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.

For the Predecessor period, FelCor TRS was a subsidiary guarantor in the condensed consolidating balance sheet, the condensed consolidating statements of operations and comprehensive income, and the condensed consolidating statements of cash flows. Pursuant to the terms of each of the indentures governing the Senior Notes, upon completion of the distribution of the equity interests in FelCor TRS, FelCor TRS' guarantee of the Senior Notes was automatically released and FelCor TRS Holdings, L.L.C. ceased being a subsidiary guarantor of the Senior Notes. Accordingly, FelCor TRS is not a subsidiary guarantor in the FelCor LP consolidating financial information for the Company.

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

FelCor Lodging Limited Partnership

Condensed Consolidating Balance Sheet

December 31, 2019

(in thousands)



	FelCor LP		Subsidiary Guarantors		Non-Guarantor Subsidiaries		Eliminations			Total Consolidated
Equity investment in consolidated entities	$	1,722,133	$	—	$	—	$	(1,722,133	)	$	—
Investment in hotel properties, net	—		571,769		1,375,057		—			1,946,826
Investment in unconsolidated joint ventures	15,171		—		—		—			15,171
Cash and cash equivalents	1,985		—		17,587		—			19,572
Restricted cash reserves	447		—		3,700		—			4,147
Related party receivable	1,360		15,217		32,604		—			49,181
Lease right-of-use assets	4,444		66,571		9,620		—			80,635
Prepaid expense and other assets	1,748		1,888		3,907		—			7,543
Total assets	$	1,747,288	$	655,445	$	1,442,475	$	(1,722,133	)	$	2,123,075

Debt, net	$	500,484	$	24,711	$	221,241	$	(32,709	)	$	713,727
Related party debt	—		—		85,000		—			85,000
Accounts payable and other liabilities	7,449		15,017		10,210		—			32,676
Lease liabilities	4,661		25,571		17,968		—			48,200
Accrued interest	2,463		—		—		—			2,463
Related party accrued interest	—		—		190		—			190
Total liabilities	515,057		65,299		334,609		(32,709		)	882,256

Partnership interests	1,232,231		590,146		1,099,278		(1,689,424		)	1,232,231
Total partners' capital, excluding noncontrolling interest	1,232,231		590,146		1,099,278		(1,689,424		)	1,232,231
Noncontrolling interest in consolidated joint ventures	—		—		8,588		—			8,588
Total partners’ capital	1,232,231		590,146		1,107,866		(1,689,424		)	1,240,819
Total liabilities and partners’ capital	$	1,747,288	$	655,445	$	1,442,475	$	(1,722,133	)	$	2,123,075

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 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 Income

For the Year Ended December 31, 2019 (Successor)

(in thousands)



	FelCor LP			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Revenues
Related party lease revenue	$	—		$	74,621		$	122,074		$	—		$	196,695
Total revenues	—			74,621			122,074			—			196,695

Expenses
Depreciation and amortization	512			26,832			45,045			—			72,389
Property tax, insurance and other	(24		)	19,367			21,622			—			40,965
General and administrative	1,066			159			64			—			1,289
Transaction costs	164			—			77			—			241
Total operating expenses	1,718			46,358			66,808			—			114,884
Other income	39			10			10			—			59
Interest income	898			—			232			(783		)	347
Interest expense	(23,793		)	(765		)	(8,155		)	783			(31,930		)
Related party interest expense	—			—			(4,529		)	—			(4,529		)
Loss on sale of hotel properties, net	—			(10,638		)	(10,813		)	—			(21,451		)
Income before equity in income from unconsolidated joint ventures	(24,574		)	16,870			32,011			—			24,307
Equity in income from consolidated entities	47,294			—			—			(47,294		)	—
Equity in income from unconsolidated joint ventures	816			—			—			—			816
Net income and comprehensive income	23,536			16,870			32,011			(47,294		)	25,123
Noncontrolling interest in consolidated joint ventures	—			—			(248		)	—			(248		)
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	$	23,536		$	16,870		$	30,424		$	(47,294	)	$	23,536

FelCor Lodging Limited Partnership

Condensed Consolidating Statement of Operations and Comprehensive Income

For the Year Ended December 31, 2018 (Successor)

(in thousands)



