Braemar Hotels & Resorts Inc DEFA14A, filed Nov 10, 2026
Braemar Hotels & Resorts Inc. (BHR)
Braemar Hotels & Resorts Inc. completed its transition to self-management on November 10, 2026, terminated its advisory agreement with Ashford and appointed seven new independent directors whose service becomes effective upon proxy statement filing. AI summary
UNITED
STATES
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): November 10, 2026
BRAEMAR HOTELS & RESORTS INC.
(Exact name of registrant as specified in its charter)
| Maryland | 001-35972 | 46-2488594 | ||
| (State or other jurisdiction of incorporation or organization) | (Commission File Number) | (IRS employer identification number) |
| 14001 Dallas Parkway | ||
| Suite 1100 | ||
| Dallas | ||
| Texas | 75240 | |
| (Address of principal executive offices) | (Zip code) |
Registrant’s telephone number, including area code: (972) 868-7616
14185 Dallas Parkway
Suite 1200
Dallas, Texas 75254
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| x | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
|
Common Stock |
BHR | New York Stock Exchange | ||
| Preferred Stock, Series B | BHR-PB | New York Stock Exchange | ||
| Preferred Stock, Series D | BHR-PD | New York Stock Exchange |
INTRODUCTORY NOTE
This Current Report on Form 8-K is being filed by Braemar Hotels & Resorts Inc. (the “Company” or “Braemar”) in connection with the completion of the Company’s transition to self-management as an internally managed real estate investment trust (“REIT”). Following the conclusion of a lengthy strategic review process and upon the recommendation of a Special Committee of the Board of Directors (the “Board”) comprised solely of independent directors (the “Special Committee”), the Board approved a plan for the Company to become a self-managed REIT, which included taking steps to terminate the advisory agreement with the Advisor, directly hiring the Company’s management team (including Richard J. Stockton), and reconstituting the Board with new independent directors. The events described herein occurred on or around November 10, 2026, in connection with the consummation of such transition.
| ITEM 1.01 | ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT |
Termination and Release Agreement
On November 10, 2026, the Company and certain of its affiliates (collectively, the “Braemar Parties”) entered into a Termination and Release Agreement (the “Termination Agreement”) with Ashford Inc. (“Ashford”) and certain of its affiliates party thereto (collectively, the “Ashford Parties”). Ashford and Ashford Hospitality Advisors LLC are referred to collectively herein as the “Advisor.”
The Termination Agreement relates to the termination of the Fifth Amended and Restated Advisory Agreement, dated as of April 23, 2018, as amended, most recently by Amendment No. 3 dated May 21, 2026 (the “Advisory Agreement”), and the Letter Agreement dated August 26, 2025, as amended on December 22, 2025 (the “Letter Agreement”). Under the Letter Agreement, the Advisor agreed to accept a negotiated Company Sale Fee in lieu of, and as payment in full of, the full termination payment otherwise payable under the Advisory Agreement and the Letter Agreement (the “Full Termination Payment”). The Advisory Agreement would terminate upon consummation of a Company Sale Transaction and payment of the Company Sale Fee, Accrued Fees and Master Agreement Termination Fee (collectively, the “Termination Payments”). In connection with the termination, the Company was also required to reimburse Ashford for expenses due and payable under Section 5 of the Advisory Agreement, and Ashford was required to remit money collected and held for the Company’s account, subject to permitted deductions, under Section 12.5(d) of the Advisory Agreement (collectively, the “Settlement Amounts”). The Company paid Ashford the agreed estimated net Settlement Amounts (the “Expense Reimbursement”), subject to the reconciliation described below.
A Company Sale Transaction was consummated on July 14, 2026 upon the sale of the Ritz-Carlton Sarasota (Sarasota, Florida), the Hotel Yountville (Yountville, California) and the Bardessono Hotel and Spa (Yountville, California). This sale triggered the Company Sale Fee under the Advisory Agreement, and the Company incurred a related liability of $480.0 million (before accrued fees) during the third quarter of 2026. The Company subsequently paid $173.0 million to the Advisor to pay down a portion of the Company Sale Fee. On August 12, 2026, the Company completed the sale of the Pier House Resort & Spa for a purchase price of $190.5 million in cash, subject to customary pro-rations and adjustments, and the Company subsequently paid $92.0 million to the Advisor to further pay down the Company Sale Fee. On October 28, 2026, the Company completed the sale of the Four Seasons Resort Scottsdale at Troon North for a purchase price of $372.0 million in cash, subject to customary pro-rations and adjustments. The remaining balance of the Termination Payments and the Expense Reimbursement were paid to Ashford in full simultaneously with the execution of the Termination Agreement on November 10, 2026, immediately following which the Advisory Agreement and the Letter Agreement terminated (other than certain surviving provisions described below). The Company did not sell all or substantially all of its assets.
The Master Agreement Termination Fee paid to Ashford was $25.0 million. The Company and the Advisor also agreed to waive the sixty (60) day notice period required by Section 1 of the Letter Agreement Amendment in connection with the Advisory Agreement termination, and as a result, the Advisor forfeited any fees that would otherwise have accrued and been payable to the Advisor during such notice period had it not been so waived.
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Effective immediately following Ashford’s receipt of the Termination Payments and the Expense Reimbursement (the “Effective Time”), the parties terminated and canceled the Advisory Agreement, the Letter Agreement and the other contracts listed on Annex I to the Termination Agreement (collectively, the “Terminating Contracts”), subject to the surviving provisions specified in Annex I, and waived applicable notice, cure, waiting and similar procedural requirements. For the contracts listed in items 3 through 18 of Annex I, provisions intended by their terms to survive termination remain in effect. The terminated contracts include the Amended and Restated Braemar Hotel Master Management Agreement, dated as of August 8, 2018, as amended (the “Braemar Master Hotel Management Agreement”). The Braemar Master Project Management Agreement, dated as of August 8, 2018, as amended (the “Braemar Master Project Management Agreement”), continues solely as an accommodation to the Company, at its request, to complete capital expenditure projects commenced before the date of the Termination Agreement in the most efficient and cost-effective manner. The Company may terminate that agreement in its sole discretion upon five (5) days’ prior written notice to Ashford and payment to Ashford of all outstanding amounts accrued but unpaid for services rendered thereunder as of the termination date.
Sections 8.1, 8.3, 9.5, 10, 11 and 12.6 of the Advisory Agreement and Section 5 of the Letter Agreement survive termination in accordance with their terms. The non-solicitation restriction in Section 12.6 does not apply to the solicitation or hiring of employees transferring from the Ashford Parties or their affiliates to the Braemar Parties or their affiliates as of the agreement date in connection with the Company’s transition to self-management.
At the Effective Time, each of the Braemar Parties and the Ashford Parties, on behalf of itself and its affiliates, irrevocably and unconditionally released the other parties and their affiliates and their respective related persons, including directors, officers, employees and equityholders, from all claims, known or unknown, based on events occurring before the Effective Time, and agreed not to assert such claims. The Ashford Parties also released their own past and present directors and officers. The releases exclude claims arising under or relating to the Termination Agreement, the surviving provisions of the Terminating Contracts specified in Annex I, and contracts between the Braemar Parties and the Ashford Parties that are not Terminating Contracts. Released persons who are not parties to the Termination Agreement are intended third-party beneficiaries entitled to enforce the releases and related terms.
The Termination Agreement provides for reciprocal indemnification of the released parties for breaches of the parties’ covenants or obligations, including direct and third-party claims. It also requires advancement of expenses actually incurred or reasonably estimated by a third-party advisor within five (5) business days after receipt of a request. Advances are unsecured and interest-free, continue until a final, nonappealable adjudication of entitlement to indemnification, and are subject to repayment to the extent indemnification is ultimately unavailable. The Termination Agreement further provides that, if the Company commences or intervenes to pursue directly an action or proceeding against any Ashford Party challenging the validity or enforceability of the Termination Agreement, the Advisory Agreement or the Letter Agreement or any provision thereof, challenging the amount or payment of the Termination Payments, or seeking recoupment of any portion of the Termination Payments, the Advisor is entitled to recover from the Company the amount by which the Full Termination Payment exceeds the Company Sale Fee. This provision does not apply to an action or proceeding commenced by a Company stockholder, directly or derivatively, so long as the Company does not intervene to pursue it directly against an Ashford Party, or to an expense reconciliation proceeding under Section 9(c) of the Termination Agreement.
The Settlement Amounts were based on good faith estimates. The parties agreed to negotiate in good faith to reconcile those estimates to actual amounts received or paid after the Effective Time within sixty (60) days after the date of the Termination Agreement (the “Reimbursement Deadline”). If the parties cannot agree on the resulting net amount (the “Final Expense Reimbursement”), they must submit their proposed statements and supporting detail within thirty (30) days after the Reimbursement Deadline to BDO USA, LLP or another mutually selected independent accounting firm for determination within ninety (90) days after the Reimbursement Deadline. That determination is final and binding absent manifest error, actual and intentional fraud, or willful misconduct. Any difference between the Expense Reimbursement and the Final Expense Reimbursement must be paid by the applicable party within three (3) business days after determination by agreement or by the accounting firm. The accounting firm’s costs are allocated in proportion to the amounts unsuccessfully disputed by each party. Submission of a matter to the accounting firm in accordance with the Termination Agreement does not constitute a breach of, or challenge to, the Termination Agreement, the Advisory Agreement or the Letter Agreement.
The foregoing description of the Termination Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Termination Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K (this “Current Report”) and is incorporated herein by reference.
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ITEM 1.02 TERMINATION OF A MATERIAL DEFINITIVE AGREEMENT
The information set forth in Item 1.01 above is incorporated herein by reference in its entirety.
The Advisory Agreement terminated effective November 10, 2026. As noted above, the Braemar Master Hotel Management Agreement terminated, subject to surviving provisions, and the Braemar Master Project Management Agreement continues on a transitional basis, terminable by Braemar at any time upon five (5) days’ prior written notice to Ashford, together with payment of all amounts accrued and unpaid for services rendered thereunder in the ordinary course of business. The Company currently expects that the Braemar Master Project Management Agreement will terminate in the first quarter of 2027.
ITEM 5.01 CHANGES IN CONTROL OF REGISTRANT
The information in Items 1.01, 1.02 and 5.02 of this Current Report is incorporated by reference herein. The Advisory Agreement terminated effective November 10, 2026, ending the Advisor’s contractual management role, subject to the surviving provisions and transitional arrangements described therein, as well as the Advisor’s right to designate two director candidates for the Company’s Board, as contained in the Company’s Articles of Amendment and Restatement (the “Charter”).
On November 10, 2026, six incumbent directors submitted resignations and the Board appointed seven new independent directors, all to become effective upon the filing of the Company’s definitive proxy statement on Schedule 14A (the “Proxy Statement”), as described in Item 5.02. Richard J. Stockton will remain a director, President and Chief Executive Officer. As of this filing, the Proxy Statement has not been filed and the Board changes have not become effective.
The advisory termination and Board reconstitution, when effective, may be deemed to constitute a change in control because they terminate or alter any contractual rights previously exercised by the Advisor, Ashford Inc., Monty J. Bennett or their affiliates, as well as the full transition of the Board. The Company has not identified any particular person or group as acquiring control through these events; the potential change concerns governance authority rather than acquisition of controlling voting ownership.
No voting securities are being issued or transferred in these transactions. As of the date of this filing, the incoming directors do not have any beneficial ownership of the Company’s voting securities. No incoming director or other person paid consideration or used funds to acquire control. The Company’s payments to the Ashford Parties satisfy contractual termination and related obligations, as described in Items 1.01 and 1.02, rather than consideration paid by an acquirer of control.
Except as described in the incorporated disclosures, there are no arrangements or understandings among former or new control persons or groups and their associates concerning director elections or other matters. The pending Board changes described above may subsequently result in a change in control. The Company knows of no other arrangements, including securities pledges, that may subsequently result in a change in control.
ITEM 5.02 DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS
Departing Directors and Officers
In connection with the Company’s transition to self-management, each of the following directors submitted resignations from the Board of Directors on November 10, 2026, effective as of the filing of the Proxy Statement:
| · | Monty J. Bennett, Chairman |
| · | Mary Candace Evans |
| · | Matthew D. Rinaldi |
| · | Rebeca Odino-Johnson |
| · | Kellie Sirna |
| · | Eric Batis |
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Each of the foregoing directors has confirmed that his or her decision to resign was not the result of any disagreement with the Company on any matter relating to the Company’s operations, policies, or practices.
James Plohg, who served as Executive Vice President, General Counsel and Secretary of the Company, resigned from his role effective as of November 10, 2026, in connection with the Company’s transition to self-management.
Appointment of New Directors
On November 10, 2026, the Board of Directors appointed the following seven (7) new independent directors to serve on the Board of Directors, effective upon the filing of the Proxy Statement: Craig A. Barbarosh, Kevin Covey, Stephen Haggerty, Daniel J. Hirsch, Kevin Luebbers, Gail P. Steinel, and Stephen W. Theriot. All current directors, other than Mr. Stockton, submitted their resignations on November 10, 2026, effective upon the filing of the Proxy Statement. The result is a new Board with no existing or prior relationships with the Company’s former advisor or Monty J. Bennett, other than Mr. Stockton.
After the filing of the Proxy Statement, it is expected that Stephen Haggerty will be appointed as the independent Chair of the Board. We expect that the committee assignments will be as follows: the Audit Committee of the Board will be comprised of Gail P. Steinel, Kevin Luebbers, and Stephen W. Theriot, with Ms. Steinel serving as Chair; the Compensation Committee of the Board will be comprised of Craig A. Barbarosh, Kevin Covey, and Daniel J. Hirsch, with Mr. Hirsch serving as Chair; and the Nominating and Corporate Governance Committee of the Board will be comprised of Kevin Luebbers, Stephen W. Theriot, and Craig A. Barbarosh, with Mr. Barbarosh serving as Chair. The Company’s compensation consultant has recommended to the new board a compensation package comprised of the following: an annual cash retainer of $75,000 payable quarterly in arrears, with the initial installment paid at the end of the first quarter of 2027 and a prorated payment for partial service during the fourth quarter of 2026; and an annual equity award for shares of the Company’s common stock with a grant date value of $75,000 that will vest on the earlier of the first anniversary of the grant date or the date immediately prior to the next annual meeting of stockholders, subject to each director’s continued service through such vesting date and stockholder approval of the Company’s new equity incentive plan. The Company’s compensation consultant has further recommended to the new board that the Chair of the Board or the Chair of a committee should receive an additional annual cash retainer, payable quarterly in arrears, as follows: the Chair of the Board shall receive $50,000; the Chair of the Audit Committee shall receive $20,000; and the chairs of the Compensation Committee and the Nominating and Corporate Governance Committee shall each receive $15,000.
We expect the new board will adopt the recommended compensation package during the first board meeting which is expected to occur promptly after the filing of the Proxy Statement.
Each of the newly appointed directors is expected to enter into the Company’s standard form indemnification agreement promptly following their appointment. Other than these indemnification agreements, none of the seven (7) new independent directors has any arrangement or understanding between with any other person or the Company pursuant to which such director was selected as a director. None of the directors has a direct or indirect material interest in any transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K.
Craig A. Barbarosh
Mr. Barbarosh served as Senior Managing Director of CommonWealth Partners LLC, a vertically integrated real estate investment, development and management firm with approximately $8.0 billion of assets under management, from October 2023 to September 2026, where he co-led the firm’s special situations investment strategy. Prior to joining CommonWealth Partners, Mr. Barbarosh was a partner at Katten Muchin Rosenman LLP from 2012 to 2023, where he served as a member of the firm’s Board of Directors and Executive and Operating Committee and led its California restructuring practice. During his legal career, Mr. Barbarosh has been involved in more than 200 restructuring matters across a broad range of industries. From 1992 to 2012, Mr. Barbarosh was an associate and subsequently a partner at Pillsbury Winthrop Shaw Pittman LLP, where he served as a member of the firm’s Board of Directors, chair of its Board Strategy Committee, Managing Partner of its Orange County office and chair of its National Restructuring Practice.
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Mr. Barbarosh has extensive public and private company board experience. He has served as a member of the Board of Directors of Evolent Health, Inc. (NYSE: EVH) since 2020, where he currently serves as chair of the Strategy Committee and as a member of the Compensation Committee, and as a member of the Board of Directors of Sabra Health Care REIT, Inc. (NASDAQ: SBRA) since 2010, where he currently serves as chair of the Audit Committee and as a member of the Compensation Committee. Mr. Barbarosh previously served as Vice Chairman of NextGen Healthcare, Inc. (NASDAQ: NXGN) from 2009 to 2023 and as Chairman of the Board of Lifecore Biomedical, Inc. (NASDAQ: LFCR) from 2019 to 2023. He has also served as a director of numerous other public and private companies, frequently in connection with restructurings, insolvencies and other special situations.
Mr. Barbarosh received a Juris Doctor, with honors, from the University of the Pacific, McGeorge School of Law and a Bachelor of Arts degree in Business Economics from the University of California, Santa Barbara. He has also completed executive education programs in corporate valuation at The Wharton School of the University of Pennsylvania, cybersecurity oversight at Carnegie Mellon University and corporate boards, strategic business valuation and private equity and venture capital at Harvard Business School.
Kevin Covey
Mr. Covey is the founder and Managing Partner of GrayStreet Partners and its predecessor, Caliburn Capital, which he founded in 2009. Mr. Covey is an investor, entrepreneur and real estate developer whose experience spans real estate, private credit, special situations, bankruptcy restructuring, litigation finance, hospitality and energy. His investment experience has also included outdoor advertising, electronics manufacturing, alternative lending and debt investments.
Mr. Covey has significant experience in special-situations investing, including as a lender, investor and acquirer in bankruptcy restructurings, distressed transactions and negotiated workouts. His experience includes providing capital to businesses undergoing reorganization, acquiring distressed assets and creditor interests, structuring recapitalizations and investing in litigation and claims-related opportunities. Through his private credit and investment activities, Mr. Covey has developed financing arrangements and investment vehicles across multiple asset classes, with responsibilities including investment sourcing, underwriting, capital allocation, transaction structuring and ongoing investment oversight.
Real estate investment, development and ownership have been a significant part of Mr. Covey’s career. His experience includes acquisitions, redevelopment, adaptive reuse, hospitality investment and the repositioning of existing properties. Mr. Covey is also an active principal in Ithaca Investments, Ltd., which owns more than 1.2 million square feet of retail shopping center space in Texas. In addition, he serves as manager of Grizzly Asset Management, the financial sponsor of the Grizzly Fund, which focuses on acquiring high-yield and non-performing debt instruments.
Mr. Covey received a degree in Economics from the University of Chicago.
Stephen Haggerty
Mr. Haggerty is the Principal and Founder of Bare Hill Advisory, a multi-strategy real estate investment and advisory platform focused on hospitality and wellness-related assets, which he founded in 2021. From May 2018 to October 2021, Mr. Haggerty served as Managing Partner of Trinity Investments, a private investment platform focused on hospitality real estate and related assets. Prior to joining Trinity Investments, Mr. Haggerty spent approximately 11 years at Hyatt Hotels Corporation in several senior leadership positions. From 2014 to 2018, he served as Global Head of Franchising, Select Service and Capital Strategy; from 2012 to 2014, he served as Global Head of Real Estate and Capital Strategy; and from 2007 to 2012, he served as Global Head of Real Estate and Development.
Prior to joining Hyatt, Mr. Haggerty spent approximately 13 years at Marriott International in a number of increasingly senior positions. From 2005 to 2007, he served as Senior Vice President, Global Asset Management in London; from 2003 to 2005, he served as Senior Vice President, Global Asset Management; from 1997 to 2003, he served as Vice President, Development for the Asia-Pacific region; and from 1994 to 1997, he served as Vice President, Feasibility. Earlier in his career, Mr. Haggerty held positions with HVS International.
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Mr. Haggerty served as a member of the Board of Directors of Broadmark Realty Capital Inc. (NYSE: BRMK) from November 2019 to July 2023, where he served as chair of the Compensation Committee, and as a member of the Board of Directors of Playa Hotels & Resorts (NASDAQ: PLYA) from 2013 to 2018. He also served as a member of the Board of Directors of B. Riley Securities from April 2025 to May 2026. Mr. Haggerty currently serves as a board member of Simply Resorts & Retreats, a founding member of the advisory board of Parafin and a Senior Advisor and Managing Director of Devotio Capital Management.
Daniel J. Hirsch
Mr. Hirsch has served as an Executive-in-Residence at Anzu Partners, LLC, a venture capital firm focused on industrial and life science technology companies, since August 2022. From August 2022 to September 2023, Mr. Hirsch also served as Chief Financial Officer and a director of Anzu Special Acquisition Corp I (NASDAQ: ANZU), a special purpose acquisition company. From August 2020 to May 2022, he served as Chief Operating Officer and Chief Financial Officer of Cascade Acquisition Corp. (NYSE: CAS-U), a special purpose acquisition company focused on the financial services sector. From 2018 to 2025, Mr. Hirsch was a principal of KRDH Holdings, LLC, a venture focused on the acquisition, entitlement and development of multifamily real estate projects. From 2017 to 2020, Mr. Hirsch served as a consultant, including advising Farallon Capital Management, L.L.C. with respect to its investment in Playa Hotels & Resorts and Trinity Real Estate Investments, LLC in connection with a special purpose acquisition company transaction.
From 2003 to 2016, Mr. Hirsch held several increasingly senior positions at Farallon Capital Management, L.L.C., including Managing Member, Managing Director and Legal Counsel. From 2013 to 2016, he co-led Farallon’s Real Estate Group, where he helped manage the firm’s real estate team and served as a member of its investment committee. His responsibilities included evaluating acquisition opportunities, negotiating transactions and joint ventures, asset and portfolio management, fundraising and structuring investment vehicles. From 2009 to 2012, Mr. Hirsch worked with Farallon’s Real Estate Group on the management and restructuring of a $3.5 billion real estate equity portfolio spanning multiple property sectors. Earlier in his tenure at Farallon, he worked on the negotiation, structuring and execution of private and public market debt and equity transactions across investment strategies in the United States and internationally. Prior to joining Farallon, Mr. Hirsch was an associate at Covington & Burling from 2001 to 2003, where he worked on corporate transactions in the public and private debt and equity markets.
Mr. Hirsch has extensive public company board experience. He has served as a member of the Board of Directors of Macerich (NYSE: MAC) since June 2018 and currently serves as a member of its Compensation Committee and Capital Allocation Committee and previously served as chair of its Nominating and Corporate Governance Committee. He previously served as a director of Ready Capital Corporation (NYSE: RC) from 2023 to 2024; Broadmark Realty Capital (NYSE: BRMK) from 2019 to 2023, where he served as chair of the Nominating and Corporate Governance Committee and as a member of the Compensation and Finance Committees; and Playa Hotels & Resorts (NASDAQ: PLYA) from 2010 to 2020, where he served as chair of the Compensation Committee and as a member of the Nominating and Corporate Governance and Capital Allocation Committees. Mr. Hirsch also served as a director of Nuburu Inc. (NYSE American: BURU) from 2023 to 2025 and Anzu Special Acquisition Corp I from 2022 to 2023. He currently serves as a member of the advisory board of Shore Capital Real Estate Partners.
Mr. Hirsch received a Juris Doctor from Yale Law School and a Bachelor of Arts degree, summa cum laude, from Amherst College.
Kevin Luebbers
Mr. Luebbers co-founded and has served as a partner of VIC Partners, LLC, an investment partnership focused on acquiring and repositioning hotel properties, since 2004. From 2000 to 2003, Mr. Luebbers served as Executive Vice President and Chief Financial Officer of RFS Hotel Investors, Inc., a publicly traded real estate investment trust, where he was responsible for the company’s capital markets and treasury functions. From 1996 to 2000, he served as Senior Vice President of Planning and Investment Analysis at Hilton Hotels Corporation.
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Mr. Luebbers served as a member of the Board of Directors of Ready Capital Corporation, a publicly traded multi -strategy real estate finance company, from 2023 to 2024. From 2019 to 2023, he served as a member of the Board of Directors and chair of the Audit Committee of Broadmark Realty Capital, a publicly traded specialty real estate finance company. From 2005 to 2008, Mr. Luebbers served as a member of the Board of Directors and chair of the Audit Committee of Ambassadors International, Inc., a publicly traded cruise, marina, travel and events company.
Mr. Luebbers received a Bachelor of Science degree from Cornell University and a Master of Business Administration from the University of California, Berkeley.
Gail P. Steinel
Ms. Steinel currently serves as a Senior Advisor to Alvarez & Marsal’s Global Transaction Advisory Group and its U.S. Corporate Transactions Group, which provide financial and operational due diligence services to private equity firms and corporations. She also serves as a Senior Advisor to Nichols Law, a government contracts law firm. Ms. Steinel began her career as an auditor with Arthur Andersen and subsequently held a number of leadership positions with the firm, ultimately serving as Global Managing Partner of its Business Consulting Group. In that role, she led approximately 10,000 professionals across 85 countries providing strategy, people, process and technology services to clients across a broad range of industries. Following the dismantling of Arthur Andersen, Ms. Steinel led a complex series of global transactions and group hires that resulted in approximately 8,000 professionals joining KPMG Consulting, which was subsequently renamed BearingPoint.
Ms. Steinel has approximately 20 years of public and private company board experience. She has served as a member of the Board of Trustees of Federal Realty Investment Trust (NYSE: FRT) since 2006, where she currently serves as chair of the Audit Committee and as a member of the Compensation Committee. She has also served as a member of the Board of Directors of Invesque Corporation (TSX: IVQ) since 2021, where she serves as chair of the Audit Committee and as a member of the Compensation and Nominating Committees. Ms. Steinel has served as a director of DAI Corporation since 2006 and has served as chair of its Audit Committee. From 2009 to 2020, she served as a director of MTS Systems Corporation (NASDAQ: MTSC), where she served as chair of the Audit Committee prior to the company’s acquisition by Amphenol Corporation. In 2025, Ms. Steinel was named by The Wall Street Journal as one of its Top 250 Board Members, recognizing influential and effective directors of S&P 500 companies.
Ms. Steinel received a Bachelor of Science degree in Accounting from Rutgers University. She has also served as a guest lecturer on leadership in crisis at Yale University, Harvard University, the United States Military Academy at West Point and Villanova University.
Stephen W. Theriot
Mr. Theriot is a seasoned finance executive with over 40 years of experience in a variety of senior roles demonstrating expertise in leading large, complex operations, capital allocation strategies, and corporate governance for publicly traded companies.
From 2017 to 2021, Mr. Theriot served as the Chief Financial Officer of JBG SMITH Properties, a NYSE listed REIT and an S&P 400 company that owns, operates, invests in and develops a portfolio of mixed-use properties in and around Washington, D.C. A member of JBG SMITH’s senior leadership team, he was responsible for the accounting, tax, investor relations and information technology functions. In conjunction with the spin-off of JBG SMITH from Vornado Realty Trust in 2017, Mr. Theriot directed the development of its stand-alone accounting, tax and information technology teams and processes. From 2021 to 2022, Mr. Theriot served as a Senior Advisor to JBG SMITH’s leadership team, where he provided advice and counsel on strategic and financial matters.
From 2013 to 2017, Mr. Theriot served as Chief Financial Officer of Vornado Realty Trust where he directed the accounting, tax, investor relations and information technology functions of the multi-billion-dollar S&P 500 REIT. His key achievements included serving as the deal captain for Vornado’s spin-off of its Washington, DC segment and the formation JBG SMITH. He also helped direct the spin-off of Vornado’s strip shopping center segment into Urban Edge Properties.
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Prior to joining Vornado, he spent approximately 30 years in Deloitte’s Audit & Assurance group, culminating in his appointment as Partner in charge of Deloitte’s Northeast Region Real Estate Practice. He specialized in service to a wide range of real estate businesses, including REITs, home builders, hospitality and gaming enterprises. From 2004 to 2013, he also served as Deputy Professional Practice Director and advised clients on the application of GAAP and SEC regulations to complex transactions, including merger and acquisition and capital market transactions. He also served as the Partner in charge of Deloitte’s Atlanta/Birmingham Audit & Assurance practices from 1998 to 2003.
Mr. Theriot has served as a Senior Advisor to Plumbrook Capital Partners, a real estate investment firm focused on middle-market multifamily real estate investments, since 2024. He has also served as a member of the Board of Directors of the Treasury Department Federal Credit Union in Washington, DC since 2023, including serving as Vice Chairman from 2024 to 2026.
Mr. Theriot received a Bachelor of Science degree from the University of North Carolina at Chapel Hill.
Appointment of Officers
The following descriptions do not purport to be complete descriptions of the terms and conditions of the employment agreements, and are qualified in their entirety by reference to the full text of the respective agreements, copies of which are filed as Exhibits to this Current Report.
Appointment of President and Chief Executive Officer — Richard J. Stockton
Richard J. Stockton was appointed to the Board of Directors in July 2020. From 2016 until November 2026, Mr. Stockton was employed by Ashford Inc. Mr. Stockton has served as our Chief Executive Officer since November 2016 and as President since April 2017. He also served as the Lead Independent Director of Spirit MTA REIT (NYSE: SMTA) and Trustee of its successor entity, SMTA Liquidating Trust, from 2018 to 2025. Prior to joining our Company, Mr. Stockton served as Global Co-Head and Global Chief Operating Officer for Real Estate at CarVal Investors, a subsidiary of Cargill Inc., with real estate investments in the United States, Canada, the United Kingdom and France. He also previously served as President & CEO-Americas for OUE Limited, a publicly listed Singaporean property company, where he established the business that acquired and refurbished the US Bank Tower in Los Angeles in 2013. The majority of his career, over 15 years, was spent at Morgan Stanley in real estate investment banking in various roles including Head of EMEA Real Estate Banking in London, where he was responsible for business across Europe, the Middle East and Africa and Co-Head of Asia Pacific Real Estate Banking, where he was responsible for a team across Hong Kong, Singapore, Sydney and Mumbai. He is also a member of the Board of the American Hotel and Lodging Association. Mr. Stockton is a frequent speaker and panelist at industry conferences and events, including NAREIT, the NYU International Hospitality Industry Investment Conference, and the Americas Lodging Investment Summit. He is a dual citizen of the United States and the United Kingdom. Mr. Stockton received a Master’s of Business Administration degree in Finance and Real Estate from The Wharton School, University of Pennsylvania, and a Bachelor of Science degree from Cornell University, School of Hotel Administration.
Mr. Stockton will continue to serve as President and Chief Executive Officer of the Company and as a member of the Board of Directors. In connection with the Company’s transition to self-management, the Company entered into a new employment agreement with Mr. Stockton (the “Stockton Employment Agreement”), dated November 10, 2026, including a termination of his prior employment agreement with Ashford Inc. The Stockton Employment Agreement and the related termination of the Ashford Inc. employment agreement are filed as Exhibits 10.2 and 10.3, respectively, to this Current Report and are incorporated herein by reference.
There are no arrangements or understandings between Mr. Stockton and any other person pursuant to which he was appointed as President and Chief Executive Officer, other than as described herein. Mr. Stockton does not have any family relationship with any director, executive officer or person nominated to become a director or executive officer of the Company. Mr. Stockton has no direct or indirect material interest in any transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K other than his prior service at Ashford Inc.
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Appointment of Chief Financial Officer, Chief Accounting Officer, and Treasurer — Justin R. Coe
Effective November 10, 2026, the Board of Directors of the Company appointed Justin R. Coe, age 43, as Chief Financial Officer, Chief Accounting Officer, and Treasurer of the Company.
Mr. Coe serves as the Chief Financial Officer, Chief Accounting Officer, and Treasurer of Braemar Hotels & Resorts Inc. and brings more than 20 years of experience in accounting, financial reporting, corporate finance, and capital markets. Mr. Coe joined Ashford Inc. in 2015, previously serving as Senior Vice President of Accounting, before becoming a direct employee of BHR Luxury Hotels Management, LLC effective November 10, 2026 in connection with the Company’s transition to self-management. In his current role, he oversees the finance, accounting, tax, internal audit, information systems, and financial reporting functions for the Company. He also works closely with executive leadership and the Board of Directors on debt and equity capital markets activities, financial planning and analysis, acquisitions, and other strategic initiatives. Prior to joining Ashford, Mr. Coe spent nearly a decade with Ernst & Young LLP, ultimately serving as a Senior Manager for public and private companies across a variety of industries, including real estate, airlines, and medical devices, in both domestic and international markets. Mr. Coe earned a Bachelor of Business Administration and a Master of Accountancy from Texas State University and is a Certified Public Accountant in the State of Texas.
In connection with his appointment, the Company entered into an employment agreement with Mr. Coe, dated November 10, 2026, a copy of which is filed as Exhibit 10.4 to this Current Report and is incorporated herein by reference. Additionally, Mr. Coe entered into a separation agreement with Ashford Inc., a copy of which is filed as Exhibit 10.5 to this Current Report and is incorporated herein by reference.
There are no arrangements or understandings between Mr. Coe and any other person pursuant to which he was appointed as Chief Financial Officer, Chief Accounting Officer, and Treasurer, other than as described herein. Mr. Coe does not have any family relationship with any director, executive officer or person nominated to become a director or executive officer of the Company. Mr. Coe has no direct or indirect material interest in any transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K other than his prior service as Senior Vice President of Accounting from 2015 to 2026 as described above.
Appointment of Chief Legal Officer and Secretary — Robert G. Haiman
Effective November 10, 2026, the Board of Directors of the Company appointed Robert G. Haiman, age 58, as Chief Legal Officer and Secretary of the Company.
Mr. Haiman is the Company’s Chief Legal Officer and Secretary. From 2021 through 2026, Mr. Haiman served as Founder and Owner of The Law Office of Robert G. Haiman, Esq., where he represented real estate owners and developers, including family offices, in a range of commercial real estate projects. Mr. Haiman previously served as Executive Vice President, General Counsel and Secretary of the Company, Ashford Trust and Ashford Inc. from 2018 to 2021. Prior to joining the Company in 2018, Mr. Haiman spent 14 years at Remington Lodging, where he oversaw a variety of legal and business initiatives for one of the largest third-party hotel management companies in the country, most recently serving as Remington Lodging’s Chief Legal Officer. From 1996 through 2004, Mr. Haiman was a real estate attorney in the Dallas office of Gibson, Dunn & Crutcher LLP. Mr. Haiman holds a B.A. degree from Amherst College and a J.D. from Duke University School of Law.
In connection with his appointment, the Company entered into an employment agreement with Mr. Haiman, dated November 10, 2026, a copy of which is filed as Exhibit 10.6 to this Current Report and is incorporated herein by reference.
There are no arrangements or understandings between Mr. Haiman and any other person pursuant to which he was appointed as Chief Legal Officer and Secretary, other than as described herein. Mr. Haiman does not have any family relationship with any director, executive officer or person nominated to become a director or executive officer of the Company. Mr. Haiman has no direct or indirect material interest in any transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K, other than his prior service as Executive Vice President, General Counsel and Secretary of the Company, Ashford Trust and Ashford Inc. from 2018 to 2021 as described above.
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New Executive Employment Agreements
On November 10, 2026, BHR Luxury Hotels Management, LLC and the Company entered into employment agreements with Richard J. Stockton, the Company’s President and Chief Executive Officer; Justin R. Coe, the Company’s Chief Financial Officer, Chief Accounting Officer, and Treasurer; and Robert G. Haiman, the Company’s Chief Legal Officer and Secretary (the “Employment Agreements”). The Employment Agreements have an initial term ending November 9, 2029, which will automatically renew for additional one-year terms unless the Company or the executive gives notice of non-renewal at least sixty (60) days prior to the expiration of the then-current term.
Base Salary and Bonus. The Employment Agreements provide each executive with an initial annual base salary, which is $725,000 for Mr. Stockton, and $450,000 for Messrs. Coe and Haiman. Each executive will also be entitled to an annual bonus opportunity, with specified threshold, target and maximum performance levels set as a percentage of each executive’s annual base salary. Mr. Stockton has a threshold bonus opportunity equal to 75% of his annual base salary, a target bonus opportunity equal to 150% of his annual base salary and a maximum bonus opportunity equal to 175% of his annual base salary, while Messrs. Coe and Haiman have threshold bonus opportunities equal to 50% of each executive’s annual base salary, target bonus opportunities equal to 100% of each executive’s annual base salary and a maximum bonus opportunity equal to 150% of each executive’s annual base salary. Each executive’s actual annual bonus (if any) will become payable based on the applicable performance level that is achieved each year as determined by the Company’s Compensation Committee.
Equity Awards. Pursuant to the Employment Agreements, each executive will be eligible to participate in the Company’s long-term incentive or other equity incentive plans applicable to similarly situated executives. The Employment Agreements do not entitle any executive to receive any specific equity awards, and no awards were issued, in connection with each executive’s appointment.
Severance Terms. If the Company terminates an executive’s employment without cause or determines not to renew an Employment Agreement at the end of the initial or any extended term, or if the executive resigns for good reason (each as defined in the Employment Agreement), the executive will be entitled to receive, in addition to accrued obligations: (i) a lump sum severance payment equal to a multiple of the executive’s annual base salary plus average incentive bonus earned over the prior three (3)completed years (or such lesser number of completed years the executive was employed), with the multiple for Mr. Stockton being equal to three (3) and the multiple for Messrs. Coe and Haiman equal to two (2); (ii) reimbursement of the costs of continued medical coverage under COBRA for up to twenty-four (24) months (the “COBRA Benefits”); (iii) after the end of the year in which the termination occurs, payment of a pro-rata bonus based on actual performance for the year of termination (but no less than a pro-rata portion of the executive’s target bonus); and (iv) full acceleration of all outstanding time based equity awards and pro-rata accelerated vesting of all outstanding performance based awards (with such pro-rata performance based awards to vest at the greater of target or the level earned based on actual performance). Lesser severance benefits are payable upon an executive’s termination due to death or disability.
The Employment Agreements do not provide for any enhanced severance benefits for a qualifying termination in connection with a change in control of the Company. However, if an executive resigns without good reason or determines not to renew the Employment Agreement, the executive will be entitled to the COBRA Benefits and a payment equal to the executive’s annual base salary plus average incentive bonus earned over the prior three (3) completed years (or such lesser number of completed years the executive was employed), with payment payable in substantially equal installments over a period of twelve (12) months subject to the executive’s compliance with the restrictive covenants contained in the Employment Agreements. In consideration of an executive’s receipt of any severance benefits under the Employment Agreement, and as a precondition to their receipt, the executive must execute and deliver, and not revoke, a release in favor of the Company in substantially the form attached to the Employment Agreement.
The Employment Agreements require the executives to comply with non-competition and non-solicitation restrictions that last for one (1) year following the executive’s termination of employment.
The foregoing description of the Employment Agreements is qualified in its entirety by reference to the full text of the agreements, which are filed as Exhibits 10.2, 10. 4 and 10.6 to this Current Report on Form 8-K and are incorporated by reference herein.
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ITEM 5.03 AMENDMENTS TO ARTICLES OF INCORPORATION OR BYLAWS; CHANGE IN FISCAL YEAR
Charter Amendments — Articles of Amendment
The Board of Directors approved Articles of Amendment (the “Articles of Amendment”) amending the Company’s Charter. The Company expects to file the Articles of Amendment with the Maryland State Department of Assessments and Taxation, following approval by stockholders at the Company’s 2026 annual meeting of stockholders. The Board believes the amendments modernize the Company’s Charter, enhance shareholder rights and provide a more streamlined and flexible corporate governance framework that better reflects the Company’s current circumstances.
Elimination of Supermajority Voting Requirement
The Board determined that the supermajority voting requirement contained in Article VI, Section 9 of the Charter is no longer necessary or appropriate and that eliminating this heightened voting standard would enhance stockholder rights and better align the Charter with contemporary corporate governance practices. Article VI, Section 9 previously required the affirmative vote of holders of at least two-thirds of all votes entitled to be cast to approve amendments to Article VI of the Charter, which contains provisions principally designed to protect the Company’s qualification as a REIT, including limitations on the ownership and transfer of the Company’s capital stock and related provisions governing exceptions, administration and enforcement of those limitations.
The Articles of Amendment eliminate this supermajority voting requirement and provide that future amendments to Article VI may be approved by the affirmative vote of holders of a majority of the votes entitled to be cast on the matter. The amendment does not itself modify the substantive ownership and transfer restrictions contained in Article VI, including the provisions designed to protect the Company’s qualification as a real estate investment trust for U.S. federal income tax purposes. Rather, the amendment modifies only the voting standard applicable to future amendments to Article VI.
Other Governance Amendments
The Board undertook a review of the Company’s Charter and determined that certain provisions should be updated to simplify and modernize the Company’s governance framework and provide the Company with greater flexibility to respond to changing circumstances. The Articles of Amendment effect the following specific changes to the Charter:
| · | Article V, Section 7 — Approval of Extraordinary Actions. The amendment updates this provision to remove the reference to actions “permitting or” requiring a greater proportion of votes such that any such action shall be effective and valid if declared advisable by the Board of Directors and taken or approved by the affirmative vote of holders of shares entitled to cast a majority of all the votes entitled to be cast on the matter. |
| · | Article VII, Section 3 — Number and Terms of Directors. The amendment removes the fixed number of seven (7) directors and replaces it with a flexible formulation whereby the number of directors shall be fixed from time to time and may be increased or decreased pursuant to the Bylaws, but shall never be less than the minimum number required by the Maryland General Corporation Law. The amendment also removes the legacy list of named directors who served until the first annual meeting of stockholders. |
| · | Article VII, Section 4 — Nominations of Director Candidates. The amendment removes the provision that, for so long as Ashford Hospitality Advisors LLC, or its successor in interest, was acting as the external advisor of the Company, the Company was required to include two persons designated by the Advisor as candidates for election as director at any stockholders meeting at which directors were to be elected, and all related provisions governing the Advisor’s director nomination rights. This provision is no longer applicable following the termination of the Advisory Agreement. |
A copy of the Articles of Amendment is filed as Exhibit 3.2 to this Current Report and is incorporated herein by reference.
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Bylaws Amendments — Sixth Amended & Restated Bylaws
As part of its ongoing commitment to strong corporate governance, the Board approved several amendments to the Company’s Bylaws (the “Sixth Amended & Restated Bylaws”) designed to enhance stockholder rights, strengthen director accountability and modernize the Company’s governance framework. The material amendments to the Company’s Bylaws are as follows:
Uniform Quorum Requirement
The Sixth Amended & Restated Bylaws eliminate the prior provision that set a lower quorum of one-third of all the votes entitled to be cast at an annual meeting of stockholders called by the Board of Directors for any matter proposed by the Board of Directors. The uniform quorum requirement is now the presence in person or by proxy of stockholders entitled to cast a majority of all the votes entitled to be cast at such meeting on any matter.
Director Responsiveness — Majority Voting and Resignation Policy
The Sixth Amended & Restated Bylaws provide that if, in any election of directors of the Company which is not a contested election, an incumbent director does not receive the affirmative vote of a majority of the votes cast for such nominee in the election of directors, such incumbent director shall promptly tender his or her resignation as a director, and the Nominating and Corporate Governance Committee will promptly accept any such tendered resignation. This change strengthens director accountability by ensuring that an incumbent director who does not receive majority support from stockholders will promptly tender their resignation and no longer continue to serve on the Board.
Modernized Advance Notice Provisions
The Board updated and streamlined the Company’s advance notice provisions to provide greater clarity and appropriate transparency regarding stockholder nominations and proposals, while narrowing certain disclosure requirements. Specifically, the advance notice window for annual meeting nominations and proposals has been updated from 90 days/60 days prior to the anniversary date of the prior year’s annual meeting to 120 days/90 days prior to such anniversary date, and conforming changes have been made to the provisions applicable to special meetings.
Expanded Proxy Access
The maximum percentage of directors that may be subject to proxy access nominations has been increased from 20% to 25% of the total number of directors of the Corporation on the last day on which a Nomination Notice may be submitted pursuant to the proxy access provisions (rounded down to the nearest whole number). This provides eligible long-term stockholders a greater opportunity to nominate director candidates through the Company’s proxy materials.
Refined Procedural Requirements and Disclosure Obligations
The Board removed certain procedural requirements, thereby providing for more meaningful participation in the Company’s governance. Among other changes, the disclosure obligations for Stockholder Associated Persons in connection with stockholder proposals have been streamlined by removing the requirement to provide presentations, documents or marketing materials containing performance, personnel or investment thesis information with respect to the Corporation, and narrowing the requirement to a copy of the prospectus, offering memorandum or similar document, if any, provided to third parties to solicit an investment in such stockholder and each such Stockholder Associated Person. In addition, the definition of “Stockholder Associated Person” has been narrowed to remove references to persons forming groups with stockholders for the purpose of acquiring, holding, voting or disposing of Company Securities and related provisions.
The Board believes these enhancements meaningfully strengthen the Company’s governance practices and further align the Company’s governance framework with the interests of its stockholders.
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The Sixth Amended & Restated Bylaws became effective on November 10, 2026. A copy of the Sixth Amended & Restated Bylaws is filed as Exhibit 3.1 to this Current Report and is incorporated herein by reference.
ITEM 5.05 AMENDMENTS TO THE REGISTRANT’S CODE OF ETHICS, OR WAIVER OF A PROVISION OF THE CODE OF ETHICS
In connection with the Company’s transition to self-management effective November 10, 2026, the Board of Directors adopted an amended and restated Code of Business Conduct and Ethics (the “Code of Ethics”) and a separate Code of Ethics for the Chief Executive Officer and Chief Financial Officer (the “Senior Officer Code of Ethics”).
The Company’s Code of Ethics applies to each of the Company’s directors, officers and employees. Effective November 10, 2026, in connection with the termination of the Advisory Agreement with the former advisor and the Company’s transition to self-management, the Company’s executive officers became direct employees of the Company. The term “officers and employees” includes individuals who: (i) are employed directly by the Company; or (ii) prior to November 10, 2026, were employed by the former advisor or its subsidiaries and: (a) had been named one of the Company’s officers by the Board; or (b) had been designated as subject to the Code of Ethics by the legal department of the former advisor.
Among other matters, the Code of Ethics is designed to deter wrongdoing and to promote: honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest; full, fair, accurate, timely and understandable disclosure in reports filed with the SEC and other public communications; compliance with applicable governmental laws, rules and regulations; prompt internal reporting of violations of the Code of Ethics to appropriate persons identified therein; protection of Company assets, including corporate opportunities and confidential information; and accountability for compliance with the Code of Ethics.
Any waiver of the Code of Ethics for executive officers or directors may be made only by the Board or one of the Board committees and will be promptly disclosed if and to the extent required by law or stock exchange regulations.
The amendments to the Code of Ethics and the adoption of the Senior Officer Code of Ethics were necessary to reflect the transition to a self-managed REIT structure in which all officers and employees are direct employees of the Company, rather than employees of the Company’s former advisor or its affiliates. No waiver of the Code of Ethics was granted in connection with these amendments.
Copies of the Code of Ethics and the Senior Officer Code of Ethics are filed as Exhibits 14.1 and 14.2 to this Current Report and are incorporated herein by reference.
IMPORTANT INFORMATION FOR INVESTORS AND STOCKHOLDERS
CERTAIN INFORMATION REGARDING PARTICIPANTS
Braemar and its directors and certain of its executive officers will be deemed to be “participants” (as defined in Schedule 14A under the Securities Exchange Act of 1934, as amended) in the solicitation of proxies from the Company’s stockholders by Braemar in connection with the matters to be considered at Braemar’s 2026 Annual Meeting of Stockholders. Information regarding the names of Braemar’s executive officers and directors and their respective interests in Braemar by security holdings or otherwise is set forth (i) in Braemar’s proxy statement for the 2025 Annual Meeting of Stockholders, which was filed with the SEC on: October 30, 2025 (the “2025 Proxy Statement”), which is available here, including under the headings “SUMMARY”, “PROPOSAL NUMBER ONE-ELECTION OF DIRECTORS”, “CORPORATE GOVERNANCE”, “BOARD OF DIRECTORS AND COMMITTEES”, “EXECUTIVE OFFICERS”, “EXECUTIVE COMPENSATION”, “PROPOSAL NUMBER TWO-ADVISORY APPROVAL OF EXECUTIVE COMPENSATION”, “SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS” and “CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS”; and (ii) under Item 1.01 “ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT” in the Current Reports on Form 8-K filed by Braemar with the SEC on December 23, 2025 (available here), on March 17, 2026 (available here), on April 3, 2026 (available here) and on May 22, 2026 (available here), under Item 5.02 “DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS” in the Current Reports on Form 8-K filed by Braemar with the SEC on February 25, 2026 (available here), on February 27, 2026 (available here), on March 6, 2026 (available here), on March 17, 2026 (available here) and on May 28, 2026 (available here), under Item 5.07 “SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS” in the Current Report on Form 8-K filed by Braemar with the SEC on December 16, 2025 (available here) and under Item 8.01 “OTHER EVENTS” in the Current Report on Form 8-K filed by Braemar with the SEC on June 1, 2026 (available here). To the extent holdings of such persons in the Company’s securities have changed since the amounts described in the 2025 Proxy Statement, such changes have been reflected on Initial Statements of Beneficial Ownership on Form 3 or Statements of Change in Ownership on Form 4 filed with the SEC, by James A. Plohg on December 22, 2025 (available here), by James A. Plohg on January 14, 2026 (available here), by Monty J. Bennett on February 26, 2026 (available here), by Richard J. Stockton on February 26, 2026 (available here) and by Eric Batis on June 1, 2026 (available here). Additional information can also be found in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the SEC on March 12, 2026 (available here), as amended by the Amendment No. 1 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (available here). Details concerning the nominees of Braemar’s Board of Directors for election at the 2026 Annual Meeting will be included in the Proxy Statement. These documents, including the definitive Proxy Statement (and any amendments or supplements thereto) and other documents filed by the Company with the SEC, are or will be available free of charge at the SEC’s website at www.sec.gov. Copies of the documents filed by Braemar are also available free of charge by accessing the “SEC Filings” section of the Company’s website at www.braemar.q4ir.com/investor/financials-sec-filings/sec-filings/. Further information regarding the participants in the proxy solicitations and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the Proxy Statement.
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IMPORTANT INFORMATION AND WHERE TO FIND IT
Braemar Hotels & Resorts Inc. (the “Company” or “Braemar”) intends to file a proxy statement and GOLD proxy card and other relevant documents with the U.S. Securities and Exchange Commission (the “SEC”) in connection with its solicitation of proxies from the Company’s stockholders for Braemar’s 2026 Annual Meeting of Stockholders (the “Proxy Statement”). This communication is neither a solicitation of a proxy nor a substitute for any proxy statement or other document that Braemar may file with the SEC in connection with any solicitation by Braemar. BRAEMAR STOCKHOLDERS ARE URGED TO READ THE PROXY STATEMENT (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) FILED BY BRAEMAR AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC WHEN THEY BECOME AVAILABLE CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Stockholders may obtain copies of these documents and other documents filed with the SEC by Braemar free of charge through the website maintained by the SEC at www.sec.gov. Copies of the documents filed by Braemar are also available free of charge by accessing the “SEC Filings” section of the Company’s website at www.braemar.q4ir.com/investor/financials-sec-filings/sec-filings/.
ITEM 7.01 REGULATION FD
Termination of the Advisory Agreement
On November 10, 2026, the Company issued a press release (the “Termination Press Release”) announcing the termination of the Advisory Agreement and the other information disclosed in this Current Report.
CMBS Loan
On November 10, 2026, the Company issued a press release (the “CMBS Press Release”) announcing the closing of a new $358.0 million CMBS loan secured by The Ritz-Carlton St. Thomas, The Ritz-Carlton Reserve Dorado Beach, The Notary Hotel and Sofitel Chicago Magnificent Mile. The loan is interest-only, has a two-year initial term with three one-year extension options, subject to certain conditions, taking the final maturity to November 2031 and provide for a floating interest rate of SOFR +2.37%. The new loan replaces two existing CMBS loans with combined outstanding balances of approximately $290.4 million as of September 30, 2026. The loan secured by The Ritz-Carlton St. Thomas, with a balance of approximately $80.5 million, carried a spread of SOFR + 4.91% and had a final maturity of August 2029. The loan secured by The Ritz-Carlton Reserve Dorado Beach, The Notary Hotel and Sofitel Chicago Magnificent Mile, with a balance of approximately $209.9 million, carried a spread of SOFR + 2.83% and had a final maturity of March 2030. Together, the refinancing reduces the weighted-average spread on the loans for these four hotels by approximately 104 basis points, from approximately 3.41% to approximately 2.37%, while also extending the final maturities. The $358.0 million loan balance is $42.0 million lower than the $400.0 million estimated in the Company’s October 2026 investor presentation.
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Copies of the press releases are attached hereto as Exhibit 99.1 and 99.2, respectively, and are incorporated herein by reference. The information in this Item 7.01 and Exhibit 99.1 and Exhibit 99.2 attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall they be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS
(d) Exhibits.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| BRAEMAR HOTELS & RESORTS INC. | ||
| Dated: November 10, 2026 | By: | /s/ Robert G. Haiman |
| Robert G. Haiman | ||
| Title: Chief Legal Officer and Secretary | ||
Exhibit 3.1
BRAEMAR HOTELS & RESORTS INC.
SIXTH AMENDED AND RESTATED BYLAWS
November 10, 2026
BRAEMAR HOTELS & RESORTS INC.
SIXTH AMENDED AND RESTATED BYLAWS
ARTICLE I
STOCKHOLDERS
Section 1. Place. All meetings of stockholders shall be held at the principal executive office of Braemar Hotels & Resorts Inc. (the “Corporation”) or at such other place as shall be set by the Board of Directors (the “Board”) in accordance with these Bylaws and stated in the notice of the meeting.
Section 2. Annual Meeting. An annual meeting of stockholders for the election of directors and the transaction of any business within the powers of the Corporation shall be held on the date and at the time and place set by the Board of Directors.
Section 3. Special Meetings.
(a) General. Each of the Chairman of the Board, Chief Executive Officer and Board of Directors may call a special meeting of stockholders. Except as provided in subsection (b)(4) of this Section 3, a special meeting of stockholders shall be held on the date and at the time and place set by the Chairman of the Board, Chief Executive Officer or Board of Directors, whoever has called the meeting. Subject to subsection (b) of this Section 3, a special meeting of stockholders shall also be called by the secretary of the Corporation to act on any matter that may properly be considered at a meeting of stockholders upon the written request of stockholders entitled to cast not less than a majority of all the votes entitled to be cast on such matter at such meeting.
(b) Stockholder-Requested Special Meetings.
(1) Any stockholder of record seeking to have stockholders request a special meeting shall, by sending written notice to the secretary (the “Record Date Request Notice”) by registered mail, return receipt requested, request the Board of Directors to fix a record date to determine the stockholders entitled to request a special meeting (the “Request Record Date”). The Record Date Request Notice shall set forth the purpose of the meeting and the matters proposed to be acted on at it, shall be signed by one or more stockholders of record as of the date of signature (or their agents duly authorized in a writing accompanying the Record Date Request Notice), shall bear the date of signature of each such stockholder (or such agent) and shall set forth all information relating to each such stockholder and each matter proposed to be acted on at the meeting that would be required to be disclosed in connection with the solicitation of proxies for the election of directors in an election contest (even if an election contest is not involved), or would otherwise be required in connection with such a solicitation, in each case pursuant to Regulation 14A (or any successor provision) under the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder (the “Exchange Act”). Upon receiving the Record Date Request Notice, the Board of Directors may fix a Request Record Date. The Request Record Date shall not precede and shall not be more than ten days after the close of business on the date on which the resolution fixing the Request Record Date is adopted by the Board of Directors. If the Board of Directors, within ten days after the date on which a valid Record Date Request Notice is received, fails to adopt a resolution fixing the Request Record Date, the Request Record Date shall be the close of business on the tenth day after the first date on which a Record Date Request Notice is received by the secretary.
