or group deemed to be a “person” under Section 13(d)(3) of the Exchange Act, of beneficial ownership, directly or indirectly, through a purchase, merger or other acquisition transaction or series of purchases, mergers or other acquisition transactions of shares of our Company entitling that person to exercise more than 50% of the total voting power of all shares of our Company entitled to vote generally in elections of directors (except that such person will be deemed to have beneficial ownership of all securities that such person has the right to acquire, whether such right is currently exercisable or is exercisable only upon the occurrence of a subsequent condition); and • following the closing of any transaction referred to in the bullet point above, neither we nor the acquiring or surviving entity has a class of common securities (or ADRs representing such securities) listed on the NYSE, the NYSE American or NASDAQ or listed or quoted on an exchange or quotation system that is a successor to the NYSE, the NYSE American or NASDAQ. In addition, we may redeem the Series H Preferred Stock, in whole or from time to time in part, at a cash redemption price equal to 100% of the $25.00 per share liquidation preference plus all accrued and unpaid dividends to the date fixed for redemption. The Series H Preferred Stock has no stated maturity and is not subject to any sinking fund or mandatory redemption provisions. Conversion Rights Upon the occurrence of a Change of Control, each holder of Series H Preferred Stock will have the right (unless, prior to the Change of Control conversion date, we have provided or provide notice of our election to redeem the Series H Preferred Stock) to convert some or all of the Series H Preferred Stock held by such holder on the Change of Control conversion date into a number of shares of our Common Stock per share of Series H Preferred Stock to be converted equal to the lesser of: • the quotient obtained by dividing (i) the sum of the $25.00 liquidation preference plus the amount of any accrued and unpaid dividends to, but not including, the Change of Control conversion date (unless the Change of Control conversion date is after a dividend record date for the Series H Preferred Stock and prior to the corresponding Series H Preferred Stock dividend payment date, in which case no additional amount for such accrued and unpaid dividend will be included in this sum) by (ii) the Common Stock Price (as defined below); and • 0.00825083 (the “Share Cap”), subject to certain adjustments; subject, in each case, to provisions for the receipt of alternative consideration. The “Common Stock Price” will be (i) the amount of cash consideration per share of Common Stock, if the consideration to be received in the Change of Control by the holders of our Common Stock is solely cash; or (ii) the average of the closing prices for our Common Stock on the NYSE for 8
Page 171
the ten consecutive trading days immediately preceding, but not including, the effective date of the Change of Control, if the consideration to be received in the Change of Control by the holders of our Common Stock is other than solely cash. If, prior to the Change of Control conversion date, we have provided or provide a redemption notice, whether pursuant to our special optional redemption right in connection with a Change of Control or our optional redemption right, holders of Series H Preferred Stock will not have any right to convert the Series H Preferred Stock in connection with the Change of Control conversion right and any shares of Series H Preferred Stock selected for redemption that have been tendered for conversion will be redeemed on the related date of redemption instead of converted on the Change of Control conversion date. Except as provided above in connection with a Change of Control, the Series H Preferred Stock is not convertible into or exchangeable for any other securities or property. Other Rights and Preferences Holders of shares of our Series H Preferred Stock have no preemptive rights to subscribe for any securities of our Company. Subject to the provisions of the charter regarding the restrictions on transfer of stock, we are not aware of any limitations on the rights to own our Series H Preferred Stock, including rights of non-resident or foreign stockholders to hold or exercise voting rights on our Series H Preferred Stock, imposed by foreign law or by our charter or bylaws. Listing The Series H Preferred Stock is traded on the NYSE under the trading symbol “AHT-PH.” Description of the Series I Preferred Stock Authorized Capital Shares Our board of directors has classified and designated 1,252,923 shares of 7.50% Series I Cumulative Preferred Stock, par value $0.01 per share (“Series I Preferred Stock”). All outstanding shares of our Series I Preferred Stock are fully paid and nonassessable. Ranking The Series I Preferred Stock will, with respect to dividend rights and rights upon liquidation, dissolution or winding up of our affairs rank: • senior to all classes or series of Common Stock and to all equity securities ranking junior to the preferred stock with respect to dividend rights or rights upon liquidation, dissolution or winding up of our affairs; • on a parity with all equity securities issued by us the terms of which specifically provide that those equity securities rank on a parity with the preferred stock with respect to dividend rights or rights upon liquidation, dissolution or winding up of our affairs; and • junior to all equity securities issued by us the terms of which specifically provide that those equity securities rank senior to the preferred stock with respect to dividend rights or rights upon liquidation, dissolution or winding up of our affairs. The term “equity securities” does not include convertible debt securities. Voting Rights Holders of Series I Preferred Stock generally have no voting rights, except that if six or more quarterly dividend payments have not been made, our board of directors will be expanded by two seats and the holders of Series I Preferred Stock, voting together as a single class with the holders of all other series of Preferred Stock that has been granted similar voting rights and is considered parity stock with the Series I Preferred Stock, will be entitled to elect these two directors. In addition, the issuance of senior shares or certain changes to the terms of the Series I Preferred Stock that would be materially adverse to the rights of holders of Series I Preferred Stock cannot be made without the affirmative vote of holders of at least 66 2/3% of the outstanding Series I Preferred Stock and shares of any class or series of shares ranking on a parity with the Series I Preferred Stock which are entitled to similar voting rights, if any, voting as a single class. 9
Page 172
Dividend Rights The Series I Preferred Stock provides for a cumulative cash dividend at an annual rate of 7.50% on the $25.00 per share liquidation preference. Liquidation Rights Upon any voluntary or involuntary liquidation, dissolution or winding up of our Company, the holders of Series I Preferred Stock will be entitled to receive a liquidation preference of $25.00 per share, plus an amount equal to all accumulated, accrued and unpaid dividends (whether or not earned or declared) to the date of liquidation, dissolution or winding up of the affairs of our Company, before any payment or distribution will be made to or set apart for the holders of any junior stock. Redemption Provisions Upon the occurrence of a Change of Control (as defined below), we may, at our option, redeem the Series I Preferred Stock, in whole or in part within 120 days after the first date on which such Change of Control occurred, by paying $25.00 per share, plus any accrued and unpaid dividends to, but not including, the date of redemption. If, prior to the Change of Control conversion date, we exercise any of our redemption rights relating to the Series I Preferred Stock (whether our optional redemption right or our special optional redemption right), the holders of Series I Preferred Stock will not have the conversion right described below. A “Change of Control” is when, after the original issuance of the Series I Preferred Stock, the following have occurred and are continuing: • the acquisition by any person, including any syndicate or group deemed to be a “person” under Section 13(d)(3) of the Exchange Act, of beneficial ownership, directly or indirectly, through a purchase, merger or other acquisition transaction or series of purchases, mergers or other acquisition transactions of shares of our Company entitling that person to exercise more than 50% of the total voting power of all shares of our Company entitled to vote generally in elections of directors (except that such person will be deemed to have beneficial ownership of all securities that such person has the right to acquire, whether such right is currently exercisable or is exercisable only upon the occurrence of a subsequent condition); and • following the closing of any transaction referred to in the bullet point above, neither we nor the acquiring or surviving entity has a class of common securities (or ADRs representing such securities) listed on the NYSE, the NYSE American or NASDAQ or listed or quoted on an exchange or quotation system that is a successor to the NYSE, the NYSE American or NASDAQ. In addition, on and after November 17, 2022, we may redeem the Series I Preferred Stock, in whole or from