Hersha Hospitality Trust Provides Capital Allocation Update

- $200 Million Unsecured Notes Placement -
- Successfully Amends Senior Credit Facility -
- Covenant Waivers Extended Through March 31, 2022 -
- Binding Sales Agreements on Six Hotels Totaling $216 Million -

PHILADELPHIA, Feb. 17, 2021 (GLOBE NEWSWIRE) -- Hersha Hospitality Trust (NYSE: HT) (“Hersha” or the “Company”), owner of high-quality hotels in urban gateway markets and regional resort destinations, today announced it secured a strategic financing commitment from West Street Strategic Solutions Fund I, L.P. and Broad Street Credit Holdings LLC, each of which is an affiliate of the Merchant Banking business of The Goldman Sachs Group, Inc. (the “GS Purchasers”).

Private Notes Placement
The unsecured notes facility the Company entered into with the GS Purchasers will provide an initial $150 million draw at closing and an incremental $50 million delayed draw that can be drawn at the Company’s discretion in minimum installments of $25 million at any point on or prior to September 30, 2021. Additionally, the notes facility includes other features that provide the Company flexibility well into the recovery:

• Five-year term maturing in February 2026
• Interest rate of 9.50%, 4.75% cash pay and 4.75% payment-in-kind through March 31, 2022
• Non-callable in year 1, redeemable at 104% beginning in February 2022, 102% beginning in February 2023 and at par any time beginning in February 2024     
• Incurrence-based covenants using metrics in-line with the amended revolving credit facility
• Creates flexibility well into the recovery enabling the Company to execute its strategic and operating plan
  

Revolving Credit Facility and Term Loans Amended
The Company successfully executed amendments to its revolving credit facility and term loan facilities with its bank group in conjunction with the financing commitment from the GS Purchasers and recently announced dispositions. The amended revolving credit facility:  

• Eliminates term loan maturities until August 2022
• Waives all financial covenants through March 31, 2022
• Establishes accommodative covenant testing methodology through December 31, 2022 for operational and financial flexibility
• Enables the Company to pay down the accrual of the Company’s preferred dividends and keep them current
• Provides additional liquidity at the Company’s discretion