10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

þ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2015

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 1100
Dallas, Texas	75254
(Address of principal executive offices)	(Zip code)

(972) 490-9600

(Registrant’s telephone number, including area code)

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 and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files). þ Yes ¨ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act):

Large accelerated filer	þ	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ¨ Yes þ No

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Common Stock, $0.01 par value per share	101,068,813
(Class)	Outstanding at May 7, 2015

ASHFORD HOSPITALITY TRUST, INC

FORM 10-Q

FOR THE QUARTER ENDED MARCH 31, 2015

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (unaudited)
Consolidated Balance Sheets as March 31, 2015 and December 31, 2014	2
Consolidated Statements of Operations for the Three Months Ended March 31, 2015 and 2014	3
Consolidated Statements of Comprehensive Income (Loss) for the Three Months Ended March 31, 2015 and 2014	4
Consolidated Statement of Equity for the Three Months Ended March 31, 2015	5
Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2015 and 2014	6
Notes to Consolidated Financial Statements	7
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	31
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	45
ITEM 4. CONTROLS AND PROCEDURES	45
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS	46
ITEM 1A. RISK FACTORS	46
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	48
ITEM 3. DEFAULTS UPON SENIOR SECURITIES	48
ITEM 4. MINE SAFETY DISCLOSURES	48
ITEM 5. OTHER INFORMATION	48
ITEM 6. EXHIBITS	49
SIGNATURES	51

PART I. FINANCIAL INFORMATION

ITEM 1.    FINANCIAL STATEMENTS (unaudited)

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(unaudited, in thousands, except share amounts)

	March 31, 2015			December 31, 2014
Assets
Cash and cash equivalents	$	355,727		$	215,063
Marketable securities	72,427			63,217
Total cash, cash equivalents and marketable securities	428,154			278,280
Investments in hotel properties, net	3,953,983			2,128,611
Restricted cash	143,043			85,830
Accounts receivable, net of allowance of $417 and $241, respectively	52,512			22,399
Inventories	4,188			2,104
Note receivable, net of allowance of $7,416 and $7,522, respectively	3,599			3,553
Investment in unconsolidated entities	58,971			206,790
Deferred costs, net	36,514			12,588
Prepaid expenses	22,757			7,017
Derivative assets, net	917			182
Other assets	7,969			17,116
Intangible assets, net	15,045			—
Due from Ashford Prime OP, net	335			896
Due from affiliates	—			3,473
Due from related party, net	1,922			—
Due from third-party hotel managers	39,047			12,241
Total assets	$	4,768,956		$	2,781,080
Liabilities and Equity
Liabilities:
Indebtedness	$	3,387,623		$	1,954,103
Accounts payable and accrued expenses	131,890			71,118
Dividends payable	23,346			21,889
Unfavorable management contract liabilities	4,836			5,330
Due to Ashford Inc., net	9,120			8,202
Due to related party, net	—			1,867
Due to third-party hotel managers	1,529			1,640
Intangible liabilities, net	27,262			—
Liabilities associated with marketable securities and other	12,771			6,201
Other liabilities	6,923			1,233
Total liabilities	3,605,300			2,071,583
Redeemable noncontrolling interests in operating partnership	165,590			177,064
Equity:
Preferred stock, $0.01 par value, 50,000,000 shares authorized:
Series A Cumulative Preferred Stock, 1,657,206 shares issued and outstanding at March 31, 2015 and December 31, 2014	17			17
Series D Cumulative Preferred Stock, 9,468,706 shares issued and outstanding at March 31, 2015 and December 31, 2014	95			95
Series E Cumulative Preferred Stock, 4,630,000 shares issued and outstanding at March 31, 2015 and December 31, 2014	46			46
Common stock, $0.01 par value, 200,000,000 shares authorized, 124,896,765 shares issued, 101,078,531 and 89,439,624 shares outstanding at March 31, 2015 and December 31, 2014, respectively	1,249			1,249
Additional paid-in capital	1,801,656			1,706,274
Accumulated deficit	(696,787		)	(1,050,323		)
Treasury stock, at cost, 23,818,234 and 35,457,141 shares at March 31, 2015 and December 31, 2014, respectively	(108,985		)	(125,725		)
Total stockholders’ equity of the Company	997,291			531,633
Noncontrolling interests in consolidated entities	775			800
Total equity	998,066			532,433
Total liabilities and equity	$	4,768,956		$	2,781,080

See Notes to Consolidated Financial Statements.

2

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited, in thousands, except per share amounts)

	Three Months Ended March 31,
	2015			2014
Revenue
Rooms	$	200,990		$	156,997
Food and beverage	39,553			28,239
Other hotel revenue	8,832			6,366
Total hotel revenue	249,375			191,602
Advisory services revenue	—			2,194
Other	860			1,065
Total revenue	250,235			194,861
Expenses
Hotel operating expenses:
Rooms	43,153			34,754
Food and beverage	26,280			19,323
Other expenses	74,782			58,274
Management fees	9,657			7,742
Total hotel expenses	153,872			120,093
Property taxes, insurance, and other	11,594			9,589
Depreciation and amortization	37,864			26,152
Impairment charges	(106		)	(101		)
Transaction costs	499			—
Advisory services fee	9,567			—
Corporate, general, and administrative	4,840			12,735
Total expenses	218,130			168,468
Operating income	32,105			26,393
Equity in loss of unconsolidated entities	(6,622		)	(3,498		)
Interest income	16			6
Gain on acquisition of PIM Highland JV	381,835			—
Other income	4,330			1,277
Interest expense and amortization of premiums and loan costs	(34,635		)	(28,375		)
Write-off of loan costs and exit fees	(4,767		)	(2,028		)
Unrealized gain (loss) on marketable securities	(1,802		)	1
Unrealized loss on derivatives	(1,698		)	(347		)
Income (loss) from continuing operations before income taxes	368,762			(6,571		)
Income tax expense	(825		)	(216		)
Income (loss) from continuing operations	367,937			(6,787		)
Income from discontinued operations	—			4
Gain (loss) on sale of hotel properties, net of tax	(1,130		)	3,491
Net income (loss)	366,807			(3,292		)
Loss from consolidated entities attributable to noncontrolling interest	25			27
Net (income) loss attributable to redeemable noncontrolling interests in operating partnership	(45,336		)	877
Net income (loss) attributable to the Company	321,496			(2,388		)
Preferred dividends	(8,490		)	(8,490		)
Net income (loss) attributable to common stockholders	$	313,006		$	(10,878	)
Income (loss) per share - basic and diluted:
Basic:
Income (loss) from continuing operations attributable to common stockholders	$	3.25		$	(0.13	)
Income from discontinued operations attributable to common stockholders	—			—
Net income (loss) attributable to common stockholders	$	3.25		$	(0.13	)
Weighted average common shares outstanding – basic	95,539			81,690
Diluted:
Income (loss) from continuing operations attributable to common stockholders	$	3.13		$	(0.13	)
Income from discontinued operations attributable to common stockholders	—			—
Net income (loss) attributable to common stockholders	$	3.13		$	(0.13	)
Weighted average common shares outstanding – diluted	113,912			81,690
Dividends declared per common share	$	0.12		$	0.12
Amounts attributable to common stockholders:
Net income (loss) attributable to the Company	$	321,496		$	(2,391	)
Income from discontinued operations	—			3
Preferred dividends	(8,490		)	(8,490		)
Net income (loss) attributable to common stockholders	$	313,006		$	(10,878	)

See Notes to Consolidated Financial Statements.

3

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(unaudited, in thousands)

	Three Months Ended March 31,
	2015			2014
Net income (loss)	$	366,807		$	(3,292	)
Other comprehensive income, net of tax:
Reclassification to interest expense	—			71
Total other comprehensive income	—			71
Comprehensive income (loss)	366,807			(3,221		)
Less: Comprehensive loss attributable to noncontrolling interest in consolidated entities	25			27
Less: Comprehensive (income) loss attributable to redeemable noncontrolling interests in operating partnership	(45,336		)	868
Comprehensive income (loss) attributable to the Company	$	321,496		$	(2,326	)

See Notes to Consolidated Financial Statements.

4

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF EQUITY

(unaudited, in thousands)

	Preferred Stock												Additional Paid In Capital											Noncontrolling Interests In Consolidated Entities						Noncontrolling Interests in Operating Partnership
	Series A			Series D			Series E			Common Stock						Accumulated Deficit			Treasury Stock
	Shares	Amount		Shares	Amount		Shares	Amount		Shares	Amount								Shares		Amount						Total
Balance at January 1, 2015	1,657	$	17	9,469	$	95	4,630	$	46	124,897	$	1,249	$	1,706,274		$	(1,050,323	)	(35,457	)	$	(125,725	)	$	800		$	532,433		$	177,064
Purchases of treasury shares	—	—		—	—		—	—		—	—		—			—			(43	)	(446		)	—			(446		)	—
Equity-based compensation	—	—		—	—		—	—		—	—		107			—			—		—			—			107			64
Issuance of restricted shares/units	—	—		—	—		—	—		—	—		(2,269		)	—			1,013		2,269			—			—			33
Reissuance of treasury shares	—	—		—	—		—	—		—	—		96,228			—			10,530		14,711			—			110,939			—
Dividends declared- common shares	—	—		—	—		—	—		—	—		—			(12,129		)	—		—			—			(12,129		)	—
Dividends declared- preferred shares- Series A	—	—		—	—		—	—		—	—		—			(886		)	—		—			—			(886		)	—
Dividends declared- preferred shares- Series D	—	—		—	—		—	—		—	—		—			(5,000		)	—		—			—			(5,000		)	—
Dividends declared – preferred shares- Series E	—	—		—	—		—	—		—	—		—			(2,604		)	—		—			—			(2,604		)	—
Distributions to noncontrolling interests	—	—		—	—		—	—		—	—		—			—			—		—			—			—			(2,726		)
Redemption/conversion of operating partnership units	—	—		—	—		—	—		—	—		1,316			—			139		206			—			1,522			(1,522		)
Redemption value adjustment	—	—		—	—		—	—		—	—		—			52,659			—		—			—			52,659			(52,659		)
Net income (loss)	—	—		—	—		—	—		—	—		—			321,496			—		—			(25		)	321,471			45,336
Balance at March 31, 2015	1,657	$	17	9,469	$	95	4,630	$	46	124,897	$	1,249	$	1,801,656		$	(696,787	)	(23,818	)	$	(108,985	)	$	775		$	998,066		$	165,590

See Notes to Consolidated Financial Statements.

5

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited, in thousands)

	Three Months Ended March 31,
	2015			2014
Cash Flows from Operating Activities
Net income (loss)	$	366,807		$	(3,292	)
Adjustments to reconcile net income (loss) to net cash flow provided by operating activities:
Depreciation and amortization	37,864			26,229
Impairment charges	(106		)	(101		)
Amortization of loan costs and premiums, write-off of loan costs and exit fees	7,646			3,967
Bad debt expense	152			—
Equity in (earnings) loss of unconsolidated entities	6,622			3,498
Distribution of earnings from unconsolidated entities	249			—
Gain on hotel properties	(380,705		)	(3,503		)
Realized and unrealized gains on marketable securities	(2,275		)	(1,064		)
Purchases of marketable securities	(64,346		)	(22,553		)
Sales of marketable securities	64,036			22,319
Net settlement of trading derivatives	(1,367		)	(253		)
Unrealized loss on derivatives	1,698			347
Equity-based compensation	171			4,488
Changes in operating assets and liabilities, exclusive of effect of acquisitions and dispositions of hotel properties:
Restricted cash	3,003			(1,551		)
Accounts receivable and inventories	(10,405		)	(8,990		)
Prepaid expenses and other assets	(6,690		)	(5,413		)
Accounts payable and accrued expenses	13,780			2,513
Due from affiliates	3,473			541
Due to/from related party	(6,315		)	(1,114		)
Due to/from third-party hotel managers	(8,295		)	(1,828		)
Due to/from Ashford Prime OP, net	561			(2,655		)
Due to/from Ashford Inc., net	918			—
Other liabilities	3,851			(504		)
Net cash provided by operating activities	30,327			11,081
Cash Flows from Investing Activities
Proceeds from payments of note receivable	60			61
Net proceeds from sales of hotel properties	7,502			22,402
Dividends from Ashford Prime OP	—			249
Acquisition of hotel properties, net of cash acquired	(287,618		)	—
Change in restricted cash related to improvements and additions to hotel properties	49,703			—
Improvements and additions to hotel properties	(28,812		)	(26,956		)
Due from Ashford Prime OP	—			13,635
Payments of franchise fees	(175		)	—
Proceeds from property insurance	282			—
Net cash provided by (used in) investing activities	(259,058		)	9,391
Cash Flows from Financing Activities
Borrowings on indebtedness	1,581,032			200,000
Repayments of indebtedness and capital leases	(1,267,467		)	(169,503		)
Payments of loan costs and exit fees	(31,558		)	(3,831		)
Payments of dividends	(21,888		)	(20,734		)
Purchases of treasury shares	(446		)	(231		)
Payments for derivatives	(1,250		)	(216		)
Issuances of treasury stock	110,939			307
Distributions to noncontrolling interests in consolidated entities	—			(980		)
Other	33			46
Net cash provided by financing activities	369,395			4,858
Net increase in cash and cash equivalents	140,664			25,330
Cash and cash equivalents at beginning of period	215,063			128,780
Cash and cash equivalents at end of period	$	355,727		$	154,110
Supplemental Cash Flow Information
Interest paid	$	26,543		$	24,588
Income taxes paid	197			19
Supplemental Disclosure of Non-Cash Investing and Financing Activity
Accrued but unpaid capital expenditures	$	6,522		$	2,927
Deferred compensation to be settled in shares	—			183
Dividend receivable from Ashford Prime OP	249			249
Transfer of debt to Ashford Prime OP	—			69,000
Dividends declared but not paid	23,346			20,890

See Notes to Consolidated Financial Statements.

6

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

1. Organization and Description of Business

Ashford Hospitality Trust, Inc., together with its subsidiaries (“Ashford Trust”), is a real estate investment trust (“REIT”) focused on investing in the hospitality industry across all segments and in all methods including direct real estate, securities, equity, and debt. Other than Ashford Hospitality Trust, Inc.’s investment in Ashford Inc. common stock, 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. In this report, terms such as the “Company,” “we,” “us,” or “our” refer to Ashford Hospitality Trust, Inc. and all entities included in its consolidated financial statements.

On December 14, 2014, we executed a Letter Agreement (the “Agreement”) with PRISA III Investments ("PRISA III"). The Agreement was approved by the investment committee of Prudential Real Estate Investors ("PREI"), the investment manager of PRISA III, and fully executed and delivered to us on December 15, 2014. Pursuant to the Agreement, we agreed to purchase and PRISA III agreed to sell (the “Transaction”) all of PRISA III’s right, title and interest in and to its approximately 28.26% interest in the PIM Highland Holding LLC (“PIM Highland JV”). As of March 6, 2015, we own 100% of the PIM Highland JV. See Notes 3, 6 and 7.

We are advised by Ashford Hospitality Advisors LLC (“Ashford LLC”), a subsidiary of Ashford Inc., through an advisory agreement. All of the hotels 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.

As of March 31, 2015, we owned interests in the following assets:

• 116 consolidated hotel properties, including 114 directly owned and two owned through a majority-owned investment in a consolidated entity, which represent 25,579 total rooms (or 25,552 net rooms excluding those attributable to our partners);

• 10 hotel properties owned through a 15.2% interest in Ashford Hospitality Prime Limited Partnership (“Ashford Prime OP”) with a carrying value of $54.6 million;

• 86 hotel condominium units at WorldQuest Resort in Orlando, Florida;

• a 30.1% ownership in Ashford Inc. common stock with a carrying value of $4.4 million; and

• a mezzanine loan with a carrying value of $3.6 million.

For federal income tax purposes, we have elected to be treated as a REIT, which imposes limitations related to operating hotels. As of March 31, 2015, our 116 hotel properties were leased or owned by our wholly owned subsidiaries that are treated as taxable REIT subsidiaries for 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.

As of March 31, 2015, Remington Lodging & Hospitality, LLC, together with its affiliates (“Remington Lodging”), which is beneficially wholly owned by Mr. Monty J. Bennett, our Chairman and Chief Executive Officer, and Mr. Archie Bennett, Jr., our Chairman Emeritus, managed 76 of our 116 hotel properties, one of the 10 Ashford Prime OP hotel properties and WorldQuest Resort. Third-party management companies managed the remaining hotel properties.

2. Significant Accounting Policies

Basis of Presentation—The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These consolidated financial statements include the accounts of Ashford Hospitality Trust, Inc., its majority-owned subsidiaries, and its majority-owned entities in which it has a controlling interest. All significant intercompany accounts and transactions between consolidated entities have been eliminated in these consolidated financial statements. These consolidated financial statements and related notes should be read in conjunction with the consolidated financial statements and notes thereto included in our 2014 Annual Report to Stockholders on Form 10-K and Form 10-K/A filed with the Securities and Exchange Commission (“SEC”) on March 2, 2015, and March 31, 2015, respectively.

7

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The following items affect reporting comparability related to our consolidated financial statements:

• Historical seasonality patterns at some of our properties cause fluctuations in our overall operating results. Consequently, operating results for the three months ended March 31, 2015, are not necessarily indicative of the results that may be expected for the year ending December 31, 2015.

• On March 1, 2014, we completed the sale of the Pier House Resort to Ashford Prime (“Ashford Prime”). The results of the Pier House Resort, which we acquired on May 14, 2013, and sold on March 1, 2014, are included in our results of operations for the period from January 1, 2014, through February 28, 2014.

• On February 6, 2015, we acquired the Lakeway Resort & Spa, and on February 25, 2015, we acquired the Memphis Marriott East hotel. The results of these hotels are included in our results of operations as of their respective acquisition dates.

• On March 6, 2015, we acquired the remaining approximate 28.26% interest in the 28 hotels of the PIM Highland JV. For the period January 1, 2014, through March 5, 2015, we have recorded equity in earnings for our ownership percentage. Beginning March 6, 2015, we consolidated the results of operations of these hotels.

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.

Restricted Cash—Restricted cash includes reserves for debt service, real estate taxes, and insurance, as well as excess cash flow deposits and reserves for furniture, fixtures, and equipment replacements of approximately 3% to 6% of property revenue for certain hotels, as required by certain management or mortgage debt agreement restrictions and provisions. For purposes of the consolidated statements of cash flows, changes in restricted cash caused by using such funds for debt service, real estate taxes, and insurance are shown as operating activities. Changes in restricted cash caused by using such funds for furniture, fixtures, and equipment replacements are included in cash flows from investing activities.

Investments in Hotel Properties, net—Hotel properties are generally stated at cost. However, four hotel properties contributed upon Ashford Trust’s formation in 2003 are stated at the predecessor’s historical cost, net of impairment charges, if any, plus a partial step-up related to the acquisition of noncontrolling interests from third parties associated with certain of these properties. For hotel properties owned through our majority-owned entities, the carrying basis attributable to the partners’ minority ownership is recorded at the predecessor’s historical cost, net of any impairment charges, while the carrying basis attributable to our majority ownership is recorded based on the allocated purchase price of our ownership interests in the entities. All improvements and additions which extend the useful life of hotel properties are capitalized.

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. No impairment charges were recorded for investments in hotel properties for the three months ended March 31, 2015 and 2014.

Hotel Dispositions—Effective January 1, 2015, 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 anticipate that dispositions of hotel properties will 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. This new guidance is to be implemented prospectively only. As such, hotel property dispositions that occurred prior to December 31, 2014, will continue to be reported as discontinued operations in the statements of operations for all applicable periods presented. See Note 4.

Assets Held for Sale and Discontinued Operations—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 or group of components that represents a strategic shift that has (or will have) a major effect on our operations and cash flows.

8

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Intangible Assets and Liabilities—Intangible assets and liabilities represent the assets and liabilities recorded on certain hotel properties’ ground lease contracts that were below or above market rates at the date of acquisition. These assets and liabilities are amortized using the straight-line method over the remaining terms of the respective lease contracts.

Note Receivable—Mezzanine loan financing, classified as note receivable, represents a loan held for investment and intended to be held to maturity. Note receivable is recorded at cost, net of unamortized loan origination costs and fees, loan purchase discounts, and allowance for losses when a loan is deemed to be impaired. Premiums, discounts, and net origination fees are amortized or accreted as an adjustment to interest income using the effective interest method over the life of the loan. We discontinue recording interest and amortizing discounts/premiums when the contractual payment of interest and/or principal is not received when contractually due. Payments received on impaired nonaccrual loans are recorded as adjustments to impairment charges. No interest income was recorded for the three months ended March 31, 2015 and 2014.

Variable interest entities (“VIEs”), as defined by authoritative accounting guidance, must be consolidated by their controlling interest beneficiaries if the VIEs do not effectively disperse risks among the parties involved. Our remaining mezzanine note receivable at March 31, 2015, is secured by a hotel property and is subordinate to the controlling interest in the secured hotel property. Although the note receivable is considered to be a variable interest in the entity that owns the related hotel, we are not considered to be the primary beneficiary of the hotel property as a result of holding the loan. Therefore, we do not consolidate the hotel property for which we have provided financing. We will evaluate interests in entities acquired or created in the future to determine whether such entities should be consolidated. In evaluating VIEs, our analysis involves considerable management judgment and assumptions.

Impairment of Note Receivable—We review notes receivable for impairment each reporting period. A loan is impaired when, based on current information and events, collection of all amounts recorded as assets on the balance sheet is no longer considered probable. We apply normal loan review and underwriting procedures (as may be implemented or modified from time to time) in making that judgment.

When a loan is impaired, we measure impairment based on the present value of expected cash flows discounted at the loan’s effective interest rate against the value of the asset recorded on the balance sheet. We may also measure impairment based on a loan’s observable market price or the fair value of collateral if the loan is collateral-dependent. 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 during the three months ended March 31, 2015 and 2014. Valuation adjustments of $(106,000) and $(101,000) on previously impaired notes were credited to impairment charges during the three months ended March 31, 2015 and 2014, respectively.

Investments in Unconsolidated Entities—Investments in entities in which we have ownership interests ranging from 14.4% to 30.1% 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 in our unconsolidated entities for impairment in 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 impairment is recorded in equity earnings (loss) in unconsolidated entities. No such impairment was recorded in the three months ended March 31, 2015 and 2014.

Our investments in certain unconsolidated entities are considered to be variable interests in the underlying entities. Variable Interest Entities (“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, (ii) an implicit financial responsibility to ensure that a VIE operates as designed, and (iii) 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 should not be consolidated. In evaluating VIEs, our analysis involves considerable management judgment and assumptions.

Marketable Securities—Marketable securities, including U.S. treasury bills, publicly traded equity securities and stocks, and put and call options on certain publicly traded securities. All of these investments are recorded at fair value. Put and call options are considered derivatives. The fair value of these investments has been determined based on the closing price as of the balance sheet date and is reported as “marketable securities” or “liabilities associated with marketable securities and other” in the consolidated balance sheets. The cost of securities sold is determined by using the high cost method. Net investment income, including interest income (expense), dividends, realized gains or losses and costs of investment, is reported as a component of “other income.” Unrealized gains and losses on these investments are reported as “unrealized gain (loss) on marketable securities” in the consolidated statements of operations.

9

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Due to/from Affiliates—Due to/from affiliates represents current receivables and payables resulting primarily from advances of shared costs incurred. Both due to/from affiliates are generally settled within a period not exceeding one year.

Due to/from Related Party—Due to/from related party represents current receivables and payables resulting from transactions related to hotel management, project management and market services with a related party. Due to/from related party is generally settled within a period not exceeding one year.

Due to/from Ashford Prime OP, net—Due to/from Ashford Prime OP represents receivables and payables resulting primarily from miscellaneous operating and capital improvement true-ups between the two entities. In 2014, we had receivables related to advisory fees. Both due to/from Ashford Prime OP is generally settled within a period not exceeding one year.

Due to Ashford Inc., net—Due to Ashford Inc., net, represents current payables resulting primarily from advisory services fee, including reimbursable expenses. In 2014, due to Ashford Inc., net, included payables resulting primarily from costs associated with the spin-off of Ashford Inc. Due to Ashford Inc., net, is generally settled within a period not exceeding one year.

Revenue Recognition—Hotel revenues, including room, food, beverage, and ancillary revenues such as long-distance telephone service, laundry, parking and space rentals, are recognized when services have been rendered. Taxes collected from customers and submitted to taxing authorities are not recorded in revenue. Interest income (including accretion of discounts on the mezzanine loan using the effective interest method) is recognized when earned. We discontinue recording interest and amortizing discounts/premiums when the contractual payment of interest and/or principal is not received when contractually due. We are reimbursed by PIM Highland JV for costs associated with managing its day-to-day operations and providing corporate administrative services such as accounting, insurance, marketing support, asset management and other services. Beginning with the three months ended March 31, 2014, we changed the presentation to report such reimbursements as “Other” revenue as opposed to credits within “Corporate, general and administrative” expense. This change had no impact on our financial condition or results of operations. As of March 6, 2015, we acquired the remaining approximate 28.26% of the PIM Highland JV which discontinued the aforementioned reimbursements.

Prior to the spin-off of Ashford Inc. in November 2014, we recognized advisory services revenue when services had been rendered. The quarterly base fee was equal to 0.7% per annum of the total market capitalization, as defined in the advisory agreement, of Ashford Prime, subject to certain minimums. Reimbursements for overhead and internal audit services was recognized when services had been rendered. We also recorded advisory services revenue for equity grants of Ashford Prime common stock and LTIP units awarded to our officers and employees in connection with providing advisory services equal to the fair value of the award in proportion to the requisite service period satisfied during the period, as well as an offsetting expense in an equal amount included in “corporate, general and administrative” expense.

Derivatives Instruments and Hedging—We use interest rate derivatives to hedge our risks and to capitalize on the historical correlation between changes in LIBOR (London Interbank Offered Rate) and RevPAR (Revenue per Available Room). Interest rate derivatives could include swaps, caps, floors and flooridors. We assess the effectiveness of each hedging relationship by comparing changes in fair value or cash flows of the derivative hedging instrument with the changes in fair value or cash flows of the designated hedged item or transaction. We also use credit default swaps to hedge financial and capital market risk. All of our derivatives are subject to master-netting settlement arrangements and the credit default swaps are subject to credit support annexes. For credit default swaps, cash collateral is posted by us as well as our counterparty. We offset the fair value of the derivative and the obligation/right to return/reclaim cash collateral.

All derivatives are recorded at fair value in accordance with the applicable authoritative accounting guidance. Interest rate derivatives and credit default swaps are reported as “Derivative assets, net” or “Liabilities associated with marketable securities and other” in the consolidated balance sheets. Accrued interest on non-hedge designated interest rate derivatives is included in “Accounts receivable, net” in the consolidated balance sheets. For interest rate derivatives designated as cash flow hedges:

a) the effective portion of changes in fair value is initially reported as a component of “Accumulated other comprehensive income (loss)” (“OCI”) in the equity section of the consolidated balance sheets and reclassified to interest expense in the consolidated statements of operations in the period during which the hedged transaction affects earnings, and

b) the ineffective portion of changes in fair value is recognized directly in earnings as “Unrealized gain (loss) on derivatives” in the consolidated statements of operations. For the three months ended March 31, 2015 and 2014, there was no ineffectiveness.

For non-hedge designated interest rate derivatives and credit default swaps, changes in fair value are recognized in earnings as “unrealized loss on derivatives” in the consolidated statements of operations.

10

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

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 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.

The “Income Taxes” Topic of the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification 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 2011 through 2014 remain subject to potential examination by certain federal and state taxing authorities.

Reclassification—Certain amounts in the consolidated financial statements for the three months ended March 31, 2014, have been reclassified for discontinued operations.

Recently Adopted Accounting Standards—In April 2014, the FASB issued accounting guidance that revises the definition of discontinued operations by limiting discontinued operations reporting to disposals of components of an entity that represent strategic shifts that have (or will have) a major effect on an entity’s operations and financial results, removing the lack of continuing involvement criteria and requiring discontinued operations reporting for the disposal of an equity method investment that meets the definition of discontinued operations. The update also requires expanded disclosures for discontinued operations, including disclosure of pretax profit or loss of an individually significant component of an entity that does not qualify for discontinued operations reporting. The new accounting guidance is effective prospectively for fiscal years, and interim periods within those years, beginning after December 15, 2014. We adopted this accounting guidance on January 1, 2015. The adoption of this accounting guidance impacted the presentation of our results of operations as it required the operations of our disposed hotel property to be included in continuing operations.

Recently Issued Accounting Standards—In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). ASU 2014-09 is a comprehensive new revenue recognition model, which requires a company to recognize revenue to depict the transfer of promised goods or services to a customer in an amount that reflects the consideration the company expects to receive in exchange for those goods or services. The update will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. ASU 2014-09 is effective in fiscal periods beginning after December 15, 2016. Early adoption is not permitted. The standard permits the use of either the retrospective or cumulative effect transition method. We are evaluating the effect that ASU 2014-09 will have on our consolidated financial statements and related disclosures. We have not yet selected a transition method.

In August 2014, the FASB issued ASU 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (“ASU 2014-15”), to provide guidance on management's responsibility to perform interim and annual assessments of an entity’s ability to continue as a going concern and to provide related disclosure requirements. ASU 2014-15 applies to all entities and is effective for annual periods ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. We do not expect the adoption of this standard will have an impact on our financial position, results of operations or cash flows.

In February 2015, the FASB issued ASU 2015-02, Amendments to the Consolidation Analysis. The ASU amends the consolidation guidance for VIEs and general partners' investments in limited partnerships and modifies the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities. The ASU is effective for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. We are currently evaluating the effect of the ASU on our consolidated financial statements and related disclosures.

In April 2015, the FASB issued Accounting Standards Update (“ASU”) No. 2015-03, Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. The new standard requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The standard is effective for annual reporting periods beginning after December 15, 2015, and interim periods within those fiscal years, with early adoption permitted. Upon adoption of the standard we will reclassify deferred financing

11

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

costs, net from total assets to be shown net of debt in the liabilities section of our consolidated balance sheet. Adoption of this standard will only affect the presentation of our consolidated balance sheet.

3. Investments in Hotel Properties, net

Investments in hotel properties, net consisted of the following (in thousands):

	March 31, 2015			December 31, 2014
Land	$	661,499		$	358,514
Buildings and improvements	3,535,862			2,125,656
Furniture, fixtures, and equipment	346,744			211,777
Construction in progress	16,563			11,704
Condominium properties	12,153			12,065
Total cost	4,572,821			2,719,716
Accumulated depreciation	(618,838		)	(591,105		)
Investments in hotel properties, net	$	3,953,983		$	2,128,611

Acquisitions

On February 6, 2015, we acquired a 100% interest in the Lakeway Resort & Spa (“Lakeway Resort”) in Austin, Texas, for total consideration of $33.5 million. The acquisition was funded with cash. We have allocated the assets acquired and liabilities assumed on a preliminary basis using the estimated fair value information currently available. This valuation is considered a Level 3 valuation technique. We are in the process of obtaining necessary information and evaluating the values assigned to investment in hotel properties and property level working capital balances. Thus, the balances reflected below are subject to change and could result in adjustments. Any change to the amounts recorded within the investments in hotel properties will also impact depreciation and amortization expense.

The following table summarizes the preliminary fair value of the assets acquired and liabilities assumed in the acquisition (in thousands):

Land	$	4,541
Buildings and improvements	24,703
Furniture, fixtures, and equipment	4,237
	33,481
Net other assets and liabilities	(382		)

The results of operations of the hotel property have been included in our results of operations since February 6, 2015. For the three months ended March 31, 2015, we have included total revenue of $1.8 million and net loss of $58,000 in our consolidated statements of operations.

On February 25, 2015, we acquired a 100% interest in the Memphis Marriott East (“Memphis Marriott”) hotel in Memphis, Tennessee for total consideration of $43.5 million. The acquisition was funded with cash. We have allocated the assets acquired and liabilities assumed on a preliminary basis using the estimated fair value information currently available. This valuation is considered a Level 3 valuation technique. We are in the process of obtaining necessary information and evaluating the values assigned to investment in hotel properties and property level working capital balances. Thus, the balances reflected below are subject to change and could result in adjustments. Any change to the amounts recorded within the investments in hotel properties will also impact depreciation and amortization expense.

12

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The following table summarizes the preliminary fair value of the assets acquired and liabilities assumed in the acquisition (in thousands):

Land	$	6,210
Buildings and improvements	32,934
Furniture, fixtures, and equipment	4,350
	43,494
Net other assets and liabilities	34

The results of operations of the hotel property have been included in our results of operations since February 25, 2015. For the three months ended March 31, 2015, we have included total revenue of $1.2 million and net income of $152,000 in our consolidated statements of operations.

On March 25, 2015, we completed the financing of a $33.3 million mortgage loan, secured by the Memphis Marriott. See Note 7.

As previously discussed in Note 1, we acquired the remaining approximate 28.26% interest in the PIM Highland JV. The transaction closed on March 6, 2015, for consideration of $250.1 million in cash. We recognized a gain of $381.8 million. Subsequent to the close of the transaction, $907.6 million of existing debt of the PIM Highland JV was refinanced. See Note 7. We have allocated the assets acquired and liabilities assumed on a preliminary basis using the estimated fair value information currently available. This valuation is considered a Level 3 valuation technique. We are in the process of obtaining necessary information and evaluating the values assigned to investment in hotel properties and property level working capital balances. We are also in the process of evaluating the fair value of intangibles associated with above and below market leases which could impact rent expense. Thus, the balances reflected below are subject to change and could result in adjustments. Any change to the amounts recorded within the investments in hotel properties will also impact depreciation and amortization expense.

The following table summarizes the preliminary fair value of the assets acquired and liabilities assumed in the acquisition (in thousands):

Land	$	292,934
Buildings and improvements	1,351,293
Furniture, fixtures, and equipment	118,878
	1,763,105
Indebtedness	(1,120,082		)
Net other assets and liabilities	105,814

The results of operations of the hotel properties have been included in our results of operations since March 6, 2015. For the three months ended March 31, 2015, we have included total revenue of $37.6 million and net income of $434,000 in our consolidated statements of operations.

13

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Subsequent to March 31, 2015, on April 29, 2015, we completed the acquisition of the Hampton Inn & Suites in Gainesville, Florida for total consideration of $25.3 million in cash.

The following table reflects the unaudited pro forma results of operations as if all acquisitions had occurred and the applicable indebtedness was incurred on January 1, 2014 and the removal of $495,000 of non-recurring transaction costs and gain on acquisition of the PIM Highland JV of $381.8 million. The table also reflects the removal of equity in loss in unconsolidated entity of $3.8 million and $2.8 million for the three month ended March 31, 2015 and 2014, respectively. These adjustments are directly attributable to the transactions for the three months ended March 31, 2015 (in thousands):

	Three Months Ended March 31,
	2015			2014
Total revenue	$	330,830		$	310,103
Net loss	(23,129		)	(11,466		)

4. Hotel Dispositions

Effective January 1, 2015, discontinued operations according to ASU 2014-08 are defined as the disposal of components of an entity that represent strategic shifts that have (or will have) a major effect on an entity’s operations and financial results. As a result, operations of hotels sold subsequent to December 31, 2014 will continue to be reported in continuing operations, while gains/losses on disposition will be included in gain/loss on sale of property, after continuing operations. For transactions that have been classified as discontinued operations for periods prior to ASU 2014-08, we will continue to present the operating results as discontinued operations in the statements of operations for all applicable periods presented.

In March 2015, we completed the sale of the Hampton Inn hotel in Terre Haute, Indiana. We included operations for this hotel through the date of disposition in income (loss) from continuing operations as shown in the consolidated statements of operations for the three months ended March 31, 2015 and 2014, as disposition of this hotel does not represent a strategic shift in our business.

The following table includes condensed financial information from this hotel (in thousands):

	Three Months Ended March 31,
	2015			2014
Total hotel revenue	$	361		$	472
Total hotel operating expenses	(308		)	(430		)
Operating income	53			42
Property taxes, insurance and other	(40		)	(41		)
Depreciation and amortization	(164		)	(150		)
Interest expense and amortization of loan costs	—			(128		)
Loss from continuing operations	(151		)	(277		)
Loss on sale of hotel property	(1,130		)	—
Net loss	(1,281		)	(277		)
Net loss from continuing operations attributable to redeemable noncontrolling interests in operating partnership	147			36
Loss from continuing operations attributable to the Company	$	(1,134	)	$	(241	)

In November 2014, we completed the sale of the Homewood Suites hotel in Mobile, Alabama. Since this hotel sold prior to ASU 2014-08, we will continue to present the operating results as discontinued operations in the statements of operations for all applicable periods presented. The following table includes condensed financial information from this hotel for the three months ended March 31, 2014 (in thousands):

14

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

	Three Months Ended March 31,
	2014
Hotel revenues	$	735
Hotel operating expenses	(473		)
Operating income	262
Property taxes, insurance and other	(31		)
Depreciation and amortization	(77		)
Interest expense and amortization of loan costs	(150		)
Net income	4
Income from discontinued operations attributable to redeemable noncontrolling interests in operating partnership	(1		)
Income from discontinued operations attributable to the Company	$	3

5. Note Receivable

At March 31, 2015 and December 31, 2014, we had one mezzanine loan receivable with a net carrying value of $3.6 million, net of a valuation allowance of $7.4 million and $7.5 million, respectively. This note is secured by one hotel property, bears interest at a rate of 6.09%, and matures in 2017. All required payments on this loan are current. Ongoing payments are treated as reductions of carrying value with related valuation allowance adjustments recorded as credits to impairment charges.

6. Investment in Unconsolidated Entities

We held a 71.74% common equity interest and a $25.0 million, or 50%, preferred equity interest earning an accrued but unpaid 15% annual return with priority over common equity distributions in PIM Highland JV, a 28-hotel portfolio venture. Although we had majority ownership in PIM Highland JV, all major decisions related to the joint venture, including establishment of policies and operating procedures with respect to business affairs and incurring obligations and expenditures, were subject to the approval of an executive committee, which was comprised of four persons with us and our partner each designating two of those persons. As a result, we utilized the equity accounting method with respect to the PIM Highland JV.

As previously discussed, pursuant to the Agreement, we agreed to purchase and PRISA III agreed to sell all of PRISA III’s right, title and interest in and to its approximately 28.26% interest in the PIM Highland JV. As of March 6, 2015, we own 100% of the PIM Highland JV. Prior to the acquisition of the remaining approximate 28.26% interest in the PIM Highland JV, we had a carrying value of $144.8 million at December 31, 2014. The acquisition-date fair value of the previous equity interest was $522.8 million and is included in the measurement of the consideration transferred. We recognized a gain of $381.8 million as a result of remeasuring our equity interest in PIM Highland JV before the business combination. See Note 3 for unaudited pro forma results of operations and Note 7 for indebtedness related to the PIM Highland JV.

The following tables summarize the consolidated balance sheet as of December 31, 2014 and the consolidated statements of operations for the period from January 1, 2015 through March 5, 2015 and the three months ended March 31, 2014 of the PIM Highland JV (in thousands):

PIM Highland JV

Condensed Consolidated Balance Sheet

	December 31, 2014
Total assets	$	1,394,806
Total liabilities	1,166,682
Members’ equity	228,124
Total liabilities and members’ equity	$	1,394,806
Our ownership interest in PIM Highland JV	$	144,784

15

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

PIM Highland JV

Condensed Consolidated Statements of Operations

	Period from January 1 to March 5,			Three Months Ended March 31,
	2015			2014
Total revenue	$	76,695		$	108,761
Total operating expenses	(69,949		)	(95,388		)
Operating income	6,746			13,373
Interest income and other	17			13
Interest expense, amortization and write-offs of deferred loan costs, discounts and premiums and exit fees	(10,212		)	(15,908		)
Other expenses	—			(44		)
Income tax expense	(1,222		)	(447		)
Net loss	$	(4,671	)	$	(3,013	)
Our equity in loss of PIM Highland JV	$	(3,836	)	$	(2,754	)

At March 31, 2015 and December 31, 2014, we held a 15.2% and 14.9%, respectively, ownership interest in Ashford Prime OP, a 10-hotel portfolio, totaling 3,707 rooms (3,472 net rooms excluding those attributable to our partners).

The following tables summarize the condensed consolidated balance sheets as of March 31, 2015 and December 31, 2014 and the condensed consolidated statements of operations for the three months ended March 31, 2015 and 2014, of Ashford Prime OP (in thousands):

Ashford Hospitality Prime Limited Partnership

Condensed Consolidated Balance Sheets

	March 31, 2015		December 31, 2014
Total assets	$	1,225,832	$	1,229,508
Total liabilities	815,555		805,510
Partners’ capital	410,277		423,998
Total liabilities and partners’ capital	$	1,225,832	$	1,229,508
Our ownership interest in Ashford Prime OP	$	54,613	$	54,907

16

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Ashford Hospitality Prime Limited Partnership

Condensed Consolidated Statements of Operations

	Three Months Ended March 31,
	2015			2014
Total revenue	$	77,789		$	61,806
Total operating expenses	(69,530		)	(57,031		)
Operating income	8,259			4,775
Interest income	4			4
Other Income	139			—
Interest expense and amortization and write-offs of loan costs	(9,637		)	(8,989		)
Unrealized gain on investments	1,323			—
Unrealized loss on derivatives	(32		)	(15		)
Income tax expense	(481		)	(226		)
Net loss	(425		)	(4,451		)
Loss from consolidated entities attributable to noncontrolling interests	147			405
Net loss attributable to Ashford Prime OP	$	(278	)	$	(4,046	)
Our equity in loss of Ashford Prime OP	$	(45	)	$	(744	)

On February 27, 2014, we announced that our Board of Directors had approved a plan to spin-off our asset management business into a separate publicly traded company in the form of a taxable special distribution. The spin-off was completed on November 12, 2014, with a pro-rata taxable distribution of Ashford Inc.’s common stock to our common stockholders of record as of November 11, 2014. The distribution was comprised of one share of Ashford Inc. common stock for every 87 shares of our common stock held by our stockholders. In addition for each common unit of our operating partnership the holder received a common unit of the operating limited liability company subsidiary of Ashford Inc. Each holder of common units of the operating limited liability company of Ashford Inc. could exchange up to 99% of those units for shares of Ashford Inc. stock at the rate of one share of Ashford Inc. common stock for every 55 common units. The exchange occurred on November 12, 2014, simultaneously with the distribution to common stockholders. Following the spin-off, we continue to hold approximately 598,000 shares of Ashford Inc. common stock for the benefit of our common stockholders, which represents an approximate 30.1% ownership interest in Ashford Inc. at the time of the spin-off. In connection with the spin-off, we entered into a 20-year advisory agreement with Ashford Inc.

17

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The following tables summarize the condensed balance sheets as of March 31, 2015 and December 31, 2014 and the condensed statements of operations for the three months ended March 31, 2015 and 2014 of Ashford Inc. (in thousands):

Ashford Inc.

Condensed Balance Sheets

	March 31, 2015		December 31, 2014
Total assets	$	48,801	$	49,230
Total liabilities	37,807		33,912
Redeemable noncontrolling interests in Ashford LLC	535		424
Total equity	10,459		14,894
Total liabilities and equity	$	48,801	$	49,230
Our ownership interest in Ashford Inc.	$	4,358	$	7,099

Ashford Inc.

Condensed Statements of Operations

	Three Months Ended March 31,
	2015			2014
Total revenue	$	13,118		$	2,312
Total operating expenses	(21,502		)	(11,110		)
Operating loss	(8,384		)	(8,798		)
Income tax expense	(1,454		)	(15		)
Net loss	(9,838		)	(8,813		)
Loss from consolidated entities attributable to noncontrolling interests	763			—
Net loss attributable to redeemable noncontrolling interests in Ashford LLC	21			—
Net loss attributable to Ashford Inc.	$	(9,054	)	$	(8,813	)
Our equity in loss of Ashford Inc.	$	(2,741	)	$	—

Additionally, as of March 31, 2015 and December 31, 2014, we had a 14.4% subordinated beneficial interest in a trust that holds the Four Seasons hotel property in Nevis, which had a zero carrying value.

18

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

7. Indebtedness

Indebtedness consisted of the following (in thousands):

Indebtedness	Collateral	Maturity	Interest Rate	March 31, 2015		December 31, 2014
Mortgage loan (4)	5 hotels	November 2015	Greater of 6.40% or LIBOR (1) + 6.15%	$	—	$	211,000
Mortgage loan	10 hotels	July 2015	5.22%	—		145,278
Mortgage loan	8 hotels	December 2015	5.70%	92,203		92,772
Mortgage loan	5 hotels	February 2016	5.53%	104,692		105,164
Mortgage loan	5 hotels	February 2016	5.53%	75,207		75,546
Mortgage loan (2)(6)	5 hotels	February 2016	LIBOR (1) + 4.75%	200,000		200,000
Mortgage loan (2)	7 hotels	August 2016	LIBOR (1) + 4.35%	301,000		301,000
Mortgage loan (2)	5 hotels	August 2016	LIBOR (1) + 4.38%	62,900		62,900
Mortgage loan (2)	1 hotel	August 2016	LIBOR (1) + 4.20%	37,500		37,500
Mortgage loan (2)	8 hotels	January 2017	LIBOR (1) + 4.95%	376,800		—
Mortgage loan (5)	24 hotels	April 2017	LIBOR (1) + 4.39%	1,070,560		—
Mortgage loan (2)	1 hotel	April 2017	LIBOR (1) + 4.95%	33,300		—
Mortgage loan	5 hotels	April 2017	5.95%	111,463		111,869
Mortgage loan	5 hotels	April 2017	5.95%	100,188		100,552
Mortgage loan	5 hotels	April 2017	5.95%	152,447		153,002
Mortgage loan	7 hotels	April 2017	5.95%	121,940		122,384
Mortgage loan	1 hotel	January 2018	4.38%	99,343		—
Mortgage loan	2 hotels	January 2018	4.44%	108,646		—
Mortgage loan (3)	1 hotel	July 2019	LIBOR (1) + 3.75%	5,524		5,525
Mortgage loan	1 hotel	November 2020	6.26%	99,509		99,780
Mortgage loan	1 hotel	January 2024	5.49%	10,636		10,673
Mortgage loan	1 hotel	January 2024	5.49%	7,288		7,313
Mortgage loan	1 hotel	May 2024	4.99%	6,819		6,845
Mortgage loan	3 hotels	August 2024	5.20%	67,520		67,520
Mortgage loan	2 hotels	August 2024	4.85%	12,500		12,500
Mortgage loan	3 hotels	August 2024	4.90%	24,980		24,980
Mortgage loan	3 hotels	February 2025	4.45%	54,813		—
Mortgage loan	2 hotels	February 2025	4.45%	24,461		—
Mortgage loan	2 hotels	February 2025	4.45%	21,192		—
				3,383,431		1,954,103
Premiums				4,192		—
Total				$	3,387,623	$	1,954,103

____________________________________

⁽¹⁾ LIBOR rates were 0.176% and 0.171% at March 31, 2015 and December 31, 2014, respectively.

⁽²⁾ This mortgage loan has threeone-year extension options subject to satisfaction of certain conditions.

⁽³⁾ This mortgage loan provides for an interest rate of LIBOR + 3.75% with a 0.25% LIBOR floor for the first 18 months and is fixed at 4.0% thereafter.

⁽⁴⁾ This mortgage loan had threeone-year extension options subject to satisfaction of certain conditions. The first one-year extension period began in November 2014.

⁽⁵⁾ This mortgage loan has four one-year extension options subject to satisfaction of certain conditions.

⁽⁶⁾ This mortgage loan has a LIBOR floor of 0.20%.

On January 2, 2015, we refinanced two mortgage loans totaling $356.3 million. The refinance included our $211.0 million mortgage loan due November 2015 and the $145.3 million mortgage loan due July 2015. The new loans totaled $477.3 million in four loan pools as of March 31, 2015. The new loans include a $376.8 million mortgage loan due January 2017, a $54.8 million mortgage loan due February 2025, a $24.5 million mortgage loan due February 2025 and a $21.2 million mortgage loan due February 2025. The $376.8 million mortgage loan is interest only and provides for a floating interest rate of LIBOR + 4.95%. The stated maturity is January 2017, with three one-year extension options. The three mortgage loans totaling $100.5 million due February 2025 bear interest at a fixed rate of 4.45%. The stated maturity date for each of these loans is February 2025. The new loans continue to be secured by the same 15 hotel properties.

19

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

On March 25, 2015, we completed the financing of a $33.3 million mortgage loan, secured by the Memphis Marriott. The mortgage loan is interest only and provides for a floating interest rate of LIBOR + 4.95%. The stated maturity is April 2017, with three one-year extension options.

During the three months ended March 31, 2015, we recognized premium amortization of $127,000. The amortization of the premium is computed using a method that approximates the effective interest method, which is included in interest expense and amortization of premiums and loan costs in the consolidated statements of operations.

As previously discussed in Note 1, pursuant to the Agreement, we acquired the remaining approximate 28.26% interest in the PIM Highland JV. The transaction closed on March 6, 2015. Subsequent to the close of the transaction, $907.6 million of assumed mortgage loans due March 2015 were refinanced with a $1.07 billion non-recourse mortgage loan due April 2017. The new loan provides for an interest rate of LIBOR plus 4.39%. Additionally we assumed two mortgage loans which include a $99.3 million mortgage due January 2018 with a fixed interest rate of 4.38% and a $108.6 million mortgage loan due January 2018 with a fixed interest rate of 4.44%.

We are required to maintain certain financial ratios under various debt and derivative agreements. If we violate covenants in any debt or derivative agreement, 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. Presently, our existing financial covenants are non-recourse and primarily relate to maintaining minimum debt coverage ratios, maintaining an overall minimum net worth, maintaining a maximum loan to value ratio, and maintaining an overall minimum total assets. As of March 31, 2015, we were in compliance in all material respects with all covenants or other requirements set forth in our debt and related agreements as amended.

8.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.

20

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The following table reconciles the amounts used in calculating basic and diluted income (loss) per share (in thousands, except per share amounts):

	Three Months Ended March 31,
	2015			2014
Net income (loss) allocated to common stockholders:
Net income (loss) attributable to the Company	$	321,496		$	(2,391	)
Less: Dividends on preferred stocks	(8,490		)	(8,490		)
Less: Dividends on common stock	(11,964		)	(9,629		)
Less: Dividends on unvested restricted shares	(165		)	(84		)
Less: Undistributed income from continuing operations allocated to unvested shares	(2,035		)	—
Undistributed income (loss)	298,842			(20,594		)
Add back: Dividends on common stock	11,964			9,629
Distributed and undistributed income (loss) from continuing operations - basic	$	310,806		$	(10,965	)
Add back: Income from continuing operations allocated to operating partnership units	45,336			—
Distributed and undistributed net income (loss) - diluted	$	356,142		$	(10,965	)
Income from discontinued operations allocated to common stockholders:
Income from discontinued operations attributable to the Company	$	—		$	3
Weighted average shares outstanding:
Weighted average common shares outstanding - basic	95,539			81,690
Effect of assumed conversion of operating partnership units	18,373			—
Weighted average shares outstanding - diluted	113,912			81,690
Basic income (loss) per share:
Income (loss) from continuing operations allocated to common stockholders per share	$	3.25		$	(0.13	)
Income from discontinued operations allocated to common stockholders per share	—			—
Net income (loss) allocated to common stockholders per share	$	3.25		$	(0.13	)
Diluted income (loss) per share:
Income (loss) from continuing operations allocated to common stockholders per share	$	3.13		$	(0.13	)
Income from discontinued operations allocated to common stockholders per share	—			—
Net income (loss) allocated to common stockholders per share	$	3.13		$	(0.13	)

Due to the anti-dilutive effect, the computation of diluted income (loss) per share does not reflect adjustments for the following items (in thousands):

	Three Months Ended March 31,
	2015		2014
Net income (loss) allocated to common stockholders is not adjusted for:
Income allocated to unvested restricted shares	$	2,200	$	84
Net income (loss) attributable to noncontrolling interest in operating partnership units	—		(877		)
Total	$	2,200	$	(793	)
Weighted average diluted shares are not adjusted for:
Effect of unvested restricted shares	432		144
Effect of assumed conversion of operating partnership units	—		19,316
Total	432		19,460

21

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

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 as a way to potentially improve cash flows. We also use non-hedge derivatives to capitalize on the historical correlation between changes in LIBOR and RevPAR. The interest rate derivatives currently include interest rate caps. These derivatives are subject to master netting settlement arrangements. As of March 31, 2015, maturities on these instruments range from November 2015 to April 2017. To mitigate the nonperformance risk, we routinely rely on 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.

In 2015, we entered into interest rate caps with notional amounts totaling $1.5 billion and strike rates ranging from 2.50% to 3.00%. These interest rate caps had effective dates from January 2015 to March 2015, and maturity dates from January 2017 to April 2017, for a total cost of $1.3 million. These instruments were not designated as a cash flow hedges. These instruments cap the interest rates on our mortgage loans with principal balances of $1.5 billion and a maturity dates from January 2017 to April 2017.

In 2014, we entered into an interest rate cap with a notional amount and strike rate of $200.0 million and 2.25%, respectively, which had an effective date of January 2014, a maturity date of February 2016 and total cost of $216,000. The instrument was not designated as a cash flow hedge. This instrument caps the interest rate on our mortgage loan with a principal balance of $200.0 million and a maturity date of February 2016.

Credit Default Swap Derivatives—A credit default swap is a derivative contract that functions like an insurance policy against the credit risk of an entity or obligation. The seller of protection assumes the credit risk of the reference obligation from the buyer (us) of protection in exchange for annual premium payments. If a default or a loss, as defined in the credit default swap agreements, occurs on the underlying bonds, then the buyer of protection is protected against those losses. The only liability for us, the buyer, is the annual premium and any change in value of the underlying CMBX index (if the trade is terminated prior to maturity). For all CMBX trades completed to date, we were the buyer of protection. Credit default swaps are subject to master-netting settlement arrangements and credit support annexes. Assuming the underlying bonds pay off at par over their remaining average life, our total exposure for these trades was approximately $1.8 million as of March 31, 2015. Cash collateral is posted by us as well as our counterparty. We offset the fair value of the derivative and the obligation/right to return/reclaim cash collateral. The change in market value of credit default swaps is settled net through posting cash collateral or reclaiming cash collateral between us and our counterparty when the change in market value is over $250,000.

In February 2015 and August 2011, we entered into credit default swap transactions for notional amounts of $45.0 million and $100.0 million, respectively, to hedge financial and capital market risk for upfront costs of $1.6 million and $8.2 million, respectively, that was subsequently returned to us as collateral by our counterparty. The net carrying value of these credit default swaps was an asset of $503,000 and liability of $184,000 as of March 31, 2015 and December 31, 2014, respectively, which are included in “derivative assets, net” and “liabilities associated with marketable securities and other”, respectively, in the consolidated balance sheets. We recognized an unrealized loss of $0.7 million and $226,000 for the three months ended March 31, 2015 and 2014, respectively, which are included in “unrealized loss on derivatives” in the consolidated statements of operations.

Marketable Securities and Liabilities Associated with Marketable Securities and other—We invest in publicly traded equity securities and put and call options on certain publicly traded equity securities, which are considered derivatives. At March 31, 2015, we had investments in these derivatives totaling $1.2 million and liabilities of $1.0 million. At December 31, 2014, we had investments in these derivatives totaling $654,000 and liabilities of $997,000.

22

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

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 market place 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 is obtained from exchange or dealer markets.

• 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.

Fair values of interest rate swaps are determined using the market standard methodology of netting the discounted future fixed cash receipts/payments and the discounted expected variable cash payments/receipts. Fair values of interest rate caps, floors, flooridors, and corridors are determined using the market standard methodology of discounting the future expected cash receipts that would occur if variable interest rates fell 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 swaps, caps, and floors are based on an expectation of future interest rates derived from observable market interest rate curves (LIBOR 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.

Fair values of credit default swaps are obtained from a third party who publishes various information including the index composition and price data (Level 2 inputs). The fair value of credit default swaps does not contain credit-risk-related adjustments as the change in fair value is settled net through posting cash collateral or reclaiming cash collateral between us and our counterparty.

Fair values of marketable securities and liabilities associated with marketable securities, including public equity securities, equity put and call options, and other investments, are based on their quoted market closing prices (Level 1 inputs).

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 March 31, 2015, the LIBOR interest rate forward curve (Level 2 inputs) assumed an uptrend from 0.18% to 1.31% for the remaining term of our derivatives. Credit spreads (Level 3 inputs) used in determining the fair values of hedge and non-hedge designated derivatives assumed an uptrend in nonperformance risk for us and all of our counterparties through the maturity dates.

23

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

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 Market Prices (Level 1)			Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Counterparty and Cash Collateral Netting(4)			Total
March 31, 2015:
Assets
Derivative assets:
Interest rate derivatives - non-hedge	$	—		$	414	$	—	$	—		$	414		(1)
Credit default swaps	—			1,331		—		(828		)	503			(1)
Equity put options	935			—		—		—			935			(2)
Equity call options	267			—		—		—			267			(2)
Non-derivative assets:
Equity	53,155			—		—		—			53,155			(2)
U.S. treasury securities	18,070			—		—		—			18,070			(2)
Total	72,427			1,745		—		(828		)	73,344
Liabilities
Derivative liabilities:
Short equity put options	(353		)	—		—		—			(353		)	(3)
Short equity call options	(694		)	—		—		—			(694		)	(3)
Non-derivative liabilities:
Equity	(1,427		)	—		—		—			(1,427		)	(3)
Margin account balance	(10,297		)	—		—		—			(10,297		)	(3)
Total	(12,771		)	—		—		—			(12,771		)
Net	$	59,656		$	1,745	$	—	$	(828	)	$	60,573
December 31, 2014:
Assets
Derivative assets:
Interest rate derivatives - non-hedge	$	—		$	182	$	—	$	—		$	182		(1)
Equity put options	653			—		—		—			653			(2)
Equity call options	1			—		—		—			1			(2)
Non-derivative assets:
Equity securities	57,941			—		—		—			57,941			(2)
U.S. treasury securities	4,622			—		—		—			4,622			(2)
Total	63,217			182		—		—			63,399
Liabilities
Derivative liabilities:
Credit default swaps	—			379		—		(563		)	(184		)	(3)
Short equity put options	(216		)	—		—		—			(216		)	(3)
Short equity call options	(781		)	—		—		—			(781		)	(3)
Non-derivative liabilities:
Short equity securities	(17		)	—		—		—			(17		)	(3)
Margin account balance	(5,003		)	—		—		—			(5,003		)	(3)
Total	(6,017		)	379		—		(563		)	(6,201		)
Net	$	57,200		$	561	$	—	$	(563	)	$	57,198

____________________________________

⁽¹⁾ Reported net as “derivative assets, net” in the consolidated balance sheets.

⁽²⁾ Reported as “marketable securities” in the consolidated balance sheets.

⁽³⁾ Reported as “liabilities associated with marketable securities and other” in the consolidated balance sheets.

⁽⁴⁾ Represents cash collateral posted by our counterparty.

24

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Effect of Fair-Value-Measured Assets and Liabilities on Consolidated Statements of Operations

The following tables summarize the effect of fair-value-measured assets and liabilities on the consolidated statements of operations for the three months ended March 31, 2015 and 2014 (in thousands):

	Gain (Loss) Recognized in Income								Reclassified from Accumulated OCI  into Interest Expense
	Three Months Ended March 31,								Three Months Ended March 31,
	2015				2014				2015		2014
Assets
Derivative assets:
Interest rate derivatives	$	(1,018	)		$	(121	)		$	—	$	71
Equity put options	(1,290		)		(462		)		—		—
Equity call options	80				(50		)		—		—
Credit default swaps	(737		)		(247		)		—		—
Non-derivative assets:
Equity - American Depositary Receipt	(65		)		—				—		—
Equity	2,063				948				—		—
U.S. Treasury	406				294				—		—
Total	(561		)		362				—		71
Liabilities
Derivative liabilities:
Short equity put options	595				4				—		—
Short equity call options	579				391				—		—
Non-derivative liabilities:
Short equity securities	(36		)		—				—		—
Total	1,138				395				—		—
Net	$	577			$	757			$	—	$	71
Total combined
Interest rate derivatives	$	(1,018	)		$	(121	)		$	—	$	71
Credit default swaps	(680		)		(226		)		—		—
Total derivatives	(1,698		)	(1)	(347		)	(1)	—		71
Unrealized gain (loss) on marketable securities	(1,802		)	(3)	1			(3)	—		—
Realized gain on marketable securities	4,077			(2) (4)	1,103			(2) (4)	—		—
Net	$	577			$	757			$	—	$	71

____________________________________

⁽¹⁾ Reported as “unrealized loss on derivatives” in the consolidated statements of operations.

⁽²⁾ Included in “other income” in the consolidated statements of operations.

⁽³⁾ Reported as “unrealized gain (loss) on marketable securities” in the consolidated statements of operations.

⁽⁴⁾ Includes costs of $57 and $21 for the three months ended March 31, 2015 and 2014, respectively, associated with credit default swaps.

There was no change in fair value of our interest rate derivatives that were recognized in other comprehensive loss for the three months ended March 31, 2014.

25

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

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):

	March 31, 2015				December 31, 2014
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Financial assets and liabilities measured at fair value:
Marketable securities	$	72,427	$	72,427	$	63,217	$	63,217
Derivative assets, net	917		917		182		182
Liabilities associated with marketable securities and other	12,771		12,771		6,201		6,201
Financial assets not measured at fair value:
Cash and cash equivalents	$	355,727	$	355,727	$	215,063	$	215,063
Restricted cash	143,043		143,043		85,830		85,830
Accounts receivable, net	52,512		52,512		22,399		22,399
Note receivable, net	3,599		3,117 to 3,445		3,553		3,049 to 3,370
Due from affiliates	—		—		3,473		3,473
Due from Ashford Prime OP, net	335		335		896		896
Due from related party, net	1,922		1,922		—		—
Due from third-party hotel managers	39,047		39,047		12,241		12,241
Financial liabilities not measured at fair value:
Indebtedness	$	3,387,623	$3,267,372 to $3,611,305		$	1,954,103	$1,905,801 to $2,106,413
Accounts payable and accrued expenses	131,890		131,890		71,118		71,118
Dividends payable	23,346		23,346		21,889		21,889
Due to Ashford Inc., net	9,120		9,120		8,202		8,202
Due to related party, net	—		—		1,867		1,867
Due to third-party hotel managers	1,529		1,529		1,640		1,640

Cash, cash equivalents, and restricted cash. These financial assets bear interest at market rates and have 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, dividends payable, due to/from Ashford Prime OP, due to/from related party, due from affiliates, due to/from Ashford Inc. 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.

Note receivable, net. Fair value of notes receivable is determined using similar loans with similar collateral. We relied on our internal analysis of what we believe a willing buyer would pay for this note. We estimated the fair value of the note receivable to be approximately 13.4% to 4.3% lower than the carrying value of $3.6 million at March 31, 2015 and approximately 14.2% to 5.2% lower than the carrying value of $3.6 million at December 31, 2014. This is considered a Level 2 valuation technique.

Marketable securities. Marketable securities consist of U.S. treasury bills, publicly traded equity securities, and put and call options on certain publicly traded equity securities. The fair value of these investments is based on quoted market closing prices at the balance sheet dates. See Notes 2, 9 and 10 for a complete description of the methodology and assumptions utilized in determining fair values.

26

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Indebtedness. Fair value of indebtedness is determined using future cash flows discounted at current replacement rates for these instruments. Cash flows are determined using a forward interest rate yield curve. Current replacement rates are determined by using the U.S. Treasury yield curve or the index to which these financial instruments are tied and adjusted for credit spreads. Credit spreads take into consideration general market conditions, maturity, and collateral. We estimated the fair value of total indebtedness to be approximately 96.5% to 106.6% of the carrying value of $3.4 billion at March 31, 2015 and approximately 97.5% to 107.8% of the carrying value of $2.0 billion at December 31, 2014. This is considered a Level 2 valuation technique.

Derivative assets and liabilities associated with marketable securities and other. Fair value of interest rate derivatives is determined using the net present value of expected cash flows of each derivative based on the market-based interest rate curve and adjusted for credit spreads of us and our counterparties. Fair values of credit default swap derivatives are obtained from a third party who publishes the CMBX index composition and price data. Liabilities associated with marketable securities and other consists of a margin account balance, short public equity securities and short equity put and call options. Fair value is determined based on quoted market closing prices at the balance sheet dates. See Notes 2, 9 and 10 for a complete description of the methodology and assumptions utilized in determining fair values.

12. 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 (“common units”) and the units issued under our Long-Term Incentive Plan (the “LTIP units”) that are vested throughout the period plus distributions paid to the limited partners with regard to the Class B common units. Class B common units have a fixed dividend rate of 6.82% in years one to three and 7.2% thereafter, and have priority in payment of cash dividends over common units but otherwise have no preference over common units. Aside from the Class B common units, all other outstanding units represent common units. Beginning one year after issuance, each common unit (including each Class B common unit) may be redeemed for either cash or, at our sole discretion, up to one share of our common stock. Beginning ten years after issuance, each Class B common unit may be converted into a common unit at either party’s discretion. As a result of the Ashford Inc. spin-off, holders of our common stock were distributed one share of Ashford Inc. common stock for every 87 shares of our common stock, while our unit holders received one common unit of the operating limited liability company subsidiary of Ashford Inc. for each common unit of our operating partnership the holder held, and such holder then had the opportunity to exchange up to 99% of those units for shares of Ashford Inc. common stock at the rate of one share of Ashford Inc. common stock for every 55 common units. Following the spin-off, Ashford Hospitality Trust, Inc. continues to hold 598,000 shares of Ashford Inc. common stock for the benefit of its common stockholders, and all of our remaining lodging investments are owned by Ashford Trust OP. Therefore, each common unit and LTIP unit was worth approximately 93% and 94% of one share of our common stock at March 31, 2015 and December 31, 2014, respectively.

LTIP units, which are issued to certain executives and employees of Ashford LLC as compensation, have vesting periods ranging from three to five 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, which results from a capital account revaluation, as defined in the partnership agreement, for the operating partnership.

As of March 31, 2015, we have issued a total of 8.7 million LTIP units, all of which, other than approximately 660,000 units, issued in March 2015, have reached full economic parity with, and are convertible into, common units. Expense of $64,000 was recognized for the three months ended March 31, 2015, all of which was associated with LTIP units issued to Ashford LLC’s employees and is included in “advisory services fee” in our consolidated statements of operations. As the LTIP units are issued to non-employees, the compensation expense was determined based on the share price as of the end of the period. Compensation expense of $3.9 million associated with the issuance of LTIP units was recognized for the three months ended March 31, 2014, while we were self-advised. The fair value of the unamortized LTIP units, which was $5.8 million at March 31, 2015, will be amortized over a period of 3.0 years.

During the three months ended March 31, 2015, 150,000 common units with an aggregate fair value of $1.5 million were redeemed by the holder and, at our election, we issued shares of our common stock to satisfy the redemption price. During the three months ended March 31, 2014, no common units were presented for redemption.

27

Redeemable noncontrolling interests, including vested LTIP units, in our operating partnership as of March 31, 2015 and December 31, 2014 were $165.6 million and $177.1 million, respectively, which represents ownership of our operating partnership of 12.38% and 13.01%, respectively. The carrying value of redeemable noncontrolling interests as of March 31, 2015 and December 31, 2014 included adjustments of $115.7 million and $169.3 million, respectively, to reflect the excess of the redemption value over the accumulated historical costs. Redeemable noncontrolling interests were allocated net income of $45.3 million and and net loss of $877,000 for the three months ended March 31, 2015 and 2014, respectively. We declared aggregate cash distributions to holders of common units and holders of LTIP units of $2.7 million for each of the three months ended March 31, 2015 and 2014. These distributions are recorded as a reduction of redeemable noncontrolling interests in operating partnership.

13. Equity and Equity-Based Compensation

Equity Offering—On January 29, 2015, we commenced a follow-on public offering of 9.5 million shares of common stock. The offering priced on January 30, 2015, at $10.65 per share for gross proceeds of $101.2 million. We granted the underwriters a 30-day option to purchase up to an additional 1.425 million shares of common stock. On February 10, 2015, the underwriters partially exercised their option and purchased an additional 1.029 million shares of our common stock at a price of $10.65 per share less the underwriting discount.

Common Stock Dividends—For each of the 2015 and 2014 quarters, the Board of Directors declared quarterly dividends of $0.12 per outstanding share of common stock with an annualized target of $0.48 per share for 2015.

Equity-Based Compensation—Stock-based compensation expense for the three months ended March 31, 2015, was $107,000, which is associated with restricted shares of our common stock issued to Ashford LLC’s employees and is included in “advisory services fee” in our consolidated statements of operations. We recognized compensation expense related to restricted shares of our common stock of $617,000 for the three months ended March 31, 2014, while we were self-advised. The fair value of the unamortized restricted shares, which was $9.6 million at March 31, 2015, will be amortized over a period of 3.0 years.

Preferred Dividends—During the three months ended March 31, 2015, the Board of Directors declared quarterly dividends of $0.5344 per share for our 8.55% Series A preferred stock, $0.5281 per share for our 8.45% Series D preferred stock, and $0.5625 per share for our 9.00% Series E preferred stock. During the three months ended March 31, 2014, the Board of Directors declared quarterly dividends of $0.5344 per share for our 8.55% Series A preferred stock, $0.5281 per share for our 8.45% Series D preferred stock and $0.5625 per share for our 9.00% Series E preferred stock.

Noncontrolling Interests in Consolidated Entities—Our noncontrolling entity partner, had an ownership interest of 15% in two hotel properties and a total carrying value of $775,000 and $800,000 at March 31, 2015 and December 31, 2014, respectively. Our ownership interest is reported in equity in the consolidated balance sheets. Noncontrolling interests in consolidated entities were allocated losses of $25,000 and $27,000 for the three months ended March 31, 2015 and 2014, respectively.

14. Commitments and Contingencies

Restricted Cash—Under certain management and debt agreements for our hotel properties existing at March 31, 2015, 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 3% to 6% of gross revenues for capital improvements.

Franchise Fees—Under franchise agreements for our hotel properties existing at March 31, 2015, we pay franchisor royalty fees between 2.5% and 6% of gross room revenue and, in some cases, food and beverage revenues. Additionally, we pay fees for marketing, reservations, and other related activities aggregating between 1% and 6% of gross room revenue and, in some cases, food and beverage revenues. These franchise agreements expire on varying dates between 2015 and 2035. When a franchise term expires, the franchisor has no obligation to renew the franchise. A franchise termination could have a material adverse effect on the operations or the underlying value of the affected hotel due to loss of associated name recognition, marketing support, and centralized reservation systems provided by the franchisor. A franchise termination could also have a material adverse effect on cash available for distribution to stockholders. 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.

Our continuing operations incurred franchise fees of $11.9 million and $8.9 million for the three months ended March 31, 2015 and 2014, respectively.

28

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Management Fees—Under management agreements for our hotel properties existing at March 31, 2015, we pay a) monthly property management fees equal to the greater of $10,000 (CPI adjusted since 2003) or 3% of gross revenues, or in some cases 1.5% to 7% of gross revenues, as well as annual incentive management fees, if applicable, b) market service fees on approved capital improvements, including project management fees of up to 4% of project costs, for certain hotels, and c) other general fees at current market rates as approved by our independent directors, if required. These management agreements expire from 2015 through 2044, with renewal options. If we terminate a 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.

Income Taxes—If we sell or transfer the Marriott Crystal Gateway in Arlington, Virginia prior to July 2016, we will be required to indemnify the entity from which we acquired the property if, as a result of such transactions, such entity would recognize a gain for federal tax purposes. In general, tax indemnities equal the federal, state, and local income tax liabilities the contributor or their specified assignee incurs with respect to the gain allocated to the contributor. The contribution agreements’ terms generally require us to gross up tax indemnity payments for the amount of income taxes due as a result of such tax indemnities.