time to time in part, at a cash redemption price equal to 100% of the $25.00 per share liquidation preference plus all accrued and unpaid dividends to the date fixed for redemption. The Series I Preferred Stock has no stated maturity and is not subject to any sinking fund or mandatory redemption provisions. Conversion Rights Upon the occurrence of a Change of Control, each holder of Series I Preferred Stock will have the right (unless, prior to the Change of Control conversion date, we have provided or provide notice of our election to redeem the Series I Preferred Stock) to convert some or all of the Series I Preferred Stock held by such holder on the Change of Control conversion date into a number of shares of our Common Stock per share of Series I Preferred Stock to be converted equal to the lesser of: • the quotient obtained by dividing (i) the sum of the $25.00 liquidation preference plus the amount of any accrued and unpaid dividends to, but not including, the Change of Control conversion date (unless the Change of Control conversion date is after a dividend record date for the Series I Preferred Stock and prior to the corresponding Series I Preferred Stock dividend payment date, in which case no additional amount for such accrued and unpaid dividend will be included in this sum) by (ii) the Common Stock Price (as defined below); and • 0.00806452 (the “Share Cap”), subject to certain adjustments; subject, in each case, to provisions for the receipt of alternative consideration. The “Common Stock Price” will be (i) the amount of cash consideration per share of Common Stock, if the consideration to be received in the Change of Control by the holders of our Common Stock is solely cash; or (ii) the average of the closing prices for our Common Stock on the NYSE for 10
Page 173
the ten consecutive trading days immediately preceding, but not including, the effective date of the Change of Control, if the consideration to be received in the Change of Control by the holders of our Common Stock is other than solely cash. If, prior to the Change of Control conversion date, we have provided or provide a redemption notice, whether pursuant to our special optional redemption right in connection with a Change of Control or our optional redemption right, holders of Series I Preferred Stock will not have any right to convert the Series I Preferred Stock in connection with the Change of Control conversion right and any shares of Series I Preferred Stock selected for redemption that have been tendered for conversion will be redeemed on the related date of redemption instead of converted on the Change of Control conversion date. Except as provided above in connection with a Change of Control, the Series I Preferred Stock is not convertible into or exchangeable for any other securities or property. Other Rights and Preferences Holders of shares of our Series I Preferred Stock have no preemptive rights to subscribe for any securities of our Company. During any period that we are not subject to the reporting requirements of the Exchange Act, and any Series I Preferred Stock is outstanding, holders of the Series I Preferred Stock will become entitled to certain information rights related thereto. Subject to the provisions of the charter regarding the restrictions on transfer of stock, we are not aware of any limitations on the rights to own our Series I Preferred Stock, including rights of non-resident or foreign stockholders to hold or exercise voting rights on our Series I Preferred Stock, imposed by foreign law or by our charter or bylaws. Listing The Series I Preferred Stock is traded on the NYSE under the trading symbol “AHT-PI.” Description of the Series J and Series K Redeemable Preferred Stock Our board of directors has classified and designated 28,000,000 shares of our capital stock as either Series J Redeemable Preferred Stock or Series K Redeemable Preferred Stock. The shares of Series J Redeemable Preferred Stock and Series K Redeemable Preferred Stock rank on a parity with our other classes of Preferred Stock listed on the NYSE, but are redeemable at the option of the holders or the Company in certain circumstances. The Series J Redeemable Preferred Stock and Series K Redeemable Preferred Stock are not listed on the NYSE. A further description of the terms of these classes of Redeemable Preferred Stock is contained in our Registration Statement on Form S-3 (File No. 333-28682) available at www.sec.gov. Description of the Series L and Series M Redeemable Preferred Stock Our board of directors has classified and designated 11,200,000 shares of our capital stock as Series L Redeemable Preferred Stock and 4,800,000 shares of our capital stock as Series M Redeemable Preferred Stock. The shares of Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock rank on a parity with our other classes of Preferred Stock listed on the NYSE, but are redeemable at the option of the holders or the Company in certain circumstances. The Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock are not listed on the NYSE. A further description of the terms of these classes of Redeemable Preferred Stock is contained in our Registration Statement on Form S-3 (File No. 333-286826) available at www.sec.gov. Restrictions on Ownership and Transfer In order for us to qualify as a real estate investment trust (“REIT”) under the Internal Revenue Code of 1986, as amended (the “Code”), not more than 50% of the value of the outstanding shares of our stock may be owned, actually or constructively, by five or fewer individuals (as defined in the Code to include certain entities) during the last half of a taxable year (other than the first year for which an election to be a REIT has been made by us). In addition, if we, or one or more owners (actually or constructively) of 10% or more of us, actually or constructively owns 10% or more of a tenant of ours (or a tenant of any partnership in which we are a partner), the rent received by us (either directly or through any such partnership) from such tenant will not be qualifying income for purposes of the REIT gross income tests of the Code. Our stock must also be beneficially owned by 100 or more persons during at least 335 days of a taxable year of 12 months or during a proportionate part of a shorter taxable year (other than the first year for which an election to be a REIT has been made by us). Our charter contains restrictions on the ownership and transfer of our capital stock that are intended to assist us in complying with these requirements and continuing to qualify as a REIT. The relevant sections of our charter provide that, subject to the exceptions described below, no person or persons acting as a group may own, or be deemed to own by virtue of the attribution 11
Page 174
provisions of the Code, more than (i) 9.8% of the lesser of the number or value of shares of our Common Stock outstanding or (ii) 9.8% of the lesser of the number or value of the issued and outstanding preferred or other shares of any class or series of our stock. We refer to this restriction as the “ownership limit.” The ownership attribution rules under the Code are complex and may cause stock owned actually or constructively by a group of related individuals and/or entities to be owned constructively by one individual or entity. As a result, the acquisition of less than 9.8% of our Common Stock (or the acquisition of an interest in an entity that owns, actually or constructively, our Common Stock) by an individual or entity, could, nevertheless cause that individual or entity, or another individual or entity, to own constructively in excess of 9.8% of our outstanding Common Stock and thereby subject the Common Stock to the ownership limit. Our board of directors may, in its sole discretion, waive the ownership limit with respect to one or more stockholders who would not be treated as “individuals” for purposes of the Code if it determines that such ownership will not cause any “individual’s” beneficial ownership of shares of our capital stock to jeopardize our status as a REIT (for example, by causing any tenant of ours to be considered a “related party tenant” for purposes of the REIT qualification rules). As a condition of our waiver, our board of directors may require an opinion of counsel or Internal Revenue Service ruling satisfactory to our board of directors, and/or representations or undertakings from the applicant with respect to preserving our REIT status. In connection with the waiver of the ownership limit or at any other time, our board of directors may decrease the ownership limit for all other persons and entities; provided, however, that the decreased ownership limit will not be effective for any person or entity whose percentage ownership in our capital stock is in excess of such decreased ownership limit until such time as such person or entity’s percentage of our capital stock equals or falls below the decreased ownership limit, but any further acquisition of our capital stock in excess of such percentage ownership of our capital stock will be in violation of the ownership limit. Additionally, the new ownership limit may not allow five or fewer “individuals” (as defined for purposes of the REIT ownership restrictions under the Code) to beneficially own more than 49.0% of the value of our outstanding capital stock. Our charter provisions further prohibit: • any person from actually or constructively owning shares of our capital stock that would result in us being “closely