What changed in this filing

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Item 1. Financial Statements

2025-05-08 compared with 2024-11-12 · 295 added, 538 removed, 774 unchanged (52% of the section changed)

4 unchanged sentences

(unaudited, in thousands, except share and per share amounts)

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Investments in hotel properties, gross $ 2,257,665 $ 2,252,574

3 unchanged sentences

Restricted cash 54,546 49,592

Investment in securities

Investment in securities (amortized cost of $ 42,279 and $ 42,279 , respectively)

42,394 41,535

Accounts receivable, net of allowance of $ 299 and $ 459 , respectively

20 unchanged sentences

Other liabilities 27,290 24,268

Derivative liabilities — 12

Total liabilities 1,402,332 1,413,889

Commitments and contingencies (note 15)

5.50 % Series B cumulative convertible preferred stock, $ 0.01 par value, 3,078,017 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively

5.50 % Series B cumulative convertible preferred stock, $ 0.01 par value, 3,078,017 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively

65,426 65,426

Series E redeemable preferred stock, $ 0.01 par value, 15,138,572 and 16,316,315 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively

Series E redeemable preferred stock, $ 0.01 par value, 13,909,632 and 14,910,521 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively

331,875 352,502

Series M redeemable preferred stock, $ 0.01 par value, 1,596,286 and 1,832,805 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively

Series M redeemable preferred stock, $ 0.01 par value, 1,459,040 and 1,476,621 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively

36,489 36,916

1 unchanged sentence

Preferred stock, $ 0.01 par value, 80,000,000 shares authorized:

8.25 % Series D cumulative preferred stock, 1,600,000 shares issued and outstanding at September 30, 2024 and December 31, 2023

Common stock, $ 0.01 par value, 250,000,000 shares authorized, 66,522,206 and 66,636,353 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively

8.25 % Series D cumulative preferred stock, 1,600,000 shares issued and outstanding at March 31, 2025 and December 31, 2024

Common stock, $ 0.01 par value, 250,000,000 shares authorized, 67,046,523 and 66,607,823 shares issued and outstanding at March 31, 2025 and December 31, 2024, respectively

Additional paid-in capital 720,703 718,536

10 unchanged sentences

(unaudited, in thousands, except per share amounts)

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Rooms $ 136,092 $ 138,552

13 unchanged sentences

Total operating expenses 179,080 176,612

Gain (loss) on disposition of assets and hotel property

88,210 — 88,210 —

OPERATING INCOME (LOSS) 36,740 42,467

1 unchanged sentence

Interest income 1,888 796

Other income (expense) — 293 — 293

Interest expense and amortization of discounts and loan costs ( 24,827 ) ( 26,491 )

Write-off of loan costs and exit fees ( 1,464 ) ( 721 )

Gain (loss) on extinguishment of debt — — ( 22 ) 2,318

Realized and unrealized gain (loss) on derivatives ( 198 ) 932

19 unchanged sentences

(unaudited, in thousands)

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

NET INCOME (LOSS) $ 10,672 $ 15,482

OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX:

Change in unrealized gain (loss) on investment in securities ( 786 ) — ( 786 ) —

Unrealized gain (loss) on investment in securities

Total other comprehensive income (loss) 859 —

17 unchanged sentences

Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount

Balance at June 30, 2024

1,600 $ 16 66,522 $ 665 $ 718,901 $ ( 437,302 ) $ — $ ( 9,980 ) $ 272,300 3,078 $ 65,426 16,142 $ 374,847 1,623 $ 40,569 $ 31,579

Equity-based compensation — — — — 209 — — — 209 — — — — — — 218

Issuance of preferred stock — — — — — — — — — — — 32 809 1 34 —

Dividends declared – common stock ($ 0.05 /share)

— — — — — ( 3,348 ) — — ( 3,348 ) — — — — — — —

Dividends declared – preferred stock - Series B ($ 0.34 /share)

— — — — — ( 1,059 ) — — ( 1,059 ) — — — — — — —

Dividends declared – preferred stock - Series D ($ 0.52 /share)

— — — — — ( 825 ) — — ( 825 ) — — — — — — —

Dividends declared – preferred stock - Series E ($ 0.47 /share)

— — — — — ( 7,137 ) — — ( 7,137 ) — — — — — — —

Dividends declared – preferred stock - Series M ($ 0.53 /share)

— — — — — ( 836 ) — — ( 836 ) — — — — — — —

Contributions from noncontrolling interests — — — — — — — 2,961 2,961 — — — — — — —

Distributions to noncontrolling interests — — — — — — — ( 23,322 ) ( 23,322 ) — — — — — — ( 369 )

Net income (loss) — — — — — 12,596 — 27,363 39,959 — — — — — — ( 124 )

Unrealized gain (loss) on investment in securities

— — — — — — ( 723 ) — ( 723 ) — — — — — — ( 63 )

Redemption of preferred stock — — — — — — — — — — — ( 1,036 ) ( 24,629 ) ( 28 ) ( 696 ) —

Redemption value adjustment – preferred stock — — — — — ( 4,151 ) — — ( 4,151 ) — — — 4,151 — — —

Redemption value adjustment — — — — — ( 95 ) — — ( 95 ) — — — — — — 95

Balance at September 30, 2024

1,600 $ 16 66,522 $ 665 $ 719,110 $ ( 442,157 ) $ ( 723 ) $ ( 2,978 ) $ 273,933 3,078 $ 65,426 15,138 $ 355,178 1,596 $ 39,907 $ 31,336

8.25 % Series D Cumulative Preferred Stock

Common Stock Additional

Capital Accumulated Deficit Accumulated Other Comprehensive Income/(loss)

Noncontrolling Interest in Consolidated Entities Total 5.50 % Series B Cumulative Convertible

Preferred Stock

Series E Redeemable

Preferred Stock Series M Redeemable

Preferred Stock Redeemable Noncontrolling Interests in Operating Partnership

Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount

Balance at December 31, 2024

1,600 $ 16 66,608 $ 665 $ 718,536 $ ( 477,804 ) $ ( 684 ) $ ( 3,367 ) $ 237,362 3,078 $ 65,426 14,911 $ 352,502 1,477 $ 36,916 $ 29,964

Purchase of common stock — — ( 19 ) — ( 51 ) — — — ( 51 ) — — — — — — —

2 unchanged sentences

Issuance of restricted shares/units — — 1 — 4 — — — 4 — — — — — — 498

Forfeiture of restricted common shares — — ( 1 ) — — — — — — — — — — — — —

Dividends declared – common stock ($ 0.05 /share)

8 unchanged sentences

— — — — — ( 770 ) — — ( 770 ) — — — — — — —

Contributions from noncontrolling interests — — — — — — — 2,961 2,961 — — — — — — —

Distributions to noncontrolling interests — — — — — — — — — — — — — — — ( 344 )

Net income (loss) — — — — — 16,960 — 26,317 43,277 — — — — — — ( 1,747 )

Redemption of preferred stock — — — — — — — — — — — ( 1,275 ) ( 30,281 ) ( 241 ) ( 6,018 ) —

Unrealized gain (loss) on investment in securities — — — — — — ( 723 ) — ( 723 ) — — — — — — ( 63 )

Redemption value adjustment – preferred stock — — — — — ( 6,175 ) — — ( 6,175 ) — — — 5,978 — 197 —

Redemption value adjustment — — — — — ( 110 ) — — ( 110 ) — — — — — — 110

Balance at September 30, 2024

1,600 $ 16 66,522 $ 665 $ 719,110 $ ( 442,157 ) $ ( 723 ) $ ( 2,978 ) $ 273,933 3,078 $ 65,426 15,138 $ 355,178 1,596 $ 39,907 $ 31,336

8.25 % Series D Cumulative Preferred Stock

Common Stock Additional

Capital Accumulated Deficit Noncontrolling Interest in Consolidated Entities Total 5.50 % Series B Cumulative Convertible

Preferred Stock

Series E Redeemable

Preferred Stock Series M Redeemable

Preferred Stock Redeemable Noncontrolling Interests in Operating Partnership

Shares Amount Shares Amount Shares Amount Shares Amount Shares Amount

Balance at June 30, 2023

1,600 $ 16 65,994 $ 659 $ 716,987 $ ( 341,210 ) $ ( 12,669 ) $ 363,783 3,078 $ 65,426 16,485 $ 379,403 1,960 $ 48,405 $ 35,174

Purchase of common stock — — — — — — — — — — — — — — —

Equity-based compensation — — — — 577 — — 577 — — — — — — 1,050

Issuance of preferred stock — — — — — — — — — — 36 813 3 56 —

Dividends declared – common stock ($ 0.05 /share)

— — — — — ( 3,335 ) — ( 3,335 ) — — — — — — —

Dividends declared – preferred stock - Series B ($ 0.34 /share)

— — — — — ( 1,058 ) — ( 1,058 ) — — — — — — —

Dividends declared – preferred stock-Series D ($ 0.52 /share)

— — — — — ( 825 ) — ( 825 ) — — — — — — —

Dividends declared – preferred stock - Series E ($ 0.47 /share)

— — — — — ( 7,710 ) — ( 7,710 ) — — — — — — —

Dividends declared – preferred stock - Series M ($ 0.52 /share)

Redemption/conversion of operating partnership units — — 457 4 2,247 — — — 2,251 — — — — — — ( 2,251 )

Redemption of operating partnership units for cash

— — — — — — — — — — — — — — — ( 92 )

Distributions to noncontrolling interests — — — — — — ( 2,740 ) ( 2,740 ) — — — — — — ( 361 )

Net income (loss) — — — — — 10,998 — ( 64 ) 10,934 — — — — — — ( 262 )

Redemption of preferred stock — — — — — — — — — — — ( 1,033 ) ( 25,701 ) ( 19 ) ( 466 ) —

Unrealized gain (loss) on investment in securities — — — — — — 779 — 779 — — — — — — 80

Redemption value adjustment – preferred stock — — — — — ( 4,276 ) — — ( 4,276 ) — — — 4,276 — — —

Redemption value adjustment — — — — — 1,148 — — 1,148 — — — — — — ( 1,148 )

Balance at September 30, 2023

Balance at March 31, 2025

1,600 $ 16 67,047 $ 669 $ 720,703 $ ( 482,575 ) $ 95 $ ( 3,431 ) $ 235,477 3,078 $ 65,426 13,910 $ 331,875 1,459 $ 36,489 $ 26,430

21 unchanged sentences

— — — — — ( 924 ) — ( 924 ) — — — — — — —

Contributions from noncontrolling interests — — — — — — 4,050 4,050 — — — — — — —

Distributions to noncontrolling interests — — — — — — — — — — — — — — ( 366 )

Redemption/conversion of operating partnership units — — — — — — — — — — — — — — ( 7,162 )

