Ashford Hospitality Trust : Annual Report for Fiscal Year Ending December 31, 2025 (Form 10-K)

About this update from Ashford Hospitality Trust Inc

Management's Discussion and Analysis of Financial Condition and Results of Operations This section of this Form 10-K generally discusses 2025 and 2024 items and year-to-year comparisons between 2025 and 2024. Discussions of 2024 items and year-to-year comparisons between 2024 and 2023 that are not included in this Form 10-K can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Company's Annual Report on Form 10-K for the year ended December 31, 2024. EXECUTIVE OVERVIEW General As of December 31, 2025, our portfolio consisted of 67 consolidated operating hotel properties, which represent 16,445 total rooms, and one additional consolidated operating hotel property owned through a 29.3% investment in a consolidated entity, which represents 188 total rooms. Currently, all of our hotel properties are located in the United States. Based on our primary business objectives and forecasted operating conditions, our current key priorities and financial strategies include, among other things: • preserving capital and maintaining significant cash and cash equivalents liquidity; • disposition of non-core hotel properties; • acquisition of hotel properties, in whole or in part, that we expect will be accretive to our portfolio; • pursuing capital market activities and implementing strategies to enhance long-term stockholder value; • accessing cost effective capital, including through the issuance of non-traded preferred securities; • opportunistically exchanging preferred stock into common stock; • implementing selective capital improvements designed to increase profitability and maintain the quality of our assets; • implementing effective asset management strategies to minimize operating costs and increase revenues; • financing or refinancing hotels on competitive terms; • modifying or extending property-level indebtedness; • utilizing hedges, derivatives and other strategies to mitigate risks; • pursuing opportunistic value-add additions to our hotel portfolio; and • making other investments or divestitures that our board of directors deems appropriate. Our current investment strategy is to focus on owning predominantly full-service hotels in the upper upscale segment in domestic markets that have RevPAR generally less than twice the national average. We believe that as supply, demand and capital market cycles change, we will be able to shift our investment strategy to take advantage of new lodging-related investment opportunities as they may develop. Our board of directors may change our investment strategy at any time without stockholder approval or notice. We will continue to seek ways to benefit from the cyclical nature of the hotel industry. Recent Developments On October 15, 2025, the Company completed the sale of the 150-room Residence Inn San Diego Sorrento Mesa located in San Diego, California, for $42.0 million, subject to customary pro rations and adjustments. On November 10, 2025, Ashford Trust OP executed an Amended and Restated Master Line of Credit Promissory Note (the "Amended and Restated Promissory Note") with Ashford Hospitality Advisors LLC ("Ashford LLC"), a subsidiary of Ashford Inc., amending the original Master Line of Credit Promissory note, dated August 14, 2025, allowing Ashford Trust OP to draw up to $40 million in cash through November 15, 2026 to fund Permitted Costs (as defined in the Promissory Note). Funds advanced under the Amended and Restated Promissory Note bear interest at an annual rate of 10.0% which may be paid in cash or paid in-kind at Ashford OP's discretion. The maturity date of the Amended and Restated Promissory Note is November 15, 2026, at which time all principal drawn upon and outstanding interest are due and payable. As collateral to secure the repayment of any amounts advanced by Ashford LLC under the Amended and Restated Promissory Note, the Company pledged to Ashford LLC the Company's equity in Ashford Trust OP subject to Ashford LLC's filing of a financing statement in the appropriate jurisdiction. On November 10, 2025, the Company and Ashford LLC entered into Amendment No. 6 to the Advisory Agreement (the "Sixth Amendment"). The Sixth Amendment further extends the outside date for which any sale or disposition of any of the Company's Highland Portfolio and JPM8 hotel properties securing the associated mortgage loans following an event of default (as defined in the Advisory Agreement) would be excluded from the numerator of the calculation of the percentage of gross book value of the Company's assets sold or disposed (but, for the avoidance of doubt, included in the denominator of such calculation) for purposes of determining whether a Company Change of Control (as defined in the Advisory Agreement) has occurred, from August 15, 2026 to November 15, 2026. On November 11, 2025, the Company entered into a definitive agreement to sell the 150-room Embassy Suites Houston located in Houston, Texas, and the 150-room Embassy Suites Austin located in Austin, Texas, for a combined purchase price of $27.0 million. The agreement included a nonrefundable deposit of $1.0 million which was paid on November 11, 2025. On December 9, 2025, the Company's external advisor, Ashford Hospitality Advisors LLC, entered into an employment agreement with Stephen Zsigray, and the Company, along with Ashford Inc., entered into a related retention letter agreement. Under the retention arrangement, the Company agreed to provide Mr. Zsigray with monthly retention payments from April 2026 through March 2029, subject to the conditions specified in the agreement. In connection with these arrangements, the Company also executed a Limited Waiver under the Advisory Agreement to permit the Company to enter into and fund these obligations, including the reimbursement of certain severance- or non-compete-related payments, under specified circumstances. On December 9, 2025, the Company terminated the primary offering of the Company's Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock. The Company continued to offer shares of its Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock pursuant to its dividend reinvestment plan beyond the termination of the primary offering. On December 9, 2025, the Board suspended all redemptions of the Company's Series J, Series K, Series L, and Series M Redeemable Preferred Stock. On December 9, 2025, the Company issued a press release announcing that the Board had formed a special committee composed of independent and disinterested directors. The Special Committee is authorized to evaluate strategic alternatives aimed at creating and enhancing stockholder value. On December 15, 2025, the Company declared a dividend of one Right for each outstanding share of common stock, each Right initially representing the right to purchase from the Company one one-thousandth of a share of Series N Preferred Stock at a price of $20.00 per one one-thousandth of a share of Series N Preferred Stock, subject to adjustment as provided in the Rights Agreement. Rights were issued in respect of all outstanding shares of common stock on December 26, 2025, the Record Date, and will be issued for all shares of common stock issued after the Record Date and, subject to the terms described in the Rights Agreement, prior to the earliest of the Distribution Date, the redemption of the Rights or the expiration of the Rights as provided by the Rights Agreement. The Rights Agreement is designed to prevent the Company from facing a substantial limitation on its ability to use its Tax Benefits (as such term is defined in the Rights Agreement) to offset potential future income taxes for federal income tax purposes and realize other efficiencies. Prior to exercise, a Right does not give its holder any rights as a stockholder of the Company, including without limitation, any dividend, voting or liquidation rights. Subject to certain exceptions specified in the Rights Agreement, the Rights will separate from the common stock and become exercisable at 5:00 p.m. New York City time on the next business day following the Distribution Date. Pursuant to the terms of the Rights Agreement, the Rights will expire on the earliest of (i) 5:00 p.m. New York City time on December 14, 2026, (ii) the effective date of the repeal of Section 382 of the Code or any successor statute if the Board determines in its sole discretion that the Rights Agreement is no longer necessary or desirable for the preservation of Tax Benefits, or (iii) the first day of a taxable year of the Company to which the Board determines in its sole discretion that no Tax Benefits may be carried forward, unless the Rights are earlier redeemed or exchanged by the Company, in each case as described below, or upon the occurrence of certain transactions. On December 18, 2025, the Company completed the sale of the 226-room Le Pavillon hotel located in New Orleans, Louisiana for $42.5 million, subject to customary pro rations and adjustments. On December 23, 2025, Ashford Inc. and Ashford Hospitality Advisors LLC delivered written notice to the Company of the Advisor's election to extend the term of the Advisory Agreement for an additional ten-year term, commencing on January 14, 2031 and expiring on January 14, 2041. All terms, conditions, rights and obligations under the Advisory Agreement will remain in full force and effect during the extended term, subject to Section 6.5 of the Advisory Agreement that provides the parties to the Advisory Agreement the right to renegotiate the amount of the Base Fee or Incentive Fee (as such terms are defined in the Advisory Agreement) payable by the Company. On January 13, 2026, the Company extended its Highland mortgage loan secured by 18 hotels. As a condition to the extension, the loan was paid down by $10 million to a current balance of $723.6 million, or approximately 65% of appraised value, and has a final maturity date of July 9, 2026. On January 13, 2026, the Company announced that, to preserve the Company's liquidity position as it evaluates strategic alternatives, preferred dividends have been suspended, including dividends previously declared for recordholders of the Company's Series D, F, G, H, I, J, K, L and M preferred stock as of December 31, 2025, and payable on January 15, 2026. We intend to pay the previously declared but unpaid dividends as soon as reasonably practicable. Any accrued but unpaid dividends will accrue in accordance with the terms outlined in the applicable governing documents for each series of preferred stock. We will continue to evaluate potential future dividends on a quarterly basis. On February 9, 2026 and February 17, 2026, the Company completed the sales of the 150-room Embassy Suites Houston located in Houston, Texas, and the 150-room Embassy Suites Austin located in Austin, Texas, for a combined $27.0 million, subject to customary pro rations and adjustments. On February 11, 2026, the Company received a notice of default and acceleration from the lender relating to the Company's mortgage loan on the JPM8 hotel properties. The notice followed the Company's failure on February 9, 2026 to make certain required payments and deliver required documentation under the existing loan extension, which constituted an event of default under the loan agreement. As