ASHFORD HOSPITALITY TRUST INC Management’s Discussion and Analysis of Financial Condition and Results of Operations (Form 10-K)

This section of this Form 10-K generally discusses 2021 and 2020 items and
year-to-year comparisons between 2021 and 2020. Discussions of 2020 items and
year-to-year comparisons between 2020 and 2019 that are not included in this
Form 10-K can be found in "Management's Discussion and Analysis of Financial
Condition and Results of Operations" in Part II, Item 7 of the Company's Annual
Report on Form 10-K for the year ended December 31, 2020.

EXECUTIVE OVERVIEW

General

From December 31, 2021, we had 100 consolidated hotel properties, representing 22,313 rooms in total. Currently, all of our hotel properties are located in United States.

Based on our key business objectives and anticipated operating conditions, our current key financial priorities and strategies include, among others:

•adjustment of cost and operating models due to the impact of COVID-19 on the hospitality industry;

•maintain maximum liquidity of cash and cash equivalents;

• timely exchange of preferred shares for common shares;

•the disposal of non-essential hotel properties;

•pursue capital markets activities to enhance long-term shareholder value;

•the implementation of selective capital improvements aimed at increasing profitability;

•implementing effective asset management strategies to minimize operating costs and increase revenues;

•finance or refinance hotels on competitive terms;

•use hedging and derivatives to mitigate risk; and

•make other investments or divestitures that our Board of Directors deems appropriate.

Our current investment strategy is to focus on owning predominantly full-service
hotels in the upper upscale segment in domestic markets that have revenue per
available room ("RevPAR") generally less than twice the national average. We
believe that as supply, demand, and capital market cycles change, we will be
able to shift our investment strategy to take advantage of new lodging-related
investment opportunities as they may develop. Our board of directors may change
our investment strategy at any time without stockholder approval or notice. We
will continue to seek ways to benefit from the cyclical nature of the hotel
industry.

Liquidity

In December 2019, COVID-19 was identified in Wuhan, China, subsequently spread
to other regions of the world, and resulted in significant travel restrictions
and the extended shutdown of numerous businesses throughout the United States.
In March 2020, the World Health Organization declared COVID-19 to be a global
pandemic. Beginning in late February 2020, we experienced a significant decline
in occupancy and RevPAR, and we expect the occupancy and RevPAR declines
associated with COVID-19 to continue. The prolonged presence of the virus
resulted in health and other government authorities imposing widespread
restrictions on travel and other businesses.

On January 15, 2021, the Company entered into the Credit Agreement with Oaktree
comprised of (a) initial term loans in an aggregate principal amount of
$200 million, (b) initial delayed draw term loans (the "Initial DDTL") in an
aggregate principal amount of up to $150 million and (c) additional delayed draw
term loans (the "Additional DDTL") in an aggregate principal amount of up to
$100 million. On October 12, 2021, the Company and Ashford Truest OP entered
into Amendment No. 1 to the Credit Agreement (Original Credit Agreement, as
amended thereby, the "Credit Agreement").
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As of December 31, 2021, the Company held cash and cash equivalents of $592.1
million and restricted cash of $99.5 million. The vast majority of the
restricted cash comprises lender and manager held reserves. During 2020, the
Company worked with its property managers and lenders in order to utilize lender
and manager held reserves to fund operating shortfalls. The Company continues to
have discussions with one of its lenders about a potential modification on its
property level debt. On November 23, 2021, the Company announced that its board
of directors declared cash dividends on the Company's 8.45% Series D Cumulative
Preferred Stock, 7.375% Series F Cumulative Preferred Stock, 7.375% Series G
Cumulative Preferred Stock, 7.50% Series H Cumulative Preferred Stock, and 7.50%
Series I Cumulative Preferred Stock reflecting accrued and unpaid dividends for
the quarters ended June 30, 2020, September 30, 2020, December 31, 2020, March
31, 2021, June 30, 2021, and September 30, 2021. The board of directors also
declared cash dividends on the Company's 8.45% Series D Cumulative Preferred
Stock, 7.375% Series F Cumulative Preferred Stock, 7.375% Series G Cumulative
Preferred Stock, 7.50% Series H Cumulative Preferred Stock, and 7.50% Series I
Cumulative Preferred Stock for the quarter ended December 31, 2021. The Company
has continued the suspension of its common stock dividend into 2022 in light of
the ongoing uncertainty from the COVID-19 pandemic and to protect liquidity.

We cannot predict when hotel operating levels will return to normalized levels
after the effects of the pandemic subside, whether our hotels will be forced to
shut down operations or whether one or more possible recurrences of COVID-19
case surges could result in further reductions in business and personal travel
or potentially cause state and local governments to reinstate travel
restrictions. Facts and circumstances could change in the future that are
outside of management's control, such as additional government mandates, health
official orders, travel restrictions and extended business shutdowns due to
COVID-19.

RECENT DEVELOPMENTS

On January 15, 2021, the Company and Ashford Trust OP entered into the Oaktree
Credit Agreement with Oaktree and the Administrative Agent. On October 12, 2021,
the Company entered into Amendment No. 1 to the Oaktree Credit Agreement with
Oaktree and the Administrative Agent. Amendment No. 1 to the Oaktree Credit
Agreement, subject to the conditions set forth therein, among other items: (i)
extends the commitment period of the Initial DDTL and Additional DDTL from 30
months to 42 months after the initial closing date of the Credit Agreement, if
the Initial Term Loans are repaid in full prior to the expiration of such
commitment period (the "DDTL Commitment Period"); (ii) suspends the Company's
obligations to comply with certain covenants during the DDTL Commitment Period
if no Loans or accrued interest thereon are outstanding; (iii) suspends the
Company's obligation to subordinate fees due under the advisory agreement if at
any point there is no accrued paid-in-kind interest outstanding or any accrued
dividends on any of the Company's preferred stock and the Company has sufficient
unrestricted cash to repay in full all outstanding Loans; (iv) permits Oaktree,
at any time, elect to receive the exit fee in warrants for the purchase of
common stock of the Company equal to 19.9% of all common stock outstanding on
the closing date of the Oaktree Credit Agreement subject to certain upward or
downward adjustments; and (v) provides that in the event prior to the
termination of the Oaktree Credit Agreement, Oaktree elects to receive the exit
fee in warrants and any of such warrants are sold at a price per share of common
stock in excess of $40, all obligations owing to Oaktree shall be reduced by an
amount equal to 25% of the amount of such excess consideration, subject to
certain adjustments. On November 19, 2021, the Company entered into a Limited
Waiver to the Oaktree Credit Agreement (the "Limited Waiver") with the
guarantors party thereto, Oaktree and the Administrative Agent. Pursuant to the
Limited Waiver, Oaktree and the Administrative Agent waived the Company's
obligation to comply with the negative covenant set forth in the Oaktree Credit
Agreement insofar as such negative covenant prohibits the declaration of any
Restricted Payment (as defined in the Credit Agreement) constituting current or
accrued dividends on the Company's preferred stock on or before November 30,
2021. As a result of the Limited Waiver, effective November 19, 2021, the
Company is permitted to declare current and accrued dividends on the Company's
preferred stock so long as such declared dividends are not made or paid until
after November 30, 2021, and (i) no PIK Principal is then outstanding, and (ii)
the aggregate amount of Unrestricted Cash (as defined in the Oaktree Credit
Agreement), after giving effect to such Restricted Payment constituting current
and accrued dividends on the Company's preferred stock, is not less than an
amount equal to the sum of (x) $100,000,000 plus (y) the aggregate principal
amount of delayed draw term loans advanced prior to the date thereof or
contemporaneously therewith.

On November 1, 2021, we refinanced our $78.6 million mortgage loan, secured by
the Marriott Gateway Crystal City in Arlington, Virginia. The new mortgage loan
totals $86.0 million. The initial funding for the loan was $84.0 million, with
the additional $2.0 million available to fund debt service for the first 30
months of the loan, if needed. The new mortgage loan is interest only and
provides for an interest rate of LIBOR + 4.65%. The mortgage loan has a
three-year term with two one-year extension options, subject to the satisfaction
of certain conditions. The mortgage loan is secured by the Marriott Gateway
Crystal City.

In November of 2021, the Company made an initial investment of $8.5 million in
815 Commerce Managing Member, LLC ("815 Commerce MM"), which is developing the
Le Meridien Fort Worth.
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At December 9, 2021the Company made an additional investment in OpenKey of approximately $250,000.

RESULTS OF OPERATIONS

Key operational performance indicators

We use a variety of operating and other information to evaluate the operating
performance of our business. These key indicators include financial information
that is prepared in accordance with GAAP as well as other financial measures
that are non-GAAP measures. In addition, we use other information that may not
be financial in nature, including statistical information and comparative data.
We use this information to measure the operating performance of our individual
hotels, groups of hotels and/or business as a whole. We also use these metrics
to evaluate the hotels in our portfolio and potential acquisitions to determine
each hotel's contribution to cash flow and its potential to provide attractive
long-term total returns. These key indicators include:

•Occupancy-Occupancy means the total number of hotel rooms sold in a given
period divided by the total number of rooms available. Occupancy measures the
utilization of our hotels' available capacity. We use occupancy to measure
demand at a specific hotel or group of hotels in a given period.

•ADR-ADR means average daily rate and is calculated by dividing total hotel
rooms revenues by total number of rooms sold in a given period. ADR measures
average room price attained by a hotel and ADR trends provide useful information
concerning the pricing environment and the nature of the customer base of a
hotel or group of hotels. We use ADR to assess the pricing levels that we are
able to generate.

