Retirement Residences Real Estate Investment Trust
TSX : RRR.UN
TSX : RRR.DB.B
TSX : RRR.DB.C

Retirement Residences Real Estate Investment Trust

August 23, 2006 08:08 ET

Retirement Residences Real Estate Investment Trust Adopts Unitholder Rights Plan

MISSISSAUGA, ONTARIO--(CCNMatthews - Aug. 23, 2006) - Retirement Residences Real Estate Investment Trust ("Retirement REIT") (TSX:RRR.UN)(TSX:RRR.DB.B)(TSX:RRR.DB.C) announced today that its board of trustees has approved the adoption of a unitholder rights plan (the "Rights Plan"), effective 6:00 p.m. on August 22, 2006, subject to acceptance by the Toronto Stock Exchange. The Board adopted the Rights Plan upon the recommendation of the Special Committee of the Board overseeing the strategic alternative review process being undertaken by Retirement REIT. The rights plan is being adopted to ensure the fair and equal treatment of unitholders in the context of this strategic alternative review process.

The strategic alternative review process is ongoing, and the Special Committee is continuing discussions with interested parties. Any offer for the units resulting from this process would be for all of the issued and outstanding units of Retirement REIT, with all unitholders being treated on an equal basis. There can, however, be no assurance that any agreement will be reached or a transaction consummated. The Board is concerned that the accumulation of a significant block of units by one or more individual parties without an offer being made to all unitholders could have a prejudicial effect on the ongoing strategic alternative review process and could deter interested parties from proceeding with an offer to acquire the units of Retirement REIT.

The Rights Plan will be in effect for a maximum of 180 days, following which it will expire automatically.

Upon receipt of all required regulatory approvals with respect to the Rights Plan, rights will be issued and attached to all Retirement REIT units. A separate rights certificate will not be issued until such time as the rights become exercisable (which is referred to as the "separation time"). The rights will become exercisable only if a person, together with its affiliates, associates and joint actors, acquires or announces its intention to acquire beneficial ownership of units which when aggregated with its current holdings total 15% or more of the outstanding Retirement REIT units (determined in the manner set out in the Rights Plan), other than by a Permitted Bid (as defined in the Rights Plan). Following an acquisition of units otherwise prohibited by the Rights Plan, each right held by a person other than the acquiring person and its affiliates, associates and joint actors would, upon exercise, entitle the holder to purchase that number of Retirement REIT units which have a current market value equal to twice the exercise price payable for such units.

Retirement REIT is the largest provider of accommodation and care for seniors in Canada. Retirement REIT owns 223 retirement and long term care facilities, including 40 facilities in select United States markets, and provides management services to 9 homes for other parties, with an aggregate resident capacity in excess of 26,500. Retirement REIT also provides nursing placement and in-home health care through its Central Health Services unit. For further information, see the Retirement REIT website at www.retirementreit.com.

Contact Information

  • Media:
    Lute & Company
    John Lute
    (416) 929-5883
    or
    Investors:
    Tim Benson
    Director, Investor Relations
    (289) 360-1224
    (289) 360-1228 (FAX)