DALLAS and TORONTO, April 29, 2020 /CNW/ -- NexPoint Hospitality Trust ("NHT") (TSX-V: NHT.U) announced today that it will be relying on Ontario Instrument 51-502 – Temporary Exemption from Certain Corporate Finance Requirements in respect of its obligation to file its annual financial statements required by subsection 4.2(b) of National Instrument 51-102 – Continuous Disclosure Obligations ("NI 51-102") and its annual management's discussion and analysis required by subsection 5.1(2) of NI 51-102. NHT's management expects that the annual financial statements and annual management's discussion and analysis will be filed on or about June 12, 2020.  NHT's management and other insiders are subject to an insider trading black-out policy that reflects the principles in section 9 of National Policy 11-207 – Failure-to-File Cease Trade Orders and Revocations in Multiple Jurisdictions.

Since the filing of NHT's interim financial statements on November 25, 2019, there have been several material business developments:

• The current COVID-19 pandemic has led to an unprecedented response from all levels of government in the U.S. and around the world which has resulted in a near shut down of non-essential components of the global economy. One of the sectors most severely impacted is the lodging industry. NHT is closely monitoring the impact of the COVID-19 pandemic on its operations. To date, NHT has reduced staffing at its properties, stopped all non-essential capital expenditure programs, reviewed all expense line items to identify additional cash outflows that can be reduced or eliminated in the near term and has begun active discussions with lenders. Currently, all 11 of NHT's properties remain open for business. The extent of the future impacts on the portfolio is uncertain but NHT has experienced material declines in revenue, net income and cash flows. NHT's hotel operator is working diligently to respond to evolving occupancy levels. In addition, NexPoint Real Estate Advisors VI, L.P., the external manager of NHT, has waived the payment of advisory fees by NHT indefinitely. NHT's hotel brand partners have been accommodating during this crisis.
• As previously announced on March 25, 2020, in light of the recent reduction in business levels due to the impact of the COVID-19 pandemic and NHT's strategic focus on cash conservation and unitholder value preservation, NHT temporarily suspended quarterly distributions.
• As of December 31, 2019, NHT had a working capital deficit related primarily to the maturity of a $35,000 mezzanine loan (the "Mezzanine Facility") due on January 8, 2020. NHT exercised its right to extend the Mezzanine Facility after December 31, 2019 to April 8, 2020 and subsequently the lender granted an additional 30-day extension to May 8th, 2020. NHT is in active discussions with the lender under the Mezzanine Facility to restructure the balance due.
• NHT Operating Partnership, LLC (the "OP"), the operating partnership of NHT, and Condor Hospitality Trust, Inc. ("Condor") continue to discuss the previously announced acquisition of Condor by the OP (the "Merger"). On December 18, 2019, the OP and Condor agreed to extend the closing of the Merger to January 31, 2020. On January 31, 2020, the OP and Condor agreed to further extend the closing of the Merger to February 28, 2020, subject to further possible extension to March 16, 2020. On February 21, 2020, the OP and Condor agreed to further extend the closing of the Merger to March 16, 2020. On March 15, 2020, the OP and Condor agreed to further extend the closing of the Merger to March 23, 2020. As of the date of this release, the closing of the Merger has not occurred and the OP and Condor are in discussions to restructure the transaction. Because of the unprecedented events transpiring as a result of the COVID-19 pandemic, that are no assurances that the Merger will in fact close.

About NexPoint Hospitality Trust

NexPoint Hospitality Trust is a publicly traded real estate investment trust, with its units listed on the TSX Venture Exchange under the ticker NHT.U. NHT is focused on acquiring, owning and operating well located hospitality properties in the United States that offer a high current yield and in many cases, that are underperforming assets with the potential to increase in value through investments in capital improvements, a market-based recovery, brand repositioning, revenue enhancements, operational improvements, reducing expense inefficiencies, and exploiting excess land or underutilized space. NHT owns 11 branded properties sponsored by Marriott, Hilton and InterContinental Hotels Group, located across the U.S., specifically in the Seattle, Portland, Dallas, Nashville and St. Petersburg markets. NHT is externally advised by NexPoint Real Estate Advisors VI, L.P. For more information, visit www.nexpointhospitality.com.

Cautionary Statement Regarding Forward-Looking Information

Certain statements in this press release may constitute "forward-looking" information that involves known and unknown risks, uncertainties and other factors, and it may cause actual results, performance or achievements or industry results, to be materially different from any future results, performance or achievements or industry results expressed or implied by such forward-looking information. Forward-looking information is identified by the use of terms and phrases such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "predict", "project", "will", "would", and similar terms and phrases, including references to assumptions. In particular, the expected funding and closing of the Merger and the impact of the COVID-19 pandemic on NHT's business constitute forward-looking information.

Forward-looking information contained in this press release is based on certain key expectations and assumptions by NHT. Although the forward-looking information contained in this press release is based upon what NHT's management believes to be reasonable assumptions, NHT cannot assure investors that actual results will be consistent with such information. Forward-looking information reflects current expectations of management regarding future events and operating performance as of the date of this press release. Such information involves significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking information, and a description of these factors can be found under "Risk Factors" in NHT's final prospectus dated March 27, 2019, Management's Discussion and Analysis dated November 25, 2019, and base shelf prospectus dated November 15, 2019, which are available on SEDAR (www.sedar.com).

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact: 

Investor Relations
Jackie Graham
972-628-4024
[email protected]

Chief Financial Officer
Brian Mitts
972-419-2556
[email protected]

Media Inquiries
[email protected] 

SOURCE NexPoint Hospitality Trust

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