a result, the lender demanded immediate payment of the outstanding principal balance of $325 million, plus accrued interest, default interest, fees, and other amounts due, and also required delivery of a replacement interest rate cap agreement. The loan is secured by eight hotel properties. The notice does not trigger any cross-defaults under other loans of the Company's subsidiaries, and the Company has no indebtedness at the parent-company level. On December 12, 2025, the Company entered into a definitive agreement to sell the 333-room Hilton St. Petersburg Bayfront located in St. Petersburg, Florida for a purchase price of $96 million. The agreement included nonrefundable deposits totaling $2.4 million which were paid in February 2026. The sale was completed on March 5, 2026. On February 24, 2026, the Company entered into a definitive agreement to sell the 157-room La Posada de Santa Fe located in Santa Fe, New Mexico for a purchase price of $57.5 million. The agreement included a nonrefundable deposit of $4.0 million which was paid on February 24, 2026. The sale was completed on March 17, 2026. Effective February 24, 2026, Sonny Sra retired from the Company's board of directors due to health reasons. On February 25, 2026, the Company entered into definitive agreements to sell the 252-room Hilton Alexandria Old Town located in Alexandria, Virginia and the 160-room Embassy Suites Palm Beach Gardens located in Palm Beach, Florida for purchase prices of $58.0 million and $41.0 million, respectively. The agreements included nonrefundable deposits of $3.0 million and $2.1 million, respectively, which were paid in February of 2026. On March 5, 2026, Ashford Inc. and Ashford LLC agreed with Deric Eubanks, the Chief Financial Officer of Ashford Inc., and Ashford LLC that, effective March 31, 2026 (the "Termination Date"), Mr. Eubanks would terminate employment with and service to Ashford Inc., Ashford LLC and their affiliates. Mr. Eubanks is also the Chief Financial Officer of the Company and Braemar and accordingly his service as Chief Financial Officer of each of the Company and Braemar will also end effective as of the Termination Date. Effective on the Termination Date, Justin Coe, the Company's current Chief Accounting Officer and principal accounting officer, will serve as the principal financial officer of the Company. On March 13, 2026, we entered into a Limited Waiver Under Advisory Agreement with Ashford Inc. and Ashford LLC (the "2026 Advisory Agreement Limited Waiver"). Pursuant to the 2026 Advisory Agreement Limited Waiver, the Company, the Operating Partnership, TRS, Ashford Inc. and Ashford LLC waive the operation of any provision in our advisory agreement that would otherwise limit the ability of the Company in its discretion, at the Company's cost and expense, to award during calendar year 2026, cash incentive compensation to employees and other representatives of Ashford Inc. and Ashford LLC. On March 16, 2026, the Company entered into a definitive agreement to sell the 168-room Lakeway Resort & Spa located in Austin, Texas for a purchase price of $37.8 million. The agreement included a nonrefundable deposit of $500,000 which was paid on March 16, 2026. RESULTS OF OPERATIONS Key Indicators of Operating Performance We use a variety of operating and other information to evaluate the operating performance of our business. These key indicators include financial information that is prepared in accordance with GAAP as well as other financial measures that are non-GAAP measures. In addition, we use other information that may not be financial in nature, including statistical information and comparative data. We use this information to measure the operating performance of our individual hotels, groups of hotels and/or business as a whole. We also use these metrics to evaluate the hotels in our portfolio and potential acquisitions to determine each hotel's contribution to cash flow and its potential to provide attractive long-term total returns. These key indicators include: • Occupancy -Occupancy means the total number of hotel rooms sold in a given period divided by the total number of rooms available. Occupancy measures the utilization of our hotels' available capacity. We use occupancy to measure demand at a specific hotel or group of hotels in a given period. • ADR -ADR means average daily rate and is calculated by dividing total hotel rooms revenues by total number of rooms sold in a given period. ADR measures average room price attained by a hotel and ADR trends provide useful information concerning the pricing environment and the nature of the customer base of a hotel or group of hotels. We use ADR to assess the pricing levels that we are able to generate. • RevPAR -RevPAR means revenue per available room and is calculated by multiplying ADR by the average daily occupancy. RevPAR is one of the commonly used measures within the hotel industry to evaluate hotel operations. RevPAR does not include revenues from food and beverage sales or parking, telephone or other non-rooms revenues generated by the property. Although RevPAR does not include these ancillary revenues, it is generally considered the leading indicator of core revenues for many hotels. We also use RevPAR to compare the results of our hotels between periods and to analyze results of our comparable hotels (comparable hotels represent hotels we have owned for the entire period). RevPAR improvements attributable to increases in occupancy are generally accompanied by increases in most categories of variable operating costs. RevPAR improvements attributable to increases in ADR are generally accompanied by increases in limited categories of operating costs, such as management fees and franchise fees. RevPAR changes that are primarily driven by changes in occupancy have different implications for overall revenues and profitability than changes that are driven primarily by changes in ADR. For example, an increase in occupancy at a hotel would lead to additional variable operating costs (including housekeeping services, utilities and room supplies) and could also result in increases in other operating department revenues and expenses. Changes in ADR typically have a greater impact on operating margins and profitability as they do not have a substantial effect on variable operating costs. Occupancy, ADR and RevPAR are commonly used measures within the lodging industry to evaluate operating performance. RevPAR is an important statistic for monitoring operating performance at the individual hotel level and across our entire business. We evaluate individual hotel RevPAR performance on an absolute basis with comparisons to budget and prior periods, as well as on a regional and company-wide basis. ADR and RevPAR include only rooms revenue. Rooms revenue is dictated by demand (as measured by occupancy), pricing (as measured by ADR) and our available supply of hotel rooms. We also use funds from operations ("FFO"), Adjusted FFO, earnings before interest, taxes, depreciation and amortization for real estate ("EBITDAre") and Adjusted EBITDAre as measures of the operating performance of our business. See "Non-GAAP Financial Measures." Principal Factors Affecting Our Results of Operations The principal factors affecting our operating results include overall demand for hotel rooms compared to the supply of available hotel rooms, and the ability of our third-party management companies to increase or maintain revenues while controlling expenses. Demand -The demand for lodging, including business travel, is directly correlated to the overall economy; as GDP increases, lodging demand typically increases. Historically, periods of declining demand are followed by extended periods of relatively strong demand, which typically occurs during the growth phase of the lodging cycle. Supply -The development of new hotels is driven largely by construction costs, the availability of financing and expected performance of existing hotels. Short-term supply is also expected to be below long-term averages. While the industry is expected to have supply growth below historical averages, we may experience supply growth, in certain markets, in excess of national averages that may negatively impact performance. We expect that our ADR, occupancy and RevPAR performance will be impacted by macroeconomic factors such as national and local employment growth, personal income and corporate earnings, GDP, consumer confidence, office vacancy rates and business relocation decisions, airport and other business and leisure travel, new hotel construction, the pricing strategies of competitors and currency fluctuations. In addition, our ADR, occupancy and RevPAR performance are dependent on the continued success of the Marriott, Hilton and Hyatt brands. Revenue -Substantially all of our revenue is derived from the operation of hotels. Specifically, our revenue is comprised of: • Rooms revenue: Occupancy and ADR are the major drivers of rooms revenue. Rooms revenue accounts for the substantial majority of our total revenue. • Food and beverage revenue: Occupancy and the type of customer staying at the hotel are the major drivers of food and beverage revenue (i.e., group business typically generates more food and beverage business through catering functions when compared to transient business, which may or may not utilize the hotel's food and beverage outlets or meeting and banquet facilities). • Other hotel revenue: Occupancy and the nature of the property are the main drivers of other ancillary revenue, such as telecommunications, parking and leasing services. Hotel Operating Expenses -The following presents the components of our hotel operating expenses: • Rooms expense: These costs include housekeeping wages and payroll taxes, reservation systems, room supplies, laundry services and front desk costs. Like rooms revenue, occupancy is the major driver of rooms expense and, therefore, rooms expense has a significant correlation to rooms revenue. These costs can increase based on increases in salaries and wages, as well as the level of service and amenities that are provided. • Food and beverage expense: These expenses primarily include food, beverage and labor costs. Occupancy and the type of customer staying at the hotel (i.e., catered functions generally are more profitable than restaurant, bar or other on-property food and beverage outlets) are the major drivers of food and beverage expense, which correlates closely with food and beverage revenue. • Management fees: Base management fees are computed as a percentage of gross revenue. Incentive management fees generally are paid when operating profits exceed certain threshold levels. • Other hotel expenses: These expenses include labor and other costs associated with the other operating department revenues, as well as labor and other costs associated with administrative departments, franchise fees, sales and marketing, repairs and maintenance and utility costs. Most categories of variable operating expenses, including labor costs such as housekeeping, fluctuate with changes in occupancy. Increases in occupancy are accompanied by increases in most categories of variable operating expenses, while increases in ADR typically only result in increases in limited categories of operating costs and expenses, such as franchise fees, management fees and credit card processing fee