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.

The following tables present the consolidating financial information for the Subsidiary Guarantors:

FelCor Lodging Limited Partnership

Condensed Consolidating Balance Sheet

June 30, 2019

(in thousands)



	FelCor LP		Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations			Total Consolidated
Equity investment in consolidated entities	$	1,703,019	$	—	$	—	$	(1,703,019	)	$	—
Investment in hotel properties, net	—		563,919		1,384,495		—			1,948,414
Investment in unconsolidated joint ventures	15,803		—		—		—			15,803
Cash and cash equivalents	1,526		—		12,189		—			13,715
Restricted cash reserves	444		—		4,637		—			5,081
Related party rent receivable	—		10,157		20,154		—			30,311
Lease right-of-use assets	4,665		68,475		9,646		—			82,786
Prepaid expense and other assets	1,820		650		3,061		—			5,531
Related party prepaid interest	—		—		178		—			178
Total assets	$	1,727,277	$	643,201	$	1,434,360	$	(1,703,019	)	$	2,101,819

Debt, net	$	502,959	$	24,680	$	222,785	$	(32,709	)	$	717,715
Related party debt	—		—		85,000		—			85,000
Accounts payable and other liabilities	7,069		12,550		9,078		—			28,697
Related party lease termination fee payable	—		344		368		—			712
Lease liabilities	4,855		26,191		17,919		—			48,965
Accrued interest	2,463		—		—		—			2,463
Total liabilities	517,346		63,765		335,150		(32,709		)	883,552

Partnership interests	1,209,931		579,436		1,090,874		(1,670,310		)	1,209,931
Total partners' capital, excluding noncontrolling interest	1,209,931		579,436		1,090,874		(1,670,310		)	1,209,931
Noncontrolling interest in consolidated joint ventures	—		—		8,336		—			8,336
Total partners’ capital	1,209,931		579,436		1,099,210		(1,670,310		)	1,218,267
Total liabilities and partners’ capital	$	1,727,277	$	643,201	$	1,434,360	$	(1,703,019	)	$	2,101,819

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 rent 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 Loss

For the Three Months Ended June 30, 2019

(in thousands)



	FelCor LP			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Revenues
Related party lease revenue	$	—		$	22,674		$	33,547		$	—		$	56,221
Total revenues	—			22,674			33,547			—			56,221

Expenses
Depreciation and amortization	120			6,818			11,356			—			18,294
Property tax, insurance and other	41			5,091			5,450			—			10,582
General and administrative	190			66			13			—			269
Transaction costs	(31		)	(8		)	(103		)	—			(142		)
Total operating expenses	320			11,967			16,716			—			29,003
Other income	—			—			2			—			2
Interest income	202			—			58			(195		)	65
Interest expense	(5,944		)	(265		)	(2,244		)	195			(8,258		)
Related party interest expense	—			—			(1,171		)	—			(1,171		)
Loss on sale of hotel properties, net	—			(10,631		)	(10,751		)	—			(21,382		)
Loss before equity in income from unconsolidated joint ventures	(6,062		)	(189		)	2,725			—			(3,526		)
Equity in income from consolidated entities	2,436			—			—			(2,436		)	—
Equity in income from unconsolidated joint ventures	428			—			—			—			428
Net loss and comprehensive loss	(3,198		)	(189		)	2,725			(2,436		)	(3,098		)
Noncontrolling interest in consolidated joint ventures	—			—			(100		)	—			(100		)
Net loss and comprehensive loss attributable to FelCor LP	$	(3,198	)	$	(189	)	$	2,625		$	(2,436	)	$	(3,198	)

FelCor Lodging Limited Partnership

Condensed Consolidating Statement of Operations and Comprehensive Income

For the Three Months Ended June 30, 2018

(in thousands)



	FelCor LP			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Revenues
Related party lease revenue	$	—		$	23,833		$	36,817		$	—		$	60,650
Total revenues	—			23,833			36,817			—			60,650

Expenses
Depreciation and amortization	114			8,361			12,017			—			20,492
Property tax, insurance and other	61			7,228			6,767			—			14,056
General and administrative	492			15			44			—			551
Transaction costs	474			92			81			—			647
Total operating expenses	1,141			15,696			18,909			—			35,746
Other income	2			—			100			—			102
Interest income	131			—			—			(78		)	53
Interest expense	(5,944		)	—			(2,742		)	78			(8,608		)
Gain on sale of hotel properties, net	—			(17		)	59			—			42
Gain on extinguishment of indebtedness	7			—			—			—			7
Income before equity in income from unconsolidated joint ventures	(6,945		)	8,120			15,325			—			16,500
Equity in income from consolidated entities	23,034			—			—			(23,034		)	—
Equity in income from unconsolidated joint ventures	611			—			—			—			611
Net income and comprehensive income	16,700			8,120			15,325			(23,034		)	17,111
Noncontrolling interest in consolidated joint ventures	—			—			(42		)	—			(42		)
Preferred distributions - consolidated joint venture	—			—			(369		)	—			(369		)
Net income and comprehensive income attributable to FelCor LP	$	16,700		$	8,120		$	14,914		$	(23,034	)	$	16,700

FelCor Lodging Limited Partnership

Condensed Consolidating Statement of Operations and Comprehensive Income

For the Six Months Ended June 30, 2019

(in thousands)



	FelCor LP			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Revenues
Related party lease revenue	$	—		$	40,946		$	65,196		$	—		$	106,142
Total revenues	—			40,946			65,196			—			106,142

