[LODGIAN LETTERHEAD]

                                  NEWS RELEASE

FOR IMMEDIATE RELEASE                       CONTACT: Warren M. Knight
                                                     Chief Financial Officer
December 11, 1998                                    (404) 365-4474


                     SERVICO AND IMPAC HOTEL GROUP COMPLETE
                        MERGER TRANSACTIO TO FORM LODGIAN

     ATLANTA,  GEORGIA:  Lodgian,  Inc.  (NYSE:  LOD),  a  nationwide  owner and
operator of hotels, today announced closing of the merger of Servico,  Inc., and
Impac  Hotel  Group to form  Lodgian,  Inc.  The  merger,  which was  originally
announced in March,  1998,  closed today and creates one of the nation's largest
multi-brand owner/operators of hotels.

     Trading in Servico, Inc. common stock with the symbol SER will cease on the
New York Stock  Exchange  at the close of business  today,  December  11,  1998.
Trading in Lodgian,  Inc.  common stock with the symbol LOD will commence on the
New York Stock Exchange Monday, December 14, 1998.

     The transaction,  which was previously approved by Servico shareholders and
Impac unit holders,  creates a lodging  company with a substantial  portfolio of
full  service  hotel   properties   in  the  mid  and  upper  market   segments,
geographically dispersed throughout the United States, Canada and Europe.

     As part of the closing,  the previously  announced  $265 million  financing
commitment  from Lehman  Brothers has been fully funded.  This  financing  bears
interest at LIBOR plus 3.25% and has a two year maturity  which  represents  the
nearest term maturity of any significant Lodgian debt obligation.



     Concurrent with the completion of the merger,  Robert S. Cole, formerly the
President of Impac,  becomes the Chief Executive  Officer of Lodgian.  Lodgian's
Board of Directors  will consist of Joseph C. Calabro,  Michael A. Leven,  Peter
Tyson and  Richard  Weiner,  all  former  members of the Board of  Directors  of
Servico and Robert S. Cole and John Lang, both formerly with Impac.  Lodgian has
also  established  an Office of the  Chairman  composed of  directors  Joseph C.
Calabro,  John Lang and Michael A.  Leven,  with  Joseph C.  Calabro  serving as
acting chairman of the Office of the Chairman.

     Commenting  on the merger,  Joseph C.  Calabro  stated,  "We are  extremely
pleased to successfully  complete this merger.  This transaction marks Servico's
entrance  into  additional   major  urban  markets  and  creates  new  franchise
relationships  with Marriott and  Doubletree.  We look forward to completing the
integration  of  Servico  and Impac  and to focus on  executing  Lodgian's  1999
Business Plan."

     Robert S. Cole, Lodgian's Chief Executive Officer,  stated, "We are looking
forward to creating  the premier  owner and  operator of hotels and a recognized
leader  in  the  hospitality   industry.   I  am  very  enthusiastic  about  the
complementary  skills  of  the  two  organizations.   Servico  has  demonstrated
remarkable  operating results unparalleled in the hotel industry while Impac has
utilized its repositioning, development and management expertise to consistently
improve hotel values."

     Lodgian  owns or  manages  143  hotels  with more than  27,000  rooms in 35
states, Canada and Europe. The hotels are primarily full service, providing food
and beverage service as well as lodging and meeting  facilities.  Substantially,
all of Lodgian's  hotels are affiliated with nationally  recognized  hospitality
franchises,  including Crowne Plaza, 




Doubletree,  Holiday Inn, Hilton, Marriott, Omni, Radisson, Sheraton and Westin.
With  assets  in excess  of $1  billion,  Lodgian  is one of the  largest  hotel
owner/operators in the United States.

     Statements  in this release may be construed to be forward  looking and are
made pursuant to the Safe Harbor provisions of the Private Securities Litigation
Reform Act of 1995.  Investors are cautioned that all forward looking statements
involve risks and uncertainties, including without limitation, risks relating to
the operation and acquisition of hotels,  risks relating to the  availability of
capital and the ability to  refinance  debt,  risks  relating to the  historical
cyclicality of the lodging  industry and other risks identified in Lodgian's and
Servico's SEC filings.