-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, IdfV4JhNmxPOteXDBQRUtZdAIeLnPvicU+L/i8Dug5NHnerIE21nrR95LrCBvIpo 83uRLdnwV25p7MOxuNq99Q== 0000950134-03-006873.txt : 20030501 0000950134-03-006873.hdr.sgml : 20030501 20030430215618 ACCESSION NUMBER: 0000950134-03-006873 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20030430 ITEM INFORMATION: Financial statements and exhibits ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20030501 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FELCOR LODGING TRUST INC CENTRAL INDEX KEY: 0000923603 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 752541756 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-14236 FILM NUMBER: 03674760 BUSINESS ADDRESS: STREET 1: 545 E JOHN CARPENTER FREEWAY STREET 2: SUITE 1300 CITY: IRVING STATE: TX ZIP: 75062 BUSINESS PHONE: 9724444900 MAIL ADDRESS: STREET 1: 545 E JOHN CARPENTER FREEWAY STREET 2: SUITE 1300 CITY: IRVING STATE: TX ZIP: 75062 FORMER COMPANY: FORMER CONFORMED NAME: FELCOR SUITE HOTELS INC DATE OF NAME CHANGE: 19940523 8-K 1 d05367e8vk.txt FORM 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): April 30, 2003 FELCOR LODGING TRUST INCORPORATED (Exact name of registrant as specified in its charter) MARYLAND 1-14236 75-2541756 (State or other jurisdiction of (Commission File Number) (IRS Employer incorporation) Identification No.) 545 E. JOHN CARPENTER FREEWAY SUITE 1300 IRVING, TEXAS 75062 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (972) 444-4900 (Former name or former address, if changed since last report) ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS. (c) Exhibits. 99.1- Press release issued by FelCor Lodging Trust Incorporated on April 30, 2003, announcing its results of operations for the quarterly period ended March 31, 2003. 99.2- First Quarter 2003 Supplemental Information, published by FelCor Lodging Trust Incorporated on April 30, 2003, providing additional corporate data, financial highlights and portfolio statistical data for the quarter ended March 31, 2003. ITEM 9. REGULATION FD DISCLOSURE. In accordance with Securities and Exchange Commission Release Nos. 33-8216 and 34-47583, the registrant hereby furnishes the information required by Item 12 of Form 8-K. On April 30, 2003, FelCor Lodging Trust Incorporated issued a press release announcing its results of operations for the quarterly period ended March 31, 2003, and published its First Quarter 2003 Supplemental Information, which provides additional corporate data, financial highlights and portfolio statistical data for the quarter ended March 31, 2003. Copies of the press release and the First Quarter 2003 Supplemental Information are furnished herewith as Exhibits 99.1 and 99.2, respectively. Copies of the foregoing are also available on FelCor's website at WWW.FELCOR.COM, on its Investor Relations page in the "Financial Reports" section. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. FELCOR LODGING TRUST INCORPORATED Date: April 30, 2003 By: /s/ Richard J. O'Brien ---------------------------------------- Name: Richard J. O'Brien Title: Executive Vice President and Chief Financial Officer INDEX TO EXHIBITS
No. Description --- ----------- 99.1- Press release issued by FelCor Lodging Trust Incorporated on April 30, 2003, announcing its results of operations for the quarterly period ended March 31, 2003. 99.2- First Quarter 2003 Supplemental Information, published by FelCor Lodging Trust Incorporated on April 30, 2003, providing additional corporate data, financial highlights and portfolio statistical data for the quarter ended March 31, 2003.
EX-99.1 3 d05367exv99w1.txt PRESS RELEASE EXHIBIT 99.1 [FELCOR LODGING TRUST LETTERHEAD] FOR IMMEDIATE RELEASE: FELCOR REPORTS FIRST QUARTER 2003 RESULTS - ANNOUNCES CLOSING OF $150 MILLION OF SECURED FINANCING IRVING, TEXAS...APRIL 30, 2003 - FelCor Lodging Trust Incorporated (NYSE: FCH), the nation's second largest hotel real estate investment trust (REIT), today reported operating results for the first quarter ended March 31, 2003. FIRST QUARTER RESULTS: FelCor's first quarter revenues were $307.3 million, which reflected a decline of 17.5 million, or 5.4 percent, compared to the first quarter in 2002. The decrease was primarily related to a 5.3 percent decline in the hotel portfolio's revenue per available room ("RevPAR"). For the quarter, occupancy decreased 1.2 percent, to 60.0 percent, and average daily rate ("ADR") decreased 4.1 percent, to $96.92, compared to the same quarter of 2002. The operating margin for FelCor's hotels during the first quarter 2003 was 29.0 percent, which reflected a 460 basis point decrease, compared to the same period in 2002. The deterioration in margins principally resulted from the 4.1 percent decline in ADR, coupled with increases in insurance, marketing, and energy costs for the quarter, compared to first quarter of 2002. FelCor's first quarter 2003 Funds From Operations ("FFO") was $9.6 million, or $0.15 per share. FFO for the same period last year was $29.3 million, or $0.44 per share. First quarter 2003 Earnings Before Interest, Taxes, Depreciation, Amortization ("EBITDA") totaled $59.8 million, compared to $77.2 million for first quarter of 2002. For the quarter, FelCor reported a net loss of $27.8 million, or a loss of $0.48 per share, compared to a first quarter 2002 net loss of $12.3 million, or $0.23 per share. The Company's operating results included a $953,000 gain on the early extinguishment of debt. "Sustained economic weakness and war-related uncertainties adversely affected FelCor's and the lodging industry's operating results for the first quarter. With the effective end of the war in Iraq and the reduction in the threat advisory level to "yellow" from "orange", we are seeing some recovery in forward bookings," said Thomas J. Corcoran, Jr., FelCor's President and CEO. CAPITAL STRUCTURE: On April 24, 2003, FelCor completed a $150 million non-recourse loan, at a spread over LIBOR of 250 basis points, which is secured by 10 full service hotels. The term of the loan is three years with two, one-year extension options. The proceeds were used to pay off all outstanding borrowings under FelCor's unsecured line of credit. FelCor also has reduced its line of credit from $300 million to $150 million in total commitments. -more- FelCor Lodging Trust First Quarter 2003 Operating Results April 30, 2003 Page 2 In April, FelCor announced the refinancing of $16 million of secured debt that was to mature in late 2003. In the first quarter, FelCor also prepaid $6 million in secured debt that was scheduled to mature this year. FelCor has no remaining debt maturing during 2003, other than $11 million in normal recurring principal payments. At March 31, 2003, FelCor had $2.0 billion of debt outstanding, and $156 million in cash and cash equivalents. The weighted average life of FelCor's debt is six years. The Company's next significant debt maturity is its $175 million of senior notes that will mature in October 2004. FelCor