•RevPAR-RevPAR means revenue per available room and is calculated by multiplying
ADR by the average daily occupancy. RevPAR is one of the commonly used measures
within the hotel industry to evaluate hotel operations. RevPAR does not include
revenues from food and beverage sales or parking, telephone or other non-rooms
revenues generated by the property. Although RevPAR does not include these
ancillary revenues, it is generally considered the leading indicator of core
revenues for many hotels. We also use RevPAR to compare the results of our
hotels between periods and to analyze results of our comparable hotels
(comparable hotels represent hotels we have owned for the entire period). RevPAR
improvements attributable to increases in occupancy are generally accompanied by
increases in most categories of variable operating costs. RevPAR improvements
attributable to increases in ADR are generally accompanied by increases in
limited categories of operating costs, such as management fees and franchise
fees.

RevPAR changes that are primarily driven by changes in occupancy have different
implications for overall revenues and profitability than changes that are driven
primarily by changes in ADR. For example, an increase in occupancy at a hotel
would lead to additional variable operating costs (including housekeeping
services, utilities and room supplies) and could also result in increased other
operating department revenue and expense. Changes in ADR typically have a
greater impact on operating margins and profitability as they do not have a
substantial effect on variable operating costs.

Occupancy, ADR and RevPAR are commonly used measures within the lodging industry
to evaluate operating performance. RevPAR is an important statistic for
monitoring operating performance at the individual hotel level and across our
entire business. We evaluate individual hotel RevPAR performance on an absolute
basis with comparisons to budget and prior periods, as well as on a regional and
company-wide basis. ADR and RevPAR include only rooms revenue. Rooms revenue is
dictated by demand (as measured by occupancy), pricing (as measured by ADR) and
our available supply of hotel rooms.

We also use funds from operations ("FFO"), Adjusted FFO, earnings before
interest, taxes, depreciation and amortization for real estate ("EBITDAre") and
Adjusted EBITDAre as measures of the operating performance of our business. See
"Non-GAAP Financial Measures."

Key Factors Affecting Our Results of Operations

The principal factors affecting our operating results include overall demand for
hotel rooms compared to the supply of available hotel rooms, and the ability of
our third-party management companies to increase or maintain revenues while
controlling expenses.

Demand-The demand for lodging, including business travel, is directly correlated
to the overall economy; as GDP increases, lodging demand typically increases.
Historically, periods of declining demand are followed by extended periods of
relatively strong demand, which typically occurs during the growth phase of the
lodging cycle. Beginning in 2020, the COVID-19 pandemic had a direct impact on
demand.

Supply-The development of new hotels is driven largely by construction costs,
the availability of financing and expected performance of existing hotels.
Short-term supply is also expected to be below long-term averages. While the
industry is expected to have supply growth below historical averages, we may
experience supply growth, in certain markets, in excess of
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national averages which can have a negative impact on performance. From 2020, the COVID-19 pandemic had a direct impact on supply.

We expect that our ADR, occupancy and RevPAR performance will be impacted by
macroeconomic factors such as national and local employment growth, personal
income and corporate earnings, GDP, consumer confidence, office vacancy rates
and business relocation decisions, airport and other business and leisure
travel, new hotel construction, the pricing strategies of competitors and
currency fluctuations. In addition, our ADR, occupancy and RevPAR performance
are dependent on the continued success of the Marriott, Hilton and Hyatt brands.

Revenue – Almost all of our revenue comes from hotel operations. Concretely, our income is made up of:

• Room Revenue: Occupancy and ADR are the primary drivers of room revenue. Room revenue represents the vast majority of our total revenue.

•Food and beverage revenue: Occupancy and the type of customer staying at the
hotel are the major drivers of food and beverage revenue (i.e., group business
typically generates more food and beverage business through catering functions
when compared to transient business, which may or may not utilize the hotel's
food and beverage outlets or meeting and banquet facilities).

•Other hotel revenues: the occupancy and nature of the establishment are the main drivers of other ancillary revenues, such as telecommunications, parking and rental services.

Hotel Operating Expenses-The below presents the components of our hotel operating expenses:

•Rooms expense: These costs include housekeeping wages and payroll taxes,
reservation systems, room supplies, laundry services and front desk costs. Like
rooms revenue, occupancy is the major driver of rooms expense and, therefore,
rooms expense has a significant correlation to rooms revenue. These costs can
increase based on increases in salaries and wages, as well as the level of
service and amenities that are provided.

•Food and beverage expense: These expenses primarily include food, beverage and
labor costs. Occupancy and the type of customer staying at the hotel (i.e.,
catered functions generally are more profitable than restaurant, bar or other
on-property food and beverage outlets) are the major drivers of food and
beverage expense, which correlates closely with food and beverage revenue.

•Management fees: Base management fees are computed as a percentage of gross
revenue. Incentive management fees generally are paid when operating profits
exceed certain threshold levels.

•Other hotel expenses: These expenses include labor and other costs associated
with the other operating department revenues, as well as labor and other costs
associated with administrative departments, franchise fees, sales and marketing,
repairs and maintenance and utility costs.

Most categories of variable operating expenses, including labor costs such as
housekeeping, fluctuate with changes in occupancy. Increases in occupancy are
accompanied by increases in most categories of variable operating expenses,
while increases in ADR typically only result in increases in limited categories
of operating costs and expenses, such as franchise fees, management fees and
credit card processing fee expenses which are based on hotel revenues. Thus,
changes in ADR have a more significant impact on operating margins than changes
in occupancy.
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The following table summarizes changes to key items in our Consolidated Statements of Income for the years ended December 31, 20212020 and 2019 (in thousands):

                                                                                                                 Favorable (Unfavorable)
                                                          Year Ended December 31,                                        Change
                                               2021                2020                 2019               2021 to 2020            2020 to 2019
Total revenue                              $  805,411          $  508,238          $ 1,502,759          $    297,173             $    (994,521)
Total hotel expenses                         (576,806)           (434,672)            (952,674)             (142,134)                  518,002
Property taxes, insurance and other           (67,904)            (79,669)             (84,112)               11,765                     4,443
Depreciation and amortization                (218,851)           (252,765)            (269,003)               33,914                    16,238
Impairment charges                                  -             (91,721)             (33,628)               91,721                   (58,093)

Advisory service fee                          (52,313)            (50,050)             (63,632)               (2,263)                   13,582
Corporate, general and administrative         (16,153)            (28,048)             (11,107)               11,895                   (16,941)
Gain (loss) on disposition of assets and
hotel properties                                1,449             (36,680)              26,126                38,129                   (62,806)
Operating income (loss)                      (125,167)           (465,367)             114,729               340,200                  (580,096)
Equity in earnings (loss) of
unconsolidated entities                          (558)               (448)              (2,307)                 (110)                    1,859
Interest income                                   207                 672                3,067                  (465)                   (2,395)
Other income (expense)                            760             (16,998)              10,490                17,758                   (27,488)
Interest expense and amortization of
discounts and loan costs                     (156,119)           (247,381)            (262,001)               91,262                    14,620
Write-off of premiums, loan costs and exit
fees                                          (10,612)            (13,867)              (2,841)                3,255                   (11,026)
Gain (loss) on extinguishment of debt          11,896              90,349                    -               (78,453)                   90,349
Unrealized gain (loss) on marketable
securities                                          -              (1,467)               1,896                 1,467                    (3,363)
Unrealized gain (loss) on derivatives          14,493              19,950               (4,494)               (5,457)                   24,444
Income tax benefit (expense)                   (5,948)              1,335               (1,218)               (7,283)                    2,553

Net income (loss)                            (271,048)           (633,222)            (142,679)              362,174                  (490,543)
(Income) loss from consolidated entities
attributable to noncontrolling interests           73                 338                  112                  (265)                      226
Net (income) loss attributable to
redeemable noncontrolling interests in
operating partnership                           3,970              89,008               28,932               (85,038)                   60,076
Net income (loss) attributable to the
Company                                    $ (267,005)         $ (543,876)         $  (113,635)         $    276,871             $    (430,241)


The following table illustrates the hotel properties and WorldQuest key performance indicators included in our results of operations:

                                             Year Ended December 31,
                                            2021                  2020
RevPAR (revenue per available room)    $     79.44             $  45.87
Occupancy                                    55.62   %            34.31  %
ADR (average daily rate)               $    142.82             $ 133.70


The following table illustrates the key performance indicators of the 100 hotel
properties and WorldQuest that were included for the full years ended December
31, 2021 and 2020, respectively:

                  Year Ended December 31,
                 2021                  2020
RevPar      $     79.61             $  46.34
Occupancy         55.63   %            34.39  %
ADR         $    143.09             $ 134.76


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Comparison of the year ended December 31, 2021 and 2020

Net profit (loss) attributable to the Company. Net loss attributable to the Company decreased $276.9 million from $543.9 million for the year ended December 31, 2020 (“2020”) to $267.0 million for the year ended December 31, 2021
(“2021”) due to the factors described below.

Revenue. Rooms revenue from our hotel properties and WorldQuest increased $247.6
million, or 60.8%, to $655.1 million in 2021 compared to 2020. This increase is
attributable to higher rooms revenue of $272.3 million at our comparable hotel
properties and WorldQuest as our hotel properties recover from the effects of
the COVID-19 pandemic, partially offset by a decrease of $24.6 million from our
Hotel Dispositions. Our comparable hotel properties experienced an increase of
6.2% in room rates and an increase of 2,124 basis points in occupancy.

Food and beverage revenue increased $33.8 million, or 55.2%, to $94.9 million in
2021 compared to 2020. This increase is attributable to higher food and beverage
revenue of $34.8 million at our comparable hotel properties and WorldQuest as a
result of the COVID-19 pandemic, partially offset by a decrease of $1.1 million
from our Hotel Dispositions.

