DiamondRock Hospitality Co

Previous wording

This report contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and includes this statement for purposes of complying with these safe harbor provisions. These forward-looking statements are generally identifiable by use of the words “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project” or similar expressions, whether in the negative or affirmative. Forward-looking statements are based on management’s current expectations and assumptions and are not guarantees of future performance. Factors that may cause actual results to differ materially from current expectations include, but are not limited to, the risks discussed herein and the risk factors discussed from time to time in our periodic filings with the Securities and Exchange Commission, including in Part I, Item 1A “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2023 as updated by our subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Accordingly, there is no assurance that the Company’s expectations will be realized. Except as otherwise required by the federal securities laws, the Company disclaims any obligations or undertaking to publicly release any updates or revisions to any forward-looking statement contained in this report to reflect events, circumstances or changes in expectations after the date of this report.

Current wording

This report contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and includes this statement for purposes of complying with these safe harbor provisions. These forward-looking statements are generally identifiable by use of the words “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project” or similar expressions, whether in the negative or affirmative. Forward-looking statements are based on management’s current expectations and assumptions and are not guarantees of future performance. Factors that may cause actual results to differ materially from current expectations include, but are not limited to, the risks discussed herein and the risk factors discussed from time to time in our periodic filings with the Securities and Exchange Commission, including in Part I, Item 1A “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2023 as updated by our subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Accordingly, there is no assurance that the Company’s expectations will be realized. Except as otherwise required by the federal securities laws, the Company disclaims any obligations or undertaking to publicly release any updates or revisions to any forward-looking statement contained in this report to reflect events, circumstances or changes in expectations after the date of this report.

Previous wording

•risks and uncertainties affecting hotel management, operations and renovations (including, without limitation, elevated inflation, construction delays, increased construction costs, disruption in hotel operations and the risks associated with our management and franchise agreements);

Current wording

•risks and uncertainties affecting hotel management, operations and renovations (including, without limitation, elevated inflation, construction delays, increased construction costs, disruption in hotel operations and the risks associated with our management and franchise agreements and our reliance on third-party managers);

Previous wording

Our strategy is to apply aggressive asset management, prudent financial strategy, and disciplined capital allocation to high quality lodging properties in North American urban and resort markets with superior growth prospects and high barriers-to-entry. Our goal is to deliver long-term stockholder returns that exceed those generated by our peers through a combination of dividends and enduring capital appreciation.

Current wording

Our strategy is to apply aggressive asset management, prudent financial strategy, and disciplined capital allocation to high quality lodging properties in urban and resort markets in the U.S. with superior growth prospects and high barriers-to-entry. Our goal is to deliver long-term stockholder returns that exceed those generated by our peers through a combination of dividends and enduring capital appreciation.

Previous wording

Our revenue is primarily derived from hotel operations, including rooms revenue, food and beverage revenue and other revenue, which consists of parking, spa, resort fees, other guest services, and tenant leases, among other items.

Current wording

Our revenue is primarily derived from hotel operations, including but not limited to rooms revenue, food and beverage revenue and other revenue, which consists of parking, spa, resort fees, other guest services, and tenant leases.

Previous wording

We use a variety of operating and other information to evaluate the financial condition and operating performance of our business. These key indicators include financial information that is prepared in accordance with U.S. Generally Accepted Accounting Principles (“U.S. GAAP”), as well as other financial information that is not prepared in accordance with U.S. GAAP. In addition, we use other information that may not be financial in nature, including statistical information and comparative data. We use this information to measure the performance of individual hotels, groups of hotels and/or our

Current wording

We use a variety of operating and other information to evaluate the financial condition and operating performance of our business. These key indicators include financial information that is prepared in accordance with U.S. Generally Accepted Accounting Principles (“U.S. GAAP”), as well as other financial information that is not prepared in accordance with U.S. GAAP. In addition, we use other information that may not be financial in nature, including statistical information and comparative data. We use this information to measure the performance of individual hotels, groups of hotels and/or our business as a whole. We periodically compare historical information to our internal budgets as well as industry-wide information. These key indicators include:

