Condor Hospitality Trust drops exchange offer for 8%, 10% preferreds

By Susanna Moon

Chicago, Sept. 17 – Condor Hospitality Trust, Inc. terminated the exchange offer for its 8% series A cumulative preferred stock and 10% series B cumulative preferreds, according to an 8-K filing with the Securities and Exchange Commission.

The company also canceled the Oct. 8 shareholder meeting, which had been scheduled to obtain the shareholder approvals that were conditions to the exchange offer.

As of Wednesday, holders had tendered 14,633 shares of the 8% preferreds and 10,860 shares of the 10% preferreds.

The exchange offer had been set to end at 5 p.m. ET on Oct. 12, extended from 5 p.m. ET on Sept. 9.

As of Aug. 31, none of the preferreds had been tendered for exchange.

The company noted that the closing price of the preferreds on Aug. 28 was $7.00 for the 8% preferreds and $18.95 for the 10% preferreds.

As announced July 23, Condor had offered up to 11,664,615 shares of common stock in exchange for the preferreds at a designated value of $2.3254 per common share.

The share value was equal to the average weighted sale prices of the common stock for the three trading days preceding July 15, the date the company announced agreements to purchase three new hotels.

The company previously said it planned to offer 5.38 common shares for each series A preferred, representing a value of $12.502 for each series A preferred. That amount was equal to the $10 liquidation value, a 10% premium and the accrued dividends prorated to Sept. 15.

The company was offering 13.71 common shares for each series B preferred, or a value of $31.875 for each series B preferred. That amount was equal to the $25 liquidation value, a 10% premium and the accrued dividends plus compounded interest prorated to Sept. 15.

Condor previously said that a condition to the exchange offer would be that the holders accepting the exchange offer will waive their rights to unpaid dividends.

In addition, the company plans to condition the offer on the receipt of tenders for at least 80% of each of the series A preferreds and series B preferreds.

As of March 31, there were 803,270 series A preferreds outstanding with a total liquidation preference of $8,032,700 outstanding and 332,500 series B preferreds outstanding with a total liquidation preference of $8,312,500.

Condor, formerly Supertel Hospitality Inc., is a real estate investment trust based in Norfolk, Neb.

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