(2) In order for any stockholder to request a special meeting to act on any matter that may properly be considered at a meeting of stockholders, one or more written requests for a special meeting (collectively, the “Special Meeting Request”) signed by stockholders of record (or their agents duly authorized in a writing accompanying the request) as of the Request Record Date entitled to cast not less than a majority of all of the votes entitled to be cast on such matter at such meeting (the “Special Meeting Percentage”) shall be delivered to the secretary. In addition, the Special Meeting Request shall (a) set forth the purpose of the meeting and the matters proposed to be acted on at it (which shall be limited to those lawful matters set forth in the Record Date Request Notice received by the secretary), (b) bear the date of signature of each such stockholder (or such agent) signing the Special Meeting Request, (c) set forth (i) the name and address, as they appear in the Corporation’s books, of each stockholder signing such request (or on whose behalf the Special Meeting Request is signed), (ii) the class, series and number of all shares of stock of the Corporation which are owned (beneficially or of record) by each such stockholder and (iii) the nominee holder for, and number of, shares of stock of the Corporation owned beneficially but not of record by such stockholder, (d) be sent to the secretary by registered mail, return receipt requested, and (e) be received by the secretary within 30 days after the Request Record Date. Any requesting stockholder (or agent duly authorized in a writing accompanying the revocation of the Special Meeting Request) may revoke his, her or its request for a special meeting at any time by written revocation delivered to the secretary.
(3) The secretary shall inform the requesting stockholders of the reasonably estimated cost of preparing and mailing or delivering the notice of the meeting (including the Corporation’s proxy materials). The secretary shall not be required to call a special meeting upon stockholder request and such meeting shall not be held unless, in addition to the documents required by paragraph (2) of this Section 3(b), the secretary receives payment of such reasonably estimated cost prior to the preparation and mailing or delivery of such notice of the meeting.
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(4) In the case of any special meeting called by the secretary upon the request of stockholders (a “Stockholder-Requested Meeting”), such meeting shall be held at such place, date and time as may be designated by the Board of Directors; provided, however, that the date of any Stockholder-Requested Meeting shall be not more than 90 days after the record date for such meeting (the “Meeting Record Date”); and provided further that if the Board of Directors fails to designate, within ten days after the date that a valid Special Meeting Request is actually received by the secretary (the “Delivery Date”), a date and time for a Stockholder-Requested Meeting, then such meeting shall be held at 2:00 p.m., local time, on the 90th day after the Meeting Record Date or, if such 90th day is not a Business Day (as defined below), on the first preceding Business Day; and provided further that in the event that the Board of Directors fails to designate a place for a Stockholder-Requested Meeting within ten days after the Delivery Date, then such meeting shall be held at the principal executive office of the Corporation. In fixing a date for a Stockholder-Requested Meeting, the Board of Directors may consider such factors as it deems relevant, including, without limitation, the nature of the matters to be considered, the facts and circumstances surrounding any request for the meeting and any plan of the Board of Directors to call an annual meeting or a special meeting. In the case of any Stockholder-Requested Meeting, if the Board of Directors fails to fix a Meeting Record Date that is a date within 30 days after the Delivery Date, then the close of business on the 30th day after the Delivery Date shall be the Meeting Record Date. The Board of Directors may revoke the notice for any Stockholder-Requested Meeting in the event that the requesting stockholders fail to comply with the provisions of paragraph (3) of this Section 3(b).
(5) If written revocations of the Special Meeting Request have been delivered to the secretary and the result is that stockholders of record (or their agents duly authorized in writing), as of the Request Record Date, entitled to cast less than the Special Meeting Percentage have delivered, and not revoked, requests for a special meeting on the matter to the secretary: (i) if the notice of meeting has not already been delivered, the secretary shall refrain from delivering the notice of the meeting and send to all requesting stockholders who have not revoked such requests written notice of any revocation of a request for a special meeting on the matter, or (ii) if the notice of meeting has been delivered and if the secretary first sends to all requesting stockholders who have not revoked requests for a special meeting on the matter written notice of any revocation of a request for the special meeting and written notice of the Corporation’s intention to revoke the notice of the meeting or for the chairman of the meeting to adjourn the meeting without action on the matter, (A) the secretary may revoke the notice of the meeting at any time before ten days before the commencement of the meeting or (B) the chairman of the meeting may call the meeting to order and adjourn the meeting without acting on the matter. Any request for a special meeting received after a revocation by the secretary of a notice of a meeting shall be considered a request for a new special meeting.
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(6) The Chairman of the Board, Chief Executive Officer or Board of Directors may appoint regionally or nationally recognized independent inspectors of elections to act as the agent of the Corporation for the purpose of promptly performing a ministerial review of the validity of any purported Special Meeting Request received by the secretary. For the purpose of permitting the inspectors to perform such review, no such purported Special Meeting Request shall be deemed to have been received by the secretary until the earlier of (i) five Business Days after actual receipt by the secretary of such purported request and (ii) such date as the independent inspectors certify to the Corporation that the valid requests received by the secretary represent, as of the Request Record Date, stockholders of record entitled to cast not less than the Special Meeting Percentage. Nothing contained in this paragraph (6) shall in any way be construed to suggest or imply that the Corporation or any stockholder shall not be entitled to contest the validity of any request, whether during or after such five Business Day period, or to take any other action (including, without limitation, the commencement, prosecution or defense of any litigation with respect thereto, and the seeking of injunctive relief in such litigation).
(7) For purposes of these Bylaws, “Business Day” shall mean any day other than a Saturday, a Sunday or a day on which banking institutions in the State of New York are authorized or obligated by law or executive order to close.
Section 4. Notice. A written notice of all annual meetings of stockholders stating the hour, date and place of such annual meetings and, to the extent required by the Maryland General Corporation Law, the purpose for which the meeting has been called shall be given by the Secretary or an Assistant Secretary (or other person authorized by these Bylaws or by law) not less than 10 days nor more than 90 days before the meeting, unless any provisions of the Maryland General Corporation Law prescribe a different period of notice, to each stockholder entitled to vote at such meeting or to each stockholder who, under the Corporation’s charter, as amended from time to time (the “Charter”) or under these Bylaws, is entitled to such notice, by delivering such notice, by mailing it, postage prepaid, addressed to such stockholder at the address of such stockholder as it appears on the Corporation’s stock transfer books, by electronic transmission or by any other means permitted by Maryland law. If mailed, such notice shall be deemed to be given when deposited in the United States mail addressed to the stockholder at the stockholder’s address as it appears on the records of the Corporation, with postage thereon prepaid. If transmitted electronically, such notice shall be deemed to be given when transmitted to the stockholder by an electronic transmission to any address or number of the stockholder at which the stockholder receives electronic transmissions. The Corporation may give a single notice to all stockholders who share an address, which single notice shall be effective as to any stockholder at such address, unless such stockholder objects to receiving such single notice or revokes a prior consent to receiving such single notice. Failure to give notice of any meeting to one or more stockholders, or any irregularity in such notice, shall not affect the validity of any meeting fixed in accordance with this Article I or the validity of any proceedings at any such meeting.
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Subject to Section 11(a) of this Article I, any business of the Corporation may be transacted at an annual meeting of stockholders without being specifically designated in the notice, except such business as is required by any statute to be stated in such notice. No business shall be transacted at a special meeting of stockholders except as specifically designated in the notice. The Corporation may postpone or cancel a meeting of stockholders by making a public announcement (as defined in Section 11(c)(3) of this Article I) of such postponement or cancellation prior to the meeting. Notice of the date, time and place to which the meeting is postponed shall be given not less than ten days prior to such date and otherwise in the manner set forth in this section.
Section 5. Organization and Conduct. Every meeting of stockholders shall be conducted by the Chairman of the Board or, in the case of a vacancy in the office or absence of the Chairman of the Board, by one of the following officers present at the meeting in the following order: the Vice Chairman of the Board, if there is one, the Chief Executive Officer, the President, the Vice Presidents in their order of rank and seniority, the Secretary, or, in the absence of such officers, a chairman chosen by the stockholders by the vote of a majority of the votes cast by stockholders present in person or by proxy. The Secretary, or, in the Secretary’s absence, an Assistant Secretary, or, in the absence of both the Secretary and Assistant Secretaries, an individual appointed by the Board of Directors or, in the absence of such appointment, an individual appointed by the chairman of the meeting shall act as secretary. In the event that the Secretary presides at a meeting of stockholders, an Assistant Secretary, or, in the absence of all Assistant Secretaries, an individual appointed by the Board of Directors or the chairman of the meeting, shall record the minutes of the meeting. The order of business and all other matters of procedure at any meeting of stockholders shall be determined by the chairman of the meeting. The chairman of the meeting may prescribe such rules, regulations and procedures and take such action as, in the discretion of the chairman and without any action by the stockholders, are appropriate for the proper conduct of the meeting, including, without limitation, (a) restricting admission to the time set for the commencement of the meeting; (b) limiting attendance at the meeting to stockholders of record of the Corporation, their duly authorized proxies and such other individuals as the chairman of the meeting may determine; (c) limiting participation at the meeting on any matter to stockholders of record of the Corporation entitled to vote on such matter, their duly authorized proxies and other such individuals as the chairman of the meeting may determine; (d) limiting the time allotted to questions or comments; (e) determining when and for how long the polls should be opened and when the polls should be closed; (f) maintaining order and security at the meeting; (g) removing any stockholder or any other individual who refuses to comply with meeting procedures, rules or guidelines as set forth by the chairman of the meeting; (h) concluding a meeting or recessing or adjourning the meeting to a later date and time and at a place announced at the meeting; and (i) complying with any state and local laws and regulations concerning safety and security. Unless otherwise determined by the chairman of the meeting, meetings of stockholders shall not be required to be held in accordance with the rules of parliamentary procedure.
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Section 6. Quorum. At any meeting of stockholders, the presence in person or by proxy of stockholders entitled to cast a majority of all the votes entitled to be cast at such meeting on any matter shall constitute a quorum. This section shall not affect any requirement under any statute or the charter of the Corporation for the vote necessary for the approval of any matter. If such quorum is not established at any meeting of the stockholders, the chairman of the meeting may adjourn the meeting sine die or from time to time to a date not more than 120 days after the original record date without notice other than announcement at the meeting. At such adjourned meeting at which a quorum shall be present, any business may be transacted which might have been transacted at the meeting as originally notified.
The stockholders present either in person or by proxy, at a meeting which has been duly called and at which a quorum has been established, may continue to transact business until adjournment, notwithstanding the withdrawal from the meeting of enough stockholders to leave fewer than would be required to establish a quorum.
Section 7. Voting. Directors of the Corporation shall be elected by a plurality of the votes cast at any meeting of stockholders at which directors are to be elected and at which a quorum is present; provided, however, subject to the stockholders’ approval of the amendment to the Corporation’s charter at the next meeting of the Corporation’s stockholders and the filing and acceptance for record of Articles of Amendment and Restatement implementing such amendment with the Maryland State Department of Assessments and Taxation, effective as of the date on which the Corporation’s stockholders approve the amendment to the Corporation’s charter, a nominee for director shall be elected to the Board of Directors if the votes cast for such nominee’s election exceed the votes cast against such nominee’s election (with “withholds,” “abstentions” and “broker nonvotes” not counted as a vote cast either “for” or “against” that nominee’s election); provided, however, that in the case of a contested election, directors shall be elected by a plurality of the votes cast (in which case stockholders shall not be permitted to cast votes against the election of directors). In the election of directors, each share may be voted for as many individuals as there are directors to be elected and for whose election the share is entitled to be voted. Cumulative voting is not permitted. For purposes of this Bylaw provision, a “contested election” shall mean any election of directors with respect to which (i) the Corporation receives notice that any stockholder has nominated an individual for election as a director in compliance with the requirements set forth in these Bylaws and (ii) all such nominations have not been withdrawn by such stockholder(s) on or prior to the date the Corporation first mails its notice of meeting for such meeting to the stockholders, and, as a result of which, there are more nominees than directorships.
A majority of the votes cast at a meeting of stockholders duly called and at which a quorum is present shall be sufficient to approve any other matter which may properly come before the meeting, unless more than a majority of the votes cast is required by law or by the charter of the Corporation. Unless otherwise provided by statute or by the charter, each outstanding share, regardless of class, shall be entitled to one vote on each matter submitted to a vote at a meeting of stockholders. Voting on any question or in any election may be viva voce unless the chairman of the meeting shall order that voting be by ballot or otherwise.
If, in any election of directors of the Corporation which is not a contested election, an incumbent director does not receive the affirmative vote of a majority of the votes cast for such nominee in the election of directors, such incumbent director shall promptly tender his or her resignation as a director. The Nominating and Corporate Governance Committee will promptly accept any such tendered resignation.
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Section 8. Proxies. A holder of record of shares of stock of the Corporation may cast votes in person or by proxy executed by the stockholder or by the stockholder’s duly authorized agent in any manner permitted by law. Such proxy or evidence of authorization of such proxy shall be filed with the secretary of the Corporation before or at the meeting. No proxy shall be valid more than eleven months after its date unless otherwise provided in the proxy.
Section 9. Voting of Stock by Certain Holders. Stock of the Corporation registered in the name of a corporation, partnership, trust, limited liability company or other entity, if entitled to be voted, may be voted by the president or a vice president, general partner, trustee or managing member thereof, as the case may be, or a proxy appointed by any of the foregoing individuals, unless some other person who has been appointed to vote such stock pursuant to a bylaw or a resolution of the governing body of such corporation or other entity or agreement of the partners of a partnership presents a certified copy of such bylaw, resolution or agreement, in which case such person may vote such stock. Any director or fiduciary may vote stock registered in the name of such person in the capacity of such director or fiduciary, either in person or by proxy.
Shares of stock of the Corporation directly or indirectly owned by it shall not be voted at any meeting and shall not be counted in determining the total number of outstanding shares entitled to be voted at any given time, unless they are held by it in a fiduciary capacity, in which case they may be voted and shall be counted in determining the total number of outstanding shares at any given time.
The Board of Directors may adopt by resolution a procedure by which a stockholder may certify in writing to the Corporation that any shares of stock registered in the name of the stockholder are held for the account of a specified person other than the stockholder. The resolution shall set forth the class of stockholders who may make the certification, the purpose for which the certification may be made, the form of certification and the information to be contained in it; if the certification is with respect to a record date, the time after the record date within which the certification must be received by the Corporation; and any other provisions with respect to the procedure which the Board of Directors considers necessary or desirable. On receipt by the Corporation of such certification, the person specified in the certification shall be regarded as, for the purposes set forth in the certification, the holder of record of the specified stock in place of the stockholder who makes the certification.
Section 10. Inspectors. The Board of Directors or the chairman of the meeting may appoint, before or at the meeting, one or more inspectors for the meeting and any successor to the inspector. Except as otherwise provided by the chairman of the meeting, the inspectors, if any, shall (i) determine the number of shares of stock represented at the meeting, in person or by proxy, and the validity and effect of proxies, (ii) receive and tabulate all votes, ballots or consents, (iii) report such tabulation to the chairman of the meeting, (iv) hear and determine all challenges and questions arising in connection with the right to vote, and (v) do such acts as are proper to fairly conduct the election or vote. Each such report shall be in writing and signed by the inspector or by a majority of them if there is more than one inspector acting at such meeting. If there is more than one inspector, the report of a majority shall be the report of the inspectors. The report of the inspector or inspectors on the number of shares represented at the meeting and the results of the voting shall be prima facie evidence thereof.
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Section 11. Advance Notice of Stockholder Nominees for Director and Other Stockholder Proposals.
(a) Annual Meetings of Stockholders.
(1) Nominations of individuals for election to the Board of Directors and the proposal of other business to be considered by the stockholders may be made at an annual meeting of stockholders (i) pursuant to the Corporation’s notice of meeting, (ii) by or at the direction of the Board of Directors, (iii) by any stockholder of the Corporation who was a stockholder of record both at the time of giving of notice by the stockholder as provided for in this Section 11(a) and at the time of the annual meeting, who is entitled to vote at the meeting in the election of each individual so nominated or on any such other business and who has complied with this Section 11(a), or (iv) by any Eligible Holder (as defined in Article I, Section 12 below) whose Nominee (as defined in Article I, Section 12 below) is included in the Corporation’s proxy materials for the relevant annual meeting. For the avoidance of doubt, the foregoing clauses (iii) and (iv) shall be the exclusive means for a stockholder to make director nominations, and the foregoing clause (iii) shall be the exclusive means for a stockholder to propose other business (other than a proposal included in the Corporation’s proxy materials pursuant to and in compliance with Exchange Act Rule 14a-8), at an annual meeting of stockholders.
(2) For any nomination or other business to be properly brought before an annual meeting by a stockholder pursuant to clause (iii) of paragraph (a)(1) of this Section 11, the stockholder must have given timely notice thereof in writing to the secretary of the Corporation and any such other business must otherwise be a proper matter for action by the stockholders. To be timely, a stockholder’s notice shall set forth all information required under this Section 11 and shall be delivered to the secretary at the principal executive office of the Corporation not earlier than the 120th day nor later than 5:00 p.m., Eastern Time, on the 90th day prior to the first anniversary of the date of the preceding year’s annual meeting; provided, however, that in the event that the date of the annual meeting is advanced or delayed by more than 30 days from the first anniversary of the date of the preceding year’s annual meeting, in order for notice by the stockholder to be timely, such notice must be so delivered not earlier than the 120th day prior to the date of such annual meeting and not later than 5:00 p.m., Eastern Time, on the later of the 90th day prior to the date of such annual meeting or the tenth day following the day on which public announcement of the date of such meeting is first made. The postponement or adjournment of an annual meeting, or the public announcement thereof, shall not commence a new time period for the giving of a stockholder’s notice as described above.
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(3) Such stockholder’s notice shall set forth:
(A) as to any business other than the nomination of an individual for election or reelection as a director that the stockholder proposes to bring before the meeting, a description of such business, the stockholder’s reasons for proposing such business at the meeting and any material interest in such business of such stockholder or any Stockholder Associated Person (as defined below), individually or in the aggregate, including any anticipated benefit to the stockholder or the Stockholder Associated Person therefrom;
(B) as to the stockholder giving notice and any Stockholder Associated Person, the information required pursuant to Rule 14a-19(b) promulgated under the Exchange Act if the stockholder, such Stockholder Associated Person or any of their respective affiliates, associates or others acting in concert intends to engage in a solicitation in support of director nominees other than the Corporation’s nominees;
(C) as to the stockholder giving the notice, any individual whom the stockholder proposes to nominate for election or reelection as a director (each, a “Proposed Nominee”) and any Stockholder Associated Person:
(i) the class, series and number of all shares of stock or other securities of the Corporation or any affiliate thereof (collectively, the “Company Securities”), if any, which are owned (beneficially or of record) by such stockholder, Proposed Nominee or Stockholder Associated Person, the date on which each such Company Security was acquired and the investment intent of such acquisition, and any short interest (including any opportunity to profit or share in any benefit from any decrease in the price of such stock or other security) in any Company Securities of any such person,
(ii) the nominee holder for, and number of, any Company Securities owned beneficially but not of record by such stockholder, Proposed Nominee or Stockholder Associated Person,
(iii) whether and the extent to which such stockholder, Proposed Nominee or Stockholder Associated Person, directly or indirectly (through brokers, nominees or otherwise), is subject to or during the last six months has engaged in any hedging, derivative or other transaction or series of transactions or entered into any other agreement, arrangement or understanding (including any short interest, any borrowing or lending of securities or any proxy or voting agreement), the effect or intent of which is to (I) manage risk or benefit from changes in the price of Company Securities for such stockholder, Proposed Nominee or Stockholder Associated Person or (II) increase or decrease the voting power of such stockholder, Proposed Nominee or Stockholder Associated Person in the Corporation or any affiliate thereof disproportionately to such person’s economic interest in the Company Securities, and
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(iv) any substantial interest, direct or indirect (including, without limitation, any existing or prospective commercial, business or contractual relationship with the Corporation), by security holdings or otherwise, of such stockholder, Proposed Nominee or Stockholder Associated Person, in the Corporation or any affiliate thereof, other than an interest arising from the ownership of Company Securities where such stockholder, Proposed Nominee or Stockholder Associated Person receives no extra or special benefit not shared on a pro rata basis by all other holders of the same class or series;
(D) as to the stockholder giving the notice, any Stockholder Associated Person with an interest or ownership referred to in clauses (i) or (iii) of paragraph (3)(C) of this Section 11(a) and any Proposed Nominee:
(i) the name and address of such stockholder, as they appear on the Corporation’s stock ledger, and the current name and business address, if different, of each such Stockholder Associated Person and any Proposed Nominee;
(ii) (i) a description of the investment strategy or objective, if any, of such stockholder and each such Stockholder Associated Person who is not an individual and (ii) a copy of the prospectus, offering memorandum or similar document, if any, provided to third parties (including investors and potential investors) to solicit an investment in such stockholder and each such Stockholder Associated Person ; and
(iii) all information relating to the stockholder, the Proposed Nominee or the Stockholder Associated Person that would be required to be disclosed in connection with the solicitation of proxies pursuant to Regulation 14A (or any successor provision) under the Exchange Act.
(E) the name and address of any person who contacted or was contacted by the stockholder giving the notice or any Stockholder Associated Person about the Proposed Nominee or other business proposal prior to the date of such stockholder’s notice and;
(F) to the extent known by the stockholder giving the notice, the name and address of any other stockholder supporting the nominee for election or reelection as a director or the proposal of other business on the date of such stockholder’s notice.
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(4) Such stockholder’s notice shall, with respect to any Proposed Nominee, be accompanied by a certificate executed by the Proposed Nominee (i) certifying that such Proposed Nominee (a) is not, and will not become, a party to any agreement, arrangement or understanding with any person or entity other than the Corporation in connection with service or action as a director that has not been disclosed to the Corporation and (b) will serve as a director of the Corporation if elected; and (ii) attaching a completed Proposed Nominee questionnaire (which questionnaire shall be provided by the Corporation, upon request, to the stockholder providing the notice and shall include all information relating to the Proposed Nominee that would be required to be disclosed in connection with the solicitation of proxies for the election of the Proposed Nominee as a director in an election contest (even if an election contest is not involved), or would otherwise be required in connection with such solicitation, in each case pursuant to Regulation 14A (or any successor provision) under the Exchange Act and the rules thereunder, or would be required pursuant to the rules of any national securities exchange on which any securities of the Corporation are listed or over-the-counter market on which any securities of the Corporation are traded).
(5) Notwithstanding anything in this subsection (a) of this Section 11 to the contrary, in the event that the number of directors to be elected to the Board of Directors is increased, and there is no public announcement of such action at least 130 days prior to the first anniversary of the date of the proxy statement (as defined in Section 11(c)(3) of this Article I) for the preceding year’s annual meeting, a stockholder’s notice required by this Section 1(a) shall also be considered timely, but only with respect to nominees for any new positions created by such increase, if it shall be delivered to the secretary at the principal executive office of the Corporation not later than 5:00 p.m., Eastern Time, on the tenth day following the day on which such public announcement is first made by the Corporation.
(6) For purposes of this Section 11, a “Stockholder Associated Person” of any stockholder shall mean any person (and such person’s affiliates and associates): (i) acting in concert with such stockholder; (ii) any beneficial owner of shares of stock of the Corporation owned of record or beneficially by such stockholder (other than a stockholder that is a depositary) or (iii) any person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such stockholder or such Stockholder Associated Person.
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(b) Special Meetings of Stockholders. Only such business shall be conducted at a special meeting of stockholders as shall have been brought before the meeting pursuant to the Corporation’s notice of meeting. Nominations of individuals for election to the Board of Directors may be made at a special meeting of stockholders at which directors are to be elected only (i) by or at the direction of the Board of Directors or (ii) provided that the special meeting has been called in accordance with Section 3(a) of this Article I for the purpose of electing directors, by any stockholder of the Corporation who is a stockholder of record both at the time of giving of notice provided for in this Section 11 and at the time of the special meeting, who is entitled to vote at the meeting in the election of each individual so nominated and who has complied with the notice procedures set forth in this Section 11. In the event the Corporation calls a special meeting of stockholders for the purpose of electing one or more individuals to the Board of Directors, any stockholder may nominate an individual or individuals (as the case may be) for election as a director as specified in the Corporation’s notice of meeting, if the stockholder’s notice, containing the information required by paragraphs (a)(3) and (4) of this Section 11, is delivered to the secretary at the principal executive office of the Corporation not earlier than the 120th day prior to such special meeting and not later than 5:00 p.m., Eastern Time, on the later of the 90th day prior to such special meeting or the tenth day following the day on which public announcement is first made of the date of the special meeting and of the nominees proposed by the Board of Directors to be elected at such meeting. The public announcement of a postponement or adjournment of a special meeting shall not commence a new time period for the giving of a stockholder’s notice as described above.
(c) General.
(1) If information submitted pursuant to this Section 11 by any stockholder proposing a nominee for election as a director or any proposal for other business at a meeting of stockholders shall be inaccurate in any material respect, such information may be deemed not to have been provided in accordance with this Section 11. Any such stockholder shall notify the Corporation of any inaccuracy or change (within two Business Days of becoming aware of such inaccuracy or change) in any such information. Upon written request by the secretary or the Board of Directors, any such stockholder shall provide, within five Business Days of delivery of such request (or such other period as may be specified in such request), (A) written verification, satisfactory, in the discretion of the Board of Directors or any authorized officer of the Corporation, to demonstrate the accuracy of any information submitted by the stockholder pursuant to this Section 11, and (B) a written update of any information (including, if requested by the Corporation, written confirmation by such stockholder that it continues to intend to bring such nomination or other business proposal before the meeting) submitted by the stockholder pursuant to this Section 11 as of an earlier date. If a stockholder fails to provide such written verification or written update within such period, the information as to which written verification or a written update was requested may be deemed not to have been provided in accordance with this Section 11.
(2) Only such individuals who are nominated in accordance with this Section 11 shall be eligible for election by stockholders as directors, and only such business shall be conducted at a meeting of stockholders as shall have been brought before the meeting in accordance with this Section 11. The chairman of the meeting shall have the power to determine whether a nomination or any other business proposed to be brought before the meeting was made or proposed, as the case may be, in accordance with this Section 11.
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(3) For purposes of this Section 11, “the date of the proxy statement” shall have the same meaning as “the date of the company’s proxy statement released to shareholders” as used in Rule 14a-8(e) promulgated under the Exchange Act, as interpreted by the Securities and Exchange Commission (the “SEC”) from time to time. “Public announcement” shall mean disclosure (A) in a press release reported by the Dow Jones News Service, Associated Press, Business Wire, PR Newswire or other widely circulated news or wire service or (B) in a document publicly filed by the Corporation with the SEC pursuant to the Exchange Act.
(4) Notwithstanding the foregoing provisions of this Section 11, (i) a stockholder shall also comply with all applicable requirements of state law and of the Exchange Act and the rules and regulations thereunder with respect to the matters set forth in this Section 11, (ii) no stockholder, Stockholder Associated Person, or any of their respective affiliates, associates and other persons acting in concert therewith shall solicit proxies in support of any nominees other than the nominees of the Board of Directors unless such person has complied with Rule 14a-19 promulgated under the Exchange Act in connection with the solicitation of such proxies, including the provision to the Corporation of notices required thereunder in a timely manner and (iii) if such stockholder, Stockholder Associated Person, or any of their respective affiliates, representatives or others acting in concert therewith (1) provides notice pursuant to Rule 14a-19(b) promulgated under the Exchange Act as required by Article I, Section 11(a)(3)(B) and (2) subsequently fails to comply with any of the requirements of Rule 14a-19 promulgated under the Exchange Act, then the Corporation shall disregard any proxies or votes solicited for such stockholder’s nominees. Upon request by the Corporation, if any stockholder, Stockholder Associated Person, or any of their respective affiliates, associates and other persons acting in concert therewith provides notice pursuant to Rule 14a-19(b) promulgated under the Exchange Act, such stockholder shall deliver to the Corporation, no later than five (5) business days prior to the applicable meeting, reasonable evidence that such stockholder, Stockholder Associated Person, and any of their respective affiliates, associates or other persons acting in concert therewith have met the requirements of Rule 14a-19 promulgated under the Exchange Act. Except to the extent provided by Rule 14a-19 promulgated under the Exchange Act with respect to a nomination made pursuant to Article I, Section 11(a) and that otherwise complies with the applicable provisions of these Bylaws, nothing in these Bylaws shall be construed to grant any stockholder the right to include or have disseminated or described in the Corporation’s proxy statement any such nomination of directors. Nothing in this Section 11 shall be deemed to affect any right of a stockholder to request inclusion of a proposal in, or the right of the Corporation to omit a proposal from, the Corporation’s proxy statement pursuant to Rule 14a-8 (or any successor provision) under the Exchange Act. Nothing in this Section 11 shall require disclosure of revocable proxies received by the stockholder or Stockholder Associated Person pursuant to a solicitation of proxies after the filing of an effective Schedule 14A by such stockholder or Stockholder Associated Person under Section 14(a) of the Exchange Act.
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Section 12. Proxy Access for Director Nominations.
(a) Inclusion of Stockholder Nominee in Proxy Materials. Subject to the provisions of this Section 12, if expressly requested in the relevant Nomination Notice (as defined below), the Corporation shall include in its proxy statement for any annual meeting of stockholders:
(1) the names of any person or persons nominated for election for whom notice is provided in accordance with this Section 12 (each such nominee, a “Stockholder Nominee”), which shall also be included on the Corporation’s form of proxy and ballot, by any Eligible Holder (as defined below) or group of up to 20 Eligible Holders that has (individually and collectively, in the case of a group) satisfied, as determined by the Board of Directors or any committee thereof, all applicable conditions and complied with all applicable procedures set forth in this Section 12 (such Eligible Holder or group of Eligible Holders being a “Nominating Stockholder”);
(2) disclosure about each Stockholder Nominee and the Nominating Stockholder required under the rules of the SEC in the proxy statement;
(3) any statement included by the Nominating Stockholder in the Nomination Notice for inclusion in the proxy statement in support of each Stockholder Nominee’s election to the Board of Directors (subject, without limitation, to Section 12(e)(2)), if such statement does not exceed 500 words and fully complies with Section 14 of the Exchange Act and the rules and regulations thereunder, including Rule 14a-9 (the “Supporting Statement”); and
(4) nothing in this Section 12 shall limit the Corporation’s ability to solicit against and include in its proxy materials any statement in opposition to the nomination, any of the information provided pursuant to this Section 12 and any solicitation materials or related information with respect to a Stockholder Nominee.
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For purposes of this Section 12, any determination to be made by the Board of Directors may be made by the Board of Directors, a committee of the Board of Directors or any officer of the Corporation designated by the Board of Directors or a committee of the Board of Directors, and any such determination shall be final and binding on the Corporation, any Eligible Holder, any Nominating Stockholder, any Stockholder Nominee and any other person so long as made in good faith (without any further requirements). The chairman of any annual meeting of stockholders, in addition to making any other determinations that may be appropriate to the conduct of the meeting, shall have the power and duty to determine whether a Stockholder Nominee has been nominated in accordance with the requirements of this Section 12 and, if not so nominated, shall direct and declare at the meeting that such Stockholder Nominee shall not be considered. This Section 12 shall be the exclusive method for stockholders to include nominees for Director election in the Corporation’s proxy materials.
(b) Maximum Number of Stockholder Nominees.
(1) The Corporation shall not be required to include in the proxy statement for an annual meeting of stockholders more Stockholder Nominees than that number of directors constituting the greater of (i) two or (ii) 25% of the total number of directors of the Corporation on the last day on which a Nomination Notice may be submitted pursuant to this Section 12 (rounded down to the nearest whole number) (the “Maximum Number”). The Maximum Number for a particular annual meeting shall be reduced by: (i) Stockholder Nominees who the Board of Directors itself decides to nominate for election at such annual meeting; (ii) Stockholder Nominees who cease to satisfy, or Stockholder Nominees of Nominating Stockholders that cease to satisfy, the eligibility requirements in this Section 12, as determined by the Board of Directors; (iii) Stockholder Nominees whose nomination is withdrawn by the Nominating Stockholder or who become unwilling to serve on the Board of Directors; and (iv) the number of incumbent directors who had been Stockholder Nominees with respect to any of the preceding two annual meetings of stockholders and whose reelection at the upcoming annual meeting is being recommended by the Board of Directors. In the event that one or more vacancies for any reason occurs on the Board of Directors after the deadline for submitting a Nomination Notice as set forth in Section 12(d) below but before the date of the annual meeting, and the Board of Directors resolves to reduce the size of the board in connection therewith, the Maximum Number shall be calculated based on the number of directors in office as so reduced.
(2) If the number of Stockholder Nominees pursuant to this Section 12 for any annual meeting of stockholders exceeds the Maximum Number then, promptly upon notice from the Corporation, each Nominating Stockholder will select one Stockholder Nominee for inclusion in the proxy statement until the Maximum Number is reached, going in order of the amount (largest to smallest) of the ownership position as disclosed in each Nominating Stockholder’s Nomination Notice and if the amount of the ownership position is tied, in the order of the date of the Nominating Stockholder’s Nomination Notice (earliest to latest), with the process repeated if the Maximum Number is not reached after each Nominating Stockholder has selected one Stockholder Nominee. If, after the deadline for submitting a Nomination Notice as set forth in Section 12(d), a Nominating Stockholder or a Stockholder Nominee ceases to satisfy the eligibility requirements in this Section 12, as determined by the Board of Directors, a Nominating Stockholder withdraws its nomination or a Stockholder Nominee becomes unwilling to serve on the Board of Directors, whether before or after the mailing or other distribution of the definitive proxy statement, then the nomination shall be disregarded, and the Corporation: (i) shall not be required to include in its proxy statement or on any ballot or form of proxy the disregarded Stockholder Nominee or any successor or replacement nominee proposed by the Nominating Stockholder or by any other Nominating Stockholder and (ii) may otherwise communicate to its stockholders, including without limitation by amending or supplementing its proxy statement or ballot or form of proxy, that a Stockholder Nominee will not be included as a nominee in the proxy statement or on any ballot or form of proxy and will not be voted on at the annual meeting.
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(c) Eligibility of Nominating Stockholder.
(1) An “Eligible Holder” is a person who has either (i) been a record holder of the shares of common stock used to satisfy the eligibility requirements in this Section 12(c) continuously for the three-year period specified in Subsection (2) below or (ii) provides to the Secretary of the Corporation, within the time period referred to in Section 12(d), evidence of continuous ownership (as defined below) of such shares for such three-year period from one or more securities intermediaries in a form that the Board of Directors or any committee thereof determines would be deemed acceptable for purposes of a stockholder proposal under Rule 14a-8(b)(2) under the Exchange Act (or any successor rule).
(2) An Eligible Holder or group of up to 20 Eligible Holders may submit a nomination in accordance with this Section 12 only if the person or group (in the aggregate) has continuously owned at least the Minimum Number (as defined below) of shares of the Corporation’s common stock throughout the three-year period preceding and including the date of submission of the Nomination Notice, and continues to own at least the Minimum Number through the date of the annual meeting. Two or more funds that are (x) under common management and investment control, (y) under common management and funded primarily by a single employer or (z) a “group of investment companies,” as such term is defined in Section 12(d)(1)(G)(ii) of the Investment Company Act of 1940, as amended, shall be treated as one Eligible Holder if such Eligible Holder shall provide together with the Nomination Notice documentation reasonably satisfactory to the Corporation that demonstrates that the funds meet the criteria set forth in (x), (y) or (z) hereof. For the avoidance of doubt, in the event of a nomination by a group of Eligible Holders, any and all requirements and obligations for an individual Eligible Holder that are set forth in this Section 12, including the minimum holding period, shall apply to each member of such group; provided, however, that the Minimum Number shall apply to the ownership of the group in the aggregate. Should any stockholder cease to satisfy the eligibility requirements in this Section 12, as determined by the Board of Directors, or withdraw from a group of Eligible Holders at any time prior to the annual meeting of stockholders, the group of Eligible Stockholders shall only be deemed to own the shares held by the remaining members of the group.
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(3) The “Minimum Number” of shares of the Corporation’s common stock means 3% of the number of outstanding shares of common stock as of the most recent date for which such amount is given in any filing by the Corporation with the SEC prior to the submission of the Nomination Notice.
(4) For purposes of this Section 12, an Eligible Holder “owns” only those outstanding shares of the Corporation as to which the Eligible Holder possesses both:
(A) the full voting and investment rights pertaining to the shares; and
(B) the full economic interest in (including the opportunity for profit and risk of loss on) such shares; provided that the number of shares calculated in accordance with clauses (A) and (B) shall not include any shares: (1) purchased or sold by such Eligible Holder or any of its affiliates in any transaction that has not been settled or closed, (2) sold short by such Eligible Holder, (3) borrowed by such Eligible Holder or any of its affiliates for any purpose or purchased by such Eligible Holder or any of its affiliates pursuant to an agreement to resell or subject to any other obligation to resell to another person, or (4) subject to any option, warrant, forward contract, swap, contract of sale, other derivative or similar agreement entered into by such Eligible Holder or any of its affiliates, whether any such instrument or agreement is to be settled with shares or with cash based on the notional amount or value of outstanding shares of the Corporation, in any such case which instrument or agreement has, or is intended to have, the purpose or effect of: (x) reducing in any manner, to any extent or at any time in the future, such Eligible Holder’s or any of its affiliates’ full right to vote or direct the voting of any such shares, and/or (y) hedging, offsetting, or altering to any degree, gain or loss arising from the full economic ownership of such shares by such Eligible Holder or any of its affiliates.
An Eligible Holder “owns” shares held in the name of a nominee or other intermediary so long as the Eligible Holder retains the right to instruct how the shares are voted with respect to the election of directors and possesses the full economic interest in the shares. An Eligible Holder’s ownership of shares shall be deemed to continue during any period in which the Eligible Holder has delegated any voting power by means of a proxy, power of attorney, or other similar instrument or arrangement that is revocable at any time by the Eligible Holder. An Eligible Holder’s ownership of shares shall be deemed to continue during any period in which the Eligible Holder has loaned such shares provided that the Eligible Holder has the power to recall such loaned shares on three business days’ notice, has recalled such loaned shares as of the date of the Nomination Notice and continues to hold such shares through the date of the annual meeting. The terms “owned,” “owning” and other variations of the word “own” shall have correlative meanings. Whether outstanding shares of the Corporation are “owned” for these purposes shall be determined by the Board.
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(5) No Eligible Holder shall be permitted to be in more than one group constituting a Nominating Stockholder, and if any Eligible Holder appears as a member of more than one group, it shall be deemed to be a member of the group that has the largest ownership position as reflected in the Nomination Notice.
(d) Nomination Notice. To nominate a Stockholder Nominee, the Nominating Stockholder must, no earlier than the 120th day and no later than 5:00 p.m., Eastern Time, on the 90th day prior to the first anniversary of the date for the preceding year’s annual meeting, submit to the Secretary of the Corporation at the principal executive office of the Corporation all of the following information and documents (collectively, the “Nomination Notice”); provided, however, that in the event that the date of the annual meeting is advanced or delayed by more than 30 days from the first anniversary of the date of the preceding year’s annual meeting, the Nomination Notice shall be given in the manner provided herein not earlier than the 120th day prior to the date of such annual meeting and not later than 5:00 p.m., Eastern Time, on the later of the 90th day prior to the date of such annual meeting or the tenth day following the day on which public announcement of the date of such meeting is first made:
(1) A Schedule 14N (or any successor form) relating to each Stockholder Nominee, completed and filed with the SEC by the Nominating Stockholder as applicable, in accordance with SEC rules;
(2) A written notice, in a form deemed satisfactory by the Board of Directors, of the nomination of each Stockholder Nominee that includes the following additional information, agreements, representations and warranties by the Nominating Stockholder (including each group member):
(A) the information required with respect to the nomination of directors pursuant to Section 11 of these Bylaws;
(B) the details of any relationship that existed within the past three years and that would have been described pursuant to Item 6(e) of Schedule 14N (or any successor item) if it existed on the date of submission of the Schedule 14N;
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(C) a representation and warranty that the Nominating Stockholder acquired the securities of the Corporation in the ordinary course of business and did not acquire, and is not holding, securities of the Corporation for the purpose or with the effect of influencing or changing control of the Corporation;
(D) a representation and warranty that each Stockholder Nominee’s candidacy or, if elected, Board membership would not violate applicable state or federal law or the rules of any stock exchange on which the Corporation’s securities are traded;
(E) a representation and warranty that each Stockholder Nominee:
(i) does not have any direct or indirect relationship with the Corporation that would cause the Stockholder Nominee to be considered not independent pursuant to the Corporation’s policy on director independence contained in the Corporation’s Corporate Governance Guidelines as most recently published on its website and otherwise qualifies as independent under the rules of the New York Stock Exchange;
(ii) meets the audit committee and compensation committee independence requirements under the rules of the New York Stock Exchange;
(iii) is a “non-employee director” for the purposes of Rule 16b-3 under the Exchange Act (or any successor rule);
(iv) is an “outside director” for the purposes of Section 162(m) of the Internal Revenue Code (or any successor provision);
(v) [reserved]; and
(vi) is not and has not been subject to any event specified in Rule 506(d)(1) of Regulation D (or any successor rule) under the Securities Act of 1933 or Item 401(f) of Regulation S-K (or any successor rule) under the Exchange Act, without reference to whether the event is material to an evaluation of the ability or integrity of such Stockholder Nominee;
(F) a representation and warranty that the Nominating Stockholder satisfies the eligibility requirements set forth in Section 12(c) and has provided evidence of ownership to the extent required by Section 12(c)(1);
(G) a representation and warranty that the Nominating Stockholder intends to continue to satisfy the eligibility requirements described in Section 12(c) through the date of the annual meeting and intends to continue to hold the Minimum Number of shares for at least one year following the annual meeting;
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(H) details of any position of a Stockholder Nominee as an officer or director of any competitor (that is, any entity that produces products or provides services that compete with or are alternatives to the principal products produced or services provided by the Corporation or its affiliates) of the Corporation, within the three years preceding the submission of the Nomination Notice;
(I) a representation and warranty that the Nominating Stockholder will not engage in a “solicitation” within the meaning of Rule 14a-1(l) (without reference to the exception in Section 14a-(l)(2)(iv)) (or any successor rules) with respect to the annual meeting, other than with respect to a Stockholder Nominee or any nominee of the Board of the Directors;
(J) a representation and warranty that the Nominating Stockholder will not use any proxy card other than the Corporation’s proxy card in soliciting stockholders in connection with the election of a Stockholder Nominee at the annual meeting;
(K) if desired, a Supporting Statement; and
(L) in the case of a nomination by a group, the designation by all group members or one group member that is authorized to act on behalf of all group members with respect to matters relating to the nomination, including withdrawal of the nomination;
(3) An executed agreement, in a form deemed satisfactory by the Board of Directors or any committee thereof pursuant to which the Nominating Stockholder (including each group member) agrees:
(A) to comply with all applicable laws, rules and regulations in connection with the nomination, solicitation and election;
(B) to file any written solicitation or other communication with the Corporation’s stockholders relating to one or more of the Corporation’s directors or director nominees or any Stockholder Nominee with the SEC, regardless of whether any such filing is required under rule or regulation or whether any exemption from filing is available for such materials under any rule or regulation;
(C) to assume all liability stemming from an action, suit or proceeding concerning any actual or alleged legal or regulatory violation arising out of any communication by the Nominating Stockholder or any of its Stockholder Nominees with the Corporation, its stockholders or any other person in connection with the nomination or election of directors, including, without limitation, the Nomination Notice;
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(D) to indemnify and hold harmless (jointly with all other group members, in the case of a group member) the Corporation and each of its directors, officers and employees individually against any liability, loss, damages, expenses or other costs (including attorneys’ fees) incurred in connection with any threatened or pending action, suit or proceeding, whether legal, administrative or investigative, against the Corporation or any of its directors, officers or employees arising out of or relating to a failure or alleged failure of the Nominating Stockholder or any of its Stockholder Nominees to comply with, or any breach or alleged breach of, it or their obligations, agreements or representations under this Section 12;
(E) in the event that any information included in the Nomination Notice, or any other communication by the Nominating Stockholder (including with respect to any group member), with the Corporation, its stockholders or any other person in connection with the nomination or election ceases to be true and accurate in all material respects (or omits a material fact necessary to make the statements made not misleading), or that the Nominating Stockholder (including any group member) has failed to continue to satisfy the eligibility requirements described in Section 12(c), to promptly (and in any event within 48 hours of discovering such misstatement, omission or failure) notify the Corporation and any other recipient of such communication of (A) the misstatement or omission in such previously provided information and of the information that is required to correct the misstatement or omission or (B) such failure; and
(4) An executed agreement, in a form deemed satisfactory by the Board of Directors or any committee thereof or by each Stockholder Nominee:
(A) to provide to the Corporation such other information and certifications, including completion of the Corporation’s director questionnaire, as it may reasonably request;
(B) at the reasonable request of the Nominating and Corporate Governance Committee, to meet with the Nominating and Corporate Governance Committee to discuss matters relating to the nomination of such Stockholder Nominee to the Board of Directors, including the information provided by such Stockholder Nominee to the Corporation in connection with his or her nomination and such Stockholder Nominee’s eligibility to serve as a member of the Board of Directors;
(C) that such Stockholder Nominee has read and agrees, if elected, to serve as a member of the Board of Directors, to adhere to the Corporation’s Corporate Governance Guidelines and Code of Business Conduct and Ethics and any other Corporation policies and guidelines applicable to directors; and
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(D) that such Stockholder Nominee is not and will not become a party to (i) any compensatory, payment or other financial agreement, arrangement or understanding with any person or entity in connection with his or her nomination, service or action as a director of the Corporation that has not been disclosed to the Corporation, (ii) any agreement, arrangement or understanding with any person or entity as to how such Stockholder Nominee would vote or act on any issue or question as a director (a “Voting Commitment”) that has not been disclosed to the Corporation or (iii) any Voting Commitment that could limit or interfere with such Stockholder Nominee’s ability to comply, if elected as a director of the Corporation, with its director duties under applicable law.
The information and documents required by this Section 12(d) to be provided by the Nominating Stockholder shall be: (i) provided with respect to and executed by each group member, in the case of information applicable to group members; and (ii) provided with respect to the persons specified in Instruction 1 to Items 6(c) and (d) of Schedule 14N (or any successor item) in the case of a Nominating Stockholder or group member that is an entity. The Nomination Notice shall be deemed submitted on the date on which all the information and documents referred to in this Section 12(d) (other than such information and documents contemplated to be provided after the date the Nomination Notice is provided) have been delivered to or, if sent by mail, received by the Secretary of the Corporation.
(e) Exceptions.
(1) Notwithstanding anything to the contrary contained in this Section 12, the Corporation may omit from its proxy statement any Stockholder Nominee and any information concerning such Stockholder Nominee (including a Nominating Stockholder’s Supporting Statement) and no vote on such Stockholder Nominee will occur (notwithstanding that proxies in respect of such vote may have been received by the Corporation), and the Nominating Stockholder may not, after the last day on which a Nomination Notice would be timely, cure in any way any defect preventing the nomination of such Stockholder Nominee, if:
(A) the Corporation receives a notice pursuant to Section 11 of these Bylaws that a stockholder intends to nominate a candidate for director at the annual meeting, whether or not such notice is subsequently withdrawn or made the subject of a settlement with the Corporation;
(B) the Nominating Stockholder or the designated lead group member, as applicable, or any qualified representative thereof, does not appear at the meeting of stockholders to present the nomination submitted pursuant to this Section 12 or the Nominating Stockholder withdraws its nomination or the chairman of the annual meeting declares that such nomination was not made in accordance with the procedures prescribed by this Section 12 and shall therefore be disregarded;
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(C) the Board of Directors determines that such Stockholder Nominee’s nomination or election to the Board of Directors would result in the Corporation violating or failing to be in compliance with the Corporation’s bylaws or charter or any applicable law, rule or regulation to which the Corporation is subject, including any rules or regulations of the New York Stock Exchange;
(D) such Stockholder Nominee was nominated for election to the Board of Directors pursuant to this Section 12 at one of the Corporation’s two preceding annual meetings of stockholders and either withdrew or became ineligible or received a vote of less than 25% of the votes cast in favor of such Stockholder Nominee’s election;
(E) such Stockholder Nominee has been, within the past three years, an officer or director of a competitor, as defined for purposes of Section 8 of the Clayton Antitrust Act of 1914, as amended; or
(F) the Corporation is notified, or the Board of Directors determines, that the Nominating Stockholder or the Stockholder Nominee has failed to continue to satisfy the eligibility requirements described in Section 12(c), any of the representations and warranties made in the Nomination Notice ceases to be true and accurate in all material respects (or omits a material fact necessary to make the statements made not misleading), such Stockholder Nominee becomes unwilling or unable to serve on the Board of Directors or any material violation or breach occurs of the obligations, agreements, representations or warranties of the Nominating Stockholder or such Stockholder Nominee under this Section 12.
(2) Notwithstanding anything to the contrary contained in this Section 12, the Corporation may omit from its proxy statement, or may supplement or correct, any information, including all or any portion of the Supporting Statement or any other statement in support of a Stockholder Nominee included in the Nomination Notice, if the Board of Directors determines that:
(A) such information is not true in all material respects or omits a material statement necessary to make the statements made not misleading; or
(B) the inclusion of such information in the proxy statement would otherwise violate the SEC proxy rules or any other applicable law, rule or regulation.
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The Corporation may solicit against, and include in the proxy statement its own statement relating to, any Stockholder Nominee.
ARTICLE II
DIRECTORS
Section 1. Powers. All of the powers of the Corporation shall be exercised by or under the direction of the Board of Directors except as otherwise provided by the Charter or required by law.
Section 2. Number and Terms. The Board of Directors shall establish and may increase or decrease the number of directors of the Corporation, provided, that the number thereof shall never be less than the minimum number permitted under the Maryland General Corporation Law nor more than 15, and further provided, that the tenure of office of a director shall not be affected by any decrease in the number of directors. A majority of the directors shall have been affirmatively determined by the Board to be independent, as defined and to the extent required in the applicable rules of the SEC and the listing standards of the New York Stock Exchange. The directors shall be elected at the annual meeting of the stockholders and each director shall be elected to serve for a term of one year and until his successor shall be elected and shall qualify or until his earlier resignation or removal.
Section 3. Director Nominations. Nomination of candidates for election as directors of the Corporation at any annual or special meeting of stockholders may be made (a) by, or at the direction of, a majority of the Board of Directors or (b) by any stockholder entitled to vote at such annual meeting and has complied with Article 1, Section 11.
Section 4. Stockholder Status. No Director need be a stockholder of the Corporation.
Section 5. Vacancies. Any vacancy occurring on the Board of Directors, including any vacancy created by reason of an increase in the number of directors, shall be filled in the manner provided in Article VII, Section 6 of the Charter.
Section 6. Resignation. Any Director may resign at any time by giving written notice to the Board of Directors, effective upon execution and delivery to the Corporation of such written notice or upon any future date specified in the notice, unless the resignation otherwise provides.
Section 7. Regular Meetings. The regular annual meeting of the Board of Directors shall be held, without other notice than this Bylaw, on the same date and at the same place as the annual meeting of stockholders following the close of such meeting of stockholders. Other regular meetings of the Board of Directors may be held at such hour, date and place as the Board of Directors may by resolution from time to time determine without other notice than such resolution.
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Section 8. Executive Sessions. To ensure free and open discussion and communication among the non-management directors, the non-management directors shall meet in executive session at least twice a year with no members of management present.
Section 9. Special Meetings. Special meetings of the Board of Directors may be called, orally or in writing, by or at the request of a majority of the Directors, the Chairman of the Board, if one is elected, the Lead Director, if one is elected, or the Chief Executive Officer. The person calling any such special meeting of the Board of Directors may fix the hour, date and place thereof.
Section 10. Notice of Meetings. Notice of the hour, date and place of all special meetings of the Board of Directors shall be given to each Director by the Secretary or an Assistant Secretary, or in case of the death, absence, incapacity or refusal of such persons, by the Chairman of the Board, if one is elected, or the Chief Executive Officer or such other officer designated by the Chairman of the Board, if one is elected, or the Chief Executive Officer. Notice of any special meeting of the Board of Directors shall be given to each Director in person or by telephone, electronic mail, facsimile transmission or by telegram sent to his business or home address at least 24 hours in advance of the meeting, or by written notice mailed to his business or home address at least 48 hours in advance of the meeting. Such notice shall be deemed to be delivered when hand delivered to such address, when read to such Director by telephone, when deposited in the mail so addressed with postage thereon prepaid, upon transmission of the message by electronic mail, upon completion of transmission of a facsimile message and receipt of a completed answer back indicating receipt or when delivered to the telegraph company if sent by telegram.
When any Board of Directors meeting, either regular or special, is adjourned for more than 30 days, notice of the adjourned meeting shall be given as in the case of an original meeting. It shall not be necessary to give any notice of the hour, date or place of any meeting adjourned for 30 days or less or of the business to be transacted at such meeting, other than an announcement at the meeting at which such adjournment is taken of the hour, date and place to which the meeting is adjourned.
A written waiver of notice executed before or after a meeting by a director and filed with the records of the meeting shall be deemed to be equivalent to an effective notice of the meeting. The attendance of a director at a meeting shall constitute a waiver of notice of such meeting. Except as otherwise required by law, by the Charter or by these Bylaws, neither the business to be transacted at, nor the purpose of, any meeting of the Board of Directors need be specified in the notice or waiver of notice of such meeting.
Section 11. Quorum. At any meeting of the Board of Directors, a majority of the Directors then in office shall constitute a quorum for the transaction of business, but if less than a quorum is present at a meeting, a majority of the directors present may adjourn the meeting from time to time, and the meeting may be held as adjourned without further notice, except as provided in Section 10 of this Article II. Any business which might have been transacted at the meeting as originally noticed may be transacted at such adjourned meeting at which a quorum is present.
Section 12. Action at Meeting. At any meeting of the Board of Directors at which a quorum is present and subject to Section 8 of Article VII of the Charter, a majority of the Directors present may take any action on behalf of the Board of Directors, unless otherwise required by law, by the Charter or these Bylaws.
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Section 13. Action by Consent. Any action required or permitted to be taken at any meeting of the Board of Directors may be taken without a meeting if all members of the Board of Directors consent thereto in writing. Such written consent shall be filed with the records of the proceedings of the Board of Directors and shall be treated for all purposes as a vote at a meeting of the Board of Directors.
Section 14. Manner of Participation. Members of the Board of Directors or of committees elected by the Board pursuant to Section 15 of this Article II may participate in meetings of the Board or of such committees by means of telephone conference or similar communications equipment by means of which all directors participating in the meeting can hear each other at the same time, and participation in a meeting in accordance herewith shall constitute presence in person at such meeting for purposes of these Bylaws.
Section 15. Committees. The Board of Directors, by the affirmative vote of a majority of the directors then in office may elect from its number directors to serve on one or more committees, including an Audit Committee, a Compensation Committee and an Nominating/Corporate Governance Committee, and may delegate thereto some or all of its powers except those which by law, by the Charter or by these Bylaws, may not be delegated. Except as the Board of Directors may otherwise determine or as required by law, by the Charter or by these Bylaws, any such committee may make rules for conduct of its business, but unless otherwise provided by the Board of Directors or in such rules, its business shall be conducted so far as possible in the same manner as is provided by the Charter and by these Bylaws for the Board of Directors. Any committee to which the Board of Directors delegates any of its powers or duties shall keep records of its meetings and shall report its action to the Board of Directors.
The Board of Directors shall have power to rescind any action of any committee, other than the Audit Committee, but no such rescission shall have retroactive effect. With the approval of the Board of Directors, the Chief Executive Officer may appoint such other committees consisting of such directors as the Chief Executive Officer shall select. Any recommendations of such committees appointed by the Chief Executive Officer shall be submitted to the Board of Directors.
Section 16. Compensation of Directors. Directors shall receive compensation for their services as shall be determined by a majority of the Board of Directors, provided that Directors who are serving the Corporation as officers or employees and who receive compensation for their services as such (“Employee Directors”) shall not receive any salary or other compensation for their services as Directors of the Corporation; provided, however, that such Employee Directors may be paid their reasonable expenses incurred as a director.
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ARTICLE III
OFFICERS
Section 1. Enumeration. The officers of the Corporation shall consist of a Chief Executive Officer, a President, a Secretary and a Treasurer and such other officers, including without limitation a Chairman of the Board, a Chief Operating Officer, a Chief Legal Officer, a Chief Financial Officer, a Chief Accounting Officer, one or more Vice Presidents (including Executive Vice Presidents or Senior Vice Presidents), Assistant Vice Presidents, Assistant Treasurers and Assistant Secretaries, as the Board of Directors may determine. Effective on the date on which the Corporation hires a Chief Executive Officer that is not also the Chairman of the Board, any number of offices may be held by the same person, except the offices of Chairman of the Board and the Chief Executive Officer.