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 Lodging, petitioned the employer to withdraw recognition of the union. As a result of the decertification petition, Remington Lodging 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 (“NLRB”) filed a complaint against Remington Lodging seeking, among other things, that Remington Lodging’s withdrawal of recognition was unlawful. Pending the final determination of the NLRB complaint, including appeals, the pension fund entered into a settlement agreement with Remington Lodging on November 1, 2011, providing that (a) Remington Lodging will continue to make monthly pension fund payments pursuant to the collective bargaining agreement, and (b) if the withdrawal of recognition is ultimately deemed lawful, Remington Lodging will have an unfunded pension liability equal to $1.7 million minus the monthly pension payments made by Remington Lodging since the settlement agreement. To illustrate, if Remington Lodging—as of the date a final determination occurs—has made monthly pension payments equaling $100,000, Remington Lodging’s remaining withdrawal liability shall be the unfunded pension liability of $1.7 million minus $100,000 (or $1.6 million). This remaining unfunded pension liability shall be paid to the pension fund in annual installments of $84,000 (but may be made monthly or quarterly, at Remington Lodging’s election), which shall continue for the remainder of the twenty-(20)-year capped period, unless Remington Lodging elects to pay the unfunded pension liability amount earlier. We agreed to indemnify Remington Lodging for the payment of the unfunded pension liability as set forth in the settlement agreement.

Litigation—Palm Beach Florida Hotel and Office Building Limited Partnership, et al. v. Nantucket Enterprises, Inc.This litigation involves a landlord tenant dispute from 2008 in which the landlord, Palm Beach Florida Hotel and Office Building Limited Partnership, a subsidiary of the Company, claimed that the tenant, Nantucket Enterprises, Inc., had violated various lease provisions of the lease agreement and was therefore in default. The tenant counterclaimed and asserted multiple claims including that it had been wrongfully evicted. The litigation was instituted by the plaintiff in November 2008 in the Circuit Court of the Fifteenth Judicial Circuit, in and for Palm Beach County, Florida and proceeded to a jury trial on June 30, 2014. The jury entered its verdict awarding the tenant total claims of $10.8 million and ruling against the landlord on its claim of breach of contract. The landlord is preparing various post trial motions. A final judgment was entered and the landlord has filed a notice of appeal. As a result of the jury verdict, we previously recorded pre-judgment interest of $707,000 and accrued a reasonable estimate of loss related to legal fees of $400,000 during 2014. For the three months ended March 31, 2015, we recorded additional pre-judgment interest of $24,000. Including the 2014 judgment, pre-judgment interest and estimated loss of legal expenses, total expense was $11.9 million through March 31, 2015. The additional charges related to pre-judgment interest are included in other expenses in the consolidated statements of operations for the three months ended March 31, 2015.

We are engaged in other various legal proceedings which have arisen but have not been fully adjudicated. The likelihood of loss from these legal proceedings, based on definitions within contingency accounting literature, ranges from remote to reasonably possible and to probable. Based on estimates of the range of potential losses associated with these matters, management does 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 or results of operations. However, the final results of legal proceedings cannot be predicted with certainty and if we fail to 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 or results of operations could be materially adversely affected in future periods.

29

ASHFORD HOSPITALITY TRUST, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

15. Segment Reporting

We operate in one business segment within the hotel lodging industry: direct hotel investments. Direct hotel investments refer to owning hotels 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 have similar economic characteristics and exhibit similar long-term financial performance. As of March 31, 2015 and December 31, 2014, all of our hotel properties were domestically located.

16. Subsequent Events

On April 17, 2015, we completed the financing of a $25.1 million mortgage loan, secured by the Lakeway Resort in Austin, Texas. The new mortgage loan is interest only and provides for a floating interest rate of LIBOR + 5.10%. The stated maturity is May 2017, with threeone-year extension options.

On April 29, 2015, we completed the acquisition of the 124-room Hampton Inn & Suites in Gainesville, Florida for total consideration of $25.3 million in cash.

The unaudited pro forma results of operations as if the acquisition had occurred on January 1, 2014, is included in Note 3.

30

ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FORWARD-LOOKING STATEMENTS

The following discussion should be read in conjunction with the unaudited financial statements and notes thereto appearing elsewhere herein. This report contains forward-looking statements within the meaning of the federal securities laws. Ashford Hospitality Trust, Inc. (the “Company” or “we” or “our” or “us”) cautions investors that any forward-looking statements presented herein, or which management may express orally or in writing from time to time, are based on management’s beliefs and assumptions at that time.

Throughout this Form 10-Q, 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:

• our business and investment strategy, including our ability to complete proposed business transactions described herein or the expected benefit of any such transactions;

• anticipated or expected purchases or sales of assets;

• our projected operating results;

• completion of any pending transactions;

• our ability to obtain future financing arrangements;

• our understanding of our competition;

• market trends;

• 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. Additionally, the following factors could cause actual results to vary from our forward-looking statements:

• factors discussed in our Form 10-K for the year ended December 31, 2014, as filed with the Securities and Exchange Commission on March 2, 2015, including those set forth under the sections titled “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;

• general and economic business conditions affecting the lodging and travel industry;

• general volatility of the capital markets and the market price of our common and preferred stock;

• changes in our business or investment strategy;

• availability, terms, and deployment of capital;

• availability of qualified personnel to our advisor;

• changes in our industry and the market in which we operate, interest rates, or local economic conditions

• the degree and nature of our competition;

• actual and potential conflicts of interest with our advisor, Remington Lodging & Hospitality, LLC, our executive officers and our non-independent directors;

• changes in governmental regulations, accounting rules, tax rates and similar matters;

• legislative and regulatory changes, including changes to the Internal Revenue Code of 1986, as amended, and related rules, regulations and interpretations governing the taxation of REITs; and

• limitations imposed on our business and our ability to satisfy complex rules in order for us to qualify as a REIT for federal income tax purposes.

When we use words or phrases such as “will likely result,” “may,” “anticipate,” “estimate,” “should,” “expect,” “believe,” “intend,” or similar expressions, we intend to identify forward-looking statements. You should not place undue reliance on these forward-looking statements. We are not obligated to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

31

Overview

We will continue to seek ways to benefit from the cyclical nature of the hotel industry. We believe that in the prior cycle, hotel values and cash flows, for the most part, peaked in 2007, and we believe the hotel industry may exceed these cash flows and values during the next cyclical peak.

Based on our primary business objectives and forecasted operating conditions, our current key priorities and financial strategies include, among other things:

• acquisition of hotel properties that will be accretive to our portfolio;

• disposition of non-core hotel properties;

• investing in securities;

• pursuing capital market activities to enhance long-term stockholder value;

• preserving capital, enhancing liquidity, and continuing current cost-saving measures;

• implementing selective capital improvements designed to increase profitability;

• implementing effective asset management strategies to minimize operating costs and increase revenues;

• financing or refinancing hotels on competitive terms;

• utilizing hedges and derivatives to mitigate risks; and

• making other investments or divestitures that our Board of Directors deems appropriate.

Our current investment strategies focus on the full-service and select-service hotels in the upscale and upper-upscale segments within the lodging industry that have RevPAR generally less than twice the national average. Our Board of Directors has, subject to the closing of the Ashford Hospitality Select, Inc. transaction, modified our investment strategies to focus on full-service hotels in the upscale and upper-upscale segments in domestic and international 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 strategies to take advantage of new lodging-related investment opportunities as they may develop. Our Board of Directors may change our investment strategies at any time without stockholder approval or notice.

Recent Developments

On January 2, 2015, we refinanced two mortgage loans totaling $356.3 million. The refinance included our $211.0 million mortgage loan due November 2015 and our $145.3 million mortgage loan due July 2015. The new loans totaled $477.3 million in four loan pools. The new loans continue to be secured by the same 15 hotel properties.

On January 29, 2015, we commenced a follow-on public offering of 9.5 million shares of common stock. The offering priced on January 30, 2015, at $10.65 per share for gross proceeds of $101.2 million. We granted the underwriters a 30-day option to purchase up to an additional 1.425 million shares of common stock. On February 10, 2015, the underwriters partially exercised their option and purchased an additional 1.029 million shares of our common stock at a price of $10.65 per share less the underwriting discount.

On February 6, 2015, we acquired a 100% interest in the Lakeway Resort for total consideration of $33.5 million. The acquisition was funded with cash.

On February 25, 2015, we acquired a 100% interest in the Memphis Marriott for total consideration of $43.5 million. The acquisition was funded with cash.

On March 11, 2015, we completed the sale of the Hampton Inn in Terre Haute, Indiana for approximately $7.9 million. The sale resulted in a loss of approximately $1.1 million which is included in our continuing operations for the three months ended March 31, 2015.

On March 25, 2015, we completed the financing of a $33.3 million mortgage loan, secured by Memphis Marriott. The mortgage loan is interest only and provides for a floating interest rate of LIBOR + 4.95%. The stated maturity is April 2017, with three one-year extension options.

On March 6, 2015, we acquired the remaining approximate 28.26% interest in the PIM Highland JV for $250.1 million in cash. Subsequent to the close of the transaction, $907.6 million of mortgage loans due March 2015, were refinanced with a $1.07 billion non-recourse mortgage loan due April 2017. The new loan provides for an interest rate of LIBOR plus 4.39%. Additionally we assumed two mortgage loans which include a $99.3 million mortgage due January 2018 with a fixed interest rate of 4.38% and a $108.6 million mortgage loan due January 2018 with a fixed interest rate of 4.44%.

32

On April 17, 2015, we completed the financing of a $25.1 million mortgage loan, secured by the Lakeway Resort in Austin, Texas. The new mortgage loan is interest only and provides for a floating interest rate of LIBOR + 5.10%. The stated maturity is May 2017, with three one-year extension options.

On April 29, 2015, we completed the acquisition of the 124-room Hampton Inn hotel in Gainesville, Florida, for total considerations of $25.3 million in cash.

On January 29, 2015, we announced the formation of Ashford Hospitality Select, Inc. (“Ashford Select”), a new company focused on investing primarily in premium-branded select-service hotels, including extended stay hotels in the U.S. On February 18, 2015, we entered into certain contribution and purchase and sale agreements in anticipation of the imminent launch of Ashford Select. Those agreements contemplated a proposed private placement of Ashford Select Class A common stock, which has not occurred, and the contribution and purchase and sale agreements have been terminated. While we have continued to pursue the launch of this platform, at this time it is uncertain whether we will pursue this strategy with an external capital source or through a wholly owned subsidiary of Ashford Trust.

LIQUIDITY AND CAPITAL RESOURCES

Our cash position from operations is affected primarily by macro industry movements in occupancy and rate 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.

Certain of our loan agreements contain cash trap provisions that may get 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 distributed to us only after certain items are paid, including deposits into ground leasing and maintenance reserves and the payment of debt service, insurance, taxes, operating expenses, and extraordinary capital expenditures and ground leasing expenses. This could affect our liquidity and our ability to make distributions to our stockholders.

Also, we have entered into certain customary guaranty agreements pursuant to which we guaranty payment of any recourse liabilities of our subsidiaries or unconsolidated entities that may result from non-recourse carve-outs, which include, but are not limited to fraud, misrepresentation, willful misconduct resulting in waste, misappropriations of rents following an event of default, voluntary bankruptcy filings, unpermitted transfers of collateral, 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. In connection with the Ashford Prime Spin-off, we are still jointly and severally liable under certain carve-out guarantees and environmental indemnities associated with three loans. Ashford Prime has indemnified us in the case that any of these guarantees are ever called.

In September 2010, we entered into an at-the-market (“ATM”) program with an investment banking firm to offer for sale from time to time up to $50.0 million of our common stock at market prices. No shares have been sold under this ATM program since its inception. While the ATM program will remain in effect until such time that either party elects to terminate or the $50.0 million cap is reached, it is not available until such time that a new prospectus is filed.

In September 2011, we entered into an ATM program with an investment banking firm, pursuant to which we may issue up to 700,000 shares of 8.55% Series A Cumulative Preferred Stock and up to 700,000 shares of 8.45% Series D Cumulative Preferred Stock at market prices up to $30.0 million in total proceeds. While the ATM program remains in effect until such time that either party elects to terminate or the share or dollar thresholds are reached, it is not available until such time that a new prospectus is filed. Through March 31, 2015, we have issued 169,306 shares of 8.55% Series A Cumulative Preferred Stock for gross proceeds of $4.2 million and 501,909 shares of 8.45% Series D Cumulative Preferred Stock for gross proceeds of $12.3 million. During the three months ended March 31, 2015, no shares were issued.

On January 2, 2015, we refinanced two mortgage loans totaling $356.3 million. The refinance included our $211.0 million mortgage loan due November 2015 and our $145.3 million mortgage loan due July 2015. The new loans totaled $477.3 million in four loan pools. The new loans continue to be secured by the same 15 hotel properties.

On January 29, 2015, we commenced a follow-on public offering of 9.5 million shares of common stock. The offering priced on January 30, 2015, at $10.65 per share for gross proceeds of $101.2 million. We granted the underwriters a 30-day option to purchase up to an additional 1.425 million shares of common stock. On February 10, 2015, the underwriters partially exercised their option and purchased an additional 1.029 million shares of our common stock at a price of $10.65 per share less the underwriting discount.

33

On March 25, 2015, we completed the financing of a $33.3 million mortgage loan, secured by the Memphis Marriott. The mortgage loan is interest only and provides for a floating interest rate of LIBOR + 4.95%. The stated maturity is April 2017, with three one-year extension options.

On March 6, 2015, we acquired the remaining approximate 28.26% interest in the PIM Highland JV for $250.1 million in cash. Subsequent to the close of the transaction, $907.6 million of mortgage loans due March 2015, were refinanced with a $1.07 billion non-recourse mortgage loan due April 2017. The new loan provides for an interest rate of LIBOR plus 4.39%. Additionally we assumed two mortgage loans which include a $99.3 million mortgage due January 2018 with a fixed interest rate of 4.38% and a $108.6 million mortgage loan due January 2018 with a fixed interest rate of 4.44%.

On April 17, 2015, we completed the financing of a $25.1 million mortgage loan, secured by the Lakeway Resort in Austin, Texas. The new mortgage loan is interest only and provides for a floating interest rate of LIBOR + 5.10%. The stated maturity is May 2017, with three one-year extension options.

Our principal sources of funds to meet our cash requirements include: cash on hand, positive 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, new investments, debt interest and principal payments and dividends. Items that impacted our cash flow and liquidity during the periods indicated are summarized as follows:

Net Cash Flows Provided by Operating Activities. Net cash flows provided by operating activities, pursuant to our consolidated statements of cash flows, which includes changes in balance sheet items, were $30.3 million and $11.1 million for the three months endedMarch 31, 2015 and 2014, respectively. Cash flows from operations were impacted by changes in hotel operations, the results of the Pier House Resort, which was sold on March 1, 2014 and is included for the periods from January 1, 2014 through February 28, 2014, the operating results of the Lakeway Resort and the Memphis Marriott, which were acquired on February 6, 2015 and February 25, 2015, respectively, the results of the PIM Highland JV, which the remaining 28.26% was acquired on March 6, 2015, the effect of the Ashford Inc. spin-off, that was included in the 2014 results, but not the 2015 results, as well as changes in restricted cash due to the timing of cash deposits for certain loans as well as the timing of collecting receivables from hotel guests, paying vendors, settling with related parties and settling with hotel managers.

Net Cash Flows Provided by (Used in) Investing Activities. For the three months endedMarch 31, 2015, investing activities used net cash flows of $259.1 million, which consisted of cash outflows of $287.6 million primarily attributable the purchase of the Lakeway Resort, Memphis Marriott and the remaining approximate 28.26% interest in the PIM Highland JV hotel properties, $28.8 million for capital improvements made to various hotel properties and $175,000 for franchise fees. These outflows were partially offset by inflows of $49.7 million of reductions in restricted cash for capital expenditures, $7.5 million attributable to cash proceeds received from the sale of the Hampton Inn in Terre Haute, Indiana, $282,000 of proceeds from property insurance and $60,000 of cash payments received on previously impaired mezzanine loans. For the three months endedMarch 31, 2014, investing activities provided net cash flows of $9.4 million, which primarily consisted of cash inflows of $22.4 million attributable to cash proceeds received from the sale of the Pier House Resort, $13.6 million of reimbursements from Ashford Prime related to transaction costs from the Ashford Prime spin-off and $249,000 from Ashford Prime OP, partially offset by $27.0 million for capital improvements made to various hotel properties.

Net Cash Flows Provided by Financing Activities. For the three months endedMarch 31, 2015, net cash flows provided by financing activities were $369.4 million. Cash inflows consisted primarily of $1.6 billion in borrowings on indebtedness and proceeds of $110.9 million from issuance of treasury stock associated with our equity offering. Cash inflows were partially offset by cash outlays primarily consisting of $1.3 billion for repayments of indebtedness, $31.6 million for payments of loan costs and exit fees, $21.9 million for dividend payments to common and preferred stockholders and unit holders, $1.3 million of payments for derivatives and $446,000 for purchase of treasury stock. For the three months endedMarch 31, 2014, net cash flows provided by financing activities were $4.9 million. Cash inflows consisted primarily of $200.0 million in borrowings on indebtedness and $307,000 in proceeds from issuance of treasury stock. Cash inflows were partially offset by cash outlays primarily consisting of $169.5 million for repayments of indebtedness, $20.7 million for dividend payments to common and preferred stockholders and unit holders, $1.0 million for distributions to noncontrolling interests in consolidated entities, $3.8 million for payments of loan costs and exit fees, $231,000 for purchase of treasury stock and $216,000 of payments for derivatives.

We are required to maintain certain financial ratios under various debt and derivative agreements. If we violate covenants in any debt or derivative agreement, 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. Presently, our existing financial debt covenants primarily relate to maintaining minimum net worth and liquidity. As of March 31, 2015, we were in compliance in all material respects with all covenants or other requirements set forth in our debt and related agreements as amended.

34

Mortgage and mezzanine loans are nonrecourse 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, misappropriations 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.

Based on our current level of operations, management believes that our cash flow from operations and our existing cash balances will be adequate to meet upcoming anticipated requirements for interest and principal payments on debt, working capital, and capital expenditures for the next 12 months. With respect to upcoming maturities, we will proactively address our 2015 and 2016 maturities. 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 individual properties.

We are committed to an investment strategy where we will opportunistically pursue hotel-related investments as suitable situations arise. Funds for future hotel-related investments are expected to be derived, in whole or in part, from cash on hand, future borrowings under a credit facility or other loans, or proceeds from additional issuances of common stock, preferred stock, or other securities, asset sales, and joint ventures. However, we have no formal commitment or understanding to invest in additional assets, and there can be no assurance that we will successfully make additional investments. We may, when conditions are suitable, consider additional capital raising opportunities.

Our existing hotels are mostly located in developed areas with competing hotel properties. Future occupancy, average daily room rate (“ADR”), and revenue per available room (“RevPAR”) of any individual hotel could be materially and adversely affected by an increase in the number or quality of competitive hotel properties in its market area. Competition could also affect the quality and quantity of future investment opportunities.

Dividend Policy. During the three month periods ended March 31, 2015 and 2014, the Board of Directors declared quarterly dividends of $0.12 per outstanding share of common stock. In December 2014, the Board of Directors approved our 2015 dividend policy which anticipates a quarterly dividend payment of $0.12 per share for the remainder of 2015. However, the adoption of a dividend policy does not commit our Board of Directors to declare future dividends. The Board of Directors will continue to review our dividend policy on a quarterly basis. We may incur indebtedness to meet distribution requirements imposed on REITs under the Internal Revenue Code to the extent that working capital and cash flow from our investments are insufficient to fund required distributions. Alternatively, we may elect to pay dividends on our common stock in cash or a combination of cash and shares of securities as permitted under federal income tax laws governing REIT distribution requirements. We may pay dividends in excess of our cash flow.

RESULTS OF OPERATIONS

RevPAR is a commonly used measure within the hotel industry to evaluate hotel operations. RevPAR is defined as the product of the ADR charged and the average daily occupancy achieved. RevPAR does not include revenues from food and beverage or parking, telephone, or other guest services 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.

35

The following table summarizes changes in key line items from our consolidated statements of operations (in thousands):

	Three Months Ended March 31,						Favorable/ (Unfavorable) Change
	2015			2014
Total revenue	$	250,235		$	194,861		$	55,374
Total hotel operating expenses	(153,872		)	(120,093		)	(33,779		)
Property taxes, insurance, and other	(11,594		)	(9,589		)	(2,005		)
Depreciation and amortization	(37,864		)	(26,152		)	(11,712		)
Impairment charges	106			101			5
Transaction costs	(499		)	—			(499		)
Advisory services fee	(9,567		)	—			(9,567		)
Corporate, general, and administrative	(4,840		)	(12,735		)	7,895
Operating income	32,105			26,393			5,712
Equity in loss of unconsolidated entities	(6,622		)	(3,498		)	(3,124		)
Interest income	16			6			10
Gain on acquisition of PIM Highland JV	381,835			—			381,835
Other income	4,330			1,277			3,053
Interest expense and amortization of premiums and loan costs	(34,635		)	(28,375		)	(6,260		)
Write-off of loan costs and exit fees	(4,767		)	(2,028		)	(2,739		)
Unrealized gain (loss) on marketable securities	(1,802		)	1			(1,803		)
Unrealized loss on derivatives	(1,698		)	(347		)	(1,351		)
Income tax expense	(825		)	(216		)	(609		)
Income (loss) from continuing operations	367,937			(6,787		)	374,724
Income from discontinued operations	—			4			(4		)
Gain (loss) on sale of hotel properties, net of tax	(1,130		)	3,491			(4,621		)
Net income (loss)	366,807			(3,292		)	370,099
Loss from consolidated entities attributable to noncontrolling interests	25			27			(2		)
Net (income) loss attributable to redeemable noncontrolling interests in operating partnership	(45,336		)	877			(46,213		)
Net income (loss) attributable to the Company	$	321,496		$	(2,388	)	$	323,884

The following table illustrates key performance indicators for our hotel properties included in continuing operations for the three months ended March 31, 2015 and 2014.The operating results of the Pier House Resort, which was sold on March 1, 2014 are included for the periods from January 1, 2014 through February 28, 2014. The operating results of the Lakeway Resort & Spa (“Lakeway Resort”) in Austin, Texas and the Memphis Marriott East hotel (“Memphis Marriott”) in Memphis, Tennessee, which were acquired on February 6, 2015 and February 25, 2015, respectively, are included in continuing operations since their acquisitions. The operating results of the Ashton hotel (“Ashton”) in Fort Worth, Texas and the Fremont Marriott Silicon Valley hotel (“Fremont Marriott”) in Fremont, California, which were acquired on July 18, 2014 and August 6, 2014, respectively, are included in continuing operations for the three months ended March 31, 2015, but not for the three months ended March 31, 2014. The operating results for the PIM Highland JV for the period from January 1, 2014 through March 5, 2015, are included in equity in loss of unconsolidated entities for our ownership percentage. Beginning March 6, 2015, we consolidated the results of operations of these hotels.

	Three Months Ended March 31,
	2015			2014
RevPar (revenue per available room)	$	112.81		$	100.88
Occupancy	77.01		%	74.74		%
ADR (average daily rate)	$	146.48		$	134.97

Comparison of the Three Months Ended March 31, 2015 and 2014

Net income (loss) attributable to the Company. Net income (loss) attributable to the Company increased $323.9 million, from a net loss of $2.4 million to net income of $321.5 million as a result of the factors discussed below.

36

Revenue.Rooms revenue from our hotels increased $44.0 million, or 28.0%, to $201.0 million during the three months ended March 31, 2015 (the “2015 quarter”) compared to the three months ended March 31, 2014 (the “2014 quarter”). We experienced an increase in rooms revenue of $27.8 million as a result of the PIM Highland JV acquisition, $6.8 million associated with the Lakeway Resort, Memphis Marriott, Ashton and Fremont Marriott (“Four Hotel Acquisitions”) that were purchased in February 2015, March 2015, July 2014 and August 2014, respectively, and $12.8 million from our remaining hotel properties and WorldQuest, offset by revenue of $3.4 million from the Pier House Resort that sold in 2014. Food and beverage revenue experienced an increase of $11.3 million, or 40.1%, to $39.6 million. This increase is a result of $8.7 million from the PIM Highland JV acquisition, $2.3 million associated with the Four Hotel Acquisitions and $906,000 from our remaining hotel properties and WorldQuest, offset by revenue of $597,000 from the Pier House Resort that sold in 2014. Other hotel revenue, which consists mainly of Internet access, parking, and spa, experienced an increase of $2.5 million, or 38.7%, to $8.8 million. This increase is a result of $1.1 million from the PIM Highland JV acquisition, $375,000 associated with the Four Hotel Acquisitions and $1.2 million from our remaining hotel properties and WorldQuest, offset by revenue of $247,000 from the Pier House Resort that sold in 2014. For the 2014 quarter, we recorded advisory services revenue of $2.2 million from an agreement between Ashford LLC and Ashford Prime that was in place prior to the spin-off of Ashford, Inc. The advisory services revenue was comprised of a base advisory fee of $2.0 million and reimbursable expenses of $223,000. Other non-hotel revenue decreased $205,000, or 19.2%, to $860,000. The decrease in other non-hotel revenue is primarily attributable to the acquisition of the PIM Highland JV. Prior to the acquisition, we received expense reimbursements related to our managing the day-to-day operations and providing corporate administrative services such as accounting, insurance, marketing support, asset management, and other services.

Hotel Operating Expenses. Hotel operating expenses increased $33.8 million, or 28.1%, to $153.9 million. Hotel operating expenses consist of direct expenses from departments associated with revenue streams and indirect expenses associated with support departments and management fees. We experienced increases of $16.0 million in direct expenses and $17.8 million in indirect expenses and management fees in the 2015 quarter, which were primarily attributable to increases in direct expenses and indirect expenses and management fees of $11.3 million and $11.8 million, respectively as a result of the PIM Highland JV acquisition. The increases from our remaining hotel properties and WorldQuest are attributable to higher hotel revenues at those properties. Direct expenses were 29.6% and 30.1% of total hotel revenue for the 2015 quarter and the 2014 quarter, respectively.

Property Taxes, Insurance, and Other. Property taxes, insurance, and other increased $2.0 million, or 20.9%, to $11.6 million. The increase was primarily due to $1.7 million of property taxes, insurance, and other associated with the PIM Highland JV acquisition, $443,000 associated with the Four Hotel Acquisitions and $179,000 from our remaining hotel properties and WorldQuest. This increase was partially offset by $297,000 for the Pier House Resort that sold in 2014.

Depreciation and Amortization. Depreciation and amortization increased $11.7 million, or 44.8%, to $37.9 million. The increase was primarily due to $7.0 million of depreciation and amortization associated with the PIM Highland JV acquisition and $1.5 million associated with the Four Hotel Acquisitions. The remaining increase of $3.5 million is attributable to capital expenditures that have occurred since March 31, 2014 and the Four Hotel Acquisitions and lower depreciation of $344,000 as a result of the sale of the Pier House Resort.

Impairment Charges. We recorded credits to impairment charges of $106,000 and $101,000 for the 2015 quarter and 2014 quarter, respectively, for cash received and resulting valuation adjustments on a previously impaired mezzanine loan.

Transaction Costs. Transaction costs were $499,000 in the 2015 quarter. The increase is primarily attributable to costs related to the acquisitions of the remaining interest in PIM Highland JV, the Lakeway Resort and the Memphis Marriott.

Advisory Services Fee. Advisory services fees represent fees paid in connection with the advisory agreement between Ashford Inc. and us for the 2015 quarter. For the 2015 quarter, we recorded an advisory services fee of $9.6 million, which comprised of a base advisory fee of $8.0 million, reimbursable overhead and internal audit, insurance claims advisory and asset management services of $1.4 million and equity-based compensation of $171,000 associated with equity grants of our common stock and LTIP units awarded to the officers and employees of Ashford Inc. For the 2014 quarter, we did not recognize an advisory services fee as we were self-advised.

Corporate, General, and Administrative. Corporate, general, and administrative expenses decreased $7.9 million, or 62.0%, to $4.8 million. Other general and administrative expenses decreased $3.4 million and non-cash equity-based compensation decreased $4.5 million for the 2015 quarter. The decrease in other general and administrative expenses was primarily attributable to salaries and benefits of $5.9 million associated with the Ashford Inc. spin-off, as such expenses are no longer recognized with all employees moving to Ashford Inc. Additionally, non-cash equity-based compensation decreased $4.5 million as a result of the Ashford Inc. spin-off. The remaining decrease is primarily attributable to lower office expenses, professional fees and other miscellaneous expenses totaling approximately $773,000. These decreases were partially offset by $2.7 million of costs associated with Ashford Select and $590,000 of expense associated with the spin-off of Ashford Inc.

37

Equity in Loss of Unconsolidated Entities. We recorded equity in loss of unconsolidated entities of $6.6 million and $3.5 million for the 2015 quarter and the 2014 quarter, respectively. The 2015 quarter includes equity in loss in Ashford Inc. of $2.7 million, Ashford Prime of $45,000 and $3.8 million in PIM Highland JV. The 2014 quarter includes equity in earnings in Ashford Prime of $744,000 and $2.8 million in PIM Highland JV.

Interest Income. Interest income was $16,000 and $6,000 for the 2015 quarter and the 2014 quarter, respectively.

Gain on Acquisition of PIM Highland JV. Gain on acquisition of PIM Highland JV was $381.8 million for the 2015 quarter. This gain is related to the acquisition of the remaining interest in the PIM Highland JV in March 2015. No gain was recorded in the 2014 quarter.

Other Income. Other income increased $3.1 million, or 239.1%, to $4.3 million. The increase in other income is primarily attributable to realized gain on marketable securities of $4.1 million and dividend income of $165,000 for the 2015 quarter compared to a realized gain on marketable securities of $1.1 million and dividend income of $172,000 for the 2014 quarter.

Interest Expense and Amortization of Premiums and Loan Costs. Interest expense and amortization of premiums and loan costs increased $6.3 million, or 22.1%, to $34.6 million. The increase is primarily due to $4.9 million of interest expense and amortization associated with the PIM Highland JV acquisition and refinance. The remaining increase is associated with higher loan cost amortization and interest expense as a result of new financings on the majority of the Four Hotel Acquisitions of $625,000 and higher loan cost amortization and interest expense as a result of refinances on our remaining hotel properties of $779,000. These expenses were offset slightly as a result of the sale of the Pier House Resort. The average LIBOR rates for the 2015 quarter and the 2014 quarter were 0.17% and 0.16%, respectively.

Write-off of Loan Costs and Exit Fees. Write-off of loan costs and exit fees increased $2.7 million, or 135.1%, to $4.8 million. The increase is primarily attributable to three mortgage loans we refinanced and one hotel property in which we obtained new financing, See Note 7. For the 2015 quarter, we wrote-off the unamortized loan costs of $86,000, incurred defeasance and other exit fees of $4.7 million. For the 2014 quarter, we sold the Pier House Resort in which we wrote-off unamortized loan costs of $1.4 million and had one mortgage loan refinanced in which we wrote-off the unamortized loan costs of $251,000 and incurred exit fees of $396,000.

Unrealized Gain (Loss) on Marketable Securities. Unrealized loss on marketable securities of $1.8 million and unrealized gain on marketable securities of $1,000 for the 2015 quarter and the 2014 quarter, respectively, are based on changes in closing market prices during the quarter.

Unrealized Loss on Derivatives. Unrealized loss on derivatives increased $1.4 million, or 389.3%, to $1.7 million. The 2015 quarter had losses consisting of $1.0 million and $680,000 related to interest rate derivatives and credit default swaps, respectively. In the 2014 quarter, we had losses consisting of $121,000 and $226,000 related to interest rate derivatives and credit default swaps, respectively. The fair value of interest rate derivatives is primarily based on movements in the LIBOR forward curve and the passage of time. The fair value of credit default swaps is based on the change in value of CMBX indices.

Income Tax Expense. Income tax expense increased $609,000, or 281.9%, to $825,000. The increase in income tax expense is primarily due to the acquisition of the approximate 28.26% interest in the PIM Highland JV. Prior to the acquisition, the PIM Highland JV was accounted for under the equity method. After the acquisition, the PIM Highland JV became wholly-owned and income tax expense for its TRS is now included in consolidated income tax expense.

Income from Discontinued Operations. Income from discontinued operations was $4,000 for the 2014 quarter related to the sale of the Homewood Suites Mobile hotel in Mobile, Alabama in November 2014.

Gain (loss) on Sale of Hotel Properties, net of tax. Gain (loss) on sale of hotel properties, net of tax, was a loss of $1.1 million and a gain of $3.5 million for the 2015 quarter and the 2014 quarter, respectively. In the 2015 quarter, we recognized a loss of $1.1 million on the sale of the Hampton Inn in Terre Haute, Indiana. In the 2014 quarter, we recognized a gain of $3.5 million in connection with the sale of the Pier House Resort to Ashford Prime. We deferred a portion of the gain of the Pier House Resort in the amount of $599,000, in accordance with the applicable accounting guidance, as a result of our equity investment in Ashford Prime OP.

Loss from Consolidated Entities Attributable to Noncontrolling Interests. Noncontrolling interest partners in consolidated entities were allocated losses of $25,000 and $27,000 for the 2015 quarter and the 2014 quarter, respectively.

Net (Income) Loss Attributable to Redeemable Noncontrolling Interests in Operating Partnership. Noncontrolling interests in operating partnership were allocated net income of $45.3 million and net loss of $877,000 in the 2015 quarter and the 2014 quarter, respectively. Redeemable noncontrolling interests represented ownership interests of 12.38% and 12.91% in the operating partnership at March 31, 2015 and 2014, respectively.

38

SEASONALITY

Our properties’ operations historically have been seasonal as certain properties maintain higher occupancy rates during the summer months and some during the winter months. This seasonality pattern can cause fluctuations in our quarterly lease revenue under our percentage leases. We anticipate that our cash flows from the operations of our properties will be sufficient to enable us to make quarterly distributions to maintain our REIT status. To the extent that cash flows from operations are insufficient during any quarter due to temporary or seasonal fluctuations in lease revenue, we expect to utilize other cash on hand or borrowings to fund required distributions. However, we cannot make any assurances that we will make distributions in the future.

OFF-BALANCE SHEET ARRANGEMENTS

In the normal course of business, we form partnerships or joint ventures that operate certain hotels. We evaluate each partnership and joint venture to determine whether the entity is a VIE. If the entity is determined to be a VIE, we assess whether we are the primary beneficiary and need to consolidate the entity. For further discussion of the company’s VIEs, see Notes 2 and 6 to the consolidated financial statements.

CONTRACTUAL OBLIGATIONS

There have been no material changes since December 31, 2014, outside of the ordinary course of business, to contractual obligations specified in the table of contractual obligations included in the section “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our 2014 Form 10-K.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Our accounting policies that are critical or most important to understanding our financial condition and results of operations and that require management to make the most difficult judgments are described in our 2014 Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 2, 2015. There have been no material changes in these critical accounting policies.

NON-GAAP FINANCIAL MEASURES

The following non-GAAP presentations of EBITDA, Adjusted EBITDA, Funds From Operations (“FFO”) and Adjusted FFO (“AFFO”) are made to assist our investors evaluate our operating performance.

EBITDA is defined as net loss attributable to the Company before interest expense and amortization of premiums and loan costs, interest income other than interest income from mezzanine loans, income taxes, depreciation and amortization, and noncontrolling interests in the operating partnership and after adjustments for unconsolidated joint ventures. We adjust EBITDA to exclude certain additional items such as gains on hotel properties, impairment charges, write-off of loan costs and exit fees, other income, transaction, acquisition and management conversion costs, transaction costs related to spin-offs, legal judgments, dead deal costs and non-cash items such as amortization of unfavorable management contract liabilities, equity-based compensation, unrealized gains and losses on marketable securities and derivative instruments, as well as the Company’s portion of adjustments to EBITDA of unconsolidated entities. We exclude items from Adjusted EBITDA that are either non-cash or are not part of our core operations in order to provide a period-over-period comparison of our operations. We present EBITDA and Adjusted EBITDA because we believe these measurements a) more accurately reflect the ongoing performance of our hotel assets and other investments, b) provide more useful information to investors as indicators of our ability to meet our future debt payment and working capital requirements, and c) provide an overall evaluation of our financial condition. EBITDA and Adjusted EBITDA as calculated by us may not be comparable to EBITDA and Adjusted EBITDA reported by other companies that do not define EBITDA and Adjusted EBITDA exactly as we define the terms. EBITDA and Adjusted EBITDA do not represent cash generated from operating activities determined in accordance with GAAP and should 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.

39

The following table reconciles net income (loss) to EBITDA and Adjusted EBITDA (in thousands):

	Three Months Ended March 31,
	2015			2014
Net income (loss)	$	366,807		$	(3,292	)
Loss from consolidated entities attributable to noncontrolling interest	25			27
Net (income) loss attributable to redeemable noncontrolling interests in operating partnership	(45,336		)	877
Net income (loss) attributable to the Company	321,496			(2,388		)
Interest income	(16		)	(6		)
Interest expense and amortization of premiums and loan costs	34,606			28,491
Depreciation and amortization	37,820			26,191
Income tax expense	825			228
Net income (loss) attributable to redeemable noncontrolling interests in operating partnership	45,336			(877		)
Equity in loss of unconsolidated entities	6,622			3,498
Company's portion of EBITDA of unconsolidated entities (Ashford Inc.)	(2,278		)	—
Company's portion of EBITDA of unconsolidated entities (Ashford Prime OP)	2,910			2,534
Company's portion of EBITDA of unconsolidated entities (PIM Highland JV)	11,982			20,575
EBITDA	459,303			78,246
Amortization of unfavorable management contract liabilities	(494		)	(494		)
Impairment charges	(106		)	(101		)
Gain on hotel properties	(380,705		)	(3,503		)
Write-off of loan costs and exit fees	4,767			2,028
Other income (1)	(4,330		)	(1,277		)
Transaction, acquisition and management conversion costs	499			—
Transaction costs related to spin-offs	3,425			—
Legal judgment	24			—
Unrealized (gain) loss on marketable securities	1,802			(1		)
Unrealized loss on derivatives	1,698			347
Dead deal costs	55			—
Equity-based compensation	171			4,488
Company's portion of adjustments to EBITDA of unconsolidated entities (Ashford Inc.)	3,324			—
Company's portion of adjustments to EBITDA of unconsolidated entities (Ashford Prime OP)	(82		)	314
Company's portion of adjustments to EBITDA of unconsolidated entities (PIM Highland JV)	—			(506		)
Adjusted EBITDA	$	89,351		$	79,541

____________________________________

⁽¹⁾  Other income, primarily consisting of income from realized gain/loss on marketable securities, is excluded from Adjusted EBITDA.

40

We calculate FFO and AFFO in the following table. FFO is calculated on the basis defined by NAREIT, which is net loss attributable to common stockholders, computed in accordance with GAAP, excluding gains or losses on properties, and extraordinary items as defined by GAAP, plus depreciation and amortization of real estate assets, and after adjustments for unconsolidated entities and noncontrolling interests in the operating partnership. Adjustments for unconsolidated entities are calculated to reflect FFO on the same basis. NAREIT developed FFO as a relative measure of performance of an equity REIT to recognize that income-producing real estate historically has not depreciated on the basis determined by GAAP. Our calculation of AFFO excludes write-off of loan costs and exit fees, impairment charges, other income, transaction, acquisition and management conversion costs, transaction costs related to spin-offs, legal judgments, dead deal costs and non-cash items such as gains and losses on marketable securities and derivative instruments as well as our portion of adjustments to FFO related to unconsolidated entities. We exclude items from AFFO that are either non-cash or are not part of our core operations in order to provide a period-over-period comparison of our operating results. We consider FFO and AFFO 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 reported by other REITs that either do not define the term in accordance with the current NAREIT definition or interpret the NAREIT definition differently than us. FFO and AFFO do not represent cash generated from operating activities as determined by GAAP and should 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 our ability to make cash distributions. However, to facilitate a clear understanding of our historical operating results, we believe that FFO and AFFO should be considered along with our net income or loss and cash flows reported in the consolidated financial statements.

The following table reconciles net income (loss) to FFO and Adjusted FFO available to common stockholders (in thousands):

	Three Months Ended March 31,
	2015			2014
Net income (loss)	$	366,807		$	(3,292	)
Loss from consolidated entities attributable to noncontrolling interest	25			27
Net (income) loss attributable to redeemable noncontrolling interests in operating partnership	(45,336		)	877
Preferred dividends	(8,490		)	(8,490		)
Net income (loss) attributable to common stockholders	313,006			(10,878		)
Depreciation and amortization of real estate	37,820			26,105
Gain on hotel properties	(380,705		)	(3,503		)
Net income (loss) attributable to redeemable noncontrolling interests in operating partnership	45,336			(877		)
Equity in loss of unconsolidated entities	6,622			3,498
Company's portion of FFO of unconsolidated entities (Ashford Inc.)	(2,747		)	—
Company's portion of FFO of unconsolidated entities (Ashford Prime OP)	1,452			785
Company's portion of FFO of unconsolidated entities (PIM Highland JV)	3,791			8,851
FFO available to common stockholders	24,575			23,981
Write-off of loan costs and exit fees	4,767			2,028
Impairment charges	(106		)	(101		)
Transaction, acquisition and management conversion costs	499			—
Transaction costs related to spin-offs	3,425			—
Other income (1)	(4,330		)	(1,277		)
Legal judgment	24			—
Unrealized (gain) loss on marketable securities	1,802			(1		)
Unrealized loss on derivatives	1,698			347
Dead deal costs	55			—
Company's portion of adjustments to FFO of unconsolidated entities (Ashford Inc.)	1,744			—
Company's portion of adjustments to FFO of unconsolidated entities (Ashford Prime OP)	(148		)	321
Company's portion of adjustments to FFO of unconsolidated entities (PIM Highland JV)	—			(506		)
Adjusted FFO available to common stockholders	$	34,005		$	24,792

____________________________________

⁽¹⁾ Other income, primarily consisting of net realized gain/loss on marketable securities, is excluded from Adjusted FFO.

41

HOTEL PORTFOLIO

The following table presents certain information related to our hotel properties as of March 31, 2015:

Hotel Property	Location	Service Type	Total Rooms	% Owned		Owned Rooms
Fee Simple Properties
Embassy Suites	Austin, TX	Full service	150	100	%	150
Embassy Suites	Dallas, TX	Full service	150	100		150
Embassy Suites	Herndon, VA	Full service	150	100		150
Embassy Suites	Las Vegas, NV	Full service	220	100		220
Embassy Suites	Syracuse, NY	Full service	215	100		215
Embassy Suites	Flagstaff, AZ	Full service	119	100		119
Embassy Suites	Houston, TX	Full service	150	100		150
Embassy Suites	West Palm Beach, FL	Full service	160	100		160
Embassy Suites	Philadelphia, PA	Full service	263	100		263
Embassy Suites	Walnut Creek, CA	Full service	249	100		249
Embassy Suites	Arlington, VA	Full service	267	100		267
Embassy Suites	Portland, OR	Full service	276	100		276
Embassy Suites	Santa Clara, CA	Full service	257	100		257
Embassy Suites	Orlando, FL	Full service	174	100		174
Hilton Garden Inn	Jacksonville, FL	Select service	119	100		119
Hilton Garden Inn	Austin, TX	Select service	254	100		254
Hilton Garden Inn	Baltimore, MD	Select service	158	100		158
Hilton Garden Inn	Virginia Beach, VA	Select service	176	100		176
Hilton	Houston, TX	Full service	242	100		242
Hilton	St. Petersburg, FL	Full service	333	100		333
Hilton	Santa Fe, NM	Full service	158	100		158
Hilton	Bloomington, MN	Full service	300	100		300
Hilton	Costa Mesa, CA	Full service	486	100		486
Hilton	Boston, MA	Full service	390	100		390
Hilton	Parssippany, NJ	Full service	353	100		353
Hilton	Tampa, FL	Full service	238	100		238
Hampton Inn	Lawrenceville, GA	Select service	85	100		85
Hampton Inn	Evansville, IN	Select service	140	100		140
Hampton Inn	Parssippany, NJ	Select service	152	100		152
Hampton Inn	Buford, GA	Select service	92	100		92
Marriott	Durham, NC	Full service	225	100		225
Marriott	Arlington, VA	Full service	697	100		697
Marriott	Bridgewater, NJ	Full service	347	100		347
Marriott	Dallas, TX	Full service	265	100		265
Marriott	Fremont, CA	Full service	357	100		357
Marriott	Memphis, TN	Full service	232	100		232
Marriott	Irving, TX	Full service	491	100		491
Marriott	Omaha, NE	Full service	300	100		300
Marriott	San Antonio, TX	Full service	251	100		251
SpringHill Suites by Marriott	Jacksonville, FL	Select service	102	100		102
SpringHill Suites by Marriott	Baltimore, MD	Select service	133	100		133
SpringHill Suites by Marriott	Kennesaw, GA	Select service	90	100		90
SpringHill Suites by Marriott	Buford, GA	Select service	97	100		97
SpringHill Suites by Marriott	Gaithersburg, MD	Select service	162	100		162

42

Hotel Property	Location	Service Type	Total Rooms	% Owned	Owned Rooms
SpringHill Suites by Marriott	Centreville, VA	Select service	136	100	136
SpringHill Suites by Marriott	Charlotte, NC	Select service	136	100	136
SpringHill Suites by Marriott	Durham, NC	Select service	120	100	120
SpringHill Suites by Marriott	Orlando, FL	Select service	400	100	400
SpringHill Suites by Marriott	Manhattan Beach, CA	Select service	164	100	164
SpringHill Suites by Marriott	Plymouth Meeting, PA	Select service	199	100	199
SpringHill Suites by Marriott	Glen Allen, VA	Select service	136	100	136
Fairfield Inn by Marriott	Kennesaw, GA	Select service	86	100	86
Fairfield Inn by Marriott	Orlando, FL	Select service	388	100	388
Courtyard by Marriott	Bloomington, IN	Select service	117	100	117
Courtyard by Marriott	Boston, MA	Select service	315	100	315
Courtyard by Marriott	Columbus, IN	Select service	90	100	90
Courtyard by Marriott	Denver, CO	Select service	202	100	202
Courtyard by Marriott	Louisville, KY	Select service	150	100	150
Courtyard by Marriott	Gaithersburg, MD	Select service	210	100	210
Courtyard by Marriott	Crystal City, VA	Select service	272	100	272
Courtyard by Marriott	Ft. Lauderdale, FL	Select service	174	100	174
Courtyard by Marriott	Overland Park, KS	Select service	168	100	168
Courtyard by Marriott	Palm Desert, CA	Select service	151	100	151
Courtyard by Marriott	Savannah, GA	Select service	156	100	156
Courtyard by Marriott	Foothill Ranch, CA	Select service	156	100	156
Courtyard by Marriott	Alpharetta, GA	Select service	154	100	154
Courtyard by Marriott	Orlando, FL	Select service	312	100	312
Courtyard by Marriott	Oakland, CA	Select service	156	100	156
Courtyard by Marriott	Scottsdale, AZ	Select service	180	100	180
Courtyard by Marriott	Plano, TX	Select service	153	100	153
Courtyard by Marriott	Edison, NJ	Select service	146	100	146
Courtyard by Marriott	Newark, CA	Select service	181	100	181
Courtyard by Marriott	Manchester, CT	Select service	90	85	77
Courtyard by Marriott	Basking Ridge, NJ	Select service	235	100	235
Marriott Residence Inn	Lake Buena Vista, FL	Select service	210	100	210
Marriott Residence Inn	Evansville, IN	Select service	78	100	78
Marriott Residence Inn	Orlando, FL	Select service	350	100	350
Marriott Residence Inn	Falls Church, VA	Select service	159	100	159
Marriott Residence Inn	San Diego, CA	Select service	150	100	150
Marriott Residence Inn	Salt Lake City, UT	Select service	144	100	144
Marriott Residence Inn	Palm Desert, CA	Select service	130	100	130
Marriott Residence Inn	Las Vegas, NV	Select service	256	100	256
Marriott Residence Inn	Phoenix, AZ	Select service	200	100	200
Marriott Residence Inn	Plano, TX	Select service	126	100	126
Marriott Residence Inn	Newark, CA	Select service	168	100	168
Marriott Residence Inn	Manchester, CT	Select service	96	85	82
Marriott Residence Inn	Atlanta, GA	Select service	150	100	150
Marriott Residence Inn	Jacksonville, FL	Select service	120	100	120
TownePlace Suites by Marriott	Manhattan Beach, CA	Select service	144	100	144
Renaissance	Tampa, FL	Full service	109	100	109
Ritz-Carlton	Atlanta, GA	Full service	444	100	444
One Ocean	Atlantic Beach, FL	Full service	193	100	193

43

Hotel Property	Location	Service Type	Total Rooms	% Owned		Owned Rooms
Sheraton Hotel	Langhorne, PA	Full service	186	100		186
Sheraton Hotel	Minneapolis, MN	Full service	220	100		220
Sheraton Hotel	Indianapolis, IN	Full service	378	100		378
Sheraton Hotel	Anchorage, AK	Full service	370	100		370
Sheraton Hotel	San Diego, CA	Full service	260	100		260
Hyatt Regency	Coral Gables, FL	Full service	250	100		250
Hyatt Regency	Hauppauge, NY	Full service	358	100		358
Hyatt Regency	Savannah, GA	Full service	351	100		351
Crowne Plaza	Beverly Hills, CA	Full service	260	100		260
Crowne Plaza	Atlanta, GA	Full service	495	100		495
Annapolis Historic Inn	Annapolis, MD	Full service	124	100		124
Lakeway Resort & Spa	Austin, TX	Full service	168	100		168
Silversmith	Chicago, IL	Full service	144	100		144
The Churchill	Washington, DC	Full service	173	100		173
The Melrose	Washington, DC	Full service	240	100		240
The Ashton	Ft. Worth, TX	Select service	39	100		39
Ground Lease Properties
Crown Plaza	Key West, FL	Full service	160	100	%	160
Hilton	Ft. Worth, TX	Full service	294	100		294
Marriott	Houston, TX	Full service	300	100		300
Renaissance	Nashville, TN	Full service	673	100		673
Renaissance	Palm Springs, CA	Full service	410	100		410
Renaissance	Portsmouth, VA	Full service	249	100		249
Sheraton Hotel	Annapolis, MD	Full service	196	100		196
Westin	Princeton, NJ	Full service	296	100		296
Total			25,579			25,552

44

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

Our primary market risk exposure consists of changes in interest rates on borrowings under our debt instruments and our derivatives portfolio that bear interest at variable rates that fluctuate with market interest rates. The analysis below presents the sensitivity of the market value of our financial instruments to selected changes in market interest rates. We acquired the remaining approximate 28.26% interest in the 28 hotels of the PIM Highland JV, which had a material impact to the analysis below since December 31, 2014.

At March 31, 2015, our total indebtedness of $3.4 billion included $2.1 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 March 31, 2015 would be approximately $5.2 million annually. Interest rate changes have no impact on the remaining $1.3 billion of fixed-rate debt. At December 31, 2014, the total consolidated indebtedness of $2.0 billion included $817.9 million of variable-rate debt. The impact on the results of operations of a 25-basis point change in interest rate on the outstanding balance of variable-rate debt at December 31, 2014 would be approximately $2.0 million per year. Interest rate changes will have no impact on the remaining $1.2 billion 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 at March 31, 2015 and December 31, 2014, respectively, 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 at the time, and the related interest rates.

In February 2015 and August 2011, we entered into credit default swap transactions for notional amounts of $45.0 million and $100.0 million, respectively, to hedge financial and capital market risk for upfront costs of $1.6 million and $8.2 million, respectively, which amounts were subsequently returned to us as collateral by our counterparty. A credit default swap is a derivative contract that functions like an insurance policy against the credit risk of an entity or obligation. The seller of protection assumes the credit risk of the reference obligation from the buyer (us) of protection in exchange for annual premium payments. If a default or a loss, as defined in the credit default swap agreements, occurs on the underlying bonds, then the buyer of protection is protected against those losses. The only liability for us, the buyer, is the annual premium and any change in value of the underlying CMBX index (if the trade is terminated prior to maturity). For all CMBX trades completed to date, we were the buyer of protection. Credit default swaps are subject to master-netting settlement arrangements and credit support annexes. Assuming the underlying bonds pay off at par over their remaining average life, our total exposure for these trades was approximately $1.8 million at March 31, 2015.

ITEM 4. 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 Securities Exchange Act of 1934 (the “Exchange Act”)) as of March 31, 2015 (“Evaluation Date”). Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of the Evaluation Date, our disclosure controls and procedures are 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 Securities and Exchange Commission 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.

There have been no changes in our internal controls over financial reporting during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

45

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Litigation—Palm Beach Florida Hotel and Office Building Limited Partnership, et al. v. Nantucket Enterprises, Inc.This litigation involves a landlord tenant dispute from 2008 in which the landlord, Palm Beach Florida Hotel and Office Building Limited Partnership, a subsidiary of the Company, claimed that the tenant, Nantucket Enterprises, Inc., had violated various lease provisions of the lease agreement and was therefore in default. The tenant counterclaimed and asserted multiple claims including that it had been wrongfully evicted. The litigation was instituted by the plaintiff in November 2008 in the Circuit Court of the Fifteenth Judicial Circuit, in and for Palm Beach County, Florida and proceeded to a jury trial on June 30, 2014. The jury entered its verdict awarding the tenant total claims of $10.8 million and ruling against the landlord on its claim of breach of contract. The landlord is preparing various post trial motions. A final judgment was entered and the landlord has filed a notice of appeal. As a result of the jury verdict, we previously recorded pre-judgment interest of $707,000 and accrued a reasonable estimate of loss related to legal fees of $400,000 during 2014. As of the three months ended March 31, 2015, we recorded additional pre-judgment interest of $24,000. Including the 2014 judgment, pre-judgment interest and estimated loss of legal expenses, total expense was $11.9 million through March 31, 2015. The additional charges related to pre-judgment interest are included in other expenses in the consolidated statements of operations for the three months ended March 31, 2015.

We are engaged in other various legal proceedings which have arisen but have not been fully adjudicated. The likelihood of loss from these legal proceedings, based on definitions within contingency accounting literature, ranges from remote to reasonably possible and to probable. Based on estimates of the range of potential losses associated with these matters, management does 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 or results of operations. However, the final results of legal proceedings cannot be predicted with certainty and if we fail to 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 or results of operations could be materially adversely affected in future periods.

ITEM 1A. RISK FACTORS

The discussion of our business and operations and risk factors discussed in this report should be read together with the risk factors contained in Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2014, which describe various risks and uncertainties to which we are or may become subject. These risks and uncertainties have the potential to affect our business, financial condition, results of operations, cash flows, strategies, or prospects in a material and adverse manner.

Any business combinations, including those contemplated by the Ashford Select contribution and purchase and sale agreements, are subject to substantial risks that could adversely affect our financial condition and results of operations and reduce our ability to make distributions to our stockholders.

Any business combinations, including those contemplated by the Ashford Select contribution and purchase and sale agreements, involve potential risks, including, among other things:

• the validity of our assumptions about revenues, capital expenditures and operating costs of the acquired or contributed business or assets, as well as assumptions about achieving synergies with our existing business;

• the validity of our assessment of environmental and other liabilities;

• the costs associated with additional debt or equity capital, which may result in a significant increase in our interest expense and financial leverage resulting from any additional debt incurred to finance the business combination, or the issuance of additional shares on which we will make distributions, either of which could exacerbated by volatility in the equity or debt capital markets;

• a failure to realize anticipated benefits, such as enhanced competitive position, revised investment guidelines or new customer relationships;

• a decrease in our liquidity as a result of financing the business combination; and

• the incurrence of other significant charges, such as impairment of goodwill or other intangible assets, asset devaluation or restructuring charges.

46

The launch of the Ashford Select platform may not be completed on anticipated terms or consummated at all, which could have an adverse impact on our ability to make distributions to our stockholders.

The launch of the Ashford Select platform may not be completed on terms initially anticipated by us or may not be consummated at all. The launch of the Ashford Select platform requires the determination of final structuring and the negotiation of definitive agreements, and may be dependent on the ability of Ashford Select to obtain adequate financing to pay any cash portion of consideration due to us in exchange for select service properties.

We cannot assure you that we will be able to successfully launch the Ashford Select platform with an external capital source or at all. Our failure to complete the Ashford Select launch could have an adverse impact on our operations, prospects and ability to make distributions to our stockholders and could negatively impact the price of our common stock.

47

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Purchases of Equity Securities by the Issuer

The following table provides the information with respect to purchases of shares of our common stock during each of the months in the first quarter of 2015:

Period	Total Number of Shares Purchased (1)	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Plan (2)	Maximum Dollar Value of Shares That May Yet Be Purchased Under the Plan
Common stock:
January 1 to January 31	—	$	—	—	$	200,000,000
February 1 to February 28	—	—		—	200,000,000
March 1 to March 31	42,943	10.40		—	200,000,000
Total	42,943	$	10.40	—

____________________

⁽¹⁾  Represents shares that were withheld to cover tax-withholding requirements related to the vesting of restricted shares of our common stock to employees of our advisor pursuant to the Company’s stockholder approved stock incentive plan.

⁽²⁾  In September 2011, our Board of Directors announced the reinstatement of our 2007 share repurchase program and authorized an increase in repurchase plan authorization from the remaining $58.4 million to $200.0 million. The plan provides for: (i) the repurchase of shares of our common stock, Series A preferred stock, Series D preferred stock and Series E preferred stock, and /or (ii) discounted purchases of outstanding debt obligations, including debt secured by hotel assets. No shares of common or preferred stock have been repurchased under this program since September 2011and none are authorized for purchase without further authorization from our Board of Directors.

ITEM 3. DEFAULT UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

None.

ITEM 5. OTHER INFORMATION

Effective May 8, 2015, Ashford Select entities terminated the two contribution agreements and the two purchase and sale agreements described in our Current Report on Form 8-K that was filed with the SEC on February 23, 2015. 

48

ITEM 6. EXHIBITS

Exhibit	Description
3.1	Articles of Amendment and Restatement (incorporated by reference to Exhibit 3.1 of Form S-11/A, filed on July 31, 2003)
3.2	Second Amended and Restated Bylaws (incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8-K, filed on February 28, 2014)
10.1*	Contribution Agreement, dated February 18, 2015, by and between Ashford Hospitality Select, Inc., Ashford Hospitality Select Limited Partnership and Ashford Hospitality Limited Partnership
10.1.1*	Termination Letter, dated May 8, 2015, of the Contribution Agreement, dated February 18, 2015, by and between Ashford Hospitality Select, Inc., Ashford Hospitality Select Limited Partnership and Ashford Hospitality Limited Partnership
10.2*	Contribution Agreement, dated February 18, 2015, by and between Ashford Hospitality Select, Inc., Ashford Hospitality Select Limited Partnership, Ashford Credit Holdings LLC and Ashford Hospitality Limited Partnership
10.2.1*	Termination Letter, dated May 8, 2015, of the Contribution Agreement, dated February 18, 2015, by and between Ashford Hospitality Select, Inc., Ashford Hospitality Select Limited Partnership, Ashford Credit Holdings LLC and Ashford Hospitality Limited Partnership
10.3*	Purchase and Sale Agreement, dated February 18, 2015, by and between Ashford TRS VI Corporation, Ashford Hospitality Select, Inc. and Ashford Hospitality Select Limited Partnership
10.3.1*	Termination Letter, dated May 8, 2015, of the Purchase and Sale Agreement, dated February 18, 2015, by and between Ashford TRS VI Corporation, Ashford Hospitality Select, Inc. and Ashford Hospitality Select Limited Partnership
10.4*	Purchase and Sale Agreement, dated February 18, 2015, by and between Ashford TRS Corporation, Ashford TRS VI Corporation and Ashford Select TRS Corporation
10.4.1*	Termination Letter, dated May 8, 2015, of the Purchase and Sale Agreement, dated February 18, 2015, by and between Ashford TRS Corporation, Ashford TRS VI Corporation and Ashford Select TRS Corporation
10.5	Loan Agreement, dated March 6, 2015, between each of the Parties set forth on Schedule I, which are subsidiaries of the Company, collectively as Borrower, and Column Financial, Inc. as Lender (incorporated by reference to Exhibit 10.1 to Form 8-K, filed on March 12, 2015, for the event dated March 6, 2015)
10.6	Mezzanine A Loan Agreement, dated March 6, 2015, between HH Swap A LLC and HH Swap G LLC, collectively as Borrower, and Column Financial, Inc., as Lender (incorporated by reference to Exhibit 10.2 to Form 8-K, filed on March 12, 2015, for the event dated March 6, 2015)
10.7	Mezzanine B Loan Agreement, dated March 6, 2015, between HH Mezz Borrower A-2 LLC and HH Mezz Borrower G-2 LLC, collectively as Borrower, and Column Financial, Inc., as Lender (incorporated by reference to Exhibit 10.3 to Form 8-K, filed on March 12, 2015, for the event dated March 6, 2015)
10.8	Mezzanine C Loan Agreement, dated March 6, 2015, between HH Mezz Borrower A-3 LLC and HH Mezz Borrower G-3 LLC, collectively as Borrower, and Column Financial, Inc., as Lender(incorporated by reference to Exhibit 10.4 to Form 8-K, filed on March 12, 2015, for the event dated March 6, 2015)
10.9	Mezzanine D Loan Agreement, dated March 6, 2015, between HH Mezz Borrower A-4 LLC and HH Mezz Borrower G-4 LLC, collectively as Borrower, and Column Financial, Inc., as Lender(incorporated by reference to Exhibit 10.5 to Form 8-K, filed on March 12, 2015, for the event dated March 6, 2015)
12*	Statement Regarding Computation of Ratios of Earnings to Combined Fixed Charges and Preferred Stock Dividends
31.1*	Certifications of Chief Executive Officer Pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended
31.2*	Certifications of Chief Financial Officer Pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended

49

Exhibit	Description
32.1*	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2*	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
The following materials from the Company’s quarterly report on Form 10-Q for the quarter ended March 31, 2015 are formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Balance Sheets; (ii) Consolidated Statements of Operations; (iii) Consolidated Statements Comprehensive Income (Loss); (iii) Consolidated Statement of of Equity; (iv) Consolidated Statements of Cash Flows; and (v) Notes to the Consolidated Financial Statements. In accordance with Rule 402 of Regulation S-T, the XBRL related information in Exhibit 101 to this Quarterly Report on Form 10-Q shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (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 of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
101.INS	XBRL Instance Document	Submitted electronically with this report.
101.SCH	XBRL Taxonomy Extension Schema Document	Submitted electronically with this report.
101.CAL	XBRL Taxonomy Calculation Linkbase Document	Submitted electronically with this report.
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document	Submitted electronically with this report.
101.LAB	XBRL Taxonomy Label Linkbase Document.	Submitted electronically with this report.
101.PRE	XBRL Taxonomy Presentation Linkbase Document.	Submitted electronically with this report.

___________________________________

* Filed herewith.

50

SIGNATURES

Pursuant to the requirements 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.

ASHFORD HOSPITALITY TRUST, INC.

Date:	May 11, 2015	By:	/s/ MONTY J. BENNETT
			Monty J. Bennett
			Chief Executive Officer
Date:	May 11, 2015	By:	/s/ DERIC S. EUBANKS
			Deric S. Eubanks
			Chief Financial Officer

51

EX-10.1

EXHIBIT 10.1

CONTRIBUTION

AGREEMENT

BY AND BETWEEN

ASHFORD HOSPITALITY SELECT, INC.,

a Maryland corporation,

ASHFORD HOSPITALITY SELECT LIMITED PARTNERSHIP,a Delaware limited partnership,

and

ASHFORD HOSPITALITY LIMITED PARTNERSHIP,a Delaware limited partnership

February 18, 2015

TABLE OF CONTENTS

Page

ARTICLE I CONTRIBUTION     1

Section 1.1Contribution Transaction1

Section 1.2Consideration2

Section 1.3Tax Treatment3

Section 1.4Further Action3

ARTICLE II CLOSING PROCEDURES     3

Section 2.1Conditions to Closing3

Section 2.2Documents to be Delivered at Closing5

Section 2.3Termination of the Offering6

Section 2.4Effect of Termination7

Section 2.5Closing Costs7

Section 2.6Tax Withholding7

ARTICLE III REPRESENTATIONS AND WARRANTIES OF ASHFORD SELECT ENTITIES 7

Section 3.1Organization of the Ashford Select Entities7

Section 3.2Authority7

Section 3.3Noncontravention7

Section 3.4Validity of Securities8

Section 3.5Litigation8

Section 3.6Limited Activities8

Section 3.7No Other Representations and Warranties8

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF CONTRIBUTOR     9

Section 4.1Organization of Contributor, the Contributed Entities and Subsidiary Entities9

Section 4.2Authorization of Transaction9

Section 4.3Authority to Conduct Business9

Section 4.4Noncontravention9

Section 4.5No Encumbrances10

Section 4.6No Other Agreements to Sell10

Section 4.7Title to Assets10

Section 4.8Compliance with Laws11

Section 4.9Licenses and Permits11

i

Section 4.10Environmental Matters11

Section 4.11Taxes11

Section 4.12Litigation11

Section 4.13No Insolvency Proceedings12

Section 4.14Investment Representations and Warranties12

Section 4.15Existing Loans14

Section 4.16Material Documents14

Section 4.17No Other Representations and Warranties14

ARTICLE V COVENANTS     14

Section 5.1Covenants of Contributor14

Section 5.2Commercially Reasonable Efforts16

Section 5.3Covenants of the Ashford Select Entities.16

ARTICLE VI TAX MATTERS     16

Section 6.1Tax Returns16

Section 6.2Cooperation17

Section 6.3Transfer Taxes18

Section 6.4Tax Contests18

ARTICLE VII INDEMNITY OBLIGATIONS     18

Section 7.1Indemnity18

Section 7.2Notice of Claims20

Section 7.3Third Party Claims20

Section 7.4Procedure for Indemnification21

Section 7.5Expiration21

Section 7.6Limitations on Indemnification21

Section 7.7Exclusive Remedy21

ARTICLE VIII GENERAL PROVISIONS     22

Section 8.1Additional Definitions22

Section 8.2Tax Agreement23

Section 8.3Amendment23

Section 8.4Entire Agreement; Counterparts; Applicable Law23

Section 8.5Assignability23

Section 8.6Titles23

Section 8.7Third Party Beneficiary24

ii

Section 8.8Severability24

Section 8.9Equitable Remedies24

Section 8.10Attorneys’ Fees24

Section 8.11Notices24

Section 8.12Computation of Time25

Section 8.13Survival25

Section 8.14Time of the Essence25

iii

List of Schedules and Exhibits

Exhibits

Exhibit A – Properties, Contributor and Contributed Interests

Exhibit B - Formation Transactions

Exhibit C - List of Subsidiaries of the Contributed Entities

Exhibit D - Form of Assignment and Assumption Agreement

Schedules

Schedule 4.15 – Existing Loans

Schedule 7.1 – Retained Ashford Trust Guaranteed Obligations

iv

CONTRIBUTION AGREEMENT

THIS CONTRIBUTION AGREEMENT (this “Agreement”) is executed as of this 18th day of February, 2015 by and between ASHFORD HOSPITALITY SELECT, INC., a Maryland corporation (“Ashford Select”), ASHFORD HOSPITALITY SELECT LIMITED PARTNERSHIP, a Delaware limited partnership (“Ashford Select OP”, and, together with Ashford Select, the “Ashford Select Entities”), and ASHFORD HOSPITALITY LIMITED PARTNERSHIP, a Delaware limited partnership (“Ashford Trust OP”, and also referred to herein as the “Contributor”).

WHEREAS, Contributor owns the equity interests (the “Contributed Interests”) in the entities (the “Contributed Entities”) set forth on Exhibit A hereto under the category of “Contributed Entities”, which Contributed Entities directly or indirectly, own the hotel Properties (the “Properties”or each a“Property”) identified on Exhibit A as being owned by the respective Contributed Entity;

WHEREAS, the Contributor desires to contribute to Ashford Select OP as described in Exhibit A, all of such Contributor’s Contributed Interests in such Contributed Entity and Ashford Select OP desires to acquire the Contributed Interests as set forth on Exhibit A hereto, and

WHEREAS, a wholly owned subsidiary of Ashford Select, serves as the sole general partner of Ashford Select OP, and Ashford Select OP will be the operating partnership of Ashford Select;

WHEREAS, the transactions contemplated by this Agreement and certain other structuring transactions to be completed prior to or on the Closing Date as set forth on Exhibit B (collectively the “Formation Transactions”) are in connection with a proposed private placement (the “Offering”) of Ashford Select Class A common stock.

NOW, THEREFORE, in consideration of the foregoing, the representations, warranties, covenants and other terms and the mutual covenants and conditions set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Contributor and the Ashford Select Entities agree as follows:

ARTICLE ICONTRIBUTION

Section 1.1Contribution Transaction.

(a)Upon and subject to the terms and conditions contained in this Agreement, at the Closing (as hereinafter defined), Contributor shall assign, set over and transfer, absolutely and unconditionally to Ashford Select OP all of Contributor’s right, title and interest in and to the Contributed Interests, in each case, free and clear of all Encumbrances except as set forth in Section 4.5, in exchange for the consideration set forth in Section 1.2, and Ashford Select OP shall accept such assignment by Contributor. From and after the Closing Date, Ashford Select OP shall be bound by terms of the organizational documents governing each Contributed Entity and shall undertake, assume punctually and faithfully perform, pay or discharge when due and otherwise in accordance with their respective terms, all agreements, covenants, conditions, obligations and liabilities of Contributor with respect to each Contributed Entity on or after the Closing Date. The “Closing Date” shall mean the date on which the Closing occurs, which shall be on the same date as the closing of the Offering, unless otherwise agreed upon by the parties.

(b)This Agreement shall serve as notice to the partners, manager, or members, as the case may be, of each Contributed Entity of the transfer of Contributor’s Contributed Interests, and such partners, manager or members, as the case may be, of each of the applicable Contributed Entity consents to, and agrees and acknowledges that all requirements and conditions for such transfer and the admission of Ashford Select OP as a substituted partner or member have been satisfied or otherwise waived in accordance with the terms of the organizational documents governing Contributor’s Contributed Interests.

(c)All of the parties hereto agree that, as a result of the assignment and assumption hereunder, for purposes of the organizational documents governing Contributor’s Contributed Interests, Ashford Select OP shall be a substituted limited partner or member, as the case may be, of each Contributed Entity.

Section 1.2Consideration.

(a)Closing Consideration. At the Closing, and subject to the terms and subject to the conditions set forth in this Agreement, as consideration for the contribution by Contributor of the Contributed Interests, the Ashford Select Entities agree to pay to Contributor total consideration of $18,635,334 (the “Closing Contribution Consideration”), payable as follows:

(i)a cash sum of $5,254,044;

(ii)assumption of $12,021,750 in existing mortgage and mezzanine debt secured by the Properties and/or the equity interests in one or more Subsidiary Entities;

2

(iii)66,617 common partnership units issued by Ashford Select OP (“Ashford Select OP Units”) to Ashford Trust OP, valued at $20 per unit; and

(iv)1,360 shares of Class B common stock issued by Ashford Select (“Ashford Select Class B Common Stock”) to Ashford Trust OP, valued at $20 per share.

The issuance of the Ashford Select OP Units shall be evidenced by an amendment to the operating partnership agreement of Ashford Select OP in such form as shall be reasonably acceptable to Ashford Trust OP. The shares of Ashford Select Class B Common Stock to be issued to Contributor shall be issued as uncertificated shares registered in book-entry form. No certificates therefor shall be distributed. Ashford Select shall promptly deliver or caused to be delivered to Ashford Trust OP an account statement reflecting Ashford Trust OP’s ownership of such shares of Ashford Select Class B Common Stock (such statement, the “Class B Account Statement”).

(b)Post-Closing Adjustments. At the Closing, Contributor will receive a credit to the Closing Contribution Consideration (such credit to be paid in cash) in an amount equal to the net working capital (i.e., Contributor’s working capital assets less working capital liabilities (including, Taxes for the current tax year) of the Properties as of the Closing Date, including, without limitation, capital and FF&E reserves, Tax reserves or other cash amounts or reserves held by or on behalf of Contributor). For a period of six (6) months following the Closing Date (or such longer period in order to obtain current year real estate and personal property tax bills, if applicable), the parties shall work together in good faith to true-up the credit provided in this Section 1.2(b).