Other hotel revenue, which consists mainly of Internet access, parking, and spa
revenue, increased $15.3 million, or 40.3%, to $53.1 million in 2021 compared to
2020. This increase is attributable to higher other revenue of $17.3 million
from our comparable hotel properties and WorldQuest as our hotel properties
recover from the effects of the COVID-19 pandemic, partially offset by a
decrease of $2.0 million from our Hotel Dispositions.

Hotel Operating Expenses. Hotel operating expenses increased $142.1 million,
or 32.7%, to $576.8 million in 2021 compared to 2020. Hotel operating expenses
consist of direct expenses from departments associated with revenue streams and
indirect expenses associated with support departments and management fees.
Direct expenses increased $76.6 million in 2021 compared to 2020, comprised of
an increase of $84.3 million from our comparable hotel properties and WorldQuest
as our hotel properties continue to recover from the effects of the COVID-19
pandemic and partially offset by $7.6 million from our Hotel Dispositions.
Direct expenses were 29.9% of total hotel revenue for 2021 and 32.3% for 2020.
Indirect expenses and management fees increased $65.5 million in 2021 compared
to 2020, comprised of an increase of $81.7 million from our comparable hotel
properties and WorldQuest as a result of the COVID-19 pandemic and partially
offset by $16.3 million from our Hotel Dispositions.

Property Taxes, Insurance and Other. Property taxes, insurance and other expense
decreased $11.8 million or 14.8%, to $67.9 million in 2021 compared to 2020,
which was primarily due to a decrease of $7.1 million from our Hotel
Dispositions and $4.7 million at our comparable hotel properties.

Depreciation and Amortization. Depreciation and amortization decreased $33.9
million or 13.4%, to $218.9 million in 2021 compared to 2020, which consisted of
lower depreciation of $20.3 million as a result of our Hotel Dispositions and
lower depreciation of $13.6 million at our comparable hotel properties and
WorldQuest.

Depreciation charges. Impairment charges were $0 and $91.7 million in 2021 and 2020, respectively.

In the first quarter of 2020, we recorded an impairment charge of $27.6 million
that was comprised of $13.9 million at the Columbus Hampton Inn Easton, $10.0
million at the Canonsburg Homewood Suites Pittsburgh Southpointe and $3.7
million at the Phoenix Hampton Inn Airport North as a result of reduced
estimated cash flows resulting from the COVID-19 pandemic and changes to the
expected holding periods of these hotel properties.

In the second quarter of 2020, we recorded an impairment charge of $27.6
million. On July 9, 2020, the non-recourse mortgage loan secured by eight hotel
properties matured. The lender provided notice of UCC sale, which provided that
the respective lender would sell the subsidiaries of the Company that own the
respective hotels in a public auction. As a result, as of June 30, 2020, the
estimated fair value of each hotel property was compared to its carrying value.
The impairment charge was comprised of $1.7 million at the Columbus Hampton Inn
Easton, $1.8 million at the Canonsburg Homewood Suites Pittsburgh Southpointe,
$9.5 million at the Billerica Courtyard, $6.1 million at the Wichita Courtyard,
$3.0 million at the Washington Hampton Inn Pittsburgh Meadow Lands, $3.0 million
at the Pittsburgh Hampton Inn Waterfront West Homestead and $2.4 million at the
Stillwater Residence Inn.

In the third quarter of 2020, we recorded an impairment charge of $29.9 million.
In conjunction with the disposition of the W Minneapolis, we engaged a
third-party valuation expert to assist in determining the fair value of the
hotel property. The impairment charge was $29.9 million, the difference between
the estimated fair value of the property and the net book value.

In the fourth quarter of 2020, we recorded an impairment loss of $6.6 million
following changes to Minneapolis Le Meridien’s expected holding period.

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Advisory Services Fee. Advisory services fee increased $2.3 million, or 4.5%, to
$52.3 million in 2021 compared to 2020. The advisory services fee represents
fees incurred in connection with the advisory agreement between Ashford Inc. and
the Company. In 2021, the advisory services fee was comprised of a base advisory
fee of $36.2 million, equity-based compensation of $9.1 million associated with
equity grants of our common stock and LTIP units awarded to the officers and
employees of Ashford Inc. and reimbursable expenses of $6.9 million. In 2020,
the advisory services fee was comprised of a base advisory fee of $34.7 million,
equity-based compensation of $8.9 million associated with equity grants of our
common stock and LTIP units awarded to the officers and employees of Ashford
Inc., which is inclusive of a $2.3 million credit related to PSU forfeitures,
and reimbursable expenses of $6.4 million.

Corporate, General and Administrative. Corporate, general and administrative
expense decreased $11.9 million, or 42.4%, to $16.2 million in 2021 compared to
2020. The decrease was primarily attributable to lower legal and professional
fees of $9.1 million, lower reimbursed operating expenses of Ashford Securities
paid by the Company of $2.0 million, lower investment management expenses of
$995,000, lower stock-based compensation of $505,000, partially offset by higher
public company costs of $383,000 and higher miscellaneous expenses of $256,000.

Gain (Loss) on Disposition of Assets and Hotel Properties. Gain (loss) on
disposition of assets and hotel properties changed $38.1 million, from a loss of
$36.7 million in 2020 to a gain of $1.4 million in 2021. The loss in 2020 was
comprised of a $40.4 million loss related to the sale of the Embassy Suites New
York Manhattan Times Square, partially offset by a gain of $3.7 million related
to the sale of the Annapolis Crowne Plaza. The gain in 2021 was primarily
related to a franchise fee reimbursement of $327,000 related to the disposition
of the Embassy Suites New York Manhattan Times Square, a gain of $1.0 million
related to a payment to remove a deed restriction related to the prior
disposition of a building and a gain related to the sale of five WorldQuest
condominiums.

Equity in Earnings (Loss) of Unconsolidated Entities. Equity in loss of
unconsolidated entities was $558,000 in 2021, which consists of our share of
loss from OpenKey of $540,000 and 815 Commerce MM of $18,000. Equity in loss of
unconsolidated entities was $448,000 in 2020, which consists of our share of
loss from OpenKey.

Interest income. Interest income was $207,000 and $672,000 in 2021 and 2020, respectively.

Other Income (Expense). Other income (expense) changed $17.8 million from
expense of $17.0 million in 2020 to income of $760,000 in 2021. In 2021 we
recorded miscellaneous income of $760,000. In 2020, we recorded a realized loss
of $9.6 million related to the terminated CMBX positions, a realized loss of
$9.5 million on interest rate floors and expense of $811,000 from CMBX premiums
and interest paid on collateral. These expenses were partially offset by a
realized gain of $2.3 million on sale of marketable securities, other income of
$585,000 and dividend income of $31,000.

Interest Expense and Amortization of Discounts and Loan Costs. Interest expense
and amortization of discounts and loan costs decreased $91.3 million, or 36.9%,
to $156.1 million in 2021 compared to 2020. The decrease is primarily due to a
decrease of $12.9 million from our Hotel Dispositions, a decrease of $21.5
million at our comparable hotel properties primarily due to lower LIBOR rates,
lower default interest and late charges on mortgage loans previously in default
of $63.2 million and a credit to interest expense in 2021 of $35.7 million
related to the amortization credit of default interest and late charges recorded
on mortgage loans previously in default. These decreases were partially offset
by an increase of $42.1 million attributable to the Oaktree term loan. The
average LIBOR rates in 2021 and 2020 were 0.10% and 0.52%, respectively.

Write-off of Premiums, Loan Costs and Exit Fees. Write-off of premiums, loan
costs and exit fees decreased $3.3 million to $10.6 million in 2021 compared to
2020. In 2021, we recognized Lismore fees of $5.6 million that reflects the
amortization over the service period of the Lismore Agreement (see note 16 to
our consolidated financial statements) and $80,000 related to third-party fees,
totaling $5.7 million. Additionally, we wrote off $4.0 million of debt discount
related to the payment of the PIK interest on the Oaktree financing and
unamortized loan costs in the amount of $839,000. In 2020, we executed several
amendments with various lenders, which included deferral of debt service
payments and allowed the use of reserves for property-level operating shortfalls
and/or to cover debt service payments. Third-party and Lismore fees incurred in
conjunction with these amendments were $1.8 million and $12.1 million,
respectively, totaling $13.8 million. We also wrote-off unamortized loan costs
of $47,000 and incurred other costs of $48,000 as a result of a loan refinance.

Gain (loss) on extinguishment of debt. Gain on extinguishment of debt was $11.9
million in 2021, which primarily related to the foreclosure of the SpringHill
Suites Durham and SpringHill Suites Charlotte in the amount of $10.6 million and
a gain of $1.4 million related to the write off of capitalized default interest
that was being amortized as a credit to interest expense related to the
refinance of the Hilton Boston Back Bay loan.

In 2020, we recorded a gain on extinguishment of debt of $90.3 million. The gain
was comprised of (i) $65.2 million on our $144.2 million mortgage loan secured
by the Columbus Hampton Inn Easton, Canonsburg Homewood Suites Pittsburgh
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Southpointe, Billerica Courtyard, Wichita Courtyard, Washington Hampton Inn
Pittsburgh Meadow Lands, Pittsburgh Hampton Inn Waterfront West Homestead,
Stillwater Residence Inn, and the Phoenix Hampton Inn Airport North; (ii) $4.3
million on our $145.0 million mortgage loan secured by the Embassy Suites New
York Manhattan Times Square; (iii) $1.1 million on our $51.6 million mortgage
loan secured by the W Minneapolis; and (iv) $19.7 million on our $64.0 million
mortgage loan secured by the Courtyard Louisville, Courtyard Ft. Lauderdale and
the Residence Inn Lake Buena Vista.

