MORTGAGE AND OTHER INDEBTEDNESS, NET

Debt of the Company

CBL has no indebtedness. Either the Operating Partnership or one of its consolidated subsidiaries, that it has a direct or indirect ownership interest in, is the borrower on all of the Company's debt.

CBL is a limited guarantor of the Senior Unsecured Notes, as described below, for losses suffered solely by reason of fraud or willful misrepresentation by the Operating Partnership or its affiliates. The Company also provided a similar limited guarantee of the Operating Partnership's obligations with respect to its unsecured credit facilities and three unsecured term loans as of December 31, 2018.

Subsequent to December 31, 2018, the Company closed on a new secured credit facility that replaced its unsecured lines of credit and unsecured term loans. See Note 20 for additional information.

Debt of the Operating Partnership

Mortgage and other indebtedness consisted of the following:



	December 31, 2018				December 31, 2017
	Amount			Weighted-Average Interest Rate ⁽¹⁾	Amount			Weighted-Average Interest Rate ⁽¹⁾
Fixed-rate debt:
Non-recourse loans on operating Properties	$	1,783,097		5.33%	$	1,796,203		5.33%
Senior unsecured notes due 2023 ⁽²⁾	447,423			5.25%	446,976			5.25%
Senior unsecured notes due 2024 ⁽³⁾	299,953			4.60%	299,946			4.60%
Senior unsecured notes due 2026 ⁽⁴⁾	616,635			5.95%	615,848			5.95%
Total fixed-rate debt	3,147,108			5.37%	3,158,973			5.37%
Variable-rate debt:
Non-recourse loans on operating Properties	—			—%	10,836			3.37%
Recourse loans on operating Properties	68,607			4.97%	101,187			4.00%
Construction loan	8,172			5.25%	—			—%
Unsecured lines of credit ⁽⁵⁾	183,972			3.90%	93,787			2.56%
Unsecured term loans ⁽⁵⁾	695,000			4.21%	885,000			2.81%
Total variable-rate debt	955,751			4.21%	1,090,810			2.90%
Total fixed-rate and variable-rate debt	4,102,859			5.10%	4,249,783			4.74%
Unamortized deferred financing costs	(15,963		)		(18,938		)
Liabilities related to assets held for sale ⁽⁶⁾	(43,716		)		—
Total mortgage and other indebtedness, net	$	4,043,180			$	4,230,845


(1)	Weighted-average interest rate includes the effect of debt premiums and discounts, but excludes amortization of deferred financing costs.


(2)	The balance is net of an unamortized discount of $2,577 and $3,024, as of December 31, 2018 and 2017, respectively.


(3)	The balance is net of an unamortized discount of $47 and $54, as of December 31, 2018 and 2017, respectively.


(4)	The balance is net of an unamortized discount of $8,365 and $9,152 as of December 31, 2018 and 2017, respectively.


(5)	The Company closed on a new secured credit facility subsequent to December 31, 2018 that replaced its unsecured lines of credit and unsecured term loans. See Note 20 for additional information.


(6)	Represents a non-recourse mortgage loan secured by Cary Towne Center that is classified on the consolidated balance sheet as liabilities related to assets held for sale. The mall was sold subsequent to December 31, 2018. See Note 20 for more information.

Non-recourse and recourse term loans include loans that are secured by Properties owned by the Company that have a net carrying value of $1,779,565 at December 31, 2018.

Senior Unsecured Notes



Description	Issued ⁽¹⁾	Amount		Interest Rate ⁽²⁾	Maturity Date⁽³⁾
2023 Notes	November 2013	$	450,000	5.25%	December 2023
2024 Notes	October 2014	300,000		4.60%	October 2024
2026 Notes	December 2016 / September 2017 ⁽⁴⁾	625,000		5.95%	December 2026


(1)	Issued by the Operating Partnership. CBL is a limited guarantor of the Operating Partnership's obligations under the Notes as described above.

(2)

Interest is payable semiannually in arrears. The interest rate for the 2024 Notes and the 2023 Notes is subject to an increase ranging from 0.25% to 1.00% from time to time if, on or after January 1, 2016 and prior to January 1, 2020, the ratio of secured debt to total assets of the Company, as defined, is greater than 40% but less than 45%. The required ratio of secured debt to total assets for the 2026 Notes is 40% or less. As of December 31, 2018, this ratio was 24%.

