WINNIPEG, MB, Nov. 10, 2021 /CNW/ - Lakeview Hotel
Investment Corp. ("Lakeview" or the "Company") (TSXV:
LHR) announced today that it has entered into an arrangement
agreement dated November 9, 2021 (the
"Arrangement") with 13487407 Canada Inc. ("Parent"),
13487369 Canada Inc. ("Share Purchaser") and 13487326 Canada
Inc. ("Debenture Purchaser", and together with Parent and
Share Purchaser, the "Purchasers"), newly formed private
companies which are managed by First Canadian Management
Corporation ("FCMC"), pursuant to which: (i) Share Purchaser
has agreed to acquire all of the outstanding common shares of
Lakeview for $0.02 per share in cash
for aggregate consideration of $391,156.12; (ii) Debenture Purchaser has agreed
to acquire all of the outstanding Series C Debentures and all of
the Series D Debentures of Lakeview for $74.03 per $1,000
principal amount outstanding under the Series C Debentures and the
Series D Debentures, for aggregate consideration of $1,356,673.78 and $752,144.80, respectively, and any and all
accrued and unpaid interest owing to the Debentureholders shall be
forgiven, settled and extinguished for no consideration; and (iii)
Share Purchaser has agreed to pay to LHIC or to the benefit of LHIC
approximately $15,000,000 for LHIC to
pay and satisfy all amounts owing by LHIC to its lending syndicate
led by ATB Financial, and to pay certain costs associated with the
foregoing transaction (the "Transaction").
TRANSACTION HIGHLIGHTS
- The consideration for issued and outstanding shares is
$0.02. The closing price of the
shares on the TSX-V on November 9,
2021, the last trading date prior to the public announce of
the Arrangement was $0.025 (TSX-V
Symbol: LHR).
- The consideration for the issued and outstanding Series C
Debentures of the Company is $74.03
per $1,000 principal amount
outstanding (or $7.403 per
$100 principal amount
outstanding). The closing price of the Series C Debentures on
the TSX-V on November 9, 2021, the
last trading date prior to the public announce of the Arrangement
was $1.65 (TSX-V Symbol: LHR) based
on a face value of $100.
- The consideration for the issued and outstanding Series D
Debentures of the Company is $74.03
per $1,000 principal amount
outstanding (or $7.403 per
$100 principal amount
outstanding). The closing price of the Series D Debentures on
the TSX-V on November 9, 2021, the
last trading date prior to the public announce of the Arrangement
was $1.15 (TSX-V Symbol: LHR.DB.D)
based on a face value of $100.
- FCMC and the Purchasers are all arms' length to
Company.
- There are currently 19,557,806 Common Shares outstanding,
18,326 Series C Debentures ($18,326,000 principal amount), and 101,600 Series
D Debentures ($10,160,000 principal
amount). Immediately following closing, the foregoing
securities will remain outstanding with the Shares registered in
the name of the Share Purchaser and the Debentures registered in
the name of the Debenture Purchaser.
TRANSACTION DETAILS
The transaction, which will be completed by way of a plan of
arrangement (the "Arrangement"), is expected close in late
December 2021, subject to the
satisfaction of certain closing conditions.
Completion of the transaction is subject to customary closing
conditions, including court approval of the Arrangement and the
approval of the Arrangement by Lakeview shareholders, Series C
Debentureholders and Series D Debentureholders, each voting
separately as a single class (together with any majority of the
minority voting approvals required under applicable Canadian
securities laws).
The foregoing summary is qualified in its entirety by the
provisions of the Arrangement Agreement, a copy of which will be
filed on SEDAR at www.sedar.com. Lakeview will mail a
management information circular and certain related documents to
shareholders in connection with the special meeting to consider and
vote on the Transaction, copies of which will also be filed on
SEDAR at www.sedar.com.
LAKEVIEW BOARD OF DIRECTORS RECOMMENDATION AND FAIRNESS
OPINION
The Board of Directors, after receiving the unanimous
recommendation of the Special Committee, and in consultation with
its legal advisors, has unanimously determined that the Transaction
is in the best interests of Lakeview and fair to shareholders and
debentureholders and is recommending that shareholders and
debentureholders, respectively, vote in favour of the
Transaction.
Tw Advisory has provided a fairness opinion to the Special
Committee and Board of Directors that based upon and subject to the
assumptions and limitation described in its opinion, the
consideration to be received by shareholders and debentureholders,
respectively, pursuant to the Transaction is fair, from a financial
point of view, to the shareholders and debentureholders,
respectively.
