La Quinta Properties, Inc. and La Quinta Corporation (NYSE: LQI) (“La Quinta” or the “Company”) announced today that La Quinta Properties, Inc. has entered into an agreement to sell in a private placement $325 million in senior notes due 2011 at 8 7/8%. The closing of the sale of the senior notes is expected to occur this week, subject to customary closing conditions. The senior notes will rank pari-parsu with the Company’s existing senior notes and will be guaranteed by La Quinta Corporation.
La Quinta expects to use the net proceeds to fund tender offers for any or all of the tendered portion of the Company’s 7.82% notes (puttable in 2003) due 2026, 7.51% medium term notes due 2003 and 7.25% senior notes due 2004, as well as the 7.114% Exercisable Put Option Securities due 2004 as announced by the Company on March 5, 2003. La Quinta also expects to use the net proceeds to fund senior notes maturing or puttable in 2003 and 2004 that were not tendered, repay borrowings under the Company’s revolving credit facility and for general corporate purposes.
This announcement is neither an offer to sell nor a solicitation of an offer to buy any of these securities. The securities described in this release have not been registered under the Securities Act of 1933, as amended, or any state securities laws, and may not be offered or sold in the United States absent an effective registration statement covering such securities or an applicable exemption for such registration requirements.