FelCor LP's Consolidating Financial Information | FelCor LP's Consolidating Financial Information Certain of FelCor LP's 100% owned subsidiaries (FCH/PSH, L.P.; FelCor/CMB Buckhead Hotel, L.L.C.; FelCor/CMB Marlborough Hotel, L.L.C.; FelCor/CMB Orsouth Holdings, L.P.; FelCor/CMB SSF Holdings, L.P.; FelCor/CSS Holdings, L.P.; FelCor Dallas Love Field Owner, L.L.C.; FelCor Milpitas Owner, L.L.C.; FelCor TRS Borrower 4, L.L.C.; FelCor Hotel Asset Company, L.L.C.; FelCor St. Pete (SPE), L.L.C.; FelCor Esmeralda (SPE), L.L.C.; FelCor S-4 Hotels (SPE), L.L.C.; Madison 237 Hotel, L.L.C.; Myrtle Beach Owner, L.L.C.; and Royalton 44 Hotel, L.L.C., collectively the “Subsidiary Guarantors”), together with Rangers, guaranty, fully and unconditionally, except where subject to customary release provisions as described below, and jointly and severally, our senior notes debt. The guaranties by the Subsidiary Guarantors may be automatically and unconditionally released upon (i) the sale or other disposition of all of the capital stock of the Subsidiary Guarantor or the sale or disposition of all or substantially all of the assets of the Subsidiary Guarantor, if, in each case, as a result of such sale or disposition, such Subsidiary Guarantor ceases to be a subsidiary of FelCor LP, (ii) the consolidation or merger of any such Subsidiary Guarantor with any person other than FelCor LP, or a subsidiary of FelCor LP, if, as a result of such consolidation or merger, such Subsidiary Guarantor ceases to be a subsidiary of the Operating Partnership, (iii) a legal defeasance or covenant defeasance of the indenture, (iv) the unconditional and complete release of such Subsidiary Guarantor in accordance with the modification and waiver provisions of the indenture, or (v) the designation of a restricted subsidiary that is a Subsidiary Guarantor as an unrestricted subsidiary under and in compliance with the indenture. For the Predecessor period, FelCor TRS was a subsidiary guarantor in the condensed consolidating balance sheet, the condensed consolidating statements of operations and comprehensive income, and the condensed consolidating statements of cash flows. Pursuant to the terms of each of the indentures governing the Senior Notes, upon completion of the distribution of the equity interests in FelCor TRS, FelCor TRS' guarantee of the Senior Notes was automatically released and FelCor TRS Holdings, L.L.C. ceased being a subsidiary guarantor of the Senior Notes. Accordingly, FelCor TRS is not a subsidiary guarantor in the FelCor LP consolidating financial information for the Company. The following tables present the consolidating financial information for the Subsidiary Guarantors: FelCor Lodging Limited Partnership Condensed Consolidating Balance Sheet December 31, 2019 (in thousands) FelCor LP Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Total Consolidated Equity investment in consolidated entities $ 1,722,133 $ — $ — $ (1,722,133 ) $ — Investment in hotel properties, net — 571,769 1,375,057 — 1,946,826 Investment in unconsolidated joint ventures 15,171 — — — 15,171 Cash and cash equivalents 1,985 — 17,587 — 19,572 Restricted cash reserves 447 — 3,700 — 4,147 Related party receivable 1,360 15,217 32,604 — 49,181 Lease right-of-use assets 4,444 66,571 9,620 — 80,635 Prepaid expense and other assets 1,748 1,888 3,907 — 7,543 Total assets $ 1,747,288 $ 655,445 $ 1,442,475 $ (1,722,133 ) $ 2,123,075 Debt, net $ 500,484 $ 24,711 $ 221,241 $ (32,709 ) $ 713,727 Related party debt — — 85,000 — 85,000 Accounts payable and other liabilities 7,449 15,017 10,210 — 32,676 Lease liabilities 4,661 25,571 17,968 — 48,200 Accrued interest 2,463 — — — 2,463 Related party accrued interest — — 190 — 190 Total liabilities 515,057 65,299 334,609 (32,709 ) 