expects to meet this obligation from excess cash on hand, future cash flow from operations, its additional secured debt capacity, and from the proceeds of non-strategic hotel sales. "We have strengthened our financial position with the closing on our previously announced $150 million of secured debt financing, the reduction of our 2003 maturities, and the pay down of our line of credit. FelCor continues to hold excess cash and our balance sheet is in good shape," said Richard J. O'Brien, FelCor's Executive Vice President and Chief Financial Officer. OTHER HIGHLIGHTS: FelCor declared and paid first quarter dividends on its $1.95 Series A Cumulative Convertible Preferred Stock and its 9% Series B Cumulative Redeemable Preferred Stock. In February, FelCor announced plans to dispose of 33 non-strategic hotels over 36 months. These non-strategic hotels generally include smaller properties in secondary and tertiary locations. FelCor has announced the selected brokers to market 27 of these hotels. A listing of these hotels actively being marketed can be found on FelCor's Web site at www.felcor.com on the `Hotels' page. In March, FelCor converted an independently branded hotel in Dallas, Texas, to a Staybridge Suites(R) hotel. In April, FelCor completed the conversion of the 385-room Hilton Myrtle Beach Resort, following a $15 million renovation of the former Wyndham(R)-affiliated property. The resort is located on the ocean at the north end of Myrtle Beach and is adjacent to FelCor's Kingston Plantation complex, one of the largest and most comprehensive resort destination properties on the East Coast. 2003 GUIDANCE: Due to the uncertainties of the impact of the war in Iraq, heightened terrorism alerts, SARS and the impact of these events on the nation's economy, it is difficult to provide meaningful earnings guidance. Our current estimates for the second quarter and full year 2003 for recurring operating results, are as follows:
SECOND QUARTER 2003 -------------- ---- RevPAR down 7% to 8% down 3% to 4% Operating margin decrease 3% to 4% decrease 2.25% to 2.75% FFO per share $0.34 to $0.42 $0.80 to $0.95 EBITDA $72 to $77 million $252 to $260 million Net loss per share $0.24 to $0.32 $1.60 to $1.75
-more- FelCor Lodging Trust First Quarter 2003 Operating Results April 30, 2003 Page 3 Non-GAAP estimates of FFO and EBITDA are derived from our estimate of net loss applicable to common shareholders. Estimated FFO per share and unit was computed by dividing estimated FFO by today's weighted average shares and units outstanding. Estimated FFO was computed by taking estimated net loss applicable to common shareholders, adding forecasted depreciation expense ($40 million for the second quarter and $157 million for the year) and deducting forecasted minority interest in FelCor LP ($1 million for the second quarter and $5 million for the year). To derive estimated EBITDA, FelCor started with estimated FFO and added back interest expense ($43 million for the second quarter and $173 million for the year), amortization ($0.5 million for the second quarter and $2 million for the year) and preferred stock dividends ($7 million for the second quarter and $27 million for the year). FelCor's estimated RevPAR decline for the month of April is approximately 10.5 to 11.5 percent. The RevPAR decline is the direct result of reduced travel during the war in Iraq, the lack of comparability due to the occurrence of Easter in April 2003, as compared to March in 2002, and the continued economic softness. FelCor announced the suspension of its common dividend on February 4, 2003, and does not expect to pay a common dividend during 2003. FelCor's decision regarding future dividends on its preferred stock will be made quarterly, based on hotel operating results and its then estimates of the minimum distributions required to maintain its REIT status. The Company currently anticipates that its 2003 total capital expenditures will be between $60 and $70 million. FelCor has published its First Quarter 2003 Supplemental Information, which provides additional corporate data, financial highlights and portfolio statistical data for the quarter ended March 31, 2003. Investors are encouraged to access the Supplemental Information on the Company's Web site at www.felcor.com, on its Investor Relations page in the "Financial Reports" section. The Supplemental Information also will be furnished upon request. Requests may be made by e-mail to information@felcor.com or by writing to the Director of Investor Relations, FelCor Lodging Trust Incorporated, 545 E. John Carpenter Freeway, Suite 1300, Irving, Texas, 75062. FelCor is the nation's second largest lodging REIT and the nation's largest owner of full service, all-suite hotels. FelCor's consolidated portfolio is comprised of 169 hotels, located in 35 states and Canada. FelCor owns 77 upscale, all-suite hotels, and is the largest owner of Embassy Suites(R) and Doubletree Guest Suites(R) hotels. FelCor's portfolio also includes hotels in the upscale and full service segments. FelCor has a current market capitalization of approximately $2.8 billion. Additional information can be found on the Company's Web site at www.felcor.com. FelCor invites you to listen to its first quarter 2003 conference call on Thursday, May 1, 2003, at 10:00 a.m. (Central Standard Time). The conference call will be webcast simultaneously via FelCor's Web site at www.felcor.com. Interested investors and other parties who wish to access the call should go to FelCor's website and click on the conference call microphone icon on either the Investor Relations or FelCor News pages. A phone replay will be available from Thursday, May 1, 2003, at 12:00 p.m. (Central Standard Time), through Friday, May 30, 2003, at 7:00 p.m. (Central Standard Time), by dialing 416-695-6012 (access code is 2488). A recording of the call also will be archived and available at www.felcor.com. -more- FelCor Lodging Trust First Quarter 2003 Operating Results April 30, 2003 Page 4 With the exception of historical information, the matters discussed in this news release include "forward looking statements" within the meaning of the federal securities laws. Forward looking statements are not guarantees of future performance. Numerous risks and uncertainties, and the occurrence of future events, may cause actual results to differ materially from those currently anticipated. General economic conditions, including the timing and magnitude of any recovery from the current soft economy, the continuing impact of the war in Iraq, future acts of terrorism, the impact of SARS on the travel industry, the availability of capital, the ability to effect sales of non-strategic hotels at anticipated prices, and numerous other factors may affect future results, performance and achievements. Certain of these risks and uncertainties are described in greater detail in our filings with the Securities and Exchange Commission. Although we believe our current expectations to be based upon reasonable assumptions, we can give no assurance that our expectations will be attained or that actual results will not differ materially. Contact: Thomas J. Corcoran, Jr., President and CEO (972) 444-4901 tcorcoran@felcor.com Richard J. O'Brien, Executive Vice President and CFO (972) 444-4932 robrien@felcor.com Monica L. Hildebrand, Vice President of Communications (972) 444-4917 mhildebrand@felcor.com Stephen A. Schafer, Director of Investor Relations (972) 444-4912 sschafer@felcor.com
