Filed Pursuant to Rule 424(b)(5)
File No. 333-43573
PROSPECTUS SUPPLEMENT
(To Prospectus Dated January 15, 1998)
1,361,059 Shares
Hospitality Properties Trust
Common Shares of Beneficial Interest
Hospitality Properties Trust (the "Company") is a real estate
investment trust (a "REIT"), which owns hotels and leases them to unaffiliated
tenants. The Company's common shares of beneficial interest (the "Shares")
offered hereby (the "Offering") are being issued and sold by the Company. The
Shares are traded on the New York Stock Exchange (the "NYSE") under the symbol
"HPT." On April 21, 1998 the last reported sale price for the Shares on the NYSE
was $33.0625 per Share.
A.G. Edwards & Sons, Inc. (the "Underwriter") has agreed to purchase
the Shares offered hereby from the Company at a price of $31.4125 per share,
resulting in aggregate proceeds to the Company of $42,704,266, after deducting
estimated expenses of $50,000 payable by the Company, subject to the terms and
conditions set forth in the Underwriting Agreement. The Underwriter intends to
sell the Shares to Nike Securities L.P. ("Nike Securities") for an aggregate
price of $43,204,232. Nike Securities intends to deposit the Shares, together
with shares of common stock of other entities also acquired from the
Underwriter, with the trustee of a newly formed unit investment trust registered
under the Investment Company Act of 1940, as amended (the "Trust"), in exchange
for units in the Trust. The Company has agreed to indemnify the Underwriter
against certain liabilities, including liabilities under the Securities Act of
1933, as amended (the "Securities Act"). See "Underwriting."
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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The Shares offered hereby are offered by the Underwriter subject to
prior sale, when, as and if accepted by the Underwriter and subject to certain
conditions. It is expected that delivery of the Shares will be made on or about
April 24, 1998, at the offices of A.G. Edwards & Sons, Inc., New York, New York.
A.G. Edwards & Sons, Inc.
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The date of this Prospectus Supplement is April 21, 1998.
<PAGE>
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN
TRANSACTIONS THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE
SHARES. SPECIFICALLY, THE UNDERWRITER MAY BID FOR, AND PURCHASE, SHARES IN THE
OPEN MARKET. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE "UNDERWRITING."
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THE COMPANY
The Company is a REIT which acquires, owns and leases hotels to
unaffiliated hotel operators. At April 15, 1998, the Company owned or had
commitments to acquire 150 hotels with 21,255 rooms or suites in 35 states, for
approximately $1.62 billion of total investments. In the ordinary course of its
business, the Company regularly evaluates investment opportunities and enters
letters of intent and contracts to purchase and lease real estate. Several such
investment opportunities are under active consideration by the Company and at
one stage or another of the Company's investment approval process. No assurances
can be given that any of these investments will be consummated.
The Company is organized as a Maryland real estate investment trust;
its principal executive offices are located at 400 Centre Street, Newton,
Massachusetts 02158; and its telephone number is (617) 964-8389.
USE OF PROCEEDS
The net proceeds to the Company from the sale of the Shares offered
hereby, after payment of expenses related to this offering, will be
approximately $42,704,266. The net proceeds are expected to be used to purchase
hotels and for other general business purposes. Until the proceeds of this
Offering are used, they will be deposited in interest-bearing accounts or
invested in short-term securities, including securities which may not be
investment grade rated.
UNDERWRITING
Subject to the terms and conditions contained in an Underwriting
Agreement dated April 21, 1998 (the "Underwriting Agreement"), between the
Company and the Underwriter, the Company has agreed to sell to the Underwriter,
and the Underwriter has agreed to purchase from the Company, 1,361,059 Shares at
the offering price set forth on the cover page of this Prospectus Supplement.
The Underwriting Agreement provides that the Underwriter's obligation to
purchase the Shares is subject to the satisfaction of certain conditions,
including the receipt of certain legal opinions. The nature of the Underwriter's
obligation is such that it is committed to purchase all of the Shares offered
hereby if any Shares are purchased.
The Underwriter intends to sell all of the Shares offered hereby to
Nike Securities which intends to deposit the Shares along with shares of common
stock of other entities purchased from the Underwriter, with the trustee of the
Trust in exchange for units in the Trust. The Underwriter is not an affiliate of
Nike Securities or the Trust. The Underwriter intends to sell the Shares to Nike
Securities at an aggregate purchase price of $43,204,232. It is anticipated that
the Underwriter will also participate in the distribution of the units in the
Trust and will receive compensation therefor. The Shares are listed on the New
York Stock Exchange under the symbol "HPT."