held” under Section 856(h) of the Code or otherwise cause us to fail to qualify as a REIT; and • any person from transferring shares of our capital stock if such transfer would result in shares of our stock being beneficially owned by fewer than 100 persons (determined without reference to any rules of attribution). Any person who acquires or attempts or intends to acquire beneficial or constructive ownership of shares of our Common Stock that will or may violate any of the foregoing restrictions on transferability and ownership will be required to give notice immediately to us and provide us with such other information as we may request in order to determine the effect of such transfer on our status as a REIT. The foregoing provisions on transferability and ownership will not apply if our board of directors determines that it is no longer in our best interests to qualify, or to continue to qualify, as a REIT. Pursuant to our charter, if any purported transfer of our capital stock or any other event would otherwise result in any person violating the ownership limits or the other restrictions in our charter, then any such purported transfer will be void and of no force or effect with respect to the purported transferee or owner (collectively referred to hereinafter as the “purported owner”) as to that number of shares in excess of the ownership limit (rounded up to the nearest whole share). The number of shares in excess of the ownership limit will be automatically transferred to, and held by, a trust for the exclusive benefit of one or more charitable organizations selected by us. The trustee of the trust will be designated by us and must be unaffiliated with us and with any purported owner. The automatic transfer will be effective as of the close of business on the business day prior to the date of the violative transfer or other event that results in a transfer to the trust. Any dividend or other distribution paid to the purported owner, prior to our discovery that the shares had been automatically transferred to a trust as described above, must be repaid to the trustee upon demand for distribution to the beneficiary of the trust and all dividends and other distributions paid by us with respect to such “excess” shares prior to the sale by the trustee of such shares shall be paid to the trustee for the beneficiary. If the transfer to the trust as described above is not automatically effective, for any reason, to prevent violation of the applicable ownership limit, then our charter provides that the transfer of the excess shares will be void. Subject to Maryland law, effective as of the date that such excess shares have been transferred to the trust, the trustee shall have the authority (at the trustee’s sole discretion and subject to applicable law) (i) to rescind as void any vote cast by a purported owner prior to our discovery that such shares have been transferred to the trust and (ii) to recast such vote in accordance with the desires of the 12
Page 175
trustee acting for the benefit of the beneficiary of the trust, provided that if we have already taken irreversible action, then the trustee shall not have the authority to rescind and recast such vote. Shares of our capital stock transferred to the trustee are deemed offered for sale to us, or our designee, at a price per share equal to the lesser of (i) the price paid by the purported owner for the shares (or, if the event which resulted in the transfer to the trust did not involve a purchase of such shares of our capital stock at market price, the market price on the day of the event which resulted in the transfer of such shares of our capital stock to the trust) and (ii) the market price on the date we, or our designee, accepts such offer. We have the right to accept such offer until the trustee has sold the shares of our capital stock held in the trust pursuant to the clauses discussed below. Upon a sale to us, the interest of the charitable beneficiary in the shares sold terminates and the trustee must distribute the net proceeds of the sale to the purported owner and any dividends or other distributions held by the trustee with respect to such capital stock will be paid to the charitable beneficiary. If we do not buy the shares, the trustee must, within 20 days of receiving notice from us of the transfer of shares to the trust, sell the shares to a person or entity designated by the trustee who could own the shares without violating the ownership limits. After that, the trustee must distribute to the purported owner an amount equal to the lesser of (i) the net price paid by the purported owner for the shares (or, if the event which resulted in the transfer to the trust did not involve a purchase of such shares at market price, the market price on the day of the event which resulted in the transfer of such shares of our capital stock to the trust) and (ii) the net sales proceeds received by the trust for the shares. Any proceeds in excess of the amount distributable to the purported owner will be distributed to the beneficiary. Our charter also provides that “Benefit Plan Investors” (as defined in our charter) may not hold, individually or in the aggregate, 25% or more of the value of any class or series of shares of our capital stock to the extent such class or series does not constitute “Publicly Offered Securities” (as defined in our charter). All persons who own, directly or by virtue of the attribution provisions of the Code, more than 5% (or such other percentage as provided in the regulations promulgated under the Code) of the lesser of the number or value of the shares of our outstanding capital stock must give written notice to us within 30 days after the end of each calendar year. In addition, each stockholder will, upon demand, be required to disclose to us in writing such information with respect to the direct, indirect and constructive ownership of shares of our stock as our board of directors deems reasonably necessary to comply with the provisions of the Code applicable to a REIT, to comply with the requirements or any taxing authority or governmental agency or to determine any such compliance. All certificates representing shares of our capital stock bear a legend referring to the restrictions described above. Certain Provisions of Maryland Law and Our Charter and Bylaws The Board of Directors Our bylaws provide that the number of directors of our Company may be established by our board of directors but may not be fewer than the minimum number permitted under the MGCL nor more than 15. Any vacancy will be filled, at any regular meeting or at any special meeting called for that purpose, by a majority of the remaining directors. Pursuant to our charter, each member of our board of directors will serve one year terms. See “Description of Common Stock” for further information regarding the election of directors. Business Combinations Maryland law prohibits “business combinations” between a corporation and an interested stockholder or an affiliate of an interested stockholder for five years after the most recent date on which the interested stockholder becomes an interested stockholder. These business combinations include a merger, consolidation, statutory share exchange, or, in circumstances specified in the statute, certain transfers of assets, certain stock issuances and transfers, liquidation plans and reclassifications involving interested stockholders and their affiliates as asset transfer or issuance or reclassification of equity securities. Maryland law defines an interested stockholder as: • any person who beneficially owns 10% or more of the voting power of our voting stock; or • an affiliate or associate of the corporation who, at any time within the two-year period prior to the date in question, was the beneficial owner of 10% or more of the voting power of the then-outstanding voting stock of the corporation. A person is not an interested stockholder if the board of directors approves in advance the transaction by which the person otherwise would have become an interested stockholder. However, in approving the transaction, the board of directors may 13
Page 176
