Host Hotels & Resorts Successfully Extends Credit Facility Waiver Period and Increases Financial Flexibility and Optionality
02/10/2021
Key terms of the second amendment to the credit agreement include:
- Continued waiver of all quarterly-tested financial covenants through the first quarter of 2022, with testing resuming for the second quarter of 2022 (the “first test period”);
- For the first test period, only the fixed charge coverage ratio covenant is tested with a minimum requirement of 1.0x; all other covenants are waived until the quarter ending
September 30, 2022 ;
- Modification of leverage covenant to ease compliance for the first five quarters following the first test period, with maximum leverage thresholds by quarter listed below;
- 8.5x for the quarters ending
September 30 andDecember 31 of 2022 - 8.0x for the quarters ending
March 31 andJune 30 of 2023 - 7.50x for the quarter ending
September 30, 2023 - 7.25x thereafter
- 8.5x for the quarters ending
- Ability to retain
$500 million from asset sales for the purpose of reinvesting in acquisitions unencumbered by debt in addition to the prior ability to reinvest$750 million of net sale proceeds through the like-kind-exchange exchange process;
- Permission to acquire assets up to
$2.0 billion with existing liquidity and the above-mentioned asset sales as long as the Company maintains total minimum liquidity of$600 million ; and
- Ability to fund
$450 million in ROI capital expenditures during the extended covenant relief period in addition to any unused amount of the$500 million capacity under the first amendment, as well as to complete capital expenditures incurred in connection with emergency repairs, life safety repairs or ordinary course maintenance repairs.
Notably, the Company did not incur any increases in pricing through this amendment. In addition, the Company also continued to preserve the fully unsecured status of its 80 consolidated assets.
For additional information on the terms of the second amendment to the credit agreement, please refer to the presentation titled “Enhancing Financial Flexibility” located in the investor section of the Company’s website.
About Host Hotels & Resorts
* This press release contains registered trademarks that are the exclusive property of their respective owners. None of the owners of these trademarks has any responsibility or liability for any information contained in this press release.
Chief Financial Officer
(240) 744-5267
Investor Relations
(240) 744-5116
ir@hosthotels.com
Source: Host Hotels & Resorts, Inc.