Unrealized gain (loss) on Marketable securities. Unrealized gain (loss) on marketable securities was $0 and ($1.5) million in 2021 and 2020, respectively, based on changes in market closing prices during the period. All marketable securities were sold in 2020.

Unrealized Gain (Loss) on Derivatives. Unrealized gain on derivatives decreased
$5.5 million from $20.0 million in 2020 to $14.5 million in 2021. In 2021, we
recorded an unrealized gain of $15.8 million from the revaluation of the
embedded debt derivative in the Oaktree Agreement, partially offset by
unrealized losses of $624,000 from interest rate floors and $657,000 from
interest rate caps. In 2020, we recognized an unrealized gain of $10.0 million
on CMBX tranches of which $9.6 million is associated with the recognition of
realized losses, $10.1 million from interest rate floors of which $9.5 million
is associated with the recognition of realized losses from the expiration of
interest rate floors, partially offset by an unrealized loss of $130,000
associated with interest rate caps.

Income tax benefit (expense). Modified income tax benefit (expense) $7.3 milliona tax benefit of $1.3 million in 2020 to an income tax expense of $5.9 million in 2021. This change is mainly due to an increase in the profitability of our TRS entities in 2021 compared to 2020.

(Revenue) Loss of consolidated entities attributable to non-controlling interests. Our non-controlling partner in consolidated entities has been allocated losses of $73,000 and $338,000 in 2021 and 2020, respectively.

Net (Income) Loss Attributable to Redeemable Noncontrolling Interests in
Operating Partnership. Noncontrolling interests in operating partnership were
allocated net losses of $4.0 million and $89.0 million in 2021 and 2020,
respectively. Redeemable noncontrolling interests represented ownership
interests of 0.63% and 8.51% in the operating partnership at December 31, 2021
and 2020, respectively.
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Reverse stock splits

In June 2020, our board of directors approved a reverse stock split of our
issued and outstanding common stock at a ratio of 1-for-10. This reverse stock
split converted every ten issued and outstanding shares of common stock into one
share of common stock. The reverse stock split was effective as of the close of
business on July 15, 2020. As a result of the reverse stock split, the number of
outstanding shares of common stock was reduced from approximately 104.8 million
shares to approximately 10.5 million shares on that date. Additionally, the
number of outstanding common units, Long-Term Incentive Plan ("LTIP") units and
Performance LTIP units was reduced from approximately 20.5 million units to
approximately 2.1 million units on that date. All common stock, common units,
LTIP units, Performance LTIP units, performance stock units and restricted stock
as well as per share data related to these classes of equity have been revised
in the accompanying consolidated financial statements to reflect this reverse
stock split for all periods presented.

On June 28, 2021, our board of directors approved a reverse stock split of our
issued and outstanding common stock at a ratio of 1-for-10. This reverse stock
split converted every ten issued and outstanding shares of common stock into one
share of common stock. The reverse stock split was effective as of the close of
business on July 16, 2021. As a result of the reverse stock split, the number of
outstanding shares of common stock was reduced from approximately 265.1 million
shares to approximately 26.5 million shares on that date. Additionally, the
number of outstanding common units, Long-Term Incentive Plan ("LTIP") units and
Performance LTIP units was reduced from approximately 4.0 million units to
approximately 402,000 units on that date. All common stock, common units, LTIP
units, Performance LTIP units, performance stock units and restricted stock as
well as per share data related to these classes of equity have been revised in
the accompanying consolidated financial statements to reflect this reverse stock
split for all periods presented.

The following sets forth selected data revised for the effects of the 1-for-10
reverse stock splits:

                                                                         Year Ended December 31,
                                           2021               2020                2019                2018                2017

                                                                 (in thousands, except per share amounts)
Statements of Operations Data:

Diluted earnings (loss) per common share:

Net income (loss) attributable to
common stockholders                     $ (12.43)         $ (329.97)      

(1) $(157.74) (1) $(175.20) (1) $(130.16) (1) Weighted average of diluted ordinary shares 21,844

              1,576       

(1) 998 (1) 973 (1) 952 (1)

Other Data:
Cash dividends declared per common
share                                   $      -          $       -           $   30.00       (1) $   48.00       (1) $   48.00       (1)


____________________

(1) Amounts revised for the effects of reverse stock splits at the rate of 1 for 10.

CASH AND CAPITAL RESOURCES

Liquidity

In December 2019, COVID-19 was identified in Wuhan, China, subsequently spread
to other regions of the world, and resulted in significant travel restrictions
and extended shutdown of numerous businesses throughout the United States. In
March 2020, the World Health Organization declared COVID-19 to be a global
pandemic. Beginning in late February 2020, we experienced a significant decline
in occupancy and RevPAR and we expect the occupancy and RevPAR declines
associated with COVID-19 to continue. The prolonged presence of the virus
resulted in health and other government authorities imposing widespread
restrictions on travel and other businesses.

On January 15, 2021, the Company entered into the Credit Agreement with Oaktree
comprised of (a) initial term loans in an aggregate principal amount of
$200 million, (b) Initial DDTL in an aggregate principal amount of up to
$150 million and (c) Additional DDTL in an aggregate principal amount of up to
$100 million. On October 12, 2021, the Company and Ashford Trust OP entered into
Amendment No. 1 to the Oaktree Credit Agreement (Original Credit Agreement, as
amended thereby, the "Credit Agreement"). See note 7 to our consolidated
financial statements.

As of December 31, 2021, the Company held cash and cash equivalents of $592.1
million and restricted cash of $99.5 million. The vast majority of the
restricted cash comprises lender and manager held reserves. During 2020, the
Company worked with its property managers and lenders in order to utilize lender
and manager held reserves to fund operating shortfalls. The Company continues to
have discussions with one of its lenders about a potential loan modification on
its property level
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debt. At December 31, 2021, there was also $26.9 million due to the Company from
third-party hotel managers, which is primarily the Company's cash held by one of
its property managers which is also available to fund hotel operating costs.

On November 23, 2021, the Company announced that its board of directors declared
cash dividends on the Company's 8.45% Series D Cumulative Preferred Stock,
7.375% Series F Cumulative Preferred Stock, 7.375% Series G Cumulative Preferred
Stock, 7.50% Series H Cumulative Preferred Stock, and 7.50% Series I Cumulative
Preferred Stock reflecting accrued and unpaid dividends for the quarters ending
June 30, 2020, September 30, 2020, December 31, 2020, March 31, 2021, June 30,
2021, and September 30, 2021. The board of directors also declared cash
dividends on the Company's 8.45% Series D Cumulative Preferred Stock, 7.375%
Series F Cumulative Preferred Stock, 7.375% Series G Cumulative Preferred Stock,
7.50% Series H Cumulative Preferred Stock, and 7.50% Series I Cumulative
Preferred Stock for the quarter ended December 31, 2021. The Company has
continued the suspension of its common stock dividend into 2022 in light of the
ongoing uncertainty from the COVID-19 pandemic and to protect liquidity.

We cannot predict when hotel operating levels will return to normalized levels
after the effects of the pandemic subside, whether our hotels will be forced to
shut down operations or whether one or more possible recurrences of COVID-19
case surges could result in further reductions in business and personal travel
or potentially cause state and local governments to reinstate travel
restrictions. Facts and circumstances could change in the future that are
outside of management's control, such as additional government mandates, health
official orders, travel restrictions and extended business shutdowns due to
COVID-19.

Based on our current level of operations, our cash flow from operations and our
existing cash balances should be adequate to meet upcoming anticipated
requirements for interest and principal payments on debt (excluding any
potential final maturity payments), working capital, and capital expenditures
for the next 12 months and dividends required to maintain our status as a REIT
for U.S. federal income tax purposes. With respect to upcoming maturities, no
assurances can be given that we will be able to refinance our upcoming
maturities. Additionally, no assurances can be given that we will obtain
additional financings or, if we do, what the amount and terms will be. Our
failure to obtain future financing under favorable terms could adversely impact
our ability to execute our business strategy or may result in lender
foreclosure.

Our cash position from operations is affected primarily by macro industry
movements in occupancy and rate as well as our ability to control costs.
Further, interest rates can greatly affect the cost of our debt service as well
as the value of any financial hedges we may put in place. We monitor industry
fundamentals and interest rates very closely. Capital expenditures above our
reserves will affect cash flow as well.

Certain of our loan agreements contain cash trap provisions that may be
triggered if the performance of our hotels decline below a threshold. When these
provisions are triggered, substantially all of the profit generated by our
hotels is deposited directly into lockbox accounts and then swept into cash
management accounts for the benefit of our various lenders. During a cash trap,
certain disbursements from these hotel operating cash receipts, primarily other
corporate general and administrative expenditures, would require consent of our
lenders. These cash trap provisions have been triggered on nearly all of our
mortgage loans containing cash trap provisions. As of December 31, 2021, 93% of
our hotels were in cash traps and approximately $4.9 million of our restricted
cash was subject to these cash traps. Our loans may remain subject to cash trap
provisions for a substantial period of time which could limit our flexibility
and adversely affect our financial condition or our qualification as a REIT.

We have extension options relating to certain property level loans that will
permit us to extend the maturity date of our loans if certain conditions are
satisfied at the respective extension dates, including the achievement of debt
yield targets required in order to extend such loans. To the extent we decide to
extend the maturity date of the debt outstanding under the loans, we may be
required to prepay a significant amount of the loans in order to meet the
required debt yield targets. There can be no assurances that we will be able to
meet the conditions for extensions pursuant to the respective terms of such
loans.

