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v3.21.1

Indebtedness, net | 3 Months Ended
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Mar. 31, 2021
Debt Disclosure [Abstract] |
Indebtedness, net | Indebtedness, net Indebtedness, net consisted of the following (dollars in thousands):
Indebtedness |  | Collateral |  | Current Maturity |  | Final Maturity (9) |  | Interest Rate |  | March 31, 2021 |  | December 31, 2020
Mortgage loan (3) |  | The Notary Hotel |  | June 2021 |  | June 2025 |  | LIBOR (1) + 2.16% |  | $ | 435,000 |  |  |  |  | $ | 435,000 |  |  |
|  | The Clancy |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Sofitel Chicago Magnificent Mile |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Marriott Seattle Waterfront |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mortgage loan (4) |  | The Ritz-Carlton St. Thomas |  | August 2021 |  | August 2024 |  | LIBOR (1) + 3.95% |  | 42,500 |  |  |  |  | 42,500 |  |  |
Mortgage loan (5) |  | Park Hyatt Beaver Creek Resort & Spa |  | April 2022 |  | April 2022 |  | LIBOR (1) + 2.75% |  | 67,500 |  |  |  |  | 67,500 |  |  |
Mortgage loan (7) |  | Hotel Yountville |  | May 2022 |  | May 2022 |  | LIBOR (1) + 2.55% |  | 51,000 |  |  |  |  | 51,000 |  |  |
Mortgage loan (7) |  | Bardessono Hotel and Spa |  | August 2022 |  | August 2022 |  | LIBOR (1) + 2.55% |  | 40,000 |  |  |  |  | 40,000 |  |  |
Term loan (6) |  | Equity |  | October 2022 |  | October 2022 |  | Base Rate (2) + 1.25% to 2.65% or LIBOR (1) + 2.25% to 3.65% |  | 51,221 |  |  |  |  | 61,495 |  |  |
Mortgage loan (7) |  | The Ritz-Carlton Sarasota |  | April 2023 |  | April 2023 |  | LIBOR (1) + 2.65% |  | 100,000 |  |  |  |  | 100,000 |  |  |
Mortgage loan (7) |  | The Ritz-Carlton Lake Tahoe |  | January 2024 |  | January 2024 |  | LIBOR (1) + 2.10% |  | 54,000 |  |  |  |  | 54,000 |  |  |
Mortgage loan (8) |  | Capital Hilton |  | February 2024 |  | February 2024 |  | LIBOR (1) + 1.70% |  | 196,671 |  |  |  |  | 197,229 |  |  |
|  | Hilton La Jolla Torrey Pines |  |  |  |  |  |  |  |  |  |  |  |  |  |
Mortgage loan (7) |  | Pier House Resort & Spa |  | September 2024 |  | September 2024 |  | LIBOR (1) + 1.85% |  | 80,000 |  |  |  |  | 80,000 |  |  |
|  |  |  |  |  |  |  |  |  | 1,117,892 |  |  |  |  | 1,128,724 |  |  |
Capitalized default interest and late charges |  |  |  |  |  |  |  |  |  | 5,994 |  |  |  |  | 7,304 |  |  |
Deferred loan costs, net |  |  |  |  |  |  |  |  |  | (5,062) |  |  |  |  | (5,434) |  |  |
Indebtedness, net |  |  |  |  |  |  |  |  |  | $ | 1,118,824 |  |  |  |  | $ | 1,130,594 |  |  |
__________________ (1)LIBOR rates were 0.111% and 0.144% at March 31, 2021 and December 31, 2020, respectively. (2)Base Rate, as defined in the secured term loan agreement, is the greater of (i) the prime rate set by Bank of America, or (ii) federal funds rate + 0.5%, or (iii) LIBOR + 1.0%. (3)This mortgage loan has five one-year extension options, subject to satisfaction of certain conditions, of which the first was exercised in June 2020. (4)This mortgage loan has three one-year extension options, subject to satisfaction of certain conditions. (5)Effective January 9, 2021, we amended this mortgage loan. Terms of the agreement included monthly FF&E escrow deposits being waived from January 2021 through June 2021. This mortgage loan has three one-year extension options, subject to satisfaction of certain conditions, of which the third was exercised in April 2021. (6)Effective February 22, 2021, we amended this term loan. In conjunction with the amendment, the interest rate spread increased from a rate of Base Rate + 1.25% - 2.50% or LIBOR + 2.25% - 3.50%, with Base Rate + 1.25% - 2.65% or LIBOR + 2.25% - 3.65%, with a LIBOR floor of 0.50%. (7)Effective December 31, 2020, we amended this mortgage loan. Terms of the agreement