(3)

The Notes are redeemable at the Operating Partnership's election, in whole or in part from time to time, on not less than 30 days and not more than 60 days' notice to the holders of the Notes to be redeemed. The 2026 Notes, the 2024 Notes and the 2023 Notes may be redeemed prior to September 15, 2026; July 15, 2024; and September 1, 2023, respectively, for cash at a redemption price equal to the aggregate principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but not including, the redemption date and a make-whole premium calculated in accordance with the indenture. On or after the redemption date, the Notes are redeemable for cash at a redemption price equal to the aggregate principal amount of the Notes to be redeemed plus accrued and unpaid interest. If redeemed prior to the respective dates noted above, each issuance of Notes is redeemable at the treasury rate plus 0.50%, 0.35% and 0.40% for the 2026 Notes, the 2024 Notes and the 2023 Notes, respectively.

(4)

On September 1, 2017, the Operating Partnership issued and sold an additional $225,000 of the 2026 Notes. Interest was payable with respect to the additional issuance on December 15, 2017. After deducting underwriting discounts and other offering expenses of $1,879 and a discount of $3,938, the net proceeds from the sale were approximately $219,183. The Operating Partnership used the net proceeds to reduce amounts outstanding under its unsecured credit facilities and for general business purposes.

Unsecured Lines of Credit

The Company had three unsecured credit facilities that were used for retirement of secured loans, repayment of term loans, working capital, construction and acquisition purposes, and issuances of letters of credit.

Each facility bore interest at LIBOR plus a spread of 0.875% to 1.550% based on credit ratings for the Operating Partnership's senior unsecured long-term indebtedness. As of December 31, 2018, the Operating Partnership's interest rate based on the credit ratings of its unsecured long-term indebtedness of Ba1 from Moody's Investors Service ("Moody's"), BB+ from Standard & Poor's Rating Services ("S&P") and BB- from Fitch Ratings ("Fitch"), was LIBOR plus 1.550%.

Additionally, the Company paid an annual facility fee on the full commitment that ranged from 0.125% to 0.300%, based on the credit ratings described above. As of December 31, 2018, the annual facility fee was 0.30%. The three unsecured lines of credit had a weighted-average interest rate of 3.90% at December 31, 2018.

The following summarizes certain information about the Company's unsecured lines of credit as of December 31, 2018:



	Total Capacity			Total Outstanding			Maturity Date	Extended Maturity Date
Wells Fargo - Facility A	$	500,000	⁽¹⁾	$	—		October 2019	October 2020	⁽²⁾
First Tennessee	100,000		⁽³⁾	51,896			October 2019	October 2020	⁽⁴⁾
Wells Fargo - Facility B	500,000		⁽¹⁾	132,076		⁽⁵⁾	October 2020
	$	1,100,000		$	183,972


(1)	Up to $30,000 of the capacity on this facility could be used for letters of credit.


(2)	The extension option on the facility was at the Company's election, subject to continued compliance with the terms of the facility, and had a one-time extension fee of 0.15% of the commitment amount of the credit facility.


(3)	Up to $20,000 of the capacity on this facility could be used for letters of credit.


(4)	The extension option on the facility was at the Company's election, subject to continued compliance with the terms of the facility, and had a one-time extension fee of 0.20% of the commitment amount of the credit facility.


(5)	There was $4,833 outstanding on this facility as of December 31, 2018 for letters of credit.

Subsequent to December 31, 2018, the unsecured lines of credit were replaced with a secured line of credit. See Note 20.

Unsecured Term Loans

The following summarizes certain information about the Company's unsecured term loans as of December 31, 2018:

Total

Outstanding

Interest Rate Spread

Interest

Rate

Maturity

Date

Extended

Maturity

Date

Wells Fargo - $350,000 term loan

350,000

LIBOR + 1.75%

4.10%

October 2019

⁽¹⁾

Wells Fargo - $300,000 term loan

300,000

LIBOR + 2.00%

4.35%

July 2020

July 2022

⁽²⁾

First Tennessee - $45,000 term loan

45,000

LIBOR + 1.65%

4.17%

June 2021

June 2022

695,000


(1)	In October 2018, the Company exercised its option to extend the maturity date to October 2019.


(2)	The loan had two one-year extension options, the second of which was at the lender's discretion.

Subsequent to December 31, 2018, the Company's unsecured term loans were replaced with a new secured term loan. See Note 20 for more information.

Fixed-Rate Debt

As of December 31, 2018, fixed-rate loans on operating Properties bear interest at stated rates ranging from 4.00% to 8.00%. Fixed-rate loans on operating Properties generally provide for monthly payments of principal and/or interest and mature at various dates through October 2028, with a weighted-average maturity of 3.0 years.