We are required to maintain certain financial ratios under various debt and
related agreements. If we violate covenants in any debt or related agreement, we
could be required to repay all or a portion of our indebtedness before maturity
at a time when we might be unable to arrange financing for such repayment on
attractive terms, if at all. The assets of certain of our subsidiaries are
pledged under non-recourse indebtedness and are not available to satisfy the
debts and other obligations of Ashford Trust or Ashford Trust OP, our operating
partnership, and the liabilities of such subsidiaries do not constitute the
obligations of Ashford Trust or Ashford Trust OP. As of February 24, 2022, the
Company is not expecting to be required to repay all or a portion of our
indebtedness before maturity.

Mortgage and mezzanine loans are nonrecourse to the borrowers, except for
customary exceptions or carve-outs that trigger recourse liability to the
borrowers in certain limited instances. Recourse obligations typically include
only the payment of costs and liabilities suffered by lenders as a result of the
occurrence of certain bad acts on the part of the borrower. However, in
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certain cases, carve-outs could trigger recourse obligations on the part of the
borrower with respect to repayment of all or a portion of the outstanding
principal amount of the loans. We have entered into customary guaranty
agreements pursuant to which we guaranty payment of any recourse liabilities of
the borrowers that result from non-recourse carve-outs (which include, but are
not limited to, fraud, misrepresentation, willful conduct resulting in waste,
misappropriations of rents following an event of default, voluntary bankruptcy
filings, unpermitted transfers of collateral, and certain environmental
liabilities). In the opinion of management, none of these guaranty agreements,
either individually or in the aggregate, are likely to have a material adverse
effect on our business, results of operations, or financial condition.

We have entered into certain customary guaranty agreements pursuant to which we
guaranty payment of any recourse liabilities of our subsidiaries or joint
ventures that may result from non-recourse carve-outs, which include, but are
not limited to, fraud, misrepresentation, willful misconduct resulting in waste,
misappropriations of rents following an event of default, voluntary bankruptcy
filings, unpermitted transfers of collateral, delinquency of trade payables and
certain environmental liabilities. Certain of these guarantees represent a
guaranty of material amounts, and if we are required to make payments under
those guarantees, our liquidity could be adversely affected.

We are committed to an investment strategy where we will pursue hotel-related
investments as suitable situations arise. Funds for future hotel-related
investments are expected to be derived, in whole or in part, from cash on hand,
future borrowings under a credit facility or other loans, or proceeds from
additional issuances of common stock, preferred stock, or other securities,
asset sales, and joint ventures. However, we have no formal commitment or
understanding to invest in additional assets, and there can be no assurance that
we will successfully make additional investments. We may, when conditions are
suitable, consider additional capital raising opportunities.

Our existing hotel properties are mostly located in developed areas with
competing hotel properties. Future occupancy, ADR, and RevPAR of any individual
hotel could be materially and adversely affected by an increase in the number or
quality of competitive hotel properties, home sharing companies or apartment
operators offering short-term rentals in its market area. Competition could also
affect the quality and quantity of future investment opportunities.

Our estimated future obligations as of December 31, 2021 include both current
and long-term obligations. With respect to our indebtedness, as discussed in
note 7 to our consolidated financial statements, we have current obligations of
$3.3 billion and long-term obligations of $628.6 million. As of December 31,
2021, we held extension options for all our mortgage loans due in the next
twelve months. We have amortization payments of approximately $6.7 million due
in the next twelve months.

As noted in Note 18 to our consolidated financial statements, under our operating leases, we have present obligations to $2.9 million and the long-term obligations of $190.1 million. In addition, we have short-term capital commitments of $38.9 million.

Debt operations

On January 15, 2021, the Company entered into the Oaktree Credit Agreement (as
amended) with Oaktree and the Administrative Agent. The Oaktree Credit Agreement
provides that, subject to the conditions set forth therein, Oaktree will make
available to the borrower a senior secured term loan facility comprised of (a)
initial term loans (the "Initial Term Loan") in an aggregate principal amount of
$200 million, (b) initial delayed draw term loans in an aggregate principal
amount of up to $150 million (the "Initial DDTL") and (c) additional delayed
draw term loans in an aggregate principal amount of up to $100 million (the
"Additional DDTL," and together with the Initial Term Loan and the Initial DDTL,
collectively, the "Loans"), in each case to fund general corporate operations of
the Company and its subsidiaries.

The Loans under the Oaktree Credit Agreement will bear interest (a) with respect
to the Initial Term Loan and the Initial DDTL, at an annual rate equal to 16%
for the first two years, reducing to 14% thereafter and (b) with respect to the
Additional DDTL, at an annual rate equal to 18.5% for the first two years,
reducing to 16.5% thereafter. Interest payments on the Loans will be due and
payable in arrears on the last business day of March, June, September and
December of each calendar year and the maturity date. For the first two years
following the closing of the Oaktree Credit Agreement, the borrower will have
the option to pay accrued interest "in kind" by adding such amount of accrued
interest to the outstanding principal balance of the Loans (such interest, "PIK
Interest"). The initial maturity date of the Oaktree Credit Agreement (the
"Maturity Date") shall be three years, with two optional one-year extensions
subject to satisfaction of certain terms and conditions. The Lenders shall,
subject to certain terms, have the ability to make protective advances to the
borrower pursuant to the terms of the Oaktree Credit Agreement to cure defaults
with respect to mortgage and mezzanine-level indebtedness of subsidiaries of the
borrower having principal balances in excess of $400 million.

At February 9, 2021the Company entered into an agreement regarding existing defaults and extension options for the MS 17 Pool Loan pursuant to which (a) the Company paid the lender all outstanding and outstanding debt service and tax reserve

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contributions, and (b) the lender suspended all FF&E reserve contributions (for
the furniture, fixtures and equipment reserve accounts generally reserved to
finance capital improvements to the property) through December 2021.
Additionally, the modification agreement lowers the debt yield extension test
for the fifth extension option from 10.38% to 8.0%. Finally, the forbearance
agreement provides that the second extension option is deemed exercised as of
November 9, 2020.

In February 2021, the Company was informed by its lender that it had initiated
foreclosure proceedings for the foreclosure of the SpringHill Suites Durham and
SpringHill Suites Charlotte, which secured the Company's $19.4 million mortgage
loan. The foreclosure proceedings were completed on April 29, 2021.

On August 25, 2021, we refinanced our $97.0 million mortgage loan, secured by
the Hilton Boston Back Bay in Boston, Massachusetts. The new mortgage loan
totals $98.0 million and provides for an interest rate of LIBOR + 3.80%. The
mortgage loan has a four-year term with a one-year extension option, subject to
the satisfaction of certain conditions. The mortgage loan is secured by the
Hilton Boston Back Bay.

On October 12, 2021, the Company entered into Amendment No. 1. to the Oaktree
Credit Agreement with Oaktree and the Administrative Agent. Amendment No. 1 to
the Oaktree Credit Agreement, subject to the conditions set forth therein, among
other items: (i) extends the commitment period of the Initial DDTL and
Additional DDTL from 30 months to 42 months after the initial closing date of
the Oaktree Credit Agreement, if the Initial Term Loans are repaid in full prior
to the expiration of such commitment period (the "DDTL Commitment Period"); (ii)
suspends the Company's obligations to comply with certain covenants during the
DDTL Commitment Period if no Loans or accrued interest thereon are outstanding;
(iii) suspends the Company's obligation to subordinate fees due under the
advisory agreement if at any point there is no accrued paid-in-kind interest
outstanding or any accrued dividends on any of the Company's preferred stock and
the Company has sufficient unrestricted cash to repay in full all outstanding
Loans; (iv) permits Oaktree to, at any time, elect to receive the exit fee in
warrants for the purchase of common stock of the Company equal to 19.9% of all
common stock outstanding on the closing date of the Oaktree Credit Agreement
subject to certain upward or downward adjustments; and (v) provides that in the
event prior to the termination of the Oaktree Credit Agreement, Oaktree elects
to receive the exit fee in warrants and any of such warrants are sold at a price
per share of common stock in excess of $40, all obligations owing to Oaktree
shall be reduced by an amount equal to 25% of the amount of such excess
consideration, subject to certain adjustments. On November 19, 2021, the Company
entered into a Limited Waiver to the Oaktree Credit Agreement (the "Limited
Waiver") with the guarantors party thereto, Oaktree and the Administrative
Agent. Pursuant to the Limited Waiver, Oaktree and the Administrative Agent
waived the Company's obligation to comply with the negative covenant set forth
in the Oaktree Credit Agreement insofar as such negative covenant prohibits the
declaration of any Restricted Payment (as defined in the Credit Agreement)
constituting current or accrued dividends on the Company's preferred stock on or
before November 30, 2021. As a result of the Limited Waiver, effective November
19, 2021, the Company is permitted to declare current and accrued dividends on
the Company's preferred stock so long as such declared dividends are not made or
paid until after November 30, 2021, and (i) no PIK Principal is then
outstanding, and (ii) the aggregate amount of Unrestricted Cash (as defined in
the Oaktree Credit Agreement), after giving effect to such Restricted Payment
constituting current and accrued dividends on the Company's preferred stock, is
not less than an amount equal to the sum of (x) $100,000,000 plus (y) the
aggregate principal amount of delayed draw term loans advanced prior to the date
thereof or contemporaneously therewith.