included monthly FF&E escrow deposits being waived from January 2021 through December 2021. (8)Effective March 5, 2021, we amended this mortgage loan. Terms of the agreement included monthly FF&E escrow deposits waived through July 1, 2021. (9)The final maturity date assumes all available extensions options will be exercised. On June 8, 2020, the Company entered into the First Amendment to the Second Amended and Restated Credit Agreement (the “Amendment”). The Amendment converted the $75 million Second Amended and Restated Credit Agreement, dated October 25, 2019 (the “Credit Facility”), which was a secured revolving credit facility, into a $65 million secured term loan. The Company had borrowed the full borrowing capacity of $75 million under the Credit Facility and repaid $10 million on June 8, 2020, in connection with the signing of the Amendment. The Amendment also added principal amortization of $5 million per quarter commencing on March 31, 2021. The Amendment changes the terms of certain financial covenants that the Company was subject to under the Credit Facility. The Amendment had the same maturity date of October 25, 2022 but removed the two one-year extension options and also removed the Company’s ability to reborrow amounts that have been repaid. On February 22, 2021, the Company entered into the Second Amendment to the Second Amended and Restated Credit Agreement. The amendment provides an extension of the waiver on the majority of the covenants through the fourth quarter of 2021 and a reduced fixed charge coverage ratio covenant through the end of 2022. The first period in which covenants will be tested is for the fiscal quarter ending March 31, 2022. The amendment also allows the Company to utilize approximately $9.3 million of cash held in FF&E reserve accounts at certain properties for discretionary capital expenditures. During the second and third quarters of 2020, we reached forbearance and other agreements with our lenders relating to loans secured by the Pier House Resort & Spa, The Ritz-Carlton Sarasota, The Ritz-Carlton Lake Tahoe, Hotel Yountville, Bardessono Hotel and Spa, Sofitel Chicago Magnificent Mile, The Notary Hotel, The Clancy, Marriott Seattle Waterfront, Capital Hilton and Hilton La Jolla Torrey Pines. As of March 31, 2021, no loans are in default. See note 14 for discussion of the loan modification agreement with Lismore Capital LLC (“Lismore”). The Company determined that all of the forbearance and other agreements evaluated were considered troubled debt restructurings due to terms that allowed for deferred interest and the forgiveness of default interest and late charges. No gain or loss was recognized during 2020, as the carrying amount of the original loans was not greater than the undiscounted cash flows of the modified loans. Additionally, as a result of the troubled debt restructurings all accrued default interest and late charges were capitalized into the applicable loan balances and are being amortized over the remaining term of the loans using the effective interest method. The amount of principal amortization associated with the default interest and late charges during three months ended March 31, 2021 was approximately $1.3 million. We are required to maintain certain financial ratios under our secured term loan. If we violate covenants in any debt agreement, we could be required to repay all or a portion of our indebtedness before maturity at a time when we might be unable to arrange financing for such repayment on attractive terms, if at all. The assets of certain of our subsidiaries are pledged under non-recourse indebtedness and are not available to satisfy the debts and other obligations of the consolidated group. As of March 31, 2021, we were in compliance with all covenants.

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