Temple REIT to offer C$18 million to C$30 million of 5-year convertibles to yield 8.5%, up 15%

By Rebecca Melvin

New York, March 26 - Canada's Temple Real Estate Investment Trust said it has filed its final short form prospectus for an offering of C$18 million to C$30 million of five-year convertible redeemable debentures to yield 8.5%, according to a company release.

The series B convertible redeemable debentures will have an initial conversion premium of about 15% based on a conversion price of C$7.50 per unit. The conversion ratio will be 13.3333 units per $100 principal amount of debentures, subject to adjustment upon the occurrence of certain events, the release said.

The debentures are non-callable for three years.

The offering is being made on a best efforts basis by a syndicate of investment dealers led by Blackmont Capital Inc.

Temple REIT intends to use about C$10 million of proceeds to partially fund the $24 million purchase price of an Alberta-based hotel. The balance of the purchase price will be funded from the proceeds of mortgage financing.

The Winnipeg-based REIT intends to use the balance of the net proceeds to fund additional acquisitions of hotel properties and for general purposes.

Temple REIT is listed on the Toronto Stock Exchange.

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