Net income (loss) — — — — — 15,929 ( 743 ) 15,186 — — — — — — 296

2 unchanged sentences

Redemption value adjustment — — — — — 7 — 7 — — — — — — ( 7 )

Balance at September 30, 2023

Balance at March 31, 2024

1,600 $ 16 66,477 $ 664 718,606 $ ( 412,013 ) $ ( 9,677 ) $ 297,596 3,078 $ 65,426 16,163 $ 375,261 1,748 $ 43,694 $ 33,005

4 unchanged sentences

(unaudited, in thousands)

Nine Months Ended September 30,

Three Months Ended March 31,

CASH FLOWS FROM OPERATING ACTIVITIES

2 unchanged sentences

Depreciation and amortization 23,395 25,420

Recognition of deferred income ( 174 ) —

Equity-based compensation ( 48 ) 1,127

Bad debt expense ( 15 ) 248

(Gain) loss on extinguishment of debt 22 ( 2,318 )

Amortization of loan costs, discounts and capitalized default interest 2,293 1,404

3 unchanged sentences

Interest expense accretion on refundable membership club deposits 151 165

(Gain) loss on disposition of assets and hotel property

Realized and unrealized (gain) loss on derivatives 198 ( 932 )

2 unchanged sentences

Deferred income tax expense (benefit) ( 13 ) 5

Changes in operating assets and liabilities, exclusive of disposition of assets and hotel property:

Changes in operating assets and liabilities, exclusive of acquisitions, disposition of assets and hotel property:

Accounts receivable and inventories ( 9,285 ) ( 2,194 )

11 unchanged sentences

Proceeds from property insurance 1,101 504

Issuance of note receivable

Payments for initial franchise fee — ( 75 )

Net proceeds from sale of hotel property

Purchase of securities

Investment in unconsolidated entity ( 79 ) ( 237 )

Improvements and additions to hotel properties ( 15,305 ) ( 23,332 )

6 unchanged sentences

Proceeds from derivatives 244 1,633

Purchase of common stock ( 369 ) ( 19,308 )

Payments for dividends and distributions ( 12,209 ) ( 13,123 )

Net proceeds from issuance of preferred stock — 97,863

Contributions from noncontrolling interest in consolidated entities 2,961 4,050

Redemption of operating partnership units ( 92 ) —

Distributions to noncontrolling interest in consolidated entities ( 27,045 ) ( 2,024 )

Nine Months Ended September 30,

Redemption of preferred stock ( 26,167 ) ( 6,566 )

5 unchanged sentences

$ 136,235 $ 219,423

Three Months Ended March 31,

SUPPLEMENTAL CASH FLOW INFORMATION

3 unchanged sentences

Dividends and distributions declared but not paid $ 8,692 $ 9,253

Common stock purchases accrued but not paid 51 369

Capital expenditures accrued but not paid 8,825 15,810

2 unchanged sentences

Non-cash common stock/unit dividends

Non-cash redemption of common units

SUPPLEMENTAL DISCLOSURE OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH

25 unchanged sentences

instead, we contractually engage hotel management companies to operate them for us under management contracts.

Remington Lodging & Hospitality, LLC (“Remington Hospitality”), a subsidiary of Ashford Inc., manages four of our 15 hotel properties.

Remington Lodging & Hospitality, LLC (“Remington Hospitality”), a subsidiary of Ashford Inc., manages four of our 15 hotel properties as of March 31, 2025.

Third-party management companies manage the remaining hotel properties.

1 unchanged sentence

has an ownership interest.

These products and services include, but are not limited to, design and construction services, debt placement and related services, broker-dealer and distribution services, audio visual services, real estate advisory and brokerage services, insurance policies covering general liability, workers compensation and business automobile claims, insurance claims services, hypoallergenic premium rooms, watersport activities, travel/transportation services, mobile key technology and cash management services.

The accompanying condensed consolidated financial statements include the accounts of wholly-owned and majority-owned subsidiaries of Braemar OP that as of September 30, 2024, own 15 hotel properties in seven states, the District of Columbia, Puerto Rico and the U.S.

The accompanying condensed consolidated financial statements include the accounts of wholly-owned and majority-owned subsidiaries of Braemar OP that as of March 31, 2025, own 15 hotel properties in seven states, the District of Columbia, Puerto Rico and the U.S.

Virgin Islands (“USVI”).

2 unchanged sentences

As a REIT, Braemar is required to comply with limitations imposed by the Code related to operating hotels.

As of September 30, 2024, 14 of our 15 hotel properties were leased by wholly-owned or majority-owned subsidiaries that are treated as taxable REIT subsidiaries (“TRS”) for federal income tax purposes (collectively, the TRS entities are referred to as “Braemar TRS”).

As of March 31, 2025, 14 of our 15 hotel properties were leased by wholly-owned or majority-owned subsidiaries that are treated as taxable REIT subsidiaries (“TRS”) for federal income tax purposes (collectively, the TRS entities are referred to as “Braemar TRS”).

One hotel property, located in the USVI, is owned by our USVI TRS.

1 unchanged sentence

Hotel operating results related to the hotel properties are included in the condensed consolidated statements of operations.

As of September 30, 2024, 13 of the 15 hotel properties were leased by Braemar’s wholly-owned TRS, and the one hotel property majority-owned through a consolidated partnership was leased to a TRS wholly-owned by such consolidated partnership.

As of March 31, 2025, 13 of the 15 hotel properties were leased by Braemar’s wholly-owned TRS and the one hotel property majority-owned through a consolidated partnership was leased to a TRS wholly-owned by such consolidated partnership.

Each leased hotel is leased under a percentage lease that provides for each lessee to pay in each calendar month the base rent plus, in each calendar quarter, percentage rent, if any, based on hotel revenues.

Lease revenue from Braemar TRS is eliminated in consolidation.

Lease revenue from Braemar TRS is eliminated in consolidation as of March 31, 2025.

The hotel properties are operated under management contracts with Marriott Hotel Services, LLC (“Marriott”), Hilton Management LLC (“Hilton”), Accor Management US Inc.

15 unchanged sentences

Braemar OP is considered to be a variable interest entity (“VIE”), as defined by authoritative accounting guidance.

A VIE must be consolidated by a reporting entity if the reporting entity is the primary beneficiary because it has (i) the power to direct the VIE’s activities that most significantly impact the VIE’s economic performance and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE.

A VIE must be consolidated by a reporting entity if the reporting entity is the primary beneficiary because it has:

(i) the power to direct the VIE’s activities that most significantly impact the VIE’s economic performance;

and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE.

All major decisions related to Braemar OP that most significantly impact its economic performance, including but not limited to, operating procedures with respect to business affairs and any acquisitions, dispositions, financings, restructurings or other transactions with sellers, purchasers, lenders, brokers, agents and other applicable representatives, are subject to the approval of our wholly-owned subsidiary, Braemar OP General Partner LLC, its general partner.

2 unchanged sentences

• Historical seasonality patterns at some of our hotel properties cause fluctuations in our overall operating results.

Consequently, operating results for the three and nine months ended September 30, 2024, are not necessarily indicative of the results that may be expected for the year ending December 31, 2024.

Consequently, operating results for the three months ended March 31, 2025, are not necessarily indicative of the results that may be expected for the year ending December 31, 2025.

• On July 17, 2024, we sold the Hilton La Jolla Torrey Pines.

2 unchanged sentences

Actual results could differ from those estimates.

Investment in Securities — Investment in securities consists of mortgage-backed securities, are accounted for as available-for-sale securities and are generally reported at fair value utilizing Level 2 inputs where the Company obtains fair value measurements from an independent pricing service that uses matrix pricing, which is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted securities (Level 2 inputs).

The fair value measurements consider observable data that may include dealer quotes, market spreads, cash flows and the bonds’ terms and conditions, among other things.

Unrealized gain (loss) associated with these investments is reported as a component of other comprehensive income (loss).

Recently Issued Accounting Standards —In November 2023, the Financial Accounting Standards Board’s (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting (Topic 280):Improvements to Reportable Segment Disclosures, which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses.

ASU 2023-07 is effective for our annual periods beginning January 1, 2024, and for interim periods beginning January 1, 2025, with early adoption permitted.

As of September 30, 2024, the Company has not adopted this ASU.

The adoption of this ASU is expected to only impact disclosures with respect to the Company’s consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

Recently Issued Accounting Standards —In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures , to expand the disclosure requirements for income taxes, specifically related to the rate reconciliation and income taxes paid.

1 unchanged sentence

The amendments in this ASU may be applied prospectively by providing the revised disclosures for the period ending December 31, 2025 and continuing to provide the pre-ASU disclosures for the prior periods, or the amendments may be applied retrospectively by providing the revised disclosures for all periods presented.

As of September 30, 2024, the Company has not adopted this ASU.

As of March 31, 2025, the Company has not adopted this ASU.

The adoption of this ASU is expected to only impact disclosures with respect to the Company’s consolidated financial statements.

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

information about specified categories of expenses (purchases of inventory, employee compensation, depreciation, amortization, and depletion) included in certain expense captions presented on the face of the statement of operations.

This ASU is effective for fiscal years beginning after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027.

Early adoption is permitted.

The amendments may be applied either (1) prospectively to financial statements issued for reporting periods after the effective date of this ASU or (2) retrospectively to all prior periods presented in the financial statements.

In November 2024, the FASB issued ASU 2024-03 , Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40) Disaggregation of Income Statement Expenses that requires more detailed information about specified categories of expenses (purchases of inventory, employee compensation, depreciation, amortization, and depletion) included in certain expense captions presented on the face of the statement of operations.

In January 2025, the FASB issued ASU 2025-01 which amends the effective date of the new disaggregation of income statement expenses standard to clarify that all public business entities are required to adopt the guidance in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027.

Early adoption is still permitted.

The amendments may be applied either:

(1) prospectively to financial statements issued for reporting periods after the effective date of this ASU:

or (2) retrospectively to all prior periods presented in the financial statements.

We are currently evaluating the impact this ASU will have on our disclosures.

The following tables present our revenue disaggregated by geographical areas (dollars in thousands):

Three Months Ended September 30, 2024

Primary Geographical Market Number of Hotels Rooms Food and Beverage Other Hotel Total

California 5 $ 23,366 $ 7,041 $ 4,138 $ 34,545

Puerto Rico 1 6,764 3,303 2,157 12,224

Arizona 1 3,472 2,625 1,820 7,917

Colorado 1 3,591 3,876 2,147 9,614

Florida 2 9,844 4,822 5,586 20,252

Illinois 1 9,037 1,972 662 11,671

Pennsylvania 1 7,334 1,539 378 9,251

Washington 1 11,224 1,598 1,061 13,883

Washington, D.C.

