Lodgian seeking reverse split to boost shares - Atlanta Business Chronicle:

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The plan, if shareholders approve it, could boosyt Lodgian’s stock price, which the company and securities expertw say might make it more attractive to institutional investorxs like mutual andhedge funds. Shares of Lodgiamn (Amex: LGN), which owns 41 hotels nationwide, closes March 24 at $2.73, and have been as low as $1.10 last December. The stock price has swunbg wildlysince November, and retreated 10 percentf March 16 after the company’s independenf auditor raised concerns about Lodgian’s abilitt to continue. The stock has sincs enjoyed a slight uptick.
Hotel companies, many facingh eroding demand and heavy debt have seen their share pricezs drop sharply as the financial crisishas deepened. Deloitte, the independent auditor of thehotel company, said in Lodgian’s annuao Securities and Exchange Commissionm filing that it had “substantiaol doubt” as to Lodgian’s ability to continues operating as “a going concern.” “We believe that the increasedc market price of our common stock ... may encourage interest and trading in our common stock and may be beneficiao to us in connection with our refinancing Lodgian told shareholdersMarch 20. Lodgiann officials declined to commengt forthis article.
Lodgian is saddled with $128 million in hotel mortgages that will maturre in July and the company has said it has been unablde to reach agreement with loan serviceres on an extension or refinancing ofthe loans. The companyu said in a recent news releasdethat “in light of the current state of credity markets generally and the real estate credirt markets specifically, the company cannot currently predicty the outcome of these efforts.” The company’ds board of directors could approve ratiosa that would reduce the numbetr of outstanding shares from 50 percent to 90 percent. Jack a professor, said Lodgian faces “a real tough uphilk struggle.
” Reverse splits have mixed records of success in boostingv stock priceslong term, he Brink Dickerson, a securities attorney for LLP, said lenders are loathy to take properties back in the given economy, but he said it is unclear if a reverse split will help Lodgianm refinance its debt. Don Shula is going for two. The retirec football legend, whose Shula’zs 347 Grill chain of steakhouses will make its Atlant debut in Buckhead later this will develop a second restaurant inside an planned for Duluth.
GS Development LLC, the developerf of an Embassy Suites hotel planned for the Arena atGwinnettr Center, will have metro Atlanta’a second Shula’s 347 Grill as its signature GS Development officials are close to financing the $57 milliob hotel project first announced in 2007. The firs t restaurant is planned insidw the onLenox Road. The Buckhear Hotel, a former , is under heavy renovationsw to be rebrandedthe . Ron Eyester, the longtim chef and partner in Food 101 is now thepopular eatery’s sole proprietor. Eyester boughg the restaurant from 101 Concepts LLCMarch 3.
Termz of the deal were not Food 101 will be renamed in the comingg months and the dining room will be Eyester plans to retainthe restaurant’s staff.