Company: BHR-PD
Filing Date: 2025-03-31
Form Type: 8-K
Source: 0001574085-25-000027
Chunk: 1

Company: Braemar Hotels & Resorts Inc.
Filing Date: 2025-03-31
Form: 8-K
Item: Item 8.01
Chunk 1
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 is the ratio of the adjusted market capitalization to the total liquidation preference for all of our outstanding preferred securities, was adequate as of the Valuation Date.

Direct capitalization analysis. Stanger applied an estimated range of capitalization rates to our net operating income to determine an estimated range of real estate values, deducted our indebtedness, and adjusted for available working capital and for estimated non-controlling interests due to third parties as of the Valuation Date to derive an estimate of our equity value (before accounting for the preferred securities). Using the highest and lowest capitalization rates in Stanger’s range, our equity value exceeded the total liquidation preference for all of our outstanding preferred securities as of the Valuation Date.

Third-party appraisals. Stanger prepared an estimate of equity value based upon the most recent appraised values of our assets (on an “as is” basis), deducted our indebtedness, and adjusted for available working capital and for estimated non-controlling interests due to third parties as of the Valuation Date to derive an estimate of our equity value (before accounting for the preferred securities). Using the “as is” values, our equity value exceeded the total liquidation preference for all of our outstanding preferred securities.

Stanger is engaged in the business of providing valuation services for real estate assets and consulting services for non-traded REITs and their sponsors as well as for other real estate programs. Stanger has previously provided valuation services to us, most recently as of December 31, 2023, for which Stanger was paid normal and customary compensation, none of which was contingent upon their findings. In addition, Stanger has also provided financial advisory and consulting services to the Company and Ashford Securities LLC, a subsidiary of Ashford Inc., since 2019 and has received normal and customary fees in connection with those services. As previously disclosed, we provide funds to Ashford Inc. in connection with the formation, registration and operations of Ashford Securities LLC.

Limitations of Estimated Liquidation Value per Share

As with any valuation methodology, the methodologies used to assess the estimated liquidation value per share are based upon a number of estimates and assumptions that may not be accurate or complete. Different parties with different assumptions and estimates or methodologies could derive different estimated liquidation values per share, and this difference could be significant. The estimated liquidation value per share of each of the Series E Preferred Stock and the Series M Preferred Stock are not audited and do not represent a determination of the fair value of our assets or liabilities based on U