/NOT FOR DISTRIBUTION ON U.S. WIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/
HALIFAX, March 8, 2016 /CNW/ - Holloway Lodging Corporation (TSX: HLC, HLC.DB, HLC.DB.A) ("Holloway") is pleased to announce that it has entered into various financing transactions in recent weeks.
First, Holloway has renegotiated an improved revolving credit facility with its principal lender. The amended credit facility provides Holloway with total availability of $45.0 million (previously $25.0 million) and is secured by ten hotel properties (previously seven hotel properties). The interest rate under the credit facility is based on a spread over the prime rate or banker's acceptances, at Holloway's discretion, and is presently 3.95%. The full amount of the credit facility will be available as security over the additional properties is registered.
Second, Holloway has entered into mortgages for three previously unencumbered hotels located in Nova Scotia and New Brunswick. The mortgages have an aggregate principal amount of $8.9 million, a five-year term and a fixed rate of interest of 4.25%.
Third, Holloway has refinanced the mortgage on an Ontario hotel with a new lender. The mortgage has a principal amount of $3.5 million (previously $2.4 million), a five-year term and a fixed rate of interest of 4.25% (previously 6.50%). There was no penalty on the prepayment of the previous mortgage.
These financing transactions reduce Holloway's cost of capital and provide Holloway with additional funds and financial capacity to execute on its business plan, including acquiring new hotels and investing in existing properties. Further, these transactions illustrate our lenders' confidence in our assets and business strategy.
ABOUT HOLLOWAY LODGING CORPORATION
Holloway is a real estate corporation focused on acquiring, owning and operating select and limited service lodging properties and a small complement of full service hotels primarily in secondary, tertiary and suburban markets. Holloway owns 35 hotels with 3,973 rooms. Holloway's shares and debentures trade on the TSX under the symbols HLC, HLC.DB and HLC.DB.A.
This press release contains forward-looking information within the meaning of applicable securities laws. Forward-looking information may relate to Holloway's future outlook and anticipated events or results and may include statements regarding Holloway's future financial position, business strategy, financial results, plans and objectives. In some cases, forward-looking information can be identified by terms such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "potential", "continue" or other similar expressions concerning matters that are not historical facts. Forward-looking information is subject to certain factors, including risks and uncertainties, that could cause actual results to differ materially from what Holloway currently expects and there can be no assurance that such statements will prove to be accurate. Some of these risks and uncertainties are described under "Risk Factors" in Holloway's annual information form for the year ended December 31, 2014 which is available on Holloway's profile on the SEDAR website at www.sedar.com. Holloway does not intend to update or revise any such forward-looking information should its assumptions and estimates change.
SOURCE Holloway Lodging Corporation
For further information: For further information please contact Michael Rapps, Chairman, at (416) 855-1925 or Jane Rafuse, Chief Financial Officer, at (902) 443-5101