1 9,712 3,595 949 14,256

USVI 1 6,709 4,071 1,956 12,736

Sold hotel property

1 1,374 339 336 2,049

Total 16 $ 92,427 $ 34,781 $ 21,190 $ 148,398

Three Months Ended September 30, 2023

Primary Geographical Market Number of Hotels Rooms Food and Beverage Other Hotel Total

California 5 $ 25,363 $ 7,771 $ 3,910 $ 37,044

Puerto Rico 1 9,463 3,836 1,437 14,736

Arizona 1 3,541 2,990 1,692 8,223

Colorado 1 3,466 3,876 2,213 9,555

Florida 2 10,348 5,226 4,441 20,015

Illinois 1 7,735 1,767 633 10,135

Pennsylvania 1 6,373 1,237 326 7,936

Washington 1 10,454 1,336 473 12,263

Washington, D.C.

1 8,264 3,754 517 12,535

USVI 1 7,283 3,224 3,164 13,671

Sold hotel property

1 8,448 3,520 1,720 13,688

Total 16 $ 100,738 $ 38,537 $ 20,526 $ 159,801

BRAEMAR HOTELS & RESORTS INC.

1 unchanged sentence

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Nine Months Ended September 30, 2024

The following tables present our revenue disaggregated by geographical areas (dollars in thousands):

Three Months Ended March 31, 2025

Primary Geographical Market Number of Hotels Rooms Food and Beverage Other Hotel Total

10 unchanged sentences

USVI 1 16,348 5,056 2,972 24,376

Sold hotel property

1 15,501 9,207 3,193 27,901

Total 15 $ 136,092 $ 51,788 $ 27,940 $ 215,820

Nine Months Ended September 30, 2023

Three Months Ended March 31, 2024

Primary Geographical Market Number of Hotels Rooms Food and Beverage Other Hotel Total

15 unchanged sentences

Investments in hotel properties, net consisted of the following (in thousands):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Land $ 630,842 $ 630,842

7 unchanged sentences

Impairment Charges

During the nine months ended September 30, 2024 and 2023, no impairment charges were recorded.

During the three months ended March 31, 2025 and 2024, no impairment charges were recorded.

Hotel Disposition

1 unchanged sentence

The Company owned an indirect 75 % equity interest in the hotel property.

Additionally, the Company repaid the $ 66.6 million mortgage loan secured by the hotel property.

Additionally, the Company

BRAEMAR HOTELS & RESORTS INC.

1 unchanged sentence

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The sale resulted in a gain of approximately $ 88.2 million for the three and nine months ended September 30, 2024 and is included in “gain (loss) on disposition of assets and hotel property” in our condensed consolidated statements of operations.

Since the sale of the hotel property did not represent a strategic shift that has (or will have) a major effect on our operations or financial results, its results of operations were not reported as discontinued operations in our condensed consolidated financial statements.

We included the results of operations for this hotel property through the date of disposition in net income (loss) as shown in our condensed consolidated statements of operations for the three and nine months ended September 30, 2024 and 2023 , respectively .

repaid the $ 66.6 million mortgage loan secured by the hotel property.

The sale resulted in a gain of approximately $ 88.1 million for the year ended December 31, 2024.

The following table includes the condensed consolidated financial information from this hotel property (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31, 2024

Total hotel revenue $ 11,740

2 unchanged sentences

Depreciation and amortization ( 1,090 )

Gain (loss) on disposition of assets and hotel property

88,160 — 88,160 —

Operating income (loss) 2,668

6 unchanged sentences

Income (loss) before income taxes attributable to the Company $ 247

Investment in Unconsolidated Entity

OpenKey, Inc.

(“OpenKey”), which is controlled and consolidated by Ashford Inc., is a hospitality-focused mobile key platform that provides a universal smart phone app and related hardware and software for keyless entry into hotel guest rooms.

As of September 30, 2024, the Company has made equity investments in OpenKey totaling $ 2.9 million.

All investments were recommended by our Related Party Transactions Committee and unanimously approved by the independent members of our board of directors.

Our investment is recorded as “investment in unconsolidated entity” in our condensed consolidated balance sheets and is accounted for under the equity method of accounting as we have significant influence over the entity under the applicable accounting guidance.

We review our investment in OpenKey for impairment in each reporting period pursuant to the applicable authoritative accounting guidance.

An investment is impaired when its estimated fair value is less than the carrying amount of the investment.

Any impairment is recorded in equity in earnings (loss) of unconsolidated entity.

No such impairment was recorded for the three and nine months ended September 30, 2024 and 2023.

The following table summarizes our carrying value and ownership interest in OpenKey:

September 30, 2024 December 31, 2023

Carrying value of the investment in OpenKey (in thousands) $ 1,173 $ 1,416

Ownership interest in OpenKey 7.9 % 7.9 %

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table summarizes our equity in earnings (loss) in OpenKey (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

Line Item 2024 2023 2024 2023

Equity in earnings (loss) of unconsolidated entity $ ( 91 ) $ ( 65 ) $ ( 243 ) $ ( 219 )

On February 2, 2023, the Company entered into a loan funding agreement with Ashford Inc.

Per the agreement, Ashford Inc.

and the Company will provide OpenKey with a maximum loan amount of $ 5.0 million to be allocated on a pro-rata basis based on current ownership interests and funded quarterly.

The loan bears interest at an annual rate of 15 %.

Additionally, repayment of the loan principal and all accrued interest is due upon certain events.

On February 27, 2024, the Company approved additional funding, together with Ashford Inc., up to $ 1.0 million in aggregate to OpenKey, allocated pro rata among them.

As of September 30, 2024, funding of $ 79,000 has been made pursuant to the 2024 funding agreement.

As of September 30, 2024, the Company has funded a total amount of approximately $ 317,000 .

The following table summarizes our note receivable from OpenKey (in thousands):

Line Item September 30, 2024 December 31, 2023

Investment in unconsolidated entity $ 366 $ 258

The following table summarizes the interest income associated with the loan to OpenKey (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

Line Item 2024 2023 2024 2023

Equity in earnings (loss) of unconsolidated entity $ 11 $ 5 $ 29 $ 11

Indebtedness, net

Indebtedness, net consisted of the following (dollars in thousands):

Current Maturity

Maturity (15)

Interest Rate

September 30, 2024 December 31, 2023

Mortgage loan (3)

Cameo Beverly Hills August 2024 August 2024 SOFR (1) + 3.66 %

Mortgage loan (4)

Hilton La Jolla Torrey Pines August 2024

August 2024 9.00 % — 66,600

Mortgage loan (5)

The Ritz-Carlton Lake Tahoe January 2025

January 2026 SOFR (1) + 3.60 %

53,413 53,413

Mortgage loan (6)

Park Hyatt Beaver Creek Resort & Spa February 2025

February 2027 SOFR (1) + 2.86 %

70,500 70,500

Indebtedness Collateral Current Maturity Final

Interest Rate March 31, 2025 December 31, 2024

Mortgage loan (2) (3)

The Notary Hotel June 2025

June 2025 SOFR (1) + 2.66 %

The Notary Hotel June 2025 June 2025 SOFR (1) + 2.66 %

$ — $ 293,180

2 unchanged sentences

Mortgage loan (4)

The Ritz-Carlton St.

Thomas August 2025

August 2026 SOFR (1) + 4.35 %

The Ritz-Carlton Lake Tahoe July 2025 January 2026 SOFR (1) + 3.25 %

43,413 53,413

Mortgage loan (5)

Pier House Resort & Spa September 2025

September 2026 SOFR (1) + 3.60 %

Park Hyatt Beaver Creek Resort & Spa February 2026 February 2027 SOFR (1) + 2.86 %

70,500 70,500

Mortgage loan (3)

The Ritz-Carlton Reserve Dorado Beach

March 2026 March 2026 SOFR (1) + 4.75 %

The Ritz-Carlton Reserve Dorado Beach March 2026 March 2026 SOFR (1) + 4.75 %

Convertible Senior Notes Equity June 2026 June 2026 4.50 % 86,250 86,250

BAML Credit Facility (9)(12)

Bardessono Hotel & Spa

July 2026 July 2027 Base Rate (2) + 1.25 % to 2.00 % or

SOFR (1) + 2.35 % to 3.10 %

Hotel Yountville

The Ritz-Carlton Sarasota

Mortgage loan (6)

Bardessono Hotel & Spa

August 2026 August 2029 SOFR (1) + 3.24 %

Bardessono Hotel & Spa August 2026 August 2029 SOFR (1) + 3.24 %

407,000 407,000

Hotel Yountville

8 unchanged sentences

110,600 110,600

Mortgage loan (3)

The Notary Hotel March 2027 March 2030 SOFR (1) + 2.52 %

Sofitel Chicago Magnificent Mile

Marriott Seattle Waterfront

The Ritz-Carlton Reserve Dorado Beach

1,220,763 1,222,943

Capitalized default interest and late charges, net

Deferred loan costs, net ( 17,316 ) ( 11,985 )

2 unchanged sentences

__________________

(1) SOFR rates were 4.85 % and 5.35 % at September 30, 2024 and December 31, 2023, respectively.

(1) SOFR rates were 4.32 % and 4.33 % at March 31, 2025 and December 31, 2024, respectively.

(2) This mortgage loan had five one-year extension options, subject to satisfaction of certain conditions, of which the fifth was exercised in June 2024.

(3) On March 7, 2025, we refinanced two mortgage loans into a new $ 363.0 million mortgage loan.

The new mortgage loan is interest only and bears interest at a rate of SOFR + 2.52 %, has a two-year initial term, and has three one-year extension options, subject to the satisfaction of certain conditions.

BRAEMAR HOTELS & RESORTS INC.

1 unchanged sentence

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

(2) Base Rate, as defined in the secured credit facility agreement, is the greater of (i) the prime rate set by Bank of America, (ii) federal funds rate + 0.50 %, (iii) Term SOFR + 1.00 %, or (iv) 1.00 %.

(3) This mortgage loan had a SOFR floor of 1.50 %.

On April 9, 2024, we repaid this mortgage loan.

(4) On February 5, 2024, we amended this mortgage loan.

Terms of the amendment included extending the maturity date by six months from February 2024 to August 2024, and converting the interest rate from a variable rate of SOFR + 1.70 % to a fixed rate of 9.00 %.

This mortgage loan was secured by the Hilton La Jolla Torrey Pines.

On July 17, 2024, we sold this property for $ 165.0 million and repaid the mortgage loan.

(5) This mortgage loan has one one-year extension option, subject to satisfaction of certain conditions.

(6) This mortgage loan has three one-year extension options, subject to satisfaction of certain conditions, of which the first was exercised February 2024.

(7) This mortgage loan has five one-year extension options, subject to satisfaction of certain conditions, of which the fifth was exercised in June 2024.

(4) On January 14, 2025, we amended this mortgage loan.

