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Chatham Lodging Trust Executes Credit Facility Amendment
Extends Relief on Key Covenant Requirements: Balance Sheet and Liquidity Remain Strong
Key terms of this amendment, which are applicable during the waiver period, are as follows:
Waiver of key financial covenants through
December 31, 2021.
Testing of covenants as of
March 31, 2022
- Testing of covenants as of
Continues to allow for full utilization of entire
$250 millioncredit facility.
Uphold applicable margin on borrowings at LIBOR plus 250 basis points if borrowings on the credit facility are under
$200 millionand LIBOR plus 300 basis points if borrowings are over $200 million.
Maintain minimum liquidity of
$25 millionwhether in cash or available capacity under the credit facility.
- Allow common share dividends limited to 100 percent of REIT taxable income, and any dividends paid would include a cash component no greater than the minimum percentage allowed under the Internal Revenue Code.
Chatham has estimated liquidity of
Participating lenders in the credit facility include Barclays Bank PLC,
“We very much appreciate the collaborative efforts of our participating lending partners to execute this amendment to our credit facility with no significant changes compared to the first amendment earlier this year. This is a testament to our high quality hotels, our performance and the corporate actions we have taken throughout the pandemic to solidify our financial position,” highlighted
Forward-Looking Statement Safe Harbor
Note: This press release contains forward-looking statements within the meaning of federal securities regulations. These forward-looking statements include those with regard to the potential future impact of the COVID-19 pandemic, within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements include information about possible or assumed future results of the lodging industry and our business, financial condition, liquidity, results of operations, cash flow and plans and objectives. These statements generally are characterized by the use of the words “believe,” “expect,” “anticipate,” “estimate,” “plan,” “continue,” “intend,” “should,” “may” or similar expressions. Although we believe that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, our actual results could differ materially from those set forth in the forward-looking statements. Important factors that we think could cause our actual results to differ materially from expected results are summarized below.
One of the most significant factors, however, is the ongoing impact of the current outbreak of the COVID-19 pandemic on
Other risks include, but are not limited to: national and local economic and business conditions, including the effect on travel of potential terrorist attacks, that will affect occupancy rates at the company’s hotels and the demand for hotel products and services; operating risks associated with the hotel business; risks associated with the level of the company’s indebtedness and its ability to meet covenants in its debt agreements; relationships with property managers; the company’s ability to maintain its properties in a first-class manner, including meeting capital expenditure requirements; the company’s ability to compete effectively in areas such as access, location, quality of accommodations and room rate structures; changes in travel patterns, taxes and government regulations which influence or determine wages, prices, construction procedures and costs; the company’s ability to complete acquisitions and dispositions; and the company’s ability to continue to satisfy complex rules in order for the company to remain a REIT for federal income tax purposes and other risks and uncertainties associated with the company’s business described in the company's filings with the
Given these uncertainties, undue reliance should not be placed on such statements. We undertake no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect future events or circumstances or to reflect the occurrence of unanticipated events. The forward-looking statements should also be read in light of the risk factors identified in the “Risk Factors” section in the Company’s Annual Report on Form 10-K for the year ended