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

Item1.01

Hotel Acquisition

On April14, 2017, Condor Hospitality Limited Partnership (CHLP),
the operating partnership of the Company, completed the
acquisition of a hotel to a purchase agreement dated January23,
2017 with CVH Southaven, LLC. The hotel is the Home2 Suites
Memphis/Southaven, with 105 rooms, located in Southaven, MS.

The aggregate purchase price for the Southaven hotel was
$19.0million which was paid with a combination of cash, debt
financing (as discussed below) and CHLP limited partnership units
(as discussed below). The closing of the acquisition of the hotel
was subject to the assumption of $9.1million of debt and
customary closing conditions including accuracy of
representations and warranties and compliance with covenants and
obligations under the purchase agreement.

The hotel acquisition was completed by CDOR MEM Southcrest, LLC
(CMS), a single-purpose bankruptcy remote entity 50% owned by
CHLP. In connection with the closing of the acquisition, the
hotel was leased to TRS MEM Southcrest, LLC (TMS), a
single-purpose bankruptcy remote entity 50% owned TRS Leasing,
Inc., the taxable REIT subsidiary of the Company.

The description of the purchase agreement for the hotel is
qualified in its entirety by the form of such agreement filed
with this report as Exhibit 10.1 and is incorporated herein by
reference.

Management Agreement

Hotel Management.On April14, 2017, TMS entered into a
hotel management agreement with Vista Host Inc. (Vista), an
eligible independent operator, to manage the Southaven hotel.
Vista managed the hotel prior to the acquisition and is an
affiliate of the seller of the hotel.

Under the hotel management agreement, Vista operates and manages
the hotel. Vista provides all property management, financial
accounting, reporting, marketing and other operational services
for the hotel, and employees for operating the hotel.Vista must
generally maintain the hotel in good operating condition. Vista
must operate the hotel in accordance with the national franchise
agreement that covers the hotel, which includes using franchisor
sales and reservation systems.

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The management agreement generally requires TMS to fund budgeted
capital expenditures and operating expenses, except those
expenses not related to the operation of the hotel.TMS is
responsible for obtaining and maintaining insurance policies with
respect to the hotel.

Management Fee.Vista will receive a monthly management fee
with respect to the hotel equal to 3% of the gross hotel
income.Incentive fees may be earned by Vista for performance
above budgeted expectations for the hotel up to a maximum payout
of 2% of gross hotel income in 2017 and 2018 as follows:

For 2019 and until termination of the management agreement,
incentive fees with respect to the hotel may be earned by Vista
as follows, up to a maximum payout of 2% of gross hotel income:

NOI is equal to gross hotel income less operating expenses
(exclusive of management fees, certain insurance premiums and
employee bonuses, and personal and real property taxes).

Term and Termination.The management agreement expires on
April14, 2020 and will renew for two additional terms of one year
unless either party to the agreement gives the other party
written notice of termination at least 90 days before the end of
a term.

TMS may terminate the management agreement, subject to cure
rights, due to certain inspection failures or if performance
metrics tied to the hotel are not met. TMS may also terminate the
management agreement without reason on 60 days notice.Upon any
such termination without reason by TMS, TMS must pay Vista a
termination fee equal to the lesser of: (a) 50% of the monthly
management fee paid during the trailing 12 months (including any
such fees paid prior to the commencement of the management
agreement); or (b) 50% of the average monthly management fee paid
during the trailing 12 months multiplied by the number of months
remaining in the initial term or renewal term. The management
agreement terminates upon a sale of the hotel, subject to certain
notice requirements.

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The description of the management agreement for the hotel is
qualified in its entirety by the form of such agreement filed
with this report as Exhibit 10.2 and is incorporated herein by
reference.

Debt Financing

The purchase price of the Southaven hotel was financed, in part,
through the assumption of a mortgage loan payable to U.S. Bank
National Association, as Trustee for Morgan Stanley Bank of
America Merrill Lynch Trust 2014-C18, Commercial Mortgage
Pass-Through Certificates, Series 2014-C18 (the Lender).On
April14, 2017, CMS and TMS assumed the mortgage loan in the
principal amount of $9.1million, to an assumption agreement dated
as of April14, 2017, among Lender, CMS, TMS, the Company and the
original borrower and guarantor thereto.

The loan bears interest at a fixed rate of 4.54%, requires
monthly principal and interest payments of $48,361 and matures on
August1, 2024. The loan is non-recourse to the Company, except
for certain customary carve-outs which are guaranteed by the
Company. The loan is secured by a first priority lien and
security interest on the hotel and the tangible and intangible
personal property owned by the borrowers in connection with the
operations on the hotel property, including inventory, equipment,
fixtures, accounts and general intangibles.

The information provided in Item 1.01 is incorporated herein by
reference.

Item 1.01 is incorporated herein by reference.

to the purchase agreement for the Southaven hotel, as partial
consideration for the purchase price of the hotel, CHLP issued to
the seller limited partnership units with an aggregate value of
$51,526.On April14, 2017, 206,104 limited partnership units were
issued to CVH Southaven, LLC.

The CHLP limited partnership units were issued to the seller of
the hotel in a transaction exempt from registration under the
Securities Act of 1933, as amended, in reliance on Section
4(a)(2) thereof, as such issuance of securities was not made in a
public offering.

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to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.

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