Terms of the amendment included extending the current maturity date one year to August 2025, and the variable rate increased from SOFR + 4.04 % to SOFR 4.35 %.

This amended mortgage loan has one one-year extension option, subject to satisfaction of certain conditions.

This mortgage loan has a SOFR floor of 4.00 %.

(9) On August 7, 2024, we refinanced this mortgage loan and credit facility into a new $ 407.0 million mortgage loan.

The new mortgage loan is interest only and bears interest at a rate of SOFR + 3.24 %, has a two-year initial term, and has three one-year extension options, subject to satisfaction of certain conditions.

Braemar holds a tranche of Commercial Mortgage-Backed Securities (“CMBS”) that has a par value of $ 42.2 million and a rate of SOFR + 5.20 %.

(10) On January 3, 2024, we amended this mortgage loan.

Terms of the amendment included extending the current maturity date one year to September 2025, and the variable rate increased from SOFR + 1.95 % to SOFR + 3.60 %.

This mortgage loan has one one-year extension option, subject to satisfaction of certain conditions.

(11) On March 7, 2024, we entered into a new $ 62.0 million mortgage loan.

The new mortgage loan is interest only and bears interest at a rate of SOFR + 4.75 %.

(12) This secured credit facility has one one-year extension option, subject to satisfaction of certain conditions.

Terms of the amendment included a $ 10.0 million principal pay-down, current maturity date extension to July 2025, interest rate reduction to SOFR + 3.25 %, and one six-month extension option subject to satisfaction of certain conditions.

(5) This mortgage loan has three one-year extension options, subject to satisfaction of certain conditions, of which the second was exercised in February 2025.

(6) This mortgage loan has three one-year extension options, subject to satisfaction of certain conditions.

Braemar holds a tranche of Commercial Mortgage-Backed Securities (“CMBS”), which is secured by the five hotel properties that serve as collateral for the new mortgage loan and has a par value of $ 42.2 million and a rate of SOFR + 5.20 %.

The CMBS is reported as “investment in securities” on the condensed consolidated balance sheet.

(7) This mortgage loan has two one-year extension options, subject to satisfaction of certain conditions.

3 unchanged sentences

(9) The final maturity date assumes all available extension options will be exercised.

On January 18, 2023, the Company repaid its $ 54.0 million mortgage loan secured by The Ritz-Carlton Reserve Dorado Beach, which resulted in a gain on extinguishment of debt of $ 2.3 million for the year ended December 31, 2023.

The gain was primarily attributable to the premium that was recorded upon the assumption of the mortgage loan when the hotel was acquired.

On July 17, 2024, the Company sold the Hilton La Jolla Torrey Pines for $ 165 million in cash, subject to customary pro-rations and adjustments.

Additionally, the Company repaid the $ 66.6 million mortgage loan secured by the hotel property.

On August 7, 2024, the Company closed on a refinancing involving five hotels.

The new mortgage loan totals $ 407 million and has a two-year initial term with three one-year extension options, subject to the satisfaction of certain conditions, taking the final maturity to 2029.

The loan is interest only and provides for a floating interest rate of SOFR + 3.24 %.

The loan is secured by five hotels:

Pier House Resort & Spa, Bardessono Hotel & Spa, Hotel Yountville, The Ritz-Carlton Sarasota, and The Ritz-Carlton St.

The new loan refinanced the $ 80.0 million loan secured by the Pier House Resort & Spa which had an interest rate of SOFR + 3.60 % and had a final maturity date in September 2026, the $ 42.5 million loan secured by The Ritz-Carlton St.

Thomas which had an interest rate of SOFR + 4.35 % and had a final maturity date in August 2026, and the $ 200.0 million secured credit facility secured by The Ritz-Carlton Sarasota, Hotel Yountville, and Bardessono Hotel & Spa which had an interest rate of SOFR + 3.10 % and had a final maturity date in July 2027.

Convertible Senior Notes

In May 2021, the Company issued $ 86.25 million aggregate principal amount of 4.50 % Convertible Senior Notes due June 2026 (the “Convertible Senior Notes”).

The net proceeds from this offering of the Convertible Senior Notes were approximately $ 82.8 million after deducting the underwriting fees and other expenses paid by the Company.

The Convertible Senior Notes are governed by an indenture between the Company and U.S.

Bank National Association, as trustee.

The Convertible Senior Notes bear interest at a rate of 4.50 % per annum, payable semi-annually in arrears on June 1 and December 1 of each year, beginning on December 1, 2021.

The Convertible Senior Notes will mature on June 1, 2026.

For the three and nine months ended September 30, 2024, the Company recorded coupon interest expense of $ 970,000 and $ 2.9 million, respectively.

For the three and nine months ended September 30, 2023, the Company recorded coupon interest expense of $ 970,000 and $ 2.9 million, respectively.

For the three and nine months ended September 30, 2024, the Company recorded discount amortization of $ 157,000 and $ 463,000 , respectively, related to the initial purchase discount, with the remaining discount balance to be amortized through

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

For the three and nine months ended September 30, 2023, the Company recorded discount amortization of $ 148,000 and $ 438,000 , respectively.

The Convertible Senior Notes are convertible at any time prior to the close of business on the business day immediately preceding the maturity date for cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the election of the Company, based on an initial conversion rate of 157.7909 shares of the Company’s common stock per $1,000 principal amount of notes (equivalent to a conversion price of approximately $ 6.34 per share of common stock), subject to adjustment of the conversion rate under certain circumstances.

As of September 30, 2024, the conversion rate is 182.1014.

In addition, following the occurrence of certain corporate events, if the Company provides notice of redemption or if it exercises its option to convert the Convertible Senior Notes, the Company will, in certain circumstances, increase the conversion rate for a holder that converts its Convertible Senior Notes in connection with such corporate event, such notice of redemption, or such issuer conversion option, as the case may be.

The Company may redeem the Convertible Senior Notes at the Company’s option, in whole or in part, on any business day on or after the date of issuance if the last reported sale price per share of the Company’s common stock has been at least 130 % of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which the Company provides a notice of redemption at a redemption price equal to 100 % of the principal amount of the Convertible Senior Notes to be redeemed subject to certain adjustments, plus accrued and unpaid interest to, but excluding, the redemption date.

For the three months ended March 31, 2025 and 2024, the Company recorded coupon interest expense of $ 970,000 and $ 970,000 , respectively.

For the three months ended March 31, 2025 and 2024, the Company recorded discount amortization of $ 161,000 and $ 152,000 , respectively, related to the initial purchase discount, with the remaining discount balance to be amortized through June 2026.

The convertible senior notes are convertible at any time prior to the close of business on the business day immediately preceding the maturity date for cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the election of the Company.

As of March 31, 2025, the conversion rate is 188.0528 shares per $1,000 principal amount of notes.

If we violate covenants in any debt 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 the consolidated group.

As of September 30, 2024, we were in compliance with all covenants.

As of March 31, 2025, we were in compliance with all covenants.

Interest Rate Derivatives —We use interest rate caps to hedge our debt and our cash flows, which are recorded at fair value.

Payments from counterparties on in-the-money interest rate caps are recognized as realized gains on our condensed consolidated statements of operations.

Note Receivable

On July 2, 2024, Braemar, Ashford Trust and Ashford Inc.

On July 2, 2024, Braemar, Ashford Hospitality Trust, Inc.

(“Ashford Trust”) and Ashford Inc.

(collectively with the Company, Ashford Trust and each of Ashford Inc.’s, the Company’s and Ashford Trust’s respective affiliates (including Stirling Hotels & Resorts, Inc.) and any entity advised by Ashford Inc., the “Company Group”) entered into a Cooperation Agreement (the “Agreement”) with Blackwells Capital LLC, Blackwells Onshore I LLC, Blackwells Holding Co.

LLC, Vandewater Capital Holdings, LLC, Blackwells Asset Management LLC, BW Coinvest Management I LLC and Jason Aintabi (collectively, the “Blackwells Parties”) regarding the withdrawal of the Blackwells Parties’ proxy campaign, dismissal of pending litigation involving the parties and certain other matters.

Pursuant to the Agreement, the Blackwells Parties have agreed to withdraw (i) the notice delivered to the Company on March 10, 2024 purporting to nominate four director candidates to the Company’s board of directors (the “Board”) and make certain other proposals and (ii) the definitive proxy statement filed with the SEC on April 3, 2024 to solicit proxies from stockholders of the Company to vote in favor of the Blackwells Parties’ director nominees and proposals.

In connection therewith, the Blackwells Parties will cease to take any further action with respect to the Company’s 2024 Annual Meeting of Stockholders, except as otherwise provided for in the Agreement.

The Blackwells Parties have also agreed to specified standstill restrictions with respect to the Company Group, which will expire on July 2, 2034.

During the standstill period, the Blackwells Parties are required to (i) appear in person or by proxy at each meeting of stockholders of the members of the Company Group in which they beneficially own shares of stock and vote any Blackwells Parties’ shares then beneficially owned by them in accordance with the recommendation of the board of directors of such member of the Company Group on any proposals considered at such meeting and (ii) deliver consents or consent revocations in any action by written consent by stockholders of any member of the Company Group in which they beneficially own shares in accordance with the recommendation of the board of directors of such member of the Company Group.

The Agreement also provides for the voluntary dismissal, with prejudice, of the consolidated action previously pending in the U.S.

District Court for the Northern District of Texas to which the Company, Blackwells Capital LLC and certain of their respective related parties were parties (the “Consolidated Litigation”).

Pursuant to the Agreement, the Consolidated Litigation was voluntarily dismissed, with prejudice, on July 3, 2024.

The Company has agreed to reimburse Blackwells Capital LLC, in an amount agreed upon by the parties, for the Blackwells Parties’ reasonable attorneys’ fees and expenses incurred in connection with the Consolidated Litigation and related matters.

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Additionally, pursuant to the Agreement, the Board was required to take steps to identify and select one additional individual to be appointed to the Board as an independent director (the “Additional Board Member”).

The Board was required to promptly notify Blackwells Capital LLC of its selection of the Additional Board Member and to consider any input Blackwells Capital LLC may have with respect to the Additional Board Member.

In accordance with the Cooperation Agreement, on October 4, 2024, the Board increased the number of directors of the Company from eight to nine and appointed Mr.

Shah as the Additional Board Member to serve until the Company’s next annual meeting of stockholders and until his successor is duly elected and qualified.

The Agreement contains various other obligations and provisions applicable to the Company Group and the Blackwells Parties, including a mutual release of claims and mutual non-disparagement.

Concurrently and in connection with the Agreement, certain of the parties thereto have also entered into a Share Ownership Agreement (the “Share Ownership Agreement”) and a Loan Agreement (the “Loan Agreement”), pursuant to which agreements the Company will provide to BW Coinvest I, LLC (“Borrower”) an unsecured loan (the “Loan”).