expenses which are based on hotel revenues. Thus, changes in ADR have a more significant impact on operating margins than changes in occupancy. The following table summarizes the changes in key line items from our consolidated statements of operations for the years ended December 31, 2025 and 2024 (in thousands): Year Ended December 31, Favorable (Unfavorable) Change 2025 2024 2023 2025 to 2024 2024 to 2023 Total revenue $ 1,104,388 $ 1,172,459 $ 1,367,533 $ (68,071) $ (195,074) Total hotel expenses (768,268) (815,356) (925,437) 47,088 110,081 Property taxes, insurance and other (59,793) (64,103) (70,226) 4,310 6,123 Depreciation and amortization (141,295) (152,776) (187,807) 11,481 35,031 Impairment charges (67,648) (59,331) - (8,317) (59,331) Advisory service fee (49,039) (58,606) (48,927) 9,567 (9,679) Corporate, general and administrative (20,783) (24,662) (16,181) 3,879 (8,481) Gain (loss) on consolidation of VIE and disposition of assets and hotel properties 79,799 94,406 11,488 (14,607) 82,918 Gain (loss) on derecognition of assets 39,054 167,177 - (128,123) 167,177 Operating income (loss) 116,415 259,208 130,443 (142,793) 128,765 Equity in earnings (loss) of unconsolidated entities (325) (2,370) (1,134) 2,045 (1,236) Interest income 4,739 6,942 8,978 (2,203) (2,036) Other income (expense) - 108 310 (108) (202) Interest expense and amortization of discounts and loan costs (256,229) (273,359) (326,970) 17,130 53,611 Interest expense associated with hotels in receivership (39,038) (45,592) (39,178) 6,554 (6,414) Write-off of premiums, loan costs and exit fees (8,853) (5,245) (3,469) (3,608) (1,776) Gain (loss) on extinguishment of debt 335 2,774 53,386 (2,439) (50,612) Realized and unrealized gain (loss) on derivatives (5,346) (6,480) (2,200) 1,134 (4,280) Income tax benefit (expense) 143 (997) (900) 1,140 (97) Net income (loss) (188,159) (65,011) (180,734) (123,148) 115,723 (Income) loss from consolidated entities attributable to noncontrolling interests 5,058 4,028 6 1,030 4,022 Net (income) loss attributable to redeemable noncontrolling interests in operating partnership 3,262 683 2,239 2,579 (1,556) Net income (loss) attributable to the Company $ (179,839) $ (60,300) $ (178,489) $ (119,539) $ 118,189 All hotel properties held during the years ended December 31, 2025 and 2024 have been included in our results of operations during the respective periods in which they were held. Based on when a hotel property was acquired or disposed, operating results for certain hotel properties are not comparable for the years ended December 31, 2025 and 2024. The hotel properties listed below are not comparable hotel properties for the periods indicated and all other hotel properties are considered comparable hotel properties. The following transactions affect the reporting comparability of our consolidated financial statements: Hotel Properties Location Type Date Courtyard Columbus Tipton Lakes (2) Columbus, IN Derecognized March 1, 2024 Courtyard Old Town (2) Scottsdale, AZ Derecognized March 1, 2024 Residence Inn Hughes Center (2) Las Vegas, NV Derecognized March 1, 2024 Residence Inn Phoenix Airport (2) Phoenix, AZ Derecognized March 1, 2024 Residence Inn San Jose Newark (2) Newark, CA Derecognized March 1, 2024 SpringHill Suites Manhattan Beach (2) Hawthorne, CA Derecognized March 1, 2024 SpringHill Suites Plymouth Meeting (2) Plymouth Meeting, PA Derecognized March 1, 2024 Courtyard Basking Ridge (2) Basking Ridge, NJ Derecognized March 1, 2024 Courtyard Newark Silicon Valley (2) Newark, CA Derecognized March 1, 2024 Courtyard Oakland Airport (2) Oakland, CA Derecognized March 1, 2024 Courtyard Plano Legacy Park (2) Plano, TX Derecognized March 1, 2024 Residence Inn Plano (2) Plano, TX Derecognized March 1, 2024 SpringHill Suites BWI Airport (2) Baltimore, MD Derecognized March 1, 2024 TownePlace Suites Manhattan Beach (2) Hawthorne, CA Derecognized March 1, 2024 Residence Inn Salt Lake City (1) Salt Lake City, UT Disposition March 6, 2024 Hilton Boston Back Bay (1) Boston, MA Disposition April 9, 2024 Hampton Inn Lawrenceville (1) Lawrenceville, GA Disposition April 23, 2024 Courtyard Manchester (1) Manchester, CT Disposition May 30, 2024 SpringHill Suites Kennesaw (1) Kennesaw, GA Disposition June 10, 2024 Fairfield Inn Kennesaw (1) Kennesaw, GA Disposition June 10, 2024 One Ocean (1) Atlantic Beach, FL Disposition June 27, 2024 The Ashton (1) Fort Worth, TX Disposition July 16, 2024 Le Méridien Fort Worth Fort Worth, TX Developed August 29, 2024 Courtyard Boston (1) Boston, MA Disposition January 10, 2025 Residence Inn Evansville (1) Evansville, IN Disposition August 11, 2025 Hilton NASA Clear Lake (1) Houston, TX Disposition August 22, 2025 Residence Inn San Diego (1) San Diego, CA Disposition October 15, 2025 Le Pavillon (1) New Orleans, LA Disposition December 18, 2025 ____________________________________ (1) Referred to as "Hotel Dispositions." (2) Referred to as "KEYS A and B properties." The following table illustrates the key performance indicators of the operating hotel properties included in our results of operations: Year Ended December 31, 2025 2024 RevPAR (revenue per available room) $ 131.68 $ 132.87 Occupancy 70.26 % 69.66 % ADR (average daily rate) $ 187.41 $ 190.75 The following table illustrates the key performance indicators of the 67 comparable hotel properties that were included in our results of operations for the full years ended December 31, 2025 and 2024, respectively: Year Ended December 31, 2025 2024 RevPAR $ 132.61 $ 134.02 Occupancy 69.50 % 71.13 % ADR $ 190.82 $ 188.40 Comparison of the Year Ended December 31, 2025 and 2024 Net Income (Loss) Attributable to the Company . Net income (loss) attributable to the Company changed $119.5 million from a net loss of $60.3 million for the year ended December 31, 2024 ("2024") to a net loss of $179.8 million for the year ended December 31, 2025 ("2025") as a result of the factors discussed below. Revenue . Rooms revenue from our hotel properties decreased $64.1 million, or 7.2%, to $825.6 million in 2025 compared to 2024. This decrease in 2025 is primarily attributable to decreases in rooms revenue of $48.5 million from our Hotel Dispositions, $13.7 million from the KEYS A and B properties that went into receivership in 2024 and $8.6 million at our comparable hotel properties. These decreases were partially offset by an increase of $6.7 million in rooms revenue from the Le Méridien Fort Worth which opened in August of 2024 (the "Le Méridien Opening"). Our comparable hotel properties experienced an increase of 1.3% in room rates and a decrease of 163 basis points in occupancy. Food and beverage revenue decreased $5.0 million, or 2.3%, to $207.6 million in 2025 compared to 2024. This decrease in 2025 is primarily attributable to decreases in food and beverage revenue of $7.1 million from our Hotel Dispositions and $404,000 from the KEYS A and B properties. These decreases were partially offset by higher food and beverage revenue of $1.2 million at our comparable hotel properties and $1.3 million from the Le Méridien Opening. Other hotel revenue, which consists mainly of internet access, parking, and spa revenue, increased $1.8 million, or 2.7%, to $69.6 million in 2025 compared to 2024. This increase in 2025 is primarily attributable to increases in other hotel revenue of $7.2 million from our comparable hotel properties and $522,000 from the Le Méridien Opening. These increases were partially offset by lower other hotel revenue of $5.4 million from our Hotel Dispositions and $488,000 from the KEYS A and B properties. Other revenue decreased $791,000, or 34.0%, to $1.5 million in 2025 compared to 2024. Hotel Operating Expenses . Hotel operating expenses decreased $47.1 million, or 5.8%, to $768.3 million in 2025 compared to 2024. Hotel operating expenses consist of direct expenses from departments associated with revenue streams and indirect expenses associated with support departments and management fees. Direct expenses decreased $17.7 million in 2025 compared to 2024, comprising a decrease of $18.5 million from our Hotel Dispositions and $3.9 million from the KEYS A and B properties. The decrease in direct expenses was partially offset by an increase in 2025 of $1.9 million from our comparable hotel properties and $2.7 million from the Le Méridien Opening, respectively. Direct expenses were 31.5% of total hotel revenue for 2025 and 31.2% for 2024. Indirect expenses and management fees decreased $29.4 million in 2025 compared to 2024, comprising a decrease of $23.7 million from our Hotel Dispositions, $751,000 from our comparable hotel properties and $6.6 million from the KEYS A and B properties. These decreases in 2025 were partially offset by an increase of $1.6 million from the Le Méridien Opening. Property Taxes, Insurance and Other . Property taxes, insurance and other expense decreased $4.3 million or 6.7%, to $59.8 million in 2025 compared to 2024. The decrease in 2025 was primarily due to a decrease of $4.9 million from our Hotel Dispositions and $1.0 million from the KEYS A and B properties. The decrease in 2025 was partially offset by an increase of $933,000 from our comparable hotel properties and $628,000 from the Le Méridien Opening. Depreciation and Amortization . Depreciation and amortization decreased $11.5 million or 7.5%, to $141.3 million in 2025 compared to 2024. The decrease in 2025 was primarily due to lower depreciation of $5.7 million from our Hotel Dispositions, $6.4 million from our comparable hotels and $1.8 million from the KEYS A and B properties. The decrease in 2025 was partially offset by an increase of $2.5 million from the Le Méridien Opening. Impairment Charges . Impairment charges were $67.6 million in 2025 and $59.3 million in 2024. In 2025, these charges included $31.5 million related to the Hilton Alexandria Old Town, $18.4 million related to the New Orleans Le Pavillon Hotel, $16.3 million related to the Hilton Santa Cruz Scotts Valley and $1.4 million related to the Residence Inn Evansville. In 2024, these charges included $35.9 million related to the Hilton Costa Mesa and $23.4 million related to the Embassy Suites Portland. See note 5 to our consolidated financial statements. Advisory Services Fee . The advisory services fee decreased $9.6 million, or 16.3%, to $49.0 million in 2025 compared to 2024. The advisory services fee represents fees incurred in connection with the advisory agreements between Ashford Inc. and the Company and, prior to September 2, 2025, between Ashford Inc. and Stirling OP. In 2025, the advisory services fee primarily comprised a base advisory fee of $32.9 million, reimbursable expenses of $16.3 million and fees totaling $687,000 associated with Stirling OP's advisory agreement. In 2024, the advisory services fee comprised a base advisory fee of $32.0 million, equity-based compensation of $1.8 million awarded to the officers and employees of Ashford Inc., reimbursable expenses of $23.7 million and fees totaling $1.1 million associated with Stirling OP's advisory agreement. Corporate, General and Administrative . Corporate, general and administrative expenses decreased $3.9 million, or 15.7%, to $20.8 million in 2025 compared to 2024. The decrease was primarily attributable to a decrease in reimbursements of Ashford Securities' operating expenses of $2.3 million, miscellaneous expenses of $1.4 million