provide that its approval is subject to compliance, at or after the time of approval, with any terms and conditions determined by the board of directors. After the five year prohibition, any business combination between a corporation and an interested stockholder generally must be recommended by the board of directors and approved by the affirmative vote of at least: • 80% of the votes entitled to be cast by holders of the then outstanding shares of Common Stock; and • two-thirds of the votes entitled to be cast by holders of the Common Stock other than shares held by the interested stockholder with whom or with whose affiliate the business combination is to be effected or shares held by an affiliate or associate of the interested stockholder. These super-majority vote requirements do not apply if certain fair price requirements set forth in the MGCL are satisfied. The statute permits various exemptions from its provisions, including business combinations that are approved by the board of directors before the time that the interested stockholder becomes an interested stockholder. Our charter includes a provision excluding the corporation from the business combinations provisions of the MGCL and, consequently, the five-year prohibition and the super-majority vote requirements will not apply to business combinations between us and any interested stockholder of ours unless we later amend our charter, with stockholder approval, to modify or eliminate this provision. Control Share Acquisitions The MGCL provides that “control shares” of a Maryland corporation acquired in a “control share acquisition” have no voting rights except to the extent approved at a special meeting by the affirmative vote of two-thirds of the votes entitled to be cast on the matter, excluding shares of stock in a corporation in respect of which any of the following persons is entitled to exercise or direct the exercise of the voting power of shares of stock of the corporation in the election of directors: (i) a person who makes or proposes to make a control share acquisition, (ii) an officer of the corporation or (iii) an employee of the corporation who is also a director of the corporation. “Control shares” are voting shares of stock which, if aggregated with all other such shares of stock previously acquired by the acquiror or in respect of which the acquiror is able to exercise or direct the exercise of voting power (except solely by virtue of a revocable proxy), would entitle the acquiror to exercise voting power in electing directors within one of the following ranges of voting power: (i) one-tenth or more but less than one-third, (ii) one-third or more but less than a majority, or (iii) a majority or more of all voting power. Control shares do not include shares the acquiring person is then entitled to vote as a result of having previously obtained stockholder approval. A “control share acquisition” means the acquisition, directly or indirectly, by any person of ownership, or the power to direct the exercise of voting power with respect to, issued and outstanding control shares, subject to certain exceptions. A person who has made or proposes to make a control share acquisition, upon satisfaction of certain conditions (including an undertaking to pay expenses), may compel our board of directors to call a special meeting of stockholders to be held within 50 days of demand to consider the voting rights of the shares. If no request for a meeting is made, the corporation may itself present the question at any stockholders meeting. If voting rights are not approved at the meeting or if the acquiring person does not deliver an acquiring person statement as required by the statute, then, subject to certain conditions and limitations, the corporation may redeem any or all of the control shares (except those for which voting rights have previously been approved) for fair value determined, without regard to the absence of voting rights for the control shares, as of the date of the last control share acquisition by the acquiror or of any meeting of stockholders at which the voting rights of such shares are considered and not approved. If voting rights for control shares are approved at a stockholders meeting and the acquiror becomes entitled to vote a majority of the shares entitled to vote, all other stockholders may exercise appraisal rights. The fair value of the shares as determined for purposes of such appraisal rights may not be less than the highest price per share paid by the acquiror in the control share acquisition. The control share acquisition statute does not apply to (i) shares acquired in a merger, consolidation or share exchange if the corporation is a party to the transaction or (ii) acquisitions approved or exempted by the charter or bylaws of the corporation at any time prior to the acquisition of the shares. Our charter contains a provision exempting from the control share acquisition statute any and all acquisitions by any person of our Common Stock and, consequently, the applicability of the control share acquisitions unless we later amend our charter, with stockholder approval, to modify or eliminate this provision. MGCL Title 3, Subtitle 8 14
Page 177
Subtitle 8 of Title 3 of the MGCL permits a Maryland corporation with a class of equity securities registered under the Exchange Act and at least three independent directors to elect to be subject, notwithstanding any contrary provision in the charter or bylaws, to any or all of the following five provisions: a classified board; a two-thirds stockholder vote requirement for removal of a director; a requirement that the number of directors be fixed only by vote of the directors; a requirement that a vacancy on the board of directors be filled only by the remaining directors and for the remainder of the full term of the class of directors in which the vacancy occurred; and a requirement that the holders of at least a majority of all votes entitled to be cast request a special meeting of stockholders. Through provisions in our charter and bylaws unrelated to Subtitle 8, we already require that the number of directors be fixed only by our board of directors and require,unless called by the Chairman of our board of directors, our president or chief executive officer or a majority of our board of directors, the written request of stockholders entitled to cast not less than a majority of all votes entitled to be cast at such meeting to call a special meeting. Our charter includes a provision prohibiting our Board from making any of the elections provided for under Subtitle 8. Consequently, we are unable to make any of the elections under Title 8 unless we later amend our charter, with stockholder approval, to modify or eliminate this provision. Amendment to Our Charter Our charter may be amended only if declared advisable by the board of directors and approved by the affirmative vote of the holders of at least two-thirds of all of the votes entitled to be cast on the matter. Dissolution of Our Company The dissolution of our Company must be declared advisable by the board of directors and approved by the affirmative vote of the holders of not less than two-thirds of all of the votes entitled to be cast on the matter. Advance Notice of Director Nominations and New Business Our bylaws provide that: • with respect to an annual meeting of stockholders, the only business to be considered and the only proposals to be acted upon will be those properly brought before the annual meeting: ◦ pursuant to our notice of the meeting; ◦ by, or at the direction of, a majority of our board of directors; or ◦ by a stockholder who is entitled to vote at the meeting and has complied with the advance notice procedures set forth in our bylaws; ◦ with respect to special meetings of stockholders, only the business specified in our Company’s notice of meeting may be brought before the meeting of stockholders unless otherwise provided by law; and • nominations of persons for election to our board of directors at any annual or special meeting of stockholders may be made only: ◦ by, or at the direction of, our board of directors; or ◦ by a stockholder who is entitled to vote at the meeting and has complied with the advance notice provisions set forth in our bylaws. Anti-Takeover Effect of Certain Provisions of Maryland Law and of Our Charter and Bylaws The advance notice provisions of our bylaws could delay, defer or prevent a transaction or a change of control of our Company that might involve a premium price for holders of our Common Stock or that stockholders otherwise believe may be in their best interest. Likewise, if our Company’s charter were to be amended to avail the corporation of the business combination provisions of the MGCL to remove or modify the provision in the charter opting out of the control share acquisition provisions 15
Page 178
of the MGCL, or to permit certain elections to be made under Title 3, Subtitle 8 of the MGCL, these provisions of the MGCL could have similar anti-takeover effects. Indemnification and Limitation of Directors’ and Officers’ Liability Our charter and the partnership agreement provide for indemnification of our officers and directors against liabilities to the fullest extent permitted by the MGCL, as amended from time to time. The MGCL permits a corporation to indemnify a director or officer who has been successful, on the merits or otherwise, in the defense of any proceeding to which he or she is made a party by reason of his or her service in that capacity. The MGCL permits a corporation to indemnify its present and former directors and officers, among others, against judgments, penalties, fines, settlements and reasonable expenses actually incurred by them in connection with any proceeding to which they may be made a party by reason of their service in those or other capacities unless it is established that: • an act or omission of the director or officer was material to the matter giving rise to the proceeding and: ◦ was committed in bad faith; or ◦ was the result of active and deliberate dishonesty; • the director or officer actually received an improper personal benefit in money, property or services; or • in the case of any criminal proceeding, the director or officer had reasonable cause to believe that the act or omission was unlawful. However, under the MGCL, a Maryland corporation may not indemnify for an adverse judgment in a suit by or in the right of the corporation (other than for expenses incurred in a successful defense of such an action) or for a judgment of liability on the basis that personal benefit was improperly received. In addition, the MGCL permits a corporation to advance reasonable expenses to a director or officer upon the corporation’s receipt of: • a written affirmation by the director or officer of his good faith belief