Winston Hotels Sells Participation in Lady Luck Loan
02 März 2007 - 1:40PM
Business Wire
Winston Hotels, Inc. (NYSE: WXH), a real estate investment trust
and owner of premium limited-service, upscale extended-stay and
full-service hotels, today announced that it has closed on the sale
of its junior participation interest in the Lady Luck loan to the
loan�s senior participant for approximately $15.2 million. Winston
previously announced in a Form 8-K filed February 23, 2007 with the
Securities and Exchange Commission its exercise of a put option to
sell its interest in this loan. As a result of this transaction and
pursuant to the terms of the merger agreement between Winston and
Wilbur Acquisition Holding Company, LLC, the Lady Luck loan
adjustment will equal $0, and the $14.10 cash merger consideration
to be paid for each share of Winston common stock will remain
unchanged. Preferred Dividend Declared Separately, Winston
announced that its board of directors has declared a cash dividend
of $0.50 per Series B Cumulative Preferred share for the first
quarter of 2007. The cash dividend is payable on April 16, 2007, to
preferred shareholders of record on March 30, 2007. Pursuant to the
terms of the merger agreement, the company is prohibited from
paying common dividends. As a result, the company has suspended its
common dividend. About Winston Hotels As of December 31, 2006,
Winston Hotels owned or was invested in 53 hotel properties in 18
states, having an aggregate of 7,205 rooms. This included 44 wholly
owned properties with an aggregate of 6,013 rooms, a 41.7%
ownership interest in a joint venture that owned one hotel with 121
rooms, a 60% ownership interest in a joint venture that owned one
hotel with 138 rooms, a 49% ownership interest in a joint venture
that owned one hotel with 118 rooms, a 48.78% ownership interest in
a joint venture that owned one hotel with 147 rooms, a 13.05%
ownership interest in a joint venture that owned four hotels with
an aggregate of 545 rooms, and a 0.21% ownership interest in a
joint venture that owned one hotel with 123 rooms for which
substantially all of the profit or loss generated by the joint
venture is allocated to the company. As of December 31, 2006, the
company also had $52.1 million in loan receivables from owners of
several hotels. The company does not hold an ownership interest in
any of the hotels for which it has provided debt financing. For
more information about Winston Hotels Inc, visit the company�s web
site at www.winstonhotels.com. Additional Information about the
Merger and Where to Find It In connection with the proposed merger,
Winston will file relevant materials with the Securities and
Exchange Commission, including a proxy statement. INVESTORS AND
SECURITY HOLDERS OF WINSTON ARE URGED TO READ THESE MATERIALS WHEN
THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT WINSTON, THE BUYER AND THE MERGER. The proxy
statement and other relevant materials (when they become available)
and any other documents filed by Winston with the SEC may be
obtained free of charge at the SEC's website at www.sec.gov. In
addition, investors and security holders may obtain free copies of
the documents filed with the SEC by Winston by contacting Winston's
Investor Relations at (919) 510-8003 or accessing Winston's
investor relations website. Investors and security holders are
urged to read the proxy statement and the other relevant materials
when they become available before making any voting or investment
decision with respect to the merger. Winston and the buyer and
their respective executive officers, directors, and employees may
be deemed to be participating in the solicitation of proxies from
the security holders of Winston in connection with the merger.
Information about the executive officers and directors of Winston
and the number of Winston common shares beneficially owned by such
persons is set forth in the proxy statement for Winston's 2006
Annual Meeting of Shareholders, which was filed with the SEC on
March 17, 2006, and Winston's Annual Report on Form 10-K for the
year ended December 31, 2005, which was filed with the SEC on March
14, 2006. Investors and security holders may obtain additional
information regarding the direct and indirect interests of Winston
and the buyer and their respective executive officers, directors
and employees in the merger by reading the proxy statement
regarding the merger when it becomes available. Cautionary Note
Regarding Forward Looking Statements Certain statements in this
release that are not historical fact may constitute forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Numerous risks, uncertainties and other factors
may cause actual results to differ materially from those expressed
in any forward-looking statements. These factors include, but are
not limited to, (i) the occurrence of any event, change or other
circumstances that could give rise to the termination of the merger
agreement; (ii) the outcome of any legal proceedings that may be
instituted against Winston and others following announcement of the
merger agreement; (iii) the inability to complete the merger due to
the failure to obtain shareholder approval or the failure to
satisfy other conditions to completion of the merger; (iv) risks
that the proposed transaction disrupts current plans and operations
and the potential difficulties in employee retention as a result of
the merger; (v) the ability to recognize the benefits of the
merger; and (vi) the amount of the costs, fees, expenses and
charges related to the merger. Although Winston believes the
expectations reflected in any forward-looking statements are based
on reasonable assumptions, it can give no assurance that its
expectations will be attained. For a further discussion of these
and other factors that could impact Winston's future results,
performance, achievements or transactions, see the documents filed
by Winston from time to time with the Securities and Exchange
Commission, and in particular the section titled, "Item 1A. Risk
Factors" in our Annual Report on Form 10-K for the year ended
December 31, 2005 filed on March 14, 2006. Winston undertakes no
obligation to revise or update any forward-looking statements, or
to make any other forward-looking statements, whether as a result
of new information, future events or otherwise.
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