and public company costs of $750,000. The decrease in 2025 was partially offset by an increase of $569,000 in legal and professional expenses. Gain (Loss) on Consolidation of VIE and Disposition of Assets and Hotel Properties . Gain on consolidation of VIE and disposition of assets and hotel properties decreased $14.6 million, from $94.4 million in 2024 to $79.8 million in 2025. The gain in 2025 was primarily related to the sale of five of our hotel properties in 2025. Other increases include the sale of a parcel of land previously owned by our Residence Inn Orlando property in April 2025. The gain in 2024 was primarily related to the sale of seven of our hotel properties in 2024. Gain (Loss) on Derecognition of Assets . Gain on derecognition of assets decreased $128.1 million, from $167.2 million in 2024 to $39.1 million in 2025. The gain primarily represents the increase of the contract asset on our consolidated balance sheets. We record a contract asset associated with the accrued interest expense from the default of the KEYS A and KEYS B loans as we expect to be released from this obligation upon final resolution with the lender. The gain in 2025 relates to accrued interest on the KEYS A and B properties in receivership and the transfer of the Courtyard Oakland and the SpringHill Suites BWI Airport to a third-party purchaser in December 2025 and June 2025, respectively. In 2024, the gain primarily related to a gain of $133.9 million from the initial derecognition of assets of the KEYS A and B properties in March of 2024 and additional gains of $33.3 million from the associated accrued interest expense in 2024. See note 7 to our consolidated financial statements. Equity in Earnings (Loss) of Unconsolidated Entities . Equity in loss of unconsolidated entities was $325,000 in 2025 and $2.4 million in 2024. Equity in loss primarily results from our investment in an entity that owns the Meritage Resort and Spa and the Grand Reserve at the Meritage in Napa, California. Interest Income . Interest income was $4.7 million and $6.9 million in 2025 and 2024, respectively. The decrease in interest income in 2025 was primarily attributable to lower excess cash balances in 2025 compared to 2024. Other Income (Expense) . In 2025 and 2024, we recorded miscellaneous income of $0 and $108,000, respectively. Interest Expense and Amortization of Discounts and Loan Costs . Interest expense and amortization of discounts and loan costs decreased $17.1 million, or 6.3%, to $256.2 million in 2025 compared to 2024. The decrease was primarily due to lower cash interest expense and amortization of loan costs of $19.4 million as a result of the pay-off of the Oaktree loan in February 2025 and a $15.9 million decrease from our Hotel Dispositions. These decreases were partially offset by higher default interest and late charges recorded on mortgage loans in default of $6.0 million, higher interest expense and amortization of discounts and loan costs at our comparable hotels of $2.8 million and higher interest expense of $9.4 million from the Le Méridien Opening. Interest Expense Associated with Hotels in Receivership . Interest expense associated with hotels in receivership decreased $6.6 million, from $45.6 million in 2024 to $39.0 million in 2025. The decrease is due to five fewer hotels being under receivership for the entire period in 2025 compared to 2024. On July 2, 2024, the Courtyard Plano Legacy Park and the Residence Inn Plano were foreclosed on at a public auction. Additionally, on November 4, 2024, the receiver appointed for the KEYS Pool A and KEYS Pool B mortgage loans transferred the Courtyard Columbus Tipton Lakes to a third-party purchaser. On June 25, 2025 and December 22, 2025, the Courtyard Oakland and SpringHill Suites BWI Airport mortgage loans were also transferred to a third-party purchaser. As a result, the contract asset and corresponding indebtedness associated with hotels in receivership and accrued interest associated with hotels in receivership were reduced for the amounts attributable to each hotel. See note 7 to our consolidated financial statements. Write-off of Premiums, Loan Costs and Exit Fees . Write-off of premiums, loan costs and exit fees was $8.9 million in 2025 and $5.2 million in 2024. The balance in 2025 primarily related to fees of $6.1 million from loan refinances and modifications and fees of $2.2 million related to prepayment penalties and exit fees on loan refinances. The balance in 2024 primarily related to fees of $4.4 million related to loan refinances and modifications and $817,000 of unamortized loan cost write-offs. Gain (Loss) on Extinguishment of Debt . Gain (loss) on extinguishment of debt resulted in a gain of $335,000 in 2025 and a gain of $2.8 million in 2024. In June 2024, the Company was informed by its lender that the lender intended to exercise remedies for the maturity default on the Ashton Hotel in Fort Worth, Texas, which secured the Company's $8.9 million mortgage loan. The Company and the lender agreed to a deed-in-lieu of foreclosure, which was completed on July 16, 2024 and resulted in a gain on extinguishment of debt of approximately $2.6 million. Realized and Unrealized Gain (Loss) on Derivatives . Realized and unrealized gain (loss) on derivatives changed by $1.1 million from a $6.5 million loss in 2024 to a $5.3 million loss in 2025. In 2025, we recognized $6.5 million of net unrealized losses on our derivatives which were primarily attributable to interest rate caps. These unrealized losses were partially offset by net realized gains on interest rate caps of $1.2 million. In 2024, we recognized an unrealized loss of $27.4 million associated with interest rate caps and an unrealized loss of $5.4 million from the revaluation of the embedded debt derivative in the Oaktree Agreement. These unrealized losses were partially offset by net realized gains on interest rate caps of $26.3 million. Income Tax (Expense) Benefit . Income tax (expense) benefit changed $1.1 million, from income tax expense of $1.0 million in 2024 to an income tax benefit of $143,000 in 2025. The change is primarily due to decreases in the current state taxes of certain of our taxable entities. (Income) Loss from Consolidated Entities Attributable to Noncontrolling Interests . Our noncontrolling interest partners in consolidated entities were allocated a loss of $5.1 million and $4.0 million in 2025 and 2024, respectively. Noncontrolling interests in consolidated entities represented an ownership interest of 70.7% in 815 Commerce MM and, prior to September 2, 2025, 0.30% in Stirling OP. See notes 1 and 2 to our consolidated financial statements. Net (Income) Loss Attributable to Redeemable Noncontrolling Interests in Operating Partnership . Redeemable noncontrolling interests in operating partnership were allocated a net loss of $3.3 million in 2025 and a net loss of $683,000 in 2024. Redeemable noncontrolling interests represented ownership interests of 1.43% and 1.02% in the operating partnership as of December 31, 2025 and 2024, respectively. LIQUIDITY AND CAPITAL RESOURCES Liquidity As of December 31, 2025 , the Company held cash and cash equivalents of $66.8 million and restricted cash of $149.6 million (including amounts held for sale), the vast majority of which comprises lender and manager-held reserves. As of December 31, 2025, $25.7 million (including amounts held for sale) was also due to the Company from third-party hotel managers, most of which is held by one of the Company's managers and is available to fund hotel operating costs. During the year ended December 31, 2025, the net decrease in cash, cash equivalents and restricted cash (including cash, cash equivalents and restricted cash held for sale) was $4.1 million. As described in note 2 to our consolidated financial statements, t he Company forecasts it may not have enough cash to support the Company's daily operations one year from the date the financial statements are issued due primarily to anticipated debt service costs, debt maturities and the potential termination fee the Company would owe to Ashford LLC upon the triggering of the change of control provision in the Advisory Agreement. We have $1.9 billion of non-recourse loans that mature within one year from the date the financial statements are issued. If these loans are not refinanced and our lenders elect to foreclose on these properties, the change of control provision in the Advisory Agreement could be triggered beginning November 16, 2026 resulting in a termination fee (as defined in the Advisory Agreement.) We are taking several steps to reduce our cash utilization and potentially raise additional capital. The Company's ability to continue as a going concern is dependent upon its ability to improve the profitability of its operations, refinance or extend the maturity of our loans and increase our cash position from the sale of certain hotel properties. While the Company believes in the viability of its strategy, GAAP requires that in making this determination the Company cannot consider any remedies outside of the Company's control which have not been fully implemented. As such, the Company could not consider future potential fundraising activities, whether through equity or debt offerings or dispositions of hotel properties as we could not conclude they were probable of being effectively implemented. With respect to upcoming maturities, no assurances can be given that we will be able to refinance our upcoming maturities. Additionally, no assurances can be given that we will obtain additional financings or, if we do, what the amount and terms will be. Our failure to obtain future financing under favorable terms could adversely impact our ability to execute our business strategy or may result in lender foreclosure. Based on these factors, the Company has determined that there is substantial doubt about the Company's ability to continue as a going concern within one year after the date the financial statements are issued. The consolidated financial statements have been prepared assuming that the Company will continue as a going concern and do not include any adjustments that might result from the outcome of this uncertainty. The Company's cash and cash equivalents primarily comprised corporate cash invested in short-term U.S. Treasury securities with maturity dates of less than 90 days and corporate cash held at commercial banks in Insured Cash Sweep ("ICS") accounts, which are fully insured by the FDIC. The Company's cash and cash equivalents also includes property-level operating cash deposited with commercial banks that have been designated as a Global Systemically Important Bank ("G-SIB") by the Financial Stability Board ("FSB") and a small amount deposited with other commercial banks. Our cash position from operations is affected primarily by macro industry movements in occupancy and rates as well as our ability to control costs. Further, interest rates can greatly affect the cost of our debt service as well as the value of any financial hedges we may put in place. We monitor industry fundamentals and interest rates very closely. Capital expenditures above our reserves will affect cash flow as well and are impacted by inflation. Certain of our loan agreements contain cash trap provisions that may be triggered if the performance of our hotels declines below a threshold. When these provisions