MISSISSAUGA, ON, Sept. 19, 2017 /CNW/ – Temple Hotels Inc. (TSX:TPH) (“Temple“) announced today that the meeting (the “Meeting“) of the holders (the “Debentureholders”) of its 7.25% series E convertible unsecured subordinated debentures due September 30, 2017 (TPH.DB.E) (the “Debentures“) to consider certain amendments to the terms of the Debentures will be called as scheduled on September 21, 2017 but will immediately be adjourned to September 28, 2017 at 10:00 a.m. (Eastern Time). The deadline for submitting proxies will be September 27, 2017 at 10:00 a.m. (Eastern Time). The Meeting is being adjourned to allow Debentureholders sufficient time to consider the revisions to Temple’s proposed amendments to the Debentures.
In conjunction with the rescheduled Meeting, and based on feedback from Debentureholders, Temple has announced revised terms to the proposed amendments to the Debentures. Temple now proposes the following amendments (the “Amendments“) to the Debentures (as amended by the Amendments, the “Amended Debentures“) to be considered at the adjourned Meeting:
DECREASING the conversion price from $40.08 to $9.75 per share of Temple. Previously, Temple had proposed decreasing the conversion price to $15.00 per share of Temple, rather than $9.75 per share;
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 Amendments, Temple will redeem $2,258,200 principal amount of Debentures on each of September 30, 2017, September 30, 2018 and September 30, 2019 (the “Partial Redemptions“). Accordingly, the total principal amount of Amended Debentures to be redeemed over the course of the three Partial Redemptions by Temple is $6,774,600, which represents approximately 15% of the currently issued and outstanding Debentures. Previously, Temple had only committed to redeem $2,258,200 principal amount of Debentures (approximately 5% of the issued and outstanding Debentures) upon approval of the Amendments. Each 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 weeks we have had discussions with Debentureholders and respective investment brokers, and based on this feedback we have received strong support to move forward on these revised amendments. We continue to believe that the amendments provide Temple with 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 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 Amendments are approved by the Debentureholders, the Amendments will be effective on the date that Temple enters into the second further supplemental trust indenture embodying such amendments
The Board of Directors of Temple (the “Board“) believes that the 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 Amendments.
Details About the Amendments
The Meeting will be adjourned to allow additional time for all of the Debentureholders to participate in the vote on the proposed Amendments and deposit the Form of Proxy and Consent or Voting Instruction Forms (“Proxy“) or make changes to any previously deposited Proxy, in advance of the reconvened Meeting.
The record date for determining the Debentureholders entitled to receive notice of and vote at the Meeting remains August 18, 2017. Further information with respect to the Amendments will have been outlined in the management information circular of Temple (the “Circular“) dated August 21, 2017. For the Amendments to be approved, at least 66â % of the principal amount of the Debentures voted (either in person at the Meeting or by proxy) must be FOR votes.
Detailed voting instructions are found in the Circular and accompanying Proxy. The adjourned Meeting will be held on September 28, 2017 at 10:00 a.m. (Eastern Time) at the offices of Morguard Corporation, 1000 â 55 City Centre Drive, Mississauga, Ontario L5B 1M3.
As a Debentureholder, if you have not voted or have voted against the originally proposed amendments, your immediate attention is required. Debentureholders who previously voted for the originally proposed amendments do not need to take any action to have their vote counted in favour of the revised Amendments. Debentureholders who have not voted or wish to change their vote may do so by following the instructions set forth on the Proxy provided to them. A Debentureholder may revoke a previously voted Proxy in accordance with the instructions set forth in the Circular.
The 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 TSX 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 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 Redemptions; the expected terms of the Amendments; the expected effective date of the Amendments; and the expected benefits of the 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 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 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 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.
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