Section 2. Election and Appointment. At the regular annual meeting of the Board of Directors following the annual meeting of stockholders, the Board of Directors shall elect the Chief Executive Officer, the President, the Treasurer and the Secretary. Other officers may be appointed by the Board of Directors at such regular annual meeting of the Board of Directors or at any other regular or special meeting, or other officers may be appointed by the Chief Executive Officer.
Section 3. Qualification. No officer need be a stockholder or a director. Any person may occupy more than one office of the Corporation at any time except the offices of President and Vice President. Any officer may be required by the Board of Directors to give bond, at the Corporation’s expense, for the faithful performance of his duties in such amount and with such sureties as the Board of Directors may determine.
Section 4. Tenure. Except as otherwise provided by the Charter or by these Bylaws, each of the officers of the Corporation shall hold office until the regular annual meeting of the Board of Directors following the next annual meeting of stockholders and until his successor is elected and qualified or until his earlier resignation or removal. Election or appointment of an officer, employee or agent shall not of itself create contract rights. The Board of Directors may, however, authorize the Corporation to enter into an employment contract with any officer in accordance with law, but no such contract right shall prohibit the right of the Board of Directors to remove any officer at any time in accordance with Section 6 of this Article III.
Section 5. Resignation. Any officer may resign by delivering his written resignation to the Corporation addressed to the Chief Executive Officer or the Secretary, and such resignation shall be effective upon receipt unless it is specified to be effective at some other time or upon the happening of some other event.
Section 6. Removal. If the Board of Directors in its judgment finds that the best interests of the Corporation will be served, the Board of Directors may remove any officer by the affirmative vote of a majority of the Directors then in office. Such removal shall be without prejudice to the contract rights, if any, of the person so removed.
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Section 7. Absence or Disability. In the event of the absence or disability of any officer, the Board of Directors may designate another officer to act temporarily in place of such absent or disabled officer.
Section 8. Vacancies. Any vacancy in any office may be filled for the unexpired portion of the term by the Board of Directors.
Section 9. Chief Executive Officer. The President may be the Chief Executive Officer or the Board of Directors may elect another person to be the Chief Executive Officer. In the absence of the Chairman of the Board, the Chief Executive Officer shall preside, when present, at all meetings of the Board of Directors. The Chief Executive Officer shall, subject to the direction of the Board of Directors, have general supervision and control of the Corporation’s business and shall preside, if the Chairman of the Board is not present, at all meetings of the stockholders. Effective on the date on which the Corporation hires a Chief Executive Officer that is not also the Chairman of the Board, the Chief Executive Officer shall not concurrently serve as the Chairman of the Board.
Section 10. Chairman of the Board. The Chairman of the Board shall preside at all meetings of the Board of Directors and at all meetings of stockholders. If the Chairman of the Board is absent, the Chief Executive Officer shall preside at meetings of the Board of Directors and at meetings of stockholders. The Chairman of the Board shall have such other powers and shall perform such other duties as the Board of Directors may from time to time designate and shall act as an officer of the Corporation if so designated by the Board.
Section 11. President. If the President is not the Chief Executive Officer or Chairman of the Board and in the absence of such persons, the President shall preside, when present, at all meetings of the stockholders. If the President is not the Chief Executive Officer, he shall have such powers and perform such duties as the Board of Directors or the Chief Executive Officer may from time to time designate.
Section 12. Chief Operating Officer, Chief Legal Officer, Chief Financial Officer and Chief Accounting Officer. Any Chief Operating Officer, Chief Legal Officer, Chief Financial Officer or Chief Accounting Officer shall have such powers and shall perform such duties as the Board of Directors or the Chief Executive Officer may from time to time designate.
Section 13. Vice Presidents and Assistant Vice Presidents. Any Vice President (including any Executive Vice President or Senior Vice President) and Assistant Vice President shall have such powers and shall perform such duties as the Board of Directors or the Chief Executive Officer may from time to time designate.
Section 14. Treasurer and Assistant Treasurers. The Chief Financial Officer shall be the Treasurer, unless the Board of Directors shall elect another officer to be the Treasurer. The Treasurer shall, subject to the direction of the Board of Directors and except as the Board of Directors or the Chief Executive Officer may otherwise provide, have general charge of the financial affairs of the Corporation and shall cause to be kept accurate books of account. He shall have custody of all funds, securities and valuable documents of the Corporation. He shall have such other duties and powers as may be designated from time to time by the Board of Directors or the Chief Executive Officer. In the absence of a Chief Financial Officer, the office of the Treasurer shall be deemed to be the office of the Chief Financial Officer of the Corporation whenever the signature of the Chief Financial Officer is required on any document or instrument, by the laws of the United States or any state, or elsewhere in the Bylaws, and the Treasurer shall have authority to affix his signature in such capacity.
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The office of the Chief Accounting Officer shall be deemed an Assistant Treasurer of the Corporation whenever the signature of an Assistant Treasurer is required on any document or instrument, by the laws of the United States or any state, or elsewhere in these Bylaws, and the Vice President of Finance and Accounting shall have authority to affix his signature in such capacity. Any Treasurer or Assistant Treasurer shall have such powers and perform such duties as the Board of Directors or the Chief Executive Officer may from time to time designate.
Section 15. Secretary and Assistant Secretaries. The Secretary shall record all the proceedings of the meetings of the stockholders and the Board of Directors (including committees of the Board) in books kept for that purpose. In the absence of the Secretary from any such meeting, a temporary secretary chosen at the meeting shall record the proceedings thereof. The Secretary shall have charge of the stock ledger (which may, however, be kept by any transfer or other agent of the Corporation). The secretary shall have custody of the seal of the Corporation, and the Secretary, or an Assistant Secretary, shall have authority to affix it to any instrument requiring it, and, when so affixed, the seal may be attested by the signature of the Secretary or an Assistant Secretary. The Secretary shall have such other duties and powers as may be designated from time to time by the Board of Directors or the Chief Executive Officer. In the absence of the Secretary, any Assistant Secretary may perform the duties and responsibilities of the Secretary.
Any Assistant Secretary shall have such powers and perform such duties as the Board of Directors or the Chief Executive Officer may from time to time designate.
Section 16. Other Powers and Duties. Subject to these Bylaws and to such limitations as the Board of Directors may from time to time prescribe, the officers of the Corporation shall each have such powers and duties as generally pertain to their respective offices, as well as such powers and duties as from time to time may be conferred by the Board of Directors or the Chief Executive Officer.
ARTICLE IV
STOCK
Section 1. Certificates of Stock. Unless otherwise provided by the Board of Directors or by law, each stockholder shall be entitled to a certificate of the stock of the Corporation in such form as may from time to time be prescribed by the Board of Directors. Such certificate shall bear the seal of the Corporation, if one has been adopted, and shall be signed by the Chairman of the Board of Directors, Chief Executive Officer or President and countersigned by the Treasurer or an Assistant Treasurer or the Secretary or an Assistant Secretary. The seal of the Corporation, if one has been adopted, and any and all signatures on the certificate may be a facsimile, including those of any transfer agent or registrar. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed on such certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if he were such officer, transfer agent or registrar at the time of its issue. Every certificate for shares of stock which are subject to any restriction on transfer and every certificate issued when the Corporation is authorized to issue more than one class or series of stock shall contain such legend with respect thereto as is required by law.
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Section 2. Transfers. Subject to any restrictions on transfer and unless otherwise provided by the Board of Directors, shares of stock may be transferred only on the books of the Corporation by the surrender to the Corporation or its transfer agent of the certificate therefor properly endorsed or accompanied by a written assignment or power of attorney properly executed, with transfer stamps (if necessary) affixed, and with such proof of the authenticity of signature as the Corporation or its transfer agent may reasonably require.
Section 3. Record Holders. Except as may otherwise be required by law, by the Charter or by these Bylaws, the Corporation shall be entitled to treat the record holder of stock as shown on its books as the owner of such stock for all purposes, including the payment of dividends and the right to vote with respect thereto, regardless of any transfer, pledge or other disposition of such stock, until the shares have been transferred on the books of the Corporation in accordance with the requirements of these Bylaws.
It shall be the duty of each stockholder to notify the Corporation or its transfer agent of his post office address and any changes thereto.
Section 4. Record Date. In order that the Corporation may determine the stockholders entitled to receive notice of or to vote at any meeting of stockholders or any adjournments thereof, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board of Directors may fix, in advance, a record date, which shall not be more than 90 days nor less than 10 days before the date of such meeting, nor more than 90 days prior to any other action. In such case, only stockholders of record on such record date shall be so entitled, notwithstanding any transfer of stock on the stock transfer books of the Corporation after the record date.
If no record date is fixed:
(a) the record date for determining stockholders entitled to receive notice of or to vote at a meeting of stockholders shall be the later of (i) the close of business on the day on which notice is mailed or (ii) the 30th day before the meeting; and
(b) the record date for determining stockholders entitled to receive payment of a dividend or an allotment of any rights shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto.
Section 5. Replacement of Certificates. In case of the alleged loss, destruction or mutilation of a certificate of stock, a duplicate certificate may be issued in place thereof upon such terms as the Corporation or its transfer agent may prescribe.
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Section 6. Transfer Agents and Registrars. The Corporation may serve as the transfer agent and registrar of the shares of stock, or the Board of Directors may, in its discretion, appoint one or more responsible bank, trust company or other entity as the Board of Directors may deem advisable, from time to time, to act as transfer agent and registrar of shares of stock. No certificate for shares of stock shall be valid until countersigned by the transfer agent and registered by the registrar.
Section 7. Stockholders’ Addresses. Every stockholder or transferee shall furnish the Secretary or a transfer agent with the address to which notice of meetings and all other notices may be served upon or mailed to such stockholder or transferee, and in default thereof, such stockholder or transferee shall not be entitled to service or mailing of any such notice.
Section 8. Repurchase of Shares of Stock. The Corporation may purchase its shares of stock and invest its assets in its own shares of stock, provided that in each case the consent of the Board of Directors shall have been obtained.
ARTICLE V
INDEMNIFICATION
Section 1. Right to Indemnification. The Corporation shall, to the maximum extent permitted by the Maryland General Corporation Law in effect from time to time, indemnify, and, without a preliminary determination of the ultimate entitlement to indemnification, pay or reimburse reasonable expenses in advance of final disposition of a proceeding to (a) any individual who is a present or former director or officer of the Corporation or (b) any individual who, while a director or officer of the Corporation and at the request of the Corporation, serves or has served another corporation, real estate investment trust, partnership, joint venture, trust, employee benefit plan or any other enterprise as a director, officer, partner or trustee and, in each case, shall indemnify such person from and against any claim or liability to which such person may become subject or which such person may incur by reason of his status as a present or former director or officer of the Corporation or director, officer, partner or trustee of such other entity (each, an “Indemnitee”). The Corporation shall, to the maximum extent permitted by the Maryland General Corporation Law in effect from time to time, provide such indemnification and advancement of expenses to a person who served a predecessor of the Corporation in any of the capacities described above (any such person shall also be deemed to be an “Indemnitee”).
Section 2. Indemnification of Employees and Agents of the Corporation. With the approval of the Board of Directors, the Corporation shall, to the maximum extent permitted by the Maryland General Corporation Law in effect from time to time, and to such further extent as it shall deem appropriate under the circumstances, provide such indemnification and advancement of expenses as described in Section 1 above, to any employee or agent of the Corporation or a predecessor of the Corporation (each such person shall also be deemed to be an “Indemnitee”).
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Section 3. Right of Indemnitee to Bring Suit. If a claim under this Article V is not paid in full by the Corporation within 60 days after a written claim has been received by the Corporation, except in the case of a claim for an advancement of expenses, in which case the applicable period shall be 20 days, the Indemnitee may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim. If the Indemnitee is successful in whole or in part in any such suit, or in a suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the Indemnitee shall also be entitled to be paid the expense of prosecuting or defending such suit. In any suit brought by an Indemnitee who is a present or former director to enforce a right to indemnification hereunder (but not in a suit brought by the Indemnitee to enforce a right to an advancement of expenses), it shall be a defense that such Indemnitee has not met the applicable standard of conduct set forth in the Maryland General Corporation Law. In addition, in any suit by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the Corporation shall be entitled to recover such expenses upon a final adjudication that the Indemnitee who is a present or former director has not met the applicable standard of conduct set forth in the Maryland General Corporation Law. Neither the failure of the Corporation (including its Board of Directors, independent legal counsel, or stockholders) to have made a determination prior to the commencement of such suit that indemnification of the Indemnitee is proper in the circumstances because the Indemnitee has met the applicable standard of conduct set forth in the Maryland General Corporation Law, nor an actual determination by the Corporation (including its Board of Directors, independent legal counsel or stockholders) that the Indemnitee has not met such applicable standard of conduct, shall create a presumption that the Indemnitee has not met the applicable standard of conduct. In any suit brought by the Indemnitee to enforce a right to indemnification or to an advancement of expenses hereunder, or by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the burden of proving that the Indemnitee is not entitled to be indemnified, or to such advancement of expenses, under this Article V or otherwise shall be on the Corporation.
Section 4. Non-Exclusivity of Rights. The rights to indemnification and to advancement of expenses conferred in this Article V shall not be exclusive of any other right that any person may have or hereafter acquire under these Bylaws, the Charter or any statute, agreement, vote of stockholders or disinterested directors or otherwise.
Section 5. Insurance. The Corporation may maintain insurance, at its expense, to protect itself and any director, officer, employee or agent of the Corporation or any director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the Maryland General Corporation Law.
ARTICLE VI
MISCELLANEOUS PROVISIONS
Section 1. Fiscal Year. The fiscal year of the Corporation shall end on December 31 of each year or on such other date as may be fixed by the Board of Directors.
Section 2. Seal. The seal of the Corporation shall be in the form of a circle and shall have inscribed thereon the name of the Corporation and the year of its organization. The seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced.
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Section 3. Investment Policies. The directors may from time to time adopt, amend, revise or terminate any policy or policies with respect to investments by the Corporation as they shall deem appropriate in their sole discretion.
Section 4. Execution of Instruments. All deeds, leases, transfers, contracts, bonds, notes and other obligations to be entered into by the Corporation in the ordinary course of its business without director action may be executed on behalf of the Corporation by the Chairman of the Board, if one is elected, the Chief Executive Officer, the President or the Treasurer or any other officer, employee or agent of the Corporation as the Board of Directors may authorize.
Section 5. Voting of Securities. Unless the Board of Directors otherwise provides, the Chairman of the Board, if one is elected, the Chief Executive Officer, the President or the Treasurer may waive notice of and act on behalf of this Corporation, or appoint another person or persons to act as proxy or attorney in fact for this Corporation with or without discretionary power and/or power of substitutions at any meeting of stockholders or stockholders of any other corporation or organization, any of whose securities are held by this Corporation.
Section 6. Resident Agent. The Board of Directors may appoint a resident agent upon whom legal process may be served in any action or proceeding against the Corporation.
Section 7. Corporate Records. The original or attested copies of the Charter, Bylaws and records of all meetings of the incorporators, stockholders and the Board of Directors and the stock transfer books, which shall contain the names of all stockholders, their record addresses and the amount of stock held by each, may be kept outside the State of Maryland and shall be kept at the principal office of the Corporation, at the office of its counsel or at an office of its transfer agent.
Section 8. Amendments. The exclusive power to alter, amend or repeal these bylaws, and to adopt new bylaws, shall be vested in the Board of Directors.
Section 9. Offices. The principal office of the Corporation within the State of Maryland shall be located at such place as the Board of Directors may designate. The Corporation may have additional offices, including a principal executive office, at such place or places both within and without the State of Maryland as the Board of Directors may from time to time determine or the business of the Corporation may require.
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Exhibit 3.2
BRAEMAR HOTELS & RESORTS INC.
ARTICLES OF AMENDMENT
Braemar Hotels & Resorts Inc., a Maryland corporation (the “Corporation”), hereby certifies to the State Department of Assessments and Taxation of Maryland (the “Department”) that:
FIRST: The charter of the Corporation (the “Charter”) is hereby amended by deleting therefrom in its entirety Section 7 of Article V and inserting in lieu thereof new Section 7 of Article V to read as follows:
“Section 7. Approval of Extraordinary Actions. Notwithstanding any provision of law requiring any action to be taken or approved by the affirmative vote of the holders of shares entitled to cast a greater proportion of votes, and except as specifically provided in Article VI, Section 9 and Article VII, Section 10, any such action shall be effective and valid if declared advisable by the Board of Directors and taken or approved by the affirmative vote of holders of shares entitled to cast a majority of all the votes entitled to be cast on the matter.”
SECOND: The Charter is hereby amended by deleting therefrom in its entirety Section 9 of Article VI and inserting in lieu thereof new Section 9 of Article VI to read as follows:
“Section 9. Amendments. Notwithstanding any other provisions of the MGCL or the Charter of the Corporation to the contrary, the affirmative vote of stockholders holding at least a majority of all of the votes entitled to be cast thereon shall be required to amend, alter, change, repeal, or adopt any provisions inconsistent with, the provisions of this Article VI.”
THIRD: The Charter is hereby amended by deleting therefrom in its entirety Section 3 of Article VII and inserting in lieu thereof new Section 3 of Article VII to read as follows:
“Section 3. Number and Terms of Directors. The number of directors of the Corporation shall be fixed from time to time by the Board of Directors, and may be increased or decreased pursuant to the Bylaws, but shall never be less than the minimum number required by the MGCL. The directors shall be elected at the annual meeting of the stockholders and each director shall be elected to serve for a term of one year and until his or her successor shall be elected and shall qualify or until his or her earlier resignation or removal.”
FOURTH: The Charter is hereby amended by deleting therefrom in its entirety Section 4 of Article VII and inserting in lieu thereof new Section 4 of Article VII to read as follows:
“Section 4. Nominations of Director Candidates. Advance notice of nominations for the election of directors, other than by the Board of Directors or a committee thereof, shall be given in the manner provided in the Bylaws.”
Annex A
FIFTH: The amendments to the Charter as set forth above have been duly advised by the Board of Directors of the Corporation and approved by the stockholders of the Corporation as required by law.
SIXTH: There has been no increase in the authorized shares of stock of the Corporation effected by the amendments to the Charter as set forth above.
SEVENTH: The number of directors of the Corporation is currently [eight], and the names of the current directors are as follows:
[NAME]1
[NAME]
[NAME]
[NAME]
[NAME]
[NAME]
[NAME]
[NAME]
EIGHTH: The undersigned acknowledges these Articles of Amendment to be the corporate act of the Corporation and as to all matters or facts required to be verified under oath, the undersigned acknowledges that to the best of his knowledge, information and belief, these matters and facts are true in all material respects and that this statement is made under the penalties for perjury.
[SIGNATURE PAGE FOLLOWS]
1 Following the conclusion of the 2026 Annual Meeting of Braemar Hotels & Resorts, the final number and names of directors appointed will be inserted and the Articles of Amendment will thereafter be filed with the Maryland SDAT.
Annex A
IN WITNESS WHEREOF, the Corporation has caused these Articles of Amendment to be executed in its name and on its behalf by its Chief Executive Officer and President and attested by its Chief Legal Officer and Secretary on this [•] day of December, 2026.
| ATTEST: | BRAEMAR HOTELS & RESORTS INC. | ||
| /s/ | By: | /s/ | |
| Robert G. Haiman | Richard J. Stockton | ||
| Chief Legal Officer and Secretary | Chief Executive Officer and President | ||
Exhibit 10.1
TERMINATION AND RELEASE AGREEMENT
This Termination and Release Agreement (this “Agreement”), dated as of November 10, 2026, is entered into by and among Braemar Hotels & Resorts Inc., a Maryland corporation (“Braemar”) and its Affiliates party hereto (collectively, the “Braemar Parties”), on the one hand, and Ashford Inc., a Nevada corporation (“Ashford”) and its Affiliates party hereto (collectively, the “Ashford Parties”), on the other hand. The Braemar Parties and the Ashford Parties are sometimes referred to herein individually as a “Party” or collectively as the “Parties.”
WHEREAS, (i) Braemar, Braemar Hospitality Limited Partnership, Braemar TRS Corporation (collectively, the “Company”), and (ii) Ashford Inc., and Ashford Hospitality Advisors LLC (collectively, the “Advisor”) are parties to that certain Fifth Amended and Restated Advisory Agreement, dated as of April 23, 2018, as amended by that certain Enhanced Return Funding Program Agreement and Amendment No. 1 to the Fifth Amended and Restated Advisory Agreement, dated as of January 15, 2019, as further amended by that certain Amendment No. 2 to the Fifth Amended and Restated Advisory Agreement, dated as of August 16, 2021, and as further amended by that certain Amendment No. 3 to the Fifth Amended and Restated Advisory Agreement, dated as of May 21, 2026 (as so amended, the “Advisory Agreement”), and that certain Letter Agreement, dated as of August 26, 2025, as amended by that certain Amendment to Letter Agreement, dated as of December 22, 2025 (the “Letter Agreement Amendment” and the letter agreement as so amended, the “Letter Agreement”), pursuant to which, among other things, the Advisory Agreement will terminate upon the consummation of a Company Sale Transaction (as defined in the Letter Agreement) and payment of the Company Sale Fee, Accrued Fees and Master Agreement Termination Fee (collectively, the “Termination Payments”) to the Ashford Parties;
WHEREAS, in the Letter Agreement, Advisor agreed to accept the Company Sale Fee in lieu of (and as payment in full of) the Full Termination Payment (as defined in the Letter Agreement), which represented a material discount to the Full Termination Payment;
WHEREAS, the special committee of the board of directors of Braemar, composed entirely of independent directors, was formed to evaluate a range of strategic alternatives available to Braemar and, following such evaluation, determined that it is in the best interests of Braemar and its stockholders to pursue the termination of the Advisory Agreement and the internalization of management of Braemar (the “Internalization”) in order to maximize shareholder value, and the board of directors of Braemar subsequently approved the consummation of a Company Sale Transaction, the payment of the Termination Payments and the Internalization;
WHEREAS, a Company Sale Transaction was consummated on July 14, 2026 upon the sale of the Ritz-Carlton Sarasota (Sarasota, Florida), the Hotel Yountville (Yountville, California) and the Bardessono Hotel and Spa (Yountville, California) and in connection therewith, the Company has paid the Termination Payments to Ashford in full simultaneously with the execution of this Agreement immediately following which the Advisory Agreement and the Letter Agreement shall be terminated (other than such provisions of such agreements identified expressly as surviving in Annex I hereto) (the “Advisory Agreement Termination”);
WHEREAS, as a result of the Advisory Agreement Termination, (i) Braemar is required to reimburse Ashford for all expenses due and payable to Ashford pursuant to Section 5 of the Advisory Agreement and (ii) Ashford is required to pay over all money collected and held for the account of Braemar, subject to certain permitted deductions, pursuant to Section 12.5(d) of the Advisory Agreement (the amounts described in the foregoing clauses (i) and (ii), the “Settlement Amounts”), and the agreed upon estimate of the Settlement Amounts is set forth on the settlement statement attached hereto as Annex II (the “Settlement Statement”);
WHEREAS, in connection with the Company Sale Transaction, the Company has paid Ashford the net amount of the Settlement Amounts (the “Expense Reimbursement”) simultaneously with the execution of this Agreement;
WHEREAS, the Company and the Advisor desire to waive the sixty (60) day notice period required by Section 1 of the Letter Agreement Amendment (the “Advisory Agreement Notice Period”) in connection with the Advisory Agreement Termination and, as a result thereof, the Advisor is forfeiting any fees that would otherwise have accrued and be payable to the Advisor during such notice period had it not been so waived (the “Notice Waiver and Fee Forfeiture”); and
WHEREAS, in furtherance of the Internalization, immediately following the payment of the Termination Payments and the Expense Reimbursement, the Parties desire to terminate the Advisory Agreement, the Letter Agreement and each of the other Contracts set forth on Annex I (other than such provisions of such agreements identified expressly as surviving in Annex I hereto) (collectively, the “Terminating Contracts”).
For good and valuable consideration, including the termination of the Terminating Contracts and the Notice Waiver and Fee Forfeiture, the Parties hereto hereby agree as follows:
Section 1. Definitions.
Capitalized terms used but not defined in this Agreement shall have the meanings given to them in the Advisory Agreement or, if not defined therein, in the Letter Agreement. The terms defined in this Section 1, whenever used herein, shall have the following meanings for all purposes of this Agreement:
“Affiliate” of a Person shall mean (i) any other Person that is directly or indirectly (through one or more intermediaries) controlled by, under common control with, or controlling such Person, or (ii) any other Person in which such Person has a direct or indirect equity interest constituting at least a majority interest of the total equity of such other Person. For purposes of this definition, “control” shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of any Person or the power to veto major policy decisions of any Person, whether through the ownership of voting securities, by contract or otherwise. For the avoidance of doubt, for purposes of this Agreement, Braemar and its controlled Affiliates shall not be considered Affiliates of the Ashford Parties.
“Braemar Master Project Management Agreement” means the Braemar Master Project Management Agreement, dated as of August 8, 2018, by and among Braemar TRS Corporation, CHH III Tenant Parent Corp., RC Hotels (Virgin Islands), Inc., Braemar Hospitality Limited Partnership and Project Management LLC (“Premier”), as amended by that certain Amendment No. 1 to the Braemar Master Project Management Agreement, as further amended by that certain Amendment No. 2 to the Braemar Master Project Management Agreement, dated as of February 12, 2024, by and among Braemar TRS Corporation, CHH III Tenant Parent Corp., RC Hotels (Virgin Islands), Inc., Premier Project Management LLC, and Braemar Hospitality Limited Partnership.
“Contract” shall mean any written or oral agreement, contract, side letter, subcontract, lease, sublease, license, sublicense, instrument, note, bond, mortgage, indenture, arrangement, understanding, guarantees, indemnities, commitment or other binding obligation, in each case, entered into between or among any Braemar Party or any of their Affiliates, on the one hand, and any Ashford Party or any of their Affiliates, on the other hand.
“Effective Time” means such time as immediately follows the receipt of the Termination Payments and the Expense Reimbursement by Ashford.
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Section 2. Termination.
(a) Other than as specifically set forth herein, at the Effective Time, (i) each of the Braemar Parties, on behalf of itself and each of its Affiliates, and each of the Ashford Parties, on behalf of itself and each of its Affiliates, hereby settle, terminate, and cancel, as applicable, in all respects without any further liability to, or obligations of, the Braemar Parties and the Ashford Parties that are party thereto, the Terminating Contracts and all rights and obligations of any kind or nature of the parties to the Terminating Contracts pursuant thereto (other than such provisions of such agreements identified expressly as surviving in Annex I hereto), and (ii) each Party, on behalf of itself and each of its Affiliates, hereby irrevocably waives any and all notice periods, cure periods, waiting periods or other similar procedural requirements that may be required under any Terminating Contract as a condition to the termination, cancellation or non-renewal thereof (which, for the avoidance of doubt, includes the Advisory Agreement Notice Period). For the avoidance of doubt, nothing in this Section 2 shall terminate, cancel or otherwise affect the surviving provisions of the Terminating Contracts expressly set forth in Annex I hereto, which shall remain in full force and effect in accordance with their respective terms.
(b) Notwithstanding anything to the contrary herein, the Parties acknowledge and agree that (i) the Braemar Master Project Management Agreement is continuing in effect solely as an accommodation to Braemar, at Braemar’s request, in order to complete, in the most efficient and cost-effective manner, capital expenditure projects that were commenced prior to the date hereof and (ii) Braemar has the right, in its sole discretion, to terminate the Braemar Master Project Management Agreement upon (A) five (5) days’ prior written notice to Ashford and (B) payment to Ashford of all outstanding amounts that are accrued but unpaid for services rendered under the applicable agreement as of the date of such termination.
(c) Notwithstanding anything to the contrary herein, to effect an orderly transition of information technology systems and to maintain, during such transition, the Braemar Parties’ internal control over financial reporting required under the Sarbanes-Oxley Act of 2002 in connection with the Braemar Parties’ reporting obligations under the Securities Exchange Act of 1934 in good faith and in the normal course of business, and to support related internal and external audit requirements, the Ashford Parties shall permit:
(i) Employees of the Braemar Parties who, as of the date hereof, use the Ashford Parties’ Oracle enterprise resource planning system (“Oracle”), to continue to access such systems solely with respect to data relating to the operation of Braemar’s business (“Braemar Data”) on a read-only basis for a period beginning from the date hereof and ending upon the filing of the Braemar Form 10-K for the year ending December 31, 2026, which shall be filed no later than March 31, 2027. For the avoidance of doubt, such continued access to Oracle shall not be deemed to reinstate, extend or create any Contract, and nothing in this Section 2(c) shall obligate the Ashford Parties to maintain any particular system beyond the ordinary course of their own business and under no circumstances may employees of the Braemar Parties have write or edit access to Oracle or access to any data other than Braemar Data. The Ashford Parties reserve the right to remove such access from employees of the Braemar Parties with ten (10) days’ written notice; provided, that Ashford may so remove access from such employees immediately and without notice if Ashford believes in good faith that any Braemar Party or their employees or representatives have violated this clause (i).
(ii) The Braemar Parties to complete the IT data migration of designated Microsoft Outlook email account files, OneDrive account files and Sharepoint files (in accordance with the scope and procedures agreed by the Ashford Parties and Braemar Parties) promptly and in no event to exceed thirty (30) days after the date hereof.
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Section 3. Transition.
(a) Books and Records. Notwithstanding anything to the contrary in the Advisory Agreement, as promptly as reasonably practicable following the Effective Time, the Advisor shall use commercially reasonable efforts to, in accordance with Section 10 of the Advisory Agreement and in accordance with the scope and procedures mutually agreed by the Ashford Parties and the Braemar Parties, deliver to Braemar all books, records, documents, files and contracts of the Braemar Parties in the possession or control of any Ashford Party, including the Braemar Parties’ general ledger and sub-ledgers and their fixed asset, tax, payroll, contract, insurance, litigation, and Board and committee records, in the electronic formats in which they are maintained in the ordinary course.
| (b) | Insurance. |
(i) The Ashford Parties shall use commercially reasonable efforts to continue to administer, in the ordinary course and consistent with past practice, each insurance policy issued prior to the Effective Time under which one or more of the Braemar Parties (or any of their current or former directors, officers or employees) and one or more of the Ashford Parties are insureds, including the directors’ and officers’ liability tail policy taking effect in connection with the transactions contemplated in this Agreement (collectively, the “Shared Policies”). The Ashford Parties shall have primary responsibility for all Shared Policies and will use commercially reasonable efforts to continue to administer and pursue coverage, or cause to be administered or for coverage to be so pursued, in the ordinary course, all losses or claims (whenever occurring) under such policies, including those that are for the benefit of the Braemar Parties and any natural person insureds who may cease serving in an insured capacity. For the avoidance of doubt, the Ashford Parties shall have primary responsibility for all claims for coverage under the Shared Policies, including without limitation those arising out of occurrences, facts, circumstances, events or matters prior to or after the Effective Time.
(ii) The Ashford Parties and Braemar Parties shall keep each other reasonably informed of, and shall promptly provide to each other copies of all material notices concerning any claim under a Shared Policy related to any Braemar Party or any of its current or former directors, officers or employees.
(iii) The Parties agree that no insurance claim submitted under any Shared Policy shall be settled without the mutual consent of both Parties and Ashford Hospitality Trust, Inc., which consent shall not be unreasonably withheld or delayed.
(iv) None of the Parties, nor Ashford Hospitality Trust, Inc. shall knowingly take any action after the Effective Time that would reasonably be expected to cause any Shared Policy to be terminated, amended, or materially altered in terms of the scope of coverage.
| (c) | Further Cooperation. |
(i) In addition to the foregoing, each Ashford Party shall, at the reasonable request of Braemar, cooperate with and provide reasonable assistance to the Braemar Parties, consistent with Section 12.5(d)(iv) of the Advisory Agreement, in connection with (A) effecting an orderly transition of the management of the Braemar Parties’ business and assets to the Braemar Parties, (B) any litigation, arbitration, investigation or other proceeding brought by or involving a third party (whether pending, threatened or hereafter commenced) arising out of or relating to the business or operations of the Braemar Parties prior to the Effective Time, including by making available relevant books, records, and documents and making current employees and representatives of the Ashford Parties reasonably available for interviews, depositions or testimony, and (C) any other matters arising out of or relating to the Terminating Contracts or the operation of the Braemar Parties’ business prior to the Effective Time, in each case, excluding any Claims released pursuant to Section 4 or any matter as to which cooperation is addressed elsewhere in this Agreement.
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(ii) In addition to the foregoing, each Braemar Party shall, at the reasonable request of any Ashford Party, cooperate with and provide reasonable assistance to the Ashford Parties in connection with (A) effecting an orderly transition of the management of the Braemar Parties’ business and assets to the Braemar Parties, (B) any litigation, arbitration, investigation or other proceeding brought by or involving a third party (whether pending, threatened or hereafter commenced) arising out of or relating to the business or operations of the Braemar Parties prior to the Effective Time, including by making available relevant books, records and documents and making current employees and representatives of the Braemar Parties reasonably available for interviews, depositions or testimony, and (C) any other matters arising out of or relating to the Terminating Contracts or the operation of the Braemar Parties’ business prior to the Effective Time, in each case, excluding any Claims released pursuant to Section 4 or any matter as to which cooperation is addressed elsewhere in this Agreement.
(iii) Each Party shall bear its own costs and expenses incurred in connection with cooperation provided under clause (i) or clause (ii) above, except that, if such cooperation relates to an Ashford Indemnifiable Claim or a Braemar Indemnifiable Claim, the costs and expenses thereof shall be governed by Section 5.
Section 4. Releases.
(a) Effective immediately following the receipt of the Termination Payments and the Expense Reimbursement by Ashford, each of the Braemar Parties, on behalf of itself and each of its Affiliates, hereby irrevocably and unconditionally releases and discharges the Ashford Parties and their Affiliates, and each of their respective past, present or future partners, equityholders, Affiliates, directors, managers, officers, employees, counsel, agents and successors and assigns (the “Ashford Released Parties”) from any and all Claims, which it has now or may have in the future, whether known or unknown, based upon any events that have occurred prior to the Effective Time, and agrees that it shall not, and shall cause its Affiliates not to assert any Claim against any Ashford Released Party; provided, however, that nothing in this Section 4 shall constitute a release or discharge of (i) any Claims arising under or relating to this Agreement, (ii) the surviving provisions of the Terminating Contracts expressly set forth in Annex I hereto, or (iii) any Claims arising under or relating to any Contracts between the Braemar Parties, on the one hand, and the Ashford Parties, on the other, that are not Terminating Contracts.
(b) Effective immediately following the receipt of the Termination Payments and the Expense Reimbursement by Ashford, each of the Ashford Parties, on behalf of itself and each of its Affiliates, hereby irrevocably and unconditionally releases and discharges its past or present directors and officers and the Braemar Parties and their Affiliates, and each of their respective past, present or future partners, equityholders, Affiliates, directors, managers, officers, employees, counsel, agents and successors and assigns (the “Braemar Released Parties”) from any and all Claims, which it has now or may have in the future, whether known or unknown, based upon any events that have occurred prior to the Effective Time, and agrees that it shall not, and shall cause its Affiliates not to assert any Claim against any Braemar Released Party; provided, however, that nothing in this Section 4 shall constitute a release or discharge of (i) any Claims arising under or relating to this Agreement, (ii) the surviving provisions of the Terminating Contracts expressly set forth in Annex I hereto, or (iii) any Claims arising under or relating to any Contracts between the Braemar Parties, on the one hand, and the Ashford Parties, on the other, that are not Terminating Contracts.
(c) Each of the Ashford Released Parties and the Braemar Released Parties not a party hereto shall be an intended third-party beneficiary of this release and its related terms and shall have the right to enforce the provisions of this Section 4 and its related terms as if such Person were a party hereto.
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Section 5. Indemnification and Advancement.
(a) The Braemar Parties, on behalf of themselves and each of their Affiliates, shall indemnify, defend, and hold harmless the Ashford Released Parties from and against any and all losses, damages, liabilities, claims, demands, actions, judgments, costs, expenses (including attorneys’ fees), arising out of or relating to any breach by any of the Braemar Parties of any covenant or obligation under this Agreement, whether or not involving a claim by a third party (hereinafter an “Ashford Indemnifiable Claim”). The Braemar Parties shall advance all expenses reasonably estimated by any third-party advisor to be incurred, or that are actually incurred, by any of the Ashford Released Parties (hereinafter “Ashford Indemnitee”) in connection with an Ashford Indemnifiable Claim within five (5) business days after receipt of a statement requesting such advances from time to time, whether prior to or after final disposition of any Ashford Indemnifiable Claim. Such advances shall be unsecured and interest free and shall be made without regard to Ashford Indemnitee’s ability to repay the expenses and without regard to Ashford Indemnitee’s ultimate entitlement to indemnification. Ashford Indemnitee shall be entitled to continue to receive advancement of expenses unless and until the matter of Ashford Indemnitee’s entitlement to indemnification hereunder has been finally adjudicated by court order or judgment from which no further right of appeal exists. Ashford Indemnitee hereby undertakes to repay such amounts advanced only if, and to the extent that, it ultimately is determined that Ashford Indemnitee is not entitled to be indemnified. Ashford Indemnitee shall qualify for advances upon the execution and delivery of this Agreement, which shall constitute the requisite undertaking with respect to repayment of advances made hereunder and no other form of undertaking shall be required to qualify for advances made hereunder.
(b) The Ashford Parties, on behalf of themselves and each of their Affiliates, shall indemnify, defend, and hold harmless the Braemar Released Parties from and against any and all losses, damages, liabilities, claims, demands, actions, judgments, costs, expenses (including attorneys’ fees), arising out of or relating to any breach by any of the Ashford Parties of any covenant or obligation under this Agreement, whether or not involving a claim by a third party (hereinafter a “Braemar Indemnifiable Claim”). The Ashford Parties shall advance all expenses reasonably estimated by any third-party advisor to be incurred, or that are actually incurred, by any of the Braemar Released Parties (hereinafter “Braemar Indemnitee”) in connection with a Braemar Indemnifiable Claim within five (5) business days after receipt of a statement requesting such advances from time to time, whether prior to or after final disposition of any Braemar Indemnifiable Claim. Such advances shall be unsecured and interest free and shall be made without regard to Braemar Indemnitee’s ability to repay the expenses and without regard to Braemar Indemnitee’s ultimate entitlement to indemnification. Braemar Indemnitee shall be entitled to continue to receive advancement of expenses unless and until the matter of Braemar Indemnitee’s entitlement to indemnification hereunder has been finally adjudicated by court order or judgment from which no further right of appeal exists. Braemar Indemnitee hereby undertakes to repay such amounts advanced only if, and to the extent that, it ultimately is determined that Braemar Indemnitee is not entitled to be indemnified. Braemar Indemnitee shall qualify for advances upon the execution and delivery of this Agreement, which shall constitute the requisite undertaking with respect to repayment of advances made hereunder and no other form of undertaking shall be required to qualify for advances made hereunder.
Section 6. Company Sale Fee.
(a) The Parties acknowledge and agree that, as provided in Section 2(a) of the Letter Agreement, the Company Sale Fee is a negotiated amount that the Advisor agreed to accept in lieu of (and as payment in full of) the Full Termination Payment, and that Section 5 of the Letter Agreement survives the termination of the Letter Agreement as provided in Annex I and shall continue to bind the Parties and their respective successors and assigns.
(b) Notwithstanding anything to the contrary in the Advisory Agreement, the Letter Agreement or this Agreement, in the event that the Company commences or intervenes to pursue directly an action or proceeding against any Ashford Party challenging (i) the validity or enforceability of this Agreement, the Advisory Agreement or the Letter Agreement or any provision thereof (including, but not limited to, by seeking rescission thereof), or (ii) the amount or payment of the Termination Payments or (iii) seeks recoupment of all or any portion of the Termination Payments, then the amount due and payable to the Advisor by the Company pursuant to Section 12.5(b) of the Advisory Agreement (excluding Accrued Fees) and the Letter Agreement upon a Company Sale Transaction shall be deemed to be the amount of the Full Termination Payment and the Advisor shall be entitled to recover against the Company the amount by which the Full Termination Payment exceeds the Company Sale Fee. This Section 6(b) shall not apply to (A) any action or proceeding commenced by any stockholder of Braemar (whether directly or derivatively), so long as the Company does not intervene to pursue such action or proceeding directly against any Ashford Party; or (B) any proceeding under Section 9(c) of this Agreement.
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Section 7. Confidentiality.
Each Party agrees that, from and after the date hereof, it shall, and shall cause its Affiliates and its and their respective directors, managers, officers, employees, counsel, agents and representatives (collectively, “Representatives”) to, keep confidential and not disclose to any third party, and not use for any purpose other than as contemplated by this Agreement, any and all confidential or proprietary information furnished by or on behalf of any other Party or its Affiliates in connection with the Terminating Contracts, the Advisory Agreement, the Letter Agreement, or this Agreement (collectively, “Confidential Information”); provided, that Confidential Information shall not include information that (a) is or becomes generally available to the public other than as a result of a breach of this Section 7, (b) was already in the possession of the receiving Party or its Representatives on a non-confidential basis prior to disclosure by the disclosing Party, (c) is or becomes available to the receiving Party or its Representatives on a non-confidential basis from a source other than the disclosing Party or its Representatives, provided that such source is not known by the receiving Party to be bound by a confidentiality obligation to the disclosing Party with respect thereto, or (d) is independently developed by the receiving Party or its Representatives without reference to or use of any Confidential Information. Notwithstanding the foregoing, a Party or its Representatives may disclose Confidential Information to the extent required by applicable law, regulation, legal process or governmental or regulatory authority, provided that such Party shall, to the extent legally permitted, (i) promptly notify the disclosing Party of such requirement prior to any such disclosure and (ii) cooperate with the disclosing Party, at the disclosing Party’s sole cost and expense, in seeking a protective order or other appropriate remedy to limit such disclosure. Each Party shall be responsible for any breach of this Section 7 by any of its Representatives. Notwithstanding anything to the contrary in this Section 7,
(i) the books and records of the Braemar Parties, including those compiled by the Advisor and delivered pursuant to Section 3(a), are property of the Braemar Parties and shall not constitute Confidential Information of any Ashford Party; (ii) nothing in this Section 7 shall restrict any Party from using or disclosing information as required by law (A) in any filing with, or report to, the Securities and Exchange Commission or any securities exchange, (B) to its auditors, lenders, insurers, counsel and other advisors, or (C) in connection with the defense or prosecution of any litigation, arbitration, investigation or other proceeding; and (iii) as between the Company and the Advisor, Section 11 of the Advisory Agreement shall continue to apply in accordance with Annex I.
Section 8. Further Assurances.
Each Party, upon the reasonable request from time to time of any other Party, and without further consideration, will use commercially reasonable efforts to, and will cause its respective Affiliates to, do each and every act and thing as may be reasonably necessary to consummate the transactions contemplated hereby and to execute and deliver such additional documents, instruments or other agreements to give effect to the transactions contemplated hereby. Without limiting the foregoing, the Ashford Parties shall use commercially reasonable efforts to execute and deliver such UCC termination statements, account signatory changes, notices to lenders, hotel managers, insurers and vendors, and other instruments as Braemar may reasonably request to evidence the termination of the Terminating Contracts and the matters set forth in Section 3.
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Section 9. Misallocated Assets or Payments.
(a) If, following the date hereof, any right, property, asset or payment that is part of the business or operations of any of the Braemar Parties is found to be held, or is received, by any of the Ashford Parties, the Ashford Parties shall transfer such right, property or asset, or remit such payment, as applicable, to Braemar or its designee promptly (but in the case of a payment obligation, within five (5) business days after any Ashford Party obtains actual knowledge of the receipt of the applicable sum by any Ashford Party). Until such time as the Ashford Parties transfer or remit the foregoing in accordance with this Section 9, such party shall hold such right, property, asset or payment in trust until such time as the transfer is completed for no additional consideration.
(b) If, following the date hereof, any right, property, asset or payment that is part of the business or operations of any of the Ashford Parties is found to be held, or is received, by any of the Braemar Parties, the Braemar Parties shall transfer such right, property or asset, or remit such payment, as applicable, to Ashford or its designee promptly (but in the case of a payment obligation, within five (5) business days of the receipt of the applicable sum by any Braemar Party). Until such time as the Braemar Parties transfer or remit the foregoing in accordance with this Section 9, such party shall hold such right, property, asset or payment in trust until such time as the transfer is completed for no additional consideration.
(c) The Parties acknowledge that the Settlement Amounts are based on good faith estimates of the Parties and therefore the Parties will negotiate in good faith to attempt to agree to any necessary adjustments to such amounts that may be required to reconcile such estimates to actual amounts received or paid after the Effective Time (the net amount of any such adjusted amounts, the “Final Expense Reimbursement”) within sixty (60) days following the date hereof (the “Reimbursement Deadline”). Such reconciliation will be reasonably documented in a manner acceptable to the Parties in good faith for purposes of their books and records. If the Parties have not agreed upon the Final Expense Reimbursement by the Reimbursement Deadline, the Ashford Parties and the Braemar Parties will each prepare a proposed statement setting forth their respective determination of the Final Expense Reimbursement, together with supporting detail, and such statements shall be submitted within thirty (30) days following the Reimbursement Deadline to BDO USA, LLP or another independent firm of certified accountants mutually selected by the Parties (the “Accounting Arbitrator”), who shall determine the Final Expense Reimbursement. The Accounting Arbitrator shall determine the Final Expense Reimbursement within ninety (90) days following the Reimbursement Deadline on the basis of the Advisory Agreement, this Agreement and the statements of the Parties. Absent manifest error, actual and intentional fraud, or willful misconduct, the decision of the Accounting Arbitrator shall be final and binding on the Parties. Upon a determination of the Final Expense Reimbursement, either by agreement of the Parties or by the Accounting Arbitrator, the difference between the Expense Reimbursement and the Final Expense Reimbursement shall be paid by wire transfer of immediately available funds by the applicable Party to the other Party within three (3) business days following such determination. The costs, fees and expenses of the Accounting Arbitrator shall be borne by each Party in the same proportion as the aggregate amount of the disputed amounts submitted to the Accounting Arbitrator with respect to the Final Expense Reimbursement that are unsuccessfully disputed by each such Party (as finally determined by the Accounting Arbitrator) bears to the total amount of disputed amounts so submitted. For the avoidance of doubt, the submission of any matter to the Accounting Arbitrator in accordance with this Section 9(c) shall not constitute a breach of, or a challenge to, this Agreement, the Advisory Agreement or the Letter Agreement.
Section 10. Miscellaneous.
(a) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Texas, without regard to the conflict of laws principles thereof.
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(b) WAIVER OF JURY TRIAL. EACH PARTY HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT.
(c) Effect; Assignment. This Agreement shall inure to the benefit of and be binding upon the Parties and their respective successors and permitted assigns. No Party may assign this Agreement or any of its rights or obligations hereunder without the prior written consent of the other Parties.
(d) Amendment and Modification. This Agreement shall not be altered or otherwise amended in any respect, except pursuant to an instrument in writing signed by the Parties. The waiver by a Party of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any subsequent breach.
(e) Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original, and all of which shall constitute one and the same agreement.
(f) Severability. If any provision of this Agreement is held to be prohibited by law or invalid, then such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating or affecting in any manner whatsoever the remainder of such provision or the remaining provisions of this Agreement.
[Remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date first written above.
| BRAEMAR PARTIES: | ||
| BRAEMAR HOTELS & RESORTS INC. | ||
| By: | /s/ Richard J. Stockton | |
| Name: Richard J. Stockton | ||
| Title: President & Chief Executive Officer | ||
| BRAEMAR HOSPITALITY LIMITED PARTNERSHIP | ||
| By: Braemar OP General Partner LLC, its general partner | ||
| By: | /s/ Richard J. Stockton | |
| Name: Richard J. Stockton | ||
| Title: President & Chief Executive Officer | ||
| BRAEMAR TRS CORPORATION | ||
| By: | /s/ Jim Plohg | |
| Name: | Jim Plohg | |
| Title: | President | |
| CHH III TENANT PARENT CORP. | ||
| By: | /s/ Jim Plohg | |
| Name: | Jim Plohg | |
| Title: | President | |
[Signature Page to Termination and Release Agreement]
| RC HOTELS (VIRGIN ISLANDS), INC. | ||
| By: | /s/ Richard J. Stockton | |
| Name: | Richard J. Stockton | |
| Title: | President | |
| BHR SCOTTSDALE LP | ||
| By: BHR Scottsdale GP LLC, its general partner | ||
| By: | /s/ Richard J. Stockton | |
| Name: | Richard J. Stockton | |
| Title: | President | |
| BHR BEVERLY HILLS LP | ||
| By: BHR Beverly Hills GP LLC, its general partner | ||
| By: | /s/ Richard J. Stockton | |
| Name: | Richard J. Stockton | |
| Title: | President | |
| CHH CAPITAL HOTEL PARTNERS, LP | ||
| By: CHH Capital Hotel GP LLC, its general partner | ||
| By: | /s/ Richard J. Stockton | |
| Name: | Richard J. Stockton | |
| Title: | President | |
| ASHFORD PHILADELPHIA ANNEX LP | ||
| By: Ashford Chicago Senior Mezz LLC, its general partner | ||
| By: | /s/ Richard J. Stockton | |
| Name: | Richard J. Stockton | |
| Title: | President | |
[Signature Page to Termination and Release Agreement]
| BHR TAHOE LP | ||
| By: BHR Tahoe GP LLC, its general partner | ||
| By: | /s/ Richard J. Stockton | |
| Name: | Richard J. Stockton | |
| Title: | President | |
| ASHFORD CHICAGO LP | ||
| By: Ashford Chicago Senior Mezz LLC, its general partner | ||
| By: | /s/ Richard J. Stockton | |
| Name: | Richard J. Stockton | |
| Title: | President | |
| BHR Dorado LLC | ||
| By: | /s/ Richard J. Stockton | |
| Name: | Richard J. Stockton | |
| Title: | President | |
| BHR TRS BEVERLY HILLS LLC | ||
| By: | /s/ Jim Plohg | |
| Name: | Jim Plohg | |
| Title: | President | |
| BHR TRS SCOTTSDALE LLC | ||
| By: | /s/ Jim Plohg | |
| Name: | Jim Plohg | |
| Title: | President | |
| BHR TRS DORADO LLC | ||
| By: | /s/ Jim Plohg | |
| Name: | Jim Plohg | |
| Title: | President | |
[Signature Page to Termination and Release Agreement]
| BHR TRS TAHOE LLC | ||
| By: | /s/ Jim Plohg | |
| Name: | Jim Plohg | |
| Title: | President | |
| ASHFORD TRS PHILADELPHIA ANNEX LLC | ||
| By: | /s/ Jim Plohg | |
| Name: | Jim Plohg | |
| Title: | President | |
| ASHFORD TRS CHICAGO II LLC | ||
| By: | /s/ Jim Plohg | |
| Name: | Jim Plohg | |
| Title: | President | |
[Signature Page to Termination and Release Agreement]
| ASHFORD PARTIES: | ||
| ASHFORD INC. | ||
| By: | /s/ Hector Sanchez | |
| Name: | Hector Sanchez | |
| Title: | President | |
| ASHFORD HOSPITALITY ADVISORS LLC | ||
| By: | /s/ Eric Batis | |
| Name: | Eric Batis | |
| Title: | Chief Executive Officer | |
| ASHFORD HOSPITALITY TRUST, INC. | ||
| By: | /s/ Stephen Zsigray | |
| Name: | Stephen Zsigray | |
| Title: | President & Chief Executive Officer | |
| ASHFORD HOSPITALITY LIMITED PARTNERSHIP | ||
| By: Ashford OP General Partner LLC, its general partner | ||
| By: | /s/ Stephen Zsigray | |
| Name: | Stephen Zsigray | |
| Title: | President & Chief Executive Officer | |
| ASHFORD TRS CORPORATION | ||
| By: | /s/ Jim Plohg | |
| Name: | Jim Plohg | |
| Title: | President | |
[Signature Page to Termination and Release Agreement]
| PREMIER PROJECT MANAGEMENT LLC | ||
| By: | /s/ Johannes Michalsky | |
| Name: | Johannes Michalsky | |
| Title: | Chief Executive Officer | |
| REMINGTON LODGING & HOSPITALITY, LLC | ||
| By: | /s/ Ben Perelmuter | |
| Name: | Ben Perelmuter | |
| Title: | Chief Executive Officer | |
| LISMORE CAPITAL II LLC | ||
| By: | /s/ Eric Batis | |
| Name: | Eric Batis | |
| Title: | President | |
| WARWICK INSURANCE COMPANY, LLC | ||
| By: | /s/ Bobby Nandipati | |
| Name: | Bobby Nandipati | |
| Title: | President | |
| PRE OPCO, LLC | ||
| By: | /s/ Ben Perelmuter | |
| Name: | Ben Perelmuter | |
| Title: | Managing Director | |
| RED HOSPITALITY TRANSPORTATION LLC | ||
| By: | /s/ Chris Batchelor | |
| Name: | Chris Batchelor | |
| Title: | President | |
[Signature Page to Termination and Release Agreement]
| ISLAND TIME WATERSPORTS (CARIBBEAN) LLC | ||
| By: | /s/ Chris Batchelor | |
| Name: | Chris Batchelor | |
| Title: | President | |
| INSPIRE EVENT TECHNOLOGIES, LLC | ||
| By: | /s/ Martin Perez | |
| Name: | Martin Perez | |
| Title: | Chief Executive Officer | |
| REMINGTON CHICAGO EMPLOYERS, LLC | ||
| By: | /s/ Ben Perelmuter | |
| Name: | Ben Perelmuter | |
| Title: | Chief Executive Officer | |
| BEVERLY HILLS HOTEL MANAGEMENT LLC | ||
| By: | /s/ Ben Perelmuter | |
| Name: | Ben Perelmuter | |
| Title: | Chief Executive Officer | |
[Signature Page to Termination and Release Agreement]
Annex I
Terminating Contracts
The following Contracts (provided that, with respect to the Contracts set forth in items 3 through 18 below, any provision of any such Contracts that, by its terms, is intended to survive the termination of such Contract shall survive the termination of such Contract in accordance with its terms; provided further that, notwithstanding anything to the contrary herein or therein, with respect to the Contracts set forth in items 1 and 2 below, only such provisions survive as specified in this Annex I):
| 1. | Advisory Agreement; provided, that Sections 8.1, 8.3, 9.5, 10, 11, and 12.6 of the Advisory Agreement shall survive such termination; provided, further, that Section 12.6 of the Advisory Agreement shall not apply to the solicitation or hiring of any employees of the Ashford Parties or their respective Affiliates who transfer employment to any of the Braemar Parties or their respective Affiliates as of the date hereof in connection with the internalization of Braemar’s management. |
| 2. | Letter Agreement; provided, that Section 5 (Independent Review and Reliance) of the Letter Agreement shall survive such termination in accordance with its terms. |
| 3. | Amended and Restated Braemar Hotel Master Management Agreement, dated as of August 8, 2018, by and among Braemar TRS Corporation, CHH III Tenant Parent Corp., RC Hotels (Virgin Islands), Inc. and Remington Lodging & Hospitality, LLC and certain landlords party thereto, as modified by certain addenda, including that certain Addendum to the Braemar Master Hotel Management Agreement, dated as of August 5, 2021 relating to the Cameo Beverly Hills hotel and that certain Addendum to the Braemar Master Hotel Management Agreement, relating to the Sofitel Chicago Magnificent Mile. |
| 4. | Letter Agreement (with respect to cash services), dated as of September 27, 2022, by and among Braemar, Braemar Hospitality Limited Partnership, Braemar TRS Corporation, Ashford, and Ashford Hospitality Advisors LLC, and Braemar. |
| 5. | Design and Construction Services Agreement by and between Braemar (or its applicable subsidiary) and Premier Project Management LLC. |
| 6. | Refinancing for The Ritz-Carlton Reserve Dorado Beach and the BHR 4-Pack (The Clancy, The Notary, Marriott Seattle and Sofitel Chicago), dated as of August 16, 2024, by and between Lismore Capital II LLC and Braemar. |
| 7. | Fourth Amended and Restated Contribution Agreement, effective as of January 1, 2024, by and among Ashford, Ashford Hospitality Trust, Inc. and Braemar. |
| 8. | Wind-Down and Investor Servicing Cost Sharing Agreement, effective as of December 9, 2025, by and among Ashford, Ashford Hospitality Trust, Inc. and Braemar. |
| 9. | Separation and Distribution Agreement, dated as of November 8, 2013, by and among Braemar, Ashford Hospitality Trust, Inc., and the other parties thereto, as amended by that certain Separation and Distribution Agreement Correction, dated as of November 8, 2013. |
| 10. | Right of First Offer Agreement, dated as of November 19, 2013, by and between Braemar and Ashford Hospitality Trust, Inc. |
| 11. | Option Agreement Pier House Resort & Spa, dated as of November 19, 2013, by and among Braemar Hospitality Limited Partnership and Ashford Hospitality Limited Partnership with respect to the Properties Entities, and Ashford TRS Corporation and Ashford Prime TRS Corporation with respect to the TRS Entity. |
| 12. | Amended and Restated Braemar Mutual Exclusivity Agreement, dated as of August 8, 2018, by and among Braemar Hospitality Limited Partnership, Braemar and Remington Lodging & Hospitality, LLC. |
| 13. | Braemar Mutual Exclusivity Agreement, dated as of August 8, 2018, by and among Braemar Hospitality Limited Partnership, Braemar and Premier Project Management LLC (f/k/a Project Management LLC). |
| 14. | Licensing Agreement, dated as of November 19, 2013, by and among Ashford Hospitality Trust, Inc., Braemar, and Braemar Hospitality Limited Partnership. |
| 15. | Casualty insurance arrangement with Warwick Insurance Company, LLC, a subsidiary of Ashford, effective as of December 19, 2023, pursuant to which Warwick provides general liability, workers’ compensation and business automobile insurance policies to Braemar. |
| 16. | Preferred Service Provider Master Services Agreement, dated as of July 1, 2023, by and between Ashford and Evolution Parking & Guest Services, LLC. |
| 17. | Insurance claims services arrangement with Ashford LLC, a subsidiary of Ashford. |
| 18. | Agreement(s) with Ashford Securities LLC, a subsidiary of Ashford, relating to broker/dealer and dealer manager services. |
| 19. | Office Space Cost Sharing Agreement, dated as of August 10, 2018, by and among Ashford Hospitality Trust, Inc., Ashford, Braemar and Remington Hotel Corporation. |
Annex II
Settlement Statement
Attached.