On November 1, 2021, we refinanced our $78.6 million mortgage loan, secured by
the Marriott Gateway Crystal City in Arlington, Virginia. The new mortgage loan
totals $86.0 million. The initial funding for the loan was $84.0 million, with
the additional $2.0 million available to fund debt service for the first 30
months of the loan, if needed. The new mortgage loan is interest only and
provides for an interest rate of LIBOR + 4.65%. The mortgage loan has a
three-year term with two one-year extension options, subject to the satisfaction
of certain conditions. The mortgage loan is secured by the Marriott Gateway
Crystal City.

At November 23, 2021have been paid $23.4 million principal associated with interest paid in kind that had been capitalized into the principal balance of the term loan associated with the Oaktree credit agreement.

Stock trading

On December 5, 2017, the board of directors reapproved a stock repurchase
program (the "Repurchase Program") pursuant to which the board of directors
granted a repurchase authorization to acquire shares of the Company's common
stock, par value $0.01 per share having an aggregate value of up to $200
million. The board of directors' authorization replaced any previous repurchase
authorizations. No shares were repurchased during the years ended December 31,
2021. 2020 and 2019 pursuant to the Repurchase Program.

From January 1, 2021 by February 24, 2022the Company has entered into privately negotiated exchange agreements with certain holders of its 8.45% Series D Cumulative Preferred Shares, par $0.01 per share, 7.375% Series F Cumulative

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Preferred Stock, par value $0.01 per share, 7.375% Series G Cumulative Preferred
Stock, par value $0.01 per share, 7.50% Series H Cumulative Preferred Stock, par
value $0.01 per share and 7.50% Series I Cumulative Preferred Stock, par value
$0.01 per share in reliance on Section 3(a)(9) of the Securities Act. Prior to
the reverse stock split, during the period from January 1, 2021 through July 15,
2021, the Company exchanged a total of 59.7 million shares of its common stock
for an aggregate of 7.7 million shares of preferred stock. After the reverse
stock split the shares of common stock were adjusted to approximately 6.0
million. During the period from July 16, 2021 through February 24, 2022, the
Company exchanged a total of approximately 1.8 million shares of its common
stock for an aggregate of approximately 978,000 shares of preferred stock.

On December 7, 2020, the Company and Lincoln Park Capital Fund, LLC ("Lincoln
Park"), entered into a purchase agreement (the "First Lincoln Park Purchase
Agreement"). Upon entering into the First Lincoln Park Purchase Agreement, the
Company issued 19,084 shares of common stock as consideration for Lincoln Park's
execution and delivery of the First Lincoln Park Purchase Agreement. Under the
First Lincoln Park Purchase Agreement, the Company issued approximately 1.0
million shares of common stock for gross proceeds of approximately $25.1 million
for the year ended December 31, 2021. As of December 31, 2021, all shares
available under the First Lincoln Park Purchase Agreement were sold.

On January 22, 2021, the Company entered into a Standby Equity Distribution
Agreement (the "SEDA") with YA II PN, Ltd., ("YA"), pursuant to which the
Company will be able to sell up to 1.4 million shares of the Company's common
stock at the Company's request any time during the commitment period. The
Company has issued approximately 1.4 million shares of common stock for gross
proceeds of approximately $40.6 million under the SEDA. As of December 31, 2021,
all shares available under the SEDA were sold.

On March 12, 2021, the Company and Lincoln Park entered into a Second Lincoln
Park Purchase Agreement (the "Second Lincoln Park Purchase Agreement"), which
provided that subject to the terms and conditions set forth therein, the Company
may issue or sell to Lincoln Park up to approximately 2.1 million shares of the
Company's common stock, from time to time during the term of the Second Lincoln
Park Purchase Agreement. Upon entering into the Second Lincoln Park Purchase
Agreement, the Company issued 16,266 shares of common stock as consideration for
Lincoln Park's execution and delivery of the Purchase Agreement. The Company has
issued approximately 2.0 million shares of common stock for gross proceeds of
approximately $43.4 million under the Second Lincoln Park Purchase Agreement. As
of December 31, 2021, all shares available under the Second Lincoln Park
Purchase Agreement were sold.

On May 17, 2021, the Company and Keystone Capital Partners, LLC ("Keystone")
entered into a common stock purchase agreement (the "Keystone Purchase
Agreement"), which provides that subject to the terms and conditions set forth
therein, the Company may sell to Keystone up to approximately 3.1 million shares
of the Company's common stock, from time to time during the term of the Keystone
Purchase Agreement. Upon entering into the Keystone Purchase Agreement, the
Company issued 40,323 shares of common stock as consideration for Keystone's
execution and delivery of the Keystone Purchase Agreement. The Company issued
approximately 3.1 million shares of common stock for gross proceeds of
approximately $148.0 million. As of December 31, 2021, all shares available
under the Keystone Purchase Agreement were sold.

On June 7, 2021, the Company entered into a second Standby Equity Distribution
Agreement (the "Second YA SEDA") with YA, pursuant to which the Company will be
able to sell up to approximately 3.8 million shares of its common stock from
time to time during the term of the Second YA SEDA. As of February 24, 2022, the
Company has issued approximately 3.8 million shares of common stock for gross
proceeds of approximately $165.4 million under the Second YA SEDA. As of
December 31, 2021, all shares available under the Second YA SEDA were sold.

On June 18, 2021, the Company and Seven Knots, LLC ("Seven Knots) entered into a
purchase agreement (the "Seven Knots Purchase Agreement"), which provides that
subject to the terms and conditions set forth therein, the Company may sell to
Seven Knots up to approximately 4.0 million shares of common stock of the
Company, from time to time during the term of the Seven Knots Purchase
Agreement. As of February 24, 2022, the Company has issued approximately
4.0 million shares of common stock for gross proceeds of approximately
$81.3 million under the Seven Knots Purchase Agreement. As of December
31, 2021, all shares available under the Seven Knots Purchase Agreement were
sold.

On July 2, 2021, the Company and B. Riley Principal Capital, LLC ("B. Riley")
entered into a purchase agreement (the "B. Riley Purchase Agreement"), which
provides that subject to the terms and conditions set forth therein, the Company
may sell to B. Riley up to approximately 4.6 million shares of common stock,
from time to time during the term of the B. Riley Purchase Agreement. As of
February 24, 2022, the Company has issued approximately 4.6 million shares of
common stock for gross proceeds of approximately $68.0 million under the B.
Riley Purchase Agreement. As of December 31, 2021, all shares available under
the B. Riley Purchase Agreement were sold.

On September 9, 2021, the Company and M3A LP ("M3A") entered into a purchase
agreement (the "M3A Purchase Agreement"), which provides that subject to the
terms and conditions set forth therein, the Company may sell to M3A up to
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approximately 6.0 million shares of common stock, from time to time during the
term of the M3A Purchase Agreement. As of February 24, 2022, the Company has
issued approximately 900,000 shares of common stock for gross proceeds of
approximately $12.9 million under the M3A Purchase Agreement.

Sources and uses of species

Our principal sources of funds to meet our cash requirements include cash on
hand, cash flow from operations, capital market activities, property refinancing
proceeds and asset sales. Additionally, our principal uses of funds are expected
to include possible operating shortfalls, owner-funded capital expenditures,
dividends, new investments, and debt interest and principal payments. Items that
impacted our cash flow and liquidity during the periods indicated are summarized
as follows:

Net Cash Flows Provided by (Used in) Operating Activities. Net cash flows
provided by (used in) operating activities, pursuant to our consolidated
statements of cash flows, which includes changes in balance sheet items, were
$(144.2) million and $(149.5) million for the years ended December 31, 2021 and
2020, respectively. Cash flows used in operations were impacted by the COVID-19
pandemic, changes in hotel operations, our hotel dispositions in 2020 and 2021
as well as the timing of collecting receivables from hotel guests, paying
vendors, settling with derivative counterparties, settling with related parties
and settling with hotel managers.

Net Cash Flows Provided by (Used in) Investing Activities. For the year ended
December 31, 2021, net cash flows used in investing activities were $34.0
million. Cash outflows consisted of $36.7 million for capital improvements made
to various hotel properties and $9.0 million of investments in unconsolidated
entities partially offset by cash inflows of $9.0 million from proceeds received
primarily from the sale of the Le Meridien Minneapolis and $2.8 million of
proceeds from property insurance.

For the year ended December 31, 2020, net cash flows used in investing
activities were $7.6 million. Cash outflows primarily consisted of $46.2 million
for capital improvements made to various hotel properties, $1.1 million for the
acquisition of meeting space adjacent to the Nashville Renaissance and a
$430,000 investment in OpenKey. Cash outflows were partially offset by $38.8
million from proceeds received from the sale of the Crowne Plaza Annapolis and
Embassy Suites New York Manhattan Times Square and $1.4 million of proceeds from
property insurance.

Net Cash Flows Provided by (Used in) Financing Activities. For the year ended
December 31, 2021, net cash flows provided by financing activities were $702.6
million. Cash inflows consisted of $377.5 million from borrowings on
indebtedness, net of commitment fee and $562.8 million of net proceeds from
issuances of common stock, partially offset by cash outflows of $189.6 million
for repayments of indebtedness, $27.8 million for payments of loan costs and
exit fees, $18.6 million of payments for preferred dividends, $1.5 million of
payments for derivatives and $200,000 for the acquisition of the remaining 15%
noncontrolling interest in consolidated entities.

For the year ended December 31, 2020, net cash flows used in financing
activities were $73.8 million. Cash outflows primarily consisting of $137.8
million for repayments of indebtedness, $28.6 million for dividend payments to
common and preferred stockholders and unitholders and $26.7 million for payments
of loan costs and exit fees, partially offset by cash inflows of $88.0 million
from borrowings on indebtedness and $31.9 million of proceeds from sales of
common stock.

