Lakeview Hotel Investment Corp. Announces Results of the Special Meeting of Holders of Series C Redeemable Subordinated Debentures and Results of the Special Meeting of Holders of Series D Redeemable Subordinated Debentures

WINNIPEG, Nov. 29, 2016 /CNW/ - Lakeview Hotel Investment Corp ("LHIC") announced today that the previously announced meetings of the holders of Series C Redeemable Subordinated Debentures (the "Series C Debentures") and the holders of Series D Redeemable Subordinated Debentures (the "Series D Debentures", and together with the Series C Debentures, the "Debentures") was held today.

LHIC is pleased to announce that the holders of the Series C Debentures have approved the resolution (the "Series C Resolution") which was placed in front of them at the meeting as more specifically set out in the Management Information Circular dated October 27, 2016, which was previously filed on SEDAR.  The Series C Resolution passed with 89.89% of the holders of Series C Debentures present in person or represented by proxy at the meeting voting in favour. The Series C Resolution authorizes LHIC to make certain amendments to the trust indenture governing the Series C Debentures as set out in the aforementioned Management Information Circular and as summarized below:

• Extending the maturity date of the Series C Debentures from June 30, 2017 to August 22, 2019;
• Changing the interest rate payable on the Series C Debentures from 8.0% per annum to 7.0% per annum;
• Changing the payment of interest from being payable semi-annually to being payable on the maturity date (as amended above) which includes the interest accrued since June 30, 2016, the last interest payment date, to the date hereof; and
• Including two additional restrictive covenants to Section 6.04 of the Series C Trust Indenture:
  • the first being to restrict the payment of deferred fees by the Corporation to Lakeview Management Inc. that would reduce the deferred fee balance owing to Lakeview Management Inc. to under $3.1 million until such time as all accrued and unpaid interest on the Series C Debentures has been paid to the Series C Debentureholders.  In connection with the foregoing, the Corporation acknowledges that any of the $3.1 million deferred fees referred to above outstanding as of the maturity date (as amended above) are subordinate to repayment of the principal amount outstanding under the Series C Debentures along with any accrued and unpaid interest payable thereon; and
  • the second to provide that the Corporation may not increase the principal amount of senior debt (other than in connection with the Corporation's hotel in Prince George, British Columbia) beyond the amount outstanding as at the date of the third supplemental indenture unless either (i) Series C Debentureholder approval has been obtained or (ii) the amount in excess of such principal amount is used to pay down the accrued interest and principal on the Series C Debentures and the Corporation's Series D Redeemable Subordinated Debentures on a pro rata basis.

In order to effect the amendments to the Series C Debentures, LHIC will be required to enter into a supplemental trust indenture with the trustee for the Series C Debentures, CIBC Mellon Trust Company. The amendments to the Series C Debentures will be effective on or about November 28, 2016.

There is currently $18,326,000 principal amount of Series C Debentures issued and outstanding. Each Series C Debenture has a face value of $1,000.00. The Series C Debentures are listed on the TSX Venture Exchange under the trading symbol "LHR.DB.C".

LHIC is further pleased to announce that the holders of the Series D Debentures have approved the resolution (the "Series D Resolution") which was placed in front of them at the meeting as more specifically set out in the Management Information Circular dated October 27, 2016, which was previously filed on SEDAR. The Series D Resolution passed with 86.29% of the holders of Series D Debentures present in person or represented by proxy at the meeting voting in favour. The Series D Resolution authorizes LHIC to make certain amendments to the trust indenture governing the Series D Debentures as set out in the aforementioned Management Information Circular and as summarized below:

• Extending the maturity date of the Series D Debentures from May 31, 2018 to August 22, 2019;
• Changing the interest rate payable on the Series D Debentures from 9.0% per annum to 7.0% per annum;
• Changing the payment of interest from being payable semi-annually to being payable on the maturity date (as amended above) which includes the interest accrued since May 31, 2016, the last interest payment date, to the date hereof; and
• Including two additional restrictive covenants to Section 6.04 of the Series D Trust Indenture:
  • the first being to restrict the payment of deferred fees by the Corporation to Lakeview Management Inc. that would reduce the deferred fee balance owing to Lakeview Management Inc. to under $3.1 million until such time as all accrued and unpaid interest on the Series D Debentures has been paid to the Series D Debentureholders.  In connection with the foregoing, the Corporation acknowledges that any of the $3.1 million deferred fees referred to above outstanding as of the maturity date (as amended above) are subordinate to repayment of the principal amount outstanding under the Series C Debentures along with any accrued and unpaid interest payable thereon; and
  • the second to provide that the Corporation may not increase the principal amount of senior debt (other than in connection with the Corporation's hotel in Prince George, British Columbia) beyond the amount outstanding as at the date of the third supplemental indenture unless either (i) Series D Debentureholder approval has been obtained or (ii) the amount in excess of such principal amount is used to pay down the accrued interest and principal on the Series D Debentures and the Corporation's Series C Redeemable Subordinated Debentures on a pro rata basis.

In order to effect the amendments to the Series D Debentures, LHIC will be required to enter into a supplemental trust indenture with the trustee for the Series D Debentures, CIBC Mellon Trust Company. The amendments to the Series D Debentures will be effective on or about November 28, 2016.

There is $10,160,000 principal amount of Series D Debentures issued and outstanding. Each Series D Debenture has a face value of $100.00. The Series D Debentures are listed on the TSX Venture Exchange under the trading symbol "LHR.DB.D".

Lakeview Hotel Investment Corp. is listed on the TSX Venture Exchange under the symbol "LHR". Lakeview Hotel Investment Corp. receives income from ownership, management and licensing of hotel properties.

The TSX Venture Exchange nor its Regulation Service Provider (as the term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE Lakeview Hotel Investment Corp

Avrum Senensky, Executive Vice President, Tel: [phone], Fax: [phone], Email [email protected]