Business Context and Reporting Period
This Form 8-K is filed by Ashford Hospitality Prime, Inc. (not Braemar Hotels & Resorts Inc.) for the reporting period of July 9, 2015. The filing reports the completion of a strategic asset acquisition.
Key Financial Metrics and Transaction Details
- Asset Acquired: Bardessono Inn & Spa in Yountville, California.
- Total Purchase Price: $85 million in cash.
- Price Per Key: $1.37 million.
- Funding Sources: Proceeds from the 5.50% Series A Cumulative Convertible Preferred Stock offering (closed June 2015), cash on hand, and $2.0 million in key money provided by Ashford Inc.
Material Changes
The primary material change is the addition of the Bardessono Inn & Spa to the Company's portfolio. The filing incorporates historical audited financial statements for the acquired entity for the years ended December 31, 2014 and 2013, as well as unaudited statements for the three months ended March 31, 2015. Unaudited pro forma financial information reflecting the acquisition is also included as an exhibit.
Guidance, Outlook, and Risks
The filing does not provide specific forward-looking guidance, management commentary on future performance, or a detailed discussion of risks beyond the standard incorporation of the Acquisition Agreement. The transaction was executed pursuant to an agreement dated June 11, 2015.
Investor Verification Checklist
- Verify the impact of the $85 million cash outflow on the Company's current liquidity position.
- Review Exhibit 99.1 for the historical financial performance of the Bardessono Inn & Spa.
- Examine Exhibit 99.2 for unaudited pro forma financial information to understand the combined entity's financial position.
- Confirm the terms of the 5.50% Series A Cumulative Convertible Preferred Stock used to fund the acquisition.