What changed in this filing

/stocks — the workspaceLOADING

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

2023-02-21 compared with 2022-02-15 · 51 added, 23 removed, 41 unchanged (64% of the section changed)

19 unchanged sentences

Market risk is the adverse effect on the value of a financial instrument resulting from a change in interest rates.

The Financial Conduct Authority ("FCA"), which regulates LIBOR, announced that it intends to stop compelling banks to submit rates for the calculation of LIBOR after June 2023.

The Alternative Reference Rates Committee ("ARRC") has proposed that the Secured Overnight Financing Rate ("SOFR") is the rate that best represents the alternative to USD-LIBOR for use in derivatives and other financial contracts that are currently indexed to USD-LIBOR.

In November 2020, the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency, and the FDIC (collectively, the "Agencies") issued a statement to encourage banks to stop entering into new contracts that use USD-LIBOR as the reference rate as soon as practicable, and in any event by December 31, 2021.

The Agencies indicated an extension of the IBA publication of certain USD-LIBOR tenors until June 30, 2023 would allow most legacy USD-LIBOR contracts to mature before LIBOR experiences disruptions.

We are not able to predict when LIBOR will cease to be available or when there will be sufficient liquidity in the SOFR markets.

Any changes adopted by FCA or other governing bodies in the method used for determining LIBOR may result in a sudden or prolonged increase or decrease in reported LIBOR.

If that were to occur, our interest costs could change.

Our unsecured revolving line of credit, term loan, and interest rate swaps are indexed to USD-LIBOR.

However, as our amended and restated line of credit and term loan agreements and interest rate swap agreements have provisions that allow for a transition to a new alternative rate, we believe that the transition from USD-LIBOR to SOFR or other replacement rate will not have a material impact on our consolidated financial statements.

The following table summarizes the Company's four effective interest rate swaps as of December 31, 2021:

The Company is party to four effective interest rate swap agreements and four interest rate forward swap agreements, which address the periods between the maturity dates of the effective swaps and the maturity dates of the Amended Term Loan Agreement.

In tandem, the interest rate swaps achieve fixed interest rates for a constant notional amount through the maturity dates of the Amended Term Loan Agreement.

On December 15, 2022, the Company and IAGM transitioned all interest rate swaps from 1-Month LIBOR to 1-Month Term SOFR.

The Company's and IAGM's hedging instruments continue to qualify for cash flow hedge accounting through application of expedients provided by ASU 2020-04, Reference Rate Reform .

The following table summarizes the Company's four effective and four forward interest rate swaps as of December 31, 2022:

Interest Rate Swap Effective Date Termination

1 unchanged sentence

Variable Rate of InvenTrust Pays

Fixed Rate of Notional

Fixed Rate of Fixed Rate Achieved Notional

Amount Fair Value as of

December 31, 2022

5 year, fixed portion Dec 2, 2019 Dec 21, 2023 1-Month SOFR

1.41% 2.71% $ 100,000 $ 3,222

5 year, fixed portion Dec 2, 2019 Dec 21, 2023 1-Month SOFR

1.42% 2.72% 100,000 3,238

5.5 year, fixed portion Dec 2, 2019 Jun 21, 2024 1-Month SOFR

1.47% 2.77% 50,000 2,275

5.5 year, fixed portion Dec 2, 2019 Jun 21, 2024 1-Month SOFR

1.46% 2.76% 50,000 2,281

$ 300,000 $ 11,016

5 year, fixed portion Dec 21, 2023 Sep 22, 2026 1-Month SOFR

1.51% 2.81% $ 100,000 $ 4,924

5 year, fixed portion Dec 21, 2023 Sep 22, 2026 1-Month SOFR

1.51% 2.81% 100,000 4,949

5.5 year, fixed portion Jun 21, 2024 Mar 22, 2027 1-Month SOFR

1.48% 2.78% 50,000 2,196

5.5 year, fixed portion Jun 21, 2024 Mar 22, 2027 1-Month SOFR

1.54% 2.84% 50,000 2,116

$ 300,000 $ 14,185

The following table summarizes the Company's four effective and four forward interest rate swaps as of December 31, 2021:

Interest Rate Swap Effective Date Termination

Date InvenTrust Receives

Variable Rate of InvenTrust Pays

Fixed Rate of Fixed Rate Achieved Notional

Amount Fair Value as of December 31, 2021

4 unchanged sentences

$ 300,000 $ (3,966)

The following table summarizes the Company's four forward interest rate swaps as of December 31, 2021:

Interest Rate Swap Effective Date Termination

Date InvenTrust Receives

Variable Rate of InvenTrust Pays

Fixed Rate of Notional

5 year, fixed portion Dec 21, 2023 Sep 22, 2026 1-Month SOFR

1.58% 2.78% $ 100,000 $ (230)

5 year, fixed portion Dec 21, 2023 Sep 22, 2026 1-Month SOFR

1.57% 2.77% 100,000 (212)

5.5 year, fixed portion Jun 21, 2024 Mar 22, 2027 1-Month SOFR

1.58% 2.78% 50,000 (87)

5.5 year, fixed portion Jun 21, 2024 Mar 22, 2027 1-Month SOFR

1.60% 2.80% 50,000 (118)

$ 300,000 $ (647)

The following table summarizes IAGM's effective interest rate swaps as of December 31, 2022:

Interest Rate Swap Effective Date Termination Date IAGM Receives

Variable Rate of IAGM Pays

Fixed Rate of Fixed Rate Achieved Notional

Amount Fair Value as of December 31, 2022

5 year, fixed portion Dec 21, 2023 Sep 22, 2026 1-Month LIBOR 1.5763% $ 100,000 $ (230) $ —

5 year, fixed portion Dec 21, 2023 Sep 22, 2026 1-Month LIBOR 1.5730% 100,000 (212) —

5.5 year, fixed portion Jun 21, 2024 Mar 22, 2027 1-Month LIBOR 1.5770% 50,000 (87) —

5.5 year, fixed portion Jun 21, 2024 Mar 22, 2027 1-Month LIBOR 1.5960% 50,000 (118) —

Secured term loan Apr 1, 2020 Nov 2, 2023 1-Month SOFR

0.35% 2.00% $ 45,000 $ 1,655

Secured term loan Apr 1, 2020 Nov 2, 2023 1-Month SOFR

0.32% 1.97% 30,000 $ 1,109

$ 75,000 $ 2,764

The following table summarizes IAGM's effective interest rate swaps as of December 31, 2021:

1 unchanged sentence

Variable Rate of IAGM Pays

Fixed Rate of Notional

Fixed Rate of Fixed Rate Achieved Notional

Amount Fair Value as of December 31, 2021

Secured term loan 4/1/2020 11/2/2023 1-Month LIBOR 0.4290% $ 45,000 $ 310 $ (327)

Secured term loan 4/1/2020 11/2/2023 1-Month LIBOR 0.4060% 30,000 $ 220 $ (198)

Secured term loan Apr 1, 2020 Nov 2, 2023 1-Month LIBOR 0.43% 1.98% $ 45,000 $ 310

Secured term loan Apr 1, 2020 Nov 2, 2023 1-Month LIBOR 0.41% 1.96% 30,000 $ 220

$ 75,000 $ 530

5 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7A. Quantitative and Qualitative Disclosures About Market Risk