TORONTO, Jan. 29, 2015 /CNW/ - NorthWest International Healthcare Properties Real Estate Investment Trust (TSXV: MOB.UN) (the "REIT") announced today that it has completed the previously announced transaction with NorthWest Value Partners Inc. ("NWVP") to internalize the external management of the REIT (the "Internalization") effective January 1, 2015.
The Internalization resulted in the REIT internalizing the asset management, property management and development functions of the REIT previously carried on by affiliates of NWVP. The REIT also acquired from NWVP all of the rights and obligations relating to the management of Vital Healthcare Property Trust.
In connection with the Internalization, the REIT adopted a second amended and restated deferred unit plan (the "Amended Plan"). The Amended Plan provides for the issuance of up to 17,898,368 trust units (approximately 10% of the issued and outstanding voting units of the REIT), which is an increase from the 2,021,909 trust units reserved for issuance under the REIT's previous deferred unit plan (the "Previous Plan"). As a result of the REIT terminating all external asset management agreements in connection with the Internalization, and having previously terminated its unit option plan, the Amended Plan is the REIT's only equity-based compensation plan.
In connection with the Internalization, the REIT is issuing up to 3,994,661 deferred units to the new employees of the REIT. Of these, 1,711,412 will be fully vested and the balance will be subject to future vesting conditions. Following the Internalization, the REIT issued an additional 5,764,494 deferred units to new employees as a future equity incentive (all of which will be subject to vesting conditions) and 75,000 deferred units to the REIT's independent trustees in recognition of their efforts on behalf of the special committee that was formed for considering and negotiating the Internalization on behalf of the REIT.
In accordance with the Policies of the TSX Venture Exchange, the Amended Plan and the issuance of deferred units thereunder that exceed the number of deferred units authorized for issuance under the Previous Plan are to be considered, and if deemed advisable approved, by disinterested unitholders at the next unitholder meeting of the REIT. If the requisite unitholder approval is not obtained, the Amended Plan will terminate (the REIT will revert to the Previous Plan), as will any deferred units that were granted under the Amended Plan that could not have been granted under the Previous Plan.
NWVP currently owns an approximate 65% interest in the REIT and Paul Dalla Lana, Chairman and Chief Executive Officer of the REIT, is the sole shareholder of NWVP. Accordingly, the Internalization is a "related party transaction" for the purposes Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). A special committee of independent trustees was established by the REIT for the purposes of considering the Internalization. The special committee retained independent legal and financial advisors in connection with the Internalization. The Internalization is not subject to the formal valuation and minority approval requirements of MI 61-101 as neither the fair market value nor the subject matter of the transaction represents more than 25% of the REIT's market capitalization. Paul Dalla Lana did not receive any deferred units in connection with the Internalization.
About NorthWest International Healthcare Properties Real Estate Investment Trust
The REIT is an unincorporated, open-ended real estate investment trust established under the laws of the Province of Ontario. The REIT's objectives are to: (i) provide its unitholders with cash distributions from investments focused on international healthcare properties, on a tax efficient basis; (ii) enhance the value of the REIT's assets and maximize long-term unit value; and (iii) expand the asset base of the REIT.
Forward Looking Information
This news release contains "forward-looking statements" within the meaning of applicable securities laws. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations. The statements in this news release are made as of the date of this release and, except as expressly required by applicable law, the REIT assumes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. Although the REIT believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and, accordingly, readers are cautioned not to place undue reliance on such statements due to the inherent uncertainty therein. A discussion of the risk factors applicable to the REIT is contained under the heading "Risk Factors" in the REIT's annual information form dated April 23, 2014 and audited consolidated financial statements and management's discussion and analysis for the year ended December 31, 2013, copies of which may be obtained on the SEDAR website at www.sedar.com.
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 NorthWest International Healthcare Properties REIT
For further information: Paul Dalla Lana, CEO, (416) 366-8300 x1001; Teresa Neto, CFO, (416) 366-8300 x1002