FelCor Lodging unit accepts some 8½% notes, floaters early, will call any floaters not tendered

By Angela McDaniels

Tacoma, Wash., Oct. 13 - FelCor Lodging Trust Inc. said its subsidiary, FelCor Lodging LP, accepted for purchase approximately 69% of its $300 million principal amount of 8½% senior notes due 2011 and about 99% of its $215 million principal amount of floating-rate senior secured notes due 2011.

The notes accepted represent the notes that had been tendered into the subsidiary's tender offers as of 11:59 p.m. ET on Oct. 12. The offers began Sept. 17 and will expire at 11:59 p.m. ET on Oct. 15.

The subsidiary waived the conditions to the tender offers and accepted the notes so that it could complete its $363 million offering of 10% senior secured notes due 2014, which was conditioned on the consummation of the tender offers.

Holders can continue to tender their notes into the offer through the expiration date, and any floating-rate notes that are not tendered will be called for redemption, according to a company news release.

The payment on offer is par, which includes a consent payment of $20 for each $1,000 principal amount of notes tendered by the consent deadline of 5 p.m. ET on Sept. 30.

The subsidiary is also soliciting consents to proposed amendments to the indentures governing the notes that will eliminate substantially all of the restrictive covenants and some event-of-default provisions.

Additionally, if holders of at least two-thirds of floating-rate notes consent, the collateral securing those notes will be released.

Holders who tender their notes are required to consent to all of the proposed amendments.

The subsidiary announced on Sept. 30 that it had received enough consents to amend the indentures.

The dealer manager and solicitation agent is J.P. Morgan Securities Inc. (212 270-3994 or 800 245-8812), and the information agent is Global Bondholder Services Corp. (212 430-3774 for banks and brokers, others call 866 470-4300).

FelCor is an Irving, Texas-based real estate investment trust that owns upscale, all-suite hotels.

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