Expenses
Depreciation and amortization	234			13,583			22,771			—			36,588
Property tax, insurance and other	68			9,997			11,025			—			21,090
General and administrative	574			87			22			—			683
Transaction costs	64			—			46			—			110
Total operating expenses	940			23,667			33,864			—			58,471
Other income	39			10			1			—			50
Interest income	441			—			109			(389		)	161
Interest expense	(11,888		)	(265		)	(3,741		)	389			(15,505		)
Related party interest expense	—			—			(2,337		)	—			(2,337		)
Loss on sale of hotel properties, net	—			(10,631		)	(10,751		)	—			(21,382		)
Income before equity in income from unconsolidated joint ventures	(12,348		)	6,393			14,613			—			8,658
Equity in income from consolidated entities	19,671			—			—			(19,671		)	—
Equity in income from unconsolidated joint ventures	535			—			—			—			535
Net income and comprehensive income	7,858			6,393			14,613			(19,671		)	9,193
Noncontrolling interest in consolidated joint ventures	—			—			4			—			4
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	$	7,858		$	6,393		$	13,278		$	(19,671	)	$	7,858

FelCor Lodging Limited Partnership

Condensed Consolidating Statement of Operations and Comprehensive Income

For the Six Months Ended June 30, 2018

(in thousands)



	FelCor LP			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Revenues
Related party lease revenue	$	—		$	42,685		$	71,515		$	—		$	114,200
Total revenues	—			42,685			71,515			—			114,200

Expenses
Depreciation and amortization	228			17,113			23,863			—			41,204
Property tax, insurance and other	103			14,713			14,071			—			28,887
General and administrative	973			55			131			—			1,159
Transaction costs	1,983			101			91			—			2,175
Total operating expenses	3,287			31,982			38,156			—			73,425
Other income	10			—			100			—			110
Interest income	239			—			—			(156		)	83
Interest expense	(16,530		)	—			(5,381		)	156			(21,755		)
Loss on sale of hotel properties, net	—			(9,415		)	91			—			(9,324		)
Gain on extinguishment of indebtedness	12,936			—			—			—			12,936
Income before equity in income from unconsolidated joint ventures	(6,632		)	1,288			28,169			—			22,825
Equity in income from consolidated entities	28,756			—			—			(28,756		)	—
Equity in income from unconsolidated joint ventures	727			—			—			—			727
Net income and comprehensive income	22,851			1,288			28,169			(28,756		)	23,552
Noncontrolling interest in consolidated joint ventures	—			—			34			—			34
Preferred distributions - consolidated joint venture	—			—			(735		)	—			(735		)
Net income and comprehensive income attributable to FelCor LP	$	22,851		$	1,288		$	27,468		$	(28,756	)	$	22,851

FelCor Lodging Limited Partnership

Condensed Consolidating Statement of Cash Flows

For the Six Months Ended June 30, 2019

(in thousands)



	FelCor LP			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Operating activities:
Cash flows from operating activities	$	(15,587	)	$	28,065		$	41,960		$	—		$	54,438
Investing activities:
Proceeds from the sale of hotel properties, net	—			82,372			63,017			—			145,389
Improvements and additions to hotel properties	—			(14,727		)	(17,249		)	—			(31,976		)
Additions to property and equipment	(102		)	—			—			—			(102		)
Contributions to unconsolidated joint ventures	(603		)	—			—			—			(603		)
Intercompany financing	230,069			—			—			(230,069		)	—
Cash flows from investing activities	229,364			67,645			45,768			(230,069		)	112,708
Financing activities:
Proceeds from borrowings	—			25,000			71,000			—			96,000
Repayments of borrowings	—			—			(1,292		)	—			(1,292		)
Contributions from partners	115,123			—			—			—			115,123
Distributions to partners	(338,149		)	—			—			—			(338,149		)
Payments of deferred financing costs	—			(337		)	(643		)	—			(980		)
Preferred distributions - consolidated joint venture	—			—			(312		)	—			(312		)
Redemption of preferred capital - consolidated joint venture	—			—			(45,583		)	—			(45,583		)
Contributions from consolidated joint venture partners	—			—			2,281			—			2,281
Intercompany financing	—			(120,373		)	(109,696		)	230,069			—
Cash flows from financing activities	(223,026		)	(95,710		)	(84,245		)	230,069			(172,912		)
Net change in cash, cash equivalents, and restricted cash reserves	(9,249		)	—			3,483			—			(5,766		)
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 period	$	1,970		$	—		$	16,826		$	—		$	18,796

FelCor Lodging Limited Partnership

Condensed Consolidating Statement of Cash Flows

For the Six Months Ended June 30, 2018

(in thousands)



	FelCor LP			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Operating activities:
Cash flows from operating activities	$	(42,177	)	$	46,769		$	72,134		$	—		$	76,726
Investing activities:
Proceeds from the sale of hotel properties, net	—			116,458			92			—			116,550
Improvements and additions to hotel properties	—			(10,945		)	(22,848		)	—			(33,793		)
Additions to property and equipment	(4		)	—			—			—			(4		)
Intercompany financing	201,745			—			—			(201,745		)	—
Cash flows from investing activities	201,741			105,513			(22,756		)	(201,745		)	82,753
Financing activities:
Repayments of borrowings	(538,809		)	—			(1,495		)	—			(540,304		)
Contributions from partners	641,783			—			—			—			641,783
Distributions to partners	(262,128		)	—			—			—			(262,128		)
Payments of deferred financing costs	—			—			(10		)	—			(10		)
Preferred distributions - consolidated joint venture	—			—			(739		)	—			(739		)
Intercompany financing	—			(152,282		)	(49,463		)	201,745			—
Cash flows from financing activities	(159,154		)	(152,282		)	(51,707		)	201,745			(161,398		)
Net change in cash, cash equivalents, and restricted cash reserves	410			—			(2,329		)	—			(1,919		)
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 period	$	10,047		$	—		$	6,065		$	—		$	16,112