[Signature Page to Termination and Release Agreement]
BHR (Due To)/Due From Ashford Inc. Settlement Estimate
Prepared November 8, 2026
| Advisory reimbursement expenses* | $ | - | ||
| INSPIRE corporate office security deposit due to AINC | (34,000 | ) | ||
| Corporate office prepaid rent/security deposit due from AINC | 365,000 | |||
| BHR Deferred cash | (13,770,644 | ) | ||
| Accrued advisory incentive fee | (1,850,000 | ) | ||
| Severance reimbursement | (2,175,000 | ) | ||
| Property insurance refunds | 2,008,000 | |||
| Remington corporate working capital refund | 500,000 | |||
| Al Shams Legal Costs | 579,039 | |||
| Remington property level fees and rebills | (531,616 | ) | ||
| $ | (14,909,221 | ) |
Note: No settlement of Premier amounts (transitioning post-November 10). INSPIRE, Pure & RED continuing.
* Cash settled prior to November 10
Exhibit 10.2
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into this 10th day of November, 2026, by and among BHR Luxury Hotels Management, LLC, a Texas limited liability company (the “Company”), Braemar Hotels & Resorts Inc., a Maryland corporation (“Parent”), and Richard J. Stockton (the “Executive”).
RECITALS
THE PARTIES ENTER THIS AGREEMENT on the basis of the following facts, understandings and intentions:
A. The Company desires to offer the Executive the benefits set forth in this Agreement and provide for the services of the Executive on the terms and conditions set forth in this Agreement.
B. The Executive desires to be employed by the Company on the terms and conditions set forth in this Agreement.
C. This Agreement shall govern the employment relationship between the Executive and the Company and all of its Affiliates effective as of the Effective Date (as defined below), and supersedes and negates any previous agreements with respect to such relationship.
AGREEMENT
NOW, THEREFORE, in consideration of the above recitals incorporated herein and the mutual covenants and promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby expressly acknowledged, the parties agree as follows:
| 1. | Retention and Duties. |
| 1.1 | Retention. The Company does hereby agree to employ the Executive for the Period of Employment (as such term is defined in Section 2) on the terms and conditions expressly set forth in this Agreement. The Executive does hereby accept and agree to such employment, on the terms and conditions expressly set forth in this Agreement. Certain capitalized terms used herein are defined in Section 5.5 of this Agreement. |
| 1.2 | Duties. During the Period of Employment, the Executive shall serve Parent as its Chief Executive Officer and President and shall have the powers, authorities, duties and obligations generally consistent with that position as the Company may assign from time to time, all subject to the directives of the Board of Directors of Parent (the “Board”) and the corporate policies of the Company as they are in effect from time to time throughout the Period of Employment (including, without limitation, the Company’s business conduct and ethics policies, as they may change from time to time). During the Period of Employment, the Executive shall report to the Board. In the event that the Executive serves as director or senior executive officer of one or more Affiliates, the Executive shall do so without additional compensation. |
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| 1.3 | No Other Employment; Minimum Time Commitment. During the Period of Employment, the Executive shall: (i) devote substantially all of the Executive’s business time, energy and skill to the performance of the Executive’s duties for the Company; (ii) perform such duties in a faithful, effective and efficient manner to the best of the Executive’s abilities; and (iii) hold no other employment. The Executive’s service on the boards of directors (or similar body) of other public companies is subject to the prior written approval of the Board of Directors of Parent (the “Board”). The Company shall have the right to require the Executive to resign from any board or similar body (including, without limitation, any association, corporate, civic or charitable board or similar body) which the Executive may then serve if the Board reasonably determines that the Executive’s service on such board or body interferes with the effective discharge of the Executive’s duties and responsibilities to the Company or that any business related to such service is then in direct or indirect competition with any business of the Company or any of its Affiliates, successors or assigns. |
| 1.4 | No Breach of Contract. The Executive hereby represents to the Company and agrees that: (i) the execution and delivery of this Agreement by the Executive and the Company and the performance by the Executive of the Executive’s duties hereunder do not and shall not constitute a breach of, conflict with, or otherwise contravene or cause a default under, the terms of any other agreement or policy to which the Executive is a party or otherwise bound or any judgment, order or decree to which the Executive is subject; (ii) the Executive will not enter into any new agreement that would or reasonably could contravene or cause a default by the Executive under this Agreement; (iii) the Executive has no information (including, without limitation, confidential information and trade secrets) relating to any other Person which would prevent, or be violated by, the Executive entering into this Agreement or carrying out the Executive’s duties hereunder; (iv) the Executive is not bound by any employment, consulting, non-compete, non-solicitation, confidentiality, trade secret or similar agreement (other than this Agreement) with any other Person (other than ongoing, customary confidentiality obligations as to confidential information obtained from prior employers in the course of the Executive’s prior employment with them); (v) to the extent the Executive has any confidential or similar information that the Executive is not free to disclose to the Company, the Executive will not disclose or bring on to the Company’s premises, computer networks, communications or systems, computers or any other devices or accounts, any such information to the extent such disclosure or transmission would violate applicable law or any other agreement or policy to which the Executive is a party or by which the Executive is otherwise bound; (vi) the Executive has not committed any acts of sexual harassment or any other type of workplace misconduct that would interfere with Executive carrying out the Executive’s duties hereunder; and (vii) the Executive understands the Company will rely upon the accuracy and truth of the representations and warranties of the Executive set forth herein and the Executive consents to such reliance. |
| 1.5 | Location. The Executive’s principal place of employment shall be the Company’s principal executive office as it may be located from time to time. The Executive agrees that the Executive will be regularly present at that office during regular business hours (except for required business travel, holidays, vacation and other leaves consistent with this Agreement) as reasonably required and consistent with the Company’s policies regarding remote work. The Executive acknowledges that the Executive will be required to travel from time to time in the course of performing the Executive’s duties for the Company. |
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| 2. | Period of Employment. The “Period of Employment” shall be a period of three (3) years commencing on November 10, 2026 (the “Effective Date”) and ending at the close of business on the third (3rd) anniversary of the Effective Date (the “Termination Date”); provided, however, that this Agreement shall be automatically renewed, and the Period of Employment shall be automatically extended for one (1) additional year on the Termination Date and each anniversary of the Termination Date thereafter, unless either party gives written notice at least sixty (60) days prior to the expiration of the Period of Employment (including any renewal thereof) of such party’s desire to terminate the Period of Employment (such notice to be delivered in accordance with Section 18). The term “Period of Employment” shall include any extension thereof pursuant to the preceding sentence. Notwithstanding the foregoing, the Period of Employment is subject to earlier termination as provided below in this Agreement. |
| 3. | Compensation. |
| 3.1 | Base Salary. During the Period of Employment, the Company shall pay the Executive a base salary (the “Base Salary”), which shall be paid in accordance with the Company’s regular payroll practices in effect from time to time. The Executive’s Base Salary shall be at an annualized rate of $725,000. The Compensation Committee of the Board (the “Compensation Committee”) will review the Executive’s rate of Base Salary on an annual basis and may, in its sole discretion, increase (but not decrease) the Executive’s Base Salary. |
| 3.2 | Incentive Bonus. The Executive shall be eligible to receive a cash incentive bonus for each fiscal year of the Company that occurs during the Period of Employment (“Incentive Bonus”). Notwithstanding the foregoing, except as otherwise expressly provided in this Agreement, the Executive must be employed by the Company at the time the Company pays incentive bonuses to employees generally with respect to a particular fiscal year in order to earn and be eligible for an Incentive Bonus for that year (and, if the Executive is not so employed at such time, in no event shall the Executive have been considered to have “earned” any Incentive Bonus with respect to the fiscal year), except as otherwise provided herein. Beginning with the Company’s 2026 fiscal year, the Executive’s target Incentive Bonus shall equal 150% of the Base Salary, the Executive’s maximum Incentive Bonus shall equal 175% of the Base Salary, and the Executive’s threshold Incentive Bonus shall equal 75% of the Base Salary. The Executive’s actual Incentive Bonus amount for a particular fiscal year shall be determined by the Compensation Committee, based on performance objectives (which may include corporate, business unit or division, financial, strategic, individual or other objectives) established with respect to that particular fiscal year by the Compensation Committee. Any Incentive Bonus that becomes payable for a fiscal year shall be paid no later than June 1 of the year following the fiscal year for which such bonus was earned. |
| 3.3 | Long-Term Incentive Compensation. During the Period of Employment, the Executive shall be eligible to participate in the Company’s or its Affiliates’ long-term incentive or other equity incentive plans applicable to similarly situated executives, as such plans may be adopted or amended from time to time, in each case subject to the terms of such plans and award agreements thereunder. |
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| 4. | Benefits. |
| 4.1 | Retirement, Welfare and Fringe Benefits. During the Period of Employment, the Executive shall be entitled to participate, on a basis generally consistent with other similarly situated executives, in all employee pension and welfare benefit plans and programs, and fringe benefit plans and programs and all other benefit plans and programs that are made available by the Company to the Company’s other similarly situated executives generally, in accordance with the eligibility and participation provisions of such plans and as such plans or programs may be in effect from time to time. |
| 4.2 | Reimbursement of Business Expenses. The Executive is authorized to incur reasonable expenses in carrying out the Executive’s duties for the Company under this Agreement and shall be entitled to reimbursement for all reasonable business expenses the Executive incurs during the Period of Employment in connection with carrying out the Executive’s duties for the Company, subject to the Company’s expense reimbursement policies and any pre-approval policies in effect from time to time. The Executive agrees to promptly submit and document any reimbursable expenses in accordance with the Company’s expense reimbursement policies to facilitate the timely reimbursement of such expenses. |
| 4.3 | Vacation and Other Leave. During the Period of Employment, the Executive shall accrue annual vacation on the same basis as other similarly situated executives, with such vacation to accrue and be subject to the Company’s vacation policies applicable to such similarly situated executives in effect from time to time, including any unlimited vacation policy or any policy which may limit vacation accruals and/or limit the amount of accrued but unused vacation to carry over from year to year. The Executive shall also be entitled to all other holiday and leave pay generally available to other similarly situated executives of the Company. |
| 5. | Termination. |
| 5.1 | Termination by the Company. During the Period of Employment, the Executive’s employment by the Company, and the Period of Employment, may be terminated at any time by the Company: (i) with Cause; or (ii) without Cause; or (iii) in the event of the Executive’s death; or (iv) in the event that the Board determines in good faith that the Executive has a Disability. |
| 5.2 | Termination by the Executive. During the Period of Employment, the Executive’s employment by the Company, and the Period of Employment, may be terminated by the Executive with no less than thirty (30) days advance written notice to the Company (such notice to be delivered in accordance with Section 18); provided, however, that in the case of a termination for Good Reason, the Executive may provide immediate written notice of termination once the applicable cure period (as contemplated by the definition of Good Reason) has lapsed if the Company has not reasonably cured the circumstances that gave rise to the basis for the Good Reason termination. |
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| 5.3 | Benefits upon Termination. If the Executive’s employment by the Company is terminated during the Period of Employment for any reason by the Company or by the Executive, or upon or following the expiration of the Period of Employment (the date that the Executive’s employment by the Company terminates is referred to as the “Severance Date”), the Company shall have no further obligation to make or provide to the Executive, and the Executive shall have no further right to receive or obtain from the Company, any payments or benefits except as follows: |
(a) The Company shall pay the Executive (or, in the event of the Executive’s death, the Executive’s estate) any Accrued Obligations. Any Prior-Year Bonus that becomes payable will be paid when the Incentive Bonus for active employees is scheduled to be paid, in accordance with Section 3.2.
(b) If the Executive’s employment with the Company terminates during the Period of Employment as a result of a termination by the Company without Cause (other than due to the Executive’s death or Disability), a resignation by the Executive for Good Reason, or the Company’s notice not to renew this Agreement and to terminate the Period of Employment, the Executive shall be entitled to the following benefits:
(i) The Company shall pay the Executive (in addition to the Accrued Obligations), subject to tax withholding and other authorized deductions, an amount equal to the sum of three (3) times (the “Severance Multiple”): (A) the Executive’s Base Salary at the annualized rate in effect on the Severance Date; and (B) the average Incentive Bonus received by the Executive for the three (3) completed calendar years preceding the Severance Date (or the number of completed calendar years the Executive has been employed by the Company on the Severance Date, if such number is fewer than three (3) years), provided, that if the Executive’s Severance Date occurs prior to the first (1st) anniversary of the Effective Date, such amount shall equal the target Incentive Bonus. Such amount is referred to hereinafter as the “Severance Benefit.” Subject to Section 5.7(b), the Company shall pay the Severance Benefit to the Executive in a lump sum payable on (or within ten (10) days following) the effective date of the Executive’s Release, provided that if the period to review the Release spans two (2) calendar years, the Severance Benefit shall be paid in the second (later) calendar year.
(ii) The Company will either: (A) pay for the Executive’s premiums charged to continue healthcare coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act or similar state law (“COBRA”), at the same or reasonably equivalent medical, dental, and vision coverage for the Executive (and, if applicable, the Executive’s eligible dependents) as in effect immediately prior to the Severance Date, to the extent that the Executive elects such continued coverage; or (B) to the extent COBRA coverage is not available, provide the Executive with a monthly cash payment equal to the cost to continue medical, dental, and vision coverage under COBRA; provided that the Company’s obligation to make any payment pursuant to this clause (ii) shall, subject to Section 5.7(a), commence with continuation coverage for the month following the month in which the Executive’s Separation from Service occurs and shall cease with continuation coverage for the twenty-fourth (24th) month following the month in which the Executive’s Separation from Service occurs (or, if earlier, shall cease upon the date the Executive becomes eligible for coverage under the health plan of a future employer). To the extent the Executive elects COBRA coverage, the Executive shall notify the Company in writing of such election prior to such coverage taking effect and complete any other continuation coverage enrollment procedures the Company may then have in place. In addition, the Company shall reimburse the Executive for the cost of premiums to continue life insurance and long-term disability coverage as in effect immediately prior to the Severance Date for twenty-four (24) months, payable in monthly installments following the Executive’s Separation from Service.
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(iii) With respect to the fiscal year in which the Severance Date occurs, the Company shall pay the Executive the Incentive Bonus that would otherwise have been paid (but not less than the amount payable at the target level set forth in Section 3.2) to the Executive had the Executive’s employment with the Company not terminated with respect to that fiscal year, multiplied by a fraction, the numerator of which is the total number of days in such fiscal year in which the Executive was employed by the Company and the denominator of which is the total number of days in such fiscal year (the “Pro-Rata Bonus”). Any Pro-Rata Bonus that becomes payable will be paid when the Severance Benefit is paid, in accordance with Section 3.2.
(iv) The Executive shall become fully vested in any unvested equity awards subject to time-based vesting that are outstanding on the Severance Date, with any awards subject to performance conditions that are in progress as of the Severance Date to vest on a pro-rated basis (based on number of days employed as a percentage of the applicable performance period) at the greater of: (A) the target performance level; or (B) the level otherwise provided in the applicable award agreement based on actual performance.
(c) If the Executive’s employment with the Company terminates during the Period of Employment due to the Executive’s death or Disability, the Executive shall be entitled to the benefits described in Section 5.3(b) above, except that the Severance Multiple shall be one (1).
(d) If the Executive’s employment with the Company terminates during the Period of Employment as a result of a resignation by the Executive without Good Reason (which shall include the Executive’s notice not to renew this Agreement and to terminate the Period of Employment), the Executive shall be entitled to the benefits described in Section 5.3(b)(ii) above. In addition, subject to the Executive’s compliance with the Restrictive Covenants described in Sections 6.2, 6.3, and 6.4 below, the Executive shall be entitled to the benefits described in Section 5.3(b)(i) above, except that: (A) the Severance Multiple shall be one (1); and (B) such payment will be made in twelve (12) substantially equal monthly installments, with the first installment payable on (or within ten (10) days following) the effective date of the Executive’s Release, provided that if the period to review the Release spans two (2) calendar years, such first installment shall be paid in the second (later) calendar year, and to include any installment that was otherwise delayed following the Executive’s Separation from Service.
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(e) Notwithstanding the foregoing provisions of this Section 5.3, if the Executive breaches the Executive’s obligations under Section 6 of this Agreement at any time, from and after the date of such breach and not in any way in limitation of any right or remedy otherwise available to the Company, the Executive will no longer be entitled to, and the Company will no longer be obligated to pay, any remaining unpaid portion of the Severance Benefit or any Prior-Year Bonus, Pro-Rata Bonus, equity acceleration for any outstanding and unvested equity awards that remain outstanding at the time of the breach, or the benefits described in Section 5.3(b)(ii) or Section 5.3(d); provided that, if the Executive provides the Release required by Section 5.4, in no event shall the Executive be entitled to benefits pursuant to this Section 5.3 of less than $5,000, which amount the parties agree is good and adequate consideration, in and of itself, for the Executive’s Release required by Section 5.4.
(f) The foregoing provisions of this Section 5.3 shall not affect: (i) the Executive’s receipt of benefits otherwise due to terminated employees under group insurance coverage consistent with the terms of the applicable Company welfare benefit plan; (ii) the Executive’s rights under COBRA to continue health coverage; or (iii) the Executive’s receipt of benefits otherwise due in accordance with the terms of the Company’s 401(k) plan (if any).
| 5.4 | Release; Exclusive Remedy; Leave. |
(a) This Section 5.4 shall apply notwithstanding anything else contained in this Agreement or any equity-based award agreement to the contrary. As a condition precedent to any Company obligation to the Executive pursuant to Section 5.3(b) or (d) or any other obligation to accelerate vesting of any equity-based award in connection with the termination of the Executive’s employment, the Executive shall provide the Company with a valid, executed general release agreement in substantially the form attached hereto as Exhibit A (the “Release”), and such Release shall have not been revoked by the Executive pursuant to any revocation rights afforded by applicable law. The Company shall provide the final form of Release to the Executive not later than seven (7) days following the Severance Date, and the Executive shall be required to execute and return the Release to the Company within twenty-one (21) days (or forty-five (45) days if such longer period of time is required to make the Release maximally enforceable under applicable law).
(b) The Executive agrees that the payments and benefits contemplated by Section 5.3 (and any applicable acceleration of vesting of an equity-based award in accordance with the terms of such award in connection with the termination of the Executive’s employment) shall constitute the exclusive and sole remedy for any termination of the Executive’s employment and the Executive covenants not to assert or pursue any other remedies, at law or in equity, with respect to any termination of employment. The Company and the Executive acknowledge and agree that there is no duty of the Executive to mitigate damages under this Agreement. All amounts paid to the Executive pursuant to Section 5.3 shall be paid without regard to whether the Executive has taken or takes actions to mitigate damages. The Executive agrees to resign, on the Severance Date, as an officer and director of the Company and any Affiliate of the Company, and as a fiduciary of any benefit plan of the Company or any Affiliate of the Company, and to promptly execute and provide to the Company any further documentation, as requested by the Company, to confirm such resignation, and to remove himself as a signatory on any accounts maintained by the Company or any of its Affiliates (or any of their respective benefit plans) at the Company’s sole cost and expense.
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(c) In the event that the Executive provides the Company notice of termination pursuant to Section 5.2, the Company will have the option to place the Executive on paid administrative leave during the notice period.
| 5.5 | Certain Defined Terms. |
(a) As used herein, “Accrued Obligations” means:
(i) any Base Salary that had accrued but had not been paid (including accrued and unpaid vacation time) on or before the Severance Date;
(ii) any reimbursement due to the Executive pursuant to Section 4.2 for expenses incurred by the Executive on or before the Severance Date and documented, to the extent applicable, in accordance with the Company’s expense reimbursement policies in effect at the applicable time; and
(iii) any Incentive Bonus that would otherwise be paid to the Executive had the Executive’s employment with the Company not terminated with respect to any fiscal year that ended before the Severance Date, to the extent not theretofore paid (the “Prior-Year Bonus”).
(b) As used herein, “Affiliate” of the Company means a Person that directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Company. As used in this definition, the term “control,” including the correlative terms “controlling,” “controlled by” and “under common control with,” means the possession, directly or indirectly, of the power to direct or cause the direction of management or policies (whether through ownership of securities or any partnership or other ownership interest, by contract or otherwise) of a Person.
(c) As used herein, “Cause” shall mean, as reasonably determined by the Board (excluding the Executive, if the Executive is then a member of the Board) based on the information then known to it, that one or more of the following has occurred:
(i) the conviction of the Executive of, or the entry of a plea of guilty or nolo contendere by the Executive to, a felony (exclusive of a conviction, plea of guilty or nolo contendere arising under a statutory provision imposing criminal liability upon the Executive on a per se basis due to any offices held by the Executive pursuant to the terms of this Agreement, so long as any act or omission of the Executive with respect to such matter was not taken or omitted in contravention of any applicable policy or directive of the Board);
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(ii) the Executive’s willful breach of the Executive’s duty of loyalty which is materially detrimental to the Company or any of its Affiliates and which is not cured to the reasonable satisfaction of the Board within thirty (30) days following written warning to the Executive from the Board describing the alleged circumstances; provided that if there is an inconsistency in directives given by the Board as compared to a directive from the Company’s Chief Executive Officer, the Board directives shall control;
(iii) gross negligence or willful misconduct in the performance of the Executive’s duties (which is not cured by the Executive within thirty (30) days after written warning from the Board);
(iv) the Executive’s willful commission of an act of dishonesty resulting in material economic or financial injury to the Company or any of its Affiliates, or willful commission of fraud; or
(v) the Executive’s chronic absence from work for reasons other than illness, Disability (as defined below), or business-related travel which is not cured to the reasonable satisfaction of the Board within thirty (30) days following written warning to the Executive from the Board describing the alleged circumstances.
For purposes of this Section 5.5(c), no act, or failure to act, on the Executive’s part will be deemed “willful” unless done, or omitted to be done, by the Executive not in good faith and without a reasonable belief that the Executive’s act, or failure to act, was in the best interest of the Company or any of its Affiliates. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board or based upon the advice of outside counsel for the Company or its Affiliates shall be conclusively presumed to have been done, or omitted, by the Executive in good faith and in the best interests of the Company and its Affiliates.
(d) As used herein, “Disability” shall mean a physical or mental impairment which, as reasonably determined by the Board, renders the Executive unable to perform the essential functions of the Executive’s employment with the Company, even with reasonable accommodation that does not impose an undue hardship on the Company, for more than ninety (90) days in any one hundred eighty (180)-day period, unless a longer period is required by federal or state law, in which case that longer period would apply. The Executive agrees to reasonably cooperate with the Board in making any such determination as to the existence of Disability.
| (e) | As used herein, “Good Reason” shall mean the occurrence (without the Executive’s written consent) of any one or more of the following conditions: |
(i) any diminution in the Executive’s Base Salary or Incentive Bonus (including any reduction to the threshold, target, or maximum Incentive Bonus levels (as set forth in Section 3.2));
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(ii) any diminution, not consented to by the Executive in a writing signed by the Executive, in the nature or scope of the Executive’s responsibilities, authorities, powers, functions, title or duties, which shall be determined taking into account that Parent is, as of the Effective Date, a public company and shall specifically include: (A) any requirement to report directly to any individual other than the Board; and (B) any requirement to report, directly or indirectly, to any executive of any Affiliate that is the parent company of, or otherwise controls, Parent;
(iii) a material change in the geographic location of the Executive’s principal office with the Company to a location outside the greater Dallas, Texas metropolitan area; or
(iv) a material breach by the Company of this Agreement or any other material agreement in effect between the Executive and the Company or any of its Affiliates;
provided, however, that any such condition or conditions, as applicable, shall not constitute Good Reason unless both: (x) the Executive provides written notice to the Company of the condition claimed to constitute Good Reason within thirty (30) days of the initial existence of such condition(s) (such notice to be delivered in accordance with Section 18); and (y) the Company fails to remedy such condition(s) within thirty (30) days of receiving such written notice thereof; and provided, further, that in all events the termination of the Executive’s employment with the Company shall not constitute a termination for Good Reason unless such termination occurs not more than one hundred twenty (120) days following the initial existence of the condition claimed to constitute Good Reason.
(f) As used herein, the term “Person” shall be construed broadly and shall include, without limitation, an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.
(g) As used herein, “Restricted Period” means the period beginning on the Effective Date and ending on the first (1st) anniversary of the Executive’s Severance Date.
(h) As used herein, a “Separation from Service” occurs when the Executive dies, retires, or otherwise has a termination of employment with the Company that constitutes a “separation from service” within the meaning of Treasury Regulation Section 1.409A-1(h)(1), without regard to the optional alternative definitions available thereunder.
| 5.6. | Notice of Termination; Employment Following Expiration of Period of Employment. Any termination of the Executive’s employment under this Agreement shall be communicated by written notice of termination from the terminating party to the other party. This notice of termination must be delivered in accordance with Section 18 and must indicate the specific provision(s) of this Agreement relied upon in effecting the termination and the basis of any termination by the Company for Cause or by the Executive for Good Reason. |
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| 5.7 | Section 409A. |
| (a) | It is intended that any amounts payable under this Agreement shall either be exempt from or comply with Section 409A of the Code (including the Treasury regulations and other published guidance relating thereto) (“Code Section 409A”) so as not to subject the Executive to payment of any additional tax, penalty or interest imposed under Code Section 409A. The provisions of this Agreement shall be construed and interpreted to avoid the imputation of any such additional tax, penalty or interest under Code Section 409A yet preserve (to the nearest extent reasonably possible) the intended benefit payable to the Executive. Any installment payments provided for in this Agreement shall be treated as a series of separate payments for purposes of Code Section 409A. The Company makes no representation that any or all of the payments described in this Agreement will be exempt from or comply with Code Section 409A, and the Executive is solely responsible for any additional taxes, penalties or interest imposed under Code Section 409A. |
| (b) | If the Executive is a “specified employee” within the meaning of Treasury Regulation Section 1.409A-1(i) as of the date of the Executive’s Separation from Service, the Executive shall not be entitled to any payment or benefit pursuant to this Agreement until the earlier of: (i) the date which is six (6) months after the Executive’s Separation from Service for any reason other than death; or (ii) the date of the Executive’s death. The provisions of this Section 5.7(b) shall only apply if, and to the extent, required to avoid the imputation of any tax, penalty or interest pursuant to Code Section 409A. Any amounts otherwise payable to the Executive upon or in the six (6) month period following the Executive’s Separation from Service that are not so paid by reason of this Section 5.7(b) shall be paid (without interest) as soon as practicable (and in all events within thirty (30) days) after the date that is six (6) months after the Executive’s Separation from Service (or, if earlier, as soon as practicable, and in all events within thirty (30) days, after the date of the Executive’s death). |
| (c) | To the extent that any benefits or reimbursements pursuant to this Agreement are taxable to the Executive, any reimbursement payment due to the Executive pursuant to any such provision shall be paid to the Executive on or before the last day of the Executive’s taxable year following the taxable year in which the related expense was incurred. The benefits and reimbursements pursuant to such provisions are not subject to liquidation or exchange for another benefit and the amount of such benefits and reimbursements that the Executive receives in one taxable year shall not affect the amount of such benefits or reimbursements that the Executive receives in any other taxable year. |
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| 5.8 | Possible Limitation of Benefits in Connection with a Change in Control. Notwithstanding anything contained in this Agreement to the contrary, if following a change in ownership or effective control or in the ownership of a substantial portion of assets (in each case, within the meaning of Section 280G of the Code), the tax imposed by Section 4999 of the Code or any similar or successor tax (the “Excise Tax”) applies to any payments, benefits and/or amounts received by the Executive pursuant to this Agreement or otherwise, including, without limitation, any acceleration of the vesting of outstanding equity awards (collectively, the “Total Payments”), then the Total Payments shall be reduced (but not below zero) so that the maximum amount of the Total Payments (after reduction) shall be one dollar ($1.00) less than the amount which would cause the Total Payments to be subject to the Excise Tax; provided that such reduction to the Total Payments shall be made only if the total after-tax benefit to the Executive is greater after giving effect to such reduction than if no such reduction had been made. If such a reduction is required, the Company shall reduce or eliminate the Total Payments by first reducing or eliminating any cash payments under this Agreement, then by reducing or eliminating any accelerated vesting of equity awards, then by reducing or eliminating any other remaining Total Payments, in each case in reverse order beginning with the payments which are to be paid the farthest in time from the date of the transaction triggering the Excise Tax. The provisions of this Section 5.8 shall take precedence over the provisions of any other plan, arrangement or agreement governing the Executive’s rights and entitlements to any benefits or compensation. |
| 6. | Protective Covenants. |
| 6.1 | Confidential Information. The Executive recognizes and acknowledges that the Executive has, will have access to, and will receive confidential and proprietary information of the Company and its Affiliates, which, in each case, constitute valuable, special, and unique assets of such entity. The term “Confidential Information” as used in this Agreement shall mean all non-public information of the Company and its Affiliates, as applicable, including, without limitation, information regarding clients, customers, pricing policies, methods of operation, proprietary company programs, sales, acquisitions, products, profits, costs, conditions (financial or other), cash flows, key personnel, formulae, product applications, technical processes, and trade secrets, as such information may exist from time to time, which the Executive acquired or obtained by virtue of work performed for the Company (whether prior to or after the Effective Date), or which the Executive may acquire or may have acquired knowledge of during the performance of said work. |
The Executive acknowledges that the Company has put in place certain policies and practices to keep such Confidential Information secret, including disclosing Confidential Information only on a need-to-know basis. The Executive further acknowledges that the Confidential Information has been developed or acquired by the Company through the expenditure of substantial time, effort, and money and provides the Company with an advantage over competitors who do not know such Confidential Information. Finally, the Executive acknowledges that such Confidential Information, if revealed to or used for the benefit of the Company’s competitors or in a manner contrary to the Company’s interests, would cause extensive and immeasurable harm to the Company and to the Company’s competitive position.
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The Executive shall not, during the Period of Employment or at any time thereafter, use for personal gain, for the benefit of any third party, or detrimentally to the Company all or any part of the Confidential Information, or disclose or make available all or any part of the Confidential Information to any person, firm, corporation, association, or any other entity for any reason or purpose whatsoever, directly or indirectly, except as may be required pursuant to the Executive’s employment hereunder, unless and until such Confidential Information becomes publicly available other than as a consequence of the breach by the Executive of the Executive’s confidentiality obligations hereunder. Notwithstanding the foregoing, Executive shall not be restricted from disclosing or using Confidential Information that: (i) is or becomes generally available to the public other than as a result of an unauthorized disclosure by Executive or the Executive’s agent; (ii) becomes available to the Executive in a manner that is not in contravention of applicable law or in violation of any confidentiality or similar agreement from a source (other than the Company, its Affiliates, or their officers, employees, agents or representatives) that is not known by Executive, after reasonable investigation, to be bound by a confidential relationship with the Company or any Affiliate or by a confidentiality or other similar agreement; or (iii) is required to be disclosed by law, court order or other legal process; provided, however, that in the event disclosure is required by law, court order or legal process, Executive shall provide the Company, if legally permissible, with prompt notice of such requirement as set forth below in this Section 6.1.
The Executive acknowledges that the Confidential Information shall remain at all times the exclusive property of the Company, and no license is granted to the Executive. In the event of the termination of the Executive’s employment, whether voluntary or involuntary and whether by the Company or the Executive, or within seven (7) days of the Company’s request under any other circumstances, the Executive shall deliver to the Company all Confidential Information, in any form whatsoever, including electronic formats, and shall not take with him any Confidential Information or any reproductions (in whole or in part) or extracts of any items relating to the Confidential Information. The Company acknowledges that prior to the Executive’s employment with the Company, the Executive has lawfully acquired extensive knowledge of the industries in which the Company engages in business including, without limitation, markets, valuation methods and techniques, capital markets, investor relationships and similar items, and that the provisions of this Section 6.1 are not intended to restrict the Executive’s use of such previously acquired knowledge.
By this Agreement, the Company is providing the Executive with rights that the Executive did not previously have. In exchange for the foregoing and the additional terms agreed to in this Agreement, the Executive agrees that: (i) the Executive is being provided with access to and has received and will receive Confidential Information to which the Executive has not previously had access; and (ii) all goodwill developed with the Company’s clients, customers and other business contacts by the Executive is the exclusive property of the Company and that the Executive has benefited from such goodwill. The Executive waives and releases any claim that he should be able to use, for the benefit of any competing person or entity, client and customer goodwill or Confidential Information that was previously received or developed by the Executive while working for the Company or any Affiliate.
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| 6.2 | Restriction on Competition. During the Restricted Period, the Executive will not, directly or indirectly, either as a principal, agent, employee, employer, stockholder or partner engage in any “Competitive Business;” provided, however, that the foregoing shall not prohibit or limit the Executive’s right to pursue and maintain passive investments allowed pursuant to this Section 6.2. For purposes of this Section 6.2, “Competitive Business” means a business whose primary business is acquiring, investing in or with respect to, owning or leasing hotel properties in the United States or in any international market in which the Company or its Affiliates conduct such business or originating or acquiring loans in respect of hotel properties in the United States or in any international market in which the Company or its Affiliates conduct such business, in each case, where the Executive had duties or performed services for the Company, which the parties stipulate is a reasonable geographic area because of the scope of the Company’s operations and the Executive’s employment with the Company. The Executive may not avoid the purpose and intent of this restriction by engaging in conduct within the geographically limited area from a remote location through means such as telecommunications, written correspondence, computer generated or assisted communications, or other similar methods. |
| 6.3 | Non-Solicitation of Employees. The Executive covenants and agrees that during the Restricted Period, the Executive shall not, without the prior written consent of the Company, directly or indirectly, whether for the Executive’s own account or on behalf of any person, firm, corporation, partnership, association or other entity or enterprise, solicit, recruit, hire or cause to be hired any employees of the Company or any of its Affiliates, or any person who was an employee of the Company during the six (6) months preceding the Executive’s Severance Date, or solicit or encourage any employee of the Company or any of its Affiliates to leave the employment of the Company or any of such Affiliates, as applicable. The parties hereto agree that: (i) the placement of general advertisements that may be targeted to a particular geographic or technical area but which are not targeted directly or indirectly towards any employees, officers, agents or representatives of the Company (or any successor entity) shall not be deemed a breach of this Section 6.3; and (ii) the employment or engagement of such persons by an entity that is not controlled by the Executive and whom the Executive did not encourage, solicit or induce or in any manner attempt to encourage, solicit or induce to terminate such person’s employment with the Company shall not be deemed a breach of this Section 6.3. |
| 6.4 | Non-Interference with Customers. The Executive understands and agrees that all business opportunities related to the business of the Company and its Affiliates that arise during the Period of Employment constitute valuable assets of the Company and its Affiliates, and may not be converted to the Executive’s own use or converted by Executive for the use of any person, firm, corporation, partnership, association or other entity or enterprise. Accordingly, Executive agrees that, during the Restricted Period, the Executive shall not, directly or indirectly, whether for the Executive’s own account or on behalf of any person, firm, corporation, partnership, association or other entity or enterprise, interfere with, solicit, pursue, or in any manner make use of any such business opportunities. |
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| 6.5 | Non-Disparagement. The Executive agrees that, during the Period of Employment and thereafter (including following the Executive’s termination of employment for any reason) the Executive will not make statements or representations, or otherwise communicate, directly or indirectly, in writing, orally, or otherwise, or take any action which may, directly or indirectly, disparage the Company or its Affiliates or their respective officers, directors, employees, advisors, businesses or reputations. The Company agrees that, during the Period of Employment and thereafter (including following Executive’s termination of employment for any reason), the Company’s directors, officers or other employees will not make statements or representations, or otherwise communicate, directly or indirectly, in writing, orally, or otherwise, or take any action which may directly or indirectly, disparage Executive or the Executive’s family or the Executive’s business or reputation; provided, however, the Company shall have no liability for any communication by its employees (other than its officers) that violates this non-disparagement clause, unless an officer of the Company is made aware of such communication and fails to take appropriate action to enforce this non-disparagement clause on behalf of the Company. Notwithstanding the foregoing, nothing in this Agreement shall preclude either Executive or the Company from making truthful statements or disclosures that are required by applicable law, regulation, or legal process. Notwithstanding the foregoing, nothing in this Agreement prohibits the Executive from reporting possible violations of federal law or regulation to any government agency or entity or making any other disclosure protected under whistleblower provisions of law. The Executive does not need prior authorization to make such reports or disclosures and is not required to notify the Company that the Executive has made any such report of disclosure. |
| 6.6 | Protected Disclosures; Defend Trade Secrets Act. Pursuant to the Defend Trade Secrets Act of 2016, the Executive acknowledges that the Executive may not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of Confidential Information that: (a) is made in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney solely for the purpose of reporting or investigating a suspected violation of law; or (b) is made in a complaint or other document that is filed in a lawsuit or other proceeding, provided that such filing is made under seal. Further, the Company shall not retaliate against the Executive in any way for any such disclosure made in accordance with applicable law. In the event a disclosure is made, and the Executive files any type of proceeding against the Company alleging that the Company retaliated against the Executive because of the Executive’s disclosure, the Executive may disclose the relevant Confidential Information to the Executive’s attorney and may use the Confidential Information in the proceeding if: (x) the Executive files any document containing the Confidential Information under seal; and (y) the Executive does not otherwise disclose the Confidential Information except pursuant to court or arbitral order. |
Nothing in this Section 6 or elsewhere in this Agreement shall prevent the Executive from: (A) responding to a lawful subpoena; (B) reporting to a government agency; (C) participating in an investigation by a government agency; (D) providing truthful testimony under oath; (E) exercising the Executive’s rights under Section 7 of the National Labor Relations Act; (F) disclosing or discussing information about unlawful acts in the workplace, such as harassment, including sexual harassment, discrimination, or any other conduct that Employee has reason to believe is unlawful; (G) disclosing information about sexual assault or sexual abuse; or (H) complying with any other legal obligation.
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| 6.7 | Understanding of Covenants. The Executive acknowledges that, in the course of the Executive’s employment with the Company and/or its Affiliates and their predecessors, the Executive has become familiar, or will become familiar, with the Company’s and its Affiliates’ and their predecessors’ trade secrets and with other confidential and proprietary information concerning the Company, its Affiliates and their respective predecessors and that the Executive’s services have been and will be of special, unique and extraordinary value to the Company and its Affiliates. The Executive agrees that the foregoing covenants set forth in this Section 6 (together, the “Restrictive Covenants”) are reasonable and necessary to protect the Company’s and its Affiliates’ trade secrets and other confidential and proprietary information, good will, stable workforce, and customer relations. |
Without limiting the generality of the Executive’s agreement in the preceding paragraph, the Executive: (i) represents that the Executive is familiar with and has carefully considered the Restrictive Covenants; (ii) represents that the Executive is fully aware of the Executive’s obligations hereunder; (iii) agrees to the reasonableness of the length of time, scope and geographic coverage, as applicable, of the Restrictive Covenants; (iv) agrees that the Company and its Affiliates currently conduct business throughout the United States and may expand its business outside of the United States; and (v) agrees that the Restrictive Covenants will continue in effect for the applicable periods set forth above in this Section 6 regardless of whether the Executive is then entitled to receive severance pay or benefits from the Company. The Executive understands that the Restrictive Covenants may limit the Executive’s ability to earn a livelihood in a business similar to the business of the Company and any of its Affiliates, but the Executive nevertheless believes that the Executive has received and will receive sufficient consideration and other benefits as an employee of the Company and as otherwise provided hereunder or as described in the recitals hereto to clearly justify such restrictions which, in any event (given the Executive’s education, skills and ability), the Executive does not believe would prevent the Executive from otherwise earning a living. The Executive agrees that the Restrictive Covenants do not confer a benefit upon the Company disproportionate to the detriment of the Executive.
| 6.8 | Enforcement. The Executive agrees that the Executive’s services are unique and that the Executive has access to Confidential Information. Accordingly, without limiting the generality of Section 17, the Executive agrees that a breach by the Executive of any of the covenants in this Section 6 would cause immediate and irreparable harm to the Company that would be difficult or impossible to measure, and that damages to the Company for any such injury would therefore be an inadequate remedy for any such breach. Therefore, the Executive agrees that in the event of any breach or threatened breach of any provision of this Section 6, the Company shall be entitled, in addition to and without limitation upon all other remedies the Company may have under this Agreement, at law or otherwise, to obtain specific performance, injunctive relief and/or other appropriate relief (without posting any bond or deposit) in order to enforce or prevent any violations of the provisions of this Section 6. |
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| 7. | Withholding Taxes. Notwithstanding anything else herein to the contrary, the Company may withhold (or cause there to be withheld, as the case may be) from any amounts otherwise due or payable under or pursuant to this Agreement such federal, state and local income, employment, or other taxes as may be required to be withheld pursuant to any applicable law or regulation. Except for such withholding rights, the Executive is solely responsible for any and all tax liability that may arise with respect to the compensation provided under or pursuant to this Agreement. |
| 8. | Successors and Assigns. |
(a) This Agreement is personal to the Executive and without the prior written consent of the Company shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives.
(b) This Agreement shall inure to the benefit of and be binding upon the Company, Parent, and their respective successors and assigns, and each of Company and Parent shall be liable for the payment of benefits hereunder. Without limiting the generality of the preceding sentence, the Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor or assignee, as applicable, which assumes and agrees to perform this Agreement by operation of law or otherwise.
| 9. | Number and Gender; Examples. Where the context requires, the singular shall include the plural, the plural shall include the singular, and any gender shall include all other genders. Where specific language is used to clarify by example a general statement contained herein, such specific language shall not be deemed to modify, limit or restrict in any manner the construction of the general statement to which it relates. |
| 10. | Section Headings. The section headings of, and titles of paragraphs and subparagraphs contained in, this Agreement are for the purpose of convenience only, and they neither form a part of this Agreement nor are they to be used in the construction or interpretation thereof. |
| 11. | Governing Law. This Agreement will be governed by and construed in accordance with the laws of the state of Texas, without giving effect to any choice of law or conflicting provision or rule (whether of the state of Texas or any other jurisdiction) that would cause the laws of any jurisdiction other than the state of Texas to be applied. In furtherance of the foregoing, the internal law of the state of Texas will control the interpretation and construction of this Agreement, even if under such jurisdiction’s choice of law or conflict of law analysis, the substantive law of some other jurisdiction would ordinarily apply. |
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| 12. | Severability. It is the desire and intent of the parties hereto that the provisions of this Agreement be enforced to the fullest extent permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if any particular provision of this Agreement shall be adjudicated by a court of competent jurisdiction or determined by an arbitrator pursuant to Section 16 to be invalid, prohibited or unenforceable under any present or future law, and if the rights and obligations of any party under this Agreement will not be materially and adversely affected thereby, such provision, as to such jurisdiction, shall be ineffective, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction, and to this end the provisions of this Agreement are declared to be severable; furthermore, in lieu of such invalid or unenforceable provision there will be added automatically as a part of this Agreement, a legal, valid and enforceable provision as similar in terms to such invalid or unenforceable provision as may be possible. Notwithstanding the foregoing, if such provision could be more narrowly drawn (as to geographic scope, period of duration or otherwise) so as not to be invalid, prohibited or unenforceable in such jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction. |
| 13. | Entire Agreement. This Agreement embodies the entire agreement of the parties hereto respecting the matters within its scope. This Agreement supersedes all prior and contemporaneous agreements of the parties hereto that directly or indirectly bears upon the subject matter hereof (including, without limitation, any prior employment or similar agreements). Any prior negotiations, correspondence, agreements, proposals or understandings relating to the subject matter hereof shall be deemed to have been merged into this Agreement, and to the extent inconsistent herewith, such negotiations, correspondence, agreements, proposals, or understandings shall be deemed to be of no force or effect. There are no representations, warranties, or agreements, whether express or implied, or oral or written, with respect to the subject matter hereof, except as expressly set forth herein. |
| 14. | Modifications. This Agreement may not be amended, modified or changed (in whole or in part), except by a formal, definitive written agreement expressly referring to this Agreement, which agreement is executed by both of the parties hereto. |
| 15. | Waiver. Neither the failure nor any delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or of any right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver. |
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| 16. | Arbitration. Except as provided in Sections 6.8 and 17, in the event that there is any claim or dispute arising out of or relating to this Agreement, or the breach (or alleged breach) thereof, and the parties hereto shall not have resolved such claim or dispute within sixty (60) days after written notice from one party to the other setting forth the nature of such claim or dispute, then such claim or dispute shall be settled exclusively by binding arbitration in Dallas, Texas in accordance with the Employment Arbitration Rules of the American Arbitration Association (the “AAA Rules”) by an arbitrator mutually agreed upon by the parties hereto or, in the absence of such agreement, by an arbitrator selected according to such AAA Rules. Notwithstanding the foregoing, if either the Company or the Executive shall request, such arbitration shall be conducted by a panel of three arbitrators, one selected by the Company, one selected by the Executive and the third selected by agreement of the first two, or, in the absence of such agreement, in accordance with the AAA Rules. Neither party shall have the right to claim or recover punitive damages. Judgment upon the award rendered by such arbitrator(s) shall be entered in any court having jurisdiction thereof upon the application of either party. Except as provided in Sections 6.8 and 17, the parties acknowledge and agree that they are hereby waiving any rights to trial by jury or a court in any action or proceeding brought by either of the parties against the other in connection with any matter whatsoever arising out of or in any way connected with this Agreement or the Executive’s employment. |
| 17. | Remedies. Each of the parties to this Agreement and any Person granted rights hereunder whether or not such person or entity is a signatory hereto shall be entitled to enforce its rights under this Agreement specifically to recover damages and costs for any breach of any provision of this Agreement and to exercise all other rights existing in its favor. The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and that each party (as well as each other Person granted rights hereunder) may in its sole discretion obtain permanent injunctive or equitable relief in any arbitration filed pursuant to Section 16 and enforce any such relief awarded by the arbitrator in any court of competent jurisdiction. In addition, each party may also apply to any court of law or equity of competent jurisdiction for provisional injunctive or equitable relief, including a temporary restraining or preliminary injunction (without any requirement to post any bond or deposit), to ensure that the relief sought in arbitration is not rendered ineffectual by interim harm. Each party shall be responsible for paying its own attorneys’ fees, costs and other expenses pertaining to any such legal proceeding and enforcement regardless of whether an award or finding or any judgment or verdict thereon is entered against either party. |
| 18. | Notices. Any notice provided for in this Agreement must be in writing and must be either personally delivered, transmitted via email, mailed by first class mail (postage prepaid and return receipt requested) or sent by reputable overnight courier service (charges prepaid) to the recipient at the address below indicated or at such other address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party. Notices will be deemed to have been given hereunder and received when delivered personally, when received if sent via email, five (5) days after deposit in the U.S. mail and one (1) day after deposit with a reputable overnight courier service. |
if to the Company:
| BHR Luxury Hotels Management, LLC 14001 Dallas Parkway, Suite 1100 Dallas, TX 75240 Attention: Chief Legal Officer |
if to the Executive, to the address most recently on file in the payroll records of the Company.
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| 19. | Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original as against any party whose signature appears thereon, and all of which together shall constitute one and the same instrument. This Agreement shall become binding when one or more counterparts hereof, individually or taken together, shall bear the signatures of all of the parties reflected hereon as the signatories. Photographic copies of such signed counterparts may be used in lieu of the originals for any purpose. |
| 20. | Legal Counsel; Mutual Drafting. Each party recognizes that this is a legally binding contract and acknowledges and agrees that they have had the opportunity to consult with legal counsel of their choice. Each party has cooperated in the drafting, negotiation and preparation of this Agreement. Hence, in any construction to be made of this Agreement, the same shall not be construed against either party on the basis of that party being the drafter of such language. The Executive agrees and acknowledges that the Executive has read and understands this Agreement, is entering into it freely and voluntarily, and has been advised to seek counsel prior to entering into this Agreement and has had ample opportunity to do so. |
| 21. | Indemnification and D&O Insurance Coverage. The Company will indemnify the Executive, to the maximum extent permitted by applicable law, against all costs, charges and expenses incurred or sustained by the Executive, including the cost of legal counsel selected and retained by the Executive in connection with any action, suit or proceeding to which the Executive may be made a party by reason of the Executive being or having been an officer, director, or employee of the Company or any Affiliate. The Company’s obligations under this Section 21 shall be in addition to any other indemnification rights to which the Executive may be entitled; provided, however, that in no event shall the Executive’s indemnification rights and the rights to advancement of fees and expenses at any time be less favorable than the indemnification rights and rights to advancement of fees and expenses generally available to officers or directors of the Company or its Affiliates. During and for a period equal to the relevant statute of limitations following the Period of Employment, the Executive shall be entitled to director and officer insurance coverage for his acts and omissions while an officer of the Company (or any of its Affiliates, as applicable) on a basis no less favorable to the Executive than the coverage provided other similarly situated executives or directors of the Company or its Affiliates. |
| 22. | Full Settlement. The Company’s obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action which the Company may have against the Executive or others. The Company agrees to pay as incurred (within thirty (30) days following the Company’s receipt of an invoice from the Executive), to the full extent permitted by law, all reasonable legal fees and expenses which the Executive or his beneficiaries may reasonably incur as a result of any contest (regardless of the outcome thereof) by the Company, the Executive or others of the validity or enforceability of, or liability under, any provision of this Agreement or any guarantee of performance thereof (including as a result of any contest by the Executive or his beneficiaries about the amount of any payment pursuant to this Agreement), plus in each case interest on any delayed payment at the applicable Federal rate provided for in Section 7872(f)(2)(a) of the Code to the extent permitted by Code Section 409A. The preceding sentence shall not apply with respect to any such contest if the court having jurisdiction over such contest makes a final determination that the Executive’s claim in such contest is frivolous or maintained in bad faith. This reimbursement obligation shall remain in effect following the Executive’s termination of employment for the applicable statute of limitations period relating to any such claim. |
| 23. | Clawback Policy. All compensation payable under this Agreement is subject to the terms of the Company’s recoupment, clawback or similar policy as it may be in effect from time to time, as well as any similar provisions of applicable law. |
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IN WITNESS WHEREOF, the Company and the Executive have executed this Agreement as of the date hereof.
| “COMPANY” | |||
| BHR LUXURY HOTELS MANAGEMENT, LLC, | |||
| a Texas limited liability company | |||
| By: | Braemar Hospitality Limited Partnership, a Delaware limited partnership | ||
| Sole Member | |||
| By: | Braemar OP General Partner LLC, | ||
| a Delaware limited liability company | |||
| General Partner | |||
| By: | /s/ Robert G. Haiman | ||
| Robert G. Haiman | |||
| Chief Legal Officer & Secretary | |||
| “PARENT” | ||
| BRAEMAR HOTELS & RESORTS INC. | ||
| a Maryland corporation | ||
| By: | /s/ Robert G. Haiman | |
| Robert G. Haiman | ||
| Chief Legal Officer & Secretary | ||
| “EXECUTIVE” | |
| /s/ Richard J. Stockton | |
| Richard J. Stockton |
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EXHIBIT A
RELEASE AND WAIVER
THIS RELEASE AND WAIVER (this “Termination Release”) is made and entered into as of the [___] day of [____], 20[_] by and among Richard J. Stockton (the “Executive”), BHR Luxury Hotels Management, LLC, a Texas limited liability company (the “Company”), and Braemar Hotels & Resorts Inc., a Maryland corporation (the “Parent”).
WHEREAS, the Company, the Parent and the Executive entered into an Employment Agreement (the “Agreement”), effective as of November 10, 2026, which provides for payment of the Severance Benefits (as defined below) upon the Executive’s termination of employment in certain circumstances;
WHEREAS, the Executive has agreed, pursuant to the terms of the Agreement, to execute and, if applicable, not revoke, a release and waiver in the form set forth in this Termination Release in consideration of the Company’s agreement to provide the Severance Benefits;
WHEREAS, capitalized terms not defined herein shall have the meanings set forth in the Agreement; and
WHEREAS, the Company, the Parent and the Executive desire to settle all rights, duties and obligations between them, including without limitation all such rights, duties, and obligations arising under the Agreement or otherwise out of the Executive’s employment by the Company.
