NOTE 3. ACQUISITION OF HOTEL PROPERTIES

On February 14, 2020, the Company purchased the remaining 20% interest in the Atlanta JV from our joint venture partner (see detailed description of the Atlanta JV in Note 4) for $7,300 as allowed by the purchase option included in the original joint venture agreements. The $7,300 was funded from the Company’s credit facility, and the Company became the primary obligator on the $34,080 New Term Loan (as defined in Note 4) as part of the transaction. As the Atlanta JV was previously accounted for under the equity method and the acquisition was considered the acquisition of assets, the liabilities assumed as part of the transaction were recorded at fair value while the assets purchased in the transaction were recorded based on a pro-rata fair value allocation of the total available basis, which included the fair value of liabilities assumed, the cash purchase price paid, the balance of the investment in the unconsolidated joint venture at the time of the acquisition, and the acquisition costs incurred. The purchase was recognized as follows:


Cash purchase price	$	7,300
Investment in unconsolidated joint venture		3,844
Acquisition costs		104
Total investment in net assets	$	11,248

Cash	$	125
Working capital		(462)
Land		14,723
Buildings, improvements, and vehicle		37,008
Furniture and equipment		2,431
Debt assumed at acquisition		(34,080)
Land option liability (1)		(8,497)
Total allocation to net assets	$	11,248

(1)

The purchase agreement includes a provision which permits the seller to purchase the surface parking lot north of the hotel exercisable for approximately seven years at less than market rates.

Included in the consolidated statements of operations for the three months ended March 31, 2020 are total revenues of $813 and total operating loss of $287 related to the results of operations for Atlanta Aloft hotel since the date of its acquisition.

All purchase price allocations were determined using Level 3 fair value inputs.