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Debt (Tables)
 9 Months Ended
Sep. 07, 2012
Debt Disclosure [Abstract]  
Summary of long term debt
The following table sets forth information regarding the Company’s debt as of September 7, 2012 (unaudited), in thousands:
Property
 
Principal
Balance
 
Interest Rate
 
 
 
 
 
Courtyard Manhattan / Midtown East
 
$
42,029

 
8.81%
Marriott Salt Lake City Downtown
 
29,173

 
5.50%
Courtyard Manhattan / Fifth Avenue
 
50,355

 
6.48%
Renaissance Worthington
 
54,985

 
5.40%
Frenchman’s Reef & Morning Star Marriott Beach Resort
 
59,014

 
5.44%
Marriott Los Angeles Airport
 
82,600

 
5.30%
Orlando Airport Marriott
 
57,838

 
5.68%
Chicago Marriott Downtown Magnificent Mile
 
212,445

 
5.975%
Hilton Minneapolis
 
97,547

 
5.464%
JW Marriott Denver at Cherry Creek
 
41,103

 
6.47%
Lexington Hotel New York
 
170,368

 
LIBOR + 3.00% (3.23% at September 7, 2012)
Debt premium
 
1,014

 
 
Total mortgage debt
 
898,471

 
 
 
 
 
 
 
Senior unsecured credit facility
 
120,000

 
LIBOR + 2.50% (2.75% at September 7, 2012)
Total debt
 
$
1,018,471

 
 
Weighted-Average Interest Rate
 
 
 
5.17%
Summary of applicable margin based upon the Company’s ratio of net indebtedness to EBITDA
The applicable margin is based upon the Company’s ratio of net indebtedness to EBITDA, as follows:

Ratio of Net Indebtedness to EBITDA
 
Applicable Margin
Less than 4.00 to 1.00
 
2.25
%
Greater than or equal to 4.00 to 1.00 but less than 5.00 to 1.00
 
2.50
%
Greater than or equal to 5.00 to 1.00 but less than 5.50 to 1.00
 
2.75
%
Greater than or equal to 5.50 to 1.00 but less than 6.00 to 1.00
 
3.00
%
Greater than or equal to 6.00 to 1.00
 
3.25
%
Summary of the most restrictive covenants for senior unsecured credit facility
The facility contains various corporate financial covenants. A summary of the most restrictive covenants is as follows:
 
 
 
Actual at
 
Covenant
 
September 7,
2012
Maximum leverage ratio (1)
60%
 
49.6%
Minimum fixed charge coverage ratio (2)
1.50x
 
2.23x
Minimum tangible net worth (3)
$2.0 billion
 
$2.2 billion
Secured recourse indebtedness
$25 million
 
$25 million
_____________________________
(1)
Leverage ratio is total indebtedness, as defined in the credit agreement which includes our commitment on the Times Square development hotel, divided by total asset value, defined in the credit agreement as a) total cash and cash equivalents plus b) the value of our owned hotels based on hotel net operating income divided by an 8.5% capitalization rate, and (c) the book value of the Allerton loan.
(2)
Fixed charge coverage ratio is Adjusted EBITDA, defined in the credit agreement as EBITDA less FF&E reserves, for the most recently ending 12 fiscal months, to fixed charges, defined in the credit agreement as interest expense, all regularly scheduled principal payments and payments on capitalized lease obligations, for the same most recently ending 12 fiscal month period.
(3)
Tangible net worth, as defined in the credit agreement, is (i) total gross book value of all assets, exclusive of depreciation and amortization, less intangible assets, total indebtedness, and all other liabilities, plus (ii) 85% of net proceeds from future equity issuances