Previous wording

Occupancy, ADR and RevPAR are commonly used measures within the hotel industry to evaluate operating performance. RevPAR, which is calculated as the product of ADR and occupancy percentage, is an important statistic for monitoring operating performance at the individual hotel level and across our business as a whole. We evaluate individual hotel RevPAR performance on an absolute basis with comparisons to budget and prior periods, as well as on a company-wide and regional basis. ADR and RevPAR include only room revenue. Room revenue comprised approximately 65% of our total revenues for the six months ended June 30, 2024 and is dictated by demand, as measured by occupancy percentage, pricing, as measured by ADR, and our available supply of hotel rooms.

Current wording

Occupancy, ADR and RevPAR are commonly used measures within the hotel industry to evaluate operating performance. RevPAR, which is calculated as the product of ADR and occupancy percentage, is an important statistic for monitoring operating performance at the individual hotel level and across our business as a whole. We evaluate individual hotel RevPAR performance on an absolute basis with comparisons to budget and prior periods, as well as on a company-wide and regional basis. ADR and RevPAR include only room revenue. Room revenue comprised approximately 66% of our total revenues for the nine months ended September 30, 2024 and is dictated by demand, as measured by occupancy percentage, pricing, as measured by ADR, and our available supply of hotel rooms.

Previous wording

The following tables set forth certain operating information for the six months ended June 30, 2024 for each of our hotels owned during the period.

Current wording

The following tables set forth certain operating information for the nine months ended September 30, 2024 for each of our hotels owned during the period.

Previous wording

At June 30, 2024 and 2023, we owned 36 and 35 hotels, respectively. All properties owned during these periods have been included in our results of operations during the respective periods since their date of acquisition. Based on when a property was acquired, operating results for certain properties are not comparable for the three and six months ended June 30, 2024 and 2023. The property detailed in the table below is hereinafter referred to as a “non-comparable property” and all other properties are referred to as “comparable properties”:

Current wording

At September 30, 2024 and 2023, we owned 36 hotels. All properties owned during these periods have been included in our results of operations during the respective periods since their date of acquisition. Based on when a property was acquired, operating results for certain properties are not comparable for the three and nine months ended September 30, 2024 and 2023. The property detailed in the table below is hereinafter referred to as the “non-comparable property” and all other properties are referred to as “comparable properties”:

Previous wording

Rooms revenues increased by $6.2 million from the three months ended June 30, 2023 to the three months ended June 30, 2024, $1.5 million of which was due to the acquisition of the non-comparable property. The remaining increase of $4.7 million was the result of improved occupancy at our resort hotels and increased ADR at our urban hotels.

Current wording

Rooms revenues increased by $6.1 million from the three months ended September 30, 2023 to the three months ended September 30, 2024, $0.6 million of which was due to the acquisition of the non-comparable property. The remaining increase of $5.5 million was the result of improved occupancy at our resort hotels and increased ADR at our urban hotels.

Previous wording

Food and beverage revenues increased $18.3 million from the six months ended June 30, 2023 to the six months ended June 30, 2024, $3.0 million of which was due to the acquisition of the non-comparable property. The remaining increase was primarily due to increases in both banquet revenues and audio visual revenues, driven by an increase in group business during the period.

Current wording

Food and beverage revenues increased $1.1 million from the three months ended September 30, 2023 to the three months ended September 30, 2024, $0.7 million of which was due to the acquisition of the non-comparable property. The remaining increase was primarily due to slight increases in banquet and outlet revenues.

Previous wording

Other revenues, which primarily represent spa, parking, resort fees and attrition and cancellation fees, increased by $2.1 million from the three months ended June 30, 2023 to the three months ended June 30, 2024, $0.6 million of which was due to the acquisition of the non-comparable property. The remaining increase of $1.5 million was primarily due to increases in resort fees and parking.

