Candlewood Hotel Company Closes Second Tranche of Convertible Preferred Stock.WICHITA, Kan.--(BUSINESS WIRE)--Aug. 4, 1998--Candlewood Hotel Company, Inc. (Nasdaq NM: CNDL), the Wichita, Kan.-based owner, developer, manager and franchisor of value-oriented, business extended-stay hotels, today announced that it has completed the $42 million private placement of its Series B Cumulative Convertible Preferred Stock Convertible Preferred Stock Preferred stock that includes an option for the holder to convert the preferred shares into a fixed number of common shares, usually anytime after a predetermined date. Also known as "convertible preferred shares". and warrants to purchase its common stock. The first closing of approximately $39 million was completed on July 13, 1998, and the second closing of approximately $3 million was completed on August 3, 1998. The proceeds of the offering will be used for the continued development of the Company's hotels and other general corporate purposes. The Preferred Stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. is entitled en·ti·tle tr.v. en·ti·tled, en·ti·tling, en·ti·tles 1. To give a name or title to. 2. To furnish with a right or claim to something: to a 7.5 percent annual dividend and to convert into common stock of the Company at $9.50 per share, which represents a 27 percent premium over the closing price of Candlewood's common stock as of the commitment date, June 30, 1998. The Company will be able to redeem redeem v. to buy back, as when an owner who had mortgaged his/her real property pays off the debt. The term also refers to paying the amount due and all charges after a foreclosure (due to failure to make payments when due) has begun. the preferred stockafter September 30, 1999, and will be required to redeem the preferred stock on September 30, 2004. The warrants are exercisable into common stock at $12.00 per share and expire on July 13, 2005. The securities have not been registered under the Securities Act of 1933, as amended, or applicable state securities laws, and may not be offered or sold in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. absent registration under such Act or an applicable exemption from the registration requirements. This announcement does not constitute an offer to sell or the solicitation solicitation In criminal law, the act of asking, inducing, or directing someone to commit a crime. The person soliciting another becomes an accomplice to the crime. The term also refers to the act of obtaining bribes, as well as to the crime of a prostitute who offers sexual of orders to buy any of the Series B Preferred Stock.
CONTACT: Candlewood Hotel Company, Inc.
Warren Fix, Chief Financial Officer, 316/631-1300
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