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Replies to post #120 on W2007 Grace Acquisition I, Inc. (fka WGCBP)
06/04/14 7:33 AM
9. SUBSEQUENT EVENTS:
On April 11, 2014, the Company refinanced the GE Mortgage with a new $976 million loan originated by German American Capital Corporation (the GACC Loan). It is anticipated that GSMC will purchase 40% of the GACC Loan prior to its securitization. The GACC Loan bears interest at 30-day LIBOR plus 3.30% with interest only due monthly in arrears and matures in May 2016. The GACC Loan has three one-year extension options available upon the satisfaction of certain conditions, the most restrictive of which is a debt yield test.
In connection with the refinancing of the GE Mortgage, the “cash trap” under the GE Mortgage and the cash flow pledge of the 20 hotels which are not collateral on the GE Mortgage ceased.
Also on April 11, 2014, WNT exercised the Purchase Option in connection with the refinancing of the GE Mortgage. As a result, effective April 11, 2014, the Company will deconsolidate the 106 hotels and recognize its 3% interest in the hotels using the equity method.
On May 23, 2014, subsidiaries of the Company and WNT entered into an agreement to sell their 126 hotels for a combined purchase price of $1.925 billion, subject to certain adjustments, to affiliates of ARC Hospitality. ARC Hospitality is expected to assume the GACC Loan and the remaining 20 hotels will be delivered unencumbered by any financing. Additionally, the selling subsidiaries have agreed to provide seller financing in certain circumstances.
The closing of the acquisition is subject to customary franchisor and lender approvals as well as other usual closing conditions and is expected to close in the fourth quarter of 2014. There can be no assurance that the transaction will close as scheduled, or at all.
10/21/14 9:03 AM
