Interstate Closing of Public Offering

Interstate Hotels & Resorts, Inc. (NYSE: IHR), the nation`s largest independent hotel management company, today announced the closing of its offering of 8,500,000 shares of common stock, par value $0.01 per share, at a price per share of $5.25. An additional 500,000 shares were sold by selling stockholders. The net offering proceeds to Interstate of approximately $42.3 million will be used to repay indebtedness under its senior credit facility.
Citigroup Global Markets Inc. is acting as sole book-running manager in the offering, and the co-managers are Credit Lyonnais Securities (USA) Inc. and SG Cowen Securities Corporation. Interstate also has granted the underwriters an option to purchase an additional 1,350,000 shares to cover overallotments, which may be exercised by the underwriters until December 21, 2003.
A registration statement relating to these securities has been declared effective by the Securities and Exchange Commission. The offering is being made by means of a prospectus contained in that registration statement. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualifications under the securities laws of any such state.
Copies of the prospectus relating to the offering may be obtained from the offices of Citigroup Global Markets Inc., 388 Greenwich St., New York, NY 10013.
Interstate Hotels & Resorts operates more than 300 hospitality properties with nearly 67,000 rooms in 42 states, the District of Columbia, Canada and Russia. BridgeStreet Corporate Housing Worldwide, an Interstate Hotels & Resorts subsidiary, is one of the world`s largest corporate housing providers, offering upscale, fully furnished corporate housing throughout the United States, Canada, the United Kingdom, France and 39 additional countries through its network partners. For more information about Interstate Hotels & Resorts, visit Interstate`s Web site:
This press release contains “forward-looking statements,” within the meaning of the Private Securities Litigation Reform Act of 1995, about Interstate Hotels & Resorts, including those statements regarding future operating results and the timing and composition of revenues, among others, and statements containing words such as “expects,” “believes” or “will,” which indicate that those statements are forward-looking. Except for historical information, the matters discussed in this press release are forward-looking statements that are subject to certain risks and uncertainties that could cause the actual results to differ materially, including the current slowdown of the national economy, economic conditions generally and the real estate market specifically, the impact of the events of September 11, 2001, governmental actions, legislative and regulatory changes, availability of debt and equity capital, interest rates, competition, supply and demand for lodging facilities in our current and proposed market areas, and the company`s ability to manage integration and growth. Additional risks are discussed in Interstate Hotels & Resorts` filings with the Securities and Exchange Commission, including Interstate Hotels & Resorts annual report on Form 10-K for the year ended December 31, 2002.