Condor Hospitality Trust, Inc. (NASDAQ:CDOR) Files An 8-K Entry into a Material Definitive Agreement

In connection with a rights offering (the “Rights Offering”) of 4,000,000 shares of common stock by Condor Hospitality Trust, Inc. (the “Company”) to its shareholders of record as of a record date to be set for the Rights Offering, the Company and SREP III Flight-Investco 2, L.P. (the “Backstop Investor”) entered into a Backstop Commitment Agreement (the “Agreement”) on December 7, 2020.

The Backstop Investor desires to backstop the Rights Offering on a standby basis to facilitate the transaction. Subject to the terms and conditions set forth in the Agreement and to an exemption from the registration requirements of Section 5 of the Securities Act provided under Section 4(a)(2) thereof and/or Regulation D thereunder, the Company desires to sell, and the Backstop Investor desires to purchase, securities of the Company as more fully described in the Agreement.

On the terms and subject to the conditions contained in the Agreement, the Backstop Investor agrees to purchase, and the Company agrees to sell and issue to the Backstop Investor, an aggregate number of shares of common stock equal to (x) $10.0 million, minus (y) the aggregate proceeds of the Rights Offering divided by $2.50, at a price per share equal to $2.50, subject to the terms and conditions of the Agreement and as further explained in the Agreement. The obligations of the Backstop Investor under the Agreement are subject to certain conditions, which, among other conditions, include: (1) that the Rights Offering must occur on or prior to May 31, 2021, and (2) that the Company exempts the Backstop Investor from the ownership limitation set forth in the Company’s Articles of Incorporation.

The foregoing description of the Agreement does not purport to be complete and is qualified in its entirety by the full text of the Backstop Commitment Agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated by reference in this Item 1.01.

The Backstop Commitment Agreement disclosure set forth under Item 1.01 of this Current Report on Form 8-K is incorporated by reference herein. The common stock potentially issuable to the Backstop Commitment Agreement will, if issued, be issued in reliance on the exemption from registration set forth in Section 4(a)(2) of the Securities Act of 1933, as amended, and/or Regulation D thereunder.