NOW THEREFORE, intending to be legally bound and for good and valid consideration the sufficiency of which is hereby acknowledged, the Executive agrees as follows:
| 1. | QUALIFYING TERMINATION PAYMENTS AND CONDITIONS. The Executive and the Company acknowledge and agree that the Severance Date is [_____], 20[_], and that Executive’s employment with the Company and any Affiliates is terminated as of the Severance Date. The Executive, the Company and the Parent agree that Executive is entitled to the compensation [and benefits] set forth in Section [_]1 of the Agreement (the “Severance Benefits”). Pursuant to Section 5.4 of Agreement, payment of the Severance Benefits is subject to the Executive’s execution and, if applicable, non-revocation of this Termination Release and is due pursuant to the terms described in the Agreement. If a revocation period is required by applicable law, no payment pursuant to Section 5.3 of the Agreement will be due sooner than eight (8) days following the date that Executive executes this Termination Release. |
1 Note to Draft: To be finalized dependent on qualifying termination reason.
A-1
| 2. | GENERAL RELEASE BY EXECUTIVE. |
| a. | Except as set forth in Section 2(b) below, the Executive knowingly and voluntarily releases, acquits, covenants not to sue and forever discharges the Company, its Affiliates, and any of their respective past and present owners, parents, stockholders, predecessors, successors, assigns, agents, directors, officers, employees, representatives, divisions and subsidiaries (collectively, the “Releasees”) from any and all charges, complaints, claims, liabilities, obligations, promises, agreements, damages, causes of action, suits, rights, costs, losses, debts and expenses of any nature whatsoever, known or unknown, suspected or unsuspected, foreseen or unforeseen, matured or unmatured (collectively, the “Claims”), against them which the Executive or any of his heirs, executors, administrators, successors and assigns ever had, now has or at any time hereafter may have, own or hold by reason of any matter, fact, or cause whatsoever from the beginning of time up to and including the date of this Termination Release, including without limitation all claims for breach of implied or express contract, wrongful discharge, discrimination, retaliation, all tort claims, including unjust enrichment, quantum meruit, negligence, defamation, fraud, all claims for damages, interests, court costs, fees and expenses, all claims for punitive or exemplary damages, and all claims for attorneys’ fees, whether now known or unknown. This release of claims expressly includes all claims arising under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act of 1967, as amended, the Americans with Disabilities Act of 1990, the Family and Medical Leave Act of 1993, the Employee Retirement Income Security Act of 1974, Chapters 21 and 451 of the Texas Labor Code, each as amended, and any other federal, state or local laws, rules, regulations, judicial decisions or public policies now or hereafter recognized. Expressly excluded from this Termination Release are Claims which cannot be waived by law. |
| b. | The Executive represents that he has not filed or permitted to be filed against any of the Releasees, any complaints, charges or lawsuits and covenants and agrees that he will not seek or be entitled to any personal recovery in any court or before any governmental agency, arbitrator or self-regulatory body against any of the Releasees arising out of any matters set forth in Section 2(a) hereof. Nothing herein shall prevent the Executive from seeking to enforce his rights under the Agreement, including without limitation, the Executive’s right to receive his Accrued Obligations, Severance Payment, Pro-Rata Bonus and Other Benefits, in each case, at the time specified in the Agreement. The Executive does not hereby waive or release his rights to any benefits under the Company’s employee benefit plans to which he is or will be entitled pursuant to the terms of such plans in the ordinary course. In addition, nothing herein releases or otherwise waives any rights to the Executive’s: (i) final paycheck; (ii) reimbursement of any outstanding business expense amounts (in accordance with the Agreement and the Company’s business expense reimbursement policies); and (iii) applicable Consolidated Omnibus Budget Reconciliation Act or similar state law benefits under the Company’s standard benefit programs, if any. |
| c. | The Executive recognizes and understands that this Termination Release does not prohibit the Executive from filing an administrative charge with any state or federal agency, including the Equal Employment Opportunity Commission (“EEOC”). The Executive further recognizes and understands that even if the Executive files a charge with an administrative agency, or one is filed on the Executive’s behalf, the Executive waives any right to any relief of any kind should the administrative agency pursue a claim on Employee’s behalf. Notwithstanding any other provision of this Termination Release, the Executive further understands and agrees that: (a) the Executive is not in any way prohibited from reporting information to, or participating in any investigation or proceeding conducted by, the EEOC, the Securities and Exchange Commission (“SEC”) or any other federal, state, or local governmental agency or entity; (b) the Executive is not in any way precluded from providing truthful testimony in response to a valid subpoena, court order, or regulatory request; and (c) nothing in this Termination Release limits the Executive’s right to receive an award for information provided to the SEC. |
A-2
| 3. | ADEA RELEASE BY EXECUTIVE. The Executive hereby completely and forever releases and irrevocably discharges the Releasees, from any and all Claims arising under the Age Discrimination in Employment Act, as amended (“ADEA”) on or before the date the Executive signs this Termination Release (the “ADEA Release”), and hereby acknowledges and agrees that: (i) this Termination Release, including the ADEA Release, was negotiated at arm’s length and the Executive has had the opportunity to confer with counsel of his choosing regarding this Termination Release; (ii) this Termination Release, including the ADEA Release, is worded in a manner that the Executive fully understands; (iii) the Executive specifically waives any rights or claims under the ADEA; (iv) the Executive knowingly and voluntarily agrees to all of the terms set forth in this Termination Release, including the ADEA Release; (v) the Executive acknowledges and understands that any claims under the ADEA that may arise after the date of this Termination Release are not waived; and (vi) the rights and claims waived in this Termination Release, including the ADEA Release, are in exchange for consideration over and above anything to which the Executive was already entitled. |
| 4. | GENERAL RELEASE BY COMPANY. The Company and its Affiliates each do hereby fully, finally and completely release Executive from any and all Claims of any kind or nature arising out of the Executive’s employment with the Company arising from, relating to, or in any way connected with any facts or events occurring on or before the date of this Termination Release; provided, however, that the Executive is not released or discharged from: (i) any Claim arising out of the Executive’s fraudulent, willful, or grossly negligent act or omission; or (ii) his continuing obligations contained in this Termination Release, the Agreement, or in any other agreement with the Company. |
| 5. | REAFFIRMATION OF CONTINUING OBLIGATIONS. Nothing in this Termination Release shall be deemed to affect or relieve the Executive from any continuing obligation contained in any other agreement with the Company or the Company’s rights with respect thereto. The Executive specifically acknowledges and reaffirms the post-termination obligations set forth in Section 6 of the Agreement, including continuing confidentiality, non-disclosure, non-disparagement, non-competition and non-solicitation obligations to the Company under the Agreement (collectively, the “Continuing Obligations”). The Executive further acknowledges that this reaffirmation is material to this Termination Release, and the Executive acknowledges and agrees that the Continuing Obligations are reasonable and enforceable and that he will not challenge or violate these covenants. |
| 6. | ARBITRATION. The Executive understands and agrees that the arbitration requirements set forth in Section 16 of the Agreement remain in full force and effect following the Severance Date and the execution of this Termination Release. Any claims arising out of or under this Termination Release or related to this Termination Release are subject to arbitration pursuant to Section 16 of the Agreement. |
| 7. | MODIFICATION; WAIVER. No modification or addition hereto or waiver or cancellation of any provision hereof shall be valid except by a writing signed by the party to be charged therewith. No delay on the part of any party to this Termination Release in exercising any right or privilege provided hereunder or by law shall impair, prejudice or constitute a waiver of such right or privilege. |
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| 8. | SEVERABILITY. If any provision contained in this Termination Release is determined to be void, illegal or unenforceable, in whole or in part, then the other provisions contained herein shall remain in full force and effect as if the provision which was determined to be void, illegal or unenforceable had not been contained herein. |
| 9. | COSTS. The parties hereto agree that each party shall pay its respective costs, including attorney’s fees, if any, associated with the negotiation, execution and delivery of this Termination Release. |
| 10. | FULLY UNDERSTOOD; PAYMENTS RECEIVED. By signing this Termination Release, the Executive acknowledges and affirms that he has read and understands the foregoing Termination Release, agrees to the terms of this Termination Release, and acknowledges receipt of a copy of this Termination Release. The Executive also hereby acknowledges and affirms the sufficiency of the compensation and severance amounts set forth in the Agreement. The Executive further acknowledges that upon receipt of the compensation and severance amounts set forth in the Agreement, he shall not be entitled to any further payment, compensation or remuneration of any kind from the Company, with respect to the Executive’s employment with the Company. |
| 11. | ENTIRE AGREEMENT. This Termination Release contains the entire agreement between the Executive, the Company and the Parent and supersedes any and all prior understandings or agreements with respect to the subject matter hereof, whether written or oral, except as set forth herein and with respect to any of the Executive’s continuing obligations contained in the Agreement, which shall continue and remain in full force and effect per the terms of those covenants. |
| 12. | ACKNOWLEDGMENT. The Company has advised the Executive to consult with an attorney of his choosing prior to signing this Termination Release and the Executive hereby represents to the Company that he has been offered an opportunity to consult with an attorney prior to signing this Termination Release. The Company has also advised the Executive that Executive has up to [twenty-one (21) days] [forty-five (45) days] to consider and sign the Termination Release and up to seven (7) days after signing in which to revoke acceptance by giving notice to [__________] at [__________________] by personal delivery or by mail postmarked no later than the seventh (7th) day after the Executive signs the Termination Release. The Executive acknowledges and agrees that any changes in the terms of this Termination Release, whether material or immaterial, after the date upon which the Executive first received this Termination Release shall not affect or restart the above-referenced [twenty-one (21)-day] [forty-five (45)-day] consideration period. |
[Signature Page Follows]
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IN WITNESS WHEREOF, and intending to be legally bound hereby, the parties hereto have executed this Termination Release under seal as of the day and year first above written.
| “COMPANY” | |||
| BHR LUXURY HOTELS MANAGEMENT, LLC, | |||
| a Texas limited liability company | |||
| By: | Braemar Hospitality Limited Partnership, a Delaware limited partnership | ||
| Sole Member | |||
| By: | Braemar OP General Partner LLC, | ||
| a Delaware limited liability company | |||
| General Partner | |||
| By: | |||
| Name: | |||
| Title: | |||
| “PARENT” | ||
| BRAEMAR HOTELS & RESORTS INC. | ||
| a Maryland corporation | ||
| By: | ||
| Name: | ||
| Title: | ||
| “EXECUTIVE” | |
| Richard J. Stockton |
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Exhibit 10.3
RELEASE AND WAIVER
THIS RELEASE AND WAIVER (this “Termination Release”) is made and entered into by and among Richard J. Stockton (the “Executive”), Ashford Hospitality Advisors, LLC (the “Company”) and Ashford Inc. (“AINC”).
WHEREAS, the Company, AINC and the Executive entered into that certain Employment Agreement, dated November 14, 2016 (the “Original Agreement”), providing certain compensation and severance amounts upon the Executive’s termination of employment;
WHEREAS, the Company, AINC and the Executive entered into that certain Amended and Restated Employment Agreement, dated April 1, 2019 (the “2019 Agreement”);
WHEREAS, the Company, AINC, Braemar Hotels & Resorts Inc. (“Braemar”), Ashford Hospitality Trust, Inc., the Executive and Jordan Jennings entered into that certain Agreement Concerning Personal Relationship, dated February 15, 2022 (the “Personal Relationship Agreement”);
WHEREAS, the Company and the Executive entered into that certain First Amendment to Amended and Restated Employment Agreement, dated April 1, 2022 (the “2022 Agreement,” and together with the Original Agreement and the 2019 Agreement, the “Agreement”);
WHEREAS, the Executive has agreed, pursuant to the terms of the Agreement, to execute a release and waiver in the form set forth in this Termination Release in consideration of the Company’s agreement to provide the compensation and severance amounts upon the Executive’s termination of employment set out in the Agreement, and the termination by the Company and AINC of certain restrictive covenants contained in the Agreement;
WHEREAS, the Company, AINC and the Executive desire to settle all rights, duties and obligations among them, including without limitation all such rights, duties, and obligations arising under the Agreement or otherwise out of the Executive’s employment by the Company; and
WHEREAS, all capitalized terms used but not defined herein shall have the meanings given them in the Agreement.
NOW THEREFORE, intending to be legally bound and for good and valid consideration the sufficiency of which is hereby acknowledged, the parties agree as follows:
1. QUALIFYING TERMINATION PAYMENTS AND CONDITIONS. The Executive and the Company acknowledge and agree that the Date of Termination (as defined in the Agreement) is or will be November 10, 2026. Payment of the compensation and severance amounts contained in the Agreement is subject to Executive’s execution and non-revocation of this Termination Release and is due pursuant to the terms described in the Agreement. Consistent with the revocation period described below, no such payment will be due sooner than eight (8) days following the date that Executive executes the Termination Release.
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2. GENERAL RELEASE BY EXECUTIVE.
(a) Except as set forth in Section 2(b) below, the Executive knowingly and voluntarily releases, acquits, covenants not to sue and forever discharges the Company, AINC and all the other Ashford-Related Entities, and its and their respective owners, parents, stockholders, predecessors, successors, assigns, agents, directors, officers, employees, representatives, divisions and subsidiaries (collectively, the “Releasees”) from any and all charges, complaints, claims, liabilities, obligations, promises, agreements, damages, causes of action, suits, rights, costs, losses, debts and expenses of any nature whatsoever, known or unknown, suspected or unsuspected, foreseen or unforeseen, matured or unmatured (collectively, the “Claims”), against them which the Executive or any of his heirs, executors, administrators, successors and assigns ever had, now has or at any time hereafter may have, own or hold by reason of any matter, fact, or cause whatsoever from the beginning of time up to and including the date of this Termination Release, including without limitation all claims arising under Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act of 1990, the Family and Medical Leave Act of 1993, the Employee Retirement Income Security Act of 1974, Texas Labor Code Section 21.001, et seq. (Texas Employment Discrimination); Texas Labor Code Section 61.001, et seq. (Texas Pay Day Act); Texas Labor Code Section 62.002, et seq. (Texas Minimum Wage Act); Texas Labor Code Section 201.001, et seq. (Texas Unemployment Compensation Act); Texas Labor Code Section 401.001, et seq., specifically Section 451.001 formerly codified as Article 8307c of the Revised Civil Statutes (Texas Workers’ Compensation Act and Discrimination Issues); and Texas Genetic Information and Testing Law, each as amended, or any other federal, state or local laws, rules, regulations, judicial decisions or public policies now or hereafter recognized. Expressly excluded from this Termination Release are Claims which cannot be waived by law, including any right to receive an award or “bounty” for information provided to any governmental agency (such as the Securities and Exchange Commission) in connection with protected whistleblowing activity.
(b) The Executive represents that he has not filed or permitted to be filed against any of the Releasees, any complaints, charges or lawsuits with any court or governmental agency, arbitrator or self-regulatory body and covenants and agrees that he will not seek or be entitled to any personal recovery directly from any of the Releasees in any court or before any governmental agency, arbitrator or self-regulatory body arising out of any matters set forth in Section 2(a) hereof. The foregoing does not prevent the Executive from accepting an award or “bounty” from any governmental agency in connection with protected whistleblowing activity. Nothing herein shall prevent the Executive from seeking to enforce his rights under this Termination Release or the Agreement, including without limitation, the Executive’s right to receive his Accrued Obligations, Severance Payment, Pro-Rated Bonus and Other Benefits as set forth in Section 7(a) and Section 7(b) of the Agreement, and his rights under Section 12 of the Agreement. The parties have agreed that the Severance Payment is $5,524,000, which will be paid to the Executive within 30 days after the Date of Termination, and the Pro-Rated Bonus is $982,000, which will be paid to the Executive at the same time 2026 incentive bonuses are paid to the Company’s other senior executives. The Executive does not hereby waive or release (i) his rights to any benefits under the Company’s employee benefit plans to which he is or will be entitled pursuant to the terms of such plans in the ordinary course; (ii) any rights to indemnification, advancement of expenses or coverage under any directors’ and officers’ liability insurance policy that the Executive has under the Agreement (including Sections 5(e) and 14 thereof), any indemnification agreement, the governing documents of any of the Releasees, or applicable law with respect to his service as an officer, director or employee of the Company or any of the Ashford-Related Entities; or (iii) any rights under any employment, compensation, indemnification or other agreement or arrangement between the Executive and Braemar or any of its subsidiaries entered into on or after the Date of Termination.
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3. ADEA RELEASE BY EXECUTIVE. The Executive hereby completely and forever releases and irrevocably discharges the Releasees, from any and all Claims arising under the Age Discrimination in Employment Act (“ADEA”) on or before the date the Executive signs this Termination Release (the “ADEA Release”), and hereby acknowledges and agrees that: (i) this Termination Release, including the ADEA Release, was negotiated at arm’s length; (ii) this Termination Release, including the ADEA Release, is worded in a manner that the Executive fully understands; (iii) the Executive specifically waives any rights or claims under the ADEA; (iv) the Executive knowingly and voluntarily agrees to all of the terms set forth in this Termination Release, including the ADEA Release; (v) the Executive acknowledges and understands that any claims under the ADEA that may arise after the date of this Termination Release are not waived; and (vi) the rights and claims waived in this Termination Release, including the ADEA Release, are in exchange for consideration over and above anything to which the Executive was already entitled.
4. GENERAL RELEASE BY COMPANY. The Company and AINC, on behalf of themselves and their affiliates, each do hereby fully, finally and completely release Executive from any and all Claims of any kind or nature arising out of the Executive’s employment with the Company arising from, relating to, or in any way connected with any facts or events occurring on or before the date of this Termination Release; provided, however, that the Executive is not released or discharged from his continuing obligations contained in this Termination Release or the Agreement.
5. NON-DISPARAGEMENT. The Executive covenants and agrees he will not make statements or representations, or otherwise communicate, directly or indirectly, in writing, orally, or otherwise, or take any action which may, directly or indirectly, disparage the Company or its affiliates or their respective officers, directors, employees, advisors, businesses or reputations. Notwithstanding the foregoing, nothing herein or in the Agreement shall preclude the Executive from making truthful statements or disclosures that are required by applicable law, regulation or legal process. The Company covenants and agrees that its directors, officers and other employees will not make statements or representations, or otherwise communicate, directly or indirectly, in writing, orally, or otherwise, or take any action which may, directly or indirectly, disparage the Executive or his family or his business or reputation; provided, however, the Company shall have no liability for any communication by its employees (other than its officers) that violates this non-disparagement clause, unless an officer of the Company is made aware of such communication and fails to take appropriate action to enforce this non-disparagement clause on behalf of the Company. Notwithstanding the foregoing, nothing herein or in the Agreement shall preclude the Executive or the Company or any of its affiliates or its or their officers and directors from (i) contacting, reporting to, communicating with, responding truthfully to an inquiry from, providing truthful information to, filing a charge or complaint with, cooperating with, making truthful statements under oath in connection with, or otherwise testifying or participating in any investigation, hearing, or other proceeding conducted by or before any federal or state law enforcement, governmental, or regulatory agency or body (such as the U.S. Department of Justice, the Securities and Exchange Commission, the Occupational Safety and Health Administration, the Equal Employment Opportunity Commission, the U.S. Department of Labor, or another federal or state law enforcement, governmental, regulatory, or fair employment practices agency) regarding possible or alleged violations of law or unlawful acts in the workplace, or pursuant to applicable whistleblower statutes, and doing so in each instance without prior notice to or authorization from another party or (ii) making truthful statements or disclosures that are required by applicable law, regulation, or legal process.
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6. REAFFIRMATION OF CONTINUING OBLIGATIONS AS MODIFIED; TERMINATION OF CERTAIN AGREEMENT. The Company agrees that (i) the Executive’s continued service to or employment by Braemar in any capacity after the Date of Termination shall not be a violation of his obligations under Section 10(a) of the Agreement or any other similar agreement between the Company or an affiliate and the Executive that restricts the Executive’s service or employment after the Termination Date; (ii) his obligations under Section 10(b)(i) of the Agreement (as amended in Section 2 of the 2022 Agreement) shall not extend to employees or individual service providers of Braemar (or those persons who were employed or engaged by Braemar within the six months preceding the Date of Termination); and (iii) his obligations under Section 10(b)(ii) of the Agreement (as amended in Section 2 of the 2022 Agreement) shall not extend to Braemar’s business relationships with its current investors, financiers, or other capital providers. Except as modified in the preceding sentence, nothing in this Termination Release shall be deemed to affect or relieve the Executive from any continuing obligation contained in any other agreement with the Company or the Company’s rights with respect thereto. The Executive specifically acknowledges and reaffirms his continuing obligations to the Company under the Agreement (including, for the avoidance of doubt, the modifications to such restrictive covenants, terms and conditions set forth in Sections 2 and 3 of the 2022 Agreement) not modified in the first sentence of this paragraph. The Executive further acknowledges that this reaffirmation is material to this Termination Release, and the Executive acknowledges and agrees that his continuing non-competition and non-solicitation obligations under the Agreement as so modified are reasonable and enforceable and that he will not challenge or violate these covenants. The parties acknowledge and agree that the terms, conditions and restrictions of the Personal Relationship Agreement are terminated as of the Date of Termination.
7. MODIFICATION; WAIVER. No modification or addition hereto or waiver or cancellation of any provision hereof shall be valid except by a writing signed by the party to be charged therewith. No delay on the part of any party to this Termination Release in exercising any right or privilege provided hereunder or by law shall impair, prejudice or constitute a waiver of such right or privilege.
8. SEVERABILITY. If any provision contained in this Termination Release is determined to be void, illegal or unenforceable, in whole or in part, then the other provisions contained herein shall remain in full force and effect as if the provision which was determined to be void, illegal or unenforceable had not been contained herein.
9. COSTS. The parties hereto agree that each party shall pay its respective costs, including attorney’s fees, if any, associated with this Termination Release.
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10. FULLY UNDERSTOOD; PAYMENTS RECEIVED. By signing this Termination Release, the Executive acknowledges and affirms that he has read and understands the foregoing Termination Release, agrees to the terms of this Termination Release, and acknowledges receipt of a copy of this Termination Release. The Executive also hereby acknowledges and affirms the sufficiency of the compensation and severance amounts recited herein. The Executive further acknowledges that upon receipt of the compensation and severance amounts recited herein, he shall not be entitled to any further payment, compensation or remuneration of any kind from the Company, with respect to the Executive’s employment with the Company or otherwise.
11. NO VIOLATIONS. As a material inducement for the Company to enter into this Termination Release, the Executive represents that: (i) he has not committed any act which is in violation of any federal or state law or regulation or the Company’s or any of the other Ashford-Related Entities’ personnel or conduct and ethics policies or which constitutes a breach of fiduciary duty; (ii) he has no knowledge that any of the Ashford-Related Entities (or their officers, directors or employees) have committed, any act which is in violation of any federal or state law or regulation or the Company’s or any of the other Ashford-Related Entities’ personnel or conduct and ethics policies, which constitutes a breach of fiduciary duty, or have acted in a manner which requires corrective action of any kind that has not already been taken; and (iii) he has not informed any of the Ashford-Related Entities of, and he is unaware of, any violations of any federal or state law or regulation or the Company’s or any of the other Ashford-Related Entities’ personnel or conduct and ethics policies or breach of fiduciary duty.
12. [Intentionally Deleted].
13. ENTIRE AGREEMENT. This Termination Release contains the entire agreement between the Executive, on one hand, and the Company and AINC, on the other hand, and supersedes any and all prior understandings or agreements with respect to the subject matter hereof, whether written or oral, except as set forth herein.
ACKNOWLEDGMENT. The Company hereby advises the Executive to consult with an attorney of his choosing prior to signing this Termination Release and the Executive hereby represents to the Company that he has been offered an opportunity to consult with an attorney prior to signing this Termination Release. The Company also hereby advises the Executive that Executive has up to twenty-one (21) days to consider and sign the Termination Release and up to seven (7) days after signing in which to revoke acceptance by giving notice to Ashford Hospitality Advisors, LLC, Attn: Jim Plohg – General Counsel, 14185 Dallas Parkway, Suite 1200, Dallas, TX 75254, by personal delivery or by mail postmarked no later than the seventh (7th) day after the Executive signs the Termination Release. If Executive does not so timely revoke his acceptance, this Termination Release shall become effective and enforceable. The Executive acknowledges and agrees that any changes in the terms of this Termination Release, whether material or immaterial, after the date upon which the Executive first received this Termination Release shall not affect or restart the above-referenced twenty-one (21)-day consideration period.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, and intending to be legally bound hereby, the parties hereto have executed this Termination Release as of the day and year first above written.
| ASHFORD HOSPITALITY ADVISORS, LLC | ||
| By: | /s/ Jim Plohg | |
| Name: | Jim Plohg | |
| Title: | Executive Vice President | |
| Dated: | November 10, 2026 | |
| ASHFORD INC. | ||
| By: | /s/ Jim Plohg | |
| Name: | Jim Plohg | |
| Title: | Executive Vice President | |
| Dated: | November 10, 2026 | |
| EXECUTIVE: | ||
| /s/ Richard J. Stockton | ||
| RICHARD J. STOCKTON | ||
| Dated: | November 10, 2026 | |
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Exhibit 10.4
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into this 10th day of November, 2026, by and among BHR Luxury Hotels Management, LLC, a Texas limited liability company (the “Company”), Braemar Hotels & Resorts Inc., a Maryland corporation (“Parent”), and Justin R. Coe (the “Executive”).
RECITALS
THE PARTIES ENTER THIS AGREEMENT on the basis of the following facts, understandings and intentions:
A. The Company desires to offer the Executive the benefits set forth in this Agreement and provide for the services of the Executive on the terms and conditions set forth in this Agreement.
B. The Executive desires to be employed by the Company on the terms and conditions set forth in this Agreement.
C. This Agreement shall govern the employment relationship between the Executive and the Company and all of its Affiliates effective as of the Effective Date (as defined below), and supersedes and negates any previous agreements with respect to such relationship.
AGREEMENT
NOW, THEREFORE, in consideration of the above recitals incorporated herein and the mutual covenants and promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby expressly acknowledged, the parties agree as follows:
| 1. | Retention and Duties. |
| 1.1 | Retention. The Company does hereby agree to employ the Executive for the Period of Employment (as such term is defined in Section 2) on the terms and conditions expressly set forth in this Agreement. The Executive does hereby accept and agree to such employment, on the terms and conditions expressly set forth in this Agreement. Certain capitalized terms used herein are defined in Section 5.5 of this Agreement. |
| 1.2 | Duties. During the Period of Employment, the Executive shall serve Parent as its Chief Financial Officer, Chief Accounting Officer and Treasurer and shall have the powers, authorities, duties and obligations generally consistent with that position as the Company may assign from time to time, all subject to the directives of the Chief Executive Officer and the corporate policies of the Company as they are in effect from time to time throughout the Period of Employment (including, without limitation, the Company's business conduct and ethics policies, as they may change from time to time). During the Period of Employment, the Executive shall report to the Chief Executive Officer. In the event that the Executive serves as director or senior executive officer of one or more Affiliates, the Executive shall do so without additional compensation. |
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| 1.3 | No Other Employment; Minimum Time Commitment. During the Period of Employment, the Executive shall: (i) devote substantially all of the Executive’s business time, energy and skill to the performance of the Executive’s duties for the Company; (ii) perform such duties in a faithful, effective and efficient manner to the best of the Executive’s abilities; and (iii) hold no other employment. The Executive’s service on the boards of directors (or similar body) of other public companies is subject to the prior written approval of the Board of Directors of Parent (the “Board”). The Company shall have the right to require the Executive to resign from any board or similar body (including, without limitation, any association, corporate, civic or charitable board or similar body) which the Executive may then serve if the Board reasonably determines that the Executive’s service on such board or body interferes with the effective discharge of the Executive’s duties and responsibilities to the Company or that any business related to such service is then in direct or indirect competition with any business of the Company or any of its Affiliates, successors or assigns. |
| 1.4 | No Breach of Contract. The Executive hereby represents to the Company and agrees that: (i) the execution and delivery of this Agreement by the Executive and the Company and the performance by the Executive of the Executive’s duties hereunder do not and shall not constitute a breach of, conflict with, or otherwise contravene or cause a default under, the terms of any other agreement or policy to which the Executive is a party or otherwise bound or any judgment, order or decree to which the Executive is subject; (ii) the Executive will not enter into any new agreement that would or reasonably could contravene or cause a default by the Executive under this Agreement; (iii) the Executive has no information (including, without limitation, confidential information and trade secrets) relating to any other Person which would prevent, or be violated by, the Executive entering into this Agreement or carrying out the Executive’s duties hereunder; (iv) the Executive is not bound by any employment, consulting, non-compete, non-solicitation, confidentiality, trade secret or similar agreement (other than this Agreement) with any other Person (other than ongoing, customary confidentiality obligations as to confidential information obtained from prior employers in the course of the Executive’s prior employment with them); (v) to the extent the Executive has any confidential or similar information that the Executive is not free to disclose to the Company, the Executive will not disclose or bring on to the Company’s premises, computer networks, communications or systems, computers or any other devices or accounts, any such information to the extent such disclosure or transmission would violate applicable law or any other agreement or policy to which the Executive is a party or by which the Executive is otherwise bound; (vi) the Executive has not committed any acts of sexual harassment or any other type of workplace misconduct that would interfere with Executive carrying out the Executive’s duties hereunder; and (vii) the Executive understands the Company will rely upon the accuracy and truth of the representations and warranties of the Executive set forth herein and the Executive consents to such reliance. |
| 1.5 | Location. The Executive’s principal place of employment shall be the Company’s principal executive office as it may be located from time to time. The Executive agrees that the Executive will be regularly present at that office during regular business hours (except for required business travel, holidays, vacation and other leaves consistent with this Agreement) as reasonably required and consistent with the Company’s policies regarding remote work. The Executive acknowledges that the Executive will be required to travel from time to time in the course of performing the Executive’s duties for the Company. |
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| 2. | Period of Employment. The “Period of Employment” shall be a period of three (3) years commencing on November 10, 2026 (the “Effective Date”) and ending at the close of business on the third (3rd) anniversary of the Effective Date (the “Termination Date”); provided, however, that this Agreement shall be automatically renewed, and the Period of Employment shall be automatically extended for one (1) additional year on the Termination Date and each anniversary of the Termination Date thereafter, unless either party gives written notice at least sixty (60) days prior to the expiration of the Period of Employment (including any renewal thereof) of such party’s desire to terminate the Period of Employment (such notice to be delivered in accordance with Section 18). The term “Period of Employment” shall include any extension thereof pursuant to the preceding sentence. Notwithstanding the foregoing, the Period of Employment is subject to earlier termination as provided below in this Agreement. |
| 3. | Compensation. |
| 3.1 | Base Salary. During the Period of Employment, the Company shall pay the Executive a base salary (the “Base Salary”), which shall be paid in accordance with the Company’s regular payroll practices in effect from time to time. The Executive’s Base Salary shall be at an annualized rate of $450,000. The Compensation Committee of the Board (the “Compensation Committee”) will review the Executive’s rate of Base Salary on an annual basis and may, in its sole discretion, increase (but not decrease) the Executive’s Base Salary. |
| 3.2 | Incentive Bonus. The Executive shall be eligible to receive a cash incentive bonus for each fiscal year of the Company that occurs during the Period of Employment ("Incentive Bonus"). Notwithstanding the foregoing, except as otherwise expressly provided in this Agreement, the Executive must be employed by the Company at the time the Company pays incentive bonuses to employees generally with respect to a particular fiscal year in order to earn and be eligible for an Incentive Bonus for that year (and, if the Executive is not so employed at such time, in no event shall the Executive have been considered to have "earned" any Incentive Bonus with respect to the fiscal year), except as otherwise provided herein. Beginning with the Company's 2026 fiscal year, the Executive's target Incentive Bonus shall equal 100% of the Base Salary, the Executive's maximum Incentive Bonus shall equal 150% of the Base Salary, and the Executive's threshold Incentive Bonus shall equal 50% of the Base Salary. The Executive's actual Incentive Bonus amount for a particular fiscal year shall be determined by the Compensation Committee, based on performance objectives (which may include corporate, business unit or division, financial, strategic, individual or other objectives) established with respect to that particular fiscal year by the Compensation Committee. Any Incentive Bonus that becomes payable for a fiscal year shall be paid no later than June 1 of the year following the fiscal year for which such bonus was earned. |
| 3.3 | Long-Term Incentive Compensation. During the Period of Employment, the Executive shall be eligible to participate in the Company’s or its Affiliates’ long-term incentive or other equity incentive plans applicable to similarly situated executives, as such plans may be adopted or amended from time to time, in each case subject to the terms of such plans and award agreements thereunder. |
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| 4. | Benefits. |
| 4.1 | Retirement, Welfare and Fringe Benefits. During the Period of Employment, the Executive shall be entitled to participate, on a basis generally consistent with other similarly situated executives, in all employee pension and welfare benefit plans and programs, and fringe benefit plans and programs and all other benefit plans and programs that are made available by the Company to the Company’s other similarly situated executives generally, in accordance with the eligibility and participation provisions of such plans and as such plans or programs may be in effect from time to time. |
| 4.2 | Reimbursement of Business Expenses. The Executive is authorized to incur reasonable expenses in carrying out the Executive’s duties for the Company under this Agreement and shall be entitled to reimbursement for all reasonable business expenses the Executive incurs during the Period of Employment in connection with carrying out the Executive’s duties for the Company, subject to the Company’s expense reimbursement policies and any pre-approval policies in effect from time to time. The Executive agrees to promptly submit and document any reimbursable expenses in accordance with the Company’s expense reimbursement policies to facilitate the timely reimbursement of such expenses. |
| 4.3 | Vacation and Other Leave. During the Period of Employment, the Executive shall accrue annual vacation on the same basis as other similarly situated executives, with such vacation to accrue and be subject to the Company’s vacation policies applicable to such similarly situated executives in effect from time to time, including any unlimited vacation policy or any policy which may limit vacation accruals and/or limit the amount of accrued but unused vacation to carry over from year to year. The Executive shall also be entitled to all other holiday and leave pay generally available to other similarly situated executives of the Company. |
| 5. | Termination. |
| 5.1 | Termination by the Company. During the Period of Employment, the Executive’s employment by the Company, and the Period of Employment, may be terminated at any time by the Company: (i) with Cause; or (ii) without Cause; or (iii) in the event of the Executive’s death; or (iv) in the event that the Board determines in good faith that the Executive has a Disability. |
| 5.2 | Termination by the Executive. During the Period of Employment, the Executive’s employment by the Company, and the Period of Employment, may be terminated by the Executive with no less than thirty (30) days advance written notice to the Company (such notice to be delivered in accordance with Section 18); provided, however, that in the case of a termination for Good Reason, the Executive may provide immediate written notice of termination once the applicable cure period (as contemplated by the definition of Good Reason) has lapsed if the Company has not reasonably cured the circumstances that gave rise to the basis for the Good Reason termination. |
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| 5.3 | Benefits upon Termination. If the Executive’s employment by the Company is terminated during the Period of Employment for any reason by the Company or by the Executive, or upon or following the expiration of the Period of Employment (the date that the Executive’s employment by the Company terminates is referred to as the “Severance Date”), the Company shall have no further obligation to make or provide to the Executive, and the Executive shall have no further right to receive or obtain from the Company, any payments or benefits except as follows: |
(a) The Company shall pay the Executive (or, in the event of the Executive’s death, the Executive’s estate) any Accrued Obligations. Any Prior-Year Bonus that becomes payable will be paid when the Incentive Bonus for active employees is scheduled to be paid, in accordance with Section 3.2.
(b) If the Executive’s employment with the Company terminates during the Period of Employment as a result of a termination by the Company without Cause (other than due to the Executive’s death or Disability), a resignation by the Executive for Good Reason, or the Company’s notice not to renew this Agreement and to terminate the Period of Employment, the Executive shall be entitled to the following benefits:
(i) The Company shall pay the Executive (in addition to the Accrued Obligations), subject to tax withholding and other authorized deductions, an amount equal to the sum of two (2) times (the "Severance Multiple"): (A) the Executive's Base Salary at the annualized rate in effect on the Severance Date; and (B) the average Incentive Bonus received by the Executive for the three (3) completed calendar years preceding the Severance Date (or the number of completed calendar years the Executive has been employed by the Company on the Severance Date, if such number is fewer than three (3) years), provided, that if the Executive's Severance Date occurs prior to the first (1st) anniversary of the Effective Date, such amount shall equal the target Incentive Bonus. Such amount is referred to hereinafter as the "Severance Benefit." Subject to Section 5.7(b), the Company shall pay the Severance Benefit to the Executive in a lump sum payable on (or within ten (10) days following) the effective date of the Executive's Release, provided that if the period to review the Release spans two (2) calendar years, the Severance Benefit shall be paid in the second (later) calendar year.
(ii) The Company will either: (A) pay for the Executive’s premiums charged to continue healthcare coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act or similar state law (“COBRA”), at the same or reasonably equivalent medical, dental, and vision coverage for the Executive (and, if applicable, the Executive’s eligible dependents) as in effect immediately prior to the Severance Date, to the extent that the Executive elects such continued coverage; or (B) to the extent COBRA coverage is not available, provide the Executive with a monthly cash payment equal to the cost to continue medical, dental, and vision coverage under COBRA; provided that the Company’s obligation to make any payment pursuant to this clause (ii) shall, subject to Section 5.7(a), commence with continuation coverage for the month following the month in which the Executive’s Separation from Service occurs and shall cease with continuation coverage for the twenty-fourth (24th) month following the month in which the Executive’s Separation from Service occurs (or, if earlier, shall cease upon the date the Executive becomes eligible for coverage under the health plan of a future employer). To the extent the Executive elects COBRA coverage, the Executive shall notify the Company in writing of such election prior to such coverage taking effect and complete any other continuation coverage enrollment procedures the Company may then have in place. In addition, the Company shall reimburse the Executive for the cost of premiums to continue life insurance and long-term disability coverage as in effect immediately prior to the Severance Date for twenty-four (24) months, payable in monthly installments following the Executive’s Separation from Service.
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(iii) With respect to the fiscal year in which the Severance Date occurs, the Company shall pay the Executive the Incentive Bonus that would otherwise have been paid (but not less than the amount payable at the target level set forth in Section 3.2) to the Executive had the Executive’s employment with the Company not terminated with respect to that fiscal year, multiplied by a fraction, the numerator of which is the total number of days in such fiscal year in which the Executive was employed by the Company and the denominator of which is the total number of days in such fiscal year (the “Pro-Rata Bonus”). Any Pro-Rata Bonus that becomes payable will be paid when the Severance Benefit is paid, in accordance with Section 3.2.
(iv) The Executive shall become fully vested in any unvested equity awards subject to time-based vesting that are outstanding on the Severance Date, with any awards subject to performance conditions that are in progress as of the Severance Date to vest on a pro-rated basis (based on number of days employed as a percentage of the applicable performance period) at the greater of: (A) the target performance level; or (B) the level otherwise provided in the applicable award agreement based on actual performance.
(c) If the Executive’s employment with the Company terminates during the Period of Employment due to the Executive’s death or Disability, the Executive shall be entitled to the benefits described in Section 5.3(b) above, except that the Severance Multiple shall be one (1).
(d) If the Executive’s employment with the Company terminates during the Period of Employment as a result of a resignation by the Executive without Good Reason (which shall include the Executive’s notice not to renew this Agreement and to terminate the Period of Employment), the Executive shall be entitled to the benefits described in Section 5.3(b)(ii) above. In addition, subject to the Executive’s compliance with the Restrictive Covenants described in Sections 6.2, 6.3, and 6.4 below, the Executive shall be entitled to the benefits described in Section 5.3(b)(i) above, except that: (A) the Severance Multiple shall be one (1); and (B) such payment will be made in twelve (12) substantially equal monthly installments, with the first installment payable on (or within ten (10) days following) the effective date of the Executive’s Release, provided that if the period to review the Release spans two (2) calendar years, such first installment shall be paid in the second (later) calendar year, and to include any installment that was otherwise delayed following the Executive’s Separation from Service.
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(e) Notwithstanding the foregoing provisions of this Section 5.3, if the Executive breaches the Executive’s obligations under Section 6 of this Agreement at any time, from and after the date of such breach and not in any way in limitation of any right or remedy otherwise available to the Company, the Executive will no longer be entitled to, and the Company will no longer be obligated to pay, any remaining unpaid portion of the Severance Benefit or any Prior-Year Bonus, Pro-Rata Bonus, equity acceleration for any outstanding and unvested equity awards that remain outstanding at the time of the breach, or the benefits described in Section 5.3(b)(ii) or Section 5.3(d); provided that, if the Executive provides the Release required by Section 5.4, in no event shall the Executive be entitled to benefits pursuant to this Section 5.3 of less than $5,000, which amount the parties agree is good and adequate consideration, in and of itself, for the Executive’s Release required by Section 5.4.
(f) The foregoing provisions of this Section 5.3 shall not affect: (i) the Executive’s receipt of benefits otherwise due to terminated employees under group insurance coverage consistent with the terms of the applicable Company welfare benefit plan; (ii) the Executive’s rights under COBRA to continue health coverage; or (iii) the Executive’s receipt of benefits otherwise due in accordance with the terms of the Company’s 401(k) plan (if any).
| 5.4 | Release; Exclusive Remedy; Leave. |
(a) This Section 5.4 shall apply notwithstanding anything else contained in this Agreement or any equity-based award agreement to the contrary. As a condition precedent to any Company obligation to the Executive pursuant to Section 5.3(b) or (d) or any other obligation to accelerate vesting of any equity-based award in connection with the termination of the Executive’s employment, the Executive shall provide the Company with a valid, executed general release agreement in substantially the form attached hereto as Exhibit A (the “Release”), and such Release shall have not been revoked by the Executive pursuant to any revocation rights afforded by applicable law. The Company shall provide the final form of Release to the Executive not later than seven (7) days following the Severance Date, and the Executive shall be required to execute and return the Release to the Company within twenty-one (21) days (or forty-five (45) days if such longer period of time is required to make the Release maximally enforceable under applicable law).
(b) The Executive agrees that the payments and benefits contemplated by Section 5.3 (and any applicable acceleration of vesting of an equity-based award in accordance with the terms of such award in connection with the termination of the Executive’s employment) shall constitute the exclusive and sole remedy for any termination of the Executive’s employment and the Executive covenants not to assert or pursue any other remedies, at law or in equity, with respect to any termination of employment. The Company and the Executive acknowledge and agree that there is no duty of the Executive to mitigate damages under this Agreement. All amounts paid to the Executive pursuant to Section 5.3 shall be paid without regard to whether the Executive has taken or takes actions to mitigate damages. The Executive agrees to resign, on the Severance Date, as an officer and director of the Company and any Affiliate of the Company, and as a fiduciary of any benefit plan of the Company or any Affiliate of the Company, and to promptly execute and provide to the Company any further documentation, as requested by the Company, to confirm such resignation, and to remove himself as a signatory on any accounts maintained by the Company or any of its Affiliates (or any of their respective benefit plans) at the Company’s sole cost and expense.
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(c) In the event that the Executive provides the Company notice of termination pursuant to Section 5.2, the Company will have the option to place the Executive on paid administrative leave during the notice period.
| 5.5 | Certain Defined Terms. |
(a) As used herein, “Accrued Obligations” means:
(i) any Base Salary that had accrued but had not been paid (including accrued and unpaid vacation time) on or before the Severance Date;
(ii) any reimbursement due to the Executive pursuant to Section 4.2 for expenses incurred by the Executive on or before the Severance Date and documented, to the extent applicable, in accordance with the Company’s expense reimbursement policies in effect at the applicable time; and
(iii) any Incentive Bonus that would otherwise be paid to the Executive had the Executive’s employment with the Company not terminated with respect to any fiscal year that ended before the Severance Date, to the extent not theretofore paid (the “Prior-Year Bonus”).
(b) As used herein, “Affiliate” of the Company means a Person that directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Company. As used in this definition, the term “control,” including the correlative terms “controlling,” “controlled by” and “under common control with,” means the possession, directly or indirectly, of the power to direct or cause the direction of management or policies (whether through ownership of securities or any partnership or other ownership interest, by contract or otherwise) of a Person.
(c) As used herein, “Cause” shall mean, as reasonably determined by the Board (excluding the Executive, if the Executive is then a member of the Board) based on the information then known to it, that one or more of the following has occurred:
(i) the conviction of the Executive of, or the entry of a plea of guilty or nolo contendere by the Executive to, a felony (exclusive of a conviction, plea of guilty or nolo contendere arising under a statutory provision imposing criminal liability upon the Executive on a per se basis due to any offices held by the Executive pursuant to the terms of this Agreement, so long as any act or omission of the Executive with respect to such matter was not taken or omitted in contravention of any applicable policy or directive of the Chief Executive Officer or the Board);
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(ii) the Executive's willful breach of the Executive's duty of loyalty which is materially detrimental to the Company or any of its Affiliates and which is not cured to the reasonable satisfaction of the Board within thirty (30) days following written warning to the Executive from the Chief Executive Officer or the Board describing the alleged circumstances; provided that if there is an inconsistency in directives given by the Board as compared to a directive from the Company's Chief Executive Officer, the Board directives shall control;
(iii) gross negligence or willful misconduct in the performance of the Executive's duties (which is not cured by the Executive within thirty (30) days after written warning from the Chief Executive Officer or the Board);
(iv) the Executive’s willful commission of an act of dishonesty resulting in material economic or financial injury to the Company or any of its Affiliates, or willful commission of fraud; or
(v) the Executive's chronic absence from work for reasons other than illness, Disability (as defined below), or business - related travel which is not cured to the reasonable satisfaction of the Chief Executive Officer or the Board within thirty (30) days following written warning to the Executive from the Chief Executive Officer or the Board describing the alleged circumstances.
For purposes of this Section 5.5(c), no act, or failure to act, on the Executive's part will be deemed "willful" unless done, or omitted to be done, by the Executive not in good faith and without a reasonable belief that the Executive's act, or failure to act, was in the best interest of the Company or any of its Affiliates. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board, a directive of the Company's Chief Executive Officer, or based upon the advice of outside counsel for the Company or its Affiliates shall be conclusively presumed to have been done, or omitted, by the Executive in good faith and in the best interests of the Company and its Affiliates.
(d) As used herein, “Disability” shall mean a physical or mental impairment which, as reasonably determined by the Board, renders the Executive unable to perform the essential functions of the Executive’s employment with the Company, even with reasonable accommodation that does not impose an undue hardship on the Company, for more than ninety (90) days in any one hundred eighty (180)-day period, unless a longer period is required by federal or state law, in which case that longer period would apply. The Executive agrees to reasonably cooperate with the Board in making any such determination as to the existence of Disability.
| (e) | As used herein, “Good Reason” shall mean the occurrence (without the Executive’s written consent) of any one or more of the following conditions: |
(i) any diminution in the Executive’s Base Salary or Incentive Bonus (including any reduction to the threshold, target, or maximum Incentive Bonus levels (as set forth in Section 3.2));
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(ii) any diminution, not consented to by the Executive in a writing signed by the Executive, in the nature or scope of the Executive's responsibilities, authorities, powers, functions, title or duties, which shall be determined taking into account that Parent is, as of the Effective Date, a public company and shall specifically include: (A) any requirement to report directly to any individual other than the Chief Executive Officer; and (B) any requirement to report, directly or indirectly, to any executive of any Affiliate that is the parent company of, or otherwise controls, Parent;
(iii) a material change in the geographic location of the Executive’s principal office with the Company to a location outside the greater Dallas, Texas metropolitan area; or
(iv) a material breach by the Company of this Agreement or any other material agreement in effect between the Executive and the Company or any of its Affiliates;
provided, however, that any such condition or conditions, as applicable, shall not constitute Good Reason unless both: (x) the Executive provides written notice to the Company of the condition claimed to constitute Good Reason within thirty (30) days of the initial existence of such condition(s) (such notice to be delivered in accordance with Section 18); and (y) the Company fails to remedy such condition(s) within thirty (30) days of receiving such written notice thereof; and provided, further, that in all events the termination of the Executive’s employment with the Company shall not constitute a termination for Good Reason unless such termination occurs not more than one hundred twenty (120) days following the initial existence of the condition claimed to constitute Good Reason.
(f) As used herein, the term “Person” shall be construed broadly and shall include, without limitation, an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.
(g) As used herein, “Restricted Period” means the period beginning on the Effective Date and ending on the first (1st) anniversary of the Executive’s Severance Date.
(h) As used herein, a “Separation from Service” occurs when the Executive dies, retires, or otherwise has a termination of employment with the Company that constitutes a “separation from service” within the meaning of Treasury Regulation Section 1.409A-1(h)(1), without regard to the optional alternative definitions available thereunder.
| 5.6. | Notice of Termination; Employment Following Expiration of Period of Employment. Any termination of the Executive’s employment under this Agreement shall be communicated by written notice of termination from the terminating party to the other party. This notice of termination must be delivered in accordance with Section 18 and must indicate the specific provision(s) of this Agreement relied upon in effecting the termination and the basis of any termination by the Company for Cause or by the Executive for Good Reason. |
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| 5.7 | Section 409A. |
| (a) | It is intended that any amounts payable under this Agreement shall either be exempt from or comply with Section 409A of the Code (including the Treasury regulations and other published guidance relating thereto) (“Code Section 409A”) so as not to subject the Executive to payment of any additional tax, penalty or interest imposed under Code Section 409A. The provisions of this Agreement shall be construed and interpreted to avoid the imputation of any such additional tax, penalty or interest under Code Section 409A yet preserve (to the nearest extent reasonably possible) the intended benefit payable to the Executive. Any installment payments provided for in this Agreement shall be treated as a series of separate payments for purposes of Code Section 409A. The Company makes no representation that any or all of the payments described in this Agreement will be exempt from or comply with Code Section 409A, and the Executive is solely responsible for any additional taxes, penalties or interest imposed under Code Section 409A. |
| (b) | If the Executive is a “specified employee” within the meaning of Treasury Regulation Section 1.409A-1(i) as of the date of the Executive’s Separation from Service, the Executive shall not be entitled to any payment or benefit pursuant to this Agreement until the earlier of: (i) the date which is six (6) months after the Executive’s Separation from Service for any reason other than death; or (ii) the date of the Executive’s death. The provisions of this Section 5.7(b) shall only apply if, and to the extent, required to avoid the imputation of any tax, penalty or interest pursuant to Code Section 409A. Any amounts otherwise payable to the Executive upon or in the six (6) month period following the Executive’s Separation from Service that are not so paid by reason of this Section 5.7(b) shall be paid (without interest) as soon as practicable (and in all events within thirty (30) days) after the date that is six (6) months after the Executive’s Separation from Service (or, if earlier, as soon as practicable, and in all events within thirty (30) days, after the date of the Executive’s death). |
| (c) | To the extent that any benefits or reimbursements pursuant to this Agreement are taxable to the Executive, any reimbursement payment due to the Executive pursuant to any such provision shall be paid to the Executive on or before the last day of the Executive’s taxable year following the taxable year in which the related expense was incurred. The benefits and reimbursements pursuant to such provisions are not subject to liquidation or exchange for another benefit and the amount of such benefits and reimbursements that the Executive receives in one taxable year shall not affect the amount of such benefits or reimbursements that the Executive receives in any other taxable year. |
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| 5.8 | Possible Limitation of Benefits in Connection with a Change in Control. Notwithstanding anything contained in this Agreement to the contrary, if following a change in ownership or effective control or in the ownership of a substantial portion of assets (in each case, within the meaning of Section 280G of the Code), the tax imposed by Section 4999 of the Code or any similar or successor tax (the “Excise Tax”) applies to any payments, benefits and/or amounts received by the Executive pursuant to this Agreement or otherwise, including, without limitation, any acceleration of the vesting of outstanding equity awards (collectively, the “Total Payments”), then the Total Payments shall be reduced (but not below zero) so that the maximum amount of the Total Payments (after reduction) shall be one dollar ($1.00) less than the amount which would cause the Total Payments to be subject to the Excise Tax; provided that such reduction to the Total Payments shall be made only if the total after-tax benefit to the Executive is greater after giving effect to such reduction than if no such reduction had been made. If such a reduction is required, the Company shall reduce or eliminate the Total Payments by first reducing or eliminating any cash payments under this Agreement, then by reducing or eliminating any accelerated vesting of equity awards, then by reducing or eliminating any other remaining Total Payments, in each case in reverse order beginning with the payments which are to be paid the farthest in time from the date of the transaction triggering the Excise Tax. The provisions of this Section 5.8 shall take precedence over the provisions of any other plan, arrangement or agreement governing the Executive’s rights and entitlements to any benefits or compensation. |
| 6. | Protective Covenants. |
| 6.1 | Confidential Information. The Executive recognizes and acknowledges that the Executive has, will have access to, and will receive confidential and proprietary information of the Company and its Affiliates, which, in each case, constitute valuable, special, and unique assets of such entity. The term “Confidential Information” as used in this Agreement shall mean all non-public information of the Company and its Affiliates, as applicable, including, without limitation, information regarding clients, customers, pricing policies, methods of operation, proprietary company programs, sales, acquisitions, products, profits, costs, conditions (financial or other), cash flows, key personnel, formulae, product applications, technical processes, and trade secrets, as such information may exist from time to time, which the Executive acquired or obtained by virtue of work performed for the Company (whether prior to or after the Effective Date), or which the Executive may acquire or may have acquired knowledge of during the performance of said work. |
The Executive acknowledges that the Company has put in place certain policies and practices to keep such Confidential Information secret, including disclosing Confidential Information only on a need-to-know basis. The Executive further acknowledges that the Confidential Information has been developed or acquired by the Company through the expenditure of substantial time, effort, and money and provides the Company with an advantage over competitors who do not know such Confidential Information. Finally, the Executive acknowledges that such Confidential Information, if revealed to or used for the benefit of the Company’s competitors or in a manner contrary to the Company’s interests, would cause extensive and immeasurable harm to the Company and to the Company’s competitive position.
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The Executive shall not, during the Period of Employment or at any time thereafter, use for personal gain, for the benefit of any third party, or detrimentally to the Company all or any part of the Confidential Information, or disclose or make available all or any part of the Confidential Information to any person, firm, corporation, association, or any other entity for any reason or purpose whatsoever, directly or indirectly, except as may be required pursuant to the Executive’s employment hereunder, unless and until such Confidential Information becomes publicly available other than as a consequence of the breach by the Executive of the Executive’s confidentiality obligations hereunder. Notwithstanding the foregoing, Executive shall not be restricted from disclosing or using Confidential Information that: (i) is or becomes generally available to the public other than as a result of an unauthorized disclosure by Executive or the Executive’s agent; (ii) becomes available to the Executive in a manner that is not in contravention of applicable law or in violation of any confidentiality or similar agreement from a source (other than the Company, its Affiliates, or their officers, employees, agents or representatives) that is not known by Executive, after reasonable investigation, to be bound by a confidential relationship with the Company or any Affiliate or by a confidentiality or other similar agreement; or (iii) is required to be disclosed by law, court order or other legal process; provided, however, that in the event disclosure is required by law, court order or legal process, Executive shall provide the Company, if legally permissible, with prompt notice of such requirement as set forth below in this Section 6.1.
The Executive acknowledges that the Confidential Information shall remain at all times the exclusive property of the Company, and no license is granted to the Executive. In the event of the termination of the Executive’s employment, whether voluntary or involuntary and whether by the Company or the Executive, or within seven (7) days of the Company’s request under any other circumstances, the Executive shall deliver to the Company all Confidential Information, in any form whatsoever, including electronic formats, and shall not take with him any Confidential Information or any reproductions (in whole or in part) or extracts of any items relating to the Confidential Information. The Company acknowledges that prior to the Executive’s employment with the Company, the Executive has lawfully acquired extensive knowledge of the industries in which the Company engages in business including, without limitation, markets, valuation methods and techniques, capital markets, investor relationships and similar items, and that the provisions of this Section 6.1 are not intended to restrict the Executive’s use of such previously acquired knowledge.
By this Agreement, the Company is providing the Executive with rights that the Executive did not previously have. In exchange for the foregoing and the additional terms agreed to in this Agreement, the Executive agrees that: (i) the Executive is being provided with access to and has received and will receive Confidential Information to which the Executive has not previously had access; and (ii) all goodwill developed with the Company’s clients, customers and other business contacts by the Executive is the exclusive property of the Company and that the Executive has benefited from such goodwill. The Executive waives and releases any claim that he should be able to use, for the benefit of any competing person or entity, client and customer goodwill or Confidential Information that was previously received or developed by the Executive while working for the Company or any Affiliate.