are triggered, substantially all of the profit generated by our hotels is deposited directly into lockbox accounts and then swept into cash management accounts for the benefit of our various lenders. During a cash trap, certain disbursements from these hotel operating cash receipts would require consent of our lenders. At December 31, 2025, 43 of our hotels were in cash traps and approximately $4.5 million of our restricted cash was subject to these cash traps. Our loans currently in cash traps may remain subject to cash trap provisions for a substantial period of time, which could limit our flexibility and adversely affect our financial condition or our qualification as a REIT. We have extension options relating to certain property-level loans that will permit us to extend the maturity date of our loans if certain conditions are satisfied at the respective extension dates, including the achievement of debt yield targets required in order to extend such loans. To the extent we decide to extend the maturity date of the debt outstanding under the loans, we may be required to prepay a significant amount of the loans in order to meet the required debt yield targets. There can be no assurances that we will be able to meet the conditions for extensions pursuant to the respective terms of such loans. If we violate covenants in our debt agreements, we could be required to repay all or a portion of our indebtedness before maturity at a time when we might be unable to arrange financing for such repayment on attractive terms, if at all. The assets of certain of our subsidiaries are pledged under non-recourse indebtedness and are not available to satisfy the debts and other obligations of Ashford Trust or Ashford Trust OP, our operating partnership, and the liabilities of such subsidiaries do not constitute the obligations of Ashford Trust or Ashford Trust OP. Mortgage and mezzanine loans are non-recourse to the borrowers, except for customary exceptions or carve-outs that trigger recourse liability to the borrowers in certain limited instances. Recourse obligations typically include only the payment of costs and liabilities suffered by lenders as a result of the occurrence of certain bad acts on the part of the borrower. However, in certain cases, carve-outs could trigger recourse obligations on the part of the borrower with respect to repayment of all or a portion of the outstanding principal amount of the loans. We have entered into customary guaranty agreements pursuant to which we guaranty payment of any recourse liabilities of the borrowers that result from non-recourse carve-outs (which include, but are not limited to, fraud, misrepresentation, willful conduct resulting in waste, misappropriation of rents following an event of default, voluntary bankruptcy filings, unpermitted transfers of collateral and certain environmental liabilities). In the opinion of management, none of these guaranty agreements, either individually or in the aggregate, are likely to have a material adverse effect on our business, results of operations, or financial condition. Pursuant to the Advisory Agreement between us and our advisor, we must pay our advisor on a monthly basis a base management fee, subject to a minimum base management fee. The minimum base management fee is equal to the greater of: (i) 90% of the base fee paid for the same month in the prior fiscal year; and (ii) 1/12th of the "G&A Ratio" for the most recently completed fiscal quarter multiplied by our total market capitalization on the last balance sheet date included in the most recent quarterly report on Form 10-Q or annual report on Form 10-K that we file with the SEC. Thus, even if our total market capitalization and performance decline, we will still be required to make payments to our advisor equal to the minimum base management fee, which could adversely impact our liquidity and financial condition. We have entered into certain customary guaranty agreements pursuant to which we guarantee payment of any recourse liabilities of our subsidiaries or joint ventures that may result from non-recourse carve-outs, which include, but are not limited to, fraud, misrepresentation, willful misconduct resulting in waste, misappropriation of rents following an event of default, voluntary bankruptcy filings, unpermitted transfers of collateral, delinquency of trade payables and certain environmental liabilities. Certain of these guarantees represent a guaranty of material amounts, and if we are required to make payments under those guarantees, our liquidity could be adversely affected. Our existing hotel properties are mostly located in developed areas with competing hotel properties. Future occupancy, ADR, and RevPAR of any individual hotel could be materially and adversely affected by an increase in the number or quality of competitive hotel properties, home-sharing companies or apartment operators offering short-term rentals in its market area. Competition could also affect the quality and quantity of future investment opportunities. Our estimated future obligations as of December 31, 2025 include both current and long-term obligations. With respect to our indebtedness as of December 31, 2025, as discussed in note 7 to our consolidated financial statements, we have current obligations of $1.5 billion and long-term obligations of $1.1 billion. As of December 31, 2025, we have $1.1 billion of mortgage loans that have final maturities in 2026. We hold extension options for the remaining mortgage loans due in the next twelve months. Additionally, we have amortization payments of approximately $149,000 due in the next twelve months. Subsequent to December 31, 2025, we refinanced one mortgage loan with an outstanding loan balance of approximately $733.6 million that had a final maturity in 2026. We additionally exercised the first one-year extension option on our Morgan Stanley Pool mortgage loan and paid down $111.1 million in principal on the loan in conjunction with the sales of the Hilton St. Petersburg Bayfront, the Embassy Suites Austin and the Embassy Suites Houston. On March 17, 2026, we additionally paid down $56.0 million in principal on our Aareal two-pack mortgage loan in conjunction with the sale of the La Posada de Santa Fe. As discussed in note 19 to our consolidated financial statements, under our operating and finance leases we have current obligations of $5.7 million and long-term obligations of $258.7 million. Additionally, we have short-term capital commitments of $64.2 million. Debt Transactions Derecognition of Assets The KEYS mortgage loans were entered into on June 13, 2018, each of which had a two-year initial term and five one-year extension options. In order to qualify for a one-year extension in June of 2023, each KEYS loan pool was required to achieve a certain debt yield test. The Company extended its KEYS Pool C loan with a paydown of approximately $62.4 million, its KEYS Pool D loan with a paydown of approximately $25.6 million, and its KEYS Pool E loan with a paydown of approximately $41.0 million. On July 7, 2023, the Company elected not to make the required paydowns to extend its KEYS Pool A loan, KEYS Pool B loan and KEYS Pool F loan thereby defaulting on such loans. On November 29, 2023, the Company completed the deed in lieu of foreclosure transaction for the transfer of ownership of the KEYS Pool F $215.1 million mortgage to the mortgage lender. The Company continues to work with the lender of the KEYS A and KEYS B loan pools on a consensual transfer of ownership of those hotels to the lender. The original lenders previously transferred the loans to a securitization trust. On March 1, 2024, the Company received notice that the hotel properties that secured the KEYS Pool A and KEYS Pool B loans have been transferred to a court-appointed receiver. Below is a summary of the hotel properties that secured the KEYS Pool A and Pool B loans: KEYS A Loan Pool Courtyard Columbus Tipton Lakes - Columbus, IN Courtyard Old Town - Scottsdale, AZ Residence Inn Hughes Center - Las Vegas, NV Residence Inn Phoenix Airport - Phoenix, AZ Residence Inn San Jose Newark - Newark, CA SpringHill Suites Manhattan Beach - Hawthorne, CA SpringHill Suites Plymouth Meeting - Plymouth Meeting, PA KEYS B Loan Pool Courtyard Basking Ridge - Basking Ridge, NJ Courtyard Newark Silicon Valley - Newark, CA Courtyard Oakland Airport - Oakland, CA Courtyard Plano Legacy Park - Plano, TX Residence Inn Plano - Plano, TX SpringHill Suites BWI Airport - Baltimore, MD TownePlace Suites Manhattan Beach - Hawthorne, CA We derecognized the hotel properties that secured the KEYS Pool A and KEYS Pool B loans from our consolidated balance sheet in March 2024, when the receiver took control of the hotel properties and, accordingly, recognized a gain of $133.9 million, which is included in "gain (loss) on derecognition of assets" in our consolidated statements of operations for the three months ended March 31, 2024. We recorded a contract asset of $378.2 million as of March 31, 2024, which represented the liabilities from which we expect to be released upon final resolution with the lenders on the KEYS Pool A and KEYS Pool B mortgage loans in exchange for the transfer of ownership of the respective hotel properties. Subsequent to March 31, 2024, we recognized an additional gain of $33.3 million that increased the contract asset by a corresponding amount. The additional gain primarily represents the additional accrued interest expense recorded through December 31, 2024. In total for the year ended December 31, 2024, we recognized a gain of $167.2 million. On July 2, 2024, the Courtyard Plano Legacy Park and the Residence Inn Plano were foreclosed on at a public auction. Additionally, on November 4, 2024, the receiver appointed for the KEYS Pool A and KEYS Pool B mortgage loans transferred the Courtyard Columbus Tipton Lakes to a third-party purchaser. As a result, the contract asset and corresponding indebtedness associated with hotels in receivership and accrued interest associated with hotels in receivership were reduced for the amounts attributable to each hotel. For the year ended December 31, 2025, we recognized an additional gain of $39.1 million, which was included in "gain (loss) on derecognition of assets" in our consolidated statement of operations that increased the contract asset by a corresponding amount. The KEYS Pool A and the KEYS Pool B mortgage loans, as well as all accrued and unpaid interest, default charges and late fees will remain liabilities until final resolution with the lenders is concluded. On June 25, 2025 and December 22, 2025, the receiver appointed for the KEYS Pool A and KEYS Pool B mortgage loans transferred the Courtyard Oakland and SpringHill Suites BWI Airport to a third-party purchaser. Additionally, on March 4, 2026, the receiver appointed for the KEYS Pool A and KEYS Pool B mortgage loans transferred the SpringHill Suites Plymouth Meeting to a third-party purchaser. As a result, the contract asset and corresponding indebtedness associated with hotels in receivership and accrued interest associated with hotels in receivership were reduced for the amounts attributable to each hotel. Other Loan Activity On February 12, 2025, the Company closed on a $580 million refinancing secured by 16 hotels. The financing includes the hotels that were previously part of the Company's KEYS