Section 1.3Tax Treatment.Section 721(a). Any transfer, assignment and exchange by Contributor effectuated pursuant to this Agreement is intended to be governed by Section 721(a) of the Code; provided, however, that the portion of the Contribution Consideration payable in cash or Ashford Select Class B Common Stock shall be treated as a sale of the Contributed Interests to Ashford Select OP to the extent required by Section 707(a)(2)(B) of the Code and the Treasury Regulations thereunder. Each party hereto agrees to the tax treatment described in this Section 1.3, and each such party shall file their respective Tax Returns (as defined in Section 8.1) consistent with such treatment, unless otherwise required by applicable law.

Section 1.4Further Action. If, at any time after the Closing Date, Ashford Select OP shall determine or be advised that any deeds, bills of sale, assignments (including intellectual property assignments), certificates, affidavits, consents, assurances or other actions or items are necessary or desirable to vest, perfect or confirm of record or otherwise transfer the right, title or interest in or to the Contributed Interests contributed by Contributor to Ashford Select OP and all rights and privileges associated with the Properties, Contributor shall execute and deliver all such deeds, bills of sale, assignments (including any intellectual property assignments), certificates, affidavits, consents, and assurances and take and do all such other actions and things as may be necessary or desirable to vest, perfect or confirm any and all right, title and interest in or to the Contributed Interests or otherwise to carry out this Agreement; provided, that Contributor shall not be obligated to take any action or execute any document if the additional actions or documents impose additional

3

liabilities, obligations, covenants, responsibilities, representations or warranties of Contributor that are material in nature and are not contemplated by this Agreement or reasonably inferable by the terms hereof.

ARTICLE IICLOSING PROCEDURES

Section 2.1Conditions to Closing.

(c)Conditions to Each Party’s Obligations. The obligation of each party to effect the contributions contemplated by this Agreement and to consummate the other transactions contemplated hereby on the Closing is subject to the satisfaction or written waiver of the following conditions:

(i)The closing of the Offering shall have occurred prior to or simultaneously with the closing of the transactions contemplated hereby.

(ii)The Formation Transactions shall have been consummated not later than the Closing Date.

(iii)All consents and approvals of Governmental Authorities or third parties, including the waiver of any applicable right of first offer or right of first refusal with respect to the Contributed Interests or the Properties and any consent or approval required under any Existing Loan Documents (as hereinafter defined), necessary for the parties hereto to consummate the transactions contemplated hereby (except for those the absence of which would not have a material adverse effect on the ability of any party hereto to consummate the transactions contemplated by this Agreement) shall have been obtained or waived in writing.

(iv)No Governmental Authority shall have enacted, issued, promulgated, enforced or entered any statute, rule, regulation, executive order, decree, judgment, injunction or other Order (whether temporary, preliminary or permanent), in any case which is in effect and which prevents or prohibits consummation of any of the transactions contemplated in this Agreement nor shall any of the same brought by a Government Authority of competent jurisdiction be pending that seeks the foregoing.

(d)Conditions to Obligations of the Ashford Select Entities. The obligations of the Ashford Select Entities are further subject to the satisfaction of the following conditions (any of which may be waived in writing by the Ashford Select Entities in whole or in part):

(i)Except as would not have a material adverse effect on the business of the Ashford Select Entities, the Contributed Entities or any subsidiary of the Contributed Entities listed on Exhibit C (each, a “Subsidiary Entity”) or the Properties, the representations and warranties of Contributor contained in this Agreement shall be true and correct as of the Closing Date (except to the extent that any such representation or warranty speaks as of an earlier date, in which case it

4

must be true and correct only as of such earlier date). This Section 2.1(b)(i) shall in no way limit, and shall be subject to, the provisions of Section 7.1.

(ii)Contributor shall have executed and delivered each of the closing documents identified in Section 2.2(a) to the Ashford Select Entities, along with any other agreements or instruments reasonably necessary to consummate the contribution of the Contributed Interests to Ashford Select OP (collectively, the “Contributor Closing Documents”).

(e)Conditions to the Obligations of Contributor. The obligations of Contributor are further subject to the satisfaction of the following conditions (any of which may be waived in writing by Contributor in whole or in part):

(i)Except as would not have a material adverse effect on the business of Contributor, the representations and warranties of the Ashford Select Entities contained in this Agreement shall be true and correct as of the Closing Date (except to the extent that any such representation or warranty speaks as of an earlier date, in which case it must be true and correct only as of such earlier date).

(ii)Ashford Trust OP shall be admitted as a limited partner of Ashford Select OP with respect the Ashford Select OP Units.

(iii)Ashford Trust OP shall have received evidence of the issuance of the Ashford Select Class B Common Stock to Ashford Trust OP.

(iv)The applicable Ashford Select Entities shall have executed and delivered each of the closing documents identified in Section 2.2(b) to Contributor, along with any other agreements or instruments reasonably necessary to consummate the transfer of the Closing Contribution Consideration to Contributor (collectively, the “Ashford Select Closing Documents”).

Section 2.2Documents to be Delivered at Closing.

(a)Contributor Closing Documents. On the Closing Date, Contributor shall execute, acknowledge where deemed desirable or necessary by the Ashford Select Entities, and deliver to the Ashford Select Entities, in addition to any other documents mentioned elsewhere herein, the following Contributor Closing Documents:

(i)An assignment, assumption and admission agreement (“Assignment Agreement”)substantially in the form of Exhibit D attached hereto executed by Contributor, assigning the Contributed Interests to Ashford Select OP with the Contributed Entities acknowledging the admission of Ashford Select OP as the successor to Contributor’s Contributed Interests and further acknowledging the admission of Ashford Select OP as a partner or member of such Contributed Entities.

5

(ii)A closing certificate which shall be in a form satisfactory to the Ashford Select Entities and which shall reaffirm (subject to Section 2.1(b)(i)), the accuracy of all representations and warranties in all material respects and the satisfaction in all material respects of all covenants made by Contributor in Articles IV and V hereof.

(iii)A certified copy of all corporate resolutions, consents or partnership actions authorizing the execution, delivery and performance by Contributor of this Agreement and the Contributor Closing Documents.

(iv)True, correct and complete copies of all organizational documents of each Contributed Entity and Subsidiary Entity.

(v)An affidavit certifying that no Contributor, Contributed Entity or Subsidiary Entity is a “foreign person”, as that term is defined by Section 1445 of the Code.

(vi)All documents required by any lender, manager or franchisor in connection with the contribution of the Contributed Interests by Contributor.

(vii)All leases, management agreements, book and records, service contracts and other material documents relating to the operation of the Properties.

(viii)Any other documents reasonably necessary to assign, transfer and convey the Contributed Interests and effectuate the transactions contemplated hereby.

(b)Ashford Select Closing Documents. On the Closing Date, the Ashford Select Entities shall execute, acknowledge where deemed desirable or necessary by Contributor, and deliver to Contributor, (or cause to be executed, acknowledged or delivered) in addition to any other documents mentioned elsewhere herein, the following Ashford Select Closing Documents:

(v) An amended and restated partnership agreement of Ashford Select OP reflecting Ashford Trust OP as a limited partner of Ashford Select OP, owning the Ashford Select OP Units.

(vi)The Class B Account Statement.

(vii)A closing certificate which shall be in a form satisfactory to Contributor and which shall reaffirm (subject to Section 2.1(c)(i)), the accuracy of all representations and warranties in all material respects and the satisfaction in all material respects of all covenants made by the Ashford Select Entities in Articles III and V hereof.

6

(viii)A certified copy of all appropriate corporate resolutions or partnership actions authorizing the execution, delivery and performance by the Ashford Select Entities of this Agreement and the Ashford Select Closing Documents.

(ix)An executed counterpart to the Assignment Agreement.

(x)All documents required by any lender, manager or franchisor in connection with the contribution of the Contributed Interests, including the Replacement Guarantees (as hereinafter defined).

(xi)Any other documents reasonably necessary to assign, transfer and convey the Closing Contribution Consideration to Contributor and effectuate the transactions contemplated hereby.

Section 2.3Termination of the Offering.

(a)If at any time the Ashford Select Entities or the placement agent for the Offering determine in good faith to terminate the Offering, Ashford Select OP will so advise Contributor in writing, whereupon this Agreement shall terminate effective as of the date such notice is delivered.

Section 2.4Effect of Termination. In the event of termination of this Agreement for any reason, all obligations on the part of all parties to this Agreement shall terminate, except as otherwise provided herein.

Section 2.5Closing Costs. Ashford Select OP shall pay and/or reimburse Contributor for all of the closing costs, third party fees and third party expenses, including, but not limited to, banking fees, accounting fees, legal fees, assumption fees, transfer taxes and any other costs and expenses of Contributor arising from the contribution of the Contributed Interests pursuant to this Agreement (collectively, “Closing Costs”), excluding any income Tax liability incurred by Contributor in connection therewith.

Section 2.6Tax Withholding. Ashford Select OP shall be entitled to deduct and withhold, from the Contribution Consideration payable pursuant to this Agreement to Contributor, such amounts as Ashford Select OP is required to deduct and withhold with respect to the making of such payment under the Code or any provision of state, local or foreign Tax Law. To the extent that amounts are so withheld, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to Contributor.

ARTICLE IIIREPRESENTATIONS AND WARRANTIES OF ASHFORD SELECT ENTITIES

As a material inducement to Contributor to enter into this Agreement and to consummate the transactions contemplated hereby, each Ashford Select Entity, on behalf of itself (except as otherwise set forth below), hereby makes to Contributor each of the representations and warranties set forth in this Article III.

7

Section 3.1Organization of the Ashford Select Entities. Each Ashford Select Entity is duly organized, validly existing and in good standing under the laws of the jurisdiction of such entity’s organization.

Section 3.2Authority. Each Ashford Select Entity has full right, authority, power and capacity to: (i) enter into this Agreement and each agreement, document and instrument to be executed and delivered by or on behalf of it pursuant to this Agreement, including without limitation, the Ashford Select Closing Documents; and (ii) carry out the transactions contemplated hereby and thereby. This Agreement and each agreement, document and instrument executed and delivered by any Ashford Select Entity pursuant to this Agreement constitutes, or when executed and delivered will constitute, the legal, valid and binding obligation of such Ashford Select Entity, each enforceable in accordance with its respective terms.

Section 3.3Noncontravention. The execution, delivery and performance of this Agreement and each such agreement, document and instrument by the Ashford Select Entities: (A) does not and will not violate the organizational documents of the Ashford Select Entities; (B) does not and will not violate any foreign, federal, state, local or other Law applicable to the Ashford Select Entities, or require the Ashford Select Entities to obtain any approval, consent or waiver of, or make any filing with, any Person or authority (governmental or otherwise) that has not been obtained or made (or will not have been obtained or made on or before the Closing) or which does not remain in effect; and (C) does not and will not result in a breach of, constitute a default under, accelerate any obligation under or give rise to a right of termination of, any indenture or loan or credit agreement or any other agreement, contract, instrument, mortgage, Lien, lease, permit, authorization, Order, writ, judgment, injunction, decree, determination or arbitration award to which any Ashford Select Entity is a party or by which the property of the Ashford Select Entity is bound or affected, in the case of each of (A), (B) and (C), in any manner that challenges or would reasonably be expected to impair the ability of the Ashford Select Entities to execute or deliver or materially perform its obligations under this Agreement and the documents executed by it pursuant to this Agreement or to consummate the transactions contemplated hereby or thereby.

Section 3.4Validity of Securities

(a)Validity of Ashford Select OP Units. Ashford Select OP hereby represents and warrants that the Ashford Select OP Units to be issued to Ashford Trust OP pursuant to this Agreement have been duly authorized by Ashford Select OP and, when issued against the consideration therefor, will be validly issued by Ashford Select OP, free and clear of all Liens created by Ashford Select OP.

(b)Validity of Ashford Select Class B Common Stock. Ashford Select hereby represents and warrants that the Ashford Select Class B Common Stock to be issued to Ashford Trust OP pursuant to this Agreement has been duly authorized by Ashford Select and, when issued against the consideration therefor, will be validly issued by Ashford Select, free and clear of all liens created by Ashford Select (other than liens created by the organizational documents of the Ashford Select Entities).

8

Section 3.5Litigation. There is no action, suit or proceeding pending or, to the knowledge of the Ashford Select Entities, threatened against the Ashford Select Entities, that challenges or would reasonably be expected to impair the ability of Ashford Select Entities to execute or deliver or materially perform its obligations under this Agreement and the documents executed by it pursuant to this Agreement or to consummate the transactions contemplated hereby or thereby.

Section 3.6Limited Activities. Except for activities in connection with the Offering, the Formation Transactions or in the ordinary course of business, the Ashford Select Entities have not engaged in any material business or incurred any material obligations.

Section 3.7No Other Representations and Warranties. Other than the representations and warranties expressly set forth in this Article III, the Ashford Select Entities shall not be deemed to have made any other representation or warranty in connection with this Agreement or the transactions contemplated hereby.

ARTICLE IVREPRESENTATIONS AND WARRANTIES OF CONTRIBUTOR

As a material inducement to the Ashford Select Entities to enter into Agreement and to consummate the transactions contemplated hereby, Contributor hereby makes to the Ashford Select Entities each of the representations and warranties set forth in this Article IV.

Section 4.1Organization of Contributor, the Contributed Entities and Subsidiary Entities. Contributor, each Contributed Entity and each Subsidiary Entity is duly organized, validly existing and in good standing under the laws of the respective jurisdiction of such entity’s organization, and is qualified to do business in each jurisdiction in which the operation of its business makes such qualification necessary or desirable.

Section 4.2Authorization of Transaction. Subject to the receipt of third-party consents (or waivers) as required as a condition to closing pursuant to Section 2.1(a)(iii), Contributor has full right, authority, power and capacity to: (i) enter into this Agreement and each agreement, document and instrument to be executed and delivered by or on behalf of such Contributor pursuant to this Agreement, including, without limitation, the Contributor Closing Documents; (ii) carry out the transactions contemplated hereby and thereby; and (iii) transfer, sell and deliver the Contributed Interests to Ashford Select OP upon payment therefor in accordance with this Agreement. This Agreement and each agreement, document and instrument executed and delivered by or on behalf of Contributor pursuant to this Agreement constitutes, or when executed and delivered will constitute, the legal, valid and binding obligation of such Contributor, each enforceable in accordance with its respective terms.

Section 4.3Authority to Conduct Business. Each Contributed Entity and Subsidiary Entity is duly authorized to conduct business and is in good standing under the laws of each jurisdiction where such qualification is required. Each Contributed Entity and Subsidiary Entity has full power and authority and all licenses, permits, and authorizations necessary to carry on the businesses in which it is engaged and to own and use the Property owned and used by it. Contributor has delivered, or has cause to be delivered, to the Ashford Select Entities correct and complete

9

copies of the partnership or limited liability company agreement, as applicable, of each Contributed Entity and Subsidiary Entity, as amended to date (each, an “Operating Agreement”). No Contributed Entity or Subsidiary Entity is in default under or in violation of any provision of its Operating Agreement.

Section 4.4Noncontravention. Subject to the receipt of third-party consents (or waivers) as required as a condition to Closing pursuant to Section 2.1(a)(iii), the execution, delivery and performance of this Agreement and each additional agreement, document and instrument to be executed and delivered by or on behalf of Contributor pursuant to this Agreement, including, without limitation, the Contributor Closing Documents: (A) does not and will not violate the Operating Agreement of any Contributed Entity, Subsidiary Entity or Contributor’s partnership agreement, limited liability agreement or bylaws, as applicable; (B) does not and will not violate any foreign, federal, state, local or other Law applicable to any Contributed Entity or Contributor, or require any Contributed Entity or Contributor to obtain any approval, consent or waiver of, or make any filing with, any Person or authority (governmental or otherwise) that has not been obtained or made or which does not remain in effect; and (C) does not and will not result in a breach of, constitute a default under, accelerate any obligation under or give rise to a right of termination of, any indenture or loan or credit agreement or any other agreement, contract, instrument, mortgage, Lien, lease, permit, authorization, Order, writ, judgment, injunction, decree, determination or arbitration award to which any Contributed Entity, Subsidiary Entity or Contributor is a party or by which the property of any Contributed Entity, Subsidiary Entity or Contributor is bound or affected, or result in the creation of any Encumbrance on any Contributed Entity, Subsidiary Entity or the Contributed Interests.

Section 4.5No Encumbrances. As of the Closing Date, Contributor will be the beneficial and record holder of the Contributed Interests, and indirectly, the Subsidiary Entities, free and clear of any restrictions on transfer (other than any restrictions under the Securities Act of 1933, as amended (the “Securities Act”) or the securities laws of any state (“Blue Sky Laws”)), claim, Lien, pledge, voting agreement, option, charge, security interest, mortgage, deed of trust, encumbrance, rights of assignment, purchase rights or other rights of any nature whatsoever of any third party (collectively, “Encumbrances”) other than Liens created by the Existing Loans, and as of the Closing Date, will have the full power and authority to convey the Contributed Interests free and clear of any Encumbrances, and upon delivery of the Assignment Agreement by Contributor conveying the Contributed Interests and receipt by Contributor of the Closing Contribution Consideration as herein provided, Ashford Select OP will acquire good and valid title thereto, free and clear of all Encumbrances. Contributor owns, directly or indirectly, one hundred percent (100%) of the partnership or membership interests, as applicable, in each Contributed Entity, and Exhibit A is true, correct and complete. The Contributed Interests has been duly authorized and validly issued, is fully paid and non-assessable, and there is no requirement for any additional capital contributions to any Contributed Entity or Subsidiary Entity. Except for Interstate Manchester Company LLC and Ashford IHC Partners LP and the terms and conditions of the partnership agreement for Ashford IHC Partners LP, no Contributed Entity has issued any outstanding partnership, LLC membership or other equity ownership interests and no Contributed Entity has outstanding options, warrants, convertible securities, calls, rights, commitments, preemptive rights, agreements, arrangements or understanding of any character obligating any Contributed Entity to (i) issue, deliver or sell, or

10

cause to be issued, delivered or sold, additional equity ownership interests in any Contributed Entity or any securities or obligations convertible into or exchangeable for ownership interests in any Contributed Entity; or (ii) grant, extend or enter into any such option, warrant, convertible security, call, right, commitment, preemptive right, agreement, arrangement or understanding.

Section 4.6No Other Agreements to Sell. Contributor represents that it has made no agreement with, and will not enter into any agreement with, and has no obligation (absolute or contingent) to, any other Person or firm to sell, transfer or in any way encumber the Contributed Interests or to not sell the Contributed Interests, or to enter into any agreement with respect to a sale, transfer or Encumbrance of or put or call right with respect to the Contributed Interests.

Section 4.7Title to Assets. Each Contributed Entity or Subsidiary Entity holding title to a Property (each, an “Owner”),has good and marketable or indefeasible fee simple title to the Property. Each Property is free and clear of all Encumbrances other than the operating leases, management agreements, existing tenant leases, franchise agreements and all matters recorded in the real property records of the county where the Property is located and/or that would be shown on an accurate current survey of the Property. No Contributed Entity or Subsidiary Entity owns nor has any interest in any assets or liabilities that is unrelated to the Properties or the Existing Loans.

Section 4.8Compliance with Laws. Each Contributed Entity and Subsidiary Entity has conducted its business in compliance with all applicable Laws, except for such failures that would not, individually or in the aggregate, reasonably be expected to materially and adversely affect the condition, financial or otherwise, or the earnings or business affairs of any Contributed Entity, Subsidiary Entity or the Properties.

Section 4.9Licenses and Permits. Each Contributed Entity and Subsidiary Entity possesses such certificates, authorities or permits issued by the appropriate state or federal agencies or bodies necessary to conduct the business conducted by it except where failure to have any such certificates, authorities or permits would not have a material adverse effect on such entity. No Contributor, Contributed Entity or Subsidiary Entity has received any written notice of proceedings relating to the revocation or modification or any such certificate, authority or permit which, singly or in the aggregate, if the subject of an unfavorable decision, ruling, or finding, would materially and adversely affect the condition, financial or otherwise, or the earnings or business affairs of any Contributed Entity, Subsidiary Entity or the Properties.

Section 4.10Environmental Matters. Except for matters disclosed in the most recent Phase I environmental reports delivered to Ashford Select, (a) to Contributor’s knowledge, Contributor, each Contributed Entity and each Subsidiary Entity is in compliance with all Environmental Laws and (b) no Contributor, Contributed Entity or Subsidiary Entity has received any written notice from any Governmental Authority or third party alleging that Contributor, any Contributed Entity or any Subsidiary Entity is not in compliance with applicable Environmental Laws. The representations and warranties contained in this Section 4.10 constitute the sole and exclusive representations and warranties made by Contributor concerning environmental matters.

11

Section 4.11Taxes. (i) All Taxes (including, but not limited to, real estate Taxes due and owing with respect to any Property and personal property Taxes) required to be paid by any Contributed Entity or Subsidiary Entity on or before the date hereof have been paid and all Tax Returns required to be filed on or before the date hereof (taking into account any extensions to file previously received) by or on behalf of any Contributed Entity or Subsidiary Entity have been timely filed and such returns were true, correct and complete in all material respects when filed; and (ii) there is no action, suit or proceeding pending against or threatened with respect to any Contributed Entity, Subsidiary Entity or the Properties in respect of any Tax, nor is any claim for additional Tax asserted by any Contributed Entity or Subsidiary Entity nor are any federal, state and local income or franchise Tax Returns of any Contributed Entity or Subsidiary Entity the subject of any audit or examination by any taxing authority. No Contributed Entity or Subsidiary Entity has executed or filed with the Internal Revenue Service or any other taxing authority any agreement now in effect extending the period for assessment or collection of any income or other Taxes.

Section 4.12Litigation. There is no action, suit or proceeding pending or, to the knowledge of the Contributor, threatened against any Contributed Entity or Subsidiary Entity or that affects a Property, which if adversely determined, would reasonably be expected to have a material adverse effect on the condition, financial or otherwise, or the earnings or business affairs of any Contributed Entity, Subsidiary Entity or any Property. There is no action, suit, or proceeding pending or, to the knowledge of Contributor, threatened against Contributor which challenges or impairs the ability of Contributor to execute or deliver, or materially perform its obligations under this Agreement or to consummate the transactions hereby. No Contributor has received notice of any condemnation or eminent domain proceeding.

Section 4.13No Insolvency Proceedings. No bankruptcy or similar insolvency proceeding has been filed, or is currently contemplated, with respect to Contributor, any Contributed Entity or any Subsidiary Entity.

Section 4.14Investment Representations and Warranties. Ashford Trust OP acknowledges that the offering and issuance of the Ashford Select OP Units and the Ashford Select Class B Common Stock to be acquired pursuant to this Agreement are intended to be exempt from registration under the Securities Act and that the Ashford Select Entities’ reliance on such exemptions is predicated in part on the accuracy and completeness of the representations and warranties of Contributor contained herein. In furtherance thereof, Ashford Trust OP represents and warrants to the Ashford Select Entities as follows:

(a)Ashford Trust OP will be acquiring the Ashford Select OP Units and the Ashford Select Class B Common Stock to be received by Ashford Trust OP for its own account and not with the view to the sale or distribution of the same or any part thereof in violation of the federal or state securities laws.

(b)Ashford Trust OP understands that the Ashford Select OP Units (or shares of Ashford Select Class A common stock, if any, issued upon redemption of the Ashford Select OP Units), as well as the Ashford Select Class B Common Stock, to be issued to Ashford Trust OP will not be registered under the Securities Act or Blue Sky Laws by reason of a specific exemption or exemptions from registration under the Securities Act and

12

applicable Blue Sky Laws and, therefore, may not be sold unless registered under the Securities Act or an exemption from registration is available.

(c)Ashford Trust OP is knowledgeable, sophisticated and experienced in business and financial matters; Ashford Trust OP has previously invested in securities similar to the Ashford Select OP Units and the Ashford Select Class B Common Stock and fully understands the limitations on transfer imposed by the federal securities Law. Ashford Trust OP is able to bear the economic risk of holding the Ashford Select OP Units and the Ashford Select Class B Common Stock for an indefinite period of time and is able to afford the complete loss of its investment in the Ashford Select OP Units and the Ashford Select Class B Common Stock; and Ashford Trust OP understands and has taken cognizance of all risk factors related to the purchase of the Ashford Select OP Units and the Ashford Select Class B Common Stock. Ashford Trust OP is relying upon its own independent analysis and assessment (including with respect to taxes), and the advice of its advisors (including tax advisors), and not upon that of Ashford Select or Ashford Select OP, for purposes of evaluating, entering into, and consummating the transactions contemplated hereby.

(d)Ashford Trust OP is an “accredited investor” within the meaning of Rule 501(a) of Regulation D promulgated under the Securities Act.

(e)Ashford Trust OP understands that an investment in Ashford Select OP and Ashford Select involves substantial risks. Ashford Trust OP has had the opportunity to review all documents and information which it has requested concerning its investment in Ashford Select OP and Ashford Select and to ask questions of the proposed management of Ashford Select OP and Ashford Select, and the business and prospects of such entities which Ashford Trust OP deems necessary or desirable to evaluate the merits and risks related to its investment in the Ashford Select OP Units and the Ashford Select Class B Common Stock, and such questions were answered to the satisfaction of Ashford Trust OP.

(f)Contributor understands that the Ashford Select OP Units (and shares of Ashford Select Class A common stock, if any, issued upon redemption of the Ashford Select OP Units), as well as the Ashford Select Class B Common Stock to the extent certificated, will bear a legend substantially to the effect of the following:

The securities represented by this certificate have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or the securities laws of any state. The securities may not be offered, sold, transferred, pledged or otherwise disposed of without an effective registration statement under the Securities Act and under any applicable state securities laws, receipt of a no-action letter issued by the Securities and Exchange Commission (together with either registration or an exemption under applicable state securities laws) or an opinion of counsel acceptable to Ashford Hospitality Select, Inc. and Ashford Hospitality Select Limited Partnership that the proposed transaction will be exempt from registration under the Securities Act and applicable state securities laws;

13

and that Ashford Select OP or Ashford Select, as the case may be, reserve the right to place a stop order against the transfer of the Ashford Select OP Units (and shares of Ashford Select Class A common stock, if any, issued upon redemption of the Ashford Select OP Units), as well as the Ashford Select Class B Common Stock, and to refuse to effect any transfers thereof, in the absence of satisfying the conditions contained in the foregoing legend.

(g)The address set forth for Ashford Trust OP in Section 8.11 is the address of Ashford Trust OP’s principal residence or principal place of business, and Ashford Trust OP has no present intention of becoming a resident of any country, state or jurisdiction other than the country and state in which such principal residence or principal place of business is sited.

(h)Ashford Trust OP acknowledges and agrees that any Ashford Select OP Units issued to it on the Closing Date are not redeemable for a minimum of one year from the issuance date and, during such period, may not be assigned, pledged, sold or otherwise transferred in whole or in part or subjected to any Encumbrance other than the grant of a pledge in favor of Ashford Select OP. Any successor or assignee of Ashford Trust OP with respect to the Ashford Select OP Units will, after the Expiration Date, take the Ashford Select OP Units subject to the rights and limitations set forth in the partnership agreement of Ashford Select OP.

Section 4.15Existing Loans. Schedule 4.15 sets forth a true, correct and complete list, as of the date hereof, of all loans presently encumbering the Properties, Purchased Entity or any Subsidiary Entities that will exist at and after the closing (collectively, the “Existing Loans”), together with the outstanding balance of each such Existing Loan. Other than the outstanding balance set forth with respect to each Existing Loan on Schedule 4.15 and any accrued interest on the Existing Loans, there are no other amounts outstanding under any Existing Loan. No monetary default (beyond applicable notice and cure periods) by any party exists under any of the Existing Loans and the documents entered into in connection therewith (collectively, the “Existing Loan Documents”) and no material non-monetary default (beyond applicable notice and cure periods) by any party exists under any of such Existing Loan Documents. True, correct and complete copies of all Existing Loan Documents have been provided by Contributor to the Ashford Select Parties.

Section 4.16Material Documents. (a) The organizational documents provided by or on behalf of the Contributor to the Ashford Select Entities for each Contributed Entity and Subsidiary Entity are true, correct and complete and there are no other governing documents for such entities; (ii) the financial statements provided by or on behalf of the Contributor to the Ashford Select Entities for each Contributed Entity, Subsidiary Entity and Property are true, correct and complete in all material respects and disclose all material liabilities, including all material contingent liabilities; and (iii) all leases, management agreements, book and records, service contracts and other material documents relating to the operation of the Properties provided by or on behalf of the Contributor to the Ashford Select Entities are true, correct and complete in all material respects.

Section 4.17No Other Representations and Warranties. Other than the representations and warranties expressly set forth in this Article IV or in any Contributor Closing Documents,

14

Contributor shall not be deemed to have made any other representation or warranty in connection with this Agreement or the transactions contemplated hereby.

ARTICLE VCOVENANTS

Section 5.1Covenants of Contributor. From the date hereof through the Closing Date, except as otherwise provided for or as contemplated by this Agreement, the formation Transactions or the other agreements, documents and instruments contemplated hereby, Contributor shall use commercially reasonable efforts to (and shall use commercially reasonable efforts to cause each of Contributed Entity and Subsidiary Entities to conduct its business and operate and maintain the Properties in the ordinary course of business consistent with past practice, pay debt obligations as they become due and payable (except as may be being contested in good faith and in a commercially prudent manner), and use commercially reasonable efforts to preserve intact current business organizations and preserve relationships with lenders and others having business dealings with it, in each case consistent with past practice. From the date hereof through the Closing Date, except as otherwise provided for or as contemplated by this Agreement, the Formation Transactions or other agreements, documents and instruments contemplated hereby or thereby, Contributor shall not:

(a)sell, transfer or otherwise dispose of all or any portion of the Contributed Interests;

(b)(i) issue or authorize the issuance of any securities in respect of, in lieu of or in substitution for the Contributed Interests or make any other changes to the equity capital structure of the Contributed Entities or the Subsidiary Entities, or (ii) purchase, redeem or otherwise acquire the Contributed Interests;

(c)issue, deliver, sell, transfer, dispose, mortgage, pledge, assign or otherwise encumber, or cause the issuance, delivery, sale, transfer, disposition, mortgage, pledge, assignment or other encumbrance of, any limited liability company or partnership interests or other equity interests of the Contributed Entities or the Subsidiary Entities, the Properties or other assets of the Contributed Entities or the Subsidiary Entities;

(d)amend, modify or terminate any lease, contract or other instruments relating to a Property, except on an arms-length basis, on market terms, and in the ordinary course of business consistent with past practice;

(e)take or omit to take any action to cause any Lien to attach to the Contributed Interests, the equity interest in any Subsidiary Entity, or any Property, except for the Existing Loans;

(f)mortgage, pledge, hypothecate, encumber (or permit to become encumbered) all or any portion of the Contributed Interests, the equity interests in any Subsidiary Entities or any Property, except for the Existing Loans;

15

(g)amend the operating or partnership agreement of any Contributed Entity or any Subsidiary Entity, except in connection with the Formation Transactions;

(h)materially alter the manner of keeping the books, accounts or records or the accounting practices therein reflected, of any Contributed Entity or Subsidiary Entity, except in connection with the Formation Transactions;

(i)adopt a plan of liquidation, dissolution, merger, consolidation, restructuring, recapitalization or reorganization with respect to Contributor, any Contributed Entity or any Subsidiary Entity, except in connection with the Formation Transactions;

(j)violate or knowingly cause or permit any Contributed Entity or Subsidiary Entity to violate in any material respect, or fail to use commercially reasonable efforts to cure any material violation of any Existing Loan Documents, the organizational documents of the Contributed Entities or Subsidiary Entities, or applicable Laws; or

(k)authorize, commit or agree to take any of the foregoing actions.

Section 5.2Commercially Reasonable Efforts. Contributor and each Ashford Select Entity shall use commercially reasonable efforts and cooperate with each other in (a) promptly determining whether any filings are required to be made or consents, approvals, waivers, permits or authorizations are required to be obtained (under any applicable Law or regulation from any Governmental Authority or third party) in connection with the transactions contemplated by this Agreement and (b) promptly making any such filings, furnishing information required in connection therewith and timely seeking to obtain any such consents, approvals, waivers, permits or authorizations.

Section 5.3Covenants of the Ashford Select Entities.

(a)As used in this Section 5.3, “Existing Guarantees” means any (i) guaranty or environmental indemnity relating to an Existing Loan, or (ii) guaranty of any contractual obligations relating to any management agreement or franchise agreement of a Property, to which Ashford Hospitality Trust, Inc. (“Ashford Trust”), Ashford Trust OP or any of their Affiliates that is not a Contributed Entity or a Subsidiary Entity (collectively, an “Ashford Trust Guarantor”) is a party. Except for the Existing Guarantees relating to the management agreements and franchise agreements described on Schedule 7.1 attached hereto, effective as of the Closing Date, Ashford Select and/or Ashford Select OP shall become a party to the Existing Guarantees or enter into replacement guaranties or environmental indemnities, as applicable, in substantially the form of the Existing Guarantees (collectively, “Replacement Guarantees”) with respect to all obligations covered therein. The parties acknowledge that (i) Ashford Trust Guarantor shall not be released as of the Closing Date from the Existing Guarantees as to contractual obligations arising from and after the Closing Date relating to the management agreements and franchise agreements described on Schedule 7.1 attached hereto (the “Retained Ashford Trust Guaranteed Obligations”), (ii) Ashford Select Entities shall not enter into Replacement Guarantees at Closing covering the Retained Ashford Trust Guaranteed Obligations, (iii) Ashford Select Entities agree that

16

Ashford Select Entities will enter into Replacement Guarantees covering the Retained Ashford Trust Guaranteed Obligations at such time as the managers and/or franchisors agree to release Ashford Trust Guarantors from the Retained Ashford Trust Guaranteed Obligations, and (iv) Ashford Select Entities agree to indemnify and hold harmless Ashford Trust Guarantor with respect to the Retained Ashford Trust Guaranteed Obligations pursuant to Section 7.1(c) hereof.

ARTICLE VITAX MATTERS

Section 6.1Tax Returns. The following provisions shall govern the allocation of responsibility and payment of Taxes as between the Ashford Select Entities and Contributor for certain Tax matters following the Closing Date:

(c)Contributor shall prepare or cause to be prepared and file or cause to be filed, subject to the review and reasonable approval of the Ashford Select Entities, all Tax Returns for each of the Contributed Entities and Subsidiary Entities for all periods ending on or prior to the Closing Date that are required to be filed after the Closing Date. The Ashford Select Entities hereby recognize Contributor’s authority to execute and file, on behalf of the Contributed Entities and Subsidiary Entities, all such Tax Returns (and agrees to take all action necessary to ensure such authorization in conformity with applicable Law and principles of good governance generally). To the extent not otherwise paid by Contributor to the appropriate taxing authority, Contributor shall reimburse the applicable Ashford Select Entity for Taxes of any Contributed Entity or Subsidiary Entity with respect to all such Tax Returns within fifteen (15) Business Days after payment by an Ashford Select Entity and/or any Contributed Entity or Subsidiary Entity of such Taxes. All such Tax Returns shall be prepared in a manner that is consistent with the past custom and practice of the Contributed Entities, except as required by a change in applicable Law.

(d)The Ashford Select Entities shall prepare or cause to be prepared and file or cause to be filed, subject to the review and reasonable approval of the applicable Contributor, any Tax Returns of any Contributed Entity and Subsidiary Entities for Tax periods which begin before the Closing Date and end after the Closing Date. The applicable Contributor shall pay to the applicable Ashford Select Entity, within fifteen (15) Business Days before the date on which Taxes are to be paid with respect to such periods, an amount equal to the portion of such Taxes which relates to the portion of such Tax period ending on the Closing Date. For purposes of this Section 6.1(b) and Section 7.1(b), in the case of any Taxes that are imposed on a periodic basis and are payable for a Tax period that includes (but does not end on) the Closing Date, the portion of such Tax which relates to the portion of such Tax period ending on the Closing Date shall (x) in the case of any Taxes other than Taxes based upon or related to income, gains or receipts (including sales and use taxes), or employment or payroll Taxes, be deemed to be the amount of such Tax for the entire Tax period multiplied by a fraction the numerator of which is the number of days in the Tax period ending on the Closing Date and the denominator of which is the number of days in the entire Tax period, and (y) in the case of any Tax based upon or related to income, gains or receipts (including

17

sales and use taxes), or employment or payroll Taxes, be deemed equal to the amount which would be payable if the relevant Tax period ended on the Closing Date. Any credits relating to a Tax period that begins before and ends after the Closing Date shall be taken into account as though the relevant Tax period ended on the Closing Date. All determinations necessary to give effect to the foregoing allocations shall be made in a manner consistent with reasonable prior practice of the Contributed Entities or the Subsidiary Entities, as applicable.

(e)The Ashford Select Entities shall prepare and cause to be prepared and file or cause to be filed all other Tax Returns of the Contributed Entities or the Subsidiary Entities.

Section 6.2Cooperation. The Ashford Select Entities, the Contributed Entities, the Subsidiary Entities and Contributor agree to retain all books and records with respect to Tax matters pertinent to the Contributed Entities and Subsidiary Entities, and their respective assets or business relating to any taxable period beginning before the Closing Date until the expiration of the statute of limitations (and, to the extent notified by any Ashford Select Entity, any extensions thereof) of the respective Tax periods, and to abide by all record retention agreements entered into with any taxing authority. The Contributor shall give the Ashford Select Entities reasonable written notice prior to transferring, destroying or discarding any such books and records and, if any Ashford Select Entity so requests, Contributor shall allow Ashford Select Entities to take possession of such books and records at such Ashford Select Entity’s expense.

Section 6.3Transfer Taxes. All sales, use and transfer taxes, bulk transfer taxes, deed taxes, conveyance fees, documentary and recording charges and similar taxes imposed as a result of the transactions contemplated by this Agreement, together with any interest, penalties or additions to such transfer taxes or attributable to any failure to comply with any requirement regarding Tax Returns (“Transfer Taxes”), shall be paid by the Ashford Select Entities. The Ashford Select Entities and Contributor shall cooperate in filing all necessary Tax Returns under applicable Law with respect to Transfer Taxes.

Section 6.4Tax Contests. The Ashford Select Entities shall inform Contributor of the commencement of any audit, examination or proceeding (“Tax Contest”) relating in whole or in part to Taxes for which any Ashford Select Entity may be entitled to indemnity from Contributor hereunder. With respect to any Tax Contest for which Contributor acknowledges in writing that Contributor is liable under Article VII for any and all Losses relating thereto, Contributor shall be entitled to control, in good faith, all proceedings taken in connection with such Tax Contest; provided, however, that (x) Contributor shall promptly notify the Ashford Select Entities in writing of any intention to control such Tax Contest, (y) in the case of a Tax Contest relating to Taxes of any Contributed Entity or any Subsidiary Entities for a Tax period that includes but does not end on the Closing Date, Contributor and Ashford Select Entities shall jointly control all proceedings taken in connection with any such Tax Contest and (z) if any Tax Contest could reasonably be expected to have an adverse effect on any Ashford Select Entity, Contributed Entity, Subsidiary Entities or any of their Affiliates in any Tax period beginning after the Closing Date, the Tax Contest shall not be settled or resolved without the relevant Ashford Select Entity’s consent, which consent shall not be unreasonably withheld or delayed. Notwithstanding the foregoing, if notice is given to Contributor of the commencement of any Tax Contest and Contributor does not, within ten (10) Business Days

18

after notice is given by an Ashford Select Entity, give notice to such Ashford Select Entity of its election to assume the defense thereof (and in connection therewith, acknowledge in writing the indemnification obligation hereunder of Contributor), Contributor shall be bound by any determination made in such Tax Contest or any compromise or settlement thereof effected by the Ashford Select Entity. The failure of an Ashford Select Entity to give reasonably prompt notice of any Tax Contest shall not release, waive or otherwise affect Contributor’s obligation with respect thereto except to the extent that Contributor can demonstrate actual loss and prejudice as a result of such failure. The Ashford Select Entities and the Contributed Entities and Subsidiary Entities shall use their reasonable efforts to provide Contributor with such assistance as may be reasonably requested by Contributor in connection with a Tax Contest controlled solely or jointly by Contributor.

ARTICLE VIIINDEMNITY OBLIGATIONS

Section 7.1Indemnity.

(b)From and after the Closing Date, each party hereto (each of which is an “Indemnifying Party”) shall indemnify and hold harmless the other party and its Affiliates (each of which is an “Indemnified Party”) from and against any and all charges, complaints, claims, actions, causes of action, losses, damages, liabilities and expenses of any nature whatsoever (each, a “Claim”), including amounts paid in settlement, reasonable attorneys’ fees, costs of investigation, costs of investigative judicial or administrative proceedings or appeals therefrom and costs of attachment or similar bonds (collectively, “Losses”) arising out of or relating to, asserted against, imposed upon or incurred by the Indemnified Party in connection with or as a result of any breach of a representation, warranty or covenant of the Indemnifying Party contained in this Agreement or in any schedule, exhibit, certificate or affidavit or any other agreement, document or instrument delivered by the Indemnifying Party pursuant to this Agreement (to the extent not known by Indemnified Party prior to Closing Date). In addition (a) Ashford Select Entities shall jointly and severally indemnify Contributor and hold it harmless from and against any Losses arising from the operation of the business of any Ashford Select Entity, the Contributed Entities or the Subsidiary Entities, or the ownership and operation of the assets of such entities for the period from and after the Closing, and (b) the Contributor shall indemnify Ashford Select Entities, the Contributed Entities and the Subsidiary Entities and hold them harmless from and against any Losses arising from the operation of the business of Contributor, the Contributed Entities or the Subsidiary Entities, or the ownership and operation of the assets of such entities for the period prior to the Closing; provided, however, that: (i) the Ashford Select Entities shall not have any obligation under this Article to indemnify any Indemnified Party against any Losses to the extent that such Losses arise by virtue of (A) any diminution in value of the Ashford Select OP Units or the Ashford Select Class B Common Stock, or (B) Contributor’s breach of this Agreement, gross negligence, willful misconduct or fraud; and (ii) Contributor shall have no obligation under this Article to indemnify any Indemnified Party against any Losses to the extent that such Losses arise by virtue of (A) any diminution in value of the Properties, or (B) any Ashford Select Entity’s breach of this Agreement, gross negligence, willful misconduct or fraud; and

19

(c)(%3) Contributor shall indemnify each of the Ashford Select Entities, the Contributed Entities and the Subsidiary Entities and hold them harmless from and against all Losses arising from: (A) all Taxes of the Contributed Entities, Subsidiary Entities and the Properties for all Tax periods ending on or before the Closing Date, (B) with respect to any Tax period including but not ending on the Closing Date, all Taxes of the Contributed Entities, Subsidiary Entities and the Properties attributable to the portion of such Tax period that ends on and includes the Closing Date, and (C) all Taxes of any Person imposed on the Contributed Entities or Subsidiary Entities as a transferee or successor, by contract or pursuant to any Law (including, but not limited to, Treasury Regulations Section 1.1502-6 and V.T.C.A., Tax Code, Chapter 171) with respect to obligations or relationships existing on or prior to the Closing Date or by agreements entered into or transactions entered into on or prior to the Closing Date.

(i)Contributor shall have no liability for any Taxes or Losses with respect to Taxes that are attributable to any transaction outside the ordinary course of business of the Contributed Entities or Subsidiary Entities entered into by any Ashford Select Entity or its Affiliates or at the direction of any Ashford Select Entity or its Affiliates that occurs on or after the Closing.

(ii)Contributor shall have no liability to any Ashford Select Entity for any Losses attributable to Taxes with respect to (A) any Tax period beginning after the Closing Date, or (B) any portion of a straddle period (a Tax period which includes but does not end on the Closing Date) beginning after the Closing Date.

(d)From and after the Closing Date, the Ashford Select Entities shall jointly and severally indemnify and hold harmless each Ashford Trust Guarantor from and against any and all Losses and Claims related to any Retained Ashford Trust Guaranteed Obligations, and such indemnification obligation shall continue until all debt or management or franchise obligations associated with the Retained Ashford Trust Guaranteed Obligations have been paid and satisfied in full or Ashford Trust Guarantor has been fully released from such Retained Ashford Trust Guaranteed Obligations. From and after the Closing Date, Ashford Trust Guarantor shall indemnify and hold harmless Ashford Select Entities from and against any and all Losses and Claims related to any Replacement Guaranties with respect to any liabilities covered thereunder that relate to the period prior to the Closing, and such indemnification obligation shall continue until all debt or management or franchise obligations associated therewith have been paid and satisfied in full or Ashford Select Entities have been fully released therefrom.

Section 7.2Notice of Claims. At the time when any Indemnified Party learns of any potential Claim against the Indemnifying Party it will promptly give written notice (a “Claim Notice”) to the Indemnifying Party; provided that failure to do so shall not prevent recovery under this Agreement, except to the extent that the Indemnifying Party shall have been materially prejudiced by such failure. Each Claim Notice shall describe in reasonable detail the facts known to such Indemnified Party giving rise to such Claim, and the amount or good faith estimate of the amount of Losses arising therefrom. Unless prohibited by Law, such Indemnified Party shall deliver

20

to the Indemnifying Party, promptly after such Indemnified Party’s receipt thereof, copies of all notices and documents (including court papers) received by such Indemnified Party relating to claims asserted by third parties (“Third Party Claims”). Any Indemnified Party may at its option demand indemnity under this Article VII as soon as a Claim has been threatened by a third party, regardless of whether an actual Loss has been suffered, so long as such Indemnified Party shall in good faith determine that such claim is not frivolous and that such Indemnified Party may be liable for, or otherwise incur, a Loss as a result thereof.

Section 7.3Third Party Claims. The Indemnifying Party shall be entitled, at its own expense, to assume and control the defense of any Claims based on Third Party Claims, through counsel chosen by the Indemnifying Party and reasonably acceptable to such Indemnified Party (or any Person authorized by such Indemnified Party to act on its behalf), if it gives written notice of its intention to do so to such Indemnified Party within 30 days of the receipt of the applicable Claim Notice; provided, however, that such Indemnified Party may at all times participate in such defense at its expense. Without limiting the foregoing, in the event that the Indemnifying Party exercises the right to undertake any such defense against a Third Party Claim, such Indemnified Party shall cooperate with the Indemnifying Party in such defense and make available to the Indemnifying Party (unless prohibited by Law), at the Indemnifying Party’s expense, all witnesses, pertinent records, materials and information in such Indemnified Party’s possession or under such Indemnified Party’s control relating thereto as is reasonably required by the Indemnifying Party. No compromise or settlement of such Third Party Claim may be effected by either such Indemnified Party, on the one hand, or the Indemnifying Party, on the other hand, without the other’s consent (which consent shall not be unreasonably withheld, conditioned or delayed) unless (i) there is no finding or admission of any violation of Law and no effect on any other claims that may be made against such other party and (ii) each Indemnified Party that is party to such other claim is released from all liability with respect to such other claim.

Section 7.4Procedure for Indemnification. Upon determination of the amount of a Claim that is binding on both the Indemnifying Party and the Indemnified Party, the Indemnifying Party shall, within ten (10) days of the date such amount is determined, pay the amount of such Claim by wire transfer of immediately available funds to an account designated by the Indemnified Party.

Section 7.5Expiration.

(a)Subject to the limitations set forth in Section 7.5(b) below, all representations, warranties, covenants and agreements (including those relating to indemnification in Section 7.1) made herein shall survive the Closing Date.

(b)All representations, warranties and covenants of the Indemnifying Party contained in this Agreement shall survive until twelve months after the Closing Date (the “Expiration Date”); provided, however, the representations and warranties set forth in Section 4.11 with respect to Taxes and Section 4.16 with respect to material documents shall survive until the expiration of the applicable statute of limitations for making a claim for such matters. If written notice of a claim in accordance with the provisions of this Article VII has been given prior to the Expiration Date, then the relevant representation, warranty and covenant shall survive, but only with respect to such specific claim, until such claim

21

has been finally resolved. Any claim for indemnification not so asserted in writing by the Expiration Date may not thereafter be asserted and shall forever be waived.

Section 7.6Limitations on Indemnification.

(a)Except as provided in subparagraph (b) below, Contributor shall have no liability under Section 7.1 for any Losses hereunder (i) unless and until the aggregate total amount of all such Losses for which Contributor would, but for this provision, be liable exceeds, on a cumulative basis, $1,000,000.00, and (ii) in excess of, on a cumulative basis, eight percent (8%) of the Contribution Consideration.

(b)The limitations in subparagraph (a) above shall not apply to any Losses resulting from Claims made under Section 7.1(b)(i).

Section 7.7Exclusive Remedy. In furtherance of the foregoing, the Indemnified Parties hereby waive to the fullest extent permitted under applicable Law, any and all rights, claims and causes of action (other than claims of, or causes of action arising from, fraud) it may have against the Indemnifying Party arising under or based upon any federal, state, local or foreign Law, other than the right to seek indemnity pursuant to this Article VII. The foregoing sentence shall not limit the Indemnified Party’s right to specific performance or injunctive relief in connection with the breach by the Indemnifying Party of the provisions of this Agreement.

ARTICLE VIIIGENERAL PROVISIONS

Section 8.1Additional Definitions. For the purposes of this Agreement, the following terms shall have the following meanings:

(a)“Affiliate” means, with respect to any Person, a Person that, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with the specified Person. For the purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”) as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise; provided, however, for purposes of this Agreement, Ashford Select and Ashford Select OP are deemed not to be Affiliates of Ashford Trust or Contributor.

(b)“Business Day” means any day that is not a Saturday, Sunday or legal holiday in the State of Texas.

(c)“Code” means the Internal Revenue Code of 1986, as amended, together with the rules and regulations promulgated or issued thereunder.

(d)“Environmental Law” means all federal, state and local Laws governing pollution or the protection of human health or the environment.

22

(e)“Governmental Authority” means any government or agency, bureau, board, commission, court, department, official, political subdivision, tribunal or other instrumentality of any government, whether federal, state or local, domestic or foreign.

(f)“Law” means laws, statutes, rules, regulations, codes, Orders, ordinances, judgments, injunctions, decrees and policies of any Governmental Authority.

(g)“Liens” means all pledges, claims, liens, charges, restrictions, controls, easements, rights of way, exceptions, reservations, leases, licenses, grants, covenants and conditions, Encumbrances and security interests of any kind or nature whatsoever.

(h)“Order” means any order, writ, judgment, injunction, decree, ruling, assessment, stipulation, determination or award entered by or with any court or other Governmental Authority or arbitrator.

(i)“Person” means an individual, corporation, partnership, limited liability company, joint venture, association, trust, unincorporated organization or other entity.

(j)“Subsidiary” of any Person means any corporation, partnership, limited liability company, joint venture, trust or other legal entity of which such Person owns (either directly or through or together with another Subsidiary of such Person) either (i) a general partner, managing member or other similar interest or (ii) (A) 10% or more of the voting power of the voting capital stock or other equity interests or (B) 10% or more of the outstanding voting capital stock or other voting equity interests of such corporation, partnership, limited liability company, joint venture, trust or other legal entity.

(k)“Taxes” means all federal, state, local and foreign income, property, withholding, sales, franchise, employment, excise and other taxes, tariffs or governmental charges of any nature whatsoever, including estimated taxes, together with penalties, interest or additions to tax with respect thereto.

(l)“Tax Return” means any return, declaration, report, claim for refund, or information return or statement related to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

Section 8.2Tax Agreement. The Ashford Select Entities shall account for any variation between the Tax basis of the Contributed Interests (or, if applicable, each asset owned by any Contributed Entity or Subsidiary Entity, where such entity is disregarded for U.S. federal income tax purposes) and its fair market value at the time of its contribution to the applicable Ashford Select Entity under any method approved under Section 704(c) of the Code and the applicable regulations as chosen by the general partner of Ashford Select OP.

Section 8.3Amendment. Any amendment hereto shall be in writing and signed by all parties hereto. No waiver of any of the provisions of this Agreement shall be valid unless in writing and signed by the party against whom enforcement is sought.

23

Section 8.4Entire Agreement; Counterparts; Applicable Law. This Agreement (a) constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof, (b) may be executed in several counterparts, each of which will be deemed an original and all of which shall constitute one and the same instrument and (c) shall be governed in all respects, including validity, interpretation and effect, by the laws of the State of Texas without giving effect to the conflict of law provisions thereof.

Section 8.5Assignability. This Agreement shall be binding upon, and shall be enforceable by and inure to the benefit of, the parties hereto and their respective heirs, legal representatives, successors and assigns; provided, however, that this Agreement may not be assigned (except by operation of law) by any party without the prior written consent of the other parties, and any attempted assignment without such consent shall be void and of no effect.

Section 8.6Titles. The titles and captions of the Articles, Sections and paragraphs of this Agreement are included for convenience of reference only and shall have no effect on the construction or meaning of this Agreement.

Section 8.7Third Party Beneficiary. No provision of this Agreement is intended, nor shall it be interpreted, to provide or create any third party beneficiary rights or any other rights of any kind in any customer, Affiliate, stockholder, partner, director, officer or employee of any party hereto or any other Person.

Section 8.8Severability. If any provision of this Agreement, or the application thereof, is for any reason held to any extent to be invalid or unenforceable, the remainder of this Agreement and application of such provision to other Persons or circumstances will be interpreted so as to reasonably effect the intent of the parties hereto. The parties further agree to replace such void or unenforceable provision of this Agreement with a valid and enforceable provision that will achieve, to the extent possible, the economic, business and other purposes of the void or unenforceable provision and to execute any amendment, consent or agreement deemed necessary or desirable by a party to effect such replacement.

Section 8.9Equitable Remedies. The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof in any federal or state court located in the State of Texas (as to which the parties agree to submit to jurisdiction for the purposes of such action), this being in addition to any other remedy to which they are entitled at law or in equity.]

Section 8.10Attorneys’ Fees. In connection with any litigation or a court proceeding arising out of this Agreement, the prevailing party shall be entitled to recover all costs incurred, including reasonable attorneys’ fees and legal assistants’ fees and costs whether incurred prior to trial, at trial or on appeal.

24

Section 8.11Notices. Any notice or demand which must or may be given under this Agreement or by law shall, except as otherwise provided, shall be in writing and shall be deemed to have been given (i) five (5) Business Days following sending by registered or certified mail, postage prepaid, (ii) when sent, if sent by facsimile, (iii) when delivered, if delivered personally to the intended recipient, and (iv) one (1) Business Day following sending by overnight delivery via a national courier service and, if each case, addressed to a party at the following address for such party.

(a) in the case of a notice to any Ashford Select Entity, at the following address and telecopy number:

Ashford Hospitality Select Limited Partnership

c/o Ashford Hospitality Advisors LLC

14185 Dallas Parkway, Suite 1100

Dallas, Texas 75254

Attention: Chief Operating Officer

Phone: (972) 496-9600

Fax: (972) 490-9605

(b) in the case of a notice to Contributor, at the following address and telecopy number:

Ashford Hospitality Limited Partnership

c/o Ashford Hospitality Trust, Inc.

14185 Dallas Parkway, Suite 1100

Dallas, Texas 75254

Phone: (972) 490-9600

Fax: (972) 490-9605

(c) in each case, with a copy to:

Andrews Kurth LLP

1717 Main Street, Suite 1700

Dallas, TX 75201

Attention: Muriel C. McFarling

Section 8.12Computation of Time. Any time period provided for herein which shall end on a Saturday, Sunday or legal holiday shall extend to 5:00 p.m. of the next full Business Day. All times are Central Standard Time.

Section 8.13Survival. It is the express intention and agreement of the parties hereto that the representations, warranties and covenants of Contributor and the Ashford Select Entities set forth in this Agreement shall survive the consummation of the transactions contemplated hereby as set forth in Section 7.5(b).

25

Section 8.14Time of the Essence. Time is of the essence with respect to all obligations of Contributor, and the Ashford Select Entitles under this Agreement.

[Signature Pages to Follow]

26

IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement, or caused the Agreement to be duly executed on its behalf, as of the date first above written.

CONTRIBUTOR:

ASHFORD HOSPITALITY LIMITED PARTNERSHIP

By: Ashford OP General Partner LLC, its general partner

By: /s/ DAVID BROOKS

Name: David Brooks

Title: Vice President

[Signature Page to the Contribution Agreement]

ASHFORD SELECT ENTITIES:

ASHFORD HOSPITALITY SELECT, INC.

By: DAVID BROOKS

Name: David Brooks

Title: Chief Operating Officer and General Counsel

ASHFORD HOSPITALITY SELECT LIMITED PARTNERSHIP

By: Ashford OP Select General Partner LLC, its general partner

By: DAVID BROOKS

Name: David Brooks

Title: Vice President

[Signature Page to the Contribution Agreement]

Exhibit A

Properties

Property	Contributor	Contributed Entity	Contributed Interest	Assignee	Relationship to Property
Residence Inn Manchester, 201 Hale Road Manchester, CT Courtyard Manchester, 225 Slater Street Manchester, CT	Ashford Trust OP	Ashford IHC LLC and Ashford IHC Partners LP	100% member interest 84.9% limited partnership interest	Ashford Select OP	Ashford Trust OP owns (a) 100% of Ashford IHC LLC, which owns a 0.1% GP interest in Ashford IHC Partners, LP; and (b) an 84.9% LP interest in Ashford IHC Partners, LP. Ashford IHC Partners, LP owns: (a) 100% of RI-CIH Manchester Parent LLC, which owns a 0.5% GP Interest in RI Manchester Hotel Partners, LP; which owns 100% of the Residence Inn Manchester, Connecticut and 100% of RI Manchester Tenant Corporation, which is the operating lessee of the Residence Inn Manchester, Connecticut; (b) a 99.5% LP interest in RI Manchester Hotel Partners, LP, which owns 100% of the Residence Inn Manchester, Connecticut and 100% of RI Manchester Tenant Corporation, which is the operating lessee of the Residence Inn Manchester, Connecticut; (c) 100% of CY-CIH Manchester Parent LLC, which owns a 0.5% GP interest in CY Manchester Hotel Partners, LP, which owns 100% of the Courtyard Manchester, Connecticut and 100% of CY Manchester Tenant Corporation, which is the operating lessee of the Courtyard Manchester, Connecticut; and (d) a 99.5% LP interest in CY Manchester Hotel Partners, LP, which owns 100% of the Courtyard Manchester, Connecticut and 100% of CY Manchester Tenant Corporation, which is the operating lessee of the Courtyard Manchester, Connecticut.

Exhibit A-1

Exhibit B

Formation Transactions

Exhibit B-1

Exhibit C

List of Subsidiaries of the Contributed Entities

Contributed Entities	Subsidiary Entities
Ashford IHC LLC	Ashford IHC Partners, LP RI-CIH Manchester Parent, LLC CY-CIH Manchester Parent, LLC RI Manchester Hotel Partners, LP CY Manchester Hotel Partners, LP RI Manchester Tenant Corporation CY Manchester Tenant Corporation
Ashford IHC Partners LP	RI-CIH Manchester Parent, LLC CY-CIH Manchester Parent, LLC RI Manchester Hotel Partners, LP CY Manchester Hotel Partners, LP RI Manchester Tenant Corporation CY Manchester Tenant Corporation

Exhibit C-1

Exhibit D

Form of Assignment and Assumption Agreement

Exhibit D-1

SCHEDULE 4.15

Existing Loans

1. Loan in the original principal amount of $7,400,000 made by German American Capital Corporation, as lender, to RI Manchester Hotel Partners, LP, as borrower, on December 20, 2013 with respect to the Residence Inn, Manchester, Connecticut, having an outstanding principal amount as of the Closing Date of $7,298,391.

2. Loan in the original principal amount of $6,900,000 from KeyBank National Association, as lender, to CY Manchester Hotel Partners, LP, as borrower, on May 1, 2014, in connection with the Courtyard Manchester, Connecticut, having an outstanding principal amount as of the Closing Date of $6,829,795.

Schedule 4.15 - 1

SCHEDULE 7.1

Retained Ashford Trust Guaranteed Obligations

1. Franchise Agreement with respect to Residence Inn by Marriott located at 201 Hale Road, Manchester, Connecticut, dated April 11, 2007, between Marriott International, Inc. and RI Manchester Tenant Corporation, as amended.

2. Franchise Agreement with respect to Residence Inn by Marriott located at 225 Slater Street, Manchester, Connecticut, dated April 11, 2007, between Marriott International, Inc. and CY Manchester Tenant Corporation, as amended.

Schedule 7.1 - 1

EX-10.1.1

EXHIBIT 10.1.1

May 8, 2015    

Ashford Hospitality Limited Partnership

14185 Dallas Parkway, Suite 1100

Dallas, TX 75254

Ladies and Gentlemen:

Reference is made to that certain Contribution Agreement (the “Agreement”), dated as of February 18, 2015, by and between Ashford Hospitality Select, Inc., Ashford Hospitality Select Limited Partnership and Ashford Hospitality Limited Partnership. Capitalized terms not otherwise defined in this letter have the meanings assigned in the Agreement.

The undersigned hereby notify you, pursuant to Section 2.3 of the Agreement, that the Agreement is terminated and of no further force and effect.

Very truly yours,

ASHFORD HOSPITALITY SELECT LIMITED PARTNERSHIP

By: Ashford OP Select General Partner LLC, its general partner

By: /s/ DAVID BROOKS

Name: David Brooks

Title: Vice President

EX-10.2

EXHIBIT 10.2

CONTRIBUTION

AGREEMENT

BY AND BETWEEN

ASHFORD HOSPITALITY SELECT, INC.,

a Maryland corporation,

ASHFORD HOSPITALITY SELECT LIMITED PARTNERSHIP,a Delaware limited partnership,

ASHFORD CREDIT HOLDINGS LLC,

A Delaware limited liability company

and

ASHFORD HOSPITALITY LIMITED PARTNERSHIP,a Delaware limited partnership

February 18, 2015

TABLE OF CONTENTS

Page

ARTICLE I CONTRIBUTION1

Section 1.1Contribution Transaction1

Section 1.2Consideration2

Section 1.3Tax Treatment.4

Section 1.4Further Action5

ARTICLE II CLOSING PROCEDURES5

Section 2.1Conditions to Closing5

Section 2.2Documents to be Delivered at Closing7

Section 2.3Termination of the Offering8

Section 2.4Effect of Termination9

Section 2.5Closing Costs9

Section 2.6Tax Withholding9

ARTICLE III REPRESENTATIONS AND WARRANTIES OF ASHFORD SELECT ENTITIES9

Section 3.1Organization of the Ashford Select Entities9

Section 3.2Authority9

Section 3.3Noncontravention9

Section 3.4Validity of Securities10

Section 3.5Litigation10

Section 3.6Limited Activities10

Section 3.7No Other Representations and Warranties10

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF CONTRIBUTOR11

Section 4.1Organization of the Contributors, the Contributed Entities and Subsidiary Entities11

Section 4.2Authorization of Transaction11

Section 4.3Authority to Conduct Business11

Section 4.4Noncontravention11

Section 4.5No Encumbrances12

Section 4.6No Other Agreements to Sell12

Section 4.7Title to Assets12

Section 4.8Compliance with Laws13

Section 4.9Licenses and Permits13

i

Section 4.10Environmental Matters13

Section 4.11Taxes13

Section 4.12Litigation13

Section 4.13No Insolvency Proceedings14

Section 4.14Investment Representations and Warranties14

Section 4.15Existing Loans16

Section 4.16Material Documents16

Section 4.17No Other Representations and Warranties16

ARTICLE V COVENANTS16

Section 5.1Covenants of the Contributors16

Section 5.2Commercially Reasonable Efforts18

Section 5.3Covenants of the Ashford Select Entities.18

ARTICLE VI TAX MATTERS18

Section 6.1Tax Returns18

Section 6.2Cooperation19

Section 6.3Transfer Taxes20

Section 6.4Tax Contests20

ARTICLE VII INDEMNITY OBLIGATIONS20

Section 7.1Indemnity20

Section 7.2Notice of Claims22

Section 7.3Third Party Claims22

Section 7.4Procedure for Indemnification23

Section 7.5Expiration23

Section 7.6Limitations on Indemnification23

Section 7.7Exclusive Remedy24

ARTICLE VIII GENERAL PROVISIONS24

Section 8.1Additional Definitions24

Section 8.2Tax Agreement25

Section 8.3Amendment25

Section 8.4Entire Agreement; Counterparts; Applicable Law25

Section 8.5Assignability25

Section 8.6Titles26

Section 8.7Third Party Beneficiary26

ii

Section 8.8Severability26

Section 8.9Equitable Remedies26

Section 8.10Attorneys’ Fees26

Section 8.11Notices26

Section 8.12Computation of Time27

Section 8.13Survival27

Section 8.14Time of the Essence27

iii

List of Schedules and Exhibits

Exhibits

Exhibit A – Properties, the Contributors and Contributed Interests

Exhibit B - Formation Transactions

Exhibit C - List of Subsidiaries of the Contributed Entities

Exhibit D - Form of Assignment and Assumption Agreement

Schedules

Schedule 4.15 – Existing Loans

Schedule 7.1 – Retained Ashford Trust Guaranteed Obligations

iv

CONTRIBUTION AGREEMENT

THIS CONTRIBUTION AGREEMENT (this “Agreement”) is executed as of this 18th day of February, 2015 by and between ASHFORD HOSPITALITY SELECT, INC., a Maryland corporation (“Ashford Select”), ASHFORD HOSPITALITY SELECT LIMITED PARTNERSHIP, a Delaware limited partnership (“Ashford Select OP”, and, together with Ashford Select, the “Ashford Select Entities”), Ashford Credit Holdings LLC (“Credit Holdings”) and ASHFORD HOSPITALITY LIMITED PARTNERSHIP, a Delaware limited partnership (“Ashford Trust OP”, together with Credit Holdings, the “Contributors”, and each a “Contributor”).

WHEREAS, the Contributors own the equity interests (the “Contributed Interests”) in the entities (the “Contributed Entities”) set forth on Exhibit A hereto under the category of “Contributed Entities”, which Contributed Entities directly or indirectly, own the hotel Properties (the “Properties”or each a“Property”) identified on Exhibit A as being owned by the respective Contributed Entity;

WHEREAS, each Contributor desires to contribute to Ashford Select OP as described in Exhibit A, all of such Contributor’s Contributed Interests in such Contributed Entity and Ashford Select OP desires to acquire the Contributed Interests as set forth on Exhibit A hereto, and

WHEREAS, a wholly owned subsidiary of Ashford Select, serves as the sole general partner of Ashford Select OP, and Ashford Select OP will be the operating partnership of Ashford Select;

WHEREAS, the transactions contemplated by this Agreement and certain other structuring transactions to be completed prior to or on the Closing Date as set forth on Exhibit B (collectively the “Formation Transactions”) are in connection with (i) the transfer of a portfolio of sixteen select service hotel properties from Ashford Trust to Ashford Select (the “Portfolio”) and (ii) a proposed private placement (the “Offering”) of Ashford Select Class A common stock.

NOW, THEREFORE, in consideration of the foregoing, the representations, warranties, covenants and other terms and the mutual covenants and conditions set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Contributors and the Ashford Select Entities agree as follows:

ARTICLE ICONTRIBUTION

Section 1.1Contribution Transaction.

(a)Upon and subject to the terms and conditions contained in this Agreement, at the Closing (as hereinafter defined), the Contributors shall assign, set over and transfer, absolutely and unconditionally to Ashford Select OP all of the Contributors’ right, title and interest in and to the Contributed Interests, in each case, free and clear of all Encumbrances except as set forth in Section 4.5, in exchange for the consideration set forth in Section 1.2, and Ashford Select OP shall accept such assignment by the Contributors. From and after the Closing Date, Ashford Select OP shall be bound by terms of the organizational documents governing each Contributed Entity and shall undertake, assume punctually and faithfully perform, pay or discharge when due and otherwise in accordance with their respective terms, all agreements, covenants, conditions, obligations and liabilities of the Contributors with respect to each Contributed Entity on or after the Closing Date. The “Closing Date” shall mean the date on which the Closing occurs, which shall be on the same date as the closing of the Offering, unless otherwise agreed upon by the parties.

(b)This Agreement shall serve as notice to the partners, manager, or members, as the case may be, of each Contributed Entity of the transfer of the Contributors’ Contributed Interests, and such partners, manager or members, as the case may be, of each of the applicable Contributed Entity consents to, and agrees and acknowledges that all requirements and conditions for such transfer and the admission of Ashford Select OP as a substituted partner or member have been satisfied or otherwise waived in accordance with the terms of the organizational documents governing Contributors’ Contributed Interests.

(c)All of the parties hereto agree that, as a result of the assignment and assumption hereunder, for purposes of the organizational documents governing the Contributors’ Contributed Interests, Ashford Select OP shall be a substituted limited partner or member, as the case may be, of each Contributed Entity.

Section 1.2Consideration.

(a)Closing Consideration. At the Closing, and subject to the terms and subject to the conditions set forth in this Agreement, as consideration for the contribution by the Contributors of the Contributed Interests, the Ashford Select Entities agree to pay to the Contributors total consideration of $281,167,720 (the “Closing Contribution Consideration”), payable as follows:

(i)a cash sum of $50,586,620;

(ii)assumption of $209,820,000 in existing mortgage and mezzanine debt secured by the Properties and/or the equity interests in one or more Subsidiary Entities;

2

(iii)1,017,295 common partnership units issued by Ashford Select OP (“Ashford Select OP Units”) to Ashford Trust OP, valued at $20 per unit; and

(iv)20,760 shares of Class B common stock issued by Ashford Select (“Ashford Select Class B Common Stock”) to Ashford Trust OP, valued at $20 per share.

The issuance of the Ashford Select OP Units shall be evidenced by an amendment to the operating partnership agreement of Ashford Select OP in such form as shall be reasonably acceptable to Ashford Trust OP. The shares of Ashford Select Class B Common Stock to be issued to the Contributors shall be issued as uncertificated shares registered in book-entry form. No certificates therefor shall be distributed. Ashford Select shall promptly deliver or caused to be delivered to Ashford Trust OP an account statement reflecting Ashford Trust OP’s ownership of such shares of Ashford Select Class B Common Stock (such statement, the “Class B Account Statement”).

(b)Post-Closing Adjustments. At the Closing, the Contributors will receive a credit to the Closing Contribution Consideration (such credit to be paid in cash) in an amount equal to the net working capital (i.e., the Contributors’ working capital assets less working capital liabilities (including, Taxes for the current tax year) of the Properties as of the Closing Date, including, without limitation, capital and FF&E reserves, Tax reserves or other cash amounts or reserves held by or on behalf of the Contributors). For a period of six (6) months following the Closing Date (or such longer period in order to obtain current year real estate and personal property tax bills, if applicable), the parties shall work together in good faith to true-up the credit provided in this Section 1.2(b).

(c)Earnout.

(i)Subject to the limitations, adjustments and procedures set forth in this Section 1.2(c), aggregate compensation of up to $10,000,000 (the “Earnout Consideration”, and together with the Closing Contribution Consideration, the “Contribution Consideration”) shall be payable, if at all, by the Ashford Select Entities to the Contributors in the manner set forth in Section 1.2(c)(iii) below based on the performance of the Portfolio during the period commencing on the Closing Date and ending December 31, 2016 (the “Earnout Period”).

(ii)The Earnout Consideration shall be payable, if at all, as follows:

(A)if the aggregate Hotel EBITDA of the Portfolio for the year ended December 31, 2016 (“2016 EBITDA”) is greater than $34,700,000 (the “Earnout Target”), the Ashford Select Entities shall pay to the Contributors $10,000,000.

(B)If 2016 EBITDA is less than the Earnout Target but greater than $28,800,000 (the “Earnout Floor”), the Ashford Select Entities shall pay the Contributors a pro rata portion of $10,000,000, in an amount equal (a) $10,000,000 multiplied by

3

(b) the quotient of, (x) 2016 EBITDA minus the Earnout Floor, which shall be the numerator, and (y) the Earnout Target minus the Earnout Floor, which shall be the denominator.