882,256 Partnership interests 1,232,231 590,146 1,099,278 (1,689,424 ) 1,232,231 Total partners' capital, excluding noncontrolling interest 1,232,231 590,146 1,099,278 (1,689,424 ) 1,232,231 Noncontrolling interest in consolidated joint ventures — — 8,588 — 8,588 Total partners’ capital 1,232,231 590,146 1,107,866 (1,689,424 ) 1,240,819 Total liabilities and partners’ capital $ 1,747,288 $ 655,445 $ 1,442,475 $ (1,722,133 ) $ 2,123,075 FelCor Lodging Limited Partnership Condensed Consolidating Balance Sheet December 31, 2018 (in thousands) FelCor LP Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Total Consolidated Equity investment in consolidated entities $ 1,913,418 $ — $ — $ (1,913,418 ) $ — Investment in hotel properties, net — 656,570 1,466,853 — 2,123,423 Investment in unconsolidated joint ventures 15,716 — — — 15,716 Cash and cash equivalents 10,778 — 10,573 — 21,351 Restricted cash reserves 441 — 2,770 — 3,211 Related party receivable — 3,666 12,835 — 16,501 Intangible assets, net — 46,260 — — 46,260 Prepaid expense and other assets 1,819 1,297 3,436 — 6,552 Related party prepaid interest — — 180 — 180 Total assets $ 1,942,172 $ 707,793 $ 1,496,647 $ (1,913,418 ) $ 2,233,194 Debt, net $ 505,322 $ — $ 154,015 $ (32,709 ) $ 626,628 Related party debt — — 85,000 — 85,000 Accounts payable and other liabilities 9,288 14,376 19,725 — 43,389 Accrued interest 2,463 — — — 2,463 Distributions payable — — 126 — 126 Total liabilities 517,073 14,376 258,866 (32,709 ) 757,606 Partnership interests 1,425,099 693,417 1,187,292 (1,880,709 ) 1,425,099 Total partners' capital, excluding noncontrolling interest 1,425,099 693,417 1,187,292 (1,880,709 ) 1,425,099 Noncontrolling interest in consolidated joint ventures — — 6,059 — 6,059 Preferred capital in a consolidated joint venture — — 44,430 — 44,430 Total partners’ capital 1,425,099 693,417 1,237,781 (1,880,709 ) 1,475,588 Total liabilities and partners’ capital $ 1,942,172 $ 707,793 $ 1,496,647 $ (1,913,418 ) $ 2,233,194 FelCor Lodging Limited Partnership Condensed Consolidating Statement of Operations and Comprehensive Income For the Year Ended December 31, 2019 (Successor) (in thousands) FelCor LP Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Total Consolidated Revenues Related party lease revenue $ — $ 74,621 $ 122,074 $ — $ 196,695 Total revenues — 74,621 122,074 — 196,695 Expenses Depreciation and amortization 512 26,832 45,045 — 72,389 Property tax, insurance and other (24 ) 19,367 21,622 — 40,965 General and administrative 1,066 159 64 — 1,289 Transaction costs 164 — 77 — 241 Total operating expenses 1,718 46,358 66,808 — 114,884 Other income 39 10 10 — 59 Interest income 898 — 232 (783 ) 347 Interest expense (23,793 ) (765 ) (8,155 ) 783 (31,930 ) Related party interest expense — — (4,529 ) — (4,529 ) Loss on sale of hotel properties, net — (10,638 ) (10,813 ) — (21,451 ) Income before equity in income from unconsolidated joint ventures (24,574 ) 16,870 32,011 — 24,307 Equity in income from consolidated entities 47,294 — — (47,294 ) — Equity in income from unconsolidated joint ventures 816 — — — 816 Net income and comprehensive income 23,536 16,870 32,011 (47,294 ) 25,123 Noncontrolling interest in consolidated joint ventures — — (248 ) — (248 ) Preferred distributions - consolidated joint venture — — (186 ) — (186 ) Redemption of preferred capital - consolidated joint venture — — (1,153 ) — (1,153 ) Net income and comprehensive income attributable to FelCor LP $ 23,536 $ 16,870 $ 30,424 $ (47,294 ) $ 23,536 FelCor Lodging Limited Partnership Condensed Consolidating Statement of Operations and Comprehensive Income For the Year Ended December 31, 2018 (Successor) (in thousands) FelCor LP Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Total Consolidated