-more- FelCor Lodging Trust First Quarter 2003 Operating Results April 30, 2003 Page 5 RESULTS OF OPERATIONS - THREE MONTHS ENDED (in thousands, except per share data)
THREE MONTHS ENDED MARCH 31, --------------------------- 2003 2002 --------- --------- Revenues: Hotel operating revenue: Room $ 242,972 $ 257,230 Food and beverage 47,914 50,691 Other operating departments 16,060 16,219 Retail space rental and other revenue 400 670 --------- --------- Total revenues 307,346 324,810 --------- --------- Expenses: Hotel departmental expenses: Room 63,464 63,233 Food and beverage 38,939 39,991 Other operating departments 7,516 7,316 Other property related costs 91,824 89,160 Management and franchise fees 16,310 15,648 Taxes, insurance and lease expense 32,533 34,570 Corporate expenses 3,423 3,746 Depreciation 36,107 38,618 --------- --------- Total operating expenses 290,116 292,282 --------- --------- Operating income 17,230 32,528 Interest expense, net (40,253) (41,196) Gain on early extinguishment of debt 953 --------- --------- Loss before equity in income (loss) from unconsolidated entities and minority interests (22,070) (8,668) Equity in income (loss) from unconsolidated entities (148) 1,221 Minority interests 1,127 1,301 --------- --------- Net loss (21,091) (6,146) Preferred dividends (6,726) (6,150) --------- --------- Net loss applicable to common stockholders $ (27,817) $ (12,296) ========= ========= Basic and diluted per common share data: Net loss applicable to common stockholders $ (0.48) $ (0.23) ========= ========= Weighted average common shares outstanding 58,532 52,717
-more- FelCor Lodging Trust First Quarter 2003 Operating Results April 30, 2003 Page 6 RECONCILIATION OF FFO AND EBITDA (in thousands, except per share and unit data)
THREE MONTHS ENDED MARCH 31, ------------------------- 2003 2002 -------- -------- FUNDS FROM OPERATIONS (FFO) Net loss $(21,091) $ (6,146) Depreciation 36,107 38,618 Depreciation from unconsolidated entities 2,859 2,178 Preferred dividends: Series A preferred dividends (2,915) -- Series B preferred dividends (3,811) (3,234) Minority interest in FelCor LP (1,557) (2,087) -------- -------- FFO (a) $ 9,592 $ 29,329 ======== ======== FFO per common share and unit $ 0.15 $ 0.44 ======== ======== Basic and diluted net loss per common share $ (0.48) $ (0.23) ======== ======== Weighted average common shares outstanding 58,532 52,717 Weighted average FelCor LP units outstanding 3,289 9,005 Conversion of Series A preferred shares -- 4,636 Conversion of options and stock grants 309 357 -------- -------- Weighted average common shares and units outstanding 62,130 66,715 ======== ======== EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION (EBITDA) FFO $ 9,592 $ 29,329 Interest expense 40,628 41,775 Interest expense from unconsolidated entities 2,339 2,359 Amortization expense 516 509 Preferred dividends: Series A preferred dividends 2,915 -- Series B preferred dividends 3,811 3,234 -------- -------- EBITDA (a) $ 59,801 $ 77,206 ======== ========
(a) Includes a $953,000 gain on early extinguishment of debt. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminish predictably over time. Since real estate values instead have historically risen or fallen with market conditions, most industry investors consider supplemental measurements of performance to be helpful in evaluating a real estate company's operations. We consider FFO and EBITDA to be key measures of a REIT's performance and should be considered along with, but not as an alternative to, net income and cash flow as a measure of our operating performance. The White Paper on Funds From Operations approved by the Board of Governors of the National Association of Real Estate Investment Trusts ("NAREIT") defines FFO as net income or loss (computed in accordance with generally accepted accounting principles), excluding gains or losses from sales of property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures are calculated to reflect funds from operations on the same basis. We believe that FFO and EBITDA are helpful to investors as a measure of the performance of an equity REIT. We compute FFO in accordance with standards established by NAREIT. This may not be comparable to FFO reported by other REITs that do not define the term in accordance with the current NAREIT definition, or that interpret the current NAREIT definition differently than we do. In the future, to the extent that FelCor's FFO, computed in accordance with the NAREIT White Paper, contains gains, losses or other charges that are appropriately identified as non-recurring items, we presently intend to provide, supplemental adjustments to eliminate such non-recurring items and to reflect recurring FFO. -more- FelCor Lodging Trust First Quarter 2003 Operating Results April 30, 2003 Page 7 SELECTED BALANCE SHEET DATA (in thousands)
MARCH 31, DECEMBER 31, 2003 2002 ----------- ----------- Investment in hotels, net of accumulated depreciation $ 4,286,018 $ 4,255,618 Accumulated depreciation (819,094) (782,166) ----------- ----------- Investments in hotels $ 3,466,924 $ 3,473,452 =========== =========== Total cash and cash equivalents $ 155,671 $ 66,542 Total assets 3,872,888 3,780,363 Total debt 2,017,294 1,877,134 Total stockholders' equity $ 1,594,052 $ 1,616,817
### EX-99.2 4 d05367exv99w2.txt FIRST QUARTER 2003 SUPPLEMENTAL INFORMATION EXHIBIT 99.2 [FELCOR LODGING TRUST LOGO] FELCOR LODGING TRUST INCORPORATED SUPPLEMENTAL INFORMATION THREE MONTHS ENDED MARCH 31, 2003 Date of Issuance April 30, 2003 All dollar amounts shown in this report are in U.S. dollars unless otherwise noted. This Supplemental Information is not an offer to sell nor a solicitation to buy any securities of FelCor. Any offers to sell or solicitations to buy any securities of FelCor shall be made by means of a prospectus. TABLE OF CONTENTS
PAGE ---- CORPORATE DATA About the Company 3 Board of Directors and Executive Officers 4 Research Coverage 5 FINANCIAL HIGHLIGHTS Supplemental Financial Data 6 Consolidated Statements of Operations 7 Reconciliation of FFO and EBITDA 8 Selected Operating Data 9 Hotel Operating Expense Composition 9 Debt Summary 10 PORTFOLIO DATA Portfolio Distribution 12 Detailed Operating Statistics by Brand 13 Detailed Operating Statistics for FelCor's Top Markets 14 Other Performance Statistics 15 Hotel Portfolio Information 16 Hotel Portfolio Listing 18
