Dallas, October 20 (Reuters) / PRNewswire / -- Ashford Hospitality Trust, Inc. (New York Stock Exchange ticker: AHT, hereinafter referred to as the "Company") announced today that its consultant Ashford Inc has agreed to waive approximately $17 million in consulting fees that would have been due over the next six months, and also agrees to purchase 2.5% of the Company's outstanding common stock in the public market each quarter; at the same time, the Company has terminated its equity financing plan to issue ATM at market price. This fee waiver and share purchase agreement has been approved by the Company's board of directors' independent directors. The Company stated that these measures are intended to enhance liquidity and further align the interests of the consultant with those of the shareholders.
"Independent directors have two goals in pushing for these agreements: to improve the company's liquidity and to align the advisors' capital with that of the shareholders," said Amish Gupta, the vice chairman and chief independent director. "The fee exemptions will save the company approximately $17 million over the next six months. The share purchase agreement goes a step further. Ashford Inc has committed to purchasing our common shares every quarter; if they fail to do so, they will also have to pay a fee exemption equivalent to 150% of the weighted average trading price of the un-purchased shares during that six-month period. This structure directly ties the advisors' interests to those of the common shareholders."
"Since 2014, Ashford Inc has been providing advisory services to Ashford Trust. We are committed to its long-term success," stated Ashford Inc's President Hector Sanchez. "These agreements concretize this commitment. We will waive six months' worth of fees and will purchase Ashford Trust's common shares with our own capital on a quarterly basis, standing alongside its shareholders."
Advisory Fee Exemption
Ashford Inc has irrevocably waived the base consulting fees and incentive consulting fees that were to be accrued for providing consulting services during the six-month period from November 2026 to April 2027. The waived fees will not be paid at any time in the future. The company expects that this move will save approximately $17 million, which is equivalent to $2.60 per common share.
Share Purchase Agreement
According to the share purchase agreement signed today, Ashford Inc commits to purchasing shares equivalent to 2.5% of the company's outstanding common stock in the public market each calendar quarter starting from the quarter ending September 30, 2026. Based on the current number of 6.47 million outstanding common shares, the purchase commitment for the first quarter is approximately 162,000 shares. Ashford Inc has six months after each quarter end to complete the purchases for that quarter; therefore, the purchases for the quarter ending September 30, 2026, must be completed by March 31, 2027. If they fail to purchase the full amount within this period, they must provide the company with a compensation in the form of future advisory fees, amounting to 150% of the weighted average price of common stock trading during those six months, multiplied by each share not purchased.
Ashford Inc will make purchases through a trading plan designed to comply with the Securities Exchange Act of 1934 Rule 10b5-1, or during open trading hours, and all such purchases must comply with applicable securities laws. The company will not issue or sell any shares directly to Ashford Inc under this agreement. Purchases are also subject to the limits on shareholding stipulated in the company's articles of association and rights agreement, which is valid for a maximum of three years and may be terminated early under certain circumstances, including when Ashford Inc reaches the aforementioned shareholding limit.
Termination of the market-price issuance plan
The company has terminated the equity distribution agreement it signed with Virtu Americas LLC on April 11, 2022. Under this agreement, the company was originally able to sell common shares through the ATM method. The company no longer possesses the ATM plan that could be used for the issuance of additional common shares.
For more information regarding fee exemptions and share purchase agreements, it will be included in the company's 8-K report submitted to the U.S. Securities and Exchange Commission.
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Ashford Hospitality Trust is a real estate investment trust fund ( REIT ), which primarily invests in high-end, full-service hotels.
Forward-looking Statements
Certain statements and assumptions in this press release contain or are based on “forward-looking” information and are made under the safe harbor provisions of federal securities regulations. Forward-looking statements can typically be identified by words such as “may”, “will”, “should”, “potential”, “intends”, “expects”, “anticipates”, “estimates”, “approximately”, “believes”, “could”, “plans”, “predicts”, and similar phrases. In addition, the following statements are also forward-looking in nature: our business and investment strategies; the savings expected from the exemption of advisory fees; the timing, quantity, and price of Ashford Inc’s purchase of our common stock, as well as the amount of any fee credits under the share purchase agreement; our ability to maintain our common stock listed on the New York Stock Exchange; anticipated or planned asset purchases, sales, or dispositions; our estimated operating results; the completion of any pending transactions; our ability to restructure existing debt; our ability to obtain additional financing to support our operations; our understanding of the competitive landscape; anticipated capital expenditures; and the impact of technology on our operations and business. These forward-looking statements are based on our beliefs, assumptions, and expectations regarding future performance and take into account all information we currently know. The aforementioned beliefs, assumptions, and expectations may change due to many potential events or factors, not all of which are within our control. If changes occur, our business, financial condition, liquidity, operating results, plans, and other objectives may differ significantly from those expressed in the forward-looking statements. Investors should carefully consider this risk when making investment decisions regarding our securities. The above and other risk factors are discussed more fully in the documents submitted by the company to the U.S. Securities and Exchange Commission.
The forward-looking statements contained in this press release are only valid as of the date of issuance of this press release. Except as required by law, the company will not publicly update or revise any forward-looking statements due to new information, future events or circumstances, expected changes, or other reasons. Source: Ashford Hospitality Trust, Inc.