1 unchanged sentence

The Loan has a term of five years (the “Term”), is guaranteed by Jason Aintabi, Vandewater Capital Holdings, LLC, Blackwells Holding Co.

LLC, and Blackwells Asset Management LLC and shall bear payment-in-kind interest during the Term at a rate equal to the sum of (a) Term SOFR (as defined in the Loan Agreement) and (b) 3.00 % (three hundred basis points) per annum.

LLC, and Blackwells Asset Management LLC and shall bear payment-in-kind interest during the Term at a rate equal to the sum of:

(a) Term SOFR (as defined in the Loan Agreement) and (b) 3.00 % (three hundred basis points) per annum.

The Company has agreed to reimburse Blackwells Capital LLC, in an amount agreed upon by the parties, for the Blackwells Parties’ reasonable due diligence expenses incurred on or prior to the date of the Share Ownership Agreement.

As of September 30, 2024, the Company has advanced approximately $ 5.8 million that has been used to purchase approximately 2.5 million shares of Braemar common stock.

Note receivable is summarized in the table below (dollars in thousands):

As of March 31, 2025, the Company has advanced approximately $ 8.1 million that has been used to purchase 3.5 million shares of Braemar common stock.

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The n ote receivable is summarized in the table below (dollars in thousands):

Interest Rate

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Note receivable SOFR + 3.00 %

$ 8,434 $ 8,283

We recognized interest income as presented in the table below (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

Line Item 2025 2024

3 unchanged sentences

Our assessment of impairment is based on considerable management judgment and assumptions.

No impairment charges were recorded for the three and nine months ended September 30, 2024.

Derivative Instruments

Interest Rate Derivatives —We are exposed to risks arising from our business operations, economic conditions and financial markets.

To manage these risks, we primarily use interest rate derivatives to hedge our debt and our cash flows, which include interest rate caps.

All derivatives are recorded at fair value.

Payments from counterparties on in-the-money interest rate caps are recognized as realized gains on our consolidated statements of operations.

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table summarizes the interest rate derivatives we entered into over the applicable periods:

Nine Months Ended September 30,

Interest rate caps:

Notional amount (in thousands) $ 824,680 $ 576,180

Strike rate low end of range 3.50 % 3.50 %

Strike rate high end of range 8.00 % 5.25 %

Effective date range January 2024 - August 2024

January 2023 - September 2023

Termination date range January 2025 - August 2026

October 2023 - October 2024

Total cost of interest rate caps (in thousands) $ 1,344 $ 3,981

_______________

(1) No instruments were designated as cash flow hedges.

Interest rate derivatives consisted of the following:

Interest rate caps:

September 30, 2024 December 31, 2023

Notional amount (in thousands) $ 1,155,280 $ 778,280

Strike rate low end of range 3.50 % 2.00 %

Strike rate high end of range 8.00 % 5.25 %

Termination date range October 2024 - August 2026

June 2024- January 2025

Aggregate principal balance on corresponding mortgage loans (in thousands) $ 1,074,693 $ 777,693

_______________

(1) No instruments were designated as cash flow hedges.

Warrants —On August 5, 2021, as part of the consideration paid to acquire the Cameo Beverly Hills (formerly known as the Mr.

C Beverly Hills Hotel) and five adjacent luxury residences, the Company issued 500,000 warrants for the purchase of Braemar common stock with a $ 6.00 strike price on or after August 5, 2021 until August 5, 2024.

The warrants expired worthless on August 5, 2024.

No impairment charges were recorded for the three months ended March 31, 2025.

Fair Value Measurements

11 unchanged sentences

However, when the valuation adjustments associated with our derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by us and our counterparties, which we consider significant ( 10 % or more) to the overall valuation of our derivatives, the derivative valuations in their entirety are classified in Level 3 of the fair value hierarchy.

Transfers of inputs between levels

Transfers of inputs between levels are determined at the end of each reporting period.

In determining the fair values of our derivatives at March 31, 2025, the SOFR interest rate forward curve (Level 2 inputs) assumed a downtrend from 4.319 % to 3.404 % for the remaining term of our derivatives.

Credit spreads (Level 3 inputs) used in determining the fair values derivatives assumed an uptrend in nonperformance risk for us and all of our counterparties through the maturity dates.

Investment in securities includes mortgage-backed securities.

Prices received from the vendor are analyzed based on various sources of observable market data.

If prices are not within certain tolerance levels that are based on the asset type’s characteristics, the exception is researched and, if the price is not able to be validated, an alternate pricing vendor is utilized.

BRAEMAR HOTELS & RESORTS INC.

1 unchanged sentence

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

are determined at the end of each reporting period.

In determining the fair values of our derivatives at September 30, 2024, the SOFR interest rate forward curve (Level 2 inputs) assumed a downtrend from 4.846 % to 3.013 % for the remaining term of our derivatives.

Credit spreads (Level 3 inputs) used in determining the fair values derivatives assumed an uptrend in nonperformance risk for us and all of our counterparties through the maturity dates.

Investment in securities includes mortgage-backed securities.

These securities are classified as available for sale and are generally reported at fair value utilizing Level 2 inputs where the Company obtains fair value measurements from an independent pricing service that uses matrix pricing, which is a mathematical technique widely used in the industry to value debt securities without relying exclusively on quoted prices for the specific securities but rather by relying on the securities’ relationship to other benchmark quoted securities (Level 2 inputs).

The fair value measurements consider observable data that may include dealer quotes, market spreads, cash flows and the bonds’ terms and conditions, among other things.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

4 unchanged sentences

(Level 3) Total

September 30, 2024

Investment in securities $ — $ 41,493 $ — $ 41,493

March 31, 2025

$ — $ 42,394 $ — $ 42,394 (1)

Derivative assets:

1 unchanged sentence

Total $ — $ 42,872 $ — $ 42,872

Derivative liabilities:

Warrants $ — $ — $ — $ — (2)

Net $ — $ 41,973 $ — $ 41,973

Quoted Market Prices (Level 1) Significant Other

3 unchanged sentences

December 31, 2024

$ — $ 41,535 $ — $ 41,535 (1)

Derivative assets:

1 unchanged sentence

$ — $ 41,891 $ — $ 41,891

Derivative liabilities:

Warrants $ — $ ( 12 ) $ — $ ( 12 ) (2)

Net $ — $ 2,835 $ — $ 2,835

__________________

(1) Reported as “investment in securities” in our condensed consolidated balance sheet.

(2) Reported as “derivative assets” in our condensed consolidated balance sheets.

(2) Reported as “derivative liabilities” in our condensed consolidated balance sheets.

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Effect of Fair Value Measured Assets and Liabilities on Condensed Consolidated Statements of Operations

1 unchanged sentence

Gain (Loss) Recognized in Income

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Derivative assets:

9 unchanged sentences

$ ( 739 ) (1)

$ ( 3,698 ) (1)

$ ( 5,244 ) (1)

Realized gain (loss) on interest rate caps 188 (1) (2)

1,671 (1) (2)

4,221 (1) (2)

6,162 (1) (2)

Net $ ( 198 ) $ 932

1 unchanged sentence

(2) Represents settled and unsettled payments from counterparties on interest rate caps.

The unrealized gain (loss) on investment in securities that was recognized as a change in other comprehensive income (loss) was $( 786,000 ) for both the three and nine months ended September 30, 2024.

The amortized cost of the CMBS at March 31, 2025 and December 31, 2024, was $ 42.3 million and $ 42.3 million, respectively.

The unrealized gain (loss) recognized as a change in other comprehensive income (loss) for the three months ended March 31, 2025 and March 31, 2024 was $ 859,000 and $ 0 , respectively.

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Summary of Fair Value of Financial Instruments

2 unchanged sentences

Accordingly, the estimates presented are not necessarily indicative of the amounts at which these instruments could be purchased, sold or settled.

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The carrying amounts and estimated fair values of financial instruments were as follows (in thousands):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Value Estimated

3 unchanged sentences

Investment in securities

$ 42,394 $ 42,394 $ 41,535 $ 41,535

Derivative assets 478 478 356 356

Financial liabilities measured at fair value:

Derivative liabilities $ — $ — $ 12 $ 12

Financial assets not measured at fair value:

12 unchanged sentences

Dividends and distributions payable 8,692 8,692 9,255 9,255

Due to Ashford Inc.

Due to Ashford Inc., net

3,511 3,511 4,267 4,267

13 unchanged sentences

The carrying amount of note receivable approximates its fair value.

We estimate the fair value of the note receivable to approximate the carrying value of $ 5.9 million at September 30, 2024.

We estimate the fair value of the note receivable to approximate the carrying value of $ 8.4 million as of March 31, 2025 and the carrying value of $ 8.3 million as of December 31, 2024.

This is considered a Level 2 valuation technique.

Derivative assets and derivative liabilities .

See notes 9 and 10 for a complete description of the methodology and assumptions utilized in determining fair values.

Derivative assets .

See note 8 for a complete description of the methodology and assumptions utilized in determining fair values.

Indebtedness, net.

Fair value of indebtedness is determined using future cash flows discounted at current replacement rates for these instruments.

Cash flows are determined using a forward interest rate yield curve.

The current replacement rates are determined by using the U.S.

Treasury yield curve or the index to which these financial instruments are tied, and adjusted for the credit spreads.

Credit spreads take into consideration general market conditions, maturity and collateral.

We estimated the fair value of the total indebtedness to be approximately 97.0 % of the carrying value of $ 1.2 billion at September 30, 2024, and approximately 96.0 % of the carrying value of $ 1.2 billion at December 31, 2023.

Fair value of indebtedness is determined using the loan terms, collateral value and financial data such as loan-to-value ratios, debt service coverage ratios, and interest rates for comparable loans.

We estimated the fair value of the total indebtedness to be approximately 99.9 % of the carrying value of $ 1.2 billion as of March 31, 2025, and approximately 98.8 % of the carrying value of $ 1.2 billion as of December 31, 2024.

These fair value estimates are considered a Level 2 valuation technique.