that he has met the standard of conduct necessary for indemnification by the corporation; and • a written undertaking by the director or on the director’s behalf to repay the amount paid or reimbursed by the corporation if it is ultimately determined that the director did not meet the standard of conduct. The MGCL permits a Maryland corporation to include in its charter a provision limiting the liability of its directors and officers to the corporation and its stockholders for money damages except for liability resulting from actual receipt of an improper benefit or profit in money, property or services or active and deliberate dishonesty established by a final judgment as being material to the cause of action. Our charter contains such a provision which eliminates such liability to the maximum extent permitted by Maryland law. Our charter and bylaws obligate us, to the fullest extent permitted by Maryland law in effect from time to time, to indemnify and, without requiring a preliminary determination of the ultimate entitlement to indemnification, pay or reimburse reasonable expenses in advance of final disposition of a proceeding to: • any present or former director or officer who is made a party to the proceeding by reason of his or her service in that capacity; or • any individual who, while a director or officer of our Company and at our request, serves or has served another corporation, real estate investment trust, partnership, joint venture, trust, employee benefit plan or any other enterprise as a director, officer, partner or trustee and who is made a party to the proceeding by reason of his or her service in that capacity. Our bylaws also obligate us to indemnify and advance expenses to any person who served a predecessor of ours in any of the capacities described in second and third bullet points above and to any employee or agent of our Company or a predecessor of our Company. The partnership agreement of our operating partnership provides that we, as general partner, and our officers and directors are indemnified to the fullest extent permitted by law. See the section titled “Partnership Agreement-Exculpation and Indemnification of the General Partner” in the Annual Report on Form 10-K of which this Exhibit 4.8 is a part. 16
Page 179
Insofar as the foregoing provisions permit indemnification of directors, officers or persons controlling us for liability arising under the Securities Act of 1933, as amended (the “Securities Act”), we have been informed that in the opinion of the Securities and Exchange Commission, this indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. Description of Preferred Stock Purchase Rights On December 15, 2025, our board of directors declared a dividend of one preferred share purchase right (a “Right”) for each outstanding share of Common Stock, each Right initially representing the right to purchase from us one one-thousandth of a share of Series N Junior Participating Preferred Stock, par value $0.01 per share (the “Series N Preferred Stock”), at a price of $20.00 per one one-thousandth of a share of Series N Preferred Stock (the “Purchase Price”), subject to adjustment as provided in the Rights Agreement. The dividend was paid to holders of Common Stock of record as of 5:00 p.m. New York City time on December 26, 2025 (the “Record Date”). The Rights Agreement is designed to prevent the Company from facing a substantial limitation on its ability to use its Tax Benefits (as such term is defined in the Rights Agreement) to offset potential future income taxes for federal income tax purposes and realize other efficiencies. Effectiveness The Rights Agreement became effective at 5:00 p.m. New York City time on December 15, 2025 (the “Effective Date”). Upon and following the Effective Date, Rights will be issued in respect of all outstanding shares of Common Stock on the Record Date, and for all shares of Common Stock issued after the Record Date and, subject to the terms described in the Rights Agreement, prior to the earliest of the Distribution Date (as defined below), the redemption of the Rights or the expiration of the Rights as provided by the Rights Agreement. Distribution and Transfer of Rights; Distribution Date; Rights Certificates Subject to certain exceptions specified in the Rights Agreement, the Rights will separate from the Common Stock and become exercisable at 5:00 p.m. New York City time on the next business day following the earlier of (i) the Flip-In Date (as defined below) or (ii) 10 business days after the date (prior to such time as any person or group of affiliated persons becomes an Acquiring Person), if any, as may be determined by action of our board of directors, in its sole discretion, following the commencement of, or public announcement of an intention to commence, a tender or exchange offer the consummation of which would result in any person or group of affiliated or associated persons becoming an Acquiring Person (the earlier of such dates being called the “Distribution Date”). A person or group of affiliated or associated persons becomes an “Acquiring Person” upon acquiring Beneficial Ownership of 4.99% or more of any class of Company Securities then outstanding, except in certain situations (including a person or group of affiliated or associated persons that currently has Beneficial Ownership of any class of Company Securities then outstanding in excess of such threshold unless and until such person or group becomes the Beneficial Owner of a percentage of any class of Company Securities outstanding that exceeds by 0.5% or more the percentage of any class of Company Securities outstanding that such person or group owned as of the first public announcement of the adoption of the Rights Agreement). For purposes of the Rights Agreement, “Company Securities” means the Common Stock and any other interest that our board of directors determines would be treated as “stock” of the Company for purposes of Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”) (including Treasury Regulation Sections 1.382-2(a)(3) and 1.382-2T(f)(18)). The Rights Agreement provides that, until the Distribution Date (or earlier redemption or expiration of the Rights), the Rights will be transferred with and only with the Common Stock. Until the Distribution Date (or earlier redemption or expiration of the Rights), new Common Stock certificates issued after the Record Date upon transfer or new issuances of Common Stock will contain a legend incorporating the Rights Agreement by reference (and notice of such legend will be furnished to holders of book entry shares). Until the Distribution Date (or earlier redemption or expiration of the Rights), the surrender for transfer of any certificates for shares of Common Stock (or of any book entry shares of Common Stock) outstanding as of the Record Date, even without such legend (or notice of such legend) or a copy of the Summary of Rights (as such term is defined in the Rights Agreement), will also constitute the transfer of the Rights associated with the shares of Common Stock represented by such certificate (or book entry). As soon as practicable following the Distribution Date, separate certificates evidencing the Rights (“Right Certificates”) will be mailed to holders of record of the Common Stock as of the close of business on the Distribution Date and such separate Right Certificates alone will evidence the Rights. The Rights are not exercisable until the Distribution Date. Pursuant to the terms of the Rights Agreement, the Rights will expire on the earliest of (i) 5:00 p.m. New York City time on December 14, 2026, (ii) the effective date of the repeal of Section 382 of the Code or any successor statute if our board of directors determines in its sole discretion that the Rights Agreement is no 17
Page 180
longer necessary or desirable for the preservation of Tax Benefits, or (iii) the first day of a taxable year of the Company to which our board of directors determines in its sole discretion that no Tax Benefits may be carried forward, unless the Rights are earlier redeemed or exchanged by the Company, in each case as described below, or upon the occurrence of certain transactions. Series N Preferred Stock Purchasable Upon Exercise of Rights Because of the nature of the Series N Preferred Stock’s dividend, liquidation and voting rights, the value of the one one-thousandth interest in a share of Series N Preferred Stock purchasable upon exercise of each Right should approximate the value of one share of Common Stock. Exempt Persons and Transactions The Rights Agreement includes procedures whereby our board of directors will consider requests to exempt (a) any person or group (an “Exempt Person”) which would otherwise be an Acquiring Person, or (b) any transaction (an “Exempt Transaction”) resulting in the Beneficial Ownership of Company Securities, prior to the consummation of such transaction, from the Acquiring Person trigger, in each case as determined by our board of directors in its sole discretion, provided that it will only grant such an exemption if it determines in its sole discretion that such ownership would not reasonably be expected to jeopardize or endanger the availability of the Tax Benefits to the Company or if it otherwise determines that the exemption is in the best interests of the Company; provided further that, (A) in the case of an Exempt Person, if our board of directors later makes a contrary determination with respect to the effect of such person or