Braemar Hotels & Resorts Reaches Agreement With Al Shams Investments
Al Shams withdrew its notice nominating director candidates and agreed to standstill restrictions, while Braemar expects its own cost to be $4,000,000 to $6,000,000 after insurance and Ashford contributions.
Braemar Hotels & Resorts Inc. agreed to pay Al Shams Investments Limited $25,000,000 plus expenses under a settlement that resolves disputes between them, according to a Form 8-K filed with the US Securities and Exchange Commission on Oct. 8.
Braemar, Ashford Hospitality Trust, Inc. and Ashford Inc. entered into the Cooperation and Settlement Agreement with Al Shams on Oct. 6, the filing says. Wafic Rida Said is also a party, solely for certain purposes set forth in the agreement. Under its terms, Al Shams has withdrawn the notice it delivered to Braemar purporting to nominate director candidates at the company's upcoming annual meeting, and the Al Shams parties agreed to customary standstill restrictions and voting commitments.
As part of a previously announced board refresh, the Al Shams parties will be able to consult with Braemar's search firm on candidates for one additional director seat, the filing says. The board retains sole discretion over the selection.
The agreement includes mutual releases and non-disparagement provisions and resolves disputes including claims under the securities laws and claims of defamation and libel, according to the filing.
Braemar expects its total contribution to be between $4,000,000 to $6,000,000 after insurance proceeds and contributions from Ashford, the filing says. Under a separate Allocation Agreement, Braemar and Ashford will each bear 50% of the payments, net of insurance. "Braemar believes its contribution to the Settlement Agreement would likely be less than the cost of any potential litigation," the filing says.