4 unchanged sentences

The following table reconciles the amounts used in calculating basic and diluted income (loss) per share (in thousands, except per share amounts):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Net income (loss) attributable to common stockholders - basic and diluted:

9 unchanged sentences

$ ( 2,566 ) $ 3,501

Dividends on preferred stock - Series E (inclusive of deemed dividends) — 9,401

Distributed and undistributed net income (loss) - diluted $ ( 2,566 ) $ 12,902

Weighted average common shares outstanding:

1 unchanged sentence

66,744 66,455

Effect of assumed conversion of preferred stock - Series E — 202,061

Weighted average common shares outstanding – diluted 66,744 268,516

Income (loss) per share - basic and diluted:

Net income (loss) allocated to common stockholders per share $ ( 0.04 ) $ 0.05

Income (loss) per share - diluted:

Net income (loss) allocated to common stockholders per share $ ( 0.04 ) $ 0.05

Due to their anti-dilutive effect, the computation of diluted income (loss) per share does not reflect the adjustments for the following items (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Net income (loss) allocated to common stockholders is not adjusted for:

Income (loss) allocated to unvested restricted shares $ — $ 8 $ — $ 25

Income (loss) allocated to unvested performance stock units $ 19 $ 23

13 unchanged sentences

Total 176,840 45,980

Redeemable Noncontrolling Interests in Operating Partnership

Redeemable noncontrolling interests in the operating partnership represent the limited partners’ proportionate share of equity and their allocable share of equity in earnings/losses of Braemar OP, which is an allocation of net income/loss attributable to the common unitholders based on the weighted average ownership percentage of these limited partners’ common units of limited partnership interest in the operating partnership (the “common units”) and units issued under our Long-Term Incentive Plan (the “LTIP units”) that are vested.

Each common unit may be redeemed, by the holder, for either cash or, at our sole discretion, up to one share of our REIT common stock, which is either:

(i) issued pursuant to an effective registration

BRAEMAR HOTELS & RESORTS INC.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Redeemable Noncontrolling Interests in Operating Partnership

Each common unit may be redeemed, by the holder, for either cash or, at our sole discretion, up to one share of our REIT common stock, which is either:

(i) issued pursuant to an effective registration statement;

(ii) included in an effective registration statement providing for the resale of such common stock;

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or (ii) the hypothetical sale of such assets, which results from a capital account revaluation, as defined in the partnership agreement, for our operating partnership.

The compensation committee of the board of directors of the Company may authorize the issuance of Performance LTIP units to certain executive officers and directors from time to time.

The compensation committee of our board of directors may authorize the issuance of Performance LTIP units to certain executive officers and directors from time to time.

The award agreements provide for the grant of a target number of Performance LTIP units that will be settled in common units of Braemar OP, if, when and to the extent the applicable vesting criteria have been achieved following the end of the performance and service period, which is generally three years from the grant date.

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The grant date fair value of the award may vary from period to period, as the number of performance grants earned may vary since the estimated probable achievement of certain performance targets may vary from period to period.

As of September 30, 2024, there were approximately 1.5 million unvested Performance LTIP units, representing 200 % of the target, outstanding.

In May 2024, approximately 45,000 LTIP units were issued to independent directors, with a fair value of approximately $ 126,000 , which vested immediately upon grant and have been expensed during the nine months ended September 30, 2024.

As of September 30, 2024, we have issued a total of approximately 3.0 million LTIP and Performance LTIP units, net of Performance LTIP cancellations.

All LTIP and Performance LTIP units, other than approximately 659,000 LTIP units and 353,000 Performance LTIP units issued from March 2015 to May 2024, had reached full economic parity with, and are convertible into, common units.

As of March 31, 2025, we have issued a total of approximately 3.8 million LTIP and Performance LTIP units, net of Performance LTIP cancellations.

All LTIP and Performance LTIP units, other than approximately 623,000 LTIP units and 1.2 million Performance LTIP units issued from March 2015 to December 2024, had reached full economic parity with, and are convertible into, common units.

The following table presents the redeemable noncontrolling interests in Braemar OP (in thousands) and the corresponding approximate ownership percentage of our operating partnership:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Redeemable noncontrolling interests in Braemar OP (in thousands) $ 26,430 $ 29,964

Adjustments to redeemable noncontrolling interests (1) (in thousands)

$ 165 $ 1,324

Ownership percentage of operating partnership 9.33 % 8.05 %

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We allocated net (income) loss to the redeemable noncontrolling interests as illustrated in the table below (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Net (income) loss attributable to redeemable noncontrolling interests in operating partnership $ 262 $ ( 296 )

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table presents the common units redeemed for cash (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

The following table presents the common units redeemed for common stock (in thousands):

Three Months Ended March 31,

Units redeemed

Cash value of common units redeemed

$ — $ — $ — $ 7,162 (1)

Fair value of common units redeemed (1)

____________________________________

(1) Includes Mr.

Bennett’s 1.4 million common units redeemed for cash of approximately $ 7.0 million during February 2023.

(1) The redemption value is the greater of historical cost or fair value.

The historical cost of the converted units was $ 2.3 million.

The following table presents the common units redeemed for cash (in thousands):

Three Months Ended March 31,

Units redeemed

Fair value of common units redeemed

Equity and Stock-Based Compensation

Common Stock Dividends —The following table summarizes the common stock dividends declared during the period (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Common stock dividends declared $ 3,372 $ 3,345

Stock Repurchases —On May 3, 2024, the board of directors approved a new share 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 $ 50 million.

As of March 31, 2025, the Company has not repurchased any common stock pursuant to this program.

Restricted Stock —We incur stock-based compensation expense in connection with restricted stock awarded to certain employees of Ashford LLC and its affiliates.

We also issue common stock to certain of our independent directors, which vests immediately upon issuance.

Performance Stock Units —The compensation committee of the board of directors of the Company may authorize the issuance of grants of performance stock units (“PSUs”) to certain executive officers and directors from time to time.

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The corresponding compensation cost is recognized ratably over the service period for the award as the service is rendered, based on the corresponding measurement date fair value of the award, which may vary from period to period, as the number of performance grants earned may vary since the estimated probable achievement of certain performance targets may vary from period to period.

Restricted Stock —We incur stock-based compensation expense in connection with restricted stock awarded to certain employees of Ashford LLC and its affiliates.

We also issue common stock to certain of our independent directors, which vests immediately upon issuance.

In May 2024, approximately 45,000 shares of common stock were issued to independent directors with a fair value of approximately $ 126,000 , which vested immediately upon grant and have been expensed during the nine months ended September 30, 2024.

8.25 % Series D Cumulative Preferred Stock —The Series D Preferred Stock dividend for all issued and outstanding shares is set at $ 2.0625 per annum per share.

8.25 % Series D Cumulative Preferred Stock —The dividend for all issued and outstanding shares of the Company’s Series D Cumulative Preferred Stock (the “Series D Preferred Stock”) is set at $ 2.0625 per annum per share.

The following table summarizes dividends declared (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Series D Cumulative Preferred Stock $ 825 $ 825

As of September 30, 2024, the Company has not repurchased any common stock pursuant to this program.

BRAEMAR HOTELS & RESORTS INC.

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Additionally, the Series B Convertible Preferred Stock contains cash redemption features that consist of:

1) an optional redemption in which on or after June 11, 2020, the Company may redeem shares of the Series B Convertible Preferred Stock, in whole or in part, for cash at a redemption price of $ 25.00 per share, plus any accumulated, accrued and unpaid dividends;

1) an optional redemption in which the Company may redeem shares of the Series B Convertible Preferred Stock, in whole or in part, for cash at a redemption price of $ 25.00 per share, plus any accumulated, accrued and unpaid dividends;

2) a special optional redemption, in which on or prior to the occurrence of a Change of Control (as defined in the Articles Supplementary), the Company may redeem shares of the Series B Convertible Preferred Stock, in whole or in part, for cash at a redemption price of $ 25.00 per share;

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The following table summarizes dividends declared (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Series B Convertible Preferred Stock $ 1,058 $ 1,058

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The Company is also offering a maximum of 8,000,000 shares of the Series E Preferred Stock pursuant to a dividend reinvestment plan (the “DRIP”) at $ 25.00 per share (the “Stated Value”).

BRAEMAR HOTELS & RESORTS INC.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Series E Preferred Stock ranks senior to all classes or series of the Company’s common stock and future junior securities, on a parity with each series of the Company’s outstanding preferred stock (the Series B Convertible Preferred stock, the Series D Preferred Stock and the Series M Preferred Stock (as defined below)) and with any future parity securities and junior to future senior securities and to all of the Company’s existing and future indebtedness, with respect to the payment of dividends and the distribution of amounts upon liquidation, dissolution or winding up of the Company’s affairs.

junior to future senior securities and to all of the Company’s existing and future indebtedness, with respect to the payment of dividends and the distribution of amounts upon liquidation, dissolution or winding up of the Company’s affairs.

Holders of the Series E Preferred Stock shall have the right to vote for the election of directors of the Company and on all other matters requiring stockholder action by the holders of the common stock, each share being entitled to vote to the same extent as one share of the Company’s common stock, and all such shares voting together as a single class.

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The Company has a DRIP that allows participating holders to have their Series E Preferred Stock dividend distributions automatically reinvested in additional shares of the Series E Preferred Stock at a price of $ 25.00 per share.

The issuance activity of the Series E Preferred Stock is summarized below (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Series E Preferred Stock shares issued (1)

Net proceeds (1)

$ — $ — $ — $ 85,444

__________________

(1) Exclusive of shares issued under the DRIP.

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Series E Preferred Stock does not meet the requirements for permanent equity classification prescribed by the authoritative guidance because of certain cash redemption features that are outside of the Company’s control.

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As a result of the Company’s determination that redemption is probable, the carrying value will be adjusted to the redemption amount each reporting period.

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The redemption value adjustment of Series E Preferred Stock is summarized below (in thousands):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Series E Preferred Stock $ 331,875 $ 352,502

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The following table summarizes dividends declared (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Series E Preferred Stock $ 6,616 $ 7,600

The redemption activities of Series E Preferred Stock is summarized below (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Series E Preferred Stock shares redeemed 1,033 186

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Each share is redeemable at any time, at the option of the holder, at a redemption price of $ 25.00 per share, plus any accumulated, accrued and unpaid dividends, less a redemption fee.

Starting on the second anniversary, each share is redeemable at any time, at the option of the Company, at a redemption price of $ 25.00 per share, plus any accumulated, accrued and unpaid

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

dividends (with no redemption fee).

Starting on the second anniversary, each share is redeemable at any time, at the option of the Company, at a redemption price of $ 25.00 per share, plus any accumulated, accrued and unpaid dividends (with no redemption fee).

The Series M Preferred Stock is also subject to conversion upon certain events constituting a change of control.

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• 0 % of the Stated Value beginning on the first anniversary from the Series M Original Issue Date of the shares of Series M Preferred Stock to be redeemed.

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Company has the right, in its sole discretion, to redeem the shares in cash, or in an equal number of shares of common stock or any combination thereof, calculated based on the closing price per share for the single trading day prior to the date of redemption.

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The Company has a DRIP that allows participating holders to have their Series M Preferred Stock dividend distributions automatically reinvested in additional shares of the Series M Preferred Stock at a price of $ 25.00 per share.

The issuance activity of Series M Preferred Stock is summarized below (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Series M Preferred Stock shares issued (1)

Net proceeds (1)

$ — $ — $ — $ 12,869

__________________

(1) Exclusive of shares issued under the DRIP.

The Series M Preferred Stock does not meet the requirements for permanent equity classification prescribed by the authoritative guidance because of certain cash redemption features that are outside the Company’s control.

