SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported): June 15, 2009
ASHFORD HOSPITALITY TRUST, INC.
(Exact name of registrant as specified in its charter)
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MARYLAND
(State of Incorporation)
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001-31775
(Commission File Number)
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86-1062192
(I.R.S. Employer
Identification
Number) |
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14185 Dallas Parkway, Suite 1100
Dallas, Texas
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75254 |
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(Zip code) |
Registrant’s telephone number, including area code: (972) 490-9600
Check the appropriate box if the Form 8-K filing is intended to simultaneously satisfy the filing
obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
ITEM 2.06 — MATERIAL IMPAIRMENTS
On June 15, 2009, Ashford Hospitality Trust, Inc. (the “Company”), received notice that
Extended Stay Hotels LLC (“ESH”) was seeking Chapter 11 bankruptcy protection from its creditors.
The Company currently holds a $164 million mezzanine loan participation that is secured by
interests in 681 hotels held by Extended Stay, which loan was initially scheduled to mature June
12, 2009, with three 1-year renewal options. Prior to Extended Stay’s bankruptcy filing, all
payments on this loan were current; however, the Company anticipates that Extended Stay, through
its bankruptcy filing, may attempt to impose a plan of reorganization which eliminates the
Company’s investment. Accordingly, on June 17, 2009, the Company’s management concluded that it is
likely that the ESH investment has been materially impaired and the Company will likely record a
loss with respect to the investment. At this time, due to the uncertainty of actions that may be
taken in bankruptcy, management is unable to determine the amount, if any, of impairment loss the
Company may incur; however, management recognizes that the impairment loss could be up to the full
amount of its investment, $109,271,840 as of March 31, 2009. Further, at this time, the Company is
unable to estimate the amount of cash expenditures that the Company may incur in pursuing recovery
of the ESH investment.
Certain statements and assumptions in this Current Report on Form 8-K contain or are based
upon “forward-looking” information and are being made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to
risks and uncertainties. When the Company uses the words “may,” “anticipate,” “expect,” or similar
expressions, the Company intends to identify forward-looking statements. Such forward-looking
statements include, but are not limited to the impact of the event on the Company’s business and
future financial condition and projected capital expenditures. Such statements are subject to
numerous assumptions and uncertainties, many of which are outside the Company’s control.
These forward-looking statements are subject to known and unknown risks and uncertainties,
which could cause actual results to differ materially from those anticipated. These and other risk
factors are more fully discussed in the Company’s filings with the Securities and Exchange
Commission. The forward-looking statements included in this Current Report on Form 8-K are only
made as of the date hereof. Investors should not place undue reliance on these forward-looking
statements. The Company is not obligated to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or circumstances, changes in
expectations or otherwise.