With the exception of historical information, the matters discussed in this supplement include "forward looking statements" within the meaning of the federal securities laws. Forward looking statements are not guarantees of future performance. Numerous risks and uncertainties, and the occurrence of future events, may cause actual results to differ materially from those currently anticipated. General economic conditions, including the timing and magnitude of any recovery from the current soft economy, with the continuing impact of the war in Iraq, future acts of terrorism, the impact of SARS on the travel industry, theavailability of capital, the ability to effect sales of non-strategic hotels at anticipated prices, and numerous other factors may affect future results, performance and achievements. Certain of these risks and uncertainties are described in greater detail in our filings with the Securities and Exchange Commission. Although we believe our current expectations to be based upon reasonable assumptions, we can give no assurance that our expectations will be attained or that actual results will not differ materially. 2 CORPORATE DATA ABOUT THE COMPANY In 1994, FelCor Lodging Trust Incorporated went public as a real estate investment trust (REIT) with six hotels and a market capitalization of $120 million. At March 31, 2003, FelCor was the nation's second largest lodging REIT and the largest owner of full service, all-suite hotels. FelCor's portfolio is comprised of 169 hotels, the operating revenues and expenses of which are reflected in FelCor's consolidated statements of operations because of our ownership of the operating lessees of these hotels. FelCor also owns 50 percent joint venture interests in the operating lessees of 14 hotels whose operations are accounted for using the equity method. FelCor owns 77 upscale, all-suite hotels, 83 hotels in the upscale or full service segments and is the largest owner of Embassy Suites(R) Hotels and Doubletree Guest Suites(R) hotels. The Company's hotels are located in 35 states and Canada. FelCor had a market capitalization of approximately $2.7 billion at March 31, 2003. STRATEGY FelCor's hotels are managed by strategic brand managers such as Hilton Hotels, InterContinental Hotels Group, and Starwood Hotels & Resorts. FelCor is competitively positioned to deliver superior stockholder returns through its strong management team, strategic brand manager alliances, diversified upscale and full-service hotels, value creation expertise, and financial flexibility. STOCK AND DEBT RATINGS
Senior Unsecured Debt Preferred Stock --------------------- --------------- Moody's Ba3 B3 Standard & Poors B+ CCC+
STOCK EXCHANGE LISTING Common (NYSE: FCH) Series A Convertible Preferred (NYSE: FCHPRA) Series B Perpetual Preferred (NYSE: FCHPRB) FISCAL YEAR END December 31 NUMBER OF EMPLOYEES 64 CORPORATE HEADQUARTERS 545 E. John Carpenter Frwy., Suite 1300 Irving, TX 75062 (972) 444-4900 INVESTOR RELATIONS CONTACT MEDIA CONTACT Stephen A. Schafer Monica L. Hildebrand Director of Investor Relations Vice President of Communications (972) 444-4912 (972) 444-4917 INFORMATION REQUEST information@felcor.com 3 BOARD OF DIRECTORS Donald J. McNamara, Chairman of the Board Principal, The Hampstead Group Thomas J. Corcoran, Jr. President and Chief Executive Officer, FelCor Lodging Trust Incorporated Melinda J. Bush, C.H.A. Chairman and Chief Executive Officer, HRW Holdings, LLC Richard S. Ellwood President, R.S. Ellwood and Co., Inc. Richard O. Jacobson Chairman of the Board, Jacobson Warehouse Company, Inc. Charles A. Ledsinger, Jr. President and Chief Executive Officer, Choice Hotels International Robert H. Lutz, Jr. President, RL Investments, Inc. Robert A. Mathewson President, RGC, Inc. Richard C. North Chief Executive Officer, InterContinental Hotels Group Michael D. Rose Chairman, Gaylord Entertainment Company EXECUTIVE OFFICERS Thomas J. Corcoran, Jr., President and Chief Executive Officer Michael A. DeNicola, Executive Vice President and Chief Investment Officer Richard J. O'Brien, Executive Vice President and Chief Financial Officer Lawrence D. Robinson, Executive Vice President, General Counsel and Secretary Jack Eslick, Senior Vice President, Director of Asset Management Lester C. Johnson, Senior Vice President, Controller and Principal Accounting Officer June C. McCutchen, Senior Vice President, Director of Design and Construction Larry J. Mundy, Senior Vice President, Director of Business Initiatives and Assistant General Counsel Andrew J. Welch, Senior Vice President and Treasurer 4 RESEARCH COVERAGE EQUITY
Firm Analyst Telephone - ---- ------- --------- A.G. Edwards & Sons Art Havener (314) 955-3588 Credit Lyonnais Bryan A. Maher (212) 408-5649 Deutsche Bank Marc Falcone (212) 469-7417 Friedman, Billings, Ramsey, & Co. David Loeb (703) 469-1289 Green Street Advisors John Arabia (949) 640-8780 JP Morgan Chase Harry C. Curtis (212) 622-6610 Legg Mason Rod F. Petrik (410) 454-4131 Lehman Brothers Joyce R. Minor (212) 526-5132 Merrill Lynch David W. Anders (212) 449-2739 Morgan Stanley Todd Scott (212) 761-8033 Prudential Securities James W. Sullivan (212) 778-2515 Salomon Smith Barney Michael J. Rietbrock (212) 816-0215 UBS Warburg Keith A. Mills (212) 713-3098 Wachovia Securities Jeffrey J. Donnelly (617) 603-4262
FIXED INCOME
Firm Analyst Telephone - ---- ------- --------- Bank of America Andrew Susser (212) 847-6401 Bear Stearns & Co., Inc. John Mulkey (212) 272-9880 Deutsche Bank Alex. Brown Andrew Zarnett (212) 469-7995 JP Morgan Chase Mark Streeter (212) 834-5086 Lehman Brothers Susan Jansen (212) 526-6470 Salomon Smith Barney Lee Olive (212) 816-8581
5 FINANCIAL HIGHLIGHTS SUPPLEMENTAL FINANCIAL DATA (IN THOUSANDS, EXCEPT PER SHARE INFORMATION, RATIOS AND PERCENTAGES)
Quarter Ended ----------------------------- 3/31/03 12/31/02 ---------- ---------- ENTERPRISE VALUE Common shares outstanding 58,866 58,767 Units not held by FelCor 3,288 3,290 ---------- ---------- Combined shares and units 62,154 62,057 Common stock price at end of period $ 6.23 $ 11.44 ---------- ---------- Common equity capitalization $ 387,219 $ 709,932 ---------- ---------- Series A convertible preferred stock outstanding 5,980 5,980 Series A stock price at end of period $ 16.20 $ 20.85 ---------- ---------- $ 96,876 $ 124,683 ---------- ---------- Series B non-convertible preferred stock outstanding 6,776 6,776 Series B stock price at end of period $ 18.00 $ 24.60 ---------- ---------- $ 121,968 $ 166,689 Consolidated debt 2,017,294 1,877,134 ---------- ---------- Total enterprise value $2,623,357 $2,878,438 ========== ========== DIVIDENDS PER SHARE Common dividends declared, trailing 12 months $ 0.45 $ 0.60 Common dividend yield, trailing 12 months(a) 7.2% 5.2% Dividends declared (quarter ended): Common $ -- $ 0.15 Series A convertible preferred stock 0.4875 0.4875 Series B non-convertible preferred stock 0.5625 0.5625 SELECTED BALANCE SHEET DATA Investment in hotels at cost(b) $4,696,821 $4,661,520 Total cash and cash equivalents 155,671 66,542 Total assets 3,872,888 3,780,363 Total debt 2,017,294 1,877,134 Total stockholders' equity 1,594,052 1,616,817 Total stockholders equity less preferred equity 1,275,145 1,297,910 Book value per common share 21.66 22.08 SELECTED RATIOS Consolidated debt (net of cash) to trailing twelve month EBITDA 6.5x 5.9x Total debt (net of cash) to trailing twelve month EBITDA 7.0x 6.4x Total debt (net of cash) to investment in hotels, at cost 42.7% 41.8% EBITDA to consolidated interest paid(c) 1.8x 1.9x EBITDA to total interest expense(d) 1.7x 1.7x Fixed charge coverage ratio(e) 1.4x 1.5x
