- Free Writing Prospectus - Filing under Securities Act Rules 163/433 (FWP)
May 11 2011 - 4:49PM
Edgar (US Regulatory)
Dated May 11, 2011
Filed Pursuant to Rule 433
Registration Statement No. 333-174029
Relating to Preliminary Prospectus Supplement
Dated May 10, 2011 to Prospectus Dated May 6, 2011
HERSHA HOSPITALITY TRUST
8.00% Series B Cumulative Redeemable Preferred Shares
(Liquidation Preference $25.00 per share)
FINAL PRICING TERMS
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Issuer:
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Hersha Hospitality Trust
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Title of Shares:
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8.00% Series B Cumulative Redeemable Preferred Shares
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Number of Shares:
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4,000,000 Shares
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Overallotment Option:
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600,000 Shares
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Maturity:
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The Series B Preferred Shares do not have any stated
maturity date, and the issuer is not required to
redeem these shares. Accordingly, the Series B
Preferred Shares will remain outstanding
indefinitely unless the issuer decides to redeem
them or repurchase shares in the open market, in
each case, at the issuers option, subject to the
restrictions on redemption described herein. The
issuer is not required to set aside funds to redeem
the Series B Preferred Shares.
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Trade Date:
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May 11, 2011
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Settlement Date:
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May 18, 2011 (T+5)
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Dividend Rate:
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8.00% per annum of the $25.00 liquidation preference
(equivalent to $2.00 per annum per share)
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Dividend Payment Dates:
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January 15, April 15, July 15 and October 15,
commencing July 15, 2011
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Optional Redemption:
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The issuer may not redeem the Series B Preferred
Shares prior to May 18, 2016, except as described
below under Special Optional Redemption and in
limited circumstances relating to the issuers
continuing qualification as a REIT. On and after May
18, 2016, the issuer may redeem the Series B
Preferred Shares for cash at its option, in whole or
in part, at any time and from time to time, by
paying $25.00 per share, plus all accrued and unpaid
dividends to the redemption date.
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Special Optional Redemption:
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Upon the occurrence of a Change of Control (as
defined below), the issuer may, at its option,
redeem the Series B Preferred Shares, in whole or in
part and within 120 days after the first date on
which such Change of Control occurred, by paying
$25.00 per share, plus all accrued and unpaid
dividends to the redemption date. If, prior to the
Change of
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Control Conversion Date (as defined
below), the issuer exercises any of its redemption
rights relating to the Series B Preferred Shares
(whether the optional redemption right or the
special optional redemption right), holders of the
Series B Preferred Shares will not have the
conversion right described below.
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A Change of Control is when, after the original
issuance of the Series B Preferred Shares, the
following have occurred and are continuing:
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▪
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the acquisition by any person, including any
syndicate or group deemed to be a person under
Section 13(d)(3) of the Securities Exchange Act of
1934, as amended (the Exchange Act), of beneficial
ownership, directly or indirectly, through a
purchase, merger or other acquisition transaction or
series of purchases, mergers or other acquisition
transactions of shares of the issuer entitling that
person to exercise more than 50% of the total voting
power of all shares of the issuer entitled to vote
generally in elections of trustees (except that such
person will be deemed to have beneficial ownership
of all securities that such person has the right to
acquire, whether such right is currently exercisable
or is exercisable only upon the occurrence of a
subsequent condition); and
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▪
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following the closing of any transaction
referred to in the bullet point above, neither the
issuer nor the acquiring or surviving entity has a
class of common securities (or American Depositary
Receipts representing such securities) listed on the
New York Stock Exchange (NYSE), the NYSE Amex, or
the NASDAQ Stock Market (NASDAQ) or listed or
quoted on an exchange or quotation system that is a
successor to the NYSE, the NYSE Amex or NASDAQ.
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The Change of Control Conversion Date is the date
fixed by the board of trustees of the issuer, in its
sole discretion, as the date the Series B Preferred
Shares are to be converted, which will be a business
day that is no fewer than 20 days nor more than 35
days after the date on which the issuer provides
notice of a Change of Control to holders of the
Series B Preferred Shares.
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Conversion Rights:
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Except as described below in connection with a
Change of Control, the Series B Preferred Shares are
not convertible into or exchangeable for any other
securities or property.
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Change of Control Rights:
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Upon the occurrence of a Change of Control, each
holder of Series B Preferred Shares will have the
right (unless, prior to the Change of Control
Conversion Date, the issuer provides notice of its
election to redeem the Series B Preferred Shares)
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2
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to
convert some or all of the Series B Preferred Shares
held by such holder on the Change of Control
Conversion Date into a number of the issuers common
shares per Series B Preferred Share to be converted
equal to the lesser of:
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▪
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the quotient obtained by dividing (i) the
sum of the $25.00 liquidation preference plus the
amount of any accrued and unpaid dividends to the
Change of Control Conversion Date (unless the Change
of Control Conversion Date is after a record date
for a Series B Preferred Share dividend payment and
prior to the corresponding Series B Preferred Share
dividend payment date, in which case no additional
amount for such accrued and unpaid dividend will be
included in this sum) by (ii) the Common Share Price
(as defined below); and
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▪
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8.2237 (i.e., the Share Cap), subject to
certain adjustments.
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The Common Share Price will be: (i) the amount of
cash consideration per common share, if the
consideration to be received in the Change of
Control by the holders of the issuers common shares
is solely cash; and (ii) the average of the closing
prices for the issuers common shares on the NYSE
for the ten consecutive trading days immediately
preceding, but not including, the effective date of
the Change of Control, if the consideration to be
received in the Change of Control by the holders of
the issuers common shares is other than solely
cash.
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Public Offering Price:
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$25.00 per share
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Purchase Price by Underwriters:
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$24.2125 per share
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Net Proceeds (before expenses):
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$96,850,000 ($111,377,500 if the underwriters
exercise their overallotment option in full)
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Underwriting Discount:
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$3,150,000 ($3,622,500 if the
underwriters exercise their overallotment option in full)
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Joint Book-Running Managers:
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Merrill Lynch, Pierce, Fenner & Smith Incorporated
Barclays Capital Inc.
Morgan Stanley & Co. Incorporated
Raymond James & Associates, Inc.
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Co-Lead Managers:
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Robert W. Baird & Co. Incorporated
Deutsche Bank Securities Inc.
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Co-Managers
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FBR Capital Markets & Co.
Janney Montgomery Scott LLC
JMP Securities LLC
Keefe, Bruyette & Woods, Inc.
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3
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Listing/Symbol:
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NYSE / HT PRB
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ISIN:
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US4278253020
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CUSIP:
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427825 302
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The issuer has filed a registration statement (including a prospectus dated May 6, 2011 and a
preliminary prospectus supplement dated May 10, 2011) with the SEC for the offering to which this
communication relates. Before you invest, you should read the prospectus in that registration
statement, the related preliminary prospectus supplement and other documents the issuer has filed
with the SEC for more complete information about the issuer and this offering. You may get these
documents for free by visiting EDGAR on the SEC Web site at
www.sec.gov
. Alternatively, the
issuer, any underwriter or any dealer participating in the offering will arrange to send you the
prospectus and preliminary prospectus supplement if you request it by calling Merrill Lynch,
Pierce, Fenner & Smith Incorporated toll-free at 1-800-294-1322, Barclays Capital Inc. at
1-888-603-5847, Morgan Stanley & Co. Incorporated at 1-866-718-1649 or Raymond James & Associates,
Inc. toll-free
at 1-800-248-8863.
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