Pool C Loan, KEYS Pool D Loan, KEYS Pool E Loan, and the BAML Pool 3 Loan, together with the Westin Princeton. The previous loans had a combined outstanding loan balance of approximately $438.7 million. The new financing is non-recourse, has a two-year term with three one-year extension options, subject to the satisfaction of certain conditions. The Company used approximately $72 million of the excess proceeds to completely pay off the remaining balance on the Oaktree Credit Agreement, including the $30.0 million exit fee. On February 24, 2025, the Company amended its mortgage loan secured by the 141-room Hotel Indigo Atlanta Midtown in Atlanta, Georgia. Terms of the amendment included extending the current maturity date to February 2026 and adding one one-year extension option, subject to satisfaction of certain conditions. On March 6, 2025, the $22.1 million non-recourse mortgage loan secured by the Hilton Santa Cruz Scotts Valley reached final maturity and was not repaid, resulting in a default under the terms and conditions of the mortgage loan agreement. On March 17, 2026, the Company was notified the lender intends to appoint a receiver for the property. On April 14, 2025, the Company successfully extended its Morgan Stanley Pool mortgage loan secured by 17 hotels. The loan had an original final maturity date in November of 2024. The extension provides for an initial maturity in March of 2026 and two one-year extension options, subject to the satisfaction of certain conditions, with a final maturity date in March of 2028. In March of 2026, the Company exercised its first extension option. On May 8, 2025, the Company received $35.0 million in return for a preferred equity investment in the Renaissance Hotel in Nashville, Tennessee. The holder is entitled to an all-in rate of return on the preferred equity of 14.0% per annum. The investment is mandatorily redeemable on May 10, 2029. On July 30, 2025, the Company extended its Highland mortgage loan secured by 18 hotels with an original maturity date of April 2025. Terms of the amendment included a $10.0 million principal paydown, extending the maturity date to January 9, 2026. The loan is subject to a six-month extension option to July 9, 2026, upon satisfaction of certain conditions. On August 14, 2025, Ashford Trust OP executed a promissory note with Ashford LLC allowing Ashford Trust OP to draw up to $20 million in cash through August 15, 2026 to fund certain permitted costs (as defined in the promissory note). Funds advanced under the promissory note bear interest at an annual rate of 10.0% which may be paid in cash or paid in-kind at Ashford OP's discretion. The maturity date of the promissory note was August 15, 2026, at which time all principal drawn upon and outstanding interest would have been due and payable. As collateral to secure the repayment of any amounts advanced by Ashford LLC under the promissory note, the Company pledged to Ashford LLC the Company's equity in Ashford Trust OP subject to Ashford LLC's filing of a financing statement in the appropriate jurisdiction. On November 10, 2025, the promissory note was amended and restated. See below. On September 15, 2025, the Company refinanced the mortgage loan for the Renaissance Hotel in Nashville, Tennessee. The new, non-recourse loan has a balance of $218.1 million and has a two-year term with three one-year extension options, subject to the satisfaction of certain conditions, with a final maturity date of September 2030. The loan is interest only. In conjunction with the debt refinancing, the preferred equity investment on the property was upsized by $53.0 million, and the all-in rate of return on the preferred equity was reduced from 14% to 11.14%. On November 10, 2025, Ashford Trust OP executed an Amended and Restated Master Line of Credit Promissory Note (the "Amended and Restated Promissory Note") with Ashford Hospitality Advisors LLC ("Ashford LLC"), a subsidiary of Ashford Inc., amending the original Master Line of Credit Promissory note, dated August 14, 2025, allowing Ashford Trust OP to draw up to $40 million in cash through November 15, 2026 to fund Permitted Costs (as defined in the Promissory Note). Funds advanced under the Amended and Restated Promissory Note bear interest at an annual rate of 10.0% which may be paid in cash or paid in-kind at Ashford OP's discretion. The maturity date of the Amended and Restated Promissory Note is November 15, 2026, at which time all principal drawn upon and outstanding interest are due and payable. As collateral to secure the repayment of any amounts advanced by Ashford LLC under the Amended and Restated Promissory Note, the Company pledged to Ashford LLC the Company's equity in Ashford Trust OP subject to Ashford LLC's filing of a financing statement in the appropriate jurisdiction. On January 13, 2026, the Company extended its Highland mortgage loan secured by 18 hotels. As a condition to the extension, the loan was paid down by $10 million to a current balance of $723.6 million, or approximately 65% of appraised value, and has a final maturity date of July 9, 2026. On February 11, 2026, the Company received a notice of default and acceleration from the lender relating to the Company's mortgage loan on the JPM8 hotel properties. The notice followed the Company's failure on February 9, 2026 to make certain required payments and deliver required documentation under the existing loan extension, which constituted an event of default under the loan agreement. As a result, the lender demanded immediate payment of the outstanding principal balance of $325 million, plus accrued interest, default interest, fees, and other amounts due, and also required delivery of a replacement interest rate cap agreement. The loan is secured by eight hotel properties. The notice does not trigger any cross-defaults under other loans of the Company's subsidiaries, and the Company has no indebtedness at the parent-company level. Equity Transactions The board of directors has approved a stock repurchase program (the "Repurchase Program") to acquire shares of the Company's common stock and preferred stock having an aggregate value of up to $200 million. No shares have been repurchased under the Repurchase Program. The ability to make repurchases under the Repurchase Program is subject to the same financial factors that must be taken into account in declaring a dividend as discussed herein under "Distribution Policy." The Company has a distribution agreement with Virtu (the "Virtu Equity Distribution Agreement") to sell from time to time shares of the Company's common stock having an aggregate offering price of up to $100 million. We will pay Virtu a commission of approximately 1% of the gross sales price of the shares of our common stock sold. The Company may also sell some or all of the shares of our common stock to Virtu as principal for its own account at a price agreed upon at the time of sale. As of March 18, 2026, the Company has issued approximately 813,000 shares of common stock for gross proceeds of approximately $10.9 million under the Virtu Equity Distribution Agreement. On April 29, 2025, the Company filed a shelf registration statement on Form S-3 with the SEC relating to common stock, preferred stock, depositary shares, debt securities, warrants, rights and units that we may sell from time to time in one or more offerings up to a total dollar amount of $500,000,000 on terms to be determined at the time of sale. The registration statement was declared effective on May 8, 2025. As a result of the Company not paying dividends to the holders of our Preferred Stock on January 15, 2026, we are no longer eligible to use our existing shelf registration statement on Form S-3. As of March 18, 2026, the Company has not issued any securities from this registration statement. On December 13, 2024, the Company filed an initial registration statement on Form S-11 with the SEC, as amended on January 23, 2025, related to the Company's non-traded Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock. The registration statement was declared effective by the SEC on February 7, 2025, and contemplates the offering of up to (i) 8.4 million shares of Series L Redeemable Preferred Stock and 3.6 million shares of Series M Redeemable Preferred Stock in a primary offering and (ii) 2.8 million shares of Series L Redeemable Preferred Stock and 1.2 million shares of Series M Redeemable Preferred Stock pursuant to a dividend reinvestment plan. On February 7, 2025, we filed our prospectus for the offering with the SEC. Ashford Securities, a subsidiary of Ashford Inc., serves as the dealer manager for the offering. On December 9, 2025, the Company terminated the primary offering of the Company's Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock. The Company continued to offer shares of its Series L Redeemable Preferred Stock and Series M Redeemable Preferred Stock pursuant to its dividend reinvestment plan beyond the termination of the primary offering As of March 18, 2026, the Company has issued approximately 243,000 shares (exclusive of the dividend reinvestment plan shares) of Series L Preferred Stock and received net proceeds of approximately $5.0 million and approximately 565,000 shares (exclusive of the dividend reinvestment plan shares) of Series M Preferred Stock and received net proceeds of approximately $12.6 million. On March 4, 2022, the Company filed an initial registration statement on Form S-3 with the SEC, as amended on April 29, 2022, related to the Company's non-traded Series J Preferred Stock and Series K Preferred Stock. The registration statement was declared effective by the SEC on May 4, 2022, and contemplates the offering of up to (i) 20.0 million shares of Series J Preferred Stock or Series K Preferred Stock in a primary offering and (ii) 8.0 million shares of Series J Preferred Stock or Series K Preferred Stock pursuant to a dividend reinvestment plan. On May 5, 2022, we filed our prospectus for the offering with the SEC. On March 31, 2025, the Company concluded its offering of its Series J Preferred Stock and Series K Preferred Stock. Ashford Securities, a subsidiary of Ashford Inc., served as the dealer manager for the offering. As of March 18, 2026, the Company has issued approximately 7.7 million shares (exclusive of the dividend reinvestment plan shares) of Series J Preferred Stock and received net proceeds of approximately $172.6 million and approximately 799,000 shares (exclusive of the dividend reinvestment plan shares) of Series K Preferred Stock and received net proceeds of approximately $19.4 million. Sources and Uses of Cash Our principal sources of funds to meet our cash requirements include cash on hand, cash flow from operations, capital market activities, property refinancing proceeds and asset sales. Additionally, our principal uses of funds are expected to include possible operating shortfalls, owner-funded capital expenditures, dividends, new investments and debt interest and principal payments. Items that impacted our cash flow and liquidity during the periods indicated are summarized as follows: Net Cash Flows Provided by (Used in) Operating Activities . Net cash flows used in operating activities were $15.7 million and $23.6 million for the years ended December 31, 2025 and 2024, respectively. Cash flows used in operations were impacted by changes in hotel