2018 Financings

The following table presents the fixed-rate loans secured by the related consolidated Properties that were entered into in 2018:



Date	Property	Stated Interest Rate	Maturity Date	Amount Financedor Extended
August	Hickory Point Mall ⁽¹⁾	5.85%	December 2019	$	27,446
September	The Outlet Shoppes at El Paso ⁽²⁾	5.10%	October 2028	75,000
				$	102,446


(1)	The Company exercised the extension option under the mortgage loan.


(2)	The Company owns the property in a 75/25 consolidated joint venture. A portion of the proceeds from the non-recourse loan was used to retire a recourse loan secured by Phase II of The Outlet Shoppes at El Paso as described below.

Loan Repayments

The Company repaid the following fixed-rate loans, secured by the related consolidated Properties, in 2018 and 2017:



Date	Property	Interest Rate at Repayment Date	Scheduled Maturity Date	Principal Balance Repaid ⁽¹⁾
2018:
January	Kirkwood Mall	5.75%	April 2018	$	37,295



Date	Property	Interest Rate at Repayment Date	Scheduled Maturity Date	Principal Balance Repaid ⁽¹⁾
2017:
January	The Plaza at Fayette	5.67%	April 2017	$	37,146
January	The Shoppes at St. Clair Square	5.67%	April 2017	18,827
February	Hamilton Corner	5.67%	April 2017	14,227
March	Layton Hills Mall	5.66%	April 2017	89,526
April	The Outlet Shoppes at Oklahoma City ⁽²⁾	5.73%	January 2022	53,386
April	The Outlet Shoppes at Oklahoma City - Phase II ⁽²⁾	3.53%	April 2019	5,545
April	The Outlet Shoppes at Oklahoma City - Phase III ⁽²⁾	3.53%	April 2019	2,704
September	Hanes Mall ⁽³⁾	6.99%	October 2018	144,325
September	The Outlet Shoppes at El Paso	7.06%	December 2017	61,561
				$	427,247


(1)	The Company retired the loans with borrowings from its credit facilities unless otherwise noted.


(2)	The loan was retired in conjunction with the sale of the Property which secured the loan. The Company recorded an $8,500 loss on extinguishment of debt due to a prepayment fee on the early retirement. See Note 5 for more information.


(3)	The Company recorded a $371 loss on extinguishment of debt due to a prepayment fee on the early retirement.

The following is a summary of the Company's 2017 dispositions for which the title to the consolidated mall securing the related fixed-rate debt was transferred to the lender in satisfaction of the non-recourse debt:



Date	Property	Interest Rate at Repayment Date	Scheduled Maturity Date	Balance of Non-recourse Debt		Gain on Extinguishment of Debt
January	Midland Mall	6.10%	August 2016	$	31,953	$	3,760
June	Chesterfield Mall	5.74%	September 2016	140,000		29,187
August	Wausau Center	5.85%	April 2021	17,689		6,851
				$	189,642	$	39,798

Other

On June 4, 2018, the $43,716 interest-only non-recourse loan that was secured by Cary Towne Center matured and was in default as of December 31, 2018. In August 2018, the Company and the lender executed a forbearance agreement. See Note 16 for more information on the loss and impairment of real estate that the Company recorded in June 2018. Subsequent to December 31, 2018, the mall was sold. See Note 20 for more information.

In conjunction with the divestiture of the Company's interests in a consolidated joint venture, the Company was relieved of its funding obligation related to the loan secured by vacant land owned by the joint venture, which had a principal balance of $2,466 upon the disposition of its interests in 2017. See Note 13 and Note 16 for more information.

Variable-Rate Debt

Term loans for the Company’s operating Properties bear interest at variable interest rates indexed to LIBOR. At December 31, 2018, interest rates on such variable-rate loans varied from 4.85% to 5.00%. These loans mature at various dates from May 2019 to July 2020, with a weighted-average maturity of 0.6 years, and have extension options of up to two years.

2018 Loan Repayments

The Company repaid the following variable-rate loans, secured by the related consolidated properties in 2018:



Date	Property	Interest Rate at Repayment Date	Scheduled Maturity Date	Principal Balance Repaid ⁽¹⁾
August	Statesboro Crossing ⁽²⁾	4.24%	June 2019	$	10,753
September	The Outlet Shoppes at El Paso - Phase II ⁽³⁾	4.73%	December 2018	6,525
				$	17,278


(1)	The Company retired the loans with borrowings from its credit facilities unless otherwise noted.


(2)	The loan was retired in conjunction with the sale of the property that secured the loan. See Note 5 for more information.


(3)	The loan secured by the Property was retired when the joint venture closed on a new fixed-rate loan in September 2018 as described above.

