ALL IN WEST! CAPITAL CORPORATION ANNOUNCES DEFAULT UNDER MORTGAGES AND DEBENTURES
23 Noviembre 2010 - 4:34PM
PR Newswire (Canada)
WINNIPEG, Nov. 23 /CNW/ -- WINNIPEG, Nov. 23 /CNW/ - All in West!
Capital Corporation (the "Corporation") (TSX-V: ALW) announced
today that, effective immediately, it plans to cease all monthly
interest payments on its 8.00% Series C Convertible Debentures (the
"Series C Debentures") until such time that the Corporation
determines that its financial condition and cash flows enable the
Corporation to resume payments. Given the financial condition of
the Corporation, there can be no assurance that the Corporation's
financial status and cash flows will improve to a point which will
enable it to pay any amounts (principal or interest) under its
Series C Debentures. "2009 and 2010 have been financially difficult
years for the Corporation. The general economic conditions where
the Corporation's portfolio of hotels is located declined
drastically in 2009 and there has been little improvement in 2010"
said Cornelius Martens, CEO of All in West! Capital Corporation.
"Year-to-date the Corporation has been cash flow negative and as a
result, the Corporation is not in a position to make monthly
interest payments on the Series C Debentures". Earlier in 2010, the
Corporation implemented an action plan involving various
stakeholders, including management, the board of directors, Series
A and B debentureholders, and lenders. The action plan involved the
following steps: (i) management and the directors of the
Corporation indefinitely waived all asset management fees and
director fees retroactive to January 2010; (ii) the Corporation
ceased its monthly interest payments on the Series A and Series B
debentures of the Corporation beginning in April 2010; and (iii) an
agreement was reached with certain lenders to allow the Corporation
to make interest-only payments on its mortgages, giving temporary
principal payment relief to the Corporation. Two of these lender
agreements have expired. While the Corporation continues to
negotiate with such lenders for continued approval to make
interest-only payments until the financial condition and cash flows
of the Corporation improve, these mortgages are now in default.
Since all of the Corporation's mortgages are cross-collateralized,
the Corporation is in default of all of its mortgages and its
lenders have the right demand the immediate payment of their
respective loan principal and outstanding interest. Although no
lender has made such a demand to date, if the payment of the full
amount of any or all of the mortgages were to be demanded, the
Corporation would not be able to satisfy any such demands. In
addition, the indenture trustee for the Corporation's Series A, B
and C Debentures is entitled to demand payment of all outstanding
principal and interest thereunder, subject to the rights of senior
lenders. There can be no assurance that the Corporation will be in
a position to pay the principal amount or accrued interest on its
outstanding debentures. Even if the Corporation is able to obtain
approval of its lenders for interest-only payments, there can be no
assurance that the Corporation will be in a position to make such
interest-only payments at any time in the future. Management and
the Board of Directors of All in West! Capital Corporation continue
efforts to identify and evaluate alternatives which may be
available to the Corporation with a view to the best interest of
the Corporation. This press release contains forward-looking
statements, including statements about management's action plan,
the financial condition of the Corporation and the ability of the
Corporation to meet its ongoing obligation to its various lenders.
Forward-looking statements are subject to risks and uncertainties
that could cause actual results to differ materially from what the
results expressly stated or implied in such forward-looking
statements. Some of these risks and uncertainties are
described under "Risk Factors" in the Corporation's prospectus
dated August 26, 2009 and its management discussion and analysis
dated June 30 2010, copies of which are available at www.sedar.com
and include the risk that management's action plan will not be
successful. All forward-looking statements contained herein are
expressly qualified by this cautionary statement. The TSX Venture
Exchange has not reviewed or approved the contents of this press
release. pplease contact Mr. Cornelius Martens, President and Chief
Executive Officer, or Cornelius William Martens, Investor
Relations, Tel: (204) 947-1200./p
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