operations, our hotel dispositions and derecognized assets, as well as the timing of collecting receivables from hotel guests, paying vendors and settling with derivative counterparties, related parties and hotel managers. Net Cash Flows Provided by (Used in) Investing Activities . For the year ended December 31, 2025, net cash flows provided by investing activities were $190.8 million. Cash inflows consisted of $242.4 million of net proceeds from the disposition of assets and hotel properties, which included $235.2 million of net proceeds from the disposition of the five properties sold in 2025 and $7.2 million of net proceeds from the disposition of a land parcel previously owned by the Residence Inn Orlando property. Additional cash inflows included $18.8 million of net proceeds from the sale of state tax credits related to the Le Méridien Fort Worth and $734,000 from property insurance proceeds. Cash inflows were partially offset by cash outflows of $71.2 million for capital improvements made to various hotel properties. For the year ended December 31, 2024, net cash flows provided by investing activities were $191.3 million. Cash inflows consisted of $300.0 million of net proceeds from the disposition of assets and hotel properties, repayments from a note receivable of $2.5 million and $1.5 million from property insurance proceeds. Cash inflows were partially offset by cash outflows of $108.0 million for capital improvements made to various hotel properties and $4.5 million from the issuance of a note receivable. Net Cash Flows Provided by (Used in) Financing Activities . For the year ended December 31, 2025, net cash flows used in financing activities were $179.2 million. Cash outflows primarily consisted of $709.2 million for repayments of indebtedness, $50.3 million for payments of loan costs and exit fees, $5.1 million of payments for derivatives and $24.0 million of payments for preferred dividends. Cash outflows were partially offset by cash inflows from $560.4 million of borrowings on indebtedness, $39.7 million of net proceeds from preferred stock offerings, proceeds of $3.0 million from counterparties from in-the-money interest rate caps and $7.5 million of contributions from noncontrolling interests. For the year ended December 31, 2024, net cash flows used in financing activities were $258.8 million. Cash outflows primarily consisted of $388.3 million for repayments of indebtedness, $20.9 million for payments of loan costs and exit fees, $20.4 million of payments for preferred dividends, $16.3 million of payments for derivatives and $2.5 million of distributions to noncontrolling interests. Cash outflows were partially offset by cash inflows primarily of $63.8 million of borrowing on indebtedness, $84.8 million of net proceeds from preferred stock offerings, $27.8 million from counterparties from in-the-money interest rate caps, $8.8 million of net proceeds from common stock offerings and $4.9 million of contributions from noncontrolling interests. Dividend Policy . Distributions are authorized by our board of directors and declared by us based upon a variety of factors deemed relevant by our directors. The board of directors will continue to review our distribution policy on at least a quarterly basis. Our ability to pay distributions to our preferred or common stockholders will depend, in part, upon our receipt of distributions from our operating partnership. This, in turn, may depend upon receipt of lease payments with respect to our properties from indirect subsidiaries of our operating partnership, the management of our properties by our hotel managers and general business conditions. Distributions to our stockholders are generally taxable to our stockholders as ordinary income. However, since a portion of our investments are equity ownership interests in hotels, which result in depreciation and non-cash charges against our income, a portion of our distributions may constitute a non-taxable return of capital, to the extent of a stockholder's tax basis in the stock. To the extent that it is consistent with maintaining our REIT status, we may maintain accumulated earnings of Ashford TRS in that entity. On December 15, 2025, our board of directors reviewed and approved our 2026 dividend policy. We do not anticipate paying any dividends on our outstanding common stock for any quarter during 2026. Further, to preserve the Company's liquidity position as it evaluates strategic alternatives, preferred dividends have been suspended, including dividends previously declared for recordholders of the Company's Series D, F, G, H, I, J, K, L and M preferred stock as of December 31, 2025, and payable on January 15, 2026. We intend to pay the previously declared but unpaid dividends as soon as reasonably practicable. Any accrued but unpaid dividends will accrue in accordance with the terms outlined in the applicable governing documents for each series of preferred stock. We will continue to evaluate potential future dividends on a quarterly basis. Declaration of dividends in 2026 on our preferred stock may require a determination by our board of directors, at the time of any determination, that the Company would continue to have positive equity on a fair value basis, among other considerations. Our board of directors will continue to review our dividend policy and make future announcements with respect thereto. We may incur indebtedness to meet distribution requirements imposed on REITs under the Code to the extent that working capital and cash flow from our investments are insufficient to fund required distributions. INFLATION We rely entirely on the performance of our hotel properties and the ability of the hotel properties' managers to increase revenues to keep pace with inflation. Hotel operators can generally increase room rates, but competitive pressures may limit their ability to raise rates faster than inflation. Our general and administrative costs, real estate and personal property taxes, property and casualty insurance, labor costs and utilities are subject to inflation as well. CRITICAL ACCOUNTING POLICIES AND ESTIMATES Our significant accounting policies are fully described in note 2 to our consolidated financial statements included in Item 8. Financial Statements and Supplementary Data. We believe that the following discussion addresses our most critical accounting estimates, representing those policies considered most vital to the portrayal of our financial condition and results of operations and require management's most difficult, subjective, complex judgments and can include significant estimates. Impairment of Investments in Hotel Properties -Hotel properties are reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. Recoverability of the hotel is measured by comparison of the carrying amount of the hotel to the estimated future undiscounted cash flows, which take into account current market conditions and our intent with respect to holding or disposing of the hotel. If our analysis indicates that the carrying value of the hotel is not recoverable on an undiscounted cash flow basis, we recognize an impairment charge for the amount by which the property's net book value exceeds its estimated fair value, or fair value, less cost to sell. In evaluating impairment of hotel properties, we make many assumptions and estimates, including projected cash flows, expected holding period, and expected useful life. Fair value is determined through various valuation techniques, including internally developed discounted cash flow models, comparable market transactions and third-party appraisals, where considered necessary. We recorded $67.6 million and $59.3 million of impairment charges for the years ended December 31, 2025 and 2024, respectively. No impairment charge was recorded for the year ended December 31, 2023. See note 5 to our consolidated financial statements. Income Taxes -As a REIT, we generally are not subject to federal corporate income tax on the portion of our net income (loss) that does not relate to taxable REIT subsidiaries. However, Ashford TRS is treated as a taxable REIT subsidiary for U.S. federal income tax purposes. In accordance with authoritative accounting guidance, we account for income taxes related to Ashford TRS using the asset and liability method under which deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. In addition, the analysis utilized by us in determining our deferred tax asset valuation allowance involves considerable management judgment and assumptions. See note 20 to our consolidated financial statements. At December 31, 2025 and 2024, we recorded a valuation allowance of $45.9 million and $37.6 million, respectively on the net deferred tax assets of our taxable REIT subsidiaries. At each reporting date, we evaluate whether it is more likely than not that we will utilize all or a portion of our deferred tax assets. We consider all available positive and negative evidence, including historical results of operations, projected future taxable income, carryback potential and scheduled reversals of deferred tax liabilities. At December 31, 2025, we had TRS NOLs for U.S. federal income tax purposes of $174.2 million, however $82.5 million of our NOLs are subject to limitation in the amount of approximately $1.2 million per year under Section 382 of the Internal Revenue Code. NOLs become subject to an annual limitation in the event of certain cumulative changes in the ownership of significant shareholders over a three-year period in excess of 50%, as defined under Section 382 of the Internal Revenue Code. The remaining $91.7 million of our TRS federal NOLs are not subject to the limitations of Section 382. In total $1.9 million of our TRS federal NOLs are subject to expiration and will begin to expire in 2026. The remainder were generated after December 31, 2017 and are not subject to expiration under the Tax Cuts and Jobs Act. At December 31, 2025, we had state net operating loss carryforwards of $1.1 billion which begin to expire in 2027. The Company also has indefinite-lived state NOLs. At December 31, 2025, we had REIT NOLs for U.S. federal income tax purposes of $1.4 billion based on the latest filed tax returns. The majority of our REIT NOLs are subject to limitation on their use under Section 382. $424.0 million of our net operating loss carryforwards will begin to expire in 2029 and are available to offset future taxable income, if any, through 2036. The remainder were generated after December 31, 2017 and are not subject to expiration under the Tax Cuts and Jobs Act. The "Income Taxes" topic of the ASC issued by the Financial Accounting Standards Board ("FASB") which addresses the accounting for uncertainty in income taxes recognized in an enterprise's financial statements. The guidance requires us to determine whether tax positions we have taken or expect to take in a tax return are more likely than not to be sustained upon examination by the appropriate taxing authority based on the technical merits of the positions. Tax positions that do not meet the more likely than not threshold would be recorded as additional tax expense in the current period. We analyze all open tax years, as defined by the statute of limitations for each jurisdiction, which includes the federal jurisdiction and various states. We classify interest and penalties related to underpayment of income taxes