2017 Financing

The following table presents the variable-rate loan, secured by the related consolidated Property, that was extended in 2017:



Date	Property	Stated Interest Rate	Maturity Date	Amount Extended
March	Statesboro Crossing ⁽¹⁾	LIBOR + 1.80%	June 2018	$	10,930


(1)	The Company exercised the extension option under the mortgage loan. The loan was retired in conjunction with the sale of the property as described above.

2018 Construction Loan

Financing

The following table presents the construction loan, secured by the related consolidated Property, that was entered into in 2018:



Date	Property	Stated Interest Rate	Maturity Date		Total Borrowing Capacity
October	Brookfield Square Anchor Redevelopment	LIBOR + 2.9%	October 2021	⁽¹⁾	$	29,400


(1)	The loan has one 12-month extension option for an outside maturity date of October 2022.

Financial Covenants and Restrictions

The agreements for the unsecured lines of credit, the Notes and unsecured term loans contain, among other restrictions, certain financial covenants including the maintenance of certain financial coverage ratios, minimum unencumbered asset and interest ratios, maximum secured indebtedness ratios, maximum total indebtedness ratios and limitations on cash flow distributions. The agreements for the Notes described above contain default provisions customary for transactions of this nature (with applicable customary grace periods). Additionally, any default in the payment of any recourse indebtedness greater than or equal to $50,000 of the Operating Partnership will constitute an event of default under the Notes. The Company believes that it was in compliance with all financial covenants and restrictions at December 31, 2018.

Subsequent to December 31, 2018, the Company entered into a senior secured credit facility that replaced its unsecured lines of credit and unsecured term loans. The senior secured credit facility contains, among other restrictions, various restrictive covenants that are defined and computed on the same basis as the covenants required under the Notes. See Note 20 for more information on this financing.

Other

Several of the Company’s Properties are owned by special purpose entities, created as a requirement under certain loan agreements that are included in the Company’s consolidated financial statements. The sole business purpose of the special purpose entities is to own and operate these Properties. The real estate and other assets owned by these special purpose entities are restricted under the loan agreements in that they are not available to settle other debts of the Company. However, so long as the loans are not under an event of default, as defined in the loan agreements, the cash flows from these Properties, after payments of debt service, operating expenses and reserves, are available for distribution to the Company.

Scheduled Principal Payments

As of December 31, 2018, the scheduled principal amortization and balloon payments of the Company’s consolidated debt, excluding extensions available at the Company’s option, on all mortgage and other indebtedness, including construction loans and lines of credit, are as follows:



2019	$	664,093
2020	640,330
2021	507,582
2022	432,638
2023	522,905
Thereafter	1,182,824
	3,950,372
Net unamortized discounts and premium	(10,989		)
Unamortized deferred financing costs	(15,963		)
Principal balance of loan secured by Lender Malls in foreclosure ⁽¹⁾	163,476
Liabilities related to assets held for sale	(43,716		)
Total mortgage and other indebtedness, net	$	4,043,180

(1)

Represents the aggregate principal balance as of December 31, 2018 of two non-recourse loans, secured by Acadiana Mall, which was in receivership, and Cary Towne Center, which was in default. The loan secured by Acadiana Mall and Cary Towne Center matured in April 2017 and June 2018, respectively. Subsequent to December 31, 2018, Acadiana Mall was transferred to the lender through a deed-in-lieu of foreclosure, and the lender received the sales proceeds from Cary Towne Center. See Note 20 for more information.

Of the $664,093 of scheduled principal payments in 2019, $220,031 relates to the maturing principal balances of six operating Property loans, $350,000 represented the principal balance of one unsecured term loan, $51,896 represented the principal balance of one unsecured line of credit and $42,166 relates to scheduled principal amortization. Of the 2019 maturities, one operating Property loan with a principal balance of $68,101 has a one-year extension option, one Operating Property loan with a principal balance of $54,550 has one two-year extension option and the $51,896 unsecured line of credit and $350,000 unsecured term loan were replaced with a secured line of credit and term loan subsequent to December 31, 2018 (see Note 20), leaving approximately $97,380 of loan maturities in 2019 that must be retired or refinanced.

Additionally, subject to the need to maintain compliance with all applicable debt covenants, the Operating Partnership, or any affiliate of the Operating Partnership, may at any time, or from time to time, repurchase outstanding Notes in the open market or otherwise. Such Notes may, at the option of the Operating Partnership or the relevant affiliate of the Operating Partnership, be held, resold or surrendered to the Trustee for cancellation.