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The redemption value adjustment of Series M Preferred stock is summarized below (in thousands):

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Series M Preferred Stock $ 36,489 $ 36,916

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(1) Reflects the excess of the redemption value over the accumulated carrying value.

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following table summarizes dividends declared (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Series M Preferred Stock $ 770 $ 924

The redemption activities of Series M Preferred Stock is summarized below (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Series M Preferred Stock shares redeemed 19 87

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We pay a monthly base fee equal to 1/12 of the sum of (i) 0.70 % of the total market capitalization of our company for the prior month, plus (ii) the Net Asset Fee Adjustment (as defined in our advisory agreement), if any, on the last day of the prior month during which our advisory agreement was in effect;

provided, however, in no event shall the base fee for any month be less than the minimum base fee as provided by our advisory agreement.

provided, however, in no event shall the base fee for

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

any month be less than the minimum base fee as provided by our advisory agreement.

The base fee is payable on the fifth business day of each month.

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The following table summarizes the advisory services fees incurred (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Advisory services fee

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Reimbursable expenses (1)

3,231 2,028 8,457 6,092

Equity-based compensation (2)

427 1,599 2,418 6,391

Incentive fee 82 —

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(2) Equity-based compensation is associated with equity grants of Braemar’s common stock, PSUs, LTIP units and Performance LTIP units awarded to officers and employees of Ashford LLC.

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

On September 27, 2022, an agreement was entered into by Ashford Inc., Ashford Trust and Braemar pursuant to which the Advisor is to implement the REITs’ cash management strategies.

This includes actively managing the REITs excess cash by primarily investing in short-term U.S.

Treasury securities.

The annual fee is equal to the lesser of (i) 20 bps of the average daily balance of the funds managed by the Advisor and (ii) the actual rate of return realized by the cash management strategies;

provided that in no event will the cash management fee be less than zero.

The fee is payable monthly in arrears.

On March 2, 2023, the Company entered into a Limited Waiver Under Advisory Agreement (the “2023 Limited Waiver”) with Braemar OP, Braemar TRS and its Advisor.

Pursuant to the 2023 Limited Waiver, the Company, Braemar OP, Braemar TRS and the Company’s Advisor waived the operation of any provision in the advisory agreement that would otherwise limit our ability, in our discretion and at our cost and expense, to award during the first and second fiscal quarters of calendar year 2023, cash incentive compensation to employees and other representatives of the Advisor.

On March 11, 2024, we entered into a Limited Waiver Under Advisory Agreement with Ashford Inc.

and Ashford LLC (the “Advisory Agreement Limited Waiver”).

Pursuant to the Advisory Agreement Limited Waiver, the Company, the Operating Partnership, TRS and the Advisor waive the operation of any provision in our advisory agreement that would otherwise limit the ability of the Company in its discretion, at the Company’s cost and expense, to award during calendar year 2024, cash incentive compensation to employees and other representatives of the Advisor.

Pursuant to the Company’s hotel management agreements with each hotel management company, the Company bears the economic burden for casualty insurance coverage.

Under the advisory agreement, Ashford Inc.

secures casualty insurance policies to cover Ashford Trust, Braemar, Stirling OP, their hotel managers, as needed, and Ashford Inc.

The total loss estimates included in such policies are based on the collective pool of risk exposures from each party.

has managed the casualty insurance program and beginning in December 2023, Warwick Insurance Company (“Warwick”), a subsidiary of Ashford Inc., provides and manages the general liability, workers’ compensation and business automobile insurance policies within the casualty insurance program.

On each of March 11, 2024 and March 10, 2025, we entered into a Limited Waiver Under Advisory Agreement with Ashford Inc.

and Ashford LLC (collectively, the “Advisory Agreement Limited Waivers”).

Pursuant to the Advisory Agreement Limited Waivers, the Company, the Operating Partnership, TRS and the Advisor waive the operation of any provision in our advisory agreement that would otherwise limit the ability of the Company in its discretion, at the Company’s cost and expense, to award during calendar years 2024 and 2025, respectively, cash incentive compensation to employees and other representatives of the Advisor.

Pursuant to the Company’s hotel management agreements with each hotel management company, the Company bears the economic burden for casualty insurance coverage which includes worker’s compensation, general liability and auto liability coverages.

The hotel management companies procure worker’s compensation insurance, the expenses of which are passed through to the Company.

Under the advisory agreement and hotel management agreements, Ashford Inc.

secures general liability and auto liability policies to cover Ashford Trust, Braemar, Stirling OP, their hotel managers, as needed, and Ashford Inc.

The total cost estimates covered by such policies are based on the collective pool of risk exposures from each party.

delegates the management of the casualty insurance program to Warwick Insurance Company, LLC (“Warwick”), a subsidiary of Ashford Inc.

which issues policies covering general liability, workers’ compensation and auto liability losses.

Each year Ashford Inc.

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We engage Lismore or its subsidiaries to provide debt placement services and assist with loan modifications or refinancings on our behalf and brokerage services.

For the three and nine months ended September 30, 2024, we incurred fees of $ 1.8 million and $ 2.9 million, respectively.

We incurred fees from Lismore or its subsidiaries of $ 1.3 million and $ 1.5 million for the three and nine months ended September 30, 2023.

Ashford Securities

On December 31, 2020, an Amended and Restated Contribution Agreement (the “Amended and Restated Contribution Agreement”) was entered into by Ashford Inc., Ashford Trust and Braemar (collectively, the “Parties” and each individually, a “Party”) with respect to funding certain expenses of Ashford Securities LLC, a subsidiary of Ashford Inc.

(“Ashford Securities”).

Beginning on the effective date of the Amended and Restated Contribution Agreement, costs were allocated based upon an allocation percentage of 50 % to Ashford Inc., 50 % to Braemar and 0 % to Ashford Trust.

Upon reaching the earlier of $ 400 million in aggregate capital raised, or June 10, 2023, there was to be a true-up (the “Amended and Restated True-Up Date”) among Ashford Inc., Ashford Trust and Braemar whereby the actual amount contributed by each company was based on the actual amount of capital raised by Ashford Inc., Ashford Trust and Braemar, respectively, through Ashford Securities (the resulting ratio of contributions among the Parties, the “Initial True-up Ratio”).

On January 27, 2022, Ashford Trust, Braemar and Ashford Inc.

entered into a Second Amended and Restated Contribution Agreement which provided for an additional $ 18 million in expenses to be reimbursed, with all expenses allocated 45 % to Ashford Trust, 45 % to Braemar and 10 % to Ashford Inc.

On February 1, 2023, Braemar entered into a Third Amended and Restated Contribution Agreement, which provided that after the Amended and Restated True-Up Date, capital contributions for the remainder of fiscal year 2023 would be divided between each Party based on the Initial True-Up Ratio, there would be a true up reflecting amounts raised by Ashford Securities since June 10, 2019, and thereafter, the capital contributions would be divided among each Party in accordance with the cumulative ratio of capital raised by the Parties.

Effective January 1, 2024, Braemar entered into a Fourth Amended and Restated Contribution Agreement with Ashford Inc.

and Ashford Trust, which states that, notwithstanding anything in the prior contribution agreements:

(1) the Parties equally

For the three months ended March 31, 2025 and 2024, we incurred fees from Lismore or its subsidiaries of $ 1.7 million and $ 1.1 million, respectively.

BRAEMAR HOTELS & RESORTS INC.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

split responsibility for all aggregate contributions made by them to Ashford Securities through September 30, 2021;

and (2) thereafter, their contributions for each quarter will be based on the ratio of the amounts raised by each Party through Ashford Securities in the prior quarter compared to the total aggregate amount raised by the Parties through Ashford Securities for the prior quarter.

To the extent contributions made by any of the Parties through December 31, 2023 differed from the amounts owed pursuant to the foregoing, the Parties shall make true up payments to each other to settle the difference.

During the first quarter of 2024, the funding requirement was revised based on the aggregate capital raised through Ashford Securities.

This resulted in Braemar receiving a payment of approximately $ 5.9 million from Ashford Inc., which resulted in a credit to expense of approximately $ 5.6 million that is included in “corporate general and administrative” on the condensed consolidated statements of operations for the nine months ended September 30, 2024.

As of September 30, 2024, Braemar has funded approximately $ 12.9 million and has a pre-funded balance of $ 1.9 million that is included in “other assets” on the condensed consolidated balance sheet.

As of December 31, 2023, Braemar had funded approximately $ 20.9 million and had a pre-funded balance of approximately $ 693,000 included in “other assets” and a receivable of approximately $ 3.5 million included in “due to Ashford Inc., net” on the consolidated balance sheet.

During the first quarter of 2024, there was also a true-up of the capital contributions in accordance with the Third Amended and Restated Contribution Agreement made through December 31, 2023, which resulted in a payment of $ 3.5 million from Ashford Inc.

Ashford Securities

The Company, Ashford Trust, and Ashford Inc.

are party to the Fourth Amended and Restated Contribution Agreement with respect to funding certain expenses of Ashford Securities LLC, a subsidiary of Ashford Inc.

(“Ashford Securities”).

As of March 31, 2025 and December 31, 2024 , Braemar has funded approximately $ 12.9 million and has a pre-funded balance of $ 797,000 that is included in “other assets” on the condensed consolidated balance sheet.

During the first quarter of 2024, there was a true-up of the funding requirement based on the aggregate capital raised that resulted to a credit to expense of $ 5.6 million for the three months ended March 31, 2024.

The table below summarizes the amount Braemar has expensed related to reimbursed operating expenses of Ashford Securities (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

Line Item 2025 2024

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Hotel Management Services

At September 30, 2024, Remington Hospitality managed four of our 15 hotel properties.

As of March 31, 2025, Remington Hospitality managed four of our 15 hotel properties.

We pay monthly hotel management fees equal to the greater of approximately $ 17,000 per hotel (increased annually based on consumer price index adjustments) or 3 % of gross revenues, as well as annual incentive management fees, if certain operational criteria were met, and other general and administrative expense reimbursements primarily related to accounting services.

Our hotel management agreement also requires that we fund property-level operating costs, including the hotel manager's payroll and related costs.

Investment in OpenKey

OpenKey, Inc.

(“OpenKey”) is a hospitality-focused mobile key platform that provides a universal smart phone app and related hardware and software for keyless entry into hotel guest rooms.

As of March 31, 2025 and December 31, 2024, the Company had made equity investments in OpenKey totaling $ 2.9 million resulting in an ownership interest of 7.9 % accounted for under the equity method of accounting.

During the fourth quarter of 2024, we determined that the estimated fair value of the investment in OpenKey was less than our carrying amount and fully impaired our investment as of December 31, 2024.

The Company also entered into a loan funding agreement with Ashford Inc.

The loan bears interest at an annual rate of 15 %.