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| 6.2 | Restriction on Competition. During the Restricted Period, the Executive will not, directly or indirectly, either as a principal, agent, employee, employer, stockholder or partner engage in any “Competitive Business;” provided, however, that the foregoing shall not prohibit or limit the Executive’s right to pursue and maintain passive investments allowed pursuant to this Section 6.2. For purposes of this Section 6.2, “Competitive Business” means a business whose primary business is acquiring, investing in or with respect to, owning or leasing hotel properties in the United States or in any international market in which the Company or its Affiliates conduct such business or originating or acquiring loans in respect of hotel properties in the United States or in any international market in which the Company or its Affiliates conduct such business, in each case, where the Executive had duties or performed services for the Company, which the parties stipulate is a reasonable geographic area because of the scope of the Company’s operations and the Executive’s employment with the Company. The Executive may not avoid the purpose and intent of this restriction by engaging in conduct within the geographically limited area from a remote location through means such as telecommunications, written correspondence, computer generated or assisted communications, or other similar methods. |
| 6.3 | Non-Solicitation of Employees. The Executive covenants and agrees that during the Restricted Period, the Executive shall not, without the prior written consent of the Company, directly or indirectly, whether for the Executive’s own account or on behalf of any person, firm, corporation, partnership, association or other entity or enterprise, solicit, recruit, hire or cause to be hired any employees of the Company or any of its Affiliates, or any person who was an employee of the Company during the six (6) months preceding the Executive’s Severance Date, or solicit or encourage any employee of the Company or any of its Affiliates to leave the employment of the Company or any of such Affiliates, as applicable. The parties hereto agree that: (i) the placement of general advertisements that may be targeted to a particular geographic or technical area but which are not targeted directly or indirectly towards any employees, officers, agents or representatives of the Company (or any successor entity) shall not be deemed a breach of this Section 6.3; and (ii) the employment or engagement of such persons by an entity that is not controlled by the Executive and whom the Executive did not encourage, solicit or induce or in any manner attempt to encourage, solicit or induce to terminate such person’s employment with the Company shall not be deemed a breach of this Section 6.3. |
| 6.4 | Non-Interference with Customers. The Executive understands and agrees that all business opportunities related to the business of the Company and its Affiliates that arise during the Period of Employment constitute valuable assets of the Company and its Affiliates, and may not be converted to the Executive’s own use or converted by Executive for the use of any person, firm, corporation, partnership, association or other entity or enterprise. Accordingly, Executive agrees that, during the Restricted Period, the Executive shall not, directly or indirectly, whether for the Executive’s own account or on behalf of any person, firm, corporation, partnership, association or other entity or enterprise, interfere with, solicit, pursue, or in any manner make use of any such business opportunities. |
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| 6.5 | Non-Disparagement. The Executive agrees that, during the Period of Employment and thereafter (including following the Executive’s termination of employment for any reason) the Executive will not make statements or representations, or otherwise communicate, directly or indirectly, in writing, orally, or otherwise, or take any action which may, directly or indirectly, disparage the Company or its Affiliates or their respective officers, directors, employees, advisors, businesses or reputations. The Company agrees that, during the Period of Employment and thereafter (including following Executive’s termination of employment for any reason), the Company’s directors, officers or other employees will not make statements or representations, or otherwise communicate, directly or indirectly, in writing, orally, or otherwise, or take any action which may directly or indirectly, disparage Executive or the Executive’s family or the Executive’s business or reputation; provided, however, the Company shall have no liability for any communication by its employees (other than its officers) that violates this non-disparagement clause, unless an officer of the Company is made aware of such communication and fails to take appropriate action to enforce this non-disparagement clause on behalf of the Company. Notwithstanding the foregoing, nothing in this Agreement shall preclude either Executive or the Company from making truthful statements or disclosures that are required by applicable law, regulation, or legal process. Notwithstanding the foregoing, nothing in this Agreement prohibits the Executive from reporting possible violations of federal law or regulation to any government agency or entity or making any other disclosure protected under whistleblower provisions of law. The Executive does not need prior authorization to make such reports or disclosures and is not required to notify the Company that the Executive has made any such report of disclosure. |
| 6.6 | Protected Disclosures; Defend Trade Secrets Act. Pursuant to the Defend Trade Secrets Act of 2016, the Executive acknowledges that the Executive may not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of Confidential Information that: (a) is made in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney solely for the purpose of reporting or investigating a suspected violation of law; or (b) is made in a complaint or other document that is filed in a lawsuit or other proceeding, provided that such filing is made under seal. Further, the Company shall not retaliate against the Executive in any way for any such disclosure made in accordance with applicable law. In the event a disclosure is made, and the Executive files any type of proceeding against the Company alleging that the Company retaliated against the Executive because of the Executive’s disclosure, the Executive may disclose the relevant Confidential Information to the Executive’s attorney and may use the Confidential Information in the proceeding if: (x) the Executive files any document containing the Confidential Information under seal; and (y) the Executive does not otherwise disclose the Confidential Information except pursuant to court or arbitral order. |
Nothing in this Section 6 or elsewhere in this Agreement shall prevent the Executive from: (A) responding to a lawful subpoena; (B) reporting to a government agency; (C) participating in an investigation by a government agency; (D) providing truthful testimony under oath; (E) exercising the Executive’s rights under Section 7 of the National Labor Relations Act; (F) disclosing or discussing information about unlawful acts in the workplace, such as harassment, including sexual harassment, discrimination, or any other conduct that Employee has reason to believe is unlawful; (G) disclosing information about sexual assault or sexual abuse; or (H) complying with any other legal obligation.
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| 6.7 | Understanding of Covenants. The Executive acknowledges that, in the course of the Executive’s employment with the Company and/or its Affiliates and their predecessors, the Executive has become familiar, or will become familiar, with the Company’s and its Affiliates’ and their predecessors’ trade secrets and with other confidential and proprietary information concerning the Company, its Affiliates and their respective predecessors and that the Executive’s services have been and will be of special, unique and extraordinary value to the Company and its Affiliates. The Executive agrees that the foregoing covenants set forth in this Section 6 (together, the “Restrictive Covenants”) are reasonable and necessary to protect the Company’s and its Affiliates’ trade secrets and other confidential and proprietary information, good will, stable workforce, and customer relations. |
Without limiting the generality of the Executive’s agreement in the preceding paragraph, the Executive: (i) represents that the Executive is familiar with and has carefully considered the Restrictive Covenants; (ii) represents that the Executive is fully aware of the Executive’s obligations hereunder; (iii) agrees to the reasonableness of the length of time, scope and geographic coverage, as applicable, of the Restrictive Covenants; (iv) agrees that the Company and its Affiliates currently conduct business throughout the United States and may expand its business outside of the United States; and (v) agrees that the Restrictive Covenants will continue in effect for the applicable periods set forth above in this Section 6 regardless of whether the Executive is then entitled to receive severance pay or benefits from the Company. The Executive understands that the Restrictive Covenants may limit the Executive’s ability to earn a livelihood in a business similar to the business of the Company and any of its Affiliates, but the Executive nevertheless believes that the Executive has received and will receive sufficient consideration and other benefits as an employee of the Company and as otherwise provided hereunder or as described in the recitals hereto to clearly justify such restrictions which, in any event (given the Executive’s education, skills and ability), the Executive does not believe would prevent the Executive from otherwise earning a living. The Executive agrees that the Restrictive Covenants do not confer a benefit upon the Company disproportionate to the detriment of the Executive.
| 6.8 | Enforcement. The Executive agrees that the Executive’s services are unique and that the Executive has access to Confidential Information. Accordingly, without limiting the generality of Section 17, the Executive agrees that a breach by the Executive of any of the covenants in this Section 6 would cause immediate and irreparable harm to the Company that would be difficult or impossible to measure, and that damages to the Company for any such injury would therefore be an inadequate remedy for any such breach. Therefore, the Executive agrees that in the event of any breach or threatened breach of any provision of this Section 6, the Company shall be entitled, in addition to and without limitation upon all other remedies the Company may have under this Agreement, at law or otherwise, to obtain specific performance, injunctive relief and/or other appropriate relief (without posting any bond or deposit) in order to enforce or prevent any violations of the provisions of this Section 6. |
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| 7. | Withholding Taxes. Notwithstanding anything else herein to the contrary, the Company may withhold (or cause there to be withheld, as the case may be) from any amounts otherwise due or payable under or pursuant to this Agreement such federal, state and local income, employment, or other taxes as may be required to be withheld pursuant to any applicable law or regulation. Except for such withholding rights, the Executive is solely responsible for any and all tax liability that may arise with respect to the compensation provided under or pursuant to this Agreement. |
| 8. | Successors and Assigns. |
(a) This Agreement is personal to the Executive and without the prior written consent of the Company shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives.
(b) This Agreement shall inure to the benefit of and be binding upon the Company, Parent, and their respective successors and assigns, and each of Company and Parent shall be liable for the payment of benefits hereunder. Without limiting the generality of the preceding sentence, the Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor or assignee, as applicable, which assumes and agrees to perform this Agreement by operation of law or otherwise.
| 9. | Number and Gender; Examples. Where the context requires, the singular shall include the plural, the plural shall include the singular, and any gender shall include all other genders. Where specific language is used to clarify by example a general statement contained herein, such specific language shall not be deemed to modify, limit or restrict in any manner the construction of the general statement to which it relates. |
| 10. | Section Headings. The section headings of, and titles of paragraphs and subparagraphs contained in, this Agreement are for the purpose of convenience only, and they neither form a part of this Agreement nor are they to be used in the construction or interpretation thereof. |
| 11. | Governing Law. This Agreement will be governed by and construed in accordance with the laws of the state of Texas, without giving effect to any choice of law or conflicting provision or rule (whether of the state of Texas or any other jurisdiction) that would cause the laws of any jurisdiction other than the state of Texas to be applied. In furtherance of the foregoing, the internal law of the state of Texas will control the interpretation and construction of this Agreement, even if under such jurisdiction’s choice of law or conflict of law analysis, the substantive law of some other jurisdiction would ordinarily apply. |
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| 12. | Severability. It is the desire and intent of the parties hereto that the provisions of this Agreement be enforced to the fullest extent permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if any particular provision of this Agreement shall be adjudicated by a court of competent jurisdiction or determined by an arbitrator pursuant to Section 16 to be invalid, prohibited or unenforceable under any present or future law, and if the rights and obligations of any party under this Agreement will not be materially and adversely affected thereby, such provision, as to such jurisdiction, shall be ineffective, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction, and to this end the provisions of this Agreement are declared to be severable; furthermore, in lieu of such invalid or unenforceable provision there will be added automatically as a part of this Agreement, a legal, valid and enforceable provision as similar in terms to such invalid or unenforceable provision as may be possible. Notwithstanding the foregoing, if such provision could be more narrowly drawn (as to geographic scope, period of duration or otherwise) so as not to be invalid, prohibited or unenforceable in such jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction. |
| 13. | Entire Agreement. This Agreement embodies the entire agreement of the parties hereto respecting the matters within its scope. This Agreement supersedes all prior and contemporaneous agreements of the parties hereto that directly or indirectly bears upon the subject matter hereof (including, without limitation, any prior employment or similar agreements). Any prior negotiations, correspondence, agreements, proposals or understandings relating to the subject matter hereof shall be deemed to have been merged into this Agreement, and to the extent inconsistent herewith, such negotiations, correspondence, agreements, proposals, or understandings shall be deemed to be of no force or effect. There are no representations, warranties, or agreements, whether express or implied, or oral or written, with respect to the subject matter hereof, except as expressly set forth herein. |
| 14. | Modifications. This Agreement may not be amended, modified or changed (in whole or in part), except by a formal, definitive written agreement expressly referring to this Agreement, which agreement is executed by both of the parties hereto. |
| 15. | Waiver. Neither the failure nor any delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or of any right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver. |
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| 16. | Arbitration. Except as provided in Sections 6.8 and 17, in the event that there is any claim or dispute arising out of or relating to this Agreement, or the breach (or alleged breach) thereof, and the parties hereto shall not have resolved such claim or dispute within sixty (60) days after written notice from one party to the other setting forth the nature of such claim or dispute, then such claim or dispute shall be settled exclusively by binding arbitration in Dallas, Texas in accordance with the Employment Arbitration Rules of the American Arbitration Association (the “AAA Rules”) by an arbitrator mutually agreed upon by the parties hereto or, in the absence of such agreement, by an arbitrator selected according to such AAA Rules. Notwithstanding the foregoing, if either the Company or the Executive shall request, such arbitration shall be conducted by a panel of three arbitrators, one selected by the Company, one selected by the Executive and the third selected by agreement of the first two, or, in the absence of such agreement, in accordance with the AAA Rules. Neither party shall have the right to claim or recover punitive damages. Judgment upon the award rendered by such arbitrator(s) shall be entered in any court having jurisdiction thereof upon the application of either party. Except as provided in Sections 6.8 and 17, the parties acknowledge and agree that they are hereby waiving any rights to trial by jury or a court in any action or proceeding brought by either of the parties against the other in connection with any matter whatsoever arising out of or in any way connected with this Agreement or the Executive’s employment. |
| 17. | Remedies. Each of the parties to this Agreement and any Person granted rights hereunder whether or not such person or entity is a signatory hereto shall be entitled to enforce its rights under this Agreement specifically to recover damages and costs for any breach of any provision of this Agreement and to exercise all other rights existing in its favor. The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and that each party (as well as each other Person granted rights hereunder) may in its sole discretion obtain permanent injunctive or equitable relief in any arbitration filed pursuant to Section 16 and enforce any such relief awarded by the arbitrator in any court of competent jurisdiction. In addition, each party may also apply to any court of law or equity of competent jurisdiction for provisional injunctive or equitable relief, including a temporary restraining or preliminary injunction (without any requirement to post any bond or deposit), to ensure that the relief sought in arbitration is not rendered ineffectual by interim harm. Each party shall be responsible for paying its own attorneys’ fees, costs and other expenses pertaining to any such legal proceeding and enforcement regardless of whether an award or finding or any judgment or verdict thereon is entered against either party. |
| 18. | Notices. Any notice provided for in this Agreement must be in writing and must be either personally delivered, transmitted via email, mailed by first class mail (postage prepaid and return receipt requested) or sent by reputable overnight courier service (charges prepaid) to the recipient at the address below indicated or at such other address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party. Notices will be deemed to have been given hereunder and received when delivered personally, when received if sent via email, five (5) days after deposit in the U.S. mail and one (1) day after deposit with a reputable overnight courier service. |
if to the Company:
| BHR Luxury Hotels Management, LLC 14001 Dallas Parkway, Suite 1100 Dallas, TX 75240 Attention: Chief Legal Officer |
if to the Executive, to the address most recently on file in the payroll records of the Company.
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| 19. | Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original as against any party whose signature appears thereon, and all of which together shall constitute one and the same instrument. This Agreement shall become binding when one or more counterparts hereof, individually or taken together, shall bear the signatures of all of the parties reflected hereon as the signatories. Photographic copies of such signed counterparts may be used in lieu of the originals for any purpose. |
| 20. | Legal Counsel; Mutual Drafting. Each party recognizes that this is a legally binding contract and acknowledges and agrees that they have had the opportunity to consult with legal counsel of their choice. Each party has cooperated in the drafting, negotiation and preparation of this Agreement. Hence, in any construction to be made of this Agreement, the same shall not be construed against either party on the basis of that party being the drafter of such language. The Executive agrees and acknowledges that the Executive has read and understands this Agreement, is entering into it freely and voluntarily, and has been advised to seek counsel prior to entering into this Agreement and has had ample opportunity to do so. |
| 21. | Indemnification and D&O Insurance Coverage. The Company will indemnify the Executive, to the maximum extent permitted by applicable law, against all costs, charges and expenses incurred or sustained by the Executive, including the cost of legal counsel selected and retained by the Executive in connection with any action, suit or proceeding to which the Executive may be made a party by reason of the Executive being or having been an officer, director, or employee of the Company or any Affiliate. The Company’s obligations under this Section 21 shall be in addition to any other indemnification rights to which the Executive may be entitled; provided, however, that in no event shall the Executive’s indemnification rights and the rights to advancement of fees and expenses at any time be less favorable than the indemnification rights and rights to advancement of fees and expenses generally available to officers or directors of the Company or its Affiliates. During and for a period equal to the relevant statute of limitations following the Period of Employment, the Executive shall be entitled to director and officer insurance coverage for his acts and omissions while an officer of the Company (or any of its Affiliates, as applicable) on a basis no less favorable to the Executive than the coverage provided other similarly situated executives or directors of the Company or its Affiliates. |
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| 22. | Full Settlement. The Company’s obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action which the Company may have against the Executive or others. The Company agrees to pay as incurred (within thirty (30) days following the Company’s receipt of an invoice from the Executive), to the full extent permitted by law, all reasonable legal fees and expenses which the Executive or his beneficiaries may reasonably incur as a result of any contest (regardless of the outcome thereof) by the Company, the Executive or others of the validity or enforceability of, or liability under, any provision of this Agreement or any guarantee of performance thereof (including as a result of any contest by the Executive or his beneficiaries about the amount of any payment pursuant to this Agreement), plus in each case interest on any delayed payment at the applicable Federal rate provided for in Section 7872(f)(2)(a) of the Code to the extent permitted by Code Section 409A. The preceding sentence shall not apply with respect to any such contest if the court having jurisdiction over such contest makes a final determination that the Executive’s claim in such contest is frivolous or maintained in bad faith. This reimbursement obligation shall remain in effect following the Executive’s termination of employment for the applicable statute of limitations period relating to any such claim. |
| 23. | Clawback Policy. All compensation payable under this Agreement is subject to the terms of the Company’s recoupment, clawback or similar policy as it may be in effect from time to time, as well as any similar provisions of applicable law. |
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IN WITNESS WHEREOF, the Company and the Executive have executed this Agreement as of the date hereof.
| “COMPANY” | |||
| BHR LUXURY HOTELS MANAGEMENT, LLC, | |||
| a Texas limited liability company | |||
| By: | Braemar Hospitality Limited Partnership, a Delaware limited partnership | ||
| Sole Member | |||
| By: | Braemar OP General Partner LLC, | ||
| a Delaware limited liability company | |||
| General Partner | |||
| By: | /s/ Richard J. Stockton | ||
| Richard J. Stockton | |||
| President & CEO | |||
| “PARENT” | ||
| BRAEMAR HOTELS & RESORTS INC. | ||
| a Maryland corporation | ||
| By: | /s/ Richard J. Stockton | |
| Richard J. Stockton | ||
| President & CEO | ||
| “EXECUTIVE” | |
| /s/ Justin R. Coe | |
| Justin R. Coe |
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EXHIBIT A
RELEASE AND WAIVER
THIS RELEASE AND WAIVER (this "Termination Release") is made and entered into as of the / / day of / /, 20/ / by and among Justin R. Coe (the "Executive"), BHR Luxury Hotels Management, LLC, a Texas limited liability company (the "Company"), and Braemar Hotels & Resorts Inc., a Maryland corporation (the "Parent").
WHEREAS, the Company, the Parent and the Executive entered into an Employment Agreement (the “Agreement”), effective as of November 10, 2026, which provides for payment of the Severance Benefits (as defined below) upon the Executive’s termination of employment in certain circumstances;
WHEREAS, the Executive has agreed, pursuant to the terms of the Agreement, to execute and, if applicable, not revoke, a release and waiver in the form set forth in this Termination Release in consideration of the Company’s agreement to provide the Severance Benefits;
WHEREAS, capitalized terms not defined herein shall have the meanings set forth in the Agreement; and
WHEREAS, the Company, the Parent and the Executive desire to settle all rights, duties and obligations between them, including without limitation all such rights, duties, and obligations arising under the Agreement or otherwise out of the Executive’s employment by the Company.
NOW THEREFORE, intending to be legally bound and for good and valid consideration the sufficiency of which is hereby acknowledged, the Executive agrees as follows:
| 1. | QUALIFYING TERMINATION PAYMENTS AND CONDITIONS. The Executive and the Company acknowledge and agree that the Severance Date is [_____], 20[_], and that Executive’s employment with the Company and any Affiliates is terminated as of the Severance Date. The Executive, the Company and the Parent agree that Executive is entitled to the compensation [and benefits] set forth in Section [_]1 of the Agreement (the “Severance Benefits”). Pursuant to Section 5.4 of Agreement, payment of the Severance Benefits is subject to the Executive’s execution and, if applicable, non-revocation of this Termination Release and is due pursuant to the terms described in the Agreement. If a revocation period is required by applicable law, no payment pursuant to Section 5.3 of the Agreement will be due sooner than eight (8) days following the date that Executive executes this Termination Release. |
1 Note to Draft: To be finalized dependent on qualifying termination reason.
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| 2. | GENERAL RELEASE BY EXECUTIVE. |
| a. | Except as set forth in Section 2(b) below, the Executive knowingly and voluntarily releases, acquits, covenants not to sue and forever discharges the Company, its Affiliates, and any of their respective past and present owners, parents, stockholders, predecessors, successors, assigns, agents, directors, officers, employees, representatives, divisions and subsidiaries (collectively, the “Releasees”) from any and all charges, complaints, claims, liabilities, obligations, promises, agreements, damages, causes of action, suits, rights, costs, losses, debts and expenses of any nature whatsoever, known or unknown, suspected or unsuspected, foreseen or unforeseen, matured or unmatured (collectively, the “Claims”), against them which the Executive or any of his heirs, executors, administrators, successors and assigns ever had, now has or at any time hereafter may have, own or hold by reason of any matter, fact, or cause whatsoever from the beginning of time up to and including the date of this Termination Release, including without limitation all claims for breach of implied or express contract, wrongful discharge, discrimination, retaliation, all tort claims, including unjust enrichment, quantum meruit, negligence, defamation, fraud, all claims for damages, interests, court costs, fees and expenses, all claims for punitive or exemplary damages, and all claims for attorneys’ fees, whether now known or unknown. This release of claims expressly includes all claims arising under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act of 1967, as amended, the Americans with Disabilities Act of 1990, the Family and Medical Leave Act of 1993, the Employee Retirement Income Security Act of 1974, Chapters 21 and 451 of the Texas Labor Code, each as amended, and any other federal, state or local laws, rules, regulations, judicial decisions or public policies now or hereafter recognized. Expressly excluded from this Termination Release are Claims which cannot be waived by law. |
| b. | The Executive represents that he has not filed or permitted to be filed against any of the Releasees, any complaints, charges or lawsuits and covenants and agrees that he will not seek or be entitled to any personal recovery in any court or before any governmental agency, arbitrator or self-regulatory body against any of the Releasees arising out of any matters set forth in Section 2(a) hereof. Nothing herein shall prevent the Executive from seeking to enforce his rights under the Agreement, including without limitation, the Executive’s right to receive his Accrued Obligations, Severance Payment, Pro-Rata Bonus and Other Benefits, in each case, at the time specified in the Agreement. The Executive does not hereby waive or release his rights to any benefits under the Company’s employee benefit plans to which he is or will be entitled pursuant to the terms of such plans in the ordinary course. In addition, nothing herein releases or otherwise waives any rights to the Executive’s: (i) final paycheck; (ii) reimbursement of any outstanding business expense amounts (in accordance with the Agreement and the Company’s business expense reimbursement policies); and (iii) applicable Consolidated Omnibus Budget Reconciliation Act or similar state law benefits under the Company’s standard benefit programs, if any. |
| c. | The Executive recognizes and understands that this Termination Release does not prohibit the Executive from filing an administrative charge with any state or federal agency, including the Equal Employment Opportunity Commission (“EEOC”). The Executive further recognizes and understands that even if the Executive files a charge with an administrative agency, or one is filed on the Executive’s behalf, the Executive waives any right to any relief of any kind should the administrative agency pursue a claim on Employee’s behalf. Notwithstanding any other provision of this Termination Release, the Executive further understands and agrees that: (a) the Executive is not in any way prohibited from reporting information to, or participating in any investigation or proceeding conducted by, the EEOC, the Securities and Exchange Commission (“SEC”) or any other federal, state, or local governmental agency or entity; (b) the Executive is not in any way precluded from providing truthful testimony in response to a valid subpoena, court order, or regulatory request; and (c) nothing in this Termination Release limits the Executive’s right to receive an award for information provided to the SEC. |
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| 3. | ADEA RELEASE BY EXECUTIVE. The Executive hereby completely and forever releases and irrevocably discharges the Releasees, from any and all Claims arising under the Age Discrimination in Employment Act, as amended (“ADEA”) on or before the date the Executive signs this Termination Release (the “ADEA Release”), and hereby acknowledges and agrees that: (i) this Termination Release, including the ADEA Release, was negotiated at arm’s length and the Executive has had the opportunity to confer with counsel of his choosing regarding this Termination Release; (ii) this Termination Release, including the ADEA Release, is worded in a manner that the Executive fully understands; (iii) the Executive specifically waives any rights or claims under the ADEA; (iv) the Executive knowingly and voluntarily agrees to all of the terms set forth in this Termination Release, including the ADEA Release; (v) the Executive acknowledges and understands that any claims under the ADEA that may arise after the date of this Termination Release are not waived; and (vi) the rights and claims waived in this Termination Release, including the ADEA Release, are in exchange for consideration over and above anything to which the Executive was already entitled. |
| 4. | GENERAL RELEASE BY COMPANY. The Company and its Affiliates each do hereby fully, finally and completely release Executive from any and all Claims of any kind or nature arising out of the Executive’s employment with the Company arising from, relating to, or in any way connected with any facts or events occurring on or before the date of this Termination Release; provided, however, that the Executive is not released or discharged from: (i) any Claim arising out of the Executive’s fraudulent, willful, or grossly negligent act or omission; or (ii) his continuing obligations contained in this Termination Release, the Agreement, or in any other agreement with the Company. |
| 5. | REAFFIRMATION OF CONTINUING OBLIGATIONS. Nothing in this Termination Release shall be deemed to affect or relieve the Executive from any continuing obligation contained in any other agreement with the Company or the Company’s rights with respect thereto. The Executive specifically acknowledges and reaffirms the post-termination obligations set forth in Section 6 of the Agreement, including continuing confidentiality, non-disclosure, non-disparagement, non-competition and non-solicitation obligations to the Company under the Agreement (collectively, the “Continuing Obligations”). The Executive further acknowledges that this reaffirmation is material to this Termination Release, and the Executive acknowledges and agrees that the Continuing Obligations are reasonable and enforceable and that he will not challenge or violate these covenants. |
| 6. | ARBITRATION. The Executive understands and agrees that the arbitration requirements set forth in Section 16 of the Agreement remain in full force and effect following the Severance Date and the execution of this Termination Release. Any claims arising out of or under this Termination Release or related to this Termination Release are subject to arbitration pursuant to Section 16 of the Agreement. |
| 7. | MODIFICATION; WAIVER. No modification or addition hereto or waiver or cancellation of any provision hereof shall be valid except by a writing signed by the party to be charged therewith. No delay on the part of any party to this Termination Release in exercising any right or privilege provided hereunder or by law shall impair, prejudice or constitute a waiver of such right or privilege. |
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| 8. | SEVERABILITY. If any provision contained in this Termination Release is determined to be void, illegal or unenforceable, in whole or in part, then the other provisions contained herein shall remain in full force and effect as if the provision which was determined to be void, illegal or unenforceable had not been contained herein. |
| 9. | COSTS. The parties hereto agree that each party shall pay its respective costs, including attorney’s fees, if any, associated with the negotiation, execution and delivery of this Termination Release. |
| 10. | FULLY UNDERSTOOD; PAYMENTS RECEIVED. By signing this Termination Release, the Executive acknowledges and affirms that he has read and understands the foregoing Termination Release, agrees to the terms of this Termination Release, and acknowledges receipt of a copy of this Termination Release. The Executive also hereby acknowledges and affirms the sufficiency of the compensation and severance amounts set forth in the Agreement. The Executive further acknowledges that upon receipt of the compensation and severance amounts set forth in the Agreement, he shall not be entitled to any further payment, compensation or remuneration of any kind from the Company, with respect to the Executive’s employment with the Company. |
| 11. | ENTIRE AGREEMENT. This Termination Release contains the entire agreement between the Executive, the Company and the Parent and supersedes any and all prior understandings or agreements with respect to the subject matter hereof, whether written or oral, except as set forth herein and with respect to any of the Executive’s continuing obligations contained in the Agreement, which shall continue and remain in full force and effect per the terms of those covenants. |
| 12. | ACKNOWLEDGMENT. The Company has advised the Executive to consult with an attorney of his choosing prior to signing this Termination Release and the Executive hereby represents to the Company that he has been offered an opportunity to consult with an attorney prior to signing this Termination Release. The Company has also advised the Executive that Executive has up to [twenty-one (21) days] [forty-five (45) days] to consider and sign the Termination Release and up to seven (7) days after signing in which to revoke acceptance by giving notice to [__________] at [__________________] by personal delivery or by mail postmarked no later than the seventh (7th) day after the Executive signs the Termination Release. The Executive acknowledges and agrees that any changes in the terms of this Termination Release, whether material or immaterial, after the date upon which the Executive first received this Termination Release shall not affect or restart the above-referenced [twenty-one (21)-day] [forty-five (45)-day] consideration period. |
[Signature Page Follows]
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IN WITNESS WHEREOF, and intending to be legally bound hereby, the parties hereto have executed this Termination Release under seal as of the day and year first above written.
| “COMPANY” | |||
| BHR LUXURY HOTELS MANAGEMENT, LLC, | |||
| a Texas limited liability company | |||
| By: | Braemar Hospitality Limited Partnership, a Delaware limited partnership | ||
| Sole Member | |||
| By: | Braemar OP General Partner LLC, | ||
| a Delaware limited liability company | |||
| General Partner | |||
| By: | |||
| Name: | |||
| Title: | |||
| “PARENT” | ||
| BRAEMAR HOTELS & RESORTS INC. | ||
| a Maryland corporation | ||
| By: | ||
| Name: | ||
| Title: | ||
| “EXECUTIVE” | |
| Justin R. Coe |
A-5
Exhibit 10.5
SEPARATION AGREEMENT
(Age 40 and over)
This Separation Agreement (this “Agreement”) is entered into by Ashford Hospitality Advisors LLC, a Delaware limited liability company (the “Company”), a wholly-owned subsidiary of Ashford Inc., a Nevada corporation (“AINC” and, together with the Company and all of AINC’s other subsidiaries and affiliates, the “Ashford Entities”), and Justin Coe (the “Employee”). The Company and Employee are sometimes referred to collectively in this Agreement as the “Parties” and individually as a “Party.”
Recitals
WHEREAS, Employee’s employment with the Company will permanently end on November 10, 2026 (the “Separation Date”); and
WHEREAS, to assist Employee’s transition to other employment, the Parties mutually desire to enter into this Agreement to set forth the Company’s offer and Employee’s acceptance of certain benefits in exchange for and conditioned on Employee’s timely execution and return of this Agreement, and Employee’s post-separation obligations set forth below; and
WHEREAS, this Agreement is not being entered into in connection with or in settlement of any claims of alleged discrimination, retaliation, or harassment.
NOW, THEREFORE, in consideration of the mutual promises and undertakings set out below, the sufficiency of which is acknowledged by their signatures below, and intending to be legally bound, the Parties agree as follows:
Agreement
1. Separation from Employment and Related Matters.
(a) Separation from Employment. Employee’s employment with the Company and status as a service provider to any of the other Ashford Entities and any entities advised by any of the Ashford Entities and any such advised entities’ affiliates, including without limitation Ashford Hospitality Trust, Inc. (“AHT”) and Braemar Hotels & Resorts Inc. (“BHR”) (together with the Ashford Entities, the “Ashford-Related Entities”), will permanently end on November 10, 2026 (the “Separation Date”).
(b) Final Pay; Effect on Benefit Plans. Employee will receive his/her base salary through the Separation Date at the time required by applicable law. Nothing in this Agreement affects Employee’s accrued and vested benefits under applicable employee benefit plans, or Employee’s right to continue or convert coverage under certain employee benefit plans, including the Company’s group health plan pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985 (known as COBRA), at his/her cost and in accordance with the terms of those plans and applicable law.
(c) No Further Obligations. By his/her signature below, Employee acknowledges and agrees that upon receiving his/her final paycheck, he/she will have received all the compensation, benefits and paid or unpaid leave to which he/she is entitled, and that, except as provided in Section 2 below, he/she will not be entitled to and will not receive any additional compensation (including any bonus), benefits, paid or unpaid leave from any of the Ashford-Related Entities.
SEPARATION AGREEMENT – Page 1
2. Separation Benefit. In consideration of the General Release in Section 3 and the other promises and undertakings of Employee set out in this Agreement, and contingent on Employee’s full performance of those promises and undertakings, the Company will pay (or cause to be paid) to Employee the following separation benefit (the “Separation Benefit”): (i) $1,500.00 and (ii) an amount in cash equal to all unpaid deferred cash awards granted to Employee by AHT and BHR that have not vested as of the Separation Date, if any (the “Unvested Awards”). The Separation Benefit, less legally required withholdings and deductions, will be paid to Employee by direct deposit or check mailed to Employee’s last address on file with the Company in one lump sum on the Company’s first payroll date that is at least five (5) business days after the Effective Date, but in any event no earlier than November 15, 2026 (defined in Section 10 below). Employee acknowledges and agrees that, upon payment of the Separation Benefit, any and all rights Employee has in the Unvested Awards shall terminate.
3. General Release and Covenant Not to Sue by Employee.
(a) In consideration of the Separation Benefit and the other promises and undertakings of the Company set out in this Agreement, and subject to Section 4 below, Employee (for him/herself and anyone claiming through him/her) voluntarily, completely, and unconditionally releases, waives, and forever discharges to the maximum extent permitted by law the Released Parties (defined below) from any and all claims, demands, liabilities, obligations, and causes of action of whatever kind or character, whether vicarious, derivative, or direct, and whether known or unknown (collectively, the “Claims”), that he/she now may have or ever has had in any capacity, individually, or as a member of a class, collective, or representative action, against any of the Released Parties, including any right to initiate or participate in any class or collective action with respect to any Claims that are released by this Agreement, and to the maximum extent permitted by law, covenants not to sue or to file or cause to be filed any legal action in any court with the respect to the Claims.
(b) The Claims released and waived by this Agreement include without limitation any and all Claims (including for attorneys’ fees): (i) growing out of, resulting from, or connected in any way with Employee’s employment, the ending of his/her employment, or the employment practices of any of the Released Parties; (ii) based on any policy of any of the Ashford-Related Entities, written agreement between Employee and any of the Released Parties, or promise or representation concerning any aspect of the employment relationship or ending of that relationship; (iii) based on any bonus, equity, or other incentive plan or program of any of the Ashford-Related Entities; (iv) based on the common law, such as Claims based on contract or in tort (including for fraudulent inducement), or on any federal, state, or local statutory or constitutional provision that applies or is asserted to apply, directly or indirectly, to his/her employment, the ending of employment, or the employment practices of any of the Released Parties; (v) Claims under any labor or employment practices, employment discrimination, or fair employment practices statute (including without limitation under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 1981, the Age Discrimination in Employment Act (the “ADEA”), the Americans with Disabilities Act, the Family and Medical Leave Act, the Pregnant Workers Fairness Act, the Genetic Information Non-Discrimination Act, the Equal Pay Act, the Fair Labor Standards Act (to the extent permissible by law), the Fair Credit Reporting Act, and the Worker Adjustment and Retraining Notification Act, and state-law counterparts); (vi) for severance pay or benefits not expressly provided for in Section 2 above or additional compensation, paid or unpaid leave of any kind, or payment for accrued but unused paid leave; and (vii) based on any other act, conduct, or omission of any of the Released Parties.
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(c) The “Released Parties” are: (i) the Company; (ii) AINC; (iii) all the other Ashford-Related Entities; (iv) any parent, subsidiary, or affiliate of the entities named or described in clauses (i)-(iii); (v) any predecessor, successor, or assign of the entities named or described clauses (i)-(iv); and (vi) any current or former, officer, director, partner, shareholder, owner, member, manager, joint venturer, trustee, fiduciary, agent, employee, associate, representative, administrator, employee benefit plan sponsored or maintained by, insurer, or attorney of or for the entities and persons named or described in clauses (i)-(v), in any capacity.
4. Exceptions to the General Release and Covenant Not to Sue by Employee; Permitted Activities.
(a) Nothing in this Agreement (including the General Release and Covenant Not to Sue by Employee in Section 3 above and the Confidential Information; Return of Property in Section 6) or any other agreement between Employee and any of the Ashford-Related Entities is intended to or does: (i) waive or release any Claims under the ADEA that may arise after the date Employee signs this Agreement; (ii) waive or release Employee’s right to receive the Separation Benefit or to enforce the terms of this Agreement; (iii) waive or release any right of the Employee to challenge the enforceability of this Agreement if permitted by law; (iv) waive or release any administrative Claims for unemployment compensation or workers’ compensation benefits; (v) waive or release any Claims or rights that cannot by law be released, such as any right to receive an award or “bounty” for information provided to any governmental agency in connection with any protected whistleblowing activity; (vi) prevent Employee from contacting, reporting to, communicating with, responding truthfully to an inquiry from, providing truthful information to, filing a charge or complaint with, cooperating with, making truthful statements under oath in connection with, or otherwise testifying or participating in any investigation, hearing, or other proceeding conducted by or before any federal or state law enforcement, governmental, or regulatory agency or body (such as the U.S. Department of Justice, the Securities and Exchange Commission, the Occupational Safety and Health Administration, the Equal Employment Opportunity Commission, the U.S. Department of Labor, the National Labor Relations Board, the Occupational Safety and Health Commission, the Texas Workforce Commission-Civil Rights Division, another federal or state law enforcement, governmental, regulatory, or fair employment practices agency) regarding possible or alleged violations of law or unlawful acts in the workplace, including discrimination retaliation, or harassment, or pursuant to applicable whistleblower statutes, and doing so in each instance without prior notice to or authorization from the Company or any of the other Ashford-Related Entities; (vii) assisting another in taking any of the actions in clause (vi); (viii) engaging in any other legally protected or concerted activities, including discussing terms, conditions, or benefits of employment with others for the mutual aid or protection of employees; or (ix) making truthful statements or disclosures that are required by applicable law, regulation, or legal process.
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(b) Employee acknowledges and agrees, however, that by signing this Agreement, he/she is forever waiving any right to recover, and will not request or accept, anything of value directly from any of the Released Parties as compensation, damages, or other individual legal relief growing out of, resulting from, or connected in any way with the Claims being released in the General Release in Section 3 above, other than the Separation Benefit, whether sought directly by him/her or by any administrative agency or other public authority, individual, or group of individuals on his/her behalf. The foregoing does not prevent Employee from accepting an award or “bounty” from any governmental agency in connection with protected whistleblowing activity.
5. Limited Release of Employee and Covenant Not to Sue.
(a) In consideration of the General Release and Covenant Not to Sue by Employee in Section 3 above and his/her other promises and undertakings set out in this Agreement, the Company (on behalf of itself and AINC) voluntarily, completely, and unconditionally releases, waives, and forever discharges Employee from any and all Claims that it now may have or ever has had against Employee (including for attorneys’ fees) growing out of, resulting from, or in any way associated with Employee’s employment, or the ending of his/her employment, with the Company excepting, however, any claims for fraud, embezzlement, theft, or other illegal acts, and covenants and agrees not to sue or to file or cause to be filed any legal action in any court with respect to the Claims so released.
(b) Exceptions to Limited Release of Employee and Covenant Not to Sue; Permitted Activities. Nothing in this Agreement is intended to or does: (i) waive or release the Released Parties’ right to enforce this Agreement or any other agreement between the Parties; (ii) prevent the Released Parties from contacting, reporting to, communicating with, responding truthfully to an inquiry from, providing truthful information to, cooperating with, making truthful statements under oath, or otherwise testifying or participating in any investigation, hearing, or other proceeding being conducted by or before any federal or state law enforcement, governmental, or regulatory agency or body; or (iii) prevent the Released Parties from making truthful statements or disclosures that are required by applicable law, regulation, or legal process.
6. Confidential Information; Return of Property.
(a) Acknowledgements Regarding Confidential Information. Employee acknowledges and agrees that: (i) the Ashford-Related Entities are engaged in a highly competitive business; (ii) the Ashford-Related Entities have expended considerable time and resources to develop goodwill with their employees, customers, vendors, and others, and to create, protect, and exploit their Confidential Information (defined below); (iii) the Ashford-Related Entities must continue to prevent the dilution of their goodwill and unauthorized use or disclosure of their Confidential Information to avoid irreparable harm to their legitimate business interests; and (iv) by virtue of his/her position, Employee had access to Confidential Information, the disclosure or unauthorized use of which would irreparably harm the Ashford-Related Entities’ competitive position in the marketplace and dilute their goodwill.
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(b) Agreements and Representations Regarding Confidential Information. Accordingly, subject to Section 4(a) above, Employee agrees: (i) that all Confidential Information and Property (defined below) shall remain the sole and exclusive property of the Ashford-Related Entities; (ii) to protect and safeguard all Confidential Information; (iii) to hold all Confidential Information in strictest confidence and to not, directly or indirectly, use any such Confidential Information for his/her own or a third-party’s advantage, benefit, or gain; (iv) unless he/she is authorized to do so by an officer, director, or legal counsel for the Company or AINC, not to disclose or divulge any such Confidential Information to any person other than an officer, director, or employee of, or legal counsel for, the Company or AINC; (v) if Employee believes he/she is compelled by law or legal process to disclose or divulge any Confidential Information, to notify the General Counsel of AINC sufficiently in advance of any such disclosure to allow the Ashford-Related Entities the opportunity to defend, limit, or otherwise protect their interests against such disclosure; (vi) not to recreate or attempt to recreate the Confidential Information; and (vii) not to ask, direct, or authorize another to take any action that would be prohibited by this subsection if undertaken by Employee. Employee represents that he/she has not removed, copied, destroyed, defaced, damaged, or deleted any Confidential Information other than in the proper performance of his/her duties as an employee; he/she has not exported any Confidential Information to, or copied, placed, or saved any Confidential Information on, any computer or electronic storage system (such as a USB thumb drive or other external storage device) other than in the proper performance of his/her duties as an employee; and he/she has not forwarded any Confidential Information to a personal email address. The foregoing does not apply to any Confidential Information of BHR used by Employee solely in connection with, and in furtherance of, Employee’s employment with BHR or any of its affiliates.
(c) Return of Property. Employee represents that he/she has returned (or has made arrangements with the Company to return) to Company Human Resources all property belonging to any Ashford-Related Entity, except for items approved in writing by the Company, in good and working condition, including without limitation: (i) physical property such as computers, monitors, printers and related equipment and identification or access card(s) or badge(s); (ii) access codes or passwords to or necessary to access any Company-provided computer, external hard drive or storage device, any Company documents, and any Ashford-Related Entity’s information or security systems; (iii) physical or electronic documents (and all copies thereof) that contain or include information about any Ashford-Related Entity’s business and operations (including without limitation the Confidential Information as defined below); and (iv) any other physical or electronic documents (and all copies thereof) that he/she received from or sent to any employee of any Ashford-Related Entity, or that he/she otherwise had access to during his/her employment (other than copies of personnel, benefit, or payroll documents concerning only him/her) (collectively, the “Property”). Employee agrees that if he/she later discovers some Property that he/she has not returned, he/she will contact Company Human Resources as soon as possible to make arrangements to return it.
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(d) “Confidential Information” for purposes of this Agreement means: (i) all material nonpublic information about any of the Ashford-Related Entities or any of the other Released Parties; (ii) any “trade secret,” as defined by federal and applicable state law, of any of the Ashford-Related Entities or any of the other Released Parties; and (iii) all other confidential or proprietary information or trade secrets of or relating to any of the Ashford-Related Entities or any of the other Released Parties and their current, past, future, or prospective owners, investors, business partners, customers, vendors, capital providers, investments, financings, and suppliers, or otherwise provided to any of the Ashford-Related Entities under an obligation or expectation of confidential treatment. “Confidential Information” includes without limitation all documents or information (in whatever form or medium, and all copies thereof whether or not the original was deleted or destroyed) conceived, originated, discovered, or developed in whole or in part by Employee, otherwise disclosed to or obtained by Employee, or to which Employee had access and that concerns or evidences operations; processes; products; business practices; finances; strategies; modes of doing business; performance; development, acquisition, or divestment plans; any proposed business transactions; officers, directors, or shareholders; current or potential investors, capital providers, business partners, customers, vendors, and suppliers; marketing methods; costs; prices; contractual relationships; legal or regulatory status; and Personnel Information. “Personnel Information” for purposes of this Agreement means confidential or personal, personally identifiable information about any current or former employees of any Ashford-Related Entity (such as medical, performance, or disciplinary history, financial, or banking records or information, and non-public contact information); Social Security numbers; compilations of personnel data (such as compensation, payroll, or benefits information, or that otherwise contains personally identifiable information); and performance and capabilities of employees, except as such information pertains solely to Employee. Notwithstanding the foregoing, “Confidential Information” does not mean any information of BHR used by Employee solely in connection with, and in furtherance of, Employee’s employment with BHR or any of its affiliates.
7. Other Representations, Promises, and Undertakings of Employee.
(a) Assistance and Cooperation. Employee agrees to provide such assistance as may be reasonably requested by the Company relating to matters in which he/she was involved or had responsibility while employed at the sole cost and expense of the Company or other applicable Ashford Entity. Employee further agrees to cooperate with any of the Ashford Entities, at their request, in all contemplated, pending, and future litigation, regulatory actions, investigations, arbitrations, and/or other fact-finding or adjudicative proceedings, public or private, involving matters for which Employee had some responsibility while employed or about which he otherwise had personal knowledge. This obligation includes meeting with the applicable Ashford Entities or their representatives or attorneys at reasonable times at their request, and providing sworn testimony and statements that are truthful, accurate, and complete. The Company or the other applicable Ashford Entity will reimburse Employee upon submission of substantiating documentation for actual and reasonable out-of-pocket expenses incurred by him/her in fulfilling his/her obligations under this subsection (such as travel or parking expense).
(b) No Violations. As a material inducement for the Company to enter into this Agreement, Employee represents that: (i) he/she has not committed any act which is in violation of any federal or state law or regulation or the Company’s or any of the other Ashford-Related Entities’ personnel or conduct and ethics policies or which constitutes a breach of fiduciary duty; (ii) he/she has no current, actual knowledge (without any duty to investigate) that any of the Ashford-Related Entities (or their officers, directors or employees) have committed any act which is in violation of any federal or state law or regulation or the Company’s or any of the other Ashford-Related Entities’ personnel or conduct and ethics policies, which constitutes a breach of fiduciary duty, or have acted in a manner which requires corrective action of any kind that has not already been taken; and (iii) he/she has not informed any of the Ashford-Related Entities of, and he/she has no current, actual knowledge (without any duty to investigate) of, any violations of any federal or state law or regulation or the Company’s or any of the other Ashford-Related Entities’ personnel or conduct and ethics policies or breach of fiduciary duty.
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Confidentiality. Subject to Section 4(a) above, Employee agrees to keep confidential and not to disclose (or authorize another to disclose) the existence or terms of this Agreement, except that the foregoing obligation does not include disclosures: (i) to his/her immediate family members, attorney, or tax or financial advisors, if any, provided any such disclosures are made in a confidential manner or setting and limited to the purpose of the disclosure; (ii) to a governmental agency if requested in connection with an investigation or otherwise in the exercise of Employee’s rights under Section 4(a) above; (iii) if compelled by law or valid judicial process; or (iv) as necessary in any legal proceeding to enforce this Agreement.
8. Non-Disparagement Obligations of the Parties.
(a) Subject to Section 4(a) above, Employee agrees not to make, or authorize another to make, any statement (oral, written, or electronic) to the media, on social media, or to any “third party” which directly or indirectly impugns the integrity, skills, competence, business, operations, management, prospects, or personnel affairs of any of the Released Parties. “Third party” for purposes of this subsection does not include statements made: (x) to or between Employee and his/her immediate family members, attorney, or tax or financial advisors, if any, in a confidential manner or setting, if such persons have agreed to keep such information confidential; (y) in the exercise of Employee’s rights under Section 4(a) above; or (z) as necessary in any legal proceeding to enforce this Agreement.
(b) Subject to Section 5(b) above, the Company (on behalf of itself and AINC) agrees that it will not authorize the making of any statement (oral, written, or electronic) to the·media, on social media, or to any “third party” which directly or indirectly impugns the integrity, shills, or competence of Employee. “Third party” for purposes of this subsection does not include statements made (w) made to or between any of the Ashford Entities or any of their personnel; (x) to or between any of the Ashford Entities’ attorneys, accountants, tax or financial, advisors, insurers, or auditors; (y) in the exercise of it or their rights under Section 5(b) above; (z) otherwise made for legitimate business-related purposes (such as may be necessary for the implementation of this Agreement or in connection with a legal filing or business transaction); or (aa) as necessary in any legal proceeding to enforce this Agreement.
9. Time for Review; Acceptance; Effective Date; Right to Revoke. Employee may accept this Agreement by signing below and returning the signed copy to the attention of Nicole Shanks, Chief Human Resources Officer at 14185 Dallas Parkway, Suite 1150, Dallas, Texas 75254 or to NicoleShanks@RemingtonHotels.com, no later than the close of business on the 45th day after he/she first received the Agreement and the OWBPA Chart. The Agreement will become effective and enforceable eight days after he/she signs and returns it (the “Effective Date”). At any time before the Effective Date, Employee may revoke his/her acceptance of the Agreement by sending written notice of revocation to the attention of Nicole Shanks, Chief Human Resources Officer at 14185 Dallas Parkway, Suite 1150, Dallas, Texas 75254 or to NicoleShanks@RemingtonHotels.com. If Employee does timely revoke his/her acceptance, he will not be entitled to and will not receive the Separation Benefit.
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10. Acknowledgments. By signing this Agreement, Employee acknowledges and agrees that: (i) he/she has read this Agreement and the OWBPA Chart; (ii) he/she is hereby advised to consult an attorney about the meaning and effect of this Agreement; (iii) he/she has had sufficient time to consider this Agreement and to consult an attorney if he/she wished to do so; (iv) he/she fully understands the meaning and effect of signing this Agreement; (v) he/she is not relying on any written or oral statement or promise from any of the Released Parties that is not set out in this Agreement, but instead is relying on his/her own judgment in consultation with his/her attorney, if any. This Agreement (or the offering or accepting of it) does not in any manner constitute an admission of liability or wrongdoing by Employee or any of the Ashford-Related Entities, and except to the extent necessary to enforce this Agreement, neither this Agreement nor any part of it may be construed as, used, or admitted into evidence in any judicial, administrative, or arbitral proceeding, as an admission of any kind.
11. Entire Agreement; Choice of Law; Jurisdiction and Venue; Jury-Trial Waiver. The Parties agree that: (i) this Agreement contains and constitutes the entire understanding and agreement between Employee and the Released Parties relating to his/her separation from employment, and supersedes all other agreements and understandings between him/herself and any of the Released Parties related to their employment by the Company and separation therefrom; (ii) this Agreement shall be construed and enforced in accordance with, and is governed by the laws of the State of Texas, without reference to any choice of law principles that would require the application of the law of another jurisdiction; (iii) this Agreement has been negotiated by the Parties; (iv) this Agreement is to be construed as a whole, according to its fair meaning, and not strictly for or against Employee or the Company or the other Released Parties; (v) each will submit and consent to the exclusive jurisdiction, including removal jurisdiction, of the state and federal courts located in Dallas County, Texas for any action or proceeding relating to this Agreement, Employee’s employment by the Company, or the ending of his/her employment; (vi) each hereby waives any objection to such venue; and (vii) the Company (on behalf of itself and the other Ashford-Related Entities and Released Parties) and Employee irrevocably waive the right to trial by jury and agree not to ask for a jury in any such proceeding.
12. Miscellaneous.
(a) Non-Assignment. Employee acknowledges and agrees that: (i) he/she has no right to assign or otherwise transfer this Agreement or any of his/her rights or obligations under this Agreement; (ii) he/she has no right to pledge, hypothecate, anticipate, or in any way create a lien upon any payments or other benefits provided under this Agreement; and (iii) no amounts payable under this Agreement shall be assignable in anticipation of payment either by voluntary or involuntary acts, or by operation of law, except by will or pursuant to the laws of descent and distribution.
(b) Binding Effect; Third-Party Beneficiaries. This Agreement is binding upon the Parties and their successors and assigns, and shall inure to the benefit of the Parties and their successors and assigns. The Released Parties are intended third-party beneficiaries of this Agreement.
(c) Severability. If any provision (or portion thereof) of this Agreement is held by a court of competent jurisdiction to be invalid or unenforceable: (i) then such provision (or portion thereof) shall be considered separate, distinct, and severable from the remaining provisions of this Agreement, and shall not affect the validity or enforceability of such other provisions; and (ii) such invalid or unenforceable provision (or portion thereof) may be made to be enforceable by limitation, then such provision (or portion thereof) shall be enforceable to the maximum extent permitted by law.
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(d) Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall be considered one and the same agreement. The delivery of this Agreement in the form of a clearly legible facsimile or electronically scanned version by email shall have the same force and effect as delivery of the originally executed document.
ACCEPTED AND AGREED:
| /s/ Justin Coe | November 3, 2026 | ||
| Justin Coe | Date Signed | ||
| ASHFORD HOSPITALITY ADVISORS LLC | |||
| /s/ Jim Plohg | November 2, 2026 | ||
| By: | Jim Plohg | Date Signed | |
| Title: | EVP | ||
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Exhibit 10.6
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into this 10th day of November, 2026, by and among BHR Luxury Hotels Management, LLC, a Texas limited liability company (the “Company”), Braemar Hotels & Resorts Inc., a Maryland corporation (“Parent”), and Robert G. Haiman (the “Executive”).
RECITALS
THE PARTIES ENTER THIS AGREEMENT on the basis of the following facts, understandings and intentions:
A. The Company desires to offer the Executive the benefits set forth in this Agreement and provide for the services of the Executive on the terms and conditions set forth in this Agreement.
B. The Executive desires to be employed by the Company on the terms and conditions set forth in this Agreement.
C. This Agreement shall govern the employment relationship between the Executive and the Company and all of its Affiliates effective as of the Effective Date (as defined below), and supersedes and negates any previous agreements with respect to such relationship.
