La Quinta buys back all 7.114% put option notes after third-party call exercised

New York, Aug. 17 - La Quinta Properties Inc. said it exercised its right to buy back all its 7.114% exercisable put option notes due 2011 after a third party holding a call exercised that option.

La Quinta paid $171.399 million for the securities, equal to the sum of the present value of the remaining scheduled payments of principal and interest.

The notes were issued in 1997 by a trust created by a predecessor company of La Quinta Properties, according to an 8-K filing with the Securities and Exchange Commission.

As part of the original sale, a third party was sold a call option to buy the notes at par. The $150 million principal amount would then be distributed to the holders of the notes.

If the call was exercised, La Quinta had the option to buy back the notes from the call holder.

The call was exercised and La Quinta in turn exercised its option on Aug. 16, according to the 8-K filing.

La Quinta added that it already owned $122.175 million of the notes.

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