group’s Beneficial Ownership with respect to the availability to the Company of its Tax Benefits, such person or group will cease to be an Exempt Person and (B) in the case of an Exempt Person or Exempt Transaction, our board of directors in its sole discretion may require the applicable person or group to make certain representations or undertakings, the violation or attempted violation of which will be subject to such consequences as our board of directors may determine in its sole discretion, including that such person or group will become an Acquiring Person. Flip-In Trigger On the first date of public announcement by the Company that any person or group of affiliated or associated persons has become an Acquiring Person pursuant to the Rights Agreement, which announcement makes express reference to such status as an Acquiring Person pursuant to the Rights Agreement (the “Stock Acquisition Date”), or on such later date as our board of directors may fix by resolution adopted prior to such Stock Acquisition Date (such date, a “Flip-In Date”, and the first Flip-In Date to occur, a “Flip-In Event”), each holder of a Right (other than Rights beneficially owned by the Acquiring Person, affiliates and associates of the Acquiring Person and certain transferees thereof which will thereupon become null and void) will thereafter have the right to receive upon exercise of a Right that number of shares of Common Stock or, at the Company’s option, shares of Series N Preferred Stock (or fraction thereof, having an equivalent value to the substituted Common Stock) having a market value of two times the exercise price of the Right; provided that if such exercise of Rights would result in a person becoming the Beneficial Owner of more than 4.99% of any class of Company Securities then outstanding, our board of directors may elect (in its sole discretion) to distribute cash to such person or a note or other form of indebtedness of equivalent value. Flip-Over Trigger If, after a Flip-In Event, the Company is acquired in a merger or other business combination transaction or 50% or more of its consolidated assets or earning power are sold, proper provisions will be made so that each holder of a Right (other than Rights beneficially owned by an Acquiring Person, affiliates and associates of the Acquiring Person and certain transferees thereof which will have become null and void) will thereafter have the right to receive upon the exercise of a Right that number of shares of common stock of the person with whom the Company has engaged in the foregoing transaction (or its parent) that at the time of such transaction have a market value of two times the exercise price of the Right. Exchange Provision At any time after a Flip-In Event and prior to the earlier of one of the events described in the previous paragraph or the acquisition by such Acquiring Person of 50% or more of the outstanding shares of Common Stock, our board of directors may exchange the Rights (other than Rights owned by such Acquiring Person, affiliates and associates of the Acquiring Person and certain transferees thereof which will have become null and void), in whole or in part, for shares of Common Stock or Series N Preferred Stock (or a series of the Company’s preferred stock having equivalent rights, preferences, privileges and restrictions), at an exchange ratio of one share of Common Stock, or a fractional share of Series N Preferred Stock (or other preferred stock) equivalent in value thereto, per Right; provided that if such exchange of Rights would result in a person becoming the 18
Page 181
Beneficial Owner of more than 4.99% of any class of Company Securities then outstanding, our board of directors may elect (in its sole discretion) to distribute cash to such person or a note or other form of indebtedness of equivalent value. Redemption of the Rights At any time prior to a Flip-In Event, our board of directors may redeem the Rights in whole, but not in part, at a price of $0.0001 per Right (the “Redemption Price”) payable, at the option of the Company, in cash, shares of Common Stock or such other form of consideration as our board of directors determines in its sole discretion. The redemption of the Rights may be made effective at such time, on such basis and with such conditions as our board of directors in its sole discretion may establish. Immediately upon any redemption of the Rights, the right to exercise the Rights will terminate and the only right of the holders of Rights will be to receive the Redemption Price. Amendment of Terms of Rights Agreement and Rights For so long as the Rights are then redeemable, the Company may, except with respect to the Redemption Price, amend the Rights Agreement in any manner without the approval of any holders of the Rights. After the Rights are no longer redeemable, the Company may, except with respect to the Redemption Price, amend the Rights Agreement in any manner that does not adversely affect the interests of holders of the Rights (other than an Acquiring Person, affiliates and associates of the Acquiring Person and certain transferees thereof). Voting Rights; Other Stockholder Rights Until a Right is exercised or exchanged, the holder thereof, as such, will have no rights as a stockholder of the Company, including, without limitation, the right to vote or to receive dividends. Anti-Dilution Provisions The Purchase Price payable, and the number of shares of Series N Preferred Stock or other securities or property issuable, upon exercise of the Rights is subject to adjustment from time to time to prevent dilution (i) in the event of a stock dividend on, or a subdivision, combination or reclassification of, the Series N Preferred Stock, (ii) upon the grant to holders of the Series N Preferred Stock of certain rights or warrants to subscribe for or purchase Series N Preferred Stock at a price, or securities convertible into Series N Preferred Stock with a conversion price, less than the then-current market price of the Series N Preferred Stock or (iii) upon the distribution to holders of the Series N Preferred Stock of evidences of indebtedness or assets (other than regular periodic cash dividends or dividends payable in Series N Preferred Stock) or of subscription rights or warrants (other than those referred to above). 19
Page 182
EXHIBIT 21.1 SUBSIDIARIES LISTING AS OF DECEMBER 31, 2025 All the subsidiaries listed below are incorporated in Delaware except that Ashford Hospitality Trust, Inc. is incorporated in Maryland and815 Commerce Construction Manager LLC is organized in Texas. Ashford Hospitality Trust, Inc. 815 Commerce Construction Manager LLC 815 Commerce LLC 815 Commerce Managing Member LLC 815 Commerce Master Tenant LLC AH Tenant Corporation AHT SMA GP, LLC AHT SMA, LP Annapolis Hotel GP LLC Annapolis Maryland Hotel Limited Partnership Ashford A-3 Mezz LLC Ashford Alexandria GP LLC Ashford Alexandria Holding LLC Ashford Alexandria LP Ashford Alpharetta Limited Partnership Ashford Anchorage GP LLC Ashford Anchorage LP Ashford Ashton GP LLC Ashford Ashton LP Ashford Atlanta Peachtree GP LLC Ashford Atlanta Peachtree LP Ashford Atlantic Beach GP LLC Ashford Atlantic Beach LP Ashford Austin GP LLC Ashford Austin LP Ashford Basking Ridge GP LLC Ashford Basking Ridge LP Ashford Beverly Hills GP LLC Ashford Bloomington GP LLC Ashford Bloomington LP Ashford Bridgewater GP LLC Ashford Bridgewater Hotel Partnership, LP Ashford Buford I LP Ashford Buford II LP Ashford BWI Airport GP LLC Ashford BWI Airport LP Ashford C-1 LLC Ashford C-2 LLC Ashford Charlotte Limited Partnership Ashford CM GP LLC Ashford CM Partners LP Ashford Coral Gables GP LLC Ashford Coral Gables LP
Page 183
Ashford Credit Holding LLC Ashford Crystal City GP LLC Ashford Crystal City Limited Partnership Ashford Crystal City Partners LP Ashford Crystal Gateway GP LLC Ashford Crystal Gateway LP Ashford D-3 Mezz LLC Ashford Dallas GP LLC Ashford Dallas LP Ashford Downtown Atlanta GP LLC Ashford Downtown Atlanta LP Ashford Dulles GP LLC Ashford Dulles LP Ashford Durham I LLC Ashford Eight General Partner LLC Ashford Evansville I GP LLC Ashford Evansville I LP Ashford Evansville III GP LLC Ashford Evansville III LP Ashford Falls Church GP LLC Ashford Falls Church Limited Partnership Ashford Five Junior Holder LLC Ashford Five Junior Mezz LLC Ashford Five Senior Mezz LLC Ashford Flagstaff GP LLC Ashford Flagstaff LP Ashford Fort Tower I GP LLC Ashford Fremont GP LLC Ashford Fremont LP Ashford G-3 Mezz LLC Ashford Gateway TRS Corporation Ashford Hawthorne GP LLC Ashford Hawthorne LP Ashford Hospitality Finance General Partner LLC Ashford Hospitality Finance LP Ashford Hospitality Limited Partnership Ashford IHC LLC Ashford IHC Partners, LP Ashford Irvine Spectrum Foothill Ranch Limited Partnership Ashford Jacksonville I GP LLC Ashford Jacksonville I LP Ashford Jacksonville IV GP LLC Ashford Jacksonville IV LP Ashford Junior A LLC Ashford Junior B LLC Ashford Junior C LLC Ashford Junior D LLC Ashford Junior E LLC Ashford Junior F LLC 2
Page 184