(a) Dividend yield represents the trailing 12 month dividends divided by the common stock closing price for the period. (b) Investment in hotels at cost is defined as consolidated investment in hotels before accumulated depreciation, plus our pro rata share of unconsolidated investment in hotels before accumulated depreciation. (c) EBITDA to consolidated interest paid represents trailing twelve month consolidated EBITDA divided by trailing twelve month interest expense before capitalized interest and amortization of debt costs. (d) EBITDA to total interest expense represents trailing twelve month consolidated EBITDA divided by trailing twelve month interest expense including the Company's pro rata share of unconsolidated interest expense. (e) Fixed charges include preferred dividends, consolidated interest expense and interest expense from unconsolidated entities. 6 CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE DATA)
Three Months Ended March 31, --------------------------- 2003 2002 --------- --------- Revenues: Hotel operating revenue: Room $ 242,972 $ 257,230 Food and beverage 47,914 50,691 Other operating departments 16,060 16,219 Retail space rental and other revenue 400 670 --------- --------- Total revenues 307,346 324,810 --------- --------- Expenses: Hotel departmental expenses: Room 63,464 63,233 Food and beverage 38,939 39,991 Other operating departments 7,516 7,316 Other property related costs 91,824 89,160 Management and franchise fees 16,310 15,648 Taxes, insurance and lease expense 32,533 34,570 Corporate expenses 3,423 3,746 Depreciation 36,107 38,618 --------- --------- Total operating expenses 290,116 292,282 --------- --------- Operating income 17,230 32,528 Interest expense, net (40,253) (41,196) Gain on early extinguishment of debt 953 --------- --------- Loss before equity in income (loss) from unconsolidated entities and minority interests (22,070) (8,668) Equity in income (loss) from unconsolidated entities (148) 1,221 Minority interests 1,127 1,301 --------- --------- Net loss (21,091) (6,146) Preferred dividends (6,726) (6,150) --------- --------- Net loss applicable to common stockholders $ (27,817) $ (12,296) ========= ========= Basic and diluted per common share data: -- Net loss applicable to common stockholders $ (0.48) $ (0.23) ========= ========= Weighted average common shares outstanding 58,532 52,717
7 RECONCILIATION OF FFO AND EBITDA (IN THOUSANDS, EXCEPT PER SHARE DATA)
Three Months Ended March 31, ------------------------- 2003 2002 -------- -------- FUNDS FROM OPERATIONS (FFO) Net loss $(21,091) $ (6,146) Depreciation 36,107 38,618 Depreciation from unconsolidated entities 2,859 2,178 Preferred dividends: Series A preferred dividends (2,915) -- Series B preferred dividends (3,811) (3,234) Minority interest in FelCor LP (1,557) (2,087) -------- -------- FFO(a) $ 9,592 $ 29,329 ======== ======== FFO per common share and unit $ 0.15 $ 0.44 ======== ======== Basic and diluted net loss per common share $ (0.48) $ (0.23) ======== ======== Weighted average common shares outstanding 58,532 52,717 Weighted average FelCor LP units outstanding 3,289 9,005 Conversion of Series A preferred shares -- 4,636 Conversion of options and stock grants 309 357 -------- -------- Weighted average common shares and units outstanding 62,130 66,715 ======== ======== EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION (EBITDA) FFO $ 9,592 $ 29,329 Interest expense 40,628 41,775 Interest expense from unconsolidated entities 2,339 2,359 Amortization expense 516 509 Preferred dividends: Series A preferred dividends 2,915 -- Series B preferred dividends 3,811 3,234 -------- -------- EBITDA(a) $ 59,801 $ 77,206 ======== ========
(a) Includes a $953,000 gain on early extinguishment of debt. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminish predictably over time. Since real estate values instead have historically risen or fallen with market conditions, most industry investors consider supplemental measurements of performance to be helpful in evaluating a real estate company's operations. We consider FFO and EBITDA to be key measures of a REIT's performance and should be considered along with, but not as an alternative to, net income and cash flow as a measure of our operating performance. The White Paper on Funds From Operations approved by the Board of Governors of the National Association of Real Estate Investment Trusts ("NAREIT") defines FFO as net income or loss (computed in accordance with generally accepted accounting principles), excluding gains or losses from sales of property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures are calculated to reflect funds from operations on the same basis. We believe that FFO and EBITDA are helpful to investors as a measure of the performance of an equity REIT. We compute FFO in accordance with standards established by NAREIT. This may not be comparable to FFO reported by other REITs that do not define the term in accordance with the current NAREIT definition, or that interpret the current NAREIT definition differently than we do. In the future, to the extent that FelCor's FFO, computed in accordance with the NAREIT White Paper, contains gains, losses or other charges that are appropriately identified as non-recurring items, it presently intends to provide, supplemental adjustments to eliminate such non-recurring items and to reflect recurring FFO. 8 SELECTED OPERATING DATA (DOLLARS IN THOUSANDS)
Three Months Ended March 31, ---------------------------- 2003 2002 --------- --------- Total revenue $ 307,346 $ 324,810 Retail space and other revenue (400) (670) --------- --------- Hotel revenues 306,946 324,140 Hotel operating expenses (218,053) (215,348) --------- --------- Hotel operating margin ($) $ 88,893 $ 108,792 ========= ========= Operating margin (%) 29.0% 33.6% Corporate expenses 3,423 3,746 Corporate expenses as a percentage of revenues 1.1% 1.2%
HOTEL OPERATING EXPENSE COMPOSITION (DOLLARS IN THOUSANDS)
