MISSISSAUGA, ON, July 5, 2017 /CNW/ - Temple Hotels Inc. (TSX:TPH) ("Temple") announced today that its Series D 7.75% convertible debentures were repaid in full with accrued interest at their June 30, 2017 maturity date. The principal balance outstanding of the Series D convertible debentures at maturity was $34.3 million.
Temple is also announcing a binding agreement for the refinancing of a five-loan mortgage portfolio with the incumbent lender, a Canadian chartered bank. The five loans are cross collateralized and it is expected the loans will close in the third quarter of 2017. Three of the five loans were refinanced for a five-year term at an interest rate of 5.20% and are not subject to any financial covenants during the first 12 months of the term. As a condition of refinancing, Temple will pay down the maturing, aggregate balance by $7.5 million. The fourth mortgage loan of five in the portfolio does not mature until November 2019 and the fifth loan has been extended for 12 months as these properties are currently listed for sale.
Temple has also entered into a revolving credit facility with a Canadian chartered bank for a maximum loan of $16.5 million at a floating rate of interest equivalent to the 30-day Bankers' Acceptance rate plus 350 basis points. The credit facility, which has a term of two years, is secured by two hotel properties located in Yellowknife, Northwest Territories. The two Yellowknife properties were unfinanced prior to entering into the credit facility.
Temple also announces the refinancing of a hotel property located in Sudbury, Ontario, in the amount of $8.4 million, at an interest rate of 4.69% for a term of seven years. The refinanced amount is equivalent to the maturing principal balance.
As a result of the refinancings described above, Temple has resolved five of the ten covenant violations reported at March 31, 2017. Temple continues to work diligently with its lenders to resolve its remaining mortgage covenant violations, which have primarily been caused by the downturn in oil-dependent markets.
Rai Sahi, Chief Executive Officer, commented, "We appreciate the ongoing support of our lenders for their commitment to the long-term success of Temple. The terms of these new financings provide financial flexibility so that Temple can continue to focus on key strategic, business and operational targets that will drive the success of the Company for all stakeholders".
About Temple Hotels Inc.
Temple is a growth oriented hotel investment company with hotel properties located across Canada. Temple is listed on the Toronto Stock Exchange under the symbols TPH (common shares), TPH.DB.E and TPH.DB.F (convertible debentures). The primary long‑term investment objectives of the Company are to yield stable and growing cash flows and to maximize the long‑term share value of the Company through the active management of its assets, accretive acquisitions, and the performance of value‑added capital improvement programs on selected properties, as deemed appropriate. For further information on Temple, please visit our website at www.templehotels.ca.
SOURCE Temple Hotels Inc.
For further information: Paul Miatello, Chief Financial Officer, T 905-281-3800; Beverley G. Flynn, Vice President, T 905-281-3800