(C)For purposes of this Agreement, “Hotel EBITDA” shall mean adjusted EBITDA for a particular hotel or portfolio of hotels, as a percent of total revenue, with no allocation of corporate general and administrative expenses or non-recurring expenses; provided, however, the calculation of Hotel EBITDA for the Portfolio for purposes of this Agreement shall be calculated as if the fees payable to Remington Lodging and Hospitality LLC, the hotel manager (“Remington”), for each of the Properties it manages in the Portfolio are payable at rates applicable following the Performance Period (as defined in the master management agreement with Remington).

(iii)The Earnout Consideration shall be payable by the Ashford Select Entities to the Contributors within five (5) business days of the Earnout Date (as defined below), as follows:

(A)Seventy-five percent (75%) of the Earnout Consideration shall be payable, if at all, in cash;

(B)Twenty-four and one half percent (24.5%) of the Earnout Consideration shall be payable, if at all, in Ashford Select OP Units, the value of which shall be the greater of $20.00 and the average closing market price of the Ashford Select Class A Common Stock during a ten (10) day trading period ending the day prior to the Earnout Date.

(C)One half of one percent (0.5%) of the Earnout Consideration shall be payable, if at all, in Ashford Select Class B Common Stock, the value of which shall be the greater of $20.00 and the average closing market price of the Ashford Select Class A Common Stock during a ten (10) day trading period ending the day prior to the Earnout Date.

(iv)Within forty-five (45) days after the end of the Earnout Period, the Ashford Select Entities shall prepare and deliver to the Contributors an unaudited statement which sets forth a reasonably detailed calculation of the Hotel EBITDA of the Portfolio for the Earnout Period (the “Earnout Statement”). The Contributors shall have thirty (30) days to review the Earnout Statement, and if the Contributors objects within such 30 day period, the parties shall use their reasonable efforts to resolve by written agreement such objections. If the Contributors fails to object within 30 days of receipt of the Earnout Statement, or if the parties otherwise resolve any objections, such agreed Earnout Statement shall be final. If any objections are not resolved by the parties, any remaining objections shall be submitted to a nationally or regionally recognized independent accounting firm mutually acceptable to the parties (“Independent Accounting Firm”), whose resolution of any remaining objections, and the resulting Earnout Statement, shall be final and binding on the parties. The fees and expenses of the Independent Accounting Firm shall be paid by the parties in inverse proportion as they may prevail on matters resolved by the Independent Accounting Firm. Within five (5) days following the final and binding determination of the Earnout Statement (the date of such payment hereinafter referred to as the “Earnout Date”), if the Hotel EBITDA of the Portfolio meets the requirements set forth in Section 1.2(c)(ii), the Ashford Select

4

Entities shall pay the Earnout Consideration to the Contributors in accordance with Section1.2(c)(iii)

Section 1.3Tax Treatment.

(a)Section 721(a). Any transfer, assignment and exchange by the Contributors effectuated pursuant to this Agreement is intended to be governed by Section 721(a) of the Code; provided, however, that the portion of the Contribution Consideration and Earnout Consideration payable in cash or Ashford Select Class B Common Stock shall be treated as a sale of the Contributed Interests to Ashford Select OP to the extent required by Section 707(a)(2)(B) of the Code and the Treasury Regulations thereunder. Each party hereto agrees to the tax treatment described in this Section 1.3(a), and each such party shall file their respective Tax Returns (as defined in Section 8.1) consistent with such treatment, unless otherwise required by applicable law.

(b)Section 1031. Any party hereto may consummate the purchase or sale (as applicable) of the Properties as part of a so-called like kind exchange (an “Exchange”) pursuant to § 1031 of the Code, provided that: (i) the Closing Date shall not be unreasonably delayed or affected by reason of the Exchange nor shall the consummation or accomplishment of an Exchange be a condition precedent or condition subsequent to the exchanging party’s obligations under this Agreement, (ii) the exchanging party shall effect the Exchange through an assignment of this Agreement, or its rights under this Agreement, to a qualified intermediary, (iii) neither party shall be required to take an assignment of the purchase agreement for the relinquished or replacement property or be required to acquire or hold title to any real property for purposes of consummating an Exchange desired by the other party; and (iv) the exchanging party shall pay any additional costs that would not otherwise have been incurred by the non-exchanging party had the exchanging party not consummated the transaction through an Exchange (such payment obligation shall survive the Closing Date or any termination of this Agreement). No party shall by this Agreement or acquiescence to an Exchange desired by the other party have its rights under this Agreement affected or diminished in any manner or be responsible for compliance with or be deemed to have warranted to the exchanging party that its Exchange in fact complies with § 1031 of the Code.

Section 1.4Further Action. If, at any time after the Closing Date, Ashford Select OP shall determine or be advised that any deeds, bills of sale, assignments (including intellectual property assignments), certificates, affidavits, consents, assurances or other actions or items are necessary or desirable to vest, perfect or confirm of record or otherwise transfer the right, title or interest in or to the Contributed Interests contributed by the Contributors to Ashford Select OP and all rights and privileges associated with the Properties, the Contributors shall execute and deliver all such deeds, bills of sale, assignments (including any intellectual property assignments), certificates, affidavits, consents, and assurances and take and do all such other actions and things as may be necessary or desirable to vest, perfect or confirm any and all right, title and interest in or to the Contributed Interests or otherwise to carry out this Agreement; provided, that the Contributors shall not be obligated to take any action or execute any document if the additional actions or documents

5

impose additional liabilities, obligations, covenants, responsibilities, representations or warranties of the Contributors that are material in nature and are not contemplated by this Agreement or reasonably inferable by the terms hereof.

ARTICLE IICLOSING PROCEDURES

Section 2.1Conditions to Closing.

(d)Conditions to Each Party’s Obligations. The obligation of each party to effect the contributions contemplated by this Agreement and to consummate the other transactions contemplated hereby on the Closing is subject to the satisfaction or written waiver of the following conditions:

(i)The closing of the Offering shall have occurred prior to or simultaneously with the closing of the transactions contemplated hereby.

(ii)The Formation Transactions shall have been consummated not later than the Closing Date.

(iii)All consents and approvals of Governmental Authorities or third parties, including the waiver of any applicable right of first offer or right of first refusal with respect to the Contributed Interests or the Properties and any consent or approval required under any Existing Loan Documents (as hereinafter defined), necessary for the parties hereto to consummate the transactions contemplated hereby (except for those the absence of which would not have a material adverse effect on the ability of any party hereto to consummate the transactions contemplated by this Agreement) shall have been obtained or waived in writing.

(iv)No Governmental Authority shall have enacted, issued, promulgated, enforced or entered any statute, rule, regulation, executive order, decree, judgment, injunction or other Order (whether temporary, preliminary or permanent), in any case which is in effect and which prevents or prohibits consummation of any of the transactions contemplated in this Agreement nor shall any of the same brought by a Government Authority of competent jurisdiction be pending that seeks the foregoing.

(e)Conditions to Obligations of the Ashford Select Entities. The obligations of the Ashford Select Entities are further subject to the satisfaction of the following conditions (any of which may be waived in writing by the Ashford Select Entities in whole or in part):

(i)Except as would not have a material adverse effect on the business of the Ashford Select Entities, the Contributed Entities or any subsidiary of the Contributed Entities listed on Exhibit C (each, a “Subsidiary Entity”) or the Properties, the representations and warranties of the Contributors contained in this Agreement shall be true and correct as of the Closing Date (except to the extent that any such representation or warranty speaks as of an earlier date, in which case it

6

must be true and correct only as of such earlier date). This Section 2.1(b)(i) shall in no way limit, and shall be subject to, the provisions of Section 7.1.

(ii)the Contributors shall have executed and delivered each of the closing documents identified in Section 2.2(a) to the Ashford Select Entities, along with any other agreements or instruments reasonably necessary to consummate the contribution of the Contributed Interests to Ashford Select OP (collectively, the “Contributor Closing Documents”).

(f)Conditions to the Obligations of the Contributors. The obligations of the Contributors are further subject to the satisfaction of the following conditions (any of which may be waived in writing by the Contributors in whole or in part):

(i)Except as would not have a material adverse effect on the business of the Contributors, the representations and warranties of the Ashford Select Entities contained in this Agreement shall be true and correct as of the Closing Date (except to the extent that any such representation or warranty speaks as of an earlier date, in which case it must be true and correct only as of such earlier date).

(ii)Ashford Trust OP shall be admitted as a limited partner of Ashford Select OP with respect the Ashford Select OP Units.

(iii)Ashford Trust OP shall have received evidence of the issuance of the Ashford Select Class B Common Stock to Ashford Trust OP.

(iv)The applicable Ashford Select Entities shall have executed and delivered each of the closing documents identified in Section 2.2(b) to the Contributors, along with any other agreements or instruments reasonably necessary to consummate the transfer of the Closing Contribution Consideration to the Contributors (collectively, the “Ashford Select Closing Documents”).

Section 2.2Documents to be Delivered at Closing.

(c)Contributor Closing Documents. On the Closing Date, the Contributors shall execute, acknowledge where deemed desirable or necessary by the Ashford Select Entities, and deliver to the Ashford Select Entities, in addition to any other documents mentioned elsewhere herein, the following Contributor Closing Documents:

(v)An assignment, assumption and admission agreement (“Assignment Agreement”)substantially in the form of Exhibit D attached hereto executed by the Contributors, assigning the Contributed Interests to Ashford Select OP with the Contributed Entities acknowledging the admission of Ashford Select OP as the successor to the Contributors’ Contributed Interests and further acknowledging the admission of Ashford Select OP as a partner or member of such Contributed Entities.

7

(vi)A closing certificate which shall be in a form satisfactory to the Ashford Select Entities and which shall reaffirm (subject to Section 2.1(b)(i)), the accuracy of all representations and warranties in all material respects and the satisfaction in all material respects of all covenants made by the Contributors in Articles IV and V hereof.

(vii)A certified copy of all corporate resolutions, consents or partnership actions authorizing the execution, delivery and performance by the Contributors of this Agreement and the Contributor Closing Documents.

(viii)True, correct and complete copies of all organizational documents of each Contributed Entity and Subsidiary Entity.

(ix)An affidavit certifying that no Contributor, Contributed Entity or Subsidiary Entity is a “foreign person”, as that term is defined by Section 1445 of the Code.

(x)All documents required by any lender, manager or franchisor in connection with the contribution of the Contributed Interests by the Contributors.

(xi)All leases, management agreements, book and records, service contracts and other material documents relating to the operation of the Properties.

(xii)Any other documents reasonably necessary to assign, transfer and convey the Contributed Interests and effectuate the transactions contemplated hereby.

(d)Ashford Select Closing Documents. On the Closing Date, the Ashford Select Entities shall execute, acknowledge where deemed desirable or necessary by the Contributors, and deliver to the Contributors, (or cause to be executed, acknowledged or delivered) in addition to any other documents mentioned elsewhere herein, the following Ashford Select Closing Documents:

(iii) An amended and restated partnership agreement of Ashford Select OP reflecting Ashford Trust OP as a limited partner of Ashford Select OP, owning the Ashford Select OP Units.

(iv)The Class B Account Statement.

(v)A closing certificate which shall be in a form satisfactory to the Contributors and which shall reaffirm (subject to Section 2.1(c)(i)), the accuracy of all representations and warranties in all material respects and the satisfaction in all material respects of all covenants made by the Ashford Select Entities in Articles III and V hereof.

8

(vi)A certified copy of all appropriate corporate resolutions or partnership actions authorizing the execution, delivery and performance by the Ashford Select Entities of this Agreement and the Ashford Select Closing Documents.

(vii)An executed counterpart to the Assignment Agreement.

(viii)All documents required by any lender, manager or franchisor in connection with the contribution of the Contributed Interests, including the Replacement Guarantees (as hereinafter defined).

(ix)Any other documents reasonably necessary to assign, transfer and convey the Closing Contribution Consideration to the Contributors and effectuate the transactions contemplated hereby.

Section 2.3Termination of the Offering.

(a)If at any time the Ashford Select Entities or the placement agent for the Offering determine in good faith to terminate the Offering, Ashford Select OP will so advise the Contributors in writing, whereupon this Agreement shall terminate effective as of the date such notice is delivered.

Section 2.4Effect of Termination. In the event of termination of this Agreement for any reason, all obligations on the part of all parties to this Agreement shall terminate, except as otherwise provided herein.

Section 2.5Closing Costs. Ashford Select OP shall pay and/or reimburse the Contributors for all of the closing costs, third party fees and third party expenses, including, but not limited to, banking fees, accounting fees, legal fees, assumption fees, transfer taxes and any other costs and expenses of the Contributors arising from the contribution of the Contributed Interests pursuant to this Agreement (collectively, “Closing Costs”), excluding any income Tax liability incurred by the Contributors in connection therewith.

Section 2.6Tax Withholding. Ashford Select OP shall be entitled to deduct and withhold, from the Contribution Consideration payable pursuant to this Agreement to the Contributors, such amounts as Ashford Select OP is required to deduct and withhold with respect to the making of such payment under the Code or any provision of state, local or foreign Tax Law. To the extent that amounts are so withheld, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the Contributors.

ARTICLE IIIREPRESENTATIONS AND WARRANTIES OF ASHFORD SELECT ENTITIES

As a material inducement to the Contributors to enter into this Agreement and to consummate the transactions contemplated hereby, each Ashford Select Entity, on behalf of itself (except as otherwise set forth below), hereby makes to the Contributors each of the representations and warranties set forth in this Article III.

9

Section 3.1Organization of the Ashford Select Entities. Each Ashford Select Entity is duly organized, validly existing and in good standing under the laws of the jurisdiction of such entity’s organization.

Section 3.2Authority. Each Ashford Select Entity has full right, authority, power and capacity to: (i) enter into this Agreement and each agreement, document and instrument to be executed and delivered by or on behalf of it pursuant to this Agreement, including without limitation, the Ashford Select Closing Documents; and (ii) carry out the transactions contemplated hereby and thereby. This Agreement and each agreement, document and instrument executed and delivered by any Ashford Select Entity pursuant to this Agreement constitutes, or when executed and delivered will constitute, the legal, valid and binding obligation of such Ashford Select Entity, each enforceable in accordance with its respective terms.

Section 3.3Noncontravention. The execution, delivery and performance of this Agreement and each such agreement, document and instrument by the Ashford Select Entities: (A) does not and will not violate the organizational documents of the Ashford Select Entities; (B) does not and will not violate any foreign, federal, state, local or other Law applicable to the Ashford Select Entities, or require the Ashford Select Entities to obtain any approval, consent or waiver of, or make any filing with, any Person or authority (governmental or otherwise) that has not been obtained or made (or will not have been obtained or made on or before the Closing) or which does not remain in effect; and (C) does not and will not result in a breach of, constitute a default under, accelerate any obligation under or give rise to a right of termination of, any indenture or loan or credit agreement or any other agreement, contract, instrument, mortgage, Lien, lease, permit, authorization, Order, writ, judgment, injunction, decree, determination or arbitration award to which any Ashford Select Entity is a party or by which the property of the Ashford Select Entity is bound or affected, in the case of each of (A), (B) and (C), in any manner that challenges or would reasonably be expected to impair the ability of the Ashford Select Entities to execute or deliver or materially perform its obligations under this Agreement and the documents executed by it pursuant to this Agreement or to consummate the transactions contemplated hereby or thereby.

Section 3.4Validity of Securities

(a)Validity of Ashford Select OP Units. Ashford Select OP hereby represents and warrants that the Ashford Select OP Units to be issued to Ashford Trust OP pursuant to this Agreement have been duly authorized by Ashford Select OP and, when issued against the consideration therefor, will be validly issued by Ashford Select OP, free and clear of all Liens created by Ashford Select OP.

(b)Validity of Ashford Select Class B Common Stock. Ashford Select hereby represents and warrants that the Ashford Select Class B Common Stock to be issued to Ashford Trust OP pursuant to this Agreement has been duly authorized by Ashford Select and, when issued against the consideration therefor, will be validly issued by Ashford Select, free and clear of all liens created by Ashford Select (other than liens created by the organizational documents of the Ashford Select Entities).

10

Section 3.5Litigation. There is no action, suit or proceeding pending or, to the knowledge of the Ashford Select Entities, threatened against the Ashford Select Entities, that challenges or would reasonably be expected to impair the ability of Ashford Select Entities to execute or deliver or materially perform its obligations under this Agreement and the documents executed by it pursuant to this Agreement or to consummate the transactions contemplated hereby or thereby.

Section 3.6Limited Activities. Except for activities in connection with the Offering, the Formation Transactions or in the ordinary course of business, the Ashford Select Entities have not engaged in any material business or incurred any material obligations.

Section 3.7No Other Representations and Warranties. Other than the representations and warranties expressly set forth in this Article III, the Ashford Select Entities shall not be deemed to have made any other representation or warranty in connection with this Agreement or the transactions contemplated hereby.

ARTICLE IVREPRESENTATIONS AND WARRANTIES OF CONTRIBUTOR

As a material inducement to the Ashford Select Entities to enter into Agreement and to consummate the transactions contemplated hereby, the Contributors hereby makes to the Ashford Select Entities each of the representations and warranties set forth in this Article IV.

Section 4.1Organization of the Contributors, the Contributed Entities and Subsidiary Entities. Each Contributor, Contributed Entity and Subsidiary Entity is duly organized, validly existing and in good standing under the laws of the respective jurisdiction of such entity’s organization, and is qualified to do business in each jurisdiction in which the operation of its business makes such qualification necessary or desirable.

Section 4.2Authorization of Transaction. Subject to the receipt of third-party consents (or waivers) as required as a condition to closing pursuant to Section 2.1(a)(iii), Each Contributor has full right, authority, power and capacity to: (i) enter into this Agreement and each agreement, document and instrument to be executed and delivered by or on behalf of such Contributor pursuant to this Agreement, including, without limitation, the Contributor Closing Documents; (ii) carry out the transactions contemplated hereby and thereby; and (iii) transfer, sell and deliver the Contributed Interests to Ashford Select OP upon payment therefor in accordance with this Agreement. This Agreement and each agreement, document and instrument executed and delivered by or on behalf of each Contributor pursuant to this Agreement constitutes, or when executed and delivered will constitute, the legal, valid and binding obligation of such Contributor, each enforceable in accordance with its respective terms.

Section 4.3Authority to Conduct Business. Each Contributed Entity and Subsidiary Entity is duly authorized to conduct business and is in good standing under the laws of each jurisdiction where such qualification is required. Each Contributed Entity and Subsidiary Entity has full power and authority and all licenses, permits, and authorizations necessary to carry on the businesses in which it is engaged and to own and use the Property owned and used by it. Each Contributor has delivered, or has cause to be delivered, to the Ashford Select Entities correct and

11

complete copies of the partnership or limited liability company agreement, as applicable, of each Contributed Entity and Subsidiary Entity, as amended to date (each, an “Operating Agreement”). No Contributed Entity or Subsidiary Entity is in default under or in violation of any provision of its Operating Agreement.

Section 4.4Noncontravention. Subject to the receipt of third-party consents (or waivers) as required as a condition to Closing pursuant to Section 2.1(a)(iii), the execution, delivery and performance of this Agreement and each additional agreement, document and instrument to be executed and delivered by or on behalf of each Contributor pursuant to this Agreement, including, without limitation, the Contributor Closing Documents: (A) does not and will not violate the Operating Agreement of any Contributed Entity, Subsidiary Entity or Contributor’s partnership agreement, limited liability agreement or bylaws, as applicable; (B) does not and will not violate any foreign, federal, state, local or other Law applicable to any Contributed Entity or Contributor, or require any Contributed Entity or Contributor to obtain any approval, consent or waiver of, or make any filing with, any Person or authority (governmental or otherwise) that has not been obtained or made or which does not remain in effect; and (C) does not and will not result in a breach of, constitute a default under, accelerate any obligation under or give rise to a right of termination of, any indenture or loan or credit agreement or any other agreement, contract, instrument, mortgage, Lien, lease, permit, authorization, Order, writ, judgment, injunction, decree, determination or arbitration award to which any Contributed Entity, Subsidiary Entity or Contributor is a party or by which the property of any Contributed Entity, Subsidiary Entity or Contributor is bound or affected, or result in the creation of any Encumbrance on any Contributed Entity, Subsidiary Entity or the Contributed Interests.

Section 4.5No Encumbrances. As of the Closing Date, each Contributor will be the beneficial and record holder of the Contributed Interests, and indirectly, the Subsidiary Entities, free and clear of any restrictions on transfer (other than any restrictions under the Securities Act of 1933, as amended (the “Securities Act”) or the securities laws of any state (“Blue Sky Laws”)), claim, Lien, pledge, voting agreement, option, charge, security interest, mortgage, deed of trust, encumbrance, rights of assignment, purchase rights or other rights of any nature whatsoever of any third party (collectively, “Encumbrances”) other than Liens created by the Existing Loans, and as of the Closing Date, will have the full power and authority to convey the Contributed Interests free and clear of any Encumbrances, and upon delivery of the Assignment Agreement by each Contributor conveying the Contributed Interests and receipt by the Contributors of the Closing Contribution Consideration as herein provided, Ashford Select OP will acquire good and valid title thereto, free and clear of all Encumbrances. Each Contributor owns, directly or indirectly, one hundred percent (100%) of the partnership or membership interests, as applicable, in each Contributed Entity, and Exhibit A is true, correct and complete. The Contributed Interests has been duly authorized and validly issued, is fully paid and non-assessable, and there is no requirement for any additional capital contributions to any Contributed Entity or Subsidiary Entity. No Contributed Entity has issued any outstanding partnership, LLC membership or other equity ownership interests and no Contributed Entity has outstanding options, warrants, convertible securities, calls, rights, commitments, preemptive rights, agreements, arrangements or understanding of any character obligating any Contributed Entity to (i) issue, deliver or sell, or cause to be issued, delivered or sold, additional equity ownership interests in any Contributed Entity or any securities or obligations convertible

12

into or exchangeable for ownership interests in any Contributed Entity; or (ii) grant, extend or enter into any such option, warrant, convertible security, call, right, commitment, preemptive right, agreement, arrangement or understanding.

Section 4.6No Other Agreements to Sell. Each Contributor represents that it has made no agreement with, and will not enter into any agreement with, and has no obligation (absolute or contingent) to, any other Person or firm to sell, transfer or in any way encumber the Contributed Interests or to not sell the Contributed Interests, or to enter into any agreement with respect to a sale, transfer or Encumbrance of or put or call right with respect to the Contributed Interests.

Section 4.7Title to Assets. Each Contributed Entity or Subsidiary Entity holding title to a Property (each, an “Owner”),has good and marketable or indefeasible fee simple title to the Property. Each Property is free and clear of all Encumbrances other than the operating leases, management agreements, existing tenant leases, franchise agreements and all matters recorded in the real property records of the county where the Property is located and/or that would be shown on an accurate current survey of the Property. No Contributed Entity or Subsidiary Entity owns nor has any interest in any assets or liabilities that is unrelated to the Properties or the Existing Loans.

Section 4.8Compliance with Laws. Each Contributed Entity and Subsidiary Entity has conducted its business in compliance with all applicable Laws, except for such failures that would not, individually or in the aggregate, reasonably be expected to materially and adversely affect the condition, financial or otherwise, or the earnings or business affairs of any Contributed Entity, Subsidiary Entity or the Properties.

Section 4.9Licenses and Permits. Each Contributed Entity and Subsidiary Entity possesses such certificates, authorities or permits issued by the appropriate state or federal agencies or bodies necessary to conduct the business conducted by it except where failure to have any such certificates, authorities or permits would not have a material adverse effect on such entity. No Contributor, Contributed Entity or Subsidiary Entity has received any written notice of proceedings relating to the revocation or modification or any such certificate, authority or permit which, singly or in the aggregate, if the subject of an unfavorable decision, ruling, or finding, would materially and adversely affect the condition, financial or otherwise, or the earnings or business affairs of any Contributed Entity, Subsidiary Entity or the Properties.

Section 4.10Environmental Matters. Except for matters disclosed in the most recent Phase I environmental reports delivered to Ashford Select, (a) to the Contributors’ knowledge, each Contributor, Contributed Entity and Subsidiary Entity is in compliance with all Environmental Laws and (b) no Contributor, Contributed Entity or Subsidiary Entity has received any written notice from any Governmental Authority or third party alleging that any Contributor, Contributed Entity or any Subsidiary Entity is not in compliance with applicable Environmental Laws. The representations and warranties contained in this Section 4.10 constitute the sole and exclusive representations and warranties made by the Contributors concerning environmental matters.

Section 4.11Taxes. (i) All Taxes (including, but not limited to, real estate Taxes due and owing with respect to any Property and personal property Taxes) required to be paid by any

13

Contributed Entity or Subsidiary Entity on or before the date hereof have been paid and all Tax Returns required to be filed on or before the date hereof (taking into account any extensions to file previously received) by or on behalf of any Contributed Entity or Subsidiary Entity have been timely filed and such returns were true, correct and complete in all material respects when filed; and (ii) there is no action, suit or proceeding pending against or threatened with respect to any Contributed Entity, Subsidiary Entity or the Properties in respect of any Tax, nor is any claim for additional Tax asserted by any Contributed Entity or Subsidiary Entity nor are any federal, state and local income or franchise Tax Returns of any Contributed Entity or Subsidiary Entity the subject of any audit or examination by any taxing authority. No Contributed Entity or Subsidiary Entity has executed or filed with the Internal Revenue Service or any other taxing authority any agreement now in effect extending the period for assessment or collection of any income or other Taxes.

Section 4.12Litigation. There is no action, suit or proceeding pending or, to the knowledge of the Contributors, threatened against any Contributed Entity or Subsidiary Entity or that affects a Property, which if adversely determined, would reasonably be expected to have a material adverse effect on the condition, financial or otherwise, or the earnings or business affairs of any Contributed Entity, Subsidiary Entity or any Property. There is no action, suit, or proceeding pending or, to the knowledge of the Contributors, threatened against the Contributors which challenges or impairs the ability of any Contributor to execute or deliver, or materially perform its obligations under this Agreement or to consummate the transactions hereby. No Contributor has received notice of any condemnation or eminent domain proceeding.

Section 4.13No Insolvency Proceedings. No bankruptcy or similar insolvency proceeding has been filed, or is currently contemplated, with respect to any Contributor, any Contributed Entity or any Subsidiary Entity.

Section 4.14Investment Representations and Warranties. Ashford Trust OP acknowledges that the offering and issuance of the Ashford Select OP Units and the Ashford Select Class B Common Stock to be acquired pursuant to this Agreement are intended to be exempt from registration under the Securities Act and that the Ashford Select Entities’ reliance on such exemptions is predicated in part on the accuracy and completeness of the representations and warranties of the Contributors contained herein. In furtherance thereof, Ashford Trust OP represents and warrants to the Ashford Select Entities as follows:

(a)Ashford Trust OP will be acquiring the Ashford Select OP Units and the Ashford Select Class B Common Stock to be received by Ashford Trust OP for its own account and not with the view to the sale or distribution of the same or any part thereof in violation of the federal or state securities laws.

(b)Ashford Trust OP understands that the Ashford Select OP Units (or shares of Ashford Select Class A common stock, if any, issued upon redemption of the Ashford Select OP Units), as well as the Ashford Select Class B Common Stock, to be issued to Ashford Trust OP will not be registered under the Securities Act or Blue Sky Laws by reason of a specific exemption or exemptions from registration under the Securities Act and applicable Blue Sky Laws and, therefore, may not be sold unless registered under the Securities Act or an exemption from registration is available.

14

(c)Ashford Trust OP is knowledgeable, sophisticated and experienced in business and financial matters; Ashford Trust OP has previously invested in securities similar to the Ashford Select OP Units and the Ashford Select Class B Common Stock and fully understands the limitations on transfer imposed by the federal securities Law. Ashford Trust OP is able to bear the economic risk of holding the Ashford Select OP Units and the Ashford Select Class B Common Stock for an indefinite period of time and is able to afford the complete loss of its investment in the Ashford Select OP Units and the Ashford Select Class B Common Stock; and Ashford Trust OP understands and has taken cognizance of all risk factors related to the purchase of the Ashford Select OP Units and the Ashford Select Class B Common Stock. Ashford Trust OP is relying upon its own independent analysis and assessment (including with respect to taxes), and the advice of its advisors (including tax advisors), and not upon that of Ashford Select or Ashford Select OP, for purposes of evaluating, entering into, and consummating the transactions contemplated hereby.

(d)Ashford Trust OP is an “accredited investor” within the meaning of Rule 501(a) of Regulation D promulgated under the Securities Act.

(e)Ashford Trust OP understands that an investment in Ashford Select OP and Ashford Select involves substantial risks. Ashford Trust OP has had the opportunity to review all documents and information which it has requested concerning its investment in Ashford Select OP and Ashford Select and to ask questions of the proposed management of Ashford Select OP and Ashford Select, and the business and prospects of such entities which Ashford Trust OP deems necessary or desirable to evaluate the merits and risks related to its investment in the Ashford Select OP Units and the Ashford Select Class B Common Stock, and such questions were answered to the satisfaction of Ashford Trust OP.

(f)Each Contributor understands that the Ashford Select OP Units (and shares of Ashford Select Class A common stock, if any, issued upon redemption of the Ashford Select OP Units), as well as the Ashford Select Class B Common Stock to the extent certificated, will bear a legend substantially to the effect of the following:

The securities represented by this certificate have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or the securities laws of any state. The securities may not be offered, sold, transferred, pledged or otherwise disposed of without an effective registration statement under the Securities Act and under any applicable state securities laws, receipt of a no-action letter issued by the Securities and Exchange Commission (together with either registration or an exemption under applicable state securities laws) or an opinion of counsel acceptable to Ashford Hospitality Select, Inc. and Ashford Hospitality Select Limited Partnership that the proposed transaction will be exempt from registration under the Securities Act and applicable state securities laws;

and that Ashford Select OP or Ashford Select, as the case may be, reserve the right to place a stop order against the transfer of the Ashford Select OP Units (and shares of Ashford Select Class A common stock, if any, issued upon redemption of the Ashford Select OP Units), as

15

well as the Ashford Select Class B Common Stock, and to refuse to effect any transfers thereof, in the absence of satisfying the conditions contained in the foregoing legend.

(g)The address set forth for Ashford Trust OP in Section 8.11 is the address of Ashford Trust OP’s principal residence or principal place of business, and Ashford Trust OP has no present intention of becoming a resident of any country, state or jurisdiction other than the country and state in which such principal residence or principal place of business is sited.

(h)Ashford Trust OP acknowledges and agrees that any Ashford Select OP Units issued to it on the Closing Date are not redeemable for a minimum of one year from the issuance date and, during such period, may not be assigned, pledged, sold or otherwise transferred in whole or in part or subjected to any Encumbrance other than the grant of a pledge in favor of Ashford Select OP. Any successor or assignee of Ashford Trust OP with respect to the Ashford Select OP Units will, after the Expiration Date, take the Ashford Select OP Units subject to the rights and limitations set forth in the partnership agreement of Ashford Select OP.

Section 4.15Existing Loans. Schedule 4.15 sets forth a true, correct and complete list, as of the date hereof, of all loans presently encumbering the Properties, Purchased Entity or any Subsidiary Entities that will exist at and after the closing (collectively, the “Existing Loans”), together with the outstanding balance of each such Existing Loan. Other than the outstanding balance set forth with respect to each Existing Loan on Schedule 4.15 and any accrued interest on the Existing Loans, there are no other amounts outstanding under any Existing Loan. No monetary default (beyond applicable notice and cure periods) by any party exists under any of the Existing Loans and the documents entered into in connection therewith (collectively, the “Existing Loan Documents”) and no material non-monetary default (beyond applicable notice and cure periods) by any party exists under any of such Existing Loan Documents. True, correct and complete copies of all Existing Loan Documents have been provided by the Contributors to the Ashford Select Parties.

Section 4.16Material Documents. (a) The organizational documents provided by or on behalf of the Contributors to the Ashford Select Entities for each Contributed Entity and Subsidiary Entity are true, correct and complete and there are no other governing documents for such entities; (ii) the financial statements provided by or on behalf of the Contributors to the Ashford Select Entities for each Contributed Entity, Subsidiary Entity and Property are true, correct and complete in all material respects and disclose all material liabilities, including all material contingent liabilities; and (iii) all leases, management agreements, book and records, service contracts and other material documents relating to the operation of the Properties provided by or on behalf of the Contributors to the Ashford Select Entities are true, correct and complete in all material respects.

Section 4.17No Other Representations and Warranties. Other than the representations and warranties expressly set forth in this Article IV or in any Contributor Closing Documents, the Contributors shall not be deemed to have made any other representation or warranty in connection with this Agreement or the transactions contemplated hereby.

16

ARTICLE VCOVENANTS

Section 5.1Covenants of the Contributors. From the date hereof through the Closing Date, except as otherwise provided for or as contemplated by this Agreement, the formation Transactions or the other agreements, documents and instruments contemplated hereby, the Contributors shall use commercially reasonable efforts to (and shall use commercially reasonable efforts to cause each of Contributed Entity and Subsidiary Entities to conduct its business and operate and maintain the Properties in the ordinary course of business consistent with past practice, pay debt obligations as they become due and payable (except as may be being contested in good faith and in a commercially prudent manner), and use commercially reasonable efforts to preserve intact current business organizations and preserve relationships with lenders and others having business dealings with it, in each case consistent with past practice. From the date hereof through the Closing Date, except as otherwise provided for or as contemplated by this Agreement, the Formation Transactions or other agreements, documents and instruments contemplated hereby or thereby, the Contributors shall not:

(a)sell, transfer or otherwise dispose of all or any portion of the Contributed Interests;

(b)(i) issue or authorize the issuance of any securities in respect of, in lieu of or in substitution for the Contributed Interests or make any other changes to the equity capital structure of the Contributed Entities or the Subsidiary Entities, or (ii) purchase, redeem or otherwise acquire the Contributed Interests;

(c)issue, deliver, sell, transfer, dispose, mortgage, pledge, assign or otherwise encumber, or cause the issuance, delivery, sale, transfer, disposition, mortgage, pledge, assignment or other encumbrance of, any limited liability company or partnership interests or other equity interests of the Contributed Entities or the Subsidiary Entities, the Properties or other assets of the Contributed Entities or the Subsidiary Entities;

(d)amend, modify or terminate any lease, contract or other instruments relating to a Property, except on an arms-length basis, on market terms, and in the ordinary course of business consistent with past practice;

(e)take or omit to take any action to cause any Lien to attach to the Contributed Interests, the equity interest in any Subsidiary Entity, or any Property, except for the Existing Loans;

(f)mortgage, pledge, hypothecate, encumber (or permit to become encumbered) all or any portion of the Contributed Interests, the equity interests in any Subsidiary Entities or any Property, except for the Existing Loans;

(g)amend the operating or partnership agreement of any Contributed Entity or any Subsidiary Entity, except in connection with the Formation Transactions;

17

(h)materially alter the manner of keeping the books, accounts or records or the accounting practices therein reflected, of any Contributed Entity or Subsidiary Entity, except in connection with the Formation Transactions;

(i)adopt a plan of liquidation, dissolution, merger, consolidation, restructuring, recapitalization or reorganization with respect to any Contributor, Contributed Entity or any Subsidiary Entity, except in connection with the Formation Transactions;

(j)violate or knowingly cause or permit any Contributed Entity or Subsidiary Entity to violate in any material respect, or fail to use commercially reasonable efforts to cure any material violation of any Existing Loan Documents, the organizational documents of the Contributed Entities or Subsidiary Entities, or applicable Laws; or

(k)authorize, commit or agree to take any of the foregoing actions.

Section 5.2Commercially Reasonable Efforts. Each Contributor and each Ashford Select Entity shall use commercially reasonable efforts and cooperate with each other in (a) promptly determining whether any filings are required to be made or consents, approvals, waivers, permits or authorizations are required to be obtained (under any applicable Law or regulation from any Governmental Authority or third party) in connection with the transactions contemplated by this Agreement and (b) promptly making any such filings, furnishing information required in connection therewith and timely seeking to obtain any such consents, approvals, waivers, permits or authorizations.

Section 5.3Covenants of the Ashford Select Entities.

(a)As used in this Section 5.3, “Existing Guarantees” means any (i) guaranty or environmental indemnity relating to an Existing Loan, or (ii) guaranty of any contractual obligations relating to any management agreement or franchise agreement of a Property, to which Ashford Hospitality Trust, Inc. (“Ashford Trust”), Ashford Trust OP or any of their Affiliates that is not a Contributed Entity or a Subsidiary Entity (collectively, an “Ashford Trust Guarantor”) is a party. Except for the Existing Guarantees relating to the management agreements and franchise agreements described on Schedule 7.1 attached hereto, effective as of the Closing Date, Ashford Select and/or Ashford Select OP shall become a party to the Existing Guarantees or enter into replacement guaranties or environmental indemnities, as applicable, in substantially the form of the Existing Guarantees (collectively, “Replacement Guarantees”) with respect to all obligations covered therein. The parties acknowledge that (i) Ashford Trust Guarantor shall not be released as of the Closing Date from the Existing Guarantees as to contractual obligations arising from and after the Closing Date relating to the management agreements and franchise agreements described on Schedule 7.1 attached hereto (the “Retained Ashford Trust Guaranteed Obligations”), (ii) Ashford Select Entities shall not enter into Replacement Guarantees at Closing covering the Retained Ashford Trust Guaranteed Obligations, (iii) Ashford Select Entities agree that Ashford Select Entities will enter into Replacement Guarantees covering the Retained Ashford Trust Guaranteed Obligations at such time as the managers and/or franchisors agree to release Ashford Trust Guarantors from the Retained Ashford Trust Guaranteed

18

Obligations, and (iv) Ashford Select Entities agree to indemnify and hold harmless Ashford Trust Guarantor with respect to the Retained Ashford Trust Guaranteed Obligations pursuant to Section 7.1(c) hereof.

ARTICLE VITAX MATTERS

Section 6.1Tax Returns. The following provisions shall govern the allocation of responsibility and payment of Taxes as between the Ashford Select Entities and the Contributors for certain Tax matters following the Closing Date:

(c)the Contributors shall prepare or cause to be prepared and file or cause to be filed, subject to the review and reasonable approval of the Ashford Select Entities, all Tax Returns for each of the Contributed Entities and Subsidiary Entities for all periods ending on or prior to the Closing Date that are required to be filed after the Closing Date. The Ashford Select Entities hereby recognize the Contributors’ authority to execute and file, on behalf of the Contributed Entities and Subsidiary Entities, all such Tax Returns (and agrees to take all action necessary to ensure such authorization in conformity with applicable Law and principles of good governance generally). To the extent not otherwise paid by the Contributors to the appropriate taxing authority, the applicable Contributor shall reimburse the applicable Ashford Select Entity for Taxes of any Contributed Entity or Subsidiary Entity with respect to all such Tax Returns within fifteen (15) Business Days after payment by an Ashford Select Entity and/or any Contributed Entity or Subsidiary Entity of such Taxes. All such Tax Returns shall be prepared in a manner that is consistent with the past custom and practice of the Contributed Entities, except as required by a change in applicable Law.

(d)The Ashford Select Entities shall prepare or cause to be prepared and file or cause to be filed, subject to the review and reasonable approval of the applicable Contributor, any Tax Returns of any Contributed Entity and Subsidiary Entities for Tax periods which begin before the Closing Date and end after the Closing Date. The applicable Contributor shall pay to the applicable Ashford Select Entity, within fifteen (15) Business Days before the date on which Taxes are to be paid with respect to such periods, an amount equal to the portion of such Taxes which relates to the portion of such Tax period ending on the Closing Date. For purposes of this Section 6.1(b) and Section 7.1(b), in the case of any Taxes that are imposed on a periodic basis and are payable for a Tax period that includes (but does not end on) the Closing Date, the portion of such Tax which relates to the portion of such Tax period ending on the Closing Date shall (x) in the case of any Taxes other than Taxes based upon or related to income, gains or receipts (including sales and use taxes), or employment or payroll Taxes, be deemed to be the amount of such Tax for the entire Tax period multiplied by a fraction the numerator of which is the number of days in the Tax period ending on the Closing Date and the denominator of which is the number of days in the entire Tax period, and (y) in the case of any Tax based upon or related to income, gains or receipts (including sales and use taxes), or employment or payroll Taxes, be deemed equal to the amount which would be payable if the relevant Tax period ended on the Closing Date. Any credits relating to a Tax period that begins before and ends after the Closing Date shall be taken into account

19

as though the relevant Tax period ended on the Closing Date. All determinations necessary to give effect to the foregoing allocations shall be made in a manner consistent with reasonable prior practice of the Contributed Entities or the Subsidiary Entities, as applicable.

(e)The Ashford Select Entities shall prepare and cause to be prepared and file or cause to be filed all other Tax Returns of the Contributed Entities or the Subsidiary Entities.

Section 6.2Cooperation. The Ashford Select Entities, the Contributed Entities, the Subsidiary Entities and the Contributors agree to retain all books and records with respect to Tax matters pertinent to the Contributed Entities and Subsidiary Entities, and their respective assets or business relating to any taxable period beginning before the Closing Date until the expiration of the statute of limitations (and, to the extent notified by any Ashford Select Entity, any extensions thereof) of the respective Tax periods, and to abide by all record retention agreements entered into with any taxing authority. The Contributors shall give the Ashford Select Entities reasonable written notice prior to transferring, destroying or discarding any such books and records and, if any Ashford Select Entity so requests, the Contributors shall allow Ashford Select Entities to take possession of such books and records at such Ashford Select Entity’s expense.

Section 6.3Transfer Taxes. All sales, use and transfer taxes, bulk transfer taxes, deed taxes, conveyance fees, documentary and recording charges and similar taxes imposed as a result of the transactions contemplated by this Agreement, together with any interest, penalties or additions to such transfer taxes or attributable to any failure to comply with any requirement regarding Tax Returns (“Transfer Taxes”), shall be paid by the Ashford Select Entities. The Ashford Select Entities and the Contributors shall cooperate in filing all necessary Tax Returns under applicable Law with respect to Transfer Taxes.

Section 6.4Tax Contests. The Ashford Select Entities shall inform the Contributors of the commencement of any audit, examination or proceeding (“Tax Contest”) relating in whole or in part to Taxes for which any Ashford Select Entity may be entitled to indemnity from the Contributors hereunder. With respect to any Tax Contest for which the Contributors acknowledges in writing that the Contributors are liable under Article VII for any and all Losses relating thereto, the Contributors shall be entitled to control, in good faith, all proceedings taken in connection with such Tax Contest; provided, however, that (x) the Contributors shall promptly notify the Ashford Select Entities in writing of any intention to control such Tax Contest, (y) in the case of a Tax Contest relating to Taxes of any Contributed Entity or any Subsidiary Entities for a Tax period that includes but does not end on the Closing Date, the Contributors and Ashford Select Entities shall jointly control all proceedings taken in connection with any such Tax Contest and (z) if any Tax Contest could reasonably be expected to have an adverse effect on any Ashford Select Entity, Contributed Entity, Subsidiary Entities or any of their Affiliates in any Tax period beginning after the Closing Date, the Tax Contest shall not be settled or resolved without the relevant Ashford Select Entity’s consent, which consent shall not be unreasonably withheld or delayed. Notwithstanding the foregoing, if notice is given to the Contributors of the commencement of any Tax Contest and the Contributors do not, within ten (10) Business Days after notice is given by an Ashford Select Entity, give notice to such Ashford Select Entity of its election to assume the defense thereof (and in connection therewith, acknowledge in writing the indemnification obligation hereunder of the

20

Contributors), the Contributors shall be bound by any determination made in such Tax Contest or any compromise or settlement thereof effected by the Ashford Select Entity. The failure of an Ashford Select Entity to give reasonably prompt notice of any Tax Contest shall not release, waive or otherwise affect the Contributors’ obligation with respect thereto except to the extent that the Contributors can demonstrate actual loss and prejudice as a result of such failure. The Ashford Select Entities and the Contributed Entities and Subsidiary Entities shall use their reasonable efforts to provide the Contributors with such assistance as may be reasonably requested by the Contributors in connection with a Tax Contest controlled solely or jointly by the Contributors.

ARTICLE VIIINDEMNITY OBLIGATIONS

Section 7.1Indemnity.

(b)From and after the Closing Date, each party hereto (each of which is an “Indemnifying Party”) shall indemnify and hold harmless the other party and its Affiliates (each of which is an “Indemnified Party”) from and against any and all charges, complaints, claims, actions, causes of action, losses, damages, liabilities and expenses of any nature whatsoever (each, a “Claim”), including amounts paid in settlement, reasonable attorneys’ fees, costs of investigation, costs of investigative judicial or administrative proceedings or appeals therefrom and costs of attachment or similar bonds (collectively, “Losses”) arising out of or relating to, asserted against, imposed upon or incurred by the Indemnified Party in connection with or as a result of any breach of a representation, warranty or covenant of the Indemnifying Party contained in this Agreement or in any schedule, exhibit, certificate or affidavit or any other agreement, document or instrument delivered by the Indemnifying Party pursuant to this Agreement (to the extent not known by Indemnified Party prior to Closing Date). In addition (a) Ashford Select Entities shall jointly and severally indemnify the Contributors and hold each of them harmless from and against any Losses arising from the operation of the business of any Ashford Select Entity, the Contributed Entities or the Subsidiary Entities, or the ownership and operation of the assets of such entities for the period from and after the Closing, and (b) the Contributors shall jointly and severally indemnify Ashford Select Entities, the Contributed Entities and the Subsidiary Entities and hold them harmless from and against any Losses arising from the operation of the business of the Contributors, the Contributed Entities or the Subsidiary Entities, or the ownership and operation of the assets of such entities for the period prior to the Closing; provided, however, that: (i) the Ashford Select Entities shall not have any obligation under this Article to indemnify any Indemnified Party against any Losses to the extent that such Losses arise by virtue of (A) any diminution in value of the Ashford Select OP Units or the Ashford Select Class B Common Stock, or (B) the Contributors’ breach of this Agreement, gross negligence, willful misconduct or fraud; and (ii) the Contributors shall have no obligation under this Article to indemnify any Indemnified Party against any Losses to the extent that such Losses arise by virtue of (A) any diminution in value of the Properties, or (B) any Ashford Select Entity’s breach of this Agreement, gross negligence, willful misconduct or fraud; and

21

(c)(%3) The Contributors shall indemnify each of the Ashford Select Entities, the Contributed Entities and the Subsidiary Entities and hold them harmless from and against all Losses arising from: (A) all Taxes of the Contributed Entities, Subsidiary Entities and the Properties for all Tax periods ending on or before the Closing Date, (B) with respect to any Tax period including but not ending on the Closing Date, all Taxes of the Contributed Entities, Subsidiary Entities and the Properties attributable to the portion of such Tax period that ends on and includes the Closing Date, and (C) all Taxes of any Person imposed on the Contributed Entities or Subsidiary Entities as a transferee or successor, by contract or pursuant to any Law (including, but not limited to, Treasury Regulations Section 1.1502-6 and V.T.C.A., Tax Code, Chapter 171) with respect to obligations or relationships existing on or prior to the Closing Date or by agreements entered into or transactions entered into on or prior to the Closing Date.

(i)The Contributors shall have no liability for any Taxes or Losses with respect to Taxes that are attributable to any transaction outside the ordinary course of business of the Contributed Entities or Subsidiary Entities entered into by any Ashford Select Entity or its Affiliates or at the direction of any Ashford Select Entity or its Affiliates that occurs on or after the Closing.

(ii)The Contributors shall have no liability to any Ashford Select Entity for any Losses attributable to Taxes with respect to (A) any Tax period beginning after the Closing Date, or (B) any portion of a straddle period (a Tax period which includes but does not end on the Closing Date) beginning after the Closing Date.

(d)From and after the Closing Date, the Ashford Select Entities shall jointly and severally indemnify and hold harmless each Ashford Trust Guarantor from and against any and all Losses and Claims related to any Retained Ashford Trust Guaranteed Obligations, and such indemnification obligation shall continue until all debt or management or franchise obligations associated with the Retained Ashford Trust Guaranteed Obligations have been paid and satisfied in full or Ashford Trust Guarantor has been fully released from such Retained Ashford Trust Guaranteed Obligations. From and after the Closing Date, Ashford Trust Guarantor shall indemnify and hold harmless Ashford Select Entities from and against any and all Losses and Claims related to any Replacement Guaranties with respect to any liabilities covered thereunder that relate to the period prior to the Closing, and such indemnification obligation shall continue until all debt or management or franchise obligations associated therewith have been paid and satisfied in full or Ashford Select Entities have been fully released therefrom.

Section 7.2Notice of Claims. At the time when any Indemnified Party learns of any potential Claim against the Indemnifying Party it will promptly give written notice (a “Claim Notice”) to the Indemnifying Party; provided that failure to do so shall not prevent recovery under this Agreement, except to the extent that the Indemnifying Party shall have been materially prejudiced by such failure. Each Claim Notice shall describe in reasonable detail the facts known to such Indemnified Party giving rise to such Claim, and the amount or good faith estimate of the amount of Losses arising therefrom. Unless prohibited by Law, such Indemnified Party shall deliver

22

to the Indemnifying Party, promptly after such Indemnified Party’s receipt thereof, copies of all notices and documents (including court papers) received by such Indemnified Party relating to claims asserted by third parties (“Third Party Claims”). Any Indemnified Party may at its option demand indemnity under this Article VII as soon as a Claim has been threatened by a third party, regardless of whether an actual Loss has been suffered, so long as such Indemnified Party shall in good faith determine that such claim is not frivolous and that such Indemnified Party may be liable for, or otherwise incur, a Loss as a result thereof.

Section 7.3Third Party Claims. The Indemnifying Party shall be entitled, at its own expense, to assume and control the defense of any Claims based on Third Party Claims, through counsel chosen by the Indemnifying Party and reasonably acceptable to such Indemnified Party (or any Person authorized by such Indemnified Party to act on its behalf), if it gives written notice of its intention to do so to such Indemnified Party within 30 days of the receipt of the applicable Claim Notice; provided, however, that such Indemnified Party may at all times participate in such defense at its expense. Without limiting the foregoing, in the event that the Indemnifying Party exercises the right to undertake any such defense against a Third Party Claim, such Indemnified Party shall cooperate with the Indemnifying Party in such defense and make available to the Indemnifying Party (unless prohibited by Law), at the Indemnifying Party’s expense, all witnesses, pertinent records, materials and information in such Indemnified Party’s possession or under such Indemnified Party’s control relating thereto as is reasonably required by the Indemnifying Party. No compromise or settlement of such Third Party Claim may be effected by either such Indemnified Party, on the one hand, or the Indemnifying Party, on the other hand, without the other’s consent (which consent shall not be unreasonably withheld, conditioned or delayed) unless (i) there is no finding or admission of any violation of Law and no effect on any other claims that may be made against such other party and (ii) each Indemnified Party that is party to such other claim is released from all liability with respect to such other claim.

Section 7.4Procedure for Indemnification. Upon determination of the amount of a Claim that is binding on both the Indemnifying Party and the Indemnified Party, the Indemnifying Party shall, within ten (10) days of the date such amount is determined, pay the amount of such Claim by wire transfer of immediately available funds to an account designated by the Indemnified Party.

Section 7.5Expiration.

(a)Subject to the limitations set forth in Section 7.5(b) below, all representations, warranties, covenants and agreements (including those relating to indemnification in Section 7.1) made herein shall survive the Closing Date.

(b)All representations, warranties and covenants of the Indemnifying Party contained in this Agreement shall survive until twelve months after the Closing Date (the “Expiration Date”); provided, however, the representations and warranties set forth in Section 4.11 with respect to Taxes, and Section 4.16 with respect to material documents shall survive until the expiration of the applicable statute of limitations for making a claim for such matters. If written notice of a claim in accordance with the provisions of this Article VII has been given prior to the Expiration Date, then the relevant representation, warranty and covenant shall survive, but only with respect to such specific claim, until such claim

23

has been finally resolved. Any claim for indemnification not so asserted in writing by the Expiration Date may not thereafter be asserted and shall forever be waived.

Section 7.6Limitations on Indemnification.

(a)Except as provided in subparagraph (b) below, the Contributors shall have no liability under Section 7.1 for any Losses hereunder (i) unless and until the aggregate total amount of all such Losses for which the Contributors would, but for this provision, be liable exceeds, on a cumulative basis, $1,000,000.00 and (ii) in excess of, on a cumulative basis, eight percent (8%) of the Contribution Consideration.

(b)The limitations in subparagraph (a) above shall not apply to any Losses resulting from Claims made under Section 7.1(b)(i).

Section 7.7Exclusive Remedy. In furtherance of the foregoing, the Indemnified Parties hereby waive to the fullest extent permitted under applicable Law, any and all rights, claims and causes of action (other than claims of, or causes of action arising from, fraud) it may have against the Indemnifying Party arising under or based upon any federal, state, local or foreign Law, other than the right to seek indemnity pursuant to this Article VII. The foregoing sentence shall not limit the Indemnified Party’s right to specific performance or injunctive relief in connection with the breach by the Indemnifying Party of the provisions of this Agreement.

ARTICLE VIIIGENERAL PROVISIONS

Section 8.1Additional Definitions. For the purposes of this Agreement, the following terms shall have the following meanings:

(a)“Affiliate” means, with respect to any Person, a Person that, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with the specified Person. For the purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”) as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise; provided, however, for purposes of this Agreement, Ashford Select and Ashford Select OP are deemed not to be Affiliates of Ashford Trust or the Contributors.

(b)“Business Day” means any day that is not a Saturday, Sunday or legal holiday in the State of Texas.

(c)“Code” means the Internal Revenue Code of 1986, as amended, together with the rules and regulations promulgated or issued thereunder.

(d)“Environmental Law” means all federal, state and local Laws governing pollution or the protection of human health or the environment.

24

(e)“Governmental Authority” means any government or agency, bureau, board, commission, court, department, official, political subdivision, tribunal or other instrumentality of any government, whether federal, state or local, domestic or foreign.

(f)“Law” means laws, statutes, rules, regulations, codes, Orders, ordinances, judgments, injunctions, decrees and policies of any Governmental Authority.

(g)“Liens” means all pledges, claims, liens, charges, restrictions, controls, easements, rights of way, exceptions, reservations, leases, licenses, grants, covenants and conditions, Encumbrances and security interests of any kind or nature whatsoever.

(h)“Order” means any order, writ, judgment, injunction, decree, ruling, assessment, stipulation, determination or award entered by or with any court or other Governmental Authority or arbitrator.

(i)“Person” means an individual, corporation, partnership, limited liability company, joint venture, association, trust, unincorporated organization or other entity.

(j)“Subsidiary” of any Person means any corporation, partnership, limited liability company, joint venture, trust or other legal entity of which such Person owns (either directly or through or together with another Subsidiary of such Person) either (i) a general partner, managing member or other similar interest or (ii) (A) 10% or more of the voting power of the voting capital stock or other equity interests or (B) 10% or more of the outstanding voting capital stock or other voting equity interests of such corporation, partnership, limited liability company, joint venture, trust or other legal entity.

(k)“Taxes” means all federal, state, local and foreign income, property, withholding, sales, franchise, employment, excise and other taxes, tariffs or governmental charges of any nature whatsoever, including estimated taxes, together with penalties, interest or additions to tax with respect thereto.

(l)“Tax Return” means any return, declaration, report, claim for refund, or information return or statement related to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

Section 8.2Tax Agreement. The Ashford Select Entities shall account for any variation between the Tax basis of the Contributed Interests (or, if applicable, each asset owned by any Contributed Entity or Subsidiary Entity, where such entity is disregarded for U.S. federal income tax purposes) and its fair market value at the time of its contribution to the applicable Ashford Select Entity under any method approved under Section 704(c) of the Code and the applicable regulations as chosen by the general partner of Ashford Select OP.

Section 8.3Amendment. Any amendment hereto shall be in writing and signed by all parties hereto. No waiver of any of the provisions of this Agreement shall be valid unless in writing and signed by the party against whom enforcement is sought.

25

Section 8.4Entire Agreement; Counterparts; Applicable Law. This Agreement (a) constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof, (b) may be executed in several counterparts, each of which will be deemed an original and all of which shall constitute one and the same instrument and (c) shall be governed in all respects, including validity, interpretation and effect, by the laws of the State of Texas without giving effect to the conflict of law provisions thereof.

Section 8.5Assignability. This Agreement shall be binding upon, and shall be enforceable by and inure to the benefit of, the parties hereto and their respective heirs, legal representatives, successors and assigns; provided, however, that this Agreement may not be assigned (except by operation of law) by any party without the prior written consent of the other parties, and any attempted assignment without such consent shall be void and of no effect.

Section 8.6Titles. The titles and captions of the Articles, Sections and paragraphs of this Agreement are included for convenience of reference only and shall have no effect on the construction or meaning of this Agreement.

Section 8.7Third Party Beneficiary. No provision of this Agreement is intended, nor shall it be interpreted, to provide or create any third party beneficiary rights or any other rights of any kind in any customer, Affiliate, stockholder, partner, director, officer or employee of any party hereto or any other Person.

Section 8.8Severability. If any provision of this Agreement, or the application thereof, is for any reason held to any extent to be invalid or unenforceable, the remainder of this Agreement and application of such provision to other Persons or circumstances will be interpreted so as to reasonably effect the intent of the parties hereto. The parties further agree to replace such void or unenforceable provision of this Agreement with a valid and enforceable provision that will achieve, to the extent possible, the economic, business and other purposes of the void or unenforceable provision and to execute any amendment, consent or agreement deemed necessary or desirable by a party to effect such replacement.

Section 8.9Equitable Remedies. The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof in any federal or state court located in the State of Texas (as to which the parties agree to submit to jurisdiction for the purposes of such action), this being in addition to any other remedy to which they are entitled at law or in equity.]

Section 8.10Attorneys’ Fees. In connection with any litigation or a court proceeding arising out of this Agreement, the prevailing party shall be entitled to recover all costs incurred, including reasonable attorneys’ fees and legal assistants’ fees and costs whether incurred prior to trial, at trial or on appeal.

26

Section 8.11Notices. Any notice or demand which must or may be given under this Agreement or by law shall, except as otherwise provided, shall be in writing and shall be deemed to have been given (i) five (5) Business Days following sending by registered or certified mail, postage prepaid, (ii) when sent, if sent by facsimile, (iii) when delivered, if delivered personally to the intended recipient, and (iv) one (1) Business Day following sending by overnight delivery via a national courier service and, if each case, addressed to a party at the following address for such party.

(a) in the case of a notice to any Ashford Select Entity, at the following address and telecopy number:

Ashford Hospitality Select Limited Partnership

c/o Ashford Hospitality Advisors LLC

14185 Dallas Parkway, Suite 1100

Dallas, Texas 75254

Attention: Chief Operating Officer

Phone: (972) 496-9600

Fax: (972) 490-9605

(b) in the case of a notice to the Contributors, at the following address and telecopy number:

Ashford Hospitality Limited Partnership

c/o Ashford Hospitality Trust, Inc.

14185 Dallas Parkway, Suite 1100

Dallas, Texas 75254

Phone: (972) 490-9600

Fax: (972) 490-9605

(c) in each case, with a copy to:

Andrews Kurth LLP

1717 Main Street, Suite 1700

Dallas, TX 75201

Attention: Muriel C. McFarling

Section 8.12Computation of Time. Any time period provided for herein which shall end on a Saturday, Sunday or legal holiday shall extend to 5:00 p.m. of the next full Business Day. All times are Central Standard Time.

Section 8.13Survival. It is the express intention and agreement of the parties hereto that the representations, warranties and covenants of the Contributors and the Ashford Select Entities set forth in this Agreement shall survive the consummation of the transactions contemplated hereby as set forth in Section 7.5(b).

27

Section 8.14Time of the Essence. Time is of the essence with respect to all obligations of the Contributors, and the Ashford Select Entitles under this Agreement.

[Signature Pages to Follow]

28

IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement, or caused the Agreement to be duly executed on its behalf, as of the date first above written.

CONTRIBUTORS:

ASHFORD HOSPITALITY LIMITED PARTNERSHIP

By: Ashford OP General Partner LLC, its general partner

By: /s/ DAVID BROOKS

Name: David Brooks

Title: Vice President

ASHFORD CREDIT HOLDINGS LLC

By: /s/ DERIC EUBANKS

Name: Deric Eubanks

Title: President

[Signature Page to the Contribution Agreement]

ASHFORD SELECT ENTITIES:

ASHFORD HOSPITALITY SELECT, INC.

By: /s/ DAVID BROOKS

Name: David Brooks

Title: Chief Operating Officer and General Counsel

ASHFORD HOSPITALITY SELECT LIMITED PARTNERSHIP

By: Ashford OP Select General Partner LLC, its general partner

By: /s/ DAVID BROOKS

Name: David Brooks

Title: Vice President

[Signature Page to the Contribution Agreement]

Exhibit A

Properties

Property	Contributor	Contributed Entity	Contributed Interest	Assignee	Contributor’s Relationship with Contributed Interest and the Property
Courtyard Columbus, 3888 Mimosa Drive Columbus, IN Springhill Suites Linthium (BWI Airport), 899 Elkridge Landing Rd., BWI Airport, Maryland Residence Inn Las Vegas, 370 Hughes Center Drive Las Vegas, NV Springhill Suites Gaithersburg, 9715 Washingtonian Blvd. Gaithersburg, MD Springhill Suites Centreville, 5920 Trinity Parkway Centreville, VA	Ashford Trust OP	Ashford Pool B Junior Holder LLC	100% member interest	Ashford Select OP	Ashford Trust OP owns 100% of Ashford Pool B Junior Holder LLC which owns 100% of Ashford Pool B Junior Mezz LLC which owns 100% of Ashford Pool B Senior Mezz LLC which owns: (a) 100% of Ashford Pool B GP LLC, which owns a 0.5% GP interest in: •    Ashford Tipton Lakes LP, which owns 100% of the Courtyard Columbus, Indiana; •    Ashford BWI Airport LP, which owns 100% of the Springhill Suites Lithium (BWI Airport), Maryland; •    Ashford LV Hughes Center LP, which owns 100% of the Residence Inn Las Vegas, Nevada; •    Ashford Gaithersburg Limited Partnership, which owns 100% of the Springhill Suites Gaithersburg, Maryland; and •    Ashford Centerville Limited Partnership, which owns 100% of the Springhill Suites Centerville, Virginia; and (b) a 99.5% LP interest in: •    Ashford Tipton Lakes LP which owns 100% of the Courtyard Columbus, Indiana; •    Ashford BWI Airport LP, which owns 100% of the Springhill Suites Lithium (BWI Airport), Maryland; •    Ashford LV Hughes Center LP, which owns 100% of the Residence Inn Las Vegas, Nevada; •    Ashford Gaithersburg Limited Partnership, which owns 100% of the Springhill Suites Gaithersburg, Maryland; and •    Ashford Centerville Limited Partnership, which owns 100% of the Springhill Suites Centerville, Virginia.

Exhibit A-1

Property	Contributor	Contributed Entity	Contributed Interest	Assignee	Contributor’s Relationship with Contributed Interest and the Property
Courtyard Louisville, 819 Phillips Lane Louisville, KY Residence Inn Lake Buena Vista, 11420 Marbella Palms Ct. Orlando FL Courtyard Ft. Lauderdale, 2000 N. Commerce Parkway Ft. Lauderdale, FL	Ashford Trust OP	Ashford Pool C1 Junior Holder LLC	100% member interest	Ashford Select OP	Ashford Trust OP owns 100% of Ashford Pool C1 Junior Holder LLC, which owns 100% of Ashford Pool C1 Junior Mezz LLC, which owns 100% of Ashford Pool C1 Senior Mezz LLC, which owns: (a)    100% of Ashford Pool C1 GP LLC, which owns a 0.5% GP interest in: •    Ashford Louisville LP, which owns 100% of the Courtyard Louisville, Kentucky; and •    Ashford Buena Vista LP, which owns 100% of the Residence Inn Buena Vista, Florida; (b)    a 99.5% LP interest in: •    Ashford Louisville LP which owns 100% of the Courtyard Louisville, Kentucky; and •    Ashford Buena Vista LP, which owns 100% of the Residence Inn Buena Vista, Florida; and (c)    100% of Ashford FT. Lauderdale Weston I, LLC, 100% of Ashford Ft. Lauderdale Weston II, LLC and 100% of Ashford Ft. Lauderdale Weston III, LLC, which entities together own 100% of the Courtyard Ft. Lauderdale, Florida.

Exhibit A-2

Property	Contributor	Contributed Entity	Contributed Interest	Assignee	Contributor’s Relationship with Contributed Interest and the Property
Residence Inn Orlando (Sea World), 11000 Westwood Blvd. Orlando, FL Residence Inn Salt Lake City, 6425 South 3000 East Cottonwood, UT Courtyard Overland Park, 11001 Woodson Street I-435 and Nall Overland Park, KS	Ashford Credit Holding LLC	Ashford Six General Partner LLC	100% member interest	Ashford Select OP	Ashford Credit Holding LLC owns 100% of Ashford Six General Partner LLC, which owns a 0.5% GP interest in the following: •    Ashford Orlando Sea World Limited Partnership, which owns 100% of the Residence Inn Orlando (Sea World), Florida; •    Ashford Salt Lake Limited Partnership, which owns 100% of the Residence Inn, Salt Lake City, Utah; and •    Ashford Overland Park Limited Partnership, which owns 100% of the Courtyard, Overland Park, Kansas.
	Ashford Credit Holding LLC	Ashford Orlando Sea World Limited Partnership Ashford Salt Lake Limited Partnership Ashford Overland Park Limited Partnership	99.5% limited partner interest	Ashford Select OP	Ashford Credit Holding LLC owns a 95.5% LP interest in the following: •    Ashford Orlando Sea World Limited Partnership, which owns 100% of the Residence Inn Orlando (Sea World); •    Ashford Salt Lake Limited Partnership, which owns 100% of the Residence Inn, Salt Lake City, Utah; and •    Ashford Overland Park Limited Partnership, which owns 100% of the Courtyard, Overland Park, Kansas.
Courtyard Palm Desert, 74895 Frank Sinatra Drive Palm Desert, CA Residence Inn, Palm Desert, 38305 Cook Street, Palm Desert, CA	Ashford Credit Holding LLC	Ashford Seven General Partner LLC	100% member interest	Ashford Select OP	Ashford Credit Holding LLC owns 100% of Ashford Seven General Partner LLC, which owns a 0.5% GP interest in Ashford Ruby Palm Desert I Limited Partnership, which owns 100% of Courtyard, Palm Desert, California and 100% of the Residence Inn Palm Desert, California.
	Ashford Credit Holding LLC	Ashford Ruby Palm Desert I Limited Partnership	99.5% limited partner interest	Ashford Select OP	Ashford Credit Holding LLC owns a 95.5% LP interest in Ashford Ruby Palm Desert I Limited Partnership, which owns 100% of the Courtyard Palm Desert, California, and 100% of the Residence Inn Palm Desert, California.

Exhibit A-3

Exhibit B

Formation Transactions

Exhibit B-1

Exhibit C

List of Subsidiaries of the Contributed Entities

Contributed Entities	Subsidiary Entities
Ashford Pool B Junior Holder LLC	Ashford Pool B Junior Mezz LLC Ashford Pool B Senior Mezz LLC Ashford Pool B GP LLC Ashford Tipton Lakes LP Ashford BWI Airport LP Ashford LV Hughes Center LP Ashford Gaithersburg Limited Partnership Ashford Centerville Limited Partnership
Ashford Pool C1 Junior Holder LLC	Ashford Pool C1 Junior Mezz LLC Ashford Pool C1 Senior Mezz LLC Ashford Pool C1 GP LLC Ashford Louisville LP Ashford Buena Vista LP Ashford Ft. Lauderdale Weston I LLC Ashford Ft. Lauderdale Weston II LLC Ashford Ft. Lauderdale Weston III LLC
Ashford Six General Partner LLC	Ashford Orlando Sea World Limited Partnership Ashford Salt Lake Limited Partnership Ashford Overland Park Limited Partnership
Ashford Orlando Sea World Limited Partnership	None
Ashford Salt Lake Limited Partnership	None
Ashford Overland Park Limited Partnership	None
Ashford Seven General Partner LLC	Ashford Ruby Palm Desert I Limited Partnership
Ashford Ruby Palm Desert I Limited Partnership	None

Exhibit C-1

Exhibit D

Form of Assignment and Assumption Agreement

Exhibit D-1

SCHEDULE 4.15

Existing Loans

1. Loan in the original principal amount of $54,900,000 made by Bank of America, N.A., as lender, to Ashford Overland Park Limited Partnership, Ashford Orlando Sea World Limited Partnership and Ashford Salt Lake Limited Partnership, on January 2, 2015, with respect to the Courtyard Overland Park, Overland Park, Kansas, Residence Inn Orlando Sea World, Orlando, Florida and Residence Inn Cottonwood, Salt Lake City, Utah.

2. Loan in the original principal amount of $24,500,000 made by Bank of America, N.A., as lender, to Ashford Ruby Palm Desert I Limited Partnership, on January 2, 2015, with respect to the Courtyard Palm Desert, California and the Residence Inn Palm Desert, California.

3. Loan in the original principal amount of $67,520,000 made by Morgan Stanley Bank, N.A., as lender to Ashford Louisville LP, Ashford Buena Vista LP, Ashford Ft. Lauderdale Weston I LP, Ashford Ft. Lauderdale Weston II LP, and Ashford Ft. Lauderdale Weston III LP, as borrower, on July 25, 2014, with respect to the Courtyard Louisville, Residence Inn Buena Vista and Courtyard Ft. Lauderdale, as amended to change the principal amount to $59,080,000.

4. Loan in the original principal amount of $8,440,000 made by Morgan Stanley Bank, N.A., as lender to Ashford Pool C1 Senior Mezz LLC, on August 24, 2014.

5. Loan in the original principal amount of $39,525,000 made by Morgan Stanley Bank, N.A., as lender to Ashford Gaithersburg Limited Partnership, Ashford Centerville Limited Partnership, Ashford Tipton Lakes LP, Ashford LV Hughes Center LP and Ashford BWI Airport LP, as borrower, on July 25, 2014, with respect to the Courtyard Columbus, Indiana, Springhill Suites BWI, Maryland, Residence Inn Las Vegas, Nevada, Springhill Suites Gaithersburg, Virginia and Springhill Suites Centreville, Virginia, to change the principal amount to $48,500,000.

6. Loan in the original principal amount of $11,000,000 made by Morgan Stanley Bank, N.A. as lender to Ashford Pool B Senior Mezz LLC, as borrower, on July 25, 2014, as amended to change the principal amount to $2,025,000.

7. Loan in the original principal amount of $12,375,000 made by Morgan Stanley Bank, N.A. as lender to Ashford Pool B Junior Mezz LLC, as borrower, on July 25, 2014.

Schedule 4.15 - 1

SCHEDULE 7.1

Retained Ashford Trust Guaranteed Obligations

1. Franchise Agreement with respect to Courtyard by Marriott located at 819 Phillips Lane, Louisville, Kentucky, dated September 2, 2004, between Marriott International, Inc. and Ashford TRS Pool C1 LLC, as amended.

2. Franchise Agreement with respect to Residence Inn by Marriott located at 11450 Marbella Palms Court, Orlando, Florida, dated September 2, 2004, between Marriott International, Inc. and Ashford TRS Pool C1 LLC, as amended.

3. Management Agreement with respect to Courtyard Weston/Ft. Lauderdale, Florida dated June 17, 2005, between Courtyard Management Corporation and Ashford TRS Lessee III LLC, as assigned to Ashford TRS Pool C1 LLC, as amended.

4. Franchise Agreement with respect to Courtyard by Marriott located at 74895 Frank Sinatra Drive, Palm Desert, California, dated June 1, 2013, between MIF, L.L.C. and Ashford TRS Lessee I LLC, as assigned to Ashford TRS Seven LLC, as amended.

5. Franchise Agreement with respect to Residence Inn by Marriott located at 38305 Cook Street, Palm Desert, California, dated June 1, 2013, between MIF, L.L.C. and Ashford TRS Lessee I LLC, as assigned to Ashford TRS Seven LLC, as amended.