Three Months Ended March 31, ------------------------------------------------------- 2003 2002 ----------------------- ----------------------- Room $ 63,464 29.1% $ 63,233 29.4% Food and beverage 38,939 17.9 39,991 18.6 Other operating departments 7,516 3.4 7,316 3.4 Other property related costs: Administrative and general 30,344 13.9 31,204 14.5 Marketing and advertising 27,746 12.7 26,545 12.3 Repairs and maintenance 17,797 8.2 16,798 7.8 Energy 15,937 7.3 14,613 6.8 --------- ----- --------- ----- Total other property related costs 91,824 42.1 89,160 41.4 --------- --------- Management and franchise fees 16,310 7.5 15,648 7.2 --------- ----- --------- ----- Hotel operating expenses $ 218,053 100.0% $ 215,348 100.0% ========= ===== ========= ===== Supplemental information: Compensation and benefits expense (included in hotel operating expenses) $ 103,431 $ 100,958 ========= ========= Reconciliation of hotel operating expense: Total operating expenses $ 290,116 $ 292,282 Taxes, insurance and lease expense (32,533) (34,570) Corporate expenses (3,423) (3,746) Depreciation (36,107) (38,618) --------- --------- Hotel operating expenses $ 218,053 $ 215,348 ========= =========
9 DEBT SUMMARY (DOLLARS IN THOUSANDS) Debt Outstanding
Encumbered Interest Rate At Maturity Hotels March 31, 2003 Date Balance ---------- ---------------- -------- --------- Unsecured line of credit none 4.55% Oct. 2004 $ 149,497(a) Promissory note none 3.34 June 2016 650 Senior unsecured term notes none 4.50(b) Oct. 2004 174,792 Senior unsecured term notes none 5.37(c) Oct. 2007 75,000 Senior unsecured term notes none 7.63 Oct. 2007 49,543 Senior unsecured term notes none 9.50 Sept. 2008 596,363 Senior unsecured term notes none 8.50 June 2011 297,969 Mortgage debt 15 hotels 7.24 Nov. 2007 133,970 Mortgage debt 7 hotels 7.54 April 2009 93,840 Mortgage debt 6 hotels 7.55 June 2009 70,604 Mortgage debt 8 hotels 8.70 May 2010 179,890 Mortgage debt 7 hotels 8.73 May 2010 139,803 Mortgage debt 5 hotels 7.20 2005-2008 48,338 Other 1 hotel 9.08 2011 7,035 --------- ---- ---------- Total 49 hotels 7.86% $2,017,294 ==========
(a) In the second quarter of 2003, the Company used the proceeds of its new secured non-recourse loan to repay all balances under its line of credit and subsequently reduced its line of credit commitments to $150 million. (b) Represents fixed to floating interest rate swaps at six month LIBOR plus 320 basis points. (c) Represents fixed to floating interest rate swaps at six month LIBOR plus 407 basis points. FelCor's fixed to floating interest rate swaps reduced interest expense for the quarter by $1.6 million. Fixed interest rate debt to total debt 80% Weighted average maturity of debt 5.7 years Secured debt to total assets 17.4%
At March 31, 2003, future scheduled debt principal payments are as follows (in thousands):
Secured Unsecured Year Debt Debt Total - ---- ------- --------- ----- 2003 $ 10,078 $ -- $ 10,078 2004 14,083 324,497(a) 338,580 2005 41,103 -- 41,103 2006 13,978 -- 13,978 2007 132,990 125,000 257,990 2008 and thereafter 459,008 900,650 1,359,658 Premium/(discount) 2,240 (6,333) (4,093) -------- ---------- ---------- Total debt $673,480 $1,343,814 $2,017,294 ======== ========== ==========
10 (a) Includes $149 million under our line of credit, that was paid off in the second quarter of 2003, with secured debt maturing in May 2006. 11 DEBT SUMMARY (CONTINUED) At March 31, 2003, FelCor had unconsolidated 50 percent investments in ventures that owned an aggregate of 29 hotels. These ventures had approximately $267 million of non-recourse mortgage debt, all of which is secured by hotel assets. Additionally, one joint venture had a full recourse loan for a residential condominium development. FelCor's pro rata share of this recourse loan was $9.2 million at March 31, 2003. In the first quarter of 2003, we refinanced $16 million of secured debt that was to mature in the fourth quarter of 2003. The loan was refinanced by the existing lender, effective August 2003, for a five-year period at a floating interest rate of LIBOR plus 285 basis points with no required amortization. Another secured loan, maturing in 2003, in the amount of $6 million was prepaid in the first quarter of 2003. In conjunction with this $6 million early retirement of debt, we recognized a $1 million gain related to the unamortized premium on this debt. In April 2003, we closed on a new $150 million non-recourse loan at a floating interest rate of LIBOR plus 250 basis points secured by 10 of our hotels and maturing in May 2006, with two one year extension options. The proceeds of the debt were used to pay off the outstanding balance on our line of credit. 12 PORTFOLIO DATA (169 CONSOLIDATED HOTELS, SAME STORE BASIS) PORTFOLIO DISTRIBUTION
% of % of Total 2002 Brand Hotels Rooms Rooms EBITDA - ----- ------ ----- ----- ------ Embassy Suites 59 14,842 32% 42% Holiday Inn(R)-branded 53 16,019 34 26 Crowne Plaza(R) 18 5,963 13 11 Sheraton(R)-branded 10 3,269 7 8 Doubletree(R)-branded 13 2,675 6 6 Other 16 3,673 8 7 % of % of Total 2002 Top Markets Hotels Rooms Rooms EBITDA - ----------- ------ ----- ----- ------ Atlanta 10 3,061 7% 8% Dallas 17 5,273 11 7 San Francisco Bay Area 9 3,255 7 5 New Orleans 2 746 2 4 Orlando 6 2,220 5 4 Philadelphia 3 1,174 3 4 Houston 5 1,696 4 3 Phoenix 4 1,027 2 3 Minneapolis 4 955 2 3 Chicago 4 1,239 3 3 % of % of Total 2002 Top Four States Hotels Rooms Rooms EBITDA - --------------- ------ ----- ----- ------ California 19 6,026 13% 19% Texas 36 10,366 22 16 Florida 16 5,346 12 12 Georgia 12 3,415 7 9 % of % of Total 2002 Location Hotels Rooms Rooms EBITDA - -------- ------ ----- ----- ------ Suburban 79 19,615 42% 43% Urban 31 10,483 23 27 Airport 33 9,711 21 21 Highway 14 2,954 6 3 Resort 12 3,678 8 6 % of % of Total 2002 Segment Hotels Rooms Rooms EBITDA - ------- ------ ----- ----- ------ Upscale all-suite 77 18,357 39% 52% Full service 55 17,088 37 29 Upscale 28 9,667 21 18 Limited service 9 1,329 3 2 % of % of Total 2002 Hotels Rooms Rooms EBITDA ------ ----- ----- ------ Potential Sale Candidates 33 6,468 14% 7%
13 DETAILED OPERATING STATISTICS BY BRAND
Occupancy (%) -------------------------------- Three Months Ended March 31, -------------------------------- 2003 2002 % Variance ---- ---- ---------- Embassy Suites hotels 66.7 66.5 0.3 Holiday Inn-branded hotels 58.2 59.3 (1.8) Crowne Plaza hotels 55.4 56.8 (2.4) Doubletree-branded hotels 64.8 60.4 7.3 Sheraton-branded hotels 58.9 56.4 4.4 Other hotels 45.5 54.2 (16.1) Total hotels 60.0 60.7 (1.2)
ADR ($) --------------------------------- Three Months Ended March 31, --------------------------------- 2003 2002 % Variance ------ ------ ---------- Embassy Suites hotels 119.18 124.89 (4.6) Holiday Inn-branded hotels 77.25 80.37 (3.9) Crowne Plaza hotels 89.36 94.04 (5.0) Doubletree-branded hotels 100.72 105.23 (4.3) Sheraton-branded hotels 98.40 104.89 (6.2) Other hotels 84.08 86.45 (2.7) Total hotels 96.92 101.05 (4.1)
RevPAR ($) -------------------------------- Three Months Ended March 31, -------------------------------- 2003 2002 % Variance ----- ----- ---------- Embassy Suites hotels 79.49 83.06 (4.3) Holiday Inn-branded hotels 44.95 47.62 (5.6) Crowne Plaza hotels 49.52 53.40 (7.3) Doubletree-branded hotels 65.27 63.54 2.7 Sheraton-branded hotels 57.98 59.20 (2.1) Other hotels 38.27 46.90 (18.4) Total hotels 58.13 61.36 (5.3)
14 DETAILED OPERATING STATISTICS FOR FELCOR'S TOP MARKETS
