Related Party Transactions

3 Months Ended

Mar. 31, 2016

Ashford LLC, a subsidiary of Ashford Inc., acts as our advisor, and as a result, we pay advisory fees to Ashford LLC. We are required to pay Ashford LLC a quarterly base fee that is a percentage of our total market capitalization on a declining sliding scale, subject to a minimum quarterly base fee, as payment for managing our day-to-day operations in accordance with our investment guidelines. We are also required to pay Ashford LLC an incentive fee that is based on our total return performance as compared to our peer group as well as to reimburse Ashford LLC for certain reimbursable overhead and internal audit, insurance claims advisory and asset management services, as specified in the advisory agreement. We also record equity-based compensation expense for equity grants of common stock and LTIP units awarded to our officers and employees of Ashford LLC in connection with providing advisory services equal to the fair value of the award in proportion to the requisite service period satisfied during the period.

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



	Three Months Ended March 31,
	2016			2015
Advisory services fee
Base advisory fee	$	2,025		$	2,205
Reimbursable expenses ⁽¹⁾	652			546
Equity-based compensation ⁽²⁾	(613		)	469
	$	2,064		$	3,220

________


⁽¹⁾	Reimbursable expenses include overhead, internal audit, insurance claims advisory and asset management services.


⁽²⁾	Equity-based compensation is associated with equity grants of Ashford Prime’s common stock and Long-Term Incentive Plan (“LTIP”) units awarded to officers and employees of Ashford LLC.

At March 31, 2016 and December 31, 2015, the balance in due to Ashford Trust OP, net, which is associated with reimbursable expenses, was $13,000 and $528,000, respectively. At March 31, 2016 and December 31, 2015, the balance in due to Ashford Inc., which is associated with the advisory services fee, was $5.3 million and $6.4 million, respectively.

- Definition

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

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