Ashford Hospitality Prime, Inc. (Form: 8-K, Received: 04/08/2016 08:35:49)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): April 7, 2016

ASHFORD HOSPITALITY PRIME, INC.

(Exact Name of Registrant as Specified in its Charter)

Maryland	001-35972	46-2488594
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

14185 Dallas Parkway, Suite 1100

Dallas, Texas 75254

(Address of principal executive offices) (Zip Code)

(972) 490-9600

(Registrant’s telephone number, including area code)

N/A

(Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry Into a Material Definitive Agreement.

On April 7, 2016, Ashford Prime OP General Partner LLC (the “ General Partner ”), a Delaware limited liability company and wholly-owned subsidiary of Ashford Hospitality Prime, Inc. (the “ Company ”), as general partner of Ashford Hospitality Prime Limited Partnership (“ Ashford Prime OP ”), entered into an amendment (“ Amendment No. 1 ”) to the Second Amended and Restated Agreement of Limited Partnership of Ashford Hospitality Prime Limited Partnership, dated February 1, 2016 (the “ Amended Partnership Agreement ”). As described herein, Amendment No. 1 reversed those prior amendments, including with respect to the issuance of the Company’s Series C Preferred Stock, par value $0.01 per share (the “ Series C Preferred Stock ”), as further described below.

As the Company previously announced on February 2, 2016, the General Partner and the requisite percentage of limited partners of Ashford Prime OP (the “ Limited Partners ”) approved the Amended Partnership Agreement, which broadened in several ways the rights of the General Partner that were previously set forth in the Amended and Restated Agreement of Limited Partnership of Ashford Hospitality Prime Limited Partnership, dated November 19, 2013. The amendments made in the Amended Partnership Agreement included a number of changes (collectively, the “ February 1 Amendments ”), including the following: the rights of the General Partner to indemnification and advancement of expenses were broadened; additional requirements were added in order for the Limited Partners to redeem their limited partnership units; the requisite percentage for the Limited Partners to call a special meeting was increased to 66 2/3%; the General Partner was granted additional time to obtain necessary approvals for issuing any shares of common stock, par value $0.01 per share (the “ Common Stock ”), of the Company, following a redemption of the units; and the consent rights of the Limited Partners were revised to require that notice of any objections be provided within a shorter period of time. The February 1 Amendments are described in further detail in the Company’s Form 8-K filed on February 2, 2016. As consideration for the Limited Partners to consent to the amendments set forth in the Amended Partnership Agreement, the Company agreed to issue to qualified Limited Partners, from time to time, shares of Series C Preferred Stock that would vote alongside the holders of the Company’s Common Stock on all matters submitted to stockholders on a one-for-one as-converted basis but otherwise have de minimis economic and other rights.

In response to feedback from the investor community, the Company has determined to refrain from issuing the Series C Preferred Stock unless and until the issuance of the Series C Preferred Stock, in a form and manner that complies with all applicable state and federal laws and stock exchange rules, shall have been approved by the Company’s stockholders (the “ Series C Approval ”). Accordingly, the General Partner has agreed to reverse the February 1 Amendments unless and until the Series C Approval has been sought and obtained. The Company has no immediate plans to seek the Series C Approval.

The foregoing is qualified in its entirety by reference to, and should be read in conjunction with, the complete text of Amendment No. 1 filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated by reference into this Item 1.01.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

Exhibit Number	Exhibit Description

Exhibit 10.1	Amendment No. 1 to Second Amended and Restated Agreement of Limited Partnership of Ashford Hospitality Prime Limited Partnership

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, Ashford Hospitality Prime, Inc. has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Dated: April 8, 2016	ASHFORD HOSPITALITY PRIME, INC.

	By:	/s/ David A. Brooks
		David A. Brooks
		Chief Operating Officer, General Counsel and Secretary

EXHIBIT INDEX

Exhibit No.	Description

10.1	Amendment No. 1 to Second Amended and Restated Agreement of Limited Partnership of Ashford Hospitality Prime Limited Partnership

AMENDMENT NO. 1 TO
SECOND AMENDED AND RESTATED
AGREEMENT OF LIMITED PARTNERSHIP
OF
ASHFORD HOSPITALITY PRIME LIMITED PARTNERSHIP

This Amendment No. 1 to Second Amended and Restated Agreement of Limited Partnership (this “ Amendment ”) is entered into effective April 7, 2016 (the “ Effective Date ”). Capitalized terms used but not defined herein shall have the meanings given to such terms in the Amended Agreement (as defined below).