Dividend Policy. Distributions are authorized by our board of directors and
declared by us based upon a variety of factors deemed relevant by our directors.
The board of directors will continue to review our distribution policy on at
least a quarterly basis. Our ability to pay distributions to our preferred or
common stockholders will depend, in part, upon our receipt of distributions from
our operating partnership. This, in turn, may depend upon receipt of lease
payments with respect to our properties from indirect subsidiaries of our
operating partnership, the management of our properties by our hotel managers
and general business conditions (including the impact of the COVID-19 pandemic).
Distributions to our stockholders are generally taxable to our stockholders as
ordinary income. However, since a portion of our investments are equity
ownership interests in hotels, which result in depreciation and non-cash charges
against our income, a portion of our distributions may constitute a non-taxable
return of capital, to the extent of a stockholder's tax basis in the stock. To
the extent that it is consistent with maintaining our REIT status, we may
maintain accumulated earnings of Ashford TRS in that entity.

On December 7, 2021, our board of directors reviewed and approved our 2022
dividend policy. We do not anticipate paying any dividends on our outstanding
common stock for any quarter during 2022 and expect to pay dividends on our
outstanding Preferred Stock during 2022. Our board of directors will continue to
review our dividend policy and make future announcements with respect thereto.
We may incur indebtedness to meet distribution requirements imposed on REITs
under the Code to the extent that working capital and cash flow from our
investments are insufficient to fund required distributions.
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We may incur debt to meet distribution requirements imposed on REITs under the Code to the extent that working capital and cash flows from our investments are insufficient to fund the required distributions. We can pay dividends in excess of our cash flow.

INFLATION

We rely entirely on the performance of our hotel properties and the ability of
the hotel properties' managers to increase revenues to keep pace with inflation.
Hotel operators can generally increase room rates, but competitive pressures may
limit their ability to raise rates faster than inflation. Our general and
administrative costs, real estate and personal property taxes, property and
casualty insurance, labor costs and utilities are subject to inflation as well.

SEASONALITY

Our properties' operations historically have been seasonal as certain properties
maintain higher occupancy rates during the summer months, while certain other
properties maintain higher occupancy rates during the winter months. This
seasonality pattern can cause fluctuations in our quarterly revenue. Quarterly
revenue also may be adversely affected by renovations and repositionings, our
managers' effectiveness in generating business and by events beyond our control,
such as the COVID-19 pandemic and government-issued travel restrictions in
response, extreme weather conditions, natural disasters, terrorist attacks or
alerts, civil unrest, government shutdowns, airline strikes or reduced airline
capacity, economic factors and other considerations affecting travel. To the
extent that cash flows from operations are insufficient during any quarter to
enable us to make quarterly distributions to maintain our REIT status due to
temporary or seasonal fluctuations in lease revenue, we expect to utilize cash
on hand, cash generated through borrowings and issuances of common stock to fund
required distributions. However, we cannot make any assurances that we will make
distributions in the future.

CRITICAL ACCOUNTING POLICIES

Our significant accounting policies are fully described in note 2 to our
consolidated financial statements included in Item 8. Financial Statements and
Supplementary Data. We believe that the following discussion addresses our most
critical accounting policies, representing those policies considered most vital
to the portrayal of our financial condition and results of operations and
require management's most difficult, subjective, and complex judgments.

Impairment of Investments in Hotel Properties-Hotel properties are reviewed for
impairment whenever events or changes in circumstances indicate that their
carrying amounts may not be recoverable. Recoverability of the hotel is measured
by comparison of the carrying amount of the hotel to the estimated future
undiscounted cash flows, which take into account current market conditions and
our intent with respect to holding or disposing of the hotel. If our analysis
indicates that the carrying value of the hotel is not recoverable on an
undiscounted cash flow basis, we recognize an impairment charge for the amount
by which the property's net book value exceeds its estimated fair value, or fair
value, less cost to sell. In evaluating impairment of hotel properties, we make
many assumptions and estimates, including projected cash flows, expected holding
period, and expected useful life. Fair value is determined through various
valuation techniques, including internally developed discounted cash flow
models, comparable market transactions and third-party appraisals, where
considered necessary. We recorded impairment charges of $0, $91.7 million and
$33.6 million for the years ended December 31, 2021, 2020 and 2019,
respectively. See note 5 to our consolidated financial statements.

Income Taxes-As a REIT, we generally are not subject to federal corporate income
tax on the portion of our net income (loss) that does not relate to taxable REIT
subsidiaries. However, Ashford TRS is treated as a TRS for U.S. federal income
tax purposes. In accordance with authoritative accounting guidance, we account
for income taxes related to Ashford TRS using the asset and liability method
under which deferred tax assets and liabilities are recognized for future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases. In addition, the analysis utilized by us in determining our deferred tax
asset valuation allowance involves considerable management judgment and
assumptions. See note 19 to our consolidated financial statements.

At December 31, 2021 and 2020, we recorded a valuation allowance of $38.8
million and $40.0 million, respectively on the net deferred tax assets of our
taxable REIT subsidiaries. At each reporting date, we evaluate whether it is
more likely than not that we will utilize all or a portion of our deferred tax
assets. We consider all available positive and negative evidence, including
historical results of operations, projected future taxable income, carryback
potential and scheduled reversals of deferred tax liabilities. At December 31,
2021, we had TRS net operating loss carryforwards for U.S. federal income tax
purposes of $119.9 million, of which $10.1 million is subject to expiration and
will begin to expire in 2022. The remainder was generated after December 31,
2017 and is not subject to expiration under the Tax Cuts and Jobs Act. The loss
carryforwards subject to expiration may be available to offset future taxable
income, if any, in 2022 through 2027, with the remainder available to offset
taxable income beyond 2027. The net operating loss carryforwards are subject to
substantial limitation on
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their use. Management determined that it is more likely than not that as of
December 31, 2021, $38.8 million of our net deferred tax assets will not be
realized, and a valuation allowance has been recorded accordingly. At December
31, 2021, Ashford Hospitality Trust, Inc., our REIT, had net operating loss
carryforwards for U.S. federal income tax purposes of $885.2 million based on
the latest filed tax returns. Of that amount, $426.1 million will begin to
expire in 2023 and is available to offset future taxable income, if any, through
2036. The remainder was generated after December 31, 2017 and is not subject to
expiration under the Tax Cuts and Jobs Act. The net operating loss carryforwards
are subject to substantial limitation on their use.

The "Income Taxes" topic of the Financial Accounting Standards Board's ("FASB")
Accounting Standards Codification addresses the accounting for uncertainty in
income taxes recognized in an enterprise's financial statements. The guidance
requires us to determine whether tax positions we have taken or expect to take
in a tax return are more likely than not to be sustained upon examination by the
appropriate taxing authority based on the technical merits of the positions. Tax
positions that do not meet the more likely than not threshold would be recorded
as additional tax expense in the current period. We analyze all open tax years,
as defined by the statute of limitations for each jurisdiction, which includes
the federal jurisdiction and various states. We classify interest and penalties
related to underpayment of income taxes as income tax expense. We and our
subsidiaries file income tax returns in the U.S. federal jurisdiction and
various states and cities. Tax years 2017 through 2021 remain subject to
potential examination by certain federal and state taxing authorities.

RECENTLY ADOPTED ACCOUNTING STANDARDS

In January 2020, the FASB issued Accounting Standards Updates ("ASU") 2020-01,
Investments - Equity Securities (Topic 321), Investments-Equity Method and Joint
Ventures (Topic 323), and Derivatives and Hedging (Topic 815) - Clarifying the
Interactions between Topic 321, Topic 323, and Topic 815 (a consensus of the
Emerging Issues Task Force) ("ASU 2020-01"), which clarifies the interaction
between the accounting for equity securities, equity method investments, and
certain derivative instruments. The ASU, among other things, clarifies that a
company should consider observable transactions that require a company to either
apply or discontinue the equity method of accounting under Topic 323,
Investments-Equity Method and Joint Ventures, for the purposes of applying the
measurement alternative in accordance with Topic 321 immediately before applying
or upon discontinuing the equity method. ASU 2020-01 is effective for fiscal
years beginning after December 15, 2020, and interim periods within those fiscal
years and should be applied prospectively. We adopted the standard effective
January 1, 2021, and the adoption of this standard did not have a material
impact on our consolidated financial statements.

RECENTLY ISSUED ACCOUNTING STANDARDS

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848)
("ASU 2020-04"). ASU 2020-04 contains practical expedients for reference rate
reform-related activities that impact debt, leases, derivatives and other
contracts. The guidance in ASU 2020-04 is optional and may be elected over time
as reference rate reform activities occur. The Company continues to evaluate the
impact of the guidance and may apply the elections as applicable as changes in
the market occur.

In August 2020, the FASB issued ASU 2020-06, Debt - Debt with Conversion and
Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in
Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments
and Contracts in an Entity's Own Equity ("ASU 2020-06"), which simplifies the
accounting for certain financial instruments with characteristics of liabilities
and equity. This ASU (1) simplifies the accounting for convertible debt
instruments and convertible preferred stock by removing the existing guidance in
Accounting Standards Codification ("ASC") 470-20, Debt: Debt with Conversion and
Other Options, that requires entities to account for beneficial conversion
features and cash conversion features in equity, separately from the host
convertible debt or preferred stock; (2) revises the scope exception from
derivative accounting in ASC 815-40 for freestanding financial instruments and
embedded features that are both indexed to the issuer's own stock and classified
in stockholders' equity, by removing certain criteria required for equity
classification; and (3) revises the guidance in ASC 260, Earnings Per Share, to
require entities to calculate diluted earnings per share ("EPS") for convertible
instruments by using the if-converted method. In addition, entities must presume
share settlement for purposes of calculating diluted EPS when an instrument may
be settled in cash or shares. We plan to adopt ASU 2020-06 effective January 1,
2022, and do not expect the adoption to have a material impact on our
consolidated financial statements and related disclosures.

