Lakeview Hotel REIT announces results of the special meeting of the holders of the 6.5% Series C Convertible Redeemable Subordinated Debentures and announces a distribution of warrants to the holders thereof

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WINNIPEG, Feb. 22, 2012 /CNW/ - Lakeview Hotel Real Estate Investment Trust (TSXV:LHR.UN) ("Lakeview REIT" or the "Trust") announced today that the previously announced meeting of the holders (the "Debentureholders") of 6.5% Series C Convertible Redeemable Subordinated Debentures (the "Debentures") was held today. The Trustees are pleased to announce that the Debentureholders have approved all resolutions (the "Extraordinary Resolution") which were placed before them by the Trustees at the meeting as more specifically set out in Schedule "A" to the Management Information Circular (the "Circular") dated January 20, 2012 which was previously filed on SEDAR.

The amendments will allow the Trust to focus on its current business strategy and to maintain an adequate working capital position.  Keith Levit, the President of the Trust, stated "We believe that these amendments are in the best interests of debentureholders by providing them with an increasing coupon over time along with the issuance of warrants providing debentureholders with the potential to participate in the growth in the value of the REIT."

The Extraordinary Resolution authorizes the Trust to make certain amendments to the trust indenture governing the Debentures, including, among other things:

• Extending the maturity date of the Debentures from June 30, 2012 to June 30, 2017;
• Changing the payment of interest from being calculated and payable semi-annually at the rate of 6.5% per annum to being calculated and payable semi-annually in arrears at the rate of:

								(i)	6.5% per annum, payable semi-annually in arrears on June 30, 2012, December 31, 2012, June 30, 2013 and December 31, 2013;
								(ii)	7.5% per annum, payable semi-annually in arrears on June 30, 2014, December 31, 2014, June 30, 2015 and December 31, 2015; and
								(iii)	8.0% per annum, payable semi-annually in arrears on June 30, 2016, December 31, 2016 and June 30, 2017.

The effective date for the foregoing amendments is anticipated to be March 2, 2012.

As a result of the meeting the Trustees have declared a special distribution on the outstanding Debentures.  Each holder of Debentures (a "Debentureholder") will receive 384 trust unit purchase warrants (the "Warrants") for each Debenture held by them.  The Warrants will be issued on March 2, 2012, to Debentureholders of record as of the close of business on March 1, 2012.  Each Warrant entitles the holder thereof to purchase one trust unit of Lakeview REIT at an exercise price of $0.65 until March 2, 2017 when the Warrants will expire.  Lakeview REIT has made application to the TSX Venture Exchange to list the Warrants.  The listing of the Warrants is subject to approval by the TSX Venture Exchange as more particularly described in the Circular.    

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

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.

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