*Variable rate loans for which INDUS entered into interest rate swap agreements to effectively fix the interest rates on these loans to the rates reflected above.

INDUS’ weighted average interest rate on its mortgage loans and its construction loan, including the effect of its interest rate swap agreements, was 3.76% as of March 31, 2022 and December 31, 2021. The Company accounts for its interest rate swap agreements as effective cash flow hedges. Amounts in accumulated other comprehensive income (“AOCI”) will be reclassified into interest expense over the term of the swap agreements to achieve fixed interest rates on each variable rate mortgage. None of the interest rate swap agreements contain any credit risk related contingent features. In the first quarter of 2022 and 2021, INDUS recognized gains, included in other comprehensive income, of $4,662 and $3,479, respectively, on its interest rate swap agreements. As of March 31, 2022, $361 was expected to be reclassified over the next twelve months to AOCI from interest expense. Interest expense related to INDUS’ interest rate swap agreements in the first quarters of 2022 and 2021 was $451 and $488, respectively.

The following table summarizes the notional and fair value of our interest rate swaps designated as cash flow hedges at March 31, 2022 and December 31, 2021:


						Fair Value of Interest Rate
				Current Notional Value		Derivative Assets/(Liabilities)
			LIBOR	(in thousands)		(in thousands)
Effective	Maturity		Interest	March 31,	December 31,	March 31,	December 31,
Date	Date		Strike Rate	2022	2021	2022	2021

September 1, 2013	September 1, 2023	(a)	2.840%	$ 7,133	$ 7,204	($ 71)	($ 249)
January 1, 2015	January 1, 2025	(a)	2.260%	8,990	9,068	88	(390)
January 1, 2016	January 1, 2025	(a)	1.932%	1,538	1,552	20	(40)

September 1, 2015	September 1, 2025	(b)	2.118%	2,165	9,608	93	(334)
December 10, 2015	September 1, 2025	(b)	2.015%	9,521	2,185	28	(68)
November 17, 2016	November 17, 2026	(b)	2.085%	11,272	11,359	129	(518)

May 3, 2016	May 1, 2026		1.910%	12,185	12,291	216	(369)

March 15, 2017	March 1, 2027	(c)	2.501%	10,538	10,621	(73)	(641)
February 1, 2018	February 1, 2028	(c)	2.782%	6,487	6,524	(213)	(641)

July 14, 2017	August 1, 2027		4.390%	9,405	9,476	(8)	(526)

January 2, 2020	January 1, 2030		1.849%	6,139	6,182	158	(219)

July 1, 2020	July 1, 2030		0.942%	4,881	4,914	488	188

				$ 90,254	$ 90,984	$ 855	($ 3,807)

(a) (b) and (c) represent multiple interest rate swap agreements against a single mortgage

In July 2017, the Financial Conduct Authority in the United Kingdom, which regulates LIBOR, announced that it intends to stop compelling banks to submit rates for the calculation of LIBOR after June 30, 2023. INDUS currently expects LIBOR-indexed rates to be available through that date, however, it is possible that they will become unavailable prior to that time. The interest rate on INDUSs floating rate debt under nonrecourse mortgage loans is based on LIBOR, however, INDUS entered into interest rate swap agreements whereby the floating LIBOR rates under all mortgage loans are hedged, effectively fixing the interest rate on those loans. INDUS’ loan documents contain provisions that contemplate alternative methods to determine the base rate applicable to our LIBOR-indexed debt to the extent LIBOR-indexed rates are not available. INDUS will continue to monitor and evaluate the impact, if any, on debt payments and the value of the Company’s floating rate debt.

On April 21, 2022, INDUS entered into an Amended and Restated Credit Agreement (the “Credit Agreement”) for a $250 million secured credit facility (the “New Credit Facility”) (see Note 6), amending and restating the $100 million credit facility executed on August 5, 2021 (the “Existing Credit Facility”) to include the addition of a delayed draw term loan facility (the “DDTL Facility”) of $150 million for a term of five years, pursuant to which up to three separate draws may be made prior to April 21, 2023 (the first two of which must each be in a minimum amount of $25 million). The DDTL will bear interest at the Secured Overnight Financing Rate (“SOFR”) plus 1.15%, based on the Company’s ratio of total indebtedness to total assets. Concurrent with the closing on the DDTL, the Company entered into an interest rate swap agreement to fix the interest rate on the DDTL at an effective rate of 4.15%.