IRVING, TX—FelCor Lodging Trust Incorporated has closed a $140 million term loan, secured by three unspecified properties, as part of its plan to restructure its balance sheet.

FelCor expects to use proceeds from the term loan, cash on hand and its line of credit to redeem its remaining $234 million of 10% senior secured notes in August. FelCor will thereafter use proceeds from pending and future asset sales to repay debt and complete its balance sheet restructuring.

"We continue to improve our balance sheet significantly by enhancing our maturity profile, lowering our cost of debt and reducing leverage,” said Richard Smith, president and chief executive officer. “After redeeming our 10% notes, our weighted average cost of borrowing will be below 6%, and our next significant debt maturity, other than the line of credit, occurs in 2019. Furthermore, we remain on track to achieve our target leverage in 2015."

Borrowings under the facility bear interest at LIBOR plus 2.5%. The loan matures in 2017, may be extended for up to two years, based on satisfaction of certain conditions, and is freely pre-payable.

FelCor, based in Irving, owns a diversified portfolio of primarily upper-upscale and luxury hotels that are located in major and resort markets throughout the US. FelCor partners with leading hotel companies to operate its hotels, which are flagged under globally renowned names and premier independent hotels.