Continuum Health Care Inc. announces transaction with Vantage West Development Corp.



    CALGARY, Jan. 10 /CNW/ - Continuum Health Care Inc. (TSXV-CCF) (the
"Corporation") today announced that the Corporation and its wholly-owned
subsidiary, Continuum Health Care Holdings Ltd. ("Holdings"), have entered
into several agreements dated December 28, 2007 (the "Agreements") with
Oka-Rose (Ponoka) Limited Partnership ("Oka-Rose"), by its general partner,
Eldercare (Ponoka) Ltd., and Sunrise Village (Ponoka) Holdings Ltd. relating
to the financing, planning, development and marketing of a 68-unit supportive
living facility in Ponoka, Alberta (the "Ponoka Facility"). All of the
transactions proposed pursuant to the Agreements are subject to regulatory
approval.

    Summary of Proposed Transactions
    --------------------------------
    Holdings entered into a joint venture agreement with Oka-Rose (by its
general partner, Eldercare (Ponoka) Ltd.) to be known as the Sunrise Village
(Ponoka) Joint Venture (the "JV"). The trustee of the JV is Sunrise Village
(Ponoka) Holdings Ltd. (the "Trustee") and is, or is entitled to become, the
registered owner of the lands on which the Ponoka Facility is to be built, on
behalf of the JV. Vantage West Development Corp. ("Vantage") is the project
manager of the Ponoka Facility pursuant to a project management agreement
dated December 28, 2007 between Vantage and the Trustee. Continuum has entered
into a facility management agreement with the Trustee dated December 28, 2007
whereby Continuum shall be the sole and exclusive managing agent of the Ponoka
Facility.
    Pursuant to the joint venture agreement, Holdings will contribute
$1,540,616 to the JV to assist in the development of the Ponoka Facility. In
consideration for the management services to be provided by Continuum under
the facility management agreement, the Trustee will pay to Continuum a fee of
$5,666.67 per month until date the first tenant occupies a unit in the Ponoka
Facility, not to exceed $68,000 in the aggregate. In addition, during the term
of the facility management agreement (5 years), the Trustee will pay Continuum
5% of the total revenue from all of the Ponoka Facility's operating
departments per month (the "gross revenue"), as well as 5% of net revenue
(gross revenue less operating expenses) per year.

    Related Party Matters
    ---------------------
    Oka-Rose is a "related party" of Continuum within the meaning of the
policies of the TSX Venture Exchange in that Eldercare (Ponoka) Ltd., the
general partner of Oka-Rose, is a company 100% owned by Evan Welbourn, a
director of Continuum. The Board of Directors of the Corporation has
determined that the transaction is exempt from the "related party" valuation
requirements of the TSX Venture Exchange because no securities of the
Corporation are listed on the Toronto Stock Exchange, the New York Stock
Exchange, the American Stock Exchange, the NASDAQ Stock Market or a stock
exchange outside of Canada and the United States.
    The independent directors of the Corporation have approved the proposed
transactions and have determined that the transactions are in the best
interests of the Corporation and its shareholders, and the Corporation has
therefore requested an exemption from the requirement of shareholder approval
pursuant to the policies of the TSX Venture Exchange.
    Vantage is also a "related party" of Continuum in that three of the
directors of Continuum (including the Chief Financial Officer and the Chief
Executive Officer) are also the sole shareholders and directors of Vantage.

    Business Reasons and Anticipated Effect on Continuum
    ----------------------------------------------------
    Pursuant to these transactions, Continuum and Oka-Rose will share
ownership of the Ponoka Facility through the JV, Vantage will provide project
management services and Continuum will provide facility management services
for the facility. These transactions are part of the Corporation's strategic
plan to improve earnings, returns on common equity and enhance total assets by
means of expanding its operations in Alberta.
    Continuum owns, operates, manages and develops assisted living facilities
in Alberta. The Corporation currently jointly owns and manages facilities in
Olds, Lethbridge and Wetaskiwin. The Corporation also has joint venture
interests in facilities under development or proposed in Camrose, Ponoka and
High River. The Corporation currently owns or manages with its joint venture
partners, 167 assisted living facility units. As a result of the transactions
referenced above, the number of units owned and managed by the Corporation
with its joint venture partners will increase from 167 to 235 units. The
Corporation has a total of 17,854,283 common shares outstanding, 19,604,283
fully diluted.

    The TSX Venture Exchange does not accept responsibility for the adequacy
    or accuracy of this release.




For further information:

For further information: Continuum Health Care Inc., Mr. Patrick Hovan,
President and CEO, Phone: (403) 556-1971

Organization Profile

CONTINUUM HEALTH CARE INC.

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