UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

(Rule 13d-101)

INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT

TO § 240.13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO

§ 240.13d-2(a)

(Amendment No. 2)¹

Ashford Hospitality Trust, Inc.

(Name of Issuer)

Common Stock, par value $0.01 per share 

(Title of Class of Securities)

044103109

(CUSIP Number)

CHRISTOPHER SWANN 

CYGNUS CAPITAL, INC. 

3060 Peachtree Road NW, Suite 1080

Atlanta, Georgia 30305

(404) 465-3685

STEVE WOLOSKY, ESQ.,

ELIZABETH GONZALEZ- SUSSMAN, ESQ.,

OLSHAN FROME WOLOSKY LLP

1325 Avenue of the Americas

New York, New York 10019

(212) 451-2300

(Name, Address and Telephone Number of Person

Authorized to Receive Notices and Communications)

September 28, 2020

(Date of Event Which Requires Filing of This Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box ☒.

1              The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

Note. Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.

(Continued on following pages)

(1) Includes 70,000 Shares (as defined in Item 1) underlying certain call options.

The following constitutes Amendment No. 2 to the Schedule 13D filed by the undersigned (“Amendment No. 2”). This Amendment No. 2 amends the Schedule 13D as specifically set forth herein.

Item 4.                    Purpose of Transaction.

Item 4 is hereby amended to add the following:

On September 28, 2020, the Reporting Persons issued a press release highlighting significant reservations made by proxy advisor firm Institutional Shareholder Services in its report dated September 25, 2020 concerning the Issuer’s upcoming special meeting of stockholders scheduled to be held on October 6, 2020. In the press release, the Reporting Persons also noted reports issued by industry analysts suggesting the Issuer and the hospitality industry should improve over the next year or two. The Reporting Persons believe such reports call into question the Issuer’s rationale for needing to dilute common stockholders by approximately 94% through exchange offers of all of the outstanding preferred stock into common stock. The full text of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. 

Item 7.                    Material to be Filed as Exhibits.

Item 7 is hereby amended to add the following exhibit:

SIGNATURES

After reasonable inquiry and to the best of his knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.

Dated: September 28, 2020

Reports Issued By Industry Analysts and Proxy Advisory Firm ISS Call into Question Rationale of Ashford Hospitality Trust, Inc.’s Proposed ~94% Dilutive Exchange Offers

ATLANTA, GEORGIA, September 28, 2020 /PRNewswire/-- Cygnus Capital, Inc. (together with its affiliates, “Cygnus Capital”), one of the largest stockholders of Ashford Hospitality Trust, Inc. (the “Company” or “AHT”) (NYSE:AHT), beneficially owning approximately 7.8% of the Company’s outstanding common stock, today highlighted significant reservations made by Institutional Shareholder Services (“ISS”) in its report dated September 25, 2020 concerning AHT’s upcoming special meeting of stockholders scheduled to be held on October 6, 2020. In ISS’s recommendation for stockholders to proceed “with caution,” ISS noted the following:

“Over the years, unaffiliated shareholders have been subjected to egregious governance-related practices and transactions that seemed to benefit one company in the Ashford group at the expense of another, all of which one could argue were in part to perpetuate the influence and control of the Bennett family over these entities.”

“The fact that the Ashford-related companies received administrative subpoenas in June 2020 relating to an SEC investigation into related party transactions and accounting policies should also give shareholders pause when considering the merit of any company action and whether it is truly in their interests.”

“Investors that agree with the dissident's outlook for an industry recovery may likewise opt for a wait-and-see approach, particularly since the company's efficient means of value destruction have stripped the majority of the downside risk that would typically accompany such a decision.”

Despite AHT management and industry data showing the hospitality industry is improving, management would like you to believe they are diluting common stockholders because it is the only option. It is not. Diluting common stockholders seems to be the best option to keep fees flowing to AHT’s external manager, Ashford, Inc. (“AINC”), which is controlled by AHT’s insiders. Just look at the facts:

AHT common stockholders shouldn’t be essentially wiped out while the Bennett family and other AHT insiders continue to enrich themselves. AHT common stockholders have the power to stop the exchange offers by voting AGAINST the proposals to amend AHT’s corporate charter and issue common stock in the exchange offers at AHT’s upcoming special meeting (the “special meeting proposals”).

The Hospitality Industry Is Showing Signs of Recovery.

After being hit by one of the worst economic crises in history, the hospitality industry is showing signs of improvement. Third party analysts and data sources confirm a steady rebound in revenue.

Wall Street Analysts Predict a Significant Improvement in AHTs Revenue.

If There Truly Is a Liquidity Crisis at AHT, the Independent Directors Should Immediately Do the Following:

How Is AINC Flush But AHT Is Insolvent?

Many Alternatives Exist to Create Value for Common and Preferred Stockholders

Cygnus Capital urges AHT common stockholders to vote AGAINST all proposals at AHT’s special meeting of stockholder to prevent the consummation of AHT’s exchange offers which will dilute common stockholders by ~94% dilution.

If you have already voted For the special meeting proposals, you have every legal right to change your vote. Vote AGAINST all special meeting proposals today!

About Cygnus Capital, Inc.

Cygnus Capital, Inc. is an integrated real estate investment and alternative asset management company focused on opportunistic, special situation, and distressed real estate investments. Cygnus targets long term, absolute returns for investors by applying a differentiated approach to real estate investing. By placing an emphasis on the acquisition, workout, and disposition of real estate debt assets characterized by their complexity, inefficiency, and niche qualities, Cygnus Capital is able to target superior, absolute returns for its investors. Cygnus Capital and its affiliates own approximately 1.9% of the outstanding shares of the Series D Preferred Stock, 2.4% of the outstanding shares of the Series F Preferred Stock, 2.4% of the outstanding shares of the Series G Preferred Stock, 4.8% of the outstanding shares of the Series H Preferred Stock, and 2.4% of the outstanding shares of the Series I Preferred Stock.

* * *

Written materials are submitted voluntarily pursuant to Rule 14a-6(g)(1) promulgated under the Securities Exchange Act of 1934. This is not a solicitation of authority to vote your proxy. Cygnus Capital is not asking for your proxy card and will not accept proxy cards if sent. The cost of this filing is being borne entirely by Cygnus Capital and its affiliates.

PLEASE NOTE: Cygnus Capital is not asking for your proxy card and cannot accept your proxy card. Please DO NOT send us your proxy card.

Source:

Christopher Swann

CEO, Cygnus Capital, Inc 

cswann@cygnuscapital.com

(404) 465-3685