SLATE OFFICE REIT
As a result of the later meeting date, unitholders who wish to vote their units in advance of the meeting date, now have until
The special resolution put forward for approval by the unitholders permits the trustees of the REIT to amend the declaration of trust to give effect to an amendment to remove the restriction in the declaration of trust, which currently provides that the REIT's indebtedness cannot exceed 65% of gross book value (i.e. total assets less restricted cash) (the 'Restriction'), as such amendment may be varied by the trustees of the REIT in their discretion. This proposed change to the declaration of trust is intended to provide greater flexibility to the REIT, while management pursues its previously disclosed portfolio realignment plan.
To be approved, the special resolution requires at least two-thirds of the votes cast by unitholders at, or prior to the special meeting, to vote in favour of the proposed amendment. In order to provide unitholders with more time to consider the proposed amendment, the board of trustees of the REIT has decided to postpone the special meeting to
Management of the REIT strongly believes that approval of the proposed amendment is in the best interests of the REIT. In addition, ISS has issued a report recommending that unitholders vote in favour of the proposed amendment.
Unitholders who have not yet supported the proposed resolution are urged to do so.
For the avoidance of doubt, the record date for the determination of unitholders who are entitled to receive the notice of, and to attend and vote at, the special meeting (including any postponement thereof), will remain unchanged as
Details about the special meeting, including instructions on how a unitholder can vote its units, are set out in the information circular and other meeting materials, which were previously sent to unitholders. The form of proxy and voting instruction form for use at the postponed meeting remain valid and applicable for use at the postponed meeting. As a result of the later meeting date, unitholders who wish to vote their units in advance of the meeting date (including making changes to any previously submitted voting instructions), now have until
Why the Proposed Amendment Is Important
The declaration of trust currently includes the Restriction.
Under the declaration of trust, the measurement of any indebtedness against the REIT's gross book value is completed only at the time of the incurrence or assumption of the indebtedness in question (which would exclude the refinancing of existing debt that is outstanding) and is not a determination that is continually assessed over time against the REIT's gross book value. In addition, the REIT has initiated a plan to dispose of certain properties to raise capital in order to increase liquidity and reduce the REIT's outstanding borrowings. However, primarily due, in part, to a decrease in investment property valuations, the REIT's indebtedness ratio at
Management's short-term target is to reduce the REIT's total indebtedness to below 65% of its gross book value by executing on the portfolio realignment plan to decrease leverage and generate equity to pay down the REIT's revolving credit and operating facilities. The success of this strategy is dependent upon debt market conditions for borrowing, as well as the characteristics of the underlying assets being financed. If this strategy is unsuccessful, debt principal repayments may need to be funded by operating cash flows, additional draws under the REIT's revolving credit and operating facilities, or by issuances of equity or debt securities, and if such funding is not sufficiently available and the REIT's gross book value declines further, total indebtedness may increase further beyond 65% of the REIT's gross book value.
The amendment is intended to provide greater flexibility to the REIT, which (among other things) regularly refinances its existing indebtedness as part of its ordinary course of business, and while management pursues the portfolio realignment plan to decrease leverage. This need for this flexibility has become increasingly important, and management expects that trend to continue. For example, the REIT has recently been presented with accretive leasing opportunities that management and the board of trustees believe could be executed on in the near term, but which the REIT may not be able to pursue without the flexibility to incur additional indebtedness in connection with tenant inducement obligations.
About
About
Forward-Looking Statements
Certain information herein constitutes 'forward-looking information' as defined under Canadian securities laws which reflect management's expectations regarding objectives, plans, goals, strategies, future growth, results of operations, performance, business prospects and opportunities of the REIT. The words 'plans', 'expects', 'does not expect', 'scheduled', 'estimates', 'intends', 'anticipates', 'does not anticipate', 'projects', 'believes', or variations of such words and phrases or statements to the effect that certain actions, events or results 'may', 'will', 'could', 'would', 'might', 'occur', 'be achieved', or 'continue' and similar expressions identify forward-looking statements. Such forward-looking statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations.
Forward-looking statements are necessarily based on a number of estimates and assumptions that, while considered reasonable by management as of the date hereof, are inherently subject to significant business, economic and competitive uncertainties and contingencies. When relying on forward-looking statements to make decisions, the REIT cautions readers not to place undue reliance on these statements, as forward-looking statements involve significant risks and uncertainties and should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not the times at or by which such performance or results will be achieved. A number of factors could cause actual results to differ, possibly materially, from the results discussed in the forward-looking statements. Additional information about risks and uncertainties is contained in the filings of the REIT with securities regulators.
Contact:
Tel: +1 416 644 4264
Email: ir@slateam.com
(C) 2023 Electronic News Publishing, source