Pursuant to the Underwriting Agreement, the Company has agreed to
indemnify the Underwriter against certain liabilities, including liabilities
under the Securities Act of 1933, as amended, or to contribute to payments the
Underwriter may be required to make in respect thereof.
Until the distribution of the Shares offered hereby is completed, rules
of the Securities and Exchange Commission may limit the ability of the
Underwriter to bid for and purchase Shares. As an exception to these rules, the
Underwriter is permitted to engage in certain transactions that stabilize the
price of the Shares. Such transactions consist of bids or purchases for the
purpose of pegging, fixing or maintaining the price of the Shares. It is not
currently anticipated that the Underwriter will engage in any such transactions
in connection with this offering.
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If the Underwriter creates a short position in the Shares in connection
with this offering, i.e., if it sells more Shares than are set forth on the
cover page of this Prospectus Supplement, the Underwriter may reduce that short
position by purchasing Shares in the open market.
In general, purchases of a security for the purpose of stabilization or
to reduce a short position could cause the price of the security to be higher
than it might be in the absence of such purchases.
Neither the Company nor the Underwriter makes any representation or
prediction as to the direction or magnitude of any effect that the transactions
described above might have on the price of the Shares. In addition, neither the
Company nor the Underwriter makes any representation that the Underwriter will
engage in such transactions or that such transactions, once commenced, will not
be discontinued without notice.
In the ordinary course of business, the Underwriter may from time to
time provide investment banking, financial advisory and commercial banking
services to the Company and its affiliates for which customary compensation will
be received.
LEGAL MATTERS
Certain legal matters with respect to the Shares offered by the Company
have been passed upon for the Company by Sullivan & Worcester LLP, Boston,
Massachusetts and will be passed upon for the Underwriter by Chapman and Cutler,
Chicago, Illinois. Sullivan & Worcester LLP and Chapman and Cutler will rely, as
to certain matters of Maryland law, upon the opinion of Ballard Spahr Andrews &
Ingersoll, LLP, Baltimore, Maryland. Barry M. Portnoy was a partner in the firm
of Sullivan & Worcester LLP until March 31, 1997 and is a Managing Trustee of
the Company and of Health and Retirement Properties Trust ("HRPT") and director
and a 50% owner of REIT Management & Research, Inc. (the "Advisor"), the
investment advisor to the Company. Sullivan & Worcester LLP represents HRPT, the
Advisor and certain of their affiliates on various matters.
EXPERTS
In addition to the matters referred to in the accompanying Prospectus
under the caption "Experts," the (i) consolidated financial statements and
related schedule of the Company for the years ended December 31, 1997, 1996 and
1995 appearing in the Company's Current Report on Form 8-K dated February 11,
1998 and (ii) financial statements of HMH HPT Courtyard, Inc., a significant
lessee as of January 3, 1997 and January 2, 1998 and for the two fiscal years
ended January 2, 1998 and the period from March 24, 1995 (inception) to December
29, 1995 appearing in the Company's Annual Report on Form 10-K for the year
ended December 31, 1997, and incorporated by reference in this Prospectus
Supplement and the accompanying Prospectus and elsewhere in the related
Registration Statement, have been audited by Arthur Andersen LLP, independent
public accountants, as indicated in their reports with respect thereto. Such
reports are incorporated herein and in the Registration Statement by reference
in reliance upon the authority of said firm as experts in giving said reports.
In addition, the combined financial statements of SC Suites Summerfield
Partnerships as of January 2, 1998 and January 3, 1997 and for the years ended
January 2, 1998, January 3, 1997 and December 29, 1995, appearing in the
Company's Current Report on Form 8-K dated April 15, 1998, and incorporated by
reference in this Prospectus Supplement and the accompanying Prospectus and
elsewhere in the related Registration Statement, have been audited by Ernst &
Young LLP, independent public accountants, as indicated in their report with
respect thereto. Such report is incorporated herein and in the Registration
Statement by reference in reliance on their report given on their authority as
experts in auditing and accounting.
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INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
In addition to the documents incorporated by reference or deemed
incorporated by reference in the accompanying Prospectus, which Prospectus is
supplemented by this Prospectus Supplement, the Company's (i) Annual Report on
Form 10-K for the year ended December 31, 1997 and (ii) Current Reports on Form
8-K dated February 11, 1998, February 12, 1998, February 13, 1998, February 18,
1998, February 20, 1998, February 24, 1998, April 15, 1998, April 16, 1998 and
April 21, 1998, which have been filed with the Commission pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), are hereby
incorporated in this Prospectus Supplement and specifically made a part hereof
by reference. All documents filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus
Supplement and prior to the termination of the offering of the Shares shall be
deemed to be incorporated by reference into this Prospectus and to be a part
hereof from the respective dates of filing of such documents.
