12. COMMITMENTS AND CONTINGENCIES:

On April 9, 2024, the Company received service of process in a lawsuit naming the Company and a subsidiary as co-defendants with Marriott, as the manager, and multiple contractors in a personal injury lawsuit filed by individual plaintiffs in Colorado state court. The lawsuit relates to a May 2023 incident at the Gaylord Rockies indoor pool amenity involving the collapse of HVAC equipment. The complaint as amended requested an unspecified amount of damages related to alleged injuries to three guests and related claims by their families.

In October 2026, the insurance carriers representing the defendants reached a confidential settlement with one of the injured guests and the guest’s family. This settlement will resolve all claims of this plaintiff. The applicable settlement payment will be funded directly by the insurance companies under the policies maintained by Marriott and the contractors. The Company has no payment obligation and will not recognize a charge related to this settlement.

The discovery phase of the litigation remains ongoing at this time with respect to the claims by the remaining plaintiffs. The Company cannot predict its likely outcome or estimate the range of possible loss but does not believe that the outcome will have a material impact on the Company’s financial position. The Company intends to vigorously defend the lawsuit and believes it has strong defenses.

The Company has entered into employment agreements with certain officers, which provide for severance payments upon certain events, including certain terminations in connection with a change of control.

In addition, the Company, in the ordinary course of business, is involved in certain legal actions and claims on a variety of matters. It is the opinion of management that such contingencies will not have a material effect on the financial statements of the Company.