WHEREAS, Ashford Hospitality Prime Limited Partnership (the “ Partnership ”) was formed as a limited partnership under the laws of the State of Delaware by the filing of a Certificate of Limited Partnership with the Secretary of State of Delaware on April 5, 2013;

WHEREAS, Ashford Prime OP General Partner LLC, a Delaware limited liability company (the “ General Partner ”), and Ashford Prime OP Limited Partner LLC, a Delaware limited liability company, entered into the Agreement of Limited Partnership as of April 5, 2013, as amended by the General Partner and the Limited Partners (defined below) on November 13, 2013 (such agreement, the “ Prior Agreement ”) and February 1, 2016 (such agreement, the “ Amended Agreement ”);

WHEREAS, the Amended Agreement amended and restated the Prior Agreement to broaden in various ways the rights of Ashford Hospitality Prime, Inc. (the “ Company ”) in the Partnership, as the parent of the General Partner (such amendments, collectively, the “ Recent Amendments ”).

WHEREAS, the General Partner desires to amend the Amended Agreement (“ Amendment No. 1 ”), such that the Recent Amendments shall no longer remain in effect; provided , however , that the Recent Amendments shall immediately become effective upon receipt of the Series C Approval (as defined below).

WHEREAS, Section 11.1 of the Amended Agreement permits the General Partner and the Limited Partners to amend the Amended Agreement;

WHEREAS, based on feedback from the investor community and as consideration for the Limited Partners (as defined in the Amended Agreement) to consent to Amendment No. 1, the Company proposes to refrain from issuing any shares of Series C Preferred Stock (the “ Series C Preferred Stock ”) of the Company in respect of Partnership Units (as defined in the Amended Agreement) unless and until the issuance of the Series C Preferred Stock, in a form and manner that complies with all applicable state and federal laws and stock exchange rules, shall have been approved by the stockholders of the Company (the “ Series C Approval” );

WHEREAS, the Company, which is the sole member of the General Partner and of Ashford Prime OP Limited Partner LLC, has directed the General Partner and Ashford Prime OP Limited Partner LLC to amend the Amended Agreement as set forth herein; and

WHEREAS, the General Partner and Ashford Prime OP Limited Partner LLC desire to so amend the Amended Agreement, as of the Effective Date.

NOW, THEREFORE, in consideration of the foregoing, of the mutual covenants between the parties hereto, and of other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1. The amendments made to Sections 4.3(b) , 4.3(e)(ii) , 6.1(f) , 6.4(c) , 6.4(d) , 6.4(j) , 7.4(a) , 7.4(b) , 9.5(c) , 9.5(e) , 9.12 , 9.13 , 13.13(c) and 13.2 of the Amended Agreement shall cease to be effective, and the terms of such sections of the Prior Agreement shall govern, unless and until the Series C Approval shall have been obtained.

2. Except as described above, the terms and provisions of the Amended Agreement shall remain in full force and effect.

[Signature Pages Follow]

IN WITNESS WHEREOF, the parties have hereunto set their hands as of the day and year first above written.

	GENERAL PARTNER:

	Ashford Prime OP General Partner LLC, a Delaware limited liability company


	By:	/s/ David A. Brooks
		David A. Brooks, Vice President

	LIMITED PARTNER:

	Ashford Prime OP General Partner LLC, a Delaware limited liability company as a Limited Partner of Ashford Hospitality Prime Limited Partnership


	By:	/s/ David A. Brooks
		David A. Brooks, Vice President

The undersigned has executed this Amendment No. 1 not as a Partner of the Partnership but to agree to the provisions of this Amendment No. 1 imposing obligations on, granting rights to, the Company.

	ASHFORD HOSPITALITY PRIME, INC.

	By:	/s/ David A. Brooks
		David A. Brooks, Chief Operating Officer and General Counsel