form8k.htm
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of The Securities Exchange Act of
1934
Date
of Report (Date of earliest event reported): July 3, 2007 (July
1, 2007)
HERSHA
HOSPITALITY TRUST
(Exact
name of registrant as specified in its charter)
Maryland
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001-14765
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251811499
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(State
or other jurisdiction of
incorporation)
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(Commission
File Number)
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(IRS
Employer Identification
No.)
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510
Walnut Street, 9th
Floor
Philadelphia,
Pennsylvania 19106
(Address
and zip code of
principal
executive offices)
Registrant’s
telephone number, including area code: (215)
238-1046
Check
the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instructions A.2. below):
o
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Written
communications pursuant
to Rule 425 under the Securities Act (17 CFR
230.425)
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o
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Soliciting
material pursuant to
Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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o
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Pre-commencement
communications
pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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o
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Pre-commencement
communications
pursuant to Rule 13e4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
1.01
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Entry
into a Material Definitive
Agreement.
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On
July
1, 2007, Hersha Hospitality Limited Partnership (“HHLP”), the operating
partnership of Hersha Hospitality Trust (“Hersha”), and 44 Norwich Manager LLC
entered into a Contribution Agreement (the “Contribution Agreement”) and closed
on the acquisition of 100% of the outstanding membership interests in 44 Hersha
Norwich Associates LLC, a Connecticut limited liability company (“LLC”) and the
owner of the land and improvements of the Holiday Inn Norwich situated at 10
Laura Boulevard, Norwich Connecticut (the “Holiday Inn”).
The
purchase price for the membership interests in the LLC was approximately $16.1
million, which included the assumption of approximately $8.2 million in existing
debt and the issuance of 659,312 units of limited partnership interest in HHLP
at a per unit value of $12.01, representing an aggregate value of approximately
$7.9 million. The existing debt includes both a first mortgage in an
outstanding principal amount of $5.2 million and a second mortgage in an
outstanding principal amount of $2.9 million. The first mortgage is
secured by a first lien on the Holiday Inn, matures on July 31, 2025 and bears
interest at a fixed rate of 6.75% per annum. The second mortgage is
secured by a second lien on the Holiday Inn, matures on September 26, 2027
and
bears interest at the prime rate plus 0.75% per annum.
Affiliates
of Hersha owned 65.8% of the membership interests in Hersha Norwich Associates,
LLC which owned 50.0% of the membership interests in the LLC. The
affiliates of Hersha selling their interests are Shree Associates (“Shree”),
Kunj Associates (“Kunj”), Trust FBO Neil H. Shah Under The Hasu and Hersha Shah
2004 Trust (“FBO Neil”), Trust FBO Jay H. Shah Under The Hasu and Hersha Shah
2004 Trust (“FBO Jay”), Shreenathji Enterprises, LTD (“SEL”), David L. Desfor
(“Desfor”) and Ashish R. Parikh (“Parikh” and collectively with Shree, Kunj, FBO
Neil, FBO Jay, SEL and Desfor, the “LLC Sellers”).
Hasu
P.
Shah, our Chairman of the Board of Trustees and former Chief Executive Officer,
is the manager of one of the LLC Sellers, Shree, and owns an interest in
SEL. Jay H. Shah, our Chief Executive Officer, is the beneficiary of
and a trustee of one of the LLC Sellers, FBO Jay, and owns an interest in
SEL. Neil H. Shah, our President and Chief Operating Officer, is the
beneficiary of and a trustee of one of the LLC Sellers, FBO Neil, and owns
an
interest in SEL. David L. Desfor is the Treasurer and Secretary of
Hersha. Kiran P. Patel, is a trustee of Hersha and is the manager of
one of the LLC Sellers, Kunj, and owns an interest in SEL. Ashish R.
Parikh is the Chief Financial Officer of Hersha. Each of these
trustees and executive officers, respectively, will receive a portion of the
proceeds of the transaction. As a related party transaction, the
transaction was approved by all of our independent trustees.
The
preceding description of the material terms of the Contribution Agreement is
qualified in its entirety by reference to the terms of the actual Contribution
Agreement, which is attached hereto as Exhibit 10.1 and incorporated by
reference herein.
Item
9.01
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Financial
Statements and Exhibits.
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(c)
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Exhibits.
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Exhibit
10.1
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Contribution
Agreement, dated as of July 1, 2007, by and among Hersha Norwich
Associates, LLC; Kirit Patel; Ashwin Shah; K&D Investment Associates,
L.L.C. and Hersha Hospitality Limited Partnership and 44 Norwich
Manager,
LLC.
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SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
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HERSHA
HOSPITALITY TRUST |
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Date: July
3, 2007
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By:
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/s/
Ashish R. Parikh
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Ashish R. Parikh
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Chief Financial Officer
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EXHIBIT
INDEX
Exhibit
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Description
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Contribution
Agreement, dated as of July 1, 2007, by and among Hersha Norwich
Associates, LLC; Kirit Patel; Ashwin Shah; K&D Investment Associates,
L.L.C. and Hersha Hospitality Limited Partnership and 44 Norwich
Manager,
LLC.
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