FelCor tenders for 9½ % notes

New York, June 28 - FelCor Lodging Trust Inc. said its subsidiary, FelCor Lodging LP (B1/B-), has begun a cash tender offer for up to $115 million principal amount of its outstanding 9½% senior notes due 2008 (interest rate on the notes is currently stepped up to 10%).

It set an early tender deadline of 5 p.m. ET July 12 and said the tender offer would expire at midnight ET July 26, with both deadlines subject to possible extension.

It said that holders who validly tender their notes by the early tender deadline will receive the total consideration of $1,061.62 per $1,000 principal amount of notes tendered and accepted for purchase by the company. That total consideration will include an early tender premium of $20 per $1,000 principal amount. Holders who validly tender their notes after the early tender deadline but before the offer expires will receive only the tender consideration of $1,041.62 per $1,000 principal amount and will not receive the early tender premium.

FelCor intends to fund the tender offer with the net proceeds from its planned private placement of $115 million of new senior floating-rate notes due 2011 and with available cash.

FelCor announced on May 26 that it had accepted and purchased $247.1 million principal amount of its 9½% notes out of $515 million tendered by holders in a previous tender offer.

Deutsche Bank Securities Inc. is acting as dealer manager for the latest tender offer (call 212 250-4270). MacKenzie Partners Inc. is the information agent (call collect at 212 929-5500 or 800 322-2885).

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