6. Management Agreement with respect to Courtyard Kansas City Overland Park/Convention Center dated June 17, 2005, between Courtyard Management Corporation and Ashford TRS Lessee I LLC, as assigned to Ashford TRS Six LLC.

7. Management Agreement with respect to Residence Inn Salt Lake City Cottonwood dated June 17, 2005, between Residence Inn by Marriott, LLC and Ashford TRS Lessee I LLC, as assigned to Ashford TRS Six LLC.

8. Management Agreement with respect to Residence Inn Orlando Sea World/International Center dated June 17, 2005, between Residence Inn by Marriott, LLC and Ashford TRS Lessee I LLC, as assigned to Ashford TRS Six LLC.

9. Franchise Agreement with respect to SpringHill Suites by Marriott located at 899 Elkridge Landing Road, Linthicum, Maryland, dated May 17, 2004, between Marriott International, Inc. and Ashford TRS Pool B LLC, as amended.

10. Franchise Agreement with respect to Courtyard by Marriott located at 3888 Mimosa Drive, Columbus, Indiana, dated September 2, 2004, between Marriott International, Inc. and Ashford TRS Pool B LLC, as amended.

11. Management Agreement with respect to SpringHill Suites located in Gaithersburg, Maryland, dated June 17, 2005, between Springhill SMC Corporation and Ashford TRS Pool B LLC, as amended.

Schedule 7.1 - 1

12. Management Agreement with respect to SpringHill Suites located in Centreville, Virginia, dated June 17, 2005, between Springhill SMC Corporation and Ashford TRS Pool B LLC, as amended.

13. Amended and Restated Management Agreement with respect to Residence Inn (Hughes Center) located in Las Vegas, Nevada, dated January 4, 2003, between Residence Inn by Marriott, Inc. and Ashford TRS Pool B LLC.

Exhibit 7.1-2

EX-10.2.1

EXHIBIT 10.2.1

May 8, 2015    

Ashford Credit Holdings LLC

14185 Dallas Parkway, Suite 1100

Dallas, TX 75254

Ashford Hospitality Limited Partnership

14185 Dallas Parkway, Suite 1100

Dallas, TX 75254

Ladies and Gentlemen:

Reference is made to that certain Contribution Agreement (the “Agreement”), dated as of February 18, 2015, by and between Ashford Hospitality Select, Inc., Ashford Hospitality Select Limited Partnership, Ashford Credit Holdings LLC and Ashford Hospitality Limited Partnership. Capitalized terms not otherwise defined in this letter have the meanings assigned in the Agreement.

The undersigned hereby notify you, pursuant to Section 2.3 of the Agreement, that the Agreement is terminated and of no further force and effect.

Very truly yours,

ASHFORD HOSPITALITY SELECT LIMITED PARTNERSHIP

By: Ashford OP Select General Partner LLC, its general partner

By: /s/ DAVID BROOKS

Name: David Brooks

Title: Vice President

EX-10.3

EXHIBIT 10.3

PURCHASE AND SALE AGREEMENT

BY AND BETWEEN

ASHFORD TRS VI CORPORATION,

a Delaware corporation

ASHFORD HOSPITALITY SELECT, INC.,

a Maryland corporation

and

ASHFORD HOSPITALITY SELECT LIMITED PARTNERSHIP,

a Delaware limited partnership

February 18, 2015

TABLE OF CONTENTS

Page

ARTICLE I BASIC TRANSACTION1

Section 1.1Basic Transaction1

Section 1.2Consideration2

Section 1.3Omitted.2

Section 1.4Further Action2

ARTICLE II CLOSING PROCEDURES3

Section 2.1Conditions to Closing3

Section 2.2Documents to be Delivered at Closing4

Section 2.3Termination of the Offering6

Section 2.4Effect of Termination6

Section 2.5Closing Costs6

Section 2.6Tax Withholding6

ARTICLE III REPRESENTATIONS AND WARRANTIES OF ASHFORD SELECT ENTITIES 6

Section 3.1Organization of the Ashford Select Entities6

Section 3.2Authority6

Section 3.3Noncontravention6

Section 3.4Litigation7

Section 3.5Limited Activities7

Section 3.6No Other Representations and Warranties7

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF SELLER7

Section 4.1Organization of Seller, Purchased Entity and Subsidiary Entities7

Section 4.2Authorization of Transaction7

Section 4.3Authority to Conduct Business8

Section 4.4Noncontravention8

Section 4.5No Encumbrances8

Section 4.6No Other Agreements to Sell9

Section 4.7Title to Assets9

Section 4.8Compliance With Laws9

Section 4.9Licenses and Permits9

Section 4.10Environmental Matters10

Section 4.11Taxes10

i

Section 4.12Litigation10

Section 4.13No Insolvency Proceedings10

Section 4.14Existing Loan10

Section 4.15Material Documents11

Section 4.16No Other Representations and Warranties11

ARTICLE V COVENANTS11

Section 5.1Covenants of Seller11

Section 5.2Commercially Reasonable Efforts12

Section 5.3Covenants of the Ashford Select Entities.12

ARTICLE VI TAX MATTERS13

Section 6.1Tax Returns13

Section 6.2Cooperation14

Section 6.3Transfer Taxes14

Section 6.4Tax Contests14

ARTICLE VII INDEMNITY OBLIGATIONS 15

Section 7.1Indemnity15

Section 7.2Notice of Claims17

Section 7.3Third Party Claims17

Section 7.4Procedure for Indemnification17

Section 7.5Expiration18

Section 7.6Limitations on Indemnification18

Section 7.7Exclusive Remedy18

ARTICLE VIII GENERAL PROVISIONS18

Section 8.1Additional Definitions18

Section 8.2Tax Agreement20

Section 8.3Amendment20

Section 8.4Entire Agreement; Counterparts; Applicable Law20

Section 8.5Assignability20

Section 8.6Titles20

Section 8.7Third Party Beneficiary20

Section 8.8Severability20

Section 8.9Equitable Remedies20

Section 8.10Attorneys’ Fees21

ii

Section 8.11Notices21

Section 8.12Computation of Time21

Section 8.13Survival22

Section 8.14Time of the Essence22

iii

List of Schedules and Exhibits

Exhibits

Exhibit A – Property and Ownership Table

Exhibit B - Formation Transactions

Exhibit C - List of Subsidiaries Entities

Exhibit D - Form of Assignment and Assumption Agreement

Schedules

Schedule 4.14 – Existing Loan

Schedule 7.1 – Retained Ashford Trust Guaranteed Obligations

iv

PURCHASE AND SALE AGREEMENT

THIS PURCHASE AND SALE AGREEMENT (this “Agreement”) is executed as of this 18th day of February, 2015 by and between ASHFORD TRS VI CORPORATION, a Delaware corporation (“ASHFORD TRS VI”, and also referred to herein as “Seller”), ASHFORD HOSPITALITY SELECT, INC., a Maryland corporation (“Ashford Select”), and ASHFORD HOSPITALITY SELECT LIMITED PARTNERSHIP, a Delaware limited partnership (“Ashford Select OP”, and together with Ashford Select, the “Ashford Select Entities”).

WHEREAS, the Seller owns the equity interest (the “Equity Interest”) set forth on Exhibit A in the entity (the “Purchased Entity”) set forth on Exhibit A hereto, which Purchased Entity directly or indirectly owns the hotel property (the “Property”) identified on Exhibit A;

WHEREAS, the Seller desires to sell the Equity Interest in the Purchased Entity and Ashford Select OP desires to acquire the Equity Interest in the Purchased Entity from Seller;

WHEREAS, the transactions contemplated by this Agreement and certain other structuring transactions to be completed prior to or on the Closing Date as set forth on Exhibit B (collectively the “Formation Transactions”) are in connection with a proposed private placement (the “Offering”) of Ashford Select Class A common stock.

NOW, THEREFORE, in consideration of the foregoing, the representations, warranties, covenants and other terms and the mutual covenants and conditions set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Seller and the Ashford Select Entities agree as follows:

ARTICLE IBASIC TRANSACTION

Section 1.1Basic Transaction.

(a)Upon and subject to the terms and conditions contained in this Agreement, at the Closing (as hereinafter defined), Seller shall sell, assign, set over and transfer, absolutely and unconditionally, to Ashford Select OP all of Seller’s right, title and interest in and to the Equity Interest, in each case, free and clear of all Encumbrances except as set forth in Section 4.5, in exchange for the consideration set forth in Section 1.2; and Ashford Select OP shall accept such assignment by Seller. From and after the Closing Date, Ashford Select OP shall be bound by terms of the organizational documents governing the Purchased Entity and shall undertake, assume punctually and faithfully perform, pay or discharge when due and otherwise in accordance with their respective terms, all agreements, covenants, conditions, obligations and liabilities of Seller with respect to the Purchased Entity on or after the Closing Date. The “Closing Date” shall mean the date on which the Closing occurs, which shall be the same date as the closing of the Offering, unless otherwise agreed upon by the parties.

(b)This Agreement shall serve as notice to the partners, manager, or members, as the case may be, of the Purchased Entity of the transfer of Seller’s Equity Interest, and such partners, manager or members, as the case may be, of the Purchased Entity consents to, and agrees and acknowledges that all requirements and conditions for such transfer and the admission of Ashford Select OP as a substituted partner or member have been satisfied or otherwise waived in accordance with the terms of the organizational documents governing Seller’s Equity Interest.

(c)All of the parties hereto agree that, as a result of the assignment and assumption hereunder, for purposes of the organizational documents governing Seller’s Equity Interest, Ashford Select OP shall be a substituted limited partner or member, as the case may be, of the Purchased Entity.

Section 1.2Consideration.

(a)Closing Consideration. At the Closing, and subject to the terms and subject to the conditions set forth in this Agreement, as consideration for the sale by Seller of the Equity Interest, Ashford Select OP agrees to pay to Seller total consideration of $17,771,822 (the “Purchase Price”), payable as follows:

(i)A cash sum of $7,109,270; and

(ii)assumption of $10,662,552 in existing debt secured by the Property;

(b)Post-Closing Adjustments. At the Closing, Seller will receive a credit to the cash portion of the Purchase Price in an amount equal to the net working capital (i.e., Seller’s working capital assets less working capital liabilities (including, Taxes for the current tax

2

year) of the Property as of the Closing Date, including, without limitation, capital and FF&E reserves, Tax reserves or other cash amounts or reserves held by or on behalf of Seller. For a period of six (6) months following the Closing Date (or such longer period in order to obtain current year real estate and personal property tax bills, if applicable), the parties shall work together in good faith to true-up the credit provided in this Section 1.2(b).

Section 1.3Omitted.

Section 1.4Further Action. If, at any time after the Closing Date, Ashford Select OP shall determine or be advised that any deeds, bills of sale, assignments (including intellectual property assignments), certificates, affidavits, consents, assurances or other actions or items are necessary or desirable to vest, perfect or confirm of record or otherwise transfer the right, title or interest in or to the Equity Interest sold by Seller to Ashford Select OP and all rights and privileges associated with the Property, Seller shall execute and deliver all such deeds, bills of sale, assignments (including any intellectual property assignments), certificates, affidavits, consents, and assurances and take and do all such other actions and things as may be necessary or desirable to vest, perfect or confirm any and all right, title and interest in or to the Equity Interest or otherwise to carry out this Agreement; provided, that Seller shall not be obligated to take any action or execute any document if the additional actions or documents impose additional liabilities, obligations, covenants, responsibilities, representations or warranties on Seller that are material in nature and are not contemplated by this Agreement or reasonably inferable by the terms hereof.

ARTICLE IICLOSING PROCEDURES

Section 2.1Conditions to Closing.

(c)Conditions to Each Party’s Obligations. The obligation of each party to effect the sale contemplated by this Agreement and to consummate the other transactions contemplated hereby on the Closing is subject to the satisfaction or written waiver of the following conditions:

(i)The closing of the Offering shall have occurred prior to or simultaneously with the closing of the transactions contemplated hereby.

(ii)The Formation Transactions shall have been consummated not later than the Closing Date.

(iii)All consents and approvals of Governmental Authorities or third parties, including the waiver of any applicable right of first offer or right of first refusal with respect to the Equity Interest or the Property and any consent or approval required under any Existing Loan Documents (as hereinafter defined), necessary for the parties hereto to consummate the transactions contemplated hereby (except for those the absence of which would not have a material adverse effect on the ability of any party hereto to consummate the transactions contemplated by this Agreement) shall have been obtained or waived in writing.

3

(iv)No Governmental Authority shall have enacted, issued, promulgated, enforced or entered any statute, rule, regulation, executive order, decree, judgment, injunction or other Order (whether temporary, preliminary or permanent), in any case which is in effect and which prevents or prohibits consummation of any of the transactions contemplated in this Agreement nor shall any of the same brought by a Government Authority of competent jurisdiction be pending that seeks the foregoing.

(d)Conditions to Obligations of the Ashford Select Entities. The obligations of the Ashford Select Entities are further subject to the satisfaction of the following conditions (any of which may be waived in writing by the Ashford Select Entities in whole or in part):

(i)Except as would not have a material adverse effect on the business of the Ashford Select Entities, the Purchased Entity or any subsidiary of the Purchased Entity listed on Exhibit C (each, a “Subsidiary Entity”) or the Property, the representations and warranties of Seller contained in this Agreement shall be true and correct as of the Closing Date (except to the extent that any such representation or warranty speaks as of an earlier date, in which case it must be true and correct only as of such earlier date). This Section 2.1(b)(i) shall in no way limit, and shall be subject to, the provisions of Section 7.1.

(ii)Seller shall have executed and delivered each of the closing documents identified in Section 2.2(a) to the Ashford Select Entities, along with any other agreements or instruments reasonably necessary to consummate the transfer of the Equity Interest to Ashford Select OP (collectively, the “Seller Closing Documents”).

(e)Conditions to the Obligations of Seller. The obligations of Seller are further subject to the satisfaction of the following conditions (any of which may be waived in writing by Seller in whole or in part):

(i)Except as would not have a material adverse effect on the business of Seller, the representations and warranties of the Ashford Select Entities contained in this Agreement shall be true and correct as of the Closing Date (except to the extent that any such representation or warranty speaks as of an earlier date, in which case it must be true and correct only as of such earlier date).

(ii)The applicable Ashford Select Entities shall have executed and delivered each of the closing documents identified in Section 2.2(b) to Seller, along with any other agreements or instruments reasonably necessary to consummate the transfer of the Purchase Price to Seller (collectively, the “Ashford Select Closing Documents”).

Section 2.2Documents to be Delivered at Closing.

(a)Seller Closing Documents. On the Closing Date, Seller shall execute, acknowledge where deemed desirable or necessary by the Ashford Select Entities, and

4

deliver to the Ashford Select Entities, in addition to any other documents mentioned elsewhere herein, the following Seller Closing Documents:

(i)An assignment, assumption and admission agreement (“Assignment Agreement”)substantially in the form of Exhibit F attached hereto executed by Seller, assigning the Equity Interest of such Purchased Entity held by Seller to Ashford Select OP with Purchased Entity acknowledging the admission of Ashford Select OP as the successor to Seller’s Equity Interest in the Purchased Entity and further acknowledging the admission of Ashford Select OP as a partner or member of such Purchased Entity.

(ii)A closing certificate which shall be in a form satisfactory to the Ashford Select Entities and which shall reaffirm (subject to Section 2.1(b)(i)), the accuracy of all representations and warranties in all material respects and the satisfaction in all material respects of all covenants made by Seller in Articles IV and V hereof.

(iii)A certified copy of all corporate resolutions, consents or partnership actions authorizing the execution, delivery and performance by Seller of this Agreement and the Seller Closing Documents.

(iv)True, correct and complete copies of all organizational documents of the Purchased Entity and each Subsidiary Entity.

(v)An affidavit certifying that neither Seller nor the Purchased Entity or any Subsidiary Entity is a “foreign person”, as that term is defined by Section 1445 of the Code.

(vi)All documents required by any lender, manager or franchisor in connection with the transfer of the Equity Interest by Seller.

(vii)All leases, management agreements, book and records, service contracts and other material documents relating to the operation of the Properties.

(viii)Any other documents reasonably necessary to assign, transfer and convey the Equity Interest and effectuate the transactions contemplated hereby.

(b)Ashford Select Closing Documents. On the Closing Date, the Ashford Select Entities shall execute, acknowledge where deemed desirable or necessary by Seller, and deliver to Seller, (or cause to be executed, acknowledged or delivered) in addition to any other documents mentioned elsewhere herein, the following Ashford Select Closing Documents:

(v)A closing certificate which shall be in a form satisfactory to Seller and which shall reaffirm (subject to Section 2.1(c)(i)), the accuracy of all representations and warranties in all material respects and the satisfaction in all

5

material respects of all covenants made by the Ashford Select Entities in Articles III and V hereof.

(vi)A certified copy of all appropriate corporate resolutions or partnership actions authorizing the execution, delivery and performance by the Ashford Select Entities of this Agreement and the Ashford Select Closing Documents.

(vii)An executed counterpart to the Assignment Agreement.

(viii)All documents required by any lender, manager or franchisor in connection with the transfer of the Equity Interest, including the Replacement Guarantees (as hereinafter defined).

(ix)Any other documents reasonably necessary to assign, transfer and convey the Purchase Price to Seller and effectuate the transactions contemplated hereby.

Section 2.3Termination of the Offering.

(a)If at any time the Ashford Select Entities or the placement agent for the Offering determine in good faith to terminate the Offering, Ashford Select OP will so advise Seller in writing, whereupon this Agreement shall terminate effective as of the date such notice is delivered.

Section 2.4Effect of Termination. In the event of termination of this Agreement for any reason, all obligations on the part of all parties to this Agreement shall terminate, except as otherwise provided herein.

Section 2.5Closing Costs. Ashford Select OP shall pay and/or reimburse Seller for all of the closing costs, third party fees and third party expenses, including, but not limited to, banking fees, accounting fees, legal fees, assumption fees, transfer taxes and any other costs and expenses of Seller arising from the transfer of the Equity Interest pursuant to this Agreement (collectively, “Closing Costs”), excluding any income Tax liability incurred by Seller in connection therewith.

Section 2.6Tax Withholding. Ashford Select OP shall be entitled to deduct and withhold, from the Purchase Price payable pursuant to this Agreement to Seller, such amounts as Ashford Select OP is required to deduct and withhold with respect to the making of such payment under the Code or any provision of state, local or foreign Tax Law. To the extent that amounts are so withheld, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the Seller.

ARTICLE IIIREPRESENTATIONS AND WARRANTIES OF ASHFORD SELECT ENTITIES

As a material inducement to Seller to enter into this Agreement and to consummate the transactions contemplated hereby, the Ashford Select Entities hereby makes to Seller each of the representations and warranties set forth in this Article III.

6

Section 3.1Organization of the Ashford Select Entities. Each Ashford Select Entity is duly organized, validly existing and in good standing under the laws of the jurisdiction of such entity’s organization.

Section 3.2Authority. Each Ashford Select Entity has full right, authority, power and capacity to: (i) enter into this Agreement and each agreement, document and instrument to be executed and delivered by or on behalf of it pursuant to this Agreement, including without limitation, the Ashford Select Closing Documents; and (ii) carry out the transactions contemplated hereby and thereby. This Agreement and each agreement, document and instrument executed and delivered by any Ashford Select Entity pursuant to this Agreement constitutes, or when executed and delivered will constitute, the legal, valid and binding obligation of such Ashford Select Entity, each enforceable in accordance with its respective terms.

Section 3.3Noncontravention. The execution, delivery and performance of this Agreement and each such agreement, document and instrument by each Ashford Select Entity: (A) does not and will not violate the organizational documents of the Ashford Select Entities; (B) does not and will not violate any foreign, federal, state, local or other Law applicable to the Ashford Select Entities, or require the Ashford Select Entities to obtain any approval, consent or waiver of, or make any filing with, any Person or authority (governmental or otherwise) that has not been obtained or made (or will not have been obtained or made on or before the Closing) or which does not remain in effect; and (C) does not and will not result in a breach of, constitute a default under, accelerate any obligation under or give rise to a right of termination of, any indenture or loan or credit agreement or any other agreement, contract, instrument, mortgage, Lien, lease, permit, authorization, Order, writ, judgment, injunction, decree, determination or arbitration award to which any Ashford Select Entity is a party or by which the property of the Ashford Select Entity is bound or affected, in the case of each of (A), (B) and (C), in any manner that challenges or would reasonably be expected to impair the ability of the Ashford Select Entities to execute or deliver or materially perform its obligations under this Agreement and the documents executed by it pursuant to this Agreement or to consummate the transactions contemplated hereby or thereby.

Section 3.4Litigation. There is no action, suit or proceeding pending or, to the knowledge of the Ashford Select Entities, threatened against the Ashford Select Entities, that challenges or would reasonably be expected to impair the ability of the Ashford Select Entities to execute or deliver or materially perform its obligations under this Agreement and the documents executed by it pursuant to this Agreement or to consummate the transactions contemplated hereby or thereby.

Section 3.5Limited Activities. Except for activities in connection with the Offering, the Formation Transactions or in the ordinary course of business, the Ashford Select Entities have not engaged in any material business or incurred any material obligations.

Section 3.6No Other Representations and Warranties. Other than the representations and warranties expressly set forth in this Article III, the Ashford Select Entities shall not be deemed to have made any other representation or warranty in connection with this Agreement or the transactions contemplated hereby.

7

ARTICLE IVREPRESENTATIONS AND WARRANTIES OF SELLER

As a material inducement to the Ashford Select Entities to enter into Agreement and to consummate the transactions contemplated hereby, Seller hereby makes to the Ashford Select Entities each of the representations and warranties set forth in this Article IV.

Section 4.1Organization of Seller, Purchased Entity and Subsidiary Entities. Seller, Purchased Entity and each Subsidiary Entity is duly organized, validly existing and in good standing under the laws of the respective jurisdiction of such entity’s organization, and is qualified to do business in each jurisdiction in which the operation of its business makes such qualification necessary or desirable.

Section 4.2Authorization of Transaction. Subject to the receipt of third-party consents (or waivers) as required as a condition to closing pursuant to Section 2.1(a)(iii), Seller has full right, authority, power and capacity to: (i) enter into this Agreement and each agreement, document and instrument to be executed and delivered by or on behalf of Seller pursuant to this Agreement, including, without limitation, the Seller Closing Documents; (ii) carry out the transactions contemplated hereby and thereby; and (iii) transfer, sell and deliver the Equity Interest to Ashford Select OP upon payment therefor in accordance with this Agreement. This Agreement and each agreement, document and instrument executed and delivered by or on behalf of Seller pursuant to this Agreement constitutes, or when executed and delivered will constitute, the legal, valid and binding obligation of Seller, each enforceable in accordance with its respective terms.

Section 4.3Authority to Conduct Business. Purchased Entity and each Subsidiary Entity is duly authorized to conduct business and is in good standing under the laws of each jurisdiction where such qualification is required. Purchased Entity and each Subsidiary Entity has full power and authority and all licenses, permits, and authorizations necessary to carry on the businesses in which it is engaged and to own and use the property owned and used by it. Seller has delivered, or has caused to be delivered, to the Ashford Select Entities correct and complete copies of the partnership or limited liability company agreement, as applicable, of Purchased Entity and each Subsidiary Entity, as amended to date (each, an “Operating Agreement”). Neither the Purchased Entity nor any Subsidiary Entity is in default under or in violation of any provision of its Operating Agreement.

Section 4.4Noncontravention. Subject to the receipt of third-party consents (or waivers) as required as a condition to Closing pursuant to Section 2.1(a)(iii), the execution, delivery and performance of this Agreement and each additional agreement, document and instrument to be executed and delivered by or on behalf of Seller pursuant to this Agreement, including, without limitation, the Seller Closing Documents: (A) does not and will not violate the Operating Agreement of the Purchased Entity, any Subsidiary Entity or Seller’s partnership agreement, limited liability agreement or bylaws, as applicable; (B) does not and will not violate any foreign, federal, state, local or other Law applicable to the Purchased Entity or Seller, or require the Purchased Entity or Seller to obtain any approval, consent or waiver of, or make any filing with, any Person or authority (governmental or otherwise) that has not been obtained or made or which does not remain in effect; and (C) does not and will not result in a breach of, constitute a default under, accelerate any obligation

8

under or give rise to a right of termination of, any indenture or loan or credit agreement or any other agreement, contract, instrument, mortgage, Lien, lease, permit, authorization, Order, writ, judgment, injunction, decree, determination or arbitration award to which the Purchased Entity, any Subsidiary Entity or Seller is a party or by which the property of the Purchased Entity, any Subsidiary Entity or Seller is bound or affected, or result in the creation of any Encumbrance on the Purchased Entity, any Subsidiary Entity or the Equity Interest of Seller.

Section 4.5No Encumbrances. As of the Closing Date, Seller will be the beneficial and record holder of the Equity Interest, and indirectly, the Subsidiary Entities, free and clear of any restrictions on transfer (other than any restrictions under the Securities Act of 1933, as amended (the “Securities Act”) or the securities laws of any state (“Blue Sky Laws”)), claim, Lien, pledge, voting agreement, option, charge, security interest, mortgage, deed of trust, encumbrance, rights of assignment, purchase rights or other rights of any nature whatsoever of any third party (collectively, “Encumbrances”) other than Liens created by the Existing Loan, and as of the Closing Date, will have the full power and authority to convey the Equity Interest free and clear of any Encumbrances, and upon delivery of the Assignment Agreement by Seller conveying the Equity Interest and receipt by Seller of the Purchase Price as herein provided, Ashford Select OP will acquire good and valid title thereto, free and clear of all Encumbrances. Seller owns, directly or indirectly, one hundred percent (100%) of the partnership or membership interests, as applicable, in the Purchased Entity, and Exhibit A is true, correct and complete. The Equity Interest has been duly authorized and validly issued, is fully paid and non-assessable, and there is no requirement for any additional capital contributions to the Purchased Entity or any Subsidiary Entities. The Purchased Entity has not issued any outstanding partnership, LLC membership or other equity ownership interests and the Purchased Entity has no outstanding options, warrants, convertible securities, calls, rights, commitments, preemptive rights, agreements, arrangements or understanding of any character obligating the Purchased Entity to (i) issue, deliver or sell, or cause to be issued, delivered or sold, additional equity ownership interests in the Purchased Entity or any securities or obligations convertible into or exchangeable for ownership interests in the Purchased Entity; or (ii) grant, extend or enter into any such option, warrant, convertible security, call, right, commitment, preemptive right, agreement, arrangement or understanding.

Section 4.6No Other Agreements to Sell. Seller represents that it has made no agreement with, and will not enter into any agreement with, and has no obligation (absolute or contingent) to, any other Person or firm to sell, transfer or in any way encumber the Equity Interest or to not sell the Equity Interest, or to enter into any agreement with respect to a sale, transfer or Encumbrance of or put or call right with respect to the Equity Interest.

Section 4.7Title to Assets. The Purchased Entity or any Subsidiary Entity holding title to the Property (each, an “Owner”),has good and marketable or indefeasible fee simple title to the Property. The Property is free and clear of all Encumbrances other than the operating lease, management agreement, existing tenant leases, franchise agreement and all matters recorded in the real property records of the county where the Property is located and/or that would be shown on an accurate current survey of the Property. Neither the Purchased Entity nor any Subsidiary Entity owns nor has any interest in any assets or liabilities that is unrelated to the Property or the Existing Loan.

9

Section 4.8Compliance With Laws. The Purchased Entity and each Subsidiary Entity has conducted its business in compliance with all applicable Laws, except for such failures that would not, individually or in the aggregate, reasonably be expected to materially and adversely affect the condition, financial or otherwise, or the earnings or business affairs of the Purchased Entity, any Subsidiary Entity or the Property.

Section 4.9Licenses and Permits. The Purchased Entity and each Subsidiary Entity possesses such certificates, authorities or permits issued by the appropriate state or federal agencies or bodies necessary to conduct the business conducted by it except where failure to have any such certificates, authorities or permits would not have a material adverse effect on such entity. None of Seller, Purchased Entity or any Subsidiary Entity has received any written notice of proceedings relating to the revocation or modification or any such certificate, authority or permit which, singly or in the aggregate, if the subject of an unfavorable decision, ruling, or finding, would materially and adversely affect the condition, financial or otherwise, or the earnings or business affairs of the Purchased Entity, any Subsidiary Entity or the Property.

Section 4.10Environmental Matters. Except for matters disclosed in the most recent Phase I environmental reports delivered to Ashford Select OP, (a) to Seller’s knowledge, Seller, Purchased Entity and each Subsidiary Entity is in compliance with all Environmental Laws and (b) neither Seller, Purchased Entity nor any Subsidiary Entity has received any written notice from any Governmental Authority or third party alleging that Seller, Purchased Entity or any Subsidiary Entity is not in compliance with applicable Environmental Laws. The representations and warranties contained in this Section 4.10 constitute the sole and exclusive representations and warranties made by Seller concerning environmental matters.

Section 4.11Taxes. (i) All Taxes (including, but not limited to, real estate Taxes due and owing with respect to the Property and personal property Taxes) required to be paid by the Purchased Entity or Subsidiary Entity on or before the date hereof have been paid and all Tax Returns required to be filed on or before the date hereof (taking into account any extensions to file previously received) by or on behalf of the Purchased Entity or any Subsidiary Entity have been timely filed and such returns were true, correct and complete in all material respects when filed; and (ii) there is no action, suit or proceeding pending against or threatened with respect to the Purchased Entity, any Subsidiary Entity or the Property in respect of any Tax, nor is any claim for additional Tax asserted by the Purchased Entity or any Subsidiary Entity nor are any federal, state and local income or franchise Tax Returns of the Purchased Entity or any Subsidiary Entity the subject of any audit or examination by any taxing authority. Neither the Purchased Entity nor any Subsidiary Entity has executed or filed with the Internal Revenue Service or any other taxing authority any agreement now in effect extending the period for assessment or collection of any income or other Taxes.

Section 4.12Litigation. There is no action, suit or proceeding pending or, to the knowledge of Seller, threatened against the Purchased Entity or any Subsidiary Entity or that affects the Property, which if adversely determined, would reasonably be expected to have a material adverse effect on the condition, financial or otherwise, or the earnings or business affairs of the Purchased Entity, Subsidiary Entity or the Property. There is no action, suit, or proceeding pending or, to the knowledge of Seller, threatened against Seller which challenges or impairs the ability of Seller to execute or

10

deliver, or materially perform its obligations under this Agreement or to consummate the transactions hereby. Seller has not received notice of any condemnation or eminent domain proceeding.

Section 4.13No Insolvency Proceedings. No bankruptcy or similar insolvency proceeding has been filed, or is currently contemplated, with respect to Seller, the Purchased Entity or Subsidiary Entities.

Section 4.14Existing Loan. Schedule 4.14 sets forth a true, correct and complete list, as of the date hereof, of all loans presently encumbering the Property, Purchased Entity or any Subsidiary Entities that will exist at and after the closing (collectively, the “Existing Loan”), together with the outstanding balance of each such Existing Loan. Other than the outstanding balance set forth with respect to each Existing Loan on Schedule 4.14 and any accrued interest on the Existing Loan, there are no other amounts outstanding under any Existing Loan. No monetary default (beyond applicable notice and cure periods) by any party exists under any of the Existing Loan and the documents entered into in connection therewith (collectively, the “Existing Loan Documents”) and no material non-monetary default (beyond applicable notice and cure periods) by any party exists under any of such Existing Loan Documents. True, correct and complete copies of all Existing Loan Documents have been provided by Seller to the Ashford Select Parties.

Section 4.15Material Documents. (a) The organizational documents provided by or on behalf of the Seller to the Ashford Select Entities for each Purchased Entity and Subsidiary Entity are true, correct and complete and there are no other governing documents for such entities; (ii) the financial statements provided by or on behalf of the Seller to the Ashford Select Entities for each Purchased Entity, Subsidiary Entity and Property are true, correct and complete in all material respects and disclose all material liabilities, including all material contingent liabilities; and (iii) all leases, management agreements, book and records, service contracts and other material documents relating to the operation of the Properties provided by or on behalf of the Seller to the Ashford Select Entities are true, correct and complete in all material respects.

Section 4.16No Other Representations and Warranties. Other than the representations and warranties expressly set forth in this Article IV or in Seller Closing Documents, Seller shall not be deemed to have made any other representation or warranty in connection with this Agreement or the transactions contemplated hereby.

ARTICLE VCOVENANTS

Section 5.1Covenants of Seller. From the date hereof through the Closing Date, except as otherwise provided for or as contemplated by this Agreement, the Formation Transactions or the other agreements, documents and instruments contemplated hereby, Seller shall use commercially reasonable efforts to (and shall use commercially reasonable efforts to cause each of the Purchased Entity and Subsidiary Entities to conduct its business and operate and maintain the Property in the ordinary course of business consistent with past practice, pay debt obligations as they become due and payable (except as may be being contested in good faith and in a commercially prudent manner), and use commercially reasonable efforts to preserve intact current business organizations and preserve relationships with lenders and others having business dealings with it, in each case

11

consistent with past practice. From the date hereof through the Closing Date, except as otherwise provided for or as contemplated by this Agreement, the Formation Transactions or other agreements, documents and instruments contemplated hereby or thereby, Seller shall not:

(a)sell, transfer or otherwise dispose of all or any portion of the Equity Interest;

(b)(i) issue or authorize the issuance of any securities in respect of, in lieu of or in substitution for the Equity Interest or make any other changes to the equity capital structure of the Purchased Entity or the Subsidiary Entities, or (ii) purchase, redeem or otherwise acquire the Equity Interest;

(c)issue, deliver, sell, transfer, dispose, mortgage, pledge, assign or otherwise encumber, or cause the issuance, delivery, sale, transfer, disposition, mortgage, pledge, assignment or other encumbrance of, any limited liability company or partnership interests or other Equity Interest of the Purchased Entity or the Subsidiary Entities, the Property or other assets of the Purchased Entity or the Subsidiary Entities;

(d)amend, modify or terminate any lease, contract or other instruments relating to the Property, except on an arms-length basis, on market terms, and in the ordinary course of business consistent with past practice;

(e)take or omit to take any action to cause any Lien to attach to the Equity Interest, the equity interest in any Subsidiary Entity, or the Property, except for the Existing Loan;

(f)mortgage, pledge, hypothecate, encumber (or permit to become encumbered) all or any portion of the Equity Interest, the equity interest in any Subsidiary Entities or the Property, except for the Existing Loan;

(g)amend the operating or partnership agreement of the Purchased Entity or any Subsidiary Entity, except in connection with the Formation Transactions;

(h)materially alter the manner of keeping the books, accounts or records or the accounting practices therein reflected, of the Purchased Entity or any Subsidiary Entity, except in connection with the Formation Transactions;

(i)adopt a plan of liquidation, dissolution, merger, consolidation, restructuring, recapitalization or reorganization with respect to Seller, Purchased Entity or any Subsidiary Entity, except in connection with the Formation Transactions;

(j)violate or knowingly cause or permit the Purchased Entity or any Subsidiary Entity to violate in any material respect, or fail to use commercially reasonable efforts to cure any material violation of any Existing Loan Documents, the organizational documents of the Purchased Entity or Subsidiary Entities, or applicable Laws; or

(k)authorize, commit or agree to take any of the foregoing actions.

12

Section 5.2Commercially Reasonable Efforts. Seller and the Ashford Select Entities shall use commercially reasonable efforts and cooperate with each other in (a) promptly determining whether any filings are required to be made or consents, approvals, waivers, permits or authorizations are required to be obtained (under any applicable Law or regulation from any Governmental Authority or third party) in connection with the transactions contemplated by this Agreement and (b) promptly making any such filings, furnishing information required in connection therewith and timely seeking to obtain any such consents, approvals, waivers, permits or authorizations.

Section 5.3Covenants of the Ashford Select Entities.

(a)As used in this Section 5.3, “Existing Guarantees” means any (i) guaranty or environmental indemnity relating to the Existing Loan, or (ii) guaranty of any contractual obligations relating to any management agreement or franchise agreement of the Property, to which Ashford Hospitality Trust, Inc. (“Ashford Trust”), Ashford Hospitality Limited Partnership (“Ashford Trust OP”) or any of their Affiliates that is not the Purchased Entity or a Subsidiary Entity (collectively, an “Ashford Trust Guarantor”) is a party. Except for the Existing Guarantees relating to the management agreements and franchise agreements described on Schedule 7.1 attached hereto, effective as of the Closing Date, Ashford Select and/or Ashford Select OP shall become a party to the Existing Guarantees or enter into replacement guaranties or environmental indemnities, as applicable, in substantially the form of the Existing Guarantees (collectively, “Replacement Guarantees”) with respect to all obligations covered therein. The parties acknowledge and agree that (i) Ashford Trust Guarantor shall not be released as of the Closing Date from the Existing Guarantees as to contractual obligations arising from and after the Closing Date relating to the management agreements and franchise agreements described on Schedule 7.1 attached hereto (the “Retained Ashford Trust Guaranteed Obligations”), (ii) Ashford Select Entities shall not enter into Replacement Guarantees at Closing covering the Retained Ashford Trust Guaranteed Obligations, (iii) Ashford Select Entities agree that Ashford Select Entities will enter into Replacement Guarantees covering the Retained Ashford Trust Guaranteed Obligations at such time as the managers and/or franchisors agree to release Ashford Trust Guarantors from the Retained Ashford Trust Guaranteed Obligations, and (iv) Ashford Select Entities agree to indemnify and hold harmless Ashford Trust Guarantor with respect to the Retained Ashford Trust Guaranteed Obligations pursuant to Section 7.1(c) hereof.

ARTICLE VITAX MATTERS

Section 6.1Tax Returns. The following provisions shall govern the allocation of responsibility and payment of Taxes as between the Ashford Select Entities and Seller for certain Tax matters following the Closing Date:

(a)Seller shall prepare or cause to be prepared and file or cause to be filed, subject to the review and reasonable approval of the Ashford Select Entities, all Tax Returns for each of the Purchased Entity and Subsidiary Entities for all periods ending on or prior to the Closing Date that are required to be filed after the Closing Date. The Ashford Select Entities hereby recognize Seller’s authority to execute and file, on behalf of the Purchased

13

Entity and Subsidiary Entities, all such Tax Returns (and agrees to take all action necessary to ensure such authorization in conformity with applicable Law and principles of good governance generally). To the extent not otherwise paid by the Seller to the appropriate taxing authority, Seller shall reimburse the applicable Ashford Select Entity for Taxes of the Purchased Entity or Subsidiary Entity with respect to all such Tax Returns within fifteen (15) Business Days after payment by an Ashford Select Entity and/or the Purchased Entity or Subsidiary Entity of such Taxes. All such Tax Returns shall be prepared in a manner that is consistent with the past custom and practice of the Purchased Entity, except as required by a change in applicable Law.

(b)The Ashford Select Entities shall prepare or cause to be prepared and file or cause to be filed, subject to the review and reasonable approval of Seller, any Tax Returns of the Purchased Entity and any Subsidiary Entities for Tax periods which begin before the Closing Date and end after the Closing Date. The Seller shall pay to the applicable Ashford Select Entity, within fifteen (15) Business Days before the date on which Taxes are to be paid with respect to such periods, an amount equal to the portion of such Taxes which relates to the portion of such Tax period ending on the Closing Date. For purposes of this Section 6.1(b) and Section 7.1(b), in the case of any Taxes that are imposed on a periodic basis and are payable for a Tax period that includes (but does not end on) the Closing Date, the portion of such Tax which relates to the portion of such Tax period ending on the Closing Date shall (x) in the case of any Taxes other than Taxes based upon or related to income, gains or receipts (including sales and use taxes), or employment or payroll Taxes, be deemed to be the amount of such Tax for the entire Tax period multiplied by a fraction the numerator of which is the number of days in the Tax period ending on the Closing Date and the denominator of which is the number of days in the entire Tax period, and (y) in the case of any Tax based upon or related to income, gains or receipts (including sales and use taxes), or employment or payroll Taxes, be deemed equal to the amount which would be payable if the relevant Tax period ended on the Closing Date. Any credits relating to a Tax period that begins before and ends after the Closing Date shall be taken into account as though the relevant Tax period ended on the Closing Date. All determinations necessary to give effect to the foregoing allocations shall be made in a manner consistent with reasonable prior practice of the Purchased Entity or the Subsidiary Entities, as applicable.

(c)The Ashford Select Entities shall prepare and cause to be prepared and file or cause to be filed all other Tax Returns of any of the Purchased Entity or any Subsidiary Entities.

Section 6.2Cooperation. The Ashford Select Entities, each of the Purchased Entity, Subsidiary Entities and Seller agree to retain all books and records with respect to Tax matters pertinent to the Purchased Entity and Subsidiary Entities, and their respective assets or business relating to any taxable period beginning before the Closing Date until the expiration of the statute of limitations (and, to the extent notified by any Ashford Select Entity, any extensions thereof) of the respective Tax periods, and to abide by all record retention agreements entered into with any taxing authority. The Seller shall give the Ashford Select Entities reasonable written notice prior to transferring, destroying or discarding any such books and records and, if any Ashford Select Entity

14

so requests, Seller shall allow Ashford Select Entities to take possession of such books and records at such Ashford Select Entity’s expense.

Section 6.3Transfer Taxes. All sales, use and transfer taxes, bulk transfer taxes, deed taxes, conveyance fees, documentary and recording charges and similar taxes imposed as a result of the transactions contemplated by this Agreement, together with any interest, penalties or additions to such transfer taxes or attributable to any failure to comply with any requirement regarding Tax Returns (“Transfer Taxes”), shall be paid by the Ashford Select Entities. The Ashford Select Entities and Seller shall cooperate in filing all necessary Tax Returns under applicable Law with respect to Transfer Taxes.

Section 6.4Tax Contests. The Ashford Select Entities shall inform the Seller of the commencement of any audit, examination or proceeding (“Tax Contest”) relating in whole or in part to Taxes for which any Ashford Select Entity may be entitled to indemnity from Seller hereunder. With respect to any Tax Contest for which Seller acknowledges in writing that Seller is liable under Article VII for any and all Losses relating thereto, Seller shall be entitled to control, in good faith, all proceedings taken in connection with such Tax Contest; provided, however, that (x) Seller shall promptly notify the Ashford Select Entities in writing of any intention to control such Tax Contest, (y) in the case of a Tax Contest relating to Taxes of any of the Purchased Entity or Subsidiary Entities for a Tax period that includes but does not end on the Closing Date, the Seller and Ashford Select Entity shall jointly control all proceedings taken in connection with any such Tax Contest and (z) if any Tax Contest could reasonably be expected to have an adverse effect on any Ashford Select Entity, any of the Purchased Entity, Subsidiary Entities or any of their Affiliates in any Tax period beginning after the Closing Date, the Tax Contest shall not be settled or resolved without the relevant Ashford Select Entity consent, which consent shall not be unreasonably withheld or delayed. Notwithstanding the foregoing, if notice is given to Seller of the commencement of any Tax Contest and Seller does not, within ten (10) Business Days after notice is given by an Ashford Select Entity, give notice to such Ashford Select Entity of its election to assume the defense thereof (and in connection therewith, acknowledge in writing the indemnification obligation hereunder of Seller), Seller shall be bound by any determination made in such Tax Contest or any compromise or settlement thereof effected by the Ashford Select Entity. The failure of an Ashford Select Entity to give reasonably prompt notice of any Tax Contest shall not release, waive or otherwise affect Seller’s obligation with respect thereto except to the extent that Seller can demonstrate actual loss and prejudice as a result of such failure. The Ashford Select Entities and the Purchased Entity and Subsidiary Entities shall use their reasonable efforts to provide Seller with such assistance as may be reasonably requested by Seller in connection with a Tax Contest controlled solely or jointly by Seller.

ARTICLE VIIINDEMNITY OBLIGATIONS

Section 7.1Indemnity.

(b)From and after the Closing Date, each party hereto (each of which is an “Indemnifying Party”) shall indemnify and hold harmless the other party and its Affiliates (each of which is an “Indemnified Party”) from and against any and all charges, complaints,

15

claims, actions, causes of action, losses, damages, liabilities and expenses of any nature whatsoever (each, a “Claim”), including amounts paid in settlement, reasonable attorneys’ fees, costs of investigation, costs of investigative judicial or administrative proceedings or appeals therefrom and costs of attachment or similar bonds (collectively, “Losses”) arising out of or relating to, asserted against, imposed upon or incurred by the Indemnified Party in connection with or as a result of any breach of a representation, warranty or covenant of the Indemnifying Party contained in this Agreement or in any schedule, exhibit, certificate or affidavit or any other agreement, document or instrument delivered by the Indemnifying Party pursuant to this Agreement (to the extent not known by Indemnified Party prior to Closing Date). In addition (a) Ashford Select Entities shall jointly and severally indemnify Seller and hold it harmless from and against any Losses arising from the operation of the business of any Ashford Select Entity, the Purchased Entity or the Subsidiary Entities, or the ownership and operation of the assets of such entities for the period from and after the Closing, and (b) Seller shall indemnify Ashford Select Entities, the Purchased Entity and the Subsidiary Entities and hold them harmless from and against any Losses arising from the operation of the business of Seller, the Purchased Entity or the Subsidiary Entities, or the ownership and operation of the assets of such entities for the period prior to the Closing; provided, however, that: (i) the Ashford Select Entities shall not have any obligation under this Article to indemnify any Indemnified Party against any Losses to the extent that such Losses arise by virtue of Seller’s breach of this Agreement, gross negligence, willful misconduct or fraud; and (ii) no Seller shall have any obligation under this Article to indemnify any Indemnified Party against any Losses to the extent that such Losses arise by virtue of (A) any diminution in value of the Property, or (B) any Ashford Select Entity’s breach of this Agreement, gross negligence, willful misconduct or fraud; and

(c)(%3) Seller shall indemnify each of the Ashford Select Entities, the Purchased Entity and the Subsidiary Entities and hold them harmless from and against all Losses arising from: (A) all Taxes of the Purchased Entity, Subsidiary Entities and the Property for all Tax periods ending on or before the Closing Date, (B) with respect to any Tax period including but not ending on the Closing Date, all Taxes of the Purchased Entity, Subsidiary Entities and the Property attributable to the portion of such Tax period that ends on and includes the Closing Date, and (C) all Taxes of any Person imposed on the Purchased Entity or Subsidiary Entities as a transferee or successor, by contract or pursuant to any Law (including, but not limited to, Treasury Regulations Section 1.1502-6 and V.T.C.A., Tax Code, Chapter 171) with respect to obligations or relationships existing on or prior to the Closing Date or by agreements entered into or transactions entered into on or prior to the Closing Date.

(i)Seller shall have no liability for any Taxes or Losses with respect to Taxes that are attributable to any transaction outside the ordinary course of business of the Purchased Entity or Subsidiary Entities entered into by any Ashford Select Entity or its Affiliates or at the direction of any Ashford Select Entity or its Affiliates that occurs on or after the Closing.

16

(ii)Seller shall have no liability to any Ashford Select Entity for any Losses attributable to Taxes with respect to (A) any Tax period beginning after the Closing Date, or (B) any portion of a straddle period (a Tax period which includes but does not end on the Closing Date) beginning after the Closing Date.

(d)From and after the Closing Date, the Ashford Select Entities shall jointly and severally indemnify and hold harmless each Ashford Trust Guarantor from and against any and all Losses and Claims related to any Retained Ashford Trust Guaranteed Obligations, and such indemnification obligation shall continue until all debt or management or franchise obligations associated with the Retained Ashford Trust Guaranteed Obligations have been paid and satisfied in full or Ashford Trust Guarantor has been fully released from such Retained Ashford Trust Guaranteed Obligations. From and after the Closing Date, Ashford Trust Guarantor shall indemnify and hold harmless Ashford Select Entities from and against any and all Losses and Claims related to any Replacement Guaranties with respect to any liabilities covered thereunder that relate to the period prior to the Closing, and such indemnification obligation shall continue until all debt or management or franchise obligations associated therewith have been paid and satisfied in full or Ashford Select Entities have been fully released therefrom.

Section 7.2Notice of Claims. At the time when any Indemnified Party learns of any potential Claim against the Indemnifying Party it will promptly give written notice (a “Claim Notice”) to the Indemnifying Party; provided that failure to do so shall not prevent recovery under this Agreement, except to the extent that the Indemnifying Party shall have been materially prejudiced by such failure. Each Claim Notice shall describe in reasonable detail the facts known to such Indemnified Party giving rise to such Claim, and the amount or good faith estimate of the amount of Losses arising therefrom. Unless prohibited by Law, such Indemnified Party shall deliver to the Indemnifying Party, promptly after such Indemnified Party’s receipt thereof, copies of all notices and documents (including court papers) received by such Indemnified Party relating to claims asserted by third parties (“Third Party Claims”). Any Indemnified Party may at its option demand indemnity under this Article VII as soon as a Claim has been threatened by a third party, regardless of whether an actual Loss has been suffered, so long as such Indemnified Party shall in good faith determine that such claim is not frivolous and that such Indemnified Party may be liable for, or otherwise incur, a Loss as a result thereof.

Section 7.3Third Party Claims. The Indemnifying Party shall be entitled, at its own expense, to assume and control the defense of any Claims based on Third Party Claims, through counsel chosen by the Indemnifying Party and reasonably acceptable to such Indemnified Party (or any Person authorized by such Indemnified Party to act on its behalf), if it gives written notice of its intention to do so to such Indemnified Party within 30 days of the receipt of the applicable Claim Notice; provided, however, that such Indemnified Party may at all times participate in such defense at its expense. Without limiting the foregoing, in the event that the Indemnifying Party exercises the right to undertake any such defense against a Third Party Claim, such Indemnified Party shall cooperate with the Indemnifying Party in such defense and make available to the Indemnifying Party (unless prohibited by Law), at the Indemnifying Party’s expense, all witnesses, pertinent records, materials and information in such Indemnified Party’s possession or under such Indemnified

17

Party’s control relating thereto as is reasonably required by the Indemnifying Party. No compromise or settlement of such Third Party Claim may be effected by either such Indemnified Party, on the one hand, or the Indemnifying Party, on the other hand, without the other’s consent (which consent shall not be unreasonably withheld, conditioned or delayed) unless (i) there is no finding or admission of any violation of Law and no effect on any other claims that may be made against such other party and (ii) each Indemnified Party that is party to such other claim is released from all liability with respect to such other claim.

Section 7.4Procedure for Indemnification. Upon determination of the amount of a Claim that is binding on both the Indemnifying Party and the Indemnified Party, the Indemnifying Party shall, within ten (10) days of the date such amount is determined, pay the amount of such Claim by wire transfer of immediately available funds to an account designated by the Indemnified Party.

Section 7.5Expiration.

(a)Subject to the limitations set forth in Section 7.5(b) below, all representations, warranties, covenants and agreements (including those relating to indemnification in Section 7.1) made herein shall survive the Closing Date.

(b)All representations, warranties and covenants of the Indemnifying Party contained in this Agreement shall survive until twelve months after the Closing Date (the “Expiration Date”); provided, however, the representations and warranties set forth in Section 4.11 with respect to Taxes and Section 4.16 with respect to material documents shall survive until the expiration of the applicable statute of limitations for making a claim for such matters. If written notice of a claim in accordance with the provisions of this Article VII has been given prior to the Expiration Date, then the relevant representation, warranty and covenant shall survive, but only with respect to such specific claim, until such claim has been finally resolved. Any claim for indemnification not so asserted in writing by the Expiration Date may not thereafter be asserted and shall forever be waived.

Section 7.6Limitations on Indemnification.

(a)Except as provided in subparagraph (b) below, Seller shall have no liability under Section 7.1 for any Losses hereunder (i) unless and until the aggregate total amount of all such Losses for which Seller would, but for this provision, be liable exceeds, on a cumulative basis, $1,000,000.00, and (ii) in excess of, on a cumulative basis, eight percent (8%) of the Purchase Price.

(b)The limitations in subparagraph (a) above shall not apply to any Losses resulting from Claims made under Section 7.1(b)(i).

Section 7.7Exclusive Remedy. In furtherance of the foregoing, the Indemnified Parties hereby waive to the fullest extent permitted under applicable Law, any and all rights, claims and causes of action (other than claims of, or causes of action arising from, fraud) it may have against the Indemnifying Party arising under or based upon any federal, state, local or foreign Law, other than the right to seek indemnity pursuant to this Article VII. The foregoing sentence shall not limit

18

the Indemnified Party’s right to specific performance or injunctive relief in connection with the breach by the Indemnifying Party of the provisions of this Agreement.

ARTICLE VIIIGENERAL PROVISIONS

Section 8.1Additional Definitions. For the purposes of this Agreement, the following terms shall have the following meanings:

(a)“Affiliate” means, with respect to any Person, a Person that, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with the specified Person. For the purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”) as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise; provided, however, for purposes of this Agreement, Ashford Select and Ashford Select OP are deemed not to be Affiliates of Ashford Trust or Seller.

(b)“Business Day” means any day that is not a Saturday, Sunday or legal holiday in the State of Texas.

(c)“Code” means the Internal Revenue Code of 1986, as amended, together with the rules and regulations promulgated or issued thereunder.

(d)“Environmental Law” means all federal, state and local Laws governing pollution or the protection of human health or the environment.

(e)“Governmental Authority” means any government or agency, bureau, board, commission, court, department, official, political subdivision, tribunal or other instrumentality of any government, whether federal, state or local, domestic or foreign.

(f)“Law” means laws, statutes, rules, regulations, codes, Orders, ordinances, judgments, injunctions, decrees and policies of any Governmental Authority.

(g)“Liens” means all pledges, claims, liens, charges, restrictions, controls, easements, rights of way, exceptions, reservations, leases, licenses, grants, covenants and conditions, Encumbrances and security interests of any kind or nature whatsoever.

(h)“Order” means any order, writ, judgment, injunction, decree, ruling, assessment, stipulation, determination or award entered by or with any court or other Governmental Authority or arbitrator.

(i)“Person” means an individual, corporation, partnership, limited liability company, joint venture, association, trust, unincorporated organization or other entity.

19

(j)“Subsidiary” of any Person means any corporation, partnership, limited liability company, joint venture, trust or other legal entity of which such Person owns (either directly or through or together with another Subsidiary of such Person) either (i) a general partner, managing member or other similar interest or (ii) (A) 10% or more of the voting power of the voting capital stock or other equity interest or (B) 10% or more of the outstanding voting capital stock or other voting equity interest of such corporation, partnership, limited liability company, joint venture, trust or other legal entity.

(k)“Taxes” means all federal, state, local and foreign income, property, withholding, sales, franchise, employment, excise and other taxes, tariffs or governmental charges of any nature whatsoever, including estimated taxes, together with penalties, interest or additions to tax with respect thereto.

(l)“Tax Return” means any return, declaration, report, claim for refund, or information return or statement related to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

Section 8.2Tax Agreement. Omitted.

Section 8.3Amendment. Any amendment hereto shall be in writing and signed by all parties hereto. No waiver of any of the provisions of this Agreement shall be valid unless in writing and signed by the party against whom enforcement is sought.

Section 8.4Entire Agreement; Counterparts; Applicable Law. This Agreement (a) constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof, (b) may be executed in several counterparts, each of which will be deemed an original and all of which shall constitute one and the same instrument and (c) shall be governed in all respects, including validity, interpretation and effect, by the laws of the State of Texas without giving effect to the conflict of law provisions thereof.

Section 8.5Assignability. This Agreement shall be binding upon, and shall be enforceable by and inure to the benefit of, the parties hereto and their respective heirs, legal representatives, successors and assigns; provided, however, that this Agreement may not be assigned (except by operation of law) by any party without the prior written consent of the other parties, and any attempted assignment without such consent shall be void and of no effect.

Section 8.6Titles. The titles and captions of the Articles, Sections and paragraphs of this Agreement are included for convenience of reference only and shall have no effect on the construction or meaning of this Agreement.

Section 8.7Third Party Beneficiary. No provision of this Agreement is intended, nor shall it be interpreted, to provide or create any third party beneficiary rights or any other rights of any kind in any customer, Affiliate, stockholder, partner, director, officer or employee of any party hereto or any other Person.

20

Section 8.8Severability. If any provision of this Agreement, or the application thereof, is for any reason held to any extent to be invalid or unenforceable, the remainder of this Agreement and application of such provision to other Persons or circumstances will be interpreted so as to reasonably effect the intent of the parties hereto. The parties further agree to replace such void or unenforceable provision of this Agreement with a valid and enforceable provision that will achieve, to the extent possible, the economic, business and other purposes of the void or unenforceable provision and to execute any amendment, consent or agreement deemed necessary or desirable by a party to effect such replacement.

Section 8.9Equitable Remedies. The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof in any federal or state court located in the State of Texas (as to which the parties agree to submit to jurisdiction for the purposes of such action), this being in addition to any other remedy to which they are entitled at law or in equity.]

Section 8.10Attorneys’ Fees. In connection with any litigation or a court proceeding arising out of this Agreement, the prevailing party shall be entitled to recover all costs incurred, including reasonable attorneys’ fees and legal assistants’ fees and costs whether incurred prior to trial, at trial or on appeal.

Section 8.11Notices. Any notice or demand which must or may be given under this Agreement or by law shall, except as otherwise provided, shall be in writing and shall be deemed to have been given (i) five (5) Business Days following sending by registered or certified mail, postage prepaid, (ii) when sent, if sent by facsimile, (iii) when delivered, if delivered personally to the intended recipient, and (iv) one (1) Business Day following sending by overnight delivery via a national courier service and, if each case, addressed to a party at the following address for such party.

(a) in the case of a notice to any Ashford Select Entity, at the following address and telecopy number:

Ashford Hospitality Select Limited Partnership

c/o Ashford Hospitality Advisors LLC

14185 Dallas Parkway, Suite 1100

Dallas, Texas 75254

Attention: Chief Operating Officer

Phone: (972) 496-9600

Fax: (972) 490-9605

(b) in the case of a notice to Seller, at the following address and telecopy number:

Ashford TRS VI Corporation

c/o Ashford Hospitality Trust, Inc.

21

14185 Dallas Parkway, Suite 1100

Dallas, Texas 75254

Phone: (972) 490-9600

Fax: (972) 490-9605

(c) in each case, with a copy to:

Andrews Kurth LLP

1717 Main Street, Suite 1700

Dallas, TX 75201

Attention: Muriel C. McFarling

Section 8.12Computation of Time. Any time period provided for herein which shall end on a Saturday, Sunday or legal holiday shall extend to 5:00 p.m. of the next full Business Day. All times are Central Standard Time.

Section 8.13Survival. It is the express intention and agreement of the parties hereto that the representations, warranties and covenants of Seller and the Ashford Select Entities set forth in this Agreement shall survive the consummation of the transactions contemplated hereby as set forth in Section 7.5(b).

Section 8.14Time of the Essence. Time is of the essence with respect to all obligations of Seller, and the Ashford Select Entitles under this Agreement.

[Signature Pages to Follow]

22

IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement, or caused the Agreement to be duly executed on its behalf, as of the date first above written.

SELLER:

ASHFORD TRS IV CORPORATION

By: /s/ DERIC EUBANKS

Name: Deric Eubanks

Title: President

ASHFORD SELECT ENTITIES:

ASHFORD HOSPITALITY SELECT, INC.

By: /s/ DAVID BROOKS

Name: David Brooks

Title: Chief Operating Officer and General Counsel

ASHFORD HOSPITALITY SELECT LIMITED PARTNERSHIP

By: Ashford OP Select General Partner LLC, its general partner

By: /s/ DAVID BROOKS

Name: David Brooks

Title: Vice President

[Signature Page to the Purchase and Sale Agreement - Jacksonville]

Exhibit A

Property

Property	Seller	Purchased Entity	Equity Interest	Assignee	Relationship to Property
Residence Inn Jacksonville, 10551 Deerwood Park Blvd Jacksonville, FL	Ashford TRS VI Corporation	RFS SPE 2000 LLC	100% member interest	Ashford Select OP	Ashford TRS VI Corporation owns 100% of RFS SPE 2000 LLC, which owns (a) 100% of Ashford Jacksonville IV GP LLC, which owns a 0.5% GP interest in, (b) and a 99.5% limited partnership interest in, Ashford Jacksonville IV LP, which owns 100% of the Residence Inn Jacksonville.

Exhibit A-1

Exhibit B

Formation Transactions

Exhibit B-1

Exhibit C

List of Subsidiaries of Purchased Entity

Purchased Entity	Subsidiary Entities
RSF SPE 2000 LLC	Ashford Jacksonville IV GP LLC Ashford Jacksonville IV LP

Exhibit C-1

Exhibit D

Form of Assignment and Assumption Agreement

Exhibit D-1

SCHEDULE 4.15

Existing Loan

1. Loan in the original principal amount of $10,800,000 made by German American Capital Corporation, as lender, to Ashford Jacksonville IV LC, as borrower, on December 20, 2013 with respect to the Residence Inn, Jacksonville, Florida, having an outstanding principal amount as of the Closing Date of $10,651,706.

Schedule 4.15 - 1

SCHEDULE 7.1

Retained Ashford Trust Guaranteed Obligations

1. Franchise Agreement with respect to Residence Inn by Marriott located at 10551 Deerwood Park Blvd., Jacksonville, Florida, dated May 21, 2007, between Marriott International, Inc. and Ashford TRS Jacksonville IV LLC, as amended.

Schedule 7.1 - 1

EX-10.3.1

EXHIBIT 10.3.1

May 8, 2015    

Ashford TRS VI Corporation

14185 Dallas Parkway, Suite 1100

Dallas, TX 75254

Ladies and Gentlemen:

Reference is made to that certain Purchase and Sale Agreement (the “Agreement”), dated as of February 18, 2015, by and between Ashford TRS VI Corporation, Ashford Hospitality Select, Inc. and Ashford Hospitality Select Limited Partnership. Capitalized terms not otherwise defined in this letter have the meanings assigned in the Agreement.

The undersigned hereby notify you, pursuant to Section 2.3 of the Agreement, that the Agreement is terminated and of no further force and effect.

Very truly yours,

ASHFORD HOSPITALITY SELECT LIMITED PARTNERSHIP

By: Ashford OP Select General Partner LLC, its general partner

By: /s/ DAVID BROOKS

Name: David Brooks

Title: Vice President

EX-10.4

EXHIBIT 10.4

PURCHASE AND SALE AGREEMENT

BY AND BETWEEN

ASHFORD TRS CORPORATION,a Delaware corporation,

Ashford TRS VI Corporation,

a Delaware corporation

and

ASHFORD SELECT TRS CORPORATION,a Delaware corporation

February 18, 2015

TABLE OF CONTENTS

Page

ARTICLE I BASIC TRANSACTION1

Section 1.1Basic Transaction1

Section 1.2Consideration2

Section 1.3Omitted2

Section 1.4Further Action2

ARTICLE II CLOSING PROCEDURES3

Section 2.1Conditions to Closing3

Section 2.2Documents to be Delivered at Closing4

Section 2.3Termination of the Offering5

Section 2.4Effect of Termination5

Section 2.5Closing Costs6

Section 2.6Tax Withholding6

ARTICLE III REPRESENTATIONS AND WARRANTIES OF ASHFORD SELECT TRS6

Section 3.1Organization of Ashford Select TRS6

Section 3.2Authority6

Section 3.3Noncontravention6

Section 3.4Ashford Select TRS Litigation7

Section 3.5Limited Activities7

Section 3.6No Other Representations and Warranties7

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF SELLERS7

Section 4.1Organization of Sellers, Purchased Entities and Subsidiary Entities7

Section 4.2Authorization of Transaction7

Section 4.3Authority to Conduct Business7

Section 4.4Noncontravention8

Section 4.5No Encumbrances8

Section 4.6No Other Agreements to Sell9

Section 4.7Ownership of Operating Leases9

Section 4.8Compliance with Laws9

Section 4.9Licenses and Permits9

Section 4.10Environmental Matters9

Section 4.11Taxes10

i

Section 4.12Litigation10

Section 4.13No Insolvency Proceedings10

Section 4.14Existing Loans10

Section 4.15Material Documents10

Section 4.16No Other Representations and Warranties11

ARTICLE V COVENANTS11

Section 5.1Covenants of the Sellers11

Section 5.2Commercially Reasonable Efforts12

ARTICLE VI TAX MATTERS12

Section 6.1Tax Returns12

Section 6.2Cooperation13

Section 6.3Transfer Taxes13

Section 6.4Tax Contests14

ARTICLE VII INDEMNITY OBLIGATIONS14

Section 7.1Indemnity14

Section 7.2Notice of Claims15

Section 7.3Third Party Claims16

Section 7.4Procedure for Indemnification16

Section 7.5Expiration16

Section 7.6Limitations on Indemnification17

Section 7.7Exclusive Remedy17

ARTICLE VIII GENERAL PROVISIONS17

Section 8.1Additional Definitions17

Section 8.2Tax Agreement18

Section 8.3Amendment18

Section 8.4Entire Agreement; Counterparts; Applicable Law18

Section 8.5Assignability19

Section 8.6Titles19

Section 8.7Third Party Beneficiary19

Section 8.8Severability19

Section 8.9Equitable Remedies19

Section 8.10Attorneys’ Fees19

Section 8.11Notices19

ii

Section 8.12Computation of Time20

Section 8.13Survival20

Section 8.14Time of the Essence20

iii

List of Schedules and Exhibits

Exhibits

Exhibit A – Property and Ownership Table

Exhibit B - Formation Transactions

Exhibit C - Purchase Price

Exhibit D - List of Subsidiaries Entities

Exhibit E - Form of Assignment and Assumption Agreement

Schedules

Schedule 4.14 – Existing Loans

iv

PURCHASE AND SALE AGREEMENT

THIS PURCHASE AND SALE AGREEMENT (this “Agreement”) is executed as of this 18th day of February, 2015 by and between ASHFORD TRS CORPORATION, a Delaware corporation (“Ashford TRS”), ASHFORD TRS VI CORPORATION, a Delaware corporation (“Ashford TRS VI”, and together with Ashford TRS, the “Sellers”) and ASHFORD SELECT TRS CORPORATION, a Delaware corporation (“Ashford Select TRS”).

WHEREAS, the Sellers own equity interests (the “Equity Interests”) in various taxable REIT Subsidiaries (the “Purchased Entities”) that are, or directly or indirectly own entities that are, the lessees under operating leases (the “Operating Leases”) with respect to the properties (the “Properties”) as more fully described in Exhibit A;

WHEREAS, each Seller desires to sell its Equity Interests in the Purchased Entities and Ashford Select TRS desires to acquire the Equity Interests in the Purchased Entities from the Sellers;

WHEREAS, the transactions contemplated by this Agreement and certain other structuring transactions to be completed prior to or on the Closing Date as set forth on Exhibit B (collectively the “Formation Transactions”) are in connection with a proposed private placement (the “Offering”) of Ashford Hospitality Select, Inc. Class A common stock.

NOW, THEREFORE, in consideration of the foregoing, the representations, warranties, covenants and other terms and the mutual covenants and conditions set forth herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Sellers and Ashford Select TRS agree as follows:

ARTICLE IBASIC TRANSACTION

Section 1.1Basic Transaction.

(a)Upon and subject to the terms and conditions contained in this Agreement, at the Closing (as hereinafter defined), the Sellers shall sell, assign, set over and transfer, absolutely and unconditionally, to Ashford Select TRS all of such Seller’s right, title and interest in and to the Equity Interests, in each case, free and clear of all Encumbrances except as set forth in Section 4.5, in exchange for the consideration set forth in Section 1.2; and Ashford Select TRS shall accept the applicable assignment by each Seller. From and after the Closing Date, Ashford Select TRS shall be bound by terms of the applicable organizational documents governing the respective Purchased Entities and shall undertake, assume punctually and faithfully perform, pay or discharge when due and otherwise in accordance with their respective terms, all agreements, covenants, conditions, obligations and liabilities of each Seller with respect to the applicable Purchased Entities on or after the Closing Date. The “Closing Date” shall mean the date on which the Closing occurs, which shall be the same date as the closing of the Offering, unless otherwise agreed upon by the parties.

(b)This Agreement shall serve as notice to the partners, manager, or members, as the case may be, of each of the Purchased Entities of the transfer of each Seller’s Equity Interest, and such partners, manager or members, as the case may be, of each of the applicable Purchased Entities consents to, and agrees and acknowledges that all requirements and conditions for such transfer and the admission of Ashford Select TRS as a substituted partner or member have been satisfied or otherwise waived in accordance with the terms of the organizational documents governing each Seller’s Equity Interest.

(c)All of the parties hereto agree that, as a result of the assignments and assumptions hereunder, for purposes of the organizational documents governing each Seller’s Equity Interest, Ashford Select TRS shall be a substituted limited partner or member, as the case may be, of the applicable Purchased Entity.

Section 1.2Consideration.

(a)Closing Consideration. At the Closing, and subject to the terms and subject to the conditions set forth in this Agreement, as consideration for the sale by each Seller of the Equity Interests, Ashford Select TRS agrees to pay to the Sellers total consideration of $3,412,000 (the “Purchase Price”), payable in cash at Closing. Such Purchase Price shall be allocated among each Seller as set forth in Exhibit C.

(b)Post-Closing Adjustments. At the Closing, the Sellers will receive a credit to the Purchase Price in an amount equal to the aggregate net working capital (i.e., such Seller’s working capital assets less working capital liabilities of the Properties as of the Closing Date). For a period of six (6) months following the Closing Date, the parties shall work together in good faith to true-up the credit provide in this Section 1.2(b).

2

Section 1.3Omitted

Section 1.4Further Action. If, at any time after the Closing Date, Ashford Select TRS shall determine or be advised that any deeds, bills of sale, assignments (including intellectual property assignments), certificates, affidavits, consents, assurances or other actions or items are necessary or desirable to vest, perfect or confirm of record or otherwise transfer the right, title or interest in or to the Equity Interests sold by the Sellers to Ashford Select TRS and all rights and privileges associated with the its interest in the Properties, each Seller shall execute and deliver all such deeds, bills of sale, assignments (including any intellectual property assignments), certificates, affidavits, consents, and assurances and take and do all such other actions and things as may be necessary or desirable to vest, perfect or confirm any and all right, title and interest in or to the Equity Interests or otherwise to carry out this Agreement; provided, that no Seller shall be obligated to take any action or execute any document if the additional actions or documents impose additional liabilities, obligations, covenants, responsibilities, representations or warranties of Sellers that are material in nature and are not contemplated by this Agreement or reasonably inferable by the terms hereof.

ARTICLE IICLOSING PROCEDURES

Section 2.1Conditions to Closing.

(c)Conditions to Each Party’s Obligations. The obligation of each party to effect the sale contemplated by this Agreement and to consummate the other transactions contemplated hereby on the Closing is subject to the satisfaction or written waiver of the following conditions:

(i)The closing of the Offering shall have occurred prior to or simultaneously with the closing of the transactions contemplated hereby.

(ii)The Formation Transactions shall have been consummated not later than the Closing Date.

(iii)All consents and approvals of Governmental Authorities or third parties, including the waiver of any applicable right of first offer or right of first refusal with respect to the Equity Interests or any Seller’s, Purchased Entity’s or Subsidiary Entity’s interest in any of the Properties and any consent or approval required by any Existing Loan Documents (as hereinafter defined), necessary for the parties hereto to consummate the transactions contemplated hereby (except for those the absence of which would not have a material adverse effect on the ability of any party hereto to consummate the transactions contemplated by this Agreement) shall have been obtained or waived in writing.

(iv)No Governmental Authority shall have enacted, issued, promulgated, enforced or entered any statute, rule, regulation, executive order, decree, judgment, injunction or other Order (whether temporary, preliminary or permanent), in any

3

case which is in effect and which prevents or prohibits consummation of any of the transactions contemplated in this Agreement nor shall any of the same brought by a Government Authority of competent jurisdiction be pending that seeks the foregoing.

