Not for distribution on U.S. wire services or for dissemination in the
HALIFAX, Jan. 16, 2012 /CNW/ - Holloway Lodging Real Estate Investment
Trust (TSX: HLR.UN HLR.DB.A) ("Holloway" or the "REIT") announces the
terms of the issuance of trust units ("Units") of the REIT to the
holders (the "Debentureholders") of its 6.5% convertible unsecured
subordinated debentures (the "Debentures").
Holloway previously announced on December 22, 2011 that it would redeem
the Debentures in full and that it would satisfy the redemption price
of the Debentures by issuing Units in lieu of cash, in accordance with
the terms of the trust indenture for the Debentures (the "Indenture").
The number of Units to be issued to Debentureholders is determined by
dividing the aggregate principal amount of Debentures outstanding by
95% of the weighted average trading price per Unit for the 20
consecutive trading days ending on the fifth trading day preceding the
redemption date (the "Current Market Price"). Based on the redemption
date of January 23, 2012, the 20-trading day period commenced on and
included December 15, 2011 and ended on and included January 16, 2012.
Based on information available from the TSX website, during this period
an aggregate of 10,623,079 Units were traded at an aggregate trading
price of $730,528. As a result, the Current Market Price was determined
to be approximately $0.069 (rounded) and Units will be issued to
Debentureholders at a conversion price of $0.065 (rounded) (being 95%
of the Current Market Price). Based on $46,660,000 principal amount of
Debentures outstanding, approximately 714,224,023 Units will be issued.
However, Holloway will not issue fractional Units on redemption but
instead will satisfy fractional Units by a cash payment equal to the
Current Market Price for any fractional Unit, which may alter the total
number of Units issued.
Units will be issued to registered Debentureholders on January 23, 2012.
The Units will be freely-tradeable in Canada and will not be subject to
any resale restriction under applicable Canadian securities legislation
or the rules of the TSX.
ABOUT HOLLOWAY LODGING REAL ESTATE INVESTMENT TRUST
Holloway is a real estate investment trust 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 19 hotels with 1,881 rooms. Holloway's
units and convertible debentures trade on the Toronto Stock Exchange
under the symbols HLR.UN and HLR.DB.A, respectively.
This press release contains forward-looking information within the
meaning of applicable securities laws. Forward-looking information may
relate to the REIT's future outlook and anticipated events or results
and may include statements regarding the future financial position,
business strategy, financial results and plans and objectives of the
REIT, including, in particular, the redemption of the Debentures and
the issuance and delivery of Units upon such redemption. 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 the REIT 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, 2010
which is available on the REIT's profile on the SEDAR website at www.sedar.com. The REIT does not intend to update or revise any such forward-looking
information should its assumptions and estimates change.
SOURCE HOLLOWAY LODGING REAL ESTATE INVESTMENT TRUST
For further information:
Michael Rapps, Chairman and Interim Chief Financial Officer of the REIT at (416) 855-1925.