Occupancy (%) ------------------------------- Three Months Ended March 31, ------------------------------- 2003 2002 % Variance ---- ---- ---------- Atlanta 67.1 70.1 (4.3) Dallas 45.7 51.7 (11.6) San Francisco Bay Area 59.8 58.2 2.7 New Orleans 62.2 73.5 (15.4) Orlando 65.7 69.5 (5.5) Philadelphia 52.6 53.8 (2.3) Houston 62.6 69.7 (10.2) Phoenix 80.5 71.9 11.8 Minneapolis 59.6 59.2 0.7 Chicago 58.3 53.2 9.7
ADR ($) --------------------------------- Three Months Ended March 31, --------------------------------- 2003 2002 % Variance ------ ------ ---------- Atlanta 88.96 95.28 (6.6) Dallas 86.95 93.12 (6.6) San Francisco Bay Area 108.41 119.22 (9.1) New Orleans 156.18 165.08 (5.4) Orlando 83.48 89.60 (6.8) Philadelphia 99.47 110.53 (10.0) Houston 74.21 76.23 (2.7) Phoenix 128.61 138.17 (6.9) Minneapolis 119.86 121.72 (1.5) Chicago 101.30 112.38 (9.9)
RevPAR ($) -------------------------------- Three Months Ended March 31, -------------------------------- 2003 2002 % Variance ----- ------ ---------- Atlanta 59.66 66.75 (10.6) Dallas 39.71 48.14 (17.5) San Francisco Bay Area 64.85 69.44 (6.6) New Orleans 97.12 121.31 (19.9) Orlando 54.87 62.30 (11.9) Philadelphia 52.34 59.51 (12.0) Houston 46.44 53.16 (12.6) Phoenix 103.49 99.40 4.1 Minneapolis 71.42 72.00 (0.8) Chicago 59.07 59.76 (1.1)
15 OTHER PERFORMANCE STATISTICS VARIANCE TO PRIOR YEAR
Occupancy ADR RevPAR % Variance % Variance % Variance ---------- ---------- ---------- First Quarter 2001 (1.7) 3.6 1.8 Second Quarter 2001 (7.2) (0.2) (7.4) Third Quarter 2001 (13.4) (4.8) (17.5) Fourth Quarter 2001 (15.2) (9.5) (23.3) Year 2001 (9.3) (2.4) (11.5) First Quarter 2002 (11.2) (7.8) (18.2) Second Quarter 2002 (5.1) (6.3) (11.1) Third Quarter 2002 2.4 (4.8) (2.4) Fourth Quarter 2002 4.4 (1.3) 3.1 Year 2002 (2.8) (5.5) (8.1) January 0.3 (3.8) (3.6) February (1.4) (4.4) (5.8) March(a) (2.2) (4.0) (6.1) First Quarter 2003 (1.2) (4.1) (5.3) April 2003 estimate(a) (10.5) to (11.5)
(a) Includes the lack of comparability due to the occurrence of Easter in April 2003, as compared to March in 2002. 16 HOTEL PORTFOLIO INFORMATION PRO RATA SHARE OF ROOMS OWNED
Room Count -------------- March 31, 2003 Hotels Total hotels 183 48,825 ------ 50% joint ventures 29 (3,137) 60% joint ventures 2 (390) 90% joint ventures 6 (148) 97% joint venture 1 (10) ------ Total joint venture owned rooms (3,685) ------ Pro rata share of rooms owned 45,140 ======
CAPITAL EXPENDITURES (DOLLARS IN THOUSANDS)
Three Months Ended Year Ended March 31, 2003 December 31, 2002 -------------- ----------------- Consolidated hotels: Improvements and additions to hotels $24,614 $62,518 % of total revenue 8.0% 4.7% Unconsolidated hotels (pro rata share): Improvements and additions to hotels(a) $ 1,271 $ 8,580 % of total revenue 12.0% 10.5%
(a) Excludes $6.9 million of capital expenditures during the three months ended March 31, 2003, incurred by our joint venture for construction of a residential condominium project. The funds for this project are funded by secured debt. 17 HOTEL PORTFOLIO INFORMATION POTENTIAL SALE CANDIDATES In February 2003, FelCor identified 33 non-strategic hotels that it intends to sell over the next 36 months. These hotels are generally smaller hotels in secondary and tertiary markets, and certain hotels in Texas and specifically, Dallas. There are 26 hotels managed by InterContinental Hotels Group (IHG) (primarily Holiday Inn), six hotels managed by Hilton, and one hotel managed by an independent company. The 2002 RevPAR for these hotels was $39, occupancy was 54 percent, and the ADR was $74. FelCor has announced the selected brokers to market 27 of these hotels. A detailed description of these hotels and listing of brokers can be found on FelCor's Web site at www.felcor.com on the `Hotels' page. For the hotels managed by IHG, FelCor is required to reinvest the proceeds from such sales in IHG-branded hotels (i.e., Intercontinental(R), Holiday Inn-branded hotels, Crowne Plaza, or Staybridge Suites(R)) under its pooled management agreement. PORTFOLIO CHANGES IN 2002 Hotel Dispositions: - In the third quarter of 2002, FelCor sold its 71-room Holiday Inn in Colby, Kansas, for net cash proceeds of $1.7 million. - In the third quarter of 2002, FelCor sold four Holiday Inn-branded hotels and one Hampton Inn(R) hotel in Kansas to a new joint venture, and received as consideration $4.4 million in cash, a preferred right to receive $6 million, and a 50 percent common equity interest in the venture. - In the second quarter of 2002, FelCor sold the 183-room Doubletree Guest Suites in Boca Raton, Florida, for net proceeds of $6.5 million. Hotel Acquisitions: - Purchased the 208-room SouthPark Suites in Charlotte, North Carolina, in July 2002. This hotel was converted to a Doubletree Guest Suites hotel in October 2002. - Purchased the 385-room Wyndham(R) Myrtle Beach Resort and the Acadian Shores Golf Club in Myrtle Beach, South Carolina, in July 2002. PORTFOLIO CHANGES IN 2003 - Converted an independent all-suite hotel in Dallas to a Staybridge Suites hotel in March 2003. - In April, FelCor completed the conversion of the 385-room Hilton Myrtle Beach Resort, following a $15 million renovation of the former Wyndham-affiliated property. 18 HOTEL PORTFOLIO LISTING
% Owned Hotel State Rooms (a) Brand - ----- ----- ----- ----- ----- CONSOLIDATED OPERATIONS CORE HOTELS Birmingham AL 242 Embassy Suites Montgomery (East I-85) AL 213 Holiday Inn Phoenix (Camelback) AZ 232 Embassy Suites Phoenix (Crescent) AZ 342 Sheraton Tempe (ASU) AZ 224 Embassy Suites Anaheim (Disney Area) CA 222 Embassy Suites Burlingame (SF-Airport South) CA 340 Embassy Suites Covina (I-10) CA 259 50% Embassy Suites Dana Point - Doheny Beach CA 195 Doubletree Guest Suites El Segundo (LAX-Airport South) CA 349 97% Embassy Suites Irvine (Orange County Airport) CA 335 Crowne Plaza Milpitas CA 266 Embassy Suites Milpitas (San Jose-North) CA 305 Crowne Plaza Napa CA 205 Embassy Suites Oxnard (Mandalay Beach Resort) CA 248 Embassy Suites Palm Desert CA 198 Embassy Suites Pleasanton CA 244 Crowne Plaza Santa Barbara CA 160 Holiday Inn San Diego (On the Bay) CA 600 Holiday Inn San Francisco (Financial District) CA 565 Holiday Inn San Francisco (Fisherman's Wharf) CA 585 Holiday Inn San Francisco (SF-Airport North) CA 312 Embassy Suites San Francisco (Union Square) CA 403 Crowne Plaza San Rafael (Marin County) CA 235 50% Embassy Suites Aurora (Denver-Southeast) CO 248 90% Doubletree Hartford (Downtown) CT 350 Crowne Plaza Stamford CT 383 Holiday Inn Select(R) Wilmington DE 244 90% Doubletree Boca Raton FL 263 Embassy Suites Cocoa Beach (Oceanfront Resort) FL 500 Holiday Inn Deerfield Beach FL 244 Embassy Suites Ft. Lauderdale FL 358 Embassy Suites Ft. Lauderdale (Cypress Creek) FL 253 Sheraton Suites Jacksonville FL 277 Embassy Suites Kissimmee (Nikki Bird Resort) FL 530 Holiday Inn Miami (Airport) FL 304 Crowne Plaza Miami (Airport) FL 316 Embassy Suites Lake Buena Vista (Walt Disney World) FL 229 Doubletree Guest Suites
