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Prime Hospitality Corp. Announces Cash Tender Offer and Related Consent Solicitation for its 8-3/8% Senior Subordinated Notes due 2012 FAIRFIELD, N.J., Sept. 9 /PRNewswire-FirstCall/ -- Prime Hospitality Corp. (NYSE:PDQ) announced today that it had commenced a cash tender offer to purchase any and all of its outstanding 8-3/8% Senior Subordinated Notes due 2012 (the "Notes") (CUSIP No. 741917AJ7), as well as a related consent solicitation to amend the Notes and the indenture pursuant to which they were issued. The tender offer and consent solicitation are being conducted in connection with Prime Hospitality's previously announced agreement to merge with an affiliate of The Blackstone Group. The consent solicitation will expire at 5:00 p.m., New York City time, on Wednesday, September 22, 2004, unless extended or amended by the Company. Tendered Notes may not be withdrawn and consents may not be revoked after the consent expiration date. The tender offer will expire at 8:00 a.m., New York City time, on Friday, October 8, 2004, unless extended or earlier terminated by the Company. Holders tendering their Notes will be required to consent to proposed amendments to the Notes and to the indenture governing the Notes, which will eliminate substantially all of the restrictive covenants and certain events of default, amend the merger and consolidation covenant and make changes to the defeasance provisions. Holders may not tender their Notes without also delivering consents or deliver consents without also tendering their Notes. The total consideration to be paid for each $1,000 principal amount of Notes will be a price equal to the present value, as of the payment date for such Notes purchased in the tender offer, of the earliest redemption price for such Notes ($1,041.88) and interest that would accrue on such Notes from the payment date up to, but not including the earliest redemption date (May 1, 2007), calculated based on (A) the yield to maturity on the 4.375% U.S. Treasury Note due May 15, 2007, as calculated by Banc of America Securities LLC in accordance with standard market practice, based on the bid price of such reference security as of 2:00 p.m., New York City time, on the tenth business day immediately preceding the Tender Offer Expiration Date, as displayed on Bloomberg Government Pricing Monitor on "Page PX5" or any recognized quotation source selected by Banc of America Securities LLC in its sole discretion, plus (B) 50 basis points. Holders whose Notes are accepted for payment will also be paid accrued and unpaid interest up to, but not including the date of payment for the Notes. The total consideration includes a consent payment of $30.00 per $1,000 principal amount of the Notes which will be payable only in respect of the Notes purchased that are tendered on or prior to the consent expiration date. Holders who tender their Notes after the consent expiration date will not be entitled to receive the consent payment. The tender offer and consent solicitation are made upon the terms and conditions set forth in the Offer to Purchase and Consent Solicitation Statement, dated September 9, 2004 and the related Consent and Letter of Transmittal. The tender offer and consent solicitation are subject to the satisfaction of certain conditions, including receipt of consents sufficient to approve the proposed amendments and the merger having occurred or occurring substantially concurrent with the tender offer expiration date. The purpose of the tender offer is to acquire all outstanding Notes in connection with the merger. The purpose of the consent solicitation is to, among other things, amend the Notes and the indenture governing the Notes to eliminate substantially all of the restrictive covenants and certain events of default, amend the merger and consolidation covenant and make changes to the defeasance provisions (and make related changes in the Notes). Prime Hospitality has retained Banc of America Securities LLC and Bear, Stearns & Co. Inc. to act as the Dealer Managers for the tender offer and Solicitation Agents for the consent solicitation. Banc of America Securities LLC can be contacted at (888) 292-0070 (toll free) and (704) 388-9217 and Bear, Stearns & Co. Inc. can be contacted at (877) 696-BEAR (toll free). The tender offer and consent solicitation documents are expected to be distributed to holders beginning today. Requests for documentation may be directed to D.F. King & Co., Inc., the Information Agent, which can be contacted at (212) 269- 5550 (for banks and brokers only) and (800) 628-8532 (for all others toll free). This release is for informational purposes only and is neither an offer to purchase nor a solicitation of an offer to sell the Notes. The offer to buy the Notes is only being made pursuant to the tender offer and consent solicitation documents, including the Offer to Purchase and Consent Solicitation Statement that Prime Hospitality is distributing to Noteholders. The tender offer and consent solicitation are not being made to Noteholders in any jurisdiction in which the making or acceptance thereof would not be in compliance with the securities, blue sky or other laws of such jurisdiction. In any jurisdiction in which the tender offer or consent solicitation are required to be made by a licensed broker or dealer, they shall be deemed to be made by Banc of America Securities LLC or Bear, Stearns & Co. Inc. on behalf of the Company. DATASOURCE: Prime Hospitality Corp. CONTACT: Richard Szymanski of Prime Hospitality Corp., +1-973-808-7751 Web site: http://www.primehospitality.com/ Company News On-Call: http://www.prnewswire.com/comp/130238.html

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