MIAMI, Aug. 13, 2024 (GLOBE NEWSWIRE) -- LuxUrban Hotels Inc. ("LuxUrban" or the "Company") (NASDAQ:LUXH), which secures long-term operating rights for entire hotels through Master Lease Agreements (MLA) under which it manages the hotel and rents out, on a short-term basis, rooms to business and vacation travelers, today announced that it has closed the first tranche of a private offering (the "Notes Offering") to sell up to $10 million aggregate principal amount of new senior secured convertible notes due 2027 (the "Notes") and common stock purchase warrants ("Note Warrants") in one or more closings through August 30, 2024. The first tranche closing occurred on August 13, 2024 and generated gross cash proceeds of $2.1 million. The Company intends to use the net cash proceeds from the Notes Offering for working capital and other general corporate purposes. Among these corporate purposes is the continued advancement of Lux 2.0, the Company's previously announced series of initiatives focused on identifying and curing various financial and operational issues, and to create a platform that can deliver long-term shareholder value. The Notes bear interest at 18%, are secured by substantially all of the assets of the Company, and are being sold to certain accredited investors in a private offering exempt from registration under the Securities Act of 1933, as amended (the "Securities Act"). ADDITIONAL INFORMATION REGARDING THE OFFERING Under the terms of the Notes Offering, certain equity investors and holders of promissory notes evidencing existing borrowed money obligations of the Company were entitled to convert such equity and debt into the offering. As a result of these conversions, the Company will issue an additional aggregate of $2.8 million principal amount of Notes and corresponding Note Warrants to purchase shares of common stock as part of the initial closing. Repayment of the principal amount of the Notes commences twelve (12) months from the date of issuance. The principal shall be repaid in twenty-four (24) equal monthly installments commencing on August 13, 2025 and continuing on the same day of each month thereafter until the principal amount is paid in full ("Principal Payments"), with all principal and interest due ...