EXHIBIT 99.1
[AH LOGO]
ARLINGTON HOSPITALITY, INC.
2355 South Arlington Heights Road - Suite 400 - Arlington Heights, IL 60005
847-228-5400 Fax: 847-228-5409 www.arlingtonhospitality.com
For Immediate Release
CONTACT: MEDIA CONTACT:
James B. Dale, Chief Financial Officer Jerry Daly or Carol McCune
847-228-5401 x 361 703-435-6293
jimdale@arlingtonhospitality.com jerry@dalygray.com
ARLINGTON HOSPITALITY, INC. ANNOUNCES MODIFICATION OF TEMPORARY LETTER AGREEMENT
ARLINGTON HEIGHTS, Ill., September 10, 2004--Arlington Hospitality,
Inc. (Nasdaq/NM: HOST), a hotel development and management company, today
announced the modification of the temporary letter agreement with PMC Commercial
Trust ("PMC") (AMEX: PCC), the landlord of 20 AmeriHost Inn hotels operated by
Arlington. One hotel owned by PMC and leased by Arlington was sold to a third
party in August 2004. Arlington continues its on-going discussions to
restructure its leases with PMC and to allow for the sale of the remaining 20
leased hotels to third parties.
As a result of the modification, the monthly base rent for the 20 hotel
leases has reverted to the terms in effect prior to the original temporary
letter agreement. The temporary letter agreement had provided for the deferral
of a portion of the base rent for the months of March through July, which
reduced the monthly payments from approximately $445,000 to approximately
$360,000, and allowed the company to utilize $200,000 of its lease security
deposit to partially fund the base rent payments. The temporary letter agreement
had provided that the accumulated deferred portion of the base rent
(approximately $434,000) plus $200,000
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needed to restore the security deposit to its March 12, 2004 balance, be repaid
to PMC in four equal monthly installments beginning September 1, 2004.
Under the terms of the current modification, the four-month repayment
schedule was eliminated, and the approximate $434,000 in accumulated deferred
rent was funded from the existing lease security deposit. In addition, the
current modification provides that the remaining balance of the lease security
deposit totaling approximately $173,000 be utilized to reduce the outstanding
balance of a note payable to PMC executed in connection with the sale of a
leased property in August 2004. PMC reserved the right to require Arlington to
replenish the lease security deposit as of August 31, 2005, to its original
balance for each hotel leased at that time.
Arlington paid the full base rent of approximately $445,000 for August
and $423,000 for September 2004, reflecting the sale of one hotel in August.
While the objective of the company's on-going discussions with PMC is to reach a
global agreement, there can be no assurances that the leases will be
restructured on terms and conditions acceptable to the company and its
subsidiary.
ABOUT ARLINGTON HOSPITALITY
Arlington Hospitality, Inc. is a hotel development and management
company that builds, operates and sells mid-market hotels. Arlington is the
nation's largest owner and franchisee of AmeriHost Inn hotels, a 105-property,
mid-market, limited-service hotel brand owned and presently franchised in 20
states and Canada by Cendant Corporation (NYSE: CD). Currently, Arlington
Hospitality, Inc. owns or manages 54 properties in 15 states, including 49
AmeriHost
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Inn hotels, for a total of 3,960 rooms, with additional AmeriHost Inn & Suites
hotels under development.
This press release may contain forward-looking statements.
Forward-looking statements are statements that are not historical, including
statements regarding management's intentions, beliefs, expectations,
representations, plans or predictions of the future, and are typically
identified by words such as "believe," "expect," "anticipate," "intend,"
"estimate," "may," "will," "should," and "could." There are numerous risks and
uncertainties that could cause actual results to differ materially from those
set forth in the forward-looking statements. For a discussion of these factors,
see the Company's report on Form 10-K for the year ended December 31, 2003,
report on Form 10-Q for the three months ended March 31, 2004, and report on
Form 10-Q for the three and six months ended June 30, 2004 under the section
headed "Management's Discussion and Analysis of Financial Condition and Results
of Operations - Risk Factors" as they may be updated in the company's subsequent
SEC filings.
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