(d)Conditions to Obligations of Ashford Select TRS. The obligations of Ashford Select TRS is further subject to the satisfaction of the following conditions (any of which may be waived in writing by Ashford Select TRS in whole or in part):

(i)Except as would not have a material adverse effect on the business of Ashford Select TRS, the Purchased Entities or any subsidiary of the Purchased Entities listed on Exhibit D (each, a “Subsidiary Entity”) or any Property, the representations and warranties of each Seller contained in this Agreement shall be true and correct as of the Closing Date (except to the extent that any such representation or warranty speaks as of an earlier date, in which case it must be true and correct only as of such earlier date). This Section 2.1(b)(i) shall in no way limit, and shall be subject to, the provisions of Section 7.1.

(ii)The Sellers shall have executed and delivered each of the closing documents identified in Section 2.2(a) to Ashford Select TRS, along with any other agreements or instruments reasonably necessary to consummate the contribution of the Equity Interests to Ashford Select TRS (collectively, the “Seller Closing Documents”).

(e)Conditions to the Obligations of the Sellers. The obligations of each Seller are further subject to the satisfaction of the following conditions (any of which may be waived in writing by the Sellers in whole or in part):

(i)Except as would not have a material adverse effect on the business of the Sellers, the representations and warranties of Ashford Select TRS contained in this Agreement shall be true and correct as of the Closing Date (except to the extent that any such representation or warranty speaks as of an earlier date, in which case it must be true and correct only as of such earlier date).

(ii)Ashford Select TRS shall have executed and delivered each of the closing documents identified in Section 2.2(b) to Sellers, along with any other agreements or instruments reasonably necessary to consummate the transfer of the Purchase Price to Sellers (collectively, the “Ashford Select Closing Documents”).

Section 2.2Documents to be Delivered at Closing.

(a)Seller Closing Documents. On the Closing Date, each Seller shall execute, acknowledge where deemed desirable or necessary by Ashford Select TRS, and deliver to Ashford Select TRS, in addition to any other documents mentioned elsewhere herein, the following Seller Closing Documents:

4

(i)An assignment, assumption and admission agreement (“Assignment Agreement”)substantially in the form of Exhibit F attached hereto executed by the applicable Seller, assigning the Equity Interest of such Purchased Entity held by such Seller to Ashford Select TRS with each Purchased Entity acknowledging the admission of Ashford Select TRS as the successor to Seller’s Equity Interest in such Purchased Entity and further acknowledging the admission of Ashford Select TRS as a partner or member of such Purchased Entity.

(ii)A closing certificate which shall be in a form satisfactory to Ashford Select TRS and which shall reaffirm (subject to Section 2.1(b)(i)), the accuracy of all representations and warranties in all material respects and the satisfaction in all material respects of all covenants made by each Seller in Articles IV and V hereof.

(iii)A certified copy of all corporate resolutions, consents or partnership actions authorizing the execution, delivery and performance by Sellers of this Agreement and the Seller Closing Documents.

(iv)True, correct and complete copies of all organizational documents of each Purchased Entity and each Subsidiary Entity.

(v)An affidavit certifying that no Seller and no Purchased Entity or any Subsidiary Entity is a “foreign person”, as that term is defined by Section 1445 of the Code.

(vi)All documents required by any lender, manager or franchisor in connection with the contribution of the Equity Interests by the Sellers.

(vii)All leases, management agreements, book and records, service contracts and other material documents relating to the operation of the Properties.

(viii)Any other documents reasonably necessary to assign, transfer and convey the Equity Interests and effectuate the transactions contemplated hereby.

(b)Ashford Select Closing Documents. On the Closing Date, Ashford Select TRS shall execute, acknowledge where deemed desirable or necessary by Sellers, and deliver to Sellers, (or cause to be executed, acknowledged or delivered) in addition to any other documents mentioned elsewhere herein, the following Ashford Select Closing Documents:

(v)A closing certificate which shall be in a form satisfactory to Sellers and which shall reaffirm (subject to Section 2.1(c)(i)), the accuracy of all representations and warranties in all material respects and the satisfaction in all material respects of all covenants made by Ashford Select TRS in Articles III and V hereof.

5

(vi)A certified copy of all appropriate corporate resolutions or partnership actions authorizing the execution, delivery and performance by Ashford Select TRS of this Agreement and the Ashford Select Closing Documents.

(vii)An executed counterpart to the Assignment Agreement.

(viii)All documents required by any lender, manager or franchisor in connection with the contribution of the Equity Interests.

(ix)Any other documents reasonably necessary to assign, transfer and convey the Purchase Price to the Sellers and effectuate the transactions contemplated hereby.

Section 2.3Termination of the Offering.

(a)If at any time the Offering shall terminate, Ashford Select TRS will so advise the Sellers in writing, whereupon this Agreement shall terminate effective as of the date such notice is delivered.

Section 2.4Effect of Termination. In the event of termination of this Agreement for any reason, all obligations on the part of all parties to this Agreement shall terminate, except as otherwise provided herein.

Section 2.5Closing Costs. Ashford Select TRS shall pay and/or reimburse the Sellers for all of the closing costs, third party fees and third party expenses, including, but not limited to, banking fees, accounting fees, legal fees, assumption fees, transfer taxes and any other costs and expenses of the Sellers arising from the contribution of the Equity Interests pursuant to this Agreement (collectively, “Closing Costs”), excluding any income Tax liability incurred by the Sellers in connection therewith.

Section 2.6Tax Withholding. Ashford Select TRS shall be entitled to deduct and withhold, from the Purchase Price payable pursuant to this Agreement to Sellers, such amounts as Ashford Select TRS is required to deduct and withhold with respect to the making of such payment under the Code or any provision of state, local or foreign Tax Law. To the extent that amounts are so withheld, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the applicable Seller.

ARTICLE IIIREPRESENTATIONS AND WARRANTIES OF ASHFORD SELECT TRS

As a material inducement to Sellers to enter into this Agreement and to consummate the transactions contemplated hereby, Ashford Select TRS hereby makes to Sellers each of the representations and warranties set forth in this Article III.

Section 3.1Organization of Ashford Select TRS. Ashford Select TRS is duly organized, validly existing and in good standing under the laws of the jurisdiction of such entity’s organization.

6

Section 3.2Authority. Ashford Select TRS has full right, authority, power and capacity to: (i) enter into this Agreement and each agreement, document and instrument to be executed and delivered by or on behalf of it pursuant to this Agreement, including without limitation, the Ashford Select Closing Documents; and (ii) carry out the transactions contemplated hereby and thereby. This Agreement and each agreement, document and instrument executed and delivered by Ashford Select TRS pursuant to this Agreement constitutes, or when executed and delivered will constitute, the legal, valid and binding obligation of Ashford Select TRS, each enforceable in accordance with its respective terms.

Section 3.3Noncontravention. The execution, delivery and performance of this Agreement and each such agreement, document and instrument by Ashford Select TRS: (A) does not and will not violate the organizational documents of Ashford Select TRS; (B) does not and will not violate any foreign, federal, state, local or other Law applicable to Ashford Select TRS, or require Ashford Select TRS to obtain any approval, consent or waiver of, or make any filing with, any Person or authority (governmental or otherwise) that has not been obtained or made (or will not have been obtained or made on or before the Closing) or which does not remain in effect; and (C) does not and will not result in a breach of, constitute a default under, accelerate any obligation under or give rise to a right of termination of, any indenture or loan or credit agreement or any other agreement, contract, instrument, mortgage, Lien, lease, permit, authorization, Order, writ, judgment, injunction, decree, determination or arbitration award to which Ashford Select TRS is a party or by which the property of Ashford Select TRS is bound or affected, in the case of each of (A), (B) and (C), in any manner that challenges or would reasonably be expected to impair the ability of Ashford Select TRS to execute or deliver or materially perform its obligations under this Agreement and the documents executed by it pursuant to this Agreement or to consummate the transactions contemplated hereby or thereby.

Section 3.4Ashford Select TRS Litigation. There is no action, suit or proceeding pending or, to the knowledge of Ashford Select TRS, threatened against Ashford Select TRS, that challenges or would reasonably be expected to impair the ability of Ashford Select TRS to execute or deliver or materially perform its obligations under this Agreement and the documents executed by it pursuant to this Agreement or to consummate the transactions contemplated hereby or thereby.

Section 3.5Limited Activities. Except for activities in connection with the Offering, the Formation Transactions or in the ordinary course of business, Ashford Select TRS has not engaged in any material business or incurred any material obligations.

Section 3.6No Other Representations and Warranties. Other than the representations and warranties expressly set forth in this Article III, Ashford Select TRS shall not be deemed to have made any other representation or warranty in connection with this Agreement or the transactions contemplated hereby.

ARTICLE IVREPRESENTATIONS AND WARRANTIES OF SELLERS

7

As a material inducement to Ashford Select TRS to enter into Agreement and to consummate the transactions contemplated hereby, each Seller hereby makes to Ashford Select TRS each of the representations and warranties set forth in this Article IV.

Section 4.1Organization of Sellers, Purchased Entities and Subsidiary Entities. Each Seller, each Purchased Entity and each Subsidiary Entity is duly organized, validly existing and in good standing under the laws of the respective jurisdiction of such entity’s organization, and is qualified to do business in each jurisdiction in which the operation of its business makes such qualification necessary or desirable.

Section 4.2Authorization of Transaction. Subject to the receipt of third-party consents (or waivers) as required as a condition to closing pursuant to Section 2.1(a)(iii), each Seller has full right, authority, power and capacity to: (i) enter into this Agreement and each agreement, document and instrument to be executed and delivered by or on behalf of such Seller pursuant to this Agreement, including, without limitation, the Seller Closing Documents; (ii) carry out the transactions contemplated hereby and thereby; and (iii) transfer, sell and deliver the Equity Interests to Ashford Select TRS upon payment therefor in accordance with this Agreement. This Agreement and each agreement, document and instrument executed and delivered by or on behalf of each Seller pursuant to this Agreement constitutes, or when executed and delivered will constitute, the legal, valid and binding obligation of such Seller, each enforceable in accordance with its respective terms.

Section 4.3Authority to Conduct Business. Each Purchased Entity and each Subsidiary Entity is duly authorized to conduct business and is in good standing under the laws of each jurisdiction where such qualification is required. Each Purchased Entity and each Subsidiary Entity has full power and authority and all licenses, permits, and authorizations necessary to carry on the businesses in which it is engaged and to own and use the properties owned and used by it. Sellers have delivered, or have caused to be delivered, to Ashford Select TRS correct and complete copies of the partnership or limited liability company agreement, as applicable, of each Purchased Entity and Subsidiary Entity, as amended to date (each, an “Operating Agreement”). No Purchased Entity or Subsidiary Entity is in default under or in violation of any provision of its Operating Agreement.

Section 4.4Noncontravention. Subject to the receipt of third-party consents (or waivers) as required as a condition to Closing pursuant to Section 2.1(a)(iii), the execution, delivery and performance of this Agreement and each additional agreement, document and instrument to be executed and delivered by or on behalf of each Seller pursuant to this Agreement, including, without limitation, the Seller Closing Documents: (A) does not and will not violate the Operating Agreement of any Purchased Entity, Subsidiary Entity or Seller’s partnership agreement, limited liability agreement or bylaws, as applicable; (B) does not and will not violate any foreign, federal, state, local or other Law applicable to any Purchased Entity or Seller, or require any Purchased Entity or Seller to obtain any approval, consent or waiver of, or make any filing with, any Person or authority (governmental or otherwise) that has not been obtained or made or which does not remain in effect; and (C) does not and will not result in a breach of, constitute a default under, accelerate any obligation under or give rise to a right of termination of, any indenture or loan or credit agreement or any other agreement, contract, instrument, mortgage, Lien, lease, permit, authorization, Order, writ, judgment, injunction, decree, determination or arbitration award to which any Purchased Entity, Subsidiary

8

Entity or Seller is a party or by which the property of any Purchased Entity, Subsidiary Entity or Seller is bound or affected, or result in the creation of any Encumbrance on any Purchased Entity, Subsidiary Entity or the Equity Interests of any Seller.

Section 4.5No Encumbrances. As of the Closing Date, each Seller will be the beneficial and record holder of the applicable Equity Interest in the Purchased Entities, and indirectly, the Subsidiary Entities, free and clear of any restrictions on transfer (other than any restrictions under the Securities Act of 1933, as amended (the “Securities Act”) or the securities laws of any state (“Blue Sky Laws”)), claim, Lien, pledge, voting agreement, option, charge, security interest, mortgage, deed of trust, encumbrance, rights of assignment, purchase rights or other rights of any nature whatsoever of any third party (collectively, “Encumbrances”) other than Liens created by the Existing Loans, and as of the Closing Date, will have the full power and authority to convey the applicable Equity Interest free and clear of any Encumbrances, and upon delivery of the Assignment Agreement by Seller conveying its Equity Interests and receipt by Sellers of the Purchase Price as herein provided, Ashford Select TRS will acquire good and valid title thereto, free and clear of all Encumbrances. The Sellers own, directly or indirectly, one hundred percent (100%) of the partnership or membership interests, as applicable, in the respective Purchased Entities, and Exhibit A is true, correct and complete. All of the Equity Interests have been duly authorized and validly issued, are fully paid and non-assessable, and there are no requirements for any additional capital contributions to any of the Purchased Entities or Subsidiary Entities. No Purchased Entity has issued any outstanding partnership, LLC membership or other equity ownership interests and no Purchased Entity has any outstanding options, warrants, convertible securities, calls, rights, commitments, preemptive rights, agreements, arrangements or understanding of any character obligating any Purchased Entity to (i) issue, deliver or sell, or cause to be issued, delivered or sold, additional equity ownership interests in such Purchased Entity or any securities or obligations convertible into or exchangeable for ownership interests in such Purchased Entity; or (ii) grant, extend or enter into any such option, warrant, convertible security, call, right, commitment, preemptive right, agreement, arrangement or understanding.

Section 4.6No Other Agreements to Sell. Each Seller represents that it has made no agreement with, and will not enter into any agreement with, and has no obligation (absolute or contingent) to, any other Person or firm to sell, transfer or in any way encumber the Equity Interests in any Purchased Entity or to not sell the Equity Interests in any Purchased Entity, or to enter into any agreement with respect to a sale, transfer or Encumbrance of or put or call right with respect to the Equity Interest in any Purchased Entity.

Section 4.7Ownership of Operating Leases. Each Purchased Entity or Subsidiary Entity, as applicable, is the sole owner of the Operating Lease with respect to the Property or Properties, as applicable, set forth next to its name in Exhibit A attached hereto. Each Operating Lease owned by each Purchased Entity or Subsidiary Entity, as applicable, is free and clear of all Encumbrances, other than Liens created by the Existing Loans. Each Purchased Entity or Subsidiary Entity, as applicable, neither owns nor has any interest in any or liabilities except as relate to the Operating Leases, Properties or Existing Loans.

9

Section 4.8Compliance with Laws. Each Purchased Entity and Subsidiary Entity has conducted its business in compliance with all applicable Laws, except for such failures that would not, individually or in the aggregate, reasonably be expected to materially and adversely affect the condition, financial or otherwise, or the earnings or business affairs of any Purchased Entity, Subsidiary Entity or any Property.

Section 4.9Licenses and Permits. Each Purchased Entity and Subsidiary Entity possesses such certificates, authorities or permits issued by the appropriate state or federal agencies or bodies necessary to conduct the business conducted by it except where failure to have any such certificates, authorities or permits would not have a material adverse effect on such entity. None of the Sellers, any Purchased Entity or any Subsidiary Entity has received any written notice of proceedings relating to the revocation or modification or any such certificate, authority or permit which, singly or in the aggregate, if the subject of an unfavorable decision, ruling, or finding, would materially and adversely affect the condition, financial or otherwise, or the earnings or business affairs of any Purchased Entity, Subsidiary Entity or any Property.

Section 4.10Environmental Matters. Except for matters disclosed in the most recent Phase I environmental reports delivered to Ashford Select TRS, (a) to Sellers’ knowledge, each Seller, each Purchased Entity and each Subsidiary Entity is in compliance with all Environmental Laws and (b) no Seller, Purchased Entity or Subsidiary Entity has received any written notice from any Governmental Authority or third party alleging that any Seller, any Purchased Entity or any Subsidiary Entity is not in compliance with applicable Environmental Laws. The representations and warranties contained in this Section 4.10 constitute the sole and exclusive representations and warranties made by Seller concerning environmental matters.

Section 4.11Taxes. (i) All Taxes (including, but not limited to, real estate Taxes due and owing with respect to any personal property Taxes) required to be paid by each Purchased Entity or Subsidiary Entity on or before the date hereof have been paid and all Tax Returns required to be filed on or before the date hereof (taking into account any extensions to file previously received) by or on behalf of any Purchased Entity or Subsidiary Entity have been timely filed and such returns were true, correct and complete in all material respects when filed; and (ii) there is no action, suit or proceeding pending against or threatened with respect to any Purchased Entity, Subsidiary Entity in respect of any Tax, nor is any claim for additional Tax asserted by any Purchased Entity or Subsidiary Entity nor are any federal, state and local income or franchise Tax Returns of such Purchased Entity or Subsidiary Entity the subject of any audit or examination by any taxing authority. No Purchased Entity or Subsidiary Entity has executed or filed with the Internal Revenue Service or any other taxing authority any agreement now in effect extending the period for assessment or collection of any income or other Taxes.

Section 4.12Litigation. There is no action, suit or proceeding pending or, to the knowledge of the Sellers, threatened against any Purchased Entity except as set forth on Schedule 4.12 hereto. There is no action, suit or proceeding pending or, to the Knowledge of the Sellers, threatened against any Subsidiary Entity or that affects a Property, which if adversely determined, would reasonably be expected to have a material adverse effect on the condition, financial or otherwise, or the earnings or business affairs of any Subsidiary Entity or any Property. There is no action, suit, or proceeding

10

pending or, to the knowledge of Seller, threatened against any Seller which challenges or impairs the ability of such Seller to execute or deliver, or materially perform its obligations under this Agreement or to consummate the transactions hereby. Seller has not received notice of any condemnation or eminent domain proceeding.

Section 4.13No Insolvency Proceedings. No bankruptcy or similar insolvency proceeding has been filed, or is currently contemplated, with respect to any Seller or any of the Purchased Entities or Subsidiary Entities.

Section 4.14Existing Loans. Schedule 4.14 sets forth a true, correct and complete list, as of the date hereof, of all loans presently encumbering the Properties, the Purchased Entities or the Subsidiary Entities that will exist at and after the closing (collectively, the “Existing Loans”). Other than the outstanding balance of the Existing Loans and any accrued interest on the Existing Loans, there are no other amounts outstanding under any Existing Loans. No monetary default (beyond applicable notice and cure periods) by any party exists under any of the Existing Loans and the documents entered into in connection therewith (collectively, the “Existing Loan Documents”) and no material non-monetary default (beyond applicable notice and cure periods) by any party exists under any of such Existing Loan Documents. True, correct and complete copies of all Existing Loan Documents have been provided by the Sellers to Ashford Select TRS.

Section 4.15Material Documents. (a) The organizational documents provided by or on behalf of the Sellers to the Ashford Select Entities for each Purchased Entity and Subsidiary Entity are true, correct and complete and there are no other governing documents for such entities; (ii) the financial statements provided by or on behalf of the Sellers to the Ashford Select Entities for each Purchased Entity, Subsidiary Entity and Property are true, correct and complete in all material respects and disclose all material liabilities, including all material contingent liabilities; and (iii) all leases, management agreements, book and records, service contracts and other material documents relating to the operation of the Properties provided by or on behalf of the Sellers to the Ashford Select Entities are true, correct and complete in all material respects.

Section 4.16No Other Representations and Warranties. Other than the representations and warranties expressly set forth in this Article IV or in any Seller Closing Documents, the Sellers shall not be deemed to have made any other representation or warranty in connection with this Agreement or the transactions contemplated hereby.

ARTICLE VCOVENANTS

Section 5.1Covenants of the Sellers. From the date hereof through the Closing Date, except as otherwise provided for or as contemplated by this Agreement, the formation Transactions or the other agreements, documents and instruments contemplated hereby, the Sellers shall use commercially reasonable efforts to (and shall use commercially reasonable efforts to cause each of the Purchased Entities and Subsidiary Entities to conduct its business and operate and maintain the Properties in the ordinary course of business consistent with past practice, pay debt obligations as they become due and payable (except as may be being contested in good faith and in a commercially prudent manner), and use commercially reasonable efforts to preserve intact current business

11

organizations and preserve relationships with lenders and others having business dealings with it, in each case consistent with past practice. From the date hereof through the Closing Date, except as otherwise provided for or as contemplated by this Agreement, the Formation Transactions or other agreements, documents and instruments contemplated hereby or thereby, no Seller shall:

(a)sell, transfer or otherwise dispose of all or any portion of the Equity Interests;

(b)(i) issue or authorize the issuance of any securities in respect of, in lieu of or in substitution for any Equity Interests or make any other changes to the equity capital structure of the Purchased Entities or the Subsidiary Entities, or (ii) purchase, redeem or otherwise acquire any Equity Interests;

(c)issue, deliver, sell, transfer, dispose, mortgage, pledge, assign or otherwise encumber, or cause the issuance, delivery, sale, transfer, disposition, mortgage, pledge, assignment or other encumbrance of, any limited liability company or partnership interests or other equity interests of the Purchased Entities or the Subsidiary Entities, the Properties or other assets of the Purchased Entities or the Subsidiary Entities;

(d)amend, modify or terminate any lease, contract or other instruments relating to a Property, except on an arms-length basis, on market terms, and in the ordinary course of business consistent with past practice;

(e)take or omit to take any action to cause any Lien to attach to the Equity Interests, the equity interest in any Subsidiary Entity, or any Property, except for the Existing Loans;

(f)mortgage, pledge, hypothecate, encumber (or permit to become encumbered) all or any portion of the Equity Interests, the equity interests in any Subsidiary Entities or any Property, except for the Existing Loans;

(g)amend the operating or partnership agreement of any Purchased Entity or Subsidiary Entity, except in connection with the Formation Transactions;

(h)materially alter the manner of keeping the books, accounts or records or the accounting practices therein reflected, of any Purchased Entity or Subsidiary Entity, except in connection with the Formation Transactions;

(i)adopt a plan of liquidation, dissolution, merger, consolidation, restructuring, recapitalization or reorganization with respect to any Seller, Purchased Entity or Subsidiary Entity, except in connection with the Formation Transactions;

(j)violate or knowingly cause or permit any Purchased Entity or Subsidiary Entity to violate in any material respect, or fail to use commercially reasonable efforts to cure any material violation of any Existing Loan Documents, the organizational documents of the Purchased Entities or Subsidiary Entities, or applicable Laws; or

(k)authorize, commit or agree to take any of the foregoing actions.

12

Section 5.2Commercially Reasonable Efforts. Each Seller and Ashford Select TRS shall use commercially reasonable efforts and cooperate with each other in (a) promptly determining whether any filings are required to be made or consents, approvals, waivers, permits or authorizations are required to be obtained (under any applicable Law or regulation from any Governmental Authority or third party) in connection with the transactions contemplated by this Agreement and (b) promptly making any such filings, furnishing information required in connection therewith and timely seeking to obtain any such consents, approvals, waivers, permits or authorizations.

ARTICLE VITAX MATTERS

Section 6.1Tax Returns. The following provisions shall govern the allocation of responsibility and payment of Taxes as between Ashford Select TRS and the Sellers for certain Tax matters following the Closing Date:

(a)Sellers shall prepare or cause to be prepared and file or cause to be filed, subject to the review and reasonable approval of Ashford Select TRS, all Tax Returns for each of the Purchased Entities and Subsidiary Entities for all periods ending on or prior to the Closing Date that are required to be filed after the Closing Date. Ashford Select TRS hereby recognize each Seller’s authority to execute and file, on behalf of the applicable Purchased Entity and Subsidiary Entities, all such Tax Returns (and agrees to take all action necessary to ensure such authorization in conformity with applicable Law and principles of good governance generally). To the extent not otherwise paid by the appropriate Seller to the appropriate taxing authority, Sellers shall reimburse Ashford Select TRS for Taxes of the relevant Purchased Entity or Subsidiary Entity with respect to all such Tax Returns within fifteen (15) Business Days after payment by Ashford Select TRS and/or the Purchased Entity or Subsidiary Entity of such Taxes. All such Tax Returns shall be prepared in a manner that is consistent with the past custom and practice of the Purchased Entities, except as required by a change in applicable Law.

(b)Ashford Select TRS shall prepare or cause to be prepared and file or cause to be filed, subject to the review and reasonable approval of Sellers, any Tax Returns of any of the Purchased Entities and Subsidiary Entities for Tax periods which begin before the Closing Date and end after the Closing Date. The applicable Seller shall pay to Ashford Select TRS, within fifteen (15) Business Days before the date on which Taxes are to be paid with respect to such periods, an amount equal to the portion of such Taxes which relates to the portion of such Tax period ending on the Closing Date. For purposes of this Section 6.1(b) and Section 7.1(b), in the case of any Taxes that are imposed on a periodic basis and are payable for a Tax period that includes (but does not end on) the Closing Date, the portion of such Tax which relates to the portion of such Tax period ending on the Closing Date shall (x) in the case of any Taxes other than Taxes based upon or related to income, gains or receipts (including sales and use taxes), or employment or payroll Taxes, be deemed to be the amount of such Tax for the entire Tax period multiplied by a fraction the numerator of which is the number of days in the Tax period ending on the Closing Date and the denominator of which is the number of days in the entire Tax period, and (y) in the case of any Tax based

13

upon or related to income, gains or receipts (including sales and use taxes), or employment or payroll Taxes, be deemed equal to the amount which would be payable if the relevant Tax period ended on the Closing Date. Any credits relating to a Tax period that begins before and ends after the Closing Date shall be taken into account as though the relevant Tax period ended on the Closing Date. All determinations necessary to give effect to the foregoing allocations shall be made in a manner consistent with reasonable prior practice of the Purchased Entities or the Subsidiary Entities, as applicable.

(c)Ashford Select TRS shall prepare and cause to be prepared and file or cause to be filed all other Tax Returns of any of the Purchased Entities or Subsidiary Entities.

Section 6.2Cooperation. Ashford Select TRS, each of the Purchased Entities, Subsidiary Entities and Sellers agree to retain all books and records with respect to Tax matters pertinent to the Purchased Entities and Subsidiary Entities, and their respective assets or business relating to any taxable period beginning before the Closing Date until the expiration of the statute of limitations (and, to the extent notified by Ashford Select TRS, any extensions thereof) of the respective Tax periods, and to abide by all record retention agreements entered into with any taxing authority. The Sellers shall give Ashford Select TRS reasonable written notice prior to transferring, destroying or discarding any such books and records and, if Ashford Select TRS so requests, Sellers shall allow Ashford Select TRS to take possession of such books and records at Ashford Select TRS’s expense.

Section 6.3Transfer Taxes. All sales, use and transfer taxes, bulk transfer taxes, deed taxes, conveyance fees, documentary and recording charges and similar taxes imposed as a result of the transactions contemplated by this Agreement, together with any interest, penalties or additions to such transfer taxes or attributable to any failure to comply with any requirement regarding Tax Returns (“Transfer Taxes”), shall be paid by Ashford Select TRS. Ashford Select TRS and Sellers shall cooperate in filing all necessary Tax Returns under applicable Law with respect to Transfer Taxes.

Section 6.4Tax Contests. Ashford Select TRS shall inform the applicable Seller of the commencement of any audit, examination or proceeding (“Tax Contest”) relating in whole or in part to Taxes for which Ashford Select TRS may be entitled to indemnity from Sellers hereunder. With respect to any Tax Contest for which any Seller acknowledges in writing that such Seller is liable under Article VII for any and all Losses relating thereto, such Seller shall be entitled to control, in good faith, all proceedings taken in connection with such Tax Contest; provided, however, that (x) each Seller shall promptly notify Ashford Select TRS in writing of any intention to control such Tax Contest, (y) in the case of a Tax Contest relating to Taxes of any of the Purchased Entities or Subsidiary Entities for a Tax period that includes but does not end on the Closing Date, the related Seller and Ashford Select TRS shall jointly control all proceedings taken in connection with any such Tax Contest and (z) if any Tax Contest could reasonably be expected to have an adverse effect on Ashford Select TRS, any of the Purchased Entities, Subsidiary Entities or any of their Affiliates in any Tax period beginning after the Closing Date, the Tax Contest shall not be settled or resolved without the relevant Ashford Select TRS consent, which consent shall not be unreasonably withheld or delayed. Notwithstanding the foregoing, if notice is given to any Seller of the commencement of any Tax Contest and such Seller does not, within ten (10) Business Days after notice is given by

14

Ashford Select TRS, give notice to Ashford Select TRS of its election to assume the defense thereof (and in connection therewith, acknowledge in writing the indemnification obligation hereunder of such Seller), such Seller shall be bound by any determination made in such Tax Contest or any compromise or settlement thereof effected by Ashford Select TRS. The failure of Ashford Select TRS to give reasonably prompt notice of any Tax Contest shall not release, waive or otherwise affect any Seller’s obligation with respect thereto except to the extent that such Seller can demonstrate actual loss and prejudice as a result of such failure. Ashford Select TRS and the Purchased Entities and Subsidiary Entities shall use their reasonable efforts to provide Sellers with such assistance as may be reasonably requested by Sellers in connection with a Tax Contest controlled solely or jointly by a Seller.

ARTICLE VIIINDEMNITY OBLIGATIONS

Section 7.1Indemnity.

(a)From and after the Closing Date, each party hereto (each of which is an “Indemnifying Party”) shall indemnify and hold harmless the other party and its Affiliates (each of which is an “Indemnified Party”) from and against any and all charges, complaints, claims, actions, causes of action, losses, damages, liabilities and expenses of any nature whatsoever (each, a “Claim”), including amounts paid in settlement, reasonable attorneys’ fees, costs of investigation, costs of investigative judicial or administrative proceedings or appeals therefrom and costs of attachment or similar bonds (collectively, “Losses”) arising out of or relating to, asserted against, imposed upon or incurred by the Indemnified Party in connection with or as a result of any breach of a representation, warranty or covenant of the Indemnifying Party contained in this Agreement or in any schedule, exhibit, certificate or affidavit or any other agreement, document or instrument delivered by the Indemnifying Party pursuant to this Agreement (to the extent not known by Indemnified Party prior to Closing Date). In addition (a) Ashford Select TRS shall indemnify Sellers and hold them harmless from and against any Losses arising from the operation of the business of Ashford Select TRS, the Purchased Entities or the Subsidiary Entities, or the ownership and operation of the assets of such entities for the period from and after the Closing, and (b) Sellers shall jointly and severally indemnify Ashford Select TRS, the Purchased Entities and the Subsidiary Entities and hold them harmless from and against any Losses arising from the operation of the business of any Seller, the Purchased Entities or the Subsidiary Entities, or the ownership and operation of the assets of such entities for the period prior to the Closing; provided, however, that: (i) Ashford Select TRS shall not have any obligation under this Article to indemnify any Indemnified Party against any Losses to the extent that such Losses arise by virtue of any Seller’s breach of this Agreement, gross negligence, willful misconduct or fraud; and (ii) no Seller shall have any obligation under this Article to indemnify any Indemnified Party against any Losses to the extent that such Losses arise by virtue of (A) any diminution in value of the Properties, or (B) Ashford Select TRS’s breach of this Agreement, gross negligence, willful misconduct or fraud; and

15

(b)(%3) The Sellers shall jointly and severally indemnify each of Ashford Select TRS, the Purchased Entities and the Subsidiary Entities and hold them harmless from and against all Losses arising from: (A) all Taxes of the Purchased Entities, Subsidiary Entities and the Properties for all Tax periods ending on or before the Closing Date, (B) with respect to any Tax period including but not ending on the Closing Date, all Taxes of the Purchased Entities, Subsidiary Entities and the Properties attributable to the portion of such Tax period that ends on and includes the Closing Date, and (C) all Taxes of any Person imposed on the Purchased Entities or Subsidiary Entities as a transferee or successor, by contract or pursuant to any Law (including, but not limited to, Treasury Regulations Section 1.1502-6 and V.T.C.A., Tax Code, Chapter 171) with respect to obligations or relationships existing on or prior to the Closing Date or by agreements entered into or transactions entered into on or prior to the Closing Date.

(i)No Seller shall have any liability for any Taxes or Losses with respect to Taxes that are attributable to any transaction outside the ordinary course of business of the Purchased Entities or Subsidiary Entities entered into by Ashford Select TRS or its Affiliates or at the direction of Ashford Select TRS or its Affiliates that occurs on or after the Closing.

(ii)No Seller shall have any liability to Ashford Select TRS for any Losses attributable to Taxes with respect to (A) any Tax period beginning after the Closing Date, or (B) any portion of a straddle period (a Tax period which includes but does not end on the Closing Date) beginning after the Closing Date.

Section 7.2Notice of Claims. At the time when any Indemnified Party learns of any potential Claim against the Indemnifying Party it will promptly give written notice (a “Claim Notice”) to the Indemnifying Party; provided that failure to do so shall not prevent recovery under this Agreement, except to the extent that the Indemnifying Party shall have been materially prejudiced by such failure. Each Claim Notice shall describe in reasonable detail the facts known to such Indemnified Party giving rise to such Claim, and the amount or good faith estimate of the amount of Losses arising therefrom. Unless prohibited by Law, such Indemnified Party shall deliver to the Indemnifying Party, promptly after such Indemnified Party’s receipt thereof, copies of all notices and documents (including court papers) received by such Indemnified Party relating to claims asserted by third parties (“Third Party Claims”). Any Indemnified Party may at its option demand indemnity under this Article VII as soon as a Claim has been threatened by a third party, regardless of whether an actual Loss has been suffered, so long as such Indemnified Party shall in good faith determine that such claim is not frivolous and that such Indemnified Party may be liable for, or otherwise incur, a Loss as a result thereof.

Section 7.3Third Party Claims. The Indemnifying Party shall be entitled, at its own expense, to assume and control the defense of any Claims based on Third Party Claims, through counsel chosen by the Indemnifying Party and reasonably acceptable to such Indemnified Party (or any Person authorized by such Indemnified Party to act on its behalf), if it gives written notice of its intention to do so to such Indemnified Party within 30 days of the receipt of the applicable Claim Notice; provided, however, that such Indemnified Party may at all times participate in such defense

16

at its expense. Without limiting the foregoing, in the event that the Indemnifying Party exercises the right to undertake any such defense against a Third Party Claim, such Indemnified Party shall cooperate with the Indemnifying Party in such defense and make available to the Indemnifying Party (unless prohibited by Law), at the Indemnifying Party’s expense, all witnesses, pertinent records, materials and information in such Indemnified Party’s possession or under such Indemnified Party’s control relating thereto as is reasonably required by the Indemnifying Party. No compromise or settlement of such Third Party Claim may be effected by either such Indemnified Party, on the one hand, or the Indemnifying Party, on the other hand, without the other’s consent (which consent shall not be unreasonably withheld, conditioned or delayed) unless (i) there is no finding or admission of any violation of Law and no effect on any other claims that may be made against such other party and (ii) each Indemnified Party that is party to such other claim is released from all liability with respect to such other claim.

Section 7.4Procedure for Indemnification. Upon determination of the amount of a Claim that is binding on both the Indemnifying Party and the Indemnified Party, the Indemnifying Party shall, within ten (10) days of the date such amount is determined, pay the amount of such Claim by wire transfer of immediately available funds to an account designated by the Indemnified Party.

Section 7.5Expiration.

(a)Subject to the limitations set forth in Section 7.5(b) below, all representations, warranties, covenants and agreements (including those relating to indemnification in Section 7.1) made herein shall survive the Closing Date.

(b)All representations, warranties and covenants of the Indemnifying Party contained in this Agreement shall survive until twelve months after the Closing Date (the “Expiration Date”); provided, however, the representations and warranties set forth in Section 4.11 with respect to Taxes and Section 4.16 with respect to material documents shall survive until the expiration of the applicable statute of limitations for making a claim for such matters. If written notice of a claim in accordance with the provisions of this Article VII has been given prior to the Expiration Date, then the relevant representation, warranty and covenant shall survive, but only with respect to such specific claim, until such claim has been finally resolved. Any claim for indemnification not so asserted in writing by the Expiration Date may not thereafter be asserted and shall forever be waived.

Section 7.6Limitations on Indemnification.

(a)Except as provided in subparagraph (b) below, no Seller shall have any liability under Section 7.1 for any Losses hereunder (i) unless and until the aggregate total amount of all such Losses for which Sellers would, but for this provision, be liable exceeds, on a cumulative basis, $1,000,000.00, and (ii) in excess of, on a cumulative basis, eight percent (8%) of the Purchase Price.

(b)The limitations in subparagraph (a) above shall not apply to any Losses resulting from Claims made under Section 7.1(b)(i).

17

Section 7.7Exclusive Remedy. In furtherance of the foregoing, the Indemnified Parties hereby waive to the fullest extent permitted under applicable Law, any and all rights, claims and causes of action (other than claims of, or causes of action arising from, fraud) it may have against the Indemnifying Party arising under or based upon any federal, state, local or foreign Law, other than the right to seek indemnity pursuant to this Article VII. The foregoing sentence shall not limit the Indemnified Party’s right to specific performance or injunctive relief in connection with the breach by the Indemnifying Party of the provisions of this Agreement.

ARTICLE VIIIGENERAL PROVISIONS

Section 8.1Additional Definitions. For the purposes of this Agreement, the following terms shall have the following meanings:

(a)“Affiliate” means, with respect to any Person, a Person that, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with the specified Person. For the purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”) as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise; provided, however, for purposes of this Agreement, Ashford Select TRS is deemed not to be an Affiliate of any Seller.

(b)“Business Day” means any day that is not a Saturday, Sunday or legal holiday in the State of Texas.

(c)“Code” means the Internal Revenue Code of 1986, as amended, together with the rules and regulations promulgated or issued thereunder.

(d)“Environmental Law” means all federal, state and local Laws governing pollution or the protection of human health or the environment.

(e)“Governmental Authority” means any government or agency, bureau, board, commission, court, department, official, political subdivision, tribunal or other instrumentality of any government, whether federal, state or local, domestic or foreign.

(f)“Law” means laws, statutes, rules, regulations, codes, Orders, ordinances, judgments, injunctions, decrees and policies of any Governmental Authority.

(g)“Liens” means all pledges, claims, liens, charges, restrictions, controls, easements, rights of way, exceptions, reservations, leases, licenses, grants, covenants and conditions, Encumbrances and security interests of any kind or nature whatsoever.

18

(h)“Order” means any order, writ, judgment, injunction, decree, ruling, assessment, stipulation, determination or award entered by or with any court or other Governmental Authority or arbitrator.

(i)“Person” means an individual, corporation, partnership, limited liability company, joint venture, association, trust, unincorporated organization or other entity.

(j)“Subsidiary” of any Person means any corporation, partnership, limited liability company, joint venture, trust or other legal entity of which such Person owns (either directly or through or together with another Subsidiary of such Person) either (i) a general partner, managing member or other similar interest or (ii) (A) 10% or more of the voting power of the voting capital stock or other equity interests or (B) 10% or more of the outstanding voting capital stock or other voting equity interests of such corporation, partnership, limited liability company, joint venture, trust or other legal entity.

(k)“Taxes” means all federal, state, local and foreign income, property, withholding, sales, franchise, employment, excise and other taxes, tariffs or governmental charges of any nature whatsoever, including estimated taxes, together with penalties, interest or additions to tax with respect thereto.

(l)“Tax Return” means any return, declaration, report, claim for refund, or information return or statement related to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

Section 8.2Tax Agreement. Omitted

Section 8.3Amendment. Any amendment hereto shall be in writing and signed by all parties hereto. No waiver of any of the provisions of this Agreement shall be valid unless in writing and signed by the party against whom enforcement is sought.

Section 8.4Entire Agreement; Counterparts; Applicable Law. This Agreement (a) constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof, (b) may be executed in several counterparts, each of which will be deemed an original and all of which shall constitute one and the same instrument and (c) shall be governed in all respects, including validity, interpretation and effect, by the laws of the State of Texas without giving effect to the conflict of law provisions thereof.

Section 8.5Assignability. This Agreement shall be binding upon, and shall be enforceable by and inure to the benefit of, the parties hereto and their respective heirs, legal representatives, successors and assigns; provided, however, that this Agreement may not be assigned (except by operation of law) by any party without the prior written consent of the other parties, and any attempted assignment without such consent shall be void and of no effect.

19

Section 8.6Titles. The titles and captions of the Articles, Sections and paragraphs of this Agreement are included for convenience of reference only and shall have no effect on the construction or meaning of this Agreement.

Section 8.7Third Party Beneficiary. No provision of this Agreement is intended, nor shall it be interpreted, to provide or create any third party beneficiary rights or any other rights of any kind in any customer, Affiliate, stockholder, partner, director, officer or employee of any party hereto or any other Person.

Section 8.8Severability. If any provision of this Agreement, or the application thereof, is for any reason held to any extent to be invalid or unenforceable, the remainder of this Agreement and application of such provision to other Persons or circumstances will be interpreted so as to reasonably effect the intent of the parties hereto. The parties further agree to replace such void or unenforceable provision of this Agreement with a valid and enforceable provision that will achieve, to the extent possible, the economic, business and other purposes of the void or unenforceable provision and to execute any amendment, consent or agreement deemed necessary or desirable by the parties to effect such replacement.

Section 8.9Equitable Remedies. The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof in any federal or state court located in the State of Texas (as to which the parties agree to submit to jurisdiction for the purposes of such action), this being in addition to any other remedy to which they are entitled at law or in equity.]

Section 8.10Attorneys’ Fees. In connection with any litigation or a court proceeding arising out of this Agreement, the prevailing party shall be entitled to recover all costs incurred, including reasonable attorneys’ fees and legal assistants’ fees and costs whether incurred prior to trial, at trial or on appeal.

Section 8.11Notices. Any notice or demand which must or may be given under this Agreement or by law shall, except as otherwise provided, shall be in writing and shall be deemed to have been given (i) five (5) Business Days following sending by registered or certified mail, postage prepaid, (ii) when sent, if sent by facsimile, (iii) when delivered, if delivered personally to the intended recipient, and (iv) one (1) Business Day following sending by overnight delivery via a national courier service and, if each case, addressed to a party at the following address for such party.

(a) in the case of a notice to Ashford Select TRS, at the following address and telecopy number:

Ashford Select TRS Corporation

c/o Ashford Hospitality Advisors LLC

14185 Dallas Parkway, Suite 1100

Dallas, Texas 75254

20

Attention: Chief Operating Officer

Phone: (972) 496-9600

Fax: (972) 490-9605

(b) in the case of a notice to any Seller, at the following address and telecopy number:

Ashford TRS Corporation

c/o Ashford Hospitality Trust, Inc.

14185 Dallas Parkway, Suite 1100

Dallas, Texas 75254

Phone: (972) 490-9600

Fax: (972) 490-9605

(c) in each case, with a copy to:

Andrews Kurth LLP

1717 Main Street, Suite 1700

Dallas, TX 75201

Attention: Muriel C. McFarling

Section 8.12Computation of Time. Any time period provided for herein which shall end on a Saturday, Sunday or legal holiday shall extend to 5:00 p.m. of the next full Business Day. All times are Central Standard Time.

Section 8.13Survival. It is the express intention and agreement of the parties hereto that the representations, warranties and covenants of Sellers and Ashford Select TRS set forth in this Agreement shall survive the consummation of the transactions contemplated hereby as set forth in Section 7.5(b).

Section 8.14Time of the Essence. Time is of the essence with respect to all obligations of Sellers, and Ashford Select TRS under this Agreement.

[Signature Pages to Follow]

21

IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement, or caused the Agreement to be duly executed on its behalf, as of the date first above written.

SELLERS:

ASHFORD TRS CORPORATION

By: /s/ DERIC EUBANKS

Name: Deric Eubanks

Title: President

ASHFORD TRS VI CORPORATION

By: /s/ DERIC EUBANKS

Name: Deric Eubanks

Title: President

ASHFORD SELECT TRS:

ASHFORD SELECT TRS CORPORATION

By: /s/ DERIC EUBANKS

Name: Deric Eubanks

Title: President

[Signature Page to the Purchase and Sale Agreement – Ashford Select TRS]

Exhibit A

Properties

Property	Seller	Purchased Entity	Equity Interest	Assignee	Seller’s Relationship with Equity Interest and the Property
Courtyard Columbus, 3888 Mimosa Drive Columbus, IN Springhill Suites Linthium (BWI Airport), 899 Elkridge Landing Rd., BWI Airport, Maryland Residence Inn Las Vegas, 370 Hughes Center Drive Las Vegas, NV Springhill Suites Gaithersburg, 9715 Washingtonian Blvd. Gaithersburg, MD Springhill Suites Centreville, 5920 Trinity Parkway Centreville, VA	Ashford TRS Corporation	Ashford TRS Pool B Junior Holder LLC	100% member interest	Ashford Select TRS Corporation	;

Exhibit A-1

Property	Seller	Purchased Entity	Equity Interest	Assignee	Seller’s Relationship with Equity Interest and the Property
Courtyard Louisville, 819 Phillips Lane Louisville, KY Residence Inn Lake Buena Vista, 11420 Marbella Palms Ct. Orlando FL Courtyard Ft. Lauderdale, 2000 N. Commerce Parkway Ft. Lauderdale, FL	Ashford TRS Corporation	Ashford TRS Pool C1 Junior Holder LLC	100% member interest	Ashford Select TRS Corporation	Ashford TRS Corporation owns 100% of Ashford TRS Pool C1 Junior Holder LLC, which owns 100% of Ashford TRS Pool C1 Junior Mezz LLC, which owns 100% of Ashford TRS Pool C1 Senior Mezz LLC, which owns 100% of Ashford TRS Pool C1 LLC, which is the operating lessee for Courtyard Louisville, Kentucky; Residence Inn Buena Vista, Florida; and Courtyard, Ft. Lauderdale, Florida
Residence Inn Orlando (Sea World), 11000 Westwood Blvd. Orlando, FL Residence Inn Salt Lake City, 6425 South 3000 East Cottonwood, UT Courtyard Overland Park, 11001 Woodson Street I-435 and Nall Overland Park, KS	Ashford TRS VI Corporation	Ashford TRS Six LLC	100% member interest	Ashford Select TRS Corporation	Ashford TRS VI Corporation owns 100% of Ashford TRS Six LLC, which is the operating lessee for Residence Inn Orlando (Sea World), Florida; Residence Inn, Salt Lake City, Utah; and Courtyard, Overland Park, Kansas.
Courtyard Palm Desert, 74895 Frank Sinatra Drive Palm Desert, CA Residence Inn, Palm Desert, 38305 Cook Street, Palm Desert, CA	Ashford TRS VI Corporation	Ashford TRS Seven LLC	100% member interest	Ashford Select TRS Corporation	Ashford TRS VI Corporation owns 100% of Ashford TRS Seven LLC, which is the operating lessee for Courtyard, Palm Desert, California and Residence Inn, Palm Desert, California

Exhibit A-2

Property	Seller	Purchased Entity	Equity Interest	Assignee	Seller’s Relationship with Equity Interest and the Property
Residence Inn Jacksonville, 10551 Deerwood Park Blvd Jacksonville, FL	Ashford TRS VI Corporation	Ashford TRS Jacksonville IV LLC	100% member interest	Ashford Select TRS Corporation	Ashford TRS VI Corporation owns 100% of Ashford TRS Jacksonville IV LLC, which is the operating lessee for Residence Inn Jacksonville

Exhibit A-3

Exhibit B

Formation Transactions

Exhibit B-1

Exhibit C

Allocation of Purchase Price

Pursuant to Section 1.2 of this Agreement, the Purchase Price for the Equity Interests in shall be allocated as follows:

Ashford TRS Corporation: $______________________

Ashford TRS VI Corporation: $_______________________

Exhibit C-1

Exhibit D

List of Subsidiaries of Purchased Entities

Purchased Entities	Subsidiary Entities
Ashford TRS Pool B Junior Holder LLC	Ashford TRS Pool B Junior Mezz LLC Ashford TRS Pool B Senior Mezz LLC Ashford TRS Pool B 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 C1 LLC
Ashford TRS Six LLC	None
Ashford TRS Seven LLC	None
Ashford TRS Jacksonville IV LLC	None

Exhibit D-1

Exhibit E

Form of Assignment and Assumption Agreement

Exhibit E-1

SCHEDULE 4.14

Existing Loans

1. Loan in the original principal amount of $10,800,000 made by German American Capital Corporation, as lender, to Ashford Jacksonville IV LC, as borrower, on December 20, 2013 with respect to the Residence Inn, Jacksonville, Florida.

2. Loan in the original principal amount of $54,900,000 made by Bank of America, N.A., as lender, to Ashford Overland Park Limited Partnership, Ashford Orlando Sea World Limited Partnership and Ashford Salt Lake Limited Partnership, on January 2, 2015, with respect to the Courtyard Overland Park, Overland Park, Kansas, Residence Inn Orlando Sea World, Orlando, Florida and Residence Inn Cottonwood, Salt Lake City, Utah.

3. Loan in the original principal amount of $24,500,000 made by Bank of America, N.A., as lender, to Ashford Ruby Palm Desert I Limited Partnership, on January 2, 2015, with respect to the Courtyard Palm Desert, California and the Residence Inn Palm Desert, California.

4. Loan in the original principal amount of $67,520,000 made by Morgan Stanley Bank, N.A., as lender to Ashford Louisville LP, Ashford Buena Vista LP, Ashford Ft. Lauderdale Weston I LP, Ashford Ft. Lauderdale Weston II LP, and Ashford Ft. Lauderdale Weston III LP, as borrower, on July 25, 2014, with respect to the Courtyard Louisville, Residence Inn Buena Vista and Courtyard Ft. Lauderdale, as amended to change the principal amount to $59,080,000.

5. Loan in the original principal amount of $8,440,000 made by Morgan Stanley Bank, N.A., as lender to Ashford Pool C1 Senior Mezz LLC, on August 24, 2014.

6. Loan in the original principal amount of $39,525,000 made by Morgan Stanley Bank, N.A., as lender to Ashford Gaithersburg Limited Partnership, Ashford Centerville Limited Partnership, Ashford Tipton Lakes LP, Ashford LV Hughes Center LP and Ashford BWI Airport LP, as borrower, on July 25, 2014, with respect to the Courtyard Columbus, Indiana, Springhill Suites BWI, Maryland, Residence Inn Las Vegas, Nevada, Springhill Suites Gaithersburg, Virginia and Springhill Suites Centreville, Virginia, to change the principal amount to $48,500,000.

7. Loan in the original principal amount of $11,000,000 made by Morgan Stanley Bank, N.A. as lender to Ashford Pool B Senior Mezz LLC, as borrower, on July 25, 2014, as amended to change the principal amount to $2,025,000.

8. Loan in the original principal amount of $12,375,000 made by Morgan Stanley Bank, N.A. as lender to Ashford Pool B Junior Mezz LLC, as borrower, on July 25, 2014.

Schedule 4.14 - 1

Exhibit D-2

EX-10.4.1

EXHIBIT 10.4.1

May 8, 2015    

Ashford TRS Corporation

14185 Dallas Parkway, Suite 1100

Dallas, TX 75254

Ashford TRS VI Corporation

14185 Dallas Parkway, Suite 1100

Dallas, TX 75254

Ladies and Gentlemen:

Reference is made to that certain Purchase and Sale Agreement (the “Agreement”), dated as of February 18, 2015, by and between Ashford TRS Corporation, Ashford TRS VI Corporation and Ashford Select TRS Corporation. Capitalized terms not otherwise defined in this letter have the meanings assigned in the Agreement.

The undersigned hereby notify you, pursuant to Section 2.3 of the Agreement, that the Agreement is terminated and of no further force and effect.

Very truly yours,

ASHFORD SELECT TRS CORPORATION

By: /s/ DERIC EUBANKS

Name: Deric Eubanks

Title: President

EX-12

EXHIBIT 12

ASHFORD HOSPITALITY TRUST, INC.

STATEMENT REGARDING COMPUTATION OF RATIOS OF EARNINGS TO COMBINED FIXED CHARGES

(dollars in thousands)

	Three Months Ended		Year Ended December 31,
	March 31, 2015		2014			2013			2012			2011			2010
Earnings
Income (loss) from continuing operations before provision for income taxes and redeemable noncontrolling interests	$	368,762	$	(40,465	)	$	(46,949	)	$	(56,385	)	$	9,039		$	(26,914	)
Amount recorded for (earnings) loss in unconsolidated entities	6,622		(2,495		)	23,404			20,833			(14,528		)	20,265
Add:
Distributions from equity investment in unconsolidated entities	249		995			—			—			—			492
Interest on indebtedness	31,629		107,598			133,697			140,066			134,585			143,264
Amortization of debt expense and premium	3,006		7,237			7,772			6,194			4,648			5,838
Interest component of operating leases	46		115			341			354			385			525
	$	410,314	$	72,985		$	118,265		$	111,062		$	134,129		$	143,470
Fixed charges
Interest on indebtedness	$	31,629	$	107,598		$	133,697		$	140,066		$	134,585		$	143,264
Amortization of debt expense and premium	3,006		7,237			7,772			6,194			4,648			5,838
Interest component of operating leases	46		115			341			354			385			525
Dividends to Class B unit holders	703		2,879			2,943			2,943			2,943			2,943
	$	35,384	$	117,829		$	144,753		$	149,557		$	142,561		$	152,570
Preferred stock dividends
Preferred Series A	$	886	$	3,542		$	3,542		$	3,516		$	3,180		$	3,180
Preferred Series B-1	—		—			—			—			1,374			4,143
Preferred Series D	5,000		20,002			20,002			19,869			18,940			13,871
Preferred Series E	2,604		10,418			10,418			10,417			6,019			—
	$	8,490	$	33,962		$	33,962		$	33,802		$	29,513		$	21,194
Combined fixed charges and preferred stock dividends	$	43,874	$	151,791		$	178,715		$	183,359		$	172,074		$	173,764
Ratio of earnings to fixed charges	11.60
Ratio of earnings to combined fixed charges and preferred stock dividends	9.35
Deficit (Fixed charges)			$	44,844		$	26,488		$	38,495		$	8,432		$	9,100
Deficit (Combined fixed charges and preferred stock dividends)			$	78,806		$	60,450		$	72,297		$	37,945		$	30,294

EX-31.1

EXHIBIT 31.1

CERTIFICATION

I, Monty J. Bennett, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q 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: May 11, 2015

/s/ MONTY J. BENNETT

Monty J. Bennett

Chief Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATION

I, Deric S. Eubanks, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q 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: May 11, 2015

/s/ DERIC S. EUBANKS

Deric S. Eubanks

Chief Financial Officer

EX-32.1

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 Quarterly Report of Ashford Hospitality Trust, Inc. (the “Company”) on Form 10-Q for the quarterly period ended March 31, 2015, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Monty J. Bennett, 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: May 11, 2015

/s/ MONTY J. BENNETT

Monty J. Bennett

Chief Executive Officer

EX-32.2

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 Quarterly Report of Ashford Hospitality Trust, Inc. (the “Company”) on Form 10-Q for the quarterly period ended March 31, 2015, 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: May 11, 2015

/s/ DERIC S. EUBANKS

Deric S. Eubanks

Chief Financial Officer

XML

Note Receivable (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Accounts, Notes, Loans and Financing Receivable [Line Items]
Notes receivable	$ 3,599	$ 3,553
Allowance for doubtful notes receivable	7,416	7,522
Mezzanine Loan [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of mezzanine loans	1	1
Notes receivable	3,600	3,600
Allowance for doubtful notes receivable	$ 7,416	$ 7,522
Number of hotel properties held as collateral	1	1
Interest Rate	6.09%	6.09%

XML

Commitments and Contingencies (Narrative) (Details) (USD $)	3 Months Ended	0 Months Ended	3 Months Ended	9 Months Ended	12 Months Ended
	Mar. 31, 2015	Jun. 30, 2014	Mar. 31, 2014	Mar. 31, 2015	Dec. 31, 2014	Dec. 31, 2006
Potential Pension Liabilities [Member]
Commitments and Contingencies [Line Items]
Unfunded pension liabilities at acquisition						$ 0
Net amount of pension payments on settlement agreement paid by hotel manager	84,000
Term of Pension Liability	20 years
Unfunded pension liabilities amount received by the Hotel Manager on the loss of suit	1,700,000
Monthly pension payments	100,000
Accrued unfunded pension liabilities	1,600,000			1,600,000
Litigation [Member]
Commitments and Contingencies [Line Items]
Damages awarded		10,800,000
Interest on litigation award			24,000		707,000
Total litigation expense				11,900,000
Loss contingency accrual					400,000
Restricted Cash [Member]
Commitments and Contingencies [Line Items]
Escrow reserve for capital improvements as percentage of gross revenues, Minimum	3.00%
Escrow reserve for capital improvements as percentage of gross revenues, Maximum	6.00%
Franchise Fees [Member]
Commitments and Contingencies [Line Items]
Franchisor royalty fees percent of gross room revenue, minimum	2.50%			2.50%
Franchisor royalty fees percent of gross room revenue, Maximum	6.00%			6.00%
Marketing reservation and other fees, Minimum	1.00%			1.00%
Marketing reservation and other fees, Maximum	6.00%			6.00%
Franchise fees incurred	11,900,000		8,900,000
Management Fees [Member]
Commitments and Contingencies [Line Items]
Payment of monthly property management fees, Minimum	$ 10,000
Property management fee as percentage of gross revenue used if greater than $10,000 (CPI adjusted since 2003)	3.00%
Property management fee as percentage of gross revenue, Minimum	1.50%
Property management fee as percentage of gross revenue, Maximum	7.00%
Portion of project management fees to project costs	4.00%

XML

Fair Value Measurements (Assets and Liabilities Measured at Fair Value on a Recurring Basis) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Derivative Assets:
Derivative assets, net	$ 917	$ 182
Fair Value Measurements Recurring [Member]
Non-derivative Assets:
Assets, fair value disclosure, Total	73,344	63,399
Non-derivative liabilities
Liabilities, fair value disclosure, Total	(12,771)	(6,201)
Assets and liabilities, fair value disclosure	60,573	57,198
Fair Value Measurements Recurring [Member] | Equity Securities [Member]
Non-derivative Assets:
Non-derivative assets	53,155	57,941
Non-derivative liabilities
Non-derivative Liabilities:	(1,427)
Fair Value Measurements Recurring [Member] | Equity Securities [Member] | Short [Member]
Non-derivative liabilities
Non-derivative Liabilities:		(17)
Fair Value Measurements Recurring [Member] | U.S. Treasury Securities [Member]
Non-derivative Assets:
Non-derivative assets	18,070	4,622
Fair Value Measurements Recurring [Member] | Margin Account Balance [Member]
Non-derivative liabilities
Non-derivative Liabilities:	(10,297)	(5,003)
Fair Value Measurements Recurring [Member] | Interest Rate Derivatives [Member] | Not Designated As Hedging Instrument [Member]
Derivative Assets:
Derivative assets, net	414	182
Fair Value Measurements Recurring [Member] | Call Option [Member]
Derivative Assets:
Derivative assets, net	267	1
Fair Value Measurements Recurring [Member] | Call Option [Member] | Short [Member]
Derivative Liabilities:
Derivative liabilities	(694)	(781)
Fair Value Measurements Recurring [Member] | Credit Default Swaps [Member]
Derivative Assets:
Derivative assets, net	503
Derivative Liabilities:
Derivative liabilities		(184)
Fair Value Measurements Recurring [Member] | Put Option [Member]
Derivative Assets:
Derivative assets, net	935	653
Fair Value Measurements Recurring [Member] | Put Option [Member] | Short [Member]
Derivative Liabilities:
Derivative liabilities	(353)	(216)
Fair Value Measurements Recurring [Member] | Quoted Market Prices (Level 1) [Member]
Non-derivative Assets:
Assets, fair value disclosure, Total	72,427	63,217
Non-derivative liabilities
Liabilities, fair value disclosure, Total	(12,771)	(6,017)
Assets and liabilities, fair value disclosure	59,656	57,200
Fair Value Measurements Recurring [Member] | Quoted Market Prices (Level 1) [Member] | Equity Securities [Member]
Non-derivative Assets:
Non-derivative assets	53,155	57,941
Non-derivative liabilities
Non-derivative Liabilities:	(1,427)
Fair Value Measurements Recurring [Member] | Quoted Market Prices (Level 1) [Member] | Equity Securities [Member] | Short [Member]
Non-derivative liabilities
Non-derivative Liabilities:		(17)
Fair Value Measurements Recurring [Member] | Quoted Market Prices (Level 1) [Member] | U.S. Treasury Securities [Member]
Non-derivative Assets:
Non-derivative assets	18,070	4,622
Fair Value Measurements Recurring [Member] | Quoted Market Prices (Level 1) [Member] | Margin Account Balance [Member]
Non-derivative liabilities
Non-derivative Liabilities:	(10,297)	(5,003)
Fair Value Measurements Recurring [Member] | Quoted Market Prices (Level 1) [Member] | Interest Rate Derivatives [Member] | Not Designated As Hedging Instrument [Member]
Derivative Assets:
Derivative assets, net	0	0
Fair Value Measurements Recurring [Member] | Quoted Market Prices (Level 1) [Member] | Call Option [Member]
Derivative Assets:
Derivative assets, net	267	1
Fair Value Measurements Recurring [Member] | Quoted Market Prices (Level 1) [Member] | Call Option [Member] | Short [Member]
Derivative Liabilities:
Derivative liabilities	(694)	(781)
Fair Value Measurements Recurring [Member] | Quoted Market Prices (Level 1) [Member] | Credit Default Swaps [Member]
Derivative Assets:
Derivative assets, net	0
Derivative Liabilities:
Derivative liabilities		0
Fair Value Measurements Recurring [Member] | Quoted Market Prices (Level 1) [Member] | Put Option [Member]
Derivative Assets:
Derivative assets, net	935	653
Fair Value Measurements Recurring [Member] | Quoted Market Prices (Level 1) [Member] | Put Option [Member] | Short [Member]
Derivative Liabilities:
Derivative liabilities	(353)	(216)
Fair Value Measurements Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member]
Non-derivative Assets:
Assets, fair value disclosure, Total	1,745	182
Non-derivative liabilities
Liabilities, fair value disclosure, Total	0	379
Assets and liabilities, fair value disclosure	1,745	561
Fair Value Measurements Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | U.S. Treasury Securities [Member]
Non-derivative Assets:
Non-derivative assets	0
Fair Value Measurements Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Equity and U.S Treasury Securities [Member]
Non-derivative Assets:
Non-derivative assets		0
Fair Value Measurements Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Margin Account Balance [Member]
Non-derivative liabilities
Non-derivative Liabilities:	0	0
Fair Value Measurements Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Interest Rate Derivatives [Member] | Not Designated As Hedging Instrument [Member]
Derivative Assets:
Derivative assets, net	414	182
Fair Value Measurements Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Call Option [Member] | Short [Member]
Derivative Liabilities:
Derivative liabilities	0	0
Fair Value Measurements Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Credit Default Swaps [Member]
Derivative Assets:
Derivative assets, net	1,331
Derivative Liabilities:
Derivative liabilities		379
Fair Value Measurements Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Put and Call Options [Member]
Derivative Assets:
Derivative assets, net		0
Fair Value Measurements Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Put Option [Member] | Short [Member]
Derivative Liabilities:
Derivative liabilities	0	0
Fair Value Measurements Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Non-derivative Assets:
Assets, fair value disclosure, Total	0	0
Non-derivative liabilities
Liabilities, fair value disclosure, Total	0	0
Assets and liabilities, fair value disclosure	0	0
Fair Value Measurements Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | U.S. Treasury Securities [Member]
Non-derivative Assets:
Non-derivative assets	0
Fair Value Measurements Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Equity and U.S Treasury Securities [Member]
Non-derivative Assets:
Non-derivative assets		0
Fair Value Measurements Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Margin Account Balance [Member]
Non-derivative liabilities
Non-derivative Liabilities:	0
Fair Value Measurements Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Interest Rate Derivatives [Member] | Not Designated As Hedging Instrument [Member]
Derivative Assets:
Derivative assets, net	0	0
Fair Value Measurements Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Call Option [Member]
Derivative Assets:
Derivative assets, net	0
Fair Value Measurements Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Credit Default Swaps [Member]
Derivative Assets:
Derivative assets, net	0
Derivative Liabilities:
Derivative liabilities		0
Fair Value Measurements Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Put and Call Options [Member]
Derivative Assets:
Derivative assets, net		0
Fair Value Measurements Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | Put Option [Member] | Short [Member]
Derivative Liabilities:
Derivative liabilities		0
Fair Value Measurements Recurring [Member] | Counterparty and Cash Collateral Netting [Member]
Non-derivative Assets:
Assets, fair value disclosure, Total	(828)	0
Non-derivative liabilities
Liabilities, fair value disclosure, Total	0	(563)
Assets and liabilities, fair value disclosure	(828)	(563)
Fair Value Measurements Recurring [Member] | Counterparty and Cash Collateral Netting [Member] | U.S. Treasury Securities [Member]
Non-derivative Assets:
Non-derivative assets	0
Fair Value Measurements Recurring [Member] | Counterparty and Cash Collateral Netting [Member] | Equity and U.S Treasury Securities [Member]
Non-derivative Assets:
Non-derivative assets		0
Fair Value Measurements Recurring [Member] | Counterparty and Cash Collateral Netting [Member] | Margin Account Balance [Member]
Non-derivative liabilities
Non-derivative Liabilities:	0	0
Fair Value Measurements Recurring [Member] | Counterparty and Cash Collateral Netting [Member] | Interest Rate Derivatives [Member] | Not Designated As Hedging Instrument [Member]
Derivative Assets:
Derivative assets, net		0
Fair Value Measurements Recurring [Member] | Counterparty and Cash Collateral Netting [Member] | Call Option [Member]
Derivative Assets:
Derivative assets, net	0
Fair Value Measurements Recurring [Member] | Counterparty and Cash Collateral Netting [Member] | Call Option [Member] | Short [Member]
Derivative Liabilities:
Derivative liabilities		0
Fair Value Measurements Recurring [Member] | Counterparty and Cash Collateral Netting [Member] | Credit Default Swaps [Member]
Derivative Assets:
Derivative assets, net	(828)
Derivative Liabilities:
Derivative liabilities		(563)
Fair Value Measurements Recurring [Member] | Counterparty and Cash Collateral Netting [Member] | Put Option [Member] | Short [Member]
Derivative Liabilities:
Derivative liabilities		$ 0

XML

Segment Reporting (Details)	3 Months Ended
	Mar. 31, 2015 segment
Segment Reporting [Abstract]
Number of operating segments	1

XML

Derivative Instruments and Hedging (Details) (USD $)	3 Months Ended		12 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Dec. 31, 2014	Feb. 27, 2015	Aug. 31, 2011
Derivative Instruments, Gain (Loss) [Line Items]
Long-term Debt	$ 3,387,623,000		$ 1,954,103,000
Unrealized loss on derivatives	(1,698,000)	(347,000)
Derivative assets, net	917,000		182,000
Interest Rate Cap One [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Strike rate, lower range	2.50%
Strike rate, higher range	3.00%
Payments of Derivative Issuance Costs	1,300,000
Notional amount of swap transactions	1,500,000,000
Interest Rate Cap Two [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Strike rate, higher range			2.25%
Payments of Derivative Issuance Costs			216,000
Notional amount of swap transactions			200,000,000
Credit Default Swaps [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Notional amount of swap transactions				45,000,000	100,000,000
Derivative Upfront Cost				1,600,000	8,200,000
Total exposure					1,800,000
Change in market value of credit default swap					250,000
Unrealized loss on derivatives	(680,000)	(226,000)
Investment Derivatives [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Derivative assets, net	1,202,000		654,000
Derivative liabilities	1,047,000		997,000
Marketable Securities and Other [Member] | Credit Default Swaps [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Net credit default of swap asset (liability)	503,000		(184,000)
Mortgage Loans Ten Through Twelve [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Long-term Debt	1,480,660,000
Mortgage Loan 6 [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Long-term Debt	$ 200,000,000		$ 200,000,000

XML

Significant Accounting Policies (Details) (USD $)	3 Months Ended		0 Months Ended
	Mar. 31, 2015 hotel	Mar. 31, 2014	Mar. 06, 2015 hotel	Mar. 10, 2011 Person	Dec. 31, 2014
Real Estate Properties [Line Items]
Number of hotel properties stated at historical cost	4
Impairment charges recorded for a hotel property included in the continuing operations	$ 0	$ 0
Valuation adjustment on impairment charge	(106,000)	(101,000)
Impairment charges of joint venture	0	0
Advisory services quarterly base fee	0.70%
Amount of derivative ineffectiveness	0	0
Restricted Cash [Member]
Real Estate Properties [Line Items]
Escrow reserve for capital improvements as percentage of gross revenues, Minimum	3.00%
Escrow reserve for capital improvements as percentage of gross revenues, Maximum	6.00%
Notes Receivable [Member]
Real Estate Properties [Line Items]
Interest income recorded	0	0
Impairment charges of notes receivable	0	0
Valuation adjustment on impairment charge	$ (106,000)	$ (101,000)
Ashford Prime OP [Member]
Real Estate Properties [Line Items]
Percentage of interest in the hotel properties	15.20%				14.90%
PIM Highland JV [Member]
Real Estate Properties [Line Items]
Percent of voting interest acquired			28.26%
Number of hotels in portfolio acquired			28
Percentage of interest in the hotel properties			100.00%	71.74%
Number of members of executive committee				4
Number of persons designated to executive committee by joint venture partner				2
Number of persons designated to executive committee by company	2			2
Unconsolidated Properties [Member] | Minimum [Member]
Real Estate Properties [Line Items]
Percentage of interest in the hotel properties	14.40%
Unconsolidated Properties [Member] | Maximum [Member]
Real Estate Properties [Line Items]
Percentage of interest in the hotel properties	30.10%

XML

Investment in Hotel Properties, net (Tables)

3 Months Ended

Mar. 31, 2015

Property, Plant and Equipment [Abstract]

Schedule of investments in hotel properties, net

Investments in hotel properties, net consisted of the following (in thousands):

	March 31, 2015			December 31, 2014
Land	$	661,499		$	358,514
Buildings and improvements	3,535,862			2,125,656
Furniture, fixtures, and equipment	346,744			211,777
Construction in progress	16,563			11,704
Condominium properties	12,153			12,065
Total cost	4,572,821			2,719,716
Accumulated depreciation	(618,838		)	(591,105		)
Investments in hotel properties, net	$	3,953,983		$	2,128,611

Schedule of preliminary fair value of the assets acquired and liabilities assumed

The following table summarizes the preliminary fair value of the assets acquired and liabilities assumed in the acquisition (in thousands):

Land	$	4,541
Buildings and improvements	24,703
Furniture, fixtures, and equipment	4,237
	33,481
Net other assets and liabilities	(382		)

The following table summarizes the preliminary fair value of the assets acquired and liabilities assumed in the acquisition (in thousands):

Land	$	6,210
Buildings and improvements	32,934
Furniture, fixtures, and equipment	4,350
	43,494
Net other assets and liabilities	34

The following table summarizes the preliminary fair value of the assets acquired and liabilities assumed in the acquisition (in thousands):

Land	$	292,934
Buildings and improvements	1,351,293
Furniture, fixtures, and equipment	118,878
	1,763,105
Indebtedness	(1,120,082		)
Net other assets and liabilities	105,814

Schedule of business combination pro forma information

The following table reflects the unaudited pro forma results of operations as if all acquisitions had occurred and the applicable indebtedness was incurred on January 1, 2014 and the removal of $495,000 of non-recurring transaction costs and gain on acquisition of the PIM Highland JV of $381.8 million. The table also reflects the removal of equity in loss in unconsolidated entity of $3.8 million and $2.8 million for the three month ended March 31, 2015 and 2014, respectively. These adjustments are directly attributable to the transactions for the three months ended March 31, 2015 (in thousands):

	Three Months Ended March 31,
	2015			2014
Total revenue	$	330,830		$	310,103
Net loss	(23,129		)	(11,466		)

XML

Summary of Fair Value of Financial Instruments (Schedule of Carrying Amounts and Estimated Fair Values of Financial Instruments) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014	Mar. 31, 2014
Financial assets and liabilities measured at fair value:
Marketable securities, Carrying value	$ 72,427	$ 63,217
Marketable securities, Estimated fair value	72,427	63,217
Derivative assets, Carrying value	917	182
Derivative assets, Estimated fair value	917	182
Liabilities associated with investments in securities and other, Carrying value	12,771	6,201
Liabilities associated with marketable securities, Fair value	12,771	6,201
Financial assets not measured at fair value:
Cash and cash equivalents, Carrying value	355,727	215,063
Cash and cash equivalents, Estimated fair value	355,727	215,063
Restricted cash, Carrying value	143,043	85,830
Restricted cash, Estimated fair value	143,043	85,830
Accounts receivable, Carrying value	52,512	22,399
Accounts receivable, Estimated fair value	52,512	22,399
Notes receivable, Carrying value	3,599	3,553
Due from affiliates, Carrying value	0	3,473
Due from affiliates, Estimated fair value	0	3,473
Due from Ashford Prime OP, net, Carrying value	335	896
Due from Ashford Prime OP, net, Estimated fair value	335	896
Due from related parties, Carrying value	1,922	0
Due from related party, Fair value	1,922	0
Due from third-party hotel managers, Carrying value	39,047	12,241
Due from third party hotel managers, Estimated fair value	39,047	12,241
Financial liabilities not measured at fair value:
Indebtedness	3,387,623	1,954,103
Accounts payable and accrued expenses, Carrying value	131,890	71,118
Accounts payable and accrued expenses, Estimated fair value	131,890	71,118
Dividends payable, Carrying value	23,346	21,889	20,890
Dividends payable, Estimated fair value	23,346	21,889
Due to Ashford Inc., net, Carrying value	9,120	8,202
Due to Ashford Inc. Fair Value Disclosure	9,120	8,202
Due to related party, net, Carrying value	0	1,867
Due to related party, net, Estimated fair value	0	1,867
Due to third-party hotel managers, Carrying value	1,529	1,640
Due to third-party hotel managers, Estimated fair value	1,529	1,640
Minimum [Member]
Financial assets not measured at fair value:
Notes receivable, Estimated fair value	3,117	3,049
Financial liabilities not measured at fair value:
Indebtedness, Estimated fair value	3,267,372	1,905,801
Maximum [Member]
Financial assets not measured at fair value:
Notes receivable, Estimated fair value	3,445	3,370
Financial liabilities not measured at fair value:
Indebtedness, Estimated fair value	$ 3,611,305	$ 2,106,413

XML

Investment in Unconsolidated Entities (Summary of Statement of Operations) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		2 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Mar. 05, 2015
Real Estate Properties [Line Items]
Total revenue	$ 250,235	$ 194,861
Total operating expenses	(218,130)	(168,468)
Operating income	32,105	26,393
Unrealized gain (loss) on marketable securities	(1,802)	1
Unrealized loss on derivatives	(1,698)	(347)
Income tax expense	(825)	(216)
Net income (loss)	366,807	(3,292)
Net income (loss) attributable to the Company	321,496	(2,388)
Our equity in earnings (loss) entity	(6,622)	(3,498)
Ashford Prime OP [Member]
Real Estate Properties [Line Items]
Total revenue	77,789	61,806
Total operating expenses	(69,530)	(57,031)
Operating income	8,259	4,775
Interest income	4	4
Other Income	139	0
Interest expense, amortization and write-offs of deferred loan costs, discounts and premiums and exit fees	(9,637)	(8,989)
Unrealized gain (loss) on marketable securities	1,323	0
Unrealized loss on derivatives	(32)	(15)
Income tax expense	(481)	(226)
Net income (loss)	(425)	(4,451)
Loss from consolidated entities attributable to noncontrolling interest	147	405
Net income (loss) attributable to the Company	(278)	(4,046)
Our equity in earnings (loss) entity	(45)	(744)
PIM Highland JV [Member]
Real Estate Properties [Line Items]
Total revenue		108,761	76,695
Total operating expenses		(95,388)	(69,949)
Operating income		13,373	6,746
Interest income and other		13	17
Interest expense, amortization and write-offs of deferred loan costs, discounts and premiums and exit fees		(15,908)	(10,212)
Other expenses		(44)	0
Income tax expense		(447)	(1,222)
Net income (loss)		(3,013)	(4,671)
Our equity in earnings (loss) entity		(2,754)	(3,836)
Ashford Inc. [Member]
Real Estate Properties [Line Items]
Total revenue	13,118	2,312
Total operating expenses	(21,502)	(11,110)
Operating income	(8,384)	(8,798)
Income tax expense	(1,454)	(15)
Net income (loss)	(9,838)	(8,813)
Loss from consolidated entities attributable to noncontrolling interest	763	0
Noncontrolling Interest in Net Income (Loss) Operating Partnerships, Redeemable	(21)	0
Net income (loss) attributable to the Company	(9,054)	(8,813)
Our equity in earnings (loss) entity	$ (2,741)	$ 0

XML

Investment in Hotel Properties, net (Pro Forma Information) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Property, Plant and Equipment [Abstract]
Total revenue	$ 330,830	$ 310,103
Net loss	$ (23,129)	$ (11,466)

XML

Redeemable Noncontrolling Interests in Operating Partnership (Narrative) (Details) (USD $)	3 Months Ended		1 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Mar. 31, 2015	Dec. 31, 2014	Nov. 12, 2014
Redeemable Noncontrolling Interest [Line Items]
Common unit percentage worth of common stock share	93.00%		93.00%	94.00%
Redemption value adjustment	$ 52,659,000
Cash distributions declared	21,888,000	20,734,000
Ashford Inc. [Member]
Redeemable Noncontrolling Interest [Line Items]
Special distribution, conversion ratio, shares of Common Stock					87
Special distribution, maximum percentage of shares available for conversion for Unitholders					99.00%
Special distribution, conversion ratio, units					55
Shares in investment held (in shares)	598,000		598,000
Partnership Interest [Member]
Redeemable Noncontrolling Interest [Line Items]
Common units Converted	150,000
Class B Common Units [Member]
Redeemable Noncontrolling Interest [Line Items]
Dividend rate common units, year one to three	6.82%
Dividend rate common units, after year three	7.20%
Long Term Incentive Plan [Member]
Redeemable Noncontrolling Interest [Line Items]
Common partnership unit per converted Long-Term Incentive Plan unit	1
LTIP units issued	8,700,000		8,700,000
Value of units which had not reached full economic parity with the common units			660,000
Compensation expense	100,000	3,900,000
Unamortized value of LTIP unit	5,800,000		5,800,000
Long Term Incentive Plan [Member] | Partnership Interest [Member]
Redeemable Noncontrolling Interest [Line Items]
Redeemable noncontrolling interests in operating partnership	165,600,000		165,600,000	177,100,000
Ownership by non-controlling owners	12.38%		12.38%	13.01%
Redemption value adjustment	115,700,000	169,300,000
Allocated net income (loss) to redeemable noncontrolling interests	45,300,000	(900,000)
Cash distributions declared	2,700,000	2,700,000
Long Term Incentive Plan [Member] | Minimum [Member]
Redeemable Noncontrolling Interest [Line Items]
Vesting period	3 years
Long Term Incentive Plan [Member] | Maximum [Member]
Redeemable Noncontrolling Interest [Line Items]
Vesting period	5 years
Long Term Incentive Plan [Member] | OP Units Converted [Member]
Redeemable Noncontrolling Interest [Line Items]
Fair value of common units converted	$ 1,500,000		$ 1,500,000

XML

Fair Value Measurements (Narrative) (Details) (USD $)	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Fair Value Disclosures [Abstract]
Fair value consideration threshold for transfer in/out of level 3	10.00%
Lower Uptrend in the LIBOR interest rate	0.18%
Higher Uptrend in the LIBOR interest rate	1.31%
Derivative expense related to credit default swaps	$ 57,000	$ 21,000
Change in fair values of interest rate derivatives		$ 0

XML

Significant Accounting Policies

3 Months Ended

Mar. 31, 2015

Accounting Policies [Abstract]

Significant Accounting Policies

Significant Accounting Policies

Basis of Presentation—The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These consolidated financial statements include the accounts of Ashford Hospitality Trust, Inc., its majority-owned subsidiaries, and its majority-owned entities in which it has a controlling interest. All significant intercompany accounts and transactions between consolidated entities have been eliminated in these consolidated financial statements. These consolidated financial statements and related notes should be read in conjunction with the consolidated financial statements and notes thereto included in our 2014 Annual Report to Stockholders on Form 10-K and Form 10-K/A filed with the Securities and Exchange Commission (“SEC”) on March 2, 2015, and March 31, 2015, respectively.