(a) 100% of real estate interests are owned by FelCor unless otherwise noted. 19 HOTEL PORTFOLIO LISTING
% Owned Hotel State Rooms (a) Brand - ----- ----- ----- ----- ----- Orlando (Airport) FL 288 Holiday Inn Select Orlando (International Drive Resort) FL 652 Holiday Inn Orlando (North) FL 277 Embassy Suites Orlando (South) FL 244 Embassy Suites Tampa (Near Busch Gardens) FL 408 Holiday Inn Tampa (Rocky Point) FL 203 Doubletree Guest Suites Atlanta (Airport) GA 378 Crowne Plaza Atlanta (Airport) GA 233 Embassy Suites Atlanta (Airport-Gateway) GA 395 Sheraton Atlanta (Airport-North) GA 493 Holiday Inn Atlanta (Buckhead) GA 317 Embassy Suites Atlanta (Galleria) GA 278 Sheraton Suites Atlanta (Jonesboro South) GA 180 Holiday Inn Atlanta (Perimeter Center) GA 241 50% Embassy Suites Atlanta (Perimeter-Dunwoody) GA 250 Holiday Inn Select Atlanta (Powers Ferry) GA 296 Crowne Plaza Brunswick GA 130 Embassy Suites Columbus (Airport-North) GA 224 Holiday Inn Chicago (Allerton) IL 443 Crowne Plaza Chicago (Lombard) IL 262 50% Embassy Suites Chicago (O'Hare) IL 297 Sheraton Suites Deerfield IL 237 Embassy Suites Indianapolis (North) IN 221 50% Embassy Suites Overland Park KS 199 50% Embassy Suites Lexington KY 174 Hilton Suites(R) Lexington KY 155 Sheraton Suites Baton Rouge LA 223 Embassy Suites New Orleans LA 372 Embassy Suites New Orleans (French Quarter) LA 374 Holiday Inn Boston (Government Center) MA 303 Holiday Inn Select Boston (Marlborough) MA 229 Embassy Suites Baltimore (BWI Airport) MD 251 90% Embassy Suites Troy MI 251 90% Embassy Suites Bloomington MN 219 Embassy Suites Minneapolis (Airport) MN 310 Embassy Suites Minneapolis (Downtown) MN 216 Embassy Suites St. Paul MN 210 Embassy Suites Kansas City (Country Club Plaza) MO 266 50% Embassy Suites Kansas City (Northeast) MO 167 Holiday Inn St. Louis (Downtown) MO 297 Embassy Suites St. Louis (Westport) MO 316 Holiday Inn Olive Branch (Whispering Woods Hotel and MS 181 Independent Conference Center) Charlotte NC 274 50% Embassy Suites Charlotte (SouthPark) NC 208 Doubletree Guest Suites
(a) 100% of real estate interests are owned by FelCor unless otherwise noted. 20 HOTEL PORTFOLIO LISTING
% Owned Hotel State Rooms (a) Brand - ----- ----- ----- ----- ----- Raleigh NC 225 50% Embassy Suites Raleigh NC 203 Doubletree Guest Suites Omaha (Central) NE 131 Hampton Inn Omaha (I-80) NE 383 Holiday Inn Omaha (Old Mill Northwest) NE 223 Crowne Plaza Omaha (Southwest) NE 108 Homewood Suites Parsippany NJ 274 50% Embassy Suites Piscataway NJ 224 Embassy Suites Secaucus (Meadowlands) NJ 304 Crowne Plaza Secaucus (Meadowlands) NJ 261 50% Embassy Suites Albuquerque (Mountain View) NM 360 Holiday Inn Cleveland OH 268 Embassy Suites Tulsa OK 244 Embassy Suites Philadelphia (Center City) PA 445 Crowne Plaza Philadelphia (Historic District) PA 364 Holiday Inn Philadelphia (Society Hill) PA 365 Sheraton Pittsburgh PA 251 Holiday Inn Select Charleston (Mills House) SC 214 Holiday Inn Myrtle Beach (Kingston Plantation) SC 255 Embassy Suites Myrtle Beach (b) SC 385 Wyndham Knoxville (Central) TN 240 Holiday Inn Nashville TN 296 Embassy Suites Nashville (Opryland/Airport) TN 382 Holiday Inn Select Austin (Airport-North) TX 260 50% Embassy Suites Austin (Downtown) TX 189 90% Doubletree Guest Suites Austin (Town Lake) TX 320 Holiday Inn Corpus Christi TX 150 Embassy Suites Dallas (Alpha Road) TX 114 Staybridge Suites Dallas (Campbell Centre) TX 300 90% Doubletree Dallas (DFW Airport-North - Irving) TX 506 Harvey(R)Hotel Dallas (DFW Airport-North - Irving) TX 164 Harvey Suites(R) Dallas (DFW Airport-South - Irving) TX 305 Embassy Suites Dallas (Downtown-West End) TX 311 Hampton Inn Dallas (Love Field) TX 248 Embassy Suites Dallas (Market Center) TX 244 Embassy Suites Dallas (Park Central) TX 295 Crowne Plaza Suites(R) Dallas (Park Central) TX 279 Embassy Suites Dallas (Park Central) TX 438 60% Sheraton Dallas (Park Central) TX 536 60% Westin Houston (I-10 West) TX 349 Holiday Inn Select Houston (International Airport) TX 415 Holiday Inn Houston (Medical Center) TX 293 Crowne Plaza Houston (Medical Center) TX 284 Holiday Inn & Suites Houston (Near Gateway Plaza) TX 355 Holiday Inn Select Plano TX 160 Holiday Inn
(a) 100% of real estate interests are owned by FelCor unless otherwise noted. (b) Converted to a Hilton hotel in April 2003. 21 HOTEL PORTFOLIO LISTING
% Owned Hotel State Rooms (a) Brand - ----- ----- ----- ----- ----- San Antonio (Airport) TX 261 50% Embassy Suites San Antonio (Downtown) TX 315 Holiday Inn San Antonio (International Airport) TX 397 Holiday Inn Select San Antonio (Northwest) TX 216 50% Embassy Suites Salt Lake City (Airport) UT 191 Holiday Inn Burlington VT 309 Sheraton Vienna (Tysons Corner) VA 437 50% Sheraton Premiere Canada Toronto (Airport) Ontario 445 Holiday Inn Select Toronto (Yorkdale) Ontario 370 Holiday Inn NON-STRATEGIC HOTELS Texarkana (I-30) AR 210 Holiday Inn Flagstaff AZ 119 Embassy Suites Phoenix (Airport - 44th St) AZ 229 Embassy Suites Avon (Beaver Creek Resort) CO 72 Independent Moline IL 138 Hampton Inn Moline (Airport) IL 216 Holiday Inn Moline (Airport) IL 110 Holiday Inn Express Davenport IA 132 Hampton Inn Davenport IA 279 Holiday Inn Jackson (Downtown) MS 354 Crowne Plaza Jackson (North) MS 222 Holiday Inn & Suites(R) Omaha NE 187 Doubletree Guest Suites Omaha (Southwest) NE 131 Hampton Inn Omaha (Southwest) NE 78 Holiday Inn Express & Suites(R) Syracuse NY 215 Embassy Suites Columbus OH 194 Doubletree Guest Suites Dayton OH 137 Doubletree Guest Suites Greenville (Roper) SC 208 Crowne Plaza Nashville (Airport) TN 138 Doubletree Guest Suites Addison (North Dallas) TX 429 Crowne Plaza Amarillo (I-40) TX 248 Holiday Inn Beaumont (Midtown I-10) TX 190 Holiday Inn Dallas (Market Center) TX 354 Crowne Plaza Dallas (Park Central) TX 313 Harvey Hotel Midland (Country Villa) TX 250 Holiday Inn Odessa (Centre) TX 186 Holiday Inn Express & Suites Odessa (Parkway Blvd) TX 245 Holiday Inn & Suites Plano TX 279 Harvey Hotel Waco (I-35) TX 170 Holiday Inn Canada Cambridge Ontario 143 Holiday Inn Kitchener (Waterloo) Ontario 182 Holiday Inn Peterborough (Waterfront) Ontario 153 Holiday Inn Sarnia Ontario 151 Holiday Inn
(a) 100% of real estate interests are owned by FelCor unless otherwise noted. 22 HOTEL PORTFOLIO LISTING
% Owned Hotel State Rooms (a) Brand - ----- ----- ----- ----- ----- UNCONSOLIDATED OPERATIONS Scottsdale (Downtown) AZ 218 50% Fairfield Inn(R) Atlanta (Downtown) GA 211 50% Courtyard by Marriott(R) Atlanta (Downtown) GA 242 50% Fairfield Inn Great Bend KS 174 50% Holiday Inn Hays KS 117 50% Hampton Inn Hays KS 191 50% Holiday Inn Salina KS 195 50% Holiday Inn Salina (I-70) KS 93 50% Holiday Inn Express & Suites New Orleans (Chateau LeMoyne) LA 171 50% Holiday Inn Dallas (Regal Row) TX 204 50% Fairfield Inn Houston (I-10 East) TX 160 50% Fairfield Inn Houston (I-10 East) TX 90 50% Hampton Inn Houston (Near the Galleria) TX 209 50% Courtyard by Marriott Houston (Near the Galleria) TX 107 50% Fairfield Inn
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