Any statement contained herein or in a document incorporated or deemed
to be incorporated herein by reference shall be deemed to be modified or
superseded for purposes of this Prospectus Supplement to the extent that a
statement contained herein, or in any subsequently filed document that also is
or is deemed to be incorporated herein by reference, modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Prospectus
Supplement.
The Company hereby undertakes to provide without charge to each person
to whom this Prospectus Supplement is delivered, upon the written or oral
request of such person, a copy of any and all of the information that has been
incorporated by reference in this Prospectus Supplement (excluding exhibits
unless such exhibits are specifically incorporated by reference into the
information that this Prospectus Supplement incorporates). Requests for such
copies should be made to the Company at its principal executive offices, 400
Centre Street, Newton, Massachusetts 02158, Attention: Investor Relations,
telephone (617) 964-8389.
FORWARD-LOOKING STATEMENTS
THIS PROSPECTUS SUPPLEMENT CONTAINS FORWARD-LOOKING STATEMENTS. SUCH
STATEMENTS ARE SUBJECT TO CERTAIN RISKS AND UNCERTAINTIES WHICH COULD CAUSE
ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE ANTICIPATED OR PROJECTED.
PROSPECTIVE PURCHASERS ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THESE
FORWARD-LOOKING STATEMENTS WHICH SPEAK ONLY AS OF THE DATE HEREOF. THE COMPANY
UNDERTAKES NO OBLIGATION TO PUBLISH REVISED FORWARD-LOOKING STATEMENTS TO
REFLECT EVENTS OR CIRCUMSTANCES AFTER THE DATE HEREOF.
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THE DECLARATION OF TRUST OF THE COMPANY, AMENDED AND RESTATED ON AUGUST
21, 1995, A COPY OF WHICH, TOGETHER WITH ALL AMENDMENTS THERETO (THE
"DECLARATION"), IS DULY FILED IN THE OFFICE OF THE DEPARTMENT OF ASSESSMENTS AND
TAXATION OF THE STATE OF MARYLAND, PROVIDES THAT THE NAME "HOSPITALITY
PROPERTIES TRUST" REFERS TO THE TRUSTEES UNDER THE DECLARATION COLLECTIVELY AS
TRUSTEES, BUT NOT INDIVIDUALLY OR PERSONALLY, AND THAT NO TRUSTEE, OFFICER,
SHAREHOLDER, EMPLOYEE OR AGENT OF THE COMPANY SHALL BE HELD TO ANY PERSONAL
LIABILITY, JOINTLY OR SEVERALLY, FOR ANY OBLIGATION OF, OR CLAIM AGAINST, THE
COMPANY. ALL PERSONS DEALING WITH THE COMPANY, IN ANY WAY, SHALL LOOK ONLY TO
THE ASSETS OF THE COMPANY FOR THE PAYMENT OF ANY SUM OR THE PERFORMANCE OF ANY
OBLIGATION.
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No dealer, salesman or other person has been authorized to give any
information or to make any representation not contained or incorporated by
reference in this Prospectus Supplement and Prospectus. If given or made, such
information or representation must not be relied upon as having been authorized
by the Company or the Underwriter. This Prospectus Supplement and the Prospectus
do not constitute an offer to sell, or solicitation of an offer to buy, Shares
in any jurisdiction to any person to whom it is unlawful to make such offer or
solicitation in such jurisdiction. Neither the delivery of this Prospectus
Supplement or the Prospectus nor any sale made hereunder shall, under any
circumstances, create any implication that there has been no change in the
affairs of the Company since the date hereof.
TABLE OF CONTENTS
Page
Prospectus Supplement
The Company..................................................S-3
Use of Proceeds..............................................S-3
Underwriting.................................................S-3
Legal Matters................................................S-4
Experts......................................................S-4
Incorporation of Certain Information by Reference............S-5
Forward-Looking Statements...................................S-5
Prospectus
Available Information.........................................ii
Incorporation of Certain Documents by
Reference...................................................ii
The Company....................................................1
Use of Proceeds................................................1
Ratio of Earnings to Fixed Charges.............................1
Description of Debt Securities.................................2
Description of Shares.........................................12
Description of Preferred Shares...............................13
Description of Depositary Shares..............................18
Description of Warrants.......................................22
Limitation of Liability; Shareholder Liability................22
Redemption; Trustees; Business Combinations
and Control Share Acquisitions..............................23
Plan of Distribution..........................................28
Legal Matters.................................................29
Experts.......................................................29
1,361,059 Shares
Hospitality Properties Trust
Common Shares of
Beneficial Interest
___________________________
PROSPECTUS SUPPLEMENT
___________________________
A.G. Edwards & Sons, Inc.
April 21, 1998