The following items affect reporting comparability related to our consolidated financial statements:

• Historical seasonality patterns at some of our properties cause fluctuations in our overall operating results. Consequently, operating results for the three months ended March 31, 2015, are not necessarily indicative of the results that may be expected for the year ending December 31, 2015.

• On March 1, 2014, we completed the sale of the Pier House Resort to Ashford Prime (“Ashford Prime”). The results of the Pier House Resort, which we acquired on May 14, 2013, and sold on March 1, 2014, are included in our results of operations for the period from January 1, 2014, through February 28, 2014.

• On February 6, 2015, we acquired the Lakeway Resort & Spa, and on February 25, 2015, we acquired the Memphis Marriott East hotel. The results of these hotels are included in our results of operations as of their respective acquisition dates.

• On March 6, 2015, we acquired the remaining approximate 28.26% interest in the 28 hotels of the PIM Highland JV. For the period January 1, 2014, through March 5, 2015, we have recorded equity in earnings for our ownership percentage. Beginning March 6, 2015, we consolidated the results of operations of these hotels.

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.

Restricted Cash—Restricted cash includes reserves for debt service, real estate taxes, and insurance, as well as excess cash flow deposits and reserves for furniture, fixtures, and equipment replacements of approximately 3% to 6% of property revenue for certain hotels, as required by certain management or mortgage debt agreement restrictions and provisions. For purposes of the consolidated statements of cash flows, changes in restricted cash caused by using such funds for debt service, real estate taxes, and insurance are shown as operating activities. Changes in restricted cash caused by using such funds for furniture, fixtures, and equipment replacements are included in cash flows from investing activities.

Investments in Hotel Properties, net—Hotel properties are generally stated at cost. However, four hotel properties contributed upon Ashford Trust’s formation in 2003 are stated at the predecessor’s historical cost, net of impairment charges, if any, plus a partial step-up related to the acquisition of noncontrolling interests from third parties associated with certain of these properties. For hotel properties owned through our majority-owned entities, the carrying basis attributable to the partners’ minority ownership is recorded at the predecessor’s historical cost, net of any impairment charges, while the carrying basis attributable to our majority ownership is recorded based on the allocated purchase price of our ownership interests in the entities. All improvements and additions which extend the useful life of hotel properties are capitalized.

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. No impairment charges were recorded for investments in hotel properties for the three months ended March 31, 2015 and 2014.

Hotel Dispositions—Effective January 1, 2015, 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 anticipate that dispositions of hotel properties will 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. This new guidance is to be implemented prospectively only. As such, hotel property dispositions that occurred prior to December 31, 2014, will continue to be reported as discontinued operations in the statements of operations for all applicable periods presented. See Note 4.

Assets Held for Sale and Discontinued Operations—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 or group of components that represents a strategic shift that has (or will have) a major effect on our operations and cash flows.

Intangible Assets and Liabilities—Intangible assets and liabilities represent the assets and liabilities recorded on certain hotel properties’ ground lease contracts that were below or above market rates at the date of acquisition. These assets and liabilities are amortized using the straight-line method over the remaining terms of the respective lease contracts.

Note Receivable—Mezzanine loan financing, classified as note receivable, represents a loan held for investment and intended to be held to maturity. Note receivable is recorded at cost, net of unamortized loan origination costs and fees, loan purchase discounts, and allowance for losses when a loan is deemed to be impaired. Premiums, discounts, and net origination fees are amortized or accreted as an adjustment to interest income using the effective interest method over the life of the loan. We discontinue recording interest and amortizing discounts/premiums when the contractual payment of interest and/or principal is not received when contractually due. Payments received on impaired nonaccrual loans are recorded as adjustments to impairment charges. No interest income was recorded for the three months ended March 31, 2015 and 2014.

Variable interest entities (“VIEs”), as defined by authoritative accounting guidance, must be consolidated by their controlling interest beneficiaries if the VIEs do not effectively disperse risks among the parties involved. Our remaining mezzanine note receivable at March 31, 2015, is secured by a hotel property and is subordinate to the controlling interest in the secured hotel property. Although the note receivable is considered to be a variable interest in the entity that owns the related hotel, we are not considered to be the primary beneficiary of the hotel property as a result of holding the loan. Therefore, we do not consolidate the hotel property for which we have provided financing. We will evaluate interests in entities acquired or created in the future to determine whether such entities should be consolidated. In evaluating VIEs, our analysis involves considerable management judgment and assumptions.

Impairment of Note Receivable—We review notes receivable for impairment each reporting period. A loan is impaired when, based on current information and events, collection of all amounts recorded as assets on the balance sheet is no longer considered probable. We apply normal loan review and underwriting procedures (as may be implemented or modified from time to time) in making that judgment.

When a loan is impaired, we measure impairment based on the present value of expected cash flows discounted at the loan’s effective interest rate against the value of the asset recorded on the balance sheet. We may also measure impairment based on a loan’s observable market price or the fair value of collateral if the loan is collateral-dependent. 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 during the three months ended March 31, 2015 and 2014. Valuation adjustments of $(106,000) and $(101,000) on previously impaired notes were credited to impairment charges during the three months ended March 31, 2015 and 2014, respectively.

Investments in Unconsolidated Entities—Investments in entities in which we have ownership interests ranging from 14.4% to 30.1% 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 in our unconsolidated entities for impairment in 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 impairment is recorded in equity earnings (loss) in unconsolidated entities. No such impairment was recorded in the three months ended March 31, 2015 and 2014.

Our investments in certain unconsolidated entities are considered to be variable interests in the underlying entities. Variable Interest Entities (“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, (ii) an implicit financial responsibility to ensure that a VIE operates as designed, and (iii) 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 should not be consolidated. In evaluating VIEs, our analysis involves considerable management judgment and assumptions.

Marketable Securities—Marketable securities, including U.S. treasury bills, publicly traded equity securities and stocks, and put and call options on certain publicly traded securities. All of these investments are recorded at fair value. Put and call options are considered derivatives. The fair value of these investments has been determined based on the closing price as of the balance sheet date and is reported as “marketable securities” or “liabilities associated with marketable securities and other” in the consolidated balance sheets. The cost of securities sold is determined by using the high cost method. Net investment income, including interest income (expense), dividends, realized gains or losses and costs of investment, is reported as a component of “other income.” Unrealized gains and losses on these investments are reported as “unrealized gain (loss) on marketable securities” in the consolidated statements of operations.

Due to/from Affiliates—Due to/from affiliates represents current receivables and payables resulting primarily from advances of shared costs incurred. Both due to/from affiliates are generally settled within a period not exceeding one year.

Due to/from Related Party—Due to/from related party represents current receivables and payables resulting from transactions related to hotel management, project management and market services with a related party. Due to/from related party is generally settled within a period not exceeding one year.

Due to/from Ashford Prime OP, net—Due to/from Ashford Prime OP represents receivables and payables resulting primarily from miscellaneous operating and capital improvement true-ups between the two entities. In 2014, we had receivables related to advisory fees. Both due to/from Ashford Prime OP is generally settled within a period not exceeding one year.

Due to Ashford Inc., net—Due to Ashford Inc., net, represents current payables resulting primarily from advisory services fee, including reimbursable expenses. In 2014, due to Ashford Inc., net, included payables resulting primarily from costs associated with the spin-off of Ashford Inc. Due to Ashford Inc., net, is generally settled within a period not exceeding one year.

Revenue Recognition—Hotel revenues, including room, food, beverage, and ancillary revenues such as long-distance telephone service, laundry, parking and space rentals, are recognized when services have been rendered. Taxes collected from customers and submitted to taxing authorities are not recorded in revenue. Interest income (including accretion of discounts on the mezzanine loan using the effective interest method) is recognized when earned. We discontinue recording interest and amortizing discounts/premiums when the contractual payment of interest and/or principal is not received when contractually due. We are reimbursed by PIM Highland JV for costs associated with managing its day-to-day operations and providing corporate administrative services such as accounting, insurance, marketing support, asset management and other services. Beginning with the three months ended March 31, 2014, we changed the presentation to report such reimbursements as “Other” revenue as opposed to credits within “Corporate, general and administrative” expense. This change had no impact on our financial condition or results of operations. As of March 6, 2015, we acquired the remaining approximate 28.26% of the PIM Highland JV which discontinued the aforementioned reimbursements.

Prior to the spin-off of Ashford Inc. in November 2014, we recognized advisory services revenue when services had been rendered. The quarterly base fee was equal to 0.7% per annum of the total market capitalization, as defined in the advisory agreement, of Ashford Prime, subject to certain minimums. Reimbursements for overhead and internal audit services was recognized when services had been rendered. We also recorded advisory services revenue for equity grants of Ashford Prime common stock and LTIP units awarded to our officers and employees in connection with providing advisory services equal to the fair value of the award in proportion to the requisite service period satisfied during the period, as well as an offsetting expense in an equal amount included in “corporate, general and administrative” expense.

Derivatives Instruments and Hedging—We use interest rate derivatives to hedge our risks and to capitalize on the historical correlation between changes in LIBOR (London Interbank Offered Rate) and RevPAR (Revenue per Available Room). Interest rate derivatives could include swaps, caps, floors and flooridors. We assess the effectiveness of each hedging relationship by comparing changes in fair value or cash flows of the derivative hedging instrument with the changes in fair value or cash flows of the designated hedged item or transaction. We also use credit default swaps to hedge financial and capital market risk. All of our derivatives are subject to master-netting settlement arrangements and the credit default swaps are subject to credit support annexes. For credit default swaps, cash collateral is posted by us as well as our counterparty. We offset the fair value of the derivative and the obligation/right to return/reclaim cash collateral.

All derivatives are recorded at fair value in accordance with the applicable authoritative accounting guidance. Interest rate derivatives and credit default swaps are reported as “Derivative assets, net” or “Liabilities associated with marketable securities and other” in the consolidated balance sheets. Accrued interest on non-hedge designated interest rate derivatives is included in “Accounts receivable, net” in the consolidated balance sheets. For interest rate derivatives designated as cash flow hedges:

a) the effective portion of changes in fair value is initially reported as a component of “Accumulated other comprehensive income (loss)” (“OCI”) in the equity section of the consolidated balance sheets and reclassified to interest expense in the consolidated statements of operations in the period during which the hedged transaction affects earnings, and

b) the ineffective portion of changes in fair value is recognized directly in earnings as “Unrealized gain (loss) on derivatives” in the consolidated statements of operations. For the three months ended March 31, 2015 and 2014, there was no ineffectiveness.

For non-hedge designated interest rate derivatives and credit default swaps, changes in fair value are recognized in earnings as “unrealized loss on derivatives” in the consolidated statements of operations.

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 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.

The “Income Taxes” Topic of the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification 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 2011 through 2014 remain subject to potential examination by certain federal and state taxing authorities.

Reclassification—Certain amounts in the consolidated financial statements for the three months ended March 31, 2014, have been reclassified for discontinued operations.

Recently Adopted Accounting Standards—In April 2014, the FASB issued accounting guidance that revises the definition of discontinued operations by limiting discontinued operations reporting to disposals of components of an entity that represent strategic shifts that have (or will have) a major effect on an entity’s operations and financial results, removing the lack of continuing involvement criteria and requiring discontinued operations reporting for the disposal of an equity method investment that meets the definition of discontinued operations. The update also requires expanded disclosures for discontinued operations, including disclosure of pretax profit or loss of an individually significant component of an entity that does not qualify for discontinued operations reporting. The new accounting guidance is effective prospectively for fiscal years, and interim periods within those years, beginning after December 15, 2014. We adopted this accounting guidance on January 1, 2015. The adoption of this accounting guidance impacted the presentation of our results of operations as it required the operations of our disposed hotel property to be included in continuing operations.

Recently Issued Accounting Standards—In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). ASU 2014-09 is a comprehensive new revenue recognition model, which requires a company to recognize revenue to depict the transfer of promised goods or services to a customer in an amount that reflects the consideration the company expects to receive in exchange for those goods or services. The update will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. ASU 2014-09 is effective in fiscal periods beginning after December 15, 2016. Early adoption is not permitted. The standard permits the use of either the retrospective or cumulative effect transition method. We are evaluating the effect that ASU 2014-09 will have on our consolidated financial statements and related disclosures. We have not yet selected a transition method.

In August 2014, the FASB issued ASU 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (“ASU 2014-15”), to provide guidance on management's responsibility to perform interim and annual assessments of an entity’s ability to continue as a going concern and to provide related disclosure requirements. ASU 2014-15 applies to all entities and is effective for annual periods ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. We do not expect the adoption of this standard will have an impact on our financial position, results of operations or cash flows.

In February 2015, the FASB issued ASU 2015-02, Amendments to the Consolidation Analysis. The ASU amends the consolidation guidance for VIEs and general partners' investments in limited partnerships and modifies the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities. The ASU is effective for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. We are currently evaluating the effect of the ASU on our consolidated financial statements and related disclosures.

In April 2015, the FASB issued Accounting Standards Update (“ASU”) No. 2015-03, Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. The new standard requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The standard is effective for annual reporting periods beginning after December 15, 2015, and interim periods within those fiscal years, with early adoption permitted. Upon adoption of the standard we will reclassify deferred financing costs, net from total assets to be shown net of debt in the liabilities section of our consolidated balance sheet. Adoption of this standard will only affect the presentation of our consolidated balance sheet.

XML

Indebtedness (Details) (USD $)	3 Months Ended	12 Months Ended
	Mar. 31, 2015	Dec. 31, 2014	Jan. 02, 2015	Mar. 06, 2015	Mar. 25, 2015	Feb. 25, 2015
Debt Instrument [Line Items]
Indebtedness	$ 3,387,623,000	1,954,103,000
Long-term debt, gross of premium	3,383,431,000	1,954,103,000
Unamortized premium on Long-term debt	4,192,000	0
London Interbank Offered Rate (LIBOR) Rate	0.176%	0.171%
Amortization of debt premium	(127,000)
Mortgage loan 1 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)		5
Indebtedness	0	211,000,000
Face amount of debt			211,000,000
Mortgage loan 1 [Member] | Minimum [Member]
Debt Instrument [Line Items]
Interest Rate		6.40%
Mortgage loan 1 [Member] | Maximum [Member]
Debt Instrument [Line Items]
Debt instrument description of variable rate basis		LIBOR
Basis spread on variable rate		6.15%
Mortgage loan 2 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)		10
Interest Rate		5.22%
Indebtedness	0	145,278,000
Face amount of debt			145,300,000
Mortgage Loan 3 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	8	8
Interest Rate	5.70%	5.70%
Indebtedness	92,203,000	92,772,000
Number of extension options	3
Term of mortgage loan extension option	1 year
Mortgage loan 4 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	5	5
Interest Rate	5.53%	5.53%
Indebtedness	104,692,000	105,164,000
Mortgage loan 5 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	5	5
Interest Rate	5.53%	5.53%
Indebtedness	75,207,000	75,546,000
Mortgage Loan 6 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	5	5
Debt instrument description of variable rate basis	LIBOR	LIBOR
Basis spread on variable rate	4.75%	4.75%
Indebtedness	200,000,000	200,000,000
Number of extension options	3
Term of mortgage loan extension option	1 year
Mortgage loan 7 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	7	7
Debt instrument description of variable rate basis	LIBOR	LIBOR
Basis spread on variable rate	4.35%	4.35%
Indebtedness	301,000,000	301,000,000
Number of extension options	3
Term of mortgage loan extension option	1 year
Mortgage Loan 8 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	5	5
Debt instrument description of variable rate basis	LIBOR	LIBOR
Basis spread on variable rate	4.38%	4.38%
Indebtedness	62,900,000	62,900,000
Number of extension options	3
Term of mortgage loan extension option	1 year
Mortgage loan 9 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	1	1
Debt instrument description of variable rate basis	LIBOR	LIBOR
Basis spread on variable rate	4.20%	4.20%
Indebtedness	37,500,000	37,500,000
Number of extension options	3
Term of mortgage loan extension option	1 year
Mortgage loan 10 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	8
Debt instrument description of variable rate basis	LIBOR
Basis spread on variable rate	4.95%
Indebtedness	376,800,000	0
Number of extension options	3
Term of mortgage loan extension option	1 year
Face amount of debt			376,800,000
Mortgage Loan 11 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	24
Debt instrument description of variable rate basis	LIBOR
Basis spread on variable rate	4.39%
Indebtedness	1,070,560,000	0
Number of extension options	4
Term of mortgage loan extension option	1 year
Face amount of debt				1,070,000,000
Mortgage loan 12 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	1
Debt instrument description of variable rate basis	LIBOR
Basis spread on variable rate	4.95%
Indebtedness	33,300,000	0
Number of extension options	3
Term of mortgage loan extension option	1 year
Mortgage loan 13 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	5	5
Interest Rate	5.95%	5.95%
Indebtedness	111,463,000	111,869,000
Number of extension options	3
Term of mortgage loan extension option	1 year
Mortgage loan 14 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	5	5
Interest Rate	5.95%	5.95%
Indebtedness	100,188,000	100,552,000
Mortgage Loan 15 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	5	5
Interest Rate	5.95%	5.95%
Indebtedness	152,447,000	153,002,000
Mortgage loan 16 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	7	7
Interest Rate	5.95%	5.95%
Indebtedness	121,940,000	122,384,000
Mortgage loan 17 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	1
Interest Rate	4.38%
Indebtedness	99,343,000	0
Face amount of debt				99,300,000
Mortgage loan 18 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	2
Interest Rate	4.44%
Indebtedness	108,646,000	0
Face amount of debt				108,600,000
Mortgage Loan 19 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	1	1
Debt instrument description of variable rate basis	LIBOR	LIBOR
Basis spread on variable rate	3.75%	3.75%
Indebtedness	5,524,000	5,525,000
Mortgage Loan 20 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	1	1
Interest Rate	6.26%	6.26%
Indebtedness	99,509,000	99,780,000
Mortgage Loan 21 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	1	1
Interest Rate	5.49%	5.49%
Indebtedness	10,636,000	10,673,000
Mortgage Loan 22 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	1	1
Interest Rate	5.49%	5.49%
Indebtedness	7,288,000	7,313,000
Mortgage Loan 23 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	1	1
Interest Rate	4.99%	4.99%
Indebtedness	6,819,000	6,845,000
Mortgage Loan 24 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	3	3
Interest Rate	5.20%	5.20%
Indebtedness	67,520,000	67,520,000
Mortgage Loan 25 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	2	2
Interest Rate	4.85%	4.85%
Indebtedness	12,500,000	12,500,000
Mortgage Loan 26 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	3	3
Interest Rate	4.90%	4.90%
Indebtedness	24,980,000	24,980,000
Mortgage Loan 27 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	3
Interest Rate	4.45%
Indebtedness	54,813,000	0
Face amount of debt			54,800,000
Mortgage Loan 28 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	2
Interest Rate	4.45%
Indebtedness	24,461,000	0
Face amount of debt			24,500,000
Mortgage Loan 29 [Member]
Debt Instrument [Line Items]
Collateral (in hotels)	2
Interest Rate	4.45%
Indebtedness	21,192,000	0
Face amount of debt			21,200,000
Mortgage Loans Twenty-Seven Through Twenty-Nine [Member]
Debt Instrument [Line Items]
Face amount of debt			100,500,000
Refinanced Mortgage Loan 1 [Member]
Debt Instrument [Line Items]
Face amount of debt			477,300,000
Repurchased face amount			356,300,000
Memphis Marriott [Member]
Debt Instrument [Line Items]
Face amount of debt					33,300,000
Percent of voting interest acquired						100.00%
Memphis Marriott [Member] | Mortgage loan 12 [Member]
Debt Instrument [Line Items]
Face amount of debt					33,300,000
PIM Highland JV [Member]
Debt Instrument [Line Items]
Face amount of debt				$ 907,600,000
Percent of voting interest acquired				28.26%
PIM Highland JV [Member]
Debt Instrument [Line Items]
Percent of voting interest acquired				28.26%

XML

Income (Loss) Per Share (Tables)

3 Months Ended

Mar. 31, 2015

Earnings Per Share [Abstract]

Summary of Amounts Used in Calculating Basic and Diluted Earnings (Loss) Per Share

The following table reconciles the amounts used in calculating basic and diluted income (loss) per share (in thousands, except per share amounts):

	Three Months Ended March 31,
	2015			2014
Net income (loss) allocated to common stockholders:
Net income (loss) attributable to the Company	$	321,496		$	(2,391	)
Less: Dividends on preferred stocks	(8,490		)	(8,490		)
Less: Dividends on common stock	(11,964		)	(9,629		)
Less: Dividends on unvested restricted shares	(165		)	(84		)
Less: Undistributed income from continuing operations allocated to unvested shares	(2,035		)	—
Undistributed income (loss)	298,842			(20,594		)
Add back: Dividends on common stock	11,964			9,629
Distributed and undistributed income (loss) from continuing operations - basic	$	310,806		$	(10,965	)
Add back: Income from continuing operations allocated to operating partnership units	45,336			—
Distributed and undistributed net income (loss) - diluted	$	356,142		$	(10,965	)
Income from discontinued operations allocated to common stockholders:
Income from discontinued operations attributable to the Company	$	—		$	3
Weighted average shares outstanding:
Weighted average common shares outstanding - basic	95,539			81,690
Effect of assumed conversion of operating partnership units	18,373			—
Weighted average shares outstanding - diluted	113,912			81,690
Basic income (loss) per share:
Income (loss) from continuing operations allocated to common stockholders per share	$	3.25		$	(0.13	)
Income from discontinued operations allocated to common stockholders per share	—			—
Net income (loss) allocated to common stockholders per share	$	3.25		$	(0.13	)
Diluted income (loss) per share:
Income (loss) from continuing operations allocated to common stockholders per share	$	3.13		$	(0.13	)
Income from discontinued operations allocated to common stockholders per share	—			—
Net income (loss) allocated to common stockholders per share	$	3.13		$	(0.13	)

Summary of Computation of Diluted Income Per Share

Due to the anti-dilutive effect, the computation of diluted income (loss) per share does not reflect adjustments for the following items (in thousands):

	Three Months Ended March 31,
	2015		2014
Net income (loss) allocated to common stockholders is not adjusted for:
Income allocated to unvested restricted shares	$	2,200	$	84
Net income (loss) attributable to noncontrolling interest in operating partnership units	—		(877		)
Total	$	2,200	$	(793	)
Weighted average diluted shares are not adjusted for:
Effect of unvested restricted shares	432		144
Effect of assumed conversion of operating partnership units	—		19,316
Total	432		19,460

XML

Indebtedness (Tables)

3 Months Ended

Mar. 31, 2015

Debt Disclosure [Abstract]

Summary of Indebtedness

Indebtedness consisted of the following (in thousands):

Indebtedness	Collateral	Maturity	Interest Rate	March 31, 2015		December 31, 2014
Mortgage loan (4)	5 hotels	November 2015	Greater of 6.40% or LIBOR (1) + 6.15%	$	—	$	211,000
Mortgage loan	10 hotels	July 2015	5.22%	—		145,278
Mortgage loan	8 hotels	December 2015	5.70%	92,203		92,772
Mortgage loan	5 hotels	February 2016	5.53%	104,692		105,164
Mortgage loan	5 hotels	February 2016	5.53%	75,207		75,546
Mortgage loan (2)(6)	5 hotels	February 2016	LIBOR (1) + 4.75%	200,000		200,000
Mortgage loan (2)	7 hotels	August 2016	LIBOR (1) + 4.35%	301,000		301,000
Mortgage loan (2)	5 hotels	August 2016	LIBOR (1) + 4.38%	62,900		62,900
Mortgage loan (2)	1 hotel	August 2016	LIBOR (1) + 4.20%	37,500		37,500
Mortgage loan (2)	8 hotels	January 2017	LIBOR (1) + 4.95%	376,800		—
Mortgage loan (5)	24 hotels	April 2017	LIBOR (1) + 4.39%	1,070,560		—
Mortgage loan (2)	1 hotel	April 2017	LIBOR (1) + 4.95%	33,300		—
Mortgage loan	5 hotels	April 2017	5.95%	111,463		111,869
Mortgage loan	5 hotels	April 2017	5.95%	100,188		100,552
Mortgage loan	5 hotels	April 2017	5.95%	152,447		153,002
Mortgage loan	7 hotels	April 2017	5.95%	121,940		122,384
Mortgage loan	1 hotel	January 2018	4.38%	99,343		—
Mortgage loan	2 hotels	January 2018	4.44%	108,646		—
Mortgage loan (3)	1 hotel	July 2019	LIBOR (1) + 3.75%	5,524		5,525
Mortgage loan	1 hotel	November 2020	6.26%	99,509		99,780
Mortgage loan	1 hotel	January 2024	5.49%	10,636		10,673
Mortgage loan	1 hotel	January 2024	5.49%	7,288		7,313
Mortgage loan	1 hotel	May 2024	4.99%	6,819		6,845
Mortgage loan	3 hotels	August 2024	5.20%	67,520		67,520
Mortgage loan	2 hotels	August 2024	4.85%	12,500		12,500
Mortgage loan	3 hotels	August 2024	4.90%	24,980		24,980
Mortgage loan	3 hotels	February 2025	4.45%	54,813		—
Mortgage loan	2 hotels	February 2025	4.45%	24,461		—
Mortgage loan	2 hotels	February 2025	4.45%	21,192		—
				3,383,431		1,954,103
Premiums				4,192		—
Total				$	3,387,623	$	1,954,103

____________________________________

⁽¹⁾ LIBOR rates were 0.176% and 0.171% at March 31, 2015 and December 31, 2014, respectively.

⁽²⁾ This mortgage loan has threeone-year extension options subject to satisfaction of certain conditions.

⁽³⁾ This mortgage loan provides for an interest rate of LIBOR + 3.75% with a 0.25% LIBOR floor for the first 18 months and is fixed at 4.0% thereafter.

⁽⁴⁾ This mortgage loan had threeone-year extension options subject to satisfaction of certain conditions. The first one-year extension period began in November 2014.

⁽⁵⁾ This mortgage loan has four one-year extension options subject to satisfaction of certain conditions.

⁽⁶⁾ This mortgage loan has a LIBOR floor of 0.20%.

XML

Subsequent Events (Details) (USD $)	0 Months Ended
	Feb. 06, 2015	Apr. 17, 2015	Apr. 29, 2015	Mar. 31, 2015 room	Dec. 31, 2014
Subsequent Event [Line Items]
Investments in hotel properties, net				$ 3,953,983,000	$ 2,128,611,000
Number of rooms owned				25,579
Lakeway Resort [Member]
Subsequent Event [Line Items]
Consideration transferred	33,500,000
Subsequent Event [Member] | Lakeway Resort [Member]
Subsequent Event [Line Items]
Face amount of debt		25,100,000
Debt instrument description of variable rate basis		LIBOR
Basis spread on variable rate		5.10%
Number of extension options		3
Term of mortgage loan extension option		1 year
Subsequent Event [Member] | Gainesville Hampton [Member]
Subsequent Event [Line Items]
Consideration transferred			$ 25,300,000
Number of rooms owned			124

XML

Income (Loss) Per Share (Summary of Amounts Used in Calculating Basic and Diluted Earnings (Loss) Per Share) (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Net income (loss) allocated to common stockholders:
Net income (loss) attributable to the Company	$ 321,496	$ (2,391)
Net income (loss) attributable to the Company	321,496	(2,388)
Less: Dividends on preferred stocks	(8,490)	(8,490)
Income allocated to unvested restricted shares	(2,035)	0
Undistributed income (loss)	298,842	(20,594)
Distributed and undistributed income (loss) from continuing operations - basic	310,806	(10,965)
Add back: Income from continuing operations allocated to operating partnership units	45,336	0
Distributed and undistributed net income (loss) - diluted	(356,142)	10,965
Income from discontinued operations allocated to common stockholders:
Income from discontinued operations	0	3
Weighted average shares outstanding:
Weighted average common shares outstanding - basic	95,539	81,690
Effect of assumed conversion of operating partnership units	18,373	0
Weighted average common shares outstanding – diluted	113,912	81,690
Basic income (loss) per share:
Income (loss) from continuing operations attributable to common stockholders	$ 3.25	$ (0.13)
Income from discontinued operations allocated to common stockholders per share	$ 0.00	$ 0.00
Net income (loss) allocated to common stockholders per share	$ 3.25	$ (0.13)
Diluted loss per share:
Income (loss) from continuing operations attributable to common stockholders	$ 3.13	$ (0.13)
Income from discontinued operations attributable to common stockholders	$ 0.00	$ 0.00
Net income (loss) allocated to common stockholders per share	$ 3.13	$ (0.13)
Retained Earnings [Member]
Net income (loss) allocated to common stockholders:
Net income (loss) attributable to the Company	321,496
Common Stock
Net income (loss) allocated to common stockholders:
Less: Dividends	(11,964)	(9,629)
Effect of unvested restricted shares
Net income (loss) allocated to common stockholders:
Less: Dividends	$ (165)	$ (84)

XML

Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2015

Fair Value Disclosures [Abstract]

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 Market Prices (Level 1)			Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Counterparty and Cash Collateral Netting(4)			Total
March 31, 2015:
Assets
Derivative assets:
Interest rate derivatives - non-hedge	$	—		$	414	$	—	$	—		$	414		(1)
Credit default swaps	—			1,331		—		(828		)	503			(1)
Equity put options	935			—		—		—			935			(2)
Equity call options	267			—		—		—			267			(2)
Non-derivative assets:
Equity	53,155			—		—		—			53,155			(2)
U.S. treasury securities	18,070			—		—		—			18,070			(2)
Total	72,427			1,745		—		(828		)	73,344
Liabilities
Derivative liabilities:
Short equity put options	(353		)	—		—		—			(353		)	(3)
Short equity call options	(694		)	—		—		—			(694		)	(3)
Non-derivative liabilities:
Equity	(1,427		)	—		—		—			(1,427		)	(3)
Margin account balance	(10,297		)	—		—		—			(10,297		)	(3)
Total	(12,771		)	—		—		—			(12,771		)
Net	$	59,656		$	1,745	$	—	$	(828	)	$	60,573
December 31, 2014:
Assets
Derivative assets:
Interest rate derivatives - non-hedge	$	—		$	182	$	—	$	—		$	182		(1)
Equity put options	653			—		—		—			653			(2)
Equity call options	1			—		—		—			1			(2)
Non-derivative assets:
Equity securities	57,941			—		—		—			57,941			(2)
U.S. treasury securities	4,622			—		—		—			4,622			(2)
Total	63,217			182		—		—			63,399
Liabilities
Derivative liabilities:
Credit default swaps	—			379		—		(563		)	(184		)	(3)
Short equity put options	(216		)	—		—		—			(216		)	(3)
Short equity call options	(781		)	—		—		—			(781		)	(3)
Non-derivative liabilities:
Short equity securities	(17		)	—		—		—			(17		)	(3)
Margin account balance	(5,003		)	—		—		—			(5,003		)	(3)
Total	(6,017		)	379		—		(563		)	(6,201		)
Net	$	57,200		$	561	$	—	$	(563	)	$	57,198

____________________________________

⁽¹⁾ Reported net as “derivative assets, net” in the consolidated balance sheets.

⁽²⁾ Reported as “marketable securities” in the consolidated balance sheets.

⁽³⁾ Reported as “liabilities associated with marketable securities and other” in the consolidated balance sheets.

⁽⁴⁾ Represents cash collateral posted by our counterparty.

Effect of Fair Value Measured Assets and Liabilities on Consolidated Statements of Operations

The following tables summarize the effect of fair-value-measured assets and liabilities on the consolidated statements of operations for the three months ended March 31, 2015 and 2014 (in thousands):

	Gain (Loss) Recognized in Income								Reclassified from Accumulated OCI  into Interest Expense
	Three Months Ended March 31,								Three Months Ended March 31,
	2015				2014				2015		2014
Assets
Derivative assets:
Interest rate derivatives	$	(1,018	)		$	(121	)		$	—	$	71
Equity put options	(1,290		)		(462		)		—		—
Equity call options	80				(50		)		—		—
Credit default swaps	(737		)		(247		)		—		—
Non-derivative assets:
Equity - American Depositary Receipt	(65		)		—				—		—
Equity	2,063				948				—		—
U.S. Treasury	406				294				—		—
Total	(561		)		362				—		71
Liabilities
Derivative liabilities:
Short equity put options	595				4				—		—
Short equity call options	579				391				—		—
Non-derivative liabilities:
Short equity securities	(36		)		—				—		—
Total	1,138				395				—		—
Net	$	577			$	757			$	—	$	71
Total combined
Interest rate derivatives	$	(1,018	)		$	(121	)		$	—	$	71
Credit default swaps	(680		)		(226		)		—		—
Total derivatives	(1,698		)	(1)	(347		)	(1)	—		71
Unrealized gain (loss) on marketable securities	(1,802		)	(3)	1			(3)	—		—
Realized gain on marketable securities	4,077			(2) (4)	1,103			(2) (4)	—		—
Net	$	577			$	757			$	—	$	71

____________________________________

⁽¹⁾ Reported as “unrealized loss on derivatives” in the consolidated statements of operations.

⁽²⁾ Included in “other income” in the consolidated statements of operations.

⁽³⁾ Reported as “unrealized gain (loss) on marketable securities” in the consolidated statements of operations.

⁽⁴⁾ Includes costs of $57 and $21 for the three months ended March 31, 2015 and 2014, respectively, associated with credit default swaps.

XML

Summary of Fair Value of Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2015

Investments, All Other Investments [Abstract]

Schedule of Carrying Amounts and Estimated Fair Values of Financial Instruments

Carrying amounts and estimated fair values of financial instruments, for periods indicated, were as follows (in thousands):

	March 31, 2015				December 31, 2014
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Financial assets and liabilities measured at fair value:
Marketable securities	$	72,427	$	72,427	$	63,217	$	63,217
Derivative assets, net	917		917		182		182
Liabilities associated with marketable securities and other	12,771		12,771		6,201		6,201
Financial assets not measured at fair value:
Cash and cash equivalents	$	355,727	$	355,727	$	215,063	$	215,063
Restricted cash	143,043		143,043		85,830		85,830
Accounts receivable, net	52,512		52,512		22,399		22,399
Note receivable, net	3,599		3,117 to 3,445		3,553		3,049 to 3,370
Due from affiliates	—		—		3,473		3,473
Due from Ashford Prime OP, net	335		335		896		896
Due from related party, net	1,922		1,922		—		—
Due from third-party hotel managers	39,047		39,047		12,241		12,241
Financial liabilities not measured at fair value:
Indebtedness	$	3,387,623	$3,267,372 to $3,611,305		$	1,954,103	$1,905,801 to $2,106,413
Accounts payable and accrued expenses	131,890		131,890		71,118		71,118
Dividends payable	23,346		23,346		21,889		21,889
Due to Ashford Inc., net	9,120		9,120		8,202		8,202
Due to related party, net	—		—		1,867		1,867
Due to third-party hotel managers	1,529		1,529		1,640		1,640

XML

Organization and Description of Business

3 Months Ended

Mar. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Description of Business

Organization and Description of Business

Ashford Hospitality Trust, Inc., together with its subsidiaries (“Ashford Trust”), is a real estate investment trust (“REIT”) focused on investing in the hospitality industry across all segments and in all methods including direct real estate, securities, equity, and debt. Other than Ashford Hospitality Trust, Inc.’s investment in Ashford Inc. common stock, 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. In this report, terms such as the “Company,” “we,” “us,” or “our” refer to Ashford Hospitality Trust, Inc. and all entities included in its consolidated financial statements.

On December 14, 2014, we executed a Letter Agreement (the “Agreement”) with PRISA III Investments ("PRISA III"). The Agreement was approved by the investment committee of Prudential Real Estate Investors ("PREI"), the investment manager of PRISA III, and fully executed and delivered to us on December 15, 2014. Pursuant to the Agreement, we agreed to purchase and PRISA III agreed to sell (the “Transaction”) all of PRISA III’s right, title and interest in and to its approximately 28.26% interest in the PIM Highland Holding LLC (“PIM Highland JV”). As of March 6, 2015, we own 100% of the PIM Highland JV. See Notes 3, 6 and 7.

We are advised by Ashford Hospitality Advisors LLC (“Ashford LLC”), a subsidiary of Ashford Inc., through an advisory agreement. All of the hotels 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.

As of March 31, 2015, we owned interests in the following assets:

• 116 consolidated hotel properties, including 114 directly owned and two owned through a majority-owned investment in a consolidated entity, which represent 25,579 total rooms (or 25,552 net rooms excluding those attributable to our partners);

• 10 hotel properties owned through a 15.2% interest in Ashford Hospitality Prime Limited Partnership (“Ashford Prime OP”) with a carrying value of $54.6 million;

• 86 hotel condominium units at WorldQuest Resort in Orlando, Florida;

• a 30.1% ownership in Ashford Inc. common stock with a carrying value of $4.4 million; and

• a mezzanine loan with a carrying value of $3.6 million.

For federal income tax purposes, we have elected to be treated as a REIT, which imposes limitations related to operating hotels. As of March 31, 2015, our 116 hotel properties were leased or owned by our wholly owned subsidiaries that are treated as taxable REIT subsidiaries for 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.

As of March 31, 2015, Remington Lodging & Hospitality, LLC, together with its affiliates (“Remington Lodging”), which is beneficially wholly owned by Mr. Monty J. Bennett, our Chairman and Chief Executive Officer, and Mr. Archie Bennett, Jr., our Chairman Emeritus, managed 76 of our 116 hotel properties, one of the 10 Ashford Prime OP hotel properties and WorldQuest Resort. Third-party management companies managed the remaining hotel properties.

XML

Organization and Description of Business (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015 room	Dec. 31, 2014	Mar. 06, 2015	Mar. 10, 2011 hotel	Nov. 12, 2014
Real Estate Properties [Line Items]
Investment in unconsolidated entities	$ 58,971	$ 206,790
Number of rooms owned	25,579
Number of rooms owned, net of partnership interest	25,552
Notes receivable	3,599	3,553
Subsidiaries [Member]
Real Estate Properties [Line Items]
Number of hotel properties owned	116
Number of hotel properties managed by affiliates	76
PIM Highland JV [Member]
Real Estate Properties [Line Items]
Percent of voting interest acquired			28.26%
Number of hotel properties held by majority owned joint venture				28
Percentage of common equity interest			100.00%	71.74%
Investment in unconsolidated entities		144,784	522,800
Percentage of preferred equity interest				50.00%
Ashford Prime OP [Member]
Real Estate Properties [Line Items]
Number of hotel properties held by majority owned joint venture	10
Percentage of common equity interest	15.20%	14.90%
Investment in unconsolidated entities	54,613	54,907
Number of hotel properties managed by affiliates	1
World Quest Resort [Member]
Real Estate Properties [Line Items]
Number of rooms owned	86
Ashford Inc. [Member]
Real Estate Properties [Line Items]
Percentage of common equity interest	30.10%				30.10%
Investment in unconsolidated entities	$ 4,358	$ 7,099
Wholly Owned Properties [Member]
Real Estate Properties [Line Items]
Number of hotel properties owned	114
Majority Owned Properties [Member]
Real Estate Properties [Line Items]
Number of hotel properties owned	2

XML

Investment in Unconsolidated Entities (Details) (USD $) Share data in Thousands, unless otherwise specified	3 Months Ended		0 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Mar. 06, 2015 hotel	Mar. 10, 2011 Person hotel	Nov. 12, 2014	Dec. 31, 2014
Real Estate Properties [Line Items]
Investment in unconsolidated entities	$ 58,971,000					$ 206,790,000
Gain on acquisition of PIM Highland JV	381,835,000	0
Property in Nevis [Member]
Real Estate Properties [Line Items]
Subordinated beneficial interest in trust percentage						14.40%
Carrying value of subordinated beneficial interest						0
Spin-off of an 8-Hotel Portfolio [Member]
Real Estate Properties [Line Items]
Number of hotels in portfolio acquired	10
Total number of rooms owned through majority investments in joint ventures	3,707
Number of rooms owned through majority investments in joint ventures, net	3,472
Four Seasons Hotel Nevis [Member]
Real Estate Properties [Line Items]
Subordinated beneficial interest in trust percentage	14.40%
Carrying value of subordinated beneficial interest	0
PIM Highland JV [Member]
Real Estate Properties [Line Items]
Number of hotel properties held by majority owned joint venture				28
Percentage of common equity interest			100.00%	71.74%
Preferred equity interest				25,000,000
Percentage of preferred equity interest				50.00%
Unpaid annual return with priority over common equity distributions				15.00%
Number of members of executive committee				4
Number of persons designated to executive committee by company	2			2
Number of persons designated to executive committee by joint venture partner				2
Percent of voting interest acquired			28.26%
Investment in unconsolidated entities			522,800,000			144,784,000
Number of hotels in portfolio acquired			28
Ashford Prime OP [Member]
Real Estate Properties [Line Items]
Number of hotel properties held by majority owned joint venture	10
Percentage of common equity interest	15.20%					14.90%
Investment in unconsolidated entities	54,613,000					54,907,000
Ashford Inc. [Member]
Real Estate Properties [Line Items]
Special distribution, conversion ratio, shares of Common Stock					87
Percentage of common equity interest	30.10%				30.10%
Term of advisory agreement					20 years
Investment in unconsolidated entities	$ 4,358,000					$ 7,099,000
Special distribution, maximum percentage of shares available for conversion for Unitholders					99.00%
Special distribution, conversion ratio, units					55
Shares in investment held (in shares)	598

XML

Equity and Equity-Based Compensation (Details) (USD $)	3 Months Ended		0 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Feb. 10, 2015	Jan. 29, 2015	Dec. 31, 2014	Jan. 30, 2015
Class of Stock [Line Items]
Dividends declared per common share (in dollars per share)	$ 0.12	$ 0.12
Dividends annualized target (in dollars per share)	$ 0.48
Noncontrolling interests in consolidated entities	$ 775,000				$ 800,000
Income (loss) from consolidated joint ventures attributable to noncontrolling interests	(25,000)	(27,000)
Ownership by parent	15.00%				15.00%
Majority Owned Properties [Member]
Class of Stock [Line Items]
Number of hotel properties with JV interests	2				2
Restricted Stock [Member]
Class of Stock [Line Items]
Equity-based compensation	100,000	600,000
Restricted stock unamortized cost	9,600,000
Maximum [Member] | Restricted Stock [Member]
Class of Stock [Line Items]
Amortized period	3 years
Common Stock
Class of Stock [Line Items]
Issuances of stock (in shares)			1,029,000.000	9,500,000
Share price (in dollars per share)			$ 10.65			$ 10.65
Proceeds from issuance of stock, before underwriting discount and other expenses				$ 101,200,000
Additional shares authorized for purchase (in shares)						1,425,000
Series A Preferred Stock [Member]
Class of Stock [Line Items]
Percentage of preferred stock shares	8.55%	8.55%
Dividends declared per preferred share (in dollars per share)	$ 0.5344	$ 0.5344
Series D Preferred Stock [Member]
Class of Stock [Line Items]
Percentage of preferred stock shares	8.45%	8.45%
Dividends declared per preferred share (in dollars per share)	$ 0.5281	$ 0.5281
Series E Preferred Stock [Member]
Class of Stock [Line Items]
Percentage of preferred stock shares	9.00%	9.00%
Dividends declared per preferred share (in dollars per share)	$ 0.5625	$ 0.5625

XML

Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Assets
Cash and cash equivalents	$ 355,727	$ 215,063
Marketable securities	72,427	63,217
Total cash, cash equivalents and marketable securities	428,154	278,280
Investments in hotel properties, net	3,953,983	2,128,611
Restricted cash	143,043	85,830
Accounts receivable, net of allowance of $417 and $241, respectively	52,512	22,399
Inventories	4,188	2,104
Note receivable, net of allowance of $7,416 and $7,522, respectively	3,599	3,553
Investment in unconsolidated entities	58,971	206,790
Deferred costs, net	36,514	12,588
Prepaid expenses	22,757	7,017
Derivative assets, net	917	182
Other assets	7,969	17,116
Intangible assets, net	15,045	0
Due from Ashford Prime OP, net	335	896
Due from affiliates	0	3,473
Due from related party, net	1,922	0
Due from third-party hotel managers	39,047	12,241
Total assets	4,768,956	2,781,080
Liabilities:
Indebtedness	3,387,623	1,954,103
Accounts payable and accrued expenses	131,890	71,118
Dividends payable	23,346	21,889
Unfavorable management contract liabilities	4,836	5,330
Due to Ashford Inc., net	9,120	8,202
Due to related party, net	0	1,867
Due to third-party hotel managers	1,529	1,640
Intangible liabilities, net	27,262	0
Liabilities associated with marketable securities and other	12,771	6,201
Other liabilities	6,923	1,233
Total liabilities	3,605,300	2,071,583
Redeemable noncontrolling interests in operating partnership	165,590	177,064
Equity:
Common stock, $0.01 par value, 200,000,000 shares authorized, 124,896,765 shares issued, 101,078,531 and 89,439,624 shares outstanding at March 31, 2015 and December 31, 2014, respectively	1,249	1,249
Additional paid-in capital	1,801,656	1,706,274
Accumulated deficit	(696,787)	(1,050,323)
Treasury stock, at cost, 23,818,234 and 35,457,141 shares at March 31, 2015 and December 31, 2014, respectively	(108,985)	(125,725)
Total stockholders’ equity of the Company	997,291	531,633
Noncontrolling interests in consolidated entities	775	800
Total equity	998,066	532,433
Total liabilities and equity	4,768,956	2,781,080
Series A Cumulative Preferred Stock, 1,657,206 shares issued and outstanding at March 31, 2015 and December 31, 2014
Equity:
Preferred stock, $0.01 par value, 50,000,000 shares authorized:	17	17
Series D Cumulative Preferred Stock, 9,468,706 shares issued and outstanding at March 31, 2015 and December 31, 2014
Equity:
Preferred stock, $0.01 par value, 50,000,000 shares authorized:	95	95
Series E Cumulative Preferred Stock, 4,630,000 shares issued and outstanding at March 31, 2015 and December 31, 2014
Equity:
Preferred stock, $0.01 par value, 50,000,000 shares authorized:	$ 46	$ 46

XML

Income (Loss) Per Share (Summary of Computation of Diluted Income Per Share) (Details 1) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Net income (loss) allocated to common stockholders is not adjusted for:
Income allocated to unvested restricted shares	$ (2,035)	$ 0
Net income (loss) attributable to noncontrolling interest in operating partnership units		(877)
Total	2,200	(793)
Weighted average diluted shares are not adjusted for:
Effect of unvested restricted shares/assumed conversion of operating partnership units, Total	432	19,460
Effect of unvested restricted shares
Net income (loss) allocated to common stockholders is not adjusted for:
Income allocated to unvested restricted shares	$ 2,200	$ 84
Weighted average diluted shares are not adjusted for:
Effect of unvested restricted shares/assumed conversion of operating partnership units, Total	432	144
Effect of assumed conversion of operating partnership units
Weighted average diluted shares are not adjusted for:
Effect of unvested restricted shares/assumed conversion of operating partnership units, Total	0	19,316

XML

Consolidated Statement of Equity (USD $) In Thousands, unless otherwise specified	Total	Series A Preferred Stock [Member]	Series D Preferred Stock [Member]	Series E Preferred Stock [Member]	Common Stock	Preferred Stock Series A Preferred Stock [Member]	Preferred Stock Series D Preferred Stock [Member]	Preferred Stock Series E Preferred Stock [Member]	Common Stock	Additional Paid In Capital	Accumulated Deficit	Accumulated Deficit Series A Preferred Stock [Member]	Accumulated Deficit Series D Preferred Stock [Member]	Accumulated Deficit Series E Preferred Stock [Member]	Accumulated Deficit Common Stock	Treasury Stock	Treasury Stock Restricted Stock and Restricted Stock Units (RSUs) [Member]	Noncontrolling Interests In Consolidated Entities	Noncontrolling Interests in Operating Partnership
Beginning balance, value at Dec. 31, 2014	$ 177,064																		$ 177,064
Beginning balance, value at Dec. 31, 2014	532,433					17	95	46	1,249	1,706,274	(1,050,323)					(125,725)		800
Beginning balance, shares (in shares) at Dec. 31, 2014						1,657	9,469	4,630	124,897							35,457
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Purchases of treasury shares (in shares)																(43)
Purchases of treasury shares	(446)															(446)
Equity-based compensation	107									107
Equity-based compensation																			64
Issuance of restricted shares/units, value	0									(2,269)						2,269
Issuance of restricted shares/units, value																			33
Issuance of restricted shares/units (in shares)																1,013
Reissuance of treasury shares	110,939									96,228							14,711
Reissuance of treasury shares (in shares)																	10,530
Dividends		(886)	(5,000)	(2,604)	(12,129)				(11,964)			(886)	(5,000)	(2,604)	(12,129)
Distributions to noncontrolling interests	0																	0
Distributions to noncontrolling interests																			(2,726)
Redemption/conversion of operating partnership units	1,522									1,316	0						206
Redemption/conversion of operating partnership units (in shares)																	139
Redemption/conversion of operating partnership units																			(1,522)
Redemption value adjustment	52,659										52,659
Redemption value adjustment																			(52,659)
Net income (loss) attributable to the Company	321,496										321,496
Loss from consolidated entities attributable to noncontrolling interest	(25)																	(25)
Net income (loss)	321,471
Net (income) loss attributable to redeemable noncontrolling interests in operating partnership	(45,336)																		45,336
Ending balance, value at Mar. 31, 2015	165,590																		165,590
Ending balance, value at Mar. 31, 2015	$ 998,066					$ 17	$ 95	$ 46	$ 1,249	$ 1,801,656	$ (696,787)					$ (108,985)		$ 775
Ending balance, shares (in shares) at Mar. 31, 2015						1,657	9,469	4,630	124,897							23,818

XML

Investment in Hotel Properties, net (Acquisitions) (Details) (USD $)	3 Months Ended		0 Months Ended			3 Months Ended	0 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Feb. 06, 2015	Feb. 25, 2015	Mar. 06, 2015	Mar. 31, 2013	Apr. 29, 2015	Apr. 17, 2015	Mar. 25, 2015
Business Acquisition [Line Items]
Total revenue	$ 250,235,000	$ 194,861,000
Net income (loss) attributable to parent	321,496,000	(2,388,000)
Acquisition costs expensed	495,000
Gain on acquisition of PIM Highland JV	381,835,000	0
Equity in loss of unconsolidated entities	(6,622,000)	(3,498,000)
Lakeway Resort [Member]
Business Acquisition [Line Items]
Percent of voting interest acquired			100.00%
Consideration transferred			33,500,000
Total revenue	1,800,000
Net income (loss) attributable to parent	58,000
Lakeway Resort [Member] | Subsequent Event [Member]
Business Acquisition [Line Items]
Face amount of debt								25,100,000
Memphis Marriott [Member]
Business Acquisition [Line Items]
Percent of voting interest acquired				100.00%
Consideration transferred				43,500,000
Face amount of debt									33,300,000
Total revenue	1,200,000
Net income (loss) attributable to parent	152,000
PIM Highland JV [Member]
Business Acquisition [Line Items]
Percent of voting interest acquired					28.26%
Consideration transferred					250,100,000
Face amount of debt					907,600,000
Total revenue	37,600,000
Net income (loss) attributable to parent	434,000
Gain on acquisition of PIM Highland JV	381,800,000
Equity in loss of unconsolidated entities	3,800,000					2,800,000
Gainesville Hampton [Member] | Subsequent Event [Member]
Business Acquisition [Line Items]
Consideration transferred							$ 25,300,000

XML

Segment Reporting

3 Months Ended

Mar. 31, 2015

Segment Reporting [Abstract]

Segment Reporting

Segment Reporting

We operate in one business segment within the hotel lodging industry: direct hotel investments. Direct hotel investments refer to owning hotels 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 have similar economic characteristics and exhibit similar long-term financial performance. As of March 31, 2015 and December 31, 2014, all of our hotel properties were domestically located.

XML

Investment in Hotel Properties, net (Preliminary Fair Value of Assets and Liabilities) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014	Feb. 06, 2015	Feb. 25, 2015	Mar. 06, 2015
Business Acquisition [Line Items]
Gain on acquisition of PIM Highland JV	$ 381,835	$ 0
Lakeway Resort [Member]
Business Acquisition [Line Items]
Land			4,541
Buildings and improvements			24,703
Furniture, fixtures, and equipment			4,237
Land, buildings and improvements, furniture, fixtures, and equipment			33,481
Net other assets and liabilities			(382)
Memphis Marriott [Member]
Business Acquisition [Line Items]
Land				6,210
Buildings and improvements				32,934
Furniture, fixtures, and equipment				4,350
Land, buildings and improvements, furniture, fixtures, and equipment				43,494
Net other assets and liabilities				34
PIM Highland JV [Member]
Business Acquisition [Line Items]
Gain on acquisition of PIM Highland JV	381,800
Land					292,934
Buildings and improvements					1,351,293
Furniture, fixtures, and equipment					118,878
Land, buildings and improvements, furniture, fixtures, and equipment					1,763,105
Net other assets and liabilities					105,814
Indebtedness					$ (1,120,082)

XML

Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2015

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation—The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These consolidated financial statements include the accounts of Ashford Hospitality Trust, Inc., its majority-owned subsidiaries, and its majority-owned entities in which it has a controlling interest. All significant intercompany accounts and transactions between consolidated entities have been eliminated in these consolidated financial statements. These consolidated financial statements and related notes should be read in conjunction with the consolidated financial statements and notes thereto included in our 2014 Annual Report to Stockholders on Form 10-K and Form 10-K/A filed with the Securities and Exchange Commission (“SEC”) on March 2, 2015, and March 31, 2015, respectively.

The following items affect reporting comparability related to our consolidated financial statements:

• Historical seasonality patterns at some of our properties cause fluctuations in our overall operating results. Consequently, operating results for the three months ended March 31, 2015, are not necessarily indicative of the results that may be expected for the year ending December 31, 2015.

• On March 1, 2014, we completed the sale of the Pier House Resort to Ashford Prime (“Ashford Prime”). The results of the Pier House Resort, which we acquired on May 14, 2013, and sold on March 1, 2014, are included in our results of operations for the period from January 1, 2014, through February 28, 2014.

• On February 6, 2015, we acquired the Lakeway Resort & Spa, and on February 25, 2015, we acquired the Memphis Marriott East hotel. The results of these hotels are included in our results of operations as of their respective acquisition dates.

• On March 6, 2015, we acquired the remaining approximate 28.26% interest in the 28 hotels of the PIM Highland JV. For the period January 1, 2014, through March 5, 2015, we have recorded equity in earnings for our ownership percentage. Beginning March 6, 2015, we consolidated the results of operations of these hotels.

Use of Estimates

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.

Restricted Cash

Restricted Cash—Restricted cash includes reserves for debt service, real estate taxes, and insurance, as well as excess cash flow deposits and reserves for furniture, fixtures, and equipment replacements of approximately 3% to 6% of property revenue for certain hotels, as required by certain management or mortgage debt agreement restrictions and provisions. For purposes of the consolidated statements of cash flows, changes in restricted cash caused by using such funds for debt service, real estate taxes, and insurance are shown as operating activities. Changes in restricted cash caused by using such funds for furniture, fixtures, and equipment replacements are included in cash flows from investing activities.

Investments in Hotel Properties, net

Investments in Hotel Properties, net—Hotel properties are generally stated at cost. However, four hotel properties contributed upon Ashford Trust’s formation in 2003 are stated at the predecessor’s historical cost, net of impairment charges, if any, plus a partial step-up related to the acquisition of noncontrolling interests from third parties associated with certain of these properties. For hotel properties owned through our majority-owned entities, the carrying basis attributable to the partners’ minority ownership is recorded at the predecessor’s historical cost, net of any impairment charges, while the carrying basis attributable to our majority ownership is recorded based on the allocated purchase price of our ownership interests in the entities. All improvements and additions which extend the useful life of hotel properties are capitalized.

Impairment of Investment in Hotel Properties

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. No impairment charges were recorded for investments in hotel properties for the three months ended March 31, 2015 and 2014.

Hotel Disposition

Hotel Dispositions—Effective January 1, 2015, 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 anticipate that dispositions of hotel properties will 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. This new guidance is to be implemented prospectively only. As such, hotel property dispositions that occurred prior to December 31, 2014, will continue to be reported as discontinued operations in the statements of operations for all applicable periods presented. See Note 4.

Assets Held for Sale and Discontinued Operations

Assets Held for Sale and Discontinued Operations—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 or group of components that represents a strategic shift that has (or will have) a major effect on our operations and cash flows.

Intangible Assets and Liabilities, Policy [Policy Text Block]

Intangible Assets and Liabilities—Intangible assets and liabilities represent the assets and liabilities recorded on certain hotel properties’ ground lease contracts that were below or above market rates at the date of acquisition. These assets and liabilities are amortized using the straight-line method over the remaining terms of the respective lease contracts.

Notes Receivable

Note Receivable—Mezzanine loan financing, classified as note receivable, represents a loan held for investment and intended to be held to maturity. Note receivable is recorded at cost, net of unamortized loan origination costs and fees, loan purchase discounts, and allowance for losses when a loan is deemed to be impaired. Premiums, discounts, and net origination fees are amortized or accreted as an adjustment to interest income using the effective interest method over the life of the loan. We discontinue recording interest and amortizing discounts/premiums when the contractual payment of interest and/or principal is not received when contractually due. Payments received on impaired nonaccrual loans are recorded as adjustments to impairment charges. No interest income was recorded for the three months ended March 31, 2015 and 2014.

Variable interest entities (“VIEs”), as defined by authoritative accounting guidance, must be consolidated by their controlling interest beneficiaries if the VIEs do not effectively disperse risks among the parties involved. Our remaining mezzanine note receivable at March 31, 2015, is secured by a hotel property and is subordinate to the controlling interest in the secured hotel property. Although the note receivable is considered to be a variable interest in the entity that owns the related hotel, we are not considered to be the primary beneficiary of the hotel property as a result of holding the loan. Therefore, we do not consolidate the hotel property for which we have provided financing. We will evaluate interests in entities acquired or created in the future to determine whether such entities should be consolidated. In evaluating VIEs, our analysis involves considerable management judgment and assumptions.

Impairment of Notes Receivable

Impairment of Note Receivable—We review notes receivable for impairment each reporting period. A loan is impaired when, based on current information and events, collection of all amounts recorded as assets on the balance sheet is no longer considered probable. We apply normal loan review and underwriting procedures (as may be implemented or modified from time to time) in making that judgment.

When a loan is impaired, we measure impairment based on the present value of expected cash flows discounted at the loan’s effective interest rate against the value of the asset recorded on the balance sheet. We may also measure impairment based on a loan’s observable market price or the fair value of collateral if the loan is collateral-dependent. 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 during the three months ended March 31, 2015 and 2014. Valuation adjustments of $(106,000) and $(101,000) on previously impaired notes were credited to impairment charges during the three months ended March 31, 2015 and 2014, respectively.

Investments in Unconsolidated Entities

Investments in Unconsolidated Entities—Investments in entities in which we have ownership interests ranging from 14.4% to 30.1% 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 in our unconsolidated entities for impairment in 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 impairment is recorded in equity earnings (loss) in unconsolidated entities. No such impairment was recorded in the three months ended March 31, 2015 and 2014.

Our investments in certain unconsolidated entities are considered to be variable interests in the underlying entities. Variable Interest Entities (“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, (ii) an implicit financial responsibility to ensure that a VIE operates as designed, and (iii) 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 should not be consolidated. In evaluating VIEs, our analysis involves considerable management judgment and assumptions.

Marketable Securities

Marketable Securities—Marketable securities, including U.S. treasury bills, publicly traded equity securities and stocks, and put and call options on certain publicly traded securities. All of these investments are recorded at fair value. Put and call options are considered derivatives. The fair value of these investments has been determined based on the closing price as of the balance sheet date and is reported as “marketable securities” or “liabilities associated with marketable securities and other” in the consolidated balance sheets. The cost of securities sold is determined by using the high cost method. Net investment income, including interest income (expense), dividends, realized gains or losses and costs of investment, is reported as a component of “other income.” Unrealized gains and losses on these investments are reported as “unrealized gain (loss) on marketable securities” in the consolidated statements of operations.

Due To / From Affiliates

Due to/from Affiliates—Due to/from affiliates represents current receivables and payables resulting primarily from advances of shared costs incurred. Both due to/from affiliates are generally settled within a period not exceeding one year.

Due To / From Related Party

Due to/from Related Party—Due to/from related party represents current receivables and payables resulting from transactions related to hotel management, project management and market services with a related party. Due to/from related party is generally settled within a period not exceeding one year.

Due To / From Ashford Prime OP, net

Due to/from Ashford Prime OP, net—Due to/from Ashford Prime OP represents receivables and payables resulting primarily from miscellaneous operating and capital improvement true-ups between the two entities. In 2014, we had receivables related to advisory fees. Both due to/from Ashford Prime OP is generally settled within a period not exceeding one year.

Due To Ashford Inc., net

Due to Ashford Inc., net—Due to Ashford Inc., net, represents current payables resulting primarily from advisory services fee, including reimbursable expenses. In 2014, due to Ashford Inc., net, included payables resulting primarily from costs associated with the spin-off of Ashford Inc. Due to Ashford Inc., net, is generally settled within a period not exceeding one year.

Revenue Recognition

Revenue Recognition—Hotel revenues, including room, food, beverage, and ancillary revenues such as long-distance telephone service, laundry, parking and space rentals, are recognized when services have been rendered. Taxes collected from customers and submitted to taxing authorities are not recorded in revenue. Interest income (including accretion of discounts on the mezzanine loan using the effective interest method) is recognized when earned. We discontinue recording interest and amortizing discounts/premiums when the contractual payment of interest and/or principal is not received when contractually due. We are reimbursed by PIM Highland JV for costs associated with managing its day-to-day operations and providing corporate administrative services such as accounting, insurance, marketing support, asset management and other services. Beginning with the three months ended March 31, 2014, we changed the presentation to report such reimbursements as “Other” revenue as opposed to credits within “Corporate, general and administrative” expense. This change had no impact on our financial condition or results of operations. As of March 6, 2015, we acquired the remaining approximate 28.26% of the PIM Highland JV which discontinued the aforementioned reimbursements.

Prior to the spin-off of Ashford Inc. in November 2014, we recognized advisory services revenue when services had been rendered. The quarterly base fee was equal to 0.7% per annum of the total market capitalization, as defined in the advisory agreement, of Ashford Prime, subject to certain minimums. Reimbursements for overhead and internal audit services was recognized when services had been rendered. We also recorded advisory services revenue for equity grants of Ashford Prime common stock and LTIP units awarded to our officers and employees in connection with providing advisory services equal to the fair value of the award in proportion to the requisite service period satisfied during the period, as well as an offsetting expense in an equal amount included in “corporate, general and administrative” expense.

Derivatives and Hedges

Derivatives Instruments and Hedging—We use interest rate derivatives to hedge our risks and to capitalize on the historical correlation between changes in LIBOR (London Interbank Offered Rate) and RevPAR (Revenue per Available Room). Interest rate derivatives could include swaps, caps, floors and flooridors. We assess the effectiveness of each hedging relationship by comparing changes in fair value or cash flows of the derivative hedging instrument with the changes in fair value or cash flows of the designated hedged item or transaction. We also use credit default swaps to hedge financial and capital market risk. All of our derivatives are subject to master-netting settlement arrangements and the credit default swaps are subject to credit support annexes. For credit default swaps, cash collateral is posted by us as well as our counterparty. We offset the fair value of the derivative and the obligation/right to return/reclaim cash collateral.