Ashford Junior M1 LLC Ashford Junior M2 LLC Ashford Kennesaw I LP Ashford Kennesaw II LP Ashford Lakeway GP LLC Ashford Lakeway LP Ashford Las Vegas GP LLC Ashford Las Vegas LP Ashford Lawrenceville LP Ashford Le Pavillon GP LLC Ashford Le Pavillon LP Ashford Le Pavillon Senior Mezz LLC Ashford Lee Vista GP LLC Ashford Lee Vista Partners LP Ashford LV Hughes Center GP LLC Ashford LV Hughes Center LP Ashford M Investor LLC Ashford Manhattan Beach GP LLC Ashford Manhattan Beach LP Ashford Market Center GP LLC Ashford Market Center LP Ashford Memphis GP LLC Ashford Memphis LP Ashford Minneapolis Airport GP LLC Ashford Minneapolis Airport LP Ashford Mira Mesa GP LLC Ashford Mira Mesa San Diego Limited Partnership Ashford MV San Diego GP LLC Ashford MV San Diego LP Ashford Newark GP LLC Ashford Newark LP Ashford Oakland GP LLC Ashford Oakland LP Ashford Omaha LLC Ashford Omaha Mezz LLC Ashford OP General Partner LLC Ashford OP Limited Partner LLC Ashford Orlando Sea World Limited Partnership Ashford Overland Park Limited Partnership Ashford PH GP LLC Ashford PH Partners LP Ashford Philly GP LLC Ashford Philly LP Ashford Phoenix Airport GP LLC Ashford Phoenix Airport LP Ashford Plano-C GP LLC Ashford Plano-C LP Ashford Plano-R GP LLC Ashford Plano-R LP 3
Page 185
Ashford Plymouth Meeting GP LLC Ashford Plymouth Meeting LP Ashford Pool C1 Junior Holder LLC Ashford Pool C1 Junior Mezz LLC Ashford Pool C1 Senior Mezz LLC Ashford Pool C2 GP LLC Ashford Pool C2 Junior Holder LLC Ashford Pool C2 Junior Mezz LLC Ashford Pool C2 Senior Mezz LLC Ashford Pool C3 GP LLC Ashford Pool C3 Junior Holder LLC Ashford Pool C3 Junior Mezz LLC Ashford Pool C3 Senior Mezz LLC Ashford Posada GP LLC Ashford Posada Holding LLC Ashford Posada LP Ashford Raleigh Limited Partnership Ashford RB Junior Mezz LLC Ashford RB Senior Mezz LLC Ashford REIT LLC Ashford Salt Lake Limited Partnership Ashford San Jose GP LLC Ashford San Jose LP Ashford Santa Clara GP LLC Ashford Santa Clara Partners LP Ashford Santa Fe GP LLC Ashford Santa Fe LP Ashford Scotts Valley GP LLC Ashford Scotts Valley LP Ashford Scottsdale GP LLC Ashford Scottsdale LP Ashford Senior A LLC Ashford Senior B LLC Ashford Senior C LLC Ashford Senior D LLC Ashford Senior E LLC Ashford Senior F LLC Ashford Senior General Partner II LLC Ashford Senior General Partner IV LLC Ashford Senior M1 LLC Ashford Senior M2 LLC Ashford Six General Partner LLC Ashford Ten Junior Mezz LLC Ashford Ten Senior Mezz LLC Ashford Tipton Lakes GP LLC Ashford Tipton Lakes LP Ashford TRS Alexandria Holding LLC Ashford TRS Alexandria LLC Ashford TRS Anchorage LLC 4
Page 186
Ashford TRS Annex LLC Ashford TRS Ashton Holder LLC Ashford TRS Ashton LLC Ashford TRS Atlanta Peachtree LLC Ashford TRS Atlantic Beach LLC Ashford TRS Austin LLC Ashford TRS Basking Ridge LLC Ashford TRS Beverly Hills LLC Ashford TRS Bloomington LLC Ashford TRS Bridgewater LLC Ashford TRS BWI Airport LLC Ashford TRS C-1 LLC Ashford TRS C-2 LLC Ashford TRS CM LLC Ashford TRS Coral Gables LLC Ashford TRS Corporation Ashford TRS Crystal City LLC Ashford TRS Dallas LLC Ashford TRS Downtown Atlanta LLC Ashford TRS Dulles LLC Ashford TRS Durham I LLC Ashford TRS Eight LLC Ashford TRS Evansville I LLC Ashford TRS Evansville III LLC Ashford TRS Five Junior Holder I LLC Ashford TRS Five Junior Holder II LLC Ashford TRS Five Junior Holder III LLC Ashford TRS Five Junior Holder IV LLC Ashford TRS Five Junior Holder V LLC Ashford TRS Five Junior Mezz I LLC Ashford TRS Five Junior Mezz II LLC Ashford TRS Five Junior Mezz III LLC Ashford TRS Five Junior Mezz IV LLC Ashford TRS Five Junior Mezz V LLC Ashford TRS Five LLC Ashford TRS Five Senior Mezz I LLC Ashford TRS Five Senior Mezz II LLC Ashford TRS Five Senior Mezz III LLC Ashford TRS Five Senior Mezz IV LLC Ashford TRS Five Senior Mezz V LLC Ashford TRS Flagstaff LLC Ashford TRS Fort Tower I LLC Ashford TRS Fremont LLC Ashford TRS Hawthorne LLC Ashford TRS Investment Management GP LLC Ashford TRS Investment Management LP Ashford TRS Jacksonville I LLC Ashford TRS Jacksonville IV LLC Ashford TRS Junior A LLC 5
Page 187
Ashford TRS Junior B LLC Ashford TRS Junior C1 LLC Ashford TRS Junior C2 LLC Ashford TRS Junior D1 LLC Ashford TRS Junior D2 LLC Ashford TRS Junior E LLC Ashford TRS Junior F LLC Ashford TRS Junior M1 LLC Ashford TRS Junior M2 LLC Ashford TRS Lakeway LLC Ashford TRS Las Vegas LLC Ashford TRS Le Pavillon LLC Ashford TRS Le Pavillon Senior Mezz LLC Ashford TRS Lee Vista LLC Ashford TRS Lessee II LLC Ashford TRS Lessee IV LLC Ashford TRS LV Hughes Center LLC Ashford TRS M Investor LLC Ashford TRS Manhattan Beach LLC Ashford TRS Marietta LLC Ashford TRS Market Center LLC Ashford TRS Memphis LLC Ashford TRS Minneapolis Airport LLC Ashford TRS MV San Diego LLC Ashford TRS Newark LLC Ashford TRS Oakland LLC Ashford TRS PH LLC Ashford TRS Philly LLC Ashford TRS Phoenix Airport LLC Ashford TRS Plano-C LLC Ashford TRS Plano-R LLC Ashford TRS Plymouth Meeting LLC Ashford TRS Pool C1 Junior Holder LLC Ashford TRS Pool C1 Junior Mezz LLC Ashford TRS Pool C1 Senior Mezz LLC Ashford TRS Pool C2 Junior Holder LLC Ashford TRS Pool C2 Junior Mezz LLC Ashford TRS Pool C2 LLC Ashford TRS Pool C2 Senior Mezz LLC Ashford TRS Pool C3 Junior Holder LLC Ashford TRS Pool C3 Junior Mezz LLC Ashford TRS Pool C3 LLC Ashford TRS Pool C3 Senior Mezz LLC Ashford TRS Posada Holding LLC Ashford TRS Posada LLC Ashford TRS RB Junior Mezz LLC Ashford TRS RB Senior Mezz LLC Ashford TRS San Jose LLC Ashford TRS Santa Clara LLC 6
Page 188
Ashford TRS Santa Fe LLC Ashford TRS Scotts Valley LLC Ashford TRS Scottsdale LLC Ashford TRS Senior A LLC Ashford TRS Senior B LLC Ashford TRS Senior C1 LLC Ashford TRS Senior C2 LLC Ashford TRS Senior D1 LLC Ashford TRS Senior D2 LLC Ashford TRS Senior E LLC Ashford TRS Senior F LLC Ashford TRS Senior M1 LLC Ashford TRS Senior M2 LLC Ashford TRS Six LLC Ashford TRS Ten Junior Mezz LLC Ashford TRS Ten Senior Mezz LLC Ashford TRS Tipton Lakes LLC Ashford TRS VII Corporation Ashford TRS Walnut Creek LLC Ashford Walnut Creek GP LLC Ashford Walnut Creek LP Austin Embassy Beverage, Inc. Crystal City Tenant Corp. CY Manchester Hotel Partners, LP CY Manchester Tenant Corporation CY-CIH Manchester Parent, LLC HH Atlanta LLC HH Austin Hotel Associates, L.P. HH Baltimore LLC HH Chicago LLC HH Churchill Hotel Associates, L.P. HH Denver LLC HH DFW Hotel Associates, L.P. HH FP Portfolio LLC HH Gaithersburg LLC HH LC Portfolio LLC HH MelPlohg Hotel Associates, L.P. HH Mezz Borrower A-2 LLC HH Mezz Borrower A-4 LLC HH Mezz Borrower D-1 LLC HH Mezz Borrower D-2 LLC HH Mezz Borrower D-4 LLC HH Mezz Borrower G-2 LLC HH Mezz Borrower G-4 LLC HH Palm Springs LLC HH Princeton LLC HH Savannah LLC HH Swap A LLC HH Swap C LLC 7
Page 189
HH Swap C-1 LLC HH Swap D LLC HH Swap F LLC HH Swap F-1 LLC HH Swap G LLC HH Tampa Westshore LLC HH Texas Hotel Associates, L.P. HHC Texas GP LLC HHC TRS Atlanta LLC HHC TRS Austin LLC HHC TRS Baltimore LLC HHC TRS Chicago LLC HHC TRS FP Portfolio LLC HHC TRS Highland LLC HHC TRS LC Portfolio LLC HHC TRS MelPlohg LLC HHC TRS Portsmouth LLC HHC TRS Princeton LLC HHC TRS Savannah LLC HHC TRS Tampa LLC Key West Florida Hotel Limited Partnership Key West Hotel GP LLC Lee Vista Tenant Corp. Marietta Leasehold GP LLC Marietta Leasehold L.P. Minnetonka Hotel GP LLC Minnetonka Minnesota Hotel Limited Partnership New Beverly Hills Hotel Limited Partnership New Clear Lake GP LLC New Clear Lake Hotel Limited Partnership New Fort Tower I Hotel Limited Partnership New Fort Tower II Hotel Limited Partnership New Forth Tower II GP LLC New Houston GP LLC New Houston Hotel Limited Partnership New Indianapolis Downtown GP LLC New Indianapolis Downtown Hotel Limited Partnership Non-REIT GP LLC Palm Beach Florida Hotel and Office Building Limited Partnership Palm Beach GP LLC PIM Boston Back Bay LLC PIM Highland Holding LLC PIM Nashville LLC PIM TRS Boston Back Bay LLC PIM TRS Nashville LLC RFS SPE 2000 LLC RI Manchester Holding LLC RI Manchester Hotel Partners, LP RI Manchester Tenant Corporation 8
Page 190
RI TRS Manchester Holding LLC RI TRS Manchester LLC RI-CIH Manchester Parent, LLC Santa Clara Tenant Corp. St. Petersburg Florida Hotel Limited Partnership St. Petersburg Florida Land Limited Partnership St. Petersburg GP LLC St. Petersburg Land GP LLC Stirling Buford I GP LLC Stirling Buford I Holding LLC Stirling Buford II GP LLC Stirling Buford II Holding LLC Stirling Jacksonville IV Holding LLC Stirling OP General Partner LLC Stirling OP Limited Partner LLC Stirling REIT Holdings LLC Stirling REIT OP, LP Stirling TRS Buford I Holding LLC Stirling TRS Buford I LLC Stirling TRS Buford II Holding LLC Stirling TRS Buford II LLC Stirling TRS Corporation Stirling TRS Jacksonville IV Holding LLC 9
Page 191
EXHIBIT 21.2 SPECIAL PURPOSE ENTITIES LIST AS OF DECEMBER 31, 2025 Annapolis Maryland Hotel Limited Partnership Ashford Alpharetta Limited Partnership Ashford Anchorage LP Ashford Austin LP Ashford Basking Ridge LP Ashford Bloomington LP Ashford CM Partners LP Ashford Coral Gables LP Ashford Crystal City Partners LP Ashford Crystal City Limited Partnership Ashford Crystal Gateway LP Ashford Dallas LP Ashford Dulles LP Ashford Evansville I LP Ashford Falls Church Limited Partnership Ashford Irvine Spectrum Foothill Ranch Limited Partnership Ashford Gateway TRS Corporation Ashford Hawthorne LP Ashford Jacksonville I LP Ashford Las Vegas LP Ashford Lee Vista Partners LP Ashford LV Hughes Center LP Ashford Manhattan Beach LP Ashford Market Center LP Ashford Minneapolis Airport LP Ashford MV San Diego LP Ashford Newark LP Ashford Oakland LP Ashford Orlando Sea World Limited Partnership Ashford Overland Park Limited Partnership Ashford Philly LP Ashford Phoenix Airport LP Ashford PH Partners LP Ashford Plymouth Meeting LP Ashford San Jose LP Ashford Santa Clara Partners LP Ashford Santa Fe LP Ashford Scottsdale LP Key West Florida Hotel Limited Partnership Minnetonka Minnesota Hotel Limited Partnership New Beverly Hills Hotel Limited Partnership New Fort Tower I Hotel Limited Partnership
