/NOT FOR DISSEMINATION IN THE UNITED STATES OR FOR DISTRIBUTION TO U.S
NEWS WIRE SERVICES/
WINNIPEG, Aug. 14, 2012 /CNW/ - Lakeview Hotel Real Estate Investment
Trust (TSXV:LHR.UN) ("Lakeview REIT" or the "Trust") announced today its intention to amend the terms of its outstanding
8.5% Series D Convertible Redeemable Subordinated Debentures (the "Debentures"). Lakeview REIT has prepared and will send to holders of the
Debentures (the "Debentureholders") an information circular (the "Circular") and a proxy and consent form relating to a meeting of the
Debentureholders to be held on September 21, 2012 (the "Meeting") at which the Debentureholders will vote on whether to accept the
amendments to the Debentures.
Lakeview REIT wishes to amend the Debentures as it does not currently
have the cash resources available to repay the Debentures when they
mature. The Trust's operations have seen recent improvement, however,
cash resources have been utilized to service current debt.
At the Meeting, the Debentureholders will be asked to approve the
following amendments (the "Amendments") to the Debentures:
Extending the maturity date of the Debentures from May 31, 2013 to May 31, 2018;
Changing the payment of interest from being calculated and payable semi-annually
at the rate of 8.5% per annum to being calculated and payable
semi-annually in arrears at the rate of 9.0% per annum on June 30 and
December 31 in each year, commencing June 30, 2013. For greater
certainty, from July 1, 2012 to December 31, 2012 the applicable
interest rate will be 8.5% per annum and from January 1, 2013 to
maturity, the interest rate will be 9.0% per annum payable
semi-annually in arrears
Eliminating the ability of Debentureholders to convert the Debentures
into trust units of the Trust ("Units");
Eliminating the "Change of Control" provision set out in Section 9.1.01 of the Trust
Indenture which provided that upon the occurrence of a change of
control involving the acquisition of voting control or direction over
66⅔% or more of the Units by any person or group of persons acting
jointly or in concert, Debentureholders will have the right to require
the Trust to repurchase their Debentures, in whole or in part, at a
price equal to 101% of the principal amount of the Debentures, plus
accrued and unpaid interest thereon;
Amending the redemption feature of the Debentures so that on and after May 31,
2013 but prior to the maturity of the Debentures, the Debentures will
be redeemable by the Trust, in whole or in part, at a price equal to
the principal amount thereof, plus accrued and unpaid interest from
time to time at the Trust's sole option on not more than 60 days' and
not less than 30 days' prior written notice;
Improving the security granted by the Trust for the repayment of the Debentures by
providing that the Debentures shall rank senior in all respects to all
future series of debentures issued by the Trust and are subordinate
only to senior security (as such term will be defined in the
supplemental replacement trust indenture attached to the Circular) and
are pari passu with the 5 Year Series C Redeemable Subordinated
Debentures of the Trust; and
Increasing the aggregate principal amount of Debentures authorized to be
issued under the Trust Indenture by $180,000 to $10,180,000.
In order to effect the Amendments, Lakeview REIT will be required to
enter into a supplemental trust indenture with the trustee for the
Debentures, CIBC Mellon Trust Company. The Amendments will be
effective on or about September 30, 2012. Further information
regarding the Amendments will be available in the Circular, which will
be filed on SEDAR.
Lakeview REIT has retained Osprey Capital Partners Inc. ("Osprey") to
act as soliciting dealer. Osprey will form a soliciting dealer group
to solicit votes regarding the Amendments.
In the event Lakeview REIT receives the written consent of
Debentureholders holding at least 66⅔% of the principal amount of the
Debentures prior to the Meeting, the Amendments will be approved and
Lakeview REIT will cancel the Meeting.
There are approximately $9,980,000 principal amount of Debentures issued
and outstanding. The Debentures are listed on the TSX Venture Exchange
under the trading symbol "LHR.DB.D".
Lakeview REIT is a real estate investment trust, which is listed on the
TSX Venture Exchange under the symbol "LHR.UN". Lakeview REIT receives
income from ownership, management and licensing of hotel properties.
For further information on Lakeview REIT please visit our website www.lakeviewreit.com.
Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this release.
SOURCE: Lakeview Hotel Real Estate Investment Trust
For further information:
Keith Levit, President, or Avrum Senensky, Executive Vice President
Tel: (204) 947-1161, Fax: (204) 957-1697, Email firstname.lastname@example.org