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): May 11, 2005
HERSHA
HOSPITALITY TRUST
(Exact
name of registrant as specified in its charter)
|
Maryland |
001-14765 |
251811499 |
|
|
(State
or other jurisdiction of incorporation) |
(Commission
File Number) |
(IRS
Employer Identification No.) |
|
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):
|
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425) |
|
|
o |
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12) |
|
|
|
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b)) |
|
|
o |
Pre-commencement
communications pursuant to Rule 13e4(c) under the Exchange Act (17 CFR
240.13e-4(c)) |
ITEM
1.01 |
ENTRY
INTO A MATERIAL DEFINITIVE
AGREEMENT. |
On May
13, 2005, Hersha Hospitality Limited Partnership (the “Company”), the operating
partnership subsidiary of Hersha Hospitality Trust, and Hersha Statutory Trust
I, a Delaware trust formed by the Company on May 11, 2005 (the “Trust”),
completed the issuance and sale in a private placement of $25,000,000 aggregate
principal amount of fixed/floating rate preferred securities (the “Trust
Preferred Securities”) issued by the Trust. The Trust Preferred Securities
mature on June 30, 2035, are redeemable at the Company’s option beginning June
30, 2010, and require quarterly distributions of interest by the Trust to the
holder of the Trust Preferred Securities. Distributions will be payable
quarterly at a fixed interest rate equal to 7.34% per annum through June 30,
2010 and then will be payable at a variable interest rate equal to the London
Interbank Offered Rate (“LIBOR”) rate plus 3.0% per annum. The Trust
simultaneously issued 774 of the Trust’s common securities (the “Common
Securities”) to the Company for a purchase price of $774,000, which constitute
all of the issued and outstanding common securities of the Trust.
The Trust
used the proceeds from the sale of the Trust Preferred Securities together with
the proceeds from the sale of the Common Securities to purchase $25,774,000
aggregate principal amount of unsecured fixed/floating rate junior subordinated
notes due June 30, 2035 issued by the Company (the “Junior Subordinated Notes”).
The net proceeds to the Company from the sale of the Junior Subordinated Notes
to the Trust will be used by the Company for general corporate purposes,
including the acquisition of additional hotel properties.
The
Junior Subordinated Notes were issued pursuant to a Junior Subordinated
Indenture, dated May 13, 2005 (the “Indenture”), between the Company and
JPMorgan Chase Bank, N.A., as trustee. The terms of the Junior Subordinated
Notes are substantially the same as the terms of the Trust Preferred Securities.
The interest payments on the Junior Subordinated Notes paid by the Company will
be used by the Trust to pay the quarterly distributions to the holders of the
Trust Preferred Securities. The Indenture permits the Company to redeem the
Junior Subordinated Notes (and thus a like amount of the Preferred Trust
Securities) on or after June 30, 2010. If the Company redeems any amount of the
Junior Subordinated Notes, the Trust must redeem a like amount of the Trust
Preferred Securities.
The terms
of the Trust Preferred Securities are governed by an Amended and Restated Trust
Agreement, dated May 13, 2005 (the “Trust Agreement”), among the Company, as
depositor, JPMorgan Chase Bank, N.A., as property trustee, Chase Bank USA, N.A.,
as Delaware trustee, the Administrative Trustees named therein and the holders
from time to time of undivided beneficial interests in the assets of the Trust.
Under the terms of the Trust Preferred Securities, an event of default generally
occurs upon:
|
· |
non-payment
of interest on the Junior Subordinated Notes when it becomes due and
payable, and continuance of the default for a period of 30 days;
|
|
· |
non-payment
of the principal of, or any premium on, the Junior Subordinated Notes at
their maturity; |
|
· |
the
Company’s failure to comply with its covenants or certain other provisions
of the Indenture, which failure continues for a period of 30 days after
the Company receives notice of such failure;
|
|
· |
non-payment
of any distribution on the Trust Securities when it becomes due and
payable, and continuance of the default for a period of 30 days;
|
|
· |
non-payment
of the redemption price of any Trust Security when it becomes due and
payable; |
|
· |
the
Trustee’s failure to comply in any material respect with any covenants or
certain other provisions of the Trust Agreement, which failure continues
for a period of 30 days after the Trustees and the Company receive notice
of such failure; or |
|
· |
bankruptcy
or liquidation of the Company or of the Trust.
|
The
offering of the Trust Preferred Securities was conducted pursuant to a Purchase
Agreement, dated as of May 11, 2005 (the “Purchase Agreement”), among the
Company, the Trust and Merrill Lynch International, as the initial purchaser.
The
preceding discussion is qualified in its entirety by reference to the terms of
the Indenture, the Trust Agreement, the Junior Subordinated Notes, the Trust
Preferred Securities and the Purchase Agreement. Copies of the Indenture, the
Trust Agreement, the form of security representing the Junior Subordinated
Notes, the form of Trust Preferred Securities Certificate and the Purchase
Agreement are attached hereto as Exhibits 4.1, 4.2, 4.3, 4.4 and 10.1,
respectively, and incorporated herein by reference.
ITEM
2.03 |
CREATION
OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN OFF-BALANCE
SHEET ARRANGEMENT OF A REGISTRANT. |
The
information required by this item is included in Item 1.01 and incorporated
herein by reference.
ITEM
3.02 |
UNREGISTERED
SALES OF EQUITY SECURITIES. |
The
information required by this item is included in Item 1.01 and incorporated
herein by reference.
All of
the securities described in Item 1.01 were issued in a private placement exempt
from registration under Section 4(2) of the Securities Act of 1933, as amended,
and/or Regulation D promulgated thereunder.
ITEM
9.01 FINANCIAL
STATEMENTS AND EXHIBITS.
|
4.1 |
Junior
Subordinated Indenture, dated as of May 13, 2005, between the Company and
JPMorgan Chase Bank, National Association, as
trustee. |
|
4.2 |
Amended
and Restated Trust Agreement, dated as of May 13, 2005, among the Company,
as depositor, JPMorgan Chase Bank, National Association, as property
trustee, Chase Bank USA, National Association, as Delaware trustee, the
Administrative Trustees named therein and the holders of undivided
beneficial interests in the assets of the
Trust. |
|
4.3 |
Form
of Junior Subordinated Note (included in Exhibit 4.1
hereto). |
|
4.4 |
Form
of Trust Preferred Security Certificate (included in Exhibit 4.2
hereto). |
|
10.1 |
Purchase
Agreement, dated as of May 11, 2005, among the Company, the Trust and
Merrill Lynch International. |
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.
|
|
|
|
HERSHA
HOSPITALITY TRUST |
|
|
|
Date: May 17,
2005 |
By: |
/s/ Ashish R.
Parikh |
|
Ashish R. Parikh |
|
Chief Financial
Officer |
EXHIBIT
INDEX
|
4.1 |
Junior
Subordinated Indenture, dated as of May 13, 2005, between the Company and
JPMorgan Chase Bank, National Association, as
trustee. |
|
4.2 |
Amended
and Restated Trust Agreement, dated as of May 13, 2005, among the Company,
as depositor, JPMorgan Chase Bank, National Association, as property
trustee, Chase Bank USA, National Association, as Delaware trustee, the
Administrative Trustees named therein and the holders of undivided
beneficial interests in the assets of the
Trust. |
|
4.3 |
Form
of Junior Subordinated Note (included in Exhibit 4.1
hereto). |
|
4.4 |
Form
of Trust Preferred Security Certificate (included in Exhibit 4.2
hereto). |
|
10.1 |
Purchase
Agreement, dated as of May 11, 2005, among the Company, the Trust and
Merrill Lynch International. |