Royal Host Real Estate Investment Trust

Royal Host Real Estate Investment Trust

December 15, 2010 09:39 ET

Royal Host REIT Announces Unitholder Approval of Conversion to a Corporation

Royal Host REIT also Announces Distribution of $0.025 to Unitholders

HALIFAX, NOVA SCOTIA--(Marketwire - Dec. 15, 2010) - Royal Host Real Estate Investment Trust (TSX:RYL.UN)(TSX:RYL.DB.B)(TSX:RYL.DB.C)(TSX:RYL.DB.D) ("Royal Host" or the "Trust") is pleased to announce that the previously announced proposal to convert the Trust into a corporation pursuant to a plan of arrangement (the "Arrangement") under the Canada Business Corporations Act was approved at the Special Meeting of Unitholders held today. Subject to the final approval of the Nova Scotia Supreme Court, and other required approvals, it is anticipated that the Arrangement will be become effective on or about January 1, 2011. Pursuant to the Arrangement, each holder of units of the Trust will receive for each Trust unit held one common share of Royal Host Inc. ("RHC"). The shares of RHC have been conditionally approved for listing on the Toronto Stock Exchange.


Royal Host has declared a distribution of $0.025 per unit, payable December 31, 2010, to Unitholders of record on December 30, 2010 (the "Distribution").

This Distribution will be the final distribution to Unitholders prior to the Arrangement. Following the completion of the Arrangement, the intention is for RHC to adopt a cash management policy that will enable it to pay regular quarterly dividends to shareholders while allowing RHC the flexibility to maximize long term shareholder value.

While it is the intention for RHC to pay regular dividends, no assurance can be given as to whether RHC will pay dividends, or the frequency or amount of any such dividend. The declaration of dividends will be subject to the discretion of the board of directors of RHC and may vary depending on, among other things, RHC's operating cash flow, financial requirements, limitations or restrictions under credit facilities, the requirements of the Canada Business Corporations Act for the declaration of dividends and other conditions existing at such future time.

Forward-Looking Statements

This press release contains forward-looking statements. Forward-looking information and statements are identified by words or phrases such as "anticipates", "expects", "believes", "estimates", "intends", "could", "may", "plans", "predicts", "projects", "will", "would", "foresees", "remain confident that" and other similar expressions or the negative of these terms and include, without limitation, forward-looking statements made in this press release relating to: (i) distributions and dividends; (ii) expected timing of the Arrangement; (iii) listing on stock exchanges and the timing thereof; (iv) expected approvals from the Nova Scotia Supreme Court. Actual events or results may differ materially.

Forward-looking statements included in this press release are made based on management's belief as well as assumptions made by, and information currently available to, management of the Trust. While such beliefs and assumptions are considered reasonable by the Trust, they are inherently subject to significant business, economic and competitive uncertainties and contingencies. A number of important factors could cause actual results to differ materially from those projected in the forward-looking statements. These uncertainties and risks include, but are not limited to: (i) changes in laws and regulations affecting the Trust or RHC and their respective business operations, (ii) changes in taxation of the Trust or RHC, (iii) general economic and business conditions in the markets affecting the Trust or RHC, (iv) failure to satisfy the conditions of the conversion, (v) inability to obtain required consents, permits or approvals, for the conversion, including court approval of the Arrangement, (vi) inability to meet or continue to meet listing requirements; (vii) failure to realize anticipated benefits of the Arrangement; (viii) actual future market conditions and actual future operating and financial results being different than anticipated by management and the board of trustees of the Trust; (ix) stock market volatility and the inability to access sufficient capital from internal and external sources; (x) fluctuation in foreign exchange or interest rates. The foregoing list is not exhaustive. In addition, these forward-looking statements relate to the date on which they are made. Although the forward-looking statements contained herein are based upon what management believes to be reasonable assumptions, the Trust cannot assure Unitholders that actual results will be consistent with these forward-looking statements, and, except as required by law, the Trust disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In formulating the forward-looking statements herein, management has assumed that business and economic conditions affecting it will continue substantially in the ordinary course, including without limitation with respect to industry conditions, general levels of economic activity, regulation, taxes, foreign exchange rates and interest rates, that there will be no unexpected material changes in its facilities, customer and employee relations, credit arrangements or credit and collections experience.

About Royal Host

Royal Host is a uniquely diversified hospitality trust that delivers Unitholder value through hotel ownership, investment, and franchising. Royal Host's portfolio of Canadian hotels operates under a variety of recognizable brands as well as a number of unbranded properties. The Trust's hotel portfolio is further enhanced by a stable franchising business, and a portfolio of publicly-traded securities from within the hospitality and service sectors.

Royal Host trust units and convertible debentures are traded on the Toronto Stock Exchange under the trading symbols "RYL.UN", "RYL.DB.B", "RYL.DB.C" and "RYL.DB.D", respectively.

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