All in West! Capital Corporation Announces Notice of Default on Repayment of Principal of Series B and Series C Debentures
WINNIPEG, Sept. 5, 2012 /CNW/ - All in West! Capital Corporation (the "Corporation") (TSXV: ALW) announced today that it has delivered formal written notice to CIBC Mellon Trust Company, the indenture trustee for its Series B convertible debentures (the "Series B Debentures") which mature on September 28, 2012, and for its Series C convertible debentures (the "Series C Debentures") which mature on October 1, 2012, that the Corporation will default on its obligation to repay the principal amount and accrued interest on the Series B and Series C Debentures on their respective maturity dates. The Corporation has been in default of its obligations relating to the Series B Debentures since April 30, 2010, when it ceased making monthly interest payments. It has been in default of its obligations relating to the Series C Debentures since November 30, 2010, when it ceased making monthly interest payments.
In addition to the current and anticipated default of the Corporation
relating to its Series B and Series C Debentures, the Corporation is
also in default of a number of its obligations under various financing
documents. Such defaults include the following:
|(i)||the Corporation is in default of its obligation to repay principal plus interest relating to the Series A convertible debentures (the "Series A Debentures") which matured on March 31, 2012. The Corporation ceased monthly interest payments on April 30, 2010;|
|(ii)||the Corporation is in default of its obligation to make principal and interest payments to the mortgagee under its mortgage financing and security documents relating to the Econolodge Inn and Suites in Hinton, Alberta. The outstanding mortgage balance is currently $6,404,820;|
|(iii)||as a result of the defaults noted above, the Corporation is in breach of the "cross-default" covenants under its mortgage financing and security documents relating to the Phase I and Phase II Best Western hotels in Grande Cache, Alberta. The outstanding mortgage balances for such properties are currently $7,775,582 in respect of the Phase I property and $4,637,066 in respect of the Phase II property.|
The Corporation is in ongoing discussions with its mortgage lenders regarding the defaults under its mortgage indebtedness and potential restructuring of such indebtedness.
Earlier this year, the Corporation sold the Days Inn in Hinton, Alberta to the mortgage lender in consideration for the settlement of the outstanding mortgage indebtedness. The property was independently appraised for $3,000,000 and $4,224,888 of debt owed by the Corporation to the mortgage lender was forgiven.
The Corporation is continuing to evaluate alternatives available to it. The Corporation formed a special committee whose mandate is to evaluate the Corporation's alternatives specifically as it relates to its outstanding convertible debentures and to make recommendations to the Board of Directors. The Corporation has engaged a third party investment banking advisor to work with the special committee and Board of Directors.
Caution Concerning Forward-Looking Statements
This news release of All in West! Capital Corporation (the "Corporation") contains certain statements that constitute forward-looking information within the meaning of applicable securities laws ("forward-looking statements"). All statements other than statements of historical fact contained herein are forward-looking statements, including, without limitation, statements regarding the alternatives relating to its convertible debentures. Certain risks and uncertainties regarding the Corporation are more fully discussed in the Corporation's filings with Canadian provincial securities regulatory authorities, including its most recent management discussion and analysis, a copy of which is available on www.sedar.com. The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement. The Corporation does not undertake any obligation to update forward-looking statements.
Neither the TSX Venture Exchange nor its service provider has reviewed or approved the contents of this press release.
SOURCE: All in West! Capital CorporationFor further information:
Please contact Mr. Cornelius Martens, President and Chief Executive Officer, or Cornelius William Martens, Investor Relations, Tel: (204) 947-1200.