DALLAS, Oct. 30, 2013 /PRNewswire/ -- Ashford
Hospitality Trust, Inc. (NYSE: AHT) ("Ashford Trust" or the
"Company") announced today that its Board of Directors has formally
declared the distribution of shares of common stock of Ashford
Hospitality Prime, Inc. (NYSE: AHP) ("Ashford Prime"), a wholly
owned subsidiary of Ashford Trust. The distribution will
consist of 100% of the common stock of Ashford Prime, which will be
distributed to Ashford Trust shareholders. Ashford Prime will
own approximately 65% of the Ashford Prime operating
partnership. Ashford Trust will own 20% of the Ashford Prime
operating partnership, while existing Ashford Trust operating
partnership unit holders will own the remaining approximate
15%. Following the distribution, Ashford Prime will be an
independent and conservatively capitalized publicly-traded real
estate investment trust ("REIT") focused on investing in high
RevPAR full-service and urban select-service hotels and resorts
located predominantly in domestic and international gateway markets
that will be externally advised by Ashford Advisors, a subsidiary
of Ashford Trust.
The spin-off will be completed through a pro-rata taxable
dividend of Ashford Prime common stock on November 19, 2013 (the "Distribution Date") to
Ashford Trust stockholders of record ("Ashford Trust Record
Holders") as of the close of business of the New York Stock
Exchange ("NYSE") on November 8, 2013
(the "Record Date"). On the Distribution Date, each Ashford
Trust stockholder will receive one share of Ashford Prime common
stock for every five shares of Ashford Trust common stock held by
such stockholder on the Record Date. Immediately following
the spin-off, there will be approximately 24.9 million shares of
Ashford Prime common stock and partnership units outstanding.
This will be comprised of approximately 16.1 million shares of
Ashford Prime common stock and 8.8 million partnership units, which
includes the partnership units issued to Ashford Trust reflecting
its 20% ownership in Ashford Prime's operating partnership.
The distribution of these shares will be made in book-entry form,
which means that no physical share certificates will be
issued.
No fractional shares of Ashford Prime common stock will be
issued. Fractional shares of Ashford Prime stock to which
Ashford Trust Record Holders would otherwise be entitled will be
aggregated and, after the distribution, sold in the open market by
the distribution agent. The aggregate net proceeds of the
sales will be distributed in a pro rata manner as cash payments to
those shareholders of record who would otherwise have received
fractional shares of Ashford Prime common stock. Ashford
Trust stockholders should consult their tax advisors with respect
to U.S. federal, state, local and foreign tax consequences of the
Ashford Prime spin-off.
Following the spin-off, Ashford Trust's shares of common stock
will continue to trade on the NYSE under the ticker symbol
"AHT." Ashford Prime intends to have its common stock listed
on the NYSE under the symbol "AHP." An information statement
concerning the details regarding the distribution of Ashford Prime
common stock and its business and management following the spin-off
will be mailed to Ashford Trust stockholders prior to the
Distribution Date.
Beginning on or about November 6,
2013 and continuing through the Distribution Date, it is
expected that there will be two markets in Ashford Trust common
stock: a "regular-way" market under the symbol "AHT," and an
"ex-distribution" market under the symbol "AHT WI." Shares of
Ashford Trust common stock that trade in the "regular-way" market
will trade with an entitlement to shares of common stock of Ashford
Prime distributed pursuant to the spin-off. Thus, Ashford
Trust common stock purchased in the "regular-way" market up to the
November 19, 2013 Distribution Date
will trade with an entitlement to shares of the common stock of
Ashford Prime distributed pursuant to the spin-off, and Ashford
Trust shareholders who sell shares of Ashford Trust common stock in
the "regular-way" market up to and including the Distribution Date
will be selling their right to receive shares of the common stock
of Ashford Prime in the spin-off. Shares that trade in the
"ex-distribution" market will trade without an entitlement to
shares of the common stock of Ashford Prime distributed pursuant to
the spin-off. A purchaser of Ashford Trust common stock after
the close of business on the Record Date who purchases those shares
in the "ex-distribution" market up to and including the
Distribution Date will not receive the shares of common stock of
Ashford Prime distributed with respect to those shares of Ashford
Trust common stock. Ashford Trust stockholders are encouraged
to consult with their financial advisors regarding the specific
implications of buying or selling Ashford Trust common stock on or
before the Distribution Date.
Furthermore, on or about November 6,
2013 and continuing through the Distribution Date, it is
expected that there will be a "when-issued" market in the common
stock of Ashford Prime under the symbol "AHP WI."
"When-issued" trading refers to a sale or purchase made
conditionally because the security has been authorized but not yet
issued. The "when-issued" trading market will be a market for
shares of Ashford Prime common stock that will be distributed to
Ashford Trust shareholders on the Distribution Date.
Shareholders of Ashford Trust common stock at the close of business
on the Record Date will be entitled to receive shares of Ashford
Prime's common stock distributed in the spin-off as will
shareholders who purchase Ashford Trust common stock in the
"regular-way" market up to November
19, 2013. Ashford Trust shareholders may trade this
entitlement to receive shares of common stock of Ashford Prime,
without the owned shares of Ashford Trust common stock, in the
"when-issued" market. On the first trading day following the
Distribution Date, expected to be November
20, 2013, "when-issued" trading with respect to Ashford
Prime common stock will end and "regular-way" trading will begin
under the symbol "AHP." Before the spin-off, Ashford Trust
and Ashford Prime will enter into a separation agreement and
various other agreements related to the spin-off, as described in
the information statement.
On the Distribution Date, Ashford Prime is expected to have a
new $150 million secured credit
facility with Bank of America, N.A. acting as sole administrative
agent. Other participating lenders include Credit Agricole,
Credit Suisse, Deutsche Bank, KeyBank, and Morgan Stanley.
BofA Merrill Lynch served as financial advisor to Ashford Trust in
connection with the spin-off.
Ashford Hospitality Trust is a real estate investment trust
(REIT) focused on investing opportunistically in the hospitality
industry across all segments and at all levels of the capital
structure primarily within the United
States.
Ashford Hospitality Prime will be a conservatively capitalized
real estate investment trust (REIT) focused on investing in high
RevPAR full-service and urban select-service hotels and resorts
located predominantly in domestic and international gateway
markets.
Follow Chairman and CEO Monty
Bennett on Twitter at www.twitter.com/MBennettAshford or
@MBennettAshford.
Certain statements and assumptions in this press release
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 we use the words "will likely result,"
"may," "anticipate," "estimate," "should," "expect," "believe,"
"intend," or similar expressions, we intend to identify
forward-looking statements. Such statements are subject to
numerous assumptions and uncertainties, many of which are outside
Ashford'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, including, without
limitation: general volatility of the capital markets and the
market price of our common stock; changes in our business or
investment strategy; availability, terms and deployment of capital;
availability of qualified personnel; changes in our industry and
the market in which we operate, interest rates or the general
economy; the degree and nature of our competition; the satisfaction
of the conditions to the completion of the spin-off; and the
estimated timing of completion. These and other risk factors
are more fully discussed in Ashford's filings with the Securities
and Exchange Commission.
The forward-looking statements included in this press release
are only made as of the date of this press release. Investors
should not place undue reliance on these forward-looking
statements. We are not obligated to publicly update or revise
any forward-looking statements, whether as a result of new
information, future events or circumstances, changes in
expectations or otherwise.
SOURCE Ashford Hospitality Trust, Inc.