Page 192
New Houston Hotel Limited Partnership New Indianapolis Downtown Hotel Limited Partnership Palm Beach Florida Hotel and Office Building Limited Partnership St. Petersburg Florida Hotel Limited Partnership Ashford TRS CM LLC Ashford TRS Crystal City LLC Ashford TRS Lee Vista LLC Ashford TRS Lessee II LLC Ashford TRS Lessee IV LLC Ashford TRS PH LLC Ashford TRS Santa Clara LLC Annapolis Hotel GP LLC Ashford Anchorage GP LLC Ashford CM GP LLC Ashford Crystal City GP LLC Ashford Crystal Gateway GP LLC Ashford Lee Vista GP LLC Ashford Minneapolis Airport GP LLC Ashford MV San Diego GP LLC Ashford Philly GP LLC Ashford PH GP LLC Ashford Santa Clara GP LLC Ashford Senior General Partner II LLC Ashford Senior General Partner IV LLC Key West Hotel GP LLC Minnetonka Hotel GP LLC New Houston GP LLC New Indianapolis Downtown Hotel GP LLC Palm Beach GP LLC St. Petersburg GP LLC Ashford Five Junior Mezz LLC Ashford Five Senior Mezz LLC Ashford Five Junior Holder LLC Ashford TRS Five Junior Holder I LLC Ashford TRS Five Junior Holder II LLC Ashford TRS Five Junior Holder III LLC Ashford TRS Five Junior Holder IV LLC Ashford TRS Five Junior Holder V LLC Ashford TRS Five Junior Mezz I LLC Ashford TRS Five Junior Mezz II LLC Ashford TRS Five Junior Mezz III LLC Ashford TRS Five Junior Mezz IV LL Ashford TRS Five Junior Mezz V LLC Ashford TRS Five Senior Mezz I LLC Ashford TRS Five Senior Mezz II LLC 2
Page 193
Ashford TRS Five Senior Mezz III LLC Ashford TRS Five Senior Mezz IV LLC Ashford TRS Five Senior Mezz V LLC Ashford TRS Five LLC Santa Clara Tenant Corp. Lee Vista Tenant Corp. Crystal City Tenant Corp. AH Tenant Corp. Ashford Fremont LP Ashford Fremont GP LLC Ashford TRS Fremont LLC Ashford TRS Pool 1 LLC Ashford Six General Partner LLC Ashford TRS Six LLC Ashford Lakeway LP Ashford Lakeway GP LLC Ashford TRS Lakeway LLC Ashford Memphis GP LLC Ashford Memphis LP Ashford TRS Memphis LLC HH Mezz Borrower A-4 LLC Ashford A-3 Mezz LLC HH Mezz Borrower A-2 LLC HH Swap A LLC HH Mezz Borrower G-4 LLC Ashford G-3 Mezz LLC HH Mezz Borrower G-2 LLC HH Swap G LLC HH Mezz Borrower D-4 LLC Ashford D-3 Mezz LLC HH Mezz Borrower D-2 LLC HH Mezz Borrower D-1 LLC HH Swap D LLC Non-REIT GP LLC HHC Texas GP LLC HH FP Portfolio LLC HH LC Portfolio LLC HH Texas Hotel Associates, L.P. HH Melrose Hotel Associates, L.P. HH Churchill Hotel Associates, L.P. HH Austin Hotel Associates, L.P. HH DFW Hotel Associates, L.P. HH Savannah LLC HH Atlanta LLC HH Gaithersburg LLC 3
Page 194
HH Baltimore LLC HH Chicago LLC HH Palm Springs LLC HH Tampa Westshore LLC HH Princeton LLC PIM Nashville LLC PIM TRS Nashville LLC HHC TRS Princeton LLC HHC TRS Savannah LLC HHC TRS Atlanta LLC HHC TRS FP Portfolio LLC HHC TRS LC Portfolio LLC HHC TRS Baltimore LLC HHC TRS Melrose LLC HHC TRS Highland LLC HHC TRS Chicago LLC HHC TRS Austin LLC HHC TRS Portsmouth LLC HHC TRS Tampa LLC Ashford Atlanta Peachtree LP Ashford Atlanta Peachtree GP LLC Ashford TRS Atlanta Peachtree LLC Ashford Ten Senior Mezz LLC Ashford Ten Junior Mezz LLC Ashford TRS Ten Senior Mezz LLC Ashford TRS Ten Junior Mezz LLC Ashford Bloomington GP LLC Ashford Evansville I GP LLC Ashford Jacksonville I GP LLC Ashford TRS Bloomington LLC Ashford TRS Evansville I LLC Ashford TRS Jacksonville I LLC Ashford Senior M1 LLC Ashford Junior M1 LLC Ashford TRS Senior M1 LLC Ashford TRS Junior M1 LLC Ashford Austin GP LLC Ashford Dallas GP LLC Ashford Las Vegas GP LLC Ashford TRS Austin LLC Ashford TRS Dallas LLC Ashford TRS Las Vegas LLC Ashford Senior M2 LLC Ashford Junior M2 LLC Ashford TRS Senior M2 LLC 4
Page 195
Ashford TRS Junior M2 LLC Ashford Senior A LLC Ashford Junior A LLC Ashford TRS Senior A LLC Ashford TRS Junior A LLC Ashford TRS Scottsdale LLC Ashford TRS Phoenix Airport LLC Ashford TRS Hawthorne LLC Ashford TRS Plymouth Meeting LLC Ashford TRS LV Hughes Center LLC Ashford TRS San Jose LLC Ashford Scottsdale GP LLC Ashford Phoenix Airport GP LLC Ashford Hawthorne GP LLC Ashford Plymouth Meeting GP LLC Ashford LV Hughes Center GP LLC Ashford San Jose GP LLC Ashford Senior B LLC Ashford Junior B LLC Ashford TRS Senior B LLC Ashford TRS Junior B LLC Ashford TRS Newark LLC Ashford TRS Oakland LLC Ashford TRS Manhattan Beach LLC Ashford TRS Basking Ridge LLC Ashford Newark GP LLC Ashford Oakland GP LLC Ashford Manhattan Beach GP LLC Ashford Basking Ridge GP LLC Ashford Senior C LLC Ashford Junior C LLC Ashford TRS Senior C1 LLC Ashford TRS Junior C1 LLC Ashford TRS Senior C2 LLC Ashford TRS Junior C2 LLC Ashford Fort Tower I GP LLC Ashford Coral Gables GP LLC Ashford TRS MV San Diego LLC Ashford TRS Minneapolis Airport LLC Ashford TRS Fort Tower I LLC Ashford TRS Coral Gables LLC Ashford Senior D LLC Ashford Junior D LLC Ashford TRS Senior D1 LLC Ashford TRS Junior D1 LLC 5
Page 196
Ashford TRS Senior D2 LLC Ashford TRS Junior D2 LLC Ashford TRS Dulles LLC Ashford TRS Santa Fe LLC Ashford TRS Market Center LLC Ashford TRS Beverly Hills LLC Ashford Dulles GP LLC Ashford Santa Fe GP LLC Ashford Market Center GP LLC Ashford Beverly Hills GP LLC Ashford Senior E LLC Ashford Junior E LLC Ashford TRS Senior E LLC Ashford TRS Junior E LLC Ashford TRS Philly LLC Ashford TRS Anchorage LLC Ashford Alexandria LP Ashford Alexandria GP LLC Ashford TRS Alexandria LLC Ashford Posada LP Ashford Posada GP LLC Ashford TRS Posada LLC Ashford Scotts Valley GP LLC Ashford Scotts Valley LP Ashford TRS Scotts Valley LLC Ashford C-1 LLC Ashford C-2 LLC Ashford TRS C-1 LLC Ashford TRS C-2 LLC Ashford TRS Annex LLC 815 Commerce LLC 815 Commerce Managing Member LLC 815 Commerce Master Tenant LLC 815 Commerce Construction Manager LLC Ashford TRS Marietta LLC Marietta Leasehold LP Marietta Leasehold GP LLC Ashford Alexandria Holding LLC Ashford TRS Alexandria Holding LLC Ashford Posada Holding LLC Ashford TRS Posada Holding LLC Ashford M Investor LLC Ashford TRS M Investor LLC Ashford Falls Church GP LLC Stirling Jacksonville IV Holding LLC 6
Page 197
Ashford Jacksonville IV GP LLC Ashford Jacksonville IV LP RI Manchester Holding LLC RI-CIH Manchester Parent, LLC RI Manchester Hotel Partners, LP Stirling Buford I Holding LLC Stirling Buford I GP LLC Ashford Buford I LP Stirling Buford II Holding LLC Stirling Buford II GP LLC Ashford Buford II LP Stirling TRS Buford I Holding LLC Stirling TRS Buford I LLC Stirling TRS Buford II Holding LLC Stirling TRS Buford II LLC RI TRS Manchester Holding LLC RI TRS Manchester LLC Stirling TRS Jacksonville IV Holding LLC Ashford TRS Jacksonville IV LLC 7
Page 198
EXHIBIT 23.1 Consent of Independent Registered Public Accounting Firm We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 333-108335, 333-132440, 333-164428, 333-174448, 333-202729, 333-218887, 333-256037, 333-264868, 333-271977, and 333-287950) of Ashford Hospitality Trust, Inc. of our report dated March 20, 2026, relating to the consolidated financial statements and schedule, which appears in this AnnualReport on Form 10-K. Our report contains an explanatory paragraph regarding the Company’s ability to continue as a going concern. /s/ BDO USA, P.C. Dallas, Texas March 20, 2026
Page 199
EXHIBIT 31.1 CERTIFICATION I, Stephen Zsigray, certify that: 1. I have reviewed this Annual Report on Form 10-K of Ashford Hospitality Trust, 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 officers 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)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) 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) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) 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 (d) 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 officers 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: March 20, 2026 /s/ STEPHEN ZSIGRAY Stephen Zsigray President and Chief Executive Officer
Page 200
EXHIBIT 31.2 CERTIFICATION I, Deric S. Eubanks, certify that: 1. I have reviewed this Annual Report on Form 10-K of Ashford Hospitality Trust, 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 officers 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)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) 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) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) 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 (d) 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 officers 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: March 20, 2026 /s/ DERIC S. EUBANKS Deric S. Eubanks Chief Financial Officer
Page 201
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 Annual Report of Ashford Hospitality Trust, Inc. (the “Company”) on Form 10-K for the year ended December 31, 2025, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Stephen Zsigray, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge: (1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; 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: March 20, 2026 /s/ STEPHEN ZSIGRAY Stephen Zsigray President and Chief Executive Officer
Page 202
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 Annual Report of Ashford Hospitality Trust, Inc. (the “Company”) on Form 10-K for the year ended December 31, 2025, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Deric S. Eubanks, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge: (1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; 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: March 20, 2026 /s/ DERIC S. EUBANKS Deric S. Eubanks Chief Financial Officer