as income tax expense. We and our subsidiaries file income tax returns in the U.S. federal jurisdiction and various states and cities. Tax years 2021 through 2025 remain subject to potential examination by certain federal and state taxing authorities. RECENTLY ADOPTED ACCOUNTING STANDARDS In December 2023, the FASB issued ASU 2023-09 Income Taxes (Topics 740): Improvements to Income Tax Disclosures to expand the disclosure requirements for income taxes, specifically related to the rate reconciliation and income taxes paid. ASU 2023-09 is effective for our annual periods beginning January 1, 2025. The amendments in this ASU may be applied prospectively by providing the revised disclosures for the period ending December 31, 2025 and continuing to provide the pre-ASU disclosures for the prior periods, or the amendments may be applied retrospectively by providing the revised disclosures for all periods presented. As of December 31, 2025, the Company has prospectively adopted this ASU. The adoption of this ASU only impacted disclosures with respect to the Company's consolidated financial statements. RECENTLY ISSUED ACCOUNTING STANDARDS In November 2024, the FASB issued ASU 2024-03 , Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) Disaggregation of Income Statement Expenses that requires more detailed information about specified categories of expenses (purchases of inventory, employee compensation, depreciation, amortization, and depletion) included in certain expense captions presented on the face of the statement of operations. In January 2025, the FASB issued ASU 2025-01 which amends the effective date of the new disaggregation of income statement expenses standard to clarify that all public business entities are required to adopt the guidance in annual reporting periods beginning after Dec. 15, 2026, and interim periods within annual reporting periods beginning after Dec. 15, 2027. Early adoption is still permitted. The amendments may be applied either (1) prospectively to financial statements issued for reporting periods after the effective date of this ASU or (2) retrospectively to all prior periods presented in the financial statements. We are currently evaluating the impact this ASU will have on our disclosures. NON-GAAP FINANCIAL MEASURES The following non-GAAP presentations of EBITDA, EBITDAre, Adjusted EBITDAre, FFO and Adjusted FFO are presented to help our investors evaluate our operating performance. EBITDA is defined as net income (loss) before interest expense and amortization of discounts and loan costs, net, income taxes, depreciation and amortization, as adjusted to reflect only the Company's portion of EBITDA of unconsolidated entities. In addition, we exclude impairment on real estate, gain/loss on consolidation of VIE and disposition of assets and hotel properties, gain/loss on derecognition of assets and gain/loss of unconsolidated entities to calculate EBITDAre, as defined by NAREIT. We then further adjust EBITDAre to exclude certain additional items such as write-off of premiums, loan costs and exit fees, other income/expense, net, transaction and conversion costs, stock/unit-based compensation and non-cash items, such as amortization of unfavorable contract liabilities, realized and unrealized gains/losses on derivative instruments, gains/losses on extinguishment of debt, severance, as well as our portion of adjustments to EBITDAre of unconsolidated entities. We present EBITDA, EBITDAre and Adjusted EBITDAre because we believe they are useful to an investor in evaluating our operating performance because it provides investors with an indication of our ability to incur and service debt, to satisfy general operating expenses, to make capital expenditures and to fund other cash needs or reinvest cash into our business. We also believe it helps investors meaningfully evaluate and compare the results of our operations from period to period by removing the effect of our asset base (primarily depreciation and amortization) from our operating results. Our management team also uses EBITDA as one measure in determining the value of acquisitions and dispositions. EBITDA, EBITDAre and Adjusted EBITDAre as calculated by us may not be comparable to EBITDA, EBITDAre and Adjusted EBITDAre reported by other companies that do not define EBITDA, EBITDAre and Adjusted EBITDAre exactly as we define the terms. EBITDA, EBITDAre and Adjusted EBITDAre do not represent cash generated from operating activities determined in accordance with GAAP, and should not be considered as an alternative to operating income (loss) or net income (loss) determined in accordance with GAAP as an indicator of performance or as an alternative to cash flows from operating activities as determined by GAAP as an indicator of liquidity. The following table reconciles net income (loss) to EBITDA, EBITDAre and Adjusted EBITDAre (in thousands): Year Ended December 31, 2025 2024 2023 Net income (loss) $ (188,159) $ (65,011) $ (180,734) Interest expense and amortization of discounts and loan costs 256,229 273,359 326,970 Interest expense associated with hotels in receivership 39,038 45,592 39,178 Depreciation and amortization 141,295 152,776 187,807 Income tax expense (benefit) (143) 997 900 Equity in (earnings) loss of unconsolidated entities 325 2,370 1,134 Company's portion of EBITDA of unconsolidated entities 1,208 436 231 EBITDA 249,793 410,519 375,486 Impairment charges on real estate 67,648 59,331 - (Gain) loss on consolidation of VIE and disposition of assets and hotel properties (79,799) (94,406) (11,488) (Gain) loss on derecognition of assets (39,054) (167,177) - EBITDAre 198,588 208,267 363,998 Amortization of unfavorable contract liabilities (122) (122) (15) Transaction and conversion costs 9,549 10,809 3,856 Write-off of premiums, loan costs and exit fees 8,853 5,245 3,469 Realized and unrealized (gain) loss on derivatives 5,346 6,480 2,200 Stock/unit-based compensation (760) 2,097 4,027 Legal, advisory and settlement costs 1,871 3,230 1,181 Other (income) expense, net - (108) (310) (Gain) loss on insurance settlements (2,950) (73) (505) (Gain) loss on extinguishment of debt (335) (2,774) (53,386) Severance 1,228 2,824 - Company's portion of adjustments to EBITDAre of unconsolidated entities - 6 2 Adjusted EBITDAre $ 221,268 $ 235,881 $ 324,517 We calculate FFO and Adjusted FFO in the following table. FFO is calculated on the basis defined by NAREIT, which is net income (loss) attributable to common stockholders, computed in accordance with GAAP, excluding gains or losses on consolidation of VIE and disposition of assets and hotel properties, plus depreciation and amortization of real estate assets, impairment charges on real estate assets, and after adjustments for unconsolidated entities and noncontrolling interests in the operating partnership. Adjustments for 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 Adjusted FFO excludes write-off of premiums, loan costs and exit fees, other income/expense, net, transaction and conversion costs, legal, advisory and settlement costs, stock/unit-based compensation, gains/losses on insurance settlements and non-cash items such as deemed dividends on redeemable preferred stock, amortization of loan costs, amortization of credit facility exit fees, default interest and late fees, unrealized gains/losses on derivative instruments, gains/losses on extinguishment of debt and preferred stock, severance, and interest expense associated with hotels in receivership and our portion of adjustments to FFO related to unconsolidated entities. We exclude items from Adjusted FFO 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 present FFO and Adjusted FFO because we consider FFO and Adjusted FFO important supplemental measures of our operational performance and believe they are frequently used by securities analysts, investors and other interested parties in the evaluation of REITs, many of which present FFO and Adjusted FFO when reporting their results. FFO and Adjusted FFO are intended to exclude GAAP historical cost depreciation and amortization, which assumes that the value of real estate assets diminishes ratably over time. Historically, however, real estate values have risen or fallen with market conditions. Because FFO and Adjusted FFO exclude depreciation and amortization related to real estate assets, gains and losses from real property dispositions and impairment losses on real estate assets, FFO and Adjusted FFO provide performance measures that, when compared year over year, reflect the effect to operations from trends in occupancy, guestroom rates, operating costs, development activities and interest costs, providing perspective not immediately apparent from net income. We consider FFO and Adjusted FFO to be appropriate measures of our ongoing normalized operating performance as a REIT. We compute FFO in accordance with our interpretation of standards established by NAREIT, which may not be comparable to FFO 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 we do. FFO and Adjusted FFO 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 Adjusted FFO 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 (in thousands): Year Ended December 31, 2025 2024 2023 Net income (loss) $ (188,159) $ (65,011) $ (180,734) (Income) loss attributable to noncontrolling interest in consolidated entities 5,058 4,028 6 Net (income) loss attributable to redeemable noncontrolling interests in operating partnership 3,262 683 2,239 Preferred dividends (28,216) (22,686) (15,921) Deemed dividends on redeemable preferred stock (6,949) (2,906) (2,673) Gain (loss) on extinguishment of preferred stock - 3,370 3,390 Net income (loss) attributable to common stockholders (215,004) (82,522) (193,693) Depreciation and amortization of real estate 138,441 152,776 187,807 (Gain) loss on consolidation of VIE and disposition of assets and hotel properties (79,799) (94,406) (11,488) (Gain) loss on derecognition of assets (39,054) (167,177) - Net income (loss) attributable to redeemable noncontrolling interests in operating partnership (3,262) (683) (2,239) Equity in (earnings) loss of unconsolidated entities 325 2,370 1,134 Impairment charges on real estate 67,648 59,331 - Company's portion of FFO of unconsolidated entities 192 (932) (668) FFO available to common stockholders and OP unitholders (130,513) (131,243) (19,147) Deemed dividends on redeemable preferred stock 6,949 2,906 2,673 (Gain) loss on extinguishment of preferred stock - (3,370) (3,390) Transaction and conversion costs 9,549 10,809 3,856 Write-off of premiums, loan costs and exit fees 8,853 5,245 3,469 Unrealized (gain) loss on derivatives 7,064 32,790 44,041 Stock/unit-based compensation (760) 2,097 4,027 Legal, advisory and settlement costs 1,871 3,230 1,181 Other (income) expense, net - (108) (310) Amortization of term loan exit fee - 844 18,616 Amortization of loan costs 25,490 13,591 12,735 (Gain) loss on insurance settlements (2,950) (73) (505) (Gain) loss on extinguishment of debt (335) (2,774) (53,386) Interest expense associated with hotels in receivership 39,038 40,045 - Severance 1,228 2,824 - Default interest and late fees - - 12,553 Company's portion of adjustments to FFO of unconsolidated entities 105 125 2 Adjusted FFO available to common stockholders and OP unitholders $ (34,411) $ (23,062) $ 26,415

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