NON-GAAP FINANCIAL MEASURES

The following non-GAAP presentations of EBITDA, EBITDAre, Adjusted EBITDAre, funds from operations (“FFO”) and Adjusted FFO are provided to assist our investors in evaluating our operating performance.

EBITDA is defined as net income (loss) before interest expense and amortization
of discounts and loan costs, net, income taxes, depreciation and amortization,
as adjusted to reflect only the Company's portion of EBITDA of unconsolidated
entities. In addition, we exclude impairment charges on real estate, and
gain/loss on disposition of assets and hotel properties and gain/loss of
unconsolidated entities to calculate EBITDAre, as defined by NAREIT.
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We then further adjust EBITDAre to exclude certain additional items such as
gain/loss on insurance settlements, write-off of premiums, loan costs and exit
fees, other income/expense, net, transaction and conversion costs, legal,
advisory and settlement costs, dead deal costs, uninsured remediation costs,
advisory services incentive fee and non-cash items such as amortization of
unfavorable contract liabilities, gain/loss on extinguishment of debt, non-cash
stock/unit-based compensation, unrealized gains/losses on marketable securities
and derivative instruments, as well as our portion of adjustments to EBITDAre of
unconsolidated entities.

We present EBITDA, EBITDAre and Adjusted EBITDAre because we believe they
reflect more accurately the ongoing performance of our hotel assets and other
investments and provide more useful information to investors as they are
indicators of our ability to meet our future debt payment requirements, working
capital requirements and they provide an overall evaluation of our financial
condition. EBITDA, EBITDAre and Adjusted EBITDAre as calculated by us may not be
comparable to EBITDA, EBITDAre and Adjusted EBITDAre reported by other companies
that do not define EBITDA, EBITDAre and Adjusted EBITDAre exactly as we define
the terms. EBITDA, EBITDAre and Adjusted EBITDAre do not represent cash
generated from operating activities determined in accordance with GAAP, and
should not be considered as an alternative to operating income (loss) or net
income (loss) determined in accordance with GAAP as an indicator of performance
or as an alternative to cash flows from operating activities as determined by
GAAP as an indicator of liquidity.

The following table reconciles net income (loss) to EBITDA, EBITDAre and Adjusted EBITDAre (in thousands):

Year ended the 31st of December,

                                                                                    2021                2020                2019
Net income (loss)                                                           

($271,048) $(633,222) ($142,679)
Interest charges and amortization of discounts and borrowing costs

                      156,119             247,381             262,001
Depreciation and amortization                                                      218,851                252,765             269,003
Income tax expense (benefit)                                                         5,948              (1,335)              1,218
Equity in (earnings) loss of unconsolidated entities                                   558                 448               2,307

Share of the company in the EBITDA of non-consolidated entities (Ashford Inc.)

                                                                                    -                   -               4,336
Company's portion of EBITDA of unconsolidated entities (OpenKey)                      (554)               (446)               (403)
EBITDA                                                                             109,874            (134,409)            395,783
Impairment charges on real estate                                                        -              91,721              33,628
(Gain) loss on disposition of assets and hotel properties                             (449)             36,680             (26,126)

EBITDAre                                                                           109,425              (6,008)            403,285
Amortization of unfavorable contract liabilities                                       211                 227                 176

(Gain) loss on insurance settlements                                                     -                (625)               (450)

Write-off of premiums, loan costs and exit fees                                     10,612              13,867               2,841
(Gain) loss on extinguishment of debt                                              (11,896)            (90,349)                  -
Other (income) expense, net                                                         (1,760)             17,029             (10,219)
Transaction and conversion costs                                                     3,033              16,309               2,329
Legal, advisory and settlement costs                                                 7,371               1,409               1,660
Unrealized (gain) loss on marketable securities                                          -               1,467              (1,896)
Unrealized (gain) loss on derivatives                                              (14,493)            (19,950)              4,494
Dead deal costs                                                                        689                 923                  78
Uninsured remediation costs                                                            341                   -                   -
Non-cash stock/unit-based compensation                                              10,095              10,746              19,717

Company’s share of EBITDA adjustments relate to non-consolidated entities (Ashford Inc.)

                                                                  -                   -               2,941
Company's portion of adjustments to EBITDAre of unconsolidated
entities (OpenKey)                                                                      16                  28                  49
Adjusted EBITDAre                                                               $  113,644          $  (54,927)         $  425,005


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We calculate FFO and Adjusted FFO in the following table. FFO is calculated on
the basis defined by NAREIT, which is net income (loss) attributable to common
stockholders, computed in accordance with GAAP, excluding gains or losses on
disposition of assets and hotel properties, plus depreciation and amortization
of real estate assets, impairment charges on real estate assets, and after
adjustments for unconsolidated entities and noncontrolling interests in the
operating partnership. Adjustments for unconsolidated entities are calculated to
reflect FFO on the same basis. NAREIT developed FFO as a relative measure of
performance of an equity REIT to recognize that income-producing real estate
historically has not depreciated on the basis determined by GAAP. Our
calculation of Adjusted FFO excludes gain/loss on extinguishment of debt,
gain/loss on insurance settlements, write-off of premiums, loan costs and exit
fees, other income/expense, net transaction and conversion costs, legal,
advisory, and settlement costs, dead deal costs, uninsured remediation costs and
non-cash items such as non-cash stock/unit-based compensation, amortization of
loan costs, amortization of the term loan discount, unrealized gains/losses on
marketable securities and derivative instruments, as well as our portion of
adjustments to FFO related to unconsolidated entities. We exclude items from
Adjusted FFO that are either non-cash or are not part of our core operations in
order to provide a period-over-period comparison of our operating results. We
consider FFO and Adjusted FFO to be appropriate measures of our ongoing
normalized operating performance as a REIT. We compute FFO in accordance with
our interpretation of standards established by NAREIT, which may not be
comparable to FFO reported by other REITs that either do not define the term in
accordance with the current NAREIT definition or interpret the NAREIT definition
differently than us. FFO and Adjusted FFO do not represent cash generated from
operating activities as determined by GAAP and should not be considered as an
alternative to a) GAAP net income or loss as an indication of our financial
performance or b) GAAP cash flows from operating activities as a measure of our
liquidity, nor is it indicative of funds available to satisfy our cash needs,
including our ability to make cash distributions. However, to facilitate a clear
understanding of our historical operating results, we believe that FFO and
Adjusted FFO should be considered along with our net income or loss and cash
flows reported in the consolidated financial statements.
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The following table reconciles net income (loss) to FFO and adjusted FFO (in thousands):

Year ended the 31st of December,

                                                                                      2021                2020                2019
Net income (loss)                                                           

($271,048) $(633,222) ($142,679)
(Income) loss attributable to non-controlling interests in consolidated entities

                                                                     73                 338                 112

(Revenue) net loss attributable to redeemable non-controlling interests in the operating partnership

                                                     3,970              89,008              28,932
Preferred dividends                                                                     (252)            (32,117)            (42,577)
Gain (loss) on extinguishment of preferred stock                                        (607)             55,477                   -
Net income (loss) attributable to common stockholders                               (267,864)           (520,516)           (156,212)
Depreciation and amortization of real estate                                         218,708             252,590             268,778
(Gain) loss on disposition of assets and hotel properties                               (449)             36,680             (26,126)

Net income (loss) attributable to redeemable non-controlling interests in the operating partnership

                                                    (3,970)            (89,008)            (28,932)
Equity in (earnings) loss of unconsolidated entities                                     558                 448               2,307
Impairment charges on real estate                                                          -              91,721              33,628

Share of the company in the FFO of non-consolidated entities (Ashford Inc.)

                -                   -              (4,030)
Company's portion of FFO of unconsolidated entities (OpenKey)                           (556)               (449)               (396)
FFO available to common stockholders and OP unitholders                              (53,573)           (228,534)             89,017
(Gain) loss on extinguishment of preferred stock                                         607             (55,477)                  -
Write-off of premiums, loan costs and exit fees                                       10,612              13,867               2,841
(Gain) loss on extinguishment of debt                                                (11,896)            (90,349)                  -
(Gain) loss on insurance settlements                                                       -                (625)               (450)

Other (income) expense, net                                                           (1,760)             17,029             (10,219)
Transaction and conversion costs                                                       3,407              16,309               2,329
Legal, advisory and settlement costs                                                   7,371               1,409               1,660
Unrealized (gain) loss on marketable securities                                            -               1,467              (1,896)
Unrealized (gain) loss on derivatives                                                (14,493)            (19,950)              4,494
Dead deal costs                                                                          689                 923                  78
Uninsured remediation costs                                                              341                   -                   -
Non-cash stock/unit-based compensation                                                10,095              10,746              19,717
Amortization of term loan exit fee                                                     7,076                   -                   -
Amortization of loan costs                                                            12,597              16,517              29,537

Company’s share of FFO adjustments of non-consolidated entities (Ashford Inc.)

                                                                             -                   -               8,319

Company’s share of FFO adjustments of non-consolidated entities (OpenKey)

                                                                                 16                  17                  55
Adjusted FFO available to common stockholders and OP unitholders            

($28,911) ($316,651) $145,482

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