	FelCor LP			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Revenues
Related party lease revenue	$	—		$	87,898		$	129,699		$	—		$	217,597
Total revenues	—			87,898			129,699			—			217,597

Expenses
Depreciation and amortization	458			31,806			46,227			—			78,491
Property tax, insurance and other	134			27,948			25,672			—			53,754
General and administrative	840			117			99			—			1,056
Transaction costs	2,039			8			139			—			2,186
Total operating expenses	3,471			59,879			72,137			—			135,487
Other income	10			—			103			—			113
Interest income	805			—			84			(578		)	311
Interest expense	(28,428		)	—			(10,080		)	578			(37,930		)
Related party interest expense	—			—			(708		)	—			(708		)
Gain on sale of hotel properties, net	—			(15,763		)	34,186			—			18,423
Gain on extinguishment of indebtedness, net	12,931			—			(1,665		)	—			11,266
Income before equity in income from unconsolidated joint ventures	(18,153		)	12,256			79,482			—			73,585
Equity in income from consolidated entities	90,096			—			—			(90,096		)	—
Equity in income from unconsolidated joint ventures	1,395			—			—			—			1,395
Net income and comprehensive income	73,338			12,256			79,482			(90,096		)	74,980
Noncontrolling interest in consolidated joint ventures	—			—			(159		)	—			(159		)
Preferred distributions - consolidated joint venture	—			—			(1,483		)	—			(1,483		)
Net income and comprehensive income attributable to FelCor LP	$	73,338		$	12,256		$	77,840		$	(90,096	)	$	73,338

FelCor Lodging Limited Partnership

Condensed Consolidating Statement of Operations and Comprehensive Income

For the Period of September 1, 2017 through December 31, 2017 (Successor)

(in thousands)



	FelCor LP			Subsidiary Guarantors		Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Revenues
Related party lease revenue	$	—		$	32,572	$	48,687		$	—		$	81,259
Total revenues	—			32,572		48,687			—			81,259

Expenses
Depreciation and amortization	151			12,164		16,650			—			28,965
Property tax, insurance and other	25			8,800		8,237			—			17,062
General and administrative	904			59		56			—			1,019
Transaction costs	4,079			105		9			—			4,193
Total operating expenses	5,159			21,128		24,952			—			51,239
Interest income	113			—		1			(104		)	10
Interest expense	(15,918		)	—		(3,456		)	104			(19,270		)
Loss on sale of hotel properties	—			—		(6,637		)	—			(6,637		)
Income before equity in income from unconsolidated joint ventures	(20,964		)	11,444		13,643			—			4,123
Equity in income from consolidated entities	24,434			—		—			(24,434		)	—
Equity in income from unconsolidated joint ventures	661			—		—			—			661
Net income and comprehensive income	4,131			11,444		13,643			(24,434		)	4,784
Noncontrolling interest in consolidated joint ventures	—			—		(157		)	—			(157		)
Preferred distributions - consolidated joint venture	—			—		(496		)	—			(496		)
Net income and comprehensive income attributable to FelCor LP	$	4,131		$	11,444	$	12,990		$	(24,434	)	$	4,131

FelCor Lodging Limited Partnership

Condensed Consolidating Statement of Operations and Comprehensive Loss

For the Period of January 1, 2017 through August 31, 2017 (Predecessor)

(in thousands)



	FelCor LP			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Revenues
Room revenue	$	—		$	425,682		$	—		$	—		$	425,682
Food and beverage revenue	—			90,572			—			—			90,572
Related party lease revenue	—			—			84,509			(84,509		)	—
Other revenue	41			34,883			337			—			35,261
Total revenues	41			551,137			84,846			(84,509		)	551,515

Expenses
Room expense	—			112,813			—			—			112,813
Food and beverage expense	—			71,828			—			—			71,828
Management and franchise fee expense	—			19,901			—			—			19,901
Other operating expense	—			147,827			—			—			147,827
Total property operating expenses	—			352,369			—			—			352,369
Depreciation and amortization	309			28,064			44,692			—			73,065
Impairment loss	—			35,109			—			—			35,109
Property tax, insurance and other	921			111,020			16,846			(84,509		)	44,278
General and administrative	—			8,914			7,092			—			16,006
Transaction costs	68,248			—			—			—			68,248
Total operating expenses	69,478			535,476			68,630			(84,509		)	589,075
Other income	—			—			100			—			100
Intercompany interest income (expense)	241			—			(241		)	—			—
Interest income	66			59			1			—			126
Interest expense	(38,722		)	—			(12,968		)	—			(51,690		)
Loss on sale of hotel properties, net	2			(1,565		)	(201		)	—			(1,764		)
Loss on extinguishment of indebtedness	—			—			(3,278		)	—			(3,278		)
Loss before equity in income from unconsolidated joint ventures	(107,850		)	14,155			(371		)	—			(94,066		)
Equity in income from consolidated entities	12,779			—			—			(12,779		)	—
Equity in income from unconsolidated joint ventures	1,181			(77		)	(30		)	—			1,074
Loss before income tax expense	(93,890		)	14,078			(401		)	(12,779		)	(92,992		)
Income tax expense	(35		)	(464		)	—			—			(499		)
Loss from continuing operations	(93,925		)	13,614			(401		)	(12,779		)	(93,491		)
Loss from discontinued operations	(3,415		)	—			—			—			(3,415		)
Net loss and comprehensive loss	(97,340		)	13,614			(401		)	(12,779		)	(96,906		)
Noncontrolling interest in consolidated joint ventures	—			336			209			—			545
Preferred distributions - consolidated joint venture	—			—			(979		)	—			(979		)
Net loss and comprehensive loss attributable to FelCor LP	(97,340		)	13,950			(1,171		)	(12,779		)	(97,340		)
Preferred distributions	(16,744		)	—			—			—			(16,744		)
Net loss and comprehensive loss attributable to FelCor LP common unitholders	$	(114,084	)	$	13,950		$	(1,171	)	$	(12,779	)	$	(114,084	)

FelCor Lodging Limited Partnership

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2019 (Successor)

(in thousands)



	FelCor LP			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Operating activities:
Cash flows from operating activities	$	(30,086	)	$	46,685		$	68,415		$	—		$	85,014
Investing activities:
Proceeds from the sale of hotel properties, net	—			81,943			62,504			—			144,447
Improvements and additions to hotel properties	(162		)	(33,146		)	(28,707		)	—			(62,015		)
Contributions to unconsolidated joint ventures	(603		)	—			—			—			(603		)
Intercompany financing	238,580			—			—			(238,580		)	—
Cash flows from investing activities	237,815			48,797			33,797			(238,580		)	81,829
Financing activities:
Proceeds from borrowings	—			25,000			71,000			—			96,000
Repayments of borrowings	(112		)	—			(2,566		)	—			(2,678		)
Contributions from partners	188,318			—			—			—			188,318
Distributions to partners	(404,722		)	—			—			—			(404,722		)
Payments of deferred financing costs	—			(340		)	(650		)	—			(990		)
Contributions from consolidated joint venture partners	—			—			2,281			—			2,281
Preferred distributions - consolidated joint venture	—			—			(312		)	—			(312		)
Redemption of preferred capital - consolidated joint venture	—			—			(45,583		)	—			(45,583		)
Intercompany financing	—			(120,142		)	(118,438		)	238,580			—
Cash flows from financing activities	(216,516		)	(95,482		)	(94,268		)	238,580			(167,686		)
Net change in cash, cash equivalents, and restricted cash reserves	(8,787		)	—			7,944			—			(843		)
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 year	$	2,432		$	—		$	21,287		$	—		$	23,719

FelCor Lodging Limited Partnership

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2018 (Successor)

(in thousands)



	FelCor LP			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Operating activities:
Cash flows from operating activities	$	(53,388	)	$	93,671		$	132,962		$	—		$	173,245
Investing activities:
Proceeds from the sale of hotel properties, net	—			178,170			267,117			—			445,287
Improvements and additions to hotel properties	(4		)	(27,530		)	(46,850		)	—			(74,384		)
Intercompany financing	560,256			—			—			(560,256		)	—
Cash flows from investing activities	560,252			150,640			220,267			(560,256		)	370,903
Financing activities:
Proceeds from borrowings - related party	—			—			85,000			—			85,000
Repayments of borrowings	(538,814		)	—			(115,842		)	—			(654,656		)
Contributions from partners	732,319			—			—			—			732,319
Distributions to partners	(698,787		)	—			—			—			(698,787		)
Payment of deferred financing costs	—			—			(10		)	—			(10		)
Preferred distributions - consolidated joint venture	—			—			(1,483		)	—			(1,483		)
Intercompany financing	—			(244,311		)	(315,945		)	560,256			—
Cash flows from financing activities	(505,282		)	(244,311		)	(348,280		)	560,256			(537,617		)
Net change in cash, cash equivalents, and restricted cash reserves	1,582			—			4,949			—			6,531
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 year	$	11,219		$	—		$	13,343		$	—		$	24,562

FelCor Lodging Limited Partnership

Condensed Consolidating Statement of Cash Flows

For the Period of September 1, 2017 through December 31, 2017 (Successor)

(in thousands)



	FelCor LP			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Operating activities:
Cash flows from operating activities	$	(44,202	)	$	(11,078	)	$	(16,872	)	$	—		$	(72,152	)
Investing activities:
Proceeds from the sale of hotel properties, net	—			—			165,893			—			165,893
Improvements and additions to hotel properties	—			(5,704		)	(17,933		)	—			(23,637		)
Intercompany financing	108,590			—			—			(108,590		)	—
Cash flows from investing activities	108,590			(5,704		)	147,960			(108,590		)	142,256
Financing activities:
Repayments of borrowings	(990		)	—			(1,174		)	—			(2,164		)
Contributions from partners	130,076			—			—			—			130,076
Distributions to partners	(187,616		)	—			—			—			(187,616		)
Distribution of FelCor TRS	—			(51,867		)	—			—			(51,867		)
Distributions to preferred unitholders	(4,186		)	—			—			—			(4,186		)
Payment of deferred financing costs	—			—			(254		)	—			(254		)
Preferred distributions - consolidated joint venture	—			—			(496		)	—			(496		)
Intercompany financing	—			20,142			(128,732		)	108,590			—
Cash flows from financing activities	(62,716		)	(31,725		)	(130,656		)	108,590			(116,507		)
Net change in cash, cash equivalents, and restricted cash reserves	1,672			(48,507		)	432			—			(46,403		)
Cash, cash equivalents, and restricted cash reserves, beginning of period	7,965			48,507			7,962			—			64,434
Cash, cash equivalents, and restricted cash reserves, end of period	$	9,637		$	—		$	8,394		$	—		$	18,031

FelCor Lodging Limited Partnership

Condensed Consolidating Statement of Cash Flows

For the Period of January 1, 2017 through August 31, 2017 (Predecessor)

(in thousands)



	FelCor LP			Subsidiary Guarantors			Non-Guarantor Subsidiaries			Eliminations			Total Consolidated
Operating activities:
Cash flows from operating activities	$	(40,773	)	$	85,899		$	54,214		$	—		$	99,340
Investing activities:
Proceeds from the sale of hotel properties, net	(696		)	74,281			(169		)	—			73,416
Improvements and additions to hotel properties	1			(16,727		)	(47,076		)	—			(63,802		)
Distributions from unconsolidated joint ventures in excess of earnings	840			—			—			—			840
Intercompany financing	91,391			—			—			(91,391		)	—
Cash flows from investing activities	91,536			57,554			(47,245		)	(91,391		)	10,454
Financing activities:
Proceeds from borrowings	—			—			66,000			—			66,000
Repayment of borrowings	—			—			(121,691		)	—			(121,691		)
Distributions to preferred unitholders	(18,836		)	—			—			—			(18,836		)
Distributions to common unitholders	(30,926		)	—			—			—			(30,926		)
Distributions to consolidated joint venture partners	—			—			(150		)	—			(150		)
Contributions from consolidated joint venture partners	—			333			—			—			333
Net proceeds from the issuance of preferred capital in a consolidated joint venture	—			—			647			—			647
Intercompany financing	—			(140,853		)	49,462			91,391			—
Other	(6,568		)	—			(977		)	—			(7,545		)
Cash flows from financing activities	(56,330		)	(140,520		)	(6,709		)	91,391			(112,168		)
Net change in cash, cash equivalents, and restricted cash reserves	(5,567		)	2,933			260			—			(2,374		)
Cash, cash equivalents, and restricted cash reserves, beginning of period	13,532			45,574			7,702			—			66,808
Cash, cash equivalents, and restricted cash reserves, end of period	$	7,965		$	48,507		$	7,962		$	—		$	64,434