During the fourth quarter of 2024, we determined that the full amount of the note receivable was not collectible, the note receivable was impaired and the recognition of interest income ceased.

As of March 31, 2025 and December 31, 2024, the carrying amount of the loan was $ 145,000 included in “investment of unconsolidated entity” on our condensed consolidated balance sheets.

Commitments and Contingencies

Restricted Cash —Under certain management and debt agreements for our hotel properties existing at September 30, 2024, escrow payments are required for insurance, real estate taxes and debt service.

Restricted Cash —Under certain management and debt agreements for our hotel properties existing at March 31, 2025, escrow payments are required for insurance, real estate taxes and debt service.

In addition, for certain properties based on the terms of the underlying debt and management agreements, we escrow 3 % to 5 % of gross revenues for capital improvements.

Franchise Fees —We currently have one hotel property that operates under a franchise agreement with a 25-year term.

The term begins upon the completion of conversion of the Cameo Beverly Hills.

Under the terms of the agreement, we will pay (i) 3 % of gross rooms revenue for the preceding calendar month during the first three years of the agreement;

(ii) 4 % of gross

BRAEMAR HOTELS & RESORTS INC.

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

rooms revenue for the preceding calendar month during year four;

Franchise Fees —We currently have one hotel property that operates under a franchise agreement with a 25-year term.

The term begins upon the completion of conversion of the Cameo Beverly Hills.

Under the terms of the agreement, we will pay:

(i) 3 % of gross rooms revenue for the preceding calendar month during the first three years of the agreement;

(ii) 4 % of gross rooms revenue for the preceding calendar month during year four;

and (iii) 5 % of the gross rooms revenue for the preceding calendar month for the remainder of the term.

As of September 30, 2024, we are currently paying 3 % of gross revenues.

As of March 31, 2025, we are currently paying 3 % of gross revenues.

The table below summarizes the franchise fees incurred (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

Line Item 2025 2024

Other hotel expenses $ 70 $ 80

Management Fees —Under hotel management agreements for our hotel properties existing at September 30, 2024, we pay a monthly hotel management fee equal to the greater of approximately $ 17,000 per hotel (increased annually based on consumer price index adjustments) or 3 % of gross revenues, or in some cases, 3.0 % to 5.0 % of gross revenues, as well as annual incentive management fees, if applicable.

Management Fees —Under hotel management agreements for our hotel properties existing at March 31, 2025, we pay a monthly hotel management fee equal to the greater of approximately $ 17,000 per hotel (increased annually based on consumer price index adjustments) or 3 % of gross revenues, or in some cases, 3.0 % to 5.0 % of gross revenues, as well as annual incentive management fees, if applicable.

These management agreements expire from November 2029 through December 2065, with renewal options.

If we terminate a management agreement prior to its expiration, we may be liable for estimated management fees through the remaining term, liquidated damages or, in certain circumstances, we may substitute a new management agreement.

Our hotel management agreements also require that we fund property-level operating costs, including the hotel manager's payroll and related costs.

Income Taxes —We and our subsidiaries file income tax returns in the federal jurisdiction and various states.

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On February 13, 2024, the judge ordered the parties to submit additional briefing related to on-site breaks.

The Court has ordered the parties to complete a second mediation no later than January 31, 2025.

While we believe it is reasonably possible that we may incur a loss associated with this litigation, because there remains uncertainty under California law with respect to a significant legal issue, discovery relating to class members continues, and the trial judge retains discretion to award lower penalties than set forth in the applicable California employment laws, we do not believe that any potential loss to the Company is reasonably estimable at this time.

As of September 30, 2024, no amounts have been accrued.

A tentative settlement has been reached subject to the respective parties obtaining various approvals.

As of March 31, 2025, the estimated settlement liability amount has been accrued.

On June 8, 2022, a lawsuit was filed against various Hilton entities on behalf of a class of all hourly employees at all Hilton-branded managed properties in California, including Hilton La Jolla Torrey Pines.

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At the end of the mediation, the mediator submitted a mediator’s proposal for approximately $ 3.5 million, to which the parties have since agreed to.

The allocation to Hilton La Jolla Torrey Pines is approximately $ 371,000 , which has been accrued as of September 30, 2024.

The allocation to Hilton La Jolla Torrey Pines is approximately $ 401,000 , which was accrued as of March 31, 2025.

On August 4, 2020, a lawsuit, Benjamin Zermeno v.

Beverly Hills Marriott, was filed in Alameda County Superior Court as a PAGA representative action alleging various wage and hour violations of all Remington Hospitality managed California properties.

The plaintiff’s individual claims were compelled to arbitration.

On August 18, 2022, another lawsuit, Cristina Catalano v.

Beverly Hills Marriott and Mr.

C, was filed as a PAGA representative action alleging various wage and hour violations of all Remington Hospitality managed California properties.

The co-defendant separately settled and the individual arbitration has also settled.

A private mediation was held on December 27, 2024 to globally resolve the three outstanding matters.

A tentative settlement was reached subject to the parties finalizing the agreement and court approval.

As of March 31, 2025, the estimated settlement liability amount has been accrued.

We are also engaged in other legal proceedings that have arisen but have not been fully adjudicated.

To the extent the claims giving rise to these legal proceedings are not covered by insurance, they relate to the following general types of claims:

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

employment matters, tax matters and matters relating to compliance with applicable law (for example, the Americans with Disabilities Act and similar state laws).

2 unchanged sentences

Based on the information available to us relating to these legal proceedings and/or our experience in similar legal proceedings, we do not believe the ultimate resolution of these proceedings, either individually or in the aggregate, will have a material adverse effect on our consolidated financial position, results of operations or cash flow.

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

During the quarter ended September 30, 2023, we had a cyber incident that resulted in the potential exposure of certain personal information.

1 unchanged sentence

All systems have been restored.

We believe that we maintain a sufficient level of insurance coverage related to such events, and the related incremental costs incurred to date are immaterial.

In February of 2024, two class action lawsuits were filed, one in the U.S.

5 unchanged sentences

District Court for the Northern District of Texas.

On May 17, 2024, we filed a Motion to Dismiss the Consolidated Class Action Complaint, which is currently pending before the Court.

The parties have reached an agreement, subject to final Court approval, to resolve the class action suit.

The amount of the class settlement is approximately $ 485,000 .

The hearing for final Court approval of the settlement is scheduled for August 27, 2025.

Our assessment may change depending upon the development of any current or future legal proceedings, and the final results of such legal proceedings cannot be predicted with certainty.

1 unchanged sentence

Segment Reporting

We operate in one business segment within the hotel lodging industry:

We operate in one reportable business segment within the hotel lodging industry:

direct hotel investments.

Direct hotel investments refers to owning hotel properties through either acquisition or new development.

We report operating results of direct hotel investments on an aggregate basis as substantially all of our hotel investments have similar economic characteristics and exhibit similar long-term financial performance.

As of September 30, 2024 and December 31, 2023, all of our hotel properties were in the U.S.

We report operating results of direct hotel investments on an aggregate basis as substantially all of our hotel investments;

(i) offer similar products and services to their customers in the form of hotel rooms, food and beverage, and ancillary services:

(ii) utilize third-party hotel management companies to deliver its products and services to its customers;

(iii) are designed and operated to appeal to similar individuals, groups, leisure, and business customers;

and (iv) third-party hotel managers utilize the same methods (direct hotel sales and various online booking portals) to distribute the Company’s products and services.

As of March 31, 2025 and December 31, 2024, all of our hotel properties were in the U.S.

and its territories.

The Company’s chief operating decision maker (“CODM”) is its President and Chief Executive Officer.

Each hotel property derives revenue primarily from guestroom sales, food and beverage sales, and revenues from other lodging services and amenities.

The accounting policies of each operating segment are the same as those described in the summary of significant accounting policies in note 2 of the consolidated financial statements included in our 2024 Annual Report on Form 10-K.

The CODM reviews and makes decisions on all aspects of the Company’s business using all available financial and non-financial data for each hotel individually.

Capital allocation decisions to acquire, sell, enhance, redevelop, or perform renewal and replacement expenditures are determined on a hotel-by-hotel basis.

Specifically, the CODM reviews the results of each hotel to assess the hotel’s profitability.

The key measure the CODM uses to allocate resources and assess performance is individual hotel net income (loss) before interest expense, income taxes, depreciation, and amortization, adjusted to exclude certain items determined by management to not be reflective of its ongoing operating performance or incurred in the normal course of business (Hotel Adjusted EBITDA).

The adjustments include gains and losses on hotel dispositions, impairment charges, pre-opening costs associated with extensive renovation projects, property-level legal settlements, restructuring, severance, and management transition costs, and other expenses identified by management to be non-recurring.

The CODM does not regularly review asset information by segment.

BRAEMAR HOTELS & RESORTS INC.

AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The following tables include revenues, significant hotel operating expenses, and Hotel Adjusted EBITDA for the Company’s hotels, reconciled to the consolidated amounts included in the Company’s condensed consolidated statements of operations (in thousands):

Three Months Ended March 31,

Rooms $ 136,092 $ 138,552

Food and beverage 51,788 53,547

Other hotel revenue 27,940 26,980

Total hotel revenue $ 215,820 $ 219,079

Rooms $ 28,219 $ 28,264

Food and beverage 40,210 40,717

Direct expenses 9,459 9,769

Indirect expenses:

Property, general and administration 15,398 16,603

Sales and marketing 13,173 13,381

Information and telecommunications systems 2,075 2,048

Repairs and maintenance 7,772 7,662

Energy 5,859 5,965

Lease expense 554 1,173

Ownership expenses 982 1,176

Incentive management fee 4,229 3,850

Management fees 6,737 6,866

Property taxes 5,951 5,710

Other taxes 468 513

Insurance 3,993 4,403

Total expenses

145,079 148,100

Hotel adjusted EBITDA

$ 70,741 $ 70,979

Three Months Ended March 31,

Hotel adjusted EBITDA $ 70,741 $ 70,979

Ownership expenses included in other hotel expenses ( 875 ) 1,551

Ownership expenses included in property taxes, insurance and other ( 53 ) ( 59 )

Management fees ( 173 ) ( 110 )

Depreciation and amortization ( 23,395 ) ( 25,420 )

Advisory services fee ( 6,611 ) ( 6,700 )

Corporate, general and administrative ( 2,894 ) 2,226

Equity in earnings (loss) of unconsolidated entities — ( 49 )

Interest income 1,888 796

Interest expense and amortization of discounts and loan costs ( 24,827 ) ( 26,491 )

Write-off of loan costs and exit fees ( 1,464 ) ( 721 )

Realized and unrealized gain (loss) on derivatives ( 198 ) 932

Income tax (expense) benefit ( 1,467 ) ( 1,452 )

Net income (loss) $ 10,672 $ 15,482

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements