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Based upon that evaluation, our President and Chief Executive Officer and our Chief Financial Officer and Treasurer concluded that our disclosure controls and procedures are effective.
−Removed: There have been no changes in our internal control over financial reporting during the quarter ended June 30, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
+Added: There have been no changes in our internal control over financial reporting during the quarter ended September 30, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Warning Concerning Forward-Looking Statements
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• Our ability to maintain sufficient liquidity during the duration of the COVID-19 pandemic and any resulting economic conditions,
+Added: • If and when hotel business will return to historical pre-pandemic levels,
• Potential defaults on, or non-renewal of, leases by our tenants,
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We may be unable to pay our debt obligations or to increase or maintain our current rate of distributions on our common shares and future distributions may be reduced or eliminated,
−Removed: • Sonesta operated 261 of our 304 hotels as of June 30, 2021.
−Removed: We are currently negotiating with Radisson its possible continued management of nine of our hotels.
−Removed: If we do not reach an agreement with Radisson, we expect that some or all of these hotels may transition to Sonesta.
+Added: • Sonesta operated 261 of our 304 hotels as of September 30, 2021, many of which were transitioned to Sonesta over the past year, and we transitioned the branding and management of one additional hotel to Sonesta on November 1, 2021.
Transitioning hotels to another operator is disruptive to the hotels’ operations and requires significant capital investments.
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• Contingencies in our pending sale agreements may not be satisfied and any expected sales and any related management or lease arrangements we expect to enter may not occur, may be delayed or the terms of such transactions or arrangements may change,
−Removed: • As of August 4, 2021, we had approximately $963.1 million of cash or cash equivalents.
+Added: • As of November 3, 2021, we had approximately $937.0 million of cash or cash equivalents.
This statement may imply that we have sufficient working capital and liquidity to meet our obligations for the next twelve months.
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• Continued availability of borrowings under our revolving credit facility is subject to our satisfying certain financial covenants and other credit facility conditions.
−Removed: The ratio of income available for debt service to debt service was below the 1.5x requirement under our public debt covenants as of June 30, 2021.
+Added: The ratio of income available for debt service to debt service was below the 1.5x requirement under our public debt covenants as of September 30, 2021.
We are not permitted under our debt agreements to incur additional debt while this ratio is below 1.5x.
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• We may be unable to repay our debt obligations when they become due.
+Added: Also, our $1,000,000 revolving credit facility matures on July 15, 2022 and we may not be able to meet the conditions required to exercise the extension option available to us under the agreement or be able to refinance the balance with new debt.
+Added: We may need to seek additional waivers or amendments with our lenders and there is no assurance we will be granted such relief,
• We intend to conduct our business activities in a manner that will afford us reasonable access to capital for investment and financing activities.
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If challenging market conditions last for a long period or worsen, our managers and tenants may experience liquidity constraints and as a result may be unable or unwilling to pay returns or rents to us and our ability to operate our business effectively may be challenged,
−Removed: • We currently expect to fund $100 million of capital expenditures during the last six months of 2021.
+Added: • We currently expect to fund $30 million of capital expenditures during the last three months of 2021.
The cost of capital projects may be greater than we anticipate and operating results at our hotels may decline as a result of having rooms out of service to complete such improvements,
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Accordingly, we cannot be sure that these agreements will remain in effect for continuing 20 year terms,
−Removed: • We believe that our relationships with our related parties, including RMR LLC, RMR Inc., TA, Sonesta and others affiliated with them may benefit us and provide us with competitive advantages in operating and growing our business.
+Added: • We believe that our relationships with our related parties, including RMR LLC, TA, Sonesta and others affiliated with them may benefit us and provide us with competitive advantages in operating and growing our business.
However, the advantages we believe we may realize from these relationships may not materialize, and
−Removed: • Two of our subsidiaries have initiated arbitration proceedings against Marriott and several of its subsidiaries after Marriott challenged the efficacy of the termination of our agreement with them.
+Added: • We are party to arbitration proceedings with Marriott relating to our termination of our management agreements with them.
The results of arbitration proceedings are difficult to predict and we can provide no assurances regarding such results.
Even if we are successful in such proceedings, the pendency and conduct of such proceedings may be expensive and distracting to our management, and could be disruptive to our operations.
−Removed: Currently unexpected results could occur due to many different circumstances, some of which are beyond our control, such as pandemics, including the COVID-19 pandemic, acts of terrorism, natural disasters, changes in our managers’ or tenants’ revenues or expenses, changes in our managers’ or tenants’ financial conditions, the market demand for hotel rooms or the goods and services provided at our properties or changes in capital markets or the economy generally.
+Added: Currently unexpected results could occur due to many different circumstances, some of which are beyond our control, such as pandemics, including the COVID-19 pandemic, acts of terrorism, natural disasters, climate change, changes in our managers’ or tenants’ revenues or expenses, changes in our managers’ or tenants’ financial conditions, the market demand for hotel rooms or the goods and services provided at our properties or changes in capital markets or the economy generally.
The information contained elsewhere in this Quarterly Report on Form 10-Q, our 2020 Annual Report or in our other filings with the SEC, including under the caption “Risk Factors,” or incorporated herein or therein, identifies other important factors that could cause differences from our forward-looking statements.
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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.