Peak Resorts, Inc. Completes Private Placement Of $20 Million Of Cumulative Convertible Preferred Stock And Warrants

WILDWOOD, Mo., Nov. 02, 2016 (GLOBE NEWSWIRE) -- Peak Resorts, Inc. (Nasdaq:SKIS), a leading operator of high-quality, individually branded ski resorts in the U.S., today announced the completion of its previously announced private placement of its Series A cumulative convertible preferred stock and warrants to purchase common stock to CAP 1 LLC, a family client of Summer Road LLC. 

The private placement consists of $20 million in Series A cumulative convertible preferred stock and three warrants, exercisable for 12 years, to purchase 1,538,462 shares of the Company's common stock at $6.50 per share; 625,000 shares of common stock at $8.00 per share; and 555,556 shares of common stock at $9.00 per share, in each case, subject to adjustments. FBR served as financial advisor to Peak Resorts in the transaction.

With the completion of this private placement, also now in effect is the previously approved Modification of Master Credit Agreements with affiliates of EPR Properties, approved as of October 24, 2016. With the Modification Agreement in effect, additional debt service deposits due to EPR have been reduced to $1.1 million in cash or letter of credit, and the fixed charge coverage ratio will not be measured again until on or after May 1, 2017. The Modification Agreement requirement regarding the potential future tripping of the fixed charge coverage ratio covenant would require the Company to increase the cash or letter of credit to a total of three months of additional interest.

These actions address the issue of Peak Resorts' current cash position being restrained due to ongoing delays in the release of funds raised pursuant to the United States Citizenship and Immigration Services (USCIS) EB-5 Program. The Company believes that the private placement investment and Modification Agreement debt service adjustments will increase capital levels and provide funding for continued growth and general corporate purposes.

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