Condor Hospitality Trust Announces Conversion of All Outstanding Series D Preferred Stock to Common Stock

BETHESDA, Md., March 01, 2017 -- Condor Hospitality Trust, Inc. (NASDAQ:CDOR), a hotel-focused real estate investment trust (REIT) headquartered and incorporated in the state of Maryland, today announced that the holders of $62.5 million of outstanding Series D Preferred Stock, representing all of Condor’s outstanding Series D Preferred Stock, voluntarily converted their preferred shares into an aggregate of 39,032,225 shares of the Company’s common stock and 925,000 shares of a new Series E Preferred Stock, face value $10 per share, in the aggregate face amount of $9.25 million.  The common stock conversion price previously established in the Series D issuance agreement in March 2016 was $1.60 per share. 

“The conversion of the Series D Preferred Stock to common stock is transformational in building the Company’s common equity capitalization, while concurrently eliminating the potential for a required cash make whole payment to the holders of the Series D Preferred Stock.  Importantly, the conversion also reduces the amount of outstanding preferred stock to a significantly lower percentage of the equity market capitalization of the Company.  Approximately two years ago, Condor had an upside-down and complicated equity structure with three classes of outstanding preferred stock accruing dividends which were not being currently paid.  Using the proceeds from the $30 million private placement of Series D Preferred Stock completed in early 2016, we redeemed all of the outstanding Series A and B preferred stock at face value plus all accrued dividends and converted the then-outstanding Series C preferred stock into a newly established Series D Preferred Stock that was convertible into our common stock at a conversion price of $1.60 per common share.  The holders of the Series D Preferred Stock have now converted all of the outstanding Series D Preferred Stock into common stock resulting in a pro forma common market capitalization in excess of $90 million, as compared to $9 million at the time this process began,” said Bill Blackham, Condor’s Chief Executive Officer.

The new Series E Preferred Stock issued as part of the conversion transaction pays dividends at an annual rate of 6.25% of the aggregate face value of $9.25 million.  Commencing February 28, 2019, the Series E Preferred Stock is convertible into common stock at a conversion price of $2.13 per share of common stock.

About Condor Hospitality Trust, Inc.

Condor Hospitality Trust, Inc. (NASDAQ:CDOR), is a self-administered real estate investment trust incorporated in the state of Maryland that specializes in the investment and ownership of upper midscale and upscale, premium-branded select-service, extended stay and limited-service hotels.  The company currently owns 19 hotels in 12 states.  Condor’s hotels are franchised by a number of the industry’s most well-regarded brand families including Hilton, Marriott/Starwood, InterContinental Hotels Group, Choice, and Wyndham.  For more information or to make a hotel reservation, visit www.condorhospitality.com.

Certain matters within this press release are discussed using forward-looking language as specified in the Private Securities Litigation Reform Act of 1995, and, as such, may involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance to differ from those projected in the forward-looking statement. These risks are discussed in the company’s filings with the Securities and Exchange Commission.

Contact:
Jonathan J. Gantt
Chief Financial Officer & Senior Vice President
[email protected]
(301) 861-3305