AGREEMENT
NOW, THEREFORE, in consideration of the above recitals incorporated herein and the mutual covenants and promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby expressly acknowledged, the parties agree as follows:
| 1. | Retention and Duties. |
| 1.1 | Retention. The Company does hereby agree to employ the Executive for the Period of Employment (as such term is defined in Section 2) on the terms and conditions expressly set forth in this Agreement. The Executive does hereby accept and agree to such employment, on the terms and conditions expressly set forth in this Agreement. Certain capitalized terms used herein are defined in Section 5.5 of this Agreement. |
| 1.2 | Duties. During the Period of Employment, the Executive shall serve Parent as its Chief Legal Officer and Secretary and shall have the powers, authorities, duties and obligations generally consistent with that position as the Company may assign from time to time, all subject to the directives of the Chief Executive Officer and the corporate policies of the Company as they are in effect from time to time throughout the Period of Employment (including, without limitation, the Company’s business conduct and ethics policies, as they may change from time to time). During the Period of Employment, the Executive shall report to the Chief Executive Officer. In the event that the Executive serves as director or senior executive officer of one or more Affiliates, the Executive shall do so without additional compensation. |
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| 1.3 | No Other Employment; Minimum Time Commitment. During the Period of Employment, the Executive shall: (i) devote substantially all of the Executive’s business time, energy and skill to the performance of the Executive’s duties for the Company; (ii) perform such duties in a faithful, effective and efficient manner to the best of the Executive’s abilities; and (iii) hold no other employment. The Executive’s service on the boards of directors (or similar body) of other public companies is subject to the prior written approval of the Board of Directors of Parent (the “Board”). The Company shall have the right to require the Executive to resign from any board or similar body (including, without limitation, any association, corporate, civic or charitable board or similar body) which the Executive may then serve if the Board reasonably determines that the Executive’s service on such board or body interferes with the effective discharge of the Executive’s duties and responsibilities to the Company or that any business related to such service is then in direct or indirect competition with any business of the Company or any of its Affiliates, successors or assigns. |
| 1.4 | No Breach of Contract. The Executive hereby represents to the Company and agrees that: (i) the execution and delivery of this Agreement by the Executive and the Company and the performance by the Executive of the Executive’s duties hereunder do not and shall not constitute a breach of, conflict with, or otherwise contravene or cause a default under, the terms of any other agreement or policy to which the Executive is a party or otherwise bound or any judgment, order or decree to which the Executive is subject; (ii) the Executive will not enter into any new agreement that would or reasonably could contravene or cause a default by the Executive under this Agreement; (iii) the Executive has no information (including, without limitation, confidential information and trade secrets) relating to any other Person which would prevent, or be violated by, the Executive entering into this Agreement or carrying out the Executive’s duties hereunder; (iv) the Executive is not bound by any employment, consulting, non-compete, non-solicitation, confidentiality, trade secret or similar agreement (other than this Agreement) with any other Person (other than ongoing, customary confidentiality obligations as to confidential information obtained from prior employers in the course of the Executive’s prior employment with them); (v) to the extent the Executive has any confidential or similar information that the Executive is not free to disclose to the Company, the Executive will not disclose or bring on to the Company’s premises, computer networks, communications or systems, computers or any other devices or accounts, any such information to the extent such disclosure or transmission would violate applicable law or any other agreement or policy to which the Executive is a party or by which the Executive is otherwise bound; (vi) the Executive has not committed any acts of sexual harassment or any other type of workplace misconduct that would interfere with Executive carrying out the Executive’s duties hereunder; and (vii) the Executive understands the Company will rely upon the accuracy and truth of the representations and warranties of the Executive set forth herein and the Executive consents to such reliance. |
| 1.5 | Location. The Executive’s principal place of employment shall be the Company’s principal executive office as it may be located from time to time. The Executive agrees that the Executive will be regularly present at that office during regular business hours (except for required business travel, holidays, vacation and other leaves consistent with this Agreement) as reasonably required and consistent with the Company’s policies regarding remote work. The Executive acknowledges that the Executive will be required to travel from time to time in the course of performing the Executive’s duties for the Company. |
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| 2. | Period of Employment. The “Period of Employment” shall be a period of three (3) years commencing on November 10, 2026 (the “Effective Date”) and ending at the close of business on the third (3rd) anniversary of the Effective Date (the “Termination Date”); provided, however, that this Agreement shall be automatically renewed, and the Period of Employment shall be automatically extended for one (1) additional year on the Termination Date and each anniversary of the Termination Date thereafter, unless either party gives written notice at least sixty (60) days prior to the expiration of the Period of Employment (including any renewal thereof) of such party’s desire to terminate the Period of Employment (such notice to be delivered in accordance with Section 18). The term “Period of Employment” shall include any extension thereof pursuant to the preceding sentence. Notwithstanding the foregoing, the Period of Employment is subject to earlier termination as provided below in this Agreement. |
| 3. | Compensation. |
| 3.1 | Base Salary. During the Period of Employment, the Company shall pay the Executive a base salary (the “Base Salary”), which shall be paid in accordance with the Company’s regular payroll practices in effect from time to time. The Executive’s Base Salary shall be at an annualized rate of $450,000. The Compensation Committee of the Board (the “Compensation Committee”) will review the Executive’s rate of Base Salary on an annual basis and may, in its sole discretion, increase (but not decrease) the Executive’s Base Salary. |
| 3.2 | Incentive Bonus. The Executive shall be eligible to receive a cash incentive bonus for each fiscal year of the Company that occurs during the Period of Employment (“Incentive Bonus”). Notwithstanding the foregoing, except as otherwise expressly provided in this Agreement, the Executive must be employed by the Company at the time the Company pays incentive bonuses to employees generally with respect to a particular fiscal year in order to earn and be eligible for an Incentive Bonus for that year (and, if the Executive is not so employed at such time, in no event shall the Executive have been considered to have “earned” any Incentive Bonus with respect to the fiscal year), except as otherwise provided herein. Beginning with the Company’s 2026 fiscal year, the Executive’s target Incentive Bonus shall equal 100% of the Base Salary, the Executive’s maximum Incentive Bonus shall equal 150% of the Base Salary, and the Executive’s threshold Incentive Bonus shall equal 50% of the Base Salary. The Executive’s actual Incentive Bonus amount for a particular fiscal year shall be determined by the Compensation Committee, based on performance objectives (which may include corporate, business unit or division, financial, strategic, individual or other objectives) established with respect to that particular fiscal year by the Compensation Committee. Any Incentive Bonus that becomes payable for a fiscal year shall be paid no later than June 1 of the year following the fiscal year for which such bonus was earned. |
| 3.3 | Long-Term Incentive Compensation. During the Period of Employment, the Executive shall be eligible to participate in the Company’s or its Affiliates’ long-term incentive or other equity incentive plans applicable to similarly situated executives, as such plans may be adopted or amended from time to time, in each case subject to the terms of such plans and award agreements thereunder. |
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| 4. | Benefits. |
| 4.1 | Retirement, Welfare and Fringe Benefits. During the Period of Employment, the Executive shall be entitled to participate, on a basis generally consistent with other similarly situated executives, in all employee pension and welfare benefit plans and programs, and fringe benefit plans and programs and all other benefit plans and programs that are made available by the Company to the Company’s other similarly situated executives generally, in accordance with the eligibility and participation provisions of such plans and as such plans or programs may be in effect from time to time. |
| 4.2 | Reimbursement of Business Expenses. The Executive is authorized to incur reasonable expenses in carrying out the Executive’s duties for the Company under this Agreement and shall be entitled to reimbursement for all reasonable business expenses the Executive incurs during the Period of Employment in connection with carrying out the Executive’s duties for the Company, subject to the Company’s expense reimbursement policies and any pre-approval policies in effect from time to time. The Executive agrees to promptly submit and document any reimbursable expenses in accordance with the Company’s expense reimbursement policies to facilitate the timely reimbursement of such expenses. |
| 4.3 | Vacation and Other Leave. During the Period of Employment, the Executive shall accrue annual vacation on the same basis as other similarly situated executives, with such vacation to accrue and be subject to the Company’s vacation policies applicable to such similarly situated executives in effect from time to time, including any unlimited vacation policy or any policy which may limit vacation accruals and/or limit the amount of accrued but unused vacation to carry over from year to year. The Executive shall also be entitled to all other holiday and leave pay generally available to other similarly situated executives of the Company. |
| 5. | Termination. |
| 5.1 | Termination by the Company. During the Period of Employment, the Executive’s employment by the Company, and the Period of Employment, may be terminated at any time by the Company: (i) with Cause; or (ii) without Cause; or (iii) in the event of the Executive’s death; or (iv) in the event that the Board determines in good faith that the Executive has a Disability. |
| 5.2 | Termination by the Executive. During the Period of Employment, the Executive’s employment by the Company, and the Period of Employment, may be terminated by the Executive with no less than thirty (30) days advance written notice to the Company (such notice to be delivered in accordance with Section 18); provided, however, that in the case of a termination for Good Reason, the Executive may provide immediate written notice of termination once the applicable cure period (as contemplated by the definition of Good Reason) has lapsed if the Company has not reasonably cured the circumstances that gave rise to the basis for the Good Reason termination. |
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| 5.3 | Benefits upon Termination. If the Executive’s employment by the Company is terminated during the Period of Employment for any reason by the Company or by the Executive, or upon or following the expiration of the Period of Employment (the date that the Executive’s employment by the Company terminates is referred to as the “Severance Date”), the Company shall have no further obligation to make or provide to the Executive, and the Executive shall have no further right to receive or obtain from the Company, any payments or benefits except as follows: |
(a) The Company shall pay the Executive (or, in the event of the Executive’s death, the Executive’s estate) any Accrued Obligations. Any Prior-Year Bonus that becomes payable will be paid when the Incentive Bonus for active employees is scheduled to be paid, in accordance with Section 3.2.
(b) If the Executive’s employment with the Company terminates during the Period of Employment as a result of a termination by the Company without Cause (other than due to the Executive’s death or Disability), a resignation by the Executive for Good Reason, or the Company’s notice not to renew this Agreement and to terminate the Period of Employment, the Executive shall be entitled to the following benefits:
(i) The Company shall pay the Executive (in addition to the Accrued Obligations), subject to tax withholding and other authorized deductions, an amount equal to the sum of two (2) times (the “Severance Multiple”): (A) the Executive’s Base Salary at the annualized rate in effect on the Severance Date; and (B) the average Incentive Bonus received by the Executive for the three (3) completed calendar years preceding the Severance Date (or the number of completed calendar years the Executive has been employed by the Company on the Severance Date, if such number is fewer than three (3) years), provided, that if the Executive’s Severance Date occurs prior to the first (1st) anniversary of the Effective Date, such amount shall equal the target Incentive Bonus. Such amount is referred to hereinafter as the “Severance Benefit.” Subject to Section 5.7(b), the Company shall pay the Severance Benefit to the Executive in a lump sum payable on (or within ten (10) days following) the effective date of the Executive’s Release, provided that if the period to review the Release spans two (2) calendar years, the Severance Benefit shall be paid in the second (later) calendar year.
(ii) The Company will either: (A) pay for the Executive’s premiums charged to continue healthcare coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act or similar state law (“COBRA”), at the same or reasonably equivalent medical, dental, and vision coverage for the Executive (and, if applicable, the Executive’s eligible dependents) as in effect immediately prior to the Severance Date, to the extent that the Executive elects such continued coverage; or (B) to the extent COBRA coverage is not available, provide the Executive with a monthly cash payment equal to the cost to continue medical, dental, and vision coverage under COBRA; provided that the Company’s obligation to make any payment pursuant to this clause (ii) shall, subject to Section 5.7(a), commence with continuation coverage for the month following the month in which the Executive’s Separation from Service occurs and shall cease with continuation coverage for the twenty-fourth (24th) month following the month in which the Executive’s Separation from Service occurs (or, if earlier, shall cease upon the date the Executive becomes eligible for coverage under the health plan of a future employer). To the extent the Executive elects COBRA coverage, the Executive shall notify the Company in writing of such election prior to such coverage taking effect and complete any other continuation coverage enrollment procedures the Company may then have in place. In addition, the Company shall reimburse the Executive for the cost of premiums to continue life insurance and long-term disability coverage as in effect immediately prior to the Severance Date for twenty-four (24) months, payable in monthly installments following the Executive’s Separation from Service.
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(iii) With respect to the fiscal year in which the Severance Date occurs, the Company shall pay the Executive the Incentive Bonus that would otherwise have been paid (but not less than the amount payable at the target level set forth in Section 3.2) to the Executive had the Executive’s employment with the Company not terminated with respect to that fiscal year, multiplied by a fraction, the numerator of which is the total number of days in such fiscal year in which the Executive was employed by the Company and the denominator of which is the total number of days in such fiscal year (the “Pro-Rata Bonus”). Any Pro-Rata Bonus that becomes payable will be paid when the Severance Benefit is paid, in accordance with Section 3.2.
(iv) The Executive shall become fully vested in any unvested equity awards subject to time-based vesting that are outstanding on the Severance Date, with any awards subject to performance conditions that are in progress as of the Severance Date to vest on a pro-rated basis (based on number of days employed as a percentage of the applicable performance period) at the greater of: (A) the target performance level; or (B) the level otherwise provided in the applicable award agreement based on actual performance.
(c) If the Executive’s employment with the Company terminates during the Period of Employment due to the Executive’s death or Disability, the Executive shall be entitled to the benefits described in Section 5.3(b) above, except that the Severance Multiple shall be one (1).
(d) If the Executive’s employment with the Company terminates during the Period of Employment as a result of a resignation by the Executive without Good Reason (which shall include the Executive’s notice not to renew this Agreement and to terminate the Period of Employment), the Executive shall be entitled to the benefits described in Section 5.3(b)(ii) above. In addition, subject to the Executive’s compliance with the Restrictive Covenants described in Sections 6.2, 6.3, and 6.4 below, the Executive shall be entitled to the benefits described in Section 5.3(b)(i) above, except that: (A) the Severance Multiple shall be one (1); and (B) such payment will be made in twelve (12) substantially equal monthly installments, with the first installment payable on (or within ten (10) days following) the effective date of the Executive’s Release, provided that if the period to review the Release spans two (2) calendar years, such first installment shall be paid in the second (later) calendar year, and to include any installment that was otherwise delayed following the Executive’s Separation from Service.
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(e) Notwithstanding the foregoing provisions of this Section 5.3, if the Executive breaches the Executive’s obligations under Section 6 of this Agreement at any time, from and after the date of such breach and not in any way in limitation of any right or remedy otherwise available to the Company, the Executive will no longer be entitled to, and the Company will no longer be obligated to pay, any remaining unpaid portion of the Severance Benefit or any Prior-Year Bonus, Pro-Rata Bonus, equity acceleration for any outstanding and unvested equity awards that remain outstanding at the time of the breach, or the benefits described in Section 5.3(b)(ii) or Section 5.3(d); provided that, if the Executive provides the Release required by Section 5.4, in no event shall the Executive be entitled to benefits pursuant to this Section 5.3 of less than $5,000, which amount the parties agree is good and adequate consideration, in and of itself, for the Executive’s Release required by Section 5.4.
(f) The foregoing provisions of this Section 5.3 shall not affect: (i) the Executive’s receipt of benefits otherwise due to terminated employees under group insurance coverage consistent with the terms of the applicable Company welfare benefit plan; (ii) the Executive’s rights under COBRA to continue health coverage; or (iii) the Executive’s receipt of benefits otherwise due in accordance with the terms of the Company’s 401(k) plan (if any).
| 5.4 | Release; Exclusive Remedy; Leave. |
(a) This Section 5.4 shall apply notwithstanding anything else contained in this Agreement or any equity-based award agreement to the contrary. As a condition precedent to any Company obligation to the Executive pursuant to Section 5.3(b) or (d) or any other obligation to accelerate vesting of any equity-based award in connection with the termination of the Executive’s employment, the Executive shall provide the Company with a valid, executed general release agreement in substantially the form attached hereto as Exhibit A (the “Release”), and such Release shall have not been revoked by the Executive pursuant to any revocation rights afforded by applicable law. The Company shall provide the final form of Release to the Executive not later than seven (7) days following the Severance Date, and the Executive shall be required to execute and return the Release to the Company within twenty-one (21) days (or forty-five (45) days if such longer period of time is required to make the Release maximally enforceable under applicable law).
(b) The Executive agrees that the payments and benefits contemplated by Section 5.3 (and any applicable acceleration of vesting of an equity-based award in accordance with the terms of such award in connection with the termination of the Executive’s employment) shall constitute the exclusive and sole remedy for any termination of the Executive’s employment and the Executive covenants not to assert or pursue any other remedies, at law or in equity, with respect to any termination of employment. The Company and the Executive acknowledge and agree that there is no duty of the Executive to mitigate damages under this Agreement. All amounts paid to the Executive pursuant to Section 5.3 shall be paid without regard to whether the Executive has taken or takes actions to mitigate damages. The Executive agrees to resign, on the Severance Date, as an officer and director of the Company and any Affiliate of the Company, and as a fiduciary of any benefit plan of the Company or any Affiliate of the Company, and to promptly execute and provide to the Company any further documentation, as requested by the Company, to confirm such resignation, and to remove himself as a signatory on any accounts maintained by the Company or any of its Affiliates (or any of their respective benefit plans) at the Company’s sole cost and expense.
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(c) In the event that the Executive provides the Company notice of termination pursuant to Section 5.2, the Company will have the option to place the Executive on paid administrative leave during the notice period.
| 5.5 | Certain Defined Terms. |
(a) As used herein, “Accrued Obligations” means:
(i) any Base Salary that had accrued but had not been paid (including accrued and unpaid vacation time) on or before the Severance Date;
(ii) any reimbursement due to the Executive pursuant to Section 4.2 for expenses incurred by the Executive on or before the Severance Date and documented, to the extent applicable, in accordance with the Company’s expense reimbursement policies in effect at the applicable time; and
(iii) any Incentive Bonus that would otherwise be paid to the Executive had the Executive’s employment with the Company not terminated with respect to any fiscal year that ended before the Severance Date, to the extent not theretofore paid (the “Prior-Year Bonus”).
(b) As used herein, “Affiliate” of the Company means a Person that directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Company. As used in this definition, the term “control,” including the correlative terms “controlling,” “controlled by” and “under common control with,” means the possession, directly or indirectly, of the power to direct or cause the direction of management or policies (whether through ownership of securities or any partnership or other ownership interest, by contract or otherwise) of a Person.
(c) As used herein, “Cause” shall mean, as reasonably determined by the Board (excluding the Executive, if the Executive is then a member of the Board) based on the information then known to it, that one or more of the following has occurred:
(i) the conviction of the Executive of, or the entry of a plea of guilty or nolo contendere by the Executive to, a felony (exclusive of a conviction, plea of guilty or nolo contendere arising under a statutory provision imposing criminal liability upon the Executive on a per se basis due to any offices held by the Executive pursuant to the terms of this Agreement, so long as any act or omission of the Executive with respect to such matter was not taken or omitted in contravention of any applicable policy or directive of the Chief Executive Officer or the Board);
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(ii) the Executive’s willful breach of the Executive’s duty of loyalty which is materially detrimental to the Company or any of its Affiliates and which is not cured to the reasonable satisfaction of the Board within thirty (30) days following written warning to the Executive from the Chief Executive Officer or the Board describing the alleged circumstances; provided that if there is an inconsistency in directives given by the Board as compared to a directive from the Company’s Chief Executive Officer, the Board directives shall control;
(iii) gross negligence or willful misconduct in the performance of the Executive’s duties (which is not cured by the Executive within thirty (30) days after written warning from the Chief Executive Officer or the Board);
(iv) the Executive’s willful commission of an act of dishonesty resulting in material economic or financial injury to the Company or any of its Affiliates, or willful commission of fraud; or
(v) the Executive’s chronic absence from work for reasons other than illness, Disability (as defined below), or business - related travel which is not cured to the reasonable satisfaction of the Chief Executive Officer or the Board within thirty (30) days following written warning to the Executive from the Chief Executive Officer or the Board describing the alleged circumstances.
For purposes of this Section 5.5(c), no act, or failure to act, on the Executive’s part will be deemed “willful” unless done, or omitted to be done, by the Executive not in good faith and without a reasonable belief that the Executive’s act, or failure to act, was in the best interest of the Company or any of its Affiliates. Any act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the Board, a directive of the Company’s Chief Executive Officer, or based upon the advice of outside counsel for the Company or its Affiliates shall be conclusively presumed to have been done, or omitted, by the Executive in good faith and in the best interests of the Company and its Affiliates.
(d) As used herein, “Disability” shall mean a physical or mental impairment which, as reasonably determined by the Board, renders the Executive unable to perform the essential functions of the Executive’s employment with the Company, even with reasonable accommodation that does not impose an undue hardship on the Company, for more than ninety (90) days in any one hundred eighty (180)-day period, unless a longer period is required by federal or state law, in which case that longer period would apply. The Executive agrees to reasonably cooperate with the Board in making any such determination as to the existence of Disability.
| (e) | As used herein, “Good Reason” shall mean the occurrence (without the Executive’s written consent) of any one or more of the following conditions: |
(i) any diminution in the Executive’s Base Salary or Incentive Bonus (including any reduction to the threshold, target, or maximum Incentive Bonus levels (as set forth in Section 3.2));
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(ii) any diminution, not consented to by the Executive in a writing signed by the Executive, in the nature or scope of the Executive’s responsibilities, authorities, powers, functions, title or duties, which shall be determined taking into account that Parent is, as of the Effective Date, a public company and shall specifically include: (A) any requirement to report directly to any individual other than the Chief Executive Officer; and (B) any requirement to report, directly or indirectly, to any executive of any Affiliate that is the parent company of, or otherwise controls, Parent;
(iii) a material change in the geographic location of the Executive’s principal office with the Company to a location outside the greater Dallas, Texas metropolitan area; or
(iv) a material breach by the Company of this Agreement or any other material agreement in effect between the Executive and the Company or any of its Affiliates;
provided, however, that any such condition or conditions, as applicable, shall not constitute Good Reason unless both: (x) the Executive provides written notice to the Company of the condition claimed to constitute Good Reason within thirty (30) days of the initial existence of such condition(s) (such notice to be delivered in accordance with Section 18); and (y) the Company fails to remedy such condition(s) within thirty (30) days of receiving such written notice thereof; and provided, further, that in all events the termination of the Executive’s employment with the Company shall not constitute a termination for Good Reason unless such termination occurs not more than one hundred twenty (120) days following the initial existence of the condition claimed to constitute Good Reason.
(f) As used herein, the term “Person” shall be construed broadly and shall include, without limitation, an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.
(g) As used herein, “Restricted Period” means the period beginning on the Effective Date and ending on the first (1st) anniversary of the Executive’s Severance Date.
(h) As used herein, a “Separation from Service” occurs when the Executive dies, retires, or otherwise has a termination of employment with the Company that constitutes a “separation from service” within the meaning of Treasury Regulation Section 1.409A-1(h)(1), without regard to the optional alternative definitions available thereunder.
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| 5.6. | Notice of Termination; Employment Following Expiration of Period of Employment. Any termination of the Executive’s employment under this Agreement shall be communicated by written notice of termination from the terminating party to the other party. This notice of termination must be delivered in accordance with Section 18 and must indicate the specific provision(s) of this Agreement relied upon in effecting the termination and the basis of any termination by the Company for Cause or by the Executive for Good Reason. |
| 5.7 | Section 409A. |
| (a) | It is intended that any amounts payable under this Agreement shall either be exempt from or comply with Section 409A of the Code (including the Treasury regulations and other published guidance relating thereto) (“Code Section 409A”) so as not to subject the Executive to payment of any additional tax, penalty or interest imposed under Code Section 409A. The provisions of this Agreement shall be construed and interpreted to avoid the imputation of any such additional tax, penalty or interest under Code Section 409A yet preserve (to the nearest extent reasonably possible) the intended benefit payable to the Executive. Any installment payments provided for in this Agreement shall be treated as a series of separate payments for purposes of Code Section 409A. The Company makes no representation that any or all of the payments described in this Agreement will be exempt from or comply with Code Section 409A, and the Executive is solely responsible for any additional taxes, penalties or interest imposed under Code Section 409A. |
| (b) | If the Executive is a “specified employee” within the meaning of Treasury Regulation Section 1.409A-1(i) as of the date of the Executive’s Separation from Service, the Executive shall not be entitled to any payment or benefit pursuant to this Agreement until the earlier of: (i) the date which is six (6) months after the Executive’s Separation from Service for any reason other than death; or (ii) the date of the Executive’s death. The provisions of this Section 5.7(b) shall only apply if, and to the extent, required to avoid the imputation of any tax, penalty or interest pursuant to Code Section 409A. Any amounts otherwise payable to the Executive upon or in the six (6) month period following the Executive’s Separation from Service that are not so paid by reason of this Section 5.7(b) shall be paid (without interest) as soon as practicable (and in all events within thirty (30) days) after the date that is six (6) months after the Executive’s Separation from Service (or, if earlier, as soon as practicable, and in all events within thirty (30) days, after the date of the Executive’s death). |
| (c) | To the extent that any benefits or reimbursements pursuant to this Agreement are taxable to the Executive, any reimbursement payment due to the Executive pursuant to any such provision shall be paid to the Executive on or before the last day of the Executive’s taxable year following the taxable year in which the related expense was incurred. The benefits and reimbursements pursuant to such provisions are not subject to liquidation or exchange for another benefit and the amount of such benefits and reimbursements that the Executive receives in one taxable year shall not affect the amount of such benefits or reimbursements that the Executive receives in any other taxable year. |
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| 5.8 | Possible Limitation of Benefits in Connection with a Change in Control. Notwithstanding anything contained in this Agreement to the contrary, if following a change in ownership or effective control or in the ownership of a substantial portion of assets (in each case, within the meaning of Section 280G of the Code), the tax imposed by Section 4999 of the Code or any similar or successor tax (the “Excise Tax”) applies to any payments, benefits and/or amounts received by the Executive pursuant to this Agreement or otherwise, including, without limitation, any acceleration of the vesting of outstanding equity awards (collectively, the “Total Payments”), then the Total Payments shall be reduced (but not below zero) so that the maximum amount of the Total Payments (after reduction) shall be one dollar ($1.00) less than the amount which would cause the Total Payments to be subject to the Excise Tax; provided that such reduction to the Total Payments shall be made only if the total after-tax benefit to the Executive is greater after giving effect to such reduction than if no such reduction had been made. If such a reduction is required, the Company shall reduce or eliminate the Total Payments by first reducing or eliminating any cash payments under this Agreement, then by reducing or eliminating any accelerated vesting of equity awards, then by reducing or eliminating any other remaining Total Payments, in each case in reverse order beginning with the payments which are to be paid the farthest in time from the date of the transaction triggering the Excise Tax. The provisions of this Section 5.8 shall take precedence over the provisions of any other plan, arrangement or agreement governing the Executive’s rights and entitlements to any benefits or compensation. |
| 6. | Protective Covenants. |
| 6.1 | Confidential Information. The Executive recognizes and acknowledges that the Executive has, will have access to, and will receive confidential and proprietary information of the Company and its Affiliates, which, in each case, constitute valuable, special, and unique assets of such entity. The term “Confidential Information” as used in this Agreement shall mean all non-public information of the Company and its Affiliates, as applicable, including, without limitation, information regarding clients, customers, pricing policies, methods of operation, proprietary company programs, sales, acquisitions, products, profits, costs, conditions (financial or other), cash flows, key personnel, formulae, product applications, technical processes, and trade secrets, as such information may exist from time to time, which the Executive acquired or obtained by virtue of work performed for the Company (whether prior to or after the Effective Date), or which the Executive may acquire or may have acquired knowledge of during the performance of said work. |
The Executive acknowledges that the Company has put in place certain policies and practices to keep such Confidential Information secret, including disclosing Confidential Information only on a need-to-know basis. The Executive further acknowledges that the Confidential Information has been developed or acquired by the Company through the expenditure of substantial time, effort, and money and provides the Company with an advantage over competitors who do not know such Confidential Information. Finally, the Executive acknowledges that such Confidential Information, if revealed to or used for the benefit of the Company’s competitors or in a manner contrary to the Company’s interests, would cause extensive and immeasurable harm to the Company and to the Company’s competitive position.
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The Executive shall not, during the Period of Employment or at any time thereafter, use for personal gain, for the benefit of any third party, or detrimentally to the Company all or any part of the Confidential Information, or disclose or make available all or any part of the Confidential Information to any person, firm, corporation, association, or any other entity for any reason or purpose whatsoever, directly or indirectly, except as may be required pursuant to the Executive’s employment hereunder, unless and until such Confidential Information becomes publicly available other than as a consequence of the breach by the Executive of the Executive’s confidentiality obligations hereunder. Notwithstanding the foregoing, Executive shall not be restricted from disclosing or using Confidential Information that: (i) is or becomes generally available to the public other than as a result of an unauthorized disclosure by Executive or the Executive’s agent; (ii) becomes available to the Executive in a manner that is not in contravention of applicable law or in violation of any confidentiality or similar agreement from a source (other than the Company, its Affiliates, or their officers, employees, agents or representatives) that is not known by Executive, after reasonable investigation, to be bound by a confidential relationship with the Company or any Affiliate or by a confidentiality or other similar agreement; or (iii) is required to be disclosed by law, court order or other legal process; provided, however, that in the event disclosure is required by law, court order or legal process, Executive shall provide the Company, if legally permissible, with prompt notice of such requirement as set forth below in this Section 6.1.
The Executive acknowledges that the Confidential Information shall remain at all times the exclusive property of the Company, and no license is granted to the Executive. In the event of the termination of the Executive’s employment, whether voluntary or involuntary and whether by the Company or the Executive, or within seven (7) days of the Company’s request under any other circumstances, the Executive shall deliver to the Company all Confidential Information, in any form whatsoever, including electronic formats, and shall not take with him any Confidential Information or any reproductions (in whole or in part) or extracts of any items relating to the Confidential Information. The Company acknowledges that prior to the Executive’s employment with the Company, the Executive has lawfully acquired extensive knowledge of the industries in which the Company engages in business including, without limitation, markets, valuation methods and techniques, capital markets, investor relationships and similar items, and that the provisions of this Section 6.1 are not intended to restrict the Executive’s use of such previously acquired knowledge.
By this Agreement, the Company is providing the Executive with rights that the Executive did not previously have. In exchange for the foregoing and the additional terms agreed to in this Agreement, the Executive agrees that: (i) the Executive is being provided with access to and has received and will receive Confidential Information to which the Executive has not previously had access; and (ii) all goodwill developed with the Company’s clients, customers and other business contacts by the Executive is the exclusive property of the Company and that the Executive has benefited from such goodwill. The Executive waives and releases any claim that he should be able to use, for the benefit of any competing person or entity, client and customer goodwill or Confidential Information that was previously received or developed by the Executive while working for the Company or any Affiliate.
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| 6.2 | Restriction on Competition. During the Restricted Period, the Executive will not, directly or indirectly, either as a principal, agent, employee, employer, stockholder or partner engage in any “Competitive Business;” provided, however, that the foregoing shall not prohibit or limit the Executive’s right to pursue and maintain passive investments allowed pursuant to this Section 6.2. For purposes of this Section 6.2, “Competitive Business” means a business whose primary business is acquiring, investing in or with respect to, owning or leasing hotel properties in the United States or in any international market in which the Company or its Affiliates conduct such business or originating or acquiring loans in respect of hotel properties in the United States or in any international market in which the Company or its Affiliates conduct such business, in each case, where the Executive had duties or performed services for the Company, which the parties stipulate is a reasonable geographic area because of the scope of the Company’s operations and the Executive’s employment with the Company. The Executive may not avoid the purpose and intent of this restriction by engaging in conduct within the geographically limited area from a remote location through means such as telecommunications, written correspondence, computer generated or assisted communications, or other similar methods. |
| 6.3 | Non-Solicitation of Employees. The Executive covenants and agrees that during the Restricted Period, the Executive shall not, without the prior written consent of the Company, directly or indirectly, whether for the Executive’s own account or on behalf of any person, firm, corporation, partnership, association or other entity or enterprise, solicit, recruit, hire or cause to be hired any employees of the Company or any of its Affiliates, or any person who was an employee of the Company during the six (6) months preceding the Executive’s Severance Date, or solicit or encourage any employee of the Company or any of its Affiliates to leave the employment of the Company or any of such Affiliates, as applicable. The parties hereto agree that: (i) the placement of general advertisements that may be targeted to a particular geographic or technical area but which are not targeted directly or indirectly towards any employees, officers, agents or representatives of the Company (or any successor entity) shall not be deemed a breach of this Section 6.3; and (ii) the employment or engagement of such persons by an entity that is not controlled by the Executive and whom the Executive did not encourage, solicit or induce or in any manner attempt to encourage, solicit or induce to terminate such person’s employment with the Company shall not be deemed a breach of this Section 6.3. |
| 6.4 | Non-Interference with Customers. The Executive understands and agrees that all business opportunities related to the business of the Company and its Affiliates that arise during the Period of Employment constitute valuable assets of the Company and its Affiliates, and may not be converted to the Executive’s own use or converted by Executive for the use of any person, firm, corporation, partnership, association or other entity or enterprise. Accordingly, Executive agrees that, during the Restricted Period, the Executive shall not, directly or indirectly, whether for the Executive’s own account or on behalf of any person, firm, corporation, partnership, association or other entity or enterprise, interfere with, solicit, pursue, or in any manner make use of any such business opportunities. |
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| 6.5 | Non-Disparagement. The Executive agrees that, during the Period of Employment and thereafter (including following the Executive’s termination of employment for any reason) the Executive will not make statements or representations, or otherwise communicate, directly or indirectly, in writing, orally, or otherwise, or take any action which may, directly or indirectly, disparage the Company or its Affiliates or their respective officers, directors, employees, advisors, businesses or reputations. The Company agrees that, during the Period of Employment and thereafter (including following Executive’s termination of employment for any reason), the Company’s directors, officers or other employees will not make statements or representations, or otherwise communicate, directly or indirectly, in writing, orally, or otherwise, or take any action which may directly or indirectly, disparage Executive or the Executive’s family or the Executive’s business or reputation; provided, however, the Company shall have no liability for any communication by its employees (other than its officers) that violates this non-disparagement clause, unless an officer of the Company is made aware of such communication and fails to take appropriate action to enforce this non-disparagement clause on behalf of the Company. Notwithstanding the foregoing, nothing in this Agreement shall preclude either Executive or the Company from making truthful statements or disclosures that are required by applicable law, regulation, or legal process. Notwithstanding the foregoing, nothing in this Agreement prohibits the Executive from reporting possible violations of federal law or regulation to any government agency or entity or making any other disclosure protected under whistleblower provisions of law. The Executive does not need prior authorization to make such reports or disclosures and is not required to notify the Company that the Executive has made any such report of disclosure. |
| 6.6 | Protected Disclosures; Defend Trade Secrets Act. Pursuant to the Defend Trade Secrets Act of 2016, the Executive acknowledges that the Executive may not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of Confidential Information that: (a) is made in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney solely for the purpose of reporting or investigating a suspected violation of law; or (b) is made in a complaint or other document that is filed in a lawsuit or other proceeding, provided that such filing is made under seal. Further, the Company shall not retaliate against the Executive in any way for any such disclosure made in accordance with applicable law. In the event a disclosure is made, and the Executive files any type of proceeding against the Company alleging that the Company retaliated against the Executive because of the Executive’s disclosure, the Executive may disclose the relevant Confidential Information to the Executive’s attorney and may use the Confidential Information in the proceeding if: (x) the Executive files any document containing the Confidential Information under seal; and (y) the Executive does not otherwise disclose the Confidential Information except pursuant to court or arbitral order. |
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Nothing in this Section 6 or elsewhere in this Agreement shall prevent the Executive from: (A) responding to a lawful subpoena; (B) reporting to a government agency; (C) participating in an investigation by a government agency; (D) providing truthful testimony under oath; (E) exercising the Executive’s rights under Section 7 of the National Labor Relations Act; (F) disclosing or discussing information about unlawful acts in the workplace, such as harassment, including sexual harassment, discrimination, or any other conduct that Employee has reason to believe is unlawful; (G) disclosing information about sexual assault or sexual abuse; or (H) complying with any other legal obligation.
| 6.7 | Understanding of Covenants. The Executive acknowledges that, in the course of the Executive’s employment with the Company and/or its Affiliates and their predecessors, the Executive has become familiar, or will become familiar, with the Company’s and its Affiliates’ and their predecessors’ trade secrets and with other confidential and proprietary information concerning the Company, its Affiliates and their respective predecessors and that the Executive’s services have been and will be of special, unique and extraordinary value to the Company and its Affiliates. The Executive agrees that the foregoing covenants set forth in this Section 6 (together, the “Restrictive Covenants”) are reasonable and necessary to protect the Company’s and its Affiliates’ trade secrets and other confidential and proprietary information, good will, stable workforce, and customer relations. |
Without limiting the generality of the Executive’s agreement in the preceding paragraph, the Executive: (i) represents that the Executive is familiar with and has carefully considered the Restrictive Covenants; (ii) represents that the Executive is fully aware of the Executive’s obligations hereunder; (iii) agrees to the reasonableness of the length of time, scope and geographic coverage, as applicable, of the Restrictive Covenants; (iv) agrees that the Company and its Affiliates currently conduct business throughout the United States and may expand its business outside of the United States; and (v) agrees that the Restrictive Covenants will continue in effect for the applicable periods set forth above in this Section 6 regardless of whether the Executive is then entitled to receive severance pay or benefits from the Company. The Executive understands that the Restrictive Covenants may limit the Executive’s ability to earn a livelihood in a business similar to the business of the Company and any of its Affiliates, but the Executive nevertheless believes that the Executive has received and will receive sufficient consideration and other benefits as an employee of the Company and as otherwise provided hereunder or as described in the recitals hereto to clearly justify such restrictions which, in any event (given the Executive’s education, skills and ability), the Executive does not believe would prevent the Executive from otherwise earning a living. The Executive agrees that the Restrictive Covenants do not confer a benefit upon the Company disproportionate to the detriment of the Executive.
| 6.8 | Enforcement. The Executive agrees that the Executive’s services are unique and that the Executive has access to Confidential Information. Accordingly, without limiting the generality of Section 17, the Executive agrees that a breach by the Executive of any of the covenants in this Section 6 would cause immediate and irreparable harm to the Company that would be difficult or impossible to measure, and that damages to the Company for any such injury would therefore be an inadequate remedy for any such breach. Therefore, the Executive agrees that in the event of any breach or threatened breach of any provision of this Section 6, the Company shall be entitled, in addition to and without limitation upon all other remedies the Company may have under this Agreement, at law or otherwise, to obtain specific performance, injunctive relief and/or other appropriate relief (without posting any bond or deposit) in order to enforce or prevent any violations of the provisions of this Section 6. |
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| 7. | Withholding Taxes. Notwithstanding anything else herein to the contrary, the Company may withhold (or cause there to be withheld, as the case may be) from any amounts otherwise due or payable under or pursuant to this Agreement such federal, state and local income, employment, or other taxes as may be required to be withheld pursuant to any applicable law or regulation. Except for such withholding rights, the Executive is solely responsible for any and all tax liability that may arise with respect to the compensation provided under or pursuant to this Agreement. |
| 8. | Successors and Assigns. |
(a) This Agreement is personal to the Executive and without the prior written consent of the Company shall not be assignable by the Executive otherwise than by will or the laws of descent and distribution. This Agreement shall inure to the benefit of and be enforceable by the Executive’s legal representatives.
(b) This Agreement shall inure to the benefit of and be binding upon the Company, Parent, and their respective successors and assigns, and each of Company and Parent shall be liable for the payment of benefits hereunder. Without limiting the generality of the preceding sentence, the Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to assume expressly and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used in this Agreement, “Company” shall mean the Company as hereinbefore defined and any successor or assignee, as applicable, which assumes and agrees to perform this Agreement by operation of law or otherwise.
| 9. | Number and Gender; Examples. Where the context requires, the singular shall include the plural, the plural shall include the singular, and any gender shall include all other genders. Where specific language is used to clarify by example a general statement contained herein, such specific language shall not be deemed to modify, limit or restrict in any manner the construction of the general statement to which it relates. |
| 10. | Section Headings. The section headings of, and titles of paragraphs and subparagraphs contained in, this Agreement are for the purpose of convenience only, and they neither form a part of this Agreement nor are they to be used in the construction or interpretation thereof. |
| 11. | Governing Law. This Agreement will be governed by and construed in accordance with the laws of the state of Texas, without giving effect to any choice of law or conflicting provision or rule (whether of the state of Texas or any other jurisdiction) that would cause the laws of any jurisdiction other than the state of Texas to be applied. In furtherance of the foregoing, the internal law of the state of Texas will control the interpretation and construction of this Agreement, even if under such jurisdiction’s choice of law or conflict of law analysis, the substantive law of some other jurisdiction would ordinarily apply. |
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| 12. | Severability. It is the desire and intent of the parties hereto that the provisions of this Agreement be enforced to the fullest extent permissible under the laws and public policies applied in each jurisdiction in which enforcement is sought. Accordingly, if any particular provision of this Agreement shall be adjudicated by a court of competent jurisdiction or determined by an arbitrator pursuant to Section 16 to be invalid, prohibited or unenforceable under any present or future law, and if the rights and obligations of any party under this Agreement will not be materially and adversely affected thereby, such provision, as to such jurisdiction, shall be ineffective, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction, and to this end the provisions of this Agreement are declared to be severable; furthermore, in lieu of such invalid or unenforceable provision there will be added automatically as a part of this Agreement, a legal, valid and enforceable provision as similar in terms to such invalid or unenforceable provision as may be possible. Notwithstanding the foregoing, if such provision could be more narrowly drawn (as to geographic scope, period of duration or otherwise) so as not to be invalid, prohibited or unenforceable in such jurisdiction, it shall, as to such jurisdiction, be so narrowly drawn, without invalidating the remaining provisions of this Agreement or affecting the validity or enforceability of such provision in any other jurisdiction. |
| 13. | Entire Agreement. This Agreement embodies the entire agreement of the parties hereto respecting the matters within its scope. This Agreement supersedes all prior and contemporaneous agreements of the parties hereto that directly or indirectly bears upon the subject matter hereof (including, without limitation, any prior employment or similar agreements). Any prior negotiations, correspondence, agreements, proposals or understandings relating to the subject matter hereof shall be deemed to have been merged into this Agreement, and to the extent inconsistent herewith, such negotiations, correspondence, agreements, proposals, or understandings shall be deemed to be of no force or effect. There are no representations, warranties, or agreements, whether express or implied, or oral or written, with respect to the subject matter hereof, except as expressly set forth herein. |
| 14. | Modifications. This Agreement may not be amended, modified or changed (in whole or in part), except by a formal, definitive written agreement expressly referring to this Agreement, which agreement is executed by both of the parties hereto. |
| 15. | Waiver. Neither the failure nor any delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or of any right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver. |
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| 16. | Arbitration. Except as provided in Sections 6.8 and 17, in the event that there is any claim or dispute arising out of or relating to this Agreement, or the breach (or alleged breach) thereof, and the parties hereto shall not have resolved such claim or dispute within sixty (60) days after written notice from one party to the other setting forth the nature of such claim or dispute, then such claim or dispute shall be settled exclusively by binding arbitration in Dallas, Texas in accordance with the Employment Arbitration Rules of the American Arbitration Association (the “AAA Rules”) by an arbitrator mutually agreed upon by the parties hereto or, in the absence of such agreement, by an arbitrator selected according to such AAA Rules. Notwithstanding the foregoing, if either the Company or the Executive shall request, such arbitration shall be conducted by a panel of three arbitrators, one selected by the Company, one selected by the Executive and the third selected by agreement of the first two, or, in the absence of such agreement, in accordance with the AAA Rules. Neither party shall have the right to claim or recover punitive damages. Judgment upon the award rendered by such arbitrator(s) shall be entered in any court having jurisdiction thereof upon the application of either party. Except as provided in Sections 6.8 and 17, the parties acknowledge and agree that they are hereby waiving any rights to trial by jury or a court in any action or proceeding brought by either of the parties against the other in connection with any matter whatsoever arising out of or in any way connected with this Agreement or the Executive’s employment. |
| 17. | Remedies. Each of the parties to this Agreement and any Person granted rights hereunder whether or not such person or entity is a signatory hereto shall be entitled to enforce its rights under this Agreement specifically to recover damages and costs for any breach of any provision of this Agreement and to exercise all other rights existing in its favor. The parties hereto agree and acknowledge that money damages may not be an adequate remedy for any breach of the provisions of this Agreement and that each party (as well as each other Person granted rights hereunder) may in its sole discretion obtain permanent injunctive or equitable relief in any arbitration filed pursuant to Section 16 and enforce any such relief awarded by the arbitrator in any court of competent jurisdiction. In addition, each party may also apply to any court of law or equity of competent jurisdiction for provisional injunctive or equitable relief, including a temporary restraining or preliminary injunction (without any requirement to post any bond or deposit), to ensure that the relief sought in arbitration is not rendered ineffectual by interim harm. Each party shall be responsible for paying its own attorneys’ fees, costs and other expenses pertaining to any such legal proceeding and enforcement regardless of whether an award or finding or any judgment or verdict thereon is entered against either party. |
| 18. | Notices. Any notice provided for in this Agreement must be in writing and must be either personally delivered, transmitted via email, mailed by first class mail (postage prepaid and return receipt requested) or sent by reputable overnight courier service (charges prepaid) to the recipient at the address below indicated or at such other address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party. Notices will be deemed to have been given hereunder and received when delivered personally, when received if sent via email, five (5) days after deposit in the U.S. mail and one (1) day after deposit with a reputable overnight courier service. |
if to the Company:
| BHR Luxury Hotels Management, LLC 14001 Dallas Parkway, Suite 1100 Dallas, TX 75240 Attention: Chief Executive Officer |
if to the Executive, to the address most recently on file in the payroll records of the Company.
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| 19. | Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original as against any party whose signature appears thereon, and all of which together shall constitute one and the same instrument. This Agreement shall become binding when one or more counterparts hereof, individually or taken together, shall bear the signatures of all of the parties reflected hereon as the signatories. Photographic copies of such signed counterparts may be used in lieu of the originals for any purpose. |
| 20. | Legal Counsel; Mutual Drafting. Each party recognizes that this is a legally binding contract and acknowledges and agrees that they have had the opportunity to consult with legal counsel of their choice. Each party has cooperated in the drafting, negotiation and preparation of this Agreement. Hence, in any construction to be made of this Agreement, the same shall not be construed against either party on the basis of that party being the drafter of such language. The Executive agrees and acknowledges that the Executive has read and understands this Agreement, is entering into it freely and voluntarily, and has been advised to seek counsel prior to entering into this Agreement and has had ample opportunity to do so. |
| 21. | Indemnification and D&O Insurance Coverage. The Company will indemnify the Executive, to the maximum extent permitted by applicable law, against all costs, charges and expenses incurred or sustained by the Executive, including the cost of legal counsel selected and retained by the Executive in connection with any action, suit or proceeding to which the Executive may be made a party by reason of the Executive being or having been an officer, director, or employee of the Company or any Affiliate, or a consultant of Hospitality Professional Services II, PLLC. The Company’s obligations under this Section 21 shall be in addition to any other indemnification rights to which the Executive may be entitled; provided, however, that in no event shall the Executive’s indemnification rights and the rights to advancement of fees and expenses at any time be less favorable than the indemnification rights and rights to advancement of fees and expenses generally available to officers or directors of the Company or its Affiliates. During and for a period equal to the relevant statute of limitations following the Period of Employment, the Executive shall be entitled to director and officer insurance coverage for his acts and omissions while an officer of the Company (or any of its Affiliates, or a consultant of Hospitality Professional Services II, PLLC, as applicable) on a basis no less favorable to the Executive than the coverage provided other similarly situated executives or directors of the Company or its Affiliates. |
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| 22. | Full Settlement. The Company’s obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action which the Company may have against the Executive or others. The Company agrees to pay as incurred (within thirty (30) days following the Company’s receipt of an invoice from the Executive), to the full extent permitted by law, all reasonable legal fees and expenses which the Executive or his beneficiaries may reasonably incur as a result of any contest (regardless of the outcome thereof) by the Company, the Executive or others of the validity or enforceability of, or liability under, any provision of this Agreement or any guarantee of performance thereof (including as a result of any contest by the Executive or his beneficiaries about the amount of any payment pursuant to this Agreement), plus in each case interest on any delayed payment at the applicable Federal rate provided for in Section 7872(f)(2)(a) of the Code to the extent permitted by Code Section 409A. The preceding sentence shall not apply with respect to any such contest if the court having jurisdiction over such contest makes a final determination that the Executive’s claim in such contest is frivolous or maintained in bad faith. This reimbursement obligation shall remain in effect following the Executive’s termination of employment for the applicable statute of limitations period relating to any such claim. |
| 23. | Clawback Policy. All compensation payable under this Agreement is subject to the terms of the Company’s recoupment, clawback or similar policy as it may be in effect from time to time, as well as any similar provisions of applicable law. |
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IN WITNESS WHEREOF, the Company and the Executive have executed this Agreement as of the date hereof.
| “COMPANY” | |||
| BHR LUXURY HOTELS MANAGEMENT, LLC, | |||
| a Texas limited liability company | |||
| By: | Braemar Hospitality Limited Partnership, a Delaware limited partnership | ||
| Sole Member | |||
| By: | Braemar OP General Partner LLC, | ||
| a Delaware limited liability company | |||
| General Partner | |||
| By: | /s/ Richard J. Stockton | ||
| Richard J. Stockton | |||
| President & CEO | |||
| “PARENT” | ||
| BRAEMAR HOTELS & RESORTS INC. | ||
| a Maryland corporation | ||
| By: | /s/ Richard J. Stockton | |
| Richard J. Stockton | ||
| President & CEO | ||
| “EXECUTIVE” | |
| /s/ Robert G. Haiman | |
| Robert G. Haiman |
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EXHIBIT A
RELEASE AND WAIVER
THIS RELEASE AND WAIVER (this “Termination Release”) is made and entered into as of the / / day of / /, 20/ / by and among Robert G. Haiman (the “Executive”), BHR Luxury Hotels Management, LLC, a Texas limited liability company (the “Company”), and Braemar Hotels & Resorts Inc., a Maryland corporation (the “Parent”).
WHEREAS, the Company, the Parent and the Executive entered into an Employment Agreement (the “Agreement”), effective as of November 10, 2026, which provides for payment of the Severance Benefits (as defined below) upon the Executive’s termination of employment in certain circumstances;
WHEREAS, the Executive has agreed, pursuant to the terms of the Agreement, to execute and, if applicable, not revoke, a release and waiver in the form set forth in this Termination Release in consideration of the Company’s agreement to provide the Severance Benefits;
WHEREAS, capitalized terms not defined herein shall have the meanings set forth in the Agreement; and
WHEREAS, the Company, the Parent and the Executive desire to settle all rights, duties and obligations between them, including without limitation all such rights, duties, and obligations arising under the Agreement or otherwise out of the Executive’s employment by the Company.
NOW THEREFORE, intending to be legally bound and for good and valid consideration the sufficiency of which is hereby acknowledged, the Executive agrees as follows:
| 1. | QUALIFYING TERMINATION PAYMENTS AND CONDITIONS. The Executive and the Company acknowledge and agree that the Severance Date is [_____], 20[_], and that Executive’s employment with the Company and any Affiliates is terminated as of the Severance Date. The Executive, the Company and the Parent agree that Executive is entitled to the compensation [and benefits] set forth in Section [_]1 of the Agreement (the “Severance Benefits”). Pursuant to Section 5.4 of Agreement, payment of the Severance Benefits is subject to the Executive’s execution and, if applicable, non-revocation of this Termination Release and is due pursuant to the terms described in the Agreement. If a revocation period is required by applicable law, no payment pursuant to Section 5.3 of the Agreement will be due sooner than eight (8) days following the date that Executive executes this Termination Release. |
1 Note to Draft: To be finalized dependent on qualifying termination reason.
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| 2. | GENERAL RELEASE BY EXECUTIVE. |
| a. | Except as set forth in Section 2(b) below, the Executive knowingly and voluntarily releases, acquits, covenants not to sue and forever discharges the Company, its Affiliates, and any of their respective past and present owners, parents, stockholders, predecessors, successors, assigns, agents, directors, officers, employees, representatives, divisions and subsidiaries (collectively, the “Releasees”) from any and all charges, complaints, claims, liabilities, obligations, promises, agreements, damages, causes of action, suits, rights, costs, losses, debts and expenses of any nature whatsoever, known or unknown, suspected or unsuspected, foreseen or unforeseen, matured or unmatured (collectively, the “Claims”), against them which the Executive or any of his heirs, executors, administrators, successors and assigns ever had, now has or at any time hereafter may have, own or hold by reason of any matter, fact, or cause whatsoever from the beginning of time up to and including the date of this Termination Release, including without limitation all claims for breach of implied or express contract, wrongful discharge, discrimination, retaliation, all tort claims, including unjust enrichment, quantum meruit, negligence, defamation, fraud, all claims for damages, interests, court costs, fees and expenses, all claims for punitive or exemplary damages, and all claims for attorneys’ fees, whether now known or unknown. This release of claims expressly includes all claims arising under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act of 1967, as amended, the Americans with Disabilities Act of 1990, the Family and Medical Leave Act of 1993, the Employee Retirement Income Security Act of 1974, Chapters 21 and 451 of the Texas Labor Code, each as amended, and any other federal, state or local laws, rules, regulations, judicial decisions or public policies now or hereafter recognized. Expressly excluded from this Termination Release are Claims which cannot be waived by law. |
| b. | The Executive represents that he has not filed or permitted to be filed against any of the Releasees, any complaints, charges or lawsuits and covenants and agrees that he will not seek or be entitled to any personal recovery in any court or before any governmental agency, arbitrator or self-regulatory body against any of the Releasees arising out of any matters set forth in Section 2(a) hereof. Nothing herein shall prevent the Executive from seeking to enforce his rights under the Agreement, including without limitation, the Executive’s right to receive his Accrued Obligations, Severance Payment, Pro-Rata Bonus and Other Benefits, in each case, at the time specified in the Agreement. The Executive does not hereby waive or release his rights to any benefits under the Company’s employee benefit plans to which he is or will be entitled pursuant to the terms of such plans in the ordinary course. In addition, nothing herein releases or otherwise waives any rights to the Executive’s: (i) final paycheck; (ii) reimbursement of any outstanding business expense amounts (in accordance with the Agreement and the Company’s business expense reimbursement policies); and (iii) applicable Consolidated Omnibus Budget Reconciliation Act or similar state law benefits under the Company’s standard benefit programs, if any. |
| c. | The Executive recognizes and understands that this Termination Release does not prohibit the Executive from filing an administrative charge with any state or federal agency, including the Equal Employment Opportunity Commission (“EEOC”). The Executive further recognizes and understands that even if the Executive files a charge with an administrative agency, or one is filed on the Executive’s behalf, the Executive waives any right to any relief of any kind should the administrative agency pursue a claim on Employee’s behalf. Notwithstanding any other provision of this Termination Release, the Executive further understands and agrees that: (a) the Executive is not in any way prohibited from reporting information to, or participating in any investigation or proceeding conducted by, the EEOC, the Securities and Exchange Commission (“SEC”) or any other federal, state, or local governmental agency or entity; (b) the Executive is not in any way precluded from providing truthful testimony in response to a valid subpoena, court order, or regulatory request; and (c) nothing in this Termination Release limits the Executive’s right to receive an award for information provided to the SEC. |
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| 3. | ADEA RELEASE BY EXECUTIVE. The Executive hereby completely and forever releases and irrevocably discharges the Releasees, from any and all Claims arising under the Age Discrimination in Employment Act, as amended (“ADEA”) on or before the date the Executive signs this Termination Release (the “ADEA Release”), and hereby acknowledges and agrees that: (i) this Termination Release, including the ADEA Release, was negotiated at arm’s length and the Executive has had the opportunity to confer with counsel of his choosing regarding this Termination Release; (ii) this Termination Release, including the ADEA Release, is worded in a manner that the Executive fully understands; (iii) the Executive specifically waives any rights or claims under the ADEA; (iv) the Executive knowingly and voluntarily agrees to all of the terms set forth in this Termination Release, including the ADEA Release; (v) the Executive acknowledges and understands that any claims under the ADEA that may arise after the date of this Termination Release are not waived; and (vi) the rights and claims waived in this Termination Release, including the ADEA Release, are in exchange for consideration over and above anything to which the Executive was already entitled. |
| 4. | GENERAL RELEASE BY COMPANY. The Company and its Affiliates each do hereby fully, finally and completely release Executive from any and all Claims of any kind or nature arising out of the Executive’s employment with the Company arising from, relating to, or in any way connected with any facts or events occurring on or before the date of this Termination Release; provided, however, that the Executive is not released or discharged from: (i) any Claim arising out of the Executive’s fraudulent, willful, or grossly negligent act or omission; or (ii) his continuing obligations contained in this Termination Release, the Agreement, or in any other agreement with the Company. |
| 5. | REAFFIRMATION OF CONTINUING OBLIGATIONS. Nothing in this Termination Release shall be deemed to affect or relieve the Executive from any continuing obligation contained in any other agreement with the Company or the Company’s rights with respect thereto. The Executive specifically acknowledges and reaffirms the post-termination obligations set forth in Section 6 of the Agreement, including continuing confidentiality, non-disclosure, non-disparagement, non-competition and non-solicitation obligations to the Company under the Agreement (collectively, the “Continuing Obligations”). The Executive further acknowledges that this reaffirmation is material to this Termination Release, and the Executive acknowledges and agrees that the Continuing Obligations are reasonable and enforceable and that he will not challenge or violate these covenants. |
| 6. | ARBITRATION. The Executive understands and agrees that the arbitration requirements set forth in Section 16 of the Agreement remain in full force and effect following the Severance Date and the execution of this Termination Release. Any claims arising out of or under this Termination Release or related to this Termination Release are subject to arbitration pursuant to Section 16 of the Agreement. |
| 7. | MODIFICATION; WAIVER. No modification or addition hereto or waiver or cancellation of any provision hereof shall be valid except by a writing signed by the party to be charged therewith. No delay on the part of any party to this Termination Release in exercising any right or privilege provided hereunder or by law shall impair, prejudice or constitute a waiver of such right or privilege. |
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| 8. | SEVERABILITY. If any provision contained in this Termination Release is determined to be void, illegal or unenforceable, in whole or in part, then the other provisions contained herein shall remain in full force and effect as if the provision which was determined to be void, illegal or unenforceable had not been contained herein. |
| 9. | COSTS. The parties hereto agree that each party shall pay its respective costs, including attorney’s fees, if any, associated with the negotiation, execution and delivery of this Termination Release. |
| 10. | FULLY UNDERSTOOD; PAYMENTS RECEIVED. By signing this Termination Release, the Executive acknowledges and affirms that he has read and understands the foregoing Termination Release, agrees to the terms of this Termination Release, and acknowledges receipt of a copy of this Termination Release. The Executive also hereby acknowledges and affirms the sufficiency of the compensation and severance amounts set forth in the Agreement. The Executive further acknowledges that upon receipt of the compensation and severance amounts set forth in the Agreement, he shall not be entitled to any further payment, compensation or remuneration of any kind from the Company, with respect to the Executive’s employment with the Company. |
| 11. | ENTIRE AGREEMENT. This Termination Release contains the entire agreement between the Executive, the Company and the Parent and supersedes any and all prior understandings or agreements with respect to the subject matter hereof, whether written or oral, except as set forth herein and with respect to any of the Executive’s continuing obligations contained in the Agreement, which shall continue and remain in full force and effect per the terms of those covenants. |
| 12. | ACKNOWLEDGMENT. The Company has advised the Executive to consult with an attorney of his choosing prior to signing this Termination Release and the Executive hereby represents to the Company that he has been offered an opportunity to consult with an attorney prior to signing this Termination Release. The Company has also advised the Executive that Executive has up to [twenty-one (21) days] [forty-five (45) days] to consider and sign the Termination Release and up to seven (7) days after signing in which to revoke acceptance by giving notice to [__________] at [__________________] by personal delivery or by mail postmarked no later than the seventh (7th) day after the Executive signs the Termination Release. The Executive acknowledges and agrees that any changes in the terms of this Termination Release, whether material or immaterial, after the date upon which the Executive first received this Termination Release shall not affect or restart the above-referenced [twenty-one (21)-day] [forty-five (45)-day] consideration period. |
[Signature Page Follows]
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IN WITNESS WHEREOF, and intending to be legally bound hereby, the parties hereto have executed this Termination Release under seal as of the day and year first above written.
| “COMPANY” | |||
| BHR LUXURY HOTELS MANAGEMENT, LLC, | |||
| a Texas limited liability company | |||
| By: | Braemar Hospitality Limited Partnership, a Delaware limited partnership | ||
| Sole Member | |||
| By: | Braemar OP General Partner LLC, | ||
| a Delaware limited liability company | |||
| General Partner | |||
| By: | |||
| Name: | |||
| Title: | |||
| “PARENT” | ||
| BRAEMAR HOTELS & RESORTS INC. | ||
| a Maryland corporation | ||
| By: | ||
| Name: | ||
| Title: | ||
| “EXECUTIVE” | |
| Robert G. Haiman |
A-5
Exhibit 14.1
BRAEMAR HOTELS &
RESORTS INC.
CODE OF BUSINESS CONDUCT AND ETHICS
Braemar Hotels & Resorts Inc. (together with its subsidiaries, the “Company”) has adopted this Code of Business Conduct and Ethics (the “Code”). This Code applies to every director of the Company and every officer (including our chief executive officer (the “CEO”), chief legal officer and chief financial officer, or their respective successors, as appropriate) and employee (if any). For purposes of this Code, the term officers and employees includes all individuals who are employed directly by the Company, or who have been named an officer of the Company by the board of directors of the Company (the “Board”).
We have established this Code to further the Company’s fundamental principles of honesty, loyalty, fairness and forthrightness. Our Code strives to deter wrongdoing and promote the following six objectives:
| 1. | Honest and ethical conduct; |
| 2. | Full, fair, accurate, timely and understandable disclosure of information in reports and documents filed with the Securities and Exchange Commission (the “SEC”) and other public communications; |
| 3. | Compliance with the applicable governmental and self-regulatory organization laws, rules and regulations; |
| 4. | Deterrence of wrongdoing and prompt internal reporting of Code violations; |
| 5. | Protection of Company assets, including corporate opportunities and confidential information; and |
| 6. | Accountability for compliance with the Code. |
Below, we discuss situations that require application of our fundamental principles and promotion of our objectives. If there is a conflict between this Code and a specific procedure you should consult the Chief Legal Officer for guidance.
ACCOUNTABILITY FOR COMPLIANCE WITH THE CODE
Each of the directors, officers and employees is expected to:
Understand. The Company expects YOU to understand the requirements of your position including Company expectations and governmental rules and regulations that apply to your position.
Comply. The Company expects YOU to comply with this Code and all applicable laws, rules and regulations and to further promote high standards of integrity by conducting all corporate affairs honestly and ethically.
Report. The Company expects YOU to report any violation of this Code of which you become aware.
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Be Accountable. The Company holds YOU accountable for complying with the Code.
ACCOUNTING POLICIES
The Company will make and keep books, records and accounts, which in reasonable detail accurately and fairly present the transactions and disposition of the assets of the Company to promote full, fair, accurate, timely and understandable disclosure.
All directors, officers and employees are prohibited from directly or indirectly falsifying or causing to be false or misleading any financial or accounting book, record or account. You and others are expressly prohibited from directly or indirectly manipulating an audit, and from destroying or tampering with any record, document or tangible object with the intent to obstruct a pending or contemplated audit, review or federal investigation. The commission of, or participation in, one of these prohibited activities or other illegal conduct will subject the perpetrator to federal penalties, as well as punishment of up to and including termination of employment.
No director, officer or employee may directly or indirectly:
| 1. | make or cause to be made a materially false or misleading statement regarding the business or the Company; or |
| 2. | omit to state, or cause another person to omit to state, any material fact necessary to make statements made not misleading in connection with the audit of financial statements by independent accountants, the preparation of any required reports whether by independent or internal accountants, or any other work which involves or relates to the filing of a document with the SEC. |
AMENDMENTS AND MODIFICATIONS OF THIS CODE
There shall be no amendment or modification to this Code except by approval of the Board or a designated Board committee that will ascertain whether an amendment or modification is appropriate
In case of any amendment or modification of this Code that applies to an executive officer or director of the Company, the amendment or modification shall be posted on the Company’s Internet website within five (5) business days of the Board approval or shall be otherwise disclosed as required by applicable law or New York Stock Exchange rules. Notice posted on the website shall remain there for a period of twelve (12) months and shall be retained in the Company’s files as required by law.
ANONYMOUS REPORTING
If you wish to report a suspected violation of this Code anonymously, you may call the Company’s Anonymous Reporting Hotline at [____________] for domestic calls, and [___________] for international calls. The Company will not disclose the identity of any employee who reports a violation of this Code without his or her permission, unless disclosure is unavoidable during an investigation.
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ANTI-BOYCOTT AND U.S. SANCTIONS LAWS
We must comply with anti-boycott laws, which prohibit the Company from participating in, and require us to report to the authorities any request to participate in, a boycott of a country or businesses within a country. If you receive such a request, report it to the Company’s Chief Legal Officer. We will also not engage in business with any government, entity, organization or individual where doing so is prohibited by applicable laws. For more information on these laws contact the Chief Legal Officer.
ANTITRUST AND FAIR COMPETITION LAWS
The purpose of antitrust laws in the United States and most other countries is to provide a level playing field to economic competitors and to promote fair competition. No director, officer or employee, under any circumstances or in any context, may enter into any understanding or agreement, whether express or implied, formal or informal, written or oral, with an actual or potential competitor, which would illegally limit or restrict in any way either party’s actions, including the offers of either party to any third party. This prohibition includes any action relating to prices, costs, profits, products, services, terms or conditions of sale, market share or customer or supplier classification or selection.
It is our policy to comply with all U.S. antitrust laws. This policy is not to be compromised or qualified by anyone acting for or on behalf of the Company. You must understand and comply with the antitrust laws as they may bear upon your activities and decisions. Anti-competitive behavior in violation of antitrust laws can result in criminal penalties, both for the individual involved and for the Company. Accordingly, any question regarding compliance with antitrust laws or your responsibilities under this policy should be directed to the Chief Legal Officer. Any director, officer or employee found to have knowingly participated in violating the antitrust laws will be subject to disciplinary action, up to and including termination of employment.
Below are some scenarios that are prohibited and scenarios that could be prohibited for antitrust reasons. These scenarios are not an exhaustive list of all prohibited and possibly prohibited antitrust conduct. When in doubt about any situation, whether it is discussed below or not, you should consult with the Chief Legal Officer.
The following scenarios are prohibited for antitrust or anti-competition reasons:
| 1. | Proposals or execution of any agreements or understanding -- express or implied, formal or informal, written or oral -- with any competitor regarding any aspect of competition between the Company and the competitor for sales to third parties. |
The following business arrangements could raise anti-competition or antitrust law issues. Before entering into them, you must consult with the Chief Legal Officer:
| 1. | Exclusive arrangements for the purchase or sale of products or services. |
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| 2. | Bundling of goods and services. |
| 3. | Technology licensing agreements that restrict the freedom of the licensee or licensor. |
| 4. | Agreements to add a Company employee to another entity’s Board of Directors. |
BRIBERY
You are strictly forbidden from offering, promising, or giving money, gifts, loans, rewards, favors or anything of value to any governmental official, employee, agent or other intermediary (either inside or outside the United States) which is prohibited by law. Those paying a bribe may subject the Company and themselves to civil and criminal penalties. When dealing with government customers or officials, no improper payments will be tolerated. If you receive any offer of money or gifts that is intended to influence a business decision, then it should be reported to your supervisor or the Chief Legal Officer immediately.
The Company prohibits improper payments in all of its activities, whether these activities are with governments or in the private sector.
COMPLIANCE WITH LAWS, RULES AND REGULATIONS
The Company’s goal and intention is to comply with the laws, rules and regulations by which we are governed. In fact, we strive to comply not only with requirements of the law but also with recognized compliance practices. All illegal activities or illegal conduct are prohibited whether or not they are specifically set forth in this Code.
Directors, officers and employees shall comply, both in letter and spirit, with all applicable laws, rules and regulations in the cities, states and countries in which the Company operates. While not all employees, officers and directors are expected to know the details of all applicable laws, rules and regulations, it is important to know enough to determine when to seek advice from appropriate personnel. Questions about compliance should be addressed to the Chief Legal Officer.
Where law does not govern a situation or where the law is unclear or conflicting, you should discuss the situation with your supervisor, and management should seek advice from the Chief Legal Officer. Business should always be conducted in a fair and forthright manner. Directors, officers and employees are expected to act according to high ethical standards.
COMPUTER AND INFORMATION SYSTEMS
For business purposes, officers and employees are provided telephones and computer workstations and software, including network access to computing systems such as the Internet and e-mail, to improve personal productivity and to efficiently manage proprietary information in a secure and reliable manner. You must obtain the permission from the Information Technology Services Department to install any software on any Company computer or connect any personal laptop to the Company network. As with other equipment and assets of the Company, we are each responsible for the appropriate use of these assets. Officers and employees should not expect a right to privacy of their e-mail. All e-mails on Company equipment are subject to monitoring by the Company.
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CONFIDENTIAL INFORMATION BELONGING TO OTHERS
You must respect the confidentiality of information, including, but not limited to, trade secrets and other information given in confidence by others, including but not limited to partners, suppliers, contractors, competitors or customers, just as we protect our own confidential information. However, certain restrictions about the information of others may place an unfair burden on the Company’s future business. For that reason, directors, officers and employees should coordinate with the Chief Legal Officer to ensure appropriate agreements are in place prior to receiving any confidential third-party information. These agreements must reflect a balance between the value of the information received and the logistical and financial costs involved in both maintaining confidentiality of the information and also limiting the Company’s business opportunities. In addition, any confidential information that you may possess from an outside source, such as a previous employer, must not, so long as such information remains confidential, be disclosed to or used by the Company. Unsolicited confidential information submitted to the Company should be refused, returned to the sender where possible and deleted, if received via the Internet.
CONFIDENTIAL AND PROPRIETARY INFORMATION
It is the Company’s policy to ensure that all operations, activities and business affairs of the Company and our business associates are kept confidential to the greatest extent possible. Confidential information includes all non-public information that might be of use to competitors, or that might be harmful to the Company or its customers, if disclosed. Confidential and proprietary information about the Company or its business associates belongs to the Company, must be treated with strictest confidence and is not to be disclosed or discussed with others except when disclosure is authorized by the Company or is legally mandated.
Unless otherwise agreed to in writing, confidential and proprietary information includes any and all methods, inventions, improvements or discoveries, whether or not patentable or copyrightable, and any other information of a similar nature disclosed to the directors, officers or employees of the Company or otherwise made known to us as a consequence of or through employment or association with the Company (including information originated by the director, officer or employee). This can include, but is not limited to, information regarding the Company’s business, products, processes, and services. It also can include information relating to research, development, inventions, trade secrets, intellectual property of any type or description, data, business plans, marketing strategies, engineering, contract negotiations, and business methods or practices.
The following are examples of information that is not considered confidential:
| · | Information that is in the public domain to the extent such information is readily available. |
| · | Information that becomes generally known to the public other than by disclosure by the Company or a director, officer or employee of the Company. |
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| · | Information you receive from a party, which is under no legal obligation of confidentiality with the Company with respect to such information. |
We have exclusive property rights to all confidential and proprietary information regarding the Company or our business associates. The unauthorized disclosure of this information could destroy its value to the Company and give others an unfair advantage. You are responsible for safeguarding Company information and complying with established security controls and procedures. All documents, records, notebooks, notes, memoranda and similar repositories of information containing information of a secret, proprietary, confidential or generally undisclosed nature relating to the Company or our operations and activities made or compiled by the director, officer or employee or made available to you prior to or during the term of your association with the Company, including any copies thereof, unless otherwise agreed to in writing, belong to the Company and shall be held by you in trust solely for the benefit of the Company, and shall be delivered to the Company by you on the termination of your association with us or at any other time we request.
CONFLICTS OF INTEREST
Conflicts of interest can arise in virtually every area of our operations. A “conflict of interest” exists whenever an individual’s private interests interfere or conflict in any way with the interests of the Company. We must strive to avoid conflicts of interest. We must each make decisions solely in the best interest of the Company. Any business, financial or other relationship with suppliers, customers or competitors that might impair or appear to impair the exercise of our judgment solely for the benefit of the Company is prohibited.
Here are some examples of actual or apparent conflicts of interest:
Family Members. Actions of family members may create a conflict of interest. For example, gifts to family members by a supplier of the Company are considered gifts to you and must be reported. Doing business for the Company with organizations where your family members are employed or which are partially or fully owned by your family members or close friends may create a conflict or the appearance of a conflict of interest. For purposes of the Code, “family members” includes any child, stepchild, grandchild, parent, stepparent, grandparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in-law, and adoptive relationships.
Gifts, Entertainment, Loans, or Other Favors. Directors, officers and employees shall not seek or accept personal gain, directly or indirectly, from anyone soliciting business from, or doing business with the Company, or from any person or entity in competition with us. Examples of such personal gains are gifts, non-business-related trips, gratuities, favors, loans, and guarantees of loans, excessive entertainment or rewards. However, you may accept gifts of a nominal value. Other than common business courtesies, directors, officers, employees and independent contractors must not offer or provide anything to any person or organization for the purpose of influencing the person or organization in their business relationship with us.
Directors, officers and employees are expected to deal with advisors or suppliers who best serve the needs of the Company as to price, quality and service in making decisions concerning the use or purchase of materials, equipment, property or services. Directors, officers and employees who use the Company’s advisors, suppliers or contractors in a personal capacity are expected to pay market value for materials and services provided.
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Outside Employment. Officers and employees may not participate in outside employment, self-employment, or serve as officers, directors, partners or consultants for outside organizations, if such activity:
| 1. | reduces work efficiency; |
| 2. | interferes with your ability to act conscientiously and in our best interest; or |
| 3. | requires you to utilize our proprietary or confidential procedures, plans or techniques. |
You must inform your supervisor of any outside employment, including the employer’s name and expected work hours.
Reporting Conflicts of Interest or Potential Conflicts of Interest. You should report any actual or potential conflict of interest involving yourself or others of which you become aware to your supervisor or the Chief Legal Officer. Officers should report any actual or potential conflict of interest involving yourself or others of which you become aware to the Chief Legal Officer, or to the Chairman of the Nominating and Corporate Governance Committee of the Board. Directors should report any actual or potential conflict of interest involving yourself or others of which you become aware to the Chairman of the Nominating and Corporate Governance Committee of the Board.
CORPORATE COMMUNICATIONS
See INVESTOR RELATIONS AND PUBLIC AFFAIRS.
CORPORATE OPPORTUNITIES AND PROTECTION AND PROPER USE OF COMPANY ASSETS
You are prohibited from:
| 1. | taking for yourself, personally (or for the benefit of friends or family members), opportunities that are discovered through the use of Company property, information or position; |
| 2. | using Company property, information or position for personal gain (including gain of friends or family members); or |
| 3. | competing with the Company. |
You have a duty to the Company to advance its legitimate interests when the opportunity to do so arises.
You are personally responsible and accountable for the proper expenditure of Company funds, including money spent for travel expenses or for customer entertainment. You are also responsible for the proper use of property over which you have control, including both Company property and funds and property that customers or others have entrusted to your custody. Company assets must be used only for proper purposes.
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Company property should not be misused. Company property shall not be sold, loaned or given away regardless of condition or value, without proper authorization. Each director, officer and employee should protect our assets and ensure their efficient use. Theft, carelessness and waste have a direct impact on the Company’s profitability and are prohibited. All of our assets should be used only for legitimate business purposes.
DISCIPLINE FOR NONCOMPLIANCE WITH THIS CODE
Disciplinary actions for violations of this Code can include oral or written reprimands, suspension or termination of employment or a potential civil lawsuit against you.
The violation of laws, rules or regulations, which can subject the Company to fines and other penalties, may result in your criminal prosecution.
DISCLOSURE POLICIES AND CONTROLS
The continuing excellence of the Company’s reputation is dependent upon our full and complete disclosure of important information about the Company that is used in the securities marketplace. Our financial and non-financial disclosures and filings with the SEC must be transparent, accurate and timely. Proper reporting of reliable, truthful and accurate information is a complex process involving cooperation between many departments and disciplines. We must all work together to insure that reliable, truthful and accurate information is disclosed to the public.
The Company shall disclose to the SEC, current security holders and the investing public information that is required, and any additional information that may be necessary to ensure the required disclosures are not misleading or inaccurate. The Company requires you to participate in the disclosure process, which is overseen by the CEO and the Chief Legal Officer, in consultation with the Audit Committee. The disclosure process is designed to record, process, summarize and report material information as required by all applicable laws, rules and regulations. Participation in the disclosure process is a requirement of a public company, and full cooperation and participation by members of the Audit Committee, CEO, the Chief Legal Officer, and, upon request, other employees in the disclosure process is a requirement of this Code.
Officers and employees must fully comply with their disclosure responsibilities in an accurate and timely manner or be subject to discipline of up to and including termination of employment.
ENVIRONMENT, HEALTH AND SAFETY
The Company is committed to managing and operating our assets in a manner that is protective of human health and safety and the environment. It is our policy to comply, in all material respects, with applicable health, safety and environmental laws and regulations. Each employee is also expected to comply with our policies, programs, standards and procedures. Please see related procedures in the Company’s Employee Handbook.
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FAIR DEALING WITH OTHERS
Each employee, officer and director should endeavor to deal fairly with the Company’s customers, suppliers, competitors and employees. No director, officer or employee should take unfair advantage of anyone through manipulation, concealment, abuse of privileged information, misrepresentation of material facts or any other unfair-dealing practice.
FILING OF GOVERNMENT REPORTS
Any reports or information provided, on our behalf, to federal, state, local or foreign governments should be true, complete and accurate. Any omission, misstatement or lack of attention to detail could result in a violation of the reporting laws, rules and regulations.
FOREIGN CORRUPT PRACTICES ACT
The United States Foreign Corrupt Practices Act prohibits giving anything of value, directly or indirectly, to foreign government officials or foreign political candidates in order to obtain, retain or direct business. Accordingly, corporate funds, property or anything of value may not be, directly or indirectly, offered or given by you or an agent acting on our behalf, to a foreign official, foreign political party or official thereof or any candidate for a foreign political office for the purpose of influencing any act or decision of such foreign person or inducing such person to use his influence or in order to assist in obtaining or retaining business for, or directing business to, any person.
You and our agents are also prohibited from offering or paying anything of value to any foreign person if it is known or there is a reason to know that all or part of such payment will be used for the above-described prohibited actions. This provision includes situations when intermediaries, such as affiliates, or agents, are used to channel payoffs to foreign officials.
The Foreign Corrupt Practices Act also contains significant internal accounting control and record-keeping requirements that apply to the Company’s domestic and international operations. For more information on the Foreign Corrupt Practices Act, please consult the Chief Legal Officer.
INSIDER TRADING OR STOCK TIPPING
Directors, officers and employees who are aware of material, non-public information (an “Insider”) from or about the Company, are not permitted, directly or through family members or other persons or entities, to:
| 1. | buy or sell securities (or derivatives relating to such securities) of the Company, including transfers in or out of the Company stock funds in the Employee Savings Plan (other than pursuant to a pre-approved trading plan that complies with the SEC Rule 10b5-1); or |
| 2. | pass on, tip or disclose material, non-public information to third parties outside the Company. |
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Such buying, selling or trading of securities may be punished by discipline of up to and including termination of employment; civil actions, including penalties of up to three times the amount of profit gained or loss avoided by the inside trade or stock tip; or criminal actions, including jail time.
For more detailed information about the Company’s prohibition on insider trading and stock tipping, please refer to the Company’s Policy on Insider Trading and Compliance, which all directors, officers and employees of the Company are required to review and acknowledge on an annual basis.
Trades Following Disclosure. When material information has been publicly disclosed, each Insider must continue to refrain from buying or selling the securities in question until thethird business day after the information has been publicly released to allow the markets time to absorb the information.
INTELLECTUAL PROPERTY: PATENTS, COPYRIGHTS AND TRADEMARKS
Except as otherwise agreed to in writing between the Company and an officer or employee, all intellectual property you conceive or develop during the course of your employment, related in any way to the past, present and prospective activities of the Company, shall be the sole property of the Company. The term “intellectual property” includes any invention, discovery, concept, idea, or writing whether protectable or not by any United States or foreign copyright, trademark, patent, or common law including, but not limited to designs, materials, compositions of matter, machines, manufactures, processes, improvements, data, computer software, writings, formula, techniques, know-how, methods, as well as improvements thereof or know-how related thereto concerning any past, present or prospective activities of the Company. Officers and employees must promptly disclose in writing to the Company any intellectual property developed or conceived either solely or with others during the course of your employment concerning any past, present or prospective activities of the Company and must render any and all aid and assistance, at our expense to secure the appropriate patent, copyright, or trademark protection for such intellectual property.
Works of authorship including literary works such as books, articles, and computer programs; musical works, including any accompanying words; dramatic works, including any accompanying music; pantomimes and choreographic works; pictorial, graphic, and sculptural works; motion pictures and other audiovisual works; sound recordings; and architectural works are protected by United States and foreign copyright law as soon as they are reduced to a tangible medium perceptible by humans with or without the aid of a machine. A work does NOT have to bear a copyright notice in order to be protected and without the copyright owner’s permission, no one may make copies of the work, create derivative works, distribute the work, perform the work publicly, or display the work publicly.
Copyright laws may protect items posted on a website. Unless a website grants permission to download the Internet content you generally only have the legal right to view the content. If you do not have permission to download and distribute specific website content you should contact the Chief Legal Officer.
If you are unclear as to the application of this Intellectual Property Policy or if questions arise, please consult with the Chief Legal Officer.
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INVESTOR RELATIONS AND PUBLIC AFFAIRS
It is very important that the information disseminated about the Company be both accurate and consistent. For this reason, the Investor Relations Department of the Advisor, in consultation with the Legal Department of the Advisor, is responsible for the Company’s external communications, including all communications with stockholders, analysts and other interested members of the financial community as well as communications with the media, local communities and government officials. Only authorized executive officers can serve as the spokesperson of the Company in either routine or crisis situations.
NON-RETALIATION FOR REPORTING
In no event will the Company take or threaten any action against you as a reprisal or retaliation for making a complaint or disclosing or reporting information in good faith. However, if a reporting individual was involved in improper activity, the individual may be appropriately disciplined even if he or she was the one who disclosed the matter to the Company. In these circumstances, the Company may consider the conduct of the reporting individual in promptly reporting the information as a mitigating factor in any disciplinary decision.
The Company will not allow retaliation against an employee for reporting a possible violation of any laws, rules, regulations or this Code in good faith. Retaliation for reporting a federal offense is illegal under federal law and prohibited under this Code. Retaliation for reporting any violation of a law, rule or regulation or a provision of this Code is prohibited. Retaliation will result in discipline up to and including termination of employment and may also result in criminal prosecution.
POLITICAL CONTRIBUTIONS
You shall refrain from making any use of Company, personal or other funds or resources on behalf of the Company for political or other purposes which are improper or prohibited by the applicable federal, state, local or foreign laws, rules or regulations. Company contributions or expenditures in connection with election campaigns will be permitted where allowed by federal, state, local or foreign election laws, rules and regulations.
You are encouraged to participate actively in the political process. We believe that individual participation is a continuing responsibility of those who live in a free state.
PROHIBITED SUBSTANCES
We have policies prohibiting the use of alcohol, illegal drugs or other prohibited items, including legal drugs which affect the ability to perform one’s work duties, while on Company premises. The Company also prohibits you from reporting to work (including employees who work remotely) while under the influence of alcohol or illegal drugs. We also perform pre-employment and random drug testing on certain employees. For the procedures on prohibited substances you should see the Company’s Employee Handbook.
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RECORD RETENTION
We have a document retention policy to establish retention periods for records created or received in the normal course of business. A record is information, regardless of physical format, which has been created or received in the transaction of the Company’s business. Physical format of a record includes hard copy, electronic, magnetic tape, disk, audio, video, optical image, etc. Each corporate department and division office is responsible for the maintenance, retrieval, transfer, and destruction of its records in accordance with the established filing procedures, records retention schedules and procedures.
The alteration, destruction or falsification of corporate documents or records may constitute a criminal act. Destruction or alteration of documents with the intent to obstruct a pending or anticipated official government proceeding is a criminal act and could result in large fines and a prison sentence of up to twenty (20) years. Document destruction or falsification in other contexts can result in a violation of the federal securities laws or the obstruction of justice laws.
Before any destruction of any documents or records, you must consult the procedures adopted by the Company. You are required to review, follow and abide by the terms of this policy and related procedures. If the policy or procedure is not clear, questions arise, or there is a pending or anticipated official proceeding, then the Chief Legal Officer must approve any document destruction.
RELATIONS AMONG EMPLOYEES: RESPECT AND CONTRIBUTION
We function as a team. Your success as part of this team depends on your contribution and ability to inspire the trust and confidence of your coworkers and supervisors. Respect for the rights and dignity of others and a dedication to the good of our Company are essential.
A cornerstone of the Company’s success is the teamwork of its directors, officers and employees. We must each respect the rights of others while working as a team to fulfill our objectives. To best function as part of a team, you must be trustworthy and dedicated to high standards of performance. The relationships between business groups also require teamwork.
To facilitate respect and contribution among employees, we have implemented the following employment policies:
| 1. | To hire, pay and assign work on the basis of qualifications and performance; |
| 2. | Not to discriminate on the basis of race, religion, ethnicity, national origin, color, gender, sexual orientation, age, citizenship, veteran’s status, marital status or disability; |
| 3. | To attract and retain a highly talented workforce; |
| 4. | To encourage skill growth through training and education and promotional opportunities; |
| 5. | To encourage an open discussion between all levels of employees and to provide an opportunity for feedback from the top to the bottom and from the bottom to the top; |
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| 6. | To prohibit any sexual, physical, verbal or any other kind of harassment by others while an employee is on the job; |
| 7. | To make the safety and security of our employees while at Company facilities a priority; |
| 8. | To recognize and reward additional efforts that go beyond our expectations; and |
| 9. | To respect all workers’ rights to dignity and personal privacy by not disclosing employee information, including protected health information, unnecessarily. |
REPORTING OF CODE VIOLATIONS OR
OTHER ILLEGAL OR UNETHICAL BEHAVIOR
You should be alert and sensitive to situations that could result in actions that might violate federal, state, or local laws or the standards of conduct set forth in this Code. If you believe your own conduct or that of a fellow employee may have violated any such laws or this Code, you have an obligation to report the matter.
Generally, you should raise such matters first with an immediate supervisor. However, if you are not comfortable bringing the matter up with your immediate supervisor, or do not believe the supervisor has dealt with the matter properly, then you should raise the matter with an executive officer or, if a law, rule or regulation is in question, then consult with the Chief Legal Officer. The most important point is that possible violations should be reported and we support all means of reporting them.
Directors and officers should report any potential violations of this Code to the Chief Legal Officer or the Audit Committee of the Board.
ENFORCEMENT
The Company must ensure prompt and consistent action against violations of this Code.
If, after investigating a report of an alleged prohibited action by any other person, the relevant supervisor determines that a violation of this Code has occurred, such supervisor will report such determination to the Chief Legal Officer.
If, after investigating a report of an alleged prohibited action by a director or executive officer, the Audit Committee determines that a violation of this Code has occurred, then such committee will report such determination to the full Board.
Upon receipt of a determination that there has been a violation of this Code, the Company will take such preventative or disciplinary action as it deems appropriate, up to and including termination of employment and, in the event of criminal conduct or other serious violations of the law, notification of appropriate governmental authorities.
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WAIVERS
There shall be no waiver of any part of this Code for any director or executive officer except by approval of the Board or a designated board committee that will ascertain whether a waiver is appropriate under all the circumstances. In case a waiver of this Code is granted to a director or officer, the notice of such waiver shall be posted on our website at www.bhrreit.com within four (4) business days of the Board’s or designated board committee’s vote or shall be otherwise disclosed as required by applicable law or New York Stock Exchange or SEC rules. Notices posted on our website shall remain there for a period of twelve (12) months and shall be retained in our files for not less than five (5) years or as otherwise required by law. A waiver for a specific event arising under the “Conflicts of Interest” section of this Code may be granted to an employee who is not a director or executive officer on the approval of the two (2) following officers: the Chief Legal Officer and the CEO. No other waivers of this Code are permitted.
CONCLUSION
This Code is an attempt to point all of us at the Company in the right direction, but no document can achieve the level of principled compliance that we are seeking. In reality, each of us must strive every day to maintain our awareness of these issues and to comply with the Code’s principles to the best of our abilities. We must always ask:
| · | Does it feel right? |
| · | Is this action ethical in every way? |
| · | Is this action in compliance with the law? |
| · | Could my actions create an appearance of impropriety? |
| · | Am I trying to fool anyone, including myself, about the propriety of this action? |
We cannot expect perfection, but we do expect diligence and good faith. If you act in bad faith or fail to report illegal or unethical behavior, then you will be subject to disciplinary procedures. We hope that you agree that the best course of action is to be honest, forthright and loyal at all times.
Last Amended: November 2026
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ACKNOWLEDGMENT OF RECEIPT AND REVIEW1
I, , acknowledge that I have received and read a copy of the Braemar Hotels & Resorts Inc. Code of Business Conduct and Ethics. I understand the contents of the Code, and I agree to comply with the policies and procedures set out in the Code. I understand that I should approach the Chief Legal Officer if I have any questions about the Code generally or any questions about reporting a suspected violation of the Code.
| [NAME] | |
| [PRINTED NAME] | |
| [DATE] |
1 To be signed and returned to the Chief Legal Officer or his successor.
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Exhibit 14.2
BRAEMAR HOTELS & RESORTS INC.
CODE OF ETHICS FOR THE
CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER
Braemar Hotels & Resorts Inc. (together with its subsidiaries, the “Company”) has adopted this Code of Ethics (the “Code”) for the chief executive officer (“CEO”) and chief financial officer (“CFO”) of the Company or their respective successors.
This Code is intended to comply with the provisions of Section 406 of the Sarbanes-Oxley Act of 2002 and rules promulgated thereunder. The Board of Directors (the “Board”) of the Company may, from time to time, modify this Code as may be required to meet applicable law. In addition, the Company shall satisfy the requirements of Section 406 of the Sarbanes-Oxley Act of 2002 by making this Code publicly available by one of three alternative methods:
| 1. | Filing a copy as an exhibit to the Company’s annual report filed on Form 10-K. |
| 2. | Posting the text of this Code on the Company’s website with the intention to so disclose to be articulated in the Company’s annual report. |
| 3. | Making a copy of this Code available to any requesting person, without charge, provided that this option is also disclosed in the Company’s annual report. |
Any amendment to or waiver of this Code must be disclosed within four (4) business days by the filing of a Form 8-K.
Further, in an effort to provide accountability for adherence to the Code, the CEO and CFO shall certify their compliance hereunder from time to time as directed by the Board (by and through the Audit Committee) and as dictated by applicable law.
Under this Code, the CEO and CFO shall each follow the principles and responsibilities governing their respective conduct and ethics in performing their functions in their respective capacities as an officer of the Company, as stated below.
Principles and Responsibilities
| 1. | Act with honesty and integrity in representing the Company, and Avoid actual or apparent conflicts of interest in personal and professional relationships. A “conflict of interest” exists when an individual’s private interests, activities or ventures interfere, conflict or compete in any way with the interests of the Company. |
| 2. | Refrain from taking any opportunity that belongs to the Company. Such opportunities include those offered to the Company and those being sought out or developed by the Company through the use of Company assets, funds, property, information, facilities and/or personnel. |
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| 3. | Provide constituents with information that is accurate, complete, objective, relevant, timely and understandable in all instances, including without limitation, the Company’s filings with and other submissions to the Securities and Exchange Commission (the “SEC”). The CEO and CFO shall not create any false, artificial or misleading entry in the books and records of the Company or create, maintain or permit to exist any fund or asset that is not fully and properly recorded on the books and records of the Company and will immediately report any false, artificial or misleading entry, or any improperly recorded asset of which such person becomes aware. Each of the CEO and CFO shall review the annual and quarterly reports before certifying and filing them with the SEC. |
| 4. | Comply with all applicable laws, rules and regulations, including, but not limited to, the Foreign Corrupt Practices Act (the “FCPA”), insider trading laws, the New York Stock Exchange rules and regulations and other appropriate rules and regulations of private and public regulatory agencies. In accordance with the FCPA, no CEO or CFO will make or authorize any unlawful payments on behalf of himself or herself or the Company. |
| 5. | Act in good faith, responsibly, with due care, loyalty, competence and diligence, without misrepresenting material facts or allowing such officer’s independent judgment to be subordinated. |
| 6. | Respect the confidentiality of information acquired in the course of business except when authorized or otherwise legally obligated to disclose the information. Each of the CEO and CFO shall acknowledge that confidential and proprietary Company information acquired in the course of business is not to be used for personal advantage. |
| 7. | Proactively promote ethical behavior among employees at the Company and as a responsible partner with industry peers and associates. |
| 8. | Maintain control over and responsibly manage all assets and resources employed or entrusted to such officer by the Company. |
| 9. | Not unduly or fraudulently influence, coerce, manipulate or mislead any audit or interfere with any auditor engaged in the performance of an internal or independent audit of the Company’s financial statements or accounting books and records. |
| 10. | Report illegal or unethical conduct by any director, officer or employee that has occurred, is occurring or may occur, including without limitation, any potential violations of this Code or the Company’s Code of Business Conduct and Ethics including conduct of a financial or non-financial nature. Such violations shall be promptly reported to the Chief Legal Officer or the Nominating and Corporate Governance Committee of the Board. |
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| 11. | Comply with this Code and the Company’s Code of Business Conduct and Ethics. Each of the CEO and CFO acknowledge that if such officer shall violate any part of this Code or the Company’s Code of Business Conduct and Ethics, such officer will be subject to disciplinary action up to and including immediate termination. |
| 12. | This Code is subject to all applicable laws, rules and regulations. This Code incorporates by reference the Company’s Code of Business Conduct and Ethics that applies to all directors, officers and employees. |
| 13. | If there is a conflict between this Code and a Company policy or procedure, the Company’s Code of Business Conduct and Ethics, or any applicable law, rule or regulation, then the officer must consult with the Chief Legal Officer or the Nominating and Corporate Governance Committee for guidance. |
| 14. | There shall be no waiver of, modification of or change to any part of this Code except by approval of the Board or a designated Board committee. In the event that a waiver of, modification of and/or change to this Code is granted, then the notice of the waiver, modification and/or change shall be posted on the Company’s website within five (5) business days of the Board’s or designated Board committee’s approval or shall be disclosed as otherwise required by applicable law or New York Stock Exchange or SEC rules. Notices posted on the Company website shall remain there for a period of twelve (12) months and shall be retained in the Company’s files as required by law. |
Last Amended: November 2026
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Exhibit 99.1
NEWS RELEASE
Contacts:
Justin Coe
Chief Financial Officer
jcoe@bhrreit.com
Joe Germani / Miller Winston
Longacre Square Partners
Braemar@Longacresquare.com
BRAEMAR HOTELS & RESORTS ANNOUNCES TRANSITION TO SELF-MANAGED REIT
Announces Governance Updates and Files Preliminary Proxy Statement Naming Board Nominees
Luxury Portfolio Positioned to Capitalize on Strong Sector Fundamentals
DALLAS, November 10, 2026 – Braemar Hotels & Resorts Inc. (NYSE: BHR) (“Braemar” or the “Company”) today announced its transition to a self-managed REIT following the termination of its advisory agreement with Ashford Inc. and its affiliates (“Ashford”). The Company also announced updates to its corporate governance framework and that it has filed its preliminary proxy statement with the Securities and Exchange Commission (the “SEC”) in connection with its 2026 Annual Meeting of Stockholders (the “Annual Meeting”). Additional details regarding the termination are included in the Company’s Current Report on Form 8-K filed today.
“This transition marks the start of a new chapter for Braemar as a self-managed REIT,” said Richard J. Stockton, the Company’s President and Chief Executive Officer. “Our management team is now employed directly by the Company, we have updated our governance framework, and we have put forward a slate of director nominees, seven of whom are independent, with deep REIT, audit, governance and public company experience.”
Mr. Stockton continued, “Our luxury portfolio continues to perform. As we recently reported, the portfolio’s third-quarter Comparable RevPAR rose 14.4% and Comparable Hotel EBITDA grew 20.7%, led by our urban hotels, where Comparable RevPAR rose 23.3% and Comparable Hotel EBITDA rose 63.2%. Looking ahead, we expect continued wealth creation at the top of the economy and limited new luxury supply in our markets through 2028 to support 2027. Forward booking pace remains strong, and major events like Super Bowl LXI in Los Angeles add further tailwinds.”
Transition to Self-Managed REIT
Braemar has terminated its advisory agreement with Ashford, as well as its master hotel management and master project management agreements with Remington Lodging & Hospitality, LLC and Premier Project Management LLC, in accordance with their terms. In connection with the transition:
| · | Board transition. All current directors other than Mr. Stockton have agreed to resign from the Board, effective upon the filing of the Company’s definitive proxy statement, which is expected in approximately 10 days. The Company’s nominees are expected to join the Board following those resignations and will stand for election at the Annual Meeting. |
| · | Management is in-house. Braemar’s management team, including CEO Richard Stockton, is now employed directly by the Company. |
| · | Hotel management. Braemar has entered into agreements with third-party management companies Stonebridge Companies and Avion Hospitality to manage the Sofitel Chicago Magnificent Mile and Cameo Beverly Hills, respectively. |
Governance Updates
Following a review of its governing documents, the Board approved revisions to the Company’s Bylaws, Corporate Governance Guidelines, Code of Ethics and Board Committee Charters. Key updates include:
| · | Director resignation policy. Under a newly adopted majority vote standard and resignation policy, any incumbent director who fails to receive majority support from stockholders in an uncontested election must promptly tender his or her resignation, and the NCG Committee must promptly accept it. |
| · | Proxy access. The percentage of directors that may be nominated through proxy access has been increased from 20% to 25%. |
| · | Quorum. A majority quorum now applies to all stockholder meetings and matters, replacing the one-third quorum that previously applied to certain Board proposals. |
| · | Advance notice. The advance notice provisions have been updated. The notice window for annual meeting submissions now opens 120 days and closes 90 days before the anniversary of the prior year’s annual meeting, compared with 90 and 60 days previously. |
| · | REIT ownership provisions. Subject to stockholder approval at the Annual Meeting, the vote required to amend the REIT ownership and transfer provisions of the Company’s Articles of Amendment and Restatement (the “Charter”) would be reduced from two-thirds to a majority of the votes entitled to be cast. |
| · | Codes of ethics. The Company adopted an amended and restated Code of Business Conduct and Ethics and a separate Code of Ethics for the CEO and CFO. |
These updates reflect the Company’s continued focus on sound corporate governance as a self-managed public company.
Board Nominees
The preliminary proxy statement filed today includes Braemar’s previously announced slate of eight director nominees. Seven of the eight nominees are independent.
| · | Craig A. Barbarosh, former senior executive at an $8 billion real estate investment firm and audit committee chair of Sabra Health Care REIT, is expected to chair the Nominating and Corporate Governance (“NCG”) Committee and serve on the Compensation Committee. |
| · | Kevin Covey, founder of a real estate and private credit investment firm, is expected to serve on the Compensation Committee. |
| · | Stephen Haggerty, hotel real estate executive with more than two decades of senior roles at Marriott and Hyatt and former Managing Partner of Trinity Investments, is expected to serve as Chair of the Board, subject to election by the Board. |
| · | Daniel J. Hirsch, former co-leader of the real estate group at Farallon and current director on the Macerich board’s compensation and capital allocation committees, is expected to chair the Compensation Committee. |
| · | Kevin M. Luebbers, former CFO of public hotel REIT RFS Hotel Investors and senior executive at Hilton, is expected to serve on the Audit Committee and the NCG Committee. |
| · | Gail P. Steinel, audit committee chair of Federal Realty Investment Trust and Invesque Corporation, is expected to chair the Audit Committee. |
| · | Richard J. Stockton, CEO of Braemar with extensive institutional knowledge and deep expertise in real estate investment banking and capital markets, will continue to serve as a director. |
| · | Stephen W. Theriot, former CFO of Vornado Realty Trust and JBG SMITH Properties, is expected to serve on the Audit Committee and the NCG Committee. |
Mr. Stockton, the Company’s only non-independent director nominee, will not serve on any Board committees. Together, the eight nominees bring decades of public company leadership, lodging and REIT investment, capital markets, board and audit experience. Additional information about the nominees can be found in the preliminary proxy statement.
About Braemar Hotels & Resorts
Braemar Hotels & Resorts Inc. (NYSE: BHR) is a real estate investment trust (REIT) focused on the luxury hotel and resort sector. The Company targets luxury urban and resort properties, specializing in assets that generate revenue per available room (RevPAR) at least twice the U.S. national average. Its portfolio features luxury properties across the United States and the U.S. territories in the Caribbean.
Forward-Looking Statements
Certain statements in this communication contain or are based upon “forward-looking” information and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, among others, statements about the Company’s strategy, outlook and future plans. When we use words such as “will likely result,” “may,” “anticipate,” “estimate,” “should,” “expect,” “believe,” “intend,” or similar expressions, we intend to identify forward-looking statements. These statements are subject to known and unknown risks and uncertainties, many of which are outside Braemar’s control, which could cause actual results to differ materially from those anticipated, including, without limitation: the transition to self-management and related transition arrangements; the outcome of any pending or future litigation or other legal proceedings; our nomination of the director candidates; potential risks related to actions or proposals from stockholders; our ability to repay, refinance or restructure our debt and the debt of certain of our subsidiaries; anticipated or expected purchases or sales of assets; our projected operating results; completion of any pending transactions; our ability to effectuate our dividend policy, including operating results and the economic outlook influencing our board’s decision whether to pay dividends; our understanding of our competition; market trends; projected capital expenditures; the impact of technology on our operations and business; general volatility of the capital markets and the market price of our common stock and preferred stock; availability, terms and deployment of capital; availability of qualified personnel; changes in our industry and the markets in which we operate, interest rates or the general economy; and the degree and nature of our competition. These and other risk factors are more fully discussed in Braemar’s filings with the SEC.
The forward-looking statements in this communication are made only as of the date of this communication and are based on our beliefs, assumptions and expectations of our future performance, taking into account all information currently known to us. These beliefs, assumptions and expectations can change as a result of many potential events or factors, not all of which are known to us. Investors should not place undue reliance on forward-looking statements. The Company can give no assurance that these statements will be attained, and is not obligated to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law.
Non-GAAP Measures
This press release contains non-GAAP financial measures, including EBITDA, EBITDAre, Adjusted EBITDAre, Hotel EBITDA, Comparable Hotel EBITDA, Comparable Hotel EBITDA Margin, FFO, NAREIT FFO, Adjusted FFO, Net Debt and Net Debt to Gross Assets. Management believes these measures are useful to investors because they exclude items that do not reflect the ongoing operating performance of the Company's hotels — principally depreciation and amortization, which is substantial for a real estate owner and does not correlate with the change in value of the Company's properties, together with financing costs, income taxes, impairment charges, gains and losses on asset dispositions, and costs associated with transactions and the Company's transition to self-management. Presenting results on this basis allows period-to-period comparisons of hotel-level and corporate operating performance, facilitates comparison with other lodging REITs that report similar measures, and reflects how management evaluates the portfolio, allocates capital and measures the performance of the Company's hotel managers. These measures are also used in the Company's internal budgeting and forecasting and, in the case of Net Debt and Net Debt to Gross Assets, in evaluating leverage and balance sheet capacity.
These measures should not be considered in isolation or as substitutes for net income (loss), operating income, cash flow from operating activities, or any other measure prepared in accordance with GAAP, and they are not indicative of funds available to meet the Company's cash needs, including the ability to fund distributions. Because these measures are not standardized, the Company's presentation may not be comparable to similarly titled measures reported by other companies.
EBITDA is net income (loss) before interest expense and amortization of loan costs, depreciation and amortization, income taxes, and equity in (earnings) loss of unconsolidated entities, and after the Company's portion of EBITDA of OpenKey. EBITDAre is EBITDA further adjusted to exclude impairment charges on real estate and (gain) loss on the disposition of assets and hotel property, as defined by NAREIT. EBITDA yield is defined as trailing twelve month EBITDA divided by the purchase price or debt amount. A capitalization rate is determined by dividing the property's net operating income by the purchase price. Net operating income is the property's Hotel EBITDA minus a capital expense reserve of either 4% or 5% of gross revenues. Hotel EBITDA flow-through is the change in Hotel EBITDA divided by the change in total revenues. Adjusted EBITDAre is EBITDAre further adjusted to exclude amortization of favorable (unfavorable) contract assets and liabilities, transaction and conversion costs, other (income) loss, write-off of loan costs and exit fees, realized and unrealized (gain) loss on derivatives, stock- and unit-based compensation, legal, advisory and settlement costs, advisory services incentive fees, (gain) loss on extinguishment of debt, (gain) loss on insurance settlement, and severance. Hotel EBITDA is property-level net income (loss) before interest expense and amortization of loan costs, depreciation and amortization, income taxes and non-hotel EBITDA ownership expense, less EBITDA attributable to noncontrolling interests in consolidated entities. Comparable Hotel EBITDA further adjusts Hotel EBITDA to present results for all periods as though each hotel had been owned for the full period. Hotel EBITDA Margin is Hotel EBITDA divided by total hotel revenue. FFO is net income (loss) computed in accordance with GAAP, excluding gains and losses from the sale of properties and impairment charges on depreciable real estate, plus real estate–related depreciation and amortization, and after adjustments for unconsolidated entities and noncontrolling interests. NAREIT FFO is FFO as defined by NAREIT. Adjusted FFO is NAREIT FFO further adjusted for items the Company does not consider indicative of ongoing operating performance, consistent with the adjustments described under Adjusted EBITDAre. Net Debt is total indebtedness less unrestricted cash, restricted cash and the Company's loan receivable. Gross Assets is total assets plus accumulated depreciation. Net Debt to Gross Assets is Net Debt divided by Gross Assets. RevPAR, Total RevPAR, ADR and occupancy are hotel operating statistics and are not non-GAAP financial measures. Comparable operating statistics present all periods as though each hotel had been owned for the full period.
Important Information for Investors and Stockholders
Certain Information Regarding Participants
Braemar and its directors and certain of its executive officers will be deemed to be “participants” (as defined in Schedule 14A under the Securities Exchange Act of 1934, as amended) in the solicitation of proxies from the Company’s stockholders by Braemar in connection with the matters to be considered at Braemar’s 2026 Annual Meeting of Stockholders. Information regarding the names of Braemar’s executive officers and directors and their respective interests in Braemar by security holdings or otherwise is set forth (i) in Braemar’s proxy statement for the 2025 Annual Meeting of Stockholders, which was filed with the SEC on October 30, 2025 (the “2025 Proxy Statement”), including under the headings “SUMMARY”, “PROPOSAL NUMBER ONE-ELECTION OF DIRECTORS”, “CORPORATE GOVERNANCE”, “BOARD OF DIRECTORS AND COMMITTEES”, “EXECUTIVE OFFICERS”, “EXECUTIVE COMPENSATION”, “PROPOSAL NUMBER TWO-ADVISORY APPROVAL OF EXECUTIVE COMPENSATION”, “SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN BENEFICIAL OWNERS” and “CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS” and (ii) under Item 1.01 “ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT” in the Current Reports on Form 8-K filed by Braemar with the SEC on December 23, 2025, on March 17, 2026, on April 3, 2026 and on May 22, 2026, under Item 5.02 “DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS” in the Current Reports on Form 8-K filed by Braemar with the SEC on February 25, 2026, on February 27, 2026, on March 6, 2026, on March 17, 2026 and on May 28, 2026, under Item 5.07 “SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS” in the Current Report on Form 8-K filed by Braemar with the SEC on December 16, 2025 and under Item 8.01 “OTHER EVENTS” in the Current Report on Form 8-K filed by Braemar with the SEC on June 1, 2026. To the extent holdings of such persons in the Company’s securities have changed since the amounts described in the 2025 Proxy Statement, such changes have been reflected on Initial Statements of Beneficial Ownership on Form 3 or Statements of Change in Ownership on Form 4 filed with the SEC, by Jim A. Plohg on December 22, 2025, by Jim A. Plohg on January 14, 2026, by Monty J. Bennett on February 26, 2026, by Richard J. Stockton on February 26, 2026 and by Eric Batis on June 1, 2026. Additional information can also be found in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, filed with the SEC on March 12, 2026, as amended by Amendment No. 1 to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025. Details concerning the nominees of Braemar’s Board of Directors for election at the 2026 Annual Meeting will be included in the Proxy Statement (defined below). These documents, including the definitive Proxy Statement (and any amendments or supplements thereto) and other documents filed by the Company with the SEC, are or will be available free of charge at the SEC’s website at www.sec.gov. Copies of the documents filed by Braemar are also available free of charge by accessing the “SEC Filings” section of the Company’s website at www.braemar.q4ir.com/investor/financials-sec-filings/sec-filings/.
Important Information and Where to Find It
Braemar Hotels & Resorts Inc. (the “Company” or “Braemar”) intends to file a proxy statement and GOLD proxy card and other relevant documents with the SEC in connection with its solicitation of proxies from the Company’s stockholders for Braemar’s 2026 Annual Meeting of Stockholders (the “Proxy Statement”). This communication is neither a solicitation of a proxy nor a substitute for any proxy statement or other document that Braemar may file with the SEC in connection with any solicitation by Braemar. BRAEMAR STOCKHOLDERS ARE URGED TO READ THE PROXY STATEMENT (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) FILED BY BRAEMAR AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC WHEN THEY BECOME AVAILABLE CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Stockholders may obtain copies of these documents and other documents filed with the SEC by Braemar free of charge through the website maintained by the SEC at www.sec.gov. Copies of the documents filed by Braemar are also available free of charge by accessing the “SEC Filings” section of the Company’s website at www.braemar.q4ir.com/investor/financials-sec-filings/sec-filings/.
BRAEMAR HOTELS & RESORTS INC. AND SUBSIDIARIES
RECONCILIATION OF NET INCOME (LOSS) TO HOTEL EBITDA
(in thousands)
(unaudited)
| Three Months Ended September 30, 2026 | Three Months Ended September 30, 2025 | |||||||||||||||||||||||
| Hotel Total | Corporate / Allocated | Braemar Hotels & Resorts Inc. | Hotel Total | Corporate / Allocated | Braemar Hotels & Resorts Inc. | |||||||||||||||||||
| Net income (loss) | 258,085 | (507,469 | ) | (249,384 | ) | 33,765 | (29,042 | ) | 4,723 | |||||||||||||||
| Non-property adjustments | (259,922 | ) | 259,922 | — | (40,584 | ) | 40,584 | — | ||||||||||||||||
| Interest income | (257 | ) | 257 | — | (400 | ) | 400 | — | ||||||||||||||||
| Interest expense | 5,957 | 8,568 | 14,525 | 7,693 | 14,769 | 22,462 | ||||||||||||||||||
| Amortization of loan cost | 470 | 1,208 | 1,678 | 529 | 2,197 | 2,726 | ||||||||||||||||||
| Depreciation and amortization | 16,610 | 1 | 16,611 | 23,164 | — | 23,164 | ||||||||||||||||||
| Income tax expense (benefit) | (7,918 | ) | (1,838 | ) | (9,756 | ) | (1 | ) | (647 | ) | (648 | ) | ||||||||||||
| Non-hotel EBITDA ownership expense | 1,671 | (1,671 | ) | — | 1,396 | (1,396 | ) | — | ||||||||||||||||
| Hotel EBITDA including amounts attributable to noncontrolling interest | 14,696 | (241,022 | ) | (226,326 | ) | 25,562 | 26,865 | 52,427 | ||||||||||||||||
| Less: EBITDA adjustments attributable to consolidated noncontrolling interest | — | — | — | (937 | ) | 937 | — | |||||||||||||||||
| Equity in earnings (loss) of unconsolidated entities | — | — | — | — | — | — | ||||||||||||||||||
| Hotel EBITDA attributable to the Company and OP unitholders | 14,696 | (241,022 | ) | (226,326 | ) | 24,625 | 27,802 | 52,427 | ||||||||||||||||
| Non-comparable adjustments | (1,783 | ) | (14,865 | ) | ||||||||||||||||||||
| Comparable hotel EBITDA | 12,913 | 10,697 | ||||||||||||||||||||||
| RESORT PROPERTIES: | ||||||||||||||||||||||||
| Hotel EBITDA including amounts attributable to noncontrolling interest | 4,539 | 14,437 | ||||||||||||||||||||||
| Non-comparable adjustments | (1,761 | ) | (9,950 | ) | ||||||||||||||||||||
| Comparable hotel EBITDA | 2,778 | 4,487 | ||||||||||||||||||||||
| URBAN PROPERTIES: | ||||||||||||||||||||||||
| Hotel EBITDA including amounts attributable to noncontrolling interest | 10,157 | 11,125 | ||||||||||||||||||||||
| Non-comparable adjustments | (22 | ) | (4,915 | ) | ||||||||||||||||||||
| Comparable hotel EBITDA | 10,135 | 6,210 | ||||||||||||||||||||||
NOTE: The above comparable information assumes the eight hotel properties owned and included in the Company's operations at September 30, 2026, were owned as of the beginning of each of the periods presented.
Exhibit 99.2
 |
NEWS RELEASE |
Contact: |
Justin Coe |
Joe Calabrese | |
| Chief Financial Officer | Financial Relations Board | ||
| (888) 517-7456 | (212) 827-3772 |
BRAEMAR HOTELS & RESORTS ANNOUNCES $358 MILLION REFINANCING OF FOUR HOTELS
DALLAS, November 10, 2026 – Braemar Hotels & Resorts Inc. (NYSE: BHR) (“Braemar” or the “Company”) announced today that it has successfully closed a new $358.0 million CMBS loan secured by The Ritz-Carlton St. Thomas, The Ritz-Carlton Reserve Dorado Beach, The Notary Hotel and Sofitel Chicago Magnificent Mile. The loan is interest-only, has a two-year initial term with three one-year extension options, subject to certain conditions, taking the final maturity to November 2031 and provides for a floating interest rate of SOFR + 2.37%.
The new loan replaces two existing CMBS loans with combined outstanding balances of approximately $290.4 million as of September 30, 2026. The loan secured by The Ritz-Carlton St. Thomas, with a balance of approximately $80.5 million, carried a spread of SOFR + 4.91% and had a final maturity of August 2029. The loan secured by The Ritz-Carlton Reserve Dorado Beach, The Notary Hotel and Sofitel Chicago Magnificent Mile, with a balance of approximately $209.9 million, carried a spread of SOFR + 2.83% and had a final maturity of March 2030. Together, the refinancing reduces the weighted-average spread on the loans for these four hotels by approximately 104 basis points, from approximately 3.41% to approximately 2.37%, while also extending the final maturities.
The $358.0 million loan balance is $42.0 million lower than the $400.0 million estimated in the Company’s October 2026 investor presentation.
“This refinancing meaningfully lowers our interest rate spread and extends maturities on the loans for four of our seven hotels. The final loan balance also came in well below our October investor presentation estimate, reflecting our management team’s disciplined approach to capital allocation and commitment to creating long-term value for shareholders,” said Richard J. Stockton, President and Chief Executive Officer.
Braemar Hotels & Resorts Announces $358 Million Refinancing of Four Hotels
Page 2
November 10, 2026
About Braemar Hotels & Resorts
Braemar Hotels & Resorts Inc. (NYSE: BHR) is a real estate investment trust (REIT) focused on the high-growth luxury hotel and resort sector. Its industry-leading portfolio features luxury properties across the United States and the U.S. territories in the Caribbean.
Forward-Looking Statements
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 federal securities regulations. Forward-looking statements are generally identifiable by use of forward-looking terminology such as "may," "will," "should," "potential," "intend," "expect," "anticipate," "estimate," "approximately," "believe," "could," "project," "predict," or other similar words or expressions. Additionally, statements regarding the following subjects are forward-looking by their nature: our business and investment strategy; anticipated or expected purchases, sales or dispositions of assets; our projected operating results; completion of any pending transactions; our ability to restructure existing property-level indebtedness; our ability to secure additional financing to enable us to operate our business; our understanding of our competition; projected capital expenditures; and the impact of technology on our operations and business. Such forward-looking statements are based on our beliefs, assumptions, and expectations of our future performance taking into account all information currently known to us. These beliefs, assumptions, and expectations can change as a result of many potential events or factors, not all of which are known to us. If a change occurs, our business, financial condition, liquidity, results of operations, plans, and other objectives may vary materially from those expressed in our forward-looking statements. You should carefully consider this risk when you make an investment decision concerning our securities. These and other risk factors are more fully discussed in the Company's filings with the SEC.
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 will not publicly update or revise any forward-looking statements, whether as a result of new information, future events or circumstances, changes in expectations or otherwise except to the extent required by law.