All derivatives are recorded at fair value in accordance with the applicable authoritative accounting guidance. Interest rate derivatives and credit default swaps are reported as “Derivative assets, net” or “Liabilities associated with marketable securities and other” in the consolidated balance sheets. Accrued interest on non-hedge designated interest rate derivatives is included in “Accounts receivable, net” in the consolidated balance sheets. For interest rate derivatives designated as cash flow hedges:

a) the effective portion of changes in fair value is initially reported as a component of “Accumulated other comprehensive income (loss)” (“OCI”) in the equity section of the consolidated balance sheets and reclassified to interest expense in the consolidated statements of operations in the period during which the hedged transaction affects earnings, and

b) the ineffective portion of changes in fair value is recognized directly in earnings as “Unrealized gain (loss) on derivatives” in the consolidated statements of operations. For the three months ended March 31, 2015 and 2014, there was no ineffectiveness.

For non-hedge designated interest rate derivatives and credit default swaps, changes in fair value are recognized in earnings as “unrealized loss on derivatives” in the consolidated statements of operations.

Income Taxes

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 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.

The “Income Taxes” Topic of the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification 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 2011 through 2014 remain subject to potential examination by certain federal and state taxing authorities.

Reclassification

Reclassification—Certain amounts in the consolidated financial statements for the three months ended March 31, 2014, have been reclassified for discontinued operations.

Recently Adopted Accounting Standards

Recently Adopted Accounting Standards—In April 2014, the FASB issued accounting guidance that revises the definition of discontinued operations by limiting discontinued operations reporting to disposals of components of an entity that represent strategic shifts that have (or will have) a major effect on an entity’s operations and financial results, removing the lack of continuing involvement criteria and requiring discontinued operations reporting for the disposal of an equity method investment that meets the definition of discontinued operations. The update also requires expanded disclosures for discontinued operations, including disclosure of pretax profit or loss of an individually significant component of an entity that does not qualify for discontinued operations reporting. The new accounting guidance is effective prospectively for fiscal years, and interim periods within those years, beginning after December 15, 2014. We adopted this accounting guidance on January 1, 2015. The adoption of this accounting guidance impacted the presentation of our results of operations as it required the operations of our disposed hotel property to be included in continuing operations.

Recently Issued Accounting Standards

Recently Issued Accounting Standards—In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). ASU 2014-09 is a comprehensive new revenue recognition model, which requires a company to recognize revenue to depict the transfer of promised goods or services to a customer in an amount that reflects the consideration the company expects to receive in exchange for those goods or services. The update will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. ASU 2014-09 is effective in fiscal periods beginning after December 15, 2016. Early adoption is not permitted. The standard permits the use of either the retrospective or cumulative effect transition method. We are evaluating the effect that ASU 2014-09 will have on our consolidated financial statements and related disclosures. We have not yet selected a transition method.

In August 2014, the FASB issued ASU 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (“ASU 2014-15”), to provide guidance on management's responsibility to perform interim and annual assessments of an entity’s ability to continue as a going concern and to provide related disclosure requirements. ASU 2014-15 applies to all entities and is effective for annual periods ending after December 15, 2016, and interim periods thereafter, with early adoption permitted. We do not expect the adoption of this standard will have an impact on our financial position, results of operations or cash flows.

In February 2015, the FASB issued ASU 2015-02, Amendments to the Consolidation Analysis. The ASU amends the consolidation guidance for VIEs and general partners' investments in limited partnerships and modifies the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities. The ASU is effective for interim and annual reporting periods beginning after December 15, 2015, with early adoption permitted. We are currently evaluating the effect of the ASU on our consolidated financial statements and related disclosures.

In April 2015, the FASB issued Accounting Standards Update (“ASU”) No. 2015-03, Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. The new standard requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The standard is effective for annual reporting periods beginning after December 15, 2015, and interim periods within those fiscal years, with early adoption permitted. Upon adoption of the standard we will reclassify deferred financing costs, net from total assets to be shown net of debt in the liabilities section of our consolidated balance sheet. Adoption of this standard will only affect the presentation of our consolidated balance sheet.

XML

Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Cash Flows from Operating Activities
Net income (loss)	$ 366,807	$ (3,292)
Adjustments to reconcile net income (loss) to net cash flow provided by operating activities:
Depreciation and amortization	37,864	26,229
Impairment charges	(106)	(101)
Amortization of loan costs and premiums, write-off of loan costs and exit fees	7,646	3,967
Bad debt expense	152	0
Equity in (earnings) loss of unconsolidated entities	6,622	3,498
Distribution of earnings from unconsolidated entities	249	0
Gain on sale of hotel property	(380,705)	(3,503)
Realized and unrealized gains on marketable securities	(2,275)	(1,064)
Purchases of marketable securities	(64,346)	(22,553)
Sales of marketable securities	64,036	22,319
Net settlement of trading derivatives	(1,367)	(253)
Unrealized loss on derivatives	1,698	347
Equity-based compensation	171	4,488
Changes in operating assets and liabilities, exclusive of effect of acquisitions and dispositions of hotel properties:
Restricted cash	3,003	(1,551)
Accounts receivable and inventories	(10,405)	(8,990)
Prepaid expenses and other assets	(6,690)	(5,413)
Accounts payable and accrued expenses	13,780	2,513
Due from affiliates	3,473	541
Due to/from related party	(6,315)	(1,114)
Due to/from third-party hotel managers	(8,295)	(1,828)
Due to/from Ashford Prime OP, net	561	(2,655)
Due to/from Ashford Inc., net	918	0
Other liabilities	3,851	(504)
Net cash provided by operating activities	30,327	11,081
Cash Flows from Investing Activities
Proceeds from payments of note receivable	60	61
Net proceeds from sales of hotel properties	7,502	22,402
Dividends from Ashford Prime OP	0	249
Acquisition of hotel properties, net of cash acquired	(287,618)	0
Change in restricted cash related to improvements and additions to hotel properties	49,703	0
Improvements and additions to hotel properties	(28,812)	(26,956)
Due from Ashford Prime OP	0	13,635
Payments of franchise fees	(175)	0
Proceeds from property insurance	282	0
Net cash provided by (used in) investing activities	(259,058)	9,391
Cash Flows from Financing Activities
Borrowings on indebtedness	1,581,032	200,000
Repayments of indebtedness and capital leases	(1,267,467)	(169,503)
Payments of loan costs and exit fees	(31,558)	(3,831)
Payments of dividends	(21,888)	(20,734)
Purchases of treasury shares	(446)	(231)
Payments for derivatives	(1,250)	(216)
Issuances of treasury stock	110,939	307
Distributions to noncontrolling interests in consolidated entities	0	(980)
Other	33	46
Net cash provided by financing activities	369,395	4,858
Net increase in cash and cash equivalents	140,664	25,330
Cash and cash equivalents at beginning of period	215,063	128,780
Cash and cash equivalents at end of period	355,727	154,110
Supplemental Cash Flow Information
Interest paid	26,543	24,588
Income taxes paid	197	19
Supplemental Disclosure of Non-Cash Investing and Financing Activity
Accrued but unpaid capital expenditures	6,522	2,927
Deferred compensation to be settled in shares	0	183
Dividend receivable from Ashford Prime OP	249	249
Transfer of debt to Ashford Prime OP	0	69,000
Dividends declared but not paid	$ 23,346	$ 20,890

XML

Consolidated Balance Sheets (Parenthetical) (USD $) In Thousands, except Share data, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Allowance for doubtful accounts receivable	$ 417	$ 241
Allowance for doubtful notes receivable	$ 7,416	$ 7,522
Preferred stock, par value (in dollars per shares)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	50,000,000	50,000,000
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	200,000,000	200,000,000
Common stock, shares issued (in shares)	124,896,765	124,896,765
Common stock, shares outstanding (in shares)	101,078,531	89,439,624
Treasury stock, shares (in shares)	23,818,234	35,457,141
Series A Cumulative Preferred Stock, 1,657,206 shares issued and outstanding at March 31, 2015 and December 31, 2014
Preferred stock, shares issued (in shares)	1,657,206	1,657,206
Preferred stock, shares outstanding (in shares)	1,657,206	1,657,206
Series D Cumulative Preferred Stock, 9,468,706 shares issued and outstanding at March 31, 2015 and December 31, 2014
Preferred stock, shares issued (in shares)	9,468,706	9,468,706
Preferred stock, shares outstanding (in shares)	9,468,706	9,468,706
Series E Cumulative Preferred Stock, 4,630,000 shares issued and outstanding at March 31, 2015 and December 31, 2014
Preferred stock, shares issued (in shares)	4,630,000	4,630,000
Preferred stock, shares outstanding (in shares)	4,630,000	4,630,000

XML

Fair Value Measurements

3 Months Ended

Mar. 31, 2015

Fair Value Disclosures [Abstract]

Fair Value Measurements

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 market place 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 is obtained from exchange or dealer markets.

• 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.

Fair values of interest rate swaps are determined using the market standard methodology of netting the discounted future fixed cash receipts/payments and the discounted expected variable cash payments/receipts. Fair values of interest rate caps, floors, flooridors, and corridors are determined using the market standard methodology of discounting the future expected cash receipts that would occur if variable interest rates fell 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 swaps, caps, and floors are based on an expectation of future interest rates derived from observable market interest rate curves (LIBOR 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.

Fair values of credit default swaps are obtained from a third party who publishes various information including the index composition and price data (Level 2 inputs). The fair value of credit default swaps does not contain credit-risk-related adjustments as the change in fair value is settled net through posting cash collateral or reclaiming cash collateral between us and our counterparty.

Fair values of marketable securities and liabilities associated with marketable securities, including public equity securities, equity put and call options, and other investments, are based on their quoted market closing prices (Level 1 inputs).

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 March 31, 2015, the LIBOR interest rate forward curve (Level 2 inputs) assumed an uptrend from 0.18% to 1.31% for the remaining term of our derivatives. Credit spreads (Level 3 inputs) used in determining the fair values of hedge and non-hedge designated derivatives assumed an uptrend in nonperformance risk for us and all of our counterparties through the maturity dates.

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 Market Prices (Level 1)			Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Counterparty and Cash Collateral Netting(4)			Total
March 31, 2015:
Assets
Derivative assets:
Interest rate derivatives - non-hedge	$	—		$	414	$	—	$	—		$	414		(1)
Credit default swaps	—			1,331		—		(828		)	503			(1)
Equity put options	935			—		—		—			935			(2)
Equity call options	267			—		—		—			267			(2)
Non-derivative assets:
Equity	53,155			—		—		—			53,155			(2)
U.S. treasury securities	18,070			—		—		—			18,070			(2)
Total	72,427			1,745		—		(828		)	73,344
Liabilities
Derivative liabilities:
Short equity put options	(353		)	—		—		—			(353		)	(3)
Short equity call options	(694		)	—		—		—			(694		)	(3)
Non-derivative liabilities:
Equity	(1,427		)	—		—		—			(1,427		)	(3)
Margin account balance	(10,297		)	—		—		—			(10,297		)	(3)
Total	(12,771		)	—		—		—			(12,771		)
Net	$	59,656		$	1,745	$	—	$	(828	)	$	60,573
December 31, 2014:
Assets
Derivative assets:
Interest rate derivatives - non-hedge	$	—		$	182	$	—	$	—		$	182		(1)
Equity put options	653			—		—		—			653			(2)
Equity call options	1			—		—		—			1			(2)
Non-derivative assets:
Equity securities	57,941			—		—		—			57,941			(2)
U.S. treasury securities	4,622			—		—		—			4,622			(2)
Total	63,217			182		—		—			63,399
Liabilities
Derivative liabilities:
Credit default swaps	—			379		—		(563		)	(184		)	(3)
Short equity put options	(216		)	—		—		—			(216		)	(3)
Short equity call options	(781		)	—		—		—			(781		)	(3)
Non-derivative liabilities:
Short equity securities	(17		)	—		—		—			(17		)	(3)
Margin account balance	(5,003		)	—		—		—			(5,003		)	(3)
Total	(6,017		)	379		—		(563		)	(6,201		)
Net	$	57,200		$	561	$	—	$	(563	)	$	57,198

____________________________________

⁽¹⁾ Reported net as “derivative assets, net” in the consolidated balance sheets.

⁽²⁾ Reported as “marketable securities” in the consolidated balance sheets.

⁽³⁾ Reported as “liabilities associated with marketable securities and other” in the consolidated balance sheets.

⁽⁴⁾ Represents cash collateral posted by our counterparty.

Effect of Fair-Value-Measured Assets and Liabilities on Consolidated Statements of Operations

The following tables summarize the effect of fair-value-measured assets and liabilities on the consolidated statements of operations for the three months ended March 31, 2015 and 2014 (in thousands):

	Gain (Loss) Recognized in Income								Reclassified from Accumulated OCI  into Interest Expense
	Three Months Ended March 31,								Three Months Ended March 31,
	2015				2014				2015		2014
Assets
Derivative assets:
Interest rate derivatives	$	(1,018	)		$	(121	)		$	—	$	71
Equity put options	(1,290		)		(462		)		—		—
Equity call options	80				(50		)		—		—
Credit default swaps	(737		)		(247		)		—		—
Non-derivative assets:
Equity - American Depositary Receipt	(65		)		—				—		—
Equity	2,063				948				—		—
U.S. Treasury	406				294				—		—
Total	(561		)		362				—		71
Liabilities
Derivative liabilities:
Short equity put options	595				4				—		—
Short equity call options	579				391				—		—
Non-derivative liabilities:
Short equity securities	(36		)		—				—		—
Total	1,138				395				—		—
Net	$	577			$	757			$	—	$	71
Total combined
Interest rate derivatives	$	(1,018	)		$	(121	)		$	—	$	71
Credit default swaps	(680		)		(226		)		—		—
Total derivatives	(1,698		)	(1)	(347		)	(1)	—		71
Unrealized gain (loss) on marketable securities	(1,802		)	(3)	1			(3)	—		—
Realized gain on marketable securities	4,077			(2) (4)	1,103			(2) (4)	—		—
Net	$	577			$	757			$	—	$	71

____________________________________

⁽¹⁾ Reported as “unrealized loss on derivatives” in the consolidated statements of operations.

⁽²⁾ Included in “other income” in the consolidated statements of operations.

⁽³⁾ Reported as “unrealized gain (loss) on marketable securities” in the consolidated statements of operations.

⁽⁴⁾ Includes costs of $57 and $21 for the three months ended March 31, 2015 and 2014, respectively, associated with credit default swaps.

There was no change in fair value of our interest rate derivatives that were recognized in other comprehensive loss for the three months ended March 31, 2014.

XML

Document and Entity Information	3 Months Ended
	Mar. 31, 2015	May 07, 2015
Document and Entity Information [Abstract]
Entity Registrant Name	ASHFORD HOSPITALITY TRUST INC
Entity Central Index Key	0001232582
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Document Period End Date	Mar. 31, 2015
Amendment Flag	false
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	Q1
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		101,068,813

XML

Summary of Fair Value of Financial Instruments

3 Months Ended

Mar. 31, 2015

Investments, All Other Investments [Abstract]

Summary of Fair Value of Financial Instruments

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):

	March 31, 2015				December 31, 2014
	Carrying Value		Estimated Fair Value		Carrying Value		Estimated Fair Value
Financial assets and liabilities measured at fair value:
Marketable securities	$	72,427	$	72,427	$	63,217	$	63,217
Derivative assets, net	917		917		182		182
Liabilities associated with marketable securities and other	12,771		12,771		6,201		6,201
Financial assets not measured at fair value:
Cash and cash equivalents	$	355,727	$	355,727	$	215,063	$	215,063
Restricted cash	143,043		143,043		85,830		85,830
Accounts receivable, net	52,512		52,512		22,399		22,399
Note receivable, net	3,599		3,117 to 3,445		3,553		3,049 to 3,370
Due from affiliates	—		—		3,473		3,473
Due from Ashford Prime OP, net	335		335		896		896
Due from related party, net	1,922		1,922		—		—
Due from third-party hotel managers	39,047		39,047		12,241		12,241
Financial liabilities not measured at fair value:
Indebtedness	$	3,387,623	$3,267,372 to $3,611,305		$	1,954,103	$1,905,801 to $2,106,413
Accounts payable and accrued expenses	131,890		131,890		71,118		71,118
Dividends payable	23,346		23,346		21,889		21,889
Due to Ashford Inc., net	9,120		9,120		8,202		8,202
Due to related party, net	—		—		1,867		1,867
Due to third-party hotel managers	1,529		1,529		1,640		1,640

Cash, cash equivalents, and restricted cash. These financial assets bear interest at market rates and have 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, dividends payable, due to/from Ashford Prime OP, due to/from related party, due from affiliates, due to/from Ashford Inc. 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.

Note receivable, net. Fair value of notes receivable is determined using similar loans with similar collateral. We relied on our internal analysis of what we believe a willing buyer would pay for this note. We estimated the fair value of the note receivable to be approximately 13.4% to 4.3% lower than the carrying value of $3.6 million at March 31, 2015 and approximately 14.2% to 5.2% lower than the carrying value of $3.6 million at December 31, 2014. This is considered a Level 2 valuation technique.

Marketable securities. Marketable securities consist of U.S. treasury bills, publicly traded equity securities, and put and call options on certain publicly traded equity securities. The fair value of these investments is based on quoted market closing prices at the balance sheet dates. See Notes 2, 9 and 10 for a complete description of the methodology and assumptions utilized in determining fair values.

Indebtedness. Fair value of indebtedness is determined using future cash flows discounted at current replacement rates for these instruments. Cash flows are determined using a forward interest rate yield curve. Current replacement rates are determined by using the U.S. Treasury yield curve or the index to which these financial instruments are tied and adjusted for credit spreads. Credit spreads take into consideration general market conditions, maturity, and collateral. We estimated the fair value of total indebtedness to be approximately 96.5% to 106.6% of the carrying value of $3.4 billion at March 31, 2015 and approximately 97.5% to 107.8% of the carrying value of $2.0 billion at December 31, 2014. This is considered a Level 2 valuation technique.

Derivative assets and liabilities associated with marketable securities and other. Fair value of interest rate derivatives is determined using the net present value of expected cash flows of each derivative based on the market-based interest rate curve and adjusted for credit spreads of us and our counterparties. Fair values of credit default swap derivatives are obtained from a third party who publishes the CMBX index composition and price data. Liabilities associated with marketable securities and other consists of a margin account balance, short public equity securities and short equity put and call options. Fair value is determined based on quoted market closing prices at the balance sheet dates. See Notes 2, 9 and 10 for a complete description of the methodology and assumptions utilized in determining fair values.

XML

Consolidated Statements of Operations (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Revenue
Rooms	$ 200,990	$ 156,997
Food and beverage	39,553	28,239
Other hotel revenue	8,832	6,366
Total hotel revenue	249,375	191,602
Advisory services revenue	0	2,194
Other	860	1,065
Total revenue	250,235	194,861
Hotel operating expenses:
Rooms	43,153	34,754
Food and beverage	26,280	19,323
Other expenses	74,782	58,274
Management fees	9,657	7,742
Total hotel expenses	153,872	120,093
Property taxes, insurance, and other	11,594	9,589
Depreciation and amortization	37,864	26,152
Impairment charges	(106)	(101)
Transaction costs	499	0
Advisory services fee	9,567	0
Corporate, general, and administrative	4,840	12,735
Total expenses	218,130	168,468
Operating income	32,105	26,393
Equity in loss of unconsolidated entities	(6,622)	(3,498)
Interest income	16	6
Gain on acquisition of PIM Highland JV	381,835	0
Other income	4,330	1,277
Interest expense and amortization of premiums and loan costs	(34,635)	(28,375)
Write-off of loan costs and exit fees	(4,767)	(2,028)
Unrealized gain (loss) on marketable securities	(1,802)	1
Unrealized loss on derivatives	(1,698)	(347)
Income (loss) from continuing operations before income taxes	368,762	(6,571)
Income tax expense	(825)	(216)
Income (loss) from continuing operations	367,937	(6,787)
Income from discontinued operations	0	4
Gain (loss) on sale of hotel properties, net of tax	(1,130)	3,491
Net income (loss)	366,807	(3,292)
Loss from consolidated entities attributable to noncontrolling interest	25	27
Net (income) loss attributable to redeemable noncontrolling interests in operating partnership	(45,336)	877
Net income (loss) attributable to the Company	321,496	(2,388)
Preferred dividends	(8,490)	(8,490)
Net income (loss) attributable to common stockholders	313,006	(10,878)
Basic:
Income (loss) from continuing operations attributable to common stockholders	$ 3.25	$ (0.13)
Income from discontinued operations attributable to common stockholders	$ 0.00	$ 0.00
Net income (loss) attributable to common stockholders	$ 3.25	$ (0.13)
Weighted average common shares outstanding – basic	95,539	81,690
Diluted:
Income (loss) from continuing operations attributable to common stockholders	$ 3.13	$ (0.13)
Income from discontinued operations attributable to common stockholders	$ 0.00	$ 0.00
Net income (loss) allocated to common stockholders per share	$ 3.13	$ (0.13)
Weighted average common shares outstanding – diluted	113,912	81,690
Dividends declared per common share (in dollars per share)	$ 0.12	$ 0.12
Amounts attributable to common stockholders:
Net income (loss) attributable to the Company	321,496	(2,391)
Income from discontinued operations	0	3
Net income (loss) attributable to common stockholders	$ 313,006	$ (10,878)

XML

Note Receivable

3 Months Ended

Mar. 31, 2015

Receivables [Abstract]

Note Receivable

Note Receivable

At March 31, 2015 and December 31, 2014, we had one mezzanine loan receivable with a net carrying value of $3.6 million, net of a valuation allowance of $7.4 million and $7.5 million, respectively. This note is secured by one hotel property, bears interest at a rate of 6.09%, and matures in 2017. All required payments on this loan are current. Ongoing payments are treated as reductions of carrying value with related valuation allowance adjustments recorded as credits to impairment charges.

XML

Hotel Dispositions

3 Months Ended

Mar. 31, 2015

Discontinued Operations and Disposal Groups [Abstract]

Hotel Dispositions

Hotel Dispositions

Effective January 1, 2015, discontinued operations according to ASU 2014-08 are defined as the disposal of components of an entity that represent strategic shifts that have (or will have) a major effect on an entity’s operations and financial results. As a result, operations of hotels sold subsequent to December 31, 2014 will continue to be reported in continuing operations, while gains/losses on disposition will be included in gain/loss on sale of property, after continuing operations. For transactions that have been classified as discontinued operations for periods prior to ASU 2014-08, we will continue to present the operating results as discontinued operations in the statements of operations for all applicable periods presented.

In March 2015, we completed the sale of the Hampton Inn hotel in Terre Haute, Indiana. We included operations for this hotel through the date of disposition in income (loss) from continuing operations as shown in the consolidated statements of operations for the three months ended March 31, 2015 and 2014, as disposition of this hotel does not represent a strategic shift in our business.

The following table includes condensed financial information from this hotel (in thousands):

	Three Months Ended March 31,
	2015			2014
Total hotel revenue	$	361		$	472
Total hotel operating expenses	(308		)	(430		)
Operating income	53			42
Property taxes, insurance and other	(40		)	(41		)
Depreciation and amortization	(164		)	(150		)
Interest expense and amortization of loan costs	—			(128		)
Loss from continuing operations	(151		)	(277		)
Loss on sale of hotel property	(1,130		)	—
Net loss	(1,281		)	(277		)
Net loss from continuing operations attributable to redeemable noncontrolling interests in operating partnership	147			36
Loss from continuing operations attributable to the Company	$	(1,134	)	$	(241	)

In November 2014, we completed the sale of the Homewood Suites hotel in Mobile, Alabama. Since this hotel sold prior to ASU 2014-08, we will continue to present the operating results as discontinued operations in the statements of operations for all applicable periods presented. The following table includes condensed financial information from this hotel for the three months ended March 31, 2014 (in thousands):

	Three Months Ended March 31,
	2014
Hotel revenues	$	735
Hotel operating expenses	(473		)
Operating income	262
Property taxes, insurance and other	(31		)
Depreciation and amortization	(77		)
Interest expense and amortization of loan costs	(150		)
Net income	4
Income from discontinued operations attributable to redeemable noncontrolling interests in operating partnership	(1		)
Income from discontinued operations attributable to the Company	$	3

XML

Subsequent Events

3 Months Ended

Mar. 31, 2015

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

On April 17, 2015, we completed the financing of a $25.1 million mortgage loan, secured by the Lakeway Resort in Austin, Texas. The new mortgage loan is interest only and provides for a floating interest rate of LIBOR + 5.10%. The stated maturity is May 2017, with threeone-year extension options.

On April 29, 2015, we completed the acquisition of the 124-room Hampton Inn & Suites in Gainesville, Florida for total consideration of $25.3 million in cash.

The unaudited pro forma results of operations as if the acquisition had occurred on January 1, 2014, is included in Note 3.

XML

Redeemable Noncontrolling Interests in Operating Partnership

3 Months Ended

Mar. 31, 2015

Redeemable Noncontrolling Interest, Equity, Carrying Amount [Abstract]

Redeemable Noncontrolling Interests in Operating Partnership

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 (“common units”) and the units issued under our Long-Term Incentive Plan (the “LTIP units”) that are vested throughout the period plus distributions paid to the limited partners with regard to the Class B common units. Class B common units have a fixed dividend rate of 6.82% in years one to three and 7.2% thereafter, and have priority in payment of cash dividends over common units but otherwise have no preference over common units. Aside from the Class B common units, all other outstanding units represent common units. Beginning one year after issuance, each common unit (including each Class B common unit) may be redeemed for either cash or, at our sole discretion, up to one share of our common stock. Beginning ten years after issuance, each Class B common unit may be converted into a common unit at either party’s discretion. As a result of the Ashford Inc. spin-off, holders of our common stock were distributed one share of Ashford Inc. common stock for every 87 shares of our common stock, while our unit holders received one common unit of the operating limited liability company subsidiary of Ashford Inc. for each common unit of our operating partnership the holder held, and such holder then had the opportunity to exchange up to 99% of those units for shares of Ashford Inc. common stock at the rate of one share of Ashford Inc. common stock for every 55 common units. Following the spin-off, Ashford Hospitality Trust, Inc. continues to hold 598,000 shares of Ashford Inc. common stock for the benefit of its common stockholders, and all of our remaining lodging investments are owned by Ashford Trust OP. Therefore, each common unit and LTIP unit was worth approximately 93% and 94% of one share of our common stock at March 31, 2015 and December 31, 2014, respectively.

LTIP units, which are issued to certain executives and employees of Ashford LLC as compensation, have vesting periods ranging from three to five 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, which results from a capital account revaluation, as defined in the partnership agreement, for the operating partnership.

As of March 31, 2015, we have issued a total of 8.7 million LTIP units, all of which, other than approximately 660,000 units, issued in March 2015, have reached full economic parity with, and are convertible into, common units. Expense of $64,000 was recognized for the three months ended March 31, 2015, all of which was associated with LTIP units issued to Ashford LLC’s employees and is included in “advisory services fee” in our consolidated statements of operations. As the LTIP units are issued to non-employees, the compensation expense was determined based on the share price as of the end of the period. Compensation expense of $3.9 million associated with the issuance of LTIP units was recognized for the three months ended March 31, 2014, while we were self-advised. The fair value of the unamortized LTIP units, which was $5.8 million at March 31, 2015, will be amortized over a period of 3.0 years.

During the three months ended March 31, 2015, 150,000 common units with an aggregate fair value of $1.5 million were redeemed by the holder and, at our election, we issued shares of our common stock to satisfy the redemption price. During the three months ended March 31, 2014, no common units were presented for redemption.

Redeemable noncontrolling interests, including vested LTIP units, in our operating partnership as of March 31, 2015 and December 31, 2014 were $165.6 million and $177.1 million, respectively, which represents ownership of our operating partnership of 12.38% and 13.01%, respectively. The carrying value of redeemable noncontrolling interests as of March 31, 2015 and December 31, 2014 included adjustments of $115.7 million and $169.3 million, respectively, to reflect the excess of the redemption value over the accumulated historical costs. Redeemable noncontrolling interests were allocated net income of $45.3 million and and net loss of $877,000 for the three months ended March 31, 2015 and 2014, respectively. We declared aggregate cash distributions to holders of common units and holders of LTIP units of $2.7 million for each of the three months ended March 31, 2015 and 2014. These distributions are recorded as a reduction of redeemable noncontrolling interests in operating partnership.

XML

Income (Loss) Per Share

3 Months Ended

Mar. 31, 2015

Earnings Per Share [Abstract]

Income (Loss) Per Share

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):

	Three Months Ended March 31,
	2015			2014
Net income (loss) allocated to common stockholders:
Net income (loss) attributable to the Company	$	321,496		$	(2,391	)
Less: Dividends on preferred stocks	(8,490		)	(8,490		)
Less: Dividends on common stock	(11,964		)	(9,629		)
Less: Dividends on unvested restricted shares	(165		)	(84		)
Less: Undistributed income from continuing operations allocated to unvested shares	(2,035		)	—
Undistributed income (loss)	298,842			(20,594		)
Add back: Dividends on common stock	11,964			9,629
Distributed and undistributed income (loss) from continuing operations - basic	$	310,806		$	(10,965	)
Add back: Income from continuing operations allocated to operating partnership units	45,336			—
Distributed and undistributed net income (loss) - diluted	$	356,142		$	(10,965	)
Income from discontinued operations allocated to common stockholders:
Income from discontinued operations attributable to the Company	$	—		$	3
Weighted average shares outstanding:
Weighted average common shares outstanding - basic	95,539			81,690
Effect of assumed conversion of operating partnership units	18,373			—
Weighted average shares outstanding - diluted	113,912			81,690
Basic income (loss) per share:
Income (loss) from continuing operations allocated to common stockholders per share	$	3.25		$	(0.13	)
Income from discontinued operations allocated to common stockholders per share	—			—
Net income (loss) allocated to common stockholders per share	$	3.25		$	(0.13	)
Diluted income (loss) per share:
Income (loss) from continuing operations allocated to common stockholders per share	$	3.13		$	(0.13	)
Income from discontinued operations allocated to common stockholders per share	—			—
Net income (loss) allocated to common stockholders per share	$	3.13		$	(0.13	)

Due to the anti-dilutive effect, the computation of diluted income (loss) per share does not reflect adjustments for the following items (in thousands):

	Three Months Ended March 31,
	2015		2014
Net income (loss) allocated to common stockholders is not adjusted for:
Income allocated to unvested restricted shares	$	2,200	$	84
Net income (loss) attributable to noncontrolling interest in operating partnership units	—		(877		)
Total	$	2,200	$	(793	)
Weighted average diluted shares are not adjusted for:
Effect of unvested restricted shares	432		144
Effect of assumed conversion of operating partnership units	—		19,316
Total	432		19,460

XML

Investment in Unconsolidated Entities

3 Months Ended

Mar. 31, 2015

Equity Method Investments and Joint Ventures [Abstract]

Investment in Unconsolidated Entities

Investment in Unconsolidated Entities

We held a 71.74% common equity interest and a $25.0 million, or 50%, preferred equity interest earning an accrued but unpaid 15% annual return with priority over common equity distributions in PIM Highland JV, a 28-hotel portfolio venture. Although we had majority ownership in PIM Highland JV, all major decisions related to the joint venture, including establishment of policies and operating procedures with respect to business affairs and incurring obligations and expenditures, were subject to the approval of an executive committee, which was comprised of four persons with us and our partner each designating two of those persons. As a result, we utilized the equity accounting method with respect to the PIM Highland JV.

As previously discussed, pursuant to the Agreement, we agreed to purchase and PRISA III agreed to sell all of PRISA III’s right, title and interest in and to its approximately 28.26% interest in the PIM Highland JV. As of March 6, 2015, we own 100% of the PIM Highland JV. Prior to the acquisition of the remaining approximate 28.26% interest in the PIM Highland JV, we had a carrying value of $144.8 million at December 31, 2014. The acquisition-date fair value of the previous equity interest was $522.8 million and is included in the measurement of the consideration transferred. We recognized a gain of $381.8 million as a result of remeasuring our equity interest in PIM Highland JV before the business combination. See Note 3 for unaudited pro forma results of operations and Note 7 for indebtedness related to the PIM Highland JV.

The following tables summarize the consolidated balance sheet as of December 31, 2014 and the consolidated statements of operations for the period from January 1, 2015 through March 5, 2015 and the three months ended March 31, 2014 of the PIM Highland JV (in thousands):

PIM Highland JV

Condensed Consolidated Balance Sheet

	December 31, 2014
Total assets	$	1,394,806
Total liabilities	1,166,682
Members’ equity	228,124
Total liabilities and members’ equity	$	1,394,806
Our ownership interest in PIM Highland JV	$	144,784

PIM Highland JV

Condensed Consolidated Statements of Operations

	Period from January 1 to March 5,			Three Months Ended March 31,
	2015			2014
Total revenue	$	76,695		$	108,761
Total operating expenses	(69,949		)	(95,388		)
Operating income	6,746			13,373
Interest income and other	17			13
Interest expense, amortization and write-offs of deferred loan costs, discounts and premiums and exit fees	(10,212		)	(15,908		)
Other expenses	—			(44		)
Income tax expense	(1,222		)	(447		)
Net loss	$	(4,671	)	$	(3,013	)
Our equity in loss of PIM Highland JV	$	(3,836	)	$	(2,754	)

At March 31, 2015 and December 31, 2014, we held a 15.2% and 14.9%, respectively, ownership interest in Ashford Prime OP, a 10-hotel portfolio, totaling 3,707 rooms (3,472 net rooms excluding those attributable to our partners).

The following tables summarize the condensed consolidated balance sheets as of March 31, 2015 and December 31, 2014 and the condensed consolidated statements of operations for the three months ended March 31, 2015 and 2014, of Ashford Prime OP (in thousands):

Ashford Hospitality Prime Limited Partnership

Condensed Consolidated Balance Sheets

	March 31, 2015		December 31, 2014
Total assets	$	1,225,832	$	1,229,508
Total liabilities	815,555		805,510
Partners’ capital	410,277		423,998
Total liabilities and partners’ capital	$	1,225,832	$	1,229,508
Our ownership interest in Ashford Prime OP	$	54,613	$	54,907

Ashford Hospitality Prime Limited Partnership

Condensed Consolidated Statements of Operations

	Three Months Ended March 31,
	2015			2014
Total revenue	$	77,789		$	61,806
Total operating expenses	(69,530		)	(57,031		)
Operating income	8,259			4,775
Interest income	4			4
Other Income	139			—
Interest expense and amortization and write-offs of loan costs	(9,637		)	(8,989		)
Unrealized gain on investments	1,323			—
Unrealized loss on derivatives	(32		)	(15		)
Income tax expense	(481		)	(226		)
Net loss	(425		)	(4,451		)
Loss from consolidated entities attributable to noncontrolling interests	147			405
Net loss attributable to Ashford Prime OP	$	(278	)	$	(4,046	)
Our equity in loss of Ashford Prime OP	$	(45	)	$	(744	)

On February 27, 2014, we announced that our Board of Directors had approved a plan to spin-off our asset management business into a separate publicly traded company in the form of a taxable special distribution. The spin-off was completed on November 12, 2014, with a pro-rata taxable distribution of Ashford Inc.’s common stock to our common stockholders of record as of November 11, 2014. The distribution was comprised of one share of Ashford Inc. common stock for every 87 shares of our common stock held by our stockholders. In addition for each common unit of our operating partnership the holder received a common unit of the operating limited liability company subsidiary of Ashford Inc. Each holder of common units of the operating limited liability company of Ashford Inc. could exchange up to 99% of those units for shares of Ashford Inc. stock at the rate of one share of Ashford Inc. common stock for every 55 common units. The exchange occurred on November 12, 2014, simultaneously with the distribution to common stockholders. Following the spin-off, we continue to hold approximately 598,000 shares of Ashford Inc. common stock for the benefit of our common stockholders, which represents an approximate 30.1% ownership interest in Ashford Inc. at the time of the spin-off. In connection with the spin-off, we entered into a 20-year advisory agreement with Ashford Inc.

The following tables summarize the condensed balance sheets as of March 31, 2015 and December 31, 2014 and the condensed statements of operations for the three months ended March 31, 2015 and 2014 of Ashford Inc. (in thousands):

Ashford Inc.

Condensed Balance Sheets

	March 31, 2015		December 31, 2014
Total assets	$	48,801	$	49,230
Total liabilities	37,807		33,912
Redeemable noncontrolling interests in Ashford LLC	535		424
Total equity	10,459		14,894
Total liabilities and equity	$	48,801	$	49,230
Our ownership interest in Ashford Inc.	$	4,358	$	7,099

Ashford Inc.

Condensed Statements of Operations

	Three Months Ended March 31,
	2015			2014
Total revenue	$	13,118		$	2,312
Total operating expenses	(21,502		)	(11,110		)
Operating loss	(8,384		)	(8,798		)
Income tax expense	(1,454		)	(15		)
Net loss	(9,838		)	(8,813		)
Loss from consolidated entities attributable to noncontrolling interests	763			—
Net loss attributable to redeemable noncontrolling interests in Ashford LLC	21			—
Net loss attributable to Ashford Inc.	$	(9,054	)	$	(8,813	)
Our equity in loss of Ashford Inc.	$	(2,741	)	$	—

Additionally, as of March 31, 2015 and December 31, 2014, we had a 14.4% subordinated beneficial interest in a trust that holds the Four Seasons hotel property in Nevis, which had a zero carrying value.

XML

Indebtedness

3 Months Ended

Mar. 31, 2015

Debt Disclosure [Abstract]

Indebtedness

Indebtedness

Indebtedness consisted of the following (in thousands):

Indebtedness	Collateral	Maturity	Interest Rate	March 31, 2015		December 31, 2014
Mortgage loan (4)	5 hotels	November 2015	Greater of 6.40% or LIBOR (1) + 6.15%	$	—	$	211,000
Mortgage loan	10 hotels	July 2015	5.22%	—		145,278
Mortgage loan	8 hotels	December 2015	5.70%	92,203		92,772
Mortgage loan	5 hotels	February 2016	5.53%	104,692		105,164
Mortgage loan	5 hotels	February 2016	5.53%	75,207		75,546
Mortgage loan (2)(6)	5 hotels	February 2016	LIBOR (1) + 4.75%	200,000		200,000
Mortgage loan (2)	7 hotels	August 2016	LIBOR (1) + 4.35%	301,000		301,000
Mortgage loan (2)	5 hotels	August 2016	LIBOR (1) + 4.38%	62,900		62,900
Mortgage loan (2)	1 hotel	August 2016	LIBOR (1) + 4.20%	37,500		37,500
Mortgage loan (2)	8 hotels	January 2017	LIBOR (1) + 4.95%	376,800		—
Mortgage loan (5)	24 hotels	April 2017	LIBOR (1) + 4.39%	1,070,560		—
Mortgage loan (2)	1 hotel	April 2017	LIBOR (1) + 4.95%	33,300		—
Mortgage loan	5 hotels	April 2017	5.95%	111,463		111,869
Mortgage loan	5 hotels	April 2017	5.95%	100,188		100,552
Mortgage loan	5 hotels	April 2017	5.95%	152,447		153,002
Mortgage loan	7 hotels	April 2017	5.95%	121,940		122,384
Mortgage loan	1 hotel	January 2018	4.38%	99,343		—
Mortgage loan	2 hotels	January 2018	4.44%	108,646		—
Mortgage loan (3)	1 hotel	July 2019	LIBOR (1) + 3.75%	5,524		5,525
Mortgage loan	1 hotel	November 2020	6.26%	99,509		99,780
Mortgage loan	1 hotel	January 2024	5.49%	10,636		10,673
Mortgage loan	1 hotel	January 2024	5.49%	7,288		7,313
Mortgage loan	1 hotel	May 2024	4.99%	6,819		6,845
Mortgage loan	3 hotels	August 2024	5.20%	67,520		67,520
Mortgage loan	2 hotels	August 2024	4.85%	12,500		12,500
Mortgage loan	3 hotels	August 2024	4.90%	24,980		24,980
Mortgage loan	3 hotels	February 2025	4.45%	54,813		—
Mortgage loan	2 hotels	February 2025	4.45%	24,461		—
Mortgage loan	2 hotels	February 2025	4.45%	21,192		—
				3,383,431		1,954,103
Premiums				4,192		—
Total				$	3,387,623	$	1,954,103

____________________________________

⁽¹⁾ LIBOR rates were 0.176% and 0.171% at March 31, 2015 and December 31, 2014, respectively.

⁽²⁾ This mortgage loan has threeone-year extension options subject to satisfaction of certain conditions.

⁽³⁾ This mortgage loan provides for an interest rate of LIBOR + 3.75% with a 0.25% LIBOR floor for the first 18 months and is fixed at 4.0% thereafter.

⁽⁴⁾ This mortgage loan had threeone-year extension options subject to satisfaction of certain conditions. The first one-year extension period began in November 2014.

⁽⁵⁾ This mortgage loan has four one-year extension options subject to satisfaction of certain conditions.

⁽⁶⁾ This mortgage loan has a LIBOR floor of 0.20%.

On January 2, 2015, we refinanced two mortgage loans totaling $356.3 million. The refinance included our $211.0 million mortgage loan due November 2015 and the $145.3 million mortgage loan due July 2015. The new loans totaled $477.3 million in four loan pools as of March 31, 2015. The new loans include a $376.8 million mortgage loan due January 2017, a $54.8 million mortgage loan due February 2025, a $24.5 million mortgage loan due February 2025 and a $21.2 million mortgage loan due February 2025. The $376.8 million mortgage loan is interest only and provides for a floating interest rate of LIBOR + 4.95%. The stated maturity is January 2017, with three one-year extension options. The three mortgage loans totaling $100.5 million due February 2025 bear interest at a fixed rate of 4.45%. The stated maturity date for each of these loans is February 2025. The new loans continue to be secured by the same 15 hotel properties.

On March 25, 2015, we completed the financing of a $33.3 million mortgage loan, secured by the Memphis Marriott. The mortgage loan is interest only and provides for a floating interest rate of LIBOR + 4.95%. The stated maturity is April 2017, with three one-year extension options.

During the three months ended March 31, 2015, we recognized premium amortization of $127,000. The amortization of the premium is computed using a method that approximates the effective interest method, which is included in interest expense and amortization of premiums and loan costs in the consolidated statements of operations.

As previously discussed in Note 1, pursuant to the Agreement, we acquired the remaining approximate 28.26% interest in the PIM Highland JV. The transaction closed on March 6, 2015. Subsequent to the close of the transaction, $907.6 million of assumed mortgage loans due March 2015 were refinanced with a $1.07 billion non-recourse mortgage loan due April 2017. The new loan provides for an interest rate of LIBOR plus 4.39%. Additionally we assumed two mortgage loans which include a $99.3 million mortgage due January 2018 with a fixed interest rate of 4.38% and a $108.6 million mortgage loan due January 2018 with a fixed interest rate of 4.44%.

We are required to maintain certain financial ratios under various debt and derivative agreements. If we violate covenants in any debt or derivative agreement, 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. Presently, our existing financial covenants are non-recourse and primarily relate to maintaining minimum debt coverage ratios, maintaining an overall minimum net worth, maintaining a maximum loan to value ratio, and maintaining an overall minimum total assets. As of March 31, 2015, we were in compliance in all material respects with all covenants or other requirements set forth in our debt and related agreements as amended.

XML

Derivative Instruments and Hedging

3 Months Ended

Mar. 31, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging

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 as a way to potentially improve cash flows. We also use non-hedge derivatives to capitalize on the historical correlation between changes in LIBOR and RevPAR. The interest rate derivatives currently include interest rate caps. These derivatives are subject to master netting settlement arrangements. As of March 31, 2015, maturities on these instruments range from November 2015 to April 2017. To mitigate the nonperformance risk, we routinely rely on 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.

In 2015, we entered into interest rate caps with notional amounts totaling $1.5 billion and strike rates ranging from 2.50% to 3.00%. These interest rate caps had effective dates from January 2015 to March 2015, and maturity dates from January 2017 to April 2017, for a total cost of $1.3 million. These instruments were not designated as a cash flow hedges. These instruments cap the interest rates on our mortgage loans with principal balances of $1.5 billion and a maturity dates from January 2017 to April 2017.

In 2014, we entered into an interest rate cap with a notional amount and strike rate of $200.0 million and 2.25%, respectively, which had an effective date of January 2014, a maturity date of February 2016 and total cost of $216,000. The instrument was not designated as a cash flow hedge. This instrument caps the interest rate on our mortgage loan with a principal balance of $200.0 million and a maturity date of February 2016.

Credit Default Swap Derivatives—A credit default swap is a derivative contract that functions like an insurance policy against the credit risk of an entity or obligation. The seller of protection assumes the credit risk of the reference obligation from the buyer (us) of protection in exchange for annual premium payments. If a default or a loss, as defined in the credit default swap agreements, occurs on the underlying bonds, then the buyer of protection is protected against those losses. The only liability for us, the buyer, is the annual premium and any change in value of the underlying CMBX index (if the trade is terminated prior to maturity). For all CMBX trades completed to date, we were the buyer of protection. Credit default swaps are subject to master-netting settlement arrangements and credit support annexes. Assuming the underlying bonds pay off at par over their remaining average life, our total exposure for these trades was approximately $1.8 million as of March 31, 2015. Cash collateral is posted by us as well as our counterparty. We offset the fair value of the derivative and the obligation/right to return/reclaim cash collateral. The change in market value of credit default swaps is settled net through posting cash collateral or reclaiming cash collateral between us and our counterparty when the change in market value is over $250,000.

In February 2015 and August 2011, we entered into credit default swap transactions for notional amounts of $45.0 million and $100.0 million, respectively, to hedge financial and capital market risk for upfront costs of $1.6 million and $8.2 million, respectively, that was subsequently returned to us as collateral by our counterparty. The net carrying value of these credit default swaps was an asset of $503,000 and liability of $184,000 as of March 31, 2015 and December 31, 2014, respectively, which are included in “derivative assets, net” and “liabilities associated with marketable securities and other”, respectively, in the consolidated balance sheets. We recognized an unrealized loss of $0.7 million and $226,000 for the three months ended March 31, 2015 and 2014, respectively, which are included in “unrealized loss on derivatives” in the consolidated statements of operations.

Marketable Securities and Liabilities Associated with Marketable Securities and other—We invest in publicly traded equity securities and put and call options on certain publicly traded equity securities, which are considered derivatives. At March 31, 2015, we had investments in these derivatives totaling $1.2 million and liabilities of $1.0 million. At December 31, 2014, we had investments in these derivatives totaling $654,000 and liabilities of $997,000.

XML

Investment in Hotel Properties, net (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014
Property, Plant and Equipment [Abstract]
Land	$ 661,499	$ 358,514
Buildings and improvements	3,535,862	2,125,656
Furniture, fixtures, and equipment	346,744	211,777
Construction in progress	16,563	11,704
Condominium properties	12,153	12,065
Total cost	4,572,821	2,719,716
Accumulated depreciation	(618,838)	(591,105)
Investments in hotel properties, net	$ 3,953,983	$ 2,128,611

XML

Summary of Fair Value of Financial Instruments (Narrative) (Details) (USD $)	3 Months Ended
	Mar. 31, 2015	Dec. 31, 2014
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Maximum maturity term of financial assets	90 days
Notes receivable	$ 3,599,000	$ 3,553,000
Carrying value of total indebtedness of continuing operations	$ 3,400,000,000	$ 2,000,000,000
Minimum [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Notes receivable fair value variance from carrying value (as a percent)	(13.40%)	(14.20%)
Total indebtedness fair value variance from carrying value (as a percent)	96.50%	97.50%
Maximum [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Notes receivable fair value variance from carrying value (as a percent)	(4.30%)	(5.20%)
Total indebtedness fair value variance from carrying value (as a percent)	106.60%	107.80%

XML

Commitments and Contingencies

3 Months Ended

Mar. 31, 2015

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Restricted Cash—Under certain management and debt agreements for our hotel properties existing at March 31, 2015, 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 3% to 6% of gross revenues for capital improvements.

Franchise Fees—Under franchise agreements for our hotel properties existing at March 31, 2015, we pay franchisor royalty fees between 2.5% and 6% of gross room revenue and, in some cases, food and beverage revenues. Additionally, we pay fees for marketing, reservations, and other related activities aggregating between 1% and 6% of gross room revenue and, in some cases, food and beverage revenues. These franchise agreements expire on varying dates between 2015 and 2035. When a franchise term expires, the franchisor has no obligation to renew the franchise. A franchise termination could have a material adverse effect on the operations or the underlying value of the affected hotel due to loss of associated name recognition, marketing support, and centralized reservation systems provided by the franchisor. A franchise termination could also have a material adverse effect on cash available for distribution to stockholders. 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.

Our continuing operations incurred franchise fees of $11.9 million and $8.9 million for the three months ended March 31, 2015 and 2014, respectively.

Management Fees—Under management agreements for our hotel properties existing at March 31, 2015, we pay a) monthly property management fees equal to the greater of $10,000 (CPI adjusted since 2003) or 3% of gross revenues, or in some cases 1.5% to 7% of gross revenues, as well as annual incentive management fees, if applicable, b) market service fees on approved capital improvements, including project management fees of up to 4% of project costs, for certain hotels, and c) other general fees at current market rates as approved by our independent directors, if required. These management agreements expire from 2015 through 2044, with renewal options. If we terminate a 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.

Income Taxes—If we sell or transfer the Marriott Crystal Gateway in Arlington, Virginia prior to July 2016, we will be required to indemnify the entity from which we acquired the property if, as a result of such transactions, such entity would recognize a gain for federal tax purposes. In general, tax indemnities equal the federal, state, and local income tax liabilities the contributor or their specified assignee incurs with respect to the gain allocated to the contributor. The contribution agreements’ terms generally require us to gross up tax indemnity payments for the amount of income taxes due as a result of such tax indemnities.

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 Lodging, petitioned the employer to withdraw recognition of the union. As a result of the decertification petition, Remington Lodging 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 (“NLRB”) filed a complaint against Remington Lodging seeking, among other things, that Remington Lodging’s withdrawal of recognition was unlawful. Pending the final determination of the NLRB complaint, including appeals, the pension fund entered into a settlement agreement with Remington Lodging on November 1, 2011, providing that (a) Remington Lodging will continue to make monthly pension fund payments pursuant to the collective bargaining agreement, and (b) if the withdrawal of recognition is ultimately deemed lawful, Remington Lodging will have an unfunded pension liability equal to $1.7 million minus the monthly pension payments made by Remington Lodging since the settlement agreement. To illustrate, if Remington Lodging—as of the date a final determination occurs—has made monthly pension payments equaling $100,000, Remington Lodging’s remaining withdrawal liability shall be the unfunded pension liability of $1.7 million minus $100,000 (or $1.6 million). This remaining unfunded pension liability shall be paid to the pension fund in annual installments of $84,000 (but may be made monthly or quarterly, at Remington Lodging’s election), which shall continue for the remainder of the twenty-(20)-year capped period, unless Remington Lodging elects to pay the unfunded pension liability amount earlier. We agreed to indemnify Remington Lodging for the payment of the unfunded pension liability as set forth in the settlement agreement.

Litigation—Palm Beach Florida Hotel and Office Building Limited Partnership, et al. v. Nantucket Enterprises, Inc.This litigation involves a landlord tenant dispute from 2008 in which the landlord, Palm Beach Florida Hotel and Office Building Limited Partnership, a subsidiary of the Company, claimed that the tenant, Nantucket Enterprises, Inc., had violated various lease provisions of the lease agreement and was therefore in default. The tenant counterclaimed and asserted multiple claims including that it had been wrongfully evicted. The litigation was instituted by the plaintiff in November 2008 in the Circuit Court of the Fifteenth Judicial Circuit, in and for Palm Beach County, Florida and proceeded to a jury trial on June 30, 2014. The jury entered its verdict awarding the tenant total claims of $10.8 million and ruling against the landlord on its claim of breach of contract. The landlord is preparing various post trial motions. A final judgment was entered and the landlord has filed a notice of appeal. As a result of the jury verdict, we previously recorded pre-judgment interest of $707,000 and accrued a reasonable estimate of loss related to legal fees of $400,000 during 2014. For the three months ended March 31, 2015, we recorded additional pre-judgment interest of $24,000. Including the 2014 judgment, pre-judgment interest and estimated loss of legal expenses, total expense was $11.9 million through March 31, 2015. The additional charges related to pre-judgment interest are included in other expenses in the consolidated statements of operations for the three months ended March 31, 2015.

We are engaged in other various legal proceedings which have arisen but have not been fully adjudicated. The likelihood of loss from these legal proceedings, based on definitions within contingency accounting literature, ranges from remote to reasonably possible and to probable. Based on estimates of the range of potential losses associated with these matters, management does 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 or results of operations. However, the final results of legal proceedings cannot be predicted with certainty and if we fail to 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 or results of operations could be materially adversely affected in future periods.

XML

Hotel Dispositions (Tables)

3 Months Ended

Mar. 31, 2015

Discontinued Operations and Disposal Groups [Abstract]

Schedule of Disposal Groups, Income Statement

The following table includes condensed financial information from this hotel for the three months ended March 31, 2014 (in thousands):

	Three Months Ended March 31,
	2014
Hotel revenues	$	735
Hotel operating expenses	(473		)
Operating income	262
Property taxes, insurance and other	(31		)
Depreciation and amortization	(77		)
Interest expense and amortization of loan costs	(150		)
Net income	4
Income from discontinued operations attributable to redeemable noncontrolling interests in operating partnership	(1		)
Income from discontinued operations attributable to the Company	$	3

The following table includes condensed financial information from this hotel (in thousands):

	Three Months Ended March 31,
	2015			2014
Total hotel revenue	$	361		$	472
Total hotel operating expenses	(308		)	(430		)
Operating income	53			42
Property taxes, insurance and other	(40		)	(41		)
Depreciation and amortization	(164		)	(150		)
Interest expense and amortization of loan costs	—			(128		)
Loss from continuing operations	(151		)	(277		)
Loss on sale of hotel property	(1,130		)	—
Net loss	(1,281		)	(277		)
Net loss from continuing operations attributable to redeemable noncontrolling interests in operating partnership	147			36
Loss from continuing operations attributable to the Company	$	(1,134	)	$	(241	)

XML

Fair Value Measurements (Effect of Fair Value Measured Assets and Liabilities on Consolidated Statements of Operations) (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Unrealized loss on derivatives	$ (1,698)	$ (347)
Unrealized gain (loss) on marketable securities	(1,802)	1
Credit Default Swaps [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Unrealized loss on derivatives	(680)	(226)
Fair Value Measurements Recurring [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Gain or (Loss) Recognized in income, Liabilities	577	757
Unrealized loss on derivatives	(1,698)	(347)
Unrealized gain (loss) on marketable securities	(1,802)	1
Realized gain (loss) on marketable securities	4,077	1,103
Gain or (Loss) Recognized in income, Net	577	757
Reclassified from Accumulated OCI into Interest Expense, Liabilities	0	71
Reclassified from Accumulated OCI into Interest Expense, Net	0	71
Fair Value Measurements Recurring [Member] | Interest Rate Derivatives [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Unrealized loss on derivatives	(1,018)	(121)
Reclassified from Accumulated OCI into Interest Expense, Net	0	71
Fair Value Measurements Recurring [Member] | Credit Default Swaps [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Unrealized loss on derivatives	(680)	(226)
Fair Value Measurements Recurring [Member] | Derivative Liabilities [Member] | Put Option [Member] | Short [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Gain or (Loss) Recognized in income, Liabilities	595	4
Fair Value Measurements Recurring [Member] | Derivative Liabilities [Member] | Call Option [Member] | Short [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Gain or (Loss) Recognized in income, Liabilities	579	391
Fair Value Measurements Recurring [Member] | Non-Derivative Liabilities [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Gain or (Loss) Recognized in income, Liabilities	1,138	395
Reclassified from Accumulated OCI into Interest Expense, Liabilities	0	0
Fair Value Measurements Recurring [Member] | Non-Derivative Liabilities [Member] | Equity Securities [Member] | Short [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Gain or (Loss) Recognized in income, Liabilities	(36)	0
Fair Value Measurements Recurring [Member] | Derivative Assets [Member] | Interest Rate Derivatives [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Gain or (Loss) Recognized in income, Assets	(1,018)	(121)
Reclassified from Accumulated OCI into Interest Expense, Assets	0	71
Fair Value Measurements Recurring [Member] | Derivative Assets [Member] | Credit Default Swaps [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Gain or (Loss) Recognized in income, Assets	(737)	(247)
Fair Value Measurements Recurring [Member] | Derivative Assets [Member] | Put Option [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Gain or (Loss) Recognized in income, Assets	(1,290)	(462)
Fair Value Measurements Recurring [Member] | Derivative Assets [Member] | Call Option [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Gain or (Loss) Recognized in income, Assets	80	(50)
Fair Value Measurements Recurring [Member] | Non Derivative Assets [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Gain or (Loss) Recognized in income, Assets	(561)	362
Reclassified from Accumulated OCI into Interest Expense, Assets	0	71
Fair Value Measurements Recurring [Member] | Non Derivative Assets [Member] | Equity - American Depositary Receipts [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Gain or (Loss) Recognized in income, Assets	(65)	0
Fair Value Measurements Recurring [Member] | Non Derivative Assets [Member] | Equity Securities [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Gain or (Loss) Recognized in income, Assets	2,063	948
Fair Value Measurements Recurring [Member] | Non Derivative Assets [Member] | U.S. Treasury Securities [Member]
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items]
Gain or (Loss) Recognized in income, Assets	$ 406	$ 294

XML

Investment in Unconsolidated Entities (Summary of Balance Sheet) (Details) (USD $) In Thousands, unless otherwise specified	Mar. 31, 2015	Dec. 31, 2014	Mar. 06, 2015
Real Estate Properties [Line Items]
Total assets	$ 4,768,956	$ 2,781,080
Total liabilities	3,605,300	2,071,583
Redeemable noncontrolling interests in operating partnership	165,590	177,064
Total equity	997,291	531,633
Total liabilities and equity	4,768,956	2,781,080
Investment in unconsolidated entities	58,971	206,790
Ashford Inc. [Member]
Real Estate Properties [Line Items]
Total assets	48,801	49,230
Total liabilities	37,807	33,912
Redeemable noncontrolling interests in operating partnership	535	424
Total equity	10,459	14,894
Total liabilities and equity	48,801	49,230
Investment in unconsolidated entities	4,358	7,099
PIM Highland JV [Member]
Real Estate Properties [Line Items]
Total assets		1,394,806
Total liabilities		1,166,682
Partners' capital		228,124
Total liabilities and equity		1,394,806
Investment in unconsolidated entities		144,784	522,800
Ashford Prime OP [Member]
Real Estate Properties [Line Items]
Total assets	1,225,832	1,229,508
Total liabilities	815,555	805,510
Partners' capital	410,277	423,998
Total liabilities and equity	1,225,832	1,229,508
Investment in unconsolidated entities	$ 54,613	$ 54,907

XML

Consolidated Statements of Comprehensive Income (Loss) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ 366,807	$ (3,292)
Other comprehensive income, net of tax:
Reclassification to interest expense	0	71
Total other comprehensive income	0	71
Comprehensive income (loss)	366,807	(3,221)
Less: Comprehensive loss attributable to noncontrolling interest in consolidated entities	25	27
Less: Comprehensive (income) loss attributable to redeemable noncontrolling interests in operating partnership	(45,336)	868
Comprehensive income (loss) attributable to the Company	$ 321,496	$ (2,326)

XML

Investment in Hotel Properties, net

3 Months Ended

Mar. 31, 2015

Property, Plant and Equipment [Abstract]

Investments in Hotel Properties, net

Investments in Hotel Properties, net

Investments in hotel properties, net consisted of the following (in thousands):

	March 31, 2015			December 31, 2014
Land	$	661,499		$	358,514
Buildings and improvements	3,535,862			2,125,656
Furniture, fixtures, and equipment	346,744			211,777
Construction in progress	16,563			11,704
Condominium properties	12,153			12,065
Total cost	4,572,821			2,719,716
Accumulated depreciation	(618,838		)	(591,105		)
Investments in hotel properties, net	$	3,953,983		$	2,128,611

Acquisitions

On February 6, 2015, we acquired a 100% interest in the Lakeway Resort & Spa (“Lakeway Resort”) in Austin, Texas, for total consideration of $33.5 million. The acquisition was funded with cash. We have allocated the assets acquired and liabilities assumed on a preliminary basis using the estimated fair value information currently available. This valuation is considered a Level 3 valuation technique. We are in the process of obtaining necessary information and evaluating the values assigned to investment in hotel properties and property level working capital balances. Thus, the balances reflected below are subject to change and could result in adjustments. Any change to the amounts recorded within the investments in hotel properties will also impact depreciation and amortization expense.

The following table summarizes the preliminary fair value of the assets acquired and liabilities assumed in the acquisition (in thousands):

Land	$	4,541
Buildings and improvements	24,703
Furniture, fixtures, and equipment	4,237
	33,481
Net other assets and liabilities	(382		)

The results of operations of the hotel property have been included in our results of operations since February 6, 2015. For the three months ended March 31, 2015, we have included total revenue of $1.8 million and net loss of $58,000 in our consolidated statements of operations.

On February 25, 2015, we acquired a 100% interest in the Memphis Marriott East (“Memphis Marriott”) hotel in Memphis, Tennessee for total consideration of $43.5 million. The acquisition was funded with cash. We have allocated the assets acquired and liabilities assumed on a preliminary basis using the estimated fair value information currently available. This valuation is considered a Level 3 valuation technique. We are in the process of obtaining necessary information and evaluating the values assigned to investment in hotel properties and property level working capital balances. Thus, the balances reflected below are subject to change and could result in adjustments. Any change to the amounts recorded within the investments in hotel properties will also impact depreciation and amortization expense.

The following table summarizes the preliminary fair value of the assets acquired and liabilities assumed in the acquisition (in thousands):

Land	$	6,210
Buildings and improvements	32,934
Furniture, fixtures, and equipment	4,350
	43,494
Net other assets and liabilities	34

The results of operations of the hotel property have been included in our results of operations since February 25, 2015. For the three months ended March 31, 2015, we have included total revenue of $1.2 million and net income of $152,000 in our consolidated statements of operations.

On March 25, 2015, we completed the financing of a $33.3 million mortgage loan, secured by the Memphis Marriott. See Note 7.

As previously discussed in Note 1, we acquired the remaining approximate 28.26% interest in the PIM Highland JV. The transaction closed on March 6, 2015, for consideration of $250.1 million in cash. We recognized a gain of $381.8 million. Subsequent to the close of the transaction, $907.6 million of existing debt of the PIM Highland JV was refinanced. See Note 7. We have allocated the assets acquired and liabilities assumed on a preliminary basis using the estimated fair value information currently available. This valuation is considered a Level 3 valuation technique. We are in the process of obtaining necessary information and evaluating the values assigned to investment in hotel properties and property level working capital balances. We are also in the process of evaluating the fair value of intangibles associated with above and below market leases which could impact rent expense. Thus, the balances reflected below are subject to change and could result in adjustments. Any change to the amounts recorded within the investments in hotel properties will also impact depreciation and amortization expense.

The following table summarizes the preliminary fair value of the assets acquired and liabilities assumed in the acquisition (in thousands):

Land	$	292,934
Buildings and improvements	1,351,293
Furniture, fixtures, and equipment	118,878
	1,763,105
Indebtedness	(1,120,082		)
Net other assets and liabilities	105,814

The results of operations of the hotel properties have been included in our results of operations since March 6, 2015. For the three months ended March 31, 2015, we have included total revenue of $37.6 million and net income of $434,000 in our consolidated statements of operations.

Subsequent to March 31, 2015, on April 29, 2015, we completed the acquisition of the Hampton Inn & Suites in Gainesville, Florida for total consideration of $25.3 million in cash.

The following table reflects the unaudited pro forma results of operations as if all acquisitions had occurred and the applicable indebtedness was incurred on January 1, 2014 and the removal of $495,000 of non-recurring transaction costs and gain on acquisition of the PIM Highland JV of $381.8 million. The table also reflects the removal of equity in loss in unconsolidated entity of $3.8 million and $2.8 million for the three month ended March 31, 2015 and 2014, respectively. These adjustments are directly attributable to the transactions for the three months ended March 31, 2015 (in thousands):

	Three Months Ended March 31,
	2015			2014
Total revenue	$	330,830		$	310,103
Net loss	(23,129		)	(11,466		)

XML

Investment in Unconsolidated Entities (Tables)

3 Months Ended

Mar. 31, 2015

Equity Method Investments and Joint Ventures [Abstract]

Summary of Preliminary Balance Sheet

The following tables summarize the condensed consolidated balance sheets as of March 31, 2015 and December 31, 2014 and the condensed consolidated statements of operations for the three months ended March 31, 2015 and 2014, of Ashford Prime OP (in thousands):

Ashford Hospitality Prime Limited Partnership

Condensed Consolidated Balance Sheets

	March 31, 2015		December 31, 2014
Total assets	$	1,225,832	$	1,229,508
Total liabilities	815,555		805,510
Partners’ capital	410,277		423,998
Total liabilities and partners’ capital	$	1,225,832	$	1,229,508
Our ownership interest in Ashford Prime OP	$	54,613	$	54,907

The following tables summarize the condensed balance sheets as of March 31, 2015 and December 31, 2014 and the condensed statements of operations for the three months ended March 31, 2015 and 2014 of Ashford Inc. (in thousands):

Ashford Inc.

Condensed Balance Sheets

	March 31, 2015		December 31, 2014
Total assets	$	48,801	$	49,230
Total liabilities	37,807		33,912
Redeemable noncontrolling interests in Ashford LLC	535		424
Total equity	10,459		14,894
Total liabilities and equity	$	48,801	$	49,230
Our ownership interest in Ashford Inc.	$	4,358	$	7,099

The following tables summarize the consolidated balance sheet as of December 31, 2014 and the consolidated statements of operations for the period from January 1, 2015 through March 5, 2015 and the three months ended March 31, 2014 of the PIM Highland JV (in thousands):

PIM Highland JV

Condensed Consolidated Balance Sheet

	December 31, 2014
Total assets	$	1,394,806
Total liabilities	1,166,682
Members’ equity	228,124
Total liabilities and members’ equity	$	1,394,806
Our ownership interest in PIM Highland JV	$	144,784

Summary of Preliminary Statement of Operations

	Period from January 1 to March 5,			Three Months Ended March 31,
	2015			2014
Total revenue	$	76,695		$	108,761
Total operating expenses	(69,949		)	(95,388		)
Operating income	6,746			13,373
Interest income and other	17			13
Interest expense, amortization and write-offs of deferred loan costs, discounts and premiums and exit fees	(10,212		)	(15,908		)
Other expenses	—			(44		)
Income tax expense	(1,222		)	(447		)
Net loss	$	(4,671	)	$	(3,013	)
Our equity in loss of PIM Highland JV	$	(3,836	)	$	(2,754	)

Ashford Inc.

Condensed Statements of Operations

	Three Months Ended March 31,
	2015			2014
Total revenue	$	13,118		$	2,312
Total operating expenses	(21,502		)	(11,110		)
Operating loss	(8,384		)	(8,798		)
Income tax expense	(1,454		)	(15		)
Net loss	(9,838		)	(8,813		)
Loss from consolidated entities attributable to noncontrolling interests	763			—
Net loss attributable to redeemable noncontrolling interests in Ashford LLC	21			—
Net loss attributable to Ashford Inc.	$	(9,054	)	$	(8,813	)
Our equity in loss of Ashford Inc.	$	(2,741	)	$	—

Ashford Hospitality Prime Limited Partnership

Condensed Consolidated Statements of Operations

	Three Months Ended March 31,
	2015			2014
Total revenue	$	77,789		$	61,806
Total operating expenses	(69,530		)	(57,031		)
Operating income	8,259			4,775
Interest income	4			4
Other Income	139			—
Interest expense and amortization and write-offs of loan costs	(9,637		)	(8,989		)
Unrealized gain on investments	1,323			—
Unrealized loss on derivatives	(32		)	(15		)
Income tax expense	(481		)	(226		)
Net loss	(425		)	(4,451		)
Loss from consolidated entities attributable to noncontrolling interests	147			405
Net loss attributable to Ashford Prime OP	$	(278	)	$	(4,046	)
Our equity in loss of Ashford Prime OP	$	(45	)	$	(744	)

XML

Hotel Dispositions (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended
	Mar. 31, 2015	Mar. 31, 2014
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Total hotel revenue	$ 249,375	$ 191,602
Total hotel expenses	(153,872)	(120,093)
Operating income	32,105	26,393
Property taxes, insurance and other	(11,594)	(9,589)
Depreciation and Amortization	(37,864)	(26,152)
Interest expense and amortization of loan costs	(34,635)	(28,375)
Income (loss) from continuing operations	367,937	(6,787)
Loss on sale of hotel property	(1,130)	3,491
Net income (loss)	366,807	(3,292)
Net loss from continuing operations attributable to redeemable noncontrolling interests in operating partnership	(45,336)	877
Net income (loss) attributable to the Company	321,496	(2,388)
Income from discontinued operations attributable to the Company	0	3
Hampton Terre Haute
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Total hotel revenue	361	472
Total hotel expenses	(308)	(430)
Operating income	53	42
Property taxes, insurance and other	(40)	(41)
Depreciation and Amortization	(164)	(150)
Interest expense and amortization of loan costs	0	(128)
Income (loss) from continuing operations	(151)	(277)
Loss on sale of hotel property	(1,130)	0
Net income (loss)	(1,281)	(277)
Net loss from continuing operations attributable to redeemable noncontrolling interests in operating partnership	147	36
Net income (loss) attributable to the Company	(1,134)	(241)
Mobile Homewood
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Total hotel revenue		735
Total hotel expenses		(473)
Operating income		262
Property taxes, insurance and other		(31)
Depreciation and Amortization		(77)
Interest expense and amortization of loan costs		(150)
Net income (loss)		4
Income from discontinued operations attributable to redeemable noncontrolling interests in operating partnership		(1)
Income from discontinued operations attributable to the Company		$ 3

XML

Equity and Equity-Based Compensation

3 Months Ended

Mar. 31, 2015

Equity [Abstract]

Equity and Equity-Based Compensation

Equity and Equity-Based Compensation

Equity Offering—On January 29, 2015, we commenced a follow-on public offering of 9.5 million shares of common stock. The offering priced on January 30, 2015, at $10.65 per share for gross proceeds of $101.2 million. We granted the underwriters a 30-day option to purchase up to an additional 1.425 million shares of common stock. On February 10, 2015, the underwriters partially exercised their option and purchased an additional 1.029 million shares of our common stock at a price of $10.65 per share less the underwriting discount.

Common Stock Dividends—For each of the 2015 and 2014 quarters, the Board of Directors declared quarterly dividends of $0.12 per outstanding share of common stock with an annualized target of $0.48 per share for 2015.

Equity-Based Compensation—Stock-based compensation expense for the three months ended March 31, 2015, was $107,000, which is associated with restricted shares of our common stock issued to Ashford LLC’s employees and is included in “advisory services fee” in our consolidated statements of operations. We recognized compensation expense related to restricted shares of our common stock of $617,000 for the three months ended March 31, 2014, while we were self-advised. The fair value of the unamortized restricted shares, which was $9.6 million at March 31, 2015, will be amortized over a period of 3.0 years.

Preferred Dividends—During the three months ended March 31, 2015, the Board of Directors declared quarterly dividends of $0.5344 per share for our 8.55% Series A preferred stock, $0.5281 per share for our 8.45% Series D preferred stock, and $0.5625 per share for our 9.00% Series E preferred stock. During the three months ended March 31, 2014, the Board of Directors declared quarterly dividends of $0.5344 per share for our 8.55% Series A preferred stock, $0.5281 per share for our 8.45% Series D preferred stock and $0.5625 per share for our 9.00% Series E preferred stock.

Noncontrolling Interests in Consolidated Entities—Our noncontrolling entity partner, had an ownership interest of 15% in two hotel properties and a total carrying value of $775,000 and $800,000 at March 31, 2015 and December 31, 2014, respectively. Our ownership interest is reported in equity in the consolidated balance sheets. Noncontrolling interests in consolidated entities were allocated losses of $25,000 and $27,000 for the three months ended March 31, 2015 and 2014, respectively.