UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 9, 2021
LODGING FUND REIT III, INC.
(Exact Name of Registrant as Specified in Charter)
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Maryland | 000-56082 | 83-0556111 |
(State or Other Jurisdiction of | (Commission File Number) | (IRS Employer |
1635 43rd Street South, Suite 205 | |
Fargo, North Dakota | 58103 |
(Address of Principal Executive Offices) | (Zip Code) |
Registrant’s telephone number, including area code: (701) 630-6500
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Securities registered or to be registered pursuant to Section 12(b) of the Act.
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
None | N/A | N/A |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
◻ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
◻ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
◻ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
◻ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
On April 9, 2021, the Company, through LF3 Southaven TRS, LLC (“Southaven TRS”) which is a subsidiary of the Company’s operating partnership subsidiary, Lodging Fund REIT III OP, LP, entered into an unsecured promissory note under the Second Draw Paycheck Protection Program (the “Second Draw PPP”) created by the Consolidated Appropriations Act, 2021 (the “CAA Act”), through Western State Bank (the “Lender”). The term of the Second Draw PPP loan is five years. The amount of the Second Draw PPP loan is $119,500. The interest rate on the Second Draw PPP loan is 1.0% per annum, which shall be deferred for the first sixteen months of the term of the loan. After the initial sixteen-month deferral period, the loan requires monthly payments of principal and interest until maturity with respect to any portion of the loan which is not forgiven as described below. The Company is permitted to prepay the Second Draw PPP loan at any time with no prepayment penalties.
Under the terms of the CAA Act, Second Draw PPP loan recipients can apply for, and be granted, forgiveness for all or a portion of such loans. Such forgiveness will be determined, subject to limitations and ongoing rulemaking by the SBA, based on the use of loan proceeds for payroll costs and mortgage interest, rent or utility costs, the maintenance of employee and compensation levels and certain other approved expenses. No assurance is provided that the Company will obtain forgiveness of the Second Draw PPP loan in whole or in part.
ITEM 2.03 CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT
The information in this Report set forth under Item 1.01 is incorporated herein by reference.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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| | LODGING FUND REIT III, INC. | |
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Dated: August 12, 2021 | | BY: | /s/ Corey R. Maple |
| | | Corey R. Maple |
| | | Chairman of the Board, Chief Executive Officer and Secretary |