Current wording

Other revenues, which primarily represent spa, parking, resort fees and attrition and cancellation fees, increased by $1.4 million from the three months ended September 30, 2023 to the three months ended September 30, 2024, $0.3 million of which was due to the acquisition of the non-comparable property. The remaining increase of $1.1 million was primarily due to increases in resort fees and attrition and cancellation fees.

Previous wording

Our hotel operating expenses increased $12.2 million from the three months ended June 30, 2023 to the three months ended June 30, 2024, $3.2 million of which was due to the acquisition of the non-comparable property. The remaining increase in hotel operating expenses was primarily due to higher occupancy levels and increased labor costs.

Current wording

Our hotel operating expenses increased $5.5 million from the three months ended September 30, 2023 to the three months ended September 30, 2024, $1.2 million of which was due to the acquisition of the non-comparable property. The remaining increase in hotel operating expenses was primarily due to increased labor costs.

Previous wording

Depreciation and amortization. Depreciation and amortization on our hotel buildings is generally recorded over a 40 year period subsequent to acquisition. Depreciable lives of hotel furniture, fixtures and equipment are estimated as the time period between the acquisition date and the date that the hotel furniture, fixtures and equipment will be replaced. Our depreciation and amortization expense remained flat for the three months ended June 30, 2024 primarily due to the acquisition of the non-comparable property, offset by fully depreciated assets.

Current wording

Depreciation and amortization. Depreciation and amortization on our hotel buildings is generally recorded over a 40 year period subsequent to acquisition. Depreciable lives of hotel furniture, fixtures and equipment are estimated as the time period

Previous wording

Impairment losses. During the three months ended June 30, 2023, we recorded an impairment loss of $0.9 million related to the write-off of construction in progress that was determined not to be recoverable. No impairment loss was recorded during the three months ended June 30, 2024.

Current wording

Impairment losses. During the three months ended September 30, 2024, we recorded an impairment loss of $1.6 million related to the write-off of construction in progress that was determined not to be recoverable. No impairment loss was recorded during the three months ended September 30, 2023.

Previous wording

Corporate expenses. Corporate expenses principally consist of employee-related costs, including payroll, bonus, restricted stock and benefits. Corporate expenses also include corporate operating costs, professional fees and directors' fees. Our corporate expenses increased $21.3 million from the six months ended June 30, 2023 primarily due to $20.4 million of severance expense recognized due to the leadership changes announced in April 2024 and severance payments to the former Chief Executive Officer and Chief Investment Officer pursuant to their respective severance agreements. We do not expect to recognize any additional severance expense in the second half of the year associated with our previously announced leadership changes.

Current wording

Corporate expenses. Corporate expenses principally consist of employee-related costs, including payroll, bonus, restricted stock and benefits. Corporate expenses also include corporate operating costs, professional fees and directors' fees. Our corporate expenses increased $0.1 million from the three months ended September 30, 2023 primarily due to costs related to the implementation of a new enterprise resource planning system in the second quarter of 2024.

Previous wording

Business interruption insurance income. During the three months ended June 30, 2023, we recognized $0.1 million of business interruption insurance income related to an insurance claim at the Worthington Renaissance Fort Worth Hotel. No business interruption insurance income was recorded during the three months ended June 30, 2024.

Current wording

Business interruption insurance income. During the three months ended September 30, 2023, we recognized $0.5 million of business interruption insurance income related to an electrical fire at the Hilton Garden Inn New York/Times Square Central that caused the hotel to be closed for seven days. No business interruption insurance income was recorded during the three months ended September 30, 2024.

Previous wording

Interest expense. Our interest expense increased $0.6 million from the three months ended June 30, 2023 to the three months ended June 30, 2024 and was comprised of the following (in thousands):

Current wording

Interest expense. Our interest expense increased $1.0 million from the three months ended September 30, 2023 to the three months ended September 30, 2024 and was comprised of the following (dollars in thousands):

Previous wording

The decrease in interest expense is primarily related to the conversion of certain of our interest rate swaps to cash flow hedges as of April 1, 2023, partially offset by rising interest rates on our variable rate debt.

Current wording

The increase in interest expense is primarily related to the rising interest rates on our variable rate debt as well as the maturity of some of our interest rate swaps during the year.

Previous wording

Rooms revenues increased by $9.0 million from the six months ended June 30, 2023 to the six months ended June 30, 2024, $2.8 million of which was due to the acquisition of the non-comparable property. The remaining increase of $6.2 million was the result of improved occupancy at our resort hotels and increased occupancy and ADR at our urban hotels.

Current wording

Rooms revenues increased by $15.1 million from the nine months ended September 30, 2023 to the nine months ended September 30, 2024, $3.5 million of which was due to the acquisition of the non-comparable property. The remaining increase of $11.6 million was the result of improved occupancy at our hotels and increased ADR at our urban hotels.

Previous wording

The following are key hotel operating statistics for the six months ended June 30, 2024 and 2023. The 2023 operating statistics reflect the period in 2023 comparable to our ownership period in 2024 for the non-comparable property.

Current wording

The following are key hotel operating statistics for the nine months ended September 30, 2024 and 2023. The 2023 operating statistics reflect the period in 2023 comparable to our ownership period in 2024 for the non-comparable property.

Previous wording

Food and beverage revenues increased $9.7 million from the three months ended June 30, 2023 to the three months ended June 30, 2024, $1.5 million of which was due to the acquisition of the non-comparable property. The remaining increase was primarily due to increases in both banquet revenues and audio visual revenues, driven by an increase in group business during the quarter.

Current wording

Food and beverage revenues increased $19.4 million from the nine months ended September 30, 2023 to the nine months ended September 30, 2024, $3.7 million of which was due to the acquisition of the non-comparable property. The remaining increase was primarily due to increases in both banquet revenues and audio visual revenues, driven by an increase in group business during the first half of the year.

Previous wording

Other revenues, which primarily represent spa, parking, resort fees and attrition and cancellation fees, increased by $3.6 million from the six months ended June 30, 2023 to the six months ended June 30, 2024, $1.2 million of which was due to the acquisition of the non-comparable property. The remaining increase of $2.4 million was primarily due to increases in resort fees and parking.

Current wording

Other revenues, which primarily represent spa, parking, resort fees and attrition and cancellation fees, increased by $5.0 million from the nine months ended September 30, 2023 to the nine months ended September 30, 2024, $1.4 million of which was due to the acquisition of the non-comparable property. The remaining increase of $3.6 million was primarily due to increases in resort fees and parking.

Previous wording

Our hotel operating expenses increased $26.4 million from the six months ended June 30, 2023 to the six months ended June 30, 2024, $6.4 million of which was due to the acquisition of the non-comparable property. The remaining increase in hotel operating expenses was primarily due to higher occupancy levels and increased labor costs. Other property-level expenses increased due to higher property tax assessments and insurance premiums.

Current wording

Our hotel operating expenses increased $31.9 million from the nine months ended September 30, 2023 to the nine months ended September 30, 2024, $7.6 million of which was due to the acquisition of the non-comparable property. The remaining increase in hotel operating expenses was primarily due to higher occupancy levels and increased labor costs. Other property-level expenses increased due to higher property tax assessments and insurance premiums.

Previous wording

Depreciation and amortization. Depreciation and amortization on our hotel buildings is generally recorded over a 40 year period subsequent to acquisition. Depreciable lives of hotel furniture, fixtures and equipment are estimated as the time period between the acquisition date and the date that the hotel furniture, fixtures and equipment will be replaced. Our depreciation and amortization expense increased $0.9 million, or 1.6%, from the six months ended June 30, 2023 primarily due to the acquisition of the non-comparable property.

Current wording

Depreciation and amortization. Depreciation and amortization on our hotel buildings is generally recorded over a 40 year period subsequent to acquisition. Depreciable lives of hotel furniture, fixtures and equipment are estimated as the time period between the acquisition date and the date that the hotel furniture, fixtures and equipment will be replaced. Our depreciation and amortization expense increased $1.5 million, or 1.9%, from the nine months ended September 30, 2023 primarily due to the acquisition of the non-comparable property.

Previous wording

Impairment losses. During the six months ended June 30, 2023, we recorded an impairment loss of $0.9 million related to the write-off of construction in progress that was determined not to be recoverable. No impairment loss was recorded during the six months ended June 30, 2024.

Current wording

Impairment losses. During the nine months ended September 30, 2024 and 2023, we recorded impairment losses of $1.6 million and $0.9 million, respectively, related to the write-off of construction in progress that was determined not to be recoverable.

Previous wording

Corporate expenses. Corporate expenses principally consist of employee-related costs, including payroll, bonus, restricted stock and benefits. Corporate expenses also include corporate operating costs, professional fees and directors' fees. Our corporate expenses increased $20.2 million from the three months ended June 30, 2023 primarily due to $20.4 million of severance expense recognized due to the leadership changes announced in April 2024 and severance payments to the former Chief Executive Officer and Chief Investment Officer pursuant to their respective severance agreements. We do not expect to recognize any additional severance expense in the second half of the year associated with our previously announced leadership changes.

Current wording

Corporate expenses. Corporate expenses principally consist of employee-related costs, including payroll, bonus, restricted stock and benefits. Corporate expenses also include corporate operating costs, professional fees and directors' fees. Our corporate expenses increased $21.4 million from the nine months ended September 30, 2023 primarily due to $20.4 million of severance expense recognized due to the leadership changes announced in April 2024 and severance payments to the former Chief Executive Officer and Chief Investment Officer pursuant to their respective severance agreements.

Previous wording

Business interruption insurance income. During the six months ended June 30, 2023, we recognized $0.1 million of business interruption insurance income related to an insurance claim at the Worthington Renaissance Fort Worth Hotel. No business interruption insurance income was recorded during the six months ended June 30, 2024.

Current wording

that caused the hotel to be closed for seven days and $0.1 million related to an insurance claim at the Worthington Renaissance Fort Worth Hotel. No business interruption insurance income was recorded during the nine months ended September 30, 2024.

Previous wording

Interest expense. Our interest expense decreased $0.3 million from the six months ended June 30, 2023 to the six months ended June 30, 2024 and was comprised of the following (in thousands):

Current wording

Interest expense. Our interest expense increased $0.7 million from the nine months ended September 30, 2023 to the nine months ended September 30, 2024 and was comprised of the following (dollars in thousands):

Previous wording

The increase in interest expense is primarily related to the rising interest rates on our variable rate debt.

Current wording

The increase in interest expense is primarily the result of elevated interest rates on our variable rate debt.

Previous wording

Our short-term liquidity requirements consist primarily of funds necessary to pay our scheduled debt service, near term debt maturities, operating expenses, ground lease payments, capital expenditures directly associated with our hotels, any share repurchases, distributions to our common and preferred stockholders, and the cost of acquiring additional hotels. Other than scheduled debt service payments, we have one mortgage loan that matures on August 6, 2024, which has a principal balance of $73.4 million as of June 30, 2024. We intend to repay this mortgage loan using cash on hand.

Current wording

Our short-term liquidity requirements consist primarily of funds necessary to pay our scheduled debt service, near term debt maturities, operating expenses, ground lease payments, capital expenditures directly associated with our hotels, any share repurchases, distributions to our common and preferred stockholders, and the cost of acquiring additional hotels. On August 6, 2024, we paid off $73.3 million outstanding on the Courtyard New York Manhattan/Midtown East mortgage loan using cash on hand.

Previous wording

Our mortgage debt agreements contain “cash trap” provisions that are triggered when the hotel’s operating results fall below a certain debt service coverage ratio. When these provisions are triggered, all of the excess cash flow generated by the hotel is deposited directly into cash management accounts for the benefit of our lenders until a specified debt service coverage ratio is reached and maintained for a certain period of time. Such provisions do not allow the lender the right to accelerate repayment of the underlying debt. As of June 30, 2024, we had no cash traps in place.

Current wording

Our mortgage debt agreements contain “cash trap” provisions that are triggered when the hotel’s operating results fall below a certain debt service coverage ratio. When these provisions are triggered, all of the excess cash flow generated by the hotel is deposited directly into cash management accounts for the benefit of our lenders until a specified debt service coverage ratio is reached and maintained for a certain period of time. Such provisions do not allow the lender the right to accelerate repayment of the underlying debt. We had no cash traps in effect as of September 30, 2024.

Previous wording

Our long-term liquidity requirements consist primarily of funds necessary to pay for the costs of acquiring additional hotels, renovations and other capital expenditures that need to be made periodically to our hotels, scheduled debt payments, debt maturities, certain redemptions of limited operating partnership units (“common OP units”), ground lease payments, share repurchases, and making distributions to our common and preferred stockholders. We expect to meet our long-term liquidity requirements through various sources of capital, including cash provided by operations, borrowings, issuances of additional equity, including common OP units, and/or debt securities and proceeds from property dispositions. Our ability to incur additional debt is dependent upon a number of factors, including the state of the credit markets, our degree of leverage, the value of our unencumbered assets and borrowing restrictions imposed by existing lenders. Our ability to raise capital through the issuance of additional equity and/or debt securities is also dependent on a number of factors including the current state of the capital markets, investor sentiment and our intended use of proceeds. We may need to raise additional capital if we identify acquisition opportunities that meet our investment objectives and require liquidity in excess of existing cash balances. Our ability to raise funds through the issuance of equity securities depends on, among other things, general market conditions for hotel companies and REITs and market perceptions about us.

Current wording

Our long-term liquidity requirements consist primarily of funds necessary to pay for the costs of acquiring additional hotels, renovations and other capital expenditures that need to be made periodically to our hotels, scheduled debt payments, debt maturities, certain redemptions of limited operating partnership units (“common OP units”), ground lease payments, share repurchases, redemption of our preferred shares, and making distributions to our common and preferred stockholders. We expect to meet our long-term liquidity requirements through various sources of capital, including cash provided by operations, borrowings, issuances of additional equity, including common OP units, and/or debt securities and proceeds from property dispositions. Our ability to incur additional debt is dependent upon a number of factors, including the state of the credit markets, our degree of leverage, the value of our unencumbered assets and borrowing restrictions imposed by existing lenders. Our ability to raise capital through the issuance of additional equity and/or debt securities is also dependent on a number of factors including the current state of the capital markets, investor sentiment and our intended use of proceeds. We may need to raise additional capital if we identify acquisition opportunities that meet our investment objectives and require liquidity in excess of existing cash balances. Our ability to raise funds through the issuance of equity securities depends on, among other things, general market conditions for hotel companies and REITs and market perceptions about us.

Previous wording

We believe that we maintain a reasonable amount of debt. As of June 30, 2024, we had $1.2 billion of debt outstanding with a weighted average interest rate of 5.22% and a weighted average maturity date of approximately 2.2 years, assuming all extension options available in our debt agreements are exercised. We have one mortgage loan maturing on August 6, 2024, which we intend to repay using cash on hand, and two additional mortgage loans and our $300 million term loan that mature in the next 12 months. We intend to exercise our right to extend our $300 million term loan an additional year, which would bring its maturity date to January 3, 2026. We intend to refinance the other mortgage loans that mature in 2025 as they approach their respective maturity dates. In the case that refinancing options are not attractive, we may repay such mortgage loans using our senior unsecured revolving credit facility. As of June 30, 2024, 32 of our 36 hotels are unencumbered by mortgage debt. We remain committed to our core strategy of prudent leverage.

Current wording

We believe that we maintain a reasonable amount of debt. As of September 30, 2024, we had $1.1 billion of debt outstanding with a weighted average interest rate of 5.60% and a weighted average maturity date of approximately 1.9 years. We have two mortgage loans that mature in the next 12 months. We intend to refinance the other mortgage loans that mature in 2025 as they approach their respective maturity dates. In the case that refinancing options are not attractive, we may repay such mortgage loans using our senior unsecured revolving credit facility. As of September 30, 2024, 33 of our 36 hotels are unencumbered by mortgage debt. We remain committed to our core strategy of prudent leverage.

Previous wording

We maintain an “at-the-market” equity offering program (the “ATM Program”), pursuant to which we may issue and sell shares of our common stock from time to time, having an aggregate offering price of up to $200.0 million. We have not sold any shares under the ATM Program, which is scheduled to expire pursuant to its terms on August 6, 2024. We expect to replace the ATM Program prior to its expiration.

Current wording

In August 2024, our board of directors approved an “at-the-market” equity offering program (the “Current ATM Program”), pursuant to which we may issue and sell shares of our common stock from time to time, having an aggregate offering price of up to $200.0 million. Prior to the implementation of the Current ATM Program, we had a $200.0 million ATM program (the “Prior ATM Program”), which is no longer active. No shares were sold under either the Prior ATM Program or the Current ATM Program during the three and nine months ended September 30, 2024.

Previous wording

In May 2024, our board of directors authorized the repurchase of up to $200.0 million of our common stock under a new share repurchase program, which replaced our prior share repurchase program that was authorized in September 2022. The timing and actual number of shares repurchased will depend on a variety of factors, including price and general business and market conditions. The new share repurchase program does not obligate us to acquire any particular amount of shares, and may be suspended or discontinued at any time at our discretion. The new share repurchase program will expire on May 1, 2026. As of June 30, 2024, we repurchased 2,454,307 shares of common stock at an average price of $8.39 per share for a total purchase price of $20.6 million under this program. Subsequent to June 30, 2024, we repurchased 660,569 shares at an average price of $8.14 per share for a total purchase price of $5.4 million. As of August 2, 2024, we have $174.0 million of authorized capacity remaining under the new share repurchase program. All share repurchases during the year were made under the new share repurchase program.

Current wording

In May 2024, our board of directors authorized the repurchase of up to $200.0 million of our common stock under a new share repurchase program, which replaced our prior share repurchase program that was authorized in September 2022. The timing and actual number of shares repurchased will depend on a variety of factors, including price and general business and market conditions. The new share repurchase program does not obligate us to acquire any particular amount of shares, and may be suspended or discontinued at any time at our discretion. The new share repurchase program will expire on May 1, 2026. As of September 30, 2024, we had repurchased 3,114,876 shares of common stock at an average price of $8.33 per share for a total purchase price of $26.0 million under this program. As of November 8, 2024, we have $174.0 million of authorized capacity remaining under the new share repurchase program. All share repurchases during the year were made under the new share repurchase program.

Previous wording

We are party to a Sixth Amended and Restated Credit Agreement that provides us with a $400 million senior unsecured revolving credit facility and two term loan facilities in the aggregate amount of $800 million. The revolving credit facility matures on September 27, 2026, which we may extend for an additional year upon the payment of applicable fees and satisfaction of certain standard conditions. The term loan facilities consist of a $500 million term loan that matures on January 3, 2028 and a $300 million term loan that matures on January 3, 2025. The maturity date of the $300 million term loan may be extended for an additional year upon the payment of applicable fees and satisfaction of certain standard conditions. We intend to exercise our right to extend our $300 million term loan an additional year. We have the right to increase the aggregate amount of the facilities to $1.4 billion upon the satisfaction of certain standard conditions.

Current wording

We are party to a Sixth Amended and Restated Credit Agreement that provides us with a $400 million senior unsecured revolving credit facility and two term loan facilities in the aggregate amount of $800 million. The revolving credit facility matures on September 27, 2026, which we may extend for an additional year upon the payment of applicable fees and satisfaction of certain standard conditions. The term loan facilities consist of a $500 million term loan that matures on January 3, 2028 and a $300 million term loan that matures on January 3, 2026. In September 2024, we exercised our option to extend the maturity from January 3, 2025 to January 3, 2026. We have the right to increase the aggregate amount of the facilities to $1.4 billion upon the satisfaction of certain standard conditions.

Previous wording

We expect that our principal sources of cash will include one or more of the following: net cash flow from hotel operations, sales of our equity and debt securities, debt financings and proceeds from any hotel dispositions. Our principal uses of cash are acquisitions of hotel properties, debt service and maturities, share repurchases, capital expenditures, operating costs, ground lease payments, corporate expenses, and distributions to holders of common stock, common OP units and preferred stock. As of June 30, 2024, we had $125.2 million of unrestricted cash, $45.2 million of restricted cash and no outstanding borrowings on our senior unsecured credit facility.

Current wording

We expect that our principal sources of cash will include one or more of the following: net cash flow from hotel operations, sales of our equity and debt securities, debt financings and proceeds from any hotel dispositions. Our principal uses of cash are acquisitions of hotel properties, debt service and maturities, share repurchases and redemptions, capital expenditures, operating costs, ground lease payments, corporate expenses, and distributions to holders of common stock, common OP units and preferred stock. As of September 30, 2024, we had $75.3 million of unrestricted cash, $44.5 million of restricted cash and no outstanding borrowings on our senior unsecured credit facility.

Previous wording

Our net cash provided by operations was $87.0 million for the six months ended June 30, 2024. Our cash from operations generally consists of the net cash flow from hotel operations, offset by cash paid for corporate expenses, interest payments, and other working capital changes. The decrease of $27.5 million in cash provided by operations from the six months ended June 30, 2023 was primarily driven by timing differences related to collections from our hotel managers and severance payments related to our previously announced leadership changes.

Current wording

Our net cash provided by operations was $148.6 million for the nine months ended September 30, 2024. Our cash from operations generally consists of the net cash flow from hotel operations, offset by cash paid for corporate expenses, interest payments, and other working capital changes. The decrease of $36.1 million in cash provided by operations from the nine

Previous wording

Our net cash used in investing activities was $35.8 million for the six months ended June 30, 2024, which consisted of capital expenditures at our hotels.

Current wording

Our net cash used in investing activities was $58.4 million for the nine months ended September 30, 2024, which consisted of capital expenditures at our hotels.

Previous wording

Our net cash used in financing activities was $47.9 million for the six months ended June 30, 2024, which consisted of $12.9 million of distributions paid to holders of common stock and common OP units, $4.9 million of distributions paid to holders of preferred stock, $4.9 million of scheduled mortgage debt principal payments, $4.6 million paid to repurchase shares upon the vesting of restricted stock for the payment of tax withholding obligations, and $20.6 million of shares repurchased under our new share repurchase program.

Current wording

Our net cash used in financing activities was $137.6 million for the nine months ended September 30, 2024, which consisted of $19.3 million of distributions paid to holders of common stock and common OP units, $7.4 million of distributions paid to holders of preferred stock, $7.1 million of scheduled mortgage debt principal payments, $73.3 million of repayments of mortgage debt, $4.6 million paid to repurchase shares upon the vesting of restricted stock for the payment of tax withholding obligations, and $26.0 million of shares repurchased under our share repurchase program.