Revenues Related party lease revenue $ — $ 87,898 $ 129,699 $ — $ 217,597 Total revenues — 87,898 129,699 — 217,597 Expenses Depreciation and amortization 458 31,806 46,227 — 78,491 Property tax, insurance and other 134 27,948 25,672 — 53,754 General and administrative 840 117 99 — 1,056 Transaction costs 2,039 8 139 — 2,186 Total operating expenses 3,471 59,879 72,137 — 135,487 Other income 10 — 103 — 113 Interest income 805 — 84 (578 ) 311 Interest expense (28,428 ) — (10,080 ) 578 (37,930 ) Related party interest expense — — (708 ) — (708 ) Gain on sale of hotel properties, net — (15,763 ) 34,186 — 18,423 Gain on extinguishment of indebtedness, net 12,931 — (1,665 ) — 11,266 Income before equity in income from unconsolidated joint ventures (18,153 ) 12,256 79,482 — 73,585 Equity in income from consolidated entities 90,096 — — (90,096 ) — Equity in income from unconsolidated joint ventures 1,395 — — — 1,395 Net income and comprehensive income 73,338 12,256 79,482 (90,096 ) 74,980 Noncontrolling interest in consolidated joint ventures — — (159 ) — (159 ) Preferred distributions - consolidated joint venture — — (1,483 ) — (1,483 ) Net income and comprehensive income attributable to FelCor LP $ 73,338 $ 12,256 $ 77,840 $ (90,096 ) $ 73,338 FelCor Lodging Limited Partnership Condensed Consolidating Statement of Operations and Comprehensive Income For the Period of September 1, 2017 through December 31, 2017 (Successor) (in thousands) FelCor LP Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Total Consolidated Revenues Related party lease revenue $ — $ 32,572 $ 48,687 $ — $ 81,259 Total revenues — 32,572 48,687 — 81,259 Expenses Depreciation and amortization 151 12,164 16,650 — 28,965 Property tax, insurance and other 25 8,800 8,237 — 17,062 General and administrative 904 59 56 — 1,019 Transaction costs 4,079 105 9 — 4,193 Total operating expenses 5,159 21,128 24,952 — 51,239 Interest income 113 — 1 (104 ) 10 Interest expense (15,918 ) — (3,456 ) 104 (19,270 ) Loss on sale of hotel properties — — (6,637 ) — (6,637 ) Income before equity in income from unconsolidated joint ventures (20,964 ) 11,444 13,643 — 4,123 Equity in income from consolidated entities 24,434 — — (24,434 ) — Equity in income from unconsolidated joint ventures 661 — — — 661 Net income and comprehensive income 4,131 11,444 13,643 (24,434 ) 4,784 Noncontrolling interest in consolidated joint ventures — — (157 ) — (157 ) Preferred distributions - consolidated joint venture — — (496 ) — (496 ) Net income and comprehensive income attributable to FelCor LP $ 4,131 $ 11,444 $ 12,990 $ (24,434 ) $ 4,131 FelCor Lodging Limited Partnership Condensed Consolidating Statement of Operations and Comprehensive Loss For the Period of January 1, 2017 through August 31, 2017 (Predecessor) (in thousands) FelCor LP Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Total Consolidated Revenues Room revenue $ — $ 425,682 $ — $ — $ 425,682 Food and beverage revenue — 90,572 — — 90,572 Related party lease revenue — — 84,509 (84,509 ) — Other revenue 41 34,883 337 — 35,261 Total revenues 41 551,137 84,846 (84,509 ) 551,515 Expenses Room expense — 112,813 — — 112,813 Food and beverage expense — 71,828 — — 71,828 Management and franchise fee expense — 19,901 — — 19,901 Other operating expense — 147,827 — — 147,827 Total property operating expenses — 352,369 — — 352,369 Depreciation and amortization 309 28,064 44,692 — 73,065 Impairment loss — 35,109 — — 35,109 Property tax, insurance and other 921 111,020 16,846 (84,509 ) 44,278 General and administrative — 8,914 7,092 — 16,006 Transaction costs 68,248 — — — 68,248 Total operating expenses 69,478 535,476 68,630 (84,509 ) 589,075 Other income — — 100 — 100 Intercompany interest income (expense) 241 — (241 ) — — Interest income 66 59 1 — 126 Interest expense (38,722 ) — (12,968 ) — (51,690 ) Loss on sale of hotel properties, net 2 (1,565 ) (201 ) — (1,764 ) Loss on extinguishment of indebtedness — — (3,278 ) — (3,278 ) Loss before equity in income from unconsolidated joint ventures (107,850 ) 14,155 (371 ) — (94,066 ) Equity in income from consolidated entities 12,779 — — (12,779 ) — Equity in income from unconsolidated joint ventures 1,181 (77 ) (30 ) — 1,074 Loss before income tax expense (93,890 ) 14,078 (401 ) (12,779 ) (92,992 ) Income tax expense (35 ) (464 ) — — (499 ) Loss from continuing operations (93,925 ) 13,614 (401 ) (12,779 ) (93,491 ) Loss from discontinued operations (3,415 ) — — — (3,415 ) Net loss and comprehensive loss (97,340 ) 13,614 (401 ) (12,779 ) (96,906 ) Noncontrolling interest in consolidated joint ventures — 336 209 — 545 Preferred distributions - consolidated joint venture — — (979 ) — (979 ) Net loss and comprehensive loss attributable to FelCor LP (97,340 ) 13,950 (1,171 ) (12,779 ) (97,340 ) Preferred distributions (16,744 ) — — — (16,744 ) Net loss and comprehensive loss attributable to FelCor LP common unitholders $ (114,084 ) $ 13,950 $ (1,171 ) $ (12,779 ) $ (114,084 ) FelCor Lodging Limited Partnership Condensed Consolidating Statement of Cash Flows For the Year Ended December 31, 2019 (Successor) (in thousands) FelCor LP Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Total Consolidated Operating activities: Cash flows from operating activities $ (30,086 ) $ 46,685 $ 68,415 $ — $ 85,014 Investing activities: Proceeds from the sale of hotel properties, net — 81,943 62,504 — 144,447 Improvements and additions to hotel properties (162 ) (33,146 ) (28,707 ) — (62,015 ) Contributions to unconsolidated joint ventures (603 ) — — — (603 ) Intercompany financing 238,580 — — (238,580 ) — Cash flows from investing activities 237,815 48,797 33,797 (238,580 ) 81,829 Financing activities: Proceeds from borrowings — 25,000 71,000 — 96,000 Repayments of borrowings (112 ) — (2,566 ) — (2,678 ) Contributions from partners 188,318 — — — 188,318 Distributions to partners (404,722 ) — — — (404,722 ) Payments of deferred financing costs — (340 ) (650 ) — (990 ) Contributions from consolidated joint venture partners — — 2,281 — 2,281 Preferred distributions - consolidated joint venture — — (312 ) — (312 ) Redemption of preferred capital - consolidated joint venture — — (45,583 ) — (45,583 ) Intercompany financing — (120,142 ) (118,438 ) 238,580 — Cash flows from financing activities (216,516 ) (95,482 ) (94,268 ) 238,580 (167,686 ) Net change in cash, cash equivalents, and restricted cash reserves (8,787 ) — 7,944 — (843 ) Cash, cash equivalents, and restricted cash reserves, beginning of year 11,219 — 13,343 — 24,562 Cash, cash equivalents, and restricted cash reserves, end of year $ 2,432 $ — $ 21,287 $ — $ 23,719 FelCor Lodging Limited Partnership Condensed Consolidating Statement of Cash Flows For the Year Ended December 31, 2018 (Successor) (in thousands) FelCor LP Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Total Consolidated Operating activities: Cash flows from operating activities $ (53,388 ) $ 93,671 $ 132,962 $ — $ 173,245 Investing activities: Proceeds from the sale of hotel properties, net — 178,170 267,117 — 445,287 Improvements and additions to hotel properties (4 ) (27,530 ) (46,850 ) — (74,384 ) Intercompany financing 560,256 — — (560,256 ) — Cash flows from investing activities 560,252 150,640 220,267 (560,256 ) 370,903 Financing activities: Proceeds from borrowings - related party — — 85,000 — 85,000 Repayments of borrowings (538,814 ) — (115,842 ) — (654,656 ) Contributions from partners 732,319 — — — 732,319 Distributions to partners (698,787 ) — — — (698,787 ) Payment of deferred financing costs — — (10 ) — (10 ) Preferred distributions - consolidated joint venture — — (1,483 ) — (1,483 ) Intercompany financing — (244,311 ) (315,945 ) 560,256 — Cash flows from financing activities (505,282 ) (244,311 ) (348,280 ) 560,256 (537,617 ) Net change in cash, cash equivalents, and restricted cash reserves 1,582 — 4,949 — 6,531 Cash, cash equivalents, and restricted cash reserves, beginning of year 9,637 — 8,394 — 18,031 Cash, cash equivalents, and restricted cash reserves, end of year $ 11,219 $ — $ 13,343 $ — $ 24,562 FelCor Lodging Limited Partnership Condensed Consolidating Statement of Cash Flows For the Period of September 1, 2017 through December 31, 2017 (Successor) (in thousands) FelCor LP Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Total Consolidated Operating activities: Cash flows from operating activities $ (44,202 ) $ (11,078 ) $ (16,872 ) $ — $ (72,152 ) Investing activities: Proceeds from the sale of hotel properties, net — — 165,893 — 165,893 Improvements and additions to hotel properties — (5,704 ) (17,933 ) — (23,637 ) Intercompany financing 108,590 — — (108,590 ) — Cash flows from investing activities 108,590 (5,704 ) 147,960 (108,590 ) 142,256 Financing activities: Repayments of borrowings (990 ) — (1,174 ) — (2,164 ) Contributions from partners 130,076 — — — 130,076 Distributions to partners (187,616 ) — — — (187,616 ) Distribution of FelCor TRS — (51,867 ) — — (51,867 ) Distributions to preferred unitholders (4,186 ) — — — (4,186 ) Payment of deferred financing costs — — (254 ) — (254 ) Preferred distributions - consolidated joint venture — — (496 ) — (496 ) Intercompany financing — 20,142 (128,732 ) 108,590 — Cash flows from financing activities (62,716 ) (31,725 ) (130,656 ) 108,590 (116,507 ) Net change in cash, cash equivalents, and restricted cash reserves 1,672 (48,507 ) 432 — (46,403 ) Cash, cash equivalents, and restricted cash reserves, beginning of period 7,965 48,507 7,962 — 64,434 Cash, cash equivalents, and restricted cash reserves, end of period $ 9,637 $ — $ 8,394 $ — $ 18,031 FelCor Lodging Limited Partnership Condensed Consolidating Statement of Cash Flows For the Period of January 1, 2017 through August 31, 2017 (Predecessor) (in thousands) FelCor LP Subsidiary Guarantors Non-Guarantor Subsidiaries Eliminations Total Consolidated Operating activities: Cash flows from operating activities $ (40,773 ) $ 85,899 $ 54,214 $ — $ 99,340 Investing activities: Proceeds from the sale of hotel properties, net (696 ) 74,281 (169 ) — 73,416 Improvements and additions to hotel properties 1 (16,727 ) (47,076 ) — (63,802 ) Distributions from unconsolidated joint ventures in excess of earnings 840 — — — 840 Intercompany financing 91,391 — — (91,391 ) — Cash flows from investing activities 91,536 57,554 (47,245 ) (91,391 ) 10,454 Financing activities: Proceeds from borrowings — — 66,000 — 66,000 Repayment of borrowings — — (121,691 ) — (121,691 ) Distributions to preferred unitholders (18,836 ) — — — (18,836 ) Distributions to common unitholders (30,926 ) — — — (30,926 ) Distributions to consolidated joint venture partners — — (150 ) — (150 ) Contributions from consolidated joint venture partners — 333 — — 333 Net proceeds from the issuance of preferred capital in a consolidated joint venture — — 647 — 647 Intercompany financing — (140,853 ) 49,462 91,391 — Other (6,568 ) — (977 ) — (7,545 ) Cash flows from financing activities (56,330 ) (140,520 ) (6,709 ) 91,391 (112,168 ) Net change in cash, cash equivalents, and restricted cash reserves (5,567 ) 2,933 260 — (2,374 ) Cash, cash equivalents, and restricted cash reserves, beginning of period 13,532 45,574 7,702 — 66,808 Cash, cash equivalents, and restricted cash reserves, end of period $ 7,965 $ 48,507 $ 7,962 $ — $ 64,434 |