All in West! Capital Corporation Announces Notice of Default on Repayment of Principal of Series B and Series C Debentures
05 September 2012 - 11:31PM
PR Newswire (Canada)
WINNIPEG, Sept. 5, 2012 /CNW/ - All in West! Capital Corporation
(the "Corporation") announced today that it has delivered formal
written notice to CIBC Mellon Trust Company, the indenture trustee
for its Series B convertible debentures (the "Series B Debentures")
which mature on September 28, 2012, and for its Series C
convertible debentures (the "Series C Debentures") which mature on
October 1, 2012, that the Corporation will default on its
obligation to repay the principal amount and accrued interest on
the Series B and Series C Debentures on their respective maturity
dates. The Corporation has been in default of its obligations
relating to the Series B Debentures since April 30, 2010, when it
ceased making monthly interest payments. It has been in
default of its obligations relating to the Series C Debentures
since November 30, 2010, when it ceased making monthly interest
payments. In addition to the current and anticipated default of the
Corporation relating to its Series B and Series C Debentures, the
Corporation is also in default of a number of its obligations under
various financing documents. Such defaults include the
following: (i) the Corporation is in default of its obligation to
repay principal plus interest relating to the Series A convertible
debentures (the "Series A Debentures") which matured on March 31,
2012. The Corporation ceased monthly interest payments on April 30,
2010; (ii) the Corporation is in default of its obligation to make
principal and interest payments to the mortgagee under its mortgage
financing and security documents relating to the Econolodge Inn and
Suites in Hinton, Alberta. The outstanding mortgage balance is
currently $6,404,820; (iii) as a result of the defaults noted
above, the Corporation is in breach of the "cross-default"
covenants under its mortgage financing and security documents
relating to the Phase I and Phase II Best Western hotels in Grande
Cache, Alberta. The outstanding mortgage balances for such
properties are currently $7,775,582 in respect of the Phase I
property and $4,637,066 in respect of the Phase II property. The
Corporation is in ongoing discussions with its mortgage lenders
regarding the defaults under its mortgage indebtedness and
potential restructuring of such indebtedness. Earlier this year,
the Corporation sold the Days Inn in Hinton, Alberta to the
mortgage lender in consideration for the settlement of the
outstanding mortgage indebtedness. The property was independently
appraised for $3,000,000 and $4,224,888 of debt owed by the
Corporation to the mortgage lender was forgiven. The Corporation is
continuing to evaluate alternatives available to it. The
Corporation formed a special committee whose mandate is to evaluate
the Corporation's alternatives specifically as it relates to its
outstanding convertible debentures and to make recommendations to
the Board of Directors. The Corporation has engaged a third party
investment banking advisor to work with the special committee and
Board of Directors. Caution Concerning Forward-Looking Statements
This news release of All in West! Capital Corporation (the
"Corporation") contains certain statements that constitute
forward-looking information within the meaning of applicable
securities laws ("forward-looking statements"). All
statements other than statements of historical fact contained
herein are forward-looking statements, including, without
limitation, statements regarding the alternatives relating to its
convertible debentures. Certain risks and uncertainties
regarding the Corporation are more fully discussed in the
Corporation's filings with Canadian provincial securities
regulatory authorities, including its most recent management
discussion and analysis, a copy of which is available on
www.sedar.com. The forward-looking statements contained
herein are expressly qualified in their entirety by this cautionary
statement. The Corporation does not undertake any obligation
to update forward-looking statements. Neither the TSX Venture
Exchange nor its service provider has reviewed or approved the
contents of this press release. All in West! Capital Corporation
CONTACT: Please contact Mr. Cornelius Martens, President and
ChiefExecutiveOfficer, or Cornelius William Martens, Investor
Relations, Tel: (204)947-1200.
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