MISSISSAUGA, ON, Aug. 18, 2017 /CNW/ - Temple Hotels Inc.
(TSX:TPH) ("Temple" or the "Company") announced today
that it will seek approval from holders of its 7.25% series E
convertible redeemable unsecured subordinated debentures due
September 30, 2017 (TPH.DB.E) (the
"Debentures") to amend the terms of the Debentures at a
meeting of the holders of the Debentures (the
"Debentureholders") to be held on September 21, 2017 (the "Meeting").
The proposed amendments (the "Debenture Amendments") to
the Debentures (as amended by the Debenture Amendments, the
"Amended Debentures") consist of:
- DECREASING the conversion price from $40.08 to $15.00 per share of Temple;
- EXTENDING the maturity date from September 30, 2017 to September 30, 2020; and
- PERMITTING Temple to redeem the Amended Debentures, in whole or
in part, at any time up to September 30,
2020, at a price equal to the principal amount thereof plus
accrued and unpaid interest to, but excluding the date of the
redemption.
Contingent on the approval of the Debenture Amendments, Temple
will, on September 30, 2017, redeem
on a pro rata basis $2,258,200 of the
principal amount of Amended Debentures outstanding as at the close
of business on September 30, 2017
(the "Partial Redemption"). The Partial Redemption will be
for a cash payment equal to the principal amount thereof plus
accrued and unpaid interest to, but excluding the date of the
redemption.
Rai Sahi, Chief Executive
Officer, commented: "Over the last several months, Temple has made
great strides to strengthen its balance sheet position, and as the
economy strengthens in Alberta, we
continue to be excited about the opportunity that lies ahead. By
extending the maturity of the Debentures, Temple would be provided
financial flexibility so that we can continue to focus on key
strategic, business and operational targets that will drive the
success of the Company for all stakeholders. In addition, we
believe that the Debenture Amendments will provide Debentureholders
with a longer period of time during which to receive, what we
believe to be, an attractive yield."
In each instance of a contemplated redemption of the Amended
Debentures, Temple will be required to give not more than 60 days
and not less than 30 days' notice of its intention to redeem,
whether in whole or in part. All remaining Amended Debentures will
be repaid by Temple at the extended maturity date of September 30, 2020.
If the Debenture Amendments are approved by the
Debentureholders, the Debenture Amendments will be effective on the
date that Temple enters into the second further supplemental trust
indenture embodying such amendments.
Board Recommendation
The Board of Directors of Temple (the "Board") believes
that the Debenture Amendments provide a number of benefits to
Temple and its securityholders, including to the
Debentureholders.
The Board UNANIMOUSLY RECOMMENDS that the
Debentureholders vote FOR the Debenture Amendments.
Details About the Debenture Amendments
The record date for determining the Debentureholders entitled to
receive notice of and vote at the Meeting is August 18, 2017. Further information with respect
to the Debenture Amendments will be outlined in the management
information circular of Temple (the "Circular") to be sent
to Debentureholders in connection with the Meeting. For the
Debenture Amendments to be approved, at least 66⅔% of the principal
amount of the Debentures voted (either in person at the Meeting or
by proxy) must be voted in favour of the Debenture Amendments.
Detailed voting instructions will be found in the Circular and
accompanying proxy form or voting instruction form. The Meeting is
scheduled to be held on September 21,
2017 at 10:00 a.m. (Eastern
Time) at the offices of Morguard Corporation, 1000 – 55 City
Centre Drive, Mississauga, Ontario
L5B 1M3.
The Debenture Amendments are subject to the approval of the
Toronto Stock Exchange (the "TSX").
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). For further information on Temple, please visit our
website at www.templehotels.ca.
Cautionary Statement Regarding Forward-Looking
Statements
Certain statements included herein constitute "forward-looking
statements". All statements included in this press release that
address future events, conditions or results of operations,
including in respect of the Debenture Amendments, are
forward-looking statements. These forward-looking statements can be
identified by the use of forward-looking words such as "may",
"should", "will", "could", "expect", "intend", "plan", "estimate",
"anticipate", "believe", "future" or "continue" or the negative
forms thereof or similar variations. Forward looking statements in
this press release include, but are not limited to, the expected
impact of the Partial Redemption; the expected terms of the
Debenture Amendments; the expected effective date of the Debenture
Amendments; and the expected benefits of the Debenture Amendments
to Temple and to the Debentureholders. These forward-looking
statements are based on certain assumptions and analyses made by
management in light of their experiences and their perception of
historical trends, current conditions and expected future
developments, as well as other factors they believe are appropriate
in the circumstances. Debentureholders are cautioned not to put
undue reliance on such forward-looking statements, which are not a
guarantee of performance and are subject to a number of risks and
uncertainties, including, but not limited to that the Debenture
Amendments will not be successfully completed for any reason and
the risk that, if completed, Temple will not be able to pay the
interest and/or repay the principal amount outstanding under the
Debentures when due, and that Temple or Debentureholders may not
realize the anticipated benefits of the Debenture Amendments, and
increases in interest rates. Many of such risks and uncertainties
are outside the control of Temple and could cause actual results to
differ materially from those expressed or implied by such
forward-looking statements. In making such forward-looking
statements, management has relied upon a number of material factors
and assumptions, including with respect to general economic and
financial conditions, interest rates, exchange rates, equity and
debt markets, business competition, changes in government
regulations or in tax laws, acts and omissions of third parties,
and the ability of Temple to obtain approval for the Debenture
Amendments (including approval from the TSX). Such forward-looking
statements should, therefore, be construed in light of such factors
and assumptions. All forward-looking statements are expressly
qualified in their entirety by the cautionary statements set forth
above. Temple is under no obligation, and expressly disclaims any
intention or obligation, to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as expressly required by applicable law.
SOURCE Temple Hotels Inc.