HMT Host Marriott Cp

BETHESDA, Md., Jan. 11 /PRNewswire-FirstCall/ -- Host Marriott Corporation (NYSE:HMT) announced today that it will exercise its option to cause the conversion rights of its 6.75% convertible subordinated debentures and the corresponding conversion rights of the holders of the 6.75% Convertible Quarterly Income Preferred Securities (CUSIP# 441079407) issued by the Host Marriott Financial Trust (the "QUIPS") to expire. The Company is exercising this option since the market price of its common stock has exceeded 120% of the adjusted conversion price of the QUIPS for 20 out of the last 30 trading days. The last reported sale price of the Company's common stock as of January 10, 2005 was $19.50. The QUIPS currently are convertible into 3.2537 shares of Host Marriott common stock per $50 liquidation amount of preferred security, which equates to an adjusted conversion price of $15.367. The conversion rights of the QUIPS holders will expire at 5:00 p.m. (Eastern Standard Time) on February 10, 2006. (Logo: http://www.newscom.com/cgi-bin/prnh/20040324/HOSTMARRIOTTLOGO ) Additionally, on December 12, 2005 the Company gave notice to QUIPS holders of a partial redemption of $100 million of QUIPS to occur on January 11, 2006 and, in response to the notice, many holders elected to convert their QUIPS securities that were subject to redemption. If all of the QUIPS holders elect to convert their remaining securities to Host Marriott common shares prior to the expiration of their conversion rights, the aggregate conversions (after taking into account conversions in response to the partial redemption) will result in the issuance of approximately 30.9 million shares of Host Marriott common stock as well as a $492 million reduction of the Company's debt and the elimination of approximately $32 million of related annual fixed charges. The Company's 2006 full year guidance for Funds from Operations (FFO) per diluted share will not be affected since QUIPS were already reflected on a converted basis, and the Company's forecasted 2006 Net Income will increase approximately $30 million. This press release contains forward-looking statements within the meaning of federal securities regulations. These forward-looking statements are identified by their use of terms and phrases such as "anticipate," "believe," "could," estimate," "expect," "intend," "may," "plan," predict," "project," "will," "continue" and other similar terms and phrases, including references to assumption and forecasts of future results. Forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors which may cause the actual results to differ materially from those anticipated at the time the forward-looking statements are made. These risks include, but are not limited to: national and local economic and business conditions, including the potential for terrorist attacks, that will affect occupancy rates at our hotels and the demand for hotel products and services; operating risks associated with the hotel business; risks associated with the level of our indebtedness and our ability to meet covenants in our debt agreements; relationships with property managers; our ability to maintain our properties in a first-class manner, including meeting capital expenditure requirements; our ability to compete effectively in areas such as access, location, quality of accommodations and room rate structures; changes in travel patterns, taxes and government regulations which influence or determine wages, prices, construction procedures and costs; our ability to complete pending acquisitions and dispositions; and our ability to continue to satisfy complex rules in order for us to qualify as a Real Estate Investment Trust for federal income tax purposes and other risks and uncertainties associated with our business described in the Company's filings with the Securities and Exchange Commission. Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that the expectations will be attained or that any deviation will not be material. All information in this release is as of January 10, 2006, and the Company undertakes no obligation to update any forward-looking statement to conform the statement to actual results or changes in the Company's expectations. http://www.newscom.com/cgi-bin/prnh/20040324/HOSTMARRIOTTLOGO http://photoarchive.ap.org/ DATASOURCE: Host Marriott Corporation CONTACT: Kevin J. Jacobs, Vice President, +1-240-744-5212, or Gregory J. Larson, Senior Vice President, +1-240-744-5120, both of Host Marriott Corporation Web site: http://www.hostmarriott.com/

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