In 2012, the Company entered into the following term debt arrangements:
- On January 12, 2012, the Company entered into a loan with Empire Financial in connection with the Atlanta, GA Courtyard acquisition. The principal loan amount was $19.0 million and the maturity date is February 1, 2017. The loan bears interest at a fixed rate of 6.00% per year.
- On February 13, 2012, the Company consolidated and refinanced four loans with ING Life Insurance and Annuity Company into a single term loan of $67.5 million and the maturity date is March 1, 2032. The loan bears interest at a fixed rate of 6.10%. This loan is callable by the lender beginning March 1, 2019.
- On February 14, 2012, the Company refinanced a loan with Metabank of $7.0 million with a maturity date of February 1, 2017. The loan bears interest at a fixed rate of 4.95% per year.
- On March 2, 2012, the Company obtained two term loans from General Electric Capital Corporation in connection with the two Birmingham, AL acquisitions. The loan amounts were $5.6 million and $6.5 million, with both loans having a maturity date of April 1, 2017, and bear a fixed interest rate of 5.46% per year.
- On April 4, 2012, the Company refinanced two loans with GE Capital Financial, Inc. formerly financed with National Western Life Insurance; mortgage loans associated with the Scottsdale, AZ Courtyard and the Scottsdale, AZ Springhill Suites with loan amounts of $9.8 and $5.3 million, respectively. Both new loans bear interest at a fixed rate of 6.03% and have a maturity date of May 1, 2017. The transaction resulted in an interest rate reduction of 197 basis points as compared to the previous loan’s interest rate and $1.5 million of net proceeds from the refinancing after repaying the two previous loans including a prepayment penalty of $0.5 million.
- On June 24, 2012, the Company refinanced a loan with Chambers Bank of $1.5 million, which bears interest at a fixed rate of 6.50%, and a maturity date of June 24, 2014.
- On June 29, 2012, the Company refinanced a loan with Bank of the Ozarks of $8.9 million which resulted in $2.5 million of net proceeds after exercising the earn-out provision on the loan. In addition, the revised maturity date on the loan is July 10, 2017. Lastly, the interest rate was fixed at 5.75% for years 1-3 and will reset annually at LIBOR plus 375 basis points with a floor of 5.50% in years 4-5.