ADVISORS
Fillmore Riley LLP is acting as legal counsel to the Company. De
Grandpré Chait S.E.N.C.R.L./LLP is acting as legal counsel to the
Purchasers. Tw Advisory has provided the Special Committee
and the Board of Directors with a fairness opinion in respect of
the Transaction. Thompson Dorfman Sweatman LLP is acting as
legal counsel to the Special Committee. Colliers Hotels is
acting as advisor to the Company.
ABOUT LAKEVIEW HOTEL INVESTMENT CORP.
Lakeview is a Canada-based
company engaged in hotel operations, which includes room rental,
food and beverage, and other incidental services. The Company
operates a portfolio of five hotels, being: Lakeview Inn and
Suites, Okotoks; Lakeview Inn and
Suites, Fort Saskatchewan;
Lakeview Inn and Suites, Fort St.
John; Lakeview Inn and Suites, Chetwynd; and Lakeview Inn & Suites, Edson
Airport West.
ABOUT FIRST CANADIAN MANAGEMENT CORP.
First Canadian Management Corp. is a private company which,
through its related group of companies, owns and manages various
hotels throughout Canada. The Parent, Share Purchaser and
Debenture Purchaser are each a special purpose vehicle which are
managed by FCMC and which have been constituted for purposes of
concluding the Transaction.
FORWARD-LOOKING INFORMATION
This news release contains forward-looking information and
statements within the meaning of applicable Canadian securities
laws (herein referred to as "forward-looking statements")
that involve known and unknown risks, uncertainties and other
factors that may cause actual results, performance or achievements
to be materially different from any future results, performance or
achievements expressed or implied by such forward-looking
statements. All information and statements in this news release
which are not statements of historical fact may be forward-looking
statements. The words "believe", "expect", "intend", "estimate",
"anticipate", "project", "scheduled", and similar expressions, as
well as future or conditional verbs such as "will", "should",
"would", and "could" often identify forward-looking statements. In
particular, forward-looking statements in this news release
include, but are not limited to: the closing of the Transaction on
the terms and timing set out herein or at all, and the payment of
the termination fee to the Parent in certain circumstances or at
all. Such statements or information are only predictions and
reflect the current beliefs of management with respect to future
events and are based on information currently available to
management. Actual results and events may differ materially from
those contemplated by these forward-looking statements due to these
statements being subject to a number of risks and
uncertainties.
Undue reliance should not be placed on these forward-looking
statements as there can be no assurance that the plans, intentions
or expectations upon which they are based will occur. By their
nature forward-looking statements involve assumptions and known and
unknown risks and uncertainties, both general and specific, that
contribute to the possibility that the predictions and other
forward-looking statements will not occur. Some of the assumptions
made by Lakeview, upon which such forward-looking statements are
based include, but are not limited to: the closing of the
Transaction on the terms set out herein or at all, the payment of
the reverse termination fee in certain circumstances, and the
receipt of requisite approvals and financing for the
Transaction.
A number of factors could cause actual results to differ
materially from those expressed or implied by the forward-looking
statements, including, but not limited to: prevailing economic
conditions; unexpected changes in the financial markets (including
in the trading price of the securities of Lakeview); changes in the
general economic and business conditions of one or more of Lakeview
and its subsidiaries, and any of the conditions to the Transaction
not being satisfied. Should any of the risks or uncertainties
facing Lakeview and its subsidiaries materialize, or should
assumptions underlying the forward-looking statements prove
incorrect, actual results, performance, activities or achievements
could vary materially from those expressed or implied by any
forward-looking statements contained in this news release. Readers
are cautioned that the foregoing list of risks is not exhaustive.
Additional information on these and other factors that could affect
the operations or financial results of Lakeview and its
subsidiaries are included in the information circular in connection
with the meeting to approve the Arrangement, a copy of which will
be available under Lakeview's profile on SEDAR (www.sedar.com).
Although Lakeview believes that the expectations represented by
any forward-looking statements contained herein are reasonable
based on the information available to it on the date of this news
release, management cannot assure investors that actual results,
performance or achievements will be consistent with these
forward-looking statements. Any forward-looking statements herein
contained are made as of the date of this news release and Lakeview
does not assume any obligation to update or revise them to reflect
new information, events or circumstances, except as required by
law.
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in policies
of the TSX Venture Exchange) accepts responsibility for the
adequacy or accuracy of this release.
SOURCE Lakeview Hotel Investment Corp