Ashford Hospitality amends terms on $75 million private placement

By Sheri Kasprzak

Atlanta, Feb. 10 - Ashford Hospitality Trust Inc. said it has changed some of the terms on a $75 million private placement of preferred stock it announced in January.

The original agreement allowed investor Security Capital Preferred Growth Inc. the option to buy 20% participation in Ashford's recent common stock offering, exercisable through Oct. 11.

That agreement was amended to allow Ashford to sell shares to Security Capital on an earlier date, provided that the company sells the entire $75 million in convertible preferred stock to Security Capital.

Also, in the original agreement, Security Capital had the right to buy $14.7 million in series B preferred stock upon the closing of a 21-hotel acquisition and an additional $20 million by June 30, 2005. In the amendment, if Ashford does not give notice to sell the $34.7 million second tranche of the $75 million preferred offering by June 14, Security Capital may cause the company to issue $34.7 million in preferreds on June 30. The $14.7 million series B preferreds arrangement has been terminated.

On Jan. 4, Ashford announced its plans to sell up to 5,162,000 shares of series B-1 preferreds and up to 2,285,865 shares of series B-2 preferreds at $10.07 each.

On Dec. 30, Security Capital bought 993,049 series B-1 preferreds for a total of $10,000,003.

The preferreds are convertible into common shares at a price obtained by dividing $10.07 by the conversion price in effect at the time of conversion. The initial conversion price is $10.07.

Ashford Hospitality is a Dallas-based real estate investment trust that owns